FROZEN MEAT EXPORT

Otago Daily Times, Issue 22653, 19 August 1935, Page 10

FROZEN MEAT EXPORT

THE LONDON NEGOTIATIONS MUTTON AND LAMB ALLOCATIONS 3.900.000 CWT FOR 1936 BEEF POSITION SATISFACTORY (Per United Press Association) WELLINGTON, August 18. The Minister of Finance, Mr J. 6. Coates, looking fit and well, returned to Wellington by the Maunganui to night. The vessel arrived in port about 6.30. The official party, led by the Acting Prime Minister, Sir Alfred Ransom, and including members of Mr Coates’s family, met the vessel off Point Halswell in the Janie Seddon. A fresh wind was blowing, but all the members of the party negotiated the climb up the ship’s side successfully. Mr Coates met them at the head of the gangly. LONDON NEGOTIATIONS In an interview on the way to the wharf, Mr Coates referred to the meat negotiations, stating that the main pur-

pose of his going to London was to discuss the immediate and longer-term policy in connection with Great Britain’s agricultural imports, and especially in connection with meat. In the period of weeks (months as between the United Kingdom and Australia) when the discussions proceeded many proposals, counter-proposals and amendments were considered. To these it was not possible to refer for, they were necessarily confidential, but the end achieved was what could be reported. MUTTON AND LAMB Mutton and lamb, New Zealand’s principal meat export, were to have been subject to a levy, and exemption from any levy had been- attained. “ One does not need to reiterate the plain fact of New Zealand’s dependence for her whole economic welfare on the export of farm produce,” said the Minister, “nor the fact of our reliance almost wholly on the United Kingdom market. A single comparison can be given in the percentages of the country’s total export values that are represented by (a) beef and (b) mutton and lamb. The percentage of the total export values of (a) beef and (b) ’mutton and lamb for New Zealand was 2.4 per cent, and 19.8 per cent, respectively, and for Australia 1.4 per cent, and 1.9 per cent. “Briefly, the position prior to 1935 and since the Ottawa Agreement was that mutton and lamb were satisfactory They were under an effective supply regulation, with foreign supplies to the United Kingdom held at a figure 35 per cent, below the Ottawa year (July, 1931, to June, 1932), and with quarterly allocations to the southern dominions. It was less satisfactory that we were working on a hand-to-mouth basis, not knowing far enough in advance what our own and our main competitors’ allocations would be, and it was most desirable that we should have a longer-term supply plan under which we could work. But the situation held a greater menace than the unsatisfactory shortness of the term for. which the mutton and lamb allocations were being made known for a number of reasons (not all of them connected with meat). The United Kingdom was showing signs of abandoning the policy of quantitative regulation. Instead a policy of levies on imports of farm produce was being more and more favoured. In other words the, tax on foreign and also, though at a lower rate of tax, on Dominion produce was to be imposed. This was to provide a fund from which to subsidise the farmers in the United Kingdom.

“Such, in substance, was the basis of the White Paper on meat in March, 1935. The effect of the United Kingdom’s proposals would have been to place a burden on New Zealand producers of £830,000 per annum. To preserve and to extend in time £he system of supply regulation on the basis already established for mutton and lamb, to avoid a levy on our produce, to get Australia’s otherwise uncertain mutton and lamb supplies controlled within a known figure—these were our main purpose. “ In beef also we should hope to get away from the hand-to-mouth quarterly quantities, and as far as possible to secure the right to switch over from frozen to chilled instead of being allowed only small experimental shipments of chilled beef. PORK EXPORTS “ Pork, including baconers for curing in the United Kingdom, was a product to which we attached very special importance, and it received a long and close discussion with the United Kingdom Ministers and officials. For the present and for the near future the outlook is, on the whole, quite satisfactory. It is true that the bacon position in the United Kingdom has been causng some concern there from the viewpoint that prices have been unduly high by comparison with the low level ruling before action was taken following upon the United Kingdom bacon commission of inquiry. Even now, however, prices are not as high as in 1920. The United Kingdom Government lias indicated that It favours allowing an increase of bacon imports, so that the cut imposed on Danish imports will not be so severe as it has been. One purpose it has in mind is that the prices would be somewhat reduced. The prospect, there fore, is that for all bacon and baconer pigs the prices in the United Kingdom may be slightly less than they have recently been. “ It is true, also, that for porkers from New Zealand and other overseas countries the United Kingdom market is. and will continue to be. regulated, but in the volume that can be taken from New Zealand baconers will not at present be reduced below what we esti mate we will be able to supply to the end of 1936. From this it will be seen

that the problem that may engage the attention of farmers is that of turning their attention to producing more baconers and fewer porkers, and solving the problem of converting the surplus porkers into baconers. As one aspect of this we have been making an inquiry into recent developments in pig feeding, and suggestions will shortly reach New Zealand as to the methods of economic feeding which we hope will be helpful.

