NEW ZEALAND TRADE

New Zealand Times, Volume L, Issue 11422, 19 January 1923, Page 9

NEW ZEALAND TRADE

MARKETS AND MARKETING STIMULATING INTEREST IN OUR TRADE ROUTES. OPENING UP OF NEW CHANNELS. At a largely-attended meeting of the Wellington Chamber of Commerce, held yesterday afternoon, a paper on “Markets and Marketing” was, by Invitation, read by Mr J. T. Martin, late president of the oliamber, who has justreturned from a visit to England and America.

Mr W. F. Cutbbertson (president), who occupied the chair, said that this was only the first of a series of papers which would be read by members of the chamber on subjects of special interest to commercial men. Mr Martin said that he wished to make a few remarks on a subject which usually commands the attention of members of chambers of commerce —our markets abroad. He was a strong believer in the necessity of stimulating interest in our regular markets and in opening up new channels of trade. Hence, he held, that while taking the fullest advantage of the splendid markets we had for our products in Great Britain, we should at the same time cultivate trade on the Continent, in Canada, U.S.A., and the East. Markets were opening up to-day in _ a way never experienced in pre-war times, and it should he our purpose to make the ever-increasing products of this young country fully known in every land where trade seemed practicable. Great Britain had the first call on all our exnorts, supplied us with the finest regular service of insulated and cargo steamers to he found in any part of the world, - provided adequate and up-to-date cool stores and unloading machinerv in London, Manchester. Liverpool, Bristol. Glasgow, and Hull, linked us up with good cable communications, and in countless wav® built up and maintained a direct. highway for trading, without calling on us to sunplv any portion of the capital; and, in return for all this we gave her of our f'est,.we responded to all heT exactions about high quality and grading, and we placed her on a preferential footina against the whole world in all our importations of manufactured goods.

BRITAIN’S PREFERENCE TO US? Great Britain’s statesmen are thinking out a way to reciprocate for this preferential treatment by us; , but, while we appreciated her good intentions. lie must confess he could not see how anything of a practical nature could be carried out. All the talk by politicians of creating by well-directed propaganda a disposition or sentiment in the United Kingdom r avcuTi-i> : 3 to the use of New .Zealand. Austisliaij, Canadian, and South .ifrica.i products against all others was not only chimericalj but calculated to raise false hopes in the Dominions. We all knew that in peace .times the average consumer did not concern himself whether the goods he purchased came from the Argentine, Denmark, or New Zealand, so long as the quality and price were, right. He remembered when he was in Glasgow in August last a strong newspaper controversy was raging over the action of the" Glasgow. city councillors placing a large order for tramway rails with the American Steel Corporation because the American price was £3OOO below the British firms’ quotations. Let them contrast this action with that of the New Zealand Government in placing an order for electrical' machinery in England, though'the American price was £15,000 lower. Practical business men knew that, talk as we would about preference and loyalty, the lowest price commanded the business; and the man who attached too much importance to sentiment stood a good chance of going to, the wall. England was essentially a free-trade country, and the only departure she had everi made from that policy was by fixing certain duties against tobacco, sugar, cocoa, tea, coffee) wines, and dried fruits. Any attempt to impose a duty on butter, cheese, wheat, wool, and frozen meat from foreign countries would never receive the support of the British public; and any form of subsidising steamers’ would meet with resentment from the already hard-pressed British taxpayer. When, in 1897; the question of preference to Canada was discussed in England, Sir Wilfrid Laurier, Prime Minister of" Canada, said: “I most assuredly do not imagine that the people of England would bo so unwise from their standpoint as to place in jeopardy a gigantic foreign trade, even for so good a purpose as to encourage colonial development. If they would do so, all the colonies would feel the benefit, but we certainly never expect them to do it.’’ The Imperial Trade Conference, which Mr. Bonar Law had pledged himself to convene as soon as circumstances permitted, would require in his (Mr Martin’s) opinion to direct its attention to other ways of assisting colonial trade and expansion.

