WELLINGTON NEWS

Hokitika Guardian, 27 August 1929, Page 2

WELLINGTON NEWS

PERSISTENT DEPRESSION.

(Special Correspondent.) ■ WELLINGTON, August 26. Mr W. H. P. Barber, Chairman of the Wellington Woollen Company, sets a very good example, of what the chairman of a joint company should do, for at the annual meeting of shareholders he goes somewhat fully into all the factors bearing on tho,.various sections of

• the wollen industry. At the meeting '6f the Company . last Monday, Mr Barber had a good; deal to say about the /persistent depression in/the wool trade; ' and the remedies for the same from

his point of view. .The wool trade depression has been discussed at length both here and in Australia and the, general impression is . that there are several factors accounting for the fall in prices, such as the .menace of artificial silk,) the menace of short skirts, the menace of cheap Continental labour and long hours of work, and the

menace 'of new machinery in France rendered necessary by the destruction off' the. mills during the war.

The price of wool has declined, and so far as merino, is concerned the drop last season is estimated at 25 per cent. But it must not be forgotten that, wool prices advanced; and the drop now is natural. Wool is still far from being at the prerwar level. When after the war wool soared the whole trade from

growers to. manufacturers capitalised, more or lesi, the higher prices. In th® case of growers'th® capitalisation took the form of assessing farm lancjs higher. ' The slump of 1020-21 showed the rank iistupidity of this. Wool js

down,. and ; .is .likely to remain down for it is merely following in the wake of other commodities. - This is a period of falling prices and farmers as well ns manufacturers and traders, must try

to realise this. Mr Barber’s cure ifor the wool depression is more protection for the woollen industry,? in other words .Mr Barber wants. the Govenment to fprce. ‘;tho' peopie into buyjng locally; goods at. higher prides than' i|uported goods, and thisi - is to be achieved ;hy. the increase of' duties;, on imported goods. The consumers are to suffer for the benefit ’of ' the industry',, and as the industry employs ajKandfhl of .men' and women, the scheme • suggested means penalising the - many-i der 'the benefit ’of the few. Mr Bhrber pointed oiit Ithat incessant change is aiifeatrireof modern life,’and t>vo pr three garments of inferior quality are now bought where one of honest make would, as of old, he better : for ; l)6th; appearance and pocket.' _ . If - incessant' change is a. feature - of ; modern-life should not a modern manufacturing concern so arrange its affairs

to meet the exigencies of modem life? New Zealand is not peculiar in this respect, for it is world wide and manu-facturers'-in other countries have to ‘ face the same conditions. Mr Barber’s attitude seems to be “ Don’t cater for your own fancies and tastes and ,purse limits by buying cheap goods, hut buy the goods of the Wellington Woollen Company at the company’s prices.’-’ To enforce this he wants the Government to raise the import duties. The consumers have the right to ask the •’ various industries that are clamouring for increased protection. “Have you

placed your house in order?” One of \ the most interesting developments • c>f industry; since the war has been the rapid growth of efforts at standardisation. '\ • • , ’ Standardisation is closely allied with scientific management on the one hand, and rationalisation on the other. What have any of our industries done in that direction? They are carrying on practically in the old pre-war. .style, and want the Government ‘to help them to continue in this old way. Rationalisation, standardisation, ( and scientific management are peculiarly applicable to the woollen industry, but no effort has been made, or is likely to be made, because a barrier of vested interests blocks the way. and so it is thought that it would be easier ?to raise the tariff walls. 1 But rationalisation and standardisation mtist be. taken in hand if the woollen manufacturing industry is not to- become extinct in New Zealand, like jthe moa. The industry must adopt new methods for meeting the new conditions.

