Weekly Market Wrap
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With Brian Vagg, Melbourne
April 11, 2008
Market a mixed bag
THE wool market opened on Wednesday this week in all regions, with 53,550 bales offered nationally.
There was a large volume of poorer styled wools and a low level of better styled wool with high strength values and lower percentage of mid-breaks.
The US exchange rate was 1.51 cents higher on Wednesday compared with the close of the market last Thursday. On Thursday the Australian dollar was up 0.09c to close at 93.11c.
Nationally there were mixed results, with the northern market closing 20-30c/kg dearer for the 19-micron and finer fleece. The 21-23 micron fleece closed down 3-5c/kg in Sydney.
In Melbourne, the selection comprised a large percentage of low yielding, average topmaking types and there was a high percentage of lots that had low tensile strength and high mid breaks.
AWEX quoted the southern region 18.5-21 micron fleece at 20-30c/kg easier.
Buyers agreed that it was difficult to get a true picture because the difference between the better and inferior tops is becoming greater. The better types with good specification remained fairly firm in the south.
Merino skirtings followed a similar line as the fleece, with the better styled wools improving while most other types remained either steady or lost some ground.
Oddments continued to ease, with the Merino cardings indicator down by a further 11c/kg.
Crossbred wools were down at the fine end and in the medium range and were steady at the coarse end.
The national pass-in rate was relatively high at 16.8 per cent.
Buyers from all sectors were active in this week's market. Next week's sales will be held in Sydney, Melbourne and Fremantle, with 54,357 bales rostered for sale.
Recently released ABS statistics for February showed Australian exports in the eight months to February were down by 12.6pc in volume, but up by 1.4pc in value.
Exports to China were down by 15.1pc, but still made up 62.3pc of Australia's exports in the period since July 2007.
Australian Merino Woolmark Prize
Australian Wool Innovation (AWI) has taken a major step forward in their bid to support emerging international fashion talent by launching the 'The Australian Merino Woolmark Prize', drawing on ideas from a similar, successful wool program used 54 years ago.
The international prize has been conceived to assist emerging, leading talent to occupy a solid place in the global apparel industry.
In 1954, two young, unknown women's wear designers, Karl Lagerfeld and Yves Saint Laurent, stepped up onto a stage to accept their respective fashion design prizes, awarded by the International Wool Secretariat.
Lagerfeld, then 21, was winner of the coat category. Saint Laurent, at a mere 19 years old, won the award for dress design.
Open to young designers who have recently graduated and are already professionally active, the prize was conceived to help nurture those most in need: the fashion designer on the cusp of commercial credibility.
For the inaugural Woolmark Prize 2008, designers from cultures as diverse as China, Japan, Norway, England, Belgium, Germany and France - have been selected by an international panel of fashion experts to participate.
Each designer has formulated a capsule collection, emphasising the sensual, sculptural aspects of knitted yarn.
A panel of fashion experts will assess the entries and adjudicate the prize, to be presented at the Palais de Tokyo, Paris, on July 3, 2008.
The winner of the Woolmark Prize 2008 will receive significant in-kind support from AWI and Woolmark through industry support and mentoring.
The Woolmark Prize will be awarded annually and aims to be one of the most sought after prizes for up and coming global designers. Source: www.woolmark.com
Spin-off for Aussie wool in NZ-China deal
The historic signing of the China-New Zealand Free Trade Agreement (FTA) this week gives hope to an Australian wool industry still battling red tape in China.
The China-New Zealand agreement sets an important precedent, with Australian woolgrowers and exporters still having to work within a centralised import quota system for raw wool.
The fact that New Zealand has achieved this position and included wool and meat in the FTA suggests China believes these two products are key to their markets. The NZ FTA therefore holds Australia in a good position to do likewise. Source: Rural Press.
Australian dollar limiting wool return
Australian wool producers are the victims of a high Australian dollar, which is eating away their returns despite buyers paying top dollar.
Over the past 10 weeks, the wool market's slide from its recent peaks has been purely currency related, according to Australian Wool Innovation economist Paul Deane.
"International wool buyers are actually paying high prices for their wool - it is just that farmers are not seeing it, because of the high value of the Australian dollar," Mr Deane said.
However, the outlook for wool was still positive with the apparel side booming over the past 12 months, driven by short supply and strong demand, he said.
"Strong economic conditions, favourable fashion trends and lack of stock at early stages of processing, are pushing the demand," Mr Deane said.
"On top of this, the wool supply is down, with sheep numbers unlikely to rebound sharply over the coming two seasons."
"The auction offering is down about 12-13pc, with production falling, and stocks are already well down both in-store and on-farm." Source: Rural Press
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