SCHEELITE

Dominion, Volume 11, Issue 88, 7 January 1918, Page 9

SCHEELITE

PRODUCERS' COMPLAINTS OF INJUSTICE DEADLOCK ON PRICE [The following statement submitted by.the representatives of several companies which produce scheelite gives a summary of ft dispute ivith tho linpecial Govornmont on tho question of price.' The New Zealand mineowners complain that they are being treated unjustly.] .Throughout this war the groat b<ttlecall of the Entente nations has been Bight •against Might, Justice against Injustice, .Liberty against Oppression. The British' nation has' alwaye been in the forefront of fights for Freedom, Liberty, and Justice—but to-day, by the obstinacy, bungling or ignorance of departmental otlicials in Lundon, the Imperial Government has its name associated with injustico in regard to oue group of Now Zealandere, the producers of echeelite. This mineral and the allied ore, wolfram, yield tungsten which does very iuiptrtant war service by hardening the large quantities of special steel required for tools in the workshops of Great Britain and her Allies. The very satisfactory use of tungsten for various war purposes'lns assured a good future for this i. etui in the world's workshops after tho war, and therefore high prices for tho tungsten ores are in prospect. Scheelito and wolfram are quoted at per unit (that is, per 1 per cent.) of tungstic qcid per ton. For example, a ton of echeelite containing 63 per cent, of tungetic acid is reckoned at 65 units. Tho ore is sold under assay guaranteeing the units of tungstic acid per ton. Before the war.Germany was practically the only buyer of e.'/heeliteand wolfram. From 1902 to 1015 the price ranged from £75 to jnore than i>lso per ton, according to the euppliee available and the demand of eteel manufacturers for tiungetio powder (pure tungsten) or ferro-tungsten (an alloy cf about 79 per cent, tungsten, 16 per cent, of .iron, 3 per cent, of carbon and 2 per cent. of. silicon or other elements). Aβ far back as 1907 scheelite went to 51e. per unit.(equal to ,£162 a ton for 63-unit ore). About seven or eight years ago one New Zealand mine obtained about J2OO per ton for a short while, and at the same time the company received an offer .£50,000 cash from Krupps for the mine.

However, the general range of prices was much below these figures. Before the war only one New Zealand mine paid a'steady profit; in. the face of high costs of production tho prices for scheelite did not encourage the development of the industry. One company can point to an .expenditure of .8100,000 in plant, naterials, and labour; up to.the present that company's returns from scheelite have been almost wholly absorbed in costs of production. The war demand brought a much-needed fillip. The producers had hopes that they wouJdbe compensated for lean years. They had a satisfactory beginning, but they were placed ally at a serious disadvantage by the Imperial Government, or by "some person or persons unknown,", acting in the name of the Government., .

Injustice No, 1. ■' By August, 1915, several of .the New Zealand mines had,received offers i'lom England for the purchase of scheelite at 655. per unit, f.o.b. New Zealand (equal ' to' .£2lB per ton for ' G5-unit ore), but "Caesar," the.lmperial Government, in- ■ tervened. An ouibargo was placed en private shipping, • and tho New Zealand Government was instructed by ''Caesar" to arrange for the purchase at sf«. per unit c.i.f. (equal to £178 15s. a ton for 85-unit ore). After allowance for the difference between the f.o.b. and c.i.f. conditions, "Caesar's" quotation was about .£4B a ton below the price obtainablo for private contracts with Eiitrlish firms. "Caesar's" attitude was: "Take it or leave it." It was virtually a , ultimatum. The producers of 6cheelite wore not consulted. The chairman of one company was invited .to a conference, but he had no. voice in tho fixing, of the price, which was embodied in ah agreement fer' the term of a year; It was , practically an Imperial mandate. The original order did not mention brokerage, but subsequently the producers were loaded with

1-per cent; under that hoad, : and they were charged 5 per cent, intereat on eocalled "advances," which were, ntfaally proptfees payments. It was not (ill a shadow of litigation came up that this preposterous imposition.was dropped. Producers of meat, butter, cheese, and wool have always been.fairly consulted. They were not originally forced, as the. schoolito producers were, into the .icceptanee of prices below' market ntes; on the contrary, the producers.of ineat and wool received an advance on the luarket rates at that time. There was discrimination against scheelite, as. Mr. Dihdmarsh ■ (Labour member for Wellington South) described the position in the House.of Representatives on October 19 last,, thus (Hansard report):"Hβ thought there must be some misunderstanding in regard to the natter, and if not, then the men engaged in the industry were being 'treated vc.i-y differently from farmers and others. "Was it because the-people engaged in (ho industry had very email backing, arid that perhaps only a thousand wero affected, that the State should say they must not eell, or 'that a.price would bo fised for the product which would be absolutely ruinous to them ? Tim State said to one section of the people that they vruld fix a price whiob would be ruinous to it, while to other people in the country, who had a larger backing',. tho State gave much better assistance when the h; glish Government wanted articles they preduoed. It had been represented by tbose acting for the farmer that the goods should be taken at a fair price—fair from the farmer's point of view. Here was a filnall industry, however, that was receiving no consideration at all, and he could not understand it. The only argument ho could draw from tho position was that those people were not sufficiently strong to agitate." ■" ' 1 Injustice No. 2.

