ANTICIPATION of a strong spot auction on the back of a weak Australian dollar saw the forwards trade strongly to start the week.
Autumn and next spring traded well in modest volumes. Highs where set on 18 micron in May (2245 cents), 19 micron in March (2150 cents), 20 micron in March (1970 cents) and 21 micron in April at 1780 cents.
The spring levels, albeit at discounts to the front months, returned historical highs in such a volatile market – 18 micron (2120), 19 micron (1920) and 21 micron (1620). Volumes fell off as the week progressed with buyers unable to justify the gains through off shore orders and growers looking to maximise the surge in the spot price.
As highlighted last week, the current spot market, and to a lesser extent the forwards, are being affected by cash flow issues, supply and the erratic $A. The volatile nature of the stock market and concerns of rising interest rates has seen traders looking to defray risk.
The ebbs and flows of the global financial sector will continue to impact the wool market. We anticipate unstable conditions to continue with swings based on supply and cash constraints. With Chinese New Year next week we may see a short term demand reduction.
Anticipated trading levels
Micron 19 micron 21 micron
Feb 2130 cents 1820 cents
March 2110 cents 1800 cents
April 2100 cents 1770 cents
May 2090 cents 1750 cents
June 2030 cents 1700 cents
March 19 micron 2150 cents 5 tonnes
March 19.5 micron 2050 cents 5 tonnes
March 20 micron 1970 cents 3.5 tonnes
April 19 micron 2115 cents 5 tonnes
April 21 micron 1750/1780 cents 17 tonnes
May 18 micron 2245 cents 2.5 tonnes
May 19 micron 2090/2105 cents 10.5 tonnes
May 21 micron 1750 cents 2.5 tonnes
September 17 micron 2500 cents 2 tonnes
September 21 micron 1620 cents 7 tonnes
October 18 micron 2100/2120 cents 7.5 tonnes
October 19 micron 1920 cents 3 tonnes
October 21 micron 1610 cents 2 tonnes
November 19 micron 1900 cents 2 tonnes
Total 77.5 tonnes
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