THE BREADSTUFFS AND PRODUCE MARKETS

Otago Witness, Issue 2815, 26 February 1908, Page 21

THE BREADSTUFFS AND PRODUCE MARKETS

J<n<i-ay Not for the first time in its history the wheat market has gone right in the face of statistics, anticipations, and every other known reason. In place of an expected rise in prices we have to record a decided 6lump in Mark Lane, the beginning of a downward movement which appears likely to continue. London advices at the end of last week reported the wheat market weak owing to the continuance of heavy shipmenia from -A-t*rerioa arul -fctie .A-rg-exxtine, while buyers were disinclined to operate in face of the prospect of lower prices. South Australian cargoes loading were quoted at ! 38s. This evening a cable from London re- ■ ports wheat 6d per quarter lower on the : week, which brings the prioe of Australian | caigoes down to 37s 6d. The position is an i extraordinary one, as we shall proceed to show. America had more than exported her surplus at the beginning of the year — , that is, if the official estimates are to be depended upon, — and early in January had i considerably depleted her reserve stocks. .Since then the shipments from America and ! have been enormous, and still there is no ' indication of any lessening of supplies. Assuming that America and the Argentine are able to continue the present rate of shipments and between them supply the English and Continental demand _ for the next six or seven weeks, the growing crops will then begin to be in sight. The course of prices will then be determined by favourable or unfavourable crop repots. But whatever happens in the matter of the i harvests, whether the yield promises well or ' ill, one thing is certain, that the new wheat season will open with the world's carryover smaller than probably it has ever been before. Thus, although the present trend of prices is decidedly downward and apparently is likely to continue, yet it must not be forgotten that at any moment there may be a sudden alteration in the aspect of the markets, and this probably wihen It ie least expected. The position is accurately enough, summed up by the Australasian as follows: — About two months hence the condition of the growing crops in Europe and America will begin to influence the market, and, if the autumn-sown crops do not look well, or if any delay takes plac« in effecting spring Bowings, the markets may, t* disturbed M

j stocks throughout tho world ate smaller Q than usual. On the other hand, if the crop y reports are favourable, the markets will prog bably work smoothly, though when harvest t time arrives in Europe and America stocks t will probably have fallen lower than usual. j Something will depend also upon whether s the harvests are early or late. 3 The following statement of the case, by . "Beerbohm," dated London, January 10, is 8 well worth studying, especially the Amerij can figures, which furnish the explanation i of the present position: — The past week has witnessed a fair amount j of animation in business, but prices are not f easy to maintain in face of the favourable 1 crop reports from Argentina, and the conr linued enormous output of wheat and flonr t from America and Canada, the probability . that there will be little or no wheat from r India this year, and very restricted supplies 3 from Australasia being lost sight of iri the j contemplation of these present facts. There ' is, however, another way to view these large I American shipments, without which Europe , would indeed have been in a parlous state in \ the matter of supplies during the past three I months j in the past four weeks, for instance, ' America. «nd Canada have gent to Europe . no less than 2,570,000 quarteis out of a J total shipped from all countries of 3,460,000 s quarters ; thus nearly 75 per cent, is the J proportion from America and Canada , but does not this indicate extreme scarcity in | other countries, apart from America ? In view of the fact, however, that a veiy big Argentina crop is mow assured, with a pos1 sible surplus of 16,000,000 quarters, compared with 13J million quarters last year, the '■ trade is asking itself how long these large ■ American shipments can continue, it being reported that an important decrease in these i exports will be the sequel for renewed strength and activity in the market. The question is not easy to answer, but if the ■ official estimate of the last^ American crop can be relied upon the surplus from that crop has already been exported, and a considerable inroad upon the reserve stocks carried over from last season has also already been made. The following comparison of the American crops -and exports (official figures) may help our readers to form their own conclusions in this connection, the figures are bushels 000 omitted- — : Amekican Crop and Exports. i Exports

