THE WOOL TRADE.

Wairarapa Age, Volume XXXI, Issue 9047, 5 February 1908, Page 3

THE WOOL TRADE.

In an article "The Times" (London) discusses the present position and future prospects of the wool market. The influences making for the increased consumption of wool (unless much affected by the decline in trade that is evidently anticipated) must, it is contended, become more intensified in the future, while there is a fair prospect of much more important trade with the East than is done at present. Authorities generally hold out no likelihood of more ample supplies to meet this increasing demand, as many formerly imporrant sources of supply tend annually to hecome smaller. A decrease in European wool clips is inevitable, the growth of population and high " farming causing a diminution in the flocks. In the German Empire there were in 1306 some 3,000,000 less sheep than in 1900, and returns from other Continental countries show a substantial falling off. The reduction in the Argentine supplies of wool from 228,000 tons in 1901 to 149,000 tons in 1906, is looked upon as of even greater significance, particularly as affecting the position of coarse wools. The sheep stocks in the Argentine do not appear to be increasing to any extent, an official return recently published giving the numbers as 77,000,000. Some increase may be expected from South Africa. The Australian clip last year was a record one, but is expected to be some 20,000 bales shorter this year on account of the drought in' New South Wales. The writer in "The Times" mentions that the policy of closer settlement in Australia and New Zealand tends towards the rearing of fewer sheep. That is not so yet in regard to New Zealand the total number of sheep in the dominion being now larger than at any previous period and the country is by no means fully stocked. In Australia many of the large estates which have been subdivided and settled are devoted to dairying, but it,is now reportvd that dairy farmers are turning their attention to raising fat lambs as being more -profitable and less laborious. "The Times" says the latest reports indicate - the certainty that the clip to be sold in 1908-1909 will show a considerable deficiency, but admits that any definite estimate of this decrease cannot be made, even by those best informed, at this date. In view of the facts above quoted, which show that the most direct faptor,tending'-to a reduction in the cost of wool—increase in supply—is lacking, "The Times", regards the increase in values of th? past yeir as the natural outcome of the ordinary course of trade. We are reminded that the collapse in the wool market of 1900 was brought about by overconfidence producing over speculation; the financial foundation on which the.stalility of the wool trade depends gave way, and a state of exceptional prosperity was succeeded by chaps. It is pointed out that the , causes that then brought about the decline of 40 pur cent, in yalues are always present in commercial life, and are likely to be encouraged by the system of wool-selling nowadays. A much greater quantity of 1 wool than t was formerly the case is placed upon the markets in London, and in the colonies'between the months of November and May, which imposes a corresponding heavy strain upon financial resources. With regard to the recent fail in wool values, the primary' cause is attributed to the financial crash in America, and the resulting dearness of money, and it is the remoteness of-- the-e factors of disturbance that encuurages the belief that Drices have reached the bo torn arid that there will be a recovery, not perhaps the immediate future, but later on this year. It is said to be univer.-allv admitted that thi trade must soon contemplate a considerable, pei haps a serious, fallins off in production, but we do not see any grounds for such a belief. Though there may, not be much increase—for the newer countries cannot on the wholedo much more than make up the gradual t'ecrease in Continental . countries—there appears to be nothing at present to warrant any important decline in wool supplies. A drought in Australia is the greatest disaster than can ever overtake wool production, but cable advices on Saturday stated that New South Wales, which was suffering most severely for want of rain, has had a splendid fall where it was most required. The easing "of the money market and the improved tone at last month's wool sales in London give encouragement to the hope expressed by the "The Times" that prices will recover towards the end of the year, so long, of course, as the state of general trade in America is not reflected in the United Kingdom.—" Christchurch Press."