THE TOBACCO INDUSTRY

Taranaki Daily News, 22 June 1931, Page 3

THE TOBACCO INDUSTRY

DEVELOPMENTS IN DOMINION RETAINING TWO MILLION POUNDS. EMPLOYMENT FOR 10,000 PEOPLE. Encouraged by the success obtained by tobacco-growers in Nelson, a group of Auckland business men and farmers about three and a-half years ago took Up the study of tobacco-growing and manufacturing in New Zealand. Experiments in tobacco culture were carried out in North Auckland, and Tauranga, with satisfactory results, the tobacco grown in these districts being pronounced by experts as infinitely superior in texture and colour to that gro\Vn in Nelson. Satisfied with these experiments, and having ascertained from official statistics that New Zealand was sending overseas some £2,000,000 per annum for tobacco, cigarettes and cigars, the bulk of which huge sum directly and indirectly was going to foreign countries, this group of enthusiasts decided to endeavour to retain in New Zealand the money spent by New Zealanders on “My Lady Nicotine.” A COMPREHENSIVE SCHEME. A definite scheme of progression was adopted —first to establish the growing of tobacco on a large scale in Auckland and Tauranga, to build up substantial stocks of unmanufactured tobacco, and then to erect and equip a modern factory for the manufacture of New Zealand tobacco and cigarettes, with 100 per cent. New Zealand capital, labour and material. With a view to establishing this industry as a national one for New Zealand it was decided to invite the public of New Zealand to become financially interested, and three tobacco-growing companies were formed by this group of men. The companies are as follows: Standard Tobacco Co., ■ Ltd., capital £55,000; Tauranga Tobacco and Citrus Co., Ltd., capital £30,000; and. United Tobacco Corporation Tauranga, Ltd., capital £125,000. Shares in these companies have been subscribed for by many thousands of people all over New Zealand, and tobacco grown by these companies during the past two seasons has been flue-cured and is now in store maturing, and is available for conversion into the manufactured article in due course.. Following the successful establishment of these tobacco-growing companies, the next step in the scheme of progression was the formation of the factory company, and Amalgamated Tobacco Manufacturers, Ltd., capital £200,000, was registered at the end of 1930 for the purpose ' of erecting a tobacco factory at Auckland for the manufacture of cigarettes, tobacco and cigars, the raw material to be supplied under contract by the tobacco-growing companies. Again, following the policy originally adopted, the public of New Zealand was invited to take up the capital in the factory company, and many thousands of these shares have been taken up by all sections of the community, emphasising the universality of the appeal. The shareholders in the factory company and the subsidiary companies, by smokinw the manufactured article and encouraging their friends to do so, will insure success for the amalgamated company and its subsidiaries. A GREAT REVENUE PRODUCER. Tobacco the world over is one,of the greatest revenue producers, and so it is in New Zealand. It is estimated that New Zealanders smoked last year about 750 million ready-made cigarettes in addition to the cigarettes made from loose tobacco, and the estimated retail value o’ New Zealand’s consumption of tobacco, cigarettes and cigars last year is £5,000,000. With such a substantial market for tobacco and cigarettes within New Zealand itself, it was thought that the flotation of a tobacco manufacturiiio- company in New Zealand and for New Zealanders would appeal to investors, small and large. With recent newspaper reports of 50 per cent, dividend paid by Carreras, Ltd., fc*_- the second year in succession, 26 per per cent, dividend by the Imperial Tobacco Company on a capital watered many times during recent years, by bonus shares out of profits, Ardath Tobacco Company’s net profits last year increased from £471,441 to £715,174 (possibly by the issue of coupons), and, from time to time, reports of the death of members of the famous Wills family leaving estates valued at many millions sterling, is it to be wondered that New Zealanders have at last decided, to call a halt on this drift of millions out of New Zealand for a commodity which can be and is being produced locally? Though the dividend appeal is great, yet a still greater appeal is the' fact that the tobacco industry in New Zealand, developed to the maximum, will permanently employ from 10,000 to 20,000 people —in the tobacco fields, in the tobacco factory, and in. the subsidiary factories' making tins, cannisters and other packing material, packing cases, wrapping paper, labels, wrappers, etc. HELPING THE COUNTRY. With some 40,000 Workers unemployed and many thousands of primary and secondary schoolboys and girls leaving school each year, it is obvious that employment must be found for this increasing army of people, or those, persons with a stake in .the Dominion—property, investments, businesses —will undoubtedly be called on to foot the bill to keep these people in food and clothing. The directors of the amalgamated and its subsidiary companies, backed by financial support from the public, are sincerely endeavouring to find employment for a large number of people by developing the tobacco industry in New Zealand 0 to the maximum. The great sura of £2,000,000 per annum retained in New Zealand instead of being sent overseas for tobacco would provide £lOO per annum each for 20,000 girls and youths or £l5O per annum each for 15,000 men. . Work in the tobacco fields is light and healthy, and employment can be found for women, girls, youths and men not physically fit to do hard manual labour. . The directors of "Amalgamated” and its subsidiary companies in their scheme of development will be able to place a large number of these people on the land and in the factory during the next two years. CANADA’S EXAMPLE. When it is remembered that Canada in eight years—l 922 to 1930 —so developed her tobacco industry that she now orows all the tobacco she manufacturefir and at the same time has built up an export market which in 1928 reached 6,079,6061 b., it must be apparent that New Zealand can do the same. The United Kingdom encourages by preferential tariff the export of Empire-o-rown tobacco to Great Britain. ° A feature about tobacco-growing in New Zealand is that high grade of leaf can be grown on poor soil which at present is merely growing ferp and

