AWEX drops, fine wool MPGs up

13 Dec '10

3 min read

The AWEX Regional Indicators finished 0.9% lower, on average, at sales in Sydney, Melbourne and Fremantle this week when the US exchange rate rose by 2.4%.

53,131 bales were on offer, compared with 57,625 bales last week. 13.3% were passed in, comprised of 8.8% in Sydney, 13.8% in Melbourne and 18.5% in Fremantle. Pass-in rates for Merino fleece and skirtings were 16.2% and 9.1%, respectively.

2,029 bales (3.7%) from were withdrawn prior to sale and re-offered bales made up 9.8% of the final offering.

The New Zealand Merino Company also offered 1,707 bales in Melbourne on Wednesday of which 34.4% were passed in.

The US exchange rate rose on Friday of last week and on Monday this week after the release of weak non-farm employment data from the United States. It remained steady when Australian interest rates were left unchanged on Tuesday and rose again on Thursday following the announcement of good Australian employment data for November.

The week started on a strong note in Melbourne on Tuesday following last Thursday's big gains. Fine wool MPGs were up by 10 to 20¢. But, medium and broader AWEX MPGs eased by 3 to 9¢. The rise in the US exchange rate led to the AWEX EMI being up by 28¢ in US currency. Wednesday's sales saw little change and Thursday's sale finished on a softer note across all micron ranges, but with the EMI up by 2¢ in US, as the exchange rate rose again.

The closing cotton price at the New York Board of trade fell by 3.8% this week.

Prices for better skirting types lifted on Tuesday and were generally higher again on Wednesday, apart from the West where prices eased. There was a recovery in the West on Thursday and further rises in the East. Fine crossbred average AWEX MPGs fell sharply on Tuesday, otherwise other micron groups finished the week little different to their closing MPGs last week. Oddments were somewhat mixed during the week. The average AWEX Merino Cardings Price Guide was up by 2¢ for the week.

Buyers for China were again dominant followed by buyers for Europe and India. Trade reports indicate good demand in Europe.

The last sales prior to the Christmas break will be held in Sydney, Melbourne and Fremantle next week, when 50,663 bales are currently rostered for sale, a 9.3% increase when compared with the same sale last year.

The Cape Wools Indicator partially recovered from last week's 6.3% fall to be up by 3.7% this week in the last South African sale until 12 January. This rise was against a 1.7% appreciation of the Rand against the US Dollar and a 0.4% appreciation against the Euro. 11,383 bales were on offer.

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Australian Wool Industries Secretariat

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