The Australian government has approved tough new measures aimed at forcing farmers to trim the country's sheep population of 180 million. Australia, which produces 90 percent of the world's wool for apparel, has stockpiled 3.7 million bales due to falling sales to China, the Soviet Union and Eastern Europe. To keep wool off the market, sales at weekly auctions around Australia will be limited to 140,000 bales instead of the current level of 170,000, said John Kerin, Primary Industries and Energy Minister. This will in effect reduce the state subsidy, since the government purchases wool not sold to private buyers at these auctions.

The government also will raise its levy on revenue from the sale of wool to a maximum 30 percent in fiscal 1992 from 25 percent currently.

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