RESALE OF WOOL

Wairarapa Times-Age, 3 April 1940, Page 9

RESALE OF WOOL

AMERICAN REQUIREMENTS. RECORD LOW LEVEL OF STOCKS. Strong criticism lias been levelled in Australia and also in various quarters in England at the slowness with which the wool control in England is meeting the American demand for wool, and the risk that this policy may have on its future use. Even in the last few days, a new substitute has appeared which, it is claimed, possesses virtues unknown in other substitutes. In the meantime, a copy of the January issue of the “National Woolgrower,” the official publication of the industry in the States, just to hand, remarked that "the stocks of domestic wool in the hands of dealers, growers, and co-operatives on January 1, 1940, are by far the smallest on record. It is moare difficult to accurately estimate the stocks of wool in the hands of manufacturers, which are admittedly far less than normal for this time of year."

The American paper proceeds to say that the British Government (some time ago) announced that the Control Board would release 75,000 bales at quoted prices for the various qualities of skirted wool from Australia for American use. This indicated that the Australian wool would cost from 90 cents to one dollar clean landed New England mills, duty ’ paid, or slightly under September domestic wool values. This release, however, has not to date afforded the relief anticipated and, notwithstanding liberal importations of fine wool from South Africa, a squeeze on fine wool before the 1940 shearing season is yet possible.

To make the situation more complipated (continues the paper) the English Government has commandeered all of the shipping facilities of England and her colonies, with the exception of Canada. It is uncertain to what extent shipping facilities will be available for Australian wool. The insurance companies have raised their rates; all of which has added to the difficulty of those seeking to acquire their usual amount of Australian wool. The best authorities estimate that no more than 15.000 bales of the allotted 75,000 have been the subject of negotiation to date.

There is an entirely different picture, however, in the case of the Cape wool from South Africa. Deliveries of this wool are being made in Boston in considerable volume, and supporters of the domestic wool have been forced to recognise this class of wool to be superior in quality to American domestic fibre. America has never been a large user of South African wool, but it is quite certain that 100,000 bales have already been purchased in South Africa. Large importations are also arriving from South America. A total of 46,500 bales, or about 46,000,0001 b, was shipped from Argentina to the United States from October 1, 1939, to December 31, 1939. as compared with 24,767 bales in a like period one year ago, and 1681 bales in a similar period two years ago. The restricted release of wool for overseas use may have some reason not apparent to wool men in this end of the globe, but it is a matter of direct interest .to woolgrowers. America wants the merino and halfbred wool of Australia and New Zealand — she is securing all the coarse wool she requires from the Argentine—and in view of the fact that the woolgrower here is entitled to half the profits on the resale of his wool it is disturbing to realise that whilst South Africa can supply 100,000 bales of fine wool, Australia and New Zealand between them have supplied only 15.000 bales. While the British Government may have strong reasons for its policy, there is no apparent reason for withholding the announcement in New Zealand as to how the half-profit is to be basedon the country’s clip as a whole, or on the actual class of wool sold overseas, which is much more costly to produce than the wool that America can get in quantity from the Argentine and other South American countries.