Cheer­ful sea­son in wool mar­kets

Tasmanian Country - - THE STOCK REPORT -

THERE were 52000 bales ros­tered for sale this week, very close to the largest of­fer­ing of the sea­son to date.

Mel­bourne made up about half of the vol­ume, sell­ing over three days while Syd­ney and Fre­man­tle main­tained the usual ros­ter.

Thurs­day last week saw a bit of dip in the mar­ket with the SMI down 14 cents, which took us a bit by sur­prise.

The drop was only very short lived though and af­ter ini­tially open­ing softer this week, the mar­ket closed on Tues­day at its high­est point for the day and con­tin­ued to firm on Wed­nes­day. Fur­ther to this buy­ers again re­in­forced that “good spec” wools have main­tained their strength through­out thanks to the rel­a­tively short sup­ply of these types.

As we touched on last week, cur­rent prices and vol­umes are forc­ing some ex­porters to man­age their fi­nance fa­cil­i­ties very closely.

This is no cause for con­cern for sellers, rather just a point of in­ter­est that it is tak­ing a lot more cash to fi­nance the trade due to the in­creased prices.

Ram sales are now in full swing and we are see­ing strong and wide­spread buy­ing de­mand with plenty of pos­i­tiv­ity about wool prices.

A com­mon talk­ing point has been where are prices go­ing to go in the new year. We all know by now it’s im- pos­si­ble to fore­cast the fu­ture, so we can only make decisions with what in­for­ma­tion we have at hand.

The pos­i­tives are that we have cleared more wool sea­son to date this year than in any of the pre­vi­ous 10 sell­ing sea­sons, tight­en­ing sup­ply pres­sure. De­mand for bet­ter-spec Tas­ma­nian wool will con­tinue to be strong as the in­ter­state se­lec­tion de­te­ri­o­rates.

We have main­tained this price point for an ex­tended pe­riod now, point­ing to some price ac­cep­tance from earlystage pro­ces­sors.

On the flip side, as we touched on last week, later stages of the pro­duc­tion line have not felt in full this new price point yet. We are sit­ting at near all time highs and the un­knowns of global macro­eco­nomics and ex­change rates are also a fac­tor.

My per­sonal view is the pos­i­tives out­weigh the neg­a­tives, point­ing to sus­tain­abil­ity, but it would take a braver man than me to fore­cast sig­nif­i­cant in­creases from the cur­rent level.

We are now into De­cem­ber with only two sell­ing weeks re­main­ing be­fore the three-week re­cess. With a sig­nif­i­cant Tas­ma­nian se­lec­tion on Tues­day, we are aware of sev­eral Tas­ma­nian-spe­cific or­ders in the mar­ket, which is great.

As this nis my last col­umn for the year I wish ev­ery­one well in wool and ram sales dur­ing De­cem­ber and a safe hol­i­day pe­riod. Don’t for­get to buy a woolen item for a loved one’s Christmas stocking.

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