“Risk Management lets you appreciate the risk while you let someone else shoulder all the worry.” ― Anthony T. Hincks
AUSTRALIA’S wool auction market started cautiously on Tuesday with little change.
Fine wools were in better demand, but the medium microns struggled.
On Wednesday and Thursday, the momentum lifted, with the superfine and fine wools leading the way and putting on 2-3 percent for the week.
The 18.5 micron and finer wools rose more modestly by 0.5-1pc.
The forward market continues to struggle with a lack of activity from the selling side. Growers’ patience has been understandable. Prices have declined all season particularly in the superfine and fine end. The fall has been relatively constant punctuated by weak rallies.
In the last month there has been a trend reversal, with the stronger tendency only pausing momentarily. While the finer wools still lag behind, 21 micron breaking through its two-year average should have growers beginning to look at a starting point for their longer-term hedge strategies.
Buyers have their levels at flat to cash for the first quarter of 2024. The premium for 2025 on 19 micron is sitting at 1pc over spot.
Hopefully, we will see a continuation of demand into the last week of sales next week. This could provide some opportunities for growers to offset some New Year price risk.
This week’s trades
December 19 micron 1445 cents 5 tonnes
January 19 micron 1455 cents 5 tonnes
Source – Southern Aurora Markets.