WELLINGTON NEWS

Hokitika Guardian, 3 July 1925, Page 3

WELLINGTON NEWS

THE BUTTER AIARKET.

(Special to “Guardian”.)

• WELLINGTON, .July I. r I no dairy lai'incrs are to lie eongrati Mated upon their exceeding good iuek in having prices advance at a time when they should lie easy. Ever since the beginning of last month the market lias been improving. At first it was the strike of transport workers in Denmark that helped matters, then adverse weather conditions were experienced which cheeked the European production, and caused considerable alarm among buyers who were forced into the market. The prices realised before Christmas ranged from 2llos to 22Sn per ewt. but in January there was a sudden drop , prices going down to bids to lASs. The sharpness of the decline was not relished by I lie exporting factories and the distriliiiting houses in London were instructed to hold. This resulted in accumulations of New Zealand and Australian butter ami in .May it was estimated that there wen 1 about a million boxes held up. The exporters held for I7tls, and that price was reached some three weeks ago, and the quotations for finest salted butter are now lASs to 190 s. lids should have helped to clear the accumulations and no doubt it has. If so it makes the outlook for the rest of the season extremely good. As cheese prices are also tinner it is apparent that the European make is •short and that Canada is unable to make up the deficiency. The dairy farmers have had a Lit of luck but it is hardly likely that the factory directors will regard it as such. They are more likely to attribute the improvement to their own remarkable business foresight. The dairy produce market is subject to several influences as the experience of tlie past few lnontlis has sliovn. A strike of work-

ers in any of the more important producing countries promptly affects the market adversely. Climatic conditions are a potent factor in lifting the market because a natural shortage is created, but accumulating supplies and bolding for a price does nof always work. It would not have operated on this occasion but for the fortunate circumstance of a strike in Denmark am! hot weather in Europe. The fact o( the matter is that the daily produce market is an uncertain one, and tic fact that there are price variations every woelt and sometimes almost every day emphasise fill's. WOOL STABILISATION. The lliggin's scheme for stabilising the wool mark'd may lie dismissed as impracticable. It has been roundly condemned by prominent graziers in ; Australia, by the wool brokers and | business men generally, and havers are very much opposed to it. The fact that sales are to be resumed 111 Australia on July 13 on tin 1 old system is an indication that flic proposal has boon turned down. Australia is to marled 120,01)0 bales this month which is not a great deal seeing that sales have not lieeu held for some weeks. It seems that it will be necessary to limit i lie offerings because of the fin-

ancial position. At no point of the compass except tic United Shales is linanee easy, and to press supplies on the market would be dangerous. The trad' 1 everywhere, although bolding moderate stuck'., c carrying all the wool that can he financed, and time is necessary lor holders to digest what is on hand. Wool is not dear as present, prices. Inn i here H a lick c.i confidence. and bow lo restore confidence is tic nrohlcm of the moment. Anything Iha t would check the tall in values would have the oll'cet of restoring confidence ami bringing out orders for yarns and piece goods, and this movement once started would soon tiring about the icei-ssiiry adjustment. Elubora.e c mind systems on a bureaucrate basis will not help to restore confidence. The police lor the present appears to be to licet the market, and not to lone il, and so help in the icstoration of innfidencr. On Tuesday next the lourth of the series of London sales begin, and for this about l.’lli.dUO bait's are available, ol which a fair quantity will be New Zealand Wind. It would surprise no close observer of the wool market if London values show a further decline. The financial stress in France, Italy and Belgium as shown by the depreciation of the exchange value of their currencies, bv the increase of unemployment in Britain and the prospect ol an upheaval in the mining industry are all adverse factors and must hate a bad influence on a world commodity like wool. One aulhoritv states that a further fall of lo per lent, on fine wool would not he out of tlie way and it is probable that Mich a drop may he registered. I low-: e\or New Zealand wool growers and especially those who were fortunate enough to sell their clips can sit hack and watch events. Our now clip will not be on the market until November and a good many things may happen before then. Il to-day's prices can be obfiaini'd for cross-bred wool in November next woolgrowers will have no cause for complaint.