MEAT INDUSTRY.

Hawera & Normanby Star, Volume XLII, Issue XLII, 3 May 1922, Page 6

MEAT INDUSTRY.

PRICE WAR

DUMPING IN ENGLAND

AUSTRALIA FARES BADLY

SYDNEY, April 14. No hope for an early improvement in the market for Australian meat is held out by Mr Alex. Hay, M.P. for -New England, who returned to Sydney this week after a hurried visit to England. The present depression, according to Mr Hay,1 is due to a price war, which is waged by South American interests to the detriment of the industry throughout the world.

"As the result of information I have gained in London," said Mr Hay, in the course of an interview yesterday, "I regret to say that the impression forced upon me as to the future of the Australian beef trade is very discouraging. Before the war Vesteys had no works in the Argentine, but their plant there was finished soon after the outbreak of hostilities, and now they are shipping from 10 to 12 per cent of the total beef shipments of that country. Until about a year ago practically the whole of these beef shipments of Vesteys from the Argentine went to the Continent of Europe. When the Continental markets collapsed in January of last year they had to divert, the supplies to the English market, which has had to take the bulk of it. The same applies more or less to other Argentine shipments. About 18 months ago Vesteys bought from the British Government a very large quantity of their old stocks of beef, which had accumulated during the war, and which, of course, they have been selling in Great Britain ever since. This naturally has helped to depress the market. The quantity taken over is estimated to be about 1,500,000 quarters. It had been reduced at the time I left England to about 160,000 quarters, , two-thirds of which, I am informed, is New Zealand beef. Various offers and proposals were being made by Germany and Austria for the purchase of this meat. Austria wanted payment spread over 20 years, and Germany's best offer was 2|d per lb. Vesteys, who have suffered a considerable loss already on the deal, were unable to accept the offers made unless compen|.sated by the British Government or the growers who produced the meat. Both I the British and New Zealand Governments, I understand, refused, but the Commonwealth Government expressed its willingness to stand more than its share of any loss in order to get this old meat off the market. Nothing had i been done, however, when I left Lon--1 don early in March. The removal of j this meat is not going to solve the beef ( problem altogether, but it will to a small extent relieve the situation." "Ever since January of last year," continued Mr Hay, "when the Continental market failed, a price war has been going on between Vesteys, on the one hand,, and the Argentine, American, and British companies operating in South America on the other. This beef war was caused not so much by a struggle for supremacy as by the fact tfiat there is no agreement between the parties. Disputes and recriminations have taken place, and the present deplorable condition of the beef market is evidence thereof. Latterly this price war has taken the shape of the dumpW. 1* England of Argentine chilled beef belonging to both Vesteys and the other companies, the value of which is tar in excess of what the season can absorb, Enormous losses are, therefore, being made by all interested in the shipment of beef to England, no matter fronvwhat country. Peace between the feouttL American exporters would have the immediate effect of restriction of shipment. This would at once result in improved prices, and would perhaps allow Australia to presume the export of beef again. It is difficult to say what the losses on these Argentine shipments must be at the present time but wi?i °?J imated at £100,000 a week. While the fight lasts it is quite impossible for any profitable business to be done between Australia and Great Britain The present position is aggravated by the balance of the old beef stock belonging to Vesteys, and the situation would materially improve if this old stock could be taken* off the market. Something more |is needed, however, to bring about a permanent cure for the Australian beef market. Ihe cost of production and freights must come down. A better selection of export quality must be made, and a better dressing and general appearance insisted upon. In this regard the Argentine excels Australia, whereas before the war the reverse was the case Better means of distribution at the other end would be a direct benefit, for in this direction, too, South America beats 3L Jke Commonwealth Government, should follow the example of New Zea- ! iand and license exporters. | ■ "Generally sneaking," concluded Mr i Hay, it may be taken for granted that unless the shipments of chilled and frezen beef from South America are reduced by at least 20 to 25 per Sat ll °^°f *? SeU^ Australian meat on the London market is very unsatisfactory. The question of Empire preference is, of course, one which would have an enormous benefit on the industry. Yet, whilst favoured in many quarters, it is difficult to bring about ' wl mean T' and until the worW gets back to work and the purchasing power of bankrupt nations is restored the depressed market must remain » '