Weekly Market Wrap

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With Adrian Field, Melbourne
Trading Manager

January 19, 2007

Market has a reality check

NEWS of the market is quite different this week, with prices falling 3-7 per cent. The eastern market indicator settled at 926 cents per kilogram at the end of the week, dipping 36c/kg.

This was not a great surprise to many considering the skyrocketing prices of recent weeks.

Most price falls were recorded in Merino fleece types, particularly 24-micron and finer wools.

Carding wools went against the trend, jumping by up to 25c/kg.

Southern region

Merino fleece in the 19-25 micron range shed about 65c/kg, with remaining microns falling by about 35c/kg.

Merino skirtings were slightly weaker overall and most crossbred wools decreased by about 10c/kg, with 30-micron types dropping 20c/kg.

The strong Australian dollar and large offering scheduled for next week probably didn't help the market this week.

Sales will be held in all three centres next week, with more than 87,000 bales rostered.

The market may struggle a little under the weight of the larger offering, but it should still be solid. Many Chinese customers are prepared to buy at these new levels - and the Australian dollar has since also weakened slightly.

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