Page 21 Advertisements Column 3

Press, Volume LXI, Issue 18407, 13 June 1925, Page 21

AUCTIONS. H. MATSON AND CO. IT MATSON and CO. take th® liberty of re-publishing this article, which is taken from the "Stock and Station Journal" of May 22nd. The whole article bristles with sound common sense, and in view of . the deputation at present hieing to Australia, we feel the article is a fitting one:— THE WOOL POSITION. THE GROWERS' STANDPOINT. A COMMONSENSE STATEMENT. By Ben Chaffey. Sir, —As a grower of wool on an extensive scale I am naturally vitally concerned, and hive followed with interest the various contributions in your columns bearing on. the subject. The recent groat fall in prices has apparently caused a good deal of hysteria, which has given rise to many unpractical suggestions, confusing the issue. Ji calm rev.ew appears to me to b© noceSßary. In the first place, several of the writers of the letters are neither woolgrowera nor business men, and it would have been better had they refrained from opinions on a subject of which .they have no practical knowledge. Bawra came into existence in January, 1931, and was formed expressly for the purpose of realising the wool remaining in the hands of the Central Wool Committee—the property of the British Government—and in which the Australian growers had a share interest in the ultimate profit realised. In 1920 prices for wool, as well as for other commodities, soared to a very high range —the trade*, rich from the war profits, embracing manufacturers and retailers, assuming a general world-wide shortage of wool and woollen goods, bought of both heavily at enormous cost. The shortage was there, but a miscalculation had been made as to the public's capacity to buy, and goods had to be quitted at a loss, and prices for wool receded to a low level. The establishment of Bawra was coincident, approximately, in time with the lowest ps>int in prices. These were bo low that they would not pay the increased cost of production, and much alarm was felt by all interested. At tbis junction Sir John Higgins was instrumental in bringing about a Government statute fixing a minimum pricu for all wool grown in Australia. The auction sales were proceeded with, and immediately a better demand was experienced, with rising prices, and but little wool was sold at the minimum price. From then on until November-December, 1924, prices continued to improve. The good effect of fixation of a minimum price was loudly proclaimed at the time, but, in my opinion, entirely without warrant. What really occurred was that the fixation of a minimum price and the turn of tho tide from the low range of values were simultaneous happenings. • The fixing of a minimum price in itself. could have had no effect other than the making of auch minimum price the real piica.

To hark. back- to the formation of the Central Wool Committee in 1916, and its operation until Bawra was formed, I would be the last to begrudge credit to its chairman, but it must be admitted that without the highly skilled' organisations of the wool brokers and "buyers, placed without stint at the service of Sir John Higgins, the operations and eucoessful issue of the Central Wool Committee would not have been possible. ■ It must not be 'assumed that Sir John did not make mistakes. Much wool was passed in 'or withdrawn after "peak" prices were realised in 1920 which would have been better sold, and wm sold at much lower prices subsequently. Bawra wool was all sold w England and on the Continent, whereas, even if a portion of it had been realised here, an appreciable sum of money would have been expended in .wages in Australia, - and heavy storage charges in England would! have been avoided, high, rates of. exchange oosts in bringing money from England would have been saved, and mora remunerative rates of interest would have been received if the funds had been locally invested. Sir John might retort that the prices paid in England were higher and compensated for exchange, etc., ■but it is now generally accepted as a fact that the Australian markets are the best for Australian wool, and the buyers can give relatively more r for wool for shipment direct from the piace of production than in a market to reach -which, and to its ultimate destination, the wool has had to be 'Handled at least" twice. " The buyers are forced ■to , come to Australia in increasing -numbers, as otherwise they would be denied the opportunity of procuring at first hand ;the wools suited (to their several requirements. ' Like the neat of us, Sir John is . human, asi in making the above criticism I am not seeking to detract from the 'oredit due to him for the work he has done. The present comparatively ■ low • range of values' is the inescapable and logically economic outcome of the boom prices of last year. Every such boom in the world's "history has had a like result. > I, am afraid that. the high prices made the opportunity for the. substitute known as artificial silk to ge£ a footing, and it is a competitor we cannot disregard. Made from wood pulp, there is no shortage,' nor- can there be any in its supply-of raw. material, a'nd the huge profits made recently by those engaged in its manufacture should warn us that its production has reached enormous dimensions. The world's population is on the increase. The use of wool is extending, with new customers always coming along; but do not lefr us estrange them by indulging in foolish measures such as attempting to make a corner in wool. Such expedients have been tried before, time after time, but never with ultimate success," and have always ended-in disaster.

It must be borne in mind, too, that the present range of prices is higher than anything experienced prior to the war. Our vision has been distorted by the abnormal war and subsequent happenings, and some of -us are still apt to lo3e our sense of proportion, and to be carried away by the ideas of visionaries in relation to the • stabilisation and fixation of prices. The millennium is nit yet. I have been engaged all mylife in the breeding.of sheep and production of wool, and would reeent the dictation of anyone not so trained in the conduct of my business as a woolgrower. When by wool is ready for market I look to my broker to protect my interests. The woolbroking business .of Australia is in the hands of highly l skillftd men of great fxperience, and is deservedly. regarded as. being conducted Under conditions generally admitted ais above reproach. Many of the brokers are interested also as woolgrowers, and practice ally, all'of them act as bankers for growers, and are equally interested with the growers in obtaining as high a price as possible for our wool." No sane man could or would attach any blame to the brokers for the recent debacle in prices, and I would strongly object to the Federal • Government, influenced by Hysterical agitß.uon> bringing in any futile legislation with the object of forcing me to entrust the realisation of.jny wool to a body of more or leas inexperienced men. It should not be lost sight of that to give effect to the chimerical ideas of stabilisation or price-fixing Government intrusion cannot be avoided, and if woolgrowers a ro bo foolish as to take away the conduct of their business from experienced brokers and hand it over to a body under political control, then God help the industry, and I for one shall go out of it as soon as I possibly can. - ■ We aro told that the liquidation of Bawra cannot be proceeded with until litigation activities are at an end. Why cannot a liquidator be appointed/at once, who would declare a substantial dividend: and etilll retain funds enough to. cover any adverse verdict which may be delivered. We would all bo glad if Sir John would -undertake the position as liquidator, and I can assure him we can do with the money.—Yours, etc., BEN CSHAFFEY. Manfred Station, Balranald, (N.S.W.), May 18th. MESSES H. MATSQJ? and CO. are at present booking orders for woolpacka for the coming season, and' make direct application to you, if you are a woolgrower for j,he handling of your wool- for the coming season. Our business is a direct and. personal one, and we keep closely in touch with all the Centres, and are more than efficiently posted as regards the various m arthe World. In fact, we honestly"believe that there is,no Finn in New Zealand that makes a closer study of it t 1 "'" we do: As heretofore, we want all producers to look to us as of old as .their adviser, their counsellor, and' their friend. We want their business,' but first and foremost we want.to be able to give them the very best service ,it is p#ssible, and the best advice as to how, wl*n, and where to realise their products. MSM2 H. MATSON and CO.