AUSTRALIAN WEEKLY MARKET REPORT

Comment

There seems enough interest to source greasy wool coming from the Chinese sector but the current market volatility is resulting in extreme caution on price being shown by the customers. This in turn is affecting profitability and limiting traders willingness to take risk. Whenever the market shows an inclination for strengthening, it brings more optimistic buying activity. The moment it softens, the sales stop. But because the market is reacting in weekly patterns like this, up and down with regularity, we are of the opinion that wool is needed in the short term. The risk of being caught on the wrong side for price as a result of the volatility is the problem.

AWEX Eastern Indicator compared with 15/11/2019

Eastern Indicator

Close: 1555

Change in % -1.21

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

Authentico Index Values

15 Micron

Close: 2435

Change in %: -4.21

16 Micron

Close: 2275

Change in %: -2.49

17 Micron

Close: 2134

Change in %: -2.15

18 Micron

Close: 2024

Change in %: -1.94

19 Micron

Close: 1931

Change in %: -1.73

Authentico Indicator

Close: 2139

Change in %: -2.37

Forecast

The market tone on Thursday was completely different to that early Wednesday. With the market finishing strongly on Wednesday, this flowed through to Thursday and we were of the opinion that the market was better than it was reported on Thursday. Quite clearly, sitting in the sale room, it was a different and much more positive environment.

Auction offering – current week

Selling Centres for week 21

Market          Sale          Offered             Sold       Passed In

North                      S 21                      9666                        8444                  12.6%

South                     M 21                     17535                      15290                  12.8%

West                       F 21                       8518                         6488                 23.8%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 22                       W-T                           10597

South                      M 22                      W-T                           21380

West                        F 22                       W-T                            7303

 

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

AUSTRALIAN WEEKLY MARKET REPORT

Comment

Market volatility continued this week with a reversal of last week’s easing trend. Prices got off to a stronger start and stabilised on Thursday after overacting just a little late on Wednesday. All in all, it was a more promising market tone this week, particularly for the finer microns. It was the better lots 15.5 / 17.0 micron that attracted the most attention with the Chinese focus supported strongly from European interests. Our Authentico indicators performed in line with the general market for 15.0 / 17.0 micron but typically, our index values are more stable than the general market for 18.0 and 19.0 micron.

AWEX Eastern Indicator compared with 8/11/2019

Eastern Indicator

Close: 1574

Change in % +1.22

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

Authentico Index Values

15 Micron

Close: 2542

Change in %: +1.72

16 Micron

Close: 2333

Change in %: +2.32

17 Micron

Close: 2181

Change in %: +2.59

18 Micron

Close: 2064

Change in %: +0.98

19 Micron

Close: 1965

Change in %: +0.98

Authentico Indicator

Close: 2191

Change in %: +1.81

Forecast

There was more interest from the Chinese sector this week, as mentioned in our weekly comment, this was more focused on the finer merinos. We’ve said for a while now that they have appeared better value. Now that selection is slowing for the better fine wool, if interest from China is maintained, we remain positive for this market. Production is particularly affected in this range, specifically when considering quality types.

Our thoughts are with our wool grower friends now battling bush fires after lengthy period of drought and costly supplementary feed bills. Their resilience in these times is extraordinary and our support and best wishes for a satisfactory outcome.

Auction offering – current week

Selling Centres for week 20

Market          Sale          Offered             Sold       Passed In

North                      S 20                      9781                        9139                   6.6%

South                     M 20                     19985                      18741                  6.2%

West                       F 20                       6344                         5704                 10.1%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 21                       W-T                           10015

South                      M 21                      W-T                           21779

West                        F 21                       W-T                            8932

 

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

AUSTRALIAN WEEKLY MARKET REPORT

Comment

The market on average got off to a softer tone on Wednesday despite the generally good result for all better specification wools which closed generally firm. Wool of 16.0 micron and finer continue to be in demand. Not surprising, those clips certified non mulesed continue to sell with more consistent demand and are not exposed to the general volatility experienced by the overall market through this period. Our Authentico index fell just 0.5% for the week with the 19.0 range the most affected.

