WHEAT AND FLOUR

Dominion, Volume 11, Issue 77, 24 December 1917, Page 6

WHEAT AND FLOUR

NEXT YEAR'S PROSPECTS THE AUSTRALIAN PURCHASE STATEMENT BY MINISTER OF AGRICULTURE A statement regarding wheat and flour was issued on for general information by the Minister of Agriculture (Hon. W. D. S. \tacDonald). The Minister outlined :ne steps that have been taken by the C-t vernniout already to ensure an adequate supply of flour for local consumption during the coming year, and emphasised that New Zealand is getting bread cheaper than any other country in . the world except Australia. The statement was as follows: — On December 18. 1916, at a meeting of the Board of Trade, over which the Ministor presided, a resolution was carried to the effect that the Government be urged immediately 'o take steps to secure an option to_ rurchase one million bushels of Australian wheat for delivery in Now Zealand tnween August and December, 1917 ; and on the same date a rSpnrt setting forth the reasons. for the above resolution was presented to the Government. o'i receipt of this report he presented It to the Cabinet, and the_ Hon. the Acting-Prime Minister _ (Sir James Allen) communicated _ with the Right Hon the Prime Minister, who m London, with the object of arranging an option in London with the representatives of the Australian Government who, at that date, were oj.peotetf to attend the Imperial Conference^ On January 31,1917, on the Minister's recommendation, the Right Hon. the Acting-Prime Minister again cabled the Right. Hon. the Prime Minister in London to endeavour to fix the price to be paid by the New ZeaI.vr. l Government for Australian vheat at the samo rate as that paid by the Imperial Government. . On J [arch 13 he spin eot the Hon. the Acting-Prime Minister to communicate with the Prime Minister, stressing tho importance of _ bringing th» negotiations for an option to a head After further communications between London and New Zealand, tho Rt. Hon. the Prime Minister cabled on Anril 20 that the Commonwealth Government refused New Zealand s proposal to share in the Imperial Government purchase. Consequently, on April 23, it was arranged that ho should visit Australia at the earliest pcsnble moment and arrange a purchase of at jpast one million bushels. _ l*arly m May he proceeded to Australia t;. arrange this purchase, which was eomploted in Australia on May 21, when arrangements were made for the brst hv the s.s. on M a v *1. Tha first shipment nrriVed in Dmicri»i on -Tune 2. and the second *nmnient left Pvdnev on July 19. and arrived in Auckland on July W. Tlh> ,-fssell left Auckland earl" in Awni't for the thirrt shinment, and had W0 tons on hoard when the Me strik" commenced on Annust 6, 1917. The industrial i">- }. n!U - P 1 .'n Australia precluded niv further shinmonts, and ft was Tint nntil o"t,nber 10 that the stnko was declared off. Since that date tho Hoard of in coninnction with tho Muni-tion-,'and Supplies Department and himself, hsive been T n constant ''ominunication with the shippinr enmpaniep tn of tni? rnont from AnstraHa. Thrv an^avnnrto nrroPfe tnft Ovorßeas Committee for the utilisation of trn«sports for this purpose, nnt no to the present hnv> onlv "hie i" ; eenre one transport, the freight asked for j in other eases heinT ffohdiitive A Now' Offer.

On September 14, the Australian Wheat Hoard advis'd that it would not bo able to supply further quaiititiss of the New South l.vlo-16 orop from Sydney, but offered to suppi? the balance of the Government purchase from the 1916-17 crop. 3lr. Feirier, the New Zealand Governmerit Grader, on being .:onsultfid, stir.ngly recommended the New Zealand Government not to rccept anv of the current crop. Had the Australian strike not taken place. T.here would probably have been at least 300.000 bushels of wheat of the 191)-1 (3 orop secured in Sydney. The refusal of the "Wheat Board to supnly New Zealand's requirements in Sydney with any more of the 1.915-16 and the poor qualitv of the 1916-17 wheat, compelled the Government to endeavour to lift the balance of the New Zealand purchase from Melbourne, whore there wa-s little or no direct eornmtmication with New Zealand by the ordinary passenger boats. The- Govern- ■ raent hn<3 therefore to rely on tha speoial shipping arrangements that hart been made. Moreover, one small parcel of five hundred tons lifted by one < t the ordinary passenger boats from Sydney proved to be unsatisfactory as regards loss in transit, and the experience with this shipment showed that owing to the rotten state of the bags it was too costly to ship the wheat along with general cargo. Reply to Critics.

