U:ITIED STATES DEPAPRT;ESITT OF AG.EICULTLW.
Bureau of Agricultural Economics
WOOL-22 October 10,1938
PN F F L . .. .
D MNTS THE WOO L SITUATIOi
The improvement noted in the domestic wool situation since June was
fairly well maintained in Sent;:i ar, reports the Bureau of Agricultural
Economics. Uncertainty in the foreign situation and the flood and hurricane
dazmge in New England, however, were restraining factors in domestic raw wool
The recent advance in domestic prices and the decline in foreign prices
in terms of United States dollars has vaidened the spread between domestic and
foreign prices and the spread is now not much less than the tariff. During
the rcnaindcr of 1938, domestic ;ool prices will be influenced to a greater
extent than in recent months by the movement of foreign prices.
The weekly average rate of nill consumption of ,-p-rel wool in the
United Statec in Augu-t was 27 p'.rc rnt higher than in July, and it was 15 per-
cent higher than in August 1937. The rate of consumption in August v.as the
highest reported since April 1937. Consumption in the first 8 months of 1938,
however, w.as more than 35 percent smaller than a year earlier.
Eccausc of the relatively low stocks of ninua.lctured goods and the
improvLment in the builinss situation generally, the recent improvement in
omncstic mill consumption is expected to be fairly well maintained during the
remainder of this year. With a =.all consumption in the first half of this
year, however, consu:.ption for the entire year 1938 may be somewhat smaller
than in 1937.
WCCL-_' 2 -
l,:ir.. the L.: Ilrning of the nv;ew diLCtic ;ool rarketi:.- season last
April, when stocks .voroe 1. ,- i-.' cIts have e ..n much smciler than a .*-ar
earlier. But the reduction in i.-.::.-t3 has been la:-gly offset ', the decrease
in domestic nill c-::-.z:.;:tion in l ,. front that of 193'7 C.:r._-c.:ntly the total
ru;yly of wool in this country ernly in S(pter.bor continued to be much l.-rgcr
than a year earlier.
Combined .1:- re:t s:!-rlios of wool in Australia, Nrew Zealand and the
Union of South Africa on Scptember 1 arc estimated to be about 2 percent larger
than a ;car earlier but somc'7hat szaler than the Sctcoiber 1 average for the
5 ::c.rs 1 ':- 6. In Argc.~.tiIa and "'r.::-uay the carry-over of wool into the new
season, which opened October 1, apparently was much lir~Lr than in 1937 and
also larger than the 5-year average.
S'.ilies of raw :ool in most foreign inpcrtin. countries, exco-t Japan,
are believed to be seeocwhat larger than a year earlier .whcn r-u l.r.ic in import-
l:i; countries were relatively small.
B..' :11 '-1- ,ill c-n: .-:tion and prices of wcol declined
rapidly in the United States in the second half of 1'-7
and early Lonths of 1938. T.c decline in domestic wool
prices was accompanied by a somewhat smaller drcp in
for;l-.. markets, and the spread between domestic and
foreign prices w.s relatively nclrr=w in the early months
of this ycar. I:. June 1 Z the United States a -:.r:. c
farr price of wool vwas about 45 percent "Llow the 1937
hiT.h and was lower than at any ti:.e since 1935.
Stocks :f raw wrol accur.ulated in the '.'.-.ted
States i.i- :. the icnths of low r.ill activity but stocks
of manufactured w o-1 ..is : "erc greatly reduced in the
first half of i :. An increase in doLestic rill con-
surntion in J11l was acconpani.i a: an increase in
domestic wool prices.
Wool Sales .:-1 Prices
The United States aver. ; fare price of :;ol on S--".-':.r 15 was 15.7
cents a .:..i, c.-.,-r with 19.5 cents on .:. ust 15 :.1 :.8 cents on Sc..-
teaber 15, 1.37. Sales of wool on the Boston 2:arket were relatively snll in
Scpto;:ber, and prices cf graded wools re.aincd practically unchanged i.ri .
the month. 7.-:- uncertainty of the f reign situation and the storm and flood
S..--e in :..-:.: -. probably rver factors which tended to restrict sales.
