Forward wool traders pre-empt spot auction uncertainty

Michael Avery, Southern Aurora Markets partner, March 17, 2023

Southern Aurora Markets partner Mike Avery.

FORWARD wool traders pre-empted the spot auction market this week as it was dominated by outside influences and uncertainty.

The auction market, that has battled against the tide of strong supply for the last month, capitulated to the global pressures this week.

Negative sentiment surrounding the banking sector and generally tensions has seen all commodities have an ordinary week with most in the agricultural sector suffering losses. Cotton and wool values have fallen back to pre-Christmas levels in both USD and AUD terms.

The forward wool market pre-empted the spot weakness, with sellers taking out the near-term bids that were marginally under cash. In the absence of any positive demand signals buyers withdrew most bid levels, including the long-term support levels in the 19 micron category at 1670 cents for next season and into 2025.

The test for the market will now come over the next three weeks and the run to the Easter recess.

This week’s trades

April 19 micron                                                1630/1680 cents                             10 tonnes

April 21 micron                                                1440 cents                                          7 tonnes

Total 17 tonnes

Source – Southern Aurora Markets.


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