TEA SUPPLIES

New Zealand Herald, Volume LXXVI, Issue 23507, 18 November 1939, Page 7

TEA SUPPLIES

minister's Statement REPLY BY THE TRADE J DISAGREEMENT EXPRESSED FINANCING OF IMPORTS Disagreement with remarks made by the Minister of Industries and Commerce, tlig Hon. D. Ov Sullh an, on the tea situation in the Dominion is expressed in a statement prepared following a largo meeting - yesterday, in which practically every importer and wholesale distributor of tea in Auckland was represented. The statement takes strong exception to the claim by Mr. Sullivan that sterling funds have always been available for imports; on the contrary, it is contended, funds have never been available in a way satisfactory to overseas shippers. Licences for 1939 were issued on the basis of payment spread up to June, 19-10, and 1910 licences, merchants understand, arc now to Jje issued on the basis of four months' credit. Sellers in Ceylon regard this arrangement with disfavour, as they can sell to other countries for cash. From this, it would not appear that sterling were always readily available.

Developments Reviewed "In view of the statement made by the Minister of Finance, the Hon. W. , Nash, and also by Mr. Sullivan, that arrangements had been made to ensure that all tea requirements for somn months would be available, it might, appear to the many hundreds of harassed storekeepers who cannot obtain tea that the blame is ar.tachabl« to the merchants," continues the statement. "The facts are that, at the inception of the Reserve Bank permit system, tea stocks in New Zealand "were normal. Because the usual prompt payment system was not available, shipments from Ceylon have, dropped in three months by. approximately 1,250.0001b. "However, there is no real reason for panic buying, as ample supplies for immediate needs are available in India and Ceylon, and shipping is also available, although not quite so regularly as. before. Stocks and 351ertaing "Had funds been available for normal trading—that is, had there been the necessary London funds —merchants are definitely of the opinion that the stocks usually held by blenders would have been sufficient to cater, for tho recent demand, abnormal though it admittedly has been. In other words, at least an additional four weeks' stocks would have been held, this delaying the recent price increase by the same period, four weeks. This would have represented a saving to the consuming public of approximately £20,000."

Regarding Mr. Sullivan's statementthat 2,485,7051b. of tea were in store on September 8, merchants make the reply that it does not necessarily follow that this quantity was available or, suitable for consumption. The averag>3 blend comprises frbm 10 to 20 types of tea, and the idea, in blending was to keep each blend uniform, for the public would object to' variations in quality. "It is true as the . Minister states" that 80 per cent of Ceylon and Indian tea was commandeered; but this measure was for a very short period and it was due to a misunderstanding," the statement-adds. "It affected the position in New Zealand but slightly.''

PRICES IN AUSTRALIA STATEMENT BY MERCHANT • The statement tliat the Minister of Industries and Commerce, the Hon. D. G. Sullivan, was astray in his facts when in the course of # remarks on the tea supply situation in New Zealand he said that the price.;of tea .was advanced by 6d per lb. in Australia in the, first week- of the war. was made yesterday by an Auckland merchant.. t Mr. Sullivan's to Australia was made when instancing the_ effect of the price -stabilisation regulations in New Zealand in delaying a price ad- t~ vance. A -■ This merchant produced _ a circular issued by tea distributing interests in Australia recording on October 9 what., was described as the .first price advance since September'l. The advance ■was 3d per lb., not 6d, and the information was given that it had been authorised after investigation by the Price Commissioner. The advance was general. " Up to November 10, when the last information on the tea market in Australia was given to the Auckland merchant, no further advance had occurred in Australia. The first and only advance of 3d was based on the system of averaging costs.