SHIPPING IN WAR-TIME

Dominion, Volume 33, Issue 79, 27 December 1939, Page 10

SHIPPING IN WAR-TIME

Profits For Neutrals Experience is now disproving the common belief that shipping, as a whole, prospers in time of war, wrote the shipping correspondent of “The Times” last mouth. Some,neutral mercantile marines are already benefiting greatly, but large sections of British shipping are suffering, not because of enemy action directed against British vessels, but because just before the outbreak of war freight rates were low and, because of the measures of control now practised, earnings either arc strictly limited or do not exist. Voyages of tramp ships for which contracts were made before the war have resulted in heavy losses for their owners; in some individual voyages they have amounted to many thousands of pounds. This is because the poor rates ruling (before war broke out left no margins for contingencies. 'l'he contingencies materialized in the form of immediate and sharp increases in the cost of war insurance and in a great prolongation of voyages. The additional war insurance in respect of a typical cargo involved heavy expenditure, and ships which make the voyage from Argentina to the United Kingdom with grain have been twice as long on passage. With the idea apparently of helping to prevent rises in commodity prices, freight rates for British vessels are strictly controlled. All their voyages are subject to licence and if the rates were not approved licences might be withheld. Many of the rates of freight are now on levels at which profits are at least problematical. Delays during voyages are, inevitable in war conditions, and while the cost of keeping vessels waiting for convoy has now been met. to some extent, by the grant of a daily allowance when ships are chartered to carry Government cargoes. this does not provide for all other contingencies which may cause vessels to make deviations or to remain in port. The daily upkeep, including the bill for wages, added to the expenses and depreciation of the ship continues. Difference in Rates. Much higher rates of freight are now available for neutral owners than for British ships. As an example of precisely comparable trades the current controlled rates for grain cargoes by British ships from Argentina to this country are 32/6 a ton, while as much as 55/- a ton has just, been paid for neutral vessels. The difference of 22/6 for a representative vessel carrying 7200 toms of grain amounts to more than £BOOO. The following are other illustrations of the present wide discrepancies between the two sets of rates quoted in terms of tons: — Voyage British Neutral St. Liiwrencc-U.K. 21/- 50/(4/6 a qr.) Danube-U.K. .. . 32/6 45/-Alexandria-U.K. . 20/- 30/The final cost of war insurance for British shipping cannot yet be known, but since mutual insurance is employed for part of the protection, the ultimate cost for British owners may possibly prove to be higher than the present charge to foreign firms, which has lately been reduced. Certainly many neutral firms are faring financially very much better than British owners. If the present distinctions continue the effect at the end of the war must be immensely to strengthen neutral mercantile marines, while British shipping will sink to an even worse state than it was in recently when Government subsidies were found to be essential. British Cotton Goods Exports By Telegraph.—Press Assn.— Copyright. DONDON, December 25. Mr. Oliver Stanley, President of the Board of Trade, in announcing that the Government intended to fix prices for cotton, said a levy of not more than .Old. a lb. on raiv cotton was proposed in order to finance measures for the development of the cotton goods export trade.