It has been alleged that the action of the Government, on the recommendation of the tioard of Trade, in recently prohibiting the importation of all classes of wheat and flour from Australia axcopt under permit has prevented individuals purchasing from Australia if they so desired. The inaccuracy of this statement, the Minister stated, is apparent from the fact that every permit applied for has been granted, with the condition in regard to wheat that it is free from weevil. This oondition is essential, as the Government has pmrohased the forthcoming New Zealand harvest and cannot risk weevils getting into the stores in New Zealand. The Government's action has «.lso been adversely criticised in that it fixed a maximum price for the 1916-17 crop and guaranteed to purchase the 1917-18 crop. The Minister wished to point out that had the Government not fixed inaximtini prices for the 191617 crop in New Zealand Hour would certainly have bean from £17 to £18 per ton f.o.b. south, and during the period of the strike in_ Australia, when tha shortage of supplies in New Zealand was common knowledge, it is hard to sav what price flour would nave soared to. New Zealand's experience during 1916 is. however, illuminative. It will be remembered that on October 31, 1916 a strike occurred in Australia which threatened to disarrange slapping between Australia and New Zealand, and the price of fionr immediately rose from £12 to £15 f.o.b. Lvttelton, although at this date there was still in New Zealand sufficient wheat and (lour to carry the Dominion over until next harvest. What the price of flour would have reached in New Zealand after August 6, 19]?, had no maximum prices been fixed, it is hard to say in view of the fact that there was a known shortage. There Wild probably have been a wild scramble for supplies and panic Vuyina on the part of the public. Again, had the bovennnent not guaranteed prices for tft» 1917-18 crop, there would havo Itesn vero little whoat grown iri New Zealand for the coming year, and the l)o----minion would finve had to Teiv for i s remrirernents on importation, tntis plotting an unnecessary burden on to the shipping snace and thereby adding to the difficulties of the position already acute. The nolicv of the TTmted States, the Canadian, and British Governments in guaranteeing growers prices in the vicinity of Bs.' por bushol shows tha

world's shortage that exists in regard to wheat, and the necessity for inducing growers to put forth every effort to cope with the situation. Anstraliw wheat lit for milling cannot be landed in New Zealand under 6s. 3d. per bushel, even if shipping were available, and the price guaranteed by the Government to the New Zealand farmer under these circumstances must therefore be deemed to be reasonable. Bigger Average Cropped. Generally speaking, the policy of the Government in dealing witli the wheat situation cannot bo said to bo prejudicial to the growers, as it has resulted in tin- growers sowing 2.93,000 acres in wheat, the largest area, with tbe exception of one year, sown since 1910. The miller has been benetited, as he bus been assured of supplies of wheat for gristing which ht would .iot have had had the Government not taken Btepy to encourage wheat growing, and the public has been benefited, as today it is purchasing flour and bread at cheaper rates than any other country in the world, with the exception of Australia.

In regard to the question regarding the Government's scheme for the purchase and sale of the forthcoming crop, Mr. Macdouald stated that the scheme adopted by the Government nas the ftult of inquiries made by the Board of Trade from farmers, grain merchants, and millers: On the information so supplied, the Board of Trade diafted a scheme and submitted it' to a'conference held in Christchurcji early in November, when it received the almost unanimous endorsement of every interest concerned. Under the scheme there can bo no speculation in wheatbuying. The farmer will receive the prie.) guaranteed by the Govern,nent. Approved grain merchants will act as agents' of the Government in handling the wheat from the farmer to the miller, and their remuneration covers their guaranteeing the Government against loss. . The miller will have an assured market, but will he prevented from obtaining undue profits by the fixation of maximum prices. The administration of the soheme has teen left in the Minister's hands, and Mr. W. G. M'Donald, of the Board of Tiade, has been appointed Controller, and will have the assistance rf the other members of the board >n carryin;; out his duties. The services of Mr. W. S.'Pratt have been generously lent to the Government bj tho National Mortgago and Agency Company. Mr. Pratt, who will act as Assistant Controller, has had wide experience in' even department of grain trade, and occupies a responsible p-aition with'.the company.