NEED FOR NEW MARKETS. It was England’s policy, as, indeed, that of every country, to buy in the cheapest markets, and hence we must force our way .into new markets'for our exports, just as England herself was doing. The chairman of the British Imperial Council of Commerce, which met in London last June, said: “The Empire would not prosper on Imperial trade alone. It is necessary for all the Dominions, as well as the Home Country, to endeavour to increase the trodo with their friends the foreigners on all sides.” Canada, the greatest of the Dominions, exported more goods to the United States of America than to any other country. The producers of New Zealand had to pay full market value for all the machinery, stock, and labour they used in producing the primary exports, and hence they demanded full market value for thoir products. Full market value did not necessarily imply full market value in London, Liverpool, Manchester, or Glasgow, hut the highest price obtainable in any market in the world to which we had a reasonably good access. Hence it might be that to-day the United States of America might offer the best, market for certain commodities, France and Germany for others, and the Hast for others. The ability to take fall advantage of the high prices ruling in one country, as against the comparatively low prices in another, might make an enormous difference to the farmer producers of this countvy. This had been exemplified by the result in increased prices of the recent big shipment of butter to America.

To-day the cables ware conveying Inquiries from the United States of America for butter and wool, from France for butter; from Germany for wool, wheat, meat, and seeds; from Japan for wool, butter, meat, tinned goods, and wheat; from the East Indies for tinned milk, meat, and fertilisers; from Honolulu for apples, potatoes, onions, and meat; from Italy far tallow and

milk products; from Australia for oats and grass-seeds; and from the Islands of the Pacific for countless lines produced in this country. We must not neglect these markets, even though at present they did not represent a high 1 proportion of our export trade; but, on the contrary, do our utmost to foster them, realising that, though Great Britain to-day consumed 84 per cent, of our primary products, our production was constantly increasing, and a day would come when Great Britain would not be able to absorb such a high proportion. We must,, therefore, find in other countries the necessary outlet for our surpluses. Our production in many lines was increasing so fast that we would be obliged to look to other countries as we had never done before for markets. Those actively engaged in commerce knew what a stabilising effect a- number of markets with complete shipping connection had on our trade; it stiffened up our prices, enabled us to release goods destined for an over-supplied ana weakened market, and to divert them to a market where they: were in greater demand at higher prices, and in several ways helped to make the markets for that commodity more uniform. Producers then had the satisfaction that, at all events, they were getting full value for their products, instead of, as had often been the case in past years, forwarding shipment on shipment of dairy produce and meat to a market which at the time was fully supplied, and on occasion, seriously congested. DAIRY PRODUCE PROSPECTS.

In dairy, produce the increase last year, to end of December, on a butterfat basis, was 26 per cent., and recent good rains should ensure a continuation of that percentage. Values bad also advanced, and, though the" major portion of the season’s output was either afloat or unshipped, it was fairly safe to estimate that the final pay-out to the suppliers up to the end of this season would not be less than Is 6d per lb on butter-fat. Assuming, therefore, that production had increased 20 per cent, this year and values 20 per cent., both being conservative estimates, it meant that the dairy farmers of this Dominion would receive not lees than fourteen million pounds sterling against ten million pounds sterling last year. (This should gladden the Prime Minister’s heart.) MEAT POSITION. The total number of lambs killed last’ year was 4,474,600 carcases, and sheep 2,627,000 carcases. It was estimated that the number of lambs slaughtered this year would show an. increase of from 10 per cent. .to 20 per cent., but the actual killings would depend largely on the extent to which ewe lambs are sent into the works. On the other hand, it was estimated that the killings of sheep this year would be considerably less than last year. At the present moment, prices for frozen mutton were about 40 per cent, higher than the average for last year, and there was every indication of prioeo remaining firm. It was probable, therefore, that any decrease in the quantity of our exports of frozen mutton would be more than compensated by the increase in values, and the net return, to farmers for their lambs should show a. substantial increase on last year, taking the season as a whole. WOOL PRICES. Last year’s wool production was 633,000 bales, and, assuming this season’s to be slightly less, we should, according to one expert’s calculations based on higher prices now ruling, approximately secure- four and a quarter million pounds sterling above last year’s. This increase in value of our products would be reflected in the buying 'power of the farming community within the next three months, and should give considerable impetus to trade in every 1 direction, increasing our imports, - and absorbing our surplus unemployed population. Prices for all our primary produce were ruling high, but he was expecting a reaction in prices, indications of which were now apparent to those watching the situation. The Shrewd man of to-morrow would be he who took advantage of the present good prices ruling to-day to readjust his finances,' and acted cau'tioußly in the future. NEED FOR TRADE REPRESENTA-

