Commerce, Mining, Finance

Evening Star, Issue 22953, 10 May 1938, Page 6

Commerce, Mining, Finance

INDUSTRIAL BRITAIN DEFINITE RECESSION IN TRADE "SO FAR VERY MODERATE " There is now no doubt that Great Britain is experiencing a definite recession in trade and employment. The week-end London commercial summary, ■ published yesterday, reports that industrial news “ is increasingly disturbing.” Rail traffic receipts :are becoming steadily poorer, coal exports are the lowest'for a year, and the cotton trade is sc idle that orders 'are fast becoming recognised as good industrial indicators. Budget commentators Wrote that the Budget “ clearly shows that the Treasury, admits a res cession.” .-■■■'* Llbyds Bank Ltd., in its March review; presents 1 .-its 'view of - British - industry for the first two months, of the year. Some indication is given by the ‘ Economist’s ’ business activity index number for January, which has registered a drop below December of only half - a point, from 111 to 110.5. The total drop in this index, since it touched its peak in the early autumn, is from 113.5 to 110.6, soHnat both this year and also since the autumn peak the recession has been • very moderate. It also looks as if most of this year’s recession has been seasonal, and February indications tend to confirm this view. , . . ? “ SEVERAL POINTS OF ANXIETY.” - . 4 There, are, however, seterab points of anxiety,, adds the. bant.-. First and foremost the heavy industries, which so far have maintained their activity, are beginning to report the need for new orders. Civilian business •is now falling away, which means that these industries are becoming more dependent upon rearmament orders. The current position of" the textile trades is even less encouraging. 1 Short time is already being worked in' both the cotton and woollen industries. Also last year’s sharp fall in the prices of primary products must be affecting the purchasing power of many of our export markets. Among other significant signs are this year’s fresh, though limited, fall in wholesale prices, and the fact that,electric power consumption and the demand for industrial chemicals are not quite 'up to the level,of previous months. That is the discouraging side of the present picture, but there are also several hopeful signs. In the first place the January increase in unemployment was less than the normal seasonal increase. Again activity in the building industry is well maintained, and plans for dwelling houses passed in January were above the volume of the previous year. The January decline in iron and steel production was partly seasonal, for a similar contraction occurred a year ago. Railway goods traffic receipts are up to their early 1937 level, when 'allowance is made for last October’s increase. Retail trade for January was 6.2 per cent, above that of January, 1937. Taking the position as a whole, so far the recession has been very moderate. There is, however, a growing need for new orders in many sections of industry.

SYNTHETIC WOOL NEW INDUSTRY FOR POLAND A Polish factory is being established to produce synthetic wool from casein. The company was formed last year as the result of a convention between Snia Viscosa Ltd., of Milan, and a group of Polish manufacturers. It plans to produce 3,000 kilos (6,6001 b) a day in the initial stages, and to increase production later to 8,000 kilos a day. The Polish production of Lanital may thus diminish the country’s imports of natural wool, and, as the * Manchester Guardian Commercial ’ points out, provide an alternative service of supply in a country much hampered by trade restrictions. Last year Poland imported about 21,000 tons of raw wool. The country has been a useful minor customer of Australia, taking at times more than 20,0CX) bales a year from the Sydney market. The Polish domestic production of wool is only 3,600 tons' a year, and most of it is consumed by the peasants who grow it. Poland produces about 9,000,000,000 litres of milk a year. One kilo of textile casein is needed to_ make one kilo of Lanital, and it requires 33 litres of milk to produce one kilo of textile casein. Thus, to produce 8,000 kilos of Lanital a day would require about 96.000.000 litres of milk a year, or not much more than 1 per cent, of the normal output. SHARE QUOTATIONS Pres* Association—By Telegraph—Copyright LONDON, May 9. (Received May 10, at 11 a.m.) Share quotations: Gluthn River—buyers Is 7id, sellei- Is l n Ul; Molyneus River—buyers 10id, sellers Is lid. V

British Trade Recession London Quiet, New York Up Despite the optimism expressed by leading industrialists,, the trade recession in Great Britain is apparently becoming more pronounced. Authorities agree, however, that so far it is very moderate, but the fact that it has been generally recognised gives some cause for concern. Latest London cablegrams confirm the view that the recession is not solely due to seasonal influences. Although Continental currency problems are restricting business on the London Stock Exchange, New York recorded another marked improvement yesterday on a heavy turnover. Influenced by the brighter trend in Wall Street, the local market opened steadier to-day, with slight gains recorded in ■ some leading Australian issues. Business was restricted, however. The National Eeliance Investment Trust (Melbourne) has declared an unchanged dividend of 6 per cent, on the old' shares and pro rata on new-shares.

