Weekly Market Wrap

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With Adrian Field, Melbourne
Trading Manager

May 28, 2004

Market reacts to dollar

THE eastern market indicator fell 8 cents per kilogram this week, which correlates directly to the rise in the Australian dollar in percentage terms. The dollar increased by 1 per cent and the market decreased by 1pc.

The indicator now sits at 790c/kg.

Most types were affected, especially Merino fleece types and most carding wools. Crutchings were very irregular.

A total 57,283 bales were offered and 48,562 were sold. This equated to a passed-in rate of 15pc Australia-wide, with Western Australia again recording the highest passed-in rate of more than 20pc.

Prices for micron categories between each selling centre are closer than they have been for quite some time.

We would expect the market to follow the Australian dollar and so could ease further next week.

However, big falls are not anticipated because some companies are aware that volumes are starting to decrease, with 2-day sales scheduled for the next couple of months.

Better style wools will continue to receive good support as they are limited.

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