THE WOOL MARKET

Marlborough Express, Volume LXII, Issue 269, 15 November 1928, Page 7

THE WOOL MARKET

THIS WEETv'S SAJ.F. AT WELI.INGTON. A SAfAf.L OFFERTNG.

Exnress Sneeial Service.

WELLINGTON, Nov. 14. Owing to the adverse weather conditions; experienced during the last few weeks, shearing has ))'ee,>i retarded ; consequently the offering at the first sale in Wellington on Friday will not consist of' more than about 7000 bales, as compared with over 9000 bales at the ♦•orresponding sale last year. The general belief i.s that the values wilL racede, but that faetor has already been diealt with somewhat exhaustively. Interest.ing coimnent is miule by AVincheombe Carson Ltd.. the weil kuown wool btokers, ' oi Sydney, with regard to the experience of tlie wpol. trade during September. What is shown is the important part confideiKje plays in the sale of wool. From July to August- trade on the C'ontinent and Yorkshire was qmet. No wool saies had been hekl and all thoise conceirned were uncertain with regard to the price tlie new seasons wool would command. Not only Wns tlie manufacturing side of the iudustry oonvinced that it could not operate profi.ta.bly on the basis oi ihe prices ruling towards the latter half of the season, but it was also nervons >as to what might happen should there be a readj'usitment of l^fices. The mill owner.s dcsired che.a,per wool, hui; the trouble was that no one could tell hina how far a.uy receding movement would go. If no oue bad the courage to- step in, a relapse might have occurred, such as has been experienced on previous occasions . With the world possessing no surplirs, stocks oi raw material, the risk of a slrnr.p was mmiinised. Japane.se and Gernian consumers appeared and beeame factors m re-estaiblishing confi.dence Wiiat foilowied wias, that w;ithi,n. a. few weeks those requiring wool. again operated freely in tlie market. AVinchcombe, Carsoe. Ltd.. write fbat. there was no great- reviral :n trade to acoounr for the. restored position. AVhat liappen ed was that nervousness disappeared ond a more buotant Tniarket resulted. Attention is directed to the f'act that on three occasions only in the last eight years has wool realised better prices tlian those a.\vailable. this seasoii, a.nd on eaeh of these occasions a, setback had subsequen tly occurred. The deduction was that excessive prices for the staple created false ideas as to the wool eafning capacity of flocks and placed prices oi slieep at a point from whiich they had eventua lly to recede. The firm states that it feels cheerful as to tlie prohahilitv of wool selling freely on about the current level. of prices. but it does not expect to see a definitelv rising market for tlie staple This is somewhat cheerinig. Alsesvs Da.wson and Co., tlie London wool. brokers, writing immediately after the close of the last series of the London wool saies, w'hieh ended on October 4th accounting for the woalc and erratic state of the market and the drop in prices, pointed out that the difficulty of obtaining any new business for yams icxcept on last seaison's

elieap dpening rates, began td> caiise anxicty. Tliis was intensified prior to ihe opening of tbe London saies, wlven holders of raw wool (wlro could not get adequate values if tbe wcol was combed or spiin) deemed it arivisable to send their raw material to tbe London saies. Consequently , alihough only 57,009 bales ot new a.rrivals were available, the total quantities amoiinted to 140,000 bales including 35,000 liales lroin coi sumiiig ccntres. This unexpeet"ed developrnent did mueli to shake cont'idence, for it iudicated that a conside.rabl© body of the trade intended. to becolne sellers rather than huyers at tbe auetions. Tlie feeling prevailed that wool values had struck a slippery slope and tlvat tli© only policy was to wait untii they lnad rcached the bottom. M oroover, if collapse was inevitahlo, consumers were naturally anxious that ,i.t should. c-ome before lieavy purchases wero mado of the new season'r- clipTt is nocessary to talce. a broad rather than. a seetion a I view of , the principal faetors . ■governing the preser.t serious position if confidence is to be restored ; for this is the primary need at the momcnt before any rovival of demand cau be expected. The whole iudustry, from the giower to the distributor of cloth. has reeeived a, great shoclc by the sud.dm change in thie market. Repo,rts from all centres indicate that, with the exeeption of ai somewhat lafgei' qirantity of tops in Continental centres, the stocks of raw material are not excessivie. The chief trcuble has not been entirely a price diflicul ty . although it mujst be realised that the .raw material has been too higli. for prodticers to ma ko protits. Wool i s not the only eommcdily that is suffering: cotton, artificial silk, and jute have all shown sqine decline, Manv hasio industr.ies are iinding similar straifi and depressdon. The heavy trades, coal and the nailways are all seeking some economie relief and the woollort iudustry is suffering. seyerely from the lack of huying power in tlie f fome trade been use of these go ii ora 1 depressions .