FROZEN MEAT MARKET

Otago Witness, Issue 2895, 8 September 1909, Page 39

FROZEN MEAT MARKET

AN OPTIMISTIC VIEW. Mr John M'Queen, managing director of the Southland Frozen Moat Com-pany, holds a very different view from those which ha.ye been recently expressed in ths north regarding- the future of the meat market. This view, supported by his reasons, lie gave to a Southland Timee representatiTe who interviewed him. In dealing- with the reasons for the Tecent glut Mr M'Queen stated that one etrong factor was the large importation of mutton from Holland. • Th© reason for this umisual and rather unexpected competition was that Holland had experienced an abnormally fine summer and winter, with an almost continuous growth of grass", and ihe effect was a big eurplus of fat sheep, for which practicafly the only market was London- There "was at the- be«iuning: of the eeason in' London a certain holdover from the previous 9-sason in store. When the Dutch mutton went on the market it entered, into comptaitoin with, the Australian " heavies,"' which -came in at the «amo time, and a bad market resulted for the frozen, meat. Thinking that the market would improve, the exporters £9nt the meat into store .to wait for the rise that didn't come. They went on storing till, by-and bye, the stores bocame glutted with mutton and Jamb. Then as it came forward, ar.-d as there was no further storage room, the e-xporters 'had to sell at anj price. The result was .that the prices ,wero forced very low. It was a!so proVable, Mr M'Queon thought, that large meat merchants who had big interests in the stores cried " full 6tores " before the stores wer? actually fully tax-ed, and thus forced exporters to sell to them at whatever th*y could get. because these merchants, liaving control of the storage., were the- only pe-TSons who were in a position to buy any quantity. He was of opinion also .that several of thei-e merchants did not. profit by this procedure, because the riss expected when the stores actually were full did not come. Speaking of the conditions precedent to the overstocking of the market. Mr M'Queen stated that there wa3 a much larger number of sheep forward this season from the various shecpexporting countries than was usual. The only reason he could advance for that was. as in the case of Holland, the unusually favourable climatic conditions that everywhere prevailed. New Zealand had an early and good sea?on. Australia .did not have a very big output, but there was a great increase in the Argentine exporr. •In Argentina there had been a drought. It was frequently th& case in South America that they had too great a giowth of grass for fattening purposes. It had •been discovered in New Zealand that the greatest difficulty was experienced in fattening sheep when the gra«\s was long and rank, as it was too soft and not sufficiently nutritious fcr fattening. Consequently a dry season was in the Argentine, as in Southland, much more advantageous for sheep-farming purposes. The effects of the drought in South America would operate in the direction of export for two probable reasons firstly, the sheep would ibe more easily and quickly fattened, and, secondly, holders, in consequence of th» shortage of feed consequent on the drought .would be keen to -reduce their flocks, and the only way in which to do this without loss would ba to sell the fat stock for export. Reverting to the state of the market in London, there was. in addition , ito the large inflow of meat, the depressing faotoT of slackness in general trade, and |un«mployinent among- the working classes; /the people who would most likely be the largest consumers of frozen- meat. Had ■the same number of sheep gone into a strong purchasing market there would have jbeon a seanous reduction in price, but that jresult was tliis year accentuated by the coincident weakness in the purchasing ; ;po-wer of the market owing to trade slackness. j As to the prospect ahead of the frozen toeafc industry, Mr M'Queen stated that on Jgeneral grounds there must be a recovery, [as the conditions attending' the recent fciluinp were abnormal. There was an abnorJmal quantity of meat Bent to London, and ,'it went on the market at a time when Jgenwal trade -was not prosperous. The Jupply of muttoh and lamb must come back Jx> tiprmal size, while trade and industries Vt Home would recover their balance, and jthe consequent effect Six the meat market ground be higher price!. Apart from this, $f{ 'M'Queen, had more particular reasons

for optimism. He pointed out that both J Argentina and Australia possessed enor- j mously large stock-raising areas, and that it ] was well known that for a number of years these areas had been understocked — Argentina in sheep as well as in cattle, and Australia particularly in sheep. Also, these countries had outlets for their stock apart from exporting. The grazier in Australia was an important factor in the question. The price that the freezing buyer or exporter could give to-day, in view of the present state of the rtarket at Home, was such a low one that, the farmer would not export when he could probably get a higher price at the farm from the grazier. Australia could carry, and had carried, a great many more sheep than it did to-day. There i had been a very fine season there, giving . plenty of grass, and the result would be j that now that the grazier could get sheep cheap he would stock up. And the curreni high price for wool would operate further in this direction. To a somewhat less extent (because of the large amount of ••■attla-raising) rhe same thing applied to Argentina. This would mean that these countries would be increasing their stock at the expense of the trade. New Zealand wa3 a much smaller country, and must export, and the market would be largely left to this country by the others mentioned. In the early portion of the Australian export sea-son, which was now on, the price in London would be so low that the exporter not be able to get the stuff to export, so that a very small jquantity would be sent from there to London. And as the Argentine .season was about the same, the same argument should apply- With these big areas sending little to London, time would be given for the stores there to be cleared, and when the New Zealand season started the exports would find, if not empty stores, at least fast-diminishincr sterns in London. This condition would immediately firm the price, and was almost certain, to raise i*. .Of course, if this recovery shouM take pl.jce, Australia and Argentina would, later in the season, sand an increased supply ; but Mr M'Queen argued that unless it should take place at a very early 'late ihe exports from th.?so countries must fall short of t!*e average. His reason was that should the early part of tha season pass with only moderate business done, 'the shortage over the whole season could not be recovered, because the export must be restricted by the capacity of the free/ing: works in operation. Then in Australia Nutuie imposed a serious obstacle to lar-e export of lambs. If they did nor get the lambs at the free/ing works early in the sr>a3on the grass seed would come in and stop them at the end of the ■season. Only one v. ho had seen a sheep's pelt pierced through by the seed rould appreciate what this meant. The seeds lodged in the wool, and with th? perpetual movement of the sheep they kept working in, and eventually pierced the skin. Then they chafed and irritated the flesh, forming sores and ulcers that made the meat usel«s* for expoit purposes Apain. Mr M'Quflen pointed to flit» statistics of sheepgrpwing - countries. These showed that, coincident with a depletion of flocks, there had been an increase of population—^of meat-eaters. The inference was plain. Still, further, he drew attention to the fact that reports showed »•» improvement in trade at Home, and improved trade meant improved purchasing power among the people. On these grounds be feffc well justinefl in holding the opinion that the present depression was simply a passing phase of the meat trade, and that things would shortly get bark to normal. In one direction he saw a probable benefit to the industry in the recent glut and consequent lf»w prices. The merchants at Home, he thought, in their effort* to quit (heir heavy stock*, would probably make unusual endeavours to open out .the market and exploit the smaller towns- and villages of England, Scotland, and Ireland by putting the low-priced meat on the local markets there. .Should such be the case. Mr M'Queen held t-hat the result would be an ultimate benefit to thp trade, because he had a strong faith in the quality of frozen meat— that is. New Zealand fro/en meat. Once it was established in Hiese smaller towns, he believed it would be established for £food, and even when the prices had gone up to normal the freshly-tapped consumers who had been given a taste of our qunliiv would e\«r demand thtir pound of Sew Zealand frozen flesh.