DOMINION INDUSTRIES

Poverty Bay Herald, Volume LII, Issue 17133, 8 September 1926, Page 7

DOMINION INDUSTRIES

TOO MUCH PROTECTION? FARMERS IN DIFFICULTIES (Special to the Herald.) CHRISTCHURCH. this day. A right relationship with each other, higher efficiency and more production in industry , and cheaper money for the farmer are remedies for the present industrial position in New Zealand, according to Mr. W. Machin, president of the Canterbury Chamber of Commerce, who, at the annual meeting of the chamber, dealt with the industrial outlook, with particular reference/ to the sheltered and unsheltered trades. Mr. Machin quoted a paragraph from the letter ot the Minister of Finance, the Hon. W. Downie Stewart, recently addressed to the Industrial Association of Canterbury. The Minister said that New Zealand's export trade depended almost wholly upon the primary products, and unless caution was exercised in dealing with tariff matters we might find that in future it would be necessary to resort to all sorts of undesirable expedients to offset the. disadvantages which unduly high Customs duties imposed upon the agriculturist in his industry. In addition to that consideration it would be recognised that unreasonably high tariffs frequently produced not efficient but inefficient industries. INDUSTRIAL EQUILIBRIUM.

"Much of our trouble in New Zealand to-day." continued Mr. Machin, "is due to the fact that our industries are out of balance in their prices and their overhead charges, and until they get into harmony again we shall continue to suffer. Industrial equilibrium means harmonious relations in production and plices between the various commodities and services which contribute to the general well-being of the • Dominion. What is out of gear? I think the industries sheltered by tariffs are unconsciously doing a disservice to the unsheltered industries, and also a disservice to themselves. If they only knew it the unsheltered trades comprise mainly the agriculturists. "The farmer sells his wool and his meat and butter in unsheltered markets which have to face the unrestricted competition of the world. His sales within the, Dominion are mainly at world's parity, but many of the purchases are loaded with heavy duties to provide shelter for the sister industries within New Zealand.

"Last may New Zealand animal products stood at 43 per cent, above the five years' pre-war average. They are lower to-day, but the goods the farmer uses other than foods, clothes, boots, building materials, etc., stand at from GO par cent, to 100 per cent, above the prewar average prices. He often sells his wool at less than world's parity, and at world's parity his meat and butter to his industrial fellows within New Zealand, but what he buys is higher in proportion. RISING COSTS.

"The freezing and the freight on the Canterbury farmers'; lambs is 66 per cent, above pre-war rates, and he is menaced by much lower prices for meat. (It is only a few months since Argentine fores of beef were selling on the Smithfield market at l|d pet lb); by artificial silk (last year 60,000 tons were produced; this year the estimate is "00,000 tons, much more than the whole New Zealand wool clip). All his expenses have been rising disproportionately; even his rates for local bodv borrowings have risen from £21,000.000 in 1910 to £52,000,000 this year; his land is decreasing in value before his eyes. The cure is higher efficiency and more production everywhere.

"This remedy of bringing down costs in -the sheltered frades was dawning upon the industrial world, continued Mr. Machin. In America in 1922-1923 the disparity between the prices $i agricultural and non-agricultural products was Very great, and the situation was acute. The average prices of non-agricultural products over pre-war was 72 per cent.: the average of major food products sold by farfners was 22 per cent, above prewar, ...

"A FAIR BALANCE." The secretary to the U.S.A. Board of Agriculture wrote: "During'the next 20 years the United States will adopt consciously or unconsciously fairly definite policies as to industry and agriculture. We are approaching that period which comes in the life of every nation when we must determine whether wo shall strive for a well-rounded, self-sustaining life in which-there shall be a fair balance between industry and agriculture, or whether, as have so many nations in the past, we shall sacrifice 'our agriculture for the building of cities. "Is higher efficiency possible in New Zealand?" asked Mr. Machin, and he supplied an answer in the affirmative. "Look at our freezing industry, we have four works near Christchurch, where we had two before the war, and no mora stock is killed. We have two too many extra managements, two overheads, etc., and the same thing is going on all over New Zealand. Economy in works could save the farmer Is a head on his stock. It would benefit the whole community, for each of the works could kill for a longer period each season, and there would consequently be less labor trouble.

FLOURMILL INDUSTRY. "Look at milling. There are twice too many flour mills, so well organised that they*can provide one buyer for wheat. I saw a milling balance-sheet a few weeks ago, and the overhead was appalling. J think it gavct an item of 2s per ton for directors' fees, which would mean, apart from the management, about £14,000 a year for the whole Dominion. . . "We have got to get back to a right relationship with each other, and if we resist the results will be more painful. There are thousands of farmers struggling ineffectually to pay interest on third and fourth and sixth mortgages, which are really valueless. It is the opinion in some quarters that agricultural land is back again to 1913 values. These fictitious values will need to bo written off btffore the position is sound again. It is foolishness to continue pay. ing chaises on capital which has been lost, but the land and climate are still there, capable of being more productive than ever before. There is no royal road to .cheap money, but cheaper money is needed, and I" think we should congratulate the Bank of New Zealand upon having pointed the way. Easy morionis a curse, but I can see an immense blessing in reasonably-priced money to thousands of young, hard-working fellows who can "repay interest and prin- | cipal ovar thirty-six years by easy stages, and all the time be securing a homestead block and the right to sit under their own vine and fig' tree, unafraid in their prime and old age. "If what I have said is in any measure true, if it makes lis who dwell in the towns (and we are a number just about equal to those who live and toil in the country) more concerned for the common weal of all who dwell in this land, then with higher efficiency, more mutual consideration and some'sacrifice, I am persuaded we 'will win through one of the most difficult problems which has ever cast its shadow over this fair Dominion."