THE BREADSTUFFS AND PRODUCE MARKETS.

Otago Witness, Issue 2803, 4 December 1907, Page 22

THE BREADSTUFFS AND PRODUCE MARKETS.

T . Friday. Latest London advices available at time of writing report the wheat market quiet and fairly steady, with nothing doing in cargoes, and the American financial situation 6till causing nervousness. With the gradual improvement which may now be expected in the financial situation in London and elsewhere, there should be a firmer tone in the wheat markets of the world, for as soon as business in America becomes at all normal a sharp advance in the American wheat markets may be looked for. The reason for this assumption will be seen in the folowing summary of the wheat situation compiled by '" Beerbohm " under date London, October 18: Th« market tins -week has suffered •from what Bomo of those engaged in the trade term a " tired " feeling. Prices have now leached a level whiah we consider was justified by the conditions of prospective supply and demand, and the attractive influence of a 40s level of price has resulted in large ship- | merits from Russia, as well as from America; j

this had led many to suspect that there is more surplus wheat in both these ountries than we had given credit for. This by no means follows, rather might it be said "that the wheat is coming forward earlier than it otherwise would have done because of the attractive prices. Meanwhile there is, no doubt, a disposition upon the part of buyers io await developments, especially in connection with the Argentina and Australasian crops, and, as is also natural, at the first sign of weakness resellers are anxious to secure profits. We should, however, not be surprised to see the market make a sharp recovery, because the more we learn of the American and Canadian spring wheat crops the more certain does it appear that America's surplus- lies in its ■winter wheat crop alone : and this must soon come to an end at the recent rate of exports. Thus there may be nothing extreme in the remark by an American correspondent that American exporters may wake up one fine day to discover that they have over-exported. Circumstances seem to be combining to make wheat dear this season; the European crof>, as we now know, is about 3-1 million quarters leas than last year, and the AmericanCanadian crops about 18 million quarters less than last year. To add to this we now have to meet the probability of a crop failure in Australasia and a possible great scarcity of native food crops m India. The weak sjjot seems to us to be America., not because

