The Guardian AND EVENING STAR, With which is incorporated “The West Coast Times.” THURSDAY, AUGUST 25th, 1921. THE AUSTRALIAN WOOL DIFFICULTY.

Hokitika Guardian, 25 August 1921, Page 2

The Guardian AND EVENING STAR, With which is incorporated “The West Coast Times.” THURSDAY, AUGUST 25th, 1921. THE AUSTRALIAN WOOL DIFFICULTY.

In the course of a review of the Australian wool difficulty, a correspondent writing Home reviews the situation, and explains the special plight the Commonwealth is suffering under. He goes on to say that the present time the difficulty experienced in disposing of wool dominates the whole financial and commercial situation of Australia The value of the wool exported accounts , for between one-third and one-fourth of the value of our total exports, which provide the wherewithal to pay for our imports. If, then, our exports fall off it is clear that we shall buy less from' abroad, that our import trade will be | decreased. Our wool exports threaten ! to lie very small this year, all because I of the stocks held over by the Britisl I Government from Australian and New . Zealand clips and now being placed on the market. There is no need here tr enter into the schemes which have been proposed for lessening the difficulties which have arisen, hut it is well that British merchants should know wlint will he the result if the present and ! the future Australian clips arc not sold, or are sold at such a sacrifice as to ruin many of the smaller patoralists, i and the smaller pastoralists to-day predominate and furnish the bulk of the clips. As we see the position on this i side, the forcing on the market of the f held-over wools, for which the British j Government has already received the ] full price it gave, will force wool prices • considerably below the price of prodiu- ]

tion, and oven then will result in perhaps, a failure to realise half the present clip and half next year’s clip. Last year the Australian pastoralists experienced bad weathep conditions. They had to spend much of their capital in hand-feeding their stock, buying feed up to £l4 a ton, training it hundreds of miles, Pnd paying much labour to distribute the feed in the paddocks. In thousands of cases th 0 process of handfeeding was continued for nine months. Further, the Jamhing was practically a failure. The average for Australia was it is estimated a drop of 33 per cent., instead of an average of 75 per cent.. The pastoralists had to call on their hankers for assistance and the banks responded very willingly. The result of the drought is seen in the present clip, in its condition as - well as in its quantity. Tf that clip is not disposed of, it will mean that those whose wool is held over will go bankrupt, and even in the caso of those whose wee 1 sold the appearances to-day are that the price will only be about the pro-war rate, whereas all expenses are considerablv higher. In these circumstances a severe diminution in the national income is looked for, not only the Government revenue but the income of the individuals. Imported stocks are very heavy, and with this diminished income looming before them Hie merchants are proceeding very cautiously and are not buying to any extent from abroad beyond bare requirements. Imports will have a severe setback. The proposal which is most generally favoured and one which the Prime Minister now on his way to London is expected to discuss with the British Government-, is that the held-over wool should be kept off the market &>r a, still further ' period. It is pointed out that the BH- j tish Government will flutter no loss ex- ! cept storage charges. That, however, I lias this disadvantage: it may be but ' a postponement of tho evil day. The i wool must be realised some time. What guarantee is there that it will not cause the same conditions in the market thre e ' years hence as the intention of now putting it on the market is causing to-day ? I