CONTROL OF WOOL

Evening Star, Issue 17542, 23 December 1920, Page 10

CONTROL OF WOOL

AUSTRALIAN SCHEME. SOME LATER PARTICULARS. MAY take IN DOMINION " CARRY OYER.” No more important conference of woolgrowers than that which met in Melbourne on December 7 has been held since the pool was established (says the ‘ Argus ’). The conference had been called to consider a comprehensive scheme, devised by a special committee, composed of the chairman of the Central Wool Committee (Sir- John Higgins), Messrs Stevenson Fraser, R. J. Boyne, and W. J. Young, providing for an association registered in Australia to control the, sale of all the carry-over wool under the Imperial contract which is 'to be terminated. Some particulars of the scheme were given in this journal on Tuesday. What foJjows touches a somewhat aspect. The original contract for the sale of the Australian wool clips to Great Britain provided- for the payment to the grower of a flate rate of 15Jd a Jb. plus half of profits made on the resale of any wool not required for military purposes. The Imperial Treasury advanced the 15id a lb immediately the wool was appraised, and the pool recouped the Treasury out of the proceeds of sale. The position to-day is is that, alter paying a- dividend of about £6,000,000 to Australia as a half-share o.f the profits made up to March 30, 1919 the Imperial Treasury has been paid back all the money it advanced, and the wool account is slightly in credit. In other words, every penny received for the sale of wool still in the pool will be profit, and will, under the original contract, be divisable equally between the Imperial Government and the Australian grower. Under the scheme approved by the conference yesterday, if it be agreed to by the British authorities, control of the sale of the remainder of the wool will be surrendered by Britain. Political interference will be eliminated both in Australia and in London, and the disposal of the wool will be placed in the hands of a. directorate appointed by the Australian grow ers. The proceeds of each bale sold, after deducting expenses, will lie divided equally between the Imperial authorities and the proposed Australian Association. In effect, the grower under this scheme will bo taking half his share of the profits —represented by the assets of the pool after the Imperial Treasury has been paid —in kind, instead of wa'iting until the assets are realised and drawing his share in cash, as was contemplated under the original contract. The new scheme will give the grower a negotiable security, in the form of shares in the proposed concern, in place of the prospect of an unknown profit which he might not receive for some years. It is estimated that Australia’s share of the assets in the pool to be taken over by the proposed association will be worth approximately £25,000,000. Sir John Higgins was careful to sav that the Imperial authorities had not yet agreed to the soheme. But is safe to assume that it would not have been promulgated without an understanding that ■no hitch would occur in that quarter. Every grower who contributed wool to the Imperial pool in any one of the four seasons during which it operated will be entitled to shares in the proposed organisation, which is to bo called the British-Aus-tralian Wool Realisation Association. Ltd in proportion to the appraised value of his clip. It is proposed that bis interest in the association should Bb given him half in debenture stock and half in shares. Both the debenture stock and the shares will be negotiable, but the debenture stock will be a first charge on the proceeds of the sale of the wool, and will therefore always be worth its full face lalue. The value of the shares, however, will depend upon the prices ultimately obtained for the wool. The appraised value of all wool contributed to the pool was £159,896,596. As tho capital of the proposed organisation is to be approximately £25,000.000. each grower can roughly estimate the value of his interest in the proposed" association at a little less than one-sixth of the appraised price of all the woo! which he put into the pool. For instance, a grower, the total appraised value of whose wool in the four clips which formed the pool was £6OO, will receive approximately £IOO worth of debenture stock and shares' in the proposed association. Once the association is formed, it is hoped that the New Zealand and South African carry-over wool may also be brought under ‘its control, thus largely reducing the danger of cutthroat competition.