WHEAT.

Timaru Herald, Volume XC, Issue 13300, 31 May 1907, Page 5

WHEAT.

timaru brokers on the posi- ■ ."'/ Tion. The wheat market still remains very firm throughout Australasia, England and America, and some inquiries were made by a " Herald" .reporter -lUt-h -a view to ascutaining the condition >.f the marktt as viewed from ;th.e grain "dealers' standpoint, and to gain some idea of the future conditions as far as could ba judged from present indications. ■

The head of one firm which does a. largo grain business, when approached on the subject, said that the market was in sucha state of excitement and absolute chaos, that he hardly knew what to think, albout. it. He was confident that the former state of things would be re-established by a sudden sharp fall in prices, but until that occurred he did not know what: would eventuate. The condition of the grain market at' present, was wholly contingent upon: th-a Home market; prices here were ruled by the transactions of the Australian merchants, whose movements were in turn directly governed by. the Home buyers. He was* assured that there was a considerable amount of wheat still 'the. hands of far-, mers, who were able to hold their stocks, so that there, was--as yet no absolute scarcity of .supplies. New Zealand had at present no market to which'she could export, any surplus, and as far as he could learn, the, millers had sufficient stocks to carry them through to the end of the year. Those who v.-ere somewhat short were most anxious to buy. As regards his own. firm, they were paying prices up to the full present value • on all lines' purchased by them.. From a holder's viewpoint, he was inclined to think that the wise men at present were those who were satisfied to regard 4s to 4s Id as a good price, and were selling at that figure, preferring to let'.some one elso 'take the risk of holding foi: a further rise and meeting a slump. There was as yet hardly sufficient, to justify anyone holding on to his grain till the market reached'4s 6d, but he "thought that such a,price' was not- altogether an improbability. He understood that the millers.were informing intending sellers that they couhl not pay the present price p=r bushel, until the price of flour was rai-ied to £l2 per ton. As flour was at present quoted at £lO per ton, four rises of * I,os per ton. would be necereary before the'millers could buy. wheat at, the ruling quotations. A letter was published in the "Herald" a few days ago.in which the writer "ci'rew comparisons between the present prices of flour in Australia and New Zealand compared with the prices of wheat in the two countries, and endeavoured to explain the higher price of New Zealand fiour hi proportion to the price of wheat as compared with Australian pricey, by some form of ring-or trust. The writer, had, howevei', lost- sightr of ftie fact that, in addition to dearer labour in New Zealand, local .wheat lost- a great deal during the milling process from loss, of moisture, while the bran was also heavier than that from Australian flour.- He quite agreed with the argument in an article in a recent issue of the " Otago Daily Times," that the record shipment of 224,000 bushels of wheat made from Adelaide on May 20th ,to Yokohama and Hong Kong, furnished "first hand proof that one of the most potent factors in the wheat situation is the growing demand for wheat- and flour from the Far East, and that .-the improved dietary scale adopted by the millions of China- and Japan promises to 'introduce altogether a new feature in calculating the world's wheat consumption."' If such shipments as this one became frequent, it. would be a matter which would require to be taken into account. It was, liowe.ver, probably only a spasmodic action on the partof some Adelaide shipper. In lifer opinion, -a following up of thisi shipment would be a good'thing, as it would niena the opening up of a new outlet lor New Zealand wheat and flour. Another item mentioned' by the " Otago Dailv Times," that since the famine in Russia had not been relieved, thai* country would be transformed from one of the largest wheat, exporting countries into a possible importing country, would prove a. great factor in the wheat- market. 'Should the shipments of wheat- from Russia into Britain fall off to any extent; it would mean a- shortage there, and a consequent firming of the market, which would in turn influence the Australian and' New Zealand markets.

A busine;-vm:ui v >'^ lo i s almost wholly a. grain dealer, said that there wore as yet no indications of any easing of the market. On Tuesday ho 'himself had sold a considerable qnautitv of'wheat at 4s 6d per bushel, ex store, sacks 7d. There was plenty of wheat in JSew Zealand, but it was held by speculator.;. It was hard to say whether, there would be a. further rise, though hj? was inclined to think Uiere would be. The local markets were ruled by London, and any change there would ba followed immediately by a proportionate change hew. Judging from a -reporttha;t one of tha southern mills had .sold up to 7000 sacks., he thought thoy must bo well, Notwithstanding' reports that further rises would follow, there might be, a slump at any time. It seemed to him that the price must, bo very near the. 'iop now, /and though it was very difficult to decide what course to adopt, he would sell any stocks he had now. It was well known that in former years stock-holders who had refeed ss' per bushel, were glad to accept 2ti 6d, a few days later. At present buyers were buying " ex: store" only, and no business was being .done in lines "at country stations." There was any amount of wheat in the country—he knew'himself of at least half-a-dozen farmers' who were holding 2000 sacks each. If the stocks were all available there would be no shortage, but

if holders refused 'to sell, there would ba a! scarcity. An adverse report', from America would almost, eert.iiii'y cause a slum]).

Thq head of the.grain department of another largo linn, reported increased firmness in the wheat, marki*. A line of prime wheat found it purchaser mi Tuesday at 4s 2d. ex store. The price had now exceeded the London quotations,, and a further rise seemed probable. The. latest advices from London reported rales of Australian wheat at 36s pur quarter, or 4s 6d per bushel, which Mas equally to 3si'6d locally, allowing the -usual freight of Is. There was barely enough wheat in the" colony now to meet local requirement.?', and plenty of inquiries were being received from intending purdia.sers. There was evidently uomevhing more, behind the American market than was- apparent since.''''the September crops which were still standing were being bought up at 4s 6d per bushel. Another grain merchant said that the market was in such a condition that he could not venture any opinion. He knew rothing about the causes 'to which the present condition .of the market was due.

, Per Press Association

GHRISTCHURCH, May 30.

Wheat is now up to 4s 6d, and an increase of £1 per ton for flour was made to-day, bringing the price to £ll. „ The bakers state that the price for bread will in consequence have to be advanced another per 41b loaf, making the price 7d.

DUNEDIN, May 30.

This morning, in the* absence of further news from London, the local wheat marketwas somewhat calmer in tone, but-prices were as firmi as ever. An offer of 4s 6d f.0.b., s.i., from an Auckland buy er, was refused by a Dunedin holder for a considerable line of wheat., and inquiries by wire in all the markets of North Otago and Canterbury elicited the fact that very few holders were willing to put a price on their grain, preferring to await market developments. For the few lots' on offer 4s 6d on trucks was asked, and sales are reported at this figure. This afternoon the excitement recommenced upon receipt of instructions from Christchurch, the- headquarters of the New Zealand Flourmillers' Association, to make a further advance of £1 per ton in the price of flour, this representing a total advance of £2 ICs per ton within a little over a fortnight. Tha equivalent advance in wheat for the same period is Is per bushel (from 3s 6d on trucks to 4s 6d). Local millers were taken by surprise by to-day's advance in flour, but they point out that it amounts to a measure of self-defence. Already millers who do not hold wheat are declining orders. The local branch of the Association has received offieial notification ■ from at least two flour-milling firms of their intention to close down for the present, and;.it js fully expected that several other mills will follow suit dining the next few days. This latest rise in flour must carry with it another .rise in .'.bread, and in all probability bakers will fix the price at 7d the 41b loaf. '