RESERVE WOOL PRICE

Press, Volume LXXXIV, Issue 25537, 3 July 1948, Page 8

RESERVE WOOL PRICE

: NOTHING EXTRA FOR GROWERS DEMAND FOR HALFBREDS AND MERINOS (P.AJ WELLINGTON. July 2. Higher reserve prices for wool in the coming season will not mean that growers will receive any more for Uieir wool than they did last year. The reserve or “floor” price is the price at which the Joint Organisation buys wodl if no satisfactory bid is forthcoming from a commercial buyer. An increased demand for Merinos and halfbreds recently has widened con siderably the gap between the reserve and market values, and it is to narrow this gap that increases have been made in the floor price of these types of wool. As 80 per cent of New Zealand wools are crossbred there will be no alteration in their reserve prices These points were made to-day by Mr H. J. Wardell, acting-chairman ol the New Zealand Wool Boa”d. in a statement commenting on an announcement on reserve prices by the Minister of Marketing (Mr E. L. Cullen) The Minister said that from August 30 this year the average overall increase in the reserve level as compared with last season’s average would be approximately 20 per cent, in Australia, 18 per cent, in South Africa and 4 per cent jn New Zea land. “Growers should clearly under stand,” said Mr Wardell, “that this announcement does not mean an increase in their returns in the 1948 49 season, but represents a readjustment on reserve prices to bring them more into line with the market demand. These reserve '’rices were originally based on the war commandeer schedules which were then in favour of crossbred qualities The market has now moved in favour of fine wools, which accounts for the greater increase in the new reserve prices for Australia and South Africa Only 20 per cent of the New Zealand clip will be affected y this a’tera tion. and unless we have a serious recession in wool values the new reserves will make no difference in returns received by growers “This announcement may cause some confusion in the minds of the general public, who. because of the publicity given tc extreme prices paid at auction for a few bales of our super wools, have got an erroneous idea that woolgrowers over the last season were receiving very high averages. As a matter of fact wool values were not out of line with other world com modifies. and are much on a par with butter and meat Final figures are not yet available, but 80 per cent, o; our I wools last season netted growers about | 20d per lb. a low enough average j when all circumstances are taken into 1 consideration.” 1 1