Market volatility was displayed last week with the wool market in the north having a go at seasonal highs on Tuesday.

Wednesday saw both northern and southern market prices move down to erode most of the previous week's gains.

The $A bouncing to near 54.4 US cents left many wool traders unhedged short term and in a difficult position to purchase wool. The Eastern Market Indicator finished the week down 24 cents at 927c.

The 21-MPG failed to rise above 1020 to 1040 cents and finished down 37 cents. Price falls in the next couple of weeks appear limited to 20 to 30 cents at worst with new Chinese orders for prompt delivery placed late last week.

The prospect of high price volatility in the greasy wool market remains. So far the medium micron categories, after reaching high prices in February/March, have traded in a line to come to price range of 80 to 95 cents. In the short term processors are buying wool on a hand to mouth basis, with exporters struggling to come to grips with the extreme supply uncertainty of buying wool at auction.

This week there was an offering of more than 73,000 bales. The wool market appears to have decided that the February/March price highs will not be exceeded this season.

Elders reports fresh Chinese orders for prompt shipment. This should help see support for prices at around current levels during the next two weeks. Man Made Fibre (MMF) prices are generally reported to be rising, with some jumping by 10 per cent or more from the last quarter of 2001.

While the MMF prices have not risen as fast as wool prices it seems there is a general move up by textile fibre prices around the world.

This current market volatility demonstrates the value of the Good Till Cancelled Orders Use the new GTC forward via the Elders Exchange Desk or the Offer Board for wool on hand.

Cameron Smith and Marc McKellar,

Primac Elders.