Weekly Market Wrap
With Adrian Field, Melbourne
Assistant Trading Manager
February 27, 2004
Trend continues
THE eastern indicator closed this week at 772 cents per
kilogram, a small gain equating to 5c/kg.
A sudden shortage of wool on offer, combined with a weakening
Australian dollar, were the main reasons behind the steady
market.
In the south, most finer wool types eased whilst broader types
strengthened, particularly crossbred wools.
Newcastle held its final superfine sale for the year and demand
was generally pretty good. A premium was paid for stylish
fine wools, which were fairly scarce compared to the last
sale.
This week’s market moves were again proof that volume
of wool on offer will have a significant affect on prices
received.
As mentioned a couple of weeks ago, consistency in market
levels will require controlling the volume of wool on offer.
There is little control over demand, but supply can be controlled.
General
Recent articles from studies in South Australia have suggested
that the medium to broad wool, dual-purpose (meat/wool) sheep
have been the big winners over the past couple of years.
Studies have shown dual-purpose sheep are achieving returns
of $26 dry sheep equivalent, which has performed better than
fat lambs at $24 (DSE) and cattle at $11.
As well as good returns for meat, these type of sheep have
been achieving some of the best prices for their wool on record.
Unlike most other years, medium and broad wool has often equalled
fine wool prices.
With larger wool cut per head, lower maintenance and the
ability to mother large fat lambs, the stronger wool sheep
has finally been a worthwhile option. It was not that long
ago when the returns for broad wool sheep were very low.
The past fortnight has seen another two large local wool processors
announce their closure. Melbourne Wool Scouring and Port Phillip
Mills were both located in Melbourne.
Exporting greasy wool overseas is more cost-effective and
is becoming more common, and so unfortunately this trend is
continuing.
Market
Little change is expected with the market next week. The 20
to 27 wool micron categories are still achieving good prices.
Broader crossbred wool is at the levels we are used to seeing,
and fine/superfine types could do with a boost.
| PAST ISSUES |
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|
 February
20, 2004 |
September
26, 2003 |
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| February
13, 2004 |
September
19, 2003 |
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| February
6, 2004 |
September
12, 2003 |
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| January
30 , 2004 |
September
5, 2003 |
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| January
23, 2004 |
August
29, 2003 |
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| January
16, 2004 |
August
22, 2003 |
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| January
9, 2004 |
August
15, 2003 |
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| December
12 , 2003 |
August
8, 2003 |
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| December
05 , 2003 |
August
1 , 2003 |
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| November
28, 2003 |
July
4 , 2003 |
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| November
21, 2003 |
June
27, 2003 |
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| November
14, 2003 |
June
20, 2003 |
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| November
7, 2003 |
June
13, 2003 |
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| October
31, 2003 |
June
6, 2003 |
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| October
24, 2003 |
May
30, 2003 |
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| October
17, 2003 |
May
23, 2003 |
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| October
10, 2003 |
May
16, 2003 |
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| October
3, 2003 |
May
9, 2003 |
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May
2, 2003 |
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