WOOL CONTRACT

Dominion, Volume 13, Issue 228, 21 June 1920, Page 4

WOOL CONTRACT

THE SURPLUS PROFITS

SIR ARTHUR GOLDFINCH'S

ESTIMATE

AN IMPORTANT INTERVIEW

Some information regarding the wool contracts was given to the British-Aus-tralasian." last month .by Sir Arthur Goldfinch, the Director-General of Kaw terials. Speaking in hi« London. .omce, Bir Arthur Goldfinch said it was impossible yet to state what the final payments to the Australian and New .Zealand producerß would bo. Tho contracts had provided that tho British Government should pay for Australasian wool 55 per ceut. aver tho pre-war price, tot aUer orovidlnir for the public reeds of Britain md tho Allies it should share with tho Australian and Now Zealand Governments iny profits which might be made by sellift°i MtsraV Arthur 'tho t/ital pales of Australian and New SanHoal exceeded £2M,000,0C0 Bterlme. 'ho total amount of the wool atill unsoW ras about 2i million bales, up to *eoru rv 28 Wl9, tho cash account was still in rtien they might bo regarded as all^w rhat°profit VuZTaeia will receive " To , further question on his views o:i uture, Sir Arthur replied that they wer anguine. Ho refused to commit liimßell o any figure. but MEraminc that the wow iow on hand should fetch from >50 a bale, which was not hen it followed from tho facts ghen tha n addition to the price a d t y hB Britfsfi rnlasia would to £100?lovernment a profit woro MOOO Tho 40 or 60 millions w [ustralia and New Zealand's share. would e handed over to the respectlvc Govern N npnfefi of those countries •with tne mSerlal authorities dealt hiving no tort relations with the woolgrowers themThe' British authorities had been or ' t ' c K" d for seltag limited quantities of wodl ,t ari upset price to spinncfaandiM ructurers at tho same timo at wool was letng sold by auction at very much hig .j . r nrices. This course was taken, eaia iir Arthur, with the full srior knowtodg ,nd approval of tho Australian u . Vool Committee, and tho Prime Mlnletsr if Vanr TlAflland. "You must remember* io said, "that the novelty was the ™ 1 " ion saios; not the offerins at m * ,rice, which had Vhen tio iut the war. In April. 1919. wn motions began, there was a general tew ng of panic-80 per cent, of tho Briusn nilla had been occupied with military lnths during the 'war, and when Peac« ame and orders for cloth &?' a SfliS S« 10 almost universally frawnls'tat, when tho mJUs «re»--...j * A tnsikp civilian clothing ™!d be a great fall in prices all round. U a matter of fact tho exact opposite mmrrcd. But who was to be wise at I hat imn? Our great object was to estapllsJi table conditions., I should eiplain tha . oupled with the issue of wool atanuP et price, this price was made tlie mtnl sum at the auctions, and also that it wai m tho average Jis per cent, above irico paid to the growers lor. /J®® 1 - iddition to tho 65 per cent, above pro far prices, the growers wouid get 12i Per ;ent„ half of 25 per cent., extra profit on % rented actable ffiket and the retains of the wool industry. The upset friMS were not xesarded as by any means bean ittte time, and it was only Rradnilly that tho upset prices were sutotanMnerinos. the difference, also small at flm. in C d re OctobS°wtU eventually it*amounted Srfe/trrsn : oresight, but if we had not acted as we HA who can say what would have h a P" encd? Sentiment is of great importance, md it was desired to creato a state ot «iria in which people would operate, wo !ecmeditto> D ofVramount imporUnc •n flm wool grower to Bet tho wo<u textue Industry. goinsr again Europe a» n p e rices! £ a^trM" in proof of it. Before the armistioeit no JniM States Government bought 300,000 X of Wool at tho upset prico-a, total fSaso of about £12,000,080. In June, after tho auctions bad proceed for /ol months. America, tame convinced ,hat prices wcrojsoins lower, astad to n avo the contract cancelled. • She-was released from tho bargain, and Australia took exception to tho release, beluß »n -lined to think that it was bac }J^, B A M !' rt would seem not to bo very logical to blame ua ot tho same timo for se linE wool at an issue price and to blame us [or cancelling a contract, doing so after svo had seen how wool was trending After the cancellation of **° wool sold to America wasi oßeied at auc lion in Boston, and Bold thero at 100 per sent, over, tho price at 4P'f f rican Government had refused it. Half tho profit on this transaction-several mil lion pounds—would go far to rcwup tto Australian growers for any. loss thero may have been on lower prices realised than could liavo been obtained at auc iou an the 430,000 sin.co April 1919, I To o sifEgestion made that Australian md Now Zealand growers had been in'lined to think their intereßtß had been sacrificed to thoso of British traders by th sale of wool to them at a lower price ;han could have been obtained at auction, Sir Arthur replied: , "One .thing should bo borne in mind. iVh'other the price was low or not, and x iavo said that wo consider it a good irico to sell at, it was not a pi™®!? 0 ri Yen cuecially to British manufaoturerg. Phe wool was offered at tho same fixed chodulo of prices to tho toanufMhiroro if Franco,' Belgium, and Italy, withtho ibiect of getting the industry started iffain on a stable foundatiau As ama - er of fact, the machinery was not a\ anile to put all the wool rcaulred on tho narket at once by means of auclioni?, vhich was another Teacou why is6uo was or a time continued, tha amount issued leing gradually reduced. From April onvards until the ond of the year wo dl«ributed 70 per cent, more Australasian fool than was distributed in a normal pre'"From the beginning of tho contract and iffht uo to date, tho manufacturers of 'ffialia and New 'Zealand have been luylng the wool they needed at cost price, vhich is 25 per cent, loss than tho 1919 bbuo price here; and neither had they, of umbo, to pay the cost of carriage and 'ftScstlonefceneMlly as to hia optoion yrjrsr s?Jz. SK*4i» ioldflnch said that, when the growers Bold heir wool at 65 per cent, over pre-war irfcea thoy o.cted fairly and patriotically, ■it not with the object of making a preont to the imperial Government They md boon paid in ndvanco, whether the fool was sWped or not, Britain paying or storage anil takln? all tho Mskb oi en carriage, and they would makeavery übstantial .profit over mi above the oreinal price paid, to them. Tno pronts eaned by Australia would be much ereatf than those of New Zea and. because ho former had the vast bulk of the merSo wool fo? Which there wa t suoh e|trn,rdlnary demand. For low, and ™ edll ™ rossbrods. on the other hand. naiid was so comparatlvel> slack that at nee nB , for 'instance, three or four Ss ago, tho.British Government would rave been glad to cancel tho contract. Low rossbreda had actually been ««lat an* ion for olvilian purposes at a lower price han that charged to . t^e „A?ul- o was dnmatid was improving, and tnero wm prtpcet of a market for cro S » n ountries of Bnropo which could not. w'th hi present rate of exchange, afford the remendouß price paid for merinos