Wool Stockpile May Go In Three Years

Press, Volume CVIII, Issue 31585, 24 January 1968, Page 14

Wool Stockpile May Go In Three Years

(Special Correspondent N.Z.PA.) LONDON, January 23. The huge wool stockpile accumulated in New Zealand last year is expected to be disposed of within three years, the Leader of the Opposition (Mr Kirk) was told by officials of the International Wool Secretariat today.

The managing director of the I.W.S. (Mr W. J. Vines) declared: “We have high hopes that New Zealand can dispose of its stockpile within three years on a basis that will not disturb or depress the market.”

Mr Vines and a top level group of the organisation’s executive predicted to Mr Kirk that the low prices for crossbred wools would continue for about 18 months but that at the end of this period the industry might well be In a position to stand a price rise. They believed that a continuation of the low prices, coupled with product and market development work now going on was leading to the increased demand which would make a price rise possible.

It was not expected that the price would move back to the high levels of three or four years ago, equally it was not thought that present prices would move any lower. Mr Kirk spent more than two hours with the group, which included the regional directors for North and South

America, and Asia, as well as the heads of research and marketing sections. “They gave me a full rundown on the economic outlook and told me about other developments,” he said. ‘They weren’t wildly optimistic about the future of wool but on the other hand neither were they unduly pessimistic.

“I’ve been most impressed by the research work going on here and by the new processes being perfected. These will make wool more sharply competitive with synthetic fibres and the development of new products should me-n new sales outlets.” Mr Kirk said he found agreement among the group that all sections of the wool trade, through the grower, mill owner, retailer and consumer, liked some stability in the price. ’There was recognition, too, of the need to adjust marketing methods to keep pace with national policies.” Mr Vines told Mr Kirk that the I.W.S. could see the start of a turn in carpet wool sales in the United States. Carpet Usage

Predictions had been made that United States usage of carpet wool would increase by some 15 per cent in the coming financial year. The increase would be the first recorded since 1963. Interest had been aroused

by the fact that some carpet manufacturers were now turning back to wool while a number of other manufacturers who had never used it were now thinking of doing so.

Commenting on Mr Vines’s statement that the New Zealand wool stockpile could probably be disposed of within three years, without disturbing the market, the manager of the New Zealand Wool Commission (Mr H. L. M. Peirse) said today in Wellington that the commission’s policy on the disposal of stocks, stated at the beginning of the season, was still being maintained. The commission had stated that none of the wool held in stock would be released at under the purchase price, to which must be added holding charges and other costs. Already this season some 1400 bales from the stockpile had been sold at sales in New Zealand at a price which covered the purchase price, holding charges and re-offer-ing expenses; and in fact the sale had yielded a profit margin of a few cents to the commission.

This was the stated policy of the commission, Mr Peirse said, and beyond this he was unable to comment at this stage. However, he said that Mr Vines’s comments were “somewhat heartening.”