Market report 4/09/2013. The AWEX EMI added a whopping 62c and is now resting on 1,128c. This is a fortnightly accumulative gain of 116c the largest two-week gain since 2011. These sharp price rises produce another record low pass in rate of 1.7% (the lowest since 1995). The rise of the various MPG’s was interesting as exporters finished off their prompt shipping commitments and moved straight onto taking stock in for upcoming orders. It seems the market fundamentals may be changing from low volume and low demand to low volume and a mild increase in demand with Chinese interests now looking to re stock. Josh Lamb from Techwool Trading, one of the week’s top purchasers, commented that he believed that the current price levels would now move sideways or possibly down a little at worst. He continued that there was good enquiry over night from China and the market should sustain prices around this level give or take 40c. He mentioned that his clients had run down stocks over the past 18 months, leaving the pipeline relative empty. When asked why the slow start for prices in the August sales, Josh commented that no one wanted to jump in with a price first and therefore the pricing stayed fairly subdued until the past few weeks. Next week’s offering moves up to 44,212 bales and the following two sale weeks will remain around the 42,000 to 45,000 bale mark. The key to the marketing questions lies in the percentile bands. 17 and 18 micron has moved from the 45th percentile band to around the 70th percentile band since the market opened, this Superfine category has some ground to make up to reach the heights of 2011 but marketing these lots at the current prices is becoming more palatable by the day. The 19MPG at the 83rd percentile band is a definite sell whilst the 20-22 MPG’s at over the 90th percentile are a “no brainer” for those mixed farming operations looking to cover their pre-harvest expenses. Crossbreds and Cardings also fit into this bill. Is holding wool an option? In my view the higher the MPG percentile band the higher the risk. The market was conducted on Tuesday/Wednesday this week to accommodate "Wool Week" events on Thursday/Friday. Moses and Son chose to attend the SWS Merino Breeders Field Day at Galong this year over wool week, and I was very impressed at the way the field day went with 50 studs attending and the extremely positive feel I experienced around the site. My congratulations go to the committee for a great day out. ~ Marty Moses
Posted on: Fri, 06 Sep 2013 07:03:40 +0000
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