Miller backs quotas

Press, 26 April 1984, Page 26

Miller backs quotas

Abolition of flour quotas could allow the linked Wattie’s and Goodman’s groups to obtain a complete monopoly- of the milling and baking industries, says Mr Jack Brand, chairman of the Canterbury Roller Flour Mills Company, Ltd, in the annual report.

An official committee has recently recommended that quotas be abolished and that flour prices should be “decontrolled” from February 1, 1987. “With 60 per cent of the flourmilling and baking in New Zealand under the control of the Wattie’s-Goodman group, the abolition of the quota system would allow complete monopoly to fall into the hands of this group,” Mr Brand says. .. He adds that the group has acquired milling interests in Australia. Under CER, these facilities could be used to supply New Zealand bakers, he adds.

“We consider that our mill could compete in an opencompetition situation, but with the Wattie’s-Goodman’s strength and resources, small mills and bakeries would soon be pushed out of business.” Tne possibility of monopoly control should be seriously considered before the quota system is abolished, says Mr Brand.

As previously reported, the company reports a tax-paid group profit for the year to December 31 of $87,793, 3.4 per cent down on the previous year’s profit of $90,858. Flour sales decreased 5 per cent to 5744 tonnes. Stock feed sales were also down on the previous year, when there was a drought. Milligans Eclipse Flour Company, Ltd, of Oamaru, in which Canterbury Roller Flour Mills has a 40 per cent holding, had a successful trading year, but extensive repairs and maintenance reduced net profit to $37,935, compared with $73,009 the previous year, Mr Brand reports. The directors recommend the dividend remain 20c a share (20 per cent). The retained earnings account now stands at $460,271, compared with $393,535 the previous year.