COMMERCIAL AND FINANCIAL.

Evening Post, Volume LXXVII, Issue 117, 19 May 1909, Page 4

COMMERCIAL AND FINANCIAL.

'Evening, P,° st - Wednesday, 18th May, Last week reference was made, to tho ftdoption by the banks of New South Wales of the extremely cautious policy pursued by tho banks of New Zealand. It would appear from later informatioa that some of the banks* customers are beginning, to "feel the pressure. These- it would seem are customers who have committed themselves without first consulting their bankers, "in the belief that they had ample security," as tho Sydney Morning Herald puts it, "wherewith to raise a necessary overdraft." This refers more particularly to 'customers with title deeds to offer, but which were not convertible at sight (less a margin) in gold. Precisely tho same thing happened in New Zealand, and more particularly in Wellington. The banks were faced with one of two alternatives': doing a class of business which belonged to trust and mortgage ■ companies, or guillotining accounts of this kind altogether. The la-t-ter course was chosen. It has been said before, but it may be repeated, that mercantile houses of , repute have, "been abie to obtain from the banks all reasonable amounts required for carrying on business. Heal estate security was not wanted. It waa. 'felt that there was altogether top much of it .hold against fairly substantial overdrafts — the value pi the security was not questioned for a moment. Tho situJition was pointed out to customers, and the overdrafts had to bo materially reduced. That process, has baen m operation for some months,' and is btill in operation; ' Tho building trade has necessarily been dull, and land speculation has been - checked. • Signs of the coming "blow" were discerned by those accustomed to scan tho financial horizon and sail was shortened accordingly, with the result that there is every prospect of the country coming through bad weather without' carrying: away a rope yarn. 'Again, so < far as New Zealand is concerned the exports have, been exceptionally abundant as recently published statistics show. To-da.y the state of_ the wool market is exceedingly gratifying, and vheat remains firm. The butter market j<? firm,- cheese i 3 steady. Neither the hemp -hor tho frozen meat prospects aro brilliant. In regard to meat, there is this fact : " tho bottom of low prices i 6 to be seen, and any day an improvement may be looked for in the quotations for New Zealand moat of _ all descriptions. The outlook for hemp is at present exceedingly gloomy. What the- banks have been doing is in 'some sort reflected 1 -in the- policy" of thp merchant and "'retailer. Credits have beerf closely scrutinised, and sound rather than* expensive'- Business has been sought for. Economics have been effected in management, even to 'the' 'extent of reducing 1 bonds and stocks havo been kept as bare as the particular circumstances of the houses affected will permit. There i*, on tho whole, a much better tome prevailing in business circles than in March and ' April.' Them may bo a dulness. Slackness, .is, likely to obtain throughout the winter months, but there is at present every likelihood, _ barring untqward disturbances, of business being op. a better and oertainly. a sounder basis by v the epring. ..w... WOOL. — The satisfactory nows from tie London wool market leads to the belief that the July and September sales will not see a retrogression of prices. The wjopl appears to be going^ ab once into the mi-Ufc"-! i?he -price of 40*s* % crossbreds tops, for the end of last week, 13d, is^ a satisfactory comparisons wi±h ( the lOid'of May, 1908. The May v 'appVokima'to 'values for the paat ten years are given as under for 40's crossbred tops at per lb: — 1900, 10£ d ;.. 1901, 9d; 1902, 8Jkl ; 1903. lOcl ; 1904, 14£ d; 1905, 13d; 1906» 183 d; 1907, 17id; 1908, 10id. The figures are for 'both April snd Slay of the years taken, and they are confined to Ws crossbred tops ; 60'b show much the same fluctuation of values. It will be saen that it is practically almost inft>cfes£blb ttf 'f precast "wool ' prices; • Political and other causes may cauSo a violent drop in a week; but if the war clouds are below the skyline then tho market is generally more certain., a-qd jt dp.es appear that affairs in tho Balkans are likely to secfcle down quietly once again, and that Ungland and Germany are on better terms — factors' whicH Tifid' their influence upon the market. Dalgety's .returns of wool exported in bales froia Australasia from Ist January to 30th April are as follow. — 1907-8. 