The Oversea Market. 85 



THE OVERSEA MARKET. 



PRESENT POSITION OF WOOL MARKET. 



Writing under date of 4th November, 1920, the Trade Commissioner in- 

 London reports : — 



The wool trade is in a most unsatisfactory state. The Continental demand 

 has fallen off owing to difficulties of exchange. As soon as attempts to buy are 

 made it is found impossible to trade owing to exchange. London wool brokers 

 freely express the opinion that wool must come down in price, even below 

 the cost of production. In South America buyers are already purchasing wool 

 below the cost of production. Germany has been purchasing a few coarse cross- 

 breds, but only at a very low price. Australian sales show that best greasy 

 wools have been selling at lOd. per lb. below the London price, and that the 

 only competition which is being experienced there is between American buyers 

 and the local manufacturers for the best class of wool. Generally speaking, 

 wools other than the best are practically unsaleable here. Proposals are now 

 under consideration, as a measure of philanthropy, for sending to Austria 

 about £800,000 worth of wool which is to be worked up there,' whilst it is 

 further possible that about 100,000 bales of the poorest quality may be sent to 

 Germany. If these transactions turn out satisfactorily, further supplies of the 

 coarse and poor quality may be disposed of. 



As regards the position in Germany, there is at present no scarcity of raw 

 wool in that country. Approximately two-thirds of the looms in the various 

 factories are standing idle, due not so much to the shortage of raw material 

 as to the scarcity of coal, as well as capital, the latter being a very important, 

 factor as can well be imagined, having regard to the fact that the German mark 

 is to-day only one-twelfth of its pre-war value. German manufacturers are 

 getting a fair supply of wool locally, and they have no trouble in getting 

 supplies through Holland. My informant, who has recently visited Germany, 

 tells me that he saw piles and piles of raw wool stacked away. He also states 

 that the value in Germany of South African wool, 12-months' growth, is approxi- 

 mately 16d. to 17d. per lb. for the best qualities delivered on board. South 

 African ports. 



The position of the trade so far as Bradford is concerned is obviously a 

 very difficult one. At the moment the mills are working only twenty-four hours 

 per week instead of the full forty-eight hours, but the hope is expressed in 

 some quarters, now that there is a possibility of the coal strike ending, that 

 the whole position will be reconsidered with a view of placing more machinery 

 into commission. Although topmakers are turning out large quantities of yarns, 

 they cannot get these yarns taken up, and there are enormous stocks on hand. 

 Manufacturers are in a worse plight, and at least 70 per cent, of the cloth they 

 are making must be taken into stock, whilst they have to find the necessary 

 money to finance it. The financial position, however, is considered to be sound, 

 and it is hoped that in the new year the market will improve. I recently took 

 the opportunity of discussing the position with a Bradford topmaker, who 

 pointed out that South African holders are asking about 46d. per lb. clean 

 scoured basis for 12-months' wool delivered London, 42d. for 10-months, and 38d. 

 for 8 to 10 months' wool. They cannot sell at this price, declared my informant, 

 and would probably have to reduce their limits by at least Is. per lb., when 

 there would possibly be more chance of a sale being effected. He further con- 

 tended that the tendency was for prices to go lower in Australia, and that it 

 practically resolved itself into the question as to whether South Africa was 

 going to take the lower price before Australia and to get clear of the accumu- 

 lated stocks of wool. I mention these statements as indicating the views of 

 certain sections of the Bradford wool industry. 



It is freely expressed that the finest wools are still wanted by the Home 

 trade, who will go on to them as soon as conditions improve, but inferior wools 

 and crossbreds will probably have to be sold below cost of production. Excel- 

 lent crossbreds from South America are said to have quite recently been pur- 

 chased at 8id. per lb. in the grease, delivered Liverpool, similar to New 

 Zealand wool which the British Government purchased at 20d. per lb. clean. 



