WHEAT AND FLOUR

Dominion, Volume 10, Issue 2998, 8 February 1917, Page 6

WHEAT AND FLOUR

FIXING THE PRICES

THE PROCLAMATION CRITICISED

The action of the Government, in fixing maximum prices o'f wheat, representing an average of ss. 10d. per bushel, and the maximum price of ITour at £15 per ton, has produced much adverse criticism. One Wellington merchant stated yesterday that the inevitable effect of fixing the price of I\e\v Zealand flour at £15 per ton fro.b. in' the south must be to raise, it by 15s. a ton above present prices. On February 5 New Zealand Hour -was quoted to local importers at £14 ss. per ton. Owing to the large quantity of Australian flour that had been ing in to New Zealand during the Inst two months (at prices under that quoted by New Zealand millers) New Zealand flour had heen practically off the market here. Now the price of local flour was to be raised to £15 per toil, added the merchant, and this was followed by the re-imposition of the duty of £1 per ton in order to give the New Zealand millers the opportunity to sell their produce. Did this reduce the cost of liting'? he asked. In June last year tho board, in the course of an interim report on the price of bread in relation to the ruling price of flour, said: — "We have considered the question whether the fixation of maximum prices by legal enactment for wheat, flour, aiiol'bread, or by. the method of 'recommended prices,' which was adopted in aJngiand, would be best suited to the conditions here. There are difficulties unuTr Both systems, but on the whole we prefer the latter-method, and suggest that the following table should be the recommended prices, subject to alteration by the Board of Trade, as may he required:— Bread Flour cash at Wheat mill. f-o.b. counter. s.d. sd. £ s. d.. : 3 9 to 9 10 6 3 9 to 4 0 10 0 . 6 40 to 43 10 10 6 4 3 to 4 6 11 5 6} 40 to 40 11 10 6549t0 5 0 •12 5 6} 5 0 to 5 3 13 0 7 "The majority of master bakers, it is pointed , out, discmirage over-the-counter sales of hread by charging the customer in the shop the iame price as for delivery. It is therefore, recom-.' mended that a, relative over-the-counter 1 price he made compulsory, and that it be m accordance with the above table, and at least lid. less than the price for delivery. This provision should ftpply to the four main centres anS the secondary towns." THE POSITION EXPLAINED. .MAXIMUM PRICES FIXED. A Dominion reporter, who made Inquiries yesterday in a well-informed quarter, was told tiiat some of the aaverse criticism directed at the proclamation fixing the price of wheat and flour betrayed misunderstanding of the position. The average price of ss. 10s. per bushel for wheat admittedly was fairly high, but the Government Bad considered it necessary, in the public interest, to give farmers substantial encouragement in. the growing of wheat. •■ It was highly important that New Zealand should produce enough wheat for local requirements during the next year or two. The United Kingdom was drawing enormous supplies from Australia, and the shipping shortage became more acute every day. New Zealand could not count xipon being able, to get cheap wheat from the ComniQnwealth. The export price of Australian wheat even 'at the present time was ss. 6d. per bushel, and the addition of freight and duty would bring the New Zealand landed cost to something over 6s. 6d. per bushel. The proclamation had stated that the prices of flour, pollard, and bran at southern ports should not exceed £15, £6, and £4 per ton respectively. Thfl price of bran had been ~ inaccurately stated in some quarters as £4 10s. per ton. . These were maximum prices, and there was nothing to prevent millers selling below'them if the price of wheat would allow them to do so. This point'applied particularly to bran and pollard. If the millers could import wheat below the price fixed for New Zealand wheat, then they were not bound to charge the maximum prices for their flour, pollard, and hran. The proclamation, it was added, would have the effect of preventing any increase in the price of bread. The proper relative prices of wheat, flour, and bread, according to information collected by the Board of Trade, and carefully examined by that body, were as follows:— Wheat Flour Bread f.o.b. f.o.b. delivered. . ss. od. £13 ffjd. ss. sd. £14 M. os. lOd. ■ £15 9id. , 6s. 3<3. £16 10d. With flour costing £15 per ton f.o.b. ah Lytteltpn .the price in Wellington, allowing for the usual discount, should not exceed . £15 15s. _ per ton. The Government is. not fixing prices for the bakers- at tho present time, but it would -be prepared to do so if the retail price of lirpnd rnsn !ibove thn I""o' that is regarded officially as justified by the maximum price of flour. The prices quoted above are for breed delivered, and the Board of Trade lias already stated the price of bread over the counter might to bo lid. less than the delivered prine. The 1-Jd. represents the cost of distribution, book debts, and so forth. The duty of £1 ,per ton on ininnrtod flour has been reimposed, and will apply to all importations except those actually on the water at the present time.