Commerce, Mining, Finance

Evening Star, Issue 22989, 21 June 1938, Page 6

Commerce, Mining, Finance

Dominion Breweries Profits New Tin Quota Fixed A sharp rise in New York yesterday accompanied by heavy turnover and a brighter base metals market contributed to an improved tone in the local investment market this morning. Buying support was still lacking for some issues, but leaders generally shared in the recovery. Business, although better, was restricted. The International Tin Committee has fixed the quotoa under the tin control agreement for the next quarter at 35 per cent, of standard tonnages. In the case of Malaya and the Dutch East Indies the quota has been augmented by 7£ per cent. The draft for the buffer pool scheme, in which there are no material variations from the original, was signed by all delegations in London yesterday. Dominion Breweries Ltd., reports a net profit of £41,257 for the year ended March 31, as against £22,039 in 1937. The gross profit is £50,533 up. 1

WORLD TRADE EXPANSION CHECKED A • • ’i DEMAND FOR METAL GOODS Up to February international trad© continued to expand, or at least to be maintained. Since October, however, the improvement on 1936-37 has grown smaller in ©very consecutive month. In February, for the first .time, world trade only equalled the corresponding figure of 1937, , . The following table is compiled from statistics collected by the ‘ Statist : PERCENTAGE SHARE IN WORLD EXPORTS.

The share of Australia in world exports since 1929 was greatest in 1936, but last year it dropped two points. Relatively it dropped niore than the fall in British exports, although that fall was three points. But the United States, Germany; and Belgium were still able to raise their shipments abroad, while France and Japan, which ship large quantities of textiles, abroad, fared badly. Contrary to the experience of Australia, Argentina gained three points in her percentage, though Canada lost one point compared with 1936. INFLUENCE OF ARMAMENTS. That the United States, Germany, and Belgium registered gains was due largely to greater exports of coal, iron and steel, base metals, machinery, motor cars, and other vehicles. In view of the fall in the prices of agricultural products, countries whose exports are mainly of land products will be unable to maintain last-year’s proportion of world trade, while the industrial countries, with their export of metallurgical and mechanical goods, are likely to gain. ' , ' This tendency more than any other factor is likely to influence future developments. To some extent it is connected with the_ momentum which armaments have gained as a factor in determining economic activity as a whole The suddenness with which defence preparations had to be made, the ‘ Statist ’ asserts, is one of the reasons which made -it difficult for British exporters to share in the benefits accruing from increased demand for metals and metal goods to the same extent as their competitors on the Continent and in America. These new requirements were put before industry so suddenly that only producers who had a big unused capacity at their disposal or were used to meeting export demands at short notice could take full advantage of them COST OF FOREIGN CURRENCY. As to the trend of international trade in the.future, two opposing factors may be cited. In large parts df Central and Eastern; Europe clearing and compensation arrangements have displaced freetrade, the totalitarian States have come to regard exports in the first place as a more or less expensive and not necessarily self-supporting means of obtaining foreign currency for which the respective Governments have assumed joint responsibility, and it seems likely that this tendency will make progress in Europe, and have repercussions in other continents as well. On the other hand, some of the countries interested in the maintenance of private enterprise and' the exchange of goods without regard to the immeditae effect on the currency position • have taken steps towards a more active trade policy. These conditions may result in a revolution in trade conditions similar to that experienced after the agreements of 1931.

BUILDING PERMITS DEGREASE FDR APRIL The value of building permits issued in the larger centres during April amounted, to £593,262 (states the ‘ Abstract of Statistics ’), a decrease of £236,502, or of 28.6 per cent., as compared with the total for March (£829,764). Included in the statistics of building permits are details of new buildings and major alterations and additions in the large centres commenced fay Government departments and education boards. The statistics for the month of April include 151 dwellings commenced by the Government Housing Construction Department and one alteration, the total value of these operations amounting to £151,329. The Government Housing Construction Department also commenced the construction of 38 new dwellings in other districts during the month. A considerable drop in the total number of permits issued for the erection of dwellings was recorded in April, the figures being 363 dwellings, vatued at £349,086, as compared with 547 dwellings, Valued at £-192,763, in March.