1908-9. Australia ... 1,524,224 1,699,646 New Zealand ... 387,446 452,331 There TTas thus been an increase of 240,307 ba^ft^Ct^^^stKciaaa^.^or^.-tIW^ 1 season. • New^ZiTaland 'is tKe~ second' exporter in Ajijtralasia, tho exports of New South Wales heading tl\e Jis6 with -867,428- bales ;• NHv Zealand folding .with 1 |52,33a-, ! bales, '_ ancl Victoria,, -third- with 443; 999 "bales— a dqc'reaso of 7797 bales compared with tho previous season. Tasmania's decrease i 3 1536 bales, bul New Zealand has an increase of 64,885 bales. B.UTTEfii.A-Tfcerb; lis^inj? twdteVent in thg' butter- inarjc6t< rsQnsc^uenti upon tho finning of— Australian" Vices' ori"'Satur-' day, and Monday. Cables were received *onr Saturday giving 112s in Sydney, and ori^,Monday 116s was reported for choicest. Thg Australian market is, 'however, notoriously uncertain,, and. the prices wore nqininaJ. Two factors, it is believed, will lia~ve an influence .upon the local prices tins' winter — (1) The fancy prices for ch«ese will induce factories possessing dual pU&fcs to devofco , their attention to that product; and (2) the known shortage of bdtiter in ftc-rc this year -phon compared with the beginning of winter of last year. It is argued that the price cannot much lofager remain at ll£d per lb to retailese, an<J, that tho ptitd may be brought up to ls-4d, thus enabling the butter to be sold^ ,afc{.ls 2d, giving tlie retailer lJkt, which itdv contended is a narrow enough margin fofc;hirn to work upon. • Last week some fortunate buyers secured Taranaki butter at'ttOid; other sales made on Friday were lld!j and a New Plymouth output was placed at ll^d. This week buyers aro holding off, but the factories are firm pressing fo» ll^d.to llijd. Both, .buyers arid, factories," jre playing a waiting '.game. Ifcithe piicevjh. Sydney 'keeps high, New Zealand trill Ifiive a better chance of meeting South African requirements, and shijpld this be bo, then another firming clement will bo introduced into tho rni^ket. |or , local, requirements. The question of moisture- has been, made the most of,,T3y buyers at Home, who are by no means ignorant of what goe& on in New ZeslaiTd;" in' "so" far" as it'folates to their own* interests. At the- came time, it would seem that the moisture has been overdone; Sp long as tho moisture was from I 12ipor cent, to 13 per cent., and not much j butter was offering, buyers mado little or no profits. Beyond those points they do. not care to go. They argue- that ihore j is plenty of fre3h water to ba had in England,, and they havo strongly resented ! the practice of butter-makers w^o havo I taken full advantage of the limit of 16 \>ov cent. It is well known that New Zealand w*<3 largely used for blending withFiench, Dutch, or other butters, and its drynesa was its chief qualification for that purpose. Excepting exports tc Hie United j Kingdom (244,823 boxes), New South Wales lias exported to India, the East, and Africa 22,900 boxes.. Of this, Hongkong took 3220 boxes, and the Philippines 2780 boxes. The figures aro from lrt | July last to Ist May. New Zealand's seaeon, now practically over — although con,- j siderabTe shipments have been leaving by "afler-season" boats — is expected to conotitutn iv«};ecQi;d^n, regard^ to quantity, and tha priee*'is 'reviving «• 5. s ' * '' Chcesj'-^Tfe cheese-market wili require the closest. walchßig. '.',' 0h ifhe^ne hand, there is the High Commissioner's cable, putting the price at 64s for white, and 66s for coloured — although "a private cable received on Monday quotes.^cololtred at 675; and on the other li^nd-jt^tere i 3 the strong probability that, Cana'do*.. will have to be reckoned with this year, the cheese prospects. .in. that,. Dominion being exceptionall3;* A briglft. 'Several factories in the South, -particularly, have a6ld at s£d and sid fojt -futuye—dotivery ; to September, in fact. ." Torday thp output is worth 6d. Prices tff'-rheese- for the second week in May* of 1908 compared with those for tho current week are as follow: — 1903. 1909. Coloured ... 60s 66s Wh^. , ...„ „-•• s 64s The otitput* for this season has already boon much ia excess of that of last year.

