PRICES OF CEMENT

Taranaki Daily News, 25 September 1930, Page 16

PRICES OF CEMENT

ARE THEY JUSTIFIED? ■ MINISTER SAYS “YES.” Replying to the Dominion Executive of the New Zealand Farmers’ Union the Minister of Industries and Commerce states that it is not considered necessary at this juncture to make a special investigation to determine if present cement prices are justified. In x the course of his reply the Minister said: — “There are three companies manufacturing cement in the Dominion; these local companies supply 99 per cent, of the Dominion’s requirements. ‘Trices for cement reached peak level during the latter part Of 1920 and early 1921. Since then periodical reductions in prices have been made by the companies. The percentages of reductions in prices between peak level and present day are as follows: Auckland 46, Wellington 45, Dunedin 28. The New. Zealand companies’ prices are competitive with cost of landing content from England. “Transport costs are an important factor in the ultimate price of cement to the consumers. Cement packed in paper bags is quoted at relatively low prices 1.0. b. London. The charges incidental to importing increase the cost landed in New Zealand from 139 to tipwards of 2l)0 per cent., according to the f.o.b. i price? The paper bags do not carry well, and there is always the possibility of serious loss tvitli cement in these packages. Importing cement in casks cannot be done competitively with the local product. “The New Zealand cement concerns are public companies, and the annual statements of accounts are published. The value of the land, buildings, plant, and machinery of the three companies amounts to £712,129. The local companies produce al’cement of satisfactory quality. A considerable amount of development work was necessary before receiving returns, research work by qualified chemists is undertaken, supplies are sufficient and distribution is well organised. When perusing the accounts of Hie companies it should be noted that a sum of upwards of £13,700 on the revenue side is received from investments, and in computing the net return on the manufacture and; sale of cement this amount should be deducted. Whilst one of i e companies is iira strong financial position, it is not considered that the net return per' ton on cement is excessi\ e. “Taking into consideration the foregoing and certain other information of a confidential nature, I am of the opinion that the New Zealand companies’ prices for cement at the present time are not unreasonable.”