Southern Aurora Markets partner Mike Avery.

When everything seems to be going against you, remember that the airplane takes off against the wind, not with it. — Henry Ford.

NOT even the tight supply situation could hold up the wool spot market that once again drifted on the exchange rate.

A move in the AUD of one percent stronger against the USD related almost precisely to fall in prices in the sale room.

History indicates that this relationship only holds when the market has no direction. This is certainly where we find ourselves now.

General uncertainty prevails across most commodities at present with forward business difficult to eke out. The spot wool auction remains dominated by just-in-time buying.

The forward market continues to struggle although bidding at a slight discount to spot levels has begun to reappear in the nearby months and spring. Buyers appear to be looking for some hedge cover around key levels (19 micron at 1500 cents and 21 micron at 1400 cents). Volumes remain limited.

It is difficult to see and major shift in direction of the market while ambiguity remains around trade and tariffs. Tight supply might moderate the decline but a change in consumer confidence is needed to boost demand.

Traded this week

19 micron July                                                    1495 cents  (cash 1497)

21 micron August                                             1420 cents (cash 1417)

21 micron September                                    1420 cents