OVER-PRODUCTION OF WOOL.

Hawke's Bay Times, Volume 14, Issue 731, 1 November 1869, Page 3

OVER-PRODUCTION OF WOOL.

(Australasian.)

This is, of course, the first reason to be assigned for the late fall in prices, but the question for sheepowners to consider is, whether that over-produc-tion should be looked on as temporary or permanent. Is the production of wool increasing faster than the purchasing power of the world at large, or has this purchasing power received a temporary check, from which it will speedily recover? Although the quantity received in England is very great now compared with what it used to be, the increase has been steady, and not by any means sufficient in one year to cause such a decline as took place in 1868. The figures in support of this belief are given by Mr Thcmas Shaw in another column, and to a certainty during many previous years the annual increase has been met by an expanding demand, able to take everything in the shape of wool offered, and without any material depreciation in value. In the first place, the scarcity and high price of cotton caused a greater consumption of woollen goods for some years. Then the custom of wearing woollens continued for a while after cotton became cheap ; but after the high price uf bread for so long caused the back to be starved that the belly might be filled, the manufacturers kept on making up and filling the warehouses with goods, until in 1868 they found themselves with large stocks on hand, and a slack demand. Thus there was undoubt&dly over-pro-duction of the raw material beyond their wants; but this was preceded by an over-production of manufactured goods, which the people, if not hungry, still rather pinched in regard to food, could not afford to buy in such quantities as they did a year or two before. The demand for the more expensive articles of clothing, as woollens are, falls off sensibly as the prices of food increase, and does not recover for a time after the immediate pressure ceases. It is also to be supposed that during the pinching times the habit of wearing the cheapest, or cotton goods predominates again, and that the former consumption of woollens is not resumed until a more prosperous people are induced by the falling prices of these to return once again to the wear found to be most comlortable. Thus a reaction of this sort does not set in so speedily as many might suppose, and we have no reason to fear because wool fell most just when bread was falling too. The surplus of woollen goods was accumulating during two years before, and there must be a year of cheap bread ere the full power of a people for purchasing clothing returns. Therefore a full reaction should not be expected uutil towards the end of this year, when the accumulation of woollen goods ought to be nearly worked off. And, as this scarcity and high price of food were felt even more severely in some of the countries of Europe than in Britain, the want of spirited competition on the part of continental buyers at the late sales is on this hypothesis easily to be accounted for. But even during this period of lowest depression, owners of good sheep have little to complain of. Our best clips were sold at the last sales at prices

ranging from 2s to oi, a few bales fetching a trifle over the highest iigure, and we have been informed oti undoubted authority that the whole of the fleece wool <f one well known brand was sold privately at a fraction over half-a-crown per lb. Some of our greasy wools, too, fetched Is Gd per lb, and these are prices that will pay well, in conjunction with the somewhat improved and more steady prices that will rule lor fat sheep through the coming season. But to fetch such prices, the wool must be good and well grown, without the weakness or break

consequent on starvation through several months of the year, The first step towards general improvement on the part of many owners whose sheep so much need this, must be a determination against over-stocking, that they may be enabled to grow true combing wool. There will never be an over-production or much further deterioration in the value of this whether the European markets fully recover their tone or not. But whether or no, short, ill-conditioned, ill-grown wool and dirt will not pay, for of these there will assuredly be an over-producliou in many parts of the world besides Australia, and no great rise in value is again to be looked for. However, for the reasons given before, and others adduced by Mr Shaw in his letter, there is every prospect of the reaction setting in this year, and of the idea of general over-production being scouted once more. Markets for every description of produce, suitable for either food or clothing have their periods of depression and buoyancy, and many such changes in regard to the value of wool have been already witnessed since this became a staple product in the more recently peopled portions of the world —-to the undue alarm or elation of the settlers therein, as well as of all connected with the vast interest depending oa the raw material they furnish.