WOOL, ITS POSITION AND PROSPECTS.

New Zealand Mail, Issue 1206, 12 April 1895, Page 5

WOOL, ITS POSITION AND PROSPECTS.

{From the Australasian.)

In a pamphlet issued this week by Messrs Goldsborough, Mort and Co., Limited, the present condition of the wool industry and its future prospects are dealt; with in a careful and skilful manner. The pamphlet will Well repay perusal by all who have the great staple industry of Australia at heart. The year 1894} as the writer points out, was the most disappointing ever known since the inception of the wool industry in Australia. Throughout 1893" there had been a fairly steady market, notwithstanding the financial troubles of the times, and in 1894 it was generally anticipated by all those engaged in the industry that there would be an end to the low prices that had ruled during 1891, 1892 and 1893. The abolition of the United States wool duties gave confidence to those who held this opinion, and it was fully anticipated that this measure would lead to a revival of the wool trade throughout America and Europe. Unfortunately those anticipations were not realised; instead of the market improving it continued to fall till it stood from 10 to 15 per cent, below the level of the previous low prices. The widespread depression, though it may have widened the markets for wool, has tended to restrict general consumpt ? on, and this has resulted in a year of declining values and unremunerative trade. THE ALLEGED GLUT OF WOOL. On this subject thir>writer of the pamphlet says : . k- " An analysis of the figures affords this no support. The evidence of stocks may be first considered, for which European statistics afford sufficient basis. Actual statistics as to stocks of manufactured and semi-manufactured goods do not exist, and in the absence of such their proportions are based upon the general acknowledgments of the trade. There is no reason to suppose that at the present moment they are proportionately heavier than at other periods during the last twenty years, particularly in the years 1884-86, when the same cry was raised; indeed, the disinclination to buy freely into stock, and the hand-to-mouth system of buying, have of late been conspicuous. Actually the stocks may be greater in amount, though relatively less. In any case they are wholly dependent upon the supplies of raw material, and if it is shown that in reoent years the percentage of stocks of raw wool to supplies is below the mean percentage of the last twenty years, the contention of over-accumulation, unless it has b9en in progress over the whole of that period, is- difficult to maintain. If further it appears that the increase of supplies has been accelerated during the past ten years, while the percentage of such stocks has actually diminished, it follows that consumption has rather outpaced production, and that but for other pressure there must have been advancing \alues." During the period of ten years, from 1875 to 1884, the mean percentage of stock to imports on December 31 was 9£, and in the ten years from 1885 to 1894 it was per cent., the mean of #he 20 years being ' 8£ ? per cent. It~ Will-be-.seeia that the percentage of stocks to supplies during the last decade is actually 2 per cent, smaller than during the previous ten years, while if the accelerated growth of production is considered it has in ratio decreased per cent. The increase of supplies durin the period of 1875-84 Was 33£ per cent., while in that of 188594 it was 50 per cent. /> PRODUCTION PER HEAD DIMINISHING. The movement of supplies is as under :- SUPPLIES OF AUSTRALASIAN, CAPE, RIVER PLATE AND " OTHER SORTS " OF WOOLAVAILABLE FOR EUROPEAN AND NORTH AMERICAN CONSUMPTION.

These figures do not include the wool produced on the continent of Europe, for which the 1894 figures are not yet available, but which is believed to be stationary or declining. The position of supplies is thus in no way oppressive, having been practically stationary for the last two years, during which a substantial decline of values has occurred, and when it is borne in mind that the wool-consuming population of Europe and North America is increasing at the rate of from 4,000,000 to 5,000,000 a year, it will at once be seen that so far from there being any undue increase in the supplies they actually show a sub* stantial decrease per head. For the current year it is estimated that there will be little material alteration, a moderate increase from Australia and the Eiver Plate being nearly counterbalanced, by reduced production in the United King> dom and North America. THE FALL IN PRICES GENERAL. Over-production cannot therefore be seriously urged as responsible for the fall in the value of •wool. The real explanation must be found in the interdependence of all commodities. Wool has only followed the course of all produce, and whether the general decline is the result of monometallism or other causes, there is no reason to suppose the deprea*

sion is permanent, while the statistical position- of wool entitles it to immediate «ad substantial participation in any revival of trade,. PROSPECTS OF A REVIVAL, Signs are not wanting that revival la already being felt, nor can the outlook 'for the current year be regarded unifavcteirably. Unquestionably the chief factor is the United States. For two years uncertainty 9'a to the tariff has crippled its trade, how materially is shown, by the following statistics published in an annual review of 4he trade by the Boston Commercial Bulletin :— ** The wool production for 1895 is estimated at nearly 60,000,0001 b greasy less than in 1893, equal to about 150,000 bales Australian. Stocks on hand at the close of 1894 show a decrease compared with 1893 of 11,400,0001 b. Imports of "Wool for the ten months ending October 1892, 1893, 1894, were 140,175,1141 b, 106,239,2291 b, and 84,664,2351 b respectively, a ; decrease in two years of f> 5,510,8791 b. Imports of woollen goods for the same periods (in dollars value) i—1892, 32,758,099d01; 1893,28,651»645d01; and 1894, 14,014,890d01, a decline of 18,743,209d0L While the stagnation in American markets has existed, in other directions ample business has been found, and although at weak rates the industry is generally well employed. The position has a manifest undertone of strength, and with the influence of low prices tending alike to restfict" production where" conditions fender iti unprofitable and to increase consumption, some improvement in wool values cannot long he delayed." Where the wool goes to is always a matter of interest to Australian pastoralistei In 1894 the wool production of the Australian, colonics (excepting New Zealand) was 1,529,941 bales, of which 768,782, or 50 per cento,, were sold in the colonies. The destination of this wool was the home trade, 25f percent.; the Continent, 57 per cent.; America, 5f per cent.; Jappja, India and China, £ per cent.; arid local manufacturers and speculators, 11per cent. i

Imports'of s 1892. Bales. 1893. Biles. | 1894. Bales. Australasian and - Cape 2,126,000 2,074,000 2,152,000 River Plate .. 415, 00 -- 4J4.000 443.000 1 Other sorts 497,000 476.000 407,000 Home ProductionBritish production (iu equivalent of colonial bales) C50.CO0 638,000 600/00 United States (ditto) Total supplies avail823.00J 900.000' 826,000 able 4,511.000 4,502,000 4,518 t 00O