FINANCE AND COMMERCE

Press, Volume LXXIV, Issue 22591, 22 December 1938, Page 11

FINANCE AND COMMERCE

FAT STOCK SELL WELL

WOOL MARKETING PROSPECTS

MINING

GREY* RIVER

INTERESTING POSITION OF CROSSBRED

YORKSHIRE NEWSPAPER'S COMMENT

KANIERI

(tboii ottb owx cobbespokdixt.) LONDON, November 28. Discussing the opening of the wool Bales in New Zealand, the "Yorkshire Post" says that it is doubtful whether, in recent years, the crossbred marketing season has opened in more interesting conditions than those of the moment.

Although statistics show that aggregate wool stocks in the United Kingdom are above average for this time of the year, the position of crossbred wool is exactly the reverse. Merino wool is in more generous supply. Consumption has recently been below normal, but consumption of crossbred wools has been brisk. This state of affairs has been developing gradually in the last few years, it is stated, so that the condition in some directions may be described as acute. During the last year the trade has seen a succession of abnormal phases of demand, both in England and on the Continent, with the result that reserves have been depleted considerably. The demand for Jubilee and Coronation decorations, an improved call for crossbred tops and yarns for Germany, a substantial export of tops to China before the Chinese-Japanese war, a 6udden extension in Russia's call for crossbred wool, and a more general European interest in such wool for purposes of uniform cloths, all in addition to a healthy, normal home trade, are sufficient to demonstrate the more complete clearance of crossbred wools and their products in the last year or tw«

As a result, consuming demand is nearer to current production of the raw material than at any stage teic cent years. So finelv are immediate available supplies of raw material that crossbred topmakers who may be invited to sell forward at less money for delivery early next year are very chary of such procedure. Whatever the more remote future may have in store, the immediate outlook for the New Zealand season foreshadows a strong opening to the sales, if only on account of pressure of urgent demand, the writer continues.

Subsequent prospects are more difficult to assess, and there are students of trade trends who advance certain theories on the ground that the general margin of difference between merino and crossbred wool values is narrower than usual. It is to be hoped that urgent needs -may not cause the New Zealand market to open on what might be termed a false basis.

WHEAT, FLOUR, AND BREAD INDUSTRIES

MINISTER'S COMMENT ON CONTROL SCHEME

CPiaaa ahocxatiox minuit.) WELLINGTON, December 21. Reference was made to-day by the Minister for Industries and Commerce (the Hon. D. G. Sullivan) to the gazetting of the Board of Trade <Wheat and Flour) Regulations, 1938, (Amendment No. 1. The Minister explained that the scheme of control in the wheat, flour, tad bread industries had continued to pperate very satisfactorily in the interests of wheat farmers, flourmillers, bakers, and consumers. It had not been considered necessary to make any changes, and it had been decided to continue the operation of the regulations which had served so well in the 1937-38 season.

The new regulations just gazetted were purely machinery, and merely toade such alterations in the principal regulations as were necessary to make them applicable to the 1939-40 season.

FLOUR, WHEAT, AND OAT STOCKS

QUANTITIES HELD IN DOMINION

CriUtSa 4BSOCIATIOM TKLEGEAM.) . WELLINGTON. December 21. A census of the stocks of flour, wheat, and oats in the Dominion was taken by the Government Statistician on November 30. 1938. when the following quantities were returned: — £lour, 14,627 tons; wheat. 2.192,246 bushels, including 2,025.613 bushels of nuums wheat: and oats in grain. 863.468 bushels. Returns were received covering all stocks owned or stored by millers, merchants, and farmers in the Dorainion with a few unimportant exceptions which would not appreciably affect the totals given.

BRITISH EXCHEQUER RETURNS

(Barnsß oiticxai. wibeless.i <Received December 21, 7.30 p.m.) -, 4 , RUGBY. December 20. 1.-W 3l ordinary revenue is £ 472.063.905 Scared with £461.854,746 a year ago. *gm expend'ture, less self-balancing f£*ns. is £713,767.375. compared with t 627,341,105 a vear ago.

