SELLING OF WOOL

Hawke's Bay Tribune, Volume XXIV, Issue 97, 7 April 1934, Page 11

SELLING OF WOOL

Tare Objected To AGITATION IN AUSTRALIA For many years the term “draft allowance’’ has been the cause of much controversy in the wool trade. It has been the custom from the commencement of wool sales to allow buyers a sort of weights discount, known as the draft allowance. Tho custom indeed is much older than the Australian wool trade. Throughout the Commonwealth and New Zealand tho discount is lib for every 1121 b purchased. On British wools in England an allowance of 21b a cwt. is made, and in South Africa there is an allowance of 131 b a bale to cover both ta.re and draft. Nor is the custom confined to raw wool. In some form it goes through the various stages, to tops and yarns, and on to manufactured goods.

This custom is admitted to be au anomaly and should, if possible, be abolished but the difficulty is to find means of getting rid of it. Buyers take the so-called concession into account when valuing wool, and contend that the grower makes no allowance actually. Many growers, on the other hand, imagine that they are giving away a pound of wool with every cwt. sold, but there are some growers who acknowledge that the concession is more imaginary than real. All growers and their selling brokers, however, would like to have the anomaly removed, and they have been persistent with their attacks upon it. Mr G. L. Aitken, chairman of the National Council of Wool-selling Brokers of Australia, has been in correspondence with the Australian Woolgrowers’ Council and tho British Wool Federation of Bradford Throughout tho controversy it has always been recognised that any alteration in the custom must come from the buying section of the trade. In consequence the Australian authorities sought to convince tho British federation in the first place that the allowance should be abolished. The federation appointed a committee which has now reported. It referred to the antiquity of the custom and added: “We can assure you that all the buyers allow for the draft in valuing wool. Competition is so keen that the buyer who did not allow for the draft in his calculations would buy very little wool. Different, trade allowances are made throughout all sections of the trade, and in nil cases are allowed for in calculating the cost.

“The prices buyers pay are based on the assumption that they receive 1121 b and pay for 111 Ih. We feel, therefore, there can be no justification for upsetting the present system, when the only result of the change would be to make grout difficulties for the buyer, who would have to readjust all his ideas of yields, which are the result of mnnv years’ practical experience. “Tho principal argument, and the one which we wish to emphasise, is that the withdrawal of the draft would not put the grower in a better position, and would also seriously embarrass the buyer in his calculations. We feel convinced that if this argument could bo communicated to the growers it would do much to allay the agitation and unrest which appears to exist.”