LOWER PRICES

New Zealand Times, Volume LIII, Issue 12613, 25 November 1926, Page 4

LOWER PRICES

PRODUCERS’ DIFFICULTIES CHEAPER LAND ONLY REMEDY PROBLEM OF FINDING MARKETS The threatened era of lower prices and the effect upon New Zealand of the various commercial and industrial influences which are at present operating, were referred to by the president of the Associated Chambers of Commerce conference (Mr A. H. Mackrell) in his address yesterday. He dealt with the commercial and the productive aspects, and suggested a remedy. “The products of the land are to-day our chief source of wealth,” he said, “and we are realising at this very moment all too fully our absolute dependence upon oversea markets and payable prices for our exported products for the continued maintenance of our prosperity. “During and since the war each year one or other of our products brought highly payable This year we are faced with lower prices for the whole of our products. The values of wool, meat, lamb, butter and cheese are all receding to a level that renders it difficult for the farmer to make an adequate return for his labour and interest on his invested capital. CHEAP MONEY “For reasons known to us all, the discussion of which at this juncture would serve no good purpose, land m recent years went far beyond its true value, and there must be a substantial and earlv reduction of these values before farming can be made attractive and profitable. There is much talk of cheap and abundant supplies of money from farmers* banks or other sources to overcome the difficulties . of the farmer to-dav, but all this will be of no avail until land values recede, and the cost of production is brought to a point to allow us to compete profitably in the world’s markets. If this cannot bo done, we then cannot survive ns a country dependent upon primary products alone for its prosperity. “Science can and is helping us. Increased production, more intensive cultivation, closer settlement, high quality in otir products, will all assist, and a period of lean times will do much to force us to realise this, but we also need capital for this purpose, and that capital should be available from the profits of the land rather than borrowed. VALUES TOO HIGH “Our present difficulty in this direction is—banking and other financing institutions are disinclined to lend where values representing their security are too high, and the, profits being made from farming aft not sufficient for the application of scientific methods in our farming industry. Even if these difficulties can be readily overcome, are we wise to continue only as a country producing what is known as primary products and raw materials? “This brings me to a point where I Believe New Zealand must seriously and earnestly consider the importance and relation of what are termed secondary industries to our primary industries, and the continued expansion of the Dominion. “Men, money and markets are all necessary to our development. We need greater population; we need capital with and for the greater population, and we need markets for our products both primary and -econdary. Home markets are the best, because they are at the door. The difficulties of high transport coats, exchange rates, and competitive marketing are avoided in our home markets, and a higher re-

turn in comparison with retail values can be made to the producer. INDUSTRIAL DEVELOPMENT “New Zealand with a population of 1,400,000 consumes 15,000 tons of butter each year, equal to one-fourtli of our annual export. If we doubled our population we would consume 30,000 tons of butter per year, equal to half of o«r present annual export, and 90 tli© j>roblem of finding markets for butter and all ether produce of the land to which this comparison applies, would he lessened. Population in this country cannot be greatly increased without the establishment of our secondary industries. Industries cannot be established or developed without capital and markets. By developing industries we will give emploj'ment to a greater population and so will increase that most valuable of all markets, the home market.”