EXIT COMMANDEER.

Taranaki Daily News, 7 February 1920, Page 10

EXIT COMMANDEER.

PRICES AND 1 PROSPECTS. DEMANDS FOR FREEDOM. Vi PROBLEMS FOR PRODUCERS. T '' (Wellington Post). There dees not appear to be any doubt that the requisition of the exportable surplus of certain New Zealand produce on behalf of the British Government will come to an end this year. Producers make free use of the term "commandeer," and that term is adhered to hereunder to express the various requisitions. It is not the correct word, but it will serve because it is in most frequent use. The history of the different "commandeers" is interesting, because they are intimately connected with the war. The present age is quick at forgetting, but the lessons of history are often unheeded, and mistakes follow as a matter of course. Producers have forgotten, perhaps, those days full of doubts and fears when the war broke out. What was to be the future of prices? What guarantee was there that the produce sliips would leave the Dominion, if loaded at all, and to what sort of ,market would the produce arrive, if safely landed through all the ''acts of God," perils of the sea, and the activities of "the King's enemies"? No one knew anything. The ships went out and some of them were sunk. Some of them put up a magnificent fight before they went down; others reached Home with gaping wounds

: id holds well flooded; others 7.ig-zag<»ed over the ocean, bewildering the enemy submarines, and so got through. But the producer was at one time faced with the possibility of not .being able to ship a ton of goods, and therefore not being able to turn it into money. It was an anxious time, and seems now far off. When the woolbuyers began to operate at the usual season of the year, they made it plain enough that they were not going to pay "prompt," i.e., within 14 days, unless assured of the wool being got away. The frozen meat men were likewise anxious. Confidence was later shown in the future, and, when the dairy produce came on the market, purchases at substantial prices were made for the output of cheese.

THE FIRST REQUISITION. It was March, 1015, that the first commandeer became operative. It was that of frozen meat. Conferences held in February resulted in an arrangement for the Dominion Governmest, acting for the British Government, to take the meat. The Prime Minister assurefl producers that a fair price would be paid for the meat, and Sir James Wilson, President of the Farmers' Union, stated that "we have created a record of exports owing to the high prices obtained for our produce," referring to meat. The scheme was described by the Prime Minister as the "biggest thing in the way of the disposal of our surplus meat that has ever been attempted in New Zealand." The biggest thing to-day represents an expenditure since March. 191, >, to 3lst December, 1919, of a, sum of £41,(100,000 paid to producers by the British Government on account of meat —and paid cash down. All freight, insurance, storage, and their expenses and arrangements, were the affair of the British Government. jhe financial uncertainty was removed; the shipping difficulties were matters of British Government concern. The farmers' anxiety began when the enemy action was so tragically successful by submarines, that it semed that no meat ship could ever reach Great Britain, and that the people there would be starved into submission. Then the shipping tonnage became scarce, and the stores could not be cleared quickly enough to receive the oncoming stock. But here again the emergency was met by the great augmentation of freezing store accommodation, and the I economy of space by the telescoping of carcases.

The meat was wanted (chiefly beef) to feed the troops, any surplus mutton and lamb went into civilian consumption. Australian and New Zealand supplies were valuable, but not sufficient. Foreign countries had to be drawn upon, and they were at a great geographical advantage. Prom them the meat had to be bought practically regardless of cost. Here a disparity in price resulted, and the Australian and New Zealand producer felt this was not fair—to so favor the foreigner. He felt it still was unfair to use his meat to lower the cost of foreign meat, so as to sxipply to the hungry millions of Britain a lower average-priced article of food. Then he became wroth when he learned of the enormous prices at which the British Government has paid to New Zealand producers £16,554,75(1. It held cheese in store at its own risk, and that risk was great. Butter-makers were certainly very anxious at one period of the war, when cheese was urgently required for the army, and butter was of secondary importance. Here, again, the situation was saved by British Government purchase at advancing prices. To butter producers (to 31st-December. 1917), the British Government has distributed a total of £G,515,100. The price rose from 157s per cwt., and 50 per cent, of it resulting from sales—which cm me to £308,000, by the way, to 18]s per cwt..' and no profits. But the fancy prices obtained by Irish, Canadian, Danish but-ter-makers, upon whom the British Government feed a semi-starving people, was compelled to draw New Zealand farmers dissatisfied with even 181s; and reports of the enormous prices to which butter by retail has gone in the United Kingdom to-day have intensified that dissatisfaction. The producer is [ anxious as a business man to get full | advantage of the present market prices and to rid himself of Government control. He is strengthened in this desire by the announcement that the good bargains made by the British Government lin the Dominion are regarded as com- | pensatory for stiff prices (to use no stronger term) paid to foreign producers.

