WOOL’S forward trading market has recorded its highest weekly volume for the year, with growers opting for some certainty in these uncertain times.
Buyers were predominantly large offshore processors and a 96 tonnes were executed.
There was some light shining on the spot market with most qualities showing modest gains in the spot auction this week.
The majority of forward trades went through in the spring. The 19 micron contract traded off its earlier highs above 1600 cents, to finish the week trading at 1500 cents in September through to December as sellers outnumbered the buyers. This is around a 10 percent discount to cash, but still in the 65th percentile of prices for the last decade.
The nearby window traded lightly under the shadow of the ever-changing COVID-19 restrictions. April and May traded around cash with 19 micron trading at 1640-1650 cents and 21 micron to a high of 1635 cents.
Auctions appear to continuing on schedule, at least in the short term, due to the diligent proactive and cooperative work across the supply chain.
There appears to be real interest from processors to get some cover in the new season at reasonable levels. Given the uncertainty it would be prudent for growers to initiate some hedging for spring – even if it is considered disaster insurance.
Anticipated trading levels
19 micron 21 micron
April/May/June 1600 cents 1570 cents
July/Aug/September 1560 cents 1500 cents
Oct/Nov/Dec 1500 cents 1450 cents
Jan/Feb/March 1480 cents 1420 cents
April 19 micron 1640 cents 5 tonnes
April 21 micron 1635 cents 2.5 tonnes
May 19 micron 1650 cents 5 tonnes
September 19 micron 1500/1640 cents 45.5 tonnes
October 19 micron 1550/1551 cents 20 tonnes
November 19 micron 1550/1570 cents 13 tonnes
December 19 micron 1500 cents 5 tonnes
Total 96 tonnes