Greater Demand For Wool?

Press, Volume CIII, Issue 30481, 1 July 1964, Page 1

Greater Demand For Wool?

Widespread growth expected in industrial countries gives fair hope of an increased demand for wool textiles, according to Dr. F. J. Mayer-Gunthof, chairman . of the statistics committee of the International Wool Textile Organisation.

Dr. Mayer-Gunthof’s view, given to the recent annual conference of the organisation in Berlin, was quoted in Christchurch yesterday by the chairman of the Wool Board (Mr J. Acland), when he returned from meetings in London, the United States, and Berlin, which . included the conference of the organisation. Mr Acland said that Dr. Mayer-Gunthof had been cautious about the likely trend of prices. On this subject Dr. Mayer-Gunthof had commented, “Who can say?” But he had added, “By all accounts now, as over the last few months, activity in the wool textile, industry remains high and stocks of raw wool are low. But short-term fluctuations in a volatile market may well be a reflection of psychological factors rather than of the purely statistical position.”

Giving the opinion that well-sustained rates of growth in • economic activity and world trade through 1964 and into 1965 were likely, Dr. Mayer-Gunthof had said that, after tax cuts, continued strong expansion in the United States now seemed assured, and the full impact of the tax cuts would be felt well into 1965. The expected rate of growth in the United States economy in the next year could well exceed 5 per cent, compared with some 4 per cent in 1963. In both the European Economic Community and in the ■Free Trade Area current rates of growth were likely to be maintained through 1964, and probably into the first quarter of 1965. The general rise in the rate of activity might be modified, however, in some of the Common Market countries—particularly Italy—by attempts to .remedy the bal-ance-pf-trade position. In Japan the rise of 6 to 8 per cent might well continue, though a worsening balance of payments could prove a problem. In the United Kingdom steady growth at a rate of more than 4 per cent should be maintained. New Zealand Prices

Mr Acland said that New Zealand growers were fortunate that they had sold most of their clip before the major

decline in prices. He was not referring particularly to second-shear wools, which had dropped 20 per cent from the highest point of the season. Since the disposal of most of the New Zealand clip there had been a decline of 10 per cent in wool values generally after the sharp Australian fall of 20 per cent from the peak of the season. Naturally there was still uncertainty about the market, Mr Acland said, but it seemed that the average price next season would be slightly lower than the 55d for the season now ending. , Marketing Discussed

Mr Acland said that the marketing of wool was raised at the Wool. Textile Organisation conference, as the Australian committee which had been investigating marketing had had discussions with the textile industry in the Northern Hemisphere. It was expected that the findings of this inquiry would be presented to the Australian Wool Industry Conference .on July 16. The conference would decide - what was to be done, and if .a major change-, was contemplated it was possible that it would be referred to a ballot- of growers. The chairman of the Australian Wool Board (Sir William Gunn) had said that the report would be made ayailable, after presentation, to the. Wool Textile Organisa-

tion and the New Zealand Wool Board. He had also given an assurance that no significant changes in marketing procedures, if they were contemplated, would be made before July 1, 1965. Speaking to the Berlin conference about views on wool marketing held by farmer groups in Australia, Sir William Gunn had said that unless difficulties involved in the marketing system were overcome, Australian farmers might find wheatgrowing more attractive than wool growing.

Floor-price Schemes Mr Acland said, however, that representatives at the meetipg from the Continent, the United Kingdom,, the United States, and Japan had expressed confidence in the floor-price schemes operated in New Zealand and South Africa and in the auction system. In, a paper to the conference Mr. Acland said that Mr F. S. Arthur, the London representative of the Wool Commission,'had pointed out that in the six seasons of relatively low prices up to 1962-63 the commission’s floor price of 33d. offered the • marketprotection to ’ an average of 80 per cent. of the realised price. Mr Acland said that this tended to place rather more importance dn the protective effect of the floorprice scheme than was generally accorded to it.