, of any large existing surplus, but because of the dearness of money and the demoralised condition of the money market there. That there is no -change from the previous strong position in regard to future supply and demand may be 'seen from the present indications of the world's production this year, compared with the five previous years. At the end of July our forecast was for a total of 368 750.000qr5 ; now, with the official estimates from Russia, Roumania, France, and America at hand, we find the total Teduced to 383,850 ) 000o.T8, and the comparison with previous years as follows — The Woeijj's Wheat Crop. Quarters. 1907 883 850.000 1906 441.580 000 1905 422,645,000 1904 .. .. „ 401.860.000 1903 411,645.000 1902 399,400,000 Wo may explain that in this year's total we have estimated the coming Argentina crop at 5 per cent, above last year's, and the Australasian crop at 25 per cent, less than last year. It is now possible to ascertain with some degree of accuracy the trend and position of the Commonwealth markets. Latest advices convey the intelligence that an cxi portable surplus is practically assured, \ although authorities differ as to the ' extent of that surplus, some placing it as : high as 22,000.000 bushels and others as 1 low ac 10,000,000 bushels, as against i 40,000,000 bushels of a surplus last season. } Thrs the high level of prices reached ju*t . before the break-up of the drought, and justified in the assumption that Australia would require to import wheat for her . home requirements, will not again be touched, except upon the basis of London parity. This means that all through, the season prices in Melbourne, Sydney, and Adelaide will be regulated by the London market. Recent Adelaide advice gives the Register's estimate of the South Australian wheat harvest at 17,112,000 bushels, with an average yield of 9.25 .bushels to the acre, compared with the Advertiser's estimate of a month ago of 14,500,000 bushels, an average of 7.91 bushels to the acre. Allowing a carry-over of about 2,000,000 bushels and deducting 4,000.000 bushels for i food and seed, this arives South Australia ! an exportable surplus of 15,000,000 bushels, as against 22.000.000 bushels last season. No reliable estimate is vet forthcoming of either the Victorian or the New South Wales harvest, but it is assumed that "Victoria will fully provide for her home consumption of 8.000.000 bushels and probably have something to spare. Whether New South Wales will be able to provide for her needs for food and seed— about 9,000.000 bushels — is an open question at present. In j all probability she may have to import from other States, though to what extent it is impossible to say. On the other hand, the rain has improved the prospects for the Queensland harvest, and that State will not require co large an import as was. at one time estimated. Tasmania should be able to provide for her own needs, while Western Australia — a fairly heavy importer in past years — will have a small surplus for exrort. Thus the question whether Australia's exportable surplus will be 10,000.000 or 22,000.000 bushels depends almost entirely upon the New South Wales yield. This week's Commonwealth quotations ayr about thp sam» level as last week, all hough a slight firming tendency would sp/^« +o indicate that the bottom of the market has been reached. Sydney quotes milling wheat at 4s lOd. and Melbourne at 4s 9d. The Adelaide quotation of 4e 4d must, be regarded as purely nominal, as it is impossible to purchase wheat within 5d to od per bushel of that price for immediate delivery. Possibly a little forward business in new wheat might be done at the figure mentioned. Under date 23rd inst. the Australasian remarks : — The demand from millers has become inactive s>ince the beginning of the coal strike, a<= it is feared that it may become necepsary to close some of the mills. There 'ha» been little or no inquiry from other buyers, as local prices are too high for shipment, either to England or other destinations. Supplies have been offering from the country a little more freely, especially since the Tainfall at the end of last week, and altogether the market has shown a droomner tendency. The closing quotation is 4s Bd. There have been inquiries from the country with regard to ■ipUinp new wheat, and a small business has been done at irregular prices. The following from the Town and Country Journal, dated 20th inst., is of interest, as showing the divergence in idea entertained by those interested in the cereal : — j ( ; During the past week several offers have been telegraphed from Adelaide to Sydney to ship old South Australian wheat at a Sydney landing cost of 4s lOd a bushel. These offers may have to be withdrawn through the . coal strike interfering with steam traffic to and from South Australian ports, including Port Adelaide, Port Pirie, and Port Broughton; but, in the meantime, these offers have had a practical effect on Sydney values, for sales took place (forward), at the close of last week, of New South Wales new wheat at 4s lOd to 4s 9d a bushel (Sydney). It was stipulated in every case that the grain was to be prime, of f.a.q. standard. ' It is to be regretted that trade circular* ' have been sent from Sydney to a number of farmers, advising them to hold tenaciously for aCs market. Such a forecast is designed to capture a phare of the farmers' business, but is not a legitimate method of so doing. Xo agenta in Sydney or elsewhere can pcsibly predict with certainty that New South Wales wheat will touch 6s this summer, and it is quite possible that the farmers, being thus buoyed up with false hopes, may hold on till they miss a good market. Such a | disappointment hoa happened over and over again to the farmers here in pa&t year*. They are optimistic enough, without being misled by extravagant tales from the city. Also, many farmers have made up their minds that the Wheat campaign will open at 5s a bushel (Sydney). It is for the grower to listen to all the arguments pro and con, and then to form a conclusion on his own ' judgment. Naturally, he would like to get top price and this without even having to pay for any expense 3, such as stacking at his country railway station. At the same time 4g 9d to 4s lOd (Sydney) is an excellent cash return, and its immediate acceptance for December-January delivery would relieve him of all anxiety, and of " holding expense's," besides making a, good profit a. cer- ' tainty. It should ba borne m mind that the Jast two ramfal's altered the whole complexion of the wheat crop prospects for the better in New South Wale*, Victoria, and South Australia; while West Australia, , which is already a considerable exporter, will reap her record harvest. Even the Darling Downs (Queensland) should now harvest from 10 to 13 bushel*- an acre, and Tasmania will gamer enough wheat to provide her with seed and bread ior the y«ar l&OS. Thus it

