A look at wool prices
HOPES were building last week the winter wool market slide had started to thaw.
In the past three months, the Eastern Market Indicator (EMI) has dropped 14.8 per cent from a starting price of 1096 cents a kilogram to finish last week at 934c/kg ? the biggest winter fall since 1990.
But last week the northern market was showing a glimmer that the big price falls may be over.
The EMI slipped just 1c/kg to finish last Tuesday at 933c/kg.
Many micron price guides in Sydney picked up a few cents while the star performers were the 30-microns gaining 22c/kg (to 546c/kg) and 19.5 microns taking back 11c/kg (to 1068c/kg).
Many agents and their wool clients were hoping the market would make an upward turn last week at Newcastle's finer sale, but the overall weaker trend continued, although not at the same rate as previous weeks.
There were, however, some highlights at Newcastle for individual micron ranges.
The 17-micron wools were 29c/kg when compared to the Thursday before.
Australian Wool Exchange market information manager Lionel Plunkett confirmed a late rally on the last day of sales did give some confidence leading into September.
Landmark risk manager for wool, Anthony Boatman, said there was also some optimism on the forward markets.
He said the most liquid months were for sales out to December.
"The close months are tracking very close to the values for the current auction market, but it tends to differ the further out you go," he said.
He said depending on the month, there was still a good amount of bidding activity for growers to take advantage of.
The medium micron contracts at levels close to the spot market for expiries in the spring were popular, he said.
Taking a bigger picture look, Andrew Dennis from Elders said Spinexpo takes place in Shanghai this week, together with Idea Biella and Premier Vision in Europe, all of which will allow spinners and weavers to showcase their intentions for the next season, generate some enthusiasm and kickstart the stalled ordering cycle.
He said the current local market results did highlight the uncertainty facing the trade.
"There's widely differing viewpoints being bandied about depending on who is involved in the discussion," Mr Dennis said.
He highlighted Australian Wool Innovation's latest market intelligence report about the growing size of the over 50s demographic in the United Kingdom, German, French and Italian consumer market.
"During the next five years this demographic is not only forecast to grow in size by 10pc, but also their income will grow by at least 10pc as well, which magnifies the importance of this market," he said.
Mr Dennis said while the Chinese consumer market was developing during the next few years these fashion and quality conscious customers would remain the backbone of demand for wool.
"Stability appears to be gaining traction in Europe and hopefully the next move can continue along the path of positive news rather than the negativity of previous months."