Aust. Scouring Industry Crisis

Press, Volume CVI, Issue 31079, 7 June 1966, Page 9

Aust. Scouring Industry Crisis

(N.Z. Press Association—Copyright) SYDNEY, June 6. The auctioning this week of an entire Botany (Sydney) wool scouring and carbonising plant reflects not only the liquidation of one of its joint owners, but also a crisis facing the Australian scouring industry as a whole, according to the “Australian Financial Review.”

It says: The company selling its plant is Floodvale Pty. Ltd., jointly owned by Lon-don-based Dreyfus and Company, which was recently put into liquidation, and by the Belgian company, P. J. Zurstrassen et Fils,' through Its wholly owned Australian subsidiary. Wooltex Holdings Pty., Ltd. Floodvale's Botany plant, established more than 40 years ago by an earlier partnership, has a capacity equal to or bigger than the Botany wool subsidiary of Felt and Textiles of Australia. The decision to sell came after dwindling activity in the scouring industry had reduced Floodvale’s throughput to less than 50 per cent of capacity. In former years, Dreyfus and Zurstrassen themselves accounted for about 85 per cent of Floodvale’s production of scoured and carbonised wools.

Dreyfus announced in April that it could no longer carry on business, and after a meeting of creditors in London last month, the company was placed in liquidation. Efforts to sell the plant as a going concern proved unsuccessful. The reasons for the lack of buying interest show up starkly in this season’s statistics from the National Council of Wool Selling Brokers of Australia.

These highlight the fact that overseas mills are no longer prepared to pay premiums in Australia for the advantages of getting their wool in a semi-processed form and with a lighter weight for shipment For the 10 months of the 1964-65 season to the end of April, the avenge price per lb of scoured wool was 63.92 c compared with 49.31 c for greasy wool. For the same 10 months of this year, the scoured average has dropped to 52.37 c per lb, while the greasy wool average has recovered to 50.38 c.

In April, the 50.16 c average price per lb for scoured

wool actually stood at a discount of 2.13 c under the greasy wool average. With the additional limiting factor of the drought to contend with this season, exports of scoured and carbonised wool for the nine months to the end of March were nearly 10 per cent below those of last year. A major factor in the decline has been the emergence of Japan as the dominant buyer of Australian wool. Although Japan was buying large quantities of scoured wool in Australia eight to 10 years ago, the proportion has progressively dropped as it has built up its own scouring industry. Although Floodvale’s assets are being realised, no firm decision has yet been taken on the company’s future.