.L.ay be inferred that Victoria, South Aus> trali*, and West Australia will this rammes have between them an exportable surplus of 22 million bushels over and above seed ancl bread requirement*. Show week is usually & alack time in the local wheat market, consequently no business can be reported Recent inquiries, however, go to prove the extreme scarcity of the holdings of wheat outside millers' hande. Indeed, it would be difficult to purchase 10,000 sacks at any price, and a buyer going into the market at the present time would be able to secure very little good quality grain at under 6s per bushel. There are still three months to go before new wheat in any appreciable quantity will bo on the market, besides the fact that old wheat is always in good demand during" the Jirst few months of the season for mixing purposes. The situation is intensified by the fact that the recent drop in the price of flour will, diminish the importations of Australian flour. There is, there* fore, no likelihood of the New Zealand wheat market dropping to Australian level, which makes the position difficult for millers who have not sufficient grain in stock to carry them on to the end of the season. In the absence of business quotations nominally range Jfrom 5s 10id to 6a on trucks for mixed milling lines, a few 1 lots of old wheat in indifferent order offer* " ins at less money. There is very little demand for fowl wheat owing to the high price, while the supply is also limited. It may be quoted nominally at from 5s 8d to 5s lOd, ex store, according to quality. There is no further change in the price . of flour, and no additional drop is anticipated. The demand is slack, ar-Vthe tariff remains as follows: Sacks, £12 15e; 100's, £13 se; 50's, £13 10s; 25's, £13 15s. The shipping price is now £12 10s, and the Invercargil price £13. The tariff for offal is unaltered as follows:—Bran, £4 15s locally and £♦ 10s for shipment; pollard, £5 10s both for local orders and shipment. The oat market is quiet, with a weakening tendency, owing to the absence of inquiry in the North Island and a weakening in the Melbourne market. Dunedin merchants, who hold the bulk of available stocks, have been endeavouring to keep the market up to the level of 4s f.o.b, b.L, but this is provins impracticable. Holders are now inclined to "meet the market with & view of unloading, especially in view of the abundance of green and other feed, and the prospects of an early and abundant harvest. The current quotation is from 3s 10£ dto 3s lid f.0.b., s.i., while less money would be accepted for a decent line. For local orders good feed oats are offering at 3s 8d to 3s 9d, ex 6toTe, agents being anxious to clear stocks to make roomfor the wool now comipg in. Oatmeal is unchanged at £18 per ton, and pearl barley is quoted at the same prioe. The supply of potatoes is still in excess of the demand, and all hope of any recovery in price lias praoticailv been abandoned. Supplies of new potatoes, are coming in fairly freely from the Peninsula, while consignments from Oamaru may be _ expected in about three weeks' time,- as well as shipments from Australia. The - Auckland market is overstocked and all lines of old potatoes now require careful picking over. Consequently the only demand is for really prime picked samples and for these up to £2 per ton can be obtained for white sorts, and up to £2 10s for Derwents. New potatoes are quoted: Peninsula, small 2d, choice 2Jd to 3d per lb: Melbournes, £7 per ton. There is no change m the dairy produce market, nnd quotations are as f oUow:r: Butter: First grade factory— Prints, 11*J bonked, Hid cash ; bulk, lid cash. Dairy. 6id to 7id; milled, Bid to 9d; separator, Bid to 9id. Cheese: Factory mediums, 61d to 64d per lb; Akaroa loaf, 6*d per lb; niobiums, 6d. »«, j E^gs are in good supply at lOd per dozen. Poultry.— Plentiful. He^e. 2s to % ;*» pair; roosters, 4s to ss; ducks, 4s to b§; turkeys — hens 6d, gobblers 80. Pirns.— Baconers and porkers continue scarce at 5Jd; bacon, Bjd; bams, 9d to 93 d The chaff market is fairly supplied. Prime oaten sheaf is quoted at from £6 to £6 7s 6d per ton. "*