GRAIN MARKETS.

Otago Daily Times, Issue 19980, 23 December 1926, Page 6

GRAIN MARKETS.

The wheat-growing industry in New' Zealand continues to be beset by many difficulties. The spring of 1925 was most unseasonable, and heavy rains resulted in a big falling-off of the wheat returns. The farmers had promised to assist the Government and the millers by planting as much wheat as possible, and they in their turn were promised a minimum price. The farmers did their best to honour their promise, but the continuous rainy weather forced many of them to plant their land with other crops. The result was that there was a considerable shortage, and that millers were hard put to it to secure supplies. In many instances they had to pay more than the minimum price of 7s agreed on, and the position arose that North Island millers began to look to Australia not only for supplies of wheat, but for supplies of flour. The North Island millers particularly also decided to purchase wheat from Canada, and the farmers of the Dominion are now wondering what the future holds for the wheat-growing industry. The operations of the North Island millers in importing flour has reacted verv severely cn the South island millers, as they have lest much of their flour business in the north. What would have happened, however, if the importations of Hour had not been brought to the North Island it is difficult to say, as South Island miners would have bad to get wheat somewhere to fill their orders, and there is no question that the price ot wheat would have gone i.igher than it did. It is stated rhat up to November 25 25,306 tons of Australian flour were imported into New Zealand, and a few hundred tons more will have to be brought in before New Zealand millers can hope to meet all their orders. It is understood that 222.009 acres have been sown down in wheat for the present season, and that there will be 6,000,000 or bushels available. This will mean a shortage of. say, 2.000.000 bushels, but the possibility arises that there may be no shortage at all—that some millers and merchants may bring in Australian flour, and thus restrict the demand for the New Zealand-made article. At a largely attended conference of wheatgrowers held at Ashburton early this month it was decided to ask the Government to impose an embargo on the importation of flour, or, alternatively, to increase the present duty of £3 per ton by £l. It was also decided to proceed with the formation of a grain-growers’ marketing organisation. A committee has been set up to give effect to these decisions. It may be added that there is a duty of 2s per cental'on imported milling wheat, but that wheat for fowl food can bo brought in free. New Zealand farmers maintain that they cannot grow wheat at a profit at a return of 5s 6d. but that 6s-6d'per bushel will pay them. It cannot be denied that the crop returns in New Zealand: have bean decreasing year by year, and it remains to be seen whether the wheat prices, in the face of the outside competition, can be raised to such a figure as will encourage farmers to continue to grow wheat. It seems quite clear that North Island millers are determined to 1 ■ wheat requirements outside of Now Zealand if they can do so at a profit, and also flour for that matter if they can get it cheaper than they can mill it themselves. It can easily be seen therefore that unless the growing costs in New Zealand can be reduced there is a likelihood of the wheat-growinc industry in New Zealand getting into an oven worse state than it is at present. Of course, the Question of the cost of the loaf plays a prominentpart in- the position, so far as embargos and duties are concerned.

The conditions regarding outgrowing are, also most unsatisfactory. Here again North Island merchants are drawing largo supplies from Australia and Canada, and the growing use of the motor car has also had a material effect in the lessened demand for oats. It is not so many years ago that thousands of sacks of oats used to be sent by steamer to the North Island every week, but that recognised outlet has now become to a large extent closed It really seerhs that oat growing in the South Island must bo restricted more or less to a demand which is ascertainable, to some extent, and which can be assured. Prices for oats have now become very low, and offer little encouragement to the growers to continue the industry. The rearing of sheep and cnttle_ would, it seems, be ft far more profitable work for South Island farmers.