AWEX Eastern Indicator compared with 1/11/2019

Eastern Indicator

Close: 1555

Change in % -2.45

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

Authentico Index Values

15 Micron

Close: 2499

Change in %: -1.07

16 Micron

Close: 2280

Change in %: -0.04

17 Micron

Close: 2126

Change in %: -0.56

18 Micron

Close: 2044

Change in %: -0.24

19 Micron

Close: 1946

Change in %: -1.81

Authentico Indicator

Close: 2152

Change in %: -0.51

Forecast

Some general rain fell across eastern Australia. Some regions received more than others. For many it wasn’t drought breaking but our rural friends and colleagues all remain positive that a shift in the ongoing dry trend is changing. We are seeing some good consistent volumes on offer at the moment but just the six sale weeks remain up to Christmas. Volatility is likely to continue. We expect that some still need to buy wool soon and with the Fremantle auction finishing positively on Thursday, we hope that this will be good lead into next week.

Auction offering – current week

Selling Centres for week 19

Market          Sale          Offered             Sold       Passed In

North                      S 19                      9332                        8284                  11.2%

South                     M 19                     16788                       13918                 17.1%

West                       F 19                       7964                         5910                 25.8%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 20                       W-T                           10399

South                      M 20                      W-T                           20753

West                        F 20                       W-T                            7345

 

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

AUSTRALIAN WEEKLY MARKET REPORT

Comment

Following from last week’s positive lead, prices strengthened across the board on Wednesday and followed with a more stabilising market on Thursday. There was no doubt that the confidence shown in the auction room on Wednesday was much greater than we’ve seen in recent months and this was a welcome sign. As the AUD strengthened against the USD overnight Wednesday, there was a little more caution shown on Thursday but prices settled to be around about the same level on average. The better type and specification types were a little dearer and the average strength Chinese qualities a little irregular and cheaper. Fremantle opened cheaper than the east on Thursday but it was noted that the market improved towards the close of sale in that centre. Crossbred and carding types were event more keenly sought after than the merino combing types.

AWEX Eastern Indicator compared with 25/10/2019

Eastern Indicator

Close: 1594

Change in % +3.17

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

Authentico Index Values

15 Micron

Close: 2526

Change in %: +4.21

16 Micron

Close: 2281

Change in %: +3.40

17 Micron

Close: 2138

Change in %: +2.59

18 Micron

Close: 2049

Change in %: +1.59

19 Micron

Close: 1982

Change in %: +1.48

Authentico Indicator

Close: 2163

Change in %: +2.46

Forecast

If the current market trend continues, in the next few weeks we’ll slowly but surely shift some of the grower held wool onto the market. The availability of wool over the next four weeks is currently forecast to be greater than the same period last year. It has been an orderly approach to marketing this year despite the extreme volatility in price. On the occasion of dramatic falls, we’ve seen up to 50% of the fleece wool offered for sale being passed in. Likewise, when we have expected a better market, we haven’t seen a huge volume of held bales flood the auction. We are constantly encouraged by the greater communication between buyers and sellers these days and a maturing supply chain as a result. Let’s hope that this sensible approach continues towards Christmas. A less volatile market over a sustained period will add some much-needed confidence.

Auction offering – current week

Selling Centres for week 18

Market          Sale          Offered             Sold       Passed In

North                      S 18                      8946                        8561                  4.3%

South                     M 18                     17958                       17139                 4.6%

West                       F 18                       8396                        7308                 13.0%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 19                       W-T                            9515

South                      M 19                      W-T                          18386

West                        F 19                       W-T                           8596

 

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

AUSTRALIAN WEEKLY MARKET REPORT

Comment

There was welcome interest from the local traders with small but more consistent interest coming from China. We’re pleased that the band that the market is reacting within is now much smaller compared to last month. The better types and the most inferior types were the least affected as the typical Chinese qualities were in favour this week. Again, of interest to our group was the focus on 16.5 micron and finer. This is a micron range that is typically sought after by Italian weavers. For some time now they have appeared good value and as the Chinese focus remains on 18.5 and broader, it was only a matter of time before some trade activity shifted to the finer microns for value. Demand for the finer microns for more formal suiting has been reduced quite dramatically this season. So, perhaps this is a good sign of some market improvement in this sector.

