Sunshine and shadows again in 1973

Press, Volume CXIV, Issue 33424, 4 January 1974, Page 11

Sunshine and shadows again in 1973

Prom the point of view of product prices the past year has been a very good one for the farmer, and in particular the sheepfarmer.

With some fluctuations, wool prices have continued at boom levels. In the season, which ended in Canterbury in May, farmers who sold their wool at auction in Christchurch and Timaru realised S6sm for their product — a “mere” $36.5m more than in the previous season. And in a situation of red meat being in short supply, lamb, mutton and beef have been commanding record prices. Who would have dreamed two years ago, when the Meat Board intervened in the market, that the export killing season would have opened in October with the prime 301 b lamb, with a wool pull of 0.75 kilograms, being worth more than $11? But as always in farming, conditions are seldom quite as good, or as bad as they seem.

In Canterbury last year the effect of boom prices were offset by protracted drought, which in Mid and North Canterbury extended over most of the period. It meant that there was no opportunity in the autumn to build up feed supplies for the winter and early spring, and as a consequence there was a decline in the condition and performance of stock, and on top of this came a once-in-25 years snow storm in early August in much of the inland areas of the province, dealing a further grievous blow to those already weakened stock. Apart from considerable losses, this has meant lower lambing percentages and reduced wool production, both in quality and quantity. In two other ways the year has also been 'marred. One of these has been the division among sheepfarmers on the question of whether the new Wool Marketing Corporation should have the power to move into compulsory acquisition of all shorn wools and market them. To a degree this controversy is linked with the other unhappy aspect of the farming year — relationships between the new Government and the farming industry. To be true the wool acquisition and marketing issue was the subject of intense debate long before the Labour Government came to pow’er in November, 1972, and because of the obvious degree of opposition to the acquisition clause in the Wool Marketing Corporation Bill the old Government wrote into the legislation a provision making acquisition of the clip subject to a referendum to be held not before January this year. But hardly had he taken up his new duties at the end of 1972 than the new Minister of Agriculture (Mr Moyle) with Wool Board support, announced to the industry his determination to reinstate the compulsory acquisition clause, without a referendum. This only heightened the debate and stirred the opponents of acquisition to declare that they would hold their own referendum to test grower opinion. This they did early in the new year, and the outcome was a more than two-to-one vote against the Wool Board’s proposals. Still, however, there was reluctance to accept this indication of grower feeling, it being felt that many supporters of the proposed marketing reform had not voted.

The real test, therefore, came in the middle of the year in the elections for 24 seats on the electoral committee, which elects grower representatives to the Wool Board. There was unprecedented interest in these elections, with all but one seat being contested, and the outcome was that although the elections showed growers to »be almost split down the middle on the question — 56 per cent being against and 44 per cent in favour of the proposals — the opponents of acquisition obtained control of about 75 per cent of the seats on the committee.

At the first meeting of the new committee in August it made its views on the proposals patently clear, although it is not opposed to marketing reform, and meantime the Wool Board’s plans have gone into cold storage though the board chairman (Mr J. Clarke), has expressed the hope that growers’ attitudes will in due course change and the day will come when the scheme, which he believes is in the best long term interests of growers, will be reinstated again. Quite apart from advantages and disadvantages of

the marketing plan, there seems to have been one lesson from the great wool controversy, and that has been that no matter how worthwhile a scheme may be, leading farming organisations such as the Wool Board must leave no stone unturned to carry it to growers and acquaint them about it before seeking to implement it. This may be a protracted and often frustrating exercise, because of the seeming apathy of farmers, but no organisation in the industry dare not go through all the motions. There is room to believe that the lesson is being learned.

After a period of virtual silence since the electoral committee elections, the Wool Corporation came up at the year’s end with a proposal for voluntary pooling of wool for sale to iron out fluctuations in prices, which is a characteristic of the auction system. The other feature of the year has, of course, been the relations between the industry' and the new Government.

It is clear that after a long period of National Government rule, many farmers changed their allegiance in 1972, and helped to sweep Labour into pow'er. But it is likely that in the past year the new Government has alienated most of its new farmer supporters. The main cause of complaint has probably been that the Government has seemed to have one set of standards for farmers and another for the rest of the community. It might well be argued that farmers as a whole are currently doing very well and can therefore bear a little more of the burden of the day than other sectors, but it seems to have been quickly forgotten that up until 1971 farmers had been going through a number of years ,of depressed prices, as well as difficult climatic conditions, and in their own interests as well as those of the country were long overdue for a change in fortunes.

