The Australian wool market is expected to open the 2004/05 season with steady prices this week, analysts said on Monday.
However, a very large offering of 88,314 bales nationally, and a rising Australian dollar, which pushed through the 71 US cent level on Monday morning, could place pressure on the market.
Last week, the AWEX Eastern Market Indicator (EMI) fell 1.3 percent in value to end the 2003/04 season, as it fell 11 cents to 816 cents a kg clean.
"Analysts are anticipating the market conditions of recent weeks to persist into (this) week's sales, being the last before a three week recess in both Melbourne and Fremantle," wool-broker Landmark said.
The upcoming mid-year recess could also support prices in the short term as buyers attempt to fill orders before the break.
This week, the bulk of the national offering is expected in Melbourne, with a good selection of best to good top-making styles between 17 to 21 microns on offer.
A varied catalogue of 21 to 23 micron wools is expected in Sydney, while average to best wools are expected in Fremantle, Landmark said.
"An offering in excess of 85,000 bales (this) week and marking the beginning of the new season could add further downward pressure to an already struggling market," the wool-broker said.
Accordingly, wool futures markets have started showing signs of weakness, under the pressure of a rising Australian dollar and falling cotton prices.
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