POST COMMANDEER TRADE IN WOOL

Otago Witness, Issue 3443, 9 March 1920, Page 10

POST COMMANDEER TRADE IN WOOL

The following cables, which have passed between the Prime Minister and the. Director of Ra/r Materials, London, speak for themselves: — From the Prime Minister: —"Dominion woolgrower3, banking and iinancial institutions, and woolbrokers greatly concerned regarding position on return to free market conditions for wool. While'it is hoped that your published forecast that all wool purchased on behalf of the Imperial Government will be slapped hence by December 31 next will be realised and the relief thus afforded will be fully appreciated, it is re-, cognised that thLs- does not eliminate all dangers as regards, marketing coming clip 1920-21. It is feared that unless arrangen.ents can be made whereby the large accumulation of wool on account of Imperial Government is a prevented from coming into undue competition with the coming clip, grave complications will arise resulting in serious fall in values and consequent financial embarrassment to wool growers and New Zealand Government. I trust that you will formulate some scheme providing for protection of all concerned in wool industry on this side, which I can submit for confirmation here." , Reply from the Director of Raw Materials, London: —"Your telegram No. 398 has had cur careful attention. Owing to great delays in turning round steamers and owing to Shipping Controller having diverted space from wool to wheat, it will be difficult for me to maintain shipments on sufficiently large scale to lift all Government wool tills year. However, will make every effort to do so, and in any case to reduce carry oyer to smallest possible quantity. We agree that the position of growers of new wool depends principally not on whether Government surplus is stored in New Zealand, but or. total quantity left and the arrangements made for the disposal of it. You "need not have fear regarding" woOM

from 48s upwards, which will ■be readily sold at good profit" almost as rapidly as they come to hand. % 46s are in fairly good demand at prices showing very little margin over appraisement value. We think that our surplus of official qualities at end of yeur will probably be very little and need not causo serious concern. Wool below 46s is selling slowly ar.d poorly in spite of being relatively so very much cheaper than finer wool. Ido not think that reducing our selling limits below equivalent of appraisement prices would substantially increase our sales. Unless demand materially improves there will be considerable surplus of coarse crossbreds, both New Zealand and Australian, carried over at end of year, at which time expect our surplus stocks to consist almost entirely of these low grades. Unless you have "some suggestions to make we see nothing to be done but to continue on present lines supplying market freely with every grade of wool, but not attempting to force wool into speculative hands by cutting prices of unpopular grades severely. Shall be glad sre months hence, when situation has developed further, to agree with you on any feasible plan for combined action. You need not fear our attempting to force sales _ by cutting prices without consultation with you."