Wk 45 5/05/2016. The AWEX EMI gained 27c closing at 1268c at auction sales in Australia this week. The increase was largely contributed to the fall in the $A as a result of the drop in the official cash interest rate (1.75%) and coupled with the decreasing bales numbers on offer it was enough to fire up the competition for the week.

The feature of the market has been the stability of the EMI in USD terms for the past five weeks, whilst the EMI in AUD has fluctuated over 2.4 times more. The EMI has gained 51c (+4%) over the past three weeks on the back of the currency conversion, however the increase in the Fleece and Skirtings containing medium to heavy vegetable matter has increased the pressure on the FNF wools making up the indices.

This week saw an increase in all wool types with the Merino Fleece in Sydney and Fremantle outperforming the Melbourne market across the entire range. The star performers in the Merino Fleece categories were the 19.5-22µ categories with the Superfine and Ultrafine selection very well supported.

Prem shorn types as mentioned in the past weeks were also in keen demand and at times attracted extreme bidding. Skirtings posted a 40c increase with the Low VM lots getting the majority of the attention. Whilst the Crossbred types posted rises of 10-20c the competition was less excited in this area, and finally carding wools found some form with a 25c rise in Sydney.

Next week offering of 35,742 bales will be followed by estimates of similar quantities for another week before falling dramatically as we approach June.

Forward sales followed the market up with July 21 contracts trading at 1,375c and bids out into September of 1320c or a 5.5c discount to the market.

The AWTA released their end of month and YOY comparisons, April bales cored were down -2.3% whilst the YOY figures are indicating a 5.5% reduction or 16.4mkg down on last year. ~ Marty Moses

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