WOOL PRICES

Otago Daily Times, Issue 26043, 5 January 1946, Page 2

WOOL PRICES

The Farm

WORLD MARKET FUTURE CONTROLS UNNECESSARY FEARS Woolgrowers may appear to have reason to be apprehensive with respect to the cable message from London published this week, suggesting that marketing conditions in the future are likely to be complicated, if not actually compromised, by the arrangements existing at the present time fqr the resumption of auction selling in grower countries, and the admission of foreign buyers to the market on free and open terms. Actually this is not the case. The Empire Joint Wool Organisation, membership of which is fixed and determined (although the cable message said that it was still unknown), has not yet come into active existence, but provision has been made for a proper handling of wool transactions for contributing countries in terms of the organisation’s functions, until the new body comes into complete operation. The Auction System Membership of the Joint Organisation was announced very definitely many months ago, not only by cablegram from London but also verbally to a representative of the Otago Daily Times by Mr B. H. Wilsdon, Director of the British Wool Industries Research Association, who visited Dunedin in an official capacity three months ago. It was stated last year that the member countries of the organisation would be Great Britain. Australia, South Africa and New Zealand, and it was disclosed at the same time that the method of wool disposal in grower countries would revert to the competitive system of sale by auction. It was not intended then, nor is it proposed at the moment that foreign operators should go out to grower countries and compete on terms disadvantageous to member countries of the organisation. * Sale by auction will be carefully regulated in terms of the specific arrangements that are at present being designed by the Joint Organisation, with additional safeguards for growers in the form of a guaranteed minimum price, which fortunately has no Government or official flavour. It has been definitely decided that auction selling shall be resumed in New Zealand for, the 1946-47 season, and if Bradford interests are concerned at the present time as to the conditions under which their representatives will operate not only at New Zealand sales, but at auctions in Australia and South Africa as well, it is mainly because the Empire Joint Organisation has not yet formulated the policy under which it will guarantee a minimum return to growers and at the same time safeguard the interests of consuming purchasers. A Minimum Reserve The tentative system of sale already agreed to in the name of, if not actually by an actual organisation provides for a minimum reserve price on all wool fixed by the authorities comprising the membership of the Empire Joint Organisation. The present average price of 14.0875 d per lb will continue until June 30, 1946, after which it is proposed that the method of appraisal shall be abandoned. Subsequent to that date the fixed minimum reserve will be used as a basis for sale by auction. This price, although not definite at the moment, is considerably in excess of 13d. If a grower’s clip fetches more than the fixed minimum reserve it will be paid for at the value at which the wool is sold, but if the highest offer at auction does not reach the level of the reserve, the grower will have the option of accepting the price bid, plus the Joint Organisation’s subsidy, or putting his wool up to auction again at a subsequent sale. The Empire Joint Wool Organisation is a vigorous and effective body set up for the protection of Empire wool growers and consumers, and it is not to be thought of that its functions or operations will in any way jeopardise the welfare of the ■ interests •in whose behalf it has been set up, to the advantage of foreign textile industries, which through war conditions and the need for rehabilitation at any cost, might be inclined to compromise British markets for the raw material.