FORWARD bidding on wool remained consistent last week with a light volume traded at or around cash levels.
The wool auction market last week continued to be dominated by uncertainty and reactive to changes in sentiment.
The indent order flow into the spot market continues to be erratic and consistent forward sales are not forthcoming. The result was a weaker spot market that continues to look for direction.
Growers still seem to be reluctant to commit at these levels even with the curve flat out to March 2020. This is understandable with drought and fires to the front of everyone’s mind at present
Exporters were bidding 21 micron at last week’s close (1740 cents) early in the week, but fatigued by mid-week under the pressure of lack of demand pull and poor sentiment. A weaker than expected spot market saw some trade selling joining the light grower interest and February and March were executed at 1720 cents for 21 microns. This level still equates to more than $2000 per bale.
This week is likely to see exporters still prepared to take on some stocks at around the 1750-cent level for 19 micron and 1700 cents for 21 micron. Any move outside these band will likely come from outside influences.
Indicative trading levels for next week
19 micron 21 micron
November 1750 cents 1720 cents
December 1750 cents 1720 cents
January/March 1750 cents 1720 cents
April/June 1720 cents 1680 cents
February 21 micron 1720/1745 cents 25 tonnes
March 21 micron 1720 cents 5 tonnes
Total 30 tonnes