LONDON TRADE REVIEW.

New Zealand Herald, Volume LIX, Issue 17984, 9 January 1922, Page 6

LONDON TRADE REVIEW.

BUTTER MORE CHEERFUL. GOOD SALE AT LOWER PRICES. !. BRIGHTER WOOL OUTLOOK. STAGNATION OF SHIPPING. By Teleempls—Pr«aa Association—^ Copyright. (Becoived 7.20 p.m.) A. and N.Z. LONDON, Jan. 7. Business on the Stock Exchange in the first week of the New Year has been somewhat disappointing. Various factors contributed to..the dullness, notably some fairly large Belling orders, rumours of an early general election, considerable profittaking, and last but not least, now issues by South Australia, Chile, the Bristol Corporation, Buenos Aires and Western Railway, aggregating nearly £8,000,000. All theso loans were over-subscribed, Bristol's loan of £1,000,000, issued at £96 and bearing 5J per cent, interest, being subscribed thirteenfold in two hours. Chile's loan of £1,657,000, issued at £95 and bear in tr 7$ per cent, interest, was subscribed fivefold also in two hours. This heavy subscription diverted money from existing stocks and caused flatness, in British gilt-edged securities especially, as it is known that several fresh issues are coming. The fact that Bristol was able to secure its loan J per cent, cheaper than South Australia has caused some comment in Colonial circles. Tho explanation is simple. \ In the first place, corporation stocks are always popular with the, investing public, who also liko their security near at hand; secondly, Bristol 'is a thriving community, with a population of 377,000, and with an indebtedness little over £9,000,000. Easy conditions continue on the money market. Yesterday's Treasury bills were allotted at a fraction under 3J per cent., tho lowest rate on record. Hop? is reviving of a reduction of the bank rate before long. Slump in Margarine Trade.

Tho butter market jj more cheerful. The present low retail prices are stimulating the demand, and large quantities aro going into consumption. New Zealand is retailing at Is 4d per ib., and good Australian at Is 2d per lb., and occasionoily Is. Traders are hopeful that now the public has got back to butter the consumption will grow and prices recover somewhat. If only the incubus of this Government stocks and the fear of their being thrown on the market can be removed, the position is hopeful. Tho public has got tired of margarine, and only the poorest will buy it when good butter is procurable at about la 4d to Is 6d per lb. The margarine trade in already feeling the effect of competition and consumption of margarine is considerably below normal despite a reduction olf Consequently thero is great, weakness in all descriptions of oil-bearing material, notably copra. The year opens favourably for the wool trad* The outlook is brighter than at any time in 1921. There is a strong demand in all the world's wool markets, and the genoral opinion both in Bradford, and London is that Tuesday's sales will open with a 10 per cent, advance over tho December closing ratea. There is still a great scarcity of fino tope, of which the production is barely sufficient to meet present requirements, and topmakem are '■ r 6ry strong in their ideas of prices for 64 s. The demand for low and medium crossbred tops is also improving, and the advance of crossbreds at the Timaru sales has been a welcome surprise to the market, giving rise to a hope that crossbred values may soon reach the proper level compared with Merinos. Another satisfactory feature is the improvement of the heavy woolen trade. One Dewsbury firm has commenced running machinery night and day after a lapse of many months. Other mills are able to give their employees more work. They aro not receiving orders for large quantities, but repeat orders are coming in fairly well from the Colonies and the Continent.

3495 Bankruptcies In 1921. With the cessation of the activities of the Australian Wheat Committee, which during its existence sold over £100,000,000 worth of wheat, the position here becomes interesting. Instead of all Australia's wheat being handled by the committee there are now to be eight firms handling it, four selling for their respective State pools and four dealing with wheat outside the pools, so we are likely to see healthy competition similar to that which prevailed before the war, when buyers commence operations.

The severity of the general trade depression in 1921 is flliaitrated by tho number of bankruptcies in the United Kingdom, which totalled 3495, compared with 1594 in 1920 and 753 in 1919.

Tumor, Davidson, and Company, write: "The depression of shipping values has been accentuated by the throwing on the market of various fleets of steamero and forced sales of new steamers contracted for which the owners have been unable tJ complete. There is no guarantee that more fleets, especially those purchased at hieh prices may not be thrown on the market. Owners of pre-war boats cannot tope to I do moi'e than make ends meet until trade improves sufficiently to induce the large proportion of laid-up tonnage to resume business. Prospects in the shipbuilding trade are worse than ever. Ordinary tramp tonnage cannot be built under £12 a ton, which is prohibitive. In the absence of odere it is only a question of time before a great many yardi! muiit close."