THE MEAT TRUST

Pukekohe & Waiuku Times, Volume 6, Issue 330, 16 November 1917, Page 1

THE MEAT TRUST

Report, of the Committee (Published by Arrangement) "The Dominion" (Wellington), of October 25th last, stated as follows : The report of tW Meat Export Trade Committee, commonly called the Meat Trust Committee, was presented to the House of Representatives yesterday by the chairman (Mr E. P. Lee). THE COMMITTEE'S FINDINGS

Following were, the findings of the committee: — (1) That the conditions prevailing during the war, under , which the meat output of the Dominion has been purchased by the - Imperial Government, have necessarily held in suspense the, system of trading which was in operation' before the' Imperial Government took] over the meat supply. If follows, therefore, tbat the operations of the meat trade are n6t carried on with the freedom of contract which prevailed, and" will .prevail, in normal timet.

(2) That .Armour, and Company (of Australasia), Ltd*., is a company registered in New Zealand-and operates in New Zealand on American capital. It is financed arid controlled by Mr J. Ogden Armour, of Chicago, president of the firm, of Armour and Company, Chicago. ' Armour and Company (of Australasia) Ltd, freeze in various works throughout New Zealand:

That in a pamphlet published in 1917 by Annour and Company, of Chicago, setting out their' business organisation, it is stated that:

" Armour packing plants are oper r ated in Argentina; Brazil, Canada, and New Zealand, and Armour selling organisations are located in London, Paris, Rotterdam, Hamburg, Bremen, Frankfort, Copenhagen, Stockholin. Milan; Cape Town, : Havansi, Bllenb* Aires, Panama, Canada

and elsewhere." The evidence before the committee has not disclosed the works mentioned hi the* pamphlet, or that this company had any such packing works in Hew Zealand. That Testey Brothers, of Great Britain and' Chicago, U.S.A., control the following;companies operating in New Zealand, viz: W. and R. Fletcher (N.Z). Limited Westfield Freezing Company, Ltd. The Whangarei Freezing Co., Ltd It has been suggested that Sims, Cooper, and Company (N.Z.), Limited, are controlled by, or assisted with, American capital, but after taking evidence Worn various sources, no proof of thfs has been forthcoming,' but that financial support is received by the company, in so far as buying in New Zealand 1b concerned, from local banking institutions.

(3) That some buyers have given prices for stock which could not be justified in view of the Government rates. This has obtained more particularly in the North Island. The result of these undue prices has been to cause some freezing companies to suffer heavy losses, and in some cases it brought' about : the closing of a company's works for part of last season. (4) That it is unsatisfactory and unfair to the New Zealand producers that enormous profits should have been made out of the sale of New Zealand released meat in Britain.

(s)'That freezing companies are giving large buyers special rebates and conceseiohs. This operates to the detriment of small buyers and tends to create monopolies. (6) That a system has grown up in New Zealand of establishing companies financed and controlled by capital obtained from beyond the Dominion. These companies register in New Zealand with a capital entirely disproportionate to their scale of operations.

(7yThat at present there appear to be sufficient fieezing works in New Zealand lor the stock offering under normal shipping conditions. There is, however, a complaint, which is justified, that space is allotted to large buyers to the prejudice of small producers. (8) The system of payment i.o.b. by the Imperial Government is not conducive to the interests of the small producers, as it tends to put the trade in the hands of the large operators. The small producers are not financially strong enough to wait any length of time for payment, and are placed at a disadvantage with respect to storage and interest.

(9) That in some countries the American Meat Trust has already established control of the meat trade. By its operations it first inflates prices of stock to kill competition, and then acts detrimentally—(l) To the producers by forcing prices down below the fair market value; and (2) To the consumer by imposing

excessive prices. (10) That in this Dominion the producer!, except as shareholders of freezing companies, have not, up to the present, suffered from the operations of large firms, but keen competition has induced high prices. There is, howerer, s distinct danger in the growth of any combination which may endeavour to control values to the injury both of the producer and the consumer.

"DOMINION'S" EDITORIAL

(Published by Arrangement) Referring to the foregoing " the Dominion " in a leading article on Oct. 26th said: The Meat Export Trade Committee, which reported to the House of Representatives on Wednesday, has done usefuj work. In the first place its findings emphasise the disturbing fact that the commercial organisation commonly known as the American Meat Trust, is operating in this country, with the evident intention of capturing and controlling its meat export trade. In aldition, the committee has clearly indicated the bold and far-reaching departures in policy—lmperial as well as natural that are necessary to secure for the produce of the Dominion an unrestricted passage to a free market. The pro blem of protecting New Zealand producers and the consumers whom the.v ultimately supply from exploitation by outside commercial organisation is no' in any real sense local to this country. Of necessity the committee's recommendations deal very largely with •matters such as the control of shippi-.e and of the distribution of meat in Bri tain which the New Zealand Government cannot handle 'wholly on its own account and the treatment of which it can influence only in virtue of the position of the Dominion as a partner in the* imperial* concern. Most of the measures recofrrmended by the commit tee will take effect only when they are enadted in the,, British Parliament as well as in fh» PaiUmeata of the Dominion. It is, of count, incumbent on

