A SO-CALLED " SQUARE DEAL."

Dominion, Volume 6, Issue 1847, 5 September 1913, Page 5

A SO-CALLED " SQUARE DEAL."

IN BUTTER FREIGHTS. (To the Editor.) Sir,—The conditions under which the Union Steam Ship Company are offering to carry this season's butter from New Zealand to Vancouver aro such as to demand the earnest attention of everyono interested in the great possibilities of this market. In effect, it simply means diverting the whole of the New Zealand butter trade to the factories situated in tho Auckland province, and this by a steamship company that is' subsidised by the general public throughout tho Dominion. For the information of all concerned, tho position shortly put is as follows:— Canada is a new market of most exceptional promise. The following figures will show how the trade has grown in the past three years:— 1910-191 ' 9,800 boxes 1911-191 51,512 boxes 1912-1913 108,230 boxes -Given reasonably fair shipping conditions, there seemed every possibility up to a month ago of the trade increasing still further. It remained, however, for the Union Steam Ship Company to set a sharp and sudden oxcellently calculated to dishearten everyone concerned. A week or two ago the Union Steam Ship Company advertised for tenders for freight for the Vancouver service fiom Auckland, all tenders to be in by September 1. Briefly, the demand was that exporters should state exactly what butter space they would require for the Ivhole year onwards from that date. This condition is an arbitrary and unworkable one. It reduces the exporting of butter by that route from a highly-promising business enterprise to a strikingly dangerous speculator's gamble. The Canadian market for tho ensuing year is only now opening, and buyers . will not at present determine their commitments for regular monthly shipments. This condition is serious enough in itself, but in addition all producers and exporters - of butter south of Auckland are at a serious monetary disadvantage. Even if shipment is made direct from Wellington for transhipment to Vancouver at San Francisco an additional charge for coastal freight from San Francisco to Vancouver is imposed, at the rate of Jd. per lb. or 7d. per box. Last, year fair quantities of butter had t-i be shipped by this route, although there was a very considerable risk of quality deteriorating through possible delays at San Francisco in heated wharf sheds, and then the coastal voyage from San Francisco to Vancouver as ordinary cargo (steamers on that route have no insulated chambers). The Union Steam Ship Company did not charge anything for this coastal freight, but now they are asking 7d. per box._ If shipment is made in tho ordinary way to Vancouver direct from Auckland then freight at the rate of Jd. per lb. or Is. 2d. per box has to be paid from Wellington, Lyttclton, or Port Chalmers to Auckland, thus placing all butter factories south of Auckland at, a clear disadvantage of Is. 2d. por box. It is as well to remember that tho distanco from Wellington to Vancouver is approximately 8162 miles, and tho ratecharged for butter shipped from Wellington, via Auckland, to Vancouver, is ss. lOd. per box, or, if dircct from Auckland, as. 3d. por box, as against 2s. 6d. per box from any port in New Zealand (including extra coastal freight from any of tho side ports to Auckland, Wellington, Lyttelton, or Port Chalmers) for shipment to London, a 'distance of 12,190 miles approximately. The above shows clearly the difference between tho terms meted out by such firms as the Shaw, SavillL and Albion Company, and the New Zealand Shipping Company, as compared with the Union Steam Ship Company, although tho latter is receiving a large subsidy from the New Zealand Government for encouraging the Vancouver trade. This subsidy is paid by the general taxpayer, including all persons directly or indirectly interested in the butter industry. The greater quantity of New Zealand. butter sold to Vancouver in the past' has been supplied by factories situated in tho Wellington and Taranaki districts, but', now apparently these ])eoplo are to_ bo precluded from securing a share in this trade except at a serious monetary loss when compared with the fortunate companies situated in the Auckland district. The steamers oil tho Vancouver-Auckland run spend from two to three weeks in Australia every trip, and it should bo a very easy business arrangement for a call to be made at Wellington on the way to Auckland. This would immediately remove any disparity of rate as between producers of Auckland and tho very much greater body of producers in Taranaki, Wellington, and Hawko's Bay districts. So far thero has been no suggestion on tho part of the Union Steam Ship Company that Wellington will be made a port of call. And yet, why not? Surely the position of the Union Steam Ship Company in this matter is already one of excellent advantage. The company charges a freight rate on butter to Vancouver. 1J times more than the rate charged by the English companies that carry our butter nearly double the distance, and it is most important to remember that the English shipping companies do not mako their shippers pay coastal freights from the side ports. This is all included in the freight rate of 2s. 6d. per box.

