ENGLISH WOOL TRADE.

Press, Volume LXVI, Issue 19854, 15 February 1930, Page 10

ENGLISH WOOL TRADE.

THE DEPRESSED MARKET.

iSi'ECIALLI WRITTEN FOR THE PRESS.) BRADFORD, January 2. Another year has opened. with the wool trade in no very great form. This is said without any desire to describe things as being in the slightest degree worse than fits the facts. Whatever happens when the sales are resumed in Australia next Monday, there cannot be such an advance in values as is really satisfactory to Australian pastoralista. The statements made in the cable and mail information clearly indicate that serious concern is felt in growing and selling circles regarding current and future values for wool. There is no wonder at various suggestions being made and enquiries being put forward as to what is the real cause of the slump, but I say quite advisedly that, institute whatever enquiry it will, the Australian Parliament can do nothing to lift values to a better level. It is purely an economic question belonging solely to the industry itself, and does not come within the sphere of legislation or external control. If wool were the only raw material used in the West Riding of Yorkshire, its market value would bo very much greater, but substitutes have made very serious' inroads. The object for which they were originally introduced may not have been completely achieved, for they cannot now be regurded solely as a cheapening element. Unfortunately for wool, however, they have found a place of their own, and are likely to hold it as long as clothing is wanted for the human race.

Too Little Machinery Bunning. It has been necessary from time to time (luring the past twelve months to refer to the fact that 30 per cent, of the machinery in the woollen and worsted industry of England has been standing. It is obvious that if all this I machinery were running every day, and I wool was the raw material absorbed, a very different tale would have to be told. The botany hose trade has disappeared, this being a very serious matter for West Riding spinners and hosiery manufacturers. If this trade could be recovered, an increased absorption of wool would be assured. This loss is the chief cause for the low prices ruling, and restriction of wool offerings in Australia will not provide a real remedy. It may help to maintain prices for the time being, and there is no doubt that the 33 per cent, reduction of offerings in the first half of the season prevented prices falling further. The thing which sticks in the minds of users, liowewer, is that any wool held back is no use to anybody. Indeed, the longer it is kept the greater the loss. If sellers in Australia decide to carry the burden, they are losing interest on the stock laid dead, and the same thing would happen to importers if they decided to_ take the risk of buying. Since 1925 the losses incurred by the latter have been too big for them to care." but to buy again on extensive speculative lines. Having thus presented the case I am. at a loss to suggest anything for the benefit of either section of the industry. Several prominent members of the trade here are very anxious that| growers should receive profitable prices lor their wool, yet they fail to see that it is the right thing to curtail' offerings. It is realised that at present J prices wool is not profitable for the growers. A higher level is admittedly desirable, but the only means for bringing it about is an increase ot manufacturing requirements in every manfacturing country in the world. write primarily for the West Riding of Yorkshire, out know that what is true here is equally truft in France, Germany, and elsewhere. Possible Outlets for Wool.

In their annual report Schwartzje, Buchanan and Co. state that although there has been a sensible reduction at the Continental combing establishments aud conditioning houses, stocks of tops are 25 per cent, abovie normal. From this it is obvious that consumption has not been good, this being a confirmation of what has been stated above. The country with the greatest possibilities for absorbing; wool and its products is Russia. If trade could be done with that country in the normal way raw material values would be saved. Wool, tops and yams, as well as fully manufactured goods, could sold in big quantities, and the West Riding industry would be more prosperous, even if it had to share the trade with France aijd Germany. Unfortunately, financial facilities are restricted and unsatisfactory. Only very few firms in _ this country dare "risk trade with Russia at all. Having to take four to six months* bills is too costly and risky for the majority. The Soviet Government continues to install new machinery, apparently realising the necessity for bringing mills up to date, but the financial resources are far too limited to enable big quantities of wool or anything else to be imported. If Russia were taking raw material in Australian markets in anything like the quantity needed to supply the population with decent and adequate clothing, there would be no trouble at all about any surplus wool or any curtailment of offering!.

Stock Exchange Slumps. Another factor which has operated adversely upon the trade is the serious slump during the past three months in the Stock Exchanges.- Very little has been said about this in previous letters, partly because it has not been strictly gerniain to the wool trade, and partly because there has been quite enough of a depressing nature to write about without mentioning that. The trade has had its internal losses which would have had to be faced whatever had happened in the Stock Exchanges. The proposed heavy increases in expenditure by the British Government will also lead to higher taxation in the next Budget, and this will make it all the more difficult to carry on industry. Some relief has been given by the reduction in the rating of manufacturing establishments, but those in the industry know that what is being put into one hand is being taken from the other. It is doubtful whether much actual, saving is resulting from the local de-rat-ing. More attention is being paid to these things by reason of the fact that spinners and manufacturers are very hard put to it to buy and sell at a profit. This is one of the main points about the wool textile industry. Efficient machinery and up-to-date organisation undoubtedly contribute something to superiority of output, and maximum production at a minimum of cost, but; all this is futile unless a spinner can sell his yarn at a right price, and then 2 et tops at such cost as will leave him a reasonable working margin.. . j