HUGE WOOL PROFITS

New Zealand Times, Volume XLVI, Issue 10544, 22 March 1920, Page 5

HUGE WOOL PROFITS

SUSPICIOUS SECRECY ' ‘TRICES WHICH MADE WAR OFFICE GASP.” Som© facts about wool prices given two years ago in a review article by an authority on the subject are of interest in view of the universal attention which has been directed to the question of publishing the reports of the recent inquiry in England as to the immense profits made. Dealing with the total prices of the spinners, the writer of the article gav© tlio figures lor three grades or yarn:— In 1911 the margin of the spinner of English wool —the cheapest grade—was 6jd per pound. That is, ™ each pound ot wool turned into yarn the difference between tlio buying and selling price was 6J-d, the spinning costa and profit being met out of this. Tho profit was a penny a pound, .leaving sjd for the total production cost-. On this pre-war- profit many Bradford spinners managed to build up considerable fortunes. In October, 1917, the margin in the free civilian trade—as contrasted with the controlled prices' of Army cloth —• had increased to 2s 8d a pound, of which Is 8d was profit—the. increase at that date being, therefore, 1900 per cent, on the cheapest yarn. The margin on crossbred wool rose from 7d a pound in 1914 to 3s od in October, 1917, the increase in profit being calculated at 2700 per cent. 3000 PER CENT. The margin on Australian wool—-tho finest grade—rose from 10d in 1014 to 4s 3d in October, 1917. The increase was then 3000'por cent. What must it be at present? On this the writer of the article made khe following pungent comment: ’‘Your-wool man will tell you that excess profits duty and income-tax, are taking most of 'this huge increase away •from him. He will toll you that tho Government is compelling him to keep a large share of his machinery on war orders, upon which no such' profits are allowed Both these things are . true. Nevertheless, the civilian trade is meanwhile being plundered on .a scale which constitutes a public scandal.” If that were so in 1917, what of today, when-virtually the' whole trade has again become'civilian, and prices have advanced still further, and when people in the trade tell a long-suffer-ing community that the price of wool-' len clothes will soar higher than ever? UNDER THREATS. An interesting story was told of the British manufacturing side of the trade. In 1915 manutacturer;, finding the civilian trade more profitable than Army contracts, ‘‘demanded prices which made the War Office gasp.” The Army authorities suffered the high prices for ajtime, hut presently recured the services of “some quite competent officials who understood all about caloulaitaons ,and cloth structure.” They fixed prices and secured supplies under threats of commandeering the factories, as they did actually commandeer the raw wool supplies. They set a precedent for the Profiteering Committees by preparing, a form for tho manufacturer “to set forth in full detail all his costs ' for the goods to be made. So well was it . done that no ioophope was left for concealed profits. In a day, when the civilian trade was for goods and ready to pay any price it can be taken for granted that the manufacturer gnashed his teeth at such proceedings. Indeed, to divulge his calculations at all was sacrilege. They are so sacred that in many mills cipher is extensively used, even for weavers’ cards, in order to prevent oomoarativelv harmless information gating out.” ■ •