The Press WEDNESDAY, AUGUST 28, 1968. The Woolgrower’s Budget

Press, Volume CVIII, Issue 31769, 28 August 1968, Page 16

The Press WEDNESDAY, AUGUST 28, 1968. The Woolgrower’s Budget

The August wool sales in Christchurch and Timaru give Canterbury farmers their first firm indication of the new season’s demand for their wool. The omens this season are not propitious: both at Timaru last week and at Christchurch yesterday some of the coarser counts sold at prices lower than 12 months ago. For the producer of halfbred and Corriedale wools, however, the outlook is rather better: most of these counts fetched 5c per lb or more above last August’s prices. These are still not handsome prices, for last August fine wools were selling at their lowest levels for nine or 10 years.

The market outlook is now healthier than it was 12 months ago, when the Wool Commission was buying up to 43 per cent of the wool offered at each sale. Today virtually all the wool offered at auction is being bought by the trade, mostly for overseas mills. The commission has announced its intention of putting up to 100.000 bales of its stockpile on the market this season. With the prospect of an appreciable increase in the supply of wool to be offered, and with virtually no intervention by the commission to stimulate demand, the current low level of prices is scarcely to be wondered at Indeed, the wonder is that the market is not even more depressed.

This is small consolation to the individual grower, particularly of coarse wool. The crossbred producer, who had a thin time last year, may have an even thinner time this year, if he had budgeted for a higher price for his wool this season he would be well advised to recast his budget. Some growers have begun to mate coarse crossbred ewes to finerwoolled rams, and others may now have a further incentive to do so; but this is a step which should not be taken lightly. The effects of cross-breeding on fleece weights, wool counts, lambing performance, and so on, are complex and delayed. All woolgrowers face higher costs this year because of devaluation, while the prices most of them are getting for their wool today are lower than before devaluation. How much further prices might have fallen if New Zealand had not devalued is mere speculation, neither comforting nor profitable. The well-established farmer who has low mortgage commitments should survive this season, like the last, without undue hardship. Recent entrants to farming, particularly those embarked on development, are hardest hit. Without special assistance, another season like the last would put some of these farmers out of business. Last year Government agencies, trading banks, and stock and station agents showed commendable understanding of the plight of struggling young farmers. They may have to extend even more credit this season, if, in order, to do so, they are compelled to refuse loans to some credit-worthy borrowers, there should be no hard feelings. In these difficult times the burden must be shared: and a helping hand for those in need will not be begrudged by the more fortunate.