“ Looking further ahead, and much as we might wish it - otherwise, the policy of facing a regulated market, or in its place a tariff on all pork products, baconers as well as porkers, cannot be ignored. Supplies can expand very rapidly, and while expansion from New Zealand can be expected it has beep made clear that on present indications the rate of expansion shown may lead to negotiations of quantities and may severely disturb the market. We are entitled to emphasise, and have emphasised, that foreign bacon supplies today account for a large proportion of the imports, and on this score we can, I believe, look for a satisfactory increase to ourselves, but the limits of the United Kingdom market in absorbing increases at reasonable prices must always be kept in mind.

“Mutton and lamb are New Zealand’s principal meat export, and it is most gratifying to have attained (1) the exemption of these from any levy. Almost certainly the whole burden of the levy would fall on the overseas producers. At id per lb this would have meant for New Zealand a burden of £813,000, for Australia £380,000, and for the Argentine £215,000 at the same rate, or £430,000 at the double rate of Id per lb, and (2) a satisfactory plan of supply regulation up to the beginning of 1937.

“We know where we stand for 18 months, and, no less important, we know where other supply countries, Empire and foreign, stand. For the six months to the end of 1935 the mutton and lamb allocations to Australia and New Zealand are 950,000 cwt and 1,578,000 cwt respectively. For the year 1930 the agreed quantities are: Australia 1,750,000 cwt . and New Zealand 3,900,000 cwt. Either country, if short on its 1935 second half year, may add the deficiency up to 50,000 cwt to its 1936 total. New Zealand’s figures are satisfactory. The year’s total is equal to our peak year (1932), or above that peak if we count the extra 50,000 cwt that we may send. The total is 350,000 cwt (or 400,000 cwt on the larger figure) above our 1934 total.” THE BEEF POSITION Coming to beef, Mr Coates said: “ The information that may be published regarding beef is limited to the fact that the quantities have been agreed upon to the end of 1935. These are adequate for us. We are in a fair way towards getting the right to absolute freedom in changing over from frozen to chilled. For the rest, as the result of the prolonged negotiation, and subject only' to points of detail, New Zealand has reached an agreement with, the United Kingdom covering a long-term policy. It remains to be seen how far other Governments that have been parties to the discussions will also find the draft agreements acceptable, and it is this incompleteness in the negotiations that makes disclosures in detail by us impossible. To date New Zealand has been granted satisfactory quantities for porkers and baconers, and this position remains. For the half year July-Decem-her, 1935, we arranged for quantities for porkers of 140,300 cwt and for baconer pigs our estimate of _ probable shipments has been accepted without reduction. In November, 1935, the United Kingdom Government is free in terms of the Ottawa agreements either (1) to impose a duty on Empire dairy produce or (2) to introduce quantitative regulation (for three years since 1932 neither of these could be done without our agreeing to waive our Ottawa rights). In the first case a margin of 15a per cwt (15 per cent, on cheese) must be maintained during the period of the Ottawa agreements in our favour. It happens that the agreements with Denmark and other European countries, the»“black pacts” which are current until the end of 1936, prevent the United Kingdom from increasing the duty on their butter above 15s per cwt, hence ours must remain free till then. In the absence of an agreement by foreign countries to waive the 15s maximum, the intentions of the United Kingdom Government, which, on present showing, will involve a levy on all produce, Empire included, rather than a supply regulation, have been indicated to us generally, and a letter from the Dominions Secretary makes a formal record of the matter. Our request has been before so important a matter is decided upon it should be the subject of a consultation to which we are a party. The United Kingdom Ministers, the Prime Minister and the Dominions Secretary on July 17, 1935, and the Minister of Agriculture on July 18, 1935, agreed to this. Australia and New Zealand through their producers’ boards agreed on the respective aggregate supplies of fresh fruit to be exported to the United Kingdom. As a sequel to this it remained to ensure that the market would not be spoiled and the Australian-New Zealand agreement undone in its effects by the unlimited flood of foreign imports. That this should be attended to was the substance of our 1935 requests to the British Government.”

A fair crowd had assembled at the entrance to the Taranaki street wharf, and Mr Coates received a cheer when he left the vessel.