MAGNIFICENT GESTURE

Otago Daily Times, Issue 27058, 18 April 1949, Page 6

MAGNIFICENT GESTURE

WOOL STABILISATION ACTION BY PRODUCERS “As is universally known, wool producers in New Zealand and South Africa have indicated that they are prepared to leave all the divisible profits that might accrue out of the present disposals plan, as well as the reserves of a very substantial contributory charge, in a fund to be used for the stabilisation of wool marketing when the present wopl disposals plan is completed. I claim that this is probably one of the most magnificent gestures ever made by any section of primary producers,” declared Mr J. H. Moolm'an, chairman of the South African Wopl Board, in a broadcast address last night. “Producers might reasonably have asked for the distribution of a portion of their divisible profits and left posterity to build up these reserves in subsequent years, instead of holding these substantial amounts, but by doing this producers have indicated in no uncertain terms that they are not prepared to revert to the pre-war haphazard system of wool marketing.” Mr Moolman said that the minds of' producers in every dominion were now being taxed to evolve a wool stabilisation scheme to ~ operate when the present scheme lapsed. The experience gained during the existing scheme should certainly be of tremendous benefit. Although not too much buying in was done, it was certainly sufficient, particularly in New Zealand, to realise what a steadying influence the stabilisation scheme had had on the market and what confidence it haa engendered, not only with producers, but also with buyers and manufacturers. \ __ _ “ The recent decline in the New Zealand wool prices while at the same time London prices were hardening for New Zealand wools just goes to prove all over again how nervous the wool market can be," Mr Moolman said. “ Fouroenee per pound of wool means a loss of £5 per bale to the producer, and £SOO less for 100 bales of wool would substantially upset any possible calculations or profit. “ When I refer to stabilising the wool market by providing an economic protected reserve I fully appreciate that such a protective reserve must always bear a close relationship) to the average primary commodity price, but this also means that the .very sharp curves that we have had in the wool market in the pre-war days could be straightened out to a degree, thus obvi-ating-the possibility of temporary landslides such as the producer has experienced to his regret many a “If somebody should ask whether we are thinking of consulting the consumer in the fixation of a reseive price ” be concluded. “ then I can say that T have no doubt whatsoever in mv mind that, provided a stabilisation scheme keeps this factor of geneial price levels in mind, and provided that any organisation created for wool marketing has adequate consumer representation on its board, a scheme can be evolved which will be of great benefit to the producer, manufacturer, and consumer alike.”