PRODUCTION BETTER AND GREATER.

Otago Witness, Issue 3823, 21 June 1927, Page 28

PRODUCTION BETTER AND GREATER.

CURTAILED EXPENDITURE CALLED FOR. CAUSE FOR CONSIDERABLE UNEASINESS. In the course of his address at the annual meeting of the Bank of New Zealand held on Friday in Wellington, Mr Richard W. Gibbs —as acting-chairman—-said: On the trend of the markets for our chief products we have. had cause for j considerable uneasiness. Dairy produce for a time showed a serious decline, though happily the latest reports register a satisfactory recovery, quotations for butter being up to 170 s per cwt., as against 174 s last year, and cheese 87s’ to 94s per cwt, as against 965. The market appears steady at about these figures, and it is refreshing to learn from a recent report of the director of the Dairy Division that there has been an increase in butter-fat production of 9.11 per cent, for nine months, to a recent date, as compared ■with the same period of the 1925-26 season. The average price for butter-fat paid by the factories for 1924-25 was 18.75 pence, against 18.61 for 1925-26. The latter, however, is not a true indication of value, as heavy reclamations have to be provided for in many instances. It is interesting to note that the 1913-1914 figure was 12 pence. While the price has advanced 50 per cent.,' the expenses have outstripped this. In other, words, the cost of produc-

tion, including interest on the higher land values at which many dairy properties have been acquired during the intervening period, leaves the position much less favourable. With the severe competition threatening this important industry, a progressive improvement in the herds, with the resultant increase in the percentage of butterfat, combined with the most up-to-date methods of treating the individual farms, would appear t o be the best way of facing the present difficulties. Dairy produce has become our leading export, and whereas in 1906 the total export of this produce was only 451,431 cwt. at 31st March, 1927. it had reached 2.753,557 cwt, the bulk of which was disposed of in Britain; showing the utmost necessity for maintaining the goodwill of al! parties connected with the trade there, always bearing in mind the important fact that we supply only about 20 per cent, of that market’s requirements. I think it will be generally conceded that, if more energy were directed into the channel of increased and better production many of our present difficulties would be met. In this direction- the valuable assistance afforded by such institutions as the Cawthron Institute, of Nelson, and, in due course by the new Council of Scientific and Industrial Research, cannot fail to show good results in the near future. The farming community throughout the world is experiencing a critical time, and little consolation is to be found by our producers in the fact that primary industries are. suffering a set-back generally, more particularly in the United States ,of America, where the farmer has found him self in~more serious trouble than his confrere in New Zealand, but there method: are being adopted to ensure more scientific farming, and the fact that along that roac

lies recovery cannot be too often stressed. The wool situation presents a somewhat brighter picture. The London March series of wool sales closed firm for all kinds of wool, with good competition from the Continental and Home .trades. Prices showed an all-round appreciation compared with values ruling at the January scries. As mentioned at our last half-yearly meeting, the first sales of the New Zealand selling season had then taken place. Competition at these sales had been good, and, as the sales progressed throughout the country, prices continued to harden, until, at the” last sale in March, values reached the highest point of the season. The London May sales opened with a slightly lower range of values, but the market firmed as the sales progressed. The more stable condition of the wool market is, no doubt, i the result of the better feeling in Britain engendered by the settlement of the long- I continued coal dispute and more favourable industrial conditions on the Continent, particularly Germany. Wool is acknowledged to be at a reasonable price, and should better trade develop, no material set-back in values is anticipated. In common with all other trades, frozen meat nad to bear its share of the depression caused by the coal dispute, and, owing to the great increase in unemployment, the demand for meat was greatly reduced. This naturally had an adverse effect upon prices. Early arrivals of ouf new season’s meat in the new year.met a good market at satisfactory prices, but with larger supplies arriving and afloat, the market appears to have settled down to a lower range of values, especially in regard to lamb. . The flocks of New Zealand were at their highest in 1918, with a total '.f 26,538,302 sheep, which graually shrunk to 22,222,259 in 1922; since which date there has been a steady increase, reaching 24,904,993 in 1926. Australia heads the list of t-.e sheep flocks of the world with (1925) ... 93,154,953 The United States have (1926) ... 41,003,000 Britain (1925) 26,221,141 (An increase of about 4,000,000 ■•i nee 1922) New Zealand (1926) 24,904,993 Frozen beef continues to have a keen competitor in the Argentine, which has secured the British Army contract for tinned beef which last year was placed in Australia. One of the largest frozen meat works in the world is in Buenos Ayres, with a capacity of 1,500,000 bullocks and 2,500,000 sheep yearly, which means a large saving ~in overhead expenses and makes competition, by smaller companies at a distance, difficult. Wheat production in New Zealand this season has been above the average, and the harvest has been gathered under ideal conditions. About 220,000 acres were under crop, the total return being estimated at approximately 7,000,000 bushels. To summarise the position of our export and import trade as at March 31:— Our exports for the financial year amounted to ... ... £45,682,000 Our imports to 48,192,000 Showing an excess of imports of £2,510,000 The previous year showed—-

A considerable shrinkage will be noticed in both sets of figures, with some improvement apparent in the net result of the March, 1927, period. Wool showed 21,695 extra bales shipped in 1926-27 ; the declared value, however, was less by £1,368,451. Butter likewise increased, in quantity by 81,706 cwt., with a decline in value of £334,990. The same position as to quantities and values is recorded in the case of most of our other exports—i.e., frozen lamb, skins, coal t etc. The shrinkage in imports is spread over a large range of goods, motors, and accessories, accounting for £1,312,975. The chief increases in- imports were:—

With a . reduction of approximately £10,000,000 in last year’s income to December 31, and with an excess of imports over exports of approximately two and ahalf millions, the necessity for curtailing expenditure is obvious, as there is a limit to the country’s resources; bub if the gravity of existing conditions is recognised by all. from the Government downwards, and a determination made to live within our means, though it may mean sacrifice, T have no fear frr the future, winch I look forward to with confidence. If we are prepared to cut down requirements which may not in any way be necessities, work as did the old pioneers who laid ths foundations of New Zealand’s nrospcrity, and introduce in every walk of life more efficiency, there will be no occasion for pessimism, and our present troubles will soon be behind us. I am aware I am but reiterating advice which has of late been most liberally given—perhaps, as I heard it remarked, ad nauseam—it. however, applies to us all, and wil) have to be heeded if serious trouble is to be averted.

Exports . £48,697,000 Imports ... 53,025,000 Excess of ijnports w.- .. £4,328,000

Flour £330,071 Hardware 391,106 Motor spirit 120,431 Phosphates 146,147 Telephones and accessories 259,819