The Guardian And Evening Star, with which is incorporated the West Coast Times. THURSDAY, FEBRUARY 20, 1930. THE WOOL SITUATION.

Hokitika Guardian, 20 February 1930, Page 4

The Guardian And Evening Star, with which is incorporated the West Coast Times. THURSDAY, FEBRUARY 20, 1930. THE WOOL SITUATION.

The low level to which the price of woo! has fallen at this season’s sales has produced a situation that is fraught with danger to the industry, considers the Otago Times. The growers are naturally reluctant to dispose of their clips at values that may not be equal to the cost of production. It is hoped by them that an extension of the period uuring which the sales are held might result in their obtaining prices,that would not be actually unremunerative for the wool that at present remains unsold. The wool buyers have apparently reported to their principals that wool is being with-held from sale and that the brokers’ catalogues amount to only about- 50 per cent, of the allocations for f>ach sale. The representations which they have made have extracted a resolution from the British Wool Federation reaffirming its derision against an extension of the selling season, urging that, pressure should'be exerted on the selling brokers to offer not less tiian 20,000 bales per sale, and winding up with a cryptic thrust that if the season is extended beyond April 16th. the selling brokers “must accept

full responsibility and take the consequences.” It may be surmised that the Wool Federation’s main objection to an extension ot the season is based on the expense incurred by buyers in attending an increased number of sales at each of which the offerings vould be smaller than they have been 11 the past. It is, of course, cleatmat as there are some 60 to 80 buyers and attendants at the sales, the cost per bale to the principals through an extension of the season cannot be negligible But the additional cost which would have to be incurred by them is insignificant in comparison with the losses that have to bo faced by the growers through the drop in prices Primary producers have rarely any opportunity to control the prices of their produce. Because of the intricate machinery of distribution of primary produce, the speculation in it is greater than in anything else. It would be certainly speculative on the part of the producers to withhold supplies from sale, and the statement by the president of the* New Zealand Wool broker s’ Association that over 9U per cent, of the offerings at the last three wool sales in the South Island was disposed of under the hammer, indicates that the temptation to withhold wool from sale has in most cases been resisted. Growers, it may be concluded, fully, realise the danger of holding wools over, and of thus increasing the quantity available for sale in the following season. When the Wool Federation urges that pressure should be exerted on the brokers to dear the season’s clip by April 10th, it is apapietitly well satisfied to buy oti the present level, The effect or the decreased values oil 24,000,000 sheep and ott ; hundreds of iuillions/of acre's of land apparently does not weigh with it in its consideration 0) the position. Neither does the additional expense that must be met by ihe growers in their heavier interest bills, and by the brokers in their in creased overhead costs. Neither does the uncertainty of the position through the serious fall in wool values. The position is a very difficult one, and there is no direct way of meeting the situation. ’The effect will he feit generally, because tnere is going to l>e a very substantial drop in the year’s return on wool. The immediate plight, however, has to be settled, otherwise the buyers will carry out tneir boycott threat. Probably there will be some modification of the wool buyers’ attitude when actualities have to l>e faced, and it is to be hoped general conditions will be more settled and satisfactory ere another season comes round.