TIN QUOTA FIXED AT 35 PER CENT. BUFFER STOCK DRAFT APPROVED Press Ass?ciation—By Telegraph-Copyright LONDON, June 20. (Received June 21, at 11.5 a.m.) The International Tin Committee, which met in London, fixed the quota under the tin control agreement for the next quarter at 35 per cent, of standard tonnages, augmented in the case or Malaya and the Dutch East Indies by 7i per cent. The committee discussed and settled the revised draft of the buffer stock scheme, which, as finally agreed, was signed by all delegations present. There are'no material yanations as compared with the original draft. The committee fixed as the Contribution to the bufier stock for The next quarter a quota of 10 per cent, it standard tonnages are modified for Malaya and Dutch East Indies. The quota comes into operation on July 1.

The quota should be viewed favourably by the market in the meantime, but the long-term aspect depends entirely upon the demand. The market has regarded the proposal with favour, for last month, when it was doubtful if tho scheme would ever come into being, tin weakened until the price was only slightly above £153 a ton. This month, however, the market has become progressively stronger, the latest London price being more than £IBO a ton. The statistical position also has 'improved. World visible supplies declined by nearly 1,000 tons last month, after having increased by more than that amount during April. Consumption statistics indicate that the increase last year in invisible stocks was about 5,500 tons, and not nearly 10,000 tons, as had been assumed. For a long time the market has taken little notice of movements of stocks in official warehouses, believing rightly that uncontrolled stocks outside the restriction scheme represented an incalculable and potent bear factor. If the invisible have increased by little more than half the market anticipation, as the figures, prepared by the American Bureau of Metal Statistics suggest, the combined effect of restriction and a buffer pool should be felt earlier and to a greater degree than might have been expected. Meawhile the market must recover by about £2O a ton before it reaches the lower limit at which the buffer pool control will buy tin.

butter production AUSTRALIAN SYSTEM HEAVY COST TO CONSUMER Oa the Australian breakfast table butter was 3.1 d per lb dearer than export parity last year (writes Professor D. B. Copland, in tie ‘ Herald, Melbourne ). The domestic price was fixed at £7 per cwt (Is 3d per lb wholesale), while the butter output was . exported at a lower figure, averaging £5 11s per cwt, f.o.b. The difference represented a contribution of £2,565,000 by Australian consumers to the butter industry for the year (states Professor Copland). > The contribution in the previous year was £4,300,000. In June, 1937, the local price was raised a further Id a lb (to £7 9s 4d cwt). Now the price for exports has recently risen, some producers are agitating for another increase in the local price. Producer’s fix the domestic price, whereas protection of secondary industries is under the watchful eye of the Tariff Board. The object of the fixed Australian price for butter, which is determined by the Dairy Produce Equalisation Committee, is to give producers a better return over the whole of the output—domestio consumption and exports. This is, in. effect, a, form of protection to an important primary industry. In recent years the local price has sheltered producers from the low prices abroad, but the substantial gains to them represent costs to the Australian consumer. These gains form a very substantial part of the costs of protection in Australia, enter into the cost of living, into wages, and thus into costs of industry. PUBLIC TRUST OFFICE STATEMENT FOR MAY Estates of a value of £547,711 were accepted for administration by the Public Trustee during the month of May. The total value of the estates and funds under administration by the Public Trustee on March 31 was £60,815.300. Grants of administration made by the court in favour of the Public Trustee numbered 121 for the mouth. During the month 437 new wills appointing the Public Trustee executor were prepared on behalf of testators and lodged for safe custody.

NEW YORK SHARE INDEX DOW JONES AVERAGE

METALS GAIN GROUND TIN MARKED UP £3 STANDARD COPPER AT £3414/Press Association—By Telegraph—Copyright LONDON, June 20. (Received June 21, at 1 p.m.) Following are to-day’s official (middie) quotations on the London metal market, as reported by the Australian _ Mines and Metals Association, compared with those of June 17:— ' „ „„

PRICE OF GOLD Press Association— By Telegraph-Copyright , LONDON, June 20. (Received June 21, at 11 a.m.) Fine gold is quoted at £7 0s lOd.

