IT WAS a hesitant week for the auction and forward wool markets this week.
The lack of direction was evident in the forwards all week. Buyers were reluctant to take on risk and the modest trades were restricted to the prompt month.
Interest post-Easter and into the new season waned as off shore buyers showed little confirmation of acceptance of these levels.
Supply concerns suggest that the market has limited downside, but history shows that the key driver is demand. The level of demand destruction due to increasing prices is difficult to ascertain. Even a correction of 10 percent would still see the market maintain the upward channel that Merino qualities have enjoyed for the last four years.
With similar quantities on the market next week the market direction will again be influenced by the expectation and assessment of new demand and the extent of financial pressure exerted on exporters to fund working inventory at these price levels.
Anticipated trading levels
Month 19 micron 21 micron
March 2090 cents 1870 cents
April 2080 cents 1850 cents
May 2060 cents 1810 cents
June 2040 cents 1780 cents
July 2020 cents 1760 cents
March 18 micron 2330 cents 4 tonnes
March 20 micron 1970 cents 5 tonnes
March 21 micron 1900 cents 10 tonnes
Total 19 tons