WHEAT DUTIES

Dominion, Volume 23, Issue 7, 3 October 1929, Page 7

WHEAT DUTIES

“PROTECTION RUN RIOT”

VIEW OF MERCHANTS STRONG OPPOSITION That the protection on wheat had run riot was the opinion expressed before the Wheat Committee yesterday by a representative of the Wellington grain merchants, who strongly protested against the duty. The Auckland provincial branch of the Fanners’ Union was , stated to favour a subsidy as against a protective duty.

Mr. H. M. Rushworth, M.P. (Country Party, Bay of Islands) .moke on behalf of the Auckland provincial branch of the Farmers’ Union, which has a membership of 7000. He was opposed to a protective duty on wheat, but favoured a subsidy. The effect of a protective duty, direct and indirect caused the prices of flour, and wheat, offals to rise higher than otherwise. The price of the four-pound loaf in New Zealand was not less than Is. 3d., whereas in Great Britain the universal charge was Bd. In the city of Sheffield, due to.special circumstances, a very large firm running on mass production and using electrical machinery, turned out the loaf at Id. per lb.

Millers’ Profits Rising.

Witness quoted figures which he considered indicated that the gross profits of the millers seemed to be rising consid erably. He considered that the consumers here paid duty on the locally-grown wheat as well as on the imported wheat, and the Dominion had had to pay £5,000,000 over and above the world parity, for the protection of the wheat industry during the last 11 years.

Need of Independence.

Witness referred to the , dangerous position of the Dominion in the event of war if the communications were severed, and mentioned that high authorities held that the reason Germany did not attempt to land n invading force in Great Britain was not only that the Navy held the seas, but that the force, had it landed, could not have lived in the country, the food supply being sufficient for her own population for only six weeks. He was opposed to the tariff on every kind of stock food, and drew attention to the necessity for a balanced ration for pigs and poultry. Many farmers fed their pigs exclusively on milk products, but the bacon and pork was unsatisfactory without the grain food. To the Hon. J. G. Cobbe (Minister of Customs) witness agreed that wheat growers could not carry on without a definite subsidy. Mr. Cobbe: Would you place the subsidy on the wheat produced or on the flour?-—“lt would be better to put it on the wheat sold here. I consider the wheat growers would get the benefit of the subsidy. It should stimulate competition and prevent rings. Local millers should not require any protection against Australia because the wages are higher there."

Would it help the pig industry if the duty were removed from maize? —“It would be an important Help, but it is difficult to get maize now.”

To Mr. J. Bitchener (Reform, Waitaki) witness said the cost of fattening a pig was a matter of opinion, and he,could not say that 6001 b, of meal, etc., was a fair estimate.

Mr. H. R. Jenkins (United, Parnell): Do you consider the wheatgrower, with his present protection, is in a better position than the dairy farmer without any protection?—“Yes.” Questioned by Mr. J. MacPherson (United, Oamaru) witness agreed that it would not be justifiable to remove the wheat duty and leave the farmer without any assistance. The chairman: What has been the effect of the wheat pool?—“To increase the price of the milled product, and the price of wheat is raised also.” Do you infer that the millers’ profits have been excessive?—“The figures indicate that. The growers found it necessary to form the poo].” Grain Merchants’ View. Messrs. R. S. Cathie and S. Rowe, on behalf of the Wellington Grain, Seed and Produce Merchants’ Association, submitted a statement to the effect of the sliding scald of duties on fowl wheat and offal in the North Island. From 1879 to 1921 the biggest area sown in wheat in one season was close on 400,000 acres, while the highest crop on record was in 1899, the yield being 13 million bushels. Prices of fowl wheat under control—from 1916 to 1922—were substantially above pre-war prices, and in 1921 the duty was advanced from 9d. to 2s. per cental, or 166 per cent. The high protective duty in operation in 1928 had made the Dominion self-contained in regard to wheat, and had produced a surplus of from two to three million bushels. “Protection Run Riot.” Despite the surplus, the price of fowl wheat was firm, aud advancing, present f.o.u. southern ports being 6s. per bushel, sacks extra—equivalent to 7s. 2d., Wellington. Milling wheat was 3d. higher, or Is. Bu. to Is. Rd. above export parity. In the 18 years from 1911, fowl wheat had advanced from 3s. (id., sacks in f.o.b. South, to 65., sacks extra, in 1929. They considered that protection had run riot, and strongly protested against the duty. They contended the tariff was almost prohibitory, that the prices were unreasonable; while the growers of all other produce only received a return dependent on supply and demand. There appeared no prospect of the consumer - being given relief to-day, as there was a surplus of wheat and prices were steadily advancing. Mr. Cathie added: “It is now reported that many thousands of tons of wheat will shortly leave New Zealand for overseas. Current quotations for best milling wheat in Great Britain prove that this surplus is being dumped overseas at a loss of from Is. Cd. to Is. 9d. per bushel, apparently to maintain local prices.” Pollard and bran supplies were always short of requirements, and the shortage was acute. The present duty could be removed without harm to the millers. Poultry in the North Island exceeded the South Island by 50 per cent. He advocated the free entry into the North Island of fowl wheat, bran, and pollard, and a reasonably protective tariff to growers of milling wheat. To Mr. Cobbe, Mr. Rowe said he cstl mated the cost of sowing and harvesting wheat was from £8 ss. to £S 10s. per acre.

To Mr. I). Jones (Reform, Mid-Canterbury) Mr. Cathie said be considered It. possible to grow all wheat required in the Dominion at present, but with the increasing population that position might not continue.

Mr. Jones: What do you think would be a reasonable price for the four pound loaf? -—"I do not say it is now unduly high, but a duty that will bring the price ot wheat to 7s. lOd. must mean an Increase in bread prices, and poultry-keeping will cease." To the Rev. C. Carr (Labour, Umaru). Mr. Cathie said he advocated a definite scale of duty on milling wheat, which would stand for all time. A question by Mr. J. A. Macpherson ns to where Air. Cathie had got his evidence that wheat had been exported from the Dominion was disallowed, the chairman remarking that evidence would be led on that point later. Supply Well Guarded. Mr. R. W. Hawke. M.P. (United, Kaiapoi), speaking as a farmer and a poultrykeeper, stated that at recent conferences of poultrymen it was agreed that to put the local grain growers out of action, and rely on outside sources, was not in the best Interests of the Dominion, but that every effort should be made to obtain wheat as cheaply as possible. The Wellington market was the one the southern egg producers looked to to absorb their surplus. He considered that the question of the food supply for North Island poultry had been well guarded against all along the line.

"No cow farming has had the brains put into it that the poultry industry has,” concluded the witness.

The committee adjourned to Tuerday next,