The Daily News. SATURDAY, AUGUST 28, 1920. COMPETITION IN FROZEN MEAT.

Taranaki Daily News, 28 August 1920, Page 4

The Daily News. SATURDAY, AUGUST 28, 1920. COMPETITION IN FROZEN MEAT.

As a producing country New Zealand's prosperity depends on safeguarding the interests of the producers from exploitation by combines or any other means. It is also essential that no impediment be placed in the way of producers to prevent them obtaining the best possible prices and the most favorable markets. In considering the case of Messrs. Armour and Co., or any other of the large American packing firms, these two points, as well as others, have to be kept in mind in order that a just estimate may be formed as to whether there is danger or advantage likely to accrue, not necessarily in the immediate present, but in the future, if what is known as the American Meat Trust is allowed to operate in the Dominion in stock "on the hoof"' and carry on the business of meat exporters on equal terms with the organisations that already exist for the purpose, either as private concerns or those controlled by the producers themselves. By the recent publication of Armour and Co.'s case in our columns both sides of this controversy have been placed before the public, and those more particularly interested. The problem is by no means easy to solve. The producers naturally desire to obtain the best prices for their stock. Experience has proved that competition is the main means whereby the marketprice is influenced—the greater the competition, generally the higher will be the price. It may, therefore, be argued that it is good business to encourage competition, and from that point of view every legitimate competitor should be welcomed. As far as Armour and Co.'s advent into the arena as purchasers of stock is concerned the vital issue is as to their bona fides; whether their object is legitimate or sinister; Whether they will trade on fair lines or are out to "collar the market'' with the ultimate intention of forcing the producers to sell at any, price' the company,

pleases. Armour and Co,, without dobut, are not carrying on business in any spirit of philanthropy. Like all keen traders, they are seeking profits, and the large capital at thgir command gives them advantages that smaller concerns lack, and enables them to operate wherever they can find suitable opportunities. The American Meat Trust is regarded by many as the quintessence of un-, scrupulousness, and there 'is no doubt that in the past those forming the Trust have justified the strictures their tactics have evoked, but that does not prove that, under proper safeguards, such as already exist on the New Zealand Statutes, Armour and Co. are not to be trusted to carry on business in the Dominion and become competitors for the stock raised by our farmers. The Government wisely considered it advisable to safeguard the producers by enacting that it sliall not be legal for I any firm or company to carry on the business of a meat exporter unless granted a yearly license by the Minister of Agriculture, who has power to revoke that license at will. In Armour's case the Government has for two years taken the license fees, but has withheld the license, a proceeding that cannot well be defended. However, that is not a point that matters much except as to its equity, which is about on a par with the refusal of the license without hearing the case for the applicants. The outstanding question is whether or not it would be in the best interests of the producers to allow Armour and Co. to operate in the Dominion. The chairman of the Wellington Meat Export Co., when referring to this matter at the recent annual meeting, stated that no practical benefit could be obtained by allowing large American companies to establish expensive stock-buying organisations in New Zealand, as their very size alone would soon give them" control of the bulk of the fat stock available, "thus enabling them to dictate their own terms to the industry." The question of rivalry may have been at the root of this view, which is directly opposite to the opinion expressed by the Canterbury Sheepowners' Union, which considered that the producers would benefit rather titan otherwise were the path cleared for the export of the Dominion's surplus lamb to America, where a limitless market appears to exist. As Armour and Co. can buy frozen meat in the Dominion and sell it in America, it would seem that the granting of a license, which can be revoked at any time if necessary, might prove the correctness of the Sheepowners' view. When conflicting interests clash there is always difficulty in acting for the best, and it is an open question whether barring Armour and Co. from operating direct instead of through agents—and they can always arrange with agents—will not be prejudicial instead of beneficial to the stockraisers. Mr. W. J. Poison, of Wanganui, truly said the