the Government of this country to do everything it can to counter local measures taken by the Meat Trust in furtherance of its operations. There is useful work to be done in suppressing unfair trading within the Dominion and in defeating the devices by which foreign monopolists seek to secure control" of the output of New Zealand meat, and also to prevent the evasion of taxation. It is very necessary also th at our producers should combine and act united in their own defence. All farmers should give full attention to the statement of the committee that " in this.Dominion the producers, except as shareholders in freezing companies, have not, up to the present, suffered from the operations of large firms, but keen competition has induced high prices. There is, however, a distinct, danger in the growth of any combination which may endeavour to control values to the injury both of the producer and the consumer." The established method of the Meat Trust, as the committee also points out, is to first kill competition by inflating the prices of stock and then to exploit the producer by forcing prices down to a minimum and the cousumer by imposing excessive prices. Farmersin thi- country are well able to perceive that although their turn as victims has not yet come it certainly will come if the Meat Trust is not checkmated. Trust methods elsewhere leave no room for doubt on this point. In the discussion on the committee's report on Wednesday, Sir Joseph Ward expressed a belief that farmers, who benefitted by keen and active competition among buyers, would demand free and active competition again after the war. An elementary exercise of foresight, however, will enable farmers to r<>cognise that to grant an increasing place in the market to the buyers of the Meat Trust is to disastrously mortgage the future—a future probably not very distant for the sake of temporary and precarious prosperity. There is a plain warning in the committee's statement that somo freezing companies have suffered heavy losses as a result of the artificial inflation of prices, and that one company was compelled to clcse its works for part of last season. It cannot be too strongly emphasised that by every act which tends to intensify this state of affairs farmers are helping to hand themselves over to .the Meat Trust. bound hand and foot. They are playing a part in all respects analogous to that of the "Reubs" of American fiction who become the victims of confidence men and other lawless despoilers. So far, however, as the main problem is concerned, anything that happens in this country in connection with the campaign against tho Meat Trust can be little more than an affair of outposts. If producers and 'consumers arc to be adequately protected aginst exploitation there must be not only due regulation of trade in this and other producing countries of the Empire, but also effective control of shipping and ship ping freights and of the distributing agencies in Great Britain. The problem is seriously complicated by the fact that the beef market, as Sir Joseph Ward remarked on Wednesday, is almost wholly controlled by the Americans By its control of beef supplies, the Meat Trust is enabled for the time being to interpose to its own profit in the distribution of mutton and lamb in Great Britain. It has contrived to exercise this power even during the war period, as appears from the fact that it has handled and levied toll, at the expense of the consumer, on a certain amount of New Zealand meat released by the Imperial Government for retail sale. It is to be noted as emphasising the need for energetic action that the restraints at present imposed on the operations of the Meat Trust in Great Britain are chiefly in the nature of special measures devised and imposed for the period of the war. Unless the Meat Trust and similar organisations are to be granted an interval of comparatively unrestricted operation {mmanent measures of trade control must be agreed upon to c>me into operation when peace is declared, or as soon as possible afterwards. The facts which have been touched upon and others demonstrate that the prob'em of defeating the Meat Trust is part and parcel of the problem of fostering trade within the Empire which was rightly given a prominent place in the deliberations of the historical Imperial War Conference which sat in London in the early part of this year. Developed with due energy, the trading policy which was shaped in broad outline at the Conference will make provision for ousting the Meat Trust from the markets of the Empire, while it also promotes much larger objects. The Conference, it will be remembered, unanimously passed the following resolution: The time has arrived when ail possible encouragement should he given to the development of Imperial resources, and especially to making the Empire independent of other countries in respect of food supplies, raw materials, and essential industries.

The Conference further expressed itielf in favour of" the principle thateach of the Empire, having due regard to the interests of our Allies, shall give specially favourable treatment and facilities to the produce and manufactures of other parts of the Empire." It is manifestly on these lines that action must be taken to solve tne problem of defeating the Meat Trust with which we are immediately concerned. The institution of such a policy opens some very big questions, each one of which demands careful ami detailed consideration, but action is greatly facilitated by the exhaustive preliminary inquiries which have been carried out, notably by the Dominions' Royal Commission. A section ot the Commission's report which has a vital bearing on the problem of coping with organisations like the Meat Trust relates to shipping. It recommends, amongst other things, that the contractor for all Government subsidised shipping services should be required to submit freight schedules for approval, and that the rates approved should not be altered without consent. Another and more comprehensive recommendation is that the British and Dominion Governments should set up boards for the purpose of making inquiry into action on the part of steamship owners or conferences adversely affecting the interests of shippers. It is contemplated by the Commission that the boards should have power to order the abolition of differential rates which are found inimical to Imperial trade. Control of shipping and the systematic development of production within the Empire ;ire factors of cardinal importance in eliminating illegitimate interference with trade, and safeguarding the interests of producers and consumers. Given production of the necessary supplies and their unimpeded conveyance to the market distribution on sound lines will present no insuperable difficulties, it is necessary that the New Zealand Government joould exec-

cise every possible means to stimulate the Imperial Government in shaping a policy that will enable practical effect to be given to the recommendations of the Meat Export Trade Committee. Fortunately there is fairly satisfactory evidence that its efforts in this direction will not be wasted. In August Mr Walter Long (Secretary of State for Colonies) announced that the British Prime Minister had appointed a committee, consisting of Ministers representing all the Departments concerned. to inquire into and report upon the best methods of giving effect to the Imperial Conference resolution which has been quoted. A late indication of the activity of the British Government in this connection, and one which has a special bearing on the problem of the Meat Trust is conveyed in a cablegram published to-day. It is an announcement that a conference of Board of Trade authorities and the High Commissioners of the Dominions has appointed a committee to devise a scheme of obtaining the United Kingdom's meat supply within the Empire. This is a step in the right direction, but it isonly an initial step, and progress of a practical kind is notlikely to be made unless the Governments of the overseas Dominions keep the question alive by repeated and urgent representations on every possible occasion. And never have they been in so strong a position to command the attention and consideration of the Imperial authorities as they are to-day.