SUGAR SHORTAGE

Otago Daily Times, Issue 27057, 16 April 1949, Page 6

SUGAR SHORTAGE

RETAILERS’ PART AWAITED PRICE REDUCTION STATEMENT BY REFINERS Special Correspondent WELLINGTON, Apl. 13. Retailers had caused the present sugar shortage by using their existing stocks of sugar while waiting an expected reduction in the price of refined sugar resulting from the exchange alteration last August, said Mr J. P. Wikiman, manager of the Colonial Sugar Refining Company, Ltd., Auckland, in a letter read to the annual meeting of the Wellington Housewives’ Association. Mr Wildman said that his company, foreseeing the increased demand, had provided for it. Pending the anticipated price reduction, however, the demand for refined sugar fell off to such an extent that the company’s stores were filled to capacity and the refinery was compelled temporarily jo reduce its rate of production. During that period the invisible stocks of sugar throughout the country were seriously reduced, and in some cases must have been nearly eliminated. When the price reduction came on November 26, there was neither the time nor the shipping capacity to rebuild these stocks throughout the country before the long Christmas and holiday break.

Unfortunately, the refinery rate of production could not be restored to a satisfactory figure for some months, Mr Wildman said. Many men left the firm's employ during the period, and it was necessary to work the normal 40-hour week without overtime. Replacing those men had caused greater difficulty to the firm. The production rate had been adversely affected periodically because of the company’s difficulty in filling its coal requirements. In spite of those difficulties, however, the company had increased its sugar delivery rate by 4000 tons from November 26 to March 31, compared with the same period last year. Had the company been able to maintain production at a reasonable rate, there would have been no question of any sugar shortage. The refinery capacity was far ahead of deliveries of any one year to date, and provided the company had continuous and adequate supplies of good quality coal, full and efficient manning and no other difficulties beyond its control, it could produce more than sufficient to meet full unrationed requirements. Mrs F. F. Gilmore, president of the Housewives’ Association, commented: “This goes to show that the exchange reduction has been the cause of the sugar shortage. The merchants have been refusing to buy large stocks of sugar for fear prices would fall. We can’t blame them for that.”