COMMERCIAL.

Press, Volume LVII, Issue 17105, 29 March 1921, Page 7

COMMERCIAL.

HOME WOOL SALES. EEGT7LATING THE OFFERINGS. (FROM OTHt OWN CORRESPONDENT.) LONDON, February 10. According to a statement issued by Sir A. Goldfinch (governing director of the British Australian Wool Realisation Association, Ltd.) stocks of Australasian and Falkland Islands wool remaining on hand out of the Government purchases amounted on December 31st last to 2,536,474 bales, of which 1,815,901 were from Australia, 703,212 from New Zealand, and 2331 from the Falklands. Of the New Zealand variety, 375,636 bales v, - ero in this country, 1011 in Antwerp, and 315,255 in Australasia, tho quantity afloat being 76.340 lor the United Kingdom.

The recent sales in London have evidently given anxiety to the directors of tho new Realisation Association, and Sir Arthur Goldfinch has addressed a letter to Mr W. Wcddell (chairman of the Colonial Wool Merchants' Association) asking for co-operation to prevent tho prices falling on each successive sale. "The London ' directors of 8.A.W.R.A.," says Sir Arthur, "have had under anxious consideration in their first two meetings the vcy difß-" cult problem of devising a method for regulating tho offerings of old and new clip wool in such a manner as to bring to an end the continuous downward tendency which has prevailed for so long. l" think the following conclusions might bo gratefully accepted by thoso. interested in tho sale of Australian wool: "Though there is still somo profit in the selling price of super, merinos, the discounts for lower quality and condition, imposed by the increased conversion co;t and preference for fine fr.br'Ci, bring about tho result that, on tho pre c ent bm-iis of fine merinos, coarso carbonising 1 wools hnvo a minus value in tho producing markets. It seems to follow that it "is foolish for tho producers to allow buyers to pick out tho very choicest parcels of merino wool dt the very reduced values of to-day. AGREEMENT NECESSARY. "Unless some agreement between the sellers of old and new clip wool takes place, there will be a tendency for prices to fall at each successive sale. Demand will not reach anything like adequate quantities until confidence is restored, and confidence will not be restored till tho fall in price ceaises. Therefore, the fall in prices must be arrested not by improvement in demand, but by concerted resistance on the part of the sellers. Tho holders of old dip wool have done- much more than their share up till now in the task of resisting tho downward filide of prices. It is morally impossible that this, should continue, and tho choice between the owners of old clip wool is either to maJco the sacrifice required to take their share of resisting the fall. or else to accept as inevitable that the ownersi of tho old clip wooi shall join in the scramble for the small available demand for wool. "Tho London directors are takingit for granted that the owners of aevf clip wool appreciate the position, or can readily bo brought to do so, and that they will not elect to oblijre B.A.W.R.A. to instruct the brokers to get a full Gharo of the sales for old clip wool by meeting the competition without limit. We have, therefore, been considering what would be a fair basis on which tho bu.ii.ness should be 'divided. Considering that we hold 2\ million bales of old clip wool, against a maximum cli» in Australia, and New Zealand of 2.150,000 bales this season, it would certainly nnt be unreasonable to expect to get half the pales in all markets for old clip wool. We are inclined to fear, however, that to insist upon this would much increase the difficulty of arriving at an arrangement. Our feolinct is thnt it would be practicable, and, though not fair to us, still more acceptable than the present position, if it could he agreed that the quantity of wool offered in Australia in each month should not. bo greater than the quantity offered in London. SUGGESTED TERMS. "All the wool offered in Australia will be new clip wool, and we' should havo to insist, therefore, that at least two-thirds of the wool offered .in' London should be old clip wool. If, for instance, it was agreed that 90,000 bales. should be offered in Australia, and 90,000 bales in England, the quantity of old clip wool • would • bo 60,000 bales, against 120,000 bales now clip wool. This is a much smaller proportion of old blip wool Ithan we were willin;? to agree to in' the discussion in August and September last, but I am most anxious to arrive at an agreement which can bo smoothly and promptly carried, out, and therefore I have made tho terms as easy as possible for the new clip wool. I reeogniso that, even so, the owners of the new clip will not do as well in London as thoy were hoping they would do, but theso hope* had no foundation, as it could not reasonably bo expected that the owners of tho old wool should indefinitely stand on one side to protect tho imports-of new clip wool into a market which is already so very fully supplied. COMMON SELLING LIMITS. 4 'ln' order to make arrangements effective, it would have to be agreed that common selling limits should bo arrived at for each sale, and that tho Com-' mittec of London Wool Soiling Brokers should undertake impartially to apply the schedule of limits to all wool with oul, discrimination, so that as nearly as possible not only the offerings, but the actual sales of the wool should oe in the proportion of two bales of old and one baic of new clip wool. I 'I am well aware that this proposal will offer difficulties from the point of view of importers, and tnafc there may be still greater difficulties, in carrying out that part of the arrangement which would apply to Australian sales, especially tho application of selling limits at the same parity of prices, which would, of course, be essential for the success of tho scheme. I wish, however, that you and your friends should at onco take these suggestions very earnestly into consideration, for I assure you that the present arrangements, which may possibly suit 'private importers very well, simply cannot be allowed to continue from tho point of view of tho 8.A.W.R.A., and, whatever else happens, we are never again going to see a repetition of the experience of the December and January sales. "What your friends, therefore, have to chooso between is an arrangement more or less on the lines which T have outlined, or else keen competition between old and new clip wool, whether we get it by agreement—as we would so much nrefer—or by competition, as we shall have to do if our friends refill to enter into a working alliance." NEW ZEALAND REPRESENTATION A proposal is now under consideration that the chairman of the New Zealand Advisory Committee to be :set up to represent New Zealand interests in the British Australian Wool Realisation Association should be made a member of the Board of Directors. If this idea is carried out, the Dominion's interests will be amply protected. The difficulty at present, however, h to obtain the services of representative woolgrowers in this country, who will be remaining long enough to take up their duties en the Advisory Committee.