GROWERS' PLIGHT

Evening Post, Volume CXXVIII, Issue 109, 4 November 1939, Page 8

GROWERS' PLIGHT

PREDICAMENT OF INDUSTRY

DEADLOCK REACHED

Members of the New Zealand-' Fruit-export Control Board have been in conference for the past three days with the directors of the New Zealand Fruitgrowers' Federation, and have had frequent . contact with the Hon. Mr. Nash, but Minister and conference have' failed to reach agreement on. : the' question of Government assistance to the industry. The fruitgrowers in a prepared pub- '" lie statement (which for reasons of ' space cannot be published at length) show that the war has" completely upset the economics of the Dominion's ; primary industries, but the prejudicial > effect, especially in regard to meat and " , wool, is infinitesimal as compared with that facing the fruit industry. In the year's freight plans for' New Zealand produce in normal times the shipping •,lines have reserved refrigerated space "for fruit for approximately 1,300,000 ■ cases of apples and pears, this total, ac- ) cording to seasonal condition, being * varied above or below that figure. Under war conditions, the Imperial Government is commandeering all meat and dairy produce at stated prices, but has declined to purchase fresh fruit or give any promise that space will be . made available. In effect, preference 1 must be given to meat and dairy pro-, duce as being more essential under wartime conditions. NO EMBARGO ON FRUIT. That the Imperial Government has ; so far been unable to make any commitments in regard to the purchase of ' fresh fruit is not due to lack of effort ; on the part of the New Zealand Gov- !' eminent. On the contrary, the Mm'- ' ister of Marketing has used every ' endeavour to induce the Imperial Government to either purchase' a reasonable quantity of fruit or make some ■provision for shipping space. While ; likelihood of purchase is still remote, * the Imperial Government makes it ■* clear that there is no intention of placing any embargo on imports of fresh fruit from Dominions, tid the ." fruit interests will be free to utilise * any suitable refrigerated tonnage avail- " able on overseas ships. But there is » nothing to justify an assurance that " such tonnage will be available. Still, ;it is not suggested that a completely ~ pessimistic view should be taken of- ', the position. ■'■ The fruit grower must visualise giy- .*- ing up his valuable market overseas in ;• favour of other sections of the primary '' industries, necessitating the marketing within New Zealand of double the •• normal capacity of the markets or the '•.- elimination of sufficient of the crop to •, bring supplies within reasonable range ','J of demand, even after the utilisation of ; the maximum quantity through by-pro- \ duct channels. .-.'...... Whichever course it may be found ■ ultimately necessary to follow, the re- - suit from a financial point of view *; must obviously be • disastrous to the * fruit grower, and, according to the degree of final; sacrifice which he may :, be called upon to make, spells ruina*i tion for numbers of what is con-: 21 ceded as being one of the hardest-work- ' ing sections of the farming industry. i 1 Excepting tobacco and market gar- ?, dening, there is probably no primary * industry which produces as much in *. value per acre as fruit growing. j?1 A NATIONAL PROBLEM. From whatever angle the position is .» viewed, the fruit grower is emphatic £ that the problem is a national one, and 5 that the full burden of these emer- ;; gency conditions should not fall upon j, the shoulders of the fruit grower. He, *'■ on his part, faces up to the position f and frankly recognises that any quesv, tion of profits must be placed in the *l background, but on the other hand, he t, does claim equal rights with his em- ; ployee to an equal standard of livJ ing after honourably meeting his pro- » duction debts. \ Present difficulties have been general and cumulative over a period of years. Because of the present emergency conditions, due to war, the growers' difficulties have been accentuated and are now at the stage of becoming tragic unless decisive action on a jiatiorial ". scale is taken promptly. * 'Reference is made to the stimulation i" of plantings of orchards in 1909 by "r Government guarantee to the grower ; of Id a pound net to cover production \ costs 6f all apples'and pears exported ! from New. Zealand. This resulted in the establishment of orchards greatly - in excess of the requirements of the New Zealand market. ..., .' Export became essential for the sue- . cess of the industry. In 1926 the New , Zealand Fruit ■ Export Control Board "' was established with statutory powers. It cautiously developed a market system for export of fruit, but five years elapsed before full and complete control was exercised. Growers as a "body are justly proud of their organisation, and strongly desire that it be allowed to continue. ...The board has at all iinpes worked in close association with' the Government of the day. It is the firm conviction of the industry that it is a continuation of! this position which will give most content within the industry. If Government control is exercised the industry will lose its board, and there is no evidence that market returns will be increased, growers' costs reduced, or: any important advantage will accrue to the Government. RISING COSTS. The present export organisation claims to give to growers a feeling of 1 freedom on a democratic basis which cannot otherwise be obtained. But why did the two organisations of the industry request the Government to take complete control and give to the industry its cost of production plus a standard of living in keeping with the fruit growers' services to the community? Because the general rise in costs did not give to the growers an increased return whereby those costs could be met. Government control was the only basis upon which. Mr. Nash would agree to give further assistance to the industry. In 1937, the local-market position in face of rising costs became so acute that the Government undertook that if the general price of apples within New Zealand during 1938, fell below 5s 2d. return to the grower at local dispatch point the Government would subsidise the general average up to 5s 2d level and pay this to all growers. But the industry did not and does not agree that 5s 2d represented full compensation to the grower but it accepted this offer as it assisted to reduce losses. Growers' production costs under equally, efficient manage<ment vary according to class of soil, and variety of apple from 3s to 4s per bushel and 3s 4d per bushel is accepted as a general average on a 300 bushels per acre crop. This is an average production per acre which cannot be maintained, not even in the rich lands of Hawke's Bay. But even in this high assessment of production the most that a grower would obtain for his own labour is £210 and it can

