Wool Market Update 15th September
” Those who have understanding, do not forecast. Those who forecast, do not have understanding.”– Lao Tzu, 6 th century BC Chinese Poet
The area auction continued its healing today with the EMI recovering half of the early season losses. Having actually lost 61 cents throughout August and early September the marketplace has actually enhanced 30 cents over the last 3 auction days.
The forward market still sustains slow volumes even as it equals the money. This is likely due to the existing need keeping its focus in the timely window. The exception being interest from the buy side throughout the very first half of 2025 with levels raising to 1470 for 19.0 microns on the back of a firmer area auction. In the area market 19.0 microns closed the week at 1450 so the forwards present a small premium.
The medium-term window, October to December, is revealing little interest from the buy side. Sellers have actually set levels throughout the medium merino market (19/20/21) throughout Oct and November around 10 to 20 cents above money. An extension of existing rally might prig the interest of purchasers around these levels. Present deals for 19.0 in October are 1455 to 1470 which is around $1800 a bale. For 21.0 the series of deals are 1325 to 1350 or around $1350 per bale.
This rally likewise might assist the sell and change method discussed recently. Growers holding wool at present may think about offering, lowering holding expenses and enhancing capital, and changing their long position with a paper trade.
When it comes to next week it is challenging to be positive although a few of Wednesday’s weak point can be put down to choice and a somewhat more powerful Australian Dollar. Still the macro economics of our significant trading partners will drive the instructions. As recommended prior, it is great to be positive however constantly have a Strategy B. Hopefully spring will provide another rally to hedge off.