The Otago Daily Times

Monday, November 23, 1885.

Amidst the prevailing depression there are two or three bright gleams which, if they do not justify sanguine anticipations of an early return of a period of prosperity, at least afford elements of hope for the future. Foremost among these is the partial recovery which has set in at the current series of wool sales in London. An advance of 5 to 10 per cent., if maintained, is in itself of importance, but at this juncture the announcement is of all the greater importance, inasmuch as it indicates that great as has been the increase in production the demand is overtaking it. Though the November sales are generally the best in the year, we could not have expected any improvement if stocks in the hands of manufacturers were heavy. We may infer from the fact that any advance at all has taken place that the previous accumulations have been, or are rapidly being, worked off. We do not see any ground to anticipate a rapid return to high prices, but it is something if the downward course of the market has been arrested. We may at least hope that the bottom has been touched, and that any change will be for the better. Another favourable circumstance is that the last sheep returns show that for the year ending 31st May last there had been an increase in the number of sheep in Otago of about 100,000. This shows that the export of frozen mutton has had the effect of stimulating breeding, and that so far from diminishing our flocks, it is helping to increase them. We suspect the returns from Canterbury and Hawke's Bay will be even more favourable, as there was greater scope for increase in those districts, and the previous year's returns showed a very substantial advance on those of 1883. It is probably not too much to say that in two years the sheep of New Zealand have increased by a million and a-half, besides the million or more of carcasses shipped Home. The recent reduction in freights will in some slight degree compensate for low prices in the London market, and at least has indefinitely postponed the runholders' last resource—boiling down. There are also some signs that the wheat market has reached its lowest. The world's supplies this year are estimated at a far lower figure than for several years past, and the shipments afloat at latest date were not more than a third of the maximum. We fully expect to see a rise of at least 10s a quarter before our next harvest is reaped. There are also, as we recently pointed out, many signs of revival on our gold fields. Some undoubted finds have been made in various parts of Otago and Southland which promise to give profitable employment to a good many men, and these have started others prospecting. It is only a question of time. The gold is there, and sooner or later will be unearthed, and will be a source of wealth to the Colony. The pressure of the lender on the borrower is one of our greatest evils, and must lead to great changes in the ownership of property, but ultimately it must have the effect of bringing down the rate of interest, and then, with prudent management, there will be a margin. We must in this respect get worse before we are better, but a remedial process is already setting in, and it is by no means an unmixed evil that land values have come down. It is well sometimes, while not disguising from ourselves the seriousness of our position, to look at the other side of the picture and estimate our resources fairly. These are undoubtedly very great, though we have discounted them so much by excessive borrowing. We believe it will take two years to pull us round, but a recovery in wool and wheat would do much to hasten the process.