THE WOOL-SELLING SEASON

Otago Daily Times, Issue 22911, 19 June 1936, Page 4

THE WOOL-SELLING SEASON

WINTER SHOW AND RACING CARNIVAL

WELCOME INCREASE IN VALUES

DOMINION REALISATION OF £9,840,427

OTAGO CHEQUE TOTALS £1,657,029

For so essentially a pastoral province as Otago, the most vital feature of the season that has. just closed was the marked improvement not only in wool prices, but in market conditions generally. The entire outlook has been altered during the past nine months, and although all classes of farmers have reason to look to the future with greatly renewed hopes, the sheep farmer is Especially blessed with good prospects. . Wool sales in the Dominion closed on a firm note, and in addition lamb and mutton prices have showed some welcome movement in the right direction. The situation is definitely brighter than when it was summarised in the Winter Show issue of last year. This time twelve months ago the farming community was living entirely on hopes, with a very real fear of a -possible recurrence of the loav rates for wool which reduced the Dominion’s wool cheque for the year to below the £5,000,000 mark.. To-day well-founded expectations concerning the future, combined with the realisation of greatly increased values in the season just concluded, have put fresh heart into the sheep owner.

MARKET CONDITIONS The 1935-36 wool selling season was a particularly busy one in New Zealand,. In all centres the quantities of wool available for auction showed a heavy increase on the previous season’s figures, due in no small measure to a heavy proportion of held-over supplies which were disposed of at the first’sales, frequently to the exclusion of the new season’s clip. In Otago the season opened with a December sale at which the offering was nearly double that of the corresponding auction in 1934, and the returns of actual sales reached the large total of 28,269 bales. At the three succeeding sales the catalogues were all larger than in the previous year, and at the close of the selling season it was found

that the total quantity of wool sold came to 111,332 bales, compared with only 73,558 bales in the 1934-35 season. That this state of affairs was not confined to the Otago province is shown by the figures for the whole Dominion, which were 265,942 bales in excess of the previous figures. In the 1934-35 season the sales totalled 471,512 bales, and for the season just closed the figure was 737,454 bales. With increased quantities of wool offering and higher rates ruling, both the buying and selling sections of the industry in New Zealand were working at high tension throughout the season, and as a result a constant flow of money from wool was being put into circulation, estimated at more than £1,000,000 a month. There were no very outstanding features in the market. Perhaps the most notable was the steadiness of the demand for fine wools of all descriptions. Price fluctuations were very few over the season, and occurred within a very limited range, A sharp increase in the value of crossbVed wools, even the coarser descriptions, had a marked influence on the result of the season’s sales, but the improvement of the earlier part of the season did not develop exactly as it was hoped. The most satisfactory aspect of the season from the broader viewpoint of world conditions, however, is that, for the time being at least, consumption appears to have overtaken, and, up to a point, outstripped supplies. The United Kingdom stock and import figures as supplied throughout the season revealed a new low level in stocks. America’s entry into the market for raw materials has had a good deal to do with this, and taken in conjunction with Continental activity from beginning to end of the season and a keen Japanese demand, it gives justification for the firm view held by the trade in New Zealand that the wool market is statistically sounder than has been the case for many seasons past. And this in spite of the tremendous developments that have taken place lately with regard to the manufacture of substitutes and artificial fibres. It is in this healthy market condition that the real hope for the future of wool lies. It has been highly satisfactory for the Dominion to receive this year a wool cheque twice as large as that of the previous season, but what is more gratifying is to know that market conditions at the close of the season all point to a continuance of a level of values that are nearer a payable basis than has been the case since the difficult years of depression began.

THE OTAGO AUCTIONS The improved position during the past season in Otago, where four main auctions were held, is clearly illustrated by a comparison between the sales and realisations for the past two seasons. Even allowing for increased rjuantities sold during the 1935-36 season, the outcome of the pastoral year is considerably better than for the past four or the eeasons. The figures are as follows: —

The average price per bale in Otago for the four sales was £l4 17s fid, compared with the Dominion average for the season of £l3 6s lOd. The mean price per pound in Otago was 10.63 d, as against a New Zealand average of 9.14 d. The average price per pound for the previous season was 7.64 d in Otago and 6.5 d for New Zealand, the per bale averages being £lO 10s 8d in Otago in 1934-35 and £9 6s 8d for the whole Dominion.

EIGHT YEARS’ COMPARISON Illustrating the price movements in the wool market throughout the years of the depression and back to the last year of profitable wool ▼alues, the following table, which covers the period from 1928-29 up

1035-30. 1034-35. December 28.200 bales 15.700 bales February 20,005 bales 24.002 bales March 27.000 hales 23,130 bales April 25,159 bales 10,507 bales December ,. £305,020 £108,017 February .. £473,347 £207.523 March ,. £440,240 £230,000 April .. £342,415 £110,000 Total for season .. £1,057,020 £770,241