NORTH ISLAND BACON GO.

Putaruru Press, Volume IV, Issue 136, 10 June 1926, Page 6

NORTH ISLAND BACON GO.

UNFORTUNATE NORTHERN GUARANTORS. It is interesting to recall the go. d wrrk done by the progressives who have done their best to advance the bacon industry, and who now find themselves labouring under a most serious burden because of guaranteeing finance on the eve of a disastrous post-war meat slump and when fortunes were being lost in all parts of J the world. j The Waikato Farmers’ Bacon Company started some twelve years ago. The price of pigs at that time was j 3Ld a lb, and Waikato farmers were ( very much dissatisfied with the price. After a series of meetings, under the auspices of the Farmers’ Union, a canvas was made, with the result that some £6OOO worth of shares were taken up and it was decided to form a company and buy out the bacon factory at Frankton Junction of Messrs. Watt Bros. Messrs. Barugh, Paterson, Maekay, Clarkin, Shepherd, Hubbard, Strange, Watt and Banks were the original directors. They were at once faced with the proposition of running a business requiring a capital of £30,000 with a capital of only £6OOO. Tire result was that in order to carry on the directors had to sign a joint and several guarantee to the I bank for £25,000. They, of course, ! got nothing out cf it, but the result was that the big producer immediately I benefited. The price for pork in the j Waikato in the following year was | 4ld per lb, whereas in the Bay of j Plenty, where the private companies had no competition, the price was 3Sd per lb. The extra penny put about : £40,000 into the pockets of the Waikato farmers. This policy of paying j the farmer all that there was in it for his pigs was pursued by the Waikato Farmers’ Bacon Company and the N.Z. Farmers’ Bacon Company (into which it merged) for the whole of their existence. As the private companies had to give the same price for the pigs they purchased the result was that no company made much out of pigs. The only trouble was that the non-shareholder got as much for his pigs as the shareholder, which is wrong in principle. Since the bacon company went out of existence three years ago the private companies have had it all their own way and they must be doing well as several new private companies have lately sprung into existence. As there is now a good export trade it is time the farmers again took more interest in the pig industry. j When the amalgamation of the Waikato Farmers’ Bacon Co., the Tara- | naki Bacon Co., and the Dimock Co. took place the Waikato directors, with the exception of Messrs. Barugh, Paterson and Banks, were released from this joint and several guarantee for £25,000, and the three gentlemen named were immediately confronted with six other gentlemen for a joint and several for £50,000, and as they had> done so well in keeping up the price of pigs in the Waikato they thought they would do just as well for the whole of the North Island, and ’so shouldered the burden. There was, in addition to the bacon works at Ngaruawahia, a big tinning department for beef, pork, etc., and it was decided to extend the works and kill fat cows, etc., as well as pigs. It was mainly through this that the company failed. The Home beef market went to pieces and the company lost £85,000. The bank thereupon forced it into liquidation and called i'o the guarantee of £50.000. One Wellington gentleman could not pay and the three Waikato gentlemen had to find £17,100 on March 31, 1923. This, with compound interest, now amounts to £21,000. A number of Taranaki dairy companies got to work in 1923 and de(Continued in Next Column.)

■' ducted Id a lb of butter-fat and paid the whole of the amount owing by the : widow and family of Mr. Powdrell, \ the whole of the amount owing by Mr. 1 Marx, and with hi a few hundreds of | the whole of the amount owing by ■ Mr. Forsyth. j It is considered by very many men who are imbued with the right spirit jof co-operation that the Auckland guarantors should be assisted out of ■the general co-operative funds, as it is obviously a case of extreme hardship that a few men who pledged the whole of their possessions for the welfare of an industry of the dairyI farmers of their districts should be alj lowed to bear the whole of their , crushing financial burden.—The Dairy- | farmer. i COMMENT. [ The views expressed by the Dairy- ! farmer in fihe last paragraph are nothing more than common honesty, and j until the three gentlemen named are j reimbursed co-operation in the Auckj land Province will not again enjoy j commercial sweetness. j MATAMATA ENDORSES. S At the annual meeting of suppliers i at Matamata on Friday night the pro--1 posal for reimbursement was endorsed i unanimously.