Basic Wheat Prices For 1969 Announced

Press, Volume CVIII, Issue 31587, 26 January 1968, Page 1

Basic Wheat Prices For 1969 Announced

(From Our Own Reporter) WELLINGTON, January 25. Basic wheat prices of $1.35 a bushel f.o.r. to South Island growers and $1.55 to North Island growers for the 1969 harvest have been approved by the Cabinet. This was announced today by the chairman of the Cabinet Committee on Wheat Prices (Mr Adams-Schneider).

The new prices, for wheat harvested in 1969, are 10c a bushel lower than those for the 1968 harvest.

From these prices to growers a sum of up to 10c a bushel will be withheld from payment and retained by the Wheat Board to meet possible losses in storing and marketing wheat from the 1969 harvest, after making appropriate allowance for the loss on any surplus wheat which may be carried over from the 1968 harvest.

The 10c will be returned to growers in part or in full after the end of the 1968-69 season if no loss, or a lesser loss than the-sum retained, arises from the disposal of wheat from the 1969 harvest. The premium on Hilgendorf wheat is reduced by 5c to become 15c a bushel, and the discount on Arawa is increased by 3c to become 5c a bushel. Storage Payments Storage payments to growers will be continued on the present basis, but will be subject to an extension, if necessary, after experience with the 1968 harvest. Mr Adams-Schneider said these decisions had been taken by the Government after a thorough examination of wheat production and prices by both the Wheat Board and the Government. Mr Adams-Schneider said a heavy increase, to about 300,000 acres, had taken place in wheat sowings in the 196768 season, > and the expectation was that this area would produce a surplus of wheat to requirements in 1968, provided no serious setbacks to the harvest occurred. Less Consumed Part of the reason for the Government’s decision was the fall in the consumption of wheat, already apparent after the removal of subsidies from flour and bread, and expected to continue in 1968 because of an anticipated partial displacement of wheat for feed by the heavy additional production of barley and maize this season. In these circumstances, to avoid the accumulation of further surpluses, the Government considered it advisable to set the prices for the 1969 harvest at the levels now announced, Mr Adams-Schneider said. While these prices were estimated to provide a return to the grower which com-

pared favourably with that obtainable from other farm; products, it was hoped there would not be a surplus of wheat from the 1969 harvest additional to that expected from the 1968 harvest. The present Hilgendorf premium of 20c a bushel was intended to equate the return to growers with the return from the higher yielding Aotea. Hilgendorf, on a threeseason comparison, was yielding much better than this, and a payment of 12c a bushel would equate the yield of Hilgendorf with that of Aotea. To allow a generous tolerance in favour of Hilgendorf, and to provide continuing encouragement for its production. a premium of 15c for Hilgendorf would be paid in 1969. Bakers Reluctant Arawa was generally of a lower baking quality than Aotea and, because many millers were reluctant to accept it, this wheat was being relegated increasingly to feed use. It was considered that in these circumstances the discount of 5c announced for Arawa was justified, Mr Adams-Schneider said. Should Arawa present a disposal problem in 1969, it

might be necessary to impose a larger discount than 5c on it for the 1970 harvest. Mr Adams-Schneider added that in the current economic circumstances, the prices now announced should prove favourable to the traditional wheat grower and, in the absence of any unforeseen circumstances, attract a sufficiently large area of wheat sowings in 1968 to ensure New Zealand's independence of imported wheat supplies in 1969.