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UNITED STATES DEPARTMENT OF AGRICULTURE
Bureau of Agricultural Economics
WOOL-32 august 99 1939
I NIV OF FL Lie
DOC UM ENTS DEPT .- ..,... .,-....r.., ._-..... .--- .- -- --
S.. THE WO OL SI TUAT ION
S, ..* *U ...'. .-. .
UJ -. DEPOSITORY m
Sales of w6ol in th3 ~ *L.mst-o market mere relatively large in July
and prices of many gradS of wool advanced to the highest level for the
current season, according to the Bureau of Agricultural Economics. The
increase in sales in July followed a decline in prices in the second half
of June, Prices of most gra.d.s of wool at the London wool sales in July
were higher than at the close of the yay series. The advance was greatest
on crossbred wools.
The quintity of wool shorn or to be shorn in the United States in
1939 is estimated at 376 million pounds. This preliminary estimate is 4
million pounds or 1 percent larger than the quantity shorn in 1938 and is
the second largest on record. This estimate does not include wool pulled
from slaughtered sheep and lambs which averaged 65 million pounds annually
in the 5 years 19S4-38,
Stocks of apparel wool held.by United States dealers and manufac-
turers on July 1 tot-.led 255 million pounds, grease basis. Such stocks
were about 42 million pounds smaller than a year earlier and were smaller
than'July 1 stocks in any of the 5 years 1933-37. These figures do not
include wool held on farms and ranches in the producing States, which are
fairly large at this time of year,. But total stocks in the United States
WOOL-32 2 -
on July 1 probably were below the 5-year average.
The weekly rate of mill consumption of apparel wool in the United
States in June was 17 percent higher than in May and was the highest rate
reported since the first quarter of 1937. Consumption, on a grease basis,
in the first half of the year was 70 percent larger than in the same
months last year and almost 20 percent larger than the 6-months average
for the 10 years 1928-37.
Prospects are for a fairly high level of mill consumption in the
next few months. If consumption in the last half of the year should equal
that of 1938 (July-December), the consumption for the first 9 months
(April-December) of the current season would be about equal.to the esti-
mated production of shorn and pulled wool for 1939. Consequently, fairly
large imports may be necessary before the 1940 domestic clip is available.
An estimated increase of about 3 percent in Australian wool pro-
duction for 1939-40 is offset by the smaller carry-over at selling centers,
and total supplies for the new season are estimated to be about equal to
the 5-year (1933-37) average. The carry-over of wool into the 1939-40
season in South America and New Zealand is expected to be much smaller than
in 1938 and also smaller than the 5-year average.
Wool exports from the five Southern Hemisphere countries to June 30
of the 1938-39 season totaled 1,831 million pounds. This was 17 percent
larger than in the 1937-38 season and 6 percent larger.than the average
exports to June 30 in the 5 seasons 1932-33 to 1936-37. Stocks of wool
are fairly large in importing countries but mill activity is now at a
relatively high level in most countries.
RECENT DEVELOPMENTS IN DOMESTIC SITUATION.
Domestic wool prices advance in July
Sales of wool in the domestic market were relatively large in July
and prices advanced. At the end of the month, Boston quotations for most
grades of wool were at the highest point for the current season. Mixed
lots of country packed 3/8 and 2/4 blood bright fleece wools sold at
31-32.5 cents a pound, grease basis, delivered to Eastern markets, in the
last week of July, compared with 30 cents a pound a month earlier. In the
week ended July 30, 1938 such wool of the 1938 clip, sold at 31-32 cents a
pound. Good French combing length fine territory wools in original bags
sold at 67-68 cents a pound, scoured basis, the end of July compared with
64-66 cents a month earlier and 65-68 cents a year earlier.
The United States average price of wool received by farmers on
July 15 was 21.8 cents a pound compared with 21.9 cents on June 15 and
19 cents on July 15, 1938.
Dealers' and manufacturers' stocks smaller than a year ago
Stocks of apparel wool held by United States dealers and manufac-
turers, including wool afloat, totaled 255 million pounds, grease basis,
on July 1, 1939 according to reports to the Bureau of the Cunsus. Such
stocks were about 42 million pounds smaller than a year earlier and were
smaller than July 1 stocks in any of the last 5 years of record. These
figures do not include wool held on farms and ranches and in local ware-
houses in producing States. Because most of the new clip had been shorn
by the first of July and a considerable quantity of the clip is still in
the hands of producers, stocks held by dealers and manufacturers do not
include nearly all of the total supply of wool in the country at the be-
ginning of July. The stocks reported by dealers and manufacturers on
July 1 this year, with comparisons, are shown on a scoured equivalent basis
in the accompanying table.
