NOTE OF WARNING.

Waikato Times, Volume 114, Issue 19066, 3 October 1933, Page 10

NOTE OF WARNING.

“OVER-OPTIMISM UNJUSTIFIED’.’ PRODUCE POSITION ANALYSED. A note of warning was struck by Mr J. Cocker, chairman of directors of the South Taranaki Rural Intermediate Credit Association, in his address to shareholders at the annual meeting- in Hawera, when he u r S'that not too optimistic a view should be taken by dairy farmers. They should not expect prices much better than last year. Mr Thomas Baxter had told tnem that the quota was definite and that the Imperial Government had promised to restrict Imports, said Mr Cocker. New Zealand had yet to find a market for its surplus of dairy produce. The price for dairy products was no better than it had been 12 months before —In faot, cheese was lower. . t Weis true ttiG-t stocks were diminishing rapidly, but they had not yet reached the level of last year. There had been recent rain in the northern hemisphere, where .production might not he as low as had been anticipated. The World’s Debts. Nor did the monetary position inspire confidence. The world’s debts amounted ,T " 1 £26,000,000,000, of which only one-third was covered by gold. It was impossible for these debts ever to be liquidated, and the load of interest on them strained the ability of every Government.. Until confidence was restored money would not be released. The price of land in New Zealand was too high, and farmers were unable to pay their interest. The interest was piling up until the security did not cover the mortgage, therefore some adjustment would have to be made. Interest reduction was not enough, as it would be impossible to refinance on the present basis. Sheep farmers had had a harder time than dairy farmers, for whereas 5| cows had been the equivalent of only three in good times, wool had -been only one-fourth as valuable. However, it appeared that sheep farmers would come into their own earlier. He understood that lambs would open up at from 18s to £l. which was e„ 40 per cent, rise over .last ‘season.

Fight Against the Quota. He was sure that if the prices for sheep products went up a number of farmers would go back to sheep. This would reduce exports of dairy produce so that the quota would not he felt so much. However, he did not like the quota, as once the principle was established It would be difficult, to have it removed. The fight against it was just. Dairy farmers could assure themselves that it would be a long time, if ever, before they saw the prices of the past again. They should not bank on getting a great deal more than last year, as there was no reason to believe that prices would be much better. Unfounded optimism was as bad as rank pessimism.