AUSTRALIAN WEEKLY MARKET REPORT

Comment

Further instability on global economic issues has eroded confidence from the wool market that has until now recorded one of the more positive periods in the last few years in our history. Since the peak of the EMI exactly one year ago (16/08/18), the benchmark indicator has fallen 28.5%. In USD terms the peak was in June 2018 and it’s now 33.6% lower. The fall in the EMI this week alone was just under 10%. In comparison our pool of non mulesed types indicates that these wools were again much less affected and closed around 2.9% cheaper on average. 15.0/16.0 micron and the better 17.0/18.5 types were again well supported by a different bench of buyers.

AWEX Eastern Indicator compared with 09/08/2019

Eastern Indicator

Close: 1513

Change in % -9.7%

If you want to learn more about AWEX indicators, visit the official website http://www.awex.com.au

Schneider Indicators

The Schneider Indicators are currently being reviewed to provide index values that will better reflect our evolving business. Details and launch in coming weeks. Our apologies to those who rely on these values for market information.

15 Micron

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16 Micron

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17 Micron

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18 Micron

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19 Micron

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Forecast

A fall of this magnitude is significant and must raise further confusion amongst our customers. We can’t underestimate the level of pessimism coming from the Chinese market. This will however, create opportunities for others and considering the correction in price is as great since the peak as we mentioned earlier in this report, this new level of price will encourage some serious considerations. Little has changed fundamentally. We remain very confident for wool as a textile fibre and supply will continue to fall in Australia with the impact of the drought continuing to drive production downwards. Superfine wool clips are coming in earlier than usual and this will impact on supply later this calendar year.

Auction offering – current week

Selling Centres for week 07

Market          Sale          Offered             Sold       Passed In

North                    S 07                      13052                       8548                34.5%

South                   M 07                      15442                       10797              30.1%

West                     F 07                        6929                         3698              46.6%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 08                        T-W                           11194

South                      M 08                       T-W                           22502

West                        F 08                        no sale

 

If you want to see the complete Wool Sales Roster click here.

AUSTRALIAN WEEKLY MARKET REPORT

Comment

The global financial and trade situation is causing enormous uncertainty across all markets and wool has not been immune from this global economic story. Our reliance on China is well known. Chinese trade activity has certainly been affected and the major wool buyers were notably absent this week. There did seem to be a little more interest late in the sale Thursday but this didn’t ease the negative sentiment that had dominated the opening sale. 16.0 micron was least affected and even closed fully firm yesterday. It was the standard Chinese types 19.0 to 21.5 micron that lacked the usual competition. 29% of the total national offering was passed in.

AWEX Eastern Indicator compared with 12/07/2019

Eastern Indicator

Close: 1676

Change in % -4.45%

If you want to learn more about AWEX indicators, visit the official website http://www.awex.com.au

Schneider Indicators

The Schneider Indicators are currently being reviewed to provide index values that will better reflect our evolving business. Details and launch in coming weeks. Our apologies to those who rely on these values for market information.

15 Micron

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16 Micron

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17 Micron

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18 Micron

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19 Micron

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Forecast

Very few are able to comment on the non mulesed market like we can. G Schneider Australia tends to dominate the offering of NM certified wool from 18.5 to 20.5 micron. This week our prices for NM wool around 19.0 /20.0 micron were only 2% down on the previous sale in July. This compares with an AWEX MPG value for 19.0 micron which was closer to 6% down. Clearly NM wool is selling in a different market and attracting a wider range of buyer interest who are influenced by longer term delivery and supply chain relationships.

Auction offering – current week

Selling Centres for week 07

Market          Sale          Offered             Sold       Passed In

North                    S 07                      13059                       10490              19.7%

South                   M 07                      21125                        15726               25.6%

West                     F 07                        7359                          3425                53.5%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 08                        W-T                          13984

South                      M 08                       W-T                          21231

West                        F 08                        W-T                           8388

 

If you want to see the complete Wool Sales Roster click here.

AUSTRALIAN WEEKLY MARKET REPORT

Comment

Sales have concluded for the 2018/2019 season on a relatively poor tone, albeit with prices still at reasonably good levels for wool production. The market this season has taught us that nothing is for certain. Chinese demand changed from fine wool to crossbreds very quickly and then the market appetite for wool altogether changed quite suddenly in recent weeks. The focus on non mulesed wool has improved dramatically, almost to a point that NM certified wool according to the National Wool Declaration is creating its own market and not following the trend of the other types on offer. There have been some very high-quality NM wool clips on offer that are still attracting widespread support from a different demand base and this is protecting those types more than others, from the current market instability.

