The Future of the Wool Industry. (From the New Zealand Farmer.)

Te Aroha News, Volume VII, Issue 402, 14 September 1889, Page 6

The Future of the Wool Industry. (From th e New Zealand Farmer.)

Impervkotly considered conclusions regarding the future of any leading, industry,, if made public! are nearly certain ,to -prove, misleading .to some extent, consequently, any attempt to forecast" future values of wool involves' consideration of the circum-! Btances which, of late years operated ,to de-: press the value of the staple, and tho altered' conditions which' have but very recently served to enhance values. A retrospect of' wool averages (Cape and Australasian wools combined?, since 1872 appeared in an article 1 contribubed by Messrs Helmutb Schwartze and Co.* to the Economist's ."Commercial' History and Review for 1888," from whi6h , we extract tho following :—: —

The importations into Europe ' and America of Australasian and ' Cape wools were as under in the years stated :—

Had prices in 1888 been on a par wifch those of 1872, the .Australasian wools imported into Europe and America would .have realised £34,847,00G instead of '£17,752,000. With the exception of the better prices realised in 1880-1-2, values of wool declined as production increased, bub the low standard of wool has enormously increased the; demand for and wear of woollen , manufactures among the world's population, and at length supplies of the raw material, enormous though they be, are barely adequate to meet requirements. In reference to the low prices of 1888, Messrs Helmuth, Schwartze and Co. say : " The average value per bale of £13 10s for the past year is as low as the lowest on record ; but, viewed in conjunction with an increase in three years of 25 per cent, in the production, the absence of a fall in values is a favourable factor, and testifies to considerable strength in the position of the arbiolo." The often -expressed fears of overproduction have thus been satisfactorily dispelled, as this year's transactions in the London market show. With a gradual rise in values, there were only left over at the termination of the first of the series of sales in February, 12,000 bales out of 248,000 bales catalogued ; whilst at those which terminated , on the 4fch of . May, out of 311,122 bale 3 offered only 5,000 bales were held over, and at the sales .just closed, the third of tho serieo, only 8,000 bales have been carried over for the September sales. In closing their review of transactions in 1888, Messrs Scwhartze and Co. say : " The past year has shown that at the existing range of prices, the industry is fully able to cope with the supplies, but it has also taught) that with any appreciable rise in values the demand is apt to drop off. The position of the trade, in fact, ia strong within the limits of present values, but not beyond. We see no reason to expect a change in these conditions during the current year (1889)." Unforeseen changes and circumstances "have occurred before, and again distinctly so, this, year, which have confuted the propitious utterance of brokers and manufacturers. Compared with the earlier, the higher prices realised at the later sales in both 1887 and 18S8 showed' that manufacturers .had eitheroverestimated supplies or under-estimated requirements. So, again this year ; contrary to anticipation, there was eager competition and a well-sustained advance during the first and second series. In reference to figures given in their repoifc issued just before the close . of the second sales this season, Messrs Charles Balme and Co. say : " The larger scale of consumption recently reported as „ existing in both home, and foreign industries is plainly evidenced by these figures, which show, an increased absorption of about 4 per cent, in, quantity, at a range of value now varying from 10 to 15 per cent, in advance of that at the same date ofthe previous year." At the second series of sales, which closea on the 4th May, opening prices showed an advance of on February rates, and towards the close became ald to Kd dearer. ,The sales just closed show a further advance, particulars of which were cabled on 16th of July to the New Zealand Loan and Mci can tile Agency Company's branches here. Details are :—: — Superior greasy has advanced £d per lb ; combing, washed, *d to Id perlb ; clothing, washed, M per lb ; scoured, Id to Ud per lb ; fine greasy crossbred) Id per lb ; fine washed crossbred, Id per lb ; fane scoured crossbred, Id per lb,— since close of last sales. Hereunder the prices current at the Aprii-May sales, extracted from Messrs Buxton, Ronald and Co.'s circular, are stated in order that wool-growers may fully comprehend the scope of the further advance :—: —

1 THe* 1 Various and varying circumstances which in ! i'BBB affected values of V^ppJ 'during the year's 1 'series M o'f sale's,, may again show; thereforean'putSlin'e of the'se^influences, and, th|eir' influence on 1 transactions will 'fc'oiwoolgrbwers'th'e causes f of_ the depression! in!pric'6B in! bhe'^arly part of theseasfln,' ahd[ 'of \ tH&sh'atfjg ».a'ri^,u h'expecte'4 ! .revival; at two later sales. ' The reviews 'of the year's ] '.Business hi: Jbno 'issued; by. the j several JDondpn wpol-brok'ers,] are in ; ajrreemen'ti^as.,to'"'^^/^erojljing 1 , causes^ for the 'depression, and* subsequent 'advance, in valaes. Buxtony RonaW an^ Co. make tho^

