FERTILISER INDUSTRY

Manawatu Standard, Volume LVIII, Issue 53, 31 January 1938, Page 2

FERTILISER INDUSTRY

MINISTER’S STATEMENT. DE-LICENSING QUESTION. HAMILTON, Jan. 30. In a statement issued to-day, the Minister of Industries and Commerce (Hon. D. G. Sullivan) replies to the allegations made by Mr A. J. Murdoch, chairman of the Dairy Board, to the effect that the Labour Government had de-licensed the whole of the Zealand fertiliser-manufacturing industry to overcome the difficulty which had arisen in connection with the Whangnrei application for a phosphatic fertiliser works. “My attention has been drawn to Mr Murdoch’s statement, which, in my opinion, warrants a reply as being a wrong statement of the position,” said Mr Sullivan. “Mr Murdoch says that his views are the ‘true interpretation’ of the position, but I would like to inform him that he has never been farther away from the truth. The actual reason why the industry of the manufacture of phosphatic fertilisers was removed from the licensing provisions of fhe Industrial Efficiency Act was that the industry—that is, the existing manufacturing units —could not agree to the provisions of the plan which was prepared by the Bureau of Industry in consultation with those manufacturers. This plan embraced features, some of which were originally suggested by the industry itself. “On the other hand, the Government, having in mind the interests of consumers could not. agree to the amendment of the plan as requested by the manufacturers, so that a continuance of licensing was not considered desirable. “The question of whether or not the proposed Whangarei works could receive a license from the bureau played only a small part with regard to my decision to delicense the industry. The application from Whangarei for a license to erect fertiliser works was only one of several similar applications from other places. Rightly or wrongly, the promoters were of opinion that they could supply fertiliser at cheaper rates than those now obtaining; and I could not see my way to give the existing industry protection against the starting of these proposed new units unless the industry was prepared to accept the plan which had been formulated in the interests of the farmers and the community as a whole.” NEGOTIATIONS OUTLINED. The Minister outlined the history of the negotiations, stating that the manufacturers had from time to time represented to the present and previous Governments their anxiety in regard to various proposals which had been made to establish these new works, being of the opinion that any such establishment without proper inquiry beforehand might result in the placing of the whole industry on an uneconomic basis. The manufacturers had asked for an inquiry by the Government, and the Labour Administration had decided to authorise this inquiry and provisionally to license the industry, pending the formulation of an industrial efficiency plan which would have for its object the proper organisation of the industry to the ultimate benefit, first, of the consumers, and secondly, of the industry itself. . . . The plan under discussion with the bureau and rejected by the manufacturers included provisions for the delivery of fertiliser to the farmei on a freight-paid basis in lieu of the present ex-works price system, said Mr Sullivan. The manufacturers did not consider that the price suggested tor fertilisers on this basis was a satisiactory one, the disagreement being in relation to the provisions for aveiage freight cost. The Government, having in mind the interests of the fainiing community, could not see its way to agree to a higher price to cover these costs, so that in the meantime the question of the adoption of a plan had to be deferred. “It Avill thus be seen that,Mr Murdoch’s interpretation is badly astray from .the facts of the position, said the Minister. “I personally regret that it was not possible for the manufacturers to accept the plan, as I consider its provisions would have reacted to the benefit of all concerned and would have achieved a greater measure of efficient organisation in the industry. “As far as Whangarei interests are concerned, they are in no way prejudiced by the delicensing of the industry. It is quite open for any interests, if they so desire, to erect a works for the manufacture of phosphatic fertilisers. The price of all such fertilisers is, of course, still fixed on an ex-works basis by regulations under the Board of Trade Act. The promoters of any such enterprise ivould themselves have to examine the prospect of successfully operating the works. i “I may mention,” concluded Mr Sullivan, “that, following representations made to the Government and to the Bureau of Industry, Cabinet has decided that co-operative dairy companies in the North Island are to be placed on the same basis as merchants in respect to the payment of commission on fertiliser sales. This is of particular interest to the North Auckland dairy factories and is a step which was never taken by the past Government, df which Mr Murdoch was a member, notwithstanding the fact that many representations were made to that Government. It was left to the Labour Government to adjust this anomaly, which has penalised dairy interests, particularly in the far north.”