MERINO WOOL-PRICES AND PROSPECTS.

Otago Witness, Issue 2524, 30 July 1902, Page 6

MERINO WOOL-PRICES AND PROSPECT S.

The present position and prices of merino wool in London and colonial markets clearly mdicate the confidence which buyers have in the future, and competent authorities go the length of predicting higher lates for the staple, in vifw of its growing scarcity, with no prospect of any increase in supplies :or a considerable lime to come. A London authority, writing on the results of the May sales, says: --"Men would not be paying such long prices for merinos if they did not anticipate a full continuance of to-day's rate- : in fact, I can haidly reMit saying that higher prices still are in store for New South Wales woolgrowers. Nobody wants to pee repeated the ha-sco of three years Ego, and as present consumptive requirements are so large and .supplies to limited. I can see no reason why to-day's . prices will not 'be fully maintained, while] there is a strong probability of a fui ther j inciease before many months hence. lie- | garding the progressive advance in pi ices , of merino staples the writer of the "Wool Report, in the Town and Country Journal, ) Sydney, says: — ■''From its lowest point in 1900 merino wool has already crept up a, long way in the following stage* . — During 1901 10 per cent. F.rst series, 1902 .. 5 per cent. Second series, 1902 .. 5 to 7i per cent. Third series, 1902 .. 1\ to 10 per cent. So that in 18 months a remaikable lecovery from the 1900 disasteis has taken, place, a lecovery which at one tune was looked upon as impossible, in consequence of the distressed condition of the trade, and, natuldlly, plenty of warnings appear :n European journals not to overdo the recovery." We gladly quote anothti English .tuthor, because in reviewing the position of the trade from various points of View. this wiitor conse^s ;i modicum of a c vjtance of better t ; me>- for a giowei of iinelui it-d ctfi-x-biecl wool- Commenting upon the opening of the .May «-r.ks m London, when tli'ie v,^ ,'ii ..d wince in ultimo^ of j 7£ i?<Jj cent, to 10 pei- <&z&,. ts wj»_: .—

"It mu-t be admitted that the present per es of sale 5 ; have opened very auspiciously, and in view of the visible supplies ar.d the active condition of trade in consuming centre^, the present rise, in my opinion, is iu'tifieil While the scarcity of an artkle is not the only factoi m regulating its price, it is nevertheless an important element in the situation, and there can be no doubt that fine v.ools bid fair to be somewhat scarce for some years to come, the Australian drought still being umelieved aud crossing frr mutton pvoeefdiii'T wherever possible. But ii nm-t b3 lememberecl that the st ittsf.L\il posimni of „:i article i< not a miiv uilerion of h\^h prices, and it w.i- ex." tly on thi^ point that the wool tv;id^ in 1899 suffered shipwreck. The question ]>- : To what extent will the purehci-i' p<r/,cr of the woiUl admit of an advance m fin o -wo A quotation-? Duiii"c the bhun of 1899 the large majonty of \»onl v n held the ground that tho purchi'z-ing power of the masv>s was on the whole, a negligible factor, the only Lil tor entitled to cn^ideiation being the «'ze of the stocks of \v<-01. The error of this view was demonstrated in iath'-r too drastic a manner to bu palatable, and I'diimo of thi- 1 raise the danger &.igna.l In time. v. sth the hope of it being heeded. It is icloh tble at this juncture to entertain the opinion that ■ merinos and the prices they are now making aie justified ; but whether they will advance to anything like the extent that some persons now think likely is to be veiy gravely questioned. I strongly deprecate duy spirit of speculation. Lee wool men remember the fact that fi'biic buyer* are fully cognisant of the lhe that has already taken place, but have almost unanimously vowed to resist paving any material advance on woven fabrics. Ho long as medium crossbreds lemain at their present level they ;.re bound to be a menace to high prices for merinos, and if fine fabrics are advanced lower qualities will be largely substituted, as was the" case towards the end of 1899. As a mattei of fact the present situa-tion and general tendency of wool values suggest caution, and seem to w.tiji the trade not to Hi-h matters unduly, but to allow prices to iippici 1 <'te gradually, as actual consump* ive 1 equ rements dictate. If this policy be adopted, instead of the present good tij/'le in Bradford, Roubaix an 1 America being extinguished, it will stimulate enteipii.se, stiengthen the market, quicken inquiry, and the range of prices then established will be likely to become .safely fixed." Because of the disastrous, drought there mu=t be an enormous s-hrinkage in production this season of Australian merino wool. New South Wales is by far the largest producer of this particular staple, and at the annual meeting of the New South Wales Sheepbreeders. 1 Association, held a few weeks back, in moving the adoption of the annual repoit, the president referred to "the great disaster in the continued drought that had befallen the pastoral industries. In a few years the number of sheep in the State had declined from nearly 70,000.000 to 41.000.000, which was the total of the State's shiep at the beginning of the present year. But in spite of all they had suffered in the way of drought, he did not think they were at the end i-f theii ti.^uble He did not wish to be pessimi^tif. vet he thought it w,t« well that the tiuth of the position .should be known, and that the people should understand how the pastoral indu^tiy was suffering. Having started the present year with a. little o\er 40.000.000 sheep, he thought they wnuld get veiy well out of it if they Lushed the year with 20,000,000. He made this statement after conversation with many practicaiThen. This fact, taken wi^h the loss of all the lamb«, would mean th-it, (hiring the present j-ear the State would lo«,e 40,000,000."' Then, again, the heavy losce-j in Queensland and South Australia have to be taken into account, .so tint no one «.'n s-ny how much or how little wool theie will* be in the coming season.