PRODUCTION OF WOOL

Press, Volume LXXXVII, Issue 26395, 13 April 1951, Page 8

PRODUCTION OF WOOL

NEED FOR INCREASE SEEN ADDRESS BY DR. I. W. WESTON “Inflation is a bit like drink; it is very nice while it is going on, but it is very hard to knock off,” said Dr. I. W. Weston, lecturer in economics at Canterbury Agricultural College, Lincoln, in an address on wool price fluctuations to the Christchurch branch of the Economic Society of Australia and New Zealand last evening. Dr. Weston traced the connexion between wool prices and New Zealand’s general economy, and emphasised that more wool production was needed. His address was illustrated by h graph in which New Zealand average wool prices since 1872 were shown. The price in that year was Is 5Jd per lb; between 1891 and 1901 it was 4£d; in 1925 it was 2s; in 1931-33, 4d to sd; m 1946-47, Is 6Jd; in 1949-50, 3s 2d; and in 1950-51, 8s Bd. Dr. Weston set the possible peak price in 1951 at £l. Wars had been won and lost through wool, Dr. Weston said. That had been exemplified in the advances of Napoleon and Hitler to Moscow, and their subsequent retreats. In the last war British triumphs in the Middle East and Italy had been won by men fighting with one hand while the other hand was spinning wool for sale to the United States for armaments. Wool was bought most when people had money and in wars.

“The New Zealand Government could get £50,000,000 from wool in the 1950-51 season," Dr. Weston said. “We are not shipping the wool. The thing is so silly it is fantastic.” One of the reasons for the present huge prices for wool was that there were too fev producing and too many consuming, Dr. Weston said. Wool production had teen increased, but mostly on the good land, and by not producing so much of other things, Canterbury had practically become an importer of some things, including butter. There had been a Royal Commission on the sheep industry to inquire why so much land had gone out of production and to make recommendations to remedy that loss. Dr. Weston said. Since the war there had been overemployment, and a diversion of people to working on things which were not quite so necessary. “I do not know how you will get people back to essential work," Dr. Weston said. “I do not think it can be done. Personally, I think inflation will go on and on.” Soil erosion, and burning and overstocking, were other problems that would have to be remedied if the necessary increase in production was to be achieved. Dr. Weston said.

New Zealand labour could be put to better use if food products were sold and all the things that could be Laported were imported, rather than produced by competitive industry in the Dominion, Dr. Weston said. The sooner inflation was recognised, the better. Wages should be raised in necessary jobs, and unnecessary jobs done away with. Then the country would get ahead of inflation. Farmers’ businesses should be treated exactly as companies, Dr. Weston said. Plant necessary for the working of a farm should not be taxed while it remained in the business. For the sake of the farms—not the farmers—the carrot of easier taxation should be dangled before the farmers. Working capital should be left in the farms while the farmers were willing to work, to increase production, and to imnrove thmr properties. Dr. Weston said he d ; d not think the present high wool prices would last. Wool depended on world trade, and it had to compete with artificial fibre. Stock-piling was one of the other reasons for the present boom in nrices. There was a need for some organisation to feed the wool on to the market, as suggested by several United Nations organisations. Otherwise, when the reverse of stock-piling occurred, there would be no market to meet. One of the main reasons for stock-piling seemed to be to prevent Russia from buying. The solution, in his opinion, was the ultimate introduction of internat'onal law to prevent such practices.