WELLINGTON COMMENT.

Auckland Star, Volume LV, Issue 116, 17 May 1924, Page 14

WELLINGTON COMMENT.

PROPOSED MEAT MERGER. PRODUCE PRICES MUST FALL. (From Our Special Correspondent) WELUNGTOr May 14. Representatives of the freezing companies are to meet in on Friday May 16, to consider t_» ~.i_stioi] of a meat merger. At tho held hero last month the scheme suggested was that all the meat-freezing companies in tiie Dominion should be amalgamated, and the control pass to the. producers. The scheme in its rough state was submitted to the directors of the proprietary concerns and at the meeting on Friday this matter will be discussed. The whole matter may be said to be nebulous, and the screech of the "Farmers' Weekly" that "information is being deliberately held back." is just so much balderdasli. It may be said with certainty that the scheme suggested has not the slightest hope of beng accepted. It is crude and unworkable, and if the control and management is to pass into the hands of farmers, some people here believe that the industry would soon be extinct. It is to the want of foresight and business ability on the part of the farmers that the industry is to-day in a parlous condition. Works were planted in localities unable to provide adequate stock, or in I localities so remote from port of shipI ment as to make the costs excessive, and there has been the further clement jof inadequate capital. The simple fact ;is that the farmers themselves have ) created an impossible position by strewI ing the North Island with unwanted freezing plants and machinery, and the remedy lies in eliminating the number of workß. Fall in Values Inevitable. The steady fall in the values of beef, mutton and lamb is inevitable. The downward movement began some time ago, and in their endeavours to maintain values, some farmers sought to saddle the monopolists with the crime of exploitation, and the result of their agitation was the Meat Producers' Board. This Board makes a good deal of noise, and is very careful to take the utmost credit for every little thing it does, but it has failed to stem the downward tendency of values, for the simple reason that it has, no power to do so, although it exists by virtue of an Act of the Kew Zealand Parliament. "When we come to consider food products we must realise that there is really only one free and open market for all the world, and that market is Britain." remarked a gentleman closely associated with the export produce business. "Every country with any surplus foodstuffs to export dumps them down in Britain, and Britain is quite willing to be made a dumping ground for food I products, because it is essential to her welfare as an industrial nation that i living should be cheap: Britain simply I cannot go on as at present for other I nations with longer working hours, lower wages and demoralised exchanges can beat her in the world's markets.'' I This authority pointed out that in 1014 I and the years prior to that, prices were ! very low. For instance in the middle lof May. • 1914, Canterbury jputton, I medium weight was quoted at 4Jd, | while the nuntation now is 7jd. North Inland mutton in 1914, was quoted at _Jd. and it is now ruling at' 7d. Light weight Canterbuury lamb was quoted at GJd in 1914. and it is now quoted at 110 7-8 d and North Island lamb, which ! now rules at 10 5-8 d was in 1914 worth only 5 1.1-lGd. j Position Must Be Faced. Taking a lon» view of the situation it seems that it will be equally impossible -to check the downward tendency of values, and this applies equally to butter and cheese and other food products. Temporary expedients may prolong the period of declining prices, hut cannot change the- ultimate Tesult. Foodstuffs are pouring into Britain from every source of supply, and this volume of foodstuffs cannot be absorbed at present prices. Britain will soon be over-stocked with certain classes of food products, and the prices of those products must be greatly reduced to stimulate consumption.- We see this operating now in respect of cheese. East year New Zealand cheese was selling at 140/ and over; to-day it is quoted iat 84/. When cheese was at 95/ some factories declined to sell, others declined ,to sell when it dropped to 90/, but pre- ; sently they will be glad to take what I they can get. In May, 1914. New Zealand cheese was quoted at GO/ and 03/, j and in May, 1912, it ranged from 70/ to 71/. It is now not very much above prewar level. The most eminent economists j have warned us that we have entered upon an era of falling prices, and while jit is quite right from the producers' ' point of view to endeavour to prolong ■ the period of the fall, opportunities should not be neglected for readjusting ; and reducing the costs of reduction. .That would he much more sensible than indulging in silly fulminations against 80-called monopolists. It is Argentine, and not the monopolists, who is cutting into the British meat trade.