VALUE OF FARMING LAND

Hauraki Plains Gazette, Volume XXXIV, Issue 4556, 27 April 1923, Page 3

VALUE OF FARMING LAND

COMPARISON WITH OTHER COUNTRIES. STATEMENT BY MR. GOODFELLOW An important review of the position of the New Zealand farmer in relation to the price of land was given by Mr W. Goodfellow, managing director of the N.Z. Co-operative Dairy Co., Ltd., in the course of a largely attended meeting of farmers at Waihou recently. Statements had been made in the press recently, said Mr Goodfellow, by very able men, such as Sir Harold Beauchamp and other financial authorities, to the effect; that the price of land was too high and prices would have to come down. These statements had had a very bad effect, because lenders of money had been frightened by these statements, and were not inclined to be very liberal in their advances on farm security. In fact, he knew some cases where solicitors had been given instructions not to lend money on broad acres* but to invest it in the cities. This was a very swdous matter, because if the country was to progress it was very important, that financial facilities for development should be available, and it was, therefore, necessary to emphasise that sound land values,, were not, excessively high, and that farmers who farmed properly . could do very well even on land bought at comparatively high money. Those experts who had said that the price of land in New Zealand was ridiculous had apparently not t,aken the trouble to examine the position closely. From a dairy point of view the climate of the North Island of New Zealand was worth very much more from a productive point of view than that of Denmark, England, and the Continent of Europe generally. Experts who had gone into this question from the productive point of view considered that the climate of this part of New Zealand was worth £3O n acre extra compared with the competing dairy countries of the northern hemisphere. Dairying in Denmark and on the Continent of Europe was carried on under great difficulties. Wnen in Denmark he had been informed that a quartei of the fam area was turned up under the plough each year in order to grow foodstuffs for the cattle, which were housed in barns for six or seven months of ths year, because the pastures were buried under- snow in the winter. This heavy cropping and stall feeding added very considerably to the cost of holding cattle and the prime cost of production,, so that the estimate of £3O an acre for New Zealand’s climate was reasonable when it was considered that in the South Auckland province cattle were grass fed the year round, were never housed, and that rugging, even, was very little practiced. Another great advantage possessed by New Zealand/ said Mr Goodfellow, was her use of mechanical milking, in which respect she led the world. ’ In Denmark he had been told that there was one machine somewhere in the country, but nobody he encountered knew where .it was. Their dairy experts condemned milking machines and relied upon hand milking, which required one pair of hands for every 10 cows. Whereas in New Zealand a man and a boy with a milking ma} chine could effectively handle 50 cows, in Denmark it required at least ■ five pairs of hands.to do this milk- . ing, in addition to extra labour in the fields to provide winter foods. There was no chance of machine usage developing in Denmark, because of the small size of their herds and their use of barns. The value of land, continued Mr Goodfellow, was determined by the value of produce got from it. Since . the war the cost of production had been based on a permanently higher level than in pre-war days because of the general rise in prices* caused by the heavier taxation. He had seen rapid rises in the price of land in the Waikato. Land that he had seen sol i in ths Te Awamutu district for. £3 an acre was now actually worth from £4O to £5O an acre, and . the general tendency of the future would be for values to steadily increase as farmers got down to the basis of one-man . farming. Certainly some readjustment in extreme cases was taking place at the present time, said the speaker, but looking into the future he-felt safe in saying that a decade hence there would be very little land in the South Auckland district fully improved and in close cultivation that would not be worth very nearly £lOO an acre. The tendency in all dairy countries was to' work towards small farms. In Denmark 20 to 30 acres was the rule, and even in the dairying districts or America the areas were comparatively small. Under the condition of oneman Tarming interest on high values could easily be paid. He could cite a number of instances where men on . small high-priced lands were producing up to 2001 b of butter-fat per acre, and at this figure they could afford to pay interest on very high prices. It had to be remembered, said Mr Goodfellow, that high-priced land had acted as a very great stimulus to production. Under the spur of necessity the farmers in the South Auckland provincial district had in the last three seasons increased their production 2% times, and had this not been done pity people would have _ felt the pressure of the last few seasons very much more than they had. The farmer, therefore, by putting his shoulder to the wheel in this fashion, and sending forward that bulk of produce amounting to at least 40 1 ,000 tons this year from the South Auckland district, had produced a stream of trade and financial returns that, had reacted very beneficially to the cities. It was fair, therefore, to ask the cities to remember this fact and not strangle at its source that, stream of mortgage money upon which the country depended for its future development. Looking into the future, the speaker was inclined to be fairly optimistic. Of course, he said, what happened in Europe within the next few years would effect dairying in this country.

At present the clock of civilisation had been put back in Europe, and the possibility was that some countries would sink lower and lower and civilisation be thrown back for centuries. Experts admitted that it was difficult to say'when Europe would recover. When Europe did recover, she would be able to buy British manufactured goods, and thus increase British employment and improve the outlook for imported dairy produce. Economists stated that we were now entering upon a second period of inflation, and the prices of all commodities were commencing to rise. Periods of low prices were always followed oy periods of high prices, and the world's markets to-day justified the contention that prices were rising. On this outlook the next few years should return to the producer in New Zealand quite satisfactory and payable prices. To do that most effectively we must expand our markets and not depend entirely upon London. The huge market of America, the national income of which was greater than that of the whole of Europe, was open to us, and steps were being taken to develop that market as an alternative to the British market. He looked to the future with confidence, and felt that the dairying community as a whole had nothing to fear if they continued to improve their herds and to increase the carrying capacity of their farms.