WHY MEAT COSTS MORE

Dominion, Volume 7, Issue 2212, 27 July 1914, Page 8

WHY MEAT COSTS MORE

A WEALTHY NEW BUYER IN THE MARKET (By Professor W. J. Ashlov. in tho "Daily Mail.") ', The main reason why the price of meat for the kst couple of years has been so high is very simple, and can be told in half a dozcii words. For tho time demand has outstripped supply. Since 1903 the total estimated weight of beef and mutton, homo-grown and imported,, available for consumption in tho tfuited Kingdom has remained almost stationary. But since 1908-9 this country has risen out of industrial depression. Tho last throe years, in spite of great strikes, liavo been years of prosperity and good emplo3'nieut. 'lhe middle and working classes' have become progressively more ablo to purchase meat freely' and to pay what was asked; and since proportioiiately larger qua'ntitics havo- not • oeen forthcoming! prices have risen and havo stayed up. .. - The United States as a Buyer. Supply, Was already lagging behind demand when, in the later months of last year anew and unexpected factor mado its appearance which seems destined profoundly to affect the situation So recently as seven years' before tho United States had been the largest supplier of meat to this country in the form of. : beef and cattle. Whatever may-have" been'the causes that source of supply for us has sines almost completely dried up. . That might not seem to matter so long as' the place of the United.-.States-was taken by Argentina. High prices might still be relied upon to'cure themselves by evoking a larger supply. And the high prices ruling in 1912 and continuing with little intermission into 1913 didreally attract to us in' 1913 largo imports from Argentina and Australasia. The year 1913 was, howover, "a time of cveiv greater national -prosperity, with improved wages and a greater volumo of-employment; Consumptive capacity increased; and it was only towards the latter part of tho year that the heavier supplies began to pull prices down. . They had hardly begun to-do so, however, when the United States suddenly appeared on the world's meat,market, not as a seller, but as a buyer. Tho tariff changes of' 1913 throw opeii tho United States to ■ the ire© importation of foreign meat. And at once, in the closing months of the year, .cargoes of beef whioh would otherwise - have come to this country were:diverted to the new purchasers; it even became profitable to send back •across the ocean to.the great.cities of the North American seaboard some thousands of tons "of South 'American moat that had. already reached Liverpool. 'The price of beef returned at onco to its recent high:level, and, of. course, the alternative iviand, was also affected. ....•.."• . Supply Still Behind Demand. During.'the \present., year' the same forces have continued to operate. , Thb, prevailing high prices havo. succeeded in bringing to our shores larger imports of meat than iii the '' corresponding period: of. -last year;' and yet, in spite 'of this,: the price of beef and mutton' iiias continued to rise,-.with''very,little break;. .'; The reason is evidently that supply still lags behind demanil. And tho supply has been notably: smaller than jt would have been but for the American demand.", Wo have managed, it is true; to secure a larger quantity ■ but we have had to pay more to, get it. . , I "ventured to suggest-; some three years; ago-,tliat.the most general cause of: the.almost universal rise of prices. was''tor be found, ultimately and indirectly, in the increased output of gold.;. It ;.would seem, impos-' sible to say .a "thing like; that without being,supposed to maintain that all increases., of price, of every single" commodity are due to that.one influence. As it happens,-* I went on to conjecture that tho effect of the new gold: on prices •was already beginning to be exhausted,: and that this. w;ould become, even more evident if,' as seemed likely, .the output' .of gold began to decline. .'And the facts are —whether they are connected or' not —that_ the output of the mines, after, mounting upward for a decade, year' after year, actually fell off a'little in 1912, and' quite' substantially in 1913;, and that the general movement of commodity prices during"; the year has .been 'steadily'•■downward.- Meat; therefore, is quite exceptional, in that it has not only not shared in the general movement, but gone in the opposite direction; and it is clear that the' chief .explanation is to-be found -in causes : special to itself.- •...,.' ... Little Prospect of .Lower Prices. /.■ How long 'are Ligh meat prices likely to continue? It is .impossible' to say. There is room for enormous,expansion in cattle breeding and pastoral farming 'in South' Amerio.i;. ana Australia has, recently shown itself capable ,of unex-pectedly-large exports or meat. Moreover, there are wide.tracts of theearth's : surface still, undeveloped'. But the'expansion of production, cannot be; : very rapidly effected, and meantime the United, States has almost certainly come to stay as'a large and. wealthy rival, customer.for the output of other lands. Moreover, any substantial lowering.of the.tariff on meat in'the great coun-: tries of lhe Continent of Europe, or any , alleviation of tho hygienic restrictions 1 which have a like effect, will bring additional competitors into the world's meat market. My impression is that; . so far-as.this country is concerned, a fall of price is more likely to result '.from- a decline ■• in our own demand, than from any.favourable influences outside.'But since, with our present habits', ' that decline in demand can hardly take ' place untii our people are.less able to ; Irayr-iie.j the; present wave of prosperity has begun to ebb—l do not know that it is greatly to bo desired. , The situation suggests a far-reaching question. lor a time, no doubt, the iip. • dustrial nations will go on drawing', pretty comfortably, even larger proportions of their food from agricultural and pastoral lands. As one source of .'supply fails others will open ; and quite ■ possibly we may see further improvements in methods of transportation, even though nothing' so momentous makes its appearance as tho application of refrigeration. But, the pace of economic transformation is quickening. ■ The United States came on tho stage as a supplier of food to tho world,- and ; seems to be passing off again within : the space if two. cenorations. May not ; Argentina and some other food-produc-ing countries follow the example, within a time quite short as 'history measures it? 'The discovery, for instanco, of great mineral resources might affect theml very much as the United States has been affected by the opening up of the Lake Superior iron deposits. And even if considerable tracts of the earth remain purely agricultural or pastoral, are they going to lie productive enough to satisfy the vast populations of the industrial regions? Some interr national division of labour there must always be; champagne, we may safely say. will never be produced in Scotland. But it may well bo doubted whether the'degree and kind of international specialisation that we havo. -known for the last half-century is goina, to be a permanent c'liarnctcrislie of the temperate zone. That means, among other things, that when the agricultural peoples become manufacturing, or When they become. inn limited to. satisfy the world's demand, the nianufaclurinfl pies will havo to give more attention to food production for themselves.