WHEAT POOL.

Press, Volume XLIV, Issue 19391, 17 August 1928, Page 12

WHEAT POOL.

AIMS AND OBJECTS. ADDRESS AT HAWARDEN. About 20 ifarmers from Harwarden, Waikari, and surrounding districts gathered in the Hawarden Hall last night to listei. to Mr W. Mulholland's explanation of the proposed wheat pool, to be put into operation in Canterbury. Mr H. H. Holland was voted to the chair. Mr Mulholland said the-movement had arisen from the ranks of the wheat-growers themselves, who realised that some better form of meeting their product was necessary. The canvassers for the scheme were meeting with marked success, and practically every farmer, interviewed was joining

up. "People often say that the pool must injure someone," continued the speaker, "but the only persons whom 1 can see being injured are those who buy wheat for less than it is worth and sell it later at a proht. Mr Stanley Baldwin, addressing farmers in England, prior to his departure for Canada, had said* 'I wonder how many -of you have followed what the farmers of. Canada have done. For years they were monkeyed about by dealers and speculators in wheat but m less than five years the market methods m Western Canada have been revolutionised and depression has given place to optimism. All this has been done by the farmers themselves Confronted by the slump following the post-war boom, they consulted together, and formed a pooiof the great wheat-producing provinces, and this pool was governed by the farmers. They disposed of 212,000i000 bushels of grain grown on 14 million acres of land or 70 per cent, or the total crop of Canada. This effort saved thousands <of Canadian farmers from disaster;' " Mr Mulholland referred to the objection '.-■: that .a scheme, which suited Canada might not suit New Zealand. Conditions in the two countries, he said, were essentially the same. As in Canada so in New Zealand the selling -pressure had been, generally the cause of the slump. Wheat was worth 6s'and it did not brinpr that on the open market Why? Because of. the pressure on growers to sell, sometimes because of financial circumstances, and sometimes because of other reasons. In New Zealand, 6000 to 8000 growers were endeavouring to market their wheat, and 70 per cent, of this was marketed within the first _three months. This.put too'great a strain on, the conditions, and the price went down. Growers on an average sold at 6d a bushel less than it was worth. This in itself would be a very fair profit, and in some cases represented a margin between gain and loss. To eliminate such conditions the committee had thought it wise to decrease the number of sellers from 6000 to one, or as near that as possible. ; '■ ~ The speaker went on to give details of the scheme. He. showed that the company : was a limited.liability: company, with the shares allotted to wheatgrowers only.' These would be divided on an average basis. Of the £1 shares 6s would be called up as an organisation fund. The system for election of directors of the company had been designed to give all wheat-growing districts representation. A committee of ten would !be set up to elect directors, and they would remain in office to attend to/details. The scheme was based on a contract quite voluntary. Growers wero asked to sigh a contract for' five years. All,the wheat would pass into the pool, and los;e its identity under different classifications. If. after twoor three .years,, the pool seemed to bo a failure— : be could not imagine such a thing—the company could be wound up. and all contracts would cease, "Why have a contract at all ?" asked the speaker. This was-necessary so that the marketing should be in the hands of one seller, and no one else would have any say for'the. time being. While the grower lost the right to Bay what should be done with his wheat, .he was also divested, of all responsibility in connexion with it, and did not have, to trouble about the trend.in price. No farmer had the knowledge, or the- time to study the market fully. The pool was going to do this for him through an expest who was going,to be! in; contact ,with the market from hour to hour. '

Dealing with the method of handling, Mr Mulholland explained jthat leading grain merchants would act as brokers. Another great boon was thatthe grain would be- marketed at the right tim£ Loss through the. rejection of grain recently had been' enough to run the poor for any one year, and 90 per cent, of this loss had been incurred thrqugh the .grain being in an immature condition. It was not at all likely that they would have to build stores in main centres, but it might be necessary to do so in> the country because the only two places to store ,wheat economicairy~«were at the point of production or at the of consumption. •'■ Mr Mulholland next .spoke of the details of the proposed reserve fund which; would be an additional source of capital. • After the pool 'had - been; established on? a- sound baisis, at the end of two or three years, would be, divided .among, the shareholders. in the form of preferential shares. "The results our canvassers'are obtaining," he said ""have astonished, me. ' This time the farmers.are going to stick together and maybe, prove a nuisance: to those who have been profiting by their disunity in the past. Unless we can get a growers' organisation to, combat the practice,of millers . buying wheat at 5s 2d and 5s 3d and •Beflihg flour on. the basis, of 6s 2d, the duties on wheat are going and so, is wheat-growing. Can we; with any vim, defend duties which give the millers a profit of > a shilling and . the consumers a negligible advantage?" Mr, Mulholland concluded with an appeal to all'growers to get behind the scheme to' a man and the job would be as good as done. In reply to. a question regarding grading, he said that the pool would nave-its own graders, who would work in conjunction with, perhaps, the millers and Government graders, but the grower would also have a say. There would probably be more grade* than at present.' : Another questioner wanted to know what brokers wei* to get out of, it. Mr Mulholland replied, that this had not been fixed, though 'they had a penny a bushel'in mind. This would be paid by the pool,: not by the grower He would have to do more for his money than at present. So far as the association was concerned it was doubtful if it could perform this Service for a penny as it Was a seasonable occupation demanding specific qualifications on the part of those engaged. The association would handle all wheat except; perhaps, seconds* whether rejected or not. ; ■ Further questions elicited the information that the association had not yet approached the millers, but it was not flxpected there would be any organised opposition. They were not, going to do anything detrimental to the growers in their dealings with . the millers, but they did not wish to.fight them merely for the sake of so doing. He had ' never heard ■ adverse criticism of the* 1 poo] from the millers. One reason for this was that the millers were ho'din<» op to the sliding scale of duties which had benefited them greatly. Regarding, storage, the object of the scheme was to' take delivery' as the grower * desired, but delivery would Tie so ordered that "there would be no glut,, and : the miller would naturally be asked to

pay more for his wheat in September than in March. . One grower asked what the effect or next year*s crop being sold in advance would be. ...•». i. "Admittedly it will make it dofficult for the pool," said Mr Mulholland, "but it will make it still harder for the individual to get rid of his wheat, won't it? Anyway there is nothing like 30 or 40 per cent, of next year's crop sold in advance. My information is that south of the Rakaia no forward sales have been made. In North Canterbury they seemed to have taken whole patches and cleaned them out. In Leeston, foi example, more than t»v per cent, has been sold forward, but I want you to understand that a sale in advance does not, prohibit a grower from signing the contract. We have made provision for that." In regard to details it was the association's policy to respect the wishes of the growers whenever it did not conflict with its policy designed for the common good. The attendance was not considered sufficiently representative to set up a committee, but several of those present volunteered to help the-organiser, Mr C. A. Wornall, to comb the district thoroughly. Mr Mulholland was accorded a vote of thanks.