Wool imports below 5-year average
United States imports of apparel wool for consumption 1/ totaled
3-9 million pounds in the first 6 months of this year compared with only
9 million pounds. imported in the same months last year and an average of
about 45 pounds for the 5 years 1933-37, The increase in imports this
year compared with last reflects the wider spread between domestic and
foreign wool prices thus far in 1939. Imports of apparel wool in June
totaled 5.3 million pounds compared with 6.5 million pounds in May and 2
million pounds in June last year.
About 2 million pounds of apparel wool imported from January to June
of this year were "non-competitive" wools, imported free under bond for the
manufacture of carpets, press cloths, etc., and graded not finer than 40.
Y Wool entered for immediate consumption plus wool withdrawn from bonded
warehouses for consumption.
- 3 -
Stocks of raw wool, top and noil held by dealers,
and manufacturers in the United States, scoured
July 1, 1939 with comparisons
Item 1938 1939
June 25 1/ a April 1 1/ i July 1
a 1,000 1,000 1,000
pounds pounds pounds
Apparel wool, total I 139.260 94,506 122.915
Dealers a 81,239 46,o61 56,971
Domestic a 73,455 32,487 46,869
Foreign on hand a 7,631 12,604 8,763
Foreign afloat 153 970 1,339
Manufacturers and topmakers a 58,021 48,445 65,94
Domestic a 43,895 30,423 47,450
Foreign on hand a 13,445 13,885 16,375
Foreign afloat 681 4,137 2,119
Carpet wool, total 32.025 33.0955 31.828
Dealers 4,064 3,461 3,206
Manufacturers : 27,961 29,634 28,622
Tops a 23,462 23,953 17,510
Noils 7,862 10,061 9,398
Compiled from Bureau of the Census Quarterly
Wool Stock Report, July 1,
Mill consumption larger in June
The weekly rate of mill consumption of apparel wool increased
to 5,943,000 pounds, scoured basis, in June. This was 17 percent high-
er than the May rate of consumption and was the highest .eekly average
reported since the first quarter of 1937. The June consumption was 50
percent larger than in June 1938.
Consumption of apparel wool on a grease basis in the first 6
months of this year was equivalent to 243 million pounds of shorn wool
and 39 million pounds of pulled wool. In the same months last year mill
consumption was equivalent to 131 million pounds of shorn wool and 28
million pounds of pulled wool. Consumption on a grease basis in the
first half of this year was almost 20 percent larger than the 6-month
average for the 10 years 1928-37.
ogtic, o4 l roduc ? lge in L
The quantity of wool shorn or to be shorn in the United States in
1939 is estimated by the Agricultural Marketing Service at 375,699,000
pounds. This preliminary estimate is about 3,700,000 pounds, or 1 per-
cent more than the qu.ntity shorn in 1938, about 6 percent above the
10-yeor (192&-37) averfre, and the second largest on record.
The estimated number of heap shorn or to be shorn this year is
47,455,000 head or about 2 percent larger than in 1938. The average
weight per fleece was 7.92 pouUids this year compared with 7.98 pounds
Production, imports arnd mill consumption of apparel wool, grease
basis, in the United Staetes specified periods, 1935-39
Year begin- Prodcion : General I Mill
ning April 1 ; t miorta l/ : consumption
: Mliu. million M.llion
( r-J11J pounds pounds
1935-36 : 431 83 2/ 673
1936-37 47 164 582
1937-38 4 433 6o0 40
193S-39 36 49 3/ 544
Apr.-.une 1938 : / 436 4 87
Apr.-June 1939 I / 440 19 133
Imports from the Bureau of Foreig and Domestic Oommerce. Consumption
from the Bureau of the Census.
i/ Weight as reported, greasy, scoured and skin wool added together,
General imports include wool entered for iLmediate consumption and
entries into bonded warehouses.
2/ Stocks were large at the beginning of 1935.
_/ Bureau of the Census figure adjusted to 52-week basis.
Production for entire year. Figure for 1939 includes pulled wool
estimate equal to production in 1938.
