Doubtful Outlook For N.Z. Wool In Japan

Press, Volume C, Issue 29523, 26 May 1961, Page 19

Doubtful Outlook For N.Z. Wool In Japan

(By R. E. BLAZEY, Tokyo Correspondent of “The Press 'l

TOKYO, May 18.

Australian wool exporters may sever their links with New Zealand and South African partners in the International Wool Secretariat and go all out to save Far Eastern and European markets for wool from the menace of synthetics.

Although no decision hat yet been reached by the Australian Government and its Wool Bureau, I learned during a visit to Australia earlier this year and since returning to study the situation in Japan, that the Australians are dissatisfied with the work of the International Wool Secretariat, especially with the failure in North America, and feel that a fresh start must be made to save wool from the fate of silk—becoming a secondary fibre with only a limited market. Mr R. G. Lund, a New Zealander who is now chairman of the International Wool Secretariat, and Mr T. F. Hurly, a South African member of the Secretariat, passed through Tokyo on their way to Melbourne to attend the first meeting of the Secretariat under its new constitution which gives Australia majority control, with seven votes out of 13, and abolishes equal representation by countries. Mr Lund expressed some concern at the criticism of the Secretariat and told me that “wool must be promoted as wool” and that division of resources would only weaken its case. High Tariff

Mr Hurly concurred and pointed out that the loss of the major part of the wool market in North America to synthetics was more due to a crippling tariff of 25 cents per lb on wool than to lack of effective promotion. So far the position in Japan, Australia’s biggest market at the moment, is

sound but synthetics are advancing steadily and pose a real problem for the future. Messrs Lund and Hurley, with the aid of the permanent director of the I.W.S. in Japan, Mr J. L. Alloway (also a New Zealander), made a study of the Japanese market before leaving for Melbourne last week and will be presenting the case for the Secretariat at the meeting in the latter part of May. Japan took 1,412.000 bales of wool from Australia, New Zealand. Argentina and South Africa last year. Of this total 8 per cent, or more came from Australia; New Zealand supplied 80,000 bales, South Africa 40.000 and Argentina 80.000 bales. South Africa supplies mostly Merino wool similar to Australia's, while New Zealand and Argentina shared the market for cross-

bred, which goes mostly into carpets, felt and knitwear goods.

Australia’s vital interest in Japan is demonstrated by the latest figures released by Canberra showing that Japan took £73,970,000 in wool—a quarter of the total Australian clip—from Australia in financial 1959-60, whereas the United Kingdom bought only £54.690,000.

Thanks to the Japanese preference for woollen garments and the inefficiency of the synthetic fibre industry, Japan may buy even more this year and next. F. Kanematsu and Company, one of the largest buyers, estimated Japanese spinners would increase purchases from about 1.500.000 bales in 1960 to 1,600,000 or more in 1961. Synthetics ■

The position vis-a-vis synthetics is equally encouraging. According to “Wool," the journal of the Federation of Japan Woollen Industry Associations, consumption of wool in Japan increased by 18 per cent, from 90,409 tons in 1959 to 107,109 tons in 1960.

The figures for worsteds (mainly Australian Merino) were 74,729 tons in 1959 to 92,855 tons in 1960. Consumption in other classes dropped slightly by 1426 tons from 16,680 in 1959 to 14,254 in 1960. but this was not regarded as a significant development. In comparison the demand for polyester and acrylic fibres by worsted spinners fell off from 1160 tons to 802 tons while other spinners increased consumption of synthetics from 2506 tons to 3000 tons in the same annual period.

A definite trend towards blending has emerged with Japan’s largest woollen spinner, Nihon Keori, and other big mills such as the Toyo, Toa, Nihon and Daito Spinning Companies, using up to 8 per cent, synthetics in their woollen fabrics.

This problem has become particularly acute in knitting wools, where, in spite of labels which proclaim “pure wool,” most brands contain as much as 50 per cent, synthetics. It has in fact become very difficult to buy pure knitting wools in Tokyo shops. Spindle Capacity Another encouraging aspect of the wool situation here, at least for worsteds, is that whereas idle spindle capacity in America and Europe, according to reports, has been re-tooled for synthetics Japan is maintaining 35 per cent, to 40 per cent, of its woollen spindle capacity in idleness for the day when it hopes to buy more wool. No mass change-overs have yet been reported in Japan. In spite of criticism, which mainly devolves on the “bureaucratic" nature: of the T.W.S., some successes have been scored in promoting wool in Japan. Most notable of these has been the accepttance of wool for Japanese women’s kimonos, formerly an exclusive preserve of silk and cotton.

