COMMODITY MARKETS AND PRICES.

Manawatu Standard, Volume LX, Issue 252, 21 September 1940, Page 10

COMMODITY MARKETS AND PRICES.

AGRICULTURE AND WAR. (By “Penloo.”) The Nazis’ pre-war policy of building up a war machine at the sacrifice ot agriculture and food supplies made Germany weaker and weaker in food supplies as she became stronger in arms. Marshal Goering gave expression to the policy when he told the German people that “battleships were better than butter.” .Mobilisation immediately intensified ail influences detrimental to Germany’s commodity security. The agricultural man power position, already difficult, became acute as hundreds of thousands of farm workers were taken away to fight. Important imports previously cut down ns a result ot the war plans were now cut off altogether by the Allied blockade. Supplies of fertilisers and of oil for tractors, and all the other material requirements of agriculture, were, cut down. So some further decline in agricultural output was inevitable. Germany’s difficulties have been greatly increased by the severe winter of 193940, and a late spring this year. This has had the effect of not only seriously damaging cereal and potato crops in that country but also of damaging crops- of Germany’s neighbours in South-Eastern Europe on which Germany councils for an important part of her supplies. The pasture has been late in recovering from the winter, so that cattle have been kept inside still longer than usual, consuming more of scarce feeding stuffs. The floods which followed the frosts and snow have been similarly damaging. Furthermore during the eevere spell transport was held up and supplies from the Balkans were checked and domestic produce perished. This combination of causes has led to the spreading of disease. Both among livestock and among crops. Moreover, hopes of substantial supplies of feeding-stuffs from Russia have proved vain. Actually, therefore, the development of food supplies has become more unfavourable as the war proceeds, partly from causes inseparably connected with the effects of and partly fortuitously. The position is likely to be worse, because the reserves of the resources of German agriculture have been seriously depleted. Tho German farmers cannot work any harder than they have been doing under very difficult conditions.

Thus a position threatens German agriculture in which stocks of grain must bo used op dangerously fast or animals will have to be slaughtered for lack of feed-ing-stuffs. In this situation, in which the food supply 'has to bo fostered with great care, the big German offensive began, and Norway and Denmark, then Holland and Belgium, and then France, were invaded. The Germans saw these offensives incidentally as a means of securing new food resources. In all these countries there were stocks of food—cereals aild an important live-stock population. The German troops descended on these countries looting their resources just as they had looted those of Poland. These neutral countries had been allowed by the Allies to build up resources of imported food and feeding-stuffs in preparation for the blockades which they believed would come. Such resources have been ruthlessly pillaged by the Germane. That the invasion of these neutral countries was for the purpose of obtaining food supplies now seems very clear, but it can be only ,a temporary benefit to Germany. . .. The immediate food situation in German v has to some extent been eased. In. the Reich itself there are new supplies—for a limited period—at the cost of impoverishing the invaded countries, of Europe. But this extension .of military power will nevertheless recoil on Germany. These Western European countries depend on imported supplies.. None of the newly-acquire<l territories, including France, is self-supporting in foodstuffs or feeding-stuffs for stock. Thus, whei’cas Germany previously was able to get food from these countries (except France), now these sources of supply arc cut off. Once the looted stocks are exhausted and that cannot be very long, these countries will become liabilities instead of assets. The blockade stops all imports into the invaded countries and now they must feed themselves and their live-stock as best t-hey can. They cannot get any help from Germany for the latter has nothing to give and is herself in a parlous state. Tho piain truth is that starvation is the lot facing manv millions of people in Europe, and this is likely to develop a new and difficult situation. Starving people will not remain passive; on the contrary, they arc likely to adopt violent measures to appease the pangs of hunger. The methodical Germans always provide themselves with an alternative,, as m the case of the invasion of neutral countries, to replenish food stores; but 1 what is the alternative now? Tho British blockade has been tightened, and there is little if anything getting past the British Navy. The Navy - itself has been strengthened by the acquisition of the 50 American destroyers. Hitler’s job is to break tho blockade—invasion of Britain would mean that—and the blockade must be broken quickly, or at least boforo the winter descends on Europe. Hitler is powerless to break the blockade, much less to invade England. Tho most lie can do is to continue the ’ air attacks and the spasmodic dropping of bombs, killing women and children. He may try gas attacks, but even that will not help him. I lie German plans were successful on the Continent, but they are breaking down when tried on the British. When winter comes, and Britain remains mistress of the seas, then Hitler’s troubles will become much greater. Even the Germans will be placed on starvation rations. .Germany is beleaguered, and may be forced to sue for peace because of this. “L wasting the lion’s tail” and challenging the British Empire can never be profitable to any country. In this war time is on the side of the British, who grow stronger each day. When Germany is exhausted Britain will be able to strike with full strength and give powerful blows. The outcome of the war cannot he in doubt, but what is to follow is engaging attention. It is impossible to take an optimistic view, especially of the immediate post-war period. The adjustments that must be made will call for the closest co-operation between the nations. One thing is certain— commodity prices will be on a lower level. Countries with high costs will feel the position and they will have to fall into line and bring down costs If the immediate post-war period is surrounded with serious difficulties? a long-range view warrants optimism. Iho world's economy will bo re-established on •i stable basis, which moans that it. must jettison the new-fangled ideas of ' controlled economy and hark back to the old and well-tried economy of private enterprise.