• In Australia, the Melbourne and Sydney markets have fuKy maintained their position, this -week's quotation, 'being — Melbourne 4s 3d, Sydney 4s 4d. In Adelaide, j in symipathy with the drop in Mark Lane, i the quotation has receded' fully 5d per bushel, and now stands at 3s 9d. The explanation of this disparity is that practically the whole of the estimated surplus in the Commonwealth — some 20 million bushels — I is in South Australia, in Victoria and New South Wales tthe yield being barely sufficient for home requirements, the markets have a tendency to take an independent course. The following extracts from the latest Australian files to some extent explain the situation : — The market for breadstuffs (reports the Sydney Mail of 12th inst.) continued qiue.t so far as actual business was concerned. Millers appeared to have their requirements pretty well supplied and , wr>re holding off in the belief that they might probably be ', able to replenish stocks at below ruling rates. While, however, there is no export ■ "trade in flour they are not likely to go in for extensive buying, there being on hand more than sufficient flour to meet the inter- I nal demand. The sooner the mills can revert I ' to full time working, and the sooner the I markets abroad will permit of a revival of i an export trade, the better it will be for all I 1 engaged in the industry. Meanwhile, all 1 markets are being watched. Growers, having ' long since realised the treachery of wheat, now endeavour to judge the world's outlook for themselves. They are, in many instances, prepared to hold on to their stock* when even pressed to accept ruling rates. Some declined to sell when the price was 4s 9d. It so happened that they were wrong, but there must always be a last man on top. Others j sold at the first indication of the fall, and ; thus avaided the further decline. The class • of growers who are now holding back are those who missed the market — and are hoping to catch it again. Millers, however, lightly or wrongly, incline to the belief that there ■will be a lower rate yet. During the week buyers had been prepared to do business at 4s 4£d per bushel, about 5000 bags being picked up in the country at an equivalent to this price. Many sellers were, however, ask- i ing 4s 5d per bushel. Tenders received today by the Scottish Australian Investment Company (Limited) for 20,200 bags of wheat, stored at flenty, Marrar, and Ganmain districts, should test the level of the market. The estimate of the South Australian harvest by the Adelaide Register (20,720,000 bushels) Is rtruch larger than earlier estimates. On this basis the Commonwealth crop may be summarised in comparison with the previous season as follows : — j

Tota] •• •• 66,100,654 46,220,000 The total Commonwealth crop for the pie-

r sent season, about 46i million bushels, leaves an cxp-oi table surplus of about 20 million bushel-- — after providing for an Australian consumption for the season. Shipments have already been made to the extent of about 4.000,000 bushels, and vessels chartered and i in course of loading will account for about ; 3,000 000 bushels, making a total of about seven million bushele, the export of which is provided for After -this is accomplished, the Australian surplus will be reduced to about ; 13 000,000 bushels. The Melbourne market (reports the Aus- ; tralas an of 15th inst ) has not shown much I activity. The demand is limited for the I same reasons that have been at work for some weeks past, as the present level of prices is too high for shippers, while millers are unable to do businjdss in flour for exj poit, owing to the dearness of wheat. The [ demand is consequently limited to millers' ' | requirements for local consumption, and as , bakers are fairly well supplied with flour, I business is slow. Later in the year, when ! farmers become more willing to sell, a readjustment of prices on the basis of export I values may be looked for. but at present it appears probable that the process will take some time. Quotations are rather wide, small lots being quoted at 4s 2Jd, and fair-sized parcels at 4s 3d nominal. j The local wheat market is inactive, the 1 news from London inclining millers to hold 1 off the market in anticipation of lower prices. The sale is reported from Timam j of a line of 1000 bushels of Tuscan at 4s ' delivered at mill door, while there arc plenty of lines offering- at 4s Id on trucks. Buyers expect the price to settle down on the basis of 4s on trucks. Sales were made ar Waimate yesterday at 4s o.n trucks, and while no actual transactions have yet taken ! place in the Oamaru market at that price, it is expected that 4e on trucks will be 1 established as the market rate to-morrow i (Saturday). Millers, however, having provided for their immediate wants, are inclined to wait a while in the hope of the n;arket receding to 3s lOd or even «5s 9d on ( rucks Should prices come back to that i level buying would probably become general. Throughout the Oamaru district the yields are disappointing, many of the main crops threshing out fully 10 bushels to the acre Jess than was anticipated. Growers who oxpeeted 40 bushels to the acre are only petting 30 bushels, and this experience is fairly general. This, eoup'.ed with the short acreage and the absence of a carry-over, .points to the probability of another- wheat shortage before the end of the season. Thus wheat at 3s 9d, or even 3s lOd, on trucks may Tempt speculators to operate and bold for a rise later on. There is little demand for chick wheat, , and orders are being filled- with old wheat , at from 4s 4d to 4s sd, ex store. A shipment of Austarlian flour, reported to have cost £8 10s f.o.b. Melbourne, was I landed to-day in Dunedin, and it is j rumcured that there is more at the same price on the water. This works out as costing about 10s per ton less lihan the local article. The directors of the New Zealand Flourmillers* Association, however, i have not made any alteration in the tariff, ', which stands as follows: — Sacks, £11 ss; j | 100's, £11 10s ; 50's, £12 ; 25's, £12 ss. The I shipping price is £11 per ton, and the Invercargill price £11 10s. As showing the improbability of any quantity of flour coming to New Zealand from Sydney or Melbourne, the following I dippings from. Australian reports are cf ' interest: — ' As milling wheat is chea-per (cays the , Town and Country Journal) in Victona and South Austiaha than in Sydney, the Melbourne and Adelaide millers have been bent on underselling Sydney in flour. It has, therefore, been decided to reduce the quote for best Sjdney i oiler to £10 a ton, being a. drop of 10s. This price is not lucrative, but ' will keep the Sydney tra.de together | In the absence of any export trade (reports I the Sydney Mail; no special deals in flour i have been made. In supplying the internal demand, chiefly bakers' requirements, city millers have been asking £10 to £10 10s per ton. Country millers have been selling in small lots at from £9 10s, the best old country makes fetching £10 10" The market J generally has been dull, and, judging by { millers' stocks, it is likely to remain ao. | Cables from London repoited the market there as quiet. The exports of flour 1 fromi Sydney for the week ending I February 8 totalled 4911 sacks (2001b ! sacks), 180 being for the United Kingdom and Continent, 1977 for Xew Caledonia, 1000 for the. Philippines. 1426 for Singapore. Java, etc., 657 for South Sea, Island*, and 170 for New Zealand. The association basis for ordinary trade parcels of town flour is £10 delivered (reports the Australasian). The demand ib slow. Inquiries for «xj>ort continue to be received, but the prices offered are generally too low, ! millers being hampered by the highei cost ' of wheat ruling in Victoria than in South I Australia. ! There is no alteration in offal, and the association's tariff stands: — Bran, locally £5 ss, and for shipment £5 f.0.b. ; pollaid, | £6 per ton both for local order* and for shipment. In the oat market buyers are still awaiting the coming on of the Southland crop, which is longer being harvested than was anticipated. There is only a 6mall business doing, chiefly to supply millers' demands, at from 2s to 2s Id on trucks. The current quotation for feed oats for immediate delivery is from 2s 3d to 2s 3£d. f.0.b., s.i., and a limited business has been done for March April delivery on the basis of 2s 3d f.0.b., e.i. But up to the present the deliveries are small, and the actual position of the ' market will scarcely be disclosed until the ' pressure to sell begins. At present there ,