following subdivision of bhe year's operations :— i " * ' ' ' January to June .. .. Supply depression 5 . July to September .. .. Trade uneasiness. October to December .. Free markets and !, , , strong tone. In regard to the first named, ifc is stated n the circular,:—" Periodical hesitancy and luggishness have become such stereotyped haracteristicß here in spring as to excite ittle attention and less surprise. The onsequence partly of reaction from he ' tirst of the' new season's, purih'ases ib is naturally most pronounced rfaen the' results' are disappointing,' but it 8 also greatly fostered' by vague and ex-, ravagant notions respecting 'annual inc're-> nent in the production of the staple. In ■egard to the latter, if the experience did, »obhing else, ifc ceroairily exposed the fallacy if the ideabt productioirhavingpermanently, iverreached consumption.' In this as in, )ther matters, foregone 'conclusions are too| sasily allowed to usurp the domain of reason and mitigating circumstances are lost; :o view. 'All reliable from Australia, had ;oncurred in representing the increase' in the 1887-8 clip as considerable, but' is early as the month ' of ' March (1888) the extent o the surplus was not only' clearly perceived here, but attentionwas drawn to the 'fact, that it had for the, [host part been' received and dealt with." At the time trade offered us encouragement, and in addition other issues existed which had their influence, and a potent one was bhat the sustained polibyof thepreyiousyear (1887) had been inimical to the accumulation Of stocks. " But in the early period of 1888, the more rapid transmission and concentration of the Australian clipoverashorter period of the year was not sufficiently borne in mind, and the consequence was the dread on the part of manufacturers of being caught with stock, led in many instances to being found without stock." With the advent of summer a revival in trade was anticipated, bub summer weather was'unfavourable, and the depression in wool values reached its climax in last August, while throughout, the preceding sales anxiety as to the probabilities of war and European disturbances had a severely depressing influence, and conduced to the inertia in the marked which prevailed. Then followed the heavy failures in Yorkshire in September, which added *o the disturbing causes, and as the circular already quoted from states:— "At first blush, the news of these failures, falling like a thunderbolt on the eve of a series of auctions hei'e, was rc.garded as a public calamity, but under the circumstances, nothing, if it thust happen, could have occurred more opportunely. The consternation was short-lived ; not only was the pulse of the market felt in the quickest manner, bub ib conduced to the more rapid circulation of confidence throughout the trade. It was a transformation from more existence into active life." In the circular under notice the following table is given, showing the comparative imports of New Zealand , wool into Greab Britain during the seasons 1886-7 and 1887-8.

The totals from all ports were in 1887, 164,57£ bales compared with 157,972 bales in 1888. In reference to New Zealand shipments of wool for British markets Messrs Buxton, Ronald and Co. say: "The development of steamer traffic fiom New Zealand is a factor of considerable importance, particularly in respect of possible arrivals in February and March. It is material that a fair quantity of North Island crossbreds should come to a bare market in advance of the domestic clip, while it is desirable to I obviate, in a general sense, an enormous accumulation of shipments from this colony in June and July." It must be here noted, in connection with these suggestions, that it was recently proposed that in future the Australian sales shall open for the season in futuro on let September instead of a month or six weeks later as has been customary. Should the proposition find acceptance, the bulk of desirable Australian wools will be sold or shipped by a much, earlier date than in past years, and thus home and foreign buyers will be enabled to give more attention to the sales in this colony.

It is remarked in the circular that "crossbred wools fluctuated less than Merino, fine grades'in particular being well upheld for both scoured^ and greasy descriptions.' The < maintenance of' crossbred) flocks at a liigh pitch of' excellence, either \n Australia priNewZoaland, is 'fraught with difficulty, "and >> for* this 'very reason, 1 well bred and' well assorteclparcels are 'generally certain of' keen competition." . ' , ' *' ," '_.'" In: con eluding 1 their review' of the wool f trade of 1888, Messrs Buxtori Eonald and Co. express themselves in regard to fih'& business during n ' J the current seaspn. ,Thoy'say>: M ln v ventuPingto form some apprpximatelycorrectopinion'.respecting the Varly course of this market (London) depen-

denceupon a few.considerations will probably ' afford'tn^ safest ground, i The experience of - the past year hasproved twbthings. '• Firstly, it transpired that consumption measurements were not only equal to the capacity of . supply, but that the two questions ' now stand in very close relation the one to the other ; in othei', # words, there can be • little or no intervening old stock. Improved, in the second place, that _the, tendency of prices, after the first severe fall in February, was distinctly, though subject to'frequenb' ' .checks, in- an; upward -direction, !and f nob downwards, as was the case in the J( preceding year. If such features' may be 'construed as, latent elements ,pf strength, ' then without' doubt- prospects, I 'apart ftbm..j extraneous circumstances'/* would ''s'eetjl'' to j j point to a good and steady trade uluring" the new y'^ar." It is almost needless to say that these hopeful anticipations ha.ye' ( been. very < fully realised, and/thab bhe« j^r'esenfe position of the wool industry is so further assured by the known li^htness'qf stocks ,of raw material and manufactured 'woollen textiles in 'manufacturers' hands, as to, indicate very distinctly a still higher rarige ■ of prices for wool. ' ,

