COMMERCIAL & FINANCIAL

Evening Post, Volume XCV, Issue 140, 13 June 1918, Page 4

COMMERCIAL & FINANCIAL

Evoning Post, Thursday.

Particulars, giving' reasons why the Btiiish Government flat rate of wan- risk insiirstncQ on cargoes has been abolished, a.ro contained in the, Board of Trade Journal. In the .original scheme the- flat rate was adopted ns speed and simplicity wore essential, and it was also held that, the system^ of covering wmt risks should be kept _ distinct from the insura-noo of marine nsks, so that the ordinary livaohinery of the insurance market mirfit W kept goin^. The flat rate provided that the. premium should not be less than 1 per cent, nor more than 5 per cent.. The rate began at five guineas, and was from time to time reduced until 1 per cent, was maintained for a. long period. Tho Buhmturino activity, however, accounted for increased ■ losses, and tho ralio gradually advanced to 5 per cent. The disadvantage of the flat r.a-to then became apparent, as insurance on hazardous journeys formed the principal business with the war Tisks office, ajid most of less hazardous risks were insured in tho market. Tho tendency was always for tho befit risks to go to tho mwrket, and the -A-oirsb risks to tho Government. The only remedy, therefore, was to abolish the fiat rate, and to insure cargoes at premiums graded from, time to tamo according' to tho actual'risks incurred upon pwrticulair voyages. In carrying out the new echemo tho Government will, as before, bo assisted by Tcproseni&tiveß of the insurancemarket, and a, special committee will sit daily to work tho scheme. The open, market in war risks will remain in existence, and fchero will be no compulsion upon anyone to insure with the Government War. Risks Office if he prefers to place his risk on the market. |

Reporting on 15th May, T, J. Thompson and Sons, Sydney,' state with reference to the recent £40,000,000 Commonwealth War Loan,, that "with public attention directed to that ffreat and successful effort, it was no wonder that othor investments showed some slight signs of weakness. The ordinary turnover slacked. Far some days past there have been more, evidences of enquiry and strength. The fluctuations of tho month have boon small, but tho shares of the two greatest Now South Wales banks have improved. As a rule the April dividends have been satisfactory, and very possibly tho market will revive, when tho. second of the heavy income-tax payments is out of hand, for those payments on top of tho War Loan a.re a (wain upon the. community. Mining shares, which had a, marked set-back a month ago, have noticeaMy revived." Reverting to the Forty Million Loan, it is reported: "Possibly the small subscribers might have been more numerous, and we do not rival the American multitudes' of. applicants, oven proportionately. But tho large subscribers filled-the void. It is of significance that tho tax-free 4& per cents, absorbed seven-eighths of the subscriptions, and investors should Tomomber that those 4A per cents, are now a closed security, and will doubtless bo in increasing demand in consequence. As for the taxable 5 per cents., there is, as yst, no clear indication as to their market value, but it appears/ probable the Federal Treasurer wiU have to provide Eomo additional stimulant to tho market and to investors if taxable issues are to bo made an equal success. Wo consider the difference between taxable and non-taxable, securities •amounts to more than .A .psr cent, per annum in interest And subscribers need an assurance that -their principal will be intact during the currency of the loan. But,tho fact remains that a-good. mar,y pcople_ have forestalled their savings for a. considerable time in their subscriptions, ajid roughly.-40'per cent, of the loan was taken up with bank assistance."