FAVOURABLE FACTORS. Amongrthe many figures compiled for the firstuhalf of the year the bankruptcy returns are most favourable. During the period there were 340 insolvencies throughout the Dominion as against 385 in the corresponding period of last year, a decrease df 45. The shrinkage has occurred wholly in the North Island, the figures being 229 agaisnt 280, a decrease of 51 equal to about 18} per cent. The South Island figures are 111 against 105, an increase of 6. The number of deeds of assignment m the half-year was 91 against 112, a decrease of 21, equal to 19 per cent. WOOL REVIEWS. h •, WELLINGTON, August 24. The wool year having closed ini Australia and New Zealand we are now being regaled with reviews of the season which terminated on Juno' 30. Dalgety’s wool review is invariably interesting find comprehensive. Besides a wealth of statistics there are numerous articles of an instructive character. According to Dalgety and Co. the sale figures in the Commonwealth show a substantial increase of 233,802 bales, a total of 2,645,695 bales, com-

paring with 2,411,873 bales in 1927-28. The Commonwealth sales values were £3,751,606 lower at £57,122,056. The combined clips of Australia and New Zealand realised £69,339,438 as against £73,877,862 in the season of 1927-28, while in 1926-27 the realisation, was £64,818,586. In the season of 1920-21 the clips of Australia and New Zealand realised £15,475,014, rising in the following season to £41,504,090. In the next two seasons more money was realised, reaching over £69,000,000 in 192425. v Wool values are never stable, and that must ever be, for there can be no stability either in supply or demand. Wool values declined last season and they show every indication of declining this season, but the same things occurred in Seasons ,of 1925-26 and 192627.. A further fall in values in the coming season will be in accordance with past experience, but wool is not likely to remain depressed, even with the competition of artificial fibres. It must be remembered that population is increasing faster than the production of wool, and there is consequently scoira for the synthetic fibres without seriously menacing wool. At the moment the stocks of tops on the Continent still high, and that is a brake on orders from that quarter. The present dullness is partly caused by the uncertanity of the value of wool. If, as anticipated, Japanese demand shows reasonable strength when the Australian season opens next month, it should assist materially in producing a more stable level, of prices which will provide, a guide to the trade in all directions. A strong buying movement from an influential quarter would give all concerned much needed courage. The position is peculiar. If tops, yams and other manufactures commenced to sell freely the .raw material markat would be favourably influenced. Were the latter to ' display strength tha former would benefit. It is- just possible that the Australian auctions next month will clarify the position.

. Dennys Lascelles, Ltd., a wool-brok-ing company with offices in Geelong, Victoria, in their wool annual have softie interesting articles. Most interesting of these is one dealing with sheep-breeding in South Africa. The writer’s conclusions are succintly stated. ' There is (he writes) plenty of sheep' land; to* be had in South Africa, but it wants capital to develop it, arid then it will give a handsome return. Land and income taxes are negligible, and labour is cheap, so that the cost of wool .production carried out on a proper basis will be the cheapest in the world, and ' the proximity to the European markets will still further help the woolgrower.'

Although it will be an increasing industry in South Africa and fortunes will ,be made, yet there are plenty of classes .otf wool grown in Australia today that South Africa can never be a competitor in. The wool they call fine .does not pay to grow, and every year will'mean greater cost, as the sheep do not cut enough, and where these fine are grown the properties are advancing in price, and the interest return from capital is increasing fast. If farmers are to produce more of this wool they will have to improve their veldt, and this means increase in capital and the return will show a lower rate of dividend.

Taken generally the great bulk of the wool in kouth Africa is more like the Riverina clips, except that owing to the want of shelter timber the wool is exposed more to the weather, and as dust storms and dusty winds are comnfon in some more than in others the wool gets, very dusty and dry, and consequently the yields are low and a great deal of nail comes away from the wool. Then tliere is a lack of uniformity in the fleeces. Some will weigh up to 121 b and others in the same clip as low as 71b. They also differ in qualify and appearance. This is due to mixing blood indiscriminately, 'taken altogether there is room for a tremendous lot of improvement, and with more careful attention to pastures and the provision of ample feeding during the whole year there is no reason why the wool clip of South Africa should not more nearly approach the general average of Australia than in the past.