The secretariat, under Mr Alloway's direction, launched a campaign five years ago to promote wider use of lightweight wools. One result was the advent of the cheap but serviceable and quite attractive woollen kimono for everyday wear. Its advantages over silk are that unlike silk kimonos it does not have to be un-

stitched for laundering, it resists water and stains, and it costs much less. A woollen kimono may cost as little as £3, whereas the cheapest silks start from £lO.

Today it is estimated that one-third of kimonos in use in Japan are woollen. Joint Body

The Japan Wool Spinners’ Association has been joined with the I.W.S. in Japan for the last three years in a Japan Wool Secretariat joint committee to promote wool. Mr Alloway disclosed that both parties had contributed “about a quarter million <£stg. equivalent)” last year. The policy of the secretariat has been to advertise wool and its features, including such new treatment as "Siroset” and “Siro-size” (permanent pleats and non-shrink-ing), in national daily newspapers and magazines. The secretariat’s funds in Japan and elsewhere are de-

rived from levies on the producers and subsidies provided by the individual wool bureaus and boards The levy in Australia has been 5s a bale plus Sb subsidy, which has been or is about to be raised to 10s both ways and ultimately to £l. NX Payments The New Zealand producer (according to Mr Lund) pays 64 and receives a subsidy of 8s while the South African pays a flat £1 a bale. Sir William Gunn, chairman of

the Australian Wool Bureau, has been campaigning for £3,250,000 a year from Australia for promotion, against a present £500,000. He is also reported to be one of the leading advocates of an independent Australian sales campaign abroad and was to have come to Japan earlier this month on a fact-finding mission.

Mr Lund also disclosed that the secretariat planned to set up a Far Eastern Regional office, either in Tokyo or Hong Kong, to take care of the Japanese and Chinese markets. He said that in spite of the promising nature of both markets at the moment, synthetics were a “powerful competitor” which could not be underestimated. The prices of synthetic and woollen fabrics in Japan is about the same and synthetics’ advances had not been due to the obvious reason of lower prices. Their advances have to be attributed to their merits and aggressive publicity. In the main the synthetic fibre industry in Japan is divided against itself and still has to rationalise production and improve on its dyeing techniques.

The challenge has been made, however, and the battle is on. The meeting in Melbourne will no doubt be giving high priority to Japan and the Far East and whether the Australians, who have by far the biggest stake in the area, will decide to go-it-alone or work through a rejuvenated International Wool Secretariat, which they now control, will depend on the deliberations there.

Meat Marketing One thing I have learned which may affect the issue for New Zealand is that the New Zealand Meat Producers' Board's decision last year to reject a JapaneseAustralian proposal for the joint New Zealand-Austra-

lian - Japanese (importer) marketing of mutton in Japan and to go ahead with plans to establish a New Zealand brand name will not incline the Australian Government favourably toward carrying New Zealand wool along with its own.

As a New Zealand Meat Board representative told me very candidly, in discussing what then amounted to a proposal for an organisation similar to the Wool Secretariat in mutton, "in wool we (New Zealand), gain from them, but in meat we have the lead and prefer to keep our secrets to ourselves.”

New Zealand has since done very well with mutton in Japan and is currenly spending £lOOO a month on publicity. Then again South Africa's withdrawal from the Commonwealth and the fact that some Asian nations, such as Malaya, are boycotting South African trade will not be a factor In favour of South African interests in the Wool Secretariat. Whatever happens. the position for New Zealand crossbred wool in Japan is not going to be easy. The Japanese prejudice for pure wool suits (and kimonos) will help Merino, but nobody cares very much what goes into carpets and felts, as long as the product is durable. Prices and political considerations, such as New Zealand’s continuing import restrictions, will be the determining factors in whether Japan buys more or less wool from New Zealand in the future.