LONDON BUTTER MARKET

1,, LONDON, December 20. #»* ? r is steady. New Zealand, choic?l raited Ills, unsalted none offerSli. Ustralian « salted 108s > unsalted

AUSTRALIAN GLASS MOVE HIGHER

Entries of fat stock were exceptionally heavy at the double market at Addington yesterday, but all classes sold well. The fat lamb sale was particularly good, rates exceeding export schedules. In a big yarding of fat sheep, there was an average increase in prices of Is a head. Good prime beef was 10s to 15s a head dearer with second quality unchanged.

Investment business in Sydney yesterday was very quiet, and price movements were within narrow limits. There was a good demand for Australian Glass shares, which moved up to £5 6s 6d.

In Melbourne, industrials were steady, but barriers were easy. Bonds were firmer.

The feature of business on the local exchange was activity in Grey Rivers and Mount Morgans at advanced rates.

The Grey River dredge first clean-up for the period ending December 19 is 217 ounces for 218 hours and 113.067 cubic yards.

The Kanieri Gold Dredging Company reports that the trial run was satisfactory, and that the dredge began operating one shift a day on Monday, December 12.

PLACER DEVELOPMENT

Placer Development, Ltd., reports that for three months to December 1, 1938, Pato Consolidated Gold Dredging, Ltd., dredged 3,890,000 cubic yards for a recovery of 13,61 loz fine gold, and recovered with its hydraulic units 12370z fine gold, the value of the total production being 519,680 dollars. During the same period Asnazu Gold Dredging, Ltd., handled 421,000 cubic yards, recovering 31190z fine gold, equivalent to 109,165 dollars. Butherglen Gold "Dumps, 1A6... paid a dividend on December 8 of 5s (Australian) a share, and Gold Dumps Pty., Ltd., on the same date paid a dividend of Is (Australian) a share.

FOREIGN EXCHANGES

QUOTATIONS FROM BANK OF NEW SOUTH WALES

The Bank of New South Wales quoted the following exchange rates yesterday:— Buying. Selling. N.Z. on London— , „ , „„_ £N.Z. to £IOO Stg. T£. m/w- UjS^ Australia — .„ £Ato £IOO N.Z. T.T. 100/10/- 100 O.D. 100/10/- 100 FiH — £F. to £IOO N.Z. T.T. 90 H'™'* O.D. 90 88/12/6 New York— Dol to £1 N.Z. T.T. 3.7619 3.7130 ijoi. to *.* «. od 376gg 3714Q Montreal — Dol. to £1 N.Z. T.T. 3.8029 3.7428 O.D. 3.8116 3.7438 Belgium— Belgasto£l N.Z. T.T. 22.424 21.884 B O.D. 22.499 21.889 Czechoslovakia — Korunas ««„„„ to £1 N.Z. T.T. O.D. Denmark— „ Kronerto£lN.Z. T.T. Finland— «„. „« Marks to £1 N.Z. T£. 188.15 176.00 O.D. 186.55. 176.10 France — . Francs to £IN.Z. T.T. 144.61 139.61 O.D. loo.bo Germany— Reichmarks ' to £1 N.Z. T.T. O.D. Greece— Drachmae to £1 N.Z. T.T. O.D. Holland— „ , Florins to £1 N.Z. T.T. 7.016 6.761 O.D. 7.056 6.763 ItalyLire to £1 N.Z. T.T. O.D. Java— Florins to £1 N.Z. T.T., 6.990 6.7-30 O.D. 7.030 6.732 ' Norway— Kroner to £IN.Z. T.T. 16.201 15.704 O.D. 16.261 15.707 Noumea — Francs to £1 N.Z. T.T. 149.61 136.11 O.D. Papeete— „ Francs to £IN.Z. T.T. 148.41 136.41 O.D. Sweden — - t Kronorto£l N.Z. T.T. 15.833 15.331 O.D. 15.893 15.334 SwitzerlandFrancs to £1 N.Z. T.T. 16.776 16.311 O.D. 16.881 16.313 Chefoo— N.Z. pence to dol. T.T. Nominal O.D. Nominal Hong Kong— N.Z. pence to dol. T.T. 18 7-16 19 3-32 O.D 181 19 3-32 India and Ceylon— N.Z. pence to rup. T.T. 22 9-64 22 41-64 O.D. 22 7-64 22 41-64 Japan— N.Z. pence to yen T.T. O.D. Manila— N.Z. pence to peso T.T. Nominal O.D. Nominal Shanghai— N.Z. Dence to dol. T.T. Nominal O.D. Nominal Singapore— N.Z. pence to dol. T.T. 34 29-64 35 19-64 O.D. 34 25-64 35 19-64

