Wool Market Reports

Modest forward wool trading with uninspiring auction results

Michael Avery, Southern Aurora Markets partner, May 24, 2024

Southern Aurora Markets partner Mike Avery.


We’re always in the middle of two energies. Gravity is sinking you down; inspiration is pulling you up. – Mandy Inger


FORWARD wool trading was modest this week as the spot auctions again failed to deliver much if any inspiration.

Superfine and fine wools tended to hold their ground, while the medium qualities succumbed to the tepid demand and unhelpful Australian dollar.

The forward market had modest action. Buyers have been endeavouring to cover some risk as prices looked to bounce off midpoint of their more recent trading range.

Some trading occurred with the 18.5 micron contract executed for June at 1455 cents and 21 micron in July at 1300 cents. Bid levels have generally held firm to cash mirroring price action in the spot, 17-19 micron and crossbreds were unchanged for the week and the 19.5, 20 and 21 microns reduced 20 cents. Sellers have generally been cautious, undervaluing certainty.

Selling levels are beginning to appear in the spring and early summer. They are currently set at 60 to 70 cents above cash. It will be interesting to see how the buy side react. Presently buyers see that level of premium to the spot market only justifiable twelve months out. This is reflected in the current bidding of 19 micron for the second half of 2025 at 1470 cents and lifting to 1500 cents in early 2026.

Trading volumes are thin, but emphasise to one of the important roles of forward markets – giving particularly growers an indicative forecast of return. The robustness and value of these signals can only come about with better participation by buyers and sellers.

Spot volumes remain tight with just 33,000 bales on offer next week. The placid demand persists with consumer confidence still low, economic recovery disappointingly slow and resolution to global conflicts still in the future.

Hopefully, we will see inspiration in the form of better bidding into the spring and New Year to match the confidence of 2025/26.

This week’s trades

18.5 micron June                                                              1455 cents                           5 tonnes

21 July                                                                                   1300 cents                           5 tonnes

Total 10 tonnes

Source – Southern Aurora Markets.


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