H.—44.

1937 and succeeding seasons the minimum was increased to Is. 2d. per pound. The minimum was again fixed at Is. 2d. per pound for the 1941 buying season, this being done through the Board of Trade (Raw Tobacco Price) Regulations 1941. These regulations are designed to prevent the sale and purchase of leaf at very low and uneconomic prices that are unpayable to the growers. While the regulations are issued primarily in the interests of, and for the protection of, growers, they have also been of definite advantage to manufacturers, inasmuch as they have protected them from unfair competition which would otherwise have been created by the sale of manufactured tobacco and cigarettes from leaf bought at very low prices unpayable to the growers. Expansion op Production of Leaf. Efforts have been made to bring about a substantial expansion in production during the 1940-41 and future seasons, this being both desirable and necessary, having regard to war conditions, to the possibility of interruption of supplies of leaf from America, and to the' necessity for conserving sterling funds. Certain recommendations were recently made by the Board to the Government in connection with the possibility of expanding the production of leaf. The Board made a recommendation that, with a view to ensuring that at least 20 per cent, of the total leaf used by each manufacturer will consist of New-Zealand-grown leaf, the Government introduce regulations to provide that as from a fixed date, say, Ist January, 1941, individual manufacturers may not clear from bond for entry into manufacture imported leaf exceeding four times the quantity of New-Zealand-grown leaf used in manufacture by them during a period of six months following that date. The Government has since given effect to a recommendation by the Board that the minimum percentage of twenty be raised to 22J- per cent, during the period of six months commencing Ist July, 1941. The Government expects manufacturers to use New Zealand leaf to a maximum amd not necessarily to restrict themselves to the minimum of 22| per cent, which has been decided upon. Availability of Additional Land. With a view to providing data for the assistance of the Government and of the Board in steps taken to expand the production of leaf, the Board arranged for aerial and soil survey maps to be prepared by the Cawthron Institute. These have been prepared and have already proved very useful to manufacturers desiring to increase their tobacco contracts with growers. These maps reveal that, in so far as the Kaiteriteri and Motueka Subdivisions are concerned, without interfering with the cultivation of hops and. orchards shown on the land-utilization maps, there are 897 acres suitable for tobacco-growing in the first and second grades of soil which were in pasture, fallow, and Other crops last season. In so far as other tobacco-growing areas of the Nelson district are concerned, no figures are yet available, but this information will be forthcoming in the near future. With the steps that have been taken by the Government there is now reasonable certainty and surety in the industry, both from the point of view of growers and manufacturers, and manufacturers may be expected to place contracts year by year for a steadily increasing amount of leaf, thus ensuring a steady expansion on the growing side. Tobacco Research. Further progress has been made with the equipment of the Tobacco Research Station at Umukuri. A glasshouse, tool-shed, garage, and pumping-station have been erected and an irrigation plant installed. The erection of a laboratory building, which will provide office and laboratory facilities for the work of the station, has also been proceeded with. Under the administration of the Department of Scientific and Industrial Research, and with the full collaboration of the Cawthron Institute, good progress has been achieved by the Tobacco Research Committee during the year in carrying out an extensive programme of tobacco research. The investigations have been effected partly at the Field Station at Umukuri and partly in the laboratories of the Cawthron Institute, according to the facilities available. The Tobacco Research Committee comprises representatives of the Departments of Industries and Commerce, Agriculture, and Scientific and Industrial Research, the Tobacco Board, manufacturers, and growers. Brochure. During the year a brochure has been published and circulated by the Tobacco Board to the growers entitled " Hints to Growers on the Care of Tobacco after Harvesting." This publication was prepared in collaboration with growers, manufacturers, and the Tobacco Research Officer. The issue of further brochures by the Board is contemplated, one covering operations from the seed stage to planting out in the field, and the other dealing witli the cultivation of tobacco from planting out to curing. Adoption of Standard Grades of Leaf. Although it was considered desirable that standard grades of leaf should be adopted, after considerable deliberation it was decided by the Tobacco Board that this was impracticable at the present time, because it was realized that it is not practicable to have a basic average price fixed for the crop, and at the same time to have fixed grades and fixed prices in relation to those grades. Recommendations, however, were adopted and have since been adhered to by the manufacturers whereby each individual manufacturer determines the grades of leaf suitable to him and exhibits a range of samples of acceptable leaf, together with descriptions and samples of each grade. Export of Leaf. Last year, on account of the policy adopted by the Government in relation to import control, and in view of the resultant increase in demand that was then expected and which has since eventuated for the consumption of locally-grown leaf, no leaf of the 1939 crop was exported. Since that time, with the outbreak of war and the consequent interruption of shipping, combined with the necessity for conserving overseas funds, it has become still more necessary that the whole domestic crop be retained in New Zealand. There were therefore no exportations of leaf of the 1940 crop.

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