In another way also- tlie shippers aro far hotter treated by tho 'steam ship companios trading to England, than by this subsidised Union Steam Ship Company, for in tho case of English shipments spacc has only to be named four to six weeks ahead. In theso latest demands of tho Union Steam Ship Company those. in the butter trade must pledge themselves to take a definite amount of refrigerated space for a stipulated number of months ahead, not exceeding 12, so they are asked to gamble on Canada's possible demand up to a whole year in advance. In tho event of shippers refusing to gamblo they aro penalised and their trade imperilled by tho space being given over to Australian meat shippers. Should those in the New Zealand and Australian meat trade elect to book space heavily, then in tho event of the Vancouver butter orders coming, late shipment would be found impossible, as thero would bo no space available. Shipperß are also requested to pledge themselves that the space booked is required for New _ Zealand butter only, and therefore in tho ovent of .any firm gambling in space and finding themselves unable to book orders, then the space has to bo paid for at tho full penalty rate as if the butter was shipped. There is yet anotiier disadvantage to bo noted. Allotments of space aro not transferable except at tho option of tho Union Steam Ship Company, and then butter space would not be allowed to bo transferred to a; meat shipper. An exporter's bona fides may be oeyond all yet he may bo prevented from filling his allotted space brought about by influences beyond his control, but he cannot transfer a singlo foot of his vacant spaco to any , other reputabio New Zealand exporter uf other produce. Even this does not concliulo tlie heavy list of disadvantages heaped on those endeavouring to secure a share of this Vancouver butter trade. Tho new schedule states that rates are subject io an increaso in tho event of "quarantine or ether disturbance of normal conditions." That is a sufficiently amazing provision. Who is to define- a "disturbance" or distinguish' an abnormal condition? Apparently only the Union S.S. Company. Whichever way ho turns, tho butter man is faccd with new and serious risks of loss.. Tho demand from his stand-.

point is that ho becomes tho moro toy and creature of a great New Zealand shipping corporation that is generously Subsidised from tho public revenues. Quite naturally, his feeling is one of acute dissatisfaction.

Australia has all tho best of tho position. Wo in New Zealand are apparently subsidising tho Union S.S. Company for tho express benefit of Australian exporters and the Australian travelling public. If those in tho trade don t recklessly reserve space for butter many months ahead, tho spacc they refuse to pledge is then, offered to shippers of Australian meat. These, owing to tho lower prices accepted in Australia for beef and mutton, aro enabled to largely control the meat trade to Vancouver. It is as well to noto the very much lower rates that is demanded for freight on Australian meat. Forty feet of space is charged at £1 los., as compared with the same spaco when'bought by the New Zealand butter exporter, ho having to, pay £5 17s. lOd. Special concessions in tho shape of reduced passenger rates .are also offered to Australians. A tourist can take out a first-class ticket in Melbourne, havo his railway fare paid bv the Union S.S. Company, and be carried from Sydney right through to Vancouver at the same rate as charged from Auckland to Vancouver, and this, pleaso remember, by a New Zealand subsidised company. The Australian Commonwealth does not contribute a single penny to the service in the shape of subsidy. If tho facts aro coolly considered, tho disadvantage as against New Zealand is at every point extraordinary. ' This recently-developed, or rather partially-developed, Canadian butter trade is actually a very big tiling for Now Zealand, and a very good thing for tho Union S.S. Company. The trade has been established and built up wholly by the efforts, and at tho cost, of the butter producers and general public of Now Zealand. Tho whole cost of producing this trado and its resulting big freights from New Zealand to Vancouver has been ■borne, in the main, by those ill tho butter industry. The circumstances aro such as to justify the butter producers .in demanding that a "square deal," of which so much has been heard of late.

Tho Prime Minister has been approached, but whilo. lie has been sympathetic, lie lias certainly not, so far, boon particularly helpful. And yet tho matter is one of tho broadest democratic concern, and certainly demands tho most careful attention, of the Department of Agriculture. Any demand tlint places a minority of tlio Auckland producers at a manifest advantage over the remainder of tho Dominions' butter producers in tho South of Auckland is_ olio completely antagonistic to democratic principles of equity and justice. Any schcnio that makes it impossible for a largo section of producers to participate on equitable torms in tho chances of a great and promising market, is especially a scheme in restraint of trade. It is at least reasonable to expect that tho Government inquire promptly how a great subsidised New Zealand . company stands in relation to such a scheme. It is also pertinent to inquiro what solid advantage, if any, XV tnv Zealand is getting in return .for its subsidy. Tliese aro matters for tho earnest consideration of the farmers who stand for the backbone of the butter industry, 'l'liey aro matters also for the consideration of all tboiighttul citizens, since any menace to ono industry inevitably threatens all. It is amazing that butter men should be so much more liberally treated by tho Shaw, Savill, and Albion Company and other British shipping companies than they aro by a Now Zealand shipping company, that is so liberally subsidised by tho Dominion. Tho exporters, iu the special sense, need not be considered, for tlio case of tho exporters is the caso of tho industry. These new exactions hit at the man on the land; in fact all who aro interested in any way in the industry.

