WHAKATANE PAPER MILLS

Greymouth Evening Star, 21 February 1940, Page 12

WHAKATANE PAPER MILLS

CROWN EVIDENCE.

[FEB PBESS ASSOCIATION.]

WELLINGTON, February 20.

Evidence for the Crown was begun to-day in the hearing by the Price Tribunal on the application by Whakatane Paper Mills, Ltd., to increase the prices of the cardboard it manufactures. Mr. Justice Hunter presided, with him Mr. H. L. Wise. Mr. H. P. Richmond and Mr. W. G. Clavis, of Auckland, appeared for the company, Dr. N. A. Foden for the Crown, and Mr. W. Perry for the users of Whakatane cardboard. John Bernard Prendergast, an officer of the Industries and Commerce Department, who carried out an investigation at the factory, said the information he desired went further than the books of the company provided. The company should have departmentalised costing from the start. This would have given it greater experience to work on in the present year. He did not see a plant inventory at the mill. This would have clarified the position. He felt that the tribunal would be faced with the question whether a number of entries referred to plant or to buildings. Witness said that 20 per cent, of the cost of Whakatane products was represented by transport costs. • This was abnormally high. If the company got the prices it wanted, the public would be paying these costs. The transport costs were high because of the site. Every pennyworth of raw material, including coal, had to be transported. In addition, the product had to be transported out. Mr. Richmond: Can you tell any place where the product would not have to be transported out? Witness said that at such a place as Auckland there would be less outward freight. The plant would be closer to the immediate market, and to the port for the delivery of imported materials. If a locality was chosen where there was coal only, pulp would have to be transported in.

Mr. Richmond: The mill uses 3,000,000 . gallons of water a day. That would not be got for nothing at Auckland. He asked the witness if he would suggest anything to the mill superintendent. The witness replied that there was only that he should keep a larger supply of timber on hand. Mr. Richmond: Would you suggest to a fisherman that he should keep a week’s supply of fish? Witness: 1 have not heard before that timber would keep only as long as fish.

Mr. Richmond: That is where you make a mistake. The analogy is closer than you think —a matter of three weeks. Mr. Wise asked what information the witness could give on the subject of the considerable export trade to Australia.

Witness said that he understood such possibility applied only for two classes of boards, and not to the whole range of products. The chairman suggested that after the adjournment the accountants on both sides should confer to see what could be agreed on about mill expenditure and the capital account of £586,000. The case could not be decided without something definite about this.

MATERIAL AND LABOUR. William Crabb Ward, a technical officer of the Government Timber Price Commission, and a production and marketing' 4 officer of the State Forest Service, said that his experience of insignis .pine extended from planting up to its utilisation for all purposes. .As to the statement t

for pulping purposes pinus insignis would not keep, he could best point to the 400 cords being kept for use ‘ as posts by the State Forest Service. Storing insignis pine should not pre- : sent any other difficulties than were I met with and provided against in the ' storage of great quantities of Scan--1 dinavian timber in any overseas mill he had ever heard of. From, his examination of the costing . ledger at Hie .mill this was .not one, in. his opinion, on which a costing system could be based. The labour cost, a cord was given at £l/2/6. He was prepared to concede to the company that the labour obtainable on Matakana Island could hardly be termed, fully efficient in the sense of timber cutting and loading, but at . the outside the cost a cord should, not be more than 17/-. With increasing efficiency this could be improved. At the present figure each man was producing a cord a day. There were any amount of instances in New Zealand at present where men were producing two cords of timber a day, cut into fourfeet lengths. ,

Witness said that the salary paid tat to the company’s chief engineer w£

considerably in excess of that paid by his department for a similar position —for instance, a chief mechanical engineer, with at least equal qualifications to control a. £lOO,OOO plant and a number of other plants, was recently appointed by his department at' £470 a year. Mr. H. A. Horrocks, New Zealand attorney for the company: Then he does not get as much as some of our carpenters.

The hearing will be continued tomorrow.