THE WOOL TRADE.

King Country Chronicle, Volume V, Issue 334, 4 February 1911, Page 2

THE WOOL TRADE.

O —<3> GENERAL REFLECTION OF FALL IN VALUES. In view of the report circulated that the fall in values at the recent Wellington wool sales was due to an arrangement between buyers prior to the sale to "'bear" the market:, it is interesting to note the present position on the Sydney market, rapidly becoming the most important woolselling centre in the world. Writing on the lSth ult., the wool expert of the Sydney "Mail," after calling attention to the fact that prices declined in all the Australian centres after Christmas, says it was seen from the outset that ihe market had lost ground, the decline being most pronounced in medium and inferior qualities. These sorts ruled from sto 10 per cent, lower, as did medium and coarse crossbreds.

fn some quarters it is held, says the writer referred to. that the weakness is due to a number of consumers in European centres being desirous of securing a longer mid-season break in Australasian sales. By others it is attributed to the result of the recent elections in the United States, and to the fear that another financial panic may ere long be witnessed in that country, following on the Democratic victory in November. The most feasible reason for the decline is probably that to which the Sydney authority attaches most importance. This is the exceptional supply of the raw matrial which has been unloaded on the market in the first part of the season, and more than the trade can absorb. The Australasian exports of wool to December 31st, 1910, show an increase by 111,000 bales over those for the corresponding six months in 1909. This has been going on with one of the most important sections of the trade suffering great depression. America, which last season bought over 100,000 bales, nearly all before the end of January, has this season bought perhaps 20,000 bales. Thus the Continent and Yorkshire have been called upon to take on nearly 200,000 bales more wool up to date this season than went that way during the first half of the previous season. As likely as not something of the same kind has been going on in connection with the disposal of the South American clip, with the broad result that though the volume of trade, and condition of trade, may be entirely satisfactory, the supply of raw material in the principal consuming centres in Europe to-day is over abundant. Four months ago it was the other way about, and everybody was hungry for wool. Now there is a glut, and still more wool coming along, what with 200,000 bales now available at the London sales, and the auctions in progress in the colonial selling centres. Whether the glut will prove to be anything more than a temporary one depends upon ine future course of trade, but in the meantime consumers have wisely determined not to go on piling up stocks of wool far in excess of their urgent requirements, all at high prices. If they are compelled to clear the balance of the supply as quickly as it can be brought into the catalogues and knocked down, they will only do so at figures which are considerably lower than those paid for the wool purchased earlier on, when supplies in the mills were exhausted and everybody was in sore need of more wool to carry on with. In place of keeping the trade hungry .for wool, jiroducera have overloaded the market, and a strong position has by their action been turned into a weak one.