The Press FRIDAY, JUNE 14, 1963. Future Of Wheat

Press, Volume CII, Issue 30157, 14 June 1963, Page 10

The Press FRIDAY, JUNE 14, 1963. Future Of Wheat

The persistent shortage of foreign exchange gives some

economic justification to growing wheat in New Zealand at a time of world surplus, since the 9,200,000 bushels produced last season saved something like £5 million in exchange. But the admission by the Minister of Customs (Mr Shelton) to Federated Farmers in Nelson that South Island wheat costs “ considerably “ more ” in the North Island than wheat imported from Australia gives a disturbing illustration of the cost of the policy to consumers in their capacity as taxpayers. The South Island price is 13s 6d a bushel and North Island growers have a premium of 2s, though this has not encouraged the spectacular increase in production that has taken place in the South Island, and particularly in Canterbury, under the stimulus of a higher price and the use of new high-yielding varieties of wheat. The Australian price in the 1961-62 season varied from 13s 5d to 14s 5d (Australian) f.o.b.—los 9d to Ils 6d New Zealand currency—and freight charges across the Tasman were slightly over 2s 3d a bushel. Freight charges between the North and South Islands are about 4s, caused largely by the lack of bulk-hand-ling facilities, so that even if Australian prices should rise.'Australian wheat could probably be landed more cheaply in the North Island than South Island wheat. If New Zealand is to

become self-sufficient in wheat, which would require an annual acreage of 300.000 at 50 bushels to the acre, complete bulk - handling equipment will be necessary to hold the price at a level comparable with world prices. Wheat-growing in Canterbury, which produces two-thirds of the New Zealand total at present, is reasonably attractive to farmers, since it generally fits in well with farm management programmes; but while prices for wool and lamb remain near present levels, the’ Canterbury acreage is unlikely to rise from the present 123,000 to the 185,000 which, it has been estimated, would be the maximum in the province, unless the Government increases the price. The savings in overseas exchange, in that event, would need to be balanced against the cost of the incentive to growers and the cost of inter-island shipments. Smaller local yields might not justify the cost of installation of bulk-hand-ling equipment. Whether, in these circumstances, continued encouragement of wheat-growing is justified is for the Government to decide in the light of market prospects for other farm products. The Government may get some help in making this decision from the report of the Committee of Inquiry into the Wheat, 'Flour, and Bread Industries, which is soon to be released. Whatever decision is taken, continuity of policy will be desirable.