TRADE REVIEW

Dominion, Volume 14, Issue 138, 7 March 1921, Page 5

TRADE REVIEW

OPTIMISTIC FEELING ON STOCK EXCHANGE DROP IN PRICES OF FOOD AND RAW MATERIALS By Telegraph—Frees Association-Copyright. (Reo. March 6, 5.5 p.m.) London, March 5. After a fortnight of dullness and depression the Stck Exchange has taken a decided turn for the better, with an improved sentiment not, only in the investment sections, but also in the industrial and speculative groups. The amount of business done shows little increase, but an optimistic feeling is prevalent. The chief cause is the Premier's masterly presentation of the Allies’ case regarding reparation, and the announcement of Sir Eric Geddes’s retirement from the Ministry of Transport and the probable end of the Government control of the railways also had a stimulating effect on the railway section. Accumulation of Stocks. The Australian Exchange position, is gradually improving as wheat and other products are being shipped, but so far bankers are unable to increase traders’ facilities to any great extent. The trouble is the accumulation, of the past five months. Till that is removed bank-, erg cannot have the freedom of action necessary to put trade on anything like, its old basis. The movements in the wholesale prices of commodities during February were universally downward. The average level of twenty food commodities and twenty raw materials showed a decline of 9J per cent, compared with January, and -13 per cent, compared with February, 1920. American cotton, crossbred wool, jute, rubber, and tin are all bad, and all below the prewar level. Butter and Cheese. Butter supplies continue large, stocks accumulating and prices tending lower all round. Danish has been reduced to 2165. per cwt., f.o.b. The Government’s last distribution consisted of 80 per cent, of unsalted Argentine, which consumers do not like, consequently most of it was not sold. Although butter is very plentiful, the Food Ministry is not the price, as was confidently expected. It is understood that the Ministry is anxious to make a reduction, but the Treasury refuses its sanction as it would entail a considerable loss. Cheese is decidedly firmer. New Zealand white is quoted at 1475. to 148 s. per cwt., coloured at 158 s. to 160 s, No fresh New Zealand arrivals aro due till the end of the month. There, are hopes that present values will be maintained till the end of April. The Government’s final distribution -of imported cheese next Wednesday will clear the Government’s New Zealand stocks. Importers are well satisfied with the Surrey’s shipment. Australian is selling at the following prices:—White, life, to 148 s. per cwt.; coloured, 1525. to 1565. The Metal Market. The tin market is depressed, following the Malayan unpegging. The East shows no anxiety to sell at the present level, but the prospect of a free market in future has caused the premium on Straits to decline .£lO. Spelter is steady, owing to a feeling that the suggested export duty will cause a reduction in shipments from Germany, which is the principal source of supply. Present business with consumers is extremely restricted, but there js a slight improvement in demantl. Weak Demand for Wool. The wool sales just closing demonstrated the weakness of the demand, and the dullness in consuming centres, although present values are on so reasonable a basis as to encourage operations. American activity has temporarily ceased owinv to uncertainty as to the tariff legislation. It is probable that it may have a retrospective operation, but when the situation becomes clear a steadier demand for good wools in that quarter seems likely. Continental demands have been tho most stable factor of the sales, Germany and 'France both operating increasingly. Germany is once more making her influence felt on the raw material markets, which is an important step towards more normal conditions. Largo stocks and financial stringency are hampering the wool trade in Great Britain, retailers holding out for higher prices, based on the boom period rather than on the present cost of replacement. values at the retail end of the trade are adjusted there cannot be a general revival in business. The existing stock of wool must 'be cleared and the costs of production reduced before an increased turnover is obtainable. Old stocks do not present the same difficulty in America and Germany, where wool is going into consumption there more stead y. Aus.-N.Z. Cable Assn.