LOSSES ON SHIPPING

Evening Post, Volume CXI, Issue 120, 23 May 1931, Page 16

LOSSES ON SHIPPING

LINERS IN BALLAST

MAINTAIN EXPORT TRADE

"Evening Tost," 23rd Hay. Some Great British shipping companies iave been far too much in the "news" of late to the liking of their own shM.eholders. Sir Percy Bates, chairman of the Cunard Co., for instance, recently told shareholders how, as he saw it, fear .■was the cause of the present trade depression, and under its influence there was a "slow paralysis o£ international trade, with corresponding evils for shipping." The Cunard Company passed its dividend this year. Freight and passenger traffic for the year showed serious reductions in volume; gross profits were less by nearly £1,000,000 than last year, and nearly £900,000 was taken from reserves . (or savings) in order to meet the depreciation of the book value of shares in subsidiary and other companies. The Cunard Company was not the only shipping company caught in the economic hurricane. There were others, and some of them fared very much worse, for their bulkheads, figuratively speaking, were severely tested, and in some instances their watertight compartments let in water. Australia and New Zealand have their own .trades which, no less than those of the . Western Ocean, Mediterranean, and the. East, have experienced heavy weather during the past twelve months. But-.these countries arc in circumstances somewhat different from Canada and the United States, and India, Chi'iia, and Japan, or even Africa, with its exports of gold and diamonds, ivory, peacocks, and apes. If the produce oC Australia a ml. New Zealand in not carried with ■ unfailing regularity half round the world to the United Kingdom, there is relatively little of it that will find a market elsewhere. But carrying- cargo Home is riot, all that shipping managements have to study. The facilities and the freight rates for such cargoes to a large extent are determined by ability to fill a ship's holds with cargo outwards, as well as to load lip with cargoes homewards. The nature of the latter cargoes, too, has to be taken into account and provided for. Wool, meat, ttairy produce, wheat, and other produce are seasonal, and cannot bo loaded at any time and discharged just when the ship might arrive. SHIPS MUST BE THERE. Ships must be available to take Australian and New Zealand cargo in general ■when it is ready, and in the. particular season and, what is equally important, to work to timetable, with an exactitude almost equal to that pursued by a great railway system. The ships must arrive punctually at their trading ports to lift the produce, although it does not necessarily follow that the produce in sufficient quantities is there ready to be lifted.1 It may be delayed in reaching port, it may be withheld because of some unfavourable turn in the market, or it may be rushed flown in greater volume than the cargo space provided for it can take; or, in the matter of insulated cargo, there may be more of one sort of produce than another for which special holds have been prepared, and for which specific •temperatures have to bo maintained. But the ships will be there. Some interesting figures showing the heavy decline in Australian imports were recently prepared by the Melbourne agents of an overseas shipping line trading between Australia and the United Kingdom. The average cargo capacity of the vessels mentioned is SOOO tons. These vessels are leaving Australian ports for Europe laden with Australian products; but the ship owners claim that even with the heavy outward cargoes the high operative costs and the losses of exchange on frozen cargo make their present profits on the trade negligible. It is estimated that a passenger and cargo vessel of the type and capacity mentioned would take !£SOO a day to run. According to statistics compiled by this company, a vessel which arrived from the United Kingdom during March and April in 1928 brought 1865 tons of merchandise for this port, and 6211 tons for all Australian ports. The corresponding vessel in 1931 brought 623 tons for Melbourne .and 2147 for all ports. Another vessel at a similar period in 102S brought 3165 tons for Melbourne and 7743 tons for all ports. The corresponding figures for the same vessel this year were 6SO tons for Melbourne and 2003 for all ports. DOMINION'S FACILITIES. What of New Zealand? This Dominion is served as to the United Kingdom by four shipping lines, which are in th^e first rank of British mercantile tonnage—the Shaw SaviH, New Zealand Shipping, federal, and Commonwealth and Dominion lines. They, too, are evidently feeling the effects of falling off of outward cargoes, attributable to drastic curtailment of imports, the result of reduced public purchasing power, high duties, and high exchange. The export'cargo is here to be lifted, it must be, and it is, lifted by scheduled dates. Tonnage must be provided by the shipping companies for this purpose, and is being provided. The service is being rendered. But at what cost to the companies? Ships are now coming out to New Zealand with practically half cargoes as compared with 1929. In addition to this, during the present season eleven vessels have come out in ballast, and four ships have brought out part cargoes of basic slag, which, owing to its low rate of freight. and the high cost of loading and discharging, are tantamount to ballast voyages. ' • . Tha reduction in imports has necessitated bringing out-a considerable number of steamers in ballast,.as above stated, to carry the refrigerated produce of New Zealand to its overseas markets.

Nor is that all. Due to the reduced market values in the United Kingdom and on the Continent for wool, pelts, hemp, tallow, and other produce regularly exported from New Zealand, cargoes Homeward have been considerably reduced in quantities. Many vessels, it is reported, having sailed with their general cargo space only' partially filled. And finally there is tbc serious problem of exchange. At present the rate_ is 10 per cent., and this means that in remitting to London their earnings on freights paid ..in New Zealand,; .the companies lose 10 per cent, through exchange, or £100 in every £1000 remitted. As a very large proportion of the cargo consists' of meat, butter, and cheese, also fruit, the freights on which are paid in New Zealand, there is a loss of 10 per cent, on all these freight earnings by the time the money is made available in London.

But for all these handicaps, the ships are nere, up to time in their arrival, up to time in reaching their ports of discharge. Accepting the Australian figure of £500 a day as the working costs of running a big modern vessel—and for some of those coming to New Zealand it seems moderate—the loss of ciiniing power and the cost of running out eleven empty ships at £400 or £500 a day. for, say, 35 or 38 days on the trip to. New Zealand, must make a large hole in shipping companies' profits this year. But the fact rcuiaius that the ships are here, when and wherever they are wanted, and that they deliver their cargoes to time. This orderly and wonderful, service of transport is carried on year in, year but, smoothly, and with, no fuss. . . .