The Daily News. THURSDAY, JANUARY 29, 1920. THE FREE MARKET OUTLOOK.

Taranaki Daily News, 29 January 1920, Page 4

The Daily News. THURSDAY, JANUARY 29, 1920. THE FREE MARKET OUTLOOK.

Mr. Massey has received advice that the Imperial Government has decided to terminate the purchase of New Zealand meat after June ,30 of this year, and he thinks the wool commandeer will end on the same date, but that possibly butter will still be controlled by the Government, though as to this Ihtre is no definite information. Assuming, however, that the British commandeer will cease entirely by the end of the coming July, it is advisable to ascertain, as approximately as possible, the nature of the conditions under which the producers of the Dominion will face a free market for their wares. It may be stated at the outset that the position is by no means easy to define because there is no reliable information regarding the reasons which influence the British Government in their policy regarding the distribution of meat and wool. "We are bound to assume that certain factors exist of which neither the Dominion Government nor the exporters have any cognisance, for the reason that it would not be politic for the Imperial Government to

disclose its policy until the world's markets have approached nearer to normality than is the case at present, and then explanations may be made that will place a far different complexion on what now appears to be inexplicable. "With regard to frozen meat, it was stated in November last that the stores of the United Kingdom were full, and that steamers were arriving with frozen cargoes for which there was no storage. The Government holds and controls this meat which, if released, would bring down the price by threepence or fourpence per lb. The Food Controller (Mr. M'Curdy) stated to an interviewer that the stocks of all European countries showed for next year a deficiency of three million tons, and that there was a substantial shortage in Britain. He subsequently told a House of Commons Committee that the supply of home-grown meat was then at high-water mark, and, at the same time, cargoes of frozen meat, which had been held up in the colonies, had come to hand, causing a glut, so that the consumers could get as much frozen* meat as they liked at less than the cost price to the Ministry of Pood. Col. "Wedgwood taxed Mr. M'Curdy with wanting to keep up the price of food, adding that a glut did not mean cheap food, but the paying for the destruction of any surplus. It is as difficult to reconcile these state-, ments as it is to understand the Imperial Government's policy which, presumably, should be to protect the interests of consumers in view of the cessation of the commandeer. It may be considered that the restoration of open markets would cause such a drop in prices that would lead to frozen meat supplies being diverted to other markets, and therefore a reserve supply is desirable, but this involves a serious position for the producers, as at the beginning of the next export season there will probably be some two million freight carcases of meat in store on behalf of the British Government, necessitating special arrangements as to shipping next season's new meat. If the producers were not insistent on reverting to a free market at the end of the present commandeer a twelve months' extension might solve the problem by enabling the Imperial authorities to gradually unload accumulations. The people of Britain want more meat at a lower price, and if this could be managed it would materially help to clear the stores in New Zealand and give the producers a fair start on the open market. At any rate the time has arrived when Mr. Massey may fairly ask the British Government to take him into its confidence and give a frank and full avowal of the reasons which actuate its present policy, both as to meat and wool. With regard to wool, there may exist ~ve.ry good reasons for the British Government only releasing sufficient to meet the immediate requirements of the textile industry. It is raw material which it may be desirable to keep from late enemy countries and neutrals in order to foster the expansion of British trade, which is so greatly needed from an economic point of view. As against this must be placed the direct effect of this restriction which has forced up prices enormously and has greatly added to the cost of living, both in Britain' and the Dominions. The position bristles with difficulties, and the only solution appears to be the re-establishment of the open market, together with sympathetic cooperation by the British authorities in the disposal of the present large stocks held by them. The dairy producers may be trusted to watch their own interests, though, they, in common ■ with the other producers, would do well to organise a practical scheme of control and distribution in order to obtain the best value for their goods, either on the British, or any other markets.