IMPERIAL TRADE OUTLOOK.

New Zealand Herald, Volume LVII, Issue 17652, 13 December 1920, Page 5

IMPERIAL TRADE OUTLOOK.

MINISTER'S REVIEW.

CURTAILMENT OF EXPORTS. FALL OF PRICES AWAITED. By Telesraph —Press Association—Copyright. (Received 7.30 p.m.) A. acd N.Z. LONDON. Doc. 11. A statement on the Empire's trade outlook was made by Mr. F. G. Kelleway. ! M.P., Parliamentary Secretary to the ! Department of Overseas Trade, in an in- ' terview with a representative of the Australian Press Association. Mr. Kelleway said that Imperial trade was none too bright, notably as regarded India and Australia. India was suffering from the reduced exportation of 100.000,0001b. of tea. which formerly had been exported to Russia annually. There was a good • demand for British goods in Canada and New Zealand. Both could buy and both were able to pay, but both were holding off in the anticipation of prices breaking. Australia was suffering from financial reaction, but he was confident that when the wheels of commerce were running smoothly again Britain would recover most, if not all. her lost trade, and also | her undisputed supremacy as a source of I supply. Australia had been importing I goods much exceeding the value of her j exports to Britain. Consequently, there | was a pronounced short-age of liquid funds in Australian banks in London. Referring to the wool position. Mr. Kelleway said that a fairly even flow of credit for Australia had been preserved during the last few years by the British Government's promptness in payment for produce purchased from the Commonwealth. On wool appraised in Australia payments were made in London within a fortnight of the appraisement, and the long otherwise might, have intervened pending the arrival of documents against shipment was thereby avoided, i Wool was now being released from, control, but the proceeds of the first three shipments in transit from Australia would not become available to the banks m London until the maturity of the drafts drawn against them. Furthermore, the British Government had paid in advance for wheat and wool exported l»*t July and August. Mr. Kelleway concluded : " From statements by Commonwealth Treasury officials it appears that the position created bv the above-mentioned economic factors is only a temporary position which will right itself when the present wool clip and coming harvest are realised. The present stoppage of credit, with the consequent heavy restriction of export business, is likely to endure until March unless the Commonwealth takes action in the meantime."

WEEK OF DEPRESSION.

TEXTILE TRADE NEGLECTED. SLOW FALL OF PRICES. Australian and N.Z. Cable Association. (Reed. 7 30 p.m.) LONDON. Dec. 11. After a dismal week the Stock Exchange improved somewhat yesterday. There has been considerable forced selling, chiefly of oil and industrial shares. This has abated during the past few days, and offerings have been fairly well absorbed, particularly in the investment sections. !News of the increasing output from the coalmines had a cood effect, giving a more hopeful tone, but there is still fear that further pressure to sell may b,e exerted before weak positions are entirely eliminated.

Foreign exchange movements have been mostly adverse to Britain, especially Scandinavian, owine to'the slackening of imports from the United Kingdom. A severe decline of the valne of Eastern currencies is a decidedly unfavourable development, ns it is preventing purchasers from operating in our markets, which is desirable to relieve our trade depression. Depression is still the outstanding feature of the wool textile industry. New orders barely •suffice to keep machinery running even for the short time now in operation. The piece trade shows no improvement. Stocks continue to accumulate in spite of drastic reduction of prices. Business in wheat is very quiet, sunplies exceeding the requirements of millers, who are holding off. expecting a frjther reduction. There have been a few sales of Australian parcels, but the Australian committee is not offering much. The freight markets generally are depressed, owing to an oversupply of tonnaee. One exception is Australia, for which the price asked for Januarv and May charters ranges from £5 5s to £5 10s a ton. though prompt steamers are obtainabV at £5 a ton.

The monthly index numbers of the wholesale trices of commodities, published by the Statist, show a steady decline since Ar>ril, amounting to 15.9 per cent., but prices are still 163 per cent, above the average of 1913. The Statist points out that since April the cost to the consumer has become lower fn some lines, notably textiles, but in many cases retail prices have actually increased, while the general retnil level does not show a fall parallel with the fall of wholesale prices. The present decline is due to the restriction of banking credits, and is greatly helped bv a mnrked abstention of consumers. It may be reearded as the natural reaction from the abnormal and laVcrely artificial enhancement of money values, which beean soon after the armistice, and will contirme till prices are reduced to a level at which banking resources willagpin be sufficient for the requirements of the trade.

The cheese market is dull, and sup-plies very large. Tt is* pstimated that the Government holds 12.000 tons, stocks of Canadian cheese, afloat and available, amount to 10 000 tons. There are also lartre stocks of home-made cheese. Consequentlv retailers are refusing Government eb°ese. and are sellinc home-made cheese It is stater! that retailers refused 80 per cent, of the last allotment