AWEX Eastern Indicator compared with 20/06/2019

Eastern Indicator

Close: 1715

Change in % -2.88%

If you want to learn more about AWEX indicators, visit the official website http://www.awex.com.au

Schneider Indicators compared with 20/06/2019

↓15 Micron

Close: 2,403

Change in %: -2.70%

↓16 Micron

Close: 2,137

Change in %: -3.23%

↓17 Micron

Close:  2,159

Change in %: -0.46%

↓18 Micron

Close: 2,055

Change in %: -0.39%

↓19 Micron

Close: 2,047

Change in %: -2.39%%

 

Each indicator is expressed by a number representing a market quotation for a selected range of types and is not a price expression and it’s not influenced by currency fluctuations.

Wool indicators are anyway based on Australian Dollar.

If you want to learn more about SCHNEIDER indicators Click here.

Forecast

The ups and downs of this season must be a warning to wool producers that they should be looking to align themselves as much as possible with their customers demands. The interest in relationships and traceability back to farm is increasing.

The current market trend seems more a global issue and not focused only on wool. Consumer confidence as a result of political positioning is affecting business confidence and the attitude towards investment and risk. This is no doubt affecting wool that has a long supply chain and a very high level of investment for all involved. Two weeks of sales remain before our three-week mid-year recess.

Auction offering – current week

Selling Centres for week

Market          Sale          Offered             Sold       Passed In

North                    S 52                      7859                          6526                 17.0%

South                   M 52                     14995                        12513                 16.6%

West                     F 52                        6313                          4293                 32.0%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 01                        W-T                          13608

South                      M 01                       W-T                          12127

West                        F 01                        W-T                           8769

 

If you want to see the complete Wool Sales Roster click here.

AUSTRALIAN WEEKLY MARKET REPORT

Comment

When we have exceptionally small national quantities, the market is often neglected and this was the case this week. Not only were the volumes small (19,000 bales offered), the selection was again very poor. A large percentage of very low yielding, drought affected types. These wools are not only inferior in quality, they are more expensive to transport with less clean weight per bale and processing tariffs on lower yielding types are higher. The range of price between microns is now small with little discount down to 21.5 micron. This should help to limit further downside on the fine types and it was more noticeable on Thursday that the level of interest had improved at this lower basis. This however has unfortunately been the trend in recent weeks. The opening day lower, the second day firm.

AWEX Eastern Indicator compared with 14/06/2019

Eastern Indicator

Close: 1766

Change in % -3.13%

If you want to learn more about AWEX indicators, visit the official website http://www.awex.com.au

Schneider Indicators compared with 14/06/2019

↓15 Micron

Close: 2,468

Change in %: -1.05%

↓16 Micron

Close: 2,206

Change in %: -2.13%

↓17 Micron

Close:  2,169

Change in %: -0.32%

↓18 Micron

Close: 2,063

Change in %: -2.62%

↑19 Micron

Close: 2,096

Change in %: +1.34%

 

Each indicator is expressed by a number representing a market quotation for a selected range of types and is not a price expression and it’s not influenced by currency fluctuations.

Wool indicators are anyway based on Australian Dollar.

If you want to learn more about SCHNEIDER indicators Click here.

Forecast

The wool prices in USD must now appear much more attractive. The AWEX EMI in USD terms is now at the lowest level since October 2017. We know how limited supply will be in the next season, the lowest in almost 100 years. All we need is for a little more confidence to return to the market. Buyers and traders are also reluctant to sell too far forward with concerns over supply and cash flow must be restricting many participants. Of increasing concern to Australian wool producers must be the appetite of our clients to source a lot more merino wool from other country origins now when compared to a few years ago. There is no doubt that this is a mulesing issue but we are also seeing a push from global brands on environmental standards and accountability.

Auction offering – current week

Selling Centres for week

Market          Sale          Offered             Sold       Passed In

North                    S 51                      8098                          7123                 12.0%

South                   M 51                     10974                          9511                 13.3%

West                     F 51                      no sale

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 52                        W-T                          8073

South                      M 52                       W-T                         15573

West                        F 52                        W-T                          7226

 

If you want to see the complete Wool Sales Roster click here.

AUSTRALIAN WEEKLY MARKET REPORT

Comment

Demand slowed again this week as the small offering as well as the still drought affected wools are having an impact. With a large percentage of the offering having poor spec and very low yield, exporters are finding these types harder to place orders. These poorest style wools saw the largest loss over the week. Growers were very resistant to the fall in prices with 21.3% of the entire offering passed in. The better spec and yielding wools were less affected, whilst those with best style were barely affected as a real gap has begun to emerge between quality.

