Colonial Wool.

Timaru Herald, Volume XIC, Issue 13367, 17 August 1907, Page 3 (Supplement)

Colonial Wool.

WHERE SHOULD IT BE SOLD? LOCALLY OK IX LONDON. On llu- 17lh of June "The Times." London, published an article (from a correspondent) upon the relative merits of the London and colonial wool markets. It is not stated who the correspondent is, but after pausing the article—which, by tile war. introduces no evidence in favour of selling wool in London—the Melbourne "Argue" is compelled to form the conclusion that the writer Ls connected with a London woolbroking firm, which lias waked up to the fact that they have lost the handling of the Australasian clip. It is only natural that, the London brokers should* make an effort to regain their lost business. tha extraordinary thing is that ihey have not attempted to get in touch with sellers and buyers long ago, but to use a colloquial expression, they are on a bad wicket, and they can produce no argument to prove to growers that it would pay them to revert to the obsolete system of .stripping their wool to London for sale. "The Times" article is very, similar to a circular published by one of the London firms, inasmuch that practically the only figures produced are those showing the average value of a bale of wool in Austraku-ia and London for the last five years—a longer period is not taken because, their own argument would be disproved. It was pointed out in "The Ar-. guo" as long ago as the Ist of April last that tho average value per bale is no criterion as to the relative merits of mar-k-sits. For instance, dealing with wool, it is as well to point out that that commodity should always average pounds sterling more per bale in London than in Australasia, because — 1. The extra cost of marketing in London amounts to, on the- average, quite 25s per bale. 2. Tho proportion of scoured wool sold in London is threa times as great as it. is in Australasia. 3. That portion of the clip which is sent -to London tor sale is composed of straight line? of station clips, the lower qualities, such as third lambs', stained pkees, locks, mixed bales, etc., of same being sold in Australia. 4. A very large percentage of the tola! sold in Australia is composed of farmers' wools, many lots, of which.are more- or less unclaosed, burry, and unattractive. .■■•-• 5. - The average weight per bale of the Xvool sold in Australia is about 251b. lighter than those from Australasia which' are sent to London for tion,'becaui-e-^-•(a) Ar large proportion of the Queensland clip is shipped, and it is the-custom to put more wool into a -.bale in that 'skit? than it is in the ]\, other slates. (b) The farmers and amaller growers, whose wool is all sold in Australasia, make their bales comparatively light, thousands and thousands of the bales not going through a press at all.

Another thing, ib would be most interesting to know how the average is arrived at in London. The recognised authorities, Messr.?. Helmuth Schwartz and Co., in their annual review, dated 9th January last state:—"The following gives the yearly total value since 1895 of the colonial supply based upou fairly trnstwortlij Shverage value per bale." Cape bales are •included, and probably Falkland Mand, 'Punta Arenas, and River Plate, and as 'the average weight of,such wools is 475 'kilos, or say, 10471b., as against 3401b., which .is about, the average weight per bale of all the wool isold in Australasia, it will at once be recognised that comparisons as. to the average value realised for a bale of w.ool..in'London and Australasia are, io say the leact, misleading. Last year there vjjto some 80,000 bales of tue wools named sold in London. If, as "The Times" article and certain 'London brokers -endeavour to show, the 'London wool market is so much- greats; 'than other—that the ; average value realised per bale is pounds sterling above the Australasian average—surely manu fat'turers do not know their business if they continue to purchase any -wool at all in tho former centre; while selling and buying brokers are surely -wasting valuable time working for small commissions if thev could by expending very much less time and energy, quickly make huge fortune: by buying wool in Australasia and reselling in London. Why also do wool experts continue 'to -work for a salary if they could make money by speculating in tho- manner stated. '.'To state that a bale of wool, of equal weight, etc., nets so much more money to the .sailer if disposed of at London sale: than it would if sold in Australasia is surely to cast a reflection upon the judg-ment-of the trade. ° Unless the London brokers, supported •even though they may be by that great paper, "The Times," can produce some tangible reason why wool should or doer net anjmuch money to the growers if sold in London as it does in Australasia, if is most unlikely that our producers wil! speculate by shipping the coming clip for sale in London or anywhere el.rei. As was mentioned before, the Londor wool broker is o n a bad wicket, because it uuits buyers to purchase their requirements first hand at port nearest seat of production, and ship direct to port nearest mill of consumption. " It is of the greatest importance to note that direct freight to any given woolconsuming centre of the world is cbeapej than if the wool is -sent via London:- The saving is very considerable, when th wool is wanted for America or the East, but. the contention holcfc good even as regards the manufacturing centres of England. For instance, the through freight from Australia to Bradford per steamer i: at present id per lb. (the same as it is to London), whereas when the buyer purchases in London he libi>' to pay 30; per ton, equal to 3-16ths of a penny pelb. railage London to Bradford, or "if h< sejids by coastal boat to Hull, and thence per rail, the cost is £th of a penny pei pound, plus insurance.

The same arguments hold good as -regard;■ the large Continental centres, such as Rou baix, Rheims, etc, The direct freight Australia to Boston is not only on the averagi £th of ; V penny per pound, or 3-6 th. pei bale cheaper than via London, but there i the all-important consideration (especially to Americans) of saving of time. It i surely clear, therefore, that there is nnece:i?ily for our wool to be sent to Lon don, and handled at a great expense there to bo then reshipped to Dunkirk, Boston Tokio. etc., when buyeis can secure hen over 80 per cent, of the total production first hand, and ship direct. Last year the owners of 82 per cent of the Australian and 94 per cent, of thVictorian clip were content to accept val tics ruling in the Australian markets foi wool, and, as it is known that competitior centred hert- during the coming season wil be as extensive a-s ev;r, and past exper ience has demonstrated that it is the centr of the American demand, together witl the fact, that current values are acceptable, it i: not unlikely that a still greatei proportion of this year's clip will bs sole at port nearest seat of production, and shipped direct to port nearest mill of consumption. It. appears that the London brokers who w re- responsible for causing this question to b looked into have nomtriitWd «H error

of judgment, for the more the position is examined the move patent is it that Australia ii tho market- for Australian wools. Still, London is useful, in fact necessary, as a- terminal market for certain special wools, and also for speculators but the day has for ever passed when any great quantity of first-hand Australasian wools will by offered there. Tho English brokeis and journalists would, then fore, be b.tter lepaid by throwing their energies into building up a business with their own growers than by making futile attempts to recapture a business which force of circumstances has taken from •them. To Australian wool-growers and brokers ii has always been beyond undcistanding why there should bo little or no attempt toimprove the breed and get up of Britishgrown wools, and the establishment of a central market for sarnie. At present the product, from some- 30,000,000 sheep is marketed in. unsightly packages, or in a loose slate, at, country fairs generally, in an,, unskilled and unelassed condition.