PRODUCED MARKET REPORTS FROM DAY TO DAY

Evening Post, Issue 36, 12 February 1935, Page 12

PRODUCED MARKET REPORTS FROM DAY TO DAY

GENERALLY IMPROVED

SOUTH AMERICAN TRADE

EXCHANGE INTRICACIES

, _ '(Evening Post," February 12. New Zealand can no. more afford to bo indifferent to the course of economic events in South America—in large part—than the shopkeeper on one side' of the street can ignore what his competitor on tho other is doing. As was mentioned in a cablegram from London yesterday, the "Yorkfn lw O^ oSt'iii? °*<™b that decreases' m wool cold in New Zealand and South Africa wjll not affect the market very much, being offset by increases in Australia and Uruguay. South America is a large and diversified-territory, and is engaged m various branches of husbandry which come into competition in British and other markets with New Zealand primary products-meat, wool, and (to a declining extent) dairy produce. Chile has for years endeavoured to build up a hard ■ W "s?* tr- ade and Placed apples in +£r<= CO?, dlti[ on ln tne British markets. Of the South American chilled beef it is unnecessary to-do more than mention Ausol the Bank of London and South America, on the course of trade in the various countries of South America should interest &% f f3I N r gZe ta hi ean Pd t. imary °W 3% F?i Ster r,rec,entl y inf°rmed siiareholdf»? tb° ? a? k of London and South America that in Argentina the improvement m conditions that began a year ago has developed into an all-round recovery 1L nT c r e> industry, and production. Ihe banking and currency positions have not altered to any great extent, nnancial soundness prevails, and full compliance has been given to all national obligations, both internal and external. Compared with 1933 international trade has ihown expansion both in volume and value, the figures for the total movement of the first ten, months of 1934 being 2,113,000,000 . pesps, an increase of 450,000,000 jiesos. Local' industrialism, which developed, when the import of various easily-manufactured articles was costly, is now flourishing, and the country is less dependent on others for essentials. "In Uruguay there has been improvement "in :internal' conditions during the past year; 'As regards prospects, cattle are healthy, crops' are favourably reported on, and wool is expected to show an increase of 15' per cent, over last season's clip, while the quality is reported to be excellent. WAR AND NATIONALISATION. "For over two years the war with Bolivia has overshadowed the social and economic life of Paraguay, various offers of mediation having been unsuccessful. Irospects for the future are obscure, but with an early termination of the war-the recovery of the country should not be slow or difficult." Referring specifically to Brazil, Mr. Foster eaid that politically and economically it had progressed during the year, the outstanding event being a return to constitutional .government. Under, the new Constitution all mines and waterpower, are to be nationalised, as also all insurance companies. Public utility companies, national and foreign^ are now obliged to form their local administrations with a majority of Brazilian representatives. Progressive nationalisation o! deposit banks ia also provided for, but in what form remains to be seen. The coffee situation has benefitedby the destruction of surplus production and by the prospect of a short cropj-.which,-owing to weather conditions, is only estimated at 14,000,000 bags, or less than half the harvest of last year. There has also been a large increase in the shipments of raw cotton. Chile has tried hard to straighten out her economic situation and has been helped by good prices for her wool and' agricultural produce and also by an increase in nitrate and copper shipments. ■ "EVERYTHING NEBULOUS." Referring specifically to the exchange position, Mr. Foster said: "Everything;in the.exchange market is nebulous—sterling, the dollars of America, Argentina, Uruguay, Chile, and Colombia, and the mil-reis-of Brazil, all acting on each othbr, but not necessarily-in relation, all .manipulated, perhaps necessarily, by their Governments, and not one showing the true picture-of the country's balance of trade." Mr. Foster added that this being so the board_ of the bank had followed its usual practice of converting at official rates, thus making comparisons easier between the accounts of 1933 and 1934. ; "Taking the conversion at official rates, the .nominal loss on capital is £913,000, but at free rates it would be larger; Such loss, however, would only be'(realised should we cease to function as -avbank,' but the remittance of currency profits is another story, for'when these are remitted at the free rate and the accounts'closed at the official rate there is a definite loss." HOW LONG? The Financial Editor of the "Daily Telegraph," in commenting on' Mr. Foster's . speech, asks:— . -..-■■■: : , "How long will it last? The kindly reference to 'manipulation' covers a number of acts by the Governments of these countries, which, in my- opinion, are open to grave criticism. But before Great Britain and the United States can protest effectively'they must set their own exchange houses-in order. ■ .■:■■ "There' is, I find, a growing fear-that British undertakings in these and: ; other countries will be. 'frozen out' altogether, unless some way can be found of improving, exchange conditions." DOLLAR RATES. The . following dollar-sterling rates' were quoted on February 11 by the National Bank of New Zealand, Ltd. They are subject to alteration without notice:— U.S.A. Canada. I Dols. Dols. Conversion of dollar bills received for collection and sale of dollar drafts and telegraphic transfers 4.85 4.86 Purchase of dollar bills 4.89 4.90 Ona New Zealand currency basis these vates are equivalent to the following:— U.S.A. Canada. Dols. Dols. Selling: T.T. 3.89% 3.90% On demand .... 3.89% 3.90% Buying: On demand .... 3.96% 3.97