, TIVES. To encourage trading in foreign countries we should see to it that we were better represented abroad. Canada had twenty trade agents abroad, ten in British countries, and ten in foreign countries, with an annual expenditure of £40,000, Norway had a splendid organisation in the United States of America, with a personnel of over fifty persons, and a consul-general in New York. In the United States Belgium had sixty consuls, Bolivia thirteen consuls, Brazil forty consuls and commercial agents, Chile fourteen consuls and a consul-general, France three consul-generals and big staffs, Australia a commissioner and staff ; while Great Britain had a hundred and fifteen consuls and vice-oohsuls throughout the United States of America.

We have no representation in America, excepting an o(d gentleman in San Francisco, whom we call an agent and pay £IOO per annum. This agent was no use whatever to the commercial community; and, though he was a fine, courtly gentleman, ,he, was completely out of touch with New Zealand trade. I found from inquiries that l Australia and Canada look after our interests, and both offices agreed as to the necessity of an established New Zealand representative. He was assured at the British Embassy that a New Zealand representative would secure a very good hearing at Washington, and receive as much consideration as if representing a country of twioe the population and trade. TARIFF RESTRICTIONS.

This country was doing a considerable business with the United States of. America, despite the restriction of the Fordney-McCoomhe tariff, and a good representative could, in addition to facilitating trade in many directions help Australia and Canada in representations they might be making from time to time against the high and excessive duties imposed against ourselves and every other country. Not only the duties, but other restrictions acted severely against New Zealand .and Australia, such aa refusal to accept New Zealand butter unless free from boracio acid, refusal to recognise the New Zealand Government biologist’s germination certificate of seeds, objections to our packing of goods, etc. We h'ad not widened our outlook sufficiently yet to embrace the Eastern trade. We should send at least one capable agent to visit the Eastern countries and report. At present the trade which should be ours was going to Australia, which had two Eastern representatives and a direct steamship service. He had come back from travelling abroad more than ever impressed with the splendid potentialities of this Dominion, and felt sure that if we concentrate on the primary products, which we knew how to produce so successfully, and by intensive and .scientific farming increased their production year by year, there was no occasion "for us to foster by high tariffs, and, at the expense of the general cc'""niunity, local industries for manufacturing products in small quantities that could -be so much more

cheaply made by large mass production in Great Britain and other lands. “MUST HAVE IMMIGRATION.’’ VVe must have immigration of the right .sort, men of the stamp of the early pioneers who were not afraid of hard work and hard conditions, who were not controlled by unions, and whose aim was to accumulate sufficient wealth to secure stake in the country and help to build it up on the right lines. The Vice-President of the Imperial Council of Commerce stated last year in London that: —“Inter-Imperial trade was a permanent asset to the British Empire which would be of lasting benefit in time of stress whenever war again took place; that every million emigrants sent from Home to Canada, South Africa, Australia, and ■New Zealand were worth £9,000,000 to the British trade of the country every year, as the average amount of trade with these countries and the United Kingdom worked out at £9 per head.” ruaDUCED TAXATION NECESSARY