Demand and'supply factors in thb'wool situation have not changed
materially since the July Wool Situation was issued. In view of prospects
for relatively stable domestic demand conditions during 1939 mill con-
sumption of wool in the United States is likely to continue at a fairly
high level through 1939. But consumption for the last 6 months of the year
may be no larger than in the last half of 1938. In "the first half of this
year mill consumption was 70 percent larger than in the snme months last
year when consumption was relatively small. Consumption in the last half
of 193S was somewhat above the 5-year (1933-37) average.
Domestic supply conditions continue nuch more favorable than a
year earlier. In the first half of 1938 mill consumption was at a very
low level and stocks or wool in thc United States were relatively large.
Mill consumption -icre. .uod rapidly in the last half of 1938 and v/as at a
fairly high-level in the early months of 1939. Mill consumtion for the
12 months ended March 31, 19'3 exceeded estimated production plus imports
by more than 50 million pounds. Hence stocks of wool in this country at
the beginning of the 1939 season on April 1 were uuch smaller than a year
earlier and probably were below the 5-year (1933-37) average. Imports of
wool thus far in 1939 have been larger than in 1938 but larger mill con-
sumption has more than offset the-increase in imports.
If mill consumption in the last half of the year should equal that
of 193g the consumption for the first 9-months (April-December) of the
current season would be about equal to the estimated production of shorn
and pulled wool for 1939. Consequently fairly largo imports may be ne-
c.essary before the 1940 clip is available.
Developments in the foreign market after the opening of the 1939-40
season in September will be an important factor in the domestic market.
An estimated increase of about 3 percent in Australian production for
1939-40 is offsett by the smaller carryover at selling centers and supplies
for tho new season are estimated to be about equal to the 5-year (1933-37)
avers.r:u. In view of the present strong donand for crossbred wools the
carry:-vr of wool into the 1939-40 season in South America and New Zealand
is expected to be much smaller than in 1938 and also smaller than the 5-
On the other hand, stocks in European importing countries and the
United Kingdom are fairly large. But nill activity is relatively high
in these countries and the present political tension in Europe favors
the building up of raw wool supplies in manufacturing centers.
Wool prices advance at July London sales
The fourth series of London wool sales opened July 11. Prices of
practically all wools were higher than at the close of the May sales.
The advance was greatest on :ediun and low greasy crossbred wools but
the opening advance of 15 to 20 percent on such wools was not fully
maintained. At the close of the series on July 26 prices of greasy
merino wools were 5 to 71 percent higher than at the close of the previ-
ous series on May 11, fine greasy crossbreds 5 percent, and medium and
low greasy crossbreds 10 to 15 percent higher than in UMay. Prices of
scoured crossbred wools were 5 percent above May quotations but scoured
merino wools showed little change in price.
- 7 -
The sharp rise in prj cs of ro'.iu nnJ low crossbred wools is due
chiefly to the demand for tk ese qualities for use in uif6or cloths. Stocks
of these grades have been ra idly depleted at London, englishh buyers took
59,000 bales of wool at the F"u.ly series and gca.tiner.bal buyers 24,000 bales,
a total of 83,000 bales. About 68,000 bales wye sold at the -Tu-1y series
last year. The ne. .~ snris ct TLondcn will orp Septenbe -19,.
Southern Hemisphere sa:e s
Sales of crossbred wool s in the South American market xwere relative-
ly large in June and prices ad rc-r.d, Deronnd was greatest for coarse cross-
bred wools which were purchaseat by the United S-atcs and the United King-
dom. The 1938-39 selling seasrn w.:.ll continue through peptembor in Uruguay
The 1935-39 selling season enc ed Tune 30 in Australia, the Union
of South Africa and N .Zealand ResIlar sales of the new season will
open in Australia .and the Uniao of 6So th Africa in September and in New
Zealand in November.
