COMMODITY MARKETS AND PRICES.

Manawatu Standard, Volume LX, Issue 168, 15 June 1940, Page 12

COMMODITY MARKETS AND PRICES.

’ ITALY’S TRADE LOST. (By “Penloo.”) The greater part of the world loses the trade of Italy, but the loss to Italy is greater than the Joss, say; to the British Empire. By entering the war, Italy loses no small amount of her merchant shipping, and greatly facilitates the Allied blockade. To-dav, Italy can trade only with her immediate neighbours, and they can supply her with very little of the essential war materials, such as oil, rubber, cotton, wool, metals, and coal. Italy must import these commodities, and they must be imported from countries outside of Europe. These imported goods must reach Italy via Gibraltar Straits or the Suez Canal, and both avenues are now closed. It is reasonable to suppose that she has laid in stocks'of these.war materials, but consumption in wartime is on a huge scale, and when oil storage plants and other materials are raided by Allied aircraft Italy will soon find her stocks exhausted. After the war, also, Italy will suffer from, lack of foreign trade. There is every prospect that Italy will lose Abyssinia, and that the former Emperor Selassie, the “Lion ot Judah,” will again Become the Negus of Abyssinia, and the experience lie has gained in exile should make him a very good ruler of his country. It may happen that Abyssinian trade after the war will not be the exclusive privilege-of Italy, but will pass mostly into the hands' of the British, who have befriended the exiled monarch, and who will be instrumental in extricating his country from Italian domination. Italy may also lose Libya, which was originally French, and was ceded to Italy in recompense for her assistance to the Allies in the last war.

New Zealand sends* Italy very little of its produce; for example, in the first quarter of this year our total exports to that country were valued at £l3l, while oiir imports reached £54,460- These figures are given in the Monthly Abstract. The export figures perhaps do not represent the true position, for it is more than probable that Italy buys our wool at the London sales, and possibly buys other goods such as hides and skins. But the total cannot equal the amount we have to pay Italv for imports. The loss of the New Zealand trade is of more importance to Italy tlian it is to the Dominion. At one; time there was some prospect of doing - a trade in frozen meat with Italy, and some small shipments were sent to Genoa, but the kind of meat Italy wanted meant special preparation here, and as the volume of trade could not possibly be very large the business was dropped. But in a world balanced economic trade system we cannot do without the trade of any one country, and now the world is minus that of Germany and Italy, while Japan’s and China’s is precarious. World progress and prosperity depend upon each country exporting and importing as much as possible. The exports provide work for the people, and the amount realised enables a country to pay for imports. The imports of one country are the exports of another, and the people of this country are kept busy preparing goods for export. Thus exports and imports provide the people of each country with work. In the production of goods for local, consumption and exports, a.ll the producing industries in the country must be in balance, for they are dependent upon one another. For example, long working hours on the farm, which of course are inevitable, must be equated with reasonable working hours in the factory. If factory hours are reduced to a point below a reasonable level, so as to upset the balance, then eco : nomic trouble is inevitable. Costs of production in both factory and firm are increased, and the prices of the resultant products rise. This assumes that the products of both farm and factory are consumed locally. In our case it is not so: Factory production in the main is absorbed locally, and therefore the factory can pass on the increased costs of production to the consumer in higher prices. The farm cannot pass on increased costs except to the extent of the produce consumed locally. The bulk of farm production is for export, and the producer cannot pass on his increased costs to consumers in other countries. The'4o-hour work week lias disturl>ed the economic balance, and the increased prices- of commodities are affecting adversely the farmer’s costs of production. The local consumer will tolerate a certain advance in prices, but when the advance begins to have a serious effect on th r cost of living then there is the appeal for higher wages. Short hours and high wages are detrimental to the economics of a country. Shorter hours lessen production, and short hours and high wages add to costs, and manufactured goods cost a ereat deal more than thev should. With every rise in the price of goods some peonle have to go without or buy sparingly. There has been a suggestion that the 40-hour week should be suspended for the duration of the war, so that longer hours may be worked and more produced to help win the war. LONDON. Juno 13. The price of rubber is 13Ad a lb. The price of tin is:—Spot, buyers, £2BB 15s a ton: sellers, £289 ss; . forward, buyers, £289 15s a ton : sellers. £290. s\ NEW YORK. June 13. Tin 58 cents a lb.