No wool slips “out the door”

Press, Volume CXV, Issue 33965, 4 October 1975, Page 2

No wool slips “out the door”

A reassurance that it was still the Wool Marketing Corporation’s policy to sell stockpile wool at auction or through the trade was given by the corporation’s managing director (Mr H. L. Peirse) in Christchurch yesterday.

Mr Peirse made this comment when he and the deputy operations manager of the corporation (Mr R. E. Buchanan) attended a question and answer session at the annual general meeting of the New Zealand Woolbuyers’ Association.

Mr Peirse said the corporation used an open-door policy to cover all licensed exporters. Had any wool slipped through the door, he was asked. Mr Peirse replied that 120,000 bales had been sold in six months to licensed exporters. Of course, the corporation did not necessarily know where this wool was going. Had the corporation used this door, the questioner pressed. “We have not sold a bale to any central buying organisation,” Mr Peirse replied. A buyer, Mr D. L. Ambler, expressed concern about the corporation’s intervention price, saying that buyers were going through a situation where most of their customers were putting in bids for November-December deliveries, which were 5 to 10 per cent and more below the intervention price.

In spite of some leading questions from the trade, the corporation was complimented by the president of the association (Mr D. K. McDonald) on its disposal of “the first enormous stockpile," with a minimum of disturbance to the market It was a well controlled and administered exercise, he said. The corporation was to be complimented on its basically commercial approach, and he hoped this would be a permanent feature of its operations.

“This has created a stalemate,” Mr Ambler said. “We have to gamble on whether the corporation will weaken and lower its intervention figure.” Mr Ambler asked Mr Peirse whether the corporation intended to maintain the present levels for the rest of the season. Mr Peirse replied that the corporation’s policy was flexible. There had been a number of changes during the 1973-74 season — some up, and some down — to adjust to the marketing realities of the time. The Australians had initiated this system, he said.

They chose to make frequent changes. In New Zealand the aim was to maintain a particular level for a reasonable time. Last year, prices were adjusted three to five times. Some of them were up, particularly at time of devaluation. "The intervention price is constantly being maintained and guided by what we think is a sensible assessment of the market,” he added.