Farmers Think Rise Could Be Crippling

Press, Volume XCIX, Issue 29272, 2 August 1960, Page 14

Farmers Think Rise Could Be Crippling

(New Zealand Press Association)

OAMARU, August 1.

The effect on exporting industries could well prove crippling, said Mr W. Malcolm, Dominion president of Federated Farmers, commenting today on the increase in shipping freight rates. The temporary advantage gained by the dairy industry last season, because of a drought in Europe, had now passed, and the industry once again faced keen competition, he said. The meat and wool industry took a double knock, Mr Malcolm said. The increased freight on mutton would approximate 9d a head, and that on lamb was only slightly less. The significant factowas that much New Zealand mutton did not return a price equal to transport, processing, shipping, and marketing costs. The Conference Lines, no doubt, would argue strongly that much of this increased rate was attributable to political and industrial action in New Zealand over the last three years. ‘‘Virtual Monopoly” “The Conference Lines give a good service in- helping to ensure a spread delivery of our exports,” said Mj Malcolm, “but in examining the operation of what is practically a cost plus agreement many people may question the wisdom of granting a virtual monopoly to the lines. "Exporters in the United Kingdom—New Zealand's main market —must themselves be unhappy about the handicap which is now placed on British exports, which must compete in New Zealand markets with outside countries.’’ The announcement would be received with dismay by farmers throughout the country, said the secretary of Otago Federated Farmers (Mi C. D. Standage) in Dunedin today. The farmers would not automatically share with the chairman of the Meat Producers' Board (Mr J. D. Ormond) the opinion that the increase was fair and inevitable, he said. “They will wan* to know if there has been any real attempt on the part of the Conference Lines to combat the spiral of rising costs, or whether there has been real consideration given by the board to the possibility of making other shipping arrangements.” Farmers would also ask if the holding down of costs was to be expected from what was tantamount to a monopoly. Farmers would also want to know how energetically the Meat Producers’. Board was fulfilling its stewardship of looking after the producers’ and the nation’s interest, Mr Standage said. Mutton To Japan Farmers found it curious [hat when steps were being taken to develop mutton 'trade with Japan, an Urea not within the Conference Lines’ sphere, the rates to Japan, at 4d, were claimed to' be uneconomic. Permission was given by the Meat Producers' Board for a private exporter to charter non-Confer-ence vessels, and these measured up to board standards for equipment. The freight rate was attractive, he said. “The next thing farmers heard was that the Conference rate to Japan had been reduced from 4d to 3}d,” Mr Standage said. Farmers realised that the cost of building ships had risen steeply and there had been a steady rise in other costs, Mr

Standage said. They realised that in some ways the Conference companies had served New Zealand well, but they felt it to be esseptially wrong that competition should not operate in the industry.

There is too great a proportion of the wealth stemming from stock grown in New Zealand pastures, and processed by New Zealand labour, finding its final resting place in the accounts of other than New Zealand concerns and citizens,” Mr Standage said.