EXPORT VALUES IMPROVE RECENT DECLINE ARRESTED ~ AUSTRALIAN PRICE INDEX A halt in the decline in Australian export prices is indicated in the latest index figures issued by the Commonwealth Bank of Australia. In each of the first three weeks in April the index rose a fraction, and in the last week it had almost reached the March average. Since then butter, which had been of great assistance, has moved to still higher levels. The index stood at 74.5 at April 21, compared with 73;7 at April 14 and 73.2 at April 7. The average for March was 74.6, that for February 75.4, and that for January 77.1. The corresponding figures: in 1937’were .March, 100.1,, and February, 94.9. The base is 100 for 1927. ; ‘ The rise between A’pril 14 and April 21 was due to increases in the prices of wheat, butter, sugar, and lamb. Base metals and gold sold at slightly lower prices. Early last year the index rose above the 1927 level. The boom in commodities, which followed the announment of Britain’s armament programme, reached its peak in April; The average of the index for that month was 101.9. It had declined steadily since then, except for a Brief spurt last June, until the be-’ ginning of April. All commodities except beef and lamb had; fallen, the reductions in price being severb in- base metals; wool;rond wheat. / LEMON CURING FACTORY GISBORNE CO-OPERATIVE PROJECT A proposal to establish a co-operative lemon curing factory in Gisborne is to be discussed by growers of the district. A committee consisting of prominent growers has had under consideration for some • time the idea of forming a cooperative citrus society to erect an up-to-date curing factory, and the committee is of opinion that the time has arrived when some definite action should be taken. Factories of this nature already are operating in all the other principal citrus-growing areas in New Zealand. It has been proved that it is uneconomic to market uncured lemons, and the Government is discouraging this practice. T The curing and grading of lemons is a specialised work requiring buildings specially constructed, and growers realise that the expense of such buildings is too great for the individual grower. Also, the introduction of the fruit-grading regulations of 1938 makes the grading, of all lemons compulsory, according to set standards, before being offered for sale.: Grading also is not a simple matter, and can be done satisfactorily only by trained graders. - _ Under those conditions, therefore, the committee feels that the establishment of a co-operatively run factory appears to be the only satisfactory way of meeting the present situation. REPORTS AND RETURNS WHITE’S ELECTRIC During the week ended on Thursday last White’s, Electric .dredge worked 126 hours and recovered’ 31oz of gold. ADDISON FLAT For the fortnight ended May 3, the Addison Flat return is 270 z for 30 shifts. HEW RIVER DREDGE A total of 340 z of gold was recovered by the New (River Company’s dredge during the week ended on Thursday last, when 10,000yds were treated in 122 hours. MATAKI DREDGE The Mataki return for the week ended May 8 was 330 z for 122 hours’ work and B,sooyds. ITALIAN BANK DIVIDENDS The resumption of dividends is announced by two leading Italian banks —namely, the Banca Commerciale Italiana and the Credito Italiano. Both propose to pay 4 per cent. Previously no dividends had been paid by these two banks since the distribution by each of 5 per cent, for 1933, the profits earned in the interval having been utilised in strengthening reserves, ,

NEW YORK SHARE INDEX DOW JONES AVERAGES

LONDON STOCK MARKETS BUSINESS RESTRICTED UN EXCHANGE Press Association—By Telegraph—Copyright LONDON. May 9; (Received May 10, at 11 a;m.) > Continental currency problems are restricting business on the Stock Exchange. The new Australian scrip recovered 3-16 to 9-16 discount. COMPANY NEWS NATIONAL RELIANCE TRUST UNCHANGED DIVIDEND RECOMMENDED DISTRIBUTION OF 6 PER CENT. [Per United Press Association.] WELLINGTON, May lOi The Stock Exchange Association ■ haa 'received the following cable:—The directors 'of the National Reliance Investment Trust have _ recommended, subject, to audit, a dividend of 6 per cent, on old shares, and pro rata on new shares. The dividends are payable on June 6. The dividend is at an unchanged rate. AUSTRALIAN STUCK EXCHANGES Press Association —By Telegraph—Copyright SYDNEY, May 9. Several leading industrials gained strength on the Stock Exchange to-day. Tooth’s shares were at the best point of the year. There was also good demand for shipping shares Base metal issues, however, were quiet. MORNING SALES. '

PRICE OF GOLD LONDON, May 9 (Received May 10. at 11 a.in.) Fine gold is quoted at £6 19s lOd.