COMPANY NEWS

BRITISH TOBACCO

INCREASED SALES REPORTED

Increased consumption of tobacco last year was reported by Mr R. J. A. Massie, chairman of British Tobacco Company (Australia), Ltd., at the annual meeting in Sydney recently. Sales of the subsidiary companies were higher, and another large warehouse had been erected at Kensington to meet the increasing need for the storage of leaf. "Last September the excise duty on manufactured tobacco was increased by 8d per lb, and the subsidiary companies found it necessary to increase their prices by this amount," he said.

"There has been no other'increase in prices by these companies, however, despite increases in various costs during the last few years," Mr Massie said. "The directors hoped that the prices of raw materials would gradually return to normal, and, from advices received, it would appear that leaf prices in America have receded from the peak reached last year.

"Freight increases and the appreciation of the dollar against sterling, however, have to some extent offset the fall in leaf prices on the warehouse floor, as compared with last year." The Victorian Companies Act, which had been passed, but which had not yet come into operation, gave the Registrar-General power to consent to a company postponing its first annual general meeting after the act came into operation, Mr Massie added. No doubt was felt that the company would be able to hold its next general meeting in February, 1940, and to post copies of the consolidated statement to shareholders before the meeting.

Mr Massie said that the company was continuing its policy of encouraging local production of good quality leaf.

GORDON AND GOTCH

Business had been well maintained, but the fall in export prices was likely to have an adverse effect in the future, said Mr A. T. Jones, chairman of Gordon and Gotch (Australasia), Ltd., at the annual meeting in Melbourne last week. The Melbourne warehouse had been remodelled, providing muchneeded additional floor space.

WOOLWORTHS (N.ZJ

In making the announcement at the annual meeting of Woolworths (N.Z.), Ltd., in Sydney recently, oi the intention to form Woolworths I IN.Z.) Properties. lAu., Mr C. Scott. Waine, chairman, said that the accounts showed that the value of freehold had increased by £48,419 during the year. The board had intended to avoid purchasing freehold as far as possible, but the directors now found that purchases were becoming more necessary as business expanded. It was thought wise to separate the freehold investments from the trading activities in a manner similar to that recently carried out by the parent company, Woolworths, Ltd. The capital of the new company would be subscribed chiefly by the issue of preference shares, Mr Waine said.

Leasehold properties had been written off in previous years and expenditure on this account during the year had been charged against profits. Leasehold properties, therefore, constituted a valuable inner reserve. Provision for taxation was £172,340, Mr Waine said. Taxation represented about 9s in the £ 1 of the profits earned during the year.

LOAN AND MERCANTILE

ADVERSE TRADING PERIOD

TBOU OU» OWV COERBSPO«T>B»T.) LONDON, December 2. Net profits of the New Zealand Loan and Mercantile Agency Company for the year ended June 30 fell from £132,012 for 1936-37 to £82,365. This is arrived at after taxation and a provision of £43,255 (against £53,658) for exchange differences on conversion of profits into sterling. Differences amounting to £32,859 on additional remittances in the last year have been met from contingency reserves. A dividend of 2 per cent, (against 2i per cent.) is to be paid on the ordinary stock, and the balance forward is increased from £39,762 to £47,127. Main balance-sheet items compare as follows: Liabilities June 30, June 30. 1938. 1937. £ £ Issued capital .. 2,250,000 2,500,000 Capital reserve .. 250,000 General reserve .. 650,000 400,000 Debenture stocks 2,000,000 2,000,000 Temporary advances 438,342 105,788 Sundry creditors, etc. .. 831,259 1,156,412 Assets Cash with bankers 266,749 948,674 Investments .. 378.714 560,637 Sundry debtors .. 1,310,807 1,062,912 Secured loans, etc. 2,958,664 2,547,529 Merchandise .. 202,739 195,774 •Interest in subsidiary companies .. 329,339 304,719 Holding of, own deb. stock .. 300,000 300,000 Premises, plant, etc. .. .. 775,728 438,621