In all, £100,000,000 has been spent in New Zoaland on railways, bridges, roada, harbour boards, for the development of trade, and for whoso benefit? Surely not for the Union Steam Ship Company, who, in this new buttor market,. not, only fix tha rate of payment for freight, but whon; how, and practically from what port shipment shall be made. Is this fair? The subsidy paid to the Union Company is no moro than the interest on the capital that would be required to establish a lino of Government' steamers to trado between New Zealand and Canada. Tho principle of. controlling the rates charged to the public has already been established by the Government owning _ tho railways, telegraph and telephone lines, coal mines, fir.o and life insurance companies, so that it would not be a very great experiment to own a line of steamships. Railway companies in Great Britain, Canada, and other parts of the world have already proved that it pays to >run steamship lines in conjunction with their railways. In tho United States of America, and in Canada, tho railway freights are controlled by an inter-State Board. South Africa has gone ono better, as in addition to the railway rates, both the sea freights in and out are controlled. The Commonwealth of Australia have just invoked an intor-Statc Board to deal with freights and other matters.

This matter is ono that deserves very carcfnl consideration on tho part of the Government, as apparently powerful corporations, such as tho_ Union Steam Ship Company will not give the same opportunities to the entire Dominion unless their hands are forced. It is almost certain that if the proposed contract conditions are left in their present form, the bulk, if not the wholo of tho spaco available 'for both meat and mutton will pass into tho hands and control of two firms, whoso headquarters aro in tho American continent. By just such tactics the South American beef trade is passing into the hands of American firms. All this is projudicial to the producer, and everyone who ha,s the interest of tho Dominion at heart should do his best to prevent same. The company brings down a great deal of produco from Onehunga and New Plymouth to Wellington for transhipment to the English steamers, and for t'his tihey cannot get moro than 10s. to Ids. per ton, and havo to carry same in refrigerator chambers; but if the same space is wanted on'return from Wellington to Oneliunga the rate is £2 6s. Bdi. Why? The company when asked are quite candid. The answer actually given is: "We don't want this trade from Wellington to Vancouver. You people can ship your stufi to San Francisco, and tho Americans will be ready to receive it wlicii the tariff is altered." . Tho Union S.S. Company does not only fix the rato of freight, but actually has tho audacity to say where tho produce shall po and by what routes. It is really up to the Reform Ministry, with their high ideals as to "a square deal all round'," to see that those engaged in tho buttor industry aro not left at tho mercy of the Union S.S. Company. Tho representative of tho largest Auckland combination lias spoken in no uncertain tones as to the. opinion held in that city on tho one-sided position, and tho necessity, on principle, of treating all ports qii the samo basis. On several occasions tho Union S.S. Company liavo referred to . California requiring Now Zealand buttor as soon as the United States' tariff is altered, and that Wellington, will tlion have tho favoured position^ It will take quite a number of years before New Zealand butter becomes popular in California, as it is quite different to what tho peoplo aro'accustomed to. Tho cows in that part of the world are mainly fed on alfalfa, and this gives to the butter a flavour that cannot bo approaohed in any way in New Zealand. Tho colour is also much brighter than with tho New Zealand article. . So as to fall into line wtb

United States pure food laws, all butter sold to California will have to bo specially mado for that market, as even tho small percentage of preservative (half of 1 per cent.) allowed by the laws of Great Britain and Now Zealand is not permissible in the United States. Then again the hulk of the butter is required saltloss, and lias to be put up for public sale in Boz., 160z., and 320z. packages. 0110 more word in passing. Why should Californian products be carried at the 6amo rates from San Francisco to Wellington and Auckland, thus giving morchants at the latter port a concession of tho coastal freight, a privilege that, is denied on the outward journey, although the freight from tho terminal port is two to threo times as much ? —I am, etc.. J. M. MUIR. Wellington.