Highest price in 1937, March 6, £7 2s 7sd; average price in 1930, £4 5s an oz. MINING NEWS REPORTS AND RETURNS MATAKI The Mataki return for the week ended June 19 was 28oz for 130 hours’ work and B,9ooyds dredged. GOLDFIELDS DREDGING The Goldfields Dredging Company advises a wash-up of lloz sdwb for 126 hours’ dredging. NEW RIVER The New River Dredging Company reports a return of 21oz of gold from 11,000yds treated in 126 hours during the week ended on Thursday last. WHITE’S ELECTRIC For the week ended on Thursday last White’s Electric Dredge treated 6,300 yards in 123 hours and recovered 290 z of gold. CHEAP MONEY PLACE OF SAVING

A point of view seldom emphasised regarding the cheap money policy so ardently pursued m official quarters was put forward by Sir Ernest Bemi, in presiding at the annual meeting of the United Kingdom Provident Institution. The cheaper money becomes the loss worthwhile is saving, he pointed out, and saving, in his view, is an allimportant national consideration. “Wo savers,” ho declared; “ have too long suffered the injustice of a one-sided market, a borrowers’ market, forced upon us by artificial means.” He was not speaking for the moneyowners or the capitalists, but for the thousands of hard-working people, tradesmen, clerks, civil servants, schoolmasters, and the like with policies and investments in the provident societies, the funds of which together constitute the bulk of all the money which is now so much managed. These people, and as a class they embraced practically the whole population, were ignored on their saving side by the advocates of cheap money. Money “ management ” necessary to enforce the eheap-moncy policy might, in Sir Ernest’s view, degenerate into a one-sided device to enable a Government to borrow cheaply. One of the most obvious effects of control was that industry was borrowing too little and Governments are borrowing too much.

COMPANY NEWS DOMINION BREWERIES HIGHER TURNOVER NET PROFIT ALMOST DOUBLED Dominion Breweries Ltd.’s gross [profits for the year ended March 31 are £148,192. Net profit, after providing for land and income tax (£34,505) and writing off £13,033 for appreciation, is £41,257. The balance brought m was £963. An interim dividend of 5 per cent, took £10,229, leaving £31,991. The directors recommend a dividend of 5 per cent. (£12,224), a transfer to general reserve of £15,000, and a carry forward of £4.767. . , The gross profit compares with £97,059 in 1937, while the net profit of £41,257 is against £22,039 last year.

FOODSTUFFS LTD. SATISFACTORY INCREASE IN TURNOVER Foodstuffs (Auckland) Limited directors have reported a very successful year. Turnover increased by nearly 24 per cent, over that of 1937, and the increase in membership was satisfactory in view of keen competition. Additions, out of net profits, had been made to all reserve funds, and paid-up capital showed an upward trend, the authorised capital issue.having been increased by 5.000 shares during the year to £20,000. An unchanged dividend of 7 per cent, on paid-up capital was approved, and a bonus to employees on wages was also approved, at a rate coinciding with capital earnings. The retiring directors were re-elected. KAURI TIMBER KILNS WORK AT FULL CAPACITY Erected at a cost of about £IO,OOO, the large battery of timber drying kilns of the Kauri Timber Company Limited, at South Melbourne, is working at capacity. The company’s modern battery of timber kilns is claimed to have the largest capacity in Australia. The first batch of four kilns and one reconditioning chamber was brought into operation in January last year, and on March 31, this year, a further five kilns were completed. The weekly output of the company is now between 100,000 and 125,000 superficial feet. To cope with the increased demand for its products, it may not be long before the company requires additional kilns.

Layout of the plan provides for ]8 dry kiln unite and two reconditioning chambers, together with the latest type of yard handling equipment, AUSTRALIAN STOCK EXCHANGES Press. Association—By 'Telegraph—Copyngtu SYDNEY, June 20. The Stock Exchange to-day showed no improvement, with sellers predominating. There is much comment here on the subject of the gradual falling of leading industrials, with no apparent reason. Brokers who were questioned to-day stated that the unsettled conditions overseas were upsetting the investing community. Some people, rightly or wrongly, feared a mild business recession. Other reasons were the droughty conditions in Australia and the smaller rvool clip. Most of the leading industrials, it is pointed out, have been too high, and are now coming back to their proper value, in addition to which dividends have been too high and cannot be maintained. Therefore it is not to be wondered at that there are more sellers than buyers in the market.

DOLLAR AND FRANC Press Association— By Telegraph—Copyright LONDON, June 20. (Received Juno 21, at 11 a.m.) The dollar is quoted at 4.97 3-16. The franc is quoted at 178,i.

