WHEAT AGREEMENT

Hokitika Guardian, 14 September 1933, Page 8

WHEAT AGREEMENT

SOME PROBABLE BENEFITS. SYDNEY, September 5. It is with some Reluctance ,that Australia has .endorsed the wheat agreement recently, reached in London, for in the words of the Pyime Minister, Air Lyons, “any, arrangement which postulates a slowing up of Australian development of agriculture on normal lines is not one which can, be regarded with any degree of pleasure.” Others who are closely associated with the wheat position and are able to express expert,ppinion, sav that they see jn the. agreement both a compromise and an experiment open to many objections. To restrict production, of a food stuff in the face of much unsatisfied need for .food throughout the world appears to many to be a jnor.il ineptitude,, but at the same time paradoxical as it may seem, it may lie the quickest means of restoring some degree of efficient working to the world’s distributive system, and of restoring a general increase in purchasing power.

On the whole Australian official views are favourable to the wheat pact, for Australia is bound to benefit if the hope of increased, prices materialises.

Owing to the decreased harvest expected during the coming season the scheme will make no difference to the amount which would he extorted from the 1933-34 crop. Given a normal crop of 2,000,000, bushels in 1934-35 it might involve a loss of 3(1000,000 bushels of the export trade. Against that loss, however, would have to he calculated,anv advance in wheat prices which might arise from the scheme. A gain of Is a bushel would mean a. gain of £6,000,000 more than the total value of the -present price of the wheat that would be excluded from export. Estimates of the coming harvest submitted to the Sydney wheat Conference held in July, showed that it was rot likely to exceed 100,000,000 bushels,, which would he a falling-off of more than 40,000.000 bushels, compared with a normal harvest. In the circumstances, even if • Australia exported the whole ef her surplus, she would, still he 10,000.000 bushels within the restriction. Various suggestions have been made as to the disposal of any surplus in the 1934-35 season. The idea at the Svdnev Conference was to denature this wheat bathe addition of colouring or Partial crushing to make it unsuitable for milling. Experts agree that a broader market for Australian grain is likelv to result from, the agreement hut it is admitted that uncertainty in regard to Russia lingers. If the agreement prevents American dumping, if it affords control of Continental subsidised, whe-’t, and, if it effectually regulates Russian exports, then the prospects for Australia are bright indeed. Tt is not likely that the problem of long storage will h.-vo to be faced in Australia for at least two vears.