hardly be contended that this is above his present day requirements. Any reduction in net return of 3s 4d means a reduction on the grower's living expenses as prices for all other labours and all materials are outside of the grower's power to control. A summary of the grower's costs on a 10-acre orchard are:—Production: Interest and depreciation, £93; materials and repairs, £110; owner's labour, £210; casual labour, £87; total, £500, equal t- 3s 4d per case. Packing and -cartage for export cost 2s 8d additional, or for local market 2s 4d. QUESTION OF CONTROL. Marketing for the 1937-38 crop, under the 5s 2d guarantee, resulted in a substantial pay-out by the Government, and Mr. Nash stated that he would not consider continuation of this arrangement and ..would give the industry no further assistance on the local market unless the industry requested Government control. It had been pointed out to him that it would be difficult to get 100 per cent, of the growers to make a request of this nature, but in the circumstances the Fruitgrowers' Federation and the Fruit Board, on behalf of the industry, requested the Minister to take control and give to the producer his cost of production plus a fair standard of living. A committee investigating ways and means was appointed, but the war intervened. When attention was given to fruit matters it was indicated to the industry that by reason of emergency conditions and loss of shipping space, the position was changed and the Government should review afresh as to what should be done under present conditions. The industry feltt that control on the local market became more than ever essen- ■ tial. It was also suggested that the j Minister fix prices to growers. The | Minister pointed out that all growers j were not unanimous with regard to Government control. This is true. But for extenuating circumstances, few, if any, growers would request Government control, but the industry's organisations are insistent that to avoid a major disaster to growers, with perhaps wholesale bankruptcy, it is imperative that the Government take control or grant statutory powers for producers' organisations, to effect control. The Minister suggested a.producers' organisation to be given statutory powers for sale of fruit on the local market, the Government purchasing approximately one-third of the crop at 6s 9d f.o.b. This offer after being considered by the growers', conference was not accepted, but they suggested an alternative which was unacceptable to the Minister. The growers requested the Government to take over the fruit at the assembly point. But the Minister was not prepared to do this, nor prepared to accede to the request to increase Government purchase to 1,250,000 cases, but he was prepared to increase the f.o.b. price from 6s 9d to 7s. But there was no guarantee to the grower as to what market returns would be for the balance of the crop, approximately 2,000,000 cases, which would have to go on to the local market, the normal consumption of which ranges from 1,250,000 to 1,500,000. The only assistance offered was that finance would be available to the extent of £K)0,000 to enable the board to cool store portion of the crop awaiting sale. The growers could not see an assured return to the grower of any definite value per case. GROWERS' PROPOSAL. Growers' organisations have again requested that the Minister take full marketing control of all the apples 'and pears and guarantee to producers : cost of production^plus a reasonable standard,;of 31iv£ngi or alternatively to grant to ''* a producers' organisation statutory powers necessary for organising the local market, and through this organisation guarantee to growers a minimum return of 5s per .case at assembly point. The cost of fruit packed for export is 3s 4d, plus 2s Bd, making 6s. while fruit in the local pack is 4d per case less. This means that the difference between 5s lOd average for local and export packed and the 5s guarantee requested by the industry, would have to be borne by the grower. GROWERS EMBARRASSED. Growers are faced with grave immediate problems. Through being unable to make satisfactory financial arrange: ments for the coming crop they cannot make commitments for usual supplies. Supplying firms in various parts of the Dominion are even now making inquiries from the federation as to when a return to normal supply of material may be expected.' The federation is ui\able to give a satisfactory answer to this question. Growers are uncertain as to finance facilities, making it difficult for them to get the cash necessary for engagement of labour for operations in the orchard. Unless the necessary labdur for spraying can be engaged, the quality of the coming crop is endangered. The grower himself may tighten his belt while waiting for better times, but all other wages and also materials must be paid for promptly. The New Zealand Workers' Union has notified the industry that the union desires a new agreement. The withdrawal of Government assistance now jeopardises the workers' prospects of the present wages scale being continued.