Yon?" Timaru - Dunedin. Oamaru Bales. .887 73,792 .888 I 51,079 Bales. 7,036 15,063 Bales. 54,437 52,350 Baes 16,693 ] Bluff. | Picton. I Nelson. I Bales. .887 8,725 LBBB 10,294 Bales. 3,842 3,913 Bales. 758

Nbw Zealand Merino.

MERINO.

Auckland. Gisborno Napier, Wellington. Bales. 1887 9,402 .888 6,783 Bales. 2,044 15,633 Bales. 43,521 39,043 Bales. 53,255 ' 56,329

MIDDLE ISLAND.

'' FLEECE. tJhoice, bright, freeShafty, liprht ■ Tinged, some, burrs.. « Yolky, mixed, dingy .» Wasty, burrj r "■ ; , , „ scouußD. Bulky, bright, light Fair bulk and colour Tinged, shorter, burrs Irregul ar, £ a ctr Skinny, very faulty s. d. 9. d. .. 2 2 to 2 8 -.. 19-.. 28 .. 1 7 .. 1 (U .. 1 5 .. 1 6 .. 1 2 .. 1 4 .. 11l ..'.l 114 .. 19 .. 1 10V .. 1 7 .. 1 8i .. 1 6 .. 1 6 .. 1 0 .. 1 3} , GREASY. Good breed, Jight .. r Gop'd breed, wastier Blue, rather wasty Red, shafty. burrs .... Red, wastier Wasty, burry.. .. .. 1 o .. 1 * .. 1 3 „. 1 \ .. 1 1 .. 1 " .. 0 101 .. 011 .. 0 9V .. 010 .. 0 8} .. 0 9

i , . , *'LEECE. Fair to fino {Medium Coarse .. . . 1 6 'to 1 3 .. 0 10 .. 1 8 ' 1 4 1 0 - „ > scoured. Fine Fair, ... , ... .. ... .. Coarße .. t ■ 1 ' ' '. GREASY.' < 1 7i .. 1 ,4J .. 0 11 , 1 8 1 6 1 2 Fine '■ a ' .'. .. .. .. Fair ■ ,Coars,e i% .< , „• ... .. ', .. 1 2 •.. 10.. 0 8 ... 1 2* 1 2} 0 9&

j CROSSBRED.

i 1872 — Taluc per bale £26 10 0 1873 •-„ „ „.. ... 24 5 0 1874 „ „ „ 23 6 0 1875 „ „ , 22 5 0 1876 18 16" 0 1877 18 15 0 1878 18 15 0 1879 16 10 0 1880 , „ 20 5 0 ' ■ IRBI ' . „ „ • 17 5 0 1882 ' I! \, „ •■• -17 10 0 1883 .. „ • „ J6 15 0 1884 „ „ lfa , 0 0 1885 ' „ ..'••■• 14 0 0 'S :•• •:; o # 1887 „ 14 ,0 0 . • 1888 :: „ 13 10 0

Australasian Wool.. Cape Wool 1872. Bales554,000 189,000 1888. Balcp. 1,315.000 289,000

NORTH ISLAND.

Average Scoured. Average Greasy. 1887. December Closing:. | s. d. 1 4 s. d. 0 9 1888 Ist f Opening... Soi'ies. \ Closing. .. 2nd /Opening,.'.. Series. \ Closing..'... .3rd f-Opbning. .. Series. \, Casing. . . ' 4th f Opening... Series. \ Closing.... sth ' /"Opening... , Series, i Closing.... 1 41 1 3} I 3 1 4 1 5J 1 5) 0 9' 0 9 0 81 0 9 0 91 0 9 1 6 1 51 0 Qh 0 9^ 1 7 1 61 0 10J 0 10 New Zealand Crossbred. C3IH" cd. ' at Greasy. Good. av'rge. l-bred. i-brcd. Lincoln. 1887 Closing Dec, s. d. 1 6 3. d. 1 3i ,b. d. 1 0 s. d. 0 10 s. d. 0 B.} 1888 Closing. Jan '. March. . June.... Sept Nov 1 51 1 5 1 51 1 6V 1 6" 1 3 1 2J 1 3,, 1 2 . 1 '21 1 01 0 iii "l 0J 1 oi 0 10i 0 10' 0 10 0 91 0 10* 0 8} 0 8V 0 8 0 8 0 8+