§ Mr. McLoughlinTo ask the Minister of Agriculture, Fisheries and Food if he is able to announce the guaranteed price for wool for the 1989 clip; and if he will make a statement.
§ Mr. MacGregorTogether with the Secretaries of State for Scotland, Wales and Northern Ireland, I have reviewed the state of the wool market and prospects for the 1989 clip.
The British Wool Marketing board has achieved good prices for United Kingdom wool in 1988. Average market prices for the 1988 clip rose above the prevailing guarantee, enabling the board to make further repayments to the stabilisation fund. Stocks are low and demand continues to be good; the wool board is confident of market prospects for 1989.
We have given careful consideration to an appropriate guarantee level for 1989 in the light of these market circumstances. We have also noted the deficit on the stabilisation fund, currently around £14.5 million and my announcement in October last year of our plans to abolish the wool guarantee. We have decided in the light of these considerations to set the price guarantee for the 1989 clip at an unchanged level, 129p/kg.
Following the sale of the 1989 clip any remaining deficit falls to be written off under the terms of the financial agreement with the board, During the following period leading up to the termination of the guarantees for wool we would not expect to raise the price guarantee above its present level.