WELLINGTON NEWS

Hokitika Guardian, 19 August 1927, Page 4

WELLINGTON NEWS

THE SEASON’S RRO.Si’ECTS. (Special to “ Guardian.”) WELLINGTON, Aug. I°. We are at the beginning of a mnv icason, and each succeeding month nil!

see an increase in the output oi prlimtrv products until the peak is reached in January or February. It is the export of these primary products that measure tip the national income and determine the spending; power of the community. What then are the prospects for the new season;-' Indications point to a further increase in dairy produce, there* is likely to he sumo increase in the wool clip, and possibly the exports of frozen mutton ami lam') will’ expand. Hut will prices improve, remain at their present level, or tall lower.' The price problem is a difficult one to deal with. The general level of prices tin- world over has been tailing, even in the United States, flint land of limitless credit, there lias been tin average fall of 1(1 pec cent., aind mainly to arrest this decline the re-discount rate of the Federal Reserve Rank of New York has been reduced. Money lias been made relatively cheap and that means vising prices for the commodities measured by gold. Dairy produce in the season just closed did not realise just as good an average as in the previous year, but the increased production brought quite a little relief.

Will the prices of the current season on the average show any improvement on the last? That is really very doubtful. Prices to-day are tm higher than they were a year ago; they will probably rise and fall, that is inevitable, for the market must fluctuate. There is of course this advantage that the blighting hand of control will not he in evidence this season, and the market will be influenced entirely by the law of supply and demand. No one can forecast the movement of prices, but it teems probable that we will he fortunate if the average price is equal to that of the past season. The average may be slightly lower, if so it will accord with the world-wide movement of falling prices that has been noted during the past two years. The wool market looks very satisfactory, but those who believe wool prices are stabilised are perhaps deluding

themselves. However, wool has a wider demand than our other primary products, and a weak demand from one quarter is balanced by a strong demand from another. This was in evidence in the • marketing of the last clip. While Bradford and the United States were in the doldrums. France and Germany held tip values with their keen and persistent demand. Bradford still is dissatisfied and it is stated that wool is too dear for that market. The wool textii'e trade of Yorkshire lost heavily over the 19124-25 clip, and those losses have not yet been recovered. Bradford must buy and will buy wool, but Bradford will he sparing in her purchases and her attitude will tend to depress the market,. The outlook tor crossbred wool appears to be better than merino, because being the cheaper article it has a wider appeal to the impoverished European nations. The frozen meat market will depend upon what happens in the South Americau Republics of Argentine and Uruguay. The production of meat In the packing houses of Argentina rn 1926 was the lowest for three years with the exception el pork. Tilt* quantity of beef and veal produced for the twelve months totali'ed 1,924,570,00011), a decrease of 11.5 per cent compared with 1025, and exports of frozen and chilled beef were J .174.55U1b. which was about the same as those, for 1025, but S.l per cent less than in 1924. The exports of lamb and mutton at 110,486,00011), represented a decrease of 30.6 per cent. !

Some improvement was shown in the first two months of this year, I slaughterings of eg lilt} being 23 pei cent higher than for the corresponding period of 1926. while sheep killed showed an increase of 19 per cent. This improvement no doubt was the result of the higher prices offered by the,' packers. Generally it would seem advisable for New Zealand producers not to anticipate higher values, hut to en. | deavour to produce at a profit at the' cur.’oiit level of values. If prices rise I that, would ho so much to' the good. 1