At the end of (he year tlie "Imperial Government" refused to grant a better prdoo than 555. a unit,- c.i.f. (.£l7B IBs. a ton for 6uheelito of C 5 per cent, turigstic acid). In the interval the cost of production (labour and materials) had iixreased greatly. Much skilled labour (withdrawn to the war) had been replaced by less efficient workers at higher wages. The dearer materials were also oi' inferior quality. Everything had risen against the scheelito producers, but the "imperial Government" would not budge from the hard-aifd-fast 555. c.i.f. An argument iras used that if an increase was granted for New '/.ealand (that is, if New Zealand producers were granted justice, instead-of injustice, by Imperial decree), tho price would have to be correspondingly raised for other producers within the Empire. However, it is a; fact that the greater part i.f the tungsten used in Great Britain ccmea from Allied and neutral countries—mainly from Portgnal—at about 90s. ppr limit *£300-a. ton) under contract. In Burmah, tho biggest producer within the I'npirc, cheap coloured labour ia employed.. It is nbvioiis that sf>s. per unit for J'urimh is much belter than 555. for Now Zonlaiid and Australia. Tho flat ralo makes for injustice. Injustice No; 3. , The .'".lmperial , . Government," . 13,000 miles away, declines to give -heed to any. etatcmeut of Ihu local coiiditiajis.Many official cablegrams havo been sent to I'hu High Commissioner. They are mostly ignored by tho "luijiorial Government." 'l'liu Beaut replying litio been extremely unliiitiht'aclor.v. It always amounts l(i thiij, in effect—''sss. per unit ami nil him; nioru'. Tako it ur leave i(." Tho local 'producers cannot afl'ord to take 55r. .it present cost of production. Since tho expiry of tho agreement they have held their Kchuelile in tho, Inpe thai. a sentio of juslico would come lo tho "Imperial Government" in this matter, 'llicy 'expected'that if Hie "Imperial Government" was not willing U> pay a fh:r price it would 'allow (ho New /ionium! produccia to ship to an Ally, I ho United Slates, which needs lungstou for wer purposes, and ie ready lo pay 110s. a u.nit (JI3SO a ton) for scheelito (05 per cent. Ui'Rstic acid). This reasonable request has been mado in vain. Injustice No. 4. While the "Imperial Government" has persisted in tho infliction of injustice on the New Zealand producers, it has allow-

Ed extraordinary- scope for manufacturers' profits in IJngUuid. The scheelito is sold by the "Imperial Government" at iSOs. per unit (J!197 lfts. a ton.for liOunit ore) to the manufacturers of tuugstic powder and ferro-tungeten. These persons sell the powder to the steel umkers at &. 3d. per pound, and (he i'errotungsten at ss. lid. por pound. On the basis of a. ton and a half of echeelito for the production of a ton of tuutjsiic powder, the manufacturers pay Hlwut JC3OO for the raw material from which the tungstio powder brings them ,£'7oo. It is believed that tho process leaves an onornioue margin of profit. Before the war German manufacturers did tlio conversion for about £&) a fon; the English rate means a multiplication of that figure by eeven. It would be easy for the- "Imperial Government" to grant justice to New Zealand producers by reducing the exorbitant profits of the English manufacturers. The injustice that is imposed hore facilitates an inflation, cif war profits in Ingland.

