Mecardo Analysis - Wool market solid despite fire delay to sale
- By: "Farm Tender" News
- Ag Tech News
- Sep 03, 2018
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By Robert Herrmann | Source: AWEX, Mecardo.
The wool market in recent times has been described as “on fire” with record price levels regularly breached. This past week it literally was a fire that impacted the market, with the Thursday Melbourne sale delayed until Friday due to a factory fire in nearby Footscray.
The Eastern Market Indicator (EMI) rose from the beginning of the week, recovering some of last week’s losses to post a 22 cents gain for the week, to settle at 2090 cents AU$ (Figure 1).
With the US$ losing almost 1 cent over the week, the EMI in US$ terms closed at 1,516 US cents, down 3 cents on the week.
Sydney offered a designated Superfine sale and the quality of the wool rostered belied the drought conditions across much of NSW. AWEX reported that the quality, staple strength and crimp definition was of a high level, and as a result Italian spinners were the major force in the market. They were also aided by a cheaper Euro currency that has fallen almost 5% over the past 3 weeks.
Fremantle sale posted losses, mainly in the 20/21 MPG area, however this was compared to a fortnight ago as Fremantle didn’t sell last week.
Wool producers again were keen to sell, passing in only 2.7% of the offered bales resulting in a clearance to the trade of 35,001 bales passing in less than 1,000 bales. This resulted in dollar value for the week of $87.3 million, with a combined value of $502.1 million so far this season.
Previously we have reported that better style wool has been more keenly sought and lower styles sometimes overlooked, this week small faults were ignored as buyers sought to secure quantity.
On a very small catalogue offering, Crossbred types increased across the board about 10 cents.
Merino Cardings also improved on a limited offering with all centres closing higher with Melbourne & Fremantle close to the previously unheard of 1600 cent level.
What does this mean?
A look ahead shows that roster offerings are steady as winter shorn wool flows through the system.
Next week the roster increases to 39,230 bales with all centres selling, followed by 34 & 38,000 in subsequent weeks.
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