j is no demand from the north, Auckland buyers deciding to await developments. And although some inquiries are to hand from Australia, nothing has transpired in the way of business. Invercargill mcri chants are prophesying a drop in prioe, and hint at le 9d to Is lOd f.0.b., s.i., as i the probable bottom of the market. But i whatever be the ultimate future of prices, | there is a possibility of a firmer feeling as next month progresses and deliveries I to fill forward, contracts have to be made. | That pinch once past the further trend of prices is extremely uncertain I The price of oatmeal is unchanged at £13 per ton. Latest reports from Akaroa. report an extremely film cocksfoot market. On» result of the bush files in the north has been to strengthen tEe already keen demand for the North Island, and buyers are willing to pay up to 6Jd f.o.b. Lyttelton or Akaroa for 131b to 141b seed. The bulk of the available seed, however, is in growers' hands, merchants' stocks being largely depleted, and the growers are stipulating for bd. This means that North I leland buyers will have to advance to 6id in order to supply their needs. At present ' there is a keen inquiry, but no offerings, at current rates. The seed this year is so : fine and clean that it is going into consumption in an undresed condition. Thi9 moans tha.t the usual lose in cleaning of from 15 to 20 per cent, will be saved. Thus, estimating this year's yield at some 40.000 sacks, it will be equal to, say, 50.000 sacks in an ordinary year. The potato market is a shade easier. Peninsulas are selling at from 6s 6d to 7e, and northerns from £5 ss. , Butter. — Latest cable, advice shows that large arrivals have steadied the London, butter market, and there is a general impression that the market has reached the> top. Local quotations, which are, a shade firmer than last week, are as follow : — Dairy pats and dairy bulk, 8d ; separator pats. 8d to lOd; separator bulk, 9d to 9£d;' milled— first grade 9id, second grade 8jd ;i first grade factory prints. Is ojd : bulk. la. Cheese.— Factory mediums, 6d to 6£d ; Akaroa loaf, 5Jd to 6d ; medium, s£d to> 6d. Egge, Is Id per dozen. Quotations for poultry are as follow : — Hens, 2s to 2s 9d per pair : roosters. 4s to ss; goslings. 56 1o 6s: ducklings, 5s 6d to 6s: ducks. 4s to 4s 3d; turkeys— hens sd, gobblers 8d to 9d. Bacon pigs arc quoted at s^d ; bacon, 9d ; porkers, s^d per lb. The market is fully supplied with chaff. New season" % is quoted at £3 to £3 s°. The highest price obtainable for prime old oaten sheaf 16 £4 per ton. IMPORT MARKET. The seeded raisin market, is reported to bo easier in San Francisco. Stocks are known to be short theie, and it is suppo-pd that th? easier tone of the market is the

Victoria South Australia, .. New South "Wales Western Australia -„ Queensland and Tasmania ." 1906-7 Bushels. 2-2,618,043 17,145,796 21,817,938 2,758,567 1,760,310 1907-S. Bushel 3. 12,322,000 20,720,000 8,686,000 3,492,000 1,000,000

1907-8 1906-7 1905-6 1904-5 1903-4 Crop. 635,000 735,000 695,000 552,000 638,000 July 1 to Jan 1. 96,000 82,000 ' 53.000 25,000 81,000 Exports for season. ? 148,000 97,600 44.100 121,000