WOCL-22 3 -
Country p-cked lots of 3/8 and 1/4 blood bright fleece wools were quoted
in Boston at 29 30 cents a pound in the grease at the end of SCpYtc.bcr,
com..are:d -iith 28 29 cents a month earlier. Prices of spot bright fleece
wools of fine combing quality remained unch:an:gi. from August at 29 31 cents
a pound grease basis during September and quotations for similar 3/8 blood wools
remained unchanged at 30 31 cents a pound. Good French combing length fine
territory wools in original bags were available late in September at 62 63
cents a pound scoured basis compared with asking prices of 62 65 cents a month
Governumnt wool loans
According to a recent announcement of the Commodity Credit Corporation,
a total cf 87 million pounds of wool had boon appraised for Government loans
up to September 17, Of this quantity loans had been completed on 51 million
pounds with the remainder in r.-ccz-. The loans have averaged about 17,5 cents
per -rease pound.
Spread between domestic and foreign prices widens
Wool prices in foreign markets have shown little change since i.ay, but
the decline in the exchange value of the British pound in recent months has
tended to lower quotations for foreign wool in terms of United States dollars.
Prices -f domestic wool, on the other hand, have advanced and the spread between
dou-ictic and foreign wool prices has widened.
Sl St ~~cks -.nd IT-crrts
Available supplies of a-. rel class wool in the United States on Sep-
tember 1 were much larger than on that date in 1936 and 1937. Since the be-
ginning of the new marketing season last April imports have been much smaller
than a year earlier, but the reduction in imports has been largely offset by
the decrease in mill consumption as compared with 1937. Consequently the total
supply of wool in this country in early September continues to be larger than a
year earlier. Mill consumption in the remaining r.nnths of 193S, however, is
likely to be somewhat larger than in the sane months of 1937 while imports
probably will remain relatively small. By the end of the year, stocks may be no
larger than a ycar earlier.,
Front January through Aui.uzt, United States imports of apparel wool for
consumption were 15 million pounds cy -:ir. l with 134 million .orunds imported
in those months in 1937 -- when imports were relatively large -- and an average
of about 35 million pounds for the 5 years 1932-36. Imports in August totaled
3.2 million pounds compared with 2.9 million pounds in July and 8 million pounds
in .Lugust 1937, In view of the relatively large supplies of domestic wool,
imports are likely to continue small during the remainder of 1938.
_ill C.: rn u .A.t irn
The weekly rate of mill consumption of apparel wool in the Unidted States
in August was 5,784,000 pounds. This was 27 p roont higher than in July and was
15 percent higher than in Au-u t 1937* rMill consumption in Au,-ust was more than
twice as large as in April, the low month for 1938, and was the highest reported
since April 1937,
Consumption of app-,rel wool in tie first 8 months of 1938, was equiva-
lent to 220 million pounds of shorn wool, grease basis, and 42 million
pounds of pulled wool. In the same months of 1937 consumption was equivalent
te 327 million pounds of shorn wool and 53 million pounds of pulled wool.
In view cf the small stocks of wool go-ds and the prospects for im-
provement in the business situation generally, it is expected that the recent
increase in mill consumption will be fairly well maintain 'd during the *
rmainder of this year. But because of the small consumption in the first
half ?f the year consumption for the entire year may be somewhat smaller
than in 1937.
W:1- Sales and Prices
Lnr.don s: les
When the 5th series of 1938 London wool auctions opened on September
20, prices of greasy merino and fine crossbred wools were about 5 percent
below the closing prices of the previous series on July 22. Prices of
medium and low crossbred wools were about the same as in July. During the
sales, which lasted from Septcembr 20. to September 30, a good demand for spot
wool wTKs accompanied by an advance in prices in the London market. At the
close of the sales, prices for merinos and fine cr-ssbreds in English pence,
were fully equal to the July prices while prices of other crossbreds were 5
to 10 percent L:;igir than at the close of the July series.
When converted to United States dollars the advance in wool prices
at London over July quotations was partly offset by a J-cline of 3 percent
in the exc--.nge value of the English pound between July 22 and Scftemter 30.
At current rates of exchange aver.--e prices of most wools gr ding below
56s were about 2 cents a pound higher nn September 30 than on July 22, but
prices of fine wools were sli.tly lower t-imn in July.
Criers for wool goods placed by the British Government late in
.~-cttember r..d the sharp increase in war risk insurance rates probably were
factors in the advance in prices on the London spot market during the
S--uth=rn Hi.mis rher sales
Prices in the Australian wool -.rk-.t were firm in September. Japyan
and the United States b~ug--.t very little wool hurin- the first month of the
sales but purchases by Er.l-.nd, France and Cvk:rarjy resulted in g cd.- clear-
ances at most'sales. Cancellation of war risk insurance rates caused some
tie-up in wool shi.- r.ts late in S :t---.ber.