Injustice No. 5. VVhon cable messages failed !o niako the slightest) impression on tho "Imperial Government" the scheolito producers appealed to Parliament by petition. After etating the plea of justice, the petition concluded:— "Wherefore your petitioners pmy that this Uouso of Represenlahv&s wi'll immediately insist that eo long as wheelito still continues to be needed by Ine Imperial Govornmont the price paid to Now Zealand producers 6hal! bo at ieast as good as is being paid by tho Imperial Government to neutrals and Allies, that is. at least 90s. por unit. 'X)r that in the alternative, if Iro Imperial Government has not sufficient need of the New Zealand echeelite to pay the price last mentioned, this House will at once lift the present embargo on the shipping by produoers of their own echeelite, and that they thus v.ill be placed in a position to export to America, Franoe, or any country allied to Great Britain." This_ petition was referred to the Mines Committee of the House of Bepresontatives, which look evidence thoroughly on the local conditions. ' The ' committeo agreed that tho case was one for favourable consideration by the Government, and this opinion was supported by members of all parties in the House on Ootober 19 last. The motion for the adoption, of the committee's report was curried. Here are typical extracts from Hansard :—

The Hon. W. D. S. Mac Donald (Minister of Mines): "He had put the position Ps regards' sohoelite and tmgsten very plainly to the Imperial Gci eminent by cablegram, pointing out the difficulty of the scheelite mining operations in New Zealand, and the additional cost.owing to the scarcity of soheelite miners. A great number of them, like other sections of the people of this Dominion, had enlisted and gone to the front in the Mining Corps or eorns other division* of the Army, on the outbreak of war." Mr. MacDonnkl also remarked in tho eame debate: "Only a few days ngo the Bight Hon. the Prime Minister had sent a further cablegram Homo stating that the industry would practically cease unless a higher price was mid for ■ the ore, but no reply had yet been received." That is tho usual result—"no rrply"— or an absurd one, which again inaists on injustice. Mr. G. Witty (Riccnrton): ."It seemed a very unfai). , thing that while the Dominion was in possession of a very essential and valuable ..mineral—a mineral, too, which wae indispensable in the manufacture'of mnnition-s in the Old Country—it could not be exported to England exbepl at a price which would not pftj the mine-owner.? to quarrj the material. Hβ hoped the Minister would impress upon tho British Government that they should either pay n reasonable price—a price something in accord with what they we're paying other countries, or allow it to be exported to an Allied country. So far as the mines were concerned, they wero in a vory rough country, and hard to got at, while the mine-owners had. had a very hard time trying to

ninko both ends meet. If they wore compelled to keep tlioir stocks they could not afford to pay the interest on tho bank overdraft, and there- would be groat loss inflicted on them. It had been eaid by the Minister that tho price was going to drop after the war; but ho (Mr. Witty) doubted that. Scheelitc was so valuable that it could not go down." Mr. T. A. H. Field (Nelson): "It was certainly an extraordinary position that the scheolito mining industry in Now Zealand should I>e on the point of extinction owing to the action—inaction rather—of tho British Government. ... It was apparently neglect on the part of some British official, and it would be a misfortune if (lie soheelite industry in Now Zealand came to an end through British red tape." Mr. G. W. Forbes (Hurumii): "The men had a real grievance, and the Minister had endeavoured to remedy it, but it; seemed to him they were not getting to the right persons in order to soouro ft remedy." Mr. H. Q, Ell (Christchurch South): "In fho case under discussion attempts had been made in the way of exportation, and he was sure the Minister would see the difficulties in the way of those people, and would help to get this valuable minoral product put upon tho market."

Mr. EindmareVs comineiils «ro given in another section of this article. New Zealanders hardly need n reminder that Messrs. Ell and Hindmarsh are not supporters of any attempt at unfair exploitation of British people, but they are against unju6t exploitation of Now Zealand scheclito producers by persons acting in the name of the "Imperial Government." Thus tho higheet tribunal in New Zealand, the Assembly elected by the,people, has recorded its belief that the attitude of the "Imperial Government" inflicts injustice on thoeoheclite producers of this country. It seems incredible that the Imperial Government should persist doliborately in a course of flagrant injustice. A deduction from a comprehensive examination of the facts is that the name "Imperial Government" covers the amazing unwillingness of subordinates to recognise the elementary principles of justice for which the British nation ia fighting. x Thus ■ a local industry is hampered ; one of Britain's Allies is debarred from the scheelite for which .the Imperial Government refuses to give a fair price; and the Now Zealand Government is loßing considerable revenue which would be available if the scheelite industry received justice instead of injustice from tho "Imperial Government. Thin is a travesty of the traditions and principles for which the British Empire declared war on civilisation's enemy. Aβ proof that the price offered by the "Imperial Government , ' was.not one to expand a dividend, a large New Zealand Company offered its mine to tho Government at 10 per cent, on the capital, during the period of war. Although this offer was 5 par cent, below the rate granted in America by tho United States Government in similar circumstances, it was declined. It is stated, by the chairman of this company that acceptance of the Imperial Government rate (Ms. per unit c.i.f.) today would be unprofitable. The company prefers to oarry on with bank advances against the scheolite, which is held here in the hope that a better price will be obtained ultimatoly.