Ashburton Guardian Magna est Veritas et Prævalebit WEDNESDAY, JANUARY 12, 1949. THE WORLD MARKET

Ashburton Guardian, Volume 69, Issue 78, 12 January 1949, Page 2

Ashburton Guardian Magna est Veritas et Prævalebit WEDNESDAY, JANUARY 12, 1949. THE WORLD MARKET

The Dominion record price obtained at the wool sale at Timaru yesterday, fabulous as it would .have .been considered only a few seasons ago, is in keeping with the trend at all centres of the wool trade throughout the world. The explanation for this trend is that demand and supply are not yet balanced. The demand factor is many-sided. In the first place, it has taken and. is still taking much more wool than was originally estimated to re-clothe Europe and Asia, to replace household furnishings, to restock wardrobes which, in more sheltered lands, had to “make do” while production was diverted to the needs of war. In the second place there is the present unsettled state of international politics, which is clearly encouraging the accumulation of strategic stockpiles of wool over and above a high level of civilian consumption. In the third place there is a lack of serious competition from other textiles; dear as wool is to-day, its rate of increase in price has not equalled that of cotton, while the threat of artificial fibre's has been partially overcome by intensive scientific research into the qualiies and uses of wool. The supply factor is' likewise subject to a wide variety of influences. Not the Least important —-although one of the least recognised—is the decline in the production of raw wool actually within Great Britain. The figure has fallen from 114,000,0001 b in 1941 to an estimate of 75,000,000 this year. In terms of sheep population, the decline has been from 30,000,000 head to somewhere around 18,000,000. A similar influence has been apparent in the United States, where the 1949 clip is expected to be the smallest for many years. South Africa's Merino flocks have been somewhat cle-. pleted recently, and even in’Australia the urge toward greater exports has tended to produce an increase in the crossbred clip at the expense of finer wools. According to an informed American estimate, the world’s production in 1948-49 may be 800,000,0001 b less than the anticipated consumption for. the year. It would be foolish, however, to expect a tong continuance of the current prices, for nothing in the wool market is permanent, least of all high prices. If the value of cotton, for instance, proved unsteady the present rates for wool might prove dangerously high. The one undeniable aspect is that the New Zealand producer is now reaping a lucrative return to place against high costs.