Farmers Exchange

Manawatu Times, Volume LV, Issue 6764, 23 January 1932, Page 8

Farmers Exchange

Comparison of Indices (Contributed by Farmers’ Exchange Committee.) On Wednesday, the 13th January, a conference was held in Wellington consisting of members of the Meat and Dairy Export Control Boards, together with representatives of tho Fruit Board and tho Sliccpowncr’s Federation and also Mr. W. J. Poison, the resident of the Farmers’ Union. The Meat Board is elected by the shccpfarmcrs. The Dairy Board by dairyfarmers, the Fruit Board by fruitgrowers. The Sheepowners Federation has always been regarded as the authoritative body eu all matters connected with wool. The Farmers’ Union embraces in its activities all farm interests. The conference was therefore the most representative body of farm interests that could be obtained. The object of the conference was to consider the farmers problems srising out of the present economic crisis. Amongst other matters the conference considered the recent action of the Government in commandeering Export Exchange. It was resolved unanimously to make a strong protest against this action on the ground that practically all export exchange was tho property of the farmers and the Government commandeer was. taking farmers property at less than its market value. Representations in this connection were made to the Government. This has already been reported in the press. Subsequently a committeo of four was set up representative of the whole conference to keep in touch with the situation and with the Government with a view to helping farmers as far as possible in their difficulties. Tho members of this committee arc—Messrs David Jones, Chairman of tho Meat Board, IV. lorns, Chairman of the Dairy Board, 11. D. Acland, President of the Sheepowners’ Federation and member of tho Meat Board, and W. D. Hunt, member of both the Meat and Dairy Boards. This committeo has decided to prepare matter from time to time dealing with the economic position of the farmers.

Before any comprehensive remedies for the plight of our primary producers can be intelligently considered by the county as a whole, it is necessary that the farmers’ position should be understood. A diagnosis of his ease must be stated. Tho Government statistician has for years published in the Official Year Book an export price index and a farm expenditure index. As exports from New Zealand consist almost entirely of farm produce and as prices fo farm jiroducc sold for local consumption are largely fixed by the export prices ruling, the export price index shows the level of values that farmers have obtained for their products. The farm expenditure index shows the farmers’ production costs. In eacli index the year 1914 is taken as the base and is called 1000. Wo give these indices side by side as follows: —

Tljo foregoing table shows tho position our farmers aro in through the sudden fall in the export index column without a corresponding fall an the farm expenditure column. But lor the ten per cent, premium that now obtains on exchange, the export price index for the ten months January to October 1931 would have been 757, The average export index figures for tho sixteen years 1914-29 inclusive is 1448. When a level of value obtains for as long a period as sixteen years, all costs adjust themselves to that level. This is evidenced by the fact that the average of the farm expenditure column for the same sixteen years is 1479.

These two indices set out the problem that we are faced with. The real problem is stated in tho farm expenditure index and export prico index for the ten months, January to October, 1931: Farm expenditure index, 1500; export prico index 874.

There is tho whole problem in a nutshell. Our farmers arc selling their goods on the export index of 574 and meeting production costs on tho farm expenditure index of 1500. This cannot long continue. Our farm industry is out of plumb, and unless it is quickly brought back to tho upright position, the whole industry will crack. As our farming industry is tho foundation upon which rests every, other industry and occupation in the country, it follows that if the farm industry cracks, if it is not firmly planted again in an upright position the whole economic life of the country will crack with it. The task of economic re-adjustment is to spread evenly tho loss of income over the whole community with the minimum disturbance to existing arrangements. Tho problem is clear. What is to bo done about it?

Y ea r Farm ExpendiExport Price ture Index Index .1914 1000 1000 1915 1090 11S7 191(5 1195 13 SO 1917 1284 1574 1918 1452 1023 1919 1511 1071 1920 1001 1045 1921 1000 1523 1922 1543 1140 1923 1593 1403 1924 1580 1597 1925 15S2 1702 1920 1555 1377 1927 1574 1300 1928 1042 1520 1929 1030 1456 1930 1028 1144 Jan/Oct. 1931 10 months 1500 874