PRESSING PROBLEM

Hauraki Plains Gazette, Volume 48, Issue 2887, 31 March 1939, Page 7

PRESSING PROBLEM

WOOL PRODUCTION COSTS

VIEW HELD IN AUSTRALIA

Few will deny that raw, wool has been passing as freely as could be desired from the producer to the manufacturer this season, says the Australian Mercantile, Land, and Finance Company, Ltd. The clearances at auction in Australia have neverbeen more consistent or satisfactory. It is comforting to know that the mill owners of the United Kingdom, France, and Australia have been able to absorb well above 70 per cent, of the offerings during a period of extreme difficulty, brought about by restricted international trading facilities, and that despite these difficulties rarely has the demand for wool come from a wider circle of buyers.

Unquestionably the experience of •the selling campaign this season has gone far to dispel doubts concerning the future demand for wool, but it is clear also that owing to many changes in the textile field and the increasing supplies of competing raw materials, the price factor is likely to dominate the demand for wool to a greater degree than ever before. It is quite probable, according to well-informed opinion, that the days of high wool prices are past, and the manufacturers will need to obtain future supplies at approximately current values.

What, then, we might ask, is the prospective position of the wool-pro-ducing industry with wool at current values? Adverse seasons must be ■taken into account, pests and diseases are still present, and even greater provision to cope with them on scientific lines must be made. Owing to drought conditions, which have affected all the great pastoral areas during the last few years, and which continue in many parts, the majority of growers have been forced to enter into commitments which handicap their operations most seriously. In fact, a set of circumstances beyond the powers of growers to avert has resulted in conditions which render the future prospects of many producers exceedingly alarming, and unless a series of bountiful seasons is experienced and higher prices realised, it will be impossible, in view of their commitments, for a big percentage of growers to earn profits from wool. Consequently, it is suggested that the time has come to direct pointed and sustained attention to the problem of costs of production. Some publicity has been given to this problem of late, but not enough. It should be practicable to reduce these costs to a figure which will enable the grower to contemplate the future with confidence, even though substantial increases of wool prices are not to be expected. Australia cannot influence the wool market rates, which are determined by the world at large, 'but Australia can, and should, see to it that the production costs leave a margin of profit to the average grower, whose equipment, experience, ability, and industry combined make him the main corner-stone in the Commonwealth economic structure.