SUBSTANTIAL PROFIT

Otago Daily Times, Issue 27018, 1 March 1949, Page 5

SUBSTANTIAL PROFIT

UK AND DOMINION WOOL DISPOSALS WAR-TIME SURPLUS STOCKS NZPA—Special Correspondent Rec. 8.40 p.m. LONDON, Feb. 28. Nearly £32,000,000 profit for the United Kingdom and dominion Governments has resulted from the disposal of the war-time surplus of dominion wool up to June, 1947. This emerges from the first accounts of the United Kingdom and Dominion Wool Disposals, Limited, set up by the Governments of Britain, Australia, South Africa and New Zealand to carry out the orderly liquidation of large war-time wool accumulations simultaneously with the marketing of current production. The accounts for the 23 months from August 1, 1945, to June 30, 1947, show that the initial stock taken over by the Joint Organisation, including the 1945-46 clips, was 14,951,000 bales at an original cost of £245,776,622. At June, 1947, the Orfanisation held a stock of 4,515,000 ales at an original cost of £64,169,258, and the net profit resulting from the first 23 months of its activities was £31,926,383. Since that date, stock liquidation has continued at a rapid rate and if the current season’s selling programme is carried out as scheduled the Organisation’s stock at June next year will be down to about 1,750,000 bales, mostly in inferior sorts. No estimate can be made of the profits realised since June, 1947, but as wool values have advanced a further substantial profit is to be assumed. This magnificent result reflects the great world demand for wool which followed the war. It has been achieved not by any restrictive policy of offerings but by feeding an open market with the maximum quantities it could absorb. An official comment on the result says: “The Joint Organisation is satisfied that the total amount of wool on offer has, up to the present, been sufficient to match the full capacity of the mills and to allow for the maintenance of trade stocks at a reasonable level.

“In a period of more stable general price levels, the adjustment of supply to demand which has been achieved would have kept wool prices more steady although it would not have prevented some increase for merino wool because of its relative scarcity.”