AWEX Eastern Indicator compared with 18/10/2019

Eastern Indicator

Close: 1545

Change in % +1.85

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

Authentico Index Values

15 Micron

Close: 2424

Change in %: +0.75

16 Micron

Close: 2206

Change in %: -0.18

17 Micron

Close: 2084

Change in %: +1.17

18 Micron

Close: 2017

Change in %: +0.95

19 Micron

Close: 1953

Change in %: +2.63

Authentico Indicator

Close: 2109

Change in %: +0.91

Forecast

Looking into AWEX EMI data back to 2010 we note a regular spike in the AWEX EMI around early to mid-October. The omissions were 2018 and 2011 both strong market years and prices in those years were coming from high levels in the preceding months. In 2010, 2012, 2014, 2015 ,2016 and 2017 the EMI showed a strengthening trend to a stronger market in the month of October that was maintained through the following period and into the next calendar year. It’s with extraordinary regularity that this occurred. In 2013, the market was flat all year so that was another anomaly. Will the tide change with the recent few weeks stability and the better market tone this week? Fremantle sale finished stronger than the eastern state close.

Auction offering – current week

Selling Centres for week 17

Market          Sale          Offered             Sold       Passed In

North                    S 17                        4972                         4577                   7.9%

South                   M 17                      15498                        14627                  5.6%

West                     F 17                        6607                          6057                  8.3%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 18                       W-T                            9577

South                      M 18                      W-T                          21461

West                        F 18                       W-T                           8408

 

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

AUSTRALIAN WEEKLY MARKET REPORT

Comment

Most market reports will alert to continued volatility this week but we are of the opinion that the better prepared clips, particularly those with NM or CM status, remain much more stable. We found only a small movement in our Authentico index’s this week, all moving between 0.3 and 1% up or down. There was a larger superfine selection this week and they were the wools that performed the best. The 15.0 to 17.5 micron range was well supported. The AWEX EMI didn’t fare as well, minus 1.7% for the week, but this would have been influenced by a poor performance in the crossbred sector which eased as the sale progressed.

AWEX Eastern Indicator compared with 11/10/2019

Eastern Indicator

Close: 1517

Change in % -1.69

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

Authentico Index Values

15 Micron

Close: 2406

Change in %: -0.91

16 Micron

Close: 2210

Change in %: -1.03

17 Micron

Close: 2060

Change in %: +0.34

18 Micron

Close: 1998

Change in %: +0.30

19 Micron

Close: 1903

Change in %: -0.31

Authentico Indicator

Close: 2090

Change in %: -0.19

Forecast

A smaller sale next week with 33,000 bales rostered for sale including a one-day sale (Wednesday) in Sydney. This is unusual for this time of the season and an indication of the general supply trend.

Auction offering – current week

Selling Centres for week 16

Market          Sale          Offered             Sold       Passed In

North                    S 16                      10143                         9060                 10.7%

South                   M 16                      17625                        15036                 14.7%

West                     F 16                        7588                          6093                 19.7%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 17                         W                              5425

South                      M 17                      W-T                          19371

West                        F 17                       W-T                           8174

 

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

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AUSTRALIAN WEEKLY MARKET REPORT

Comment

Activity was clearly more focused on the Chinese specification types this week. The largest percentage change was on the tender and more average performing wool types. These are usually the first to react in any market change and typically are the most volatile. Our better types for our Italian weaver clients were generally very firm this week. The better style and strength types are not as exposed to the volatility in the current market. This was the same for the Authentico clips. They didn’t move much, in fact even slightly easier in the 17.5 / 19.0 range as the general market activity was dominated by those seeking wool at a price. It was a very welcome sign though. This activity resulted in one of the more stable overall market trends in recent weeks if not months.

