Inquiry Into Farming Investment Sought

Press, Volume CI, Issue 29913, 29 August 1962, Page 10

Inquiry Into Farming Investment Sought

(N.Z. Press Association) WELLINGTON, August 28. The Wool Board would welcome an inquiry into farm output and investment as suggested by the Monetary and Economic Council in its second report, the chairman of the boards (Mr J. Acland) said in his address to the annual meeting of the electoral college of the board today.

The economic service of the Meat and Wool boards maintained a continuous watch on the industry, said Mr Acland. The published evidence of the service's survey, he believed, was sufficient to show beyond question that on current trends farm output was not for long going to provide the requirements for growth in other sectors of the economy The Monetary Council's report. in a passage quoted by Mr Acland. said that if the likely rate of increase in farm output was below what was needed, “the Government must be prepared to formulate policies to increase the rate of farm investment ” “The College has heard me say. on former occasions, how important our increasing production of wool has been in maintaining New Zealand's export earnings and living standards in recent years." said Mr Acland Annual Increases “Since 1952, production has increased on average by £lB million a year Without the increase our earnings in the season just past would have been lower by some £3O million ” Whether the industry, squeezed between rising costs and static or declining prices, was going to maintain this increase in the next 10 years was a question of national concern. It was also of concern to the general fortunes of wool in the world, which depended to a great extent on maintaining an adequate supply for growing textile markets “At the rate at which our population is expected to grow, we shall have about

2.800.000 New Zealanders in 1969.” said Mr Acland. “Mr W B. Taylor, of the sheep and beef cattle survey, has calculated that if our living standards are not to deteriorate we shall want another 5.500.000 sheep and another 700.000 head of cattle Production Costs “Setting prices against costs, a unit of farm production today would buy only 75 per cent, of the productive resources that it did in 1950 “For example, a bale of wool in 1950 would have bought 100 wool packs or 17cwt of fencing wire or eight weeks’ shepherd's wages “In 1960. a bale would have bought only 70 wool packs or 14cwt of fencing wire or four weeks’ shepherd's wages "The only way out of this situation, of course, is to increase your output of ’units of farm production.’ and this the industry has done, adding millions to export earnings.” said Mr Acland “This has served the country well, but for the farmer, almost all the increased earning has been swallowed up in rising costs “The ultimate result must be a decline in production, and this has in fact happened in the last season. “This has been partly due to climate but we cannot gloss over the remorseless effects of economic conditions in the industry.” Pressure By Six Pressures could develop within an enlarged Common Market to restrict the free movement of raw wool and so impair a large part of New Zealand’s wool export trade. Mr Acland said. Those who thought that “wool is all right" if Britain

joins the market were oversimplifying the matter, he said “It will be change on such a scale as will affect potentially for good or ill the fortunes of every basic commodity going into Western Europe.’’ Looking at the brighter prospects. Mr Acland said the growth of business activity in Europe had stimulated the demand for wool. In 1957-58, New Zealand shipped 468,500 bales to the Six In 1960-61 the figure was 582,000. The corresponding figures for Britain were 527.000. dropping to 482,000. It was unlikely that this initial rate of growth would be maintained But for the present it was expected textile consumption in Europe would grow rapidly—perhaps 25 to 30 per cent, by 1970. Auction System The Wool Board was aware of "some reasoned criticism" of the auction system, but did not contemplate a change at present. Mr Acland said. Average wool prices were not likely in the near future to rise to the level of the midfifties, he said. On the other hand, he did not believe in an inevitable further decline brought about by a lowering “ceiling” created by synthetics pricey. Xavier Old Buys.— Officers ejected at the annual meeting of the Xavier College Old Boys' Association were: President. Mr P. J. Wills; vice-president, Mr M. Haughey; secretary-treasurer. Mr P. FaJicaner; honorary auditor. Mr P. J. Wills; committee, Messrs T. Greenlees, J. Mathews. B Graiham, L. Fitzgerald, P. Doig.