The wool market in Argentina was qui:-t in August, and declines were
rep-rted. n rriccs cf second cli; wools which had adv-r.ced in July. Supplies
are still relatively 7-.rg., in the South American maTrkets and there will be a
substantial c"rry-over into the 1938-3 season which b1-ins in October.
Southern Hemisri.-re SW.l Supplies for 1938-39 S':.son
Wool production in the Southern Hemisphere in 1938-39 is expected
to be smaller than a year earlier as a result of a prospective decline of
about 6 percent in the Australian clip. The decline in production, however,
is expected to be more than offset by the increase in carry-over into the
current season. Supplies for the season probably will be slightly larger
than in 1937-38 but about the same as the average for the 5 years 1932-33
Supplies on September 1
Apparent supplies 1J of wool on September 1 in Australia, the Union
of South Africa and New Z23.lnd, whore the new export season opened on
July 1, are estimated at about 1,560,000,000 pounds. This is 2 percent
larger than a year earlier but 4 percent smaller than the September 1
average for the 5 years 1932-36. Supplies on September 1 were smaller than
a year earlier in Australia but were 1 rg:-r in the Union of South Africa
and New Zealand. The increase over a year earlier was entirely due to the
larger carry-over into the 1938-39 season. Combined production for the three
countries is estimated to be 3 prrc .nt smaller than in 1937-38 and exports
for the first 2 months of the-new season were slightly larger than in 1937.
The 1938-39 season opened in Uruguay and Argentina on October 1.
Statistics of carry-over and production for the new season are incomplete,
but the carry-over of wool in those countries apparently was much larger than
a year earlier and was larger than the 5-year average. :Exrcrts from Argentina
and Uruguay in the first 11 months of the 1937-38 season, to September 1,
were only 352 million i ..unlds compared with 415 million pounds exported in the
same months of the previous season.
Wool Surpli s in Importing Countries
Supplies of raw wool in most foreign importing countries, except
Japan, apparently were somewhat Irlrger at the Tl ginning of the 1938-39
Southern Hemisphere marketing season than a year earlier when supplies in
importing countries were relatively small. Inports of raw wool into the
United Kingdom, France and Germany in the first half of 1938 were larger
than in those months of 1937. While there has been some increase in mill
activity in France and Germany, mill consumption in the United Kingdom this
ye:-r has been much smaller than a year ago. Imports into Belgium and Italy,
wr.ere consumption has declined, have been smaller so far in 1938 than a year
Imports and re-xrorts of wool for the principal importing countries
for the years 1934-37 and January-June 1937 and 1938 are shown in table 3.
1/ Carry-over at selling centers at beginning of season, plus estimated
production, minus exports to September 1.
- 5 -
.cle 1.-Prices of wool.- r pound in sr.ci" i.i markets ,:r.d prices of
textile raw materials in the United States, select'i v riods,
Mark t and description
1Trrit:ry e:-.'ir. scoured b'- sis
64s, 70s, -.Is (fine)
"r: (3/8 blo:d)
"1(low 1/4 blood)
Farm price, 15th of month,
Aver-. -. ..'yl: ty, clean cost 2/
r- ford: 3/
: 1936 1937
: '-nts Cents
:s t 1938
1937 July : ug. Sept.
Cents Cents Cents Cents
32.0 30.8 18.7 19.5 18.7
S1 T i -7 ;.I.: .- -
ool, territory fine staple 4/
Cotton, 7/8 3-ilir.- 5/
Silk, J-.r.r.--ze 13-15 /
Rayon yarn, l- C denier I]
re--ign prices have been converted at
z:-. are .-. r ^-s of monthly prices
.;: ted averr e.
97T--. SEASONS 1PRIC- .... ?:T-;S -'.TiVE
101.9 98.5 -.6 71.2
11.2 8.7 8. 8g.4
1? .0 i1'.l i1!.l 1 7 .7
._ '- .C -' 1.C
prev-iilr..- rates of exchange. Yearly aver-
except United States f-rD trice v'r.iic is
/j A-:r'-.e of qaotations for each series rf I -:-.lr. sales reported r. the London
'::ce f the Barea7. :r months when no sales were held :1'.,--res are
/ T. and noil in oil.
1/ ;t-aticns r .-rtcd abo-t the _5th of the conth by the I-.r. 'i- ffi~ of the
r -- "-.,
I-/ "--'red : ..s, Boston arrket.
/ Aver' t 10 markets.
1/ -' percn t white, -t Yow York. --r:-' -f L-:-r Stetistics.
jl -r --; of La'bor Statistics.
Table 2.- United States: Wool imports, consumption and machinery,
activity, specified periods, 1937-38
Total, Jan. Aug. Aug. July : Aug.
