VITAL POINT

Hawke's Bay Tribune, Volume XXV, Issue 158, 20 June 1935, Page 7

VITAL POINT

PRODUCE PRICES

OUTPUT AND DEMAND Food Consumption Too Low STRONG PLEA BY MR. FORBES (Supplied by N.Z. Government) (.Received 20, 10.30 a.m.) LONDON, June 19. A plea for an exploration of the possibilities of increased consumption of foodstuffs was made by the Rt. Hon. G. W. Forbes today in an address to the National Farmers’ Union conference. He said that New Zealand and British farmers had so much in common that it would be disastrous for both the farmers of the United Kingdom and the farmers of New Zealand, if they approached their difficulties in a spirit of antagonism.

“We have always recognised the prior right of the United Kingdom farmer to his domestic market, ” sail. Mr< Forbes, “and during tile reevm discussions we have repeatedly iterate J this point. We do say, however, t-bai after you have taken your share ■>! the market we are entitled to sta-i.i.u preference, with the foreigner thir-J I am confident that such a policy wy/lil be approved by the United KingUon. farmer, and it would certainty l.i agreeable to us. “The next factor that concern* u» is prices,” he continued. “Uutvso «■<• cun obtain practicable prices iv 'mi produce we cannot continue in |,..eduction, and if our suppliers of luudstuffs and raw materials go out of production the manufacturing section of our people will also suffer. No group in the community can suffer hardship without affecting all other groups, and it might be wise for those who are clamouring for unduly cheap foodstuffs to bear this in mind. After all, we, as farmers, form a considerable market for manufactured commodities, and it is the equitable exchange of goods and services which is responsible for the continuance of trade aud commerce. INCREASED PRODUCTION. “To-day the primary producers of the world are faced with glutted markets and depressed prices. It has been said that we farmers are too efficient; we have increased out output to isuch an extent that we have glutted the markets. Judging by prices alone there is no doubt that this is the case; we have overrun the effective demand for our produce, and those in control of the markets are urging us to go. slow. This has happened even in the United Kingdom, which up to a few years ago was looked upon as a bottomless pit- for the foodstuff's and raw materials of the world.

“There is no ijloubt that, the position has been aggravated by the policy of economic nationalism which has prevailed in most other countries during the post-war years,” said Mr Forbes, “but at the same time it has been definitely established that the increase in the output of produce has been greater than the increase in population. From 1913 to 1929, the peak year of production, the population of the world increased by eleven per cent., while the increased production of foodstuffs and raw materials was no less than thirty per cent. CALAMITOUS RESULT. “So far as the farmers of the world are concerned, the result has been calamitous, and in some countries the authorities have even gone so far as to destroy food and stock. The destruction of coffee, ploughing in of cotton and wheat and killing of live-stock have shocked those farmers who have concentrated all their energies and enterprise on increasing their production.

“It seems a tragedy that the foodstuffs of the world should be destroyed at a time when we all know that the capacity of the. people to consume has not been fulfilled. It is to this aspect of the problem that I think we should address ourselves. We in New Zealand consume forty pounds of butter per head per annum while the yearly butter consumption of England per person is only twenty-five pounds. This means that in England each individual eats on an average about 7) ounces per week or about one ounce per day, so that the average cost of butter consumption in England with the price of New Zealand butter what it is to-day, viz., 1/- a pound retail, is less than sixpence per week and less than a penny per day. We are told by medical scientists that butter is au essential foodstuff, especially for children, and less than a penny a day is spent on it for every inhabitant of this country. UNDER-CONSUMPTION. “It does not seem that there is yet an over-supply: rather there is underconsumption,” Air Forbes added. “In the case of meat a similar example may be cited We in New Zealand consume 163ibs. of beef and veal per capita per annum, while in Great Britain the quantity is not much over lOOlbs. Our mutton and lamb consumption is 631bs. per annum, while yours is only 331bs, 1 could continue this comparison in many other branches of basic foodstuffs, and I may point out also that there are inauy other countries in the world which have lower standards of consumption than Great Britain. “Is it reasonable, then, for ns to say that tlio limit of our capacity to absorb the fruits of the soil has been reached and that we must henceforth stagnate or aven decline?” asked Mr. Forbes, -“Oeitsimty in the present sit.

uation there is apparent over-produc-tion, but while there arc large sections of people receiving inadequate nutrition we must address ourselves to the problem of raising consumptive standards. At the same time we should not be misled by inflationary quick remedies which would lead us to disaster. PRICE DISCREPANCIES. “Perhaps our immediate task should be along the lines of narrowing the discrepancy between the prices of goods and services which the farmer needs and the prices, which his produce commands on the markets of the world. It has been correctly stated that this discrepancy is one of the major causes of our present plight. 1 need not stress tho fact that manufacturers cannot continue to sell their products to bankrupt farmers. In the exchange of foodstuffs and raw materials for inamSactured goods, it is essential that both sides make a profit, otherwise trade ami commerce cannot continue. All transactions, to be successful, must be based on principles of equity and we must make every effort to correct the unbalanced situation which exists to-day.” Continuing, Air. Forbes said that tho result of the Ottawa regulations satisfied New Zealand, but the prices for beef and dairy products were giving grave concern. It was because New Zealand recognised tho necessity for profitable prices that she agreed to the regulation of the meat market in the interests of tho British and Dominaa farmers alike.