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BEEF TRUST OPERATIONS, Issue 15685, 26 December 1914
BEEF TRUST OPERATIONS
AUSTRALIAN INQUIRY. NO EVIDENCE OF COMBINES, BUT CAREFUL WATCH RECOMMENDED. The following is the full text of the conclusions reached bv the Royal Commisiioner (Mr Justice. Street) upon bis inquiry into the alleged operations of the " Americin Beef Trust" in Australia: 1. The American companies trading in the United Kingdom, which belong to_ tha croup popularly known as the " American Beef Trust," have been purchasers of Australian meat through distributing agencies abroad for somo considerable time. 2. Since tho removul of the import dutv on meat by tho United Statas Government last year these companies and others enin trade in the United States have made purchases through distributing agents in Australia and ei.-mv. here for shipment to ths United States. 3. All the foregoing purchase.-, have been made in the ordinary course of business, and there is nothing to indicate that they ■were not made under ordinary competitive conditions. —English and Americans.— 4. Three English companies, representing three, American firms most prominently identified in recent years with tho so-called Beef Trust, are extending their activities to Australia—a) the Swift Beef Company, of London, under the guiso ot •lie Australian Meat Export Company, a lompany registered in Queensland, have established works in th»i State, and have begun exporting; ;b) the Morris Beef Company, of London, have purcha-ed a site on the Brisbane River in Queensland, with a view to the establishment of meat works ; ici Armour and Co., of London, are purchasing frozen and canned meat through the agency of Birt and Co.. and otherwise they have also been in negotiation for the acquisition of an interest in the output of more than one meat works, and have purchased 5,000 cattle on tho hoof, which are being treated and shipped on their behalf by the Government Produce Department of South Australia. 5. There is no evidence of anything in tha shape of combination or concerted action on the part of the.-.c companies in Australia. 6. Rumors that these, companies, or some of them, have (a) purchased pastoral properties, (b) paid higher than ruling rates lor live stock, i'e) endeavored to purchase nnborn stock, and id) endeavored to securo option over young stock for future delivery at maturity are all without any foundation in fact. 7. The past history of tho so-called Beef Trust in other countries renders it necessary that the development of the activities at these three companies in Australia ihould be carefully followed, and I recommend that for this purpose the Government of the Commonwealth should communicate with the Governments of the several ■States and invite v their co-operation. —Matter of Imperial Concern.— 8. It is improbable that any one of these threo companies has any present intention of engaging in local trade in Australia. Their immediate object in coming hero is to increase their supplies of refrigerated meat for distribution in the course of their trade in tho United Kingdom and tho United States. At the present time they rontrol upwards or one-halt of the beef exported to tho United Kingdom and in South America, and if, in addition, they ..iquire control over a large part of the f>utput of frozen meat from Australia—a power which they are said to possess already—prices in the United Kingdom will ha very largely increased. If they combine for that purpose their organisation wild financial resources would probablv enable them to acquire control over a large proportion of the output from Australia. The matter is one of imperial and Argentine, as well as Australian, concern, and I recommend that the Governments of the Commonwealth endeavor to arrange with :he Imperial Government and with the Government of the Argentine Republic for the frequent interchange of communications and opinions in connection with future developments with tho view to concerted action, if necessary and practicable, in the_ event of any detrimental combination of forces being reported. 9. As there is no evidence at present of anything in tho nature of uu attempted restraint or monopoly in connection with trade from Australiaon the part of these companies mentioned, it dot-, rot -ippiM'to me that any further action of a special character is necessary at present over and above any legislation which it may be proposed to introduce for the purpose of dealing generally with detrimental monopolies or combinations. —Position of Various Firms.— 10. The Cudaby Packing Company have made purchases in Australia for their business in the United States, and contemplate appointing Messrs Robert Little and Co. as their agents in Australia. This is the full extent of their activities in Australia, and in all their transactions they have acted independently of other firms." 11. The ownership in common of tho Riverina Meat Work' by Angliss and Co., Borthwick and Sons, and John Cooke and Co., though in effect it removes two competitors from the area from which supplies are drawn, does not injuriously affect prices or operate in any way to the prejudice ofproducer or consumer. 13. The agreement between the Queensland Meat Export and Agency Company and five other companies, hv "which "that company tender for the supply of froaen meat to the L'nited States urniv in tho Philippine Islands, and the others sharo in providing Unnecessary supplies under contract, is, by its elimination of the element ff competition, «u agreement in restraint ' ot trade. Ido not know whether the effect is to increase the price to the United State* Government, nor do I know whether that Government are aware of the practice that is adopted. I apprehend that thev are not. 13. Although the operations of the Sydney Meat reserving Company at times may have affected the export trade in mutton to some extent. th« interference has not been sufficiently serious to call for »ny special action on the pa-t of tha'Commonwealtii Novt.riiment over and ahovp any action that may bo contemplated bv the Government of > ew South Wales. 14. It has not been shown that th'ero U fit the present timo nnv agreement among the exporting firms for the purpose of sup', pressing competition or fixing or regulating prices. The practice occasionally adopted by buyers in the markets of taking alternate pens, or of dividing pens, is one which probably exists in all stock markets,and does not indicate a combination ■ftn toe part ot their principals.
BEEF TRUST OPERATIONS, Issue 15685, 26 December 1914
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