N.Z. POTATO NEEDS

Press, Volume LXXXIX, Issue 27098, 22 July 1953, Page 10

N.Z. POTATO NEEDS

TARGET PUT AT 22,000 ACRES POWERS OF BOARD EXPLAINED To fill its requirements of potatoes New Zealand required to grow between 20,000 and 22,000 acres, the chairman of the New Zealand Potato Board, Mr F. C. Jurgens, told a meeting of growers at Darfield last evening. “However clever you may try to be it has happened that there “has been a surplus with 18,000 acres and a shortage with more than 22,000 acres,” he said, “but on the law of averages we feel that we should grow 20.000 to 22,000 acres. I think we can do that if we are prepared to work together for a common end.” Mr Jurgens said that last season the average had risen by 3000 acres to 16,000 acres. This had been the first season during which the board had had discretionary powers enabling it in any one season to vary the price by up to £8 a ton. “When the Government saw fit to grant our request for that power we felt we had got to the stage where we could reasonably expect to get growers back into the industry,” said Mr Jurgens. Investigations that had preceded representations for these powers had shown that 10 to IS per cent, of growers were making a handsome profit out of potatoes, 45 per cent, were making enough to carry on reasonably; but 35 per cent, were growing at a loss.

Mr Jurgens said that the board had been a little concerned when, in the first year with its discretionary powers, it had been confronted with a -disaster. In the North Island he believed that the disaster had been more serious than in the South. In many cases North Island crops had been a “washout” and others had yielded only one or two tons of table potatoes. The board had hoped not to have to use its discretionary powers, but in the North Island it had paid out full price under the powers, and growers in the South Island had received within £1 of that, and last week that amount had been added as an increment. The board in exercising these powers had still to obtain the approval of the Price Tribunal, said Mr Jurgens, but unless the tribunal could show good reason why the payment should not be made it could not stop it. The opening price for the new season’s crop would be £l7 a ton, £1 more than the price last season. The increase was to allow for the increased cost of production, including such items as fertilisers and wages.

Surplus Problem It was at this stage that he expected to stop rotten eggs or potatoes if his listeners had any, said Mr Jurgens. Should it happen, even with 18,000 or 20,000 acres under potatoes, that there was a slight surplus, the board might decide that it was not desirable to pay out increments. “I have been asked what the board will do if there is a big surplus,” said Mr Jurgens. “This is my opinion and I do not know if the board would sanction it, but I consider the only sane thing to do would be to bring the price back to cost of production or a lesser amount according to the volume of the surplus. The price may be lowered by a maximum of £2, so in the case of the new season’s crop it could not come back below £l5. “We grant increased price in years of shortage or disaster. I claim we who live in a democratic country have an obligation to the country. When the price goes up to give us a reasonable return on our production the public has got to pay. If Nature provides us with a bumper crop is, it not our duty to produce that crop at a reasonable price?’* If there was a heavy crop the cost of production a ton was naturally less, and by keeping the price down consumption was encouraged. Some potatoes had been purchased front Australia this year, Mr Jurgens said, but unless he was mistaken Australia would be in a more serious position for supplies than New Zealand by the end of the season.

The board had to prepare for times of surplus, he continued, turning to funds held by the board. What funds the board needed for this purpose nobody could tell. In a year when there had been a surplus while the industry was under Internal Marketing regulations, the pay-out had been £150,000. That had been at a time when potatoes were worth about £9 a ton. “On that you can perhaps figure out what would be required now.” Mr Jurgens said that the board would be pleased to see a small surplus. It would prove that its existence was justified—one of its principal objects was to meet New Zealand’s potato requirements. Board’s Funds The pay-out that the board could make in the event of surpluses was limited by the funds available. That had been questioned, he continued. It had been suggested that money might be lent from the Government to pay growers. He personally would oppose such a step to the last ditch. It would

be one of the worst things that could be done. Taking the over-all picture, in a year of surplus what the grower did sell would be disposed of at the fixed price, giving a better than average return, and he could afford to receive for his surplus according to the funds held in the pool. In a free market the price could disappear overnight and might drop more than 30 per cent. It would be folly to take money from the Government. What assurances had they that they would be able to pay it back, or would they wish to shoulder their sons with the responsibility for a, season in which they could have done without the payment. The board’s funds at present stood at £51,000 in round figures, said Mr Jurgens.

“We know perfectly well that last year there was a certain amount of what was perhaps slightly illegal trading," he continued. In 1951 the board had received levy payments on 61,955 tons, but last year payments had been made on only 19,000 tons. Revenue had fallen from £38,000 to £12,000. The board had not taken harsh measures though it had powers to do so, but it rather felt that it should treat the matter by asking growers for their co-operation as the board was really only the servants of the growers. “Any man who deliberately tries to evade paying his fair dues and is not co-operative is an enemy not only to himself but also to his country;” said Mr Jurgens. Mr G. H. Blair, representative of the central ward on the board, said that the discretionary powers obtained by the board were m his opinion “one of the most advantageous achievements of any board for primary producers.” Mr Blair said that he had recently been in Australia, and in his opinion the possibility of exporting surplus potatoes to Australia was “virtually unlimited.” That, he said, might seem a bold story when New Zealand had last year imported 30,000 tons, but it had to be remembered that last year the average yield in Australia had been nearly doubled. The reason that New Zealand had also been able to get some potatoes from Australia this year had been that “they had been obtained quickly from Tasmania before New South Wales people woke up.” There was no doubt about this potentiality, he said, and. he did not think that there would Be any possibility of the New Zealand price ever having to be reduced below the opening price.