AWEX Eastern Indicator compared with 4/10/2019

Eastern Indicator

Close: 1543

Change in % +2.12

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

Authentico Index Values

15 Micron

Close: 2428

Change in %: +0.37

16 Micron

Close: 2233

Change in %: +1.59

17 Micron

Close: 2053

Change in %: -1.39

18 Micron

Close: 1992

Change in %: -0.69

19 Micron

Close: 1909

Change in %: -1.34

Authentico Indicator

Close: 2094

Change in %: -0.33

Forecast

We have another designated superfine sale in Sydney next week. These sales are becoming less dominated by superfine clips as growers look to sell into a positive market tone as a preference over when they have traditionally offered their wool. Even considering this, we do expect a few more superfine clips. The New England region is suffering from an extended and brutal drought. This is forcing further reductions in sheep numbers added to reduced cut per head, lower lambing percentages and increasing feed costs. The real cost of this on the level of production is still a long way from being realised. These woolgrowers must be commended for their resolve and commitment to wool growing and the welfare of their sheep in such difficult times.

Auction offering – current week

Selling Centres for week 15

Market          Sale          Offered             Sold       Passed In

North                    S 15                       6753                          6352                  5.9%

South                   M 15                      15151                         14238                 6.0%

West                     F 15                        6245                          5425                 13.1%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 16                        W-T                           11113

South                      M 16                       W-T                          21108

West                        F 16                        W-T                           7835

 

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

AUSTRALIAN WEEKLY MARKET REPORT

Comment

The soft lead from Fremantle last Thursday ensured the opening of this week’s market was negative. The variation in price from week to week and day to day is compounding the confusion and subsequent difficulty in managing all buying and selling decisions. The level of price is not necessarily under question, it’s the variation and the uncertainty that this movement is creating. This is impacting on the general trading environment from farm through the entire supply chain. It’s a global market and with prices easing in South Africa to levels well below our close on Wednesday, this flowed through to the Australian market on Thursday.

AWEX Eastern Indicator compared with 27/09/2019

Eastern Indicator

Close: 1511

Change in % -6.09

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

Authentico Index Values

15 Micron

Close: 2419

Change in %: -3.74

16 Micron

Close: 2198

Change in %: -5.98

17 Micron

Close: 2082

Change in %: -4.94

18 Micron

Close: 2006

Change in %: -3.04

19 Micron

Close: 1935

Change in %: -3.44

Authentico Indicator

Close: 2101

Change in %: -4.28

Forecast

Some would be critical of the spike in the volume of wool offered nationally this week even if it was just 37,000 bales offered across all three centres. Not large by any measure but still 37% or 10,000 more bales than last week. AWEX auction data to week 14 indicates there has been 27.5% fewer bales of first hand grower wool offered this season compared to last year. AWTA test data to end September indicated a fall in tested volume of 14% compared to end September 2018 and yet the Australian Wool Production Forecast Committee met in August and predicted a fall of just 5% for the full year. Some widely variable figures.

We would have preferred a smaller sale this week once we understood the market was to open lower but brokers lot the wool for sale and provide volumes in the middle of the week prior, when the market was positive. Also, we can’t decline the grower the opportunity to offer their wool for sale and the auction system is at least very transparent in terms of what is available. Some growers are in the middle of the worst drought on record, are desperate for cash and prices are still considered acceptable if only the wild fluctuations would settle. We must understand growers have the right to choose when to sell their wool, like buyers have the right to choose if they buy. It’s just a very unfortunate and difficult period we need to work through compounded by global economic uncertainty.

