Auction price rises energise forward wool market

Michael Avery, Southern Aurora Markets partner, June 10, 2022

Southern Aurora Markets partner Mike Avery.

A STRONG spot market has energised forward wool trading, with improved volumes trading on maturities ranging from July through to June 2023.

The auction market had to two very solid days, with all Merino types gaining 30 to 40 cents for the week and passed-in rates falling to under 10 percent.

Buyers reacted by meeting sellers’ levels on the forward markets across all micron groups.

The majority of trades were in the finer microns (1719 micron) with growers content to lock in at levels on or above the 80th percentile for the last twelve years.

We anticipate buying interest to remain next week. Buyers remain cautious, but still interested to cover early season sales where possible. Spring pricing broke through the recent resistance levels of 1700 cents for 19 micron and 1300 cents for 21 micron. Growers have lifted target levels.

Buyers’ ability to follow will be a function of offshore demand outside the current narrow window. Rising input and logistic costs may provide continuing headwinds to balance the tight supply that has driven the current spot rally.

This week’s trades

July 19.5 micron                                   1565 cents                                2 tonnes

August 17 micron                                2625 cents                              10 tonnes

August 18 micron                                2205 cents                                5 tonnes

August 19 micron                                1710/20 cents                        10 tonnes

September 18 micron                          2175 cents                              12 tonnes

September 19 micron                           1705 cents                                5 tonnes

September 21 micron                          1320 cents                              10 tonnes

October 21 micron                              1320 cents                              10 tonnes

November 18 micron                          2105 cents                                5 tonnes

November 19 micron                          1700/10 cents                        12.5 tonnes

December 18 micron                           2090 cents                                5 tonnes

January ‘23 17 micron                         2555 cents                                5 tonnes

January ‘23 19 micron                         1705 cents                                5 tonnes

June ‘23 17 micron                              2500 cents                                8 tonnes

Total 104.5 tonnes


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