FREEZING CHARGES

New Zealand Herald, Volume LXXV, Issue 23206, 28 November 1938, Page 12

FREEZING CHARGES

EAST COAST WORKS , POSSIBILITY OF INCREASE £9OOO LOSS AT TOKOMARU BAY [BY TELEGRAPH OWN CORRESPONDENT] GISBORNE, Sunday The possibility of freezing charges at the Kaiti and Tokomaru Bay works having to bo raised unless there a substantial increase in the number of stock killed at the two works was mentioned by Mr. If. B. Williams, chairman of directors of the Gisborno Sheepfarmers' Frozen Meat and Mercantile Company, Limited, in his address at yesterday's annual meeting of shareholders in the company. "The season under review has been far from satisfactory and the record floods of February and May, plus the facial eczema outbreak, had a disastrous effect ou stock in this district," said Mr. Williams. "The flush of feed helped cattle, but retarded tho fattening of sheep, and in the case of the Tokomaru Bay factory resulted in the lowest killing experienced for many years. The steady increase in wage rates during recent years, _ combined with the reduction of working hours, must carry with it a proportionate increase in production costs: in fact, the freezing workers' award filed in January last meant an increase in costs of roughly 11 per cent, while freezing charges remained the same. If you add to this the fall in the value of byproducts and the reduced turnover one does not wonder at the freezing department loss. "Taxation is again increased by the social security charge of Is in the £ and this, together with the uncertain market for by-products, forecasts a revision, of charges in order to meet the position. The outlook for the coming year is not rosy. Stock valuos appear to be lower and no one would attempt to forecast the wool position, but costs must increase." Tho possibility of tho works at lokomaru Bay being closed down was mentioned by the chairman in reply to Mr. V. C. R. Mitford. He said that the Kaiti works had shown a profit of £3OOO, whereas tho works at Tokomaru Bay had shown a loss of £9OOO. "Have the directors considered the Sossibility of saving money by closing own at Tokomaru Bay?" asked Mr. Mitford. The chairman explained that farmers in the coastal district had been circularised on the matter. The works were to be given a further trial under what the directors believed to be more promising conditions, and if this experiment was not more successful the closing down of the works seemed inevitable.