AWEX Eastern Indicator compared with 07/06/2019

Eastern Indicator

Close: 1823

Change in % -2.20%

If you want to learn more about AWEX indicators, visit the official website http://www.awex.com.au

Schneider Indicators compared with 07/06/2019

↓15 Micron

Close: 2,494

Change in %: -1.84%

↓16 Micron

Close: 2,253

Change in %: -2.35%

↓17 Micron

Close:  2,176

Change in %: -2.48%

↓18 Micron

Close: 2,117

Change in %: -2.36%

↓19 Micron

Close: 2,068

Change in %: -1.06%

 

Each indicator is expressed by a number representing a market quotation for a selected range of types and is not a price expression and it’s not influenced by currency fluctuations.

Wool indicators are anyway based on Australian Dollar.

If you want to learn more about SCHNEIDER indicators Click here.

Forecast

Sales will take a break once again this week in Fremantle seeing the national offering drop back again to just 19,745.

As the drought continues across much of NSW and QLD the generally poor offering will continue for the foreseeable future. There is a generally small national offering forecast for the next couple of weeks leading into the three week recess. Hopefully this can stimulate the market a little as buyers need to complete orders and look to have enough wool to keep the machines running through the recess.

Auction offering – current week

Selling Centres for week

Market          Sale          Offered             Sold       Passed In

North                    S 50                      7923                          6841                  13.7%

South                   M 50                     14256                        11757                 17.5%

West                     F 50                      5961                          3562                  25.0%

 

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 50                        W-T                          8327

South                      M 50                       W-T                          11418

West                        No Sale

 

If you want to see the complete Wool Sales Roster click here.

AUSTRALIAN WEEKLY MARKET REPORT

Comment

Currency markets are fluctuating a little and this is impacting on market confidence. The AWEX EMI was down just 7 USC (0.5%) for the week but 1.2% lower in local currency. The smaller volume offering, just 21,000 bales nationally, wouldn’t have helped. And furthermore, 15% of those were passed in, resulting in just 18,000 bales being sold to the trade for the week. Topmakers seem to be taking the most advantage of the more subdued tone in the auction room. The small offering of better yielding and performing types were largely unchanged but all other descriptions were irregular.

AWEX Eastern Indicator compared with 31/05/2019

Eastern Indicator

Close: 1864

Change in % -1.22%

If you want to learn more about AWEX indicators, visit the official website http://www.awex.com.au

Schneider Indicators compared with 31/05/2019

↑15 Micron

Close: 2,540

Change in %: +0.24%

↓16 Micron

Close: 2,306

Change in %: -1.86%

↓17 Micron

Close:  2,230

Change in %: -1.75%

↓18 Micron

Close: 2,167

Change in %: -0.32%

↓19 Micron

Close: 2,090

Change in %: -2.01%

 

Each indicator is expressed by a number representing a market quotation for a selected range of types and is not a price expression and it’s not influenced by currency fluctuations.

Wool indicators are anyway based on Australian Dollar.

If you want to learn more about SCHNEIDER indicators Click here.

Forecast

Sales in Fremantle will be on again next week after a one-week break. It’s a very quiet time of the year in Western Australia and each year there are a few weeks during this period without sales.

The drought continues in parts of NSW. Lambing numbers were significantly affected last year and young weaner weathers are being sold as we move into winter without sufficient grass cover. This will impact further on wool production this year, particularly in the New England region where the Italian market often relies on heavily for volume of quality types.

Auction offering – current week

Selling Centres for week 49

Market          Sale          Offered             Sold       Passed In

North                    S 49                      9495                          8162                  14.0%

South                   M 49                     12249                        10218                 16.6%

West                     F 49                      no sale

 

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 50                        W-T                          8242

South                     M 50                       W-T                          15136

West                       F 50                        W-T                            6611

 

If you want to see the complete Wool Sales Roster click here.

AUSTRALIAN WEEKLY MARKET REPORT

Comment

What a clear difference the one week can make. Buyer confidence returned and it didn’t take much to push the AWEX EMI nearly 3% dearer. Less than 30,000 bales were offered. Passed in rates were much lower as growers are more comfortable selling into a strong market. There was positive news regarding the sale of tops and greasy wool coming out of China late last week and the expectations of a dearer market came to fruition. It’s clear what difference just a little improvement in confidence can have when considering the volume and type of wool on offer. The Chinese focus was on 19.5 and broader plus the most inferior types. The overall price gap between best, worst, finest and broadest, is now at the smallest range for the season to date. As is often the case when the market is changing, the cardings move first, locks were as much as 8% dearer.

