SHIPPING FREIGHTS

Dominion, Volume 14, Issue 35, 5 November 1920, Page 8

SHIPPING FREIGHTS

OWNERS' SIDE OF THE CASE

ADVANCE IN RUNNING COSTS

Lxception is taken to the recent Parliamentary report on shipping freights by tho J»ow Zealand Overseas Shipowners' Committee: In a lotter to the Prime Minister on behalf of the committee, its chairman, Mr. James Findlay, contends that while freights lmvo increased by 193 per cent, since 1913, running costs are well over 200 per cent, above those of that year. Mr. Findlny's letter is as follows:—

The llight Hon. W. ,l'\ Massey, P.C., Prime Minister's Office, Wellington.

'Sir,—Eeferring to tho report of the Agricultural and Pastoral Industries, btock, and Commerce Committee, .recently presented to the House of Representatives, wiiorein -it is stated that "While giving full consideration to the various causes which have operated in materially increasing the cost of running vessels as compared with pre-war times, the committee, after carefully weighing tiie evidence given, is of opinion that the rates now quoted for privately-owned cargo are unwarrantably high. These rates when applied to an output of frozen meat, dairy produce, meat sundries, flax, and 1 annual by-products, equal to t thnt shipped in 1919, and an output of wool equal to that shipped in 1914 would involve the payment of £5,143,202 in excess of the payments made for freight on these products during the year 1913," I desiro to point out that such a basis of comparison is entirely misleading, and the A. and P. Stock and Commerce Committee appears to have lost sight of the fact that it was comparing in 1920-21 at the enhanced rates of freight ruling, quantities of cargo greatly in excess of those shipped in 1913. Kcr instance, the A. and P. Stock and. Commerce Committee's estimnto of meat shipments in 1920-21 is about 50 per cent, in excess of shipments iii 1913, wool and cheese being approximately IS per cent, and 157 per cent, in excess of 1913. The only fair basis ot comparison is, of course, tho estimated quantities of cargo to be shipped in 1920-21 at present rates, as compared with the lower rates of freight current in 1913.

This committee, adopting the quantities shown in the A. and P. Stock and Commerce ComimKee's report, as a basis, has made u careful calculation, with the following result:— Earnings, 1920-21 season at present rates of freight— .£6,959,207. Earnings for eanio quantities at 1913 season's rates of freight, .£2,373,458. The increased earnings in 1920-21 are therefore ■£•1,585,749 (and not ,£5,113,202, as mentioned in the A. and P. Stock and Commerce Committee's report). The increased freight charges in 1920-21 are thus shown to be 193 'per cent, over 1913, while tho A. and P. Stock and Commerce Committee had before it evidence that the extrc. cost of running steamers (exclusive of establishment charges, depreciation, and' interest on capital on steamers built at high cost during or since the war) was 183 per cent. Extra charges for interest and depreciation on new steamers, for your information it may be 6tated, will, together with establishment charges, increase the running ■. cost' of steamers to well over 200 per cent., as compared with increased freight charges of 193 per cent. Under ilie circumstances this committee ventures to suggest that tho finding of the. A. and P. Stock and Commerce Committee is not warranted by facts.

As a result of the report by the Select Committee, overseas shipping companies have been unjustly criticised by the Press, and this committee • proposes to send a copy of this communication to the Press.—l have the honour to be, Sir, vour obedient,servant, NBA? ZEALAND OVERSEAS SHIPOWNERS' COMMITTEE. (Sgd.) James Findlay, Chairman. Wellington, November 3, 1920,