London prices opened with 58s to 59s for coloured, and have been steadily rising up to last week when 62s for white and 64s for coloured was the quotation. Locally prices will harden iv sympathy with tho London market. Meat. — Tha quotations for mutton, as given in the High Commissioner's cable, 2id' to~ 3id for Canterbury, and 2id and 2ld"for North Island, are the lowest for many. "years. Tho price in May last year j. was 4id, dropping- to 4gd in June The lowest top price -as given by Weddels was in 1897, when s|d was the figure. Lamb:, tho eamo year dropped to 4£dThe 'market for both lamb and mutton has' been faHingi 6ince October la&t for lamb, .when it was 52d, and since August for mutton when the top rate was 4id. In The Post's London loiter, dater Blh April:' it is stated that light sheop under 561b3tfnet with a.fair demand at 3|d, 3|d , medjium weights sold at 3«d to 3id, and heavier grades were a slow sale at 2fd, 2ld. 1 ' "Best brand of North Island mutton 'ranges fi'om 2§d, 3id, according to weight, and ordinary North Island sheep sold at 2Jd to 2gd. Ewes were quoted at 2id. to 2|d. Thoro had been some diffic\\ljty in. finding storage accommodation in" the provinces, and the market was dull and weal: at about 2£d to 2|d per lb. The maVkec for frozen lamb had been favourably affected by the warmer weather, and there had been rather more demand. Best Canterbury brands , 281bs, 421bs sold at 44d to 4|d. with tegs at 4d. Best brands of North Island' lambs were quoted at about 4ad, and ordinary brands a,t 4id. _ In sympathy with the improvement in chilled beef, Now Zealand frozen beef was firmer for the hind-quarter, but fore-quartere were neglected and sold at low prices. For' the four weeks 28,012 quarters "arrived from New Zealand, 7675 from Australia, 'and 162,600 from South America. PRODUCE. — The oat market shows signs of 'weakness, which are attributed to the great ' difficulties being experienced in getting'^ freight. Last year freight was available' a,t 15s ; to-day 30s is asked, which is beyond shippers' ideas. B grade Gartons : PficaVfell id on Monday, and others wero similarly affected, prices for the former being Is 8d to Is 9d, f.o.b. South Island, with sparrowbills Id lower. Potatoes are firm at £4 2s 6d to £4 ss, f.0.b., .(-he hardening in price being- said to bo due- to the blight in Oanterbur and North Otago. Shippers sell at buyers' risk as to blight, and will give no guarantee as to freedom from tho pest, making it a condition to business that the potatoes shall be examined by buyer's representative before delivery. Onions are scarce, and tho quality is not very reliable, several shipments having been rejected at Lyfctelton. They range in price from £4 to £4 10s, tlio market being firm. WHEAT. — The wheat market remains 'firm in New Zealand in sympathy with the strong position at Home. In Dunedin 4s Id to 4s 4d has been asked for prime milling and up to 4s for fowl wheat. The San Francisco correspondent of The Post, writing on 15th April, refers to the Patten episode in the following terms: — ''Fortunes have been made and lost at Ctyeago in the pabfc ten days. It was at the beginning of las,t week that the price of wheat began to soar sensationally. Soon it was higher than it had been since the memorable Leitor corner. On the 7th 5s 3d was given for May supplies. Next day thero was a further advance, and tho professionals .who had thought a reaction certain, lost heavily; likewise on several succeeding days.' Yesterday buyers gave up to 5s 4id for May wheat. It seems that the advance is not altogether tho result of manipulation. English markets are correspondingly high, but James A. Patten has been selling all along, and has not taken the advantage that he might of the bull movement. Patten prophesied that the boom would come, and he has been buying largely in preparation for it. It is said that in two days he made a profit of £300,000. He denied that he was manipulating the market. He said he had sold 'cash stuff' at 5s lid. "For three or four years,' ho said, 'this has been coining. At tho end of each crop bins wero empty everywhere. With increasing population it wag obvious that Kooner or later the crop of ono year would be exhausted, before another crop was at hand. Last fall, if not earlier, I saw it coming. . . . Tho harvest was early last year; it hns been trying to cover thirteen months instead of twelve.' " TEA.— ThcTe was a rise last week of id per lb on fan'iings, and medium broken pekoeSj woro extremely scarce, all Blapdout tjuanties being eagerly enquired after. Arrivals in Australia during April havo been limited, owing to the high prices ruling in Colombo. Importers have taken advantage of tho occasion to clear up back numbers, and at the beginning- of t»is month there 'was practically no stock of first hand teas. The distribution of black Ceylon teas from Ist January to 22nd March was 28,135,8751b. of which 3,938,8221b camo to Australia and Now Zealand : almost as much as went to Russia, for the same period; but no green teas came our way, Russia taking 177,0001b. Russians affect Nejv Zealand in their strong competition for dusts and fannings — teas for which therft is a strong demand at all times in this country! Messrs. A. S. Patorson and Co. have received advice by cable of an advance of half-penny per lb on medium teas in the Colombo tea market. The reports from India give a very gloomy account of the prospects of the tea plantations. Everything points to dearer lea, and tho recent rises confirm this viow. Stocks of tea in London on 31st March wtro 17i million pounds less than the corresponding dale of 1908. The statistical position 1 is exceedingly strong, to which tho German proposal to use tea for tho army may materially contribute. The maTkel in Melbourne and Sydney is bare, and there are but small Fhipmenls afloat owing to high prices in Colombo.