Finally, some reduction must be made in the excessive taxation, which had become an intolerable burden, and was so seriously hampering t'he mercantile institutions of this country in their legitimate trade, stultifying their progress, restricting their means of assisting the farming community in their efforts to increase production, and compelling financiers in Great Britain and other countries with money to invest to refrain from placing it here. CHAMBER OF COMMERCE WORK. He called on many chambers of commerce in the United (States of America, and was much impressed with their large membership, splendid organisation, and mode of keeping in touch with all the city and country activities. The work of the chambers seemingly embraced every department of commercial and civic life, and entailed the maintenance of a large apd efficiently trained staff, many of vho'ta drew l substantial salaries. Cities of two and three hundred thousand populations oould support big organistions of this kind, especially on the high membership fees charged in the .United States of America, which, in the case of companies, ran up with some chambers to £l2, and for individuals from £3 to £6 per annum. He asked the manager of one mercantile house how he regarded the high fees, and he replied: “We pay it gladly, as we get service for it.” Merchants used the chamber of commerce for information to such an extent that every departmental chief had to be strictly up-to-date to comply with all requirements. For example, the chamber, in answer to a telephone call, would give to-day’s rate of exchange' with any country, the financial standing of merchants as they were graded in the United States of America, latest market reports, shipping movements, reports on any trade regulations, names and addresses of merchants in any particular calling and in any oity of the United States of America, political movements in connection with commerce, and so on. One department attended especially to the merchant visitors, particularly those from foreign countries, and in San Francisco waited on all incoming steamers. The regular weekly or fortnightly luncheons were most successful. At these lunoheona it was the invariable practice for some prominent American or visitor to address the gathering for fifteen or twenty minutes on some subject of interest. ' At one such luncheon he heard a prominent American judge .speak very interestingly on the many legal difficulties connected with Customs regulations. At another a merchant from the Argentine • gave his ideas in d plain, blunt way about extending trade with the United States of America. The American chambers of commerce had a very high standing in the community. One did not hear there, as here, that they accomplished very little, and were not sufficiently activd. The ' Government in Washington, through its Department of Commerce under the control of Mr Hoover, kept closely in touoh with the Associated Chambers of Commerce in a way totally unknown in this country. To visit the Bureau of Foreign and Domestic Commerce in Washington, which is under the Department of Commerce, and then visit the Associated Chambers of Commerce in the same city would quickly satisfy anyone that they worked closely together, exchanging information and helping merchants in every conceivable way in their trading difficulties. The primary purpose of the Bureau of Foreign, and Domestic Commerce was to facilitate commercial relations "between the" United States and foreign countries. To this end it acted as a clearing house of information and advice to manufacturers and exporters. The bureau assisted American firms engaged in foreign trade, by furnishing information concerning oversea markets; commercial conditions in foreign countries; nature of the coropetiiijkfo encountered and methods of meeting it; sources of supply of materials, especially raw products; tariffs, customs regulations, commercial laws; shipping and financing; and many other subjects. The . bureau maintained ’ seven district offices and tWeifey do-operative offices in the United States, a district office in Manilla, F. 1., and had. commercial attaches and resident trade commissioners in the principal capitals and commercial centres of the world, and a corps of travelling experts in various lines. The Department of Commerce had offices in eight large cities of the United States, and sixteen other centres co-operated and worked through the Chambers of Commerce. Impressed as he was with the splendid organisation of the ’ Chambers of Commerce in the United States, he would not suggest copying them in this country. America .was a country with a population of a hundred and "twenty She was » great, industrial and .manufacturing country, and 90 per centT of her trade was done within her own borders, only 10 per cent, being exported. With our small centres of population we could not hope to obtain a sufficient number of members or money to keep a highly trained staff of experts constantly at work, and, even if we could, there was no special call for such work. 'He much preferred the lines on which the Chambers of Commerce were conducted in the large centres of population in England, Scotland, and Ireland. There they confined themselves to matters which mostly come under commerce and trading, and made no attempt to carry on civio and social activities. He found in England that the. Chambers of Commerce and the Associated Chambers of Commerce, which met monthly in- London, were olosoly in touch with the Government, many of the officers being men of very nigh standing in the commercial community.. In America and in England a great deal more attention was paid by tho Government to the resolutions and findings of the Chambers of Commerce than prevailed in New Zealand, and, in many oases, the Government applied to the Associated Chambers fori information and advice. He attended the monthly meeting of the Counoil of the Associated Chambers in London, and was able to see at first hand how closely, the association worked in with the Government. He would like to see a great deal more attention paid to the deliberations of the mercantile community as communicated through the Chambers of Commerce in New Zealand than wae at present the case.

Our Department of Industries and Commerce was not a strong one, and tho laic Minister in Charge of that department showed that he had a very recode grip of the business. He hoped that the Rome Minister in his next appointment would see to it that this department was handed over to a strong member of the Cabinet. It was decided to hold a special maatinac to discuss the paper.