WOOL PAYMENTS

Press, Volume LXXIX, Issue 23917, 8 April 1943, Page 4

WOOL PAYMENTS

FARMERS CRITICISE DISTRIBUTION MR BARCLAY ADDRESSES MEETING (P.A.) WELLINGTON, April 7 “This meeting feels that a very grave injustice has been perpetrated in the distribution of the wool payments, and asks that a case be stated before a Judge of the Supreme Court with power to act.” This resolution was carried at a large meeting of farmers at Master ton this afternoon. The meeting was addressed by the Minister of Agriculture and of Marketing (the Hon. J. G, Barclay). Claiming that there was absolutely no case for any section of the wool industry demanding that the additional 15 per cent, be paid for local wool, the Minister said that the following six points constituted the full facts relating to the increase of 15 per cent, in the price of wool granted by the United Kingdom Government:— (1) At the outbreak of the war woolgrowers were receiving an average price of 9.17 d per lb, from which brokerage charges had to be paid amounting to about Jd per lb. (2) After the outbreak of the war representatives of the wool industry were requested by the Government to nominate a price at which a contract could be made between the United Kingdom and New Zealand Governments. As the contract period was for the duration of the war, this price was intended to, and did, take into account an assessment of likely increases in costs during the emergency period. The price recommended to the Government by these representatives was 12d per lb, but the New Zealand Government was finally successful in concluding an agreement with the United Kingdom at 12jd per lb, with all brokerage charges payable by the United Kingdom Government. Thus, in effect, the price secured at the outbreak of the war was at least Jd per lb higher than the industry itself had nominated.

(3) Last year the United Kingdom Government unexpectedly announced the further increase of 15 per cent., and this increase was not directly related to the assessment of increased costs of production in New Zealand, because no case in this respect had e\er been presented by the industry since the outbreak of the war. (4) Additions of this 15 per cem. on export wool meant an overall increase on the total wool clip of 14 per cent., or an increase of 61 per cent, on the basis of the price received at the outbreak of the war, a 50 per cent, increase on the basis of the last 12 years’ average, or an increase of 25 per cent, on the most favourable three-year period before the war.

(5) No other section of primary producers had received increases comparable with these figures since the outbreak of the war, while some award workers had received only 5 per cent, and others 10 per cent. (6) In these circumstances there could be no question of woolgrowers subsidising the rest of the community by stabilising the price of wool at its present level. The fact was that the comparative position showed that the rest of the community should not be requested to pay a tribute to the woolgrowers so that their present extremely favourable position could be further improved.

In short, said the Minister, the decision of the Government meant that woolgrowers received, either in cash or bends, the whole of the additional amount paid by the United Kingdom for export wool, giving a clear increase of 14 per cent, over the total clip whether exported or sold on the local market.

*u l MJ Vln l lster reminded the meeting that the American Government was unable to pay an additional 15 per cent on the issue prices charged it by the United, Kingdom Government, contending that these prices, with an increase of 15 per cent., placed the value of wool sold to it above world parity Consequently, the United Kingdom Government had agreed to allow America a discount of 6J per cent, making the increase on last year’s prices 7£ per cent. There were also heavy stocks of wool accumulating in ail parts of the world, and at present there were more than 500.000 bales of wool held in store in the Dominion.