London Wool Sales

Southland Times, Issue 12124, 2 May 1908, Page 2 (Supplement)

London Wool Sales

A POOR START—ANOTHER SERIOUS PALL IN ALL QUALITIES. (From Our Special Correspondent.) LONDON, March 20. All eyes are now upon Coleman Street, and I have never known a time when there was so mucli interest manifest over tho course of wool prices. ? tinvc lately thought that men were as anxious and as much concerned when prices wore low as when values were high, for everybody seems desirous of knowing tiro fate of the raw material. Tho interval lias been the most disastrous that we have seen since 1900, every quality falling considerably. It is impossible for markets to stand still. Tilings have about reached that point during tho past two months as to alarm everybody, for every transaction has shown a lower price accepted. It is really disgusting to see men spend their time and money in buying an article In the hope of making a living profit, and then to find that everything i.s against them. Tho money recently lost in tiie wool trade is tremendous, and it will never be known what parties have suffered the most. I hardly think that values would have dropped like they have if the trade had not been confronted with such heavy supplies, all of which have to be lifted and financed. It is at a time like this when the question should bp seriously considered of giving a longer time to the marketing of the Australian clip in particular. It’s all right enough rushing a million bales on the market In throe or four months' time when trade is booming, but when wo encounter a time like the present, it Is bad any end up. Bow Values Have fallen. The course of markets in consuming centres like Bradford always plays an important part in determining what Coleman Street is going to do. and I must say that the outlook is nothing like what \vc have been accuatomeu to during recent years. Last December, with the American financial crisis, things were very unsatisfactory ; January was worse, and expectations are still less favourable over the March

series. The following table is well worth considering, showing as it does what has been the fall In Bradford for good standard descriptions since the close of the last series :

Feb. 7. Mar. 17. d. d. d. d. 80’s colonial tops 29%-30 70’s ~ ~ 28 -28% 26%-27 64’a 26%-27 25 -25% 64’s Cape ”, 26 -26% 2*%-25 60’s colonial, sup 26 -26% |4%-25 60’s ordinary 25 -25%- 24%-25% 58’s „ average 23 -23% 22%-23» 66’s 22 -22% 20%-21 go’s :: :: w -w% i«%-i7 46’s ~ prepared 16 -16% 13%-14 36’a 12%-12% 10%-U 32’s „ ~ 12 -12% 10 -11

It might be Interesting to know that when the March series began a year ago 70’s colonial tops were well worth 29d, super 60’s 27% d, and 40’s 1 7V6d, and In the opinion of some experts the latter were to go to 20d by the middle of the year. The transformation In wool prices has been thorough, and there Is no comparison between manufacturing conditions to-day and what obtained 12 months ago. It does Indeed seem strange that the whole Industry should find itself at this moment in such a slate of utter collapse, for both fright and fear seem to be entirely dominating the whole situation. How far this Is justified remains to bo seen. Perhaps Coleman Street will show where the raw material actually stonds, and generate a stronger feeling of confidence. A Blizzard Ahead. The above was written before I left home for London to be In readiness for the opening of the second series, which commenced last Tuesday. The usual contingent left Bradford by the after- , noon trains, but from conversation with acquaintances it was plain to ho seen that no one was in good fettle for the sales. Still, many of us must go even if we want little wool. Nothing struck mo more as I went round valuing on Tuesday morning than the absence of familiar faces, plenty stopping at home till they saw how things shaped. The offerings this series is 200,000 bales, and not since the July sales in 1902 have we had such a large quantity. The quality is about equally divided between merinos and crossbreds, and more titan sufficient to satisfy all sections of the trade. The pity is that users are not keener, but then plenty of wool bought in January last has not yet left London, and witli prices dropping, a very undecided feeling is uppermost in all members of the trade. Before I left home an old member of the trade with a record of -15 year’ experience at the back of him said that he discerned signs of the worst " blizzard ” in wool prices that lie had soon in all his life—not a very inspiring thought to set off with. Flat Opening. The three catalogues submitted on the opening day wore rather poor, neither the merinos nor crossbreds being up to the mark. Evidently selling brokers were not in a humour to submit their best clips till they saw how things were going to shape. The fine wools lacked style and character, while the crossbreds were nearly all llt-tlo fanners' clips from New Zealand, It is more than ever manifest that less skirting Is being done, and carelessness was everywhere manifest. lam certain that many growers will have a rude awakening when they get to know what their last clip sold at. Punctually at 4 p.m. the sale began, and bids came slow. Evidently cautiousness was the line of action for everyone, competition being limited and spasmodic. Only the home trade was in evidence, and but for Bradford the “show" would have been a very tame affair. As it was, there was nothing of that life and "vim” about the room that we have seen for years back, and I called the opening a very flat one. The Continent did next to nothing—both Franco and Germany being practically spectators. America represented by some eight buyers —was simply an unlooker, ttie wools on offer being hardly good eaough for that quarter. When compared with the close of last series, the following changes wore seen ;