Auction offering – current week

Selling Centres for week 14

Market          Sale          Offered             Sold       Passed In

North                    S 14                       9512                          6992                 26.5%

South                   M 14                      16737                        11010                 34.2%

West                     F 14                        7299                          4321                 40.8%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 15                        W-T                            8341

South                      M 15                       W-T                           18085

West                        F 15                        W-T                            7748

 

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

AUSTRALIAN WEEKLY MARKET REPORT

Comment

A small national volume and mixed reports coming from China added to more confusion leading into the sale. Prices were expected to open strongly and they did. Typically though, with supply as limited as it is, the market is reacting with more volatility than we would have expected in the past. This eventually added more confusion and prices settled in Fremantle on Thursday. The Fremantle and Melbourne auction centres don’t have the volume of typical Italian weaver types and we’re finding that these types are not moving with such volatility. Interest and demand for wool types that meet Authentico standards are attracting more consistent competition and these types were least affected. Of particular note was the best 15.5/16.0 micron range of Authentico types. Those with good style and specification attracted strong competition from a range of Italian interests.

AWEX Eastern Indicator compared with 20/09/2019

Eastern Indicator

Close: 1609

Change in % +4.34

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

Authentico Index Values

15 Micron

Close: 2513

Change in %: +1.17

16 Micron

Close: 2338

Change in %: +4.42

17 Micron

Close: 2184

Change in %: +2.13

18 Micron

Close: 2069

Change in %: +1.27

19 Micron

Close: 2004

Change in %: +3.73

Authentico Indicator

Close: 2195

Change in %: +2.38

Forecast

With prices in Fremantle settling below the close of Sydney and Melbourne and an increase to 40,000 bales next week, we could expect a softer opening tone. Growers will likely exercise their option to reserve their wool at a minimum price and if bidding doesn’t get to those levels, they are likely to keep it for another week. This is what they’ve done quite well in recent weeks. Our policy to maintain a steady and sensible approach to buying and selling will continue. None of us are able to accurately predict the top or bottom of this market with such volatility.

Auction offering – current week

Selling Centres for week 13

Market          Sale          Offered             Sold       Passed In

North                    S 13                       7184                          6983                  2.8%

South                   M 13                      13525                        12979                 4.0%

West                     F 13                        6749                          5422                 19.7%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 14                        W-T                           10464

South                      M 14                       W-T                           21758

West                        F 14                        W-T                            8777

 

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

AUSTRALIAN WEEKLY MARKET REPORT

Comment

Finally, a bit of stability in the market. Prices settled on Wednesday a little above the close in Fremantle from the previous week. That basis was the most recent to go on and the one most chose to compare against considering the extreme volatility of last week. With many local traders in China for the Nanjing Wool Conference, it was pleasing to see a small improvement from that basis on Thursday. All in all it must be considered a very positive result.

AWEX Eastern Indicator compared with 13/09/2019

Eastern Indicator

Close: 1542

Change in % +0.46

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

Authentico Index Values

15 Micron

Close: 2484

Change in %: +1.72

16 Micron

Close: 2239

Change in %: +0.49

17 Micron

Close: 2139

Change in %: +2.59

18 Micron

Close: 2043

Change in %: +0.89

19 Micron

Close: 1932

Change in %: -0.51

Authentico Indicator

Close: 2144

Change in %: +1.28

Forecast

Sale volumes remain small and while we acknowledged some wool was passed in and withdrawn in recent weeks, it’s not coming back onto the market in any great numbers. Some were of the opinion that this factor might be a negative for the market but as yet it’s not impacting on sale volumes nor the market. There will be less than 30,000 bales offered for sale next week. The relative stability around these levels is encouraging more interest from our clients. The market from October is generally quite positive historically and we see no reason for this not to continue this season.

Auction offering – current week

Selling Centres for week 12

Market          Sale          Offered             Sold       Passed In

North                    S 12                       8668                          7973                  8.0%

South                   M 12                      15027                         13233                11.9%

West                     F 12                        6440                          5801                  9.9%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 13                        W-T                            7559

South                      M 13                       W-T                           14904

West                        F 13                        W-T                            6827

 

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