THE WOOL MARKET

Wanganui Chronicle, Volume 79, Issue 1, 2 January 1936, Page 11

THE WOOL MARKET

MANY FAVOURABLE FACTORS

OPTIMISTIC OUTLOOK. Surveying the outlook for the wool maikct al the time of the opening of the London bales c-u November ly, 11. -Dawson, Sons and Co., Ltd., the wellknown London wool-biokers, remarked: —The present London sales will lind the trade eager and confident. It is apparent that in most European centres, the consumption has fully overtaken the supplier, and stocks of wool in the combing mills are at a minimum level. The progress of values since the January scries of this year gives the most significant testimony of the soundness of the raw material. The Yolkshire quotations for 64’s tops were generally about 23jd to 24d at that time, as compared with 31 Ad to 32J today; thus showing an advance during the past ID months of 33 per cent. It has to be admitted that the urgent need for prompt deliveries has established come premium on spot arrivals of the new season ’s wool, it is certain, however, that the quantities available at the current auctions will be readily absorbed at this higher level. In Yorkshire, the position at the combing mills is almost actounding; while there is also considerable overtime and night work in the woollen trade section. Employment is better than for several years past. Stocks have been reduced to a low level, and both consumers and dealerts are anxious to replenish. Despite this, however, there is considerable nervousness due to the experiences of 1933-34, and the substantial advance already established gives ground for some caution. Present Bevel Justified. There are, nevertheless, some outstanding facts that justify the present level. The supplies from Australia are likely to be about 150,000 bales less than last year. Moreover, the season’s offerings are being rapidly disposed of; nearly a quarter of a million bales have been sold in excess of the quantities of the previous season, and consequently, it is quite probable that the Australian auctions may finish this year about Eastertide. The serious lose. of sheep by the drought in Queensland, is a fact that cannot be lost of, seeing that in some districts stationshave been almost decimated. There will, of course, be some dead wool coming forward, but the real loss will be felt in the lambing, and the resultant Joss of sheep during the next twu yearn. As regards demand, Japanese buyers in Australia are unusually active, and some of the more optimistic reports have estimated their requirements for the coming season to be largely in excea.* oi previous years, and believed by many experts tu be in the region of 8,900,009 bales, although this figure may be a little exaggerated. Nevertheless, their purchases already arc well ahead of last year. It is satisfactory to know that the South African clip is nut only more roburt, but likely to provide au increase of 71,000,000 bales. Two-thirds of the clip has yet lu be marketed. Some German buying has already taken place in South Africa, but not to the same extent as last season. Germany has also been able to obtain a purlion of her supplies from Australia. Another satisfactory feature of the world’s position is the genuine improvement in the textile trade of the United States of America. The consumption has increased enormously, and the domestic clip is fully ear-marked. They are already buying freely in Montevideo and Buenur Aires, although they arc not yet able to- import to advantage from Australia or this country. It is fully expected, however, that they will be forced to come, very shortly, into our markets, for Australasian sorts. In crossbreds there is a decided improved position, although there in still some disparity between the values of crossbred tops in Bradford and the price of raw wool, especially in medium grades. Crossbred tops appear to show about 15 per cent, advance as compared with the end of la«*t January; but row wool, especially New Zealands, show 20 to 25 per cent, advance, owing to the strong demand for these cheaper grades from some of the poorer European countries, who cannot afford to pay the price for line merinos. To sum up briefly, stocks of wool in most consuming centres have been allowed to fall to an unusually low level. Consumption continues apace, both in the worsted and the woollen sections, and has quite overtaken supplies. The ladies’ dress goods demand is keeping many of our largest mills fully employed, in. both sections. Meanwhile, sentiment is generally cautious, and textile traders, remembering the experience of two year ago, are pursuing a careful and sound policy.