: 1929. 1935. 1936. 1937. .United States 15.9 12.0 11.8 13.2 Great • Britain 10.9 11.1 10.7 10.4 Germany 9.9 9.2 ■9.4 9.6 Canada ■...: 3.6 3.8 4.6 4.5 France >.* 6.1 5.5 4.6 3.8 Japan 3.0 3.8' 3.8 3.6 Belgium ■,.< ■ 2.7 • 3.1 , 3.3 3.5 India :.*• >.* 3.6 3.1 3.3 3.0 Argentina 2.8 2.7 2.7 3.0 Netherlands 2.5 2.4 2.4 2.5 Australia ... 1.8 2.4 2.5 2.3

.Railroads. Industrials. Turnover. June 20 ... 20.70 118.61 1,090,000 June lb ... 19.73 113.23 iOO.OOU June 17 ... 19.68 113.06 330,000 June 16 ... 20.05 113.97 340.000 June 15 ... 20.23 113.24 340,000 June 14 ... 20.40 112.78 350,000 June 13 ... 20.16 111.87 530,000 June 10 ... 20.53 114.47 410,000 June 9 ... 20.81 115.74 590,000 June 8 ... 20.48 113.75 280,000 June 7 ... 20.55 113.12 370,000 June 6 ... 20.58 113.19 470,000 June 4 ... 20.57 111.82 310,000 June 3 ... 20.22 109.71 280,000 June 2 ... 20.52 110.68 480,000 June 1 ... 20.60 110.61 530,000 1938. Highest ... 32.33 134.35 Lowest ... 19.00 98.95 1937. Highest ... 64.86 194.40 Lowest ... 28.01 113.64

o UUC Jb* »■— Copper— Standard, spot Forward Electrolytic, spot Forward Wire bars . Juno 17. £ s. d. 35 18 1-k 34 3 l i 38 5 0 39 5 0 39 5 0 June 20. £ s. d. 34 14 4i 34 19 4-i 39 0 0 39 15 0 39 15 0 LeadSpot ... Forward - 13 18 li 13 18 li Spelter— Spot Forward 12 9 12 13 41 l| TinSpot Forward SilverFine, per oz ... Standard, per oz 178 12 6 179 7 6 18 3-4 d 20 l-4d 181 15 0 182 12 6 18 13-16d 20 5-16d

£ s. d. June 17 ... 7 0 10* June 16 ... ... 7 0 10 June 15 ... 7 u y June 14 ... • •• 7 0 8 June 13 ... ... 7 0 6* June 10 ... 7 0 7 June 9 ... ... 7 0 6-J June 8 ' ... ... 7 0 5; June 7 ... ... 7 0 7 June 4 ... 7 0 8 June 3 ... • •• 7 0 9 'June 1 ... • •• 7 0 74 May 2 6 19 64 April 1 ... ... 7 0 04 March 1 ... ... 6’19 94 'February 1 ... 6 19 7 January 3 ... ... 6 19 5

£ S. d. Bank of New South Wales 21 12 6 Commercial Banking of Sydney 20 13 0 Colonial Sugar 47 0 0 Adelaide Steam . ... 1 14 0 Howard Smith ... ... 0 19 6 British Tobacco 2 6 0 Tooth’s 2 13 6 Toohey’s 1 11 0 Coles ' ... 4 1 0 Australian Glass ...' ... 4 12 9 Dunlop Perdriau 0 19 74 (pref.) 1 17 9 Farmers 1 12 0 Horderns 0 16 9 David Jones ... 1 18 0 General Industries 0 17 3 (pref.) 1 4 6 Kandos ... 1 4 3 W. Adams ... ... 0 15 6 W. Atkins ... ... .;. ... 1 2 14 Woolworths 1 0 6 (rights) 0 3 5 Gordon and Gotch 2 10 0 Wilcox. Mofflin 0 6 0 Fairymead Sugar ... ... 1 13 0 Mount Morgan ... ... ... 0 8 8 Mount Lyell (ex div.) 1 3 0 Placer Development 3 15 6 Kuala Kampar 0 16 3 Rawang 0 8 2 Loloma 1 2 7 Taranaki Oil 0 12 0 MELBOURNE. June 20. The market is quiet. £ s. d. National Bank (£10 paid) 13 6 0 Varra Falls 1 17 5 British Tobacco 2 5 9 Coles 4 1 0 Australian Glass 4 12 6 Dunlop Perdriau 0 19 9 Mount Morgan 0 8 6 Mount Lyell 1 2 9 Broken Hill Proprietary ... 2 17 0 North Broken Hill 1 17 4 South Broken Hill 1 5 6 Emperor 0 12 5 Loloma 1 o 9