WELLINGTON NEWS

Hokitika Guardian, 29 June 1926, Page 4

WELLINGTON NEWS

THE WOOL MARKET. (Special to “ Guardian.”) WELLINGTON, June 25. So far us Australia ami New Zealand are concerned the wool year closes with the end of the month. In Australia shearing will have begun on some oi the Queensland .stations, and new wool will be reaching the stores at tiro shipping ports next months. Sales in Australia of the new clip will begin in August, but it will not be until November when new wool will be offered by auction in New Zealand. At the opening of .a new wool season it is not unusual to find adverse opinions expressed and “bearish” attacks made on the trade. Wool brokers arc conversant with these tactic.s and take very little notice of them. Such pessimistic opinions generally emanate from. Yorkshire. but on this occasion America appears to have initiated the attack. Commenting on the Australian wool position a .Mr J. Wild writes in. the New York “Daily News Record” as follows:—“The American Woollen Company’s report for the year 192-I-25 can bo accepted as a premonition <d low prices in the coming two years. Instead of a market we have an attitude—a textile manufacturing industry formed into solid squares impregnable to speculative cavalry. Titus it may be reasoned that if wool declines slowly it will remain, down. If Australia cannot read the negative conveyed bv below 2 per cent earned on 50,000,000 dollars American wool during 1925 whither shall we turn for wool price education? In discussing the wool position we must also discuss the position of all raw materials. The ownership of raw material no longer attracts. For, three years more we are to face a situation that favours the distributor. Against the whole of 192(1 there is to he no wool supply anxiety. "Much of the wool and sheep news from Australia, covering the first quarter of 1926 apologises. In the main wo find the wool prices of early 1926 governed by the short supply campaign fiasco of 1921-25.” Fortunately neither Australia nor New Zealand is dependent upon the American market. Wool is a world commodity and America is relatively a

I small factor in the situation. Bradford j i.-, the world’s chief market for raw i wool, ami despite .the heavy drain on i British earnings caused by the enormous payments of wa.r dcbls.jlo America, in spite of the advantages more or less

at different times which some of the European countries have had through currency inflation, despite diminished trade Bradford remains the chief customer for Australian and New Zealand wools.

j ADVANCES DEPARTMENT LOAN, i It was stated in the Governor’s ; speech at the opening ol Parliament . that a loan ol 4(5.000,(100 had been ' raised in London which was generally known, and that £5,000,000 at 5.) per rent, had been raised for the Advances ; Department, which was not generally ; known. Last session authority was ob- | tniued to borrow £5,000.000 at the high J rate of 5-1 per cent., because the loan was to lie raised locally. The issue was I duly advertised and it is believed that j a certain amount of money was ohtainI cd in New Zealand, but the bulk of ;the loan was raised in Australia. 'J hos 1 New Zealand investors who subscribe.! j to the loan must pay income tax it they j are assessable, but the*- Australian ini vestors escape such taxation and in

j both cases the same rate of interest is i allowed. A good deal more inlormaI tion must he given before the | people are satisfied. It is also desn- | able to have some more information re- , ‘-peeling the operations of, the Advances i Department. Is this department able | to pay intrest on the money borrowed ; fur its service, or is the department ; leaning on the Consolidated Fund and | therefore on the taxpayers? Then j again it would be interesting to know what losses, if any, have been made by j the department through lending 95 per j cent of the value of the securities ! pledged with it. According to the | Minister for Lands values of broad j acres are sLill too high yet, the Ad- ! values Department is lending on the ; basis of these inflated values. A clear I statement giving the true position of like Advaiues Office which has now

, about £30.900.000 out <m mortgage is | very desirable, and it is the duty of j Parliament to see that the information is available to the public.