WOOL DISPOSAL

Nelson Evening Mail, Volume 80, 1 December 1945, Page 6

WOOL DISPOSAL

MINISTER EXPLAINS PLAN ACCUMULATION OF STOCKS COMBINED EMPIRE SCHEME (From Our Parliamentary Reporter) Wellington, Nov. 30. Britain now held £170,000,000 worth of wool in store in different parts of the world, an amount variously estimated as 12 to 15 million bales, which might require 12 to 13 years to dispose of. in conjunction with current clips which were always coming to hand, said the Minister of Marketing (Mr Roberts) when opening the second reading debate on the Wool Disposal Bill in the House of Representatives. The Minister said that wool was and always had been a basic commodity of New Zealand’s economy and under the proposal the State was undertaking immense financial obligations on behalf of the woolgrowers. The measure was also important because it provided for a combined British Empire wool scheme. In a short survey of the plan Mr Roberts explained that it would be controlled by the Joint Organisation operating from Ist August, 1945, with subsidiary organisations in each Dominion to conduct local operations. The Joint Organisation would operate with separate pools and the United Kingdom—New Zealand pool would take over present stocks of New Zealand wool valued on f.o.b. cost basis at £32,500,000 sterling. After applying the present book profit on New Zealand wool sold outside the United Kingdom—£7,ooo,ooo—in the writing down of the opening stock the net value was £25,500,000, of which the New Zealand Government would assume responsibility for £12,750,000 in four annual instalments of £3,200,000. No interest would be charged by the United Kingdom on outstanding instalments and accumulated storage and other charges were written off. An additional responsibility of the New Zealand Government would be the advance of its half-share of the cost of buying in wool not sold at auction at the reserve price or better. Over the twelve- years estimated as necessary to liquidate the stocks the maximum or peak outlay by New Zealand for advances was reached at the end of the 1948-49 season with a total of £9,350,000. Conversely old wool sold in the market would be credited to the New Zealand Government account —50 per cent, value—and retained by Britain against the final payment. Operating expenses of the Joint Organisation would be borne equally by the wool growers and the organisation itself. Over the 12 yeari the total cost of operating the Joint Organisation was estimated at £8,100,000. It was intended that the total current clip would be offered for sale at some time during the season and also a proportion of the old wool stocks. The assumption was that sales would be at a level 20 per cent, above pre-war levels. Current clip wool would be appraised at reserve prices fixed by the Joint Organisation in line with market price expectations. For the 1945-46 season or until sales by auction were resumed the purchase procedure would remain as at present. Prices for 1945-46 would be the same as at present The plan was to be reviewed at the end of five years. The Minister suggested that woolgrowers could help the new scheme by refraining from planning increased production in the period when accumulated surpluses were being gradually sold. RIGHT SOLUTION OFFERED Mr K. J. Holyoake (National, Pahiatua) said that the Bill offered the right solution for the problem of large surpluses, and the same procedure might well be used to a greater extent in the disposal of surplus stocks of other non-perishable farm products. The advantages of the measure, said Mr Holyoake, were that it removed the fear of a great slump in wool prices throughout the world and in this country, and it removed the market from the immediate threat of the tremendous stock-pile of wool which would bring prices tumbling. Mr E. L. Cullen (Government, Hawkes Bay) said the wool industry of New Zealand had a great record in the Empire, and with an improvement in the quantity of higher-class wool he thought the Dominion would be able to compete not only against other countries, but also against synthetic manufactures. HIGH COUNTRY PRODUCER Mr W. H. Gillespie (National, Hurunui) said he believed that the lower-grade wools produced in New Zealand would be needed overseas for a long time to come. The Government had to tackle the problem of the highcountry wool producer or more of the high country would go out of production. That would have serious repercussions on the country’s economy, because other farmers relied on the high-country producers to supply breeding ewes. Mr F. Langstone (Government, Waimarino) said he hoped the scheme would not peter out in 13 years. He hoped surpluses of other commodities would be dealt with in the same way so that there would be planned, rational marketing in the interests of all the countries. There would be no guarantee of employment if the prices of exportable surpluses were to be interfered with very materially. - Mr E. B. K. Gordon (National, Rangitikei) said the price of wool was only a fail medium price, and costs had increased tremendously during the last few years. The future of the wool producers was held in the balance until the accumulated stocks were got rid of, and depended on the Board, on the manufacturers in England, and on the amount of research undertaken. The Bill was put through its remaining stages and was passed. Men Going Bald. Men going bald are advised to secure a jar of Birmese Hair Root Tonic. Birmese will banish dandruff in 3 days, stop falling hair, help grow new hair. Only a minute’s massage every night required. Obtainable from R. W. Martin, M.P.S., Chemist, Nelson. Product of Firmese Laboratories Ltd., Hereford-st., Christchurch. —Advt.