MEAT PRICES

Dominion, Volume 11, Issue 52, 24 November 1917, Page 8

MEAT PRICES

THE RISE IN BRITAIN

AN OFFICIAL REPORT

OPERATIONS OF THE BOARD OF TRADE

Some interesting comment on the increase of prices since tho beginning of the war ia mado in the report of a committee appointed by tho Imperial Board of Trado to investigate the principal causes that have led to tho rise in the cost of living. The report, which was placed before the Houso of Commons somo. months ago, refers in detail to the movement of moat prices', a matter that concerns the producers of New Zealnnd. Tho main reason for the increase in the price* of imported meat in the United Kingdom, states the report, was tho abnormal demand for frozen meat for the armies of the Allies. "Before the war, tho main and almost the only European market for.chilled'and frozen meat was tho British. Not only, however, did the War Office, on the outbreak of war', place a largo new demand for frozen moat, which has progressively .increased, but the French and Italian armies were now compelled to follow tho example of Great Britain, and to supply their armios with imported frozen meat. In the middle of 1915 tho French cattle herd had been reduced by 2,300.000 head partly owing to the ravages of war and partly to the demands of tho French Army. Foreign imports, thus became a necessity. Tho greatly increased demand thus made upon the world's stocks usually availablo for British consumption has led, under existing conditions, to a' great general advance in price. Not only do tho now British armies in the field and in homo training consume very much more per head than was the case in time of peace, but the French and Italian armios make a new demand on the extra European supply. Consequently meat prices have risen in neutral countries in general, as. well ae among the belligerents of tho Eutente. In the Central Empires they have risen very much more. . . . The growing

army demands have reduced the quantity of beef and mutton available for general consumption in the United Kingdom. According to one expert calculation, whereas tho imported supply formerly constituted 40 per cent, of the whole consumption, it now constitutes rather less than 20 per cent, of the civilian consumption.

"This statement furnishes tho main, explanation of tho fact that whilo tho retail meat trade has greatly shrunk, many hundreds of shops being closed, high prices continue to be maintained. As a result, on the one hand, of the reduction of tho imported supplies and attendant high prices,' and, on the other hand, of -ilie appeals made bytlw Government to the citizens in general to curtail their use of moat, it is estimated that tho civilian consumption of beef and mutton has latterly been reduced by about one-sixth.

'The securing of an adequate meat supply for their armies was naturally one of the first concerns of the Allied Powers, and the British Government has from an early stage operated on behalf of the Allies as well us oil its own. The'chief sources of «t'ablished supply were the Argentine Republic, Uruguay, ami the Australasian Doming ions. But naw works had been opened in China, Venezuela, and Madagascar; large developments were possible in Brazil; and some, increases could be looked for from Canada and South Africa. As national tastes in 'meat vary, the British demand has continued in tho main to bo met from former sources, while Uruguay, Venezuela, and Madagascar have been drawn upon for France, and China and Brazil for Italv. As regards the supply from Australia and New Zealand', the nation is under a debt of gratitude to the Domjninus for their prompt co-operation. In August, 19H, the Queensland Government passed an Act giving them full control over the moat bupplics of the. State for Imperial purposes, arid New South Wales passed a similar Act early in 1915. When in February, 1915, the Australian and New Zealand Governments agreed to purchase on'behalf of the Mother Oountrv nilthe beef, mutton, and lamb availablo for export, f.0.b., prices were amicably arranged in all tho States, and the whole exportable supply was duly shipped. Unfortunately the sovore drought of 1915, which destroyed a largo quantity of stock, greatly curtailed Australian supplies, thus tending to raise prices still further." After quoting figures to show the increased prices received by the producers of New Zealand, the report states that all tho Australasian meat not required for Army purposes is put on the home market, and the prico obtained by the Imperial Board of Trade has to cover not only the purchase price, but also the cost's of storage on land, freight* insurance, and landing and selling expenses. "South American supplies, of course, cannot bo similarly regulated in tho Allied interests," continues the report, "and the situation there is determined by the ordinary play of commercial motives, with the important modification that tho British Government controls the insulated shipping required for transport. "The settlement of prices (of South American supplies) has from*'an early stage been entrusted to Sir Thomas Robinson, who placed his services at the disposal of the Board of Trade, and has subsequently negotiated the purchaso of the French and Italian Governments, competition in buying being thus advantageously averted." The first, contract fixed prices on the basis' of market rates. A. second contract with the Argentine companies fixed prices slightly higher than bad been paid under the first contract, but actually lower than the market price of landed cargoes at the time. A third contract, which covers "tho whole pro- ■ duction of the flocks and herds of Uruguay and the Argentine, save for the meat available for importation on the private account of the meat companies," fixes prices 7 per cent, abovo the prices paid under the second contract, and will continue until three months after the close of the war, subject to threo months' notice on either side. "The general opinion of expert witnesses, in which tho committee concur, is that, considering all the circumstances of an abnormal situation, the buying on behalf of the Board of Trade has been economical." The report lays stress upon the shortago of insulated shipping space,' and discredits the jdej, that prices in the United Kingdom liavo been inflated artificially by tho operations of trusts. Increased profits lmvo been mado by producers, freezing companies and jobbers, "liut the substantial cause of increased profits is rather tho shortago of supply than iiny process of combination, and but for the Government control of colonial meat, prices mitrlit be higher. "Where price control is practicable —Unit is, in the case of Australasian meat put on the market by the Government—it appears to bo efficiently exercised. The firms who formerly received tbe Australasian supplies, some twenty-five in number, act as selling agents for tho Board of Trade, receiving a commission of 1 per cent, on sales ex ship, and 2 per cent, on other sales. They are held bound to sell tho meat in tho usual manner, generally to distributors, but also to larae retailers, who, in the past, bought direct from the importing houses, so that as far as possible it. shall pass through the usual channels and in the

usual quantities. In ao case are the wholesale distributors allowed to add more thiiu Id. per pound to tho price at which they buy from the selling iSSnts. . . . Selling agents who wero formerly in the habit of supplying meat, to their own wholesale or retail branches may do 60 in proportionate quantities, but in that case they get no commission,' and the price they pay is fixed, by assessors appointed by the Board of Trade. No price is laid down, for retailors, but the wholesale soiling policy probably eeouree a, general check on inflation, tie instruction to tho agonto being that they should aim lit steady and moderate prices."