IT was another week of uncertainty in the wool forward and spot price markets.

We head into the last round of sales before the three-week recess with buyers and sellers reticent to commit.

Buyers are unable to find any clear signals from the downstream processors. Outright sellers are not prepared to short the market at the risk discount buyers are asking at the historically high spot prices.

Highlights of the week were August trading at 1500 cents and above and the hedge setting of the 21 micron index out to September 2018.

Only a small percentage of growers seem to place sufficient value on the certainty of price protection into the future, even though they would be hedging and locking in significant margins.

The current monthly hedge open position both outright and options as a percent of the monthly offering:

August 2017      281 tonnes        1.9pc

September        285 tonnes         1.2pc

October             138 tonnes          0.8pc

November           77 tonnes          0.3pc

December           29 tonnes           0.2pc

January     18 micron  40 tonnes  0.2pc

There appears at present to be little weight given to the value of certainty over the fear of lost opportunity.

We expect next week’s auction to continue the same pattern, with a slight easing of prices into the recess.

Anticipated forward levels next week

August              19 micron       1750 to 1800 cents

21 micron       1485 to 1500 cents

September       19 micron       1715 to 1750 cents

21 micron       1410 to 1430 cents

October            19 micron       1690 to 1715 cents

21 micron       1400 to 1410 cents

Trade summary

August                        21 micron       1500/1505 cents        12.5 tonnes

October                      19 micron       1715 cents                     5 tonnes

September 2018       21 micron      1350 cents                   14 tonnes

Total 31.5 tonnes

Source: Southern Aurora Wool.