FINANCE AND COMMERCE.

Press, Volume LXV, Issue 19675, 19 July 1929, Page 12

FINANCE AND COMMERCE.

FROZEN PRODUCE. NEW ZEALAND CHEESE IN BRITAIN. RESEARCH IN MARINE REFRIGERATION. (TOOM OITK SPECIAL COBBESPONMXT.) LONDON, June 4. It was significant of the attitude adapted by certain parties in the dairyproduce trade in London and elsewhere that emphasis was unduly laid upon the principle of cream separation in alluding last month in the public Press to the introduction of New Zealand standardised cheese in the British market. This point, however, seems to have been cleared up now, and it is fully realised that marketing of the new cheese is no endeavour on the part of the New Zealand producers to supply inferior or cheaper cheese, but on the contrary is the natural development of an expanding industry. The new regulations governing the manufacture of standardised cheese gazetted by the New Zealand Government wero obviously essential otherwise a rapid increase in the manufacture of butter and a corresponding decrease in that ot cheese would have teen inevitable. One of the objections eaused by the regulations is that the effect on the London market had not been sufficiently studied. The effect of the new brand of cheese on the British market has vet to be determined, but with the new light which has now been thrown on New Zealand's latest enterprise, it is safe to predict that assuming New Zealand is willing to "tell the story", her product should meet with a ready reception. Ships' Refrigerated Holds. The many activities on the part of Bcientists to elucidate the hydra-headed problems of perishable food carriage are being conducted in both Hemispheres with infinite patience and perseverance. All the principal lines of food merchandise such as meat, dairy produce, fruit, etc., are having the mysteries of their behaviour under varying temperature conditions uncovered by a scheme of scientific investigation in which the best brains of the period are enlisted. New Zealand is in touch with the scientific efforts made in other countries in this Tast field of exploration, and the Dominion must be interested in many of the results which the Food Investigation Board in Great Britain is achieving in this area. The latest report of the Food Investigation Board, of which Sir William B. Hardy. F.R.S., is Director, concerns a subject which peculiarly applies to New Zealand traffic, namely "The Leakage of Heat into Ships' Insulated Holds". This report is the result of several years' experiments and observations carried out under natural conditions on board ship by trained investigators and with the collaboration of a leading firm of refrigerat'ng engineers, namely, Messrs. J. and E. Hall, Ltd., of Dartford, so that all the results might be fortified by the fullest experience. It ia thought that the results achieved may be very important for future produce carriage work. Character of the Experiment. The method employed iu the experiment was first to cool down the spaces, and then to stabilise the rate, of refrigeration at a value which would just suffice to maintain the temperatures steady. When this is the case the rate of leakage of heat must be equal to the rate at which heat is being removed by the refrigerating machine. In the present instance the temperatures of all the insulated spaces were held at about 6deg. Fahr., which was between 40deg. and 45deg. Fahr. below the temperatures of the atmosphereic air and the sea water. A state of approximate equilibrium was maintained for 17 hours, and during this period frequent measurements were made of the internal and external temperatures, and of the rate at which heat was being removed from each of the spaces. In view of the complexity of the structure of the insulation, and of the impossibility of measuring the actual temperatures of its various surfaces, the results have been expressed, not in terms of thermal conductivity, but merely in terms of the rate of leakage (in B.Th.U. per hour) per sq. ft. of exposed surface, per degrees F. difference in temperature between the external and internal media. The depth of the insulation is ignored in this expression, which for convenience has been termed the coefficient of leakage. The experimental data were found to give the following ▼alues for the coefficient of leakage: —

The results for all three sets of spaces can ia fact bo brought into line, if an allowance is made, for leakage along the decks, of about 65 B.Th.TJ. per hour pel ft. length of the periphery of the deck exposed to warm temperatures. The structure of the periphery of the deck is so complicated that an accurate theoretical estimation of the amount of heat leaking in by this path is almost out of the question, but a simplified calculation shows that the postulated value is at any rate not impossibly large. When this allowance has been made the revised values of the coefficient of leakage all approximate to 0.08 which ▼alue is still between two and three times as great as the rate of leakage through a uniform wall of granulated cork lOin. thick with a difference in temperature between its outer and inner surfaces equal to that between th« external and internal temperatures in this experiment. Sheffield's Great Example. Following the lead of the City of Sheffield (which it will be remembered opened its new abattoir and meat market recently) several other cities are considering similar schemes. In particular might be mentioned Liverpool. A contract for the erection of the abattoir has been placed but is not yet definitely signed. It is expected, however, that work will be commenced shortly. The Sheffield abattoir is of double significance in that the design and construct stand to the cerdit of a New Zealander.

Caseous Lymphadenitis. Present indications lead one to believe that the great handicap at present placed on the meat industry by the lymphatic gland trouble many shortly be removed. In fact, it is almost a certainty that by July Ist the 100 per cent. examination will be abolished in favour «( I 10 per cent, examination. Last month, out of 14,106 Australian mutton carcases examined in the City of London only 1.55 per cent, were condemned as being diseased or ex-glands, and we have it on authority that as soon as the figures warrant it, a return to the 10 per sent, examination will be made.

