WILL PRICES DROP?

Manawatu Herald, Volume XL, Issue 1911, 5 December 1918, Page 1

WILL PRICES DROP?

FREIGHTS AND THE COST OF LIVING.

The armistice has been signed, freights are going down, peace is coming soon. Will war prices quickly disappear? According to the best-informed opinion in this city (says the Christchurch Press) prices generally will nut show a downward drop for six mouths to come at least; the great majority of importers anticipate that it will be nearer twelve months. It is felt, however, that prices have, in all but a few commodities reached their maximum limit, and that they will remain stationary until the downward tendency reveals itself. Except in a few heavy articles,-such as roofing iron, the reduction in freight which has been made has but an infinitesimal effect,.upon the cost of (he article, (ho conditions governing such cost being more those affecting the country nuTmifaeturing it, and the question of supply and demand.

The general opinion, further, , Ilia I commodities \vi!! never return to their pre-war prices. ! In the meantime, and shrewd havers anticipated matters weeks ago, local houses are adopting a conservative policy, and haying just sufficient for hare requirements, even if they have not ceased haying altogether. Even as it is, however, importers anticipate serious losses in some lines. In the meantime a veritable trade boom is expected, and this it is anticipated will work oft surplus stocks. Soldiers will be going hack into civilian life in their thousands, they will want clothes to wear, fashionable boots to put on their feet, find they all will have money to spend. In fact, for a brief while, some people say, there will be an orgy of extravagance. SO ST GOODS. The managers of leading soft goods warehouses express the opinion that it will he twelve months before there will be a drop in priees in drapery and other soft goods, freights exercising an inlinitesima! effect upon cost. However, most houses are adopting a cautious policy until (hey ascertain what goods have already been purchased on their behalf. One house has instructed its buyers to cease buying in the meantime; another has issued instructions to buy only for local requirements. The English mail which will he here presently will, however, probably make the position more lucid. Il is considered that the British Government will refrain .from loading its vast stores of supplies, such as blankets, etc., for fully six months to come, as an immediate loading might result in a trade panic in the Old Country at this critical juncture. Moreover, it is considered that the Allied Governments will require a larger proportion of these supplies from the British Government, apart from the requirements of Germany and her late allies. Though it is not anticipated that there will be any increase in most articles, (hough there will he an enormous demand for wool, as twenty million soldiers will require lo go into mufti, it is pointed out that there will probably lie a, hardening in cotton for some tune lo come. The cotton crop this year has been a partial failure. GROCERIES. Importers of groceries anticipate no drop in prices for. at least six months I I '(‘nine, some say twelve months. Here again freights do not make a groat difference in price. It is considered that in most lines tlie maximum price has been reached, hut some lines must rise, tea. for instance. During the greater part of the war the Germans and (ho Austrians have had to go without it. The Russians, a nation of tea lovers, have had lo forego the beverage, (he French and English have had considerably to curtail its use. Naturally there will he a great demand for it in those countries, with the result that prices should go up. Grocers are keeping stocks down, and buying conservatively, but they fear a heavy loss in some lines, as goods ordered twelve months ago have not yet come to hand. It was pointed out to TJie Press representative that whereas the. suppliers made importers liable for any increase in the rate of exchange and freights occurring after (lie sale, they made no concession for any reduction. Probably there will he a. few law cases fought over this question. FOOTWEAR. Boot importers are apparently not worried in this way. They believe that itVill be many a long day before footwear returns to anything like its pre-war level. The cause of this is stated to be the great scarcity of leather at Home. Leather, i it is said, will continue to rise in

price instead of going down, and this may refloat iiself in a corresponding rise in hoots and shoes. For months past not a hoot or shoe has been imported into this country from England. A small supply only has arrived from America, and importers have been relying upon the Australian market and the local article to replenish their supplies. Local shops have been working oJV Home stocks imported from twelve to eighteen months ago. An enormous quantity of fool wear is now imported from Australia, but the reduction in freights will have little effect upon its price. There may be. a slight reduction in sole leather, it is the leather for the uppers which is so scarce. HA RDWARE. It is (he hardware people who anticipate being hit hard by the reduction in freights. Up till recently up to £l3 per ton was being paid for iron, now it is £7 10s. That means a considerable difference. Luckily, so scarce has been the quantity of iron available, and so keen the demand, that stocks have been cleared out, as soon as they were landed. Some hardware importers have, unfurl limitcly, committed themselves to big purchases of goods rhe price of which will come down with a run. There is not the urgent necessity for people to buy these lines immediately, and it will mean that they will refrain from purchasing until prices come down, and the holder of large slocks secured at war prices will suffer. There is, however, considered to be no prospect of ironmongery being down for some time to (-oine, and articles composed of spelter, tin, and brass, will advance if anything. Again, pig lead readied its record prim l ihc other day.