THE WOOL MARKET.

Taranaki Daily News, 21 January 1921, Page 8

THE WOOL MARKET.

POSITION IN BRITAIN. CONGESTION IN STORES. POINTS FOR CONSIDERATION. London, Jan. 2. I For the Government sales of colonial wool from ovember 8 to 16, inclusive, 505,616 bales from New Zealand, were catalogued, and offerings from Australia totalled more than double this quantity. In addition, some 190,493 bales were placed before buyers for sale “on description,” but with the changed conditions obtaining during the last few months this method of disposal has been dropped. Messrs > Gilbert, Anderson and Co. describe the figures given as “pretty formidable,” but unfortunately a large proportion of the offerings were not sold, withdrawals being most marked of late, despite the smaller catalogues submitted. Reviewing the chief features of the successive series of wool sales, the company recalls the high prices realised during November and December, 1919, and for the first two months of 1920, and says that some of these will hold the record for many years to come. The better descriptions of wool have been in most demand, and this is maintained. In February an easier feeling became- noticeable in respect to crossbreds, and since then,. although fine and medium qualities nave more or less held their own, coarse sorts have become more and more neglected as time has gone on. Since April prices have declined all round, until of late business has become very difficult indeed, the operations of many buyers being cheeked by the hardening of money rates and the irregularity of the Continental exchanges. This latter circumstance is probably more responsible than anything eke for the large cancelling of orders that took place some two or three months back, and for the uncertainty that prevails all round as to the future. UNCERTAINTY OF THE FUTURE.

Tn the meantime, with only the better classes of wool being absorbed, and these not nearly so fast as could be desired, stocks have accumulated in warehouses here to the extent of over one ; million bales, the bulk of which are low j crossbreds, for which there is at pres- i ent an entire absence of demand. All i this must be very disconcerting, to those ; in the Dominion, who have to decide on their future operations. The situation has been aptly summed up in a few words to the effect that the only thing certain in regard to the future is its uncertainty. The outlook for private-ly-owned wool ‘ . anything but promising. Warehouse £pace has already been stretched to its utmost limits to accommodate stocks. In consequence there is a likelihood that shipments to arrive will be diverted to other ports than London, and although efforts are being made to | make arrangemi ; t for the disposal of i arrivals along with Government-owned | stocks, it is difficult to see how this can ‘ be of such a ure as to allow of consignments being cleared promptly. GERMANY HUNGRY FOR WOOL. This being so, the point to be seriously considered is:—Are shippers prepared to allow their consignments to remain in store for possibly twelve months or more, which would mean that purchases at a very low price wot Id more likely than not result in losses owing to the enormous chatges that would accrue for storage and interest? In such circumstance there would be a large amount of capital locked up, which is not at all desirable under present, condition;, of the money market, combined with the attitude bankers have been forced to adopt in regard to advances against commodities not readily realisable. On the other hand Germany is very hungry for wool, but owing to her financial position, and the fact that as yet no arrangements appear to bo possible to overcome the difficulty, the risk of granting her credit is considered too great by ’i/siness firms. In consequence no help i can be expected from this direction until ; some international agreement is arrived at in regard to finance. It would appear'therefore, that everything is against consignments of ‘“free’’ wools being made to this country, and doubtless if buyers from America and Japan show the expected inclination to operate in New Zealand, settlors will avail themselves of the opportunity to dispose of their wool accordingly.