Southern Aurora Markets partner Mike Avery.
“History repeats itself, but in such cunning disguise that we never detect the resemblance until the damage is done” – Sydney J. Harris
AUSTRALIA’S spot auction and forward wool markets were on repeat this week.
The physical auction opened Tuesday with significant falls in the superfine wools, weakness in the fine wools and medium Merinos holding their own.
Crossbreds remained firm near the top of their narrow trading range that has held since November.
Valentine’s Day Wednesday delivered a little love to the auction market with the 17.5, 19, 20 and 30 micron price guides all posting gains. The Eastern Market Indicator (EMI) rose 1 cent, the first positive result in 12 trading sessions.
There was not a lot to get excited about, but with the key Asian markets are still celebrating Lunar New Year and demand was limited. Not surprisingly, the positive market continued Thursday with Melbourne the only centre selling. The EMI rose 1 cent again.
The forwards once again traded in light volumes. There was 15 tons traded on Monday in March and April for 21 micron at 1320 cents that represented cash. That was that for the week. Sellers failed to follow through with any further volume, so buyers retreated, waiting for direction from the auction room. With that direction negative again, it was a little surprising to see traders setting levels at par to cash, albeit in limited volumes and selected micron.
Bids are currently placed from March to June for 18.5 micron @ 1475 cents, 19 micron @ 1410 cents, 19.5 micron @ 1355 cents and 20 micron @ 1330 cents. Crossbreds are bid for 28 micron at 360 cents and 30 micron at 340 cents.
Hopefully, we will continue to find a base here, but the headwinds of poor demand signals, the challenging global economic conditions and unrest continue to impact supply chains and confidence.
This week trades
March 21 micron 1320 cents 5 tonnes
April 21 micron 1310 cents 10 tonnes
Total 15 tonnes
Source – Southern Aurora Markets.
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