Storage squeeze leads to outdoor experiments

Press, 3 September 1982, Page 16

Storage squeeze leads to outdoor experiments

The size of the Wool Board’s stocks has led to experiments with outside storage of bales on wooden pallets under specially-de-signed tarpaulins, according to the chairman of the board, Mr J. D. Mcllraith.

He told the annual meeting of the Wool Electoral Committee in Wellington last week that preliminary trials have been carried out with a 280-bale, seven-high stack at the board's store at Seaview. “In technical terms were are very pleased with the results and, in terms of cost economies we anticipate, on a per bale basis, that one year's leasing saved will pay for the pallets and tarpaulins, the estimated life of which is between 10 and 15 years,” he said. The board's stocks now total about 425,000 bales, the highest since 1967 when over 700,000 bales were held. “The board owns one million square feet of storage space and leases approximately one million more," said Mr Mclllraith. “Should the board purchase a significant amount of wool this season, suitable and concentrated storage facilities could be somewhat difficult to arrange." For this reason the outside experiments have begun. The board’s annual report, also published last week, says that the board bid on 28 per cent, or 492,060 bales, of the offering at auction during the 1981-82 selling season. It actually bought 187,000 bales, 10.7 per cent of the total offering of 1.753 million bales, at a cost of $63.1 million. “However purchases in the United Kingdom and other New Zealand purchases brought the total spent during the season to $75.3 million. “To finance its purchases under its intervention policy, the board has now used its own non-levy capital funds to the extent of $66.7 million and has borrowed from the Minimum Price Funding Account some $Bl million.

“During the season the board's stock rose from 345,000 bales to 422,000 bales, involving a net investment increase of $21.5 million. “Sales from the stocks over the season amounted to 117,000 bales and realised $54.1 million. “From February, board stocks remained virtually static; its intervention prices butressing the market against unnecessary further falls. "More than 78 per cent of the new clip wool sold this season was sold at auction in New Zealand. “There was a drop in the amount of wool sold privately from 22 per cent to 20 per cent — mainly due to the effects of both the Government S.M.P. scheme and the board’s minimum price funding scheme which applied more easily to auction-sold rather than to privately-sold wool. “The percentage of wool scoured before export has declined slightly over the past two seasons. This season it was around 48 per cent of the exported clip," said the report. Mr Mclllraith told the wool electoral committee that the board's international activities during the current season could be seen as consolidation. “We have assessed our markets and have identified specific projects to be carried out in collaboration with selected companies in a number of countries around the world,” he said. “Much of this depends upon a close relationship with the I.W.S. and a good example of this is our combined work in the United States. “As we mentioned in the report, the United States market is showing some signs of turning back to wool and we will be continuing our close liaison with the United States Wool Bureau to stimulate this interest. “We will be providing raw wool and technical expertise, contributing to a technical

carpet seminar, and will be visiting major spinners and carpet mills during the season.

“However, it is the People’s Republic of China that remains New Zealand’s major market development prospect for this season and this is the market we will be concentrating on. “We will be looking at maintaining our existing contacts and creating new ones within the Chinese textile and carpet industry. Our major aim is to expand the range of wool types currently purchased by China. “As part of this goal, the board will be hosting a group of Chinese wool technicians to New Zealand who will be here to study our wool selection and use. "We will also be conducting technical seminars in China, emphasising the same topics and assisting the Chinese industry to improve its use of New Zealand wools for handknitting yarn, blanket and fabric production.

"The board has been involved in the development of a Chinese mill and we expect production from this venture could come on stream in early 1983. We are looking at another development proposal planned for the Chinese textile and carpet industries. “We will be continuing our support for the I.W.S. in Eastern Europe with processing trials in the Soviet Union and Yugoslavia. We expect confirmation very shortly of a visit to New Zealand of a top level Government and textile official delegation from the Soviet Union, planned to take place later this year. “The final area we will be concentrating upon is the developing markets of the Middle East, North Africa and the Indian continent. These markets, which we have already assessed, show considerable potential but there are some trade obstacles still to be overcome, particularly in Iran.

“Two staff members have just returned from the

Middle East and all developing areas will continue to receive the board's fullest attention.” he said. Mr Mcllraith said the board anticipated shifting into its new building in May of next year. It is in Featherston St, next-door to the current Wool House.

"Of the 14 levels, we will be taking six, leaving eight floors to be leased mainly on long term contracts. More than 30 per cent, of the leasable space has been signed and sealed for and there is strong interest in a further 40 per cent. We anticipate that the remaining space will be taken up with short term leases ■ and smaller tenancies. “We are confident that the building will be fully leased before its opening. "The building's capital gain will be substantial over the years, and the advantages' of having all our staff under the one roof are immeasurable," said Mr Mcllraith.