Smaller cPrruyover in Soutiior fciarh fre
The carryover of wool : t sell .g contors in Australia and the Union
of South Africa, the two pri:- Apal file wool-producing countries of the
Southern Honisphere, totaled 53 millida pounds at the close of the 193S-
39 season on June 30. Such r.tocks wer only half as l.rge as a year
earlier but were about equal to the ava rage June 30 stocks of the 5 years
Complete statistics are not yet available for the 193S-39 season in
South America and New Zeoa and, the chief sources of crossbred wool. But it
seems likely that the car:.yover in these counties also will be much small-
er than in 1938. Stocks of greasy wool held by brokers and growers in New
Zealand at the end of the 193g-39 season on June 30 were about 35 percent
smaller than a year ear'-ier and only one-third as large as average June 30
stocks in the 5 yoars 7.933-37, according to estimates of Dalgety and Co.,
wool brokers. Apparer.t supplies l/ of wool in Argentina and Uruguay on
July 1 were about half as large as a year earlier and were 18 percent small-
er than average July 1 supplies of the 5 preceding years. The marked re-
duction in South American supplies compared with earlier years, is largely
in Argentina. Apparent supplies in Uruguay on July 1 were only slightly
smaller than in 193,8 when supplies were relatively largo. But a consider-
able quantity of wool, already sold, 'was awaiting shipment from Montevidep
at the end of Juna according to a report front Vice Consul Adams. In view
of the current strong demand and higher prices for crossbred wool it seems
likely that stocks in Uruguay will be greatly reduced before the close-
of the current 'Jouth American marketing season on September 30.
1/ Carryover f:.omr preceding season plus estimated production minus exports
and estimated domestic consumption.
WOOL-32 -8 -
Exports large in 193-39
Exports from the five Southern Hemisphere countries for the 1938-39
season up to June 30 1/ totaled 1,831 million pounds. This was 17 percent
larger than the exports for the same period last season and 6 percent greater
than the average for the period in the five seasons 1932-33 to 1936-37. The
strong demand for crossb.ied wools in the 1938-39 season is reflected in ex-
port statistics for New .. land, Argentina and Uruguay. Exports from these
countries to June 30 were about 16 percent above the 5-year average.
Wool exports from five Southern Hemisphere countries to
June 30 of the 1938-39 season, with comparisons
: 1936-37: 1937-38:
: : :
: : _36-37 : ___
: : Mil.lb. Mil.lb. Mil.lb. Mil.lb.
Australia 2g ........... July-June 3I: 854.8 827.0 788.4 869.0
Union of South Africa 4: : 251.1 255.2 218.4 241.0
Total 2 countries,5/..: 1,05.9 1,082.2 1,006.8 1,110.0
New Zealand 2/ .........: Jly-June 3/: 252.5 277.2 262.8 310.2
Argentina _/ ........... Oct.-June : 265.1 260.9 225.9 312.7
Uruguay 6/ ............. 102.9 113.7 70.8 97.7
Total 3 countries 7/ .: 0.5 651.8 559.5 720.6
1 Preliminary. g/ Estimates of Dalgety & Co. J/ Entire season.
Official statistics. 5/ Australia and the Union of South Africa are
the principal fine wool producing countries of the Southern Hemisphere.
6 Commercial estimates supplied by the Buenos Aires office of the Bureau.
2/ Th-Zs countries produce chiefly crossbred wool.
Improvcront in mr.nufacturir. activity maintainc4l
The indcx of wool top production in the ULited Kingdom, France, Belgium,
Poland and.. .: gary advanced to 106.6 in May compared, with 89.4 a year earlier
and an vr.'r.e of 96.5 for May in the years 1935-37 (1935 = 100) according to
statistics published in Wool Intelligence Notes. A considerable part of the
recent improvement in activity is due to Governmen'. orders for military needs
but there has been some increase in civilian orders in the last few months.
I/ Season ends June 30 in Australia, Union of South Africa and New Zealand,
September 30 in Argentina and Uruguay.