AWEX Eastern Indicator compared with 24/05/2019

Eastern Indicator

Close: 1887

Change in % +2.95%

If you want to learn more about AWEX indicators, visit the official website http://www.awex.com.au

Schneider Indicators compared with 24/05/2019

15 Micron

Close: 2,534

Change in %: -0.2%

↑16 Micron

Close: 2,349

Change in %: +0.51%

↑17 Micron

Close:  2,269

Change in %: +1.63%

↑18 Micron

Close: 2,174

Change in %: +0.51%

↑19 Micron

Close: 2,132

Change in %: +0.94%

 

Each indicator is expressed by a number representing a market quotation for a selected range of types and is not a price expression and it’s not influenced by currency fluctuations.

Wool indicators are anyway based on Australian Dollar.

If you want to learn more about SCHNEIDER indicators Click here.

Forecast

Growers are more likely to sell now. Historically an improvement in market confidence like this week would flush out volume for sale, but still just 23,000 bales are currently rostered for each of the next two weeks and less than 20,000 bales in week 51. No doubt, the first sale in July will be a larger one, the first of the new financial year, but we also have the three-week recess to consider in July. Anyone who needs wool either for prompt demand or to feed machinery will have little option but to buy. To wait would seem a risky proposition with the market volatility seen in recent times.

Auction offering – current week

Selling Centres for week 48

Market          Sale          Offered             Sold       Passed In

North                    S 48                      7864                          7459                  5.2%

South                   M 48                     16418                        14972                  8.8%

West                     F 48                      3991                           3470                  13.1%

 

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 49                        W-T                          10391

South                     M 49                       W-T                           13228

West                       F 49                      no sale

 

If you want to see the complete Wool Sales Roster click here.

AUSTRALIAN WEEKLY MARKET REPORT

Comment

Buyers are not confident to accumulate as downstream demand remains slow. Just 17,000 bales were sold to the trade but to place it into perspective, the weekly turnover was still M$32.7. Not bad considering the general gloomy outlook. We did notice much greater confidence return to the market yesterday. Bidding activity was stronger from a wider range of buyers. For the first time in several weeks, the more inferior types outperformed the better types in terms of market movement yesterday. The tender and lower yielding types were all 1% dearer with some perceived value at these levels entering the mindset of traders and topmakers. The AWEX merino carding indicator (MC) is now at the 19% percentile for 5 years. Meaning that prices have only been lower 18% of the time in 5 years. The market in this sector has certainly been affected but we remain confident that it will improve quickly. Supply of merino cardings will be more affected than most types when considering we will be at the lowest level of supply in 100 years within the next 12 months.

AWEX Eastern Indicator compared with 17/05/2019

Eastern Indicator

Close: 1833

Change in % -3.17%

If you want to learn more about AWEX indicators, visit the official website http://www.awex.com.au

Schneider Indicators compared with 17/05/2019

15 Micron

Close: 2,539

Change in %: 0%

16 Micron

Close: 2,337

Change in %: -2.44%

17 Micron

Close:  2,232

Change in %: -4.08%

18 Micron

Close: 2,163

Change in %: -3.28%

19 Micron

Close: 2,112

Change in %: -2.32%

 

Each indicator is expressed by a number representing a market quotation for a selected range of types and is not a price expression and it’s not influenced by currency fluctuations.

Wool indicators are anyway based on Australian Dollar.

If you want to learn more about SCHNEIDER indicators Click here.

Forecast

We keep focusing on supply, and for good reason. With 31,000 bales next week followed by as little as 20,000 nationally the week after we would expect the market to be performing better. It’s a difficult period, prices are easing and it’s obviously a moment to be cautious but some customers who are planning for the next season will start to make some enquiries at these reduced levels. It would provide some security to have something covered while others are reluctant to even consider it. Growers are still greatly suffering from the drought and have shown a very clear tendency to hold wool rather than to sell it in a falling market.

Auction offering – current week

Selling Centres for week 47

Market          Sale          Offered             Sold       Passed In

North                    S 47                      6900                          5066                  26.6%

South                   M 47                     12833                         9992                  22.1%

West                     F 47                      4388                           2250                  48.7%

 

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 48                        W-T                           8984

South                     M 48                       W-T                           17696

West                       F 48                        W                                4784

 

If you want to see the complete Wool Sales Roster click here.

