PASTORAL PRODUCE. ;

Waikato Times, Volume 114, Issue 19118, 1 December 1933, Page 7

PASTORAL PRODUCE. ;

WOOL, BUTTER AND WHEAT. AUSTRALIAN AND NEW ZEALAND. POSITION REVIEWED. The rise which has taken place in wool prices since the close of last season’s sales has been of great value to Australia. There are Indications now that the rise, which has been greater in merino wool than in crossbreds, will be sustained. The reasons are to be found in lower world stocks, smaller supply for the current season and in the strong demand. Wool producers are now reaping the benefit of a free market, throughout the depression. There has been no holding back of supplies or other scheme for tho artificial raising of prices during the depression. This absence of restriction lias resulted in stocks being cleared from season to season, so that there has not been the same accumulation of stocks as in' other primary products entering international trade. Smaller Wool Clips. The clip of 1933-34 was estimated at 883.000,000111 early in (lie season—a decline of 145,000.0001 b from the record year of 1932-33; but Jt is now almost 'certain that the total clip will be smaller than was at first uullci-

pated. Nor is Australia the only country producing less wool this season. South Africa and New Zealand also anticipate smaller yields. Yorkshire, France, Germany, Italy and Japan, our best wool customers, are all keen buyers this season. France Is paying very little more in francs for her wool this year than she did last year, owing to the greater disparity between the franc and sterling. Demand is particularly in favour of merino wool. Activity in the woollen industry has improved considerably in all the chief manufacturing countries.

A feature of the wool sales this season lias been the extension of the practice of selling wool at the shed. This is a regrettable practice in a selling system so well organised as tlie Australian. The reason seems to be that growers are in many cases badly in need of ready money, which under the auction sales system they would not obtain for some weeks or months. And, secondly, they want to take advantage of the higher prices, in the fear that they may collapse. The Butter Outlook. Butler exports from Australia will probably not be as heavy as last year, when there was a record shipment of 101,000 tohs, but th eou'.look for the season in New Zealand is distinctly good. From July i to the middle of October the exports from Australia totalled 13,700 ions, as against 21,700 for, the same period last year. This is the result of unfavourable seasonal conditions in tlie principal dairying districts. There is now promise of a splendid spring,, and there has been

some increase In production, but it is not likely that total exports will reach the volume of last year. There has been some improvement in London butter prices, due to hot, dry weather in Europe, causing decreases in domestic production, so that the market open to the exporting countries, particularly Denmark, for sale of their product, has not been confined to London. Wheat Cause for Concern. The present position of the wheat industry must cause some concern to all interested in this important world commodity. The duties imposed on wheat in countries previously importing grain have so stimulated production, which can only bo classed as uneconomic, that some of these countries, as, for instance, France and Germany, are this year expected to have a surplus for export. In spite of this they are not prepared to lower their tariffs until the price lias reached the equivalent of 7s 7Jd per bushel in Australian currency, calculated at the rates of exchange ruling at the time of writing. This will mean a rise of CO per cent, on present prices. The Wheat Agreement was calculated by its sponsors .to bring about a rise in prices, but it lias so far had tho opposite effect. The inherent weakness of the Agreement is that it makes no attempt to limit production, but merely restricts exports. Surpluses will remain in exporting countries and must have their effects on prices. From this it is not to he inferred that restriction of production would have been desirable, least o| all to Australia. .The, fact that it j

was not attempted was merely a confession on the part of its sponsors that the task was impossible. Australia has been allotted an export quota of 105,000,000 bushels for this year. On account of a somewhat less favourable season it Is not expected that she will have as heavy a crop as last year, and estimates now show a probable yield of 150,000,000 bushels. With home requirements at 50,000,000 bushels and exports permitted under the Agreement of 105,000,000 bushels, there should not be a carry-over Into the next wheat year. The chief point about the Agreement, however, is that it solves nothing, since it does not touch the central fact in the wheat situation—namely, the steady growth of uneconomic production in the Old World.