COMPANY FINANCE. CAPITAL OF NEW CONCERNS. One of the most objectionable features of company promoting in recent years has been the absence of sound principles in regard to capitalisation, the city editor of '-'The Times*' wrote recently. These principles were well recognfsed before the war, and were fairlv generally adopted, but they have been" openly violated either in lgnoranco or in contempt of them by newcomers to the world of company finance. It is not uncommon nowadays to find a company capitalised as follows: 000 of share capital, or with £1,000.000 of preference shares and £200,000 of ordinary shares. A company with a share capital of £500,000 is not in a position to issue £1,000.000 of real debentures, that is, a stock with a properly safe margin of security behind it. If the amounts were reversed — that is to sav, £500,000 of debentures and £1,000,000 of share capital behind them —the debenture would have something more than mere hope as its security. The same argument applies to preference and ordinary shares. For preference shares to have a real preference, there must be a substantial amount of capital ranking behind them, otherwise their preferential position is more apparent than real. It is sheer audacity for company promoters to invite the public, as they not infrequently do. to subscribe for, say, £500,000 of preference shares in a new and untried company, with no record of profits behind it, with only one-tenth of that amount in ordinary shares, this being the only margin ot security. Obviously, preference shares in such a case have a preference over virtually nothing They merely enjoy the doubtful pleasure ot providing the bulk of the money, which may be lost if the venture fails, while another party—the ordinary shareholderstands to gain most if it succeeds. A company saddled with disproportionately heavy prior "barges finds itself in difficulties almost at once if it should strike a lean period. It requires a substantial margin in its trading profits to enable it to meet the interest on its debentures, and one lean year may be sufficient to place it m default. Similarly, a disproportionate amount of preference shares in comparison with ordinary capital exposes a company to troubles hardly less difficult in bad times, for although the company may not have to seek a moratorium, as would be the case in the event of rion-pavment of debenture interest, or alternatively obtain temporary accommodation on onerous terms, it builds up arrears of dividend which compromise its credit and reduce its chances of recovery.

NEW ZEALAND TOBACCO. EXPORT GUARANTEE EXPIRES. The erroneous impression that a Government export guarantee exists upon New Zealand-grown tobacco was referred to the other day by Mr J. A. Campbell, of the Horticulture Division, when discussing the prospects of the establishment of a proatable tobaccogrowing industry in the Dominion and the interest that is being taken in the project in Auckland as well as in other parts. Mr Campbell said that some misconception existed regarding the export guarantee and he wanted to make the position quite clear. In 1925 the Government agreed to a liroated guarantee scheme for a period of three years. That arrangement expired with the 1928 season, and consequently no such guarantee now applied. AMERICAN HIGH TARIFFS. INFLUENCE OF FARMERS. "Congress has been for some months now dealing with the question of tariff," Mr F. J. Needham, commercial manager of the New Zealand Refrigerating Company, Christchurch, told a Prkss reporter yesterday. "The one idea seems to be to assist the farming community,, and they were practically unanimously in favour of passing such tariff and placing in the hands of the President full power to enforce the new duties, but there was such an outcry from the business eomI munitj of America that it is more than possible that such tariff alterations will never come into force." ' The people of America, Mr Needham said, realised that in their endeavour to assist the farming community Congress was going to penalise heavily the whole consuming public. The American herds during the war were very much depleted, and have not been j.roperlv built up, and the coming into force of the tariff alterations would me<in that those controlling meat supplies could ask .my figure, practically, that they wished. Another aspect has been fully considered by the various Chambers of Commerce, and that is that these high tariffs of America may become somewhat of a boomerang, and America may be placed in a position of splendid isolation. This view is strongly held by the business community, which will do all possible to stop the high tariff from being enforced against foreign countries. "I was not able to get into touch with the political side," added Mr, Needham, -'to determine if any real endeavour is being made by the politicians to assist the farming community, but the bueine" men did not hesitate to say that thtie was an undercurrent legnrdine this tariff scheme, especially in California, which was not genuine.

DEAR POTATOES. BOYCOTTED BY SYDNEY HOUSEWIVES. (united tress association— by electric telegraph— coptright.) (Received July 18th, 10.35 p.m.) SYDNEY, July 18. The Housewives Association of Sydney to-day decided to institute a boycott on potatoes until merchants ceased to corner the market, as they are alleged to be doing at present. One woman speaker insisted that consumers should demand the lifting of the Federal ban on New Zealand potatoes, but the chairwoman answered that that would take too long.—Australian Press Association. THE TASMANIAN CROP. (Received July 18th, 10.36 p.m.) SYDNEY, July 18. Reports from Tasmania state that recent floods and frosts have partly spoiled the potato crop.—Australian Pi ess Association,

Upper Main Space. T.Dt.. T.Ds. Holds No. 3 spaces . . 0.14 0.26 0.08 No. 3 spaces . . 0.13 0.22 0.09 No. 5 spaces . . 0.12 0.17 0.07 No. 6 spaces . . 0.13 0.23 0.07