Market Updates
AWIS Wool market review - 18th April 2008
18 April 2008
The Australian wool market finished 1.4% lower, on average, at sales in Sydney, Melbourne and Fremantle this week.
The AWEX EMI fell by 19¢ (-2.0%), ending the week at 938¢/kg. This reflected decreases of 28¢ (-2.8%) in the North and 11¢ (-1.2%) in the South, with their corresponding Regional Indicators finishing the week at 981¢ and 903¢ clean, respectively. The Western Indicator fell by 2¢ (-0.2%), finishing the week at 936¢.
In a two day sale in Sydney and Melbourne, the AWEX EMI fell by 6¢ on Wednesday and by 13¢ on Thursday. The Western Indicator rose by 3¢ on Wednesday and fell by 5¢ on Thursday in a two day sale in Fremantle.
52,435 bales were on offer, compared with 53,550 bales last week, of which 20.7% were passed in, comprised of 16.7% in Sydney, 16.4% in Melbourne and 30.8% in Fremantle. The higher than usual pass-in rates were particularly noticeable on Thursday when 27.1% of the Northern offering and 37.7% of the Western offering were passed in. Pass-in rates for Merino fleece and skirtings were 22.0% and 20.2%, respectively. 2,121 bales (3.9%) were withdrawn prior to sale and re-offered bales made up 16.6% of this week's offering.
The US exchange rate (source RBA) was 0.83¢ lower on Monday when compared with Thursday of last week. It was up by 0.66¢ on Tuesday, down by 0.22¢ on Wednesday and up by 1.07¢ on Thursday to close at 93.79¢, up 0.68¢ (+0.7%) since the last sale. The exchange rate against the Euro rose by 0.14 Euro cents (+0.2%) to close at 58.87 Euro cents on Thursday night. When looked at in other currencies, the AWEX EMI decreased by 11¢ ( 1.2%) in US terms and by 10¢ (-1.8%) in Euro terms when compared with the previous sale.
It was a generally easier market this week that was also influenced by the appreciation in the US exchange rate. However, the 19¢ fall in the EMI was exaggerated by the drop of 28¢ reported for the Northern EMI, compared with the 11¢ fall in the Southern Indicator. This appears to partly due be a correction in the Northern Indicator from last week when it looked surprisingly high and partly due to a change in the quality of the offering. Last week's offering in the North saw very good prices paid for some lots.
Average AWEX Micron Price Guides (MPGs) were down by 10¢ for 17.5 microns, by 16¢ for 18.0 microns, by 7¢ for 18.5 microns, by 19¢ for 19.0 microns and by 15¢ for 19.5 microns. The 20.0 micron wool average MPG was down by 25¢ clean, 21.0 microns by 12¢, 22.0 microns by 4¢, 23.0 microns by 4¢, and 24.0 microns by 10¢.
Merino skirtings followed much of the fleece pattern with the better styled wools least affected. Oddments continued to ease, with the Merino Cardings Indicator down by a further 32¢. Crossbred wool average MPGs were down by 1 to 2¢.
Buyers for China were dominant with a strong presence of buying for Europe.
Sales will be held in Sydney, Melbourne and Fremantle next week when 51,625 bales are currently rostered for. Present estimates for the following three sales vary from 46,700 to 50,650 bales, an increase of 9.7% over the four sale period when compared with last year.
In South African sales, the Cape Wools Indicator was down by 0.4% since last sale two weeks ago against a 1.4% depreciation of the Rand against the US Dollar and a 3.2% depreciation against the Euro.
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