The Wool Market.

Press, Volume LXIII, Issue 19160, 17 November 1927, Page 8

The Wool Market.

The advance in wool at the Wellington sale on Monday was easily the best news for many weeks.' In the South Island especially, which produces so much more fine wool than the North, the amount of the advance has caused a real flutter of excitement. Considered opinion prior to the sale was that the demand would be firm at March rates, which were the best of last year's series. The average of twopence advance on fine wool, therefore, and a penny on crossbred, was far better than anybody was looking for. There is a tendency very frequently to over-state the extent of these advances, but the fact that merino sold in Wellington at up to 26Jd, whilst the highest price recorded last season at any of the auctions was 23Jd, suggests that the estimate of twopence fairly represents the appreciation on the finer classes of wool. In both cases, of course, these high prices were paid for the very choicest lots, and should not be allowed to lead us astray, but a conservative estimate of "average" prices gives us 23d to 24d for merino and 19Jd to 22Jd for fine halfbred. A Wellington message suggested that it would be unwise for growers to expect these good prices to be maintained, and the statement was made also (in the same message) that it is difficult to account for the advance. That is just a little suspicious. Although oyer- i

sanguineness is always to be deprecated, the fact to be remembered is that Bradford buyers found themselves unable to keep the pace set by the Continental and American representatives. The position was exactly similar ■ last season—the Home prices left no margin for Home manufacturers, and it was only at the second series of the sales, when the market had firmed, with every indication of remaining firm, that they entered the field and competed strongly. It is part of the luck of the manufacturing industry that these wools left little margin of profit, and it is quite time, as stated in the Wellington message referred to, that the wools sold there on Monday could not be realised in London at the same prices. This fact confirms the opinion that Bradford is not the dominating influence in the wool world that it was a few years ago. However, the advice against holding wool for a further rise is sound, apart altogether from the causes that prompted it, as wool is now at a highly remunerative price, and acceptance of such a solid measure of substance is sounder policy than pursuing the shadow, no matter how alluring the prospects may be. It may be mentioned, however, in regard to the statement that it is difficult to account for the sudden rise, that there is at least one potent reason. The Australian clip will be down on last year by 400,000 bales on the preceding year as a result of the drought, and the South African clip by 50,000 bales. This decline, practically all of fine wool, will make a serious hole in the supplies of this class available, and provides a very eloquent reason why fine wool sold so keenly at Wellington. An advance of twopence a pound on the two and a half to three million fine wool sheep grazed in Canterbury represents an acceptable appreciation in the pastoralists' income. : , i '