MEAT FREIGHTS

Otago Daily Times, Issue 18445, 5 January 1922, Page 6

MEAT FREIGHTS

“NOT UNREASONABLY HIGH.” REPORT OF IMPERIAL SHIPPING COMMITTEE CAUSES OF EXCESSIVE COSTS. SUGGESTIONS TO THE SHIPPERS. An important report concerning the freight rates charged by the shipping companies trading between Britain and New Zealand has been issued by the Imperial Shipping Committee ’ Representatives of the Imperial Government, the overseas dominions, and comrnercihl interests sit on this committee, which was established in 1920 in conformity with a resolution of the Imperial Conference. The New Zealand Government asked last year that the committee should investigate the freights charged by the lines trading to New Zealand, and it placed before the Imperial authorities at the same time a report of a committee of the House of Representatives, which had expressed the opinion that the freights were ‘‘unwarrantably high.” The Imperial Shipping Committee does not uphold this view. JThe percentage of freight paid to the price received, c.i.f.e., has risen in the case of beef from 15.5 in 1913 to 42 per cent, in the summer of 1921 in the case of lamb the proportion is still low, 15.5 per cent, in 1921, as compared with 11.2 in 1914, while in the case of mutton the prewar proportion of 13.2 per cent, compares with a present percentage of 26.8.”/ states the committee. “This rise in percentage of freight is no doubt largely responsible for the feeling among the _ producers that freights have been maintained at unduly high levels during the present depression. Freights are undoubtedly high, but it must be emphasised that the prices realised depend upon market conditions in the United Kingdom, which are only remotely connected with the cost of running ships. The evidence before the committee tended to show that shipping costa had risen by 1920 to about three times the pre-war level. Since 1920 these costs have fallen to some extent, but very much less than prices generally. RIVER PLATE AND N.Z. FREIGHTS. “To apply another test we have examined the current freights for frozen beef from the River Plate. The two trades are in direct competition in the same market. The latest quotations for freights on Argentine frozen beef are lid per lb, corresponding with IJd plus 5 per cent., for the same commodity from New Zealand. The disstances involved are approximately 6300 and 11,400 miles respectively, so that the rates on mileage basis are .44d per tonmile for the Plate trade, as compared with ,35d per ton-mile for New Zealand. A closer comparison is afforded if we take into account the time occupied on the respective round voyages, including coastwise itinerary. In the case of the Plate trade we understand this is about 90 days, while owing to various causes the round voyage to New Zealand now occupies in nearly every case well over six months. Tha result is that while a Plate vessel can earn under present conditions during the year on each pound of meat for which she has room about sd, as a maximum, the New Zealand vessel can only earn about 3^d. “Thus, whether we consider the costs of the shipowner relatively to the freights charged or the comparison with the River Plate trade, the argument thus far tends to show that though the present freights are undoubtedly a. heavier burden upon the Now Zealand producer than the prewar freights, or than the Plate freight may be on the producers in that region, they cannot be regarded as unreasonable when compared with - either. PROFITS FROM NEW ZEALAND FREIGHT. ‘■As a third and final test we have made direct investigation into the question of profits derived ftom the New Zealand freights. The general evidence given to us by Lord Inchcapo was to the effect that while the shipping companies concerned were making profits in 1920, the whole of those profits would be wiped out this year, and there wa&,no prospect of any recovery in sight. In his judgment the big lines would be in a worse position at the end of 1920 than they were at the end of 1913. “Wo have had before ua more specific evidence. Through the courtesy of certain shipowners engaged in the New Zealand trade, definite audited information as to the outgoings and incomings for a continuous series of round voyages in that trade during the first half of the present year (1921) were made available in con-' fidenoe, and the results were submitted to the committee. We are of opinion that these show, oven if we attach relatively low capital values to the ships in question, that the freights earned were not unreasonable. “The unusually prolonged round voyage in the New Zealand trade intensifies the disadvantage at which that trade is placed as compared with the Plate trade." Wo have accordingly made careful inquiries into the general conditions of the New Zealand trade, and have obtained • statements from the shipping companies concerned. From these statements' it appears clear that the prolongation of the voyage is largely due to the practice of collecting the cargo of the same ship at many different and widely distant ports, and to the multiplicity of parcels and of marks, sub-marks, and grades, the sorting of which on discharge involves loss of time and extra labour. Undoubtedly the earning capacity of the ship would be considerably increased, or, in other words, the cost of transport would be reduced, if some practical steps could be taken to simplify these practices. With this object in view the shipping companies and the shippers . might advantageously cooperate. “A further factor of much importance has to be kept in mind. At present outward cargo to New Zealand is very scarce, and consequently the homeward cargo has to bear a disproportionate share of the cost of the round voyage. In 1913 the total weight of iron and steel products exported from the United Kingdom to New Zealand was 114,000 tons, but during 1920 it was only 54,500 tons, and during the first seven months of 1921 it was 18,000 tons. The figures for all the United Kingdom exports to New Zealand are, roughly, 160,000 tons in 1913, 89,000 tons in 1920, and 38.000 tons during the first seven months of 1921. “Our general conclusion is that under existing conditions the current freights charged by the lines trading to New Zealand aro not unreasonable.” MULTIPLICITY OF MARKS. A statement as to the conditions of the New Zealand trade was placed before the committee by the Shaw, Savill, and Albion Company, Limited. The company emphasised the difficulties arising from tha multiplicity of marks. The statement was' as follows: ‘The difficulties which have to be contended with, and which cause much direct and indirect expense to the shipowners are chiefly the following:— (a) The numerous freezing works whose output has to be lifted and the number of ports which have to be visited. (b) The multiplicity of bills of lading required by shippers from each freezing works, the multiplicity of separate marks on most of the hills of lading, the number of consignees and the splitting up of the deliveries by the consignees. (c) The inadequacy at times of the storage accommodation in, Britain, leading to excessive delays' in discharge. (d) The go-slow policy here and in New Zealand of the workmen. “In regard to (a) there are 59 freezing companies or works in New Zealand, each with a separate output. There are 18 ports, each of which the steamers are required to visit to lift meat at least once a month during the season. Many of the works have limited storage accommodation, and all desire the promptest, clearance of their prepared output. These works occur from Whangarei, at nearly the extreme north of New Zealand, to the works at Bluff, in the extreme south; most are situated on the east coast, but some are on the west. ‘ln regard to (b). probably the experience of the Matatua, now discharging here, will give some idea of the conditions. This vessd is not exceptional, except that she does not carry as much meat as some of the other - steamers in the trade, and the details of marks, etc., are rather better than the average; moreover, she, loaded meat at only two ports:— No. Carcases shipped 116,002 Separate bills of lading 181 Separate marks ... 701 Separate marks each of 10 carcases or less 158 Consignees 32 Deliveries 196

