THE BEEF SLUMP.

Waipa Post, Volume XX, Issue 1244, 18 May 1922, Page 2

THE BEEF SLUMP.

CRISIS IN THE ARGENTINE. ! HUGE WAR PRICES CAUSE LAND , BOOM. In view of the recent slump in beef, due in large part to keen competition from the Argentine, the following review in the crisis in the cattle trade in the country, appearing in the Buenos Aires Standard may be of interest : "The grazing interest in the Republic is relatively colossal. We regret to add that it finds itself in a difficult situation, one which various organisations do not hesitate to qualify as disastrous. The value of stock has< fallen 40 per cent, according to good authorities, and the tendency is still downward. This means bankmptcy of the business unless adequate measures are taken in time. In regard to these measures opinions differ, but upon one point all are agreed : The National Bank is called upon to advance 250 million paper dollars for the relief of the stockbreeders. Another suggestion is to fix the minimum price of meat for export at 65 cents the kilo, or roughly 6d per lb. Against Fixed Prices. " While in full agreement with those who ask for financial relief, we do not think that any good can be looked for from the establishment of a minimum price, which amounts to nothing more than an artificial, automatic check to trade. There use,' we submit, in asking the consumer to pay more than he is willing to pay for a given commodity when there is more than a probability that he can get a superior article for less money. What the agrarian interest may not have devoted attention to is the reality of competition in the British market, the one which is, and always has been, Argentina's great mart. Owing to circumstances deriving from the war, the great cattlerearing countries find themselves face to face with increased demands 'and augmented expenditure. In this respect the Argentine grazier has nothing more to complain of than the Australian or Canadian breeder has to face. There is this difference, however, in the British Dominion the tendency to put all the eggs into one basket is not so perceptible as here. The Land Boom.

" The war, or rather, the huge prices which the war made possible, had a demoralising effect on the Argentine breeder. During the conflict he grew accustomed to fancy prices. He 'also took it into his head that for at least six years after hostilities Argentine meat would be in great demand, because the countries of the Old World would be cleared of their and herds. There was accordingly a great demand for grazing land, owners being able to make contracts on terms exceedingly favourable to them if not to the tenants. We all know what happened : Almost as soon as the Armistice was arranged, three years ago, there was a halt of exports, because in iEngland and France there were immense supplies of meat in stock. There, had to be, for no one could tell for how long a period the armies would remain in the field. With demobilisation came the conviction that the people, already used to a smaller meat ration, dia not feel disposed, or able, to augment it. The boom had, in brief, the bottom knocked out of it. As for the conjectured high prices for six years, it turned out to be a particularly aggravating will o' the wisp. "What happened in regard to meat has happened in regard to wheat. There is a considerable stock of grain on hand from the last harvest, but the demand is not nearly so brisk as could be wished. In the meantime the tenant farmers complain that the land-owners insist upon the rents agreed upon during the war being paid in full. The heavy fall in prices both of wheat and meat the tenants are told, ha& nothing to do with the owners, who want their rentals paid with punctuality. " The Agrarian Question." " It appears to us that, whilst loans to farmers may be justified, nothing can excuse shirking a deeper investigation into the real causes of the crisis. The agrarian question has grown out of private control. It will soon pass beyond national control unless the economists can provide a remedy based on economic laws and commonsense. ... It must not be thought that the land-owners are to blame. They have their own troubles. Government especially the Provincial Government, is eternally in need of revenue. The quickest way to obtain it is to 'revalue the land for the purpose of taxation.' .... Tenant farmers, hard hit by actual.conditions, are advocating a law similar to the emergency law passed in the National Congress for the relief of urban tenants'. They ask for a law making the rentals of 1914 the maximum for the next two years. We have nothing to say ag-ainst-such a suggestion, except that it will be rather hard on the owner whose land has been ' revalued for purposes' of taxation' in the interval.

A better plan would be to pass a law making national and provincial expenditure during the next seven years conform to the general averages of the l seven preceding years. For it may be laid down as a predicate that neither land nor Government has appreciated in real value during the interval."