LINEN FLAX INDUSTRY

Press, Volume LXXXIX, Issue 27225, 17 December 1953, Page 10

LINEN FLAX INDUSTRY

Future Discussed With Minister

FURTHER TALKS POSSIBLE The future of the linen flax industry in New Zealand was discussed with the Minister of Industries and Commerce (Mr J. T. Watts) by directors of the Linen Flax Corporation of New Zealand and deputations of growers from Fairlie and Geraldine, yesterday. The Winton district, another flax-grow-ing area, wts also represented at the talks. There have been recent reports that the closing of factories at Geraldine and Fairlie is likely. - After the talks, which lasted two hours and a half, the Minister, in a statement, said the board of directors and the management of the corporation had been keeping him fully informed about developments in the industry, and future prospects had been under consideration for some time. “World prices for flax have been falling for some time, with the result that there is a big disparity in local and world prices, he said. “Today we had a very friendly discussion, and I undertook to give consideration to the representations they made, and they undertook to study figures I gave them and to let me have their opinions on them.” »

Mr Watts said there could be another meeting if the growers wanted one.

“At this stage I would like to pay a tribute to the work of the directors of the corporation, to Mr F. Johnson, and the management under Mr H. D. McCrostie, who has shown great efficiency in running the corporation in- face of local and international difficulties,’’ said Mr Watts. At the conclusion of the talks, the board of directors held a meeting, but no report of the discussions was available. According to the annual report of the corporation for last year, sales of fibre and tow to a rope and t vine company showed a substantial drop, which was caused to some extent by the shipping strike. Orders which had accumulated during the strike were delivered over a very short period at the end of 1951, with the result that the company was overstocked, and it was June, 1952, before they required fresh supplies. The slump in textiles in the United Kingdom affected the flax market to such an extent that prices for both fibre and tow dropped below cost of production. The corporation preferred to hold surplus fibre and tow and no sale of accumulated stocks was made overseas during the year, said the report. Although the years 19b0 and 1951 showed profits on operations, in 1952 a loss of £18,239 resulted. Stocks of fibre and tow surplus to the requirements of the rope and twine company were valued at current market prices, and although these valuations were well below the cost of production, t.he corporation’s costs were approximately those of the main producing countries, said the report.