This week the market bounded out of the blocks to record one of the biggest one day rises in the past 10 years, however exporters found their customers pulling back prices on the final day as they took stock of the strong rally.
The big story is that by the end of the week significant rises for all MPG categories were noted across the board.
The Eastern Market Indicator (EMI) rallied strongly lifting 102 cents on top of last week’s 95¢ rise to close this week at 1219¢, another 9.1% lift for the week. This puts the EMI market rally since the beginning of September (at what appears to now be the low) at 37%, with the EMI gaining 361 cents over a 7-week period. The AUD was a tad lower at US$0.71 which saw the EMI in USD terms rising 62¢ for the week, closing at 863¢. Fremantle selling last saw some of the Tuesday gains given back, with a 60-cent retracement on Wednesday to leave the Western Market Indicator gaining 52¢ for the week and now sitting at 1219¢.
An increased offering to last week of 34,661 bales came forward. With a pass-in rate of 6.4% nationally, 32,483 bales were sold, 4,798 bales more than last week.
While there were widespread price rises, skirtings were at times extreme – with the Tuesday increases maintained to the end of the week. 18.0 micron & finer skirtings posted rises of 180 cents on Tuesday and were generally unchanged to the close except for Fremantle where the easing tone of late sales impacted skirtings also.
The crossbred section was animated with all types showing improvement. Fine crossbred was keenly sought rising across the selling week, the 29 MPG lifted 158 cents or 31% for the week.
Cardings were also quoted stronger at all selling centres, with an average across the board rally of 46 cents. Melbourne was strongest with a 62 cent or 8.2% increase in the Carding indicator on top of last week’s 7.6% rise.
This week on Mecardo, Andrew Woods noted that as Mecardo articles in the past have outlined, fibre prices are bound together through blending/substitution and fashion. There is a level of correlation between prices of different apparel fibres varies as they largely follow the same general cycles and trends.
Apparel fibre markets in China have picked up during the past month, with the greasy wool market following the general apparel fibre complex. Merino prices have outperformed the other fibres, but from a relatively lower base. Such a backdrop to the recent rises in merino prices suggests the market will hold most of the recent rises and additionally hints that the market has quite likely seen the worst of the COVID-19 downturn.
The week ahead….
AWEX noted that with Fremantle selling last, the market finished on a softer note. This will pose some questions for the level of new orders placed in the market for next week.
There are 44,004 bales listed for sale with all centres selling on both Tuesday & Wednesday; this is 10,000 more than last week and will test demand.
The Australian wool market stabilised this week, with the Eastern Market Indicator (EMI) down just 1 cent to 1,189 c/kg, despite currency swings impacting USD
The Australian wool market softened this week as a firmer Australian dollar and a sharp decline in wool quality weighed on buyer sentiment. The Eastern
The latest AWTA core test volume data shows a continued fall in Australian wool production, which is not surprising given the tough seasonal conditions across
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Strong open to the market … then caution
The Eastern Market Indicator (EMI) rallied strongly lifting 102 cents on top of last week’s 95¢ rise to close this week at 1219¢, another 9.1% lift for the week. This puts the EMI market rally since the beginning of September (at what appears to now be the low) at 37%, with the EMI gaining 361 cents over a 7-week period. The AUD was a tad lower at US$0.71 which saw the EMI in USD terms rising 62¢ for the week, closing at 863¢. Fremantle selling last saw some of the Tuesday gains given back, with a 60-cent retracement on Wednesday to leave the Western Market Indicator gaining 52¢ for the week and now sitting at 1219¢.
An increased offering to last week of 34,661 bales came forward. With a pass-in rate of 6.4% nationally, 32,483 bales were sold, 4,798 bales more than last week.
While there were widespread price rises, skirtings were at times extreme – with the Tuesday increases maintained to the end of the week. 18.0 micron & finer skirtings posted rises of 180 cents on Tuesday and were generally unchanged to the close except for Fremantle where the easing tone of late sales impacted skirtings also.
The crossbred section was animated with all types showing improvement. Fine crossbred was keenly sought rising across the selling week, the 29 MPG lifted 158 cents or 31% for the week.
Cardings were also quoted stronger at all selling centres, with an average across the board rally of 46 cents. Melbourne was strongest with a 62 cent or 8.2% increase in the Carding indicator on top of last week’s 7.6% rise.
This week on Mecardo, Andrew Woods noted that as Mecardo articles in the past have outlined, fibre prices are bound together through blending/substitution and fashion. There is a level of correlation between prices of different apparel fibres varies as they largely follow the same general cycles and trends.
Apparel fibre markets in China have picked up during the past month, with the greasy wool market following the general apparel fibre complex. Merino prices have outperformed the other fibres, but from a relatively lower base. Such a backdrop to the recent rises in merino prices suggests the market will hold most of the recent rises and additionally hints that the market has quite likely seen the worst of the COVID-19 downturn.
The week ahead….
AWEX noted that with Fremantle selling last, the market finished on a softer note. This will pose some questions for the level of new orders placed in the market for next week.
There are 44,004 bales listed for sale with all centres selling on both Tuesday & Wednesday; this is 10,000 more than last week and will test demand.
Have any questions or comments?
Click on graph to expand
Click on graph to expand
Click on graph to expand
Data sources: AWEX, Mecardo
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Have any questions or comments?
Volume light, demand tight, and a flat EMI
The Australian wool market stabilised this week, with the Eastern Market Indicator (EMI) down just 1 cent to 1,189 c/kg, despite currency swings impacting USD
Volumes ain’t volumes
Weekly auction volumes of wool offered are often bandied around as a measure of whether supply is set to outstrip or fall short of demand,
Wool dips as quality slips
The Australian wool market softened this week as a firmer Australian dollar and a sharp decline in wool quality weighed on buyer sentiment. The Eastern
What are wool prices doing in response to lower supply?
The latest AWTA core test volume data shows a continued fall in Australian wool production, which is not surprising given the tough seasonal conditions across
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Independent analysis and outlook for wool, livestock and grain markets delivered to you as it’s published
Listen to the podcast
Join the Mecardo team for the Commodity Conversations podcast, where we provide short weekly market recaps and longer conversations with guests to discuss the drivers and trends in livestock, grain and fibre markets.
MEET THE TEAM
Our team of market analysts are recognised as leaders in Australian Ag market analysis, providing invaluable insights to help you navigate the ever-changing commodity landscape.
SERVICES AND CAPABILITIES STATEMENT BROCHURE
We don’t just bring you the most up to date market insights. Find out more about Mecardo’s services including risk management advisory, modelling, benchmarking, research & consultancy.