WOOL.—Valuations 'of this , season's crutchings are now proceeding at various stores. Export duties are now levied on wool oxported from Argentina and Uruguay. Tho specific export- duties previviously ruling on wool have been'converted into a 4 per cent, ad valorem tax. The Argentina tax is for the current calendar year. SAn export duty of 12 per rant, is imposed^ upon the difference batweon the basic prices and the current market prices.' This differenco is fixed monthly .by-a board of appraisers appointed by the Government. The tax came into force on 18th January last. Basic prices arc doSned within four zones, and the zone of production of the wool for -.the purposes of establishing the corresponding, basic price and appraisement has .to be proved by the presentation-of the transit permit, waybill, or .bill of lading in the manner prescribed by the , executive power. Clause 20 of the Act states that the law having established a. differential duty on wool, according to its piece of origin, oxporters shall give proof of the district of production of that article, exhibiting the certificate of the Ideal authorities who necessarily have to intervene- in the removal of the produce, disregarding the important vouchers referred to in. Article--591 of the ordinances, seeing that the port of shipment of ;the wool dors not afford sufficient evidence- of the .district 'of its production. Reference was made in a. recoht_ cablegram to the proposal of the Imperial Government not to acquire tho next South African wool clip, thus leaving growers to find their own mark St. As bearing on this matter, it may be stated that the_ Union Minister of Agriculture, in rsplying to a petition of certain farmers to approach the. Imperial Government with a. renewal of.the South African wool purchase offer, on the terms accepted last season, stated that, in view of the reception of the previous offer by a- largo section of the community, the Government was not justified in approaching His Majesty's Government, again. In February .last tho Nationalist fsnti-Impcrialist) Party submitted a motion of no-confi-dence in the South Africa-n House of Assembly, condemning the Government for having sold wool to the British Government, and charging tho '.utter with ' having made millions out nf the transaction. The Government stated that if England had not bought the wool there would have been a surplus of 275,000 bales, as Germany was no longer a purchaser. The insinuation that the British Government made money out of the transaction was indignantly rfissnted,' and the motion was defeated by 77 to 27.

DAIRY PRODUCE.—It is reported that some -factories aro parting with butter at under Is Sa per pound at factory door—the -Government maximum—in order to meet paclcers' wishes for a. larger return than Id per pound, now found to be too narrow a: margin to work upon. The fact that there is more butter in store together with that coming in than the local market can -absorb, is also given as a reason for the weakening of prica above mentioned. Speaking at the South Wand Dairy Association meeting. Mr. T. C. Brash, Secretary of the Dominion Buttsr Committee, charged the Government i with arbitrarily fixing Is 5d per pound for New Zealand, which, ho estimated, meant a loss of £700,000 to the butter market of the Dominion. That was a. large item, but jit was not the largest. The position was that the Government was paying. Is 4- 13-16 d for the butter, which was sold at Home for 253s per cwt. Had the New_ Zealand equivalent of that prica been paid to the producer he would have secured Is lOd per lb, so that accounted for a direct contribution to the Imperial Government of £1,100,000. It was entirely unjust that that sum should have been taken from the butter producers of this country.. At present tho price was being raised at Home continually, while it was being kept down hero. That irritated the producers, and he was surprised that there had not been a greater protest from- the New Zealand butter circles. They were told that the Imperial Government had to pay 400s for Danish butter. It might be wise to pay that price to keep the Danish, article from Germany, but that was a war loss, and should bo so treated. To ask the butter producers in Australia and New Zealand to bear the loss was unfair and un-Brit-ish. Mr. Brash concluded: —New Zealand and Commonwealth producers were asking for the colonial equivalent of th« wholesale price of their butter on,stho Homo market, and to that they were justly entitled. Cheese is being shipped away but slowly now by reason of scarce i tonnage. Production, however, is greatly The Acting Prime Minister of the Commonwealth has stated that enquiries for Australian butter had been received from America, but the refusa\ had boon given to tha Imperial Government, and he hoped a contract would be made. It was"' understood that the prico

at which tho offer was made was 180s per cwt. It has been learned by cablo that the distribution of the fifty per cent, of profits made by the Imperial Government on its butter deal with Australia will be at the rato of about £20 per ton to the producers, over and above, of courae, what they have already received.

ENGLISH CHEESE PRICES. — The following oto the nrajdmum control prices for British-made eh'eoso for from Ist May and let Tune onwards, accordt?;; ,43. make:—Oaerphilly, whole milk, Is 3d; Cuorphilly, partially skimmed, Is Oid; Caerphißy.swholly skimmed, lid. June Ist onwards—Ripened Stilton and .Wensleydiale, Is 7d; Dorset, hand-skimmed, blue, Is 2d; Dorset, white, lid;- all other whole milk cheese, Is 3£d.

HEMP.—There- is no material change in tho situation to report. Buying is virtually suspended for want of tonnage. Nominal prices are as follow:—Good fair £43 pot ton, higk fair £42, low. fair £40. Tow: No. 1 £7, No. 2 £6.

TEA.—The sale hold in Colombo this weok_ consisted of catalogues aggregating 2J million pounds of tea. The market at last cabled reports waa at lower prices all round. Tho Calcutta season reopens on Tuesday next with catalogues totalling' li millions. The quality and selection, of the teas to be offered are described as "uninteresting."