OUTLOOK FOR WOOL

Otago Daily Times, Issue 23517, 3 June 1938, Page 21

OUTLOOK FOR WOOL

ENCOURAGING POINTS HEALTHY CONTINENTAL DEMAND (From Our Own Correspondent) (By Air Mail) LONDON, May 11. While the world’s rate of wod consumption is not as high as it might be to-day, there are one or two encouraging points to be observed (states the Yorkshire Post). “In international politics, ..or example, some of the more immediate causes of tension have been relieved in a measure, as witness the AngloItalian Agreement," it is observed. “ Recent political and financial developments in France also are calculated to achieve a degree of stability to replace the acute uncertainty which has existed for so long. Within the trade itself, some early misgivings, arising from fears of wool surpluses which might be an embarrassment to values, are now removed by later informsftion, which shows that remaining supplies of the world’s exportable wool are moving with considerable freedom from first hands, and one of the bright features of the situation is the healthy demand coming forward from some of the less well-to-do Continental countries.' “ This is helping, at any rate. -to make good the deficiencies in the buying of certain ordinarily large wool importing countries; for Russia. Italy, and Germany are all endeavouring to finance larger wool purchases, and although continuity of import trade m Austria is presenting some difficulties since the constitutional changes an ultimate expansion is expected under the new regime. HOME TRADE PROBLEMS “ It is difficult for the trade at Home to be unreservedly optimistic, however. so long as machinery activity continues to fall short of a wellemployed standard. It is impossible to overlook that during recent months the averave rate of production in the wool textile industry of the United Kingdom leaves a good deal to be desired. The winter season for heavy woollens was not good, from the viewpoint of the manufacturer at any rate, and the spring season for worsteds and light-weight woollens has been similarly disappointing in volume. “It would seem that the heavy rate of production and ordering in the period preceding June last year—and encouraged by expectations of a Coronation year trade which were not completely fulfilled—has resulted in accumulations of stocks and contracts, the liquidation of which has had an inevitable effect on the subsequent rate of production. “ There is reason to believe, however. that the industry is steadily recovering from this admittedly awkward situation, for accumulations of stock ire being gradually absorbed, and dearer contracts for partly-manu-factured goods are being taken up in a manner which few firms find cause for complaint in the circumstances."