Competitor’s View

Press, Volume CVI, Issue 31089, 18 June 1966, Page 1

Competitor’s View

“The Press” Special Service DUNEDIN, June 17. The Meat Board was criticised today for making a “too hasty” decision in recommending the use of meat industry reserve funds for a co-operative fertiliser works in South Canterbury.

Sir Carl Smith, ehairman of the Dominion Fertiliser Company, said the controversy in South Canterbury would not have arisen had the Meat Board made a less hasty and more thorough examination of the project.

“1 understand that it was admitted to the Electoral College at. its August meeting that such a thorough examination of the project had not been carried out,” he told Dominion Fertiliser shareholders at their annual meeting in Dunedin. He said the Meat Board had made a favourable recommendation to the Government, but this had been turned down by the Government on economic grounds. Later the Government agreed to reconsider it and referred it back to the Meat Board. Sir Carl said the Meat Board decision for the cooperative works had overlooked three vital facts —that another works would be operating in the district using a cheaper method of manufacture: that the potential of the area took into account districts that would never be

supplied from any works near Timaru, and that citing the success of Southland and East Coast co-operative companies had little bearing on circumstances in South Canterbury. ECONOMIC AREA Southland had an economic area into which 93,000 tons had been delivered in the previous year, a freight differential, and was not bounded on both sides by a competitor. The East Coast co-operative works at Napier also had an assured tonnage and a large freight advantage from the nearest works at Wanganui. None of these factors applied in South Canterbury. “All through this controversy we had tried to point out the economics of the position,” said Sir Carl Smith, “and if the Meat Board decides that another works costing £1.6 or £1.7 million, including a drain on sterling funds of between £600,000 and £700,000, is economic and this turns out later not to be, then neither the Meat Board nor the shareholders of the cooperative company can complain that they had not been warned.” He said the construction of the works at Seadown was well up to schedule and production was timed for April next year. The cost of the works would be about £300,000.