The Guardian (And Evening Star, with which is incorporated the West Coast Times.) WEDNESDAY, MAY 9th, 1923. LAND PRODUCTION.

Hokitika Guardian, 9 May 1923, Page 2

The Guardian (And Evening Star, with which is incorporated the West Coast Times.) WEDNESDAY, MAY 9th, 1923. LAND PRODUCTION.

Our Wellington correspondent’s letter published on Monday referred to an address by Mr W. D. Hunt, on tho subject of taxation delivered to the Dominion Executive of the Farmers’ Union. Mr Hunt commented on the great spending now going forward by local bodies of loan moneys, which, he remarked would “one day have to he paid for in wool, meat and butter.” The same issue of the paper contained a notice of a four million loan by the N.Z. Government. The ability of the country to pay is well worth considering in the light of some information compiled by the Mercantile Gazette affecting the freezing industry. The state of that trade suggests caution in public expenditure of money borrowed outside the country if the Dominion has to maintain the high state of taxation on land and companies as a prime means to raise the principal funds required for the people. But in any ease, the comments of the Mercantile Gazette are well worth conning over, as indicative of what is the state of the greatest industry of the Dominion in the matter of wealth and production, and the employment of labor. The paper says:—“Few people would believe that the freezing industry in New Zealand is overdone, yet such appears to be the case. There are

in the Dominion thirty freezing works of which 22 are located in the North Island and eight in the South Island. Twelve of the works in the North Island are farmer owned and four in the South Island, and these farmer concerns were founded for the purpose of “keeping up the price of stock,” and the guarantors of some of these concerns know what this means. The Auckland Farmers’ Freezing Company’s works at Horotiu, AAaikato, the Taranaki Farmers’ freezing works at Smart Road, and the New Zealand Alcat Packing Company’s works at Ngalisiiranga have not operated this season, except that the N.Z. Alent Packing Co., has been killing pigs for export its capacity in this respect being equal to 1200 pigs per day. The Feilding Farmers’ works at Knkariki were opened for a week or two and Chen closed down. Some of the other works will be closing down shortly nwinrr to the absence of stock. The qmunity of lieef slaughtered for export is negligible, but sheep and lambs arc important. During the past lour years the number of sheep in the Dominion decreased by about 4,000,000, and the extension of the dairy industry will probably cause a further shrinkage. Of course recovery is possible when fresh land is broken in, but that will take time. It is essential to the success of a freezing company that its works should he kept operating at full capacity, or nearly full capacity, if operating costs are to he reduced to a minimum. But so many works in the country, together with the shortage of stock, is causing trouble. Competition is going against the smaller and weaker companies. Outside of the proprietary concerns, there arc only two freezing companies that are doing well and that is the Gear Alcat Freezing Company and the N.Z. Refrigerating Company. This is evidenced by the favour in which iho shares of the two companies are held by investors. Their shares stand at a premium. The farmers are mainly responsible for the present condition of the industry. In their eagerness to “keep up the price of stock” the farmers have planted works all over the country not always with adequate capital, certainly with little idea of efficient and economical management. Because of the small turnover owing to tTio shortage of stock and keen eontpcfjiliou tin: operating charges are high and while present conditions last there .is no hope of charges being reduced. The Meat Control Board no doubt lias the power, for its powers are very wide, to order the closing down of some of these works, but the Board dare not take any such steps, for it would be. involved in claims for ccrnpensaticn. The Board lias no money to meet such obligation, its income is about- £20.960. aiul the whole of that money is required for office expenses, and the travelling expenses of the officials on overseas jaunts. A\ hat is likely t.» happen is that some cf the weaker concerns will go into liquidation. The New Zealand Meat Packing Coy. has gone into voluntary liquida'tion. The Taranaki Farmers’ Freezing Company is to consider the question of liquidation in the course of n lew days, if in the meanwhile it is found impossible to reconstruct the company.”