Combing merinos %d to Id decline. Faulty merinos llid to 2d decline Fine crossbreds Id decline

Medium crossbreds Id to IVid decline Coarse crossbreds Id to l%d decline Best slipes Vad to Id decline Short, faulty slipes Id to 2d decline The decline was most pronounced in all faulty wools, especially scoureds, and these oftentimes were down 2d per lb. There seems to be little call for shabby, burry, wasly wools of an extract character. The dingy crossbreds were all down per lb, though the light and bright parcels sold at within Id of last sale’s rates. These results were Just about what were expected, and to colonial growers they are bound to be very disappointing. Tliere is not a souna feature anywhere, and I am only afraid that things will get worse before better. Bradford firms and brokers who wore heavy buyers last series did practically nothing on the opening day, and the sale passed off without inspiring anybody.

The second day’s sale brought out a belter selection of wool, more variety, but no better bidding took place. The saleroom, was quite as full, but the bidding lacked animation, and seldom did it reacli anything like the high character that, one is accustomed to. There is on the part of everyone too much of the spirit of fear and want of confidence to inspire anyone to do liis best, and only tlie very lightest parcels command real serious attention. The Continental trade has been a little more active than on the opening night, but neither Germany nor France is taking Us share of wool. American buyers might as well be at homo as here for what they leave done so far. Opening prices are lust about maintained, but no more. .'Brokers hardly know what to make of the situation, and I should not be surprised to see both a curtailment of selling days and quantity as well. It scorns to me foolish to force wool on t;o an unwilling market, and wiiilc I never believe in carrying forward heavy stocks, still at a time like this tlierp seems to be no other alternative. The trade Itself could very well have done without any series at all, but the wool is here and some at least nmist bo sold. To see prices fall another Id to 2d per lb must indeed be galling to all coiusignors.

Tlie Outlook. Messrs H. Daw.uon and Co., in speaking about the outlook, say : “ The interval has been onoi of unalleviated dullness and stagnation. Distrust and pessimism have apparently possessed every branch of the industry. The depression lias been aggravated in various ways botli by disinterested sensaticta-mongers and by interested s peculators. The result has been a serious restriction of business and decreased consumption in every branch of the industry ; while so far as crossbrcdls are concerned a veritable dry rot in values has ensued. “ There can only bo one way out of such a ditch towards that confidence which ensures a free demand, and that is by the way of cheap wool and cheap money. Happily there has already been rapid progress made in that direction since the Now Year.. The sensational shrinkage of values ;ln crossbreds Indicates that we have travelled a long way towards safe ground, and it Is not easy to believe that wo have much further to go. The new llevel cannot fail to stimulate demand In many directions, if slowly, still surely. Alongside with this, money Is now cheapo, and this will bring welcome relief to tliose who carry stock, and will enable the many who have acted with zealous caution to operate more freely. " Speaking of merinos, the position has been much better sustained. It has been a fortunate thing for the industry that there were h.ungry machines waiting for the early and highpriced purchases made at the .beginning of the colonial season. Those have practically gone out of sight at a minimum of loss to the topmakeiTs and spinners. " The apprehension and mistrust appears to centre In the future rather than in any serious burdens that have

to be carried at the moment. The caution which nao characterised the flue wool branch for the past twelve,months has been a great safeguard against collapse and disaster, and to-day this hand-to-mouth policy still obtains. Those who have been latterly actively "bearing” the terminal markets, by seining freely at low prices, will probably be forced to operate In faulty combing sorts at the present series, and this is a factor that mev help to strengthen the merino market at Its weakest point.

“ In the nervous state of the Industry there has been an unreasoning concern about 1 the larger offerings In London. It Is perhaps unnecessary to emphasise that this does not mean an Increased Australian production for the year. Most Australian houses forecast a decrease, and Messrs Dalgety and Co. estimate It at 40,000 bales. Our correspondents place It at as high 70,000 bales. Anyhow, the enlarged list for London is simply a transference from the colonial markets, where the decreased sales this season, against the last one, will probably be about 150,000 bales. Taking Messrs Dalgety and Co.’s figures, there will thus be 110,000 bales moD wool to be ottered In London a mol«ot of this has, of course, passed the hammer already.”