EFFECT ON FARM MACHINERY FROM AMERICA

Greymouth Evening Star, 21 September 1949, Page 8

EFFECT ON FARM MACHINERY FROM AMERICA

WELLINGTON, September 20 (P.A.) —The immediate reaction of a large section of farmers to news, of the devaluation was one of dismay at the thought that American-made farm machinery might be out of reach; Many telephone calls from all parts of New Zealand were received in Wellington yesterday and today by leaders of the farming industry ’ and by importers of machinery. . i There are compensating .factors, and, as far as farm machinery was concerned, New Zealand will be no worse off than in July, 1948, before New Zealand currency was brought, to parity with sterling. There had, been recently a reduction amounting to about 10 per cent, in production costs in the United States 'and Canadian factories. The reduction has not yet been reflected in selling prices in New Zealand, but will help to compensate for the increase caused by devaluation. New Zealand will now lose the benefit on imports gained through the alteration of the exchange rate last year. During the last 12 months not a great deal of farm machinery has been obtained from America, so that farmers expecting delivery of equipment in the early part of 1950 can expect to pay about the same price as they would have in July of last year. * Another compensating factor is the increase of 7i per cent, in the new contracts with Britain. Even if a farmer does not produce another extra pound of butterfat above last year’s production his income will be better. The need for American-made farm equipment still exists, and a great deal of New Zealand's requirements must still come from the United States, which produces equipment that cannot be obtained elsewhere.

The view of Federated Farmers is that devaluation is a step towards helping Britain, but that it will not stop New Zealand farmers from getting equipment. The best way farmers can assist Britain will be to make every effort to increase production for, by receiving extra food from New Zealand, Britain will be saved from spending dollars to buy food from hard currency countries. Federated Farmers, in a statement today, advocated sending salesmen to America to sell the merit ’of New Zealand’s butter, wool, lamb, grass seed, woollen goods, and anything else that could be sold to dollar countries. There should also be increased effort to interest Americans as potential visitors to New Zealand.