“Under such conditions mis-deliveries are inevitable, and cargo left on hand never realises the amount claimed and paid for short deliveries. The position in regard to (c) is doubtless ■well known to your committee. Discharge has frequently had to be delayed in commencement, and later stopped for want of accommodation for the moat; this holds up the steamer and increases the cost of the discharge. “In regard to (d) the following are a few instances of the time occupied in Now Zealand in loading (a portion of the time being occupied in changing ports), and in Britain in discharging the steamers. Steamers marked (e) arrived in New Zealand empty: Arrival in London ' In until N.Z. discharged. Steamer. Days. Bays. Waiwera 41 30 Zealandio (e) 46 25 Maimoa (e) • 54 44 Corinthio (e) 40 30 Raranga 64 55 Waimana (e) 35 36 Mahana 1. 48 40

“In our view (aj is not likely to be remedied materially, the New Zealand desire for localisation being so strong; that, however, is beyond the shipowners’ _ influence or control. We believe (b) might be materially improved without disadvantage to individual shippers, but this, again, lies outside of- the shipowners’ province. Undoubtedly (c) can bo remedied, and we trust (d) will gradually be improved as the general disruption during and following the war is replaced by a more moderate attitude on the part of the workmen, and an approach to normal conditions ensues. “Manifestly any diminution in the number of ports visited, any reduction in the work of sorting and delivering, with resultant claims, any more rapid discharge, and any better work done will, _ separately or in combination, result in diminished expenses, and so enable the shipowner to carry the cargo at lower rates of freight.”