Weekly Wool Prices

Week ending 27 Jan 2012 (week 30)

27 January 2012

The AWEX Regional Indicators finished 0.5% higher, on average, at sales in Sydney, Melbourne and Fremantle this week when the US exchange rate rose by a further 1.1%.

Sales were held on Tuesday and Wednesday to fit in with the Public Holiday for Australia Day on Thursday.

The market got away to a firm start on Tuesday, with the EMI up by 2¢ in Australian currency and by 13¢ in US. This followed reports of some keen buying activity on the previous Friday. The best gains were made from 22 to 24 microns in Melbourne. Wednesday’s sale continued on a firm overall note with further good gains for the medium / broader Merino wools.

Looking at comparisons with last year, the EMI at 1194¢ is 1¢ less than in the same week last year; and the season average of 1229¢ is 267¢ higher than the season average at the end of Week 30 last year.

The Cape Wools Indicator in South Africa was down by 0.2%.

RegionLast SaleDay-to-Day Changes (Week 30)Sale-to-Sale ChangeClosing IndicatorSale-to-Sale Changes
WeekIndicatorTuesdayWednesdayThursdayUS ¢Euro ¢
Eastern291190+2+2No Sale+4 (+0.3%)1194+18+2
Northern291224+1+2No Sale+3 (+0.2%)1227+18+2
Southern291165+3+3No Sale+6 (+0.5%)1171+20+4
Western291196No Sale+8No Sale+8 (+0.7%)1204+23+5

44,751 bales were on offer, compared with 58,409 bales last week. 10.3% were passed in, comprised of 7.6% in Sydney, 10.6% in Melbourne and 13.6% in Fremantle. Pass-in rates for Merino fleece and skirtings were 7.1% and 8.7%, respectively.

40,142 bales were cleared to the trade.

The year-to-date offering is 34,456 bales less (-3.1%) than at the end of the same week last year. Current estimates for the next three sales suggest that the year-on-year difference will be relatively unchanged in the short term.

The US exchange rate (Reserve Bank) continued its upward movement this week, starting with a sharp rise on Monday. Financial analysts attributed this to news from Europe that Greece appeared close to reaching a deal with its creditors over bond repayments. The Australian Financial Review reported this morning that exchange rate rose above 106¢ on Thursday night, based on expectations of continuing low interest rates in the United States. It closed at 106.15 on Friday evening.

It fell to below 99¢ in the week of the last sale prior to the Christmas break.

Exchange Rates
(Reserve Bank)
Last SaleDay-to-Day ChangesSale-to-Sale
Closing ValueSeason Min & Max
United States103.95+0.95+0.04+0.19Public+1.18 (+1.1%)105.1395.00110.55
Euro80.84+0.50-0.60+0.01Holiday-0.09 (-0.1%)80.7571.5081.54

There were gains across all Merino micron ranges and types this week, with the greatest gains occurring from 22 to 24 microns. The average AWEX 16.5 micron MPG lifted sharply due to a 45¢ lift in Sydney on Wednesday.

The continued appreciation of the US exchange rate means that the EMI is up by 78¢ since the sale prior to Christmas, whereas the increase in Australian currency is a modest 5¢ over the same period.

Sale-to-Sale Changes in Average AWEX Merino Micron Price Guides (MPGs)
Since Last Sale:
Change ¢+39+4+2+3+5+2+2+3+6+15+44+27
Change %+2.1%+0.2%+0.1%+0.2%+0.3%+0.1%+0.1%+0.2%+0.5%+1.2%+3.6%+2.4%
Since Start of the Season:
Change ¢-764-670-586-458-327-234-169-141-125-98-9+42
Change %-28.9-28.5%-26.9%-23.2%-18.3%-14.1%-10.8%-9.5%-8.7%-7.1%-0.7%+3.8%
Since Same Week Last Year:
Change ¢-409-503-465-422-309-111+70+189+196+217+246+190
Change %-17.9%-23.0%-22.6%-21.8%-17.5%-7.2%+5.3%+16.4%+17.7%+20.3%+24.3%+20.0%

It was a another good week for skirtings type, with a good lift in prices on Tuesday, and most types either firm or up a bit further on Wednesday.

Crossbreds were in relatively large supply this week, leading to a slight easing in prices on both days. The one exception was at the fine end in the South on Wednesday when the local 26 micron MPG was up by 19¢.

Crutchings were in good demand among the oddments, while other types had a more mixed week. The average AWEX Merino Cardings Indicator was down by 4¢ (-0.6%).

Sale-to-Sale Changes in Other Average AWEX Price Guides
Since Last Sale:
Change ¢ +14-2-1+1-4
Change % +1.9%-0.3%-0.2%+0.2%-0.6%
Since Start of the Season:
Change ¢-7-98-84-90-85-105
Change %-0.8%-11.3%-12.4%-14.6%-15.0%-13.0%
Since Same Week Last Year:
Change ¢+72+11+19+19+28+16
Change %+8.8%+1.4%+3.3%+3.7%+6.2%+2.3%
# Average Merino Cardings Price Guide

Buyers for China were dominant followed by buyers for Europe and India.

Sales will be held in Sydney, Melbourne and Fremantle next week, when 39,239 bales are currently rostered for sale. Present estimates for the following two sales (Weeks 32 and 33) are 46,240 and 46,300 bales, respectively; a decrease of 2.0% over the three sale period when compared with last year.

In South African sales, the Cape Wools Indicator was down by 0.2% since last week against a 0.9% appreciation of the Rand against the US Dollar and a 0.7% depreciation against the Euro. 10,186 bales were on offer.


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© AWIS 2012 (for permission to reprint, in part or whole, please contact AWIS)