PRICE OF WHEAT

Ashburton Guardian, Volume 53, Issue 272, 29 August 1933, Page 7

PRICE OF WHEAT

WORLD STABILISATION. WELCOMED BY MR MACH IN. (Special to the “ Guardian.”) CHRISTCHURCH, This Day.

Satisfaction at the cabled announcement that a world wheat agreement had been reached was expressed by Mr William Machin in, an interview last evening. While agreeing that the agreement should result in a more favourable price than that , ruling for the last 12 months, Mr Machin pointed out that New Zealand’s sliding scale formed the fairest plan that could be devised if means could be found .by which the Dominion need not export any wheat. “I am glad to see that the representatives of 29 countries of the world have agreed on a plan for stabilising wheat prices at a reasonable level,” said Mr Machin. “Sixty-three cents gold is not a high level; it compares 'unfavourably witn the dollar wheat of a few years ago, but it is better than the shockingly low prices which have been current, particularly for the last 'l2 months, and generally since the huge surplus of the world’s 1928-29 harvest, following which the world’s carry-over has been in the neighbourhood of 1,000,000,000 bushels in August yearly. “It has been this huge surplus which has* held down the prices far below? the production cost, even in countries where this produetioir cost has been lowest. The corollary of the price agreement is the determination to reduce tire area by 15 per cent, and the exports from each of the large exporting countries. This should force some means of using up the world’s surplus and result in a reasonable price being obtained normally. Of course higher production per acre through exceptionally favourable harvests or by better methods may frustrate even reduced acreages.

“This plan is in line with . the American proposals under President Roosevelt’s scireme, which came into operation last month and by which all millers and others who use wheat for manufacturing purposes will pay a tax of 30 cents per bushel. This was designed to make up the price to the farmer to 88.4 cents per bushel, whicn is calculated to be the average purchasing value of a bushel of wheat iu tne States in terms of cither commodities over the years 1909-14. This really means that America is trying to use a bushel of wheat as an item in a.commodity standard of price and currency values. The experiment will pe watered with considerable interest heeav.se it is linked with a plan for reouemg acreage, as the famipr will receive such a price upon only five-eighths of his average crop for the preceding Hrce years in the meantime, until the aiea under wheat is reduced. “Just a word about New Zealand. All these plans should interest us in New Zealand very much because outsliding scale is the only one which lias stood the test-of doing what was clainir ed for it. Although the wheat grower fcnis year is not getting the benefit which the sliding scale should give him, because he has to finance the loss on a surplus which has been ex port-id, if we can deyise a means by whicn we do not need to export any wheat, thet e is no plan in all the countries el the vvorld which is fairer to uotli grower and bread consumer than our New Zealand plan. “One great benefit of'the world s wheat price plan if it succeeds will be that we shall probably hear no more in New Zealand about the supposed benefits of importing wheat at the ridiculously low prices which the world has seen during the past year. If the world plan is successful it will not be possible to import wheat into- New Zealand at a lower price than about 4s 5d per bushel.”