WILL PRICES DROP ?

Hokitika Guardian, 20 December 1918, Page 3

WILL PRICES DROP ?

I FREIGHTS AND THE COST OF LIVING. ! NO IMMEDIATE REDUCTION n ANTICIPATED, r ! [j The armistice has been signei freights arc going down, peace is coi ing soon. Will war prices quickly di 1 appear? According to the best iuforme [1 opinion in Christchurch prices will m f show a downward drop for six month o to come at least; the great majority i s importers anticipate that it will be nea ly 12 months. It is felt, however, thn ' prices have in all but a low eomint 1 ditios reached their maximum limit, am 3 j that they will remain stationary unti ■ the downward tendency reveals itsoli l Except-dri a few heavy articles, such a : roofing iron, it was pointed out to i j Press representative, the reduction ii , I freight which lias been made has bu ■ an infiinitesimal effect upon the cost o are article, the conditions governinj such cost being more those affecting tin country manufacturing it, and the ques tion of supply and demand. The general opinion, further is that commodities will never return to theii pre-war prices. In the meantime—and shrewd buyers anticipated matters weeks ago local houses are adopting a conservative policy and buying just sufficient for bare requirements, even if they have not ceas ed buying altogether. Even as it is, however, importers anticipate serious losses in some lines. In the meantime a veritable trade boom is expected, and this, it is anticipated, will work off sur- ! plus stocks. . Soldiers will lie going I back into civilian life in their thousands, they will want clothes to wear, fashionable boots to put on their feet, and they all will have money to spend. In fact, for a brief while, some people say there will be an orgy of extravagance. SOFT GOODS. The managers of leading soft- goods warehouses express tho opinion that it will be 12 months before there will he a drop in prices in drapery and other soft goods, freights exercising hut an infinitesimal effect upon cost. However, most houses are adopting a cautious policy until they ascertain what goods have' already been purchased on their behalf. One house has instructed its buyers to cease buying the meantime; another has issued instructions to buy only for local reqiremonts. The English mail which will be here presently will, however, make the position more lucid, j It is considered that the British Goveminent will refrain from unloading its vast stores of supplies, such as blankets, etc., for fully six months to come, ! as an immediate unloading might result in a trade panic in the Old Country at . this critical juncture. Moreover, it is ( considered that the Allied Governments will require a large portion ot these supplies from the British Government, apart from the requirements of Germany and her late allies. ’1 hough it is not anticipated that there will he an enormous demand for wool, as twenty million soldiers will require to go into mufti, it is pointed out that there will probably be a hardening in cotton . for some time to come. The cotton crop this year has been a partial failure. j GROCERIES. j Importers of groceries anticipate no* drop in prices for at least six months j to come, some say 12 months Heie again freights do not make a great dif- - ferenro in price. It is considered that j in most lines the maximum price has j been reached, but some lines must shou j a considerable advance. Take tea, for instance. During tlic greater part of I the war the Germans and Austrians liav had to without it. The luis- , sinus, a nation of tea lovers, have had , to forego the beverage ; French and Eng- | lisli have had considerably to curtail its i use. Naturally 'there will be a great demand for it in those countries, with j the result that prices should go up. Grocers are keeping stocks down, and j buying conservatively, hut they fear a , lieavv loss in some lines, as goods or- r tiered 12 months ago have not vet come ; to hand. It was pointed out that whereas the suppliers made importers j liable for any increase in the rate of ex- j change and freights occurring .after the i sale .they made no concession for any , reduction. Probably there will be a few law cases fought over this question. FOOTWEAR Boot importers are aparently not worried in this way. They believe that it will be many a long day before footwear returns to anything like pre-war level. The cause of this is stated to he ; tlie great scarcity of leather at Home. . Leather ,it is said, will continue to rise j in price instead of going down, and this may rotiooi itself in a uorrospoiicling rise in boots ancl shoes. For months past not a boot or shoe has been imported into this country from England. A small supply only has arrived from America, the importers have been relying upon the Australian market and the local article to replenish their supplies. Local shops have been working olf home stocks imported from 12 to IS months ago. An enormous quantity of footwear is' now imported from Australia, but the reduction in freights will have little effect upon its price. There may he a slight reduction in sole leather; it is the leather for the repairs which is so scarce. HARDWARE. ft is the hardware people -who anticipate being hit by tho reduction m freights. Up till recently up to £ld per ton was being paid for iron, now it is £7 10s. That means a considerable difference. Luckily, so scarce has been the quantitv of iron available, and so keen the demand, that stocks have been cleared out as soon as they were landed. Some hardware importers have unfortunately committed themselves to big purchases of goods the. price of which, governed largely by freights. will* come down with a run. There is not the urgent necessity for people to buv these lines immediately, and it will mean that they will refrain from purchasing until prices come down and the j holders of large stocks secured at win prices will suffer. There is. however considered to be no prospect oi ironmongery being down lor some time L come, and articles composed of spelte t tin and brass, will advance, if an\ thing. Again pig lead reached- its re cord price the other day. TIMBER. Many owners of houses have in recon months been putting a fancy figure oi their properties and holding on, coni: dent that sooner or later they would sc cure their price. With the presen price of timber and other materials, ' , looked a safe thing to do, but the r< i j duct ion in freights alters the aspect cot 1 siderably: It lias already been potnle i r 1 out that there will be a heavy mluctio f* in iron ancl timber, though they do nc think timber will ever go hack to its pi v 1 war price. What litis caused the pr r sent fancy price is the heavy Australia 0 importation. Before the war Austral r imported Oregon extensively from Am 1 ! rica. and practically neglected the Nc d Zealand market. The heavy freigh finally forced Australia- from furtlu I American importations and to turn to tl Dominion. Result: A timber boon this country and a rapid and heavy i 0 crease in prices. Now with tho r . v duct ion iu freights, Australia will r turn to the American market, and Nc io Zealand will practically have only i d home market to supply. J. t

MOTOR CARS. Motor importers have gloomy forebodings of what is in store for them in the immediate future. Freight enters largely into the cost of motor-cars and their accessories, and the reduction of freight means an immediate reduction in the cost of new cars shipped. This must mean a corresponding reduction in the price of the cars, and accessories already in store. Some garage owners, however, take a more optimistic view of things, believing that it will he 12 months before a big drop takes place now ing to the heavy European demand.