scrub, and it is estimated that a further. 10,000 acres of tobacco would need, to'be cultivated each year to capo with New Zealand’s existing domestic demand. In addition to the markets available by export to Great Britain, reports from Australia state that the crop there is a small one owing to soil and climatic conditions, and a substantial export market should be available for New Zealand tobacco in Australia, LOCAL ARTICLE POPULAR. New Zealanders have for many years smoked New Zealand-grown tobacco, and the demand is substantially increasing. Samples of New Zealand-grown tobacco were sent to England last year for examination by a well-known tobacco manufacturing company, and the report received confirmed the opinion held locally that New Zealand was producing tobacco of a very high grade, and experiments carried out each year suggest that there is no reason why New Zealand should not produce tobacco equal to the world’s best Virginian. The Parliamentary Tobacco Commission last year recommended the setting up of a special tobacco branch of the Department of Agriculture and the carrying out of experiments to improve the present high standard. New Zealand has a protective tariff of 3s per lb. on importations of unmanufactured tobacco and protective tariffs on imported manufactured tobacco and cigarettes, and this lias encouraged the development of the tobacco industry locally and many thousands of the public of New Zealand have responded to the appeal to invest theii* money in a national New Zealand industry—for dividends, to assist employment, and to keep the money in New Zealand. Control of Amalgamated Tobacco Manufacturers, Ltd.,, activities is in the hands of the following directors: Messrs. K. A, Snedden, solicitor, Auckland; G. H. Saunders, company director, New Plymouth; James Boddie, chairman of directors, Farmers’ Trading Co., Ltd., Auckland; H. A. Robertson, chairman Waitemata Power Board, Auckland; P. W. Lamb, company manager, Hawera; P. G. Easson, company director, Auckland; and R. H. Montgomery, manager of Walter Buchanan, Ltd., Auckland; As a number of these gentlemen have had considerable experience in the development of the tobacco industry in New Zealand, the addition of an overseas tobacco manufacturing expert to take charge of the manufacture, should ensure that the growing, manufacture and marketing of the tobacco in New Zealand will be efficiently controlled. While the habit-of smoking by women, girls, and youths in New Zealand may be deplored by a section of the community, the shareholders in Amalgamated ' and its subsidiary companies have adopted this slogan, “If you must smoke, smoke New Zealand; tobacco.” (Published by Arrangement.)