Eailroads. Industrials Turnover May 9 ‘ ... 23.50 119.43 1,020,000 May 7 ... 22.64 117.21 560,000 May 6 ... 22.90 117.16 1,020,000 May 5 ... 21.57 113.46 690,000 May 4 ... 21.51' 113.88 550,000 May 3 ... 21.45 . 112.70 470,000 May 2 ... 20.95 110.09 350,000 Apl. 28 ... 21.21 111.98 540,000 Apl. 27. ... 27.73 115.25 420,000 Apl. 26 ... 21.83 113.94 440,000 Apl. 25 ... 22.09 116.23 400,000 Apl. 21 ... 21.33 115.40 600,000 Apl. 20 ... 21.26 114.90 780,000 Apl. 12 ... . 22.40 113.88 600,000 Apl. 11 ... 23.48 112.93 1,000,000 Apl. 9 ... 22.75 115.32 1,410,000 Apl. 8 ... 21.7 109.57 830,000 Apl. 7 ... ,20.80 105.43 330,000 Apl. 6 ... 20.80 106,29 480,000 Apl. 5 ... 21.45 108.36 690,000 Apl. 4 ... 21.24 105.58 690,000 Apl. 2 ... 20.46 106.11 600,000 Apl. 1 .... 19.81 103.02 860,000 1938. Highest ... 3233 134.35 Lowest ... 19.00 98.95 1937 Highest ... 64.86 194.40 I Lowest ... 28.01 113.64

£. s. d. Commonwealth Bonds— 4 p.c., 1941 102 17 6 4p.c., 1947 102 17 6 4 p.c., 1950 103 10 0 4 p.c., 1957 Bank or New South Wales 105 8 9 32 10 0 Tooth’s _ 2 17 6 Australian Iron and Steel Colonial Sugar 1 7 49 17 9 6 Kandos ... 1 5 3 AFTERNOON SALES. Bank of New South Wales 32 12 6 Comm. Bank of Sydney ... 21 1 0 Queensland National Bank 5 3 0 Union Bank 9 0 0 Colonial Sugar ... ... ... 50 0 0 Burns, Philp 2 13 6 Burns, Philp (South Sea; N.Z. delivery) 1 7 6 Berlei 2 1 0 Tooth’s ... 2 18 0 British Tobacco 1 11 0 G. J. Coles ... ; 4 1 6 Australian’ Glass 4 15 0 Dunlop Perdriau ... ... Farmer’s 1 2 6 1 12 6 David Jones ... 2 1 0 General Industries ' 0 19 4i Stedman’s 0 15 6 Felt and Textiles 1 13 3 Mauri Bros 3 8 9 Goldsbrongh, Mort 1 10 9 Wilcox, Mofflin ... 0 8 8 Henry J ones 2 9 9 Traders’ Finance 1 0 104 Standard Cement 1 0 0 Mount Morgan 0 9 0 Mount Lyell • 1 7 U South Broken Hill 1 10 lOi Rawang 0 8 10 Tonkah Harbour 0 10 n Taranaki Oil 0 8 0 MELBOURNE, May 9. The market is generally steady. but quiet. £ s. d. Comm. Bank of Australia 0 16 7 National Bank (£5 paid) 7 10 6 Bank of Australasia 10 0 0 Australian Paper Manufacturers (pref.) 1 3 6 6. J. Coles 4 1 0 Aust. Iron and Steel (pref.) 1 7 9 Dunlop Perdriau 1 2 8 Cox Bros 0 16 0 ‘ Herald and Weekly Times ’ 2 19 6 Aust. Foundation Investment Trust 0 4 5 Mount Lyell ; ... 1 7 0 Broken Hill Proprietary 3 1 9 Broken Hill Proprietary (new issue) 1 17 6 Loloma 1 2 44