THE WOOL TRADE

Ashburton Guardian, Volume XLVI, Issue 10415, 5 June 1925, Page 6

THE WOOL TRADE

AMERICAN CONDITIONS. AUSTRALIAN INVESTIGATION. (Per Press Association—Copyright.) NEW YORK, Juno o. The Australian Trade Commissioner, Mr J. A. M. Elder, has concluded his investigation of the wool trade. He declares that undue emphasis still is being given to the recent high prices of Australian wool in an attempt to justify the unsatisfactory condition of the manufacturing business in the United States. . Mr Eider is still mere convinced that this has little or nothing to do with the situation, the causes of which are almost, entirely local. He finds that wool passes through a great many hands on its way from raw conditions to a suit of clothes, each middleman requiring a profit which materially increases the cost, particularly a>s "pyramiding" now is excessive and out oi proportion to the original profits made, it is a rare thing to discover a retailer engaged in all operations, but a beginning now has been made in that direction. Moreover, in the average suit of clothes, Australian merino forms only a part, the balance of tho cloth being made up of other Australian or foreign wools, American domestic wool, rafs, etc. Very few worsteds are made mainly of Australian merino. These at present are cut of fashion because they do not lend themselves to manipulation of this character in the same nay as so-called woollens. When worsteds are re-established m public favour there will be a heavier demand for wool. The proportion oi v.-00l in some suits now is relatively small as the substitution of re-worked wools from rags, etc., is done to a considerable extent and is growing, such growth being stimulated by tile higher wool prices. The practice of using tailors' clippings in cloth tends to limit wool consumption and it is anticipated that the present heavy demand for re-worked wool will continue. Another factor in the situation is that for many years the retail trade has purchased its potential requirements a long time ahead, but the practice is entirely different since the bad slump in 1922. The retailer is not now prepared to anticipate the public • demand to anything like the same ex'tenrf: and prefers to cater for that dejin (! when it arrives. These altered J c •nditioui. seriously affect the manuliittiuer, who no longer has an everj vadv market, and therefore is unwil,ir. ;•■ to accumulate stocks. .

•vir Elder anticipates changes in eh;thing trade methods in the immediate future. He expects there will be some more direct dealing between retailer and manufacturer. He also expects the manufacturer will assume larger risks, financially and otherwise. Mills will eventually co-operate and adopt a collective method of carrying this new burden. Summing up the situation, Mr Elder says he feels that, though unsatisfactory, it is. only a phase through which business is passing. The country is prosperous and wages are more likely to increase than decrease, bringing added prosperity. Concentration in one hand of various manufacturing processes and more direct dealing will greatly reduce costs and have a beneiicial effect upon the Australian wool situation.