The directors report that the company's business in Australia and New Zealand was adversely affected by the fall in commodity prices, by serious drought conditions in Victoria and New South Wales, and by an outbreak of facial eczema and parasitical troubles among livestock in New Zealand. The season in South Africa was disappointing, owing to the fall in wool prices, and the reduced clip resulting from drought conditions. The directors regret to record the retirement of Mr W. H. Millward from the local board in New Zealand. His great knowledge and experience of the pastoral industry in New Zealand have been of invaluable assistance to the company. The "Financial Times" comments: ' It is unfortunate that the New Zealand Loan and Mercantile Agency should have encountered an adverse trading period so soon after the capital reduction scheme in 1937. The company is well known as the second largest wool-selling house in the world, with extensive interests in Australia, New Zealand, and South Africa. Following an excellent year for wool, livestock and other products the fall in, the price of wool last year made it one of the most disappointing selling seasons for a long time. The decline was mainly attributable to subnormal demand by consuming countries. A drop of 39 per cent, in net profit from £136,000 to £82,400, illustrates the effect on the company's earnings. At the same time, it is pointed out that figures of the profit and loss account are not strictly comparable, owing to a change in the accounting method." \

ASSOCIATED BANKS' DOLLAR RATES

The Associated Banks (other than the Bank of New South Wales) quoted the following dollar rates yesterday en a New Zealand currency basis. They are subject to alteration without notice:— U.S.A. Canada. (Per £1 N.Z.) Dol. Dol.

(BBITI8B OTriCIAL WIBSLBSS ) RUGBY , December 20. Par. Dec. 17. Dec. 20 Paris, fr. to £1 179.60 177 37-64 177 19-64 New York. dol. to £1 4.866 4.671 4.66} Montreal, dol. to £1 4.866 4.71J 4.71 Brussels, belgas to £1 35 27.75} 27.68 Geneva, fr. to £1 25.2215 20.66 20.64} Amsterdam. fl. to £1 12.107 8.592 8.58} Milan, lire to £1 92.00 88 13-16 881 Berlin, reichmarken to £1 20.43 11. 64 J 11.63} Copenhagen, kr. to £1 18.159 22.40 22.40 Stockholm. kr. to £1 18.159 19.42 19.42 Oslo, kr. to £1 18.159 19.90 19.90 Vienna, schgs. to £1 34.585 — — Prague, kr. to £1 164.25 136} 136} Helsingfors, , marks to £1 193.23 2262 226] Madrid, pesetas to £1 25.2215 _ — Lisbon, escudos to £1 110 110} 110} Athens, drach to £1 375 547J 547} Bucharest. lei to £1 818.60 . 660 660 Belgrade, dinars 376.3 209 209 Rio de Janeiro, pence to milreis 5.899 3 1-16 31-16 Buenos Aires, pence to dol. 11.45 20.64 20.57} Montevideo, pence to peso 51 18i 181 Bombay, pence to rupee 18 17 59-64 17 59-64 Shanghai. pence to yen * 81 81 Hong Kong, pence to yen • 15 15 Yokohama, pence to yen 24.58 14 14 Batavla, guilders 12.107 8.58 8.75J Warsaw, zlotys to £1 43.38 26.31 26.31 •Determined by price of sliver.

Selling— T.T. .. 3.70J 3.74 7-16 O.D. .. 3.714 3.74 11-16 Buying— T.T. .. .. 3.75 9-16 3.79J O.D. .. .. 3.761 3.80 1-16