COAL PRESENTS PROBLEM IN ECONOMICS.

Chronicle (Levin), 6 January 1948, Page 7

COAL PRESENTS PROBLEM IN ECONOMICS.

GREYMOUTH, Jan. 5. j Although the Btate Mines Depart- I ment sells large quantities of screened j coal from est Coast mines to private I consumers at between 27s 3d and 28s I 9d a ton at the mino, another Govern- j ment department is to pay probablv £'/ 1 10s a ton for coal mined in Englaiul in | order to keep up the railway -stocks. J Much of the West Coast coal is 3 eminently suitable for railway use, anu ! much of it is thus absorbed. ' The Gov- S ernment, howover, has ' obviously found I it impossibie either to increase tlie out- | put or to exclude the private buyers J from the market, so as to bridge tne. J gap between the amount of coal avaii- 1 able- aud the railway demand. \ A peculiar, position has, therefore, | arisen of the Government selling coal | which it actually neets for its own use | at approximately 28s a tou and repiac- ! ing it with imported coal costing four I times as much as its own. product. The | selling price of 28s a ton does not teli | the full story as it is well known that I the cost of production in most instanees | is well in exeess of the selling price, I the difference being made up througk I subsidies. It is'estimated that much of | the State coal would have to be sold at | round about £3 a ton to meet the fuil ! cost of production. I The actual price paid by the Kail- | ways Department to the State Mines I Department for West Coast coal is not ; known, but allowing for the fact that | the cost of production in New Zealand I is much higher than the selling price I it is clear that the cost to the Domin- I ion of the English coal will be well over | double the cost of the West Coast coal. I