DROP IN TRADE.

Star (Christchurch), Volume XLIV, Issue 233, 1 October 1931, Page 5

DROP IN TRADE.

Shipping Services Have Heavy Losses. FOREIGN COMPETITION. (Special to the “ Star.”) WELLINGTON, October 1. In the course of his address on behalf of the shipping companies in the Arbitration Court during the hearing of an application by the Cooks and Stewards’ Union for a new award, Mr W. G. Smith, of the Union Steam Ship Company, made some comments on the condition of New Zealand shipping and how it was affected by the depression and competition from other countries. He said that events had moved very rapidly during the last few months. “ The disastrous fall in export prices,” he said, “ has not only brought the farmers to the verge of ruin, but its reflex action and the large reduction in the national income have seriously affected all other businesses, with the result that their working expenses must be reduced if they are' to carry on under present conditions of trade. Not only should the wage scale and overtime rates be revised, but material alterations should be made in the working conditions, which in their present form impose heavy expenses upon the shipowner in matters in which his competitors —particularly in the transpacific trade—have no expenses at all. “ Severely Handicapped."

“ New Zealand shipowners are now severely handicapped by competition from American, Canadian, Danish, Swedish, Japanese and other foreign ships in the trans-Pacific trade, who pay very much lower wages than are paid in New Zealand, and their working conditions are such that very little, if any, overtime is paid, and their manning scales are less. In addition, the American ships receive a subsidy varying from 1.50 dollars to 12 dollars per mile, according to size and speed. In addition to this the American Government advances to shipowners, at varying rates of interest, the maximum being per cent, 75 per cent of the total cost of building the ships for foreign trade. The Japanese ships engaged in foreign trade are also heavily subsidised. “ This competition has been recently accentuated owing to some of these ships taking cargo from New Zealand to Australia, and vice versa, and as some of them have accommodation for passengers they will be trying to secure some of this traffic as well, and as a matter of fact the Swedish ship Mirrabooka recently carried twenty-three passengers on the Pacific run, who ordinarily would have travelled on the company’s mail boat. The Matson Line has now commenced a service from San Francisco to Auckland, and in addition to taking passengers from and to Ameria, is also carrying passengers between Fiji, Auckland and Sydney, and vice versa. The ships from Japan used to

discharge their New Zealand cargo in Australia, transhipping some to Union Compr ay’s steamers, so we have now lost thic transhipment business. Passenger Traffic. “ The American and Canadian cargo ships until recently ran separate services to Australia and New Zealand, but owing to the falling off in trade, the services are now’ combined, the ships calling first at New’ Zealand ports before proceeding to Australia, and there is a risk of their competing in the inter-colonial trade from New Zealand to Australia. “ Owing to the slackness of trade, the Union Company had, for the first time in its history, to reduce the New Zealand and Sydney passenger service to one inter-colonial steamer for five months of the past year, and has reluctantly been compelled to do this again this year, the falling off in passenger traffic being very heavy. The Melbourne steamer Maheno has also had to be withdrawn owing to the heavy loss in that trade. The week-end excursions to the Marlborough Sounds by the Tamahine have also had to be abandoned this year owing to the lack of bookings. “ In addition to this, the falling off in cargo has been extensive, due to the financial state of affairs in Australia, the rate of exchange, and the tariff walls which have of late years been raised to absurd heights, not only by the United States of America, but even by sister Dominions, viz., Canada and Australia. This has resulted in the lay-ing-up of a number of the company’s steamers, necessitating the services of a number of officers being dispensed w’ith, and commanders having to step back to mates, and chief engineers to junior rank. A number of seamen, stewards, and cooks are consequently out of employment. “ One of the best illustrations of the slackness of trade is the laid-up tonnage, and in the British Empire there has been an increase of three hundred per cent in the laid-up tonnage during the past year, the British total on July 1, 1931, being 2,044,092 tons net, representing nearly 3,250,000 tons gross, or about four and three-quarter million tons dead-weight.”