AUSTRALIAN WEEKLY MARKET REPORT

Comment

The lifting of the ban on exports from South Africa to China this week was a very good result for all concerned. It was a difficult period for the industry, particularly for those directly involved, but also the broader wool community. Whenever the normal flow of wool is compromised by external forces, uncertainty is created. Available finance has been pushed to the limit and variable market prices between the countries made trading conditions extremely difficult. The fact that the South African wool was selling at a discount to Australian prices until now, meant that the lifting of the ban must have been a strong influencing factor determining the direction of the market in Australia this week. Demand through the pipeline was already very poor. Now that the flow of wool is more transparent, we hope to see standard supply and demand factors to play out and for more confidence to return. Just 26,000 bales were eventually sold this week with 21% passed in rate. Growers backing their judgement that prices will remain stable in the medium term as supply will be very restricted. Less than 4,000 bales were sold in Fremantle with 45% of the merino fleece failing to meet grower expectations and will remain in store for another day.

AWEX Eastern Indicator compared with 10/05/2019

Eastern Indicator

Close: 1893

Change in % -3.02%

If you want to learn more about AWEX indicators, visit the official website http://www.awex.com.au

Schneider Indicators compared with 10/05/2019

15 Micron

Close: 2,539

Change in %: -5.24%

16 Micron

Close: 2,394

Change in %: -2.59%

17 Micron

Close:  2,323

Change in %: -2.67%

18 Micron

Close: 2,234

Change in %: -2.51%

19 Micron

Close: 2,161

Change in %: -2.22%

 

Each indicator is expressed by a number representing a market quotation for a selected range of types and is not a price expression and it’s not influenced by currency fluctuations.

Wool indicators are anyway based on Australian Dollar.

If you want to learn more about SCHNEIDER indicators Click here.

Forecast

The staple strength of the offering is actually quite good. According to AWEX figures, despite the drought, one third of the merino fleece offered this week was >40nkt and more than half of the merino fleece with a mid-break < than 50%. It’s the yield that is most restrictive to buyers for China in particular. The cheaper Australian dollar failed to add any support to wool prices.

Auction offering – current week

Selling Centres for week 46

Market          Sale          Offered             Sold       Passed In

North                    S 46                      8431                          7052                   16.4%

South                   M 46                     18302                       15097                  17.5%

West                     F 46                      6420                         3816                   40.6%

 

Auction offering – next week

Market          Sale          Sale days          Volume

North                   S 47                        W-T                             7100

South                   M 47                       W-T                           14032

West                     F 47                        W                                4505

 

If you want to see the complete Wool Sales Roster click here.

AUSTRALIAN WEEKLY MARKET REPORT

Comment

A softening market trend this week in a another very disappointing offering. The impact of the drought on quality and quantity so far this season has been immense. Only 33,000 bales were offered and, on both days, the average market eased a little. The few better lines are attracting competition from a wider range of buyers and are clearly less affected. The EMI lost only 8c this week as crossbred wools continue upward with Chinese demand for these types outweighing supply.

AWEX Eastern Indicator compared with 02/05/2019

Eastern Indicator

Close: 1952

Change in % +0.41%

If you want to learn more about AWEX indicators, visit the official website http://www.awex.com.au

Schneider Indicators compared with 02/05/2019

 15 Micron

Close: 2,672

Change in %: 0.00

16 Micron

Close: 2,456

Change in %: 0.16%

17 Micron

Close:  2,385

Change in %: +0.75

18 Micron

Close: 2,290

Change in %: -1.40

19 Micron

Close: 2,209

Change in %: +0.36

 

Each indicator is expressed by a number representing a market quotation for a selected range of types and is not a price expression and it’s not influenced by currency fluctuations.

Wool indicators are anyway based on Australian Dollar.

If you want to learn more about SCHNEIDER indicators Click here.

Forecast

The general cautious tone across the wool industry isn’t necessarily playing out in the same way on greasy wool prices. It’s been a very difficult trading period. Wool prices are lower, yet relatively stable when considering the reduction in enquiry from our customers. Perhaps this is now starting to change the thought process of those who either need some wool for prompt production or prepare for the new season.

Auction offering – current week

Selling Centres for week 45

Market          Sale          Offered             Sold       Passed In

North                    S 45                      8005                       7303                   8.8%

South                   M 45                     18367                      16006                 12.9%

West                     F 45                      6429                        5267                   18.1%

 

Auction offering – next week

Market          Sale          Sale days          Volume

North                   S 46                        W-T                             8556

South                   M 46                       W-T                            18726

West                     F 46                        W-T                             6079

 

If you want to see the complete Wool Sales Roster click here.