DAIRY PRODUCE. Cheese was wanted for the troops. The Imperial Government first requisitioned about one-third of the ?Tew Zealand output pf the 1015-1(1 season at ? ; |d per pound. In 11)13-14 the dairy farmers felt they were doing very well if their cheese realised (id per lb. in the Dominion. However, next year the Government bought the cheese at 9M, and, a.-; Canadian cbeesemakers were nettin!* more in proportion (after allowing f o 'r the advantage they enjoyed by their proximity to port of delivery * in the United Kingdom), the New Zealand pro-

ducer pressed for better prices, and he received them. The 1917-18 cheese output was sold for lOd per lb., and the 1919-20 output for lOfd —an advance all the time, but not so substantial advance as the Canadian and English cheesemakers pressed for, and obtained.

MILLIONS FOR WOOL With respect to wool, this has been a far bigger "deal" than frozen meat. The commandeer did not operate until Dejber, 1819, the New Zealand woolgrower has received from the British Government (and that within fourteen days oE valuation of his wool) £42,322,700. To that has to be added £5,301,000 paid for freezing companies' slipe wool—u grand total of £47,684,600. And, be- ■ aides all this, the producer is to receive 50 per cent, of the profits made by the Imperial Government on wool sold for other than military requirements. Those profits have been admitted to be stupendous. No one knows what they are at present. Cablegrams show that gigantic profits have been made on wool; that may have been alter it has left the Government sales, but the prices the Government has received has been enormous. The Prime Minister states that the wool commandeer is likely to terminate on due date, 30th June next, and therefore growers will be free to market their produce in their own way and through the usual channels. WHAT OF THE FUTURE. Freed from all restraint, what will be the future of New Zealand produce? Will present prices be maintained when the commandeer ends, and, if so, for how long? Will they go higher? Some observers think and reason that they must advance; others are not so sure. But whatever individual views are held on the matter, ollieially producers would appear to welcome absolutely free markets. The cheese producers are rather quiet on the subject, and the meat producers are certainly anxious to see the stores in the Dominion emptied of British Government meat before they go with their next season's produce on to the market. On IS Ist December last there were in store in New Zealand meat of of 3,034,38!) 001b carcases —say, 4,000,000 carcases. The storage capacity of the Dominion is 7i million carcases. With present season's kiHings there should be at the end of the season 0J millions of carcases. From this must be deducted the quantities to be shipped between now and November next, when the season recommences, and the quantity of insulated tonnage that j is likely to be available is unknown. Upon it, however, will depend not only the question of storage accommodation, but the state of the market. Not only is the quantity of insulated tonnage [ unknown, but the prospective storage capacity in the United Kingdom is also [ unknown. All that is known is that . there are ten months now in which to . lift ten million carcases of meat, or a i million a month. The difficulty may be ■ added to by the discontinuance of "telc- ; scoping" now no longer permitted. It 1 saved 20 to 25 per cent, of storage space on shore and in the ship's holds. • Uncertainty envelopes the shipping ' situation like a fog. All that is known ■ here is that heavy congestion exists on ' the British railways and at the docks, " and long delays are usual in the load--1 ing and discharge of vessels. Ships re- ' turn to New Zealand partly loaded or ' even in ballast, rather than be detained in the United Kingdom while \ millions of pounds worth of produce are only awaiting the "lifting" in this , country, produce of which there is a very urgent and vital need. In. the most fav- . orable circumstances it seems likely . that, on the termination of the com- [ mandeer, there will be live million car- ! eases in store awaiting shipment, to which a .possible two millions in transit [ and in store in England must be added.

FINANCIAL PROBLEMS. Whatever the prices New Zealand producers of wool, meat and dairy produce received under the tommandcer, they were good prices. They were bigger prices than had ever been received before, although they have been enormously exceeded on the distribution ot the produce at destination, also by prices paid for similar produce from other sources. But they unquestionably gave stability to finance in New Zealand. The producer knew what he was about to receive, and although he might not have ultimately been truly thankful, yet he could arrange his finance well ahead Prices were stable; speculation was eliminated. But what of the future, when the commandeer ends ? It may be taken for granted that the banks will pursue a particularly careful policy in respect to making advances, especially to stock on the hoof, for wiio can say what it will realise when it goes on to the market "free?" Until something definite is known about the future of prices for meat, and the disposal of Imperial, purchases, it is not probable that bankers will commit themselves to advances on the basis of present values. It would perhaps have been more satisfactory if the commandeer of meat, at any rate, had been continued longer, until the accumulations were well out of the way. The British Government can sell its meat at any price it likes, at a loss 'if need be. With respect to wool: here is a frenzied rush for it now, but is that a thing of the moment? Are the countries that were at war—Germany, Austria, Belgium, and France, all important buyers in the pre-war markets—in a position to keep up paying even pre-war prices for wool? If their people are so impoverished as is believed, how can they buy them? The future for butter and cheese is not y cloudy, and especially for butter; but l...'ir producers may not receive the long price:: anticipated. In these circumstances there is only to be expected tlmt finance will adopt, if not a "hasten-slowly," a certainly "gang warily" policy. Events are leading in that direction.