Farmers accepted the Government’s “voluntarycompulsory” income freeze in a situation where there was a shortage of goods and sendees, and a need for some Control of inflationary pressures, and, in fact, from a recent statement of the Minister of Agriculture indicating that the freeze will be continued in the New Year, they deposited in the income stabilisation scheme some $9Om —more than the sBsm called for by the Government. However, they disliked the threat of compulsion, if they did not come to light voluntarily, and they also insisted that other sections of the community should shoulder some pari: of the burden of promoting economic stability. Of this latter, farmers do not. feel that there has been much evidence. ' The Government’s idea of a wage freeze was an 84 per cent w'age rise to start with, and lately a watering down of the freeze to give workers a bigger lift in wages than would otherwise have been the case to coun-ter-balance increases in the cost of living. And the farmers’ contribution has not just been confined to the income freeze.

In the Budget in June, Mr Rowling swept away subsidies on weedkillers, pesticides and stock drenches, aerial application of fertiliser, and lime, and re-

duced subsidies on fertilisers and its transport. Grain growers were unhappy about the imposition of a freeze on feed grains when they felt that many of their fellows using grains to feed valuable stock were in a position to pay higher money. Farmers were particularly incensed when in September, in association with the announcement of a 10 per cent revaluation cutting farmers’ returns from export produce, the Prime Minister also revealed details of a reference price scheme, under which export meat prices to the farmer would be pegged in the interests of reducing domestic meat priees.

This brought farmers together in opposition to the Government’s proposals in a way that has rarely been seen, and so far the Government, although under some pressure from consumer interests, has refrained from putting its plans in this respect into operation. Some part of farmers’ dislike of the Government has been its manner of handling some matters relating to agriculture.

For instance, after announcing its intention to look into the operations of the International Wool Secretariat in support of wool, apparently with the idea of assessing to what extent it should continue its support of that operation, Mr Moyle announced in November, ahead of the findings of the inquiry, a reduction from s4.Bm to S2m in the Government’s support. Just before Christmas, the Acting Prime Minister (Mr Watt), in indicating that a decision on the wheat price for the 1975 harvest would be delayed until mid-January, said this was a matter demanding no urgency, apparently overlooking that wheat is sown in the autumn and that farm planning is not a short term matter.

Likewise, also before

Christmas, Mr Moyle twitted the old administration for only raising the price of wheat 20c per bushel in 12 years when Labour had increased the price 71c in its first year. Mr Moyle was talking about a period when wheat growing was one of the most profitable of farming enterprises — according to information given at the Lincoln College field day last November it now ranks about fifth on their mixed cropping farm.

At the end of the year Federated Farmers released a report to the Agricultural Production Council on the constraints on agricultural output and the measures necessary to overcome them. A disturbing aspect of this report was that since 1967 sheep numbers have virtually shown no increase, and there has in the last few years been a marked decline in dairy cows. Beef cattle have been the only part of the livestock industry to show sustained expansion. The message was also that movements in stock numbers and farm production are directly related to the level of investment in farming, which comes largely from the farmer himself, and that if farm production in the national interest is to be expanded, then this demands a sustained investment in the industry.

While sweeping away support for farming in better times, the new Government has spoken about reinstating that support in less favourable times, and it is possibly in this direction, in the event of a downturn in farming fortunes that the Government could conceivably regain some of its lost prestige in the industry. In one area where the new Government seemed likely to help droughtaffected Canterbury farmers —in the implementation of irrigation—it has seemed to be tardy, but as the year

closed with the appointment of an officials’ committee to review irrigation projects and help recommend priorities and the release of two reports on the economics of irrigation in central Canterbury, hopes may be revived that some action will be seen in due course, but major irrigation schemes are not built in a day.

Farming is an uncertain business. For most of last year it seemed that the industry was likely to ride high for some time to come, with ail of its products in world-wide demand and in seemingly short supply. However, the unexpected has again clouded the scene—the fuel crisis and its possible impact on economic conditions tn many of this country’s mam markets.