London Produce Market

Levin Daily Chronicle, 24 March 1917, Page 2

London Produce Market

$ BANK OF JS'EW ZEALAND'S iREPORT. From Mr C. H. Pyke, Levin, branch manager of the Bank of New Zealand, tlie Chronicle is in receipt of a copy of the January report of the bank's London office on the London produce market. It runs:— London, 19th January. Wool.—The gross quantities of colonial wool imported during the course of the eight series of sales for 19'iG, and the quantities catalogued for the same period 1 were as follow, the total i'or 1915 being also shown for purposes of comparison:—Arrived during eight series 191(3, 1,425,818 bales; eight series 1915, 2.161.441 bales. Catalogued during eight series 1916, 746,825 hales; eight series 1915, 1,128,058 bales. Looking back over the operations of the past twelve months, the retrospect is one of absorbing interest. Like the previous year, it lias been a period of epoch-making evolution, in which traditions and practices which convention had made sacred in the past have been „ swept away, and new rules and systems which a couple of years ~ ago would have seemed too revolutionary to be possible have been brought into" being. No doubt these are merely war-tme' expedients, but even should the intention of reverting to the old manner of things be adhered to, there is no doubt that the developments of the year will exert a powerful influence on the future of the industry.

It is somewhat difficult to place in their true perspective the various momentous occurrences that have made the past year probably the most event-* fill in the history of the wool trade. A constant and .growing demand created by the colossal military requirements, the urgent claims of export trade, the restrictions on home trade and the extraordinary difficulties in the way of production, would have L pen sufficient to mark the period wider review is being without parallel in the annals of the trade; when,- , in addition, account is taken' of the tremendous and far-reaching effects of Government control which i 6 now in existor.ee; it will be admitted, mere words fail to adequately describe the upheaval which has . taken place. There is little doubt, however", that the influence of State -control overshadowed everything else and constitutes the outstanding feature of the whole year. Turning next to the course of values, which after all is naturally the growers' chief absorbing interest, these exceeded the most sanguirfe expectations, and soared to a level hitherto unprecedented in the trade's history. The demand for wool lias been phenomenal, and the supply has been -below normal. It is no exaggeration to say that ever since the outbreak of hostilities there lias ibeen a growing wool hunger in consuming centres, and, therefore, it is difficult to understand the authorities' apparent lack of foresight in allowing the U.S.A. to lift such heavy weights of wool in Australasia, which the Home trade could very well have done with. By eliminating competition of this nature in the primary markets, many of the subsequent difficulties might have been avoided if this great source of national wealth had been earmarked for Home industry at the commencement of the season. While, no doubt, the rise in freights, insurance and other transport charges contributed- to the inflation of prices so far as the raw material was concerned, it would appear that the shortage brought about by the very extensive American purchases in the Dominion and elsewhere was primarily responsible for the substantial advances in prices recorded from time to time,...

With so many adverse factors operating against normal production and with the constantly increasing demands of the Allied Government for cloth, it is not surprising that the authorities began seriously to consider the advisability of assuming some form of control over the industry. Tha first important step in tliis direction was the commandeering of the (Htome clip, and tliis was rapidly followed by a system of control of machinery and labor, together with a census of stock and plant that gave precedence to military requirements, the export and home civilian trade taking second and third places respectively. The "Government made it clear that it intended to conserve wool supplies in the interests of the Allied powers, both for

army requirements as well as trade after the war, and in the autumn it became evident that embargoes . on shipments from the colonies were not sulficient to secure to secure the object in view. Hence came the most sensational development of all—the purchase of the' Australasian clip towards the end of the year—to the consternation of the trade,' which mistakenly assumed that the Government would hesitate to undertake a scheme of such magnitude, after its experience with the British clip. Merinos. This class of staple, supplies of which are all too scarce from New Zealand nowadays, has experiened a year of unexampled prosperity. An excellent idea of the advance in values will be formed when we state that on the average prices are fully 50 per cent dearer than December 1915. ■Russian buying of superior scoureds has again been notable throughout the year ,otherwise there has been no outstanding feature. The most solid cause for satisfaction was the extraordinary strength of the market for carbonizing wools, and it is a matter for congratulation that in future these will be less dependent on Continental support than they were before the war. Orossbrals.—The past year has certanly emphasized even more than during the previous season the important part which crossbred wool is playing in conducting the war. Apart from a surprising setback at the FebruaryMarch sales, it has been one steady upward movement in values dictated <by an ever-expanding consumption. Buyers were rather disturbed by the Government's action in buying up the British clip, ias they feared that the values of the colonial article would be adversely a'ffpcted. This, however, did not happen, hence during the autumn the demand improved and at the close of the year values on average were 30 per cent dearer than December .1915, which will give a pretty good idea of how satisfactory a year it has been for those growers who consigned to the London market. Lambs' wool, in good condition, mot a steady demand all through the season," but seedy shabby descriptions were* at times almost unsaleable. Wliped wools.—The quantities catafogued wero the largest on record. Prices for these have broken till previous records, manufacturers having more than ever discovered their real intrinsic properties in the manufacture of khaki. Several new .brands appeared

tile catalogues; with scarcely an exception a. high standard of excellence was achieved. The well-iknown brands we examined were very satisfactory both as regards quality and condition, and reflect great credit on the works producing them. Outlook.—There is so much room for conjecture and so little in the way of precedent to guide one' to a reasonable conclusion that many people prefer to keep an open mind as to the future of wool industry after the war. The bolder spirits, however, go so far as. to predict that something like presentprices will continue for some time after the present struggle terminates while others hold the. view that with tlie cessation of the demand for khaki, etc., we shall see a considerable feduction in values for all classes. A great deal will depend on- what facilities are granted manufacturers and shippers for doing trade with the outside world. It is well known that neutral countries are very short of wool, and if granted a reasonable privilege of buying it is not at all unlikely we shall see a 'maintenance of current values. There is not the slightest doubt that our own people are to receive first consideration, while most assuredly Germany, which must be in a chronic state of wool starvation will not be permitted to buy anything like she did before the war. Looked at from any "point of-view there is ibound to .be an enoimous demand for wool after the war, andi on that account it is to be hoped that the future will be full of good things for the whole industry. Hemp.—The difficulty of obtaining freights still accounts for the absence of offers from the Dominion and consequently values have advanced £4 per ton during the past month. Business going on is of very small dimensions, and values are nominally: High points fair £58 10s at £59 per ton; fair £57 10s at £58 per ton. The above vales represent an advance of about £22 per ton compared to corresponding period last year. Dairy Produce: Butter.—Values lately have eased off and the general demand throughout the country, even at the lower prices is dull. The decline. is 2s at 4s per cwt, and the 'best salted is now quoted 204s at 2065, with unsalted at 208s per cwt., compared to 150s at 162s per cwt at the corresponding period last year. Cheese.—We understand it is unofficially stated that the price to be paid by the Government for the season's output is 9Jd per lb f.0.b., but it is generally anticipated that a certain proportion of the arrivals not required for army purposes will 'be disposed of through the usual channels of distribution. Meantime prices for other descriptions are very firm with a distinct upward tendency.