AUSTRALIAN WEEKLY MARKET REPORT

Comment

The market attention shifted towards the medium and broader merino types this week. While not for the first time, there was word around of pending Chinese uniform orders. There was obvious interest coming from outside of China, even if in small volume, it was enough competition to stimulate the market. There is also the usual swing between micron groups as the price and selection of fine wool has pushed the price a little out of reach for some. The decision for the buyer focus in the 19.0 micron and broader range this week could be based primarily on market price. The small supply of fine wool at the moment resulted in sustained pressure on fine wool prices regardless.

A strong Australian dollar, generally influenced by commodity prices and global confidence, was expected to dampen the wool market this week but it had little effect with prices in USD values increasing more than in AUD values. The AWEX EMI (AUD) is now at the highest level since end March 2020 but still a way off the peak in January, just prior to the shock that was to arrive on the global stage shortly after.

AWEX Eastern Indicator compared with 23/04/2021

Eastern Indicator

Close: 1342

Change in % +2.29

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

Authentico Index Values

15 Micron

Close: 3187

Change in %:  +5.36

16 Micron

Close: 2723

Change in %: +3.61

17 Micron

Close: 2402

Change in %: +2.83

18 Micron

Close: 2051

Change in %: +1.23

19 Micron

Close: 1778

Change in %: +3.79

Authentico Indicator

Close: 2377

Change in %: +2.99

Forecast

The market outlook for wool continues to look positive as we again sold more wool at auction than we would traditionally around this time of the season and the market is still reacting strongly. How much of the current exported volume is destined for stock is unknown. It is possible that processors and manufacturers are building inventory on the expectation of better global conditions in the northern hemisphere next winter. Due to production timing, the raw materials need to be on the move now in order to be ready at retail later in the year. If you don’t have the stock and conditions do improve, as many do hope and suggest, then the risk is to lose another season. Any improvement in consumer sentiment must also be good for the wool market long term and this will be influencing the decisions of those who are more optimistic.

The Wool Production forecast committee has been meeting and we expect an announcement shortly regarding the latest forecast for the current season. Expectations are for a modest gain of around 2% on last year with improved season conditions the main catalyst.

Auction offering – current week

Market          Sale         Offered        Sold       Passed In

North                      S 44                  12017                   11256                6.3%

South                     M 44                 25073                  23448                6.5%

West                       F 44                  10356                    9692                 6.4%

Auction offering – next week

Market          Sale          Sale days          Volume

North                      S 45                     T-W                             14082

South                     M 45                     T-W                             24910

West                       F 45                      T-W                              9253

 

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