WOOL PRICES

Evening Star, Issue 21945, 4 February 1935, Page 8

WOOL PRICES

HO IMMEDIATE IMPROVEMENT PROSPECTS FOR WEDNESDAY'S SALE Optimism is a characteristic of the man on the land. In times of depressed prices, heavy mortgages, and little credit he hopes for the best. Improved times are always “ just around the corner ” in his outlook. And in the periods of affluence—profitable prices, bountiful harvests and clips, and a free supply of cheap money—he believes that the prosperity will last for ever. However, the farmer who expects an immediate appreciation in the value of wool as immediate as Wednesday next, when his clip will be sold in Dunedin would be over-optimistic. There is nothing in the trend of the market in the dominion or in conditions overseas on which to soundly base any expectations of a rise in price. Gauging the movements of the wool market is always problematical; not even those men recognised as experts in the trade can make their anticipations with any high degree of certainty. They would quicklv be wealthy and retired if they had the gift of “ second sight.” For the present they can forecast no improvement. Wednesday’s sale in the Burns Hall will be the second of the Dunedin series. Because the first sale here in December showed an improvement on northern rates many growers are hoping that there will again be an appreciation. They forgot, however, that the December auction set a market at a higher price, and since then the realisations throughout New Zealand have been based on those values. The indications are that, at the best, Wednesday’s prices will be firm, and no more, on December prices. For this sale the Wool Committee made a limited allocation of 25,000 bales, and the catalogues have filled. The offerings by the various selling firms and the order of the auction are as follow:

Bales. Wright, Stephenson, and Co. ... 6,908 Dalgety and Co 5)156 Donald Reid and Co 3,123 National Mortgage Company ... 3,995 Stronach, Morris, and Co. ... 1,745 Otago Farmers’ Co-op. Association 2,301 Loan and Mercantile Company 2,081 Total 25,306 The quality of the wool, which has been opened out in the stores for the inspection by the buyers, is heavier in condition than the wool sold at the first auction. This is accounted for by the offerings representing later-shorn clips. The first auction in Dunedin showed an improvement on northern sales, but since then the market has ruled fairly steady. The operations of the Continental buyers, especially Germany, were very noticeable in December, and the trend of Wednesday’s market will probably depend on whether or not Germany is a competitor. The general anticipation is that the market will remain steady on December prices. There is very little hope for an improvement. Although the Continent made the demand at the December auction, the northern sales have shown that the Continental demand has eased to a certain extent, but that Bradford has been operating more freely. , A total of 800,000 bales was the estimated offering at all New Zealand sales this season, and an average of £lO to £ll a bale would be fairly profitable to the growers. When the selling season opened at Auckland the realisations were so low as to cause despondency. A large quantity was passed, and the average price was only £7 16s a bale. However, it had to be remembered that the Auckland province on the whole produces the lowest grade wools. The average at the Wellington sale increased to £9, and values improved at the South Island sales, the Dunedin market setting the main, at which prices have since been maintained. At Dunedin’s first sale the wool averaged 7.94 d a lb, or £lO 12s 8d a bale. The returns to the growers slumped compared with the previous year’s cheques. In February last the wool brought an average price of 15.15 d a lb, or £2l 3s 3d, and it seems that the pastoralists who offer their wool this week will have to bo content with a little over 50 per cent, of those returns. Wedriesday’s offering comprises a fair number of station clips, representing fine wools, and also a fair percentage of cross-breds. The latter is not so much in evidence as at previous sales in February, owing to many farmers not being prepared to meet the existing market. All the buyers are now in Dunedin, many arriving on Saturday from the Invercargill sale. They were busy today in the stores assessing the values of the offerings.