OBSCURE OUTLOOK

New Zealand Times, Volume XLVIII, Issue 11046, 1 November 1921, Page 6

OBSCURE OUTLOOK

THE WOOL INDUSTRY BUYERS CAUTIOUS OVER FUTURE BUSINESS. GERMANY’S ACTIVITY. By Telegraph—Press Assn.—Copyright. Australian and N.Z. Cable Association. LONDON, October 39. A prominent member of the wool trade says the outlook for the new year is somewhat obscure. Buyers are adopting a cautious policy for future business. The recent advance has been too large and too rapid for absolute confidence. Margins of profit are impossible under present conditions, and values of the manufactured product and raw,wool do not meet the manufacturers’ complaint that the advance has checked new business, although a few weeks ago there were hopes of a new order on the basis of 42d for 64’s. The conditions prevailing and the price of goods at the end of the trade year are still far from satisfactory. The advance in the price of wool will, however, help towards a better liquidation of old stocks, although it hinders new business. Meanwhile manufacturers are still squeezed between the millstones of high cost of production here and low prices offered by competitors abroad. The most remarkable feature of the London series of wool sales just closed has been the absorption, proportionately, of large offerings of crossbreds, to which both the Home and foreign buyefs contributed. The only explanation of the broadening competition for crossbreds and their relative cheapness, which is creating a demand and encouraging confidence, is .Germany’s firmness in securing supplies, which is amazing. Germany has taken in direct imports from South America, during the year ended Sep tern her 30th, 134,000 bales. This, in the aggregate, is higher than any quantity taken by any other country. The German mills are better placed with orders than any other country, and they have refused new business. Their future looks . rosy, bnt it depends entirely on the aihility to struggle through acute financial difficulties. It is evident that lack of confidence in the’ mark is the inducement to many to invest in raw materials, especially in view of the good trade experienced. The least satisfactory feature in the home woollen trade is the position of the manufacturer and the merchant of piece goods. The financial difficulties are, however, less acute, and are gradually being alleviated, but the promise of a' real revival is not yet materialised.