Colonial News.
PRICE OF WHEAT AND FLOUR.
(From an Adelaide Paper.)
No question is of greater importance to every class of society in this colony than that of the price of wheat and flour. Every man, woman, and child has a direct interest in it. The growth of wheat in South Australia is
intimately connected, not merely with the domestic comforts of the people, but with their commercial solvency. On the remu-
nerativeness of our wheat crops depends our ability to import a large number of articles that we cannot raise for ourselves; in fact, it is impossible to over-estimate this branch of our colonial industiy. It is of the highest importance that sound views should prevail on a subject in which so many are deeply interested; and it is the more necessary to keep the question before the public
mind, inasmuch as there are obvious reasons; why a great antagonism of sentiment may prevail where there is no real antagonism of interest. This antagonism is simply the presumed contrariety of interest between buyer and seller. The buyer is anxious to reduce the profits of the seller to the lowest point, the seller is desirous of charging the buyer as high a price as it is possible to get,
and hence the idea that the dear loaf is good
for the farmer, and a cheap loaf for the general public. But, on calm reflection, the farmer will find that he may lose by high prices, and the working man may also find that there is such a thing as too cheap a^ loaf. In this colony our interests are all very closely identified, and it can never,pay one class to ruin another. The question, therefore, which we have to solve with regard to wheat is, at what price can it be grown to pay ? What is the lowest price that the farmer can afford to take, and what :is the minimum price to which at any time 1 it is likely to fall?
In the minutes of evidence taken before the Select Committee on Distillation, we find various statements with respect to the minimum price at which wheat could be profitably produced. Mr. Jas. Frew considered that, k' under ordinary circumstances, 4s. per bushel would do ;" but that with reduced prices of provision and labour, wheat might be sold " at even 3s. 6d., or a little less." Mr. A. H. Davis said—" I anticipate that in three or four years, with the mass of land we have under cultivation, and with good harvests, with the tendency of the neighbouring colony to supply itself, wheat will be down to 2s. 9d. per bushel, and interest of capital must come down in like proportion." Mr. John Fisher, of Gumeracha, being asked his opinion, as a grower of grain, on the subject of distillation, said— "If our grain could be distilled at a profit, distilleries would be established, just as mills are, in different parts of the country ;" and on being further asked what would be the minimum price of grain in the event of distillation being free, replied : " I should Suppose 4s. or ss. per bushel." In answer 'i»' another question, Mr. Fisher said: " Wheat at ss. per bushel is a paying price ;" and, in reply to further enquiry, he said : " If wheat was at a much lower price than ss. per bushel it would not pay the farmer." Mr. James Umpherstone, fanner, of Smithfield, being aske<l : " What is about the lowest average price at which the farmer could produce his grain so as to save himself from loss, taking a series of years ?'' answered : " I think from 3s. 6'd. to 4s. a bushel." The sum of the evidence given by these witnesses is, that ss. per bushel, or even less, would be a remunerative price to the farmer for his wheat. Five shillings per bushel for wheat would average £14 per ton for flour, at which price we need never despair of a market, for any quantity. With wheat at ss. per bushel, bread could be sold "at threepence-halfpenny the '2-lb. loaf—a price quite low enough to satisfy the utmost craving for cheapness ; so that if the evidence quoted may be relied upcn, it is perfectly clear that the growth of wheat in this colony may be cultivated to any extent, with profit to the farmer and at a price which no working man can have occasion to complain of.
But the question is whether, as the land is now cultivated, wheat can be profitably sold at ss. per bushel ? Farmers &ay it is a payingprice,and that even less would do ; but it may be that a considerable portion of the land in crop would need greatly superior cultivation to that now bestowed before wheat, with present prices of labour, could be sold at a profit for ss. per bushel. But at the same time it must be evident that an enhanced price can never be justified in order that inferior modes of cultivation may be protected. Better for the farmer to get a fair profit out of 6s. with good cultivation, than to get the same profit out of 7s. with bad cultivation.
The price of wheat, however, will depend not only upon the supply and demand of South Australia, but upon the supply ?.nd a'emand of South Australia with the demand of Victoria superadded. For years to come Victoria must be a bread-importing country. The extent of her importations may vary, and a feeling in favour of raising supplies within the province may influence the markets in a slight degree. But it is as impossible to persuade the working-men of the Victoria gold-fields to follow the plough's tail as it would be to persuade the farmers of Mount Barker and Macclesfield to devote their energies to mining at Echunga. In Victoria gold-digging pays better than wheat-growing, therefore they dig for gold. In South Australia wheat-growing pays better than gold-seeking, therefore they grow wheat. And as long as the Victorian gold-fields are profitable, so long will the
South Australian corn-fields be profitable too.
The wheat and fiour markets of Victoria is, of course, intimately affected by the importations from Chili. In the vast tracts of country at the foot of the Cordillera mountains an almost unlimited quantity of wheat can be grown. But it is quite an error to suppose that Chilian wheat and flour can be had at nominal prices. Nearly all the business at Valparaiso is transacted through merchants, who will not reduce the market to an unprofitable point. It must also be remembered that although there is plenty of wheat land in Chili, and notwithstanding that labour is cheap, the.system of farming pursued is of tiie most rune and ineffective character. We are not to reason as if the Chilian farmers combined the advantages of high farming and improved implements with cheap laud and cheap labour. They have the latter, but not the former; and are, consequently, placed so far at a disadvantage. The price of Chilian flour never ranges so low as to compete with South Australian wheat at ss. per bushel. The minimum price of Chilian fiour on board at Valparaiso is £10 per ton ; but no dependence can ever be placed by importers on getting it at so low a figure. The Chilian
market supplies not only the Australian" colonies, but to a considerable extent the English market; and prices at Valparaiso are ruled by prices at Liverpool and London. The charge for freight between Val-
paraiso and Port Adelaide is about £5 per ion; to which must be added £3 more for commission, insurance, risk of damage, warehouse expenses, &c, making £8 per ton expenses of bringing the flour from South America to this port. Under the more favourable circumstances, therefore, 'Chilian flour could not be sold in the colonies under £18 per ton ; but the average would probably be £20 per ton. The last cargo cost £25 per ton on landing ; and the whole history of the flour trade between the South American coast and these colonies proves beyond a doubt that there is no competition from that quarter which can give the South Australian farmer cause to fear. If £14 a ton, or even if £20 a ton, is a paying price for flour here, with a natural protection of £l resulting from proximity to the market, we must be unsuccessful indeed to be beaten.
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Lyttelton Times, Volume VI, Issue 377, 14 June 1856, Page 4
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1,404Colonial News. Lyttelton Times, Volume VI, Issue 377, 14 June 1856, Page 4
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