1937 1937 1938 1937 : 1938 : 1938
:1,000 lb.1,000 lb.1,000 lb.1,000 lb,1,000 lb.1,000 lb.
Imports for consumption
actual weight: 1/
Apparel : 150,160 134,038 14,685 8,016 2,911 3,202
Finer than 40s : 126,601 113,995 8,740 6,178 1,590 1,382
Not finer than 40s : 23,559 20,043 5,945 1,838 1,321 1,820
camels hair : 172,091 141,524 26,560 12,921 3,997 6,399
Weekly average -
Apparel 4,772 5,537 3,489 5,009 4,549 5,784
Carpet : 2,023 2,498 935 2,167 999 1,506
Apparel : 248,121 193,788 122,127 20,036 22,746 23,136
Carpet : 105,197 87,426 32,724 8,668 4,996 6,025
SPercent Percent Percent Percent Percent Percent
Ma.acrhinery activity: 2/.:
Worsted combs : 115.2 135.2 83.7 110.4 113.8 138.4
Worsted spindles : 82.2 95.5 53.4 72.9 64.2 80.3
Woolen spindles 107.8 124.9 67.3 113.2 78.2 101.5
Looms, broad 97.2 112.9 61.6 93.0 67.2 86.0
Looms, narrow : 51.0 60.9 24.1 42.3 20.5 28.5
Carpet and rug looms: 71.3 82.1 40.1 76.4 37.5 50.7
Impor- 'figures from official records Pf the BurcaLu of Foreigh~ a'd Domest-it
Commerce. Consumption and machinery activity figures from the Bureau of
I/ Weight of greasy, scoured, and skin wool added together.
/ Figures for August based on 4 weeks, July on 5 weeks, January to August
on 35 weeks. No adjustment made for holidays.
- 7 -
UNIVERSITY OF FLORIDA
1 1 l l 1111ll i1111lllIllllll 11111 11111 i
3 1262 08861 5918
'.:cl ir..prts. r-tained by principal importing countries,
annual l 19 4-37, Januar;.' t c Jun-. 1937 and 1938
Country And it.nr.
: 1934 :
1935 : 1936
: Jan. June
:I..illicn "1illin r
U;nit-d 3tt .! -
Apr r:T wrvc
C. r -.t "
"Jnrit.d i. in:d.r r -
'.: x:pcrt s
hR tir..u irrorts
D:u r-c t c F.pcrts
Ir.p rt' sr. rn
cn skirts vccl
.'quiv"- ,..r.t 2/'
F-:x.crts F-r.d cxp :rts
Tr pirti bu ':r.c'
'- r .':n. -
f. ixr',.rt: c.ri ixFp rts
'-.:' r b i' r-.
F -cxyrrt .nrd xY -rt -
crt b .l: ...
i-. -rtc T /
.'... r'r -
!-.rcrt c /
: '?9. 42.0 110.7 150.2 120.6
:79.1 158.5 143.3 172.1 115.C
: 3C.9 35..0 55.4 ,36.6 208. 208.7
: 5.0 6R.2 -. .5 59.3 35.8 32.0
S45. 47.6 64.4 69.2 39.9 21.4
: 350.0 405.6 352.5 :26.9 204.7 219.5
S313.2 272.8 227.7 227.4 134.1 186.6
: .5/ 3/ 3/
: 3u.4 269.5 226.9 227.4 134.1 186.6
: 1.;. 25.n ; F6.C 255.8 178.3 117.5
': 9.6 117.2 106.2 113.0 75.5 35.6
: s5.2 117.8 140.7 142.8 102.7 81.9
147.2 116.0 -2.3 92.C 51.0 40.5
: 191.5 243.- 216.8 255.3 220.2
:- il- 1 fr-r :ffi i-:1 .E-- r--s .r:vr fr'.r "'.7:.1 Irt ]ligenr e !'c.te- published
b:. -.. iL- ri.El Eron-ric Cr.-r-tt.: f th. 'rI;t;d EKir.gdcJ.
I. r-rtr f r .:'r-.tir.. ?: it .. "n-t fj'.-r t.Lrr D3s" is irn-ludcd with
'.-Fg r 1 :1 f'r 11 ;-..rr. I. st-.ti:tlcs Iubtlic .d by the Departr.ent
-f -':.- r., fr.-r 1.30 t. 19'5 this itcr. ':si included with carpet wcols.
', Est- .* t bl is5..A in :1 Int, 11 ig- -n.: I':"t s.
:, Rerx.- :rrs 3 r.. r .. li.il.:.