ENTERPRISE CHALLENGED

Te Awamutu Courier, Volume 58, Issue 4192, 2 June 1939, Page 7

ENTERPRISE CHALLENGED

THE EASTERN MARKETS. POTENTIAL VALUE TO DOMINION. “The Eastern markets are of potential value to New Zealand and Neiw Zealand has to go and develop them by providing her own facilities,” said Mr G. F. Allen, a marketing men who has spent some time in investigating Eastern marketing conditions, in an interview. Mr Allen is visiting Wellington. He said the few cold storage plants which operated in the East were not working to help New Zealand produce on to the market, but were there as a means of keeping it out. “We have depended on the English market to consume our produce right from the inception of our export trade,” Mr Allen said. “Now the English farmer has laid claim to his very birth-right, to the partial exclusion of our produce, some of our farmers are clamouring for State guaranteed prices for that which they think they cannot sell overseas. “In spite of the Government’s benevolent spirit it knows full well that it cannot control the marketing of our produce overseas as long as the realizable price factor is governed by the parity of an open market. It cannot reasonably guarantee a payable price to either meat, fruit or dairy producers by guessing what next year’s average realizable price might be on the London market.” “WATERED MONEY.” Mr Allen said watered money issued in New Zealand became valueless in circulation unless it was backed by overseas exports. During February this year the Minister- of Agriculture in England had announced that restrictions would be imposed on exports of New Zealand’s meat to England. About the same time the New Zealand Government had announced that there would be no restrictions on the number of killings. During the second week in March the New Zealand live stock market reported absence of export buyers. The freezing companies reported the number of killings as above normal for that time of the year, notwithstanding dry weatherconditions. With the export restrictions in full effect after next July, the trading banks would be expected to finance about 300,000 carcases of mutton on the hook. On top of that the sheepgrowers were asking, “What are we going to do with our ewe mutton?” BILL FOR THE GOVERNMENT. “Suppose we put it into the freezers, too, estimate it as 200,000 carcases, 601 b. weight each, and ask the Government to guarantee the price at 15s 71d New Zealand currency a carcase,” Mr Allen said. “Add the 300,000 carcases to be affected by the export restrictions at the same price, and let the Government pay the bill amounting to £387,521 a year. “Suppose the restrictions are still in force three years hence. What would the position be ? An accumulation of 1,500,000 carcases and £1,162,562 of watered money floating about —inflation of internal 'currency values of the very worst form. On top of that we would, still have 1,500,000 carcases on the hooks and the fourth year’s surplus piling up further problems and still no overseas outlet in sight. “We have reached the stage when we have to turn right about and focus our overseas outlook in an Eastern direction. That means Malay States, Java, Philippine Islands and China. CHINESE DO EAT MEAT. To say the Chinese are not meat eaters is definitely wrong. In Canton, before the outbreak of the Sino-Jap-anese hostilities, there was a weekly market of a special breed of dog for eating purposes. The fact that poultry and pork are mainly eaten is because they can be reared most economically almost within the precincts of human habitation. Butthat doesnt mean those, kinds of meat are marketed at a rate of 3Jd. a lb., New Zealand currency. At that price, meat would be cheap to the Chinese, and an enormous purchasing power of a new market would be opened up. It was about time, Mr Allen continued, that the primary producers of New Zealand stopped in their tracks and realized Eastern countries were not creditor countries to New Zealand, and, therefore, would not invest money in capital equipment for the purpose of housing and marketing New Zealand produce. Under ordinary conditions Australian beef, in Hong Kong, from neck to hock averaged 118 d. per lb., and mutton lOld. a lb. The average price of beef in London was sid. a lb., and for mutton 4Bd. a lb., on May 22nd, 1939. Thus the difference between London and Hong Kong prices were 6}d. and 6id. a lb. respectively. CONDENSED MILK. Dairy farmers should know that condensed milk could be made from skim milk powder and unsalted butter made in New Zealand, and by adding the sugar and water in the de-

desired percentages at Hong Kong, could, by a mechanical process, be reconstituted into condensed milk for about 8s a case less than it was imported for. “I have heard the Waikato milk powder factories were planned io have a manufacturing capacity of 12,000 tons a year, and over 18 years the annual output has averaged about 5000 tons,” Mr Allen said. “Fancy 7000 tons of unused capacity going to waste. Taking that quantity a year as representing 22J per cent, of th.e constituent parts of condensed milk, then 31,100 tons of condensed milk could be made. At 53 cases to the tin, 1,648,000 lots of 8s were lying dormant for the want of a little foresight and enterprise.” POTENTIAL RETURNS. Mr Allen illustrated his view of the potentialities of the East by quoting the following figures:— Profit on 1,648,000 cases at 8s each £659,000. Sale of 7,000 tons of skim milk powder at £49 a ton £343,000. 3375 tons of butter at £lB6 a ton £627,750. Total £1,629,750. Add 500,000 carcases of mutton at 12s 6d. each £312,500, making a total of £1,942,250. “Mr Savage says he is doing his best to solve the farmers’ problems,” Mr Allen said. “It would be better to help them to bring new and real money into the country, via the East, instead of issuing watered money for accumulations of meat, which may prove valueless in the long run. FRUIT AND POTATOES. “Hong Kong’s imports from here amount to about £22,600 a year. Just in, case the fruit-growers are interested, I may say that in Hong Kong, Granny Smith, Delicious and Jonathan apples are sold for £2 a case. Pot-ato-growers also note that there is a good market for sound South Island potatoes to sell at £ll 13s 4d a ton. Don’t send any Australian oranges as discount or expect foreign interests to provide New Zealand with cold storage. It simply isn’t done.”