WOOL PRODUCTION

New Zealand Herald, Volume LXXIV, Issue 22851, 5 October 1937, Page 5

WOOL PRODUCTION

INCREASE LAST SEASON MARKED FALL IN CARRYOVER ECONOMIC COMMITTEE'S REVIEW [FROM OUR own correspondent! LONDON, Sept. 15 Production of wool in the chief exporting countries was slightly higher in the 1936-37 season than in 1935-36, according to estimates published in the Imperial Economic Committee's annual review. Wool Production and Trade, 1936-37. The chief increases took place in Australia, 40.000.0001b.; Union of South Africa. 3.5.000.0001b., and Argentina, 19.000,0001b.

In spite of the improved supply position, wool prices showed a sharp advance during the season, the rise in crossbred values being particularly marked, states the review. While this movement in wool values' was partly in sympathy with the general rise in commodity prices, • intensified demand on the part of consuming countries was responsible for much of the increase and precluded major price fluctuations. Important changes took place in the buying policy of consuming countries and the demand position developed along somewhat unusual lines. The trade dispute with Australia reduced Japanese purchases there to negligible proportions during the first half (JulyDecember) of the season. Japan returned to the Australian market in January, though on a somewhat reduced scale. Increased United States interest in clothing and combing wools largely compensated for the lack of Japanese competition in Australia. The high prices paid by Japanese buyers caused a certain part of the usual United Kingdom demand for South African Merinos to be deflected to Australia, while the keen world demand for crossbreds also caused a reduction in the proportion oPiiie New Zealand clip shipped to the United Kingdom. Germany was hampered by the competition of Japan in South Africa- and South America, and took slightly increased amounts from Australia. Belgium and Italy also increased their purchases in that country. The generally reduced activity in the French wool textile industry caused a further reduction 111 the amount of wool required and imports were the lowest for many years. '

These changes in demand were largely complementary in effect, and the resultant pressure was apparent in the maintenance of tvool prices, in spite of world economic and political complications, and in the low level ■of unsold stocks in all selling centres at the end of the season. In Australia stocks at June 30 aggregated 14.000,0001b., as compared with 23.000,0001b. a year earlier.

During the same period New Zenlaud storks fell from 17.000.0001b. to 11.000.0001b.. the greater part of which was disposed of in July and August. Unsold stocks in Smith Africa at the end of the season negligible. While the South American season doe 3 not nominally close until the end of September, trade reports indicate that the hulk of the clip was cleared earlier than usual, and unsold stocks, particularly of coarse wools, are very small.

RECENT PRICE DECLINE BROKERS HELD RESPONSIBLE LONDON, Oct. 3 Leading topmakers at Bradford suggest that some responsibility for the recent decline in wool values rests upon the brokers, who offered more wool at the London auctions than buyers were able to absorb. Tf, instead, there had been modified in accordance with the demand, the values would have been maintained.