WOOL MARKET

Evening Post, Volume CXXV, Issue 19, 24 January 1938, Page 12

WOOL MARKET

STOCK POSITION

NOT AS GOOD AS IT WAS*

Winchcombe, Carson. Ltd., report:— If consumption were 'normal wool, would be worth more money than it is at present. It was estimated that the current season's clip of Australia, South Africa, New Zealand, ar.i South America, plus carry-over at June d 0 last, would be the equivalent of 7,246,000 bales of Australian .weight, a slightly larger total than a year before. Our Port Elizabeth correspondents inform us .that the African clip is now estimated to show a decrease of about 20 per cent, or 168,000 bales on the preceding twelve months. As a result the quantity available from the five countries mentioned is likely to be in the vicinity of 143,000 bales less than last season. In addition the supplies of -wool and tops on hand in Great Britain, oti the Continent, and in the United States were smaller at June 30, 1937, than at the similar date of 1936. Unfortunately, the quantity of the raw material used in America has receded to a marked extent and less has also been used in the United Kingdom. In addition Japan's purchasing has been most restricted. Stocks of wool are certainly not large in consuming countries at present, but , they are greater in. some producing countries than.at this ■ time last year owing to the. smaller supplies offered during the past half-year. Actually the grower holds.the wool, whereas normally it is held by the manufacturer or merchant abroad,- The very strong'statis^ tical position of last June has, therefore, partially disappeared owing to the reduced consumption. That fact should be realised by those concerned in the producing countries. In the depression of a few years ago, consumption was kept up by selling the staple at low prices and thereby encouraging its use. Existing conditions in the world do hot warrant prices on depression basis, far more people being employed and purchasing power in most countries, therefore, being greater. But in considering the wool outlook due consideration should be given to the change in the statistical situation. JAPAN AND U.S.A. Improvement, more or less permanent, in wool prices unquestionably depends upon more sustained buying on the part of Japan and a turn for the better in mill and general industrial activity in the United States. The spurts and lulls, experienced of recent months do not justify expressing a definite opinion regarding the probability or improbability of a" favourable alteration in the Japanese or American outlook. . 1 A brightening in that regard would have good general effects in addition to the wool which might be bought for the two countries quoted. It would produce greater confidence among wool consumers everywhere. The December experience of improved prices gives an indication of the brightening in trade which would occur in England if users felt assured that all consuming countries would buy wool freely. Wool market strength at that time caused a spurt in sales of tops, yarns, .and' fabrics both on internal and ■ export . account. v Business 'has been "marking time" for months awaiting more definite . stability in prices. Few -buyers desire,to see woolcheaper, but the great .bulk of the manufacturing industry would welcome, a firming market \ and. its interests would be best served by that development. Growers certainly wholeheartedly join in that desirable issue.