TRADE ITEMS

Evening Star, Issue 17720, 22 July 1921, Page 8

TRADE ITEMS

It is estimated that six and a-lhalf million bushels o! wheat have been threshed, this being practically all taken , up by millers. It is open to doubt whether thcro is another hall-million f bushels to come. Available supplies of wheat and flour should suffice till next harvest. Thcro lias been a heavy sowing of wheat for next season, and with normal weather conditions tho 1922 yield should more than equal New Zealand , requirements. There is an active local demand _ for agricultural seeds of all descriptions. Farmers are evidently preparing to sow down extensive areas in grass, and they will bo able to do so at''largely-reduced cost compared with recent years, Probably the cost per acre will amount to 255. as compared with £2 10s last year. Tho drought in Webern Europe is an additional incentive to grassing operations here. Mr Dalton. British Trade. Commissioner

for Now Zealand, reporting on the dairying industry, says that it is estimated that onr milking herds now comprise about BOO.GCO cows: but they are low

producers of butler fat, the average per cow per year being 1641 b, instead of a possible 2Goib or oOOlb. The carrying capacity of dairying land works out at from two to three acres per cow, whereas by extra cultivation ami cropping Si should average a cow to one and a-half acres.

It mar have been noticed that tho latest report by .Messrs .Joseph Nathan and Co. confirms the impression that the.

North Island is holding considerable stocks of butt or. In view of the price ■which, tho local consumer is paying, and in view also of the fact that the producer is subsidised by tho taxpayer, the advice contained in tho fellow in;.; extract from this firm’s report is interesting and worth preserving. It reads: —“ Thcro appears to bo a large quantity of buiterlln store and likely to bo made between now and August 31, over and above the Dominion’s requirements for local consumption. Dairv factories would be well advised under that circumstance to follow the example of America ami Germany under like conditions—that is, to export their surplus of any manufactured article they may hold, and thus avoid breaking tho local market. These countries always do this regardless of the pries they_ receive for their export surplus. In this instance tho spot market in London looks encouraging.” A recent number of the ‘Economist’ contains tho following among its list of fresh capital issues Joseph Nathan and Go., Limited—Authorised share capital £1,050.000, divided into 250,CC0 £1 “A” 7 per cent, cumulative preference shares, all of which have been issued; 4C0.0C0 8 per cent, cumulative participating preferred ordinary £1 shares, of which ICO,CCO have been issued and 300,000 are now offered for public subscription at par: and 400,000 £1 ordinary shares, of which 118,230 have been issued. After tho claims of tho 7 per cent, preference shares have been satisfied, these participating preferred shares are entitled to a cumulative dividend of 8 per cent., and will rank for further dividend pari passu with the ordinary shares after they also shall have received 8 per cent, until both classes of shares receive 12 per cent., which is the maximum dividend for these participating preferred shares. The present company of Joseph Nathan and Co., Limited, was formed in 1899, to acquire the business of colonial merchants and produce brokers carried on in London, and in Wellington, New- Zealand, and elsewhere, by the firm of Joseph Nathan and Go. Mr J. E. Nathan, tho founder of tho present business, commenced trading in Wellington. New Zealand, in 1857, and in 1874 established the firm of Joseph Nathan and Co, The London office was opened in J 1875. In ISOS tho company placed on tho market a standardised milk for infants and invalids under tho name of “ Glaxo,” which as well known. Profits, however, are only submitted from 1916. although these are on a very substantial scale. Net assets are valued at £543,214; but the date which this statement refers to is September 30, 1920. A favorable feature is that no value has been placed on goodwill, although expenditure on advertising must have been considerable during tho last few years. However, it is curious to look back and note how fickle popular fashion is with regard to patent foodstuffs. Of course, this may be tho one food for tho gods which has come to stay, but the future alone will decide that. This is a fair industrial risk, and tho issue has been over-subscribed.”

Bond and debenture issues bare been ft prominent feature of British and American, as well as of Non' Zealand finance. Scarcity of cash, says an American commentator, is ono of the things which perhaps more than anything else w retarding our business . recovery to-day. Some people call it reluctance to" buy, but it is all the same. Capital in the' form of cash or credit is absolutely necessary if business is to bo done on any largo scale. The nations of Europe know this, and lack of capital has been the principal reason why their recovery from the effects of the war has not boon more rapid. War destroys capital, of course, and it takes time for the pursuits of peace to replace that which is gone. Lack of capital in Europe has injured ns too. We must do business with all the world if we are to keep our industries employed, and when a large portion of the world cannot buy from us because of lack of funds our business cannot help l:mt feel the effects. If we leal; upon the United States as a business enterpiise with fifty pood customers, and if tho fifteen best customers

suddenly stop buying, we can understand tho results. If we appreciate that they have stopped buying because they have no money, wo can understand how joyfully we "shall welcome indications of an improvement in their financial standing which will bring them back to us as buyers once more. During the past year or "two corporations and Governments borrowing money have had to pay -xtrenicly high interest rates to the people who have loaned it to them. The lender has naturally benefited, and the fact that money has been worth more than is normally the ease has reacted to his advantage. A year ago high-grade domestic issues carried cent, coupons, while at the present time new issues or this class hear coupons paying 61, per cent, and 6 per cent. Tho trend of interest rates is plainly downward. There is another phase of tho matter which is also worth considering. Many of the corporations which were obliged to do financing when interest rates were highest figured that tho conditions obtaining at that time were only temporary. In order to protect themselves thev had incorporated in the indentures securing their bomb a provision that on due notice the bonds might be called for redemption and paid off. They planned to retire their outstanding bonds and issue new bonds at lower rates should interest rates tall. Not all of tho highviekl issues on tho market to-day contain this redemption feature. If you investigate before you buy and select only those bonds which cannot bo called, you can assure voursclf of the high yield over a long period of years, and snap your fingers at the downward trend in interest rates. Non-callable bonds yielding these high returns mar bo purchased which do not mature for fifteen or twenty years. It is the part of wisdom for investors to give this kind of bonds their careful consideration. This point as to whether the bonds can be retired before the date of maturity lias perhaps not been given enough consideration by subscribers to New Zealand issues. . An unusual event in local business circles was fhis week’s sale of opossum skins. Of over ‘9,000 Meins offered, tho great hulk came fromWie Gatlins district, and represented the outcome of lifting tho close season for one month. It is stated that one settler’s proceeds for this brief time amounted to El4O. Shippers of hides arc not operating, and the market remains quiet.