- 9 -
Employment in the wool manufacturing industry of the United Kingdom
showed further improvement in June. Only 9.1 percent of insured workers
were registered as unemployed on June 12 compared with 12.3 in May and 22.9
percent in June 1935. Exports of wool tops, yarns and piece goods from the
United Kingdom in the first half of 1939 were larger than in those months
in 193S. But exports continue smaller than the average of the 5 preceding
Wool imports large in most countries
The imrri-rr o.jt in wool manufacturing activity in foreign countries
has. been acco-panied by a marked increase in imports of raw wool into
practical] all couutris es~opt Italy. Imports retained in the United
King3J.. in the first 6 months of this year were 30 percent larger than in
those n.cn.thel last year and were larger than in the same months of any of the
5 prec--''... years. Imports into France also exceeded those of last year by
30 percent but were about the same as average January-June imports in the 5
Stocks of raw wool in railway and canal depots in Yorkshire, England
on June 1 were twice as large as the stocks a year earlier and were larger
than at any tine since 1934 according to. statistics published in the Wool
Intelligence Notes. While these figures on stocks are not complete they
are believed to indicate the trend of stocks in the hands of English manu-
Prices of wool per pound in specified markets and prices of textile raw materials
in the United States, selected periods, 1937-39
: Average : 1938 : 1939
aret an description 197 193 : July I : Iay June : July
Boston: : Cents cents C Cent Centsent nts Cents
Territory combing, scoured basis
64s, 70s, 80s, (fine) ............:101.9 70.4 68.6 69.8 70.8 71.9
56s (3/8 blood) .................: 87.1 58.9 58.2 58.5 59.8 60.4
46s (low 1/4 blood) .............: 72.1 52.4 51.8 52.0 53.9 54.5
Farm price, 15th of month grease
basis ............................. 32.0 19.1 19.0 21.0 21.9 21.8
London: New series/ :
Fleece wools, clean basis 2/ :
64s, 70s medium ..................: 73.0 51.9 51.3 45.6 46.1 46.8
56s fine crossbred ...............: 52.4 36.9 35.4 34.1 34.6 35.1
46s crossbred ..................: 42.9 28.6 27.7 26.8 29.3 31.2
Scoured basis 3/
64s warp .................... ...: 64.7 44.2 45.1 *39.0 40.0
50S ............................ : 4 .2 28.2 27.7" 28.3 29.2
Southern Hemisphere : Between seasons Prices not representative
United States: Textile fibers
Wool, territory fine staple 4/ .....:101.9 70.4 68.6 69.8 70.8 71.9
Cotton, 7/8 Middling 5/ ............: 11.22 8.58 8.83 9.16 9.50 9.37
Silk, Japanese 13-15 6/ ............:186.0 170.6 181.1 268.9 253.4 264.8
Rayon yarn, 150 denier / ..........: 62.2 52.2 49.0 51.0 51.0 51.0
Foreign prices have been converted at prevailing rates of exchange. Yearly averages
are averages of monthly prices except United States farm price which is a weighted
1/ The price series formerly compiled by the London office of the Bureau of Agri-
cultural Economics has been discontinued.
2/ Prices based on opening and closing quotations for each series of London sales
reported in Kreglinger and Fernau London Sales Reports. For months when no
sales were held, prices are simple averages of closing quotation in preceding
month and opening quotation in following month. Prices are first cost, London,
clean without oil. Statistics by months 1928-37, grates 64-70s and 56s, pub-
lished in Agricultural Statistics 1938, p. 326.
3/ Quotations reported about the 25th of the month by the London office of the
4/ Scoured basis, at Boston.
SAverage at 10 markets.
S78 percent white, at New York, Bureau of Labor Statistics.
SBureau of Labor Statistics.
- 10 -
United States: Wool imports, consumption and machinery activity,
specified periods, 1937-39
Imports for consumption: pounds
actual weight: :/
Finer than 0os ......:126,601
Not finer than 40s .. 23,5~9
camels hair .........:172,091
Apparel ............. 4,772
Carpet ..............: 2,023
Apparel .............: 248,121
Carpet .......... :105,197
: 193g : Jan.-June :
: 1938 :1939
1,000 1,000 1,000
pounds pounds pounds
71,908 16,256 76,738 3,609 13,797
2,932 5,119 3,867 5,o61
833 1,874 828 1,463
76,245 133,0o3 15,467 20,244
21,660 48,719 3,036 5,852
Machinery activity 2/
Hours operated per :
machine in place :
Worsted combs ......:
Worsted spindles ...
Woolen spindles ....:
Woolen and worsted
Broad ........ :
Carpet & rug looms- :
Broad ....... ....
22.7 39.0 25.0 36.5 41.8
9.5 11.0 7.5 10.5 11.2
Import figures from the Bureau of Foreign and Domestic Commerce.
machinery activity from the Bureau of the Census.
I/ Weight of greasy, scoured and skin wool added together.
g/ Figures for May end June based on 4 weeks, January to June 26 weeks: 1938
totals based on 53 weeks. No adjustment made for holidays.
3/ "Weekly average hours operated per machine or spindle in place" will take the
place of "percentage of maximum single shift capacity" previously reported. The
percentage of single shift capacity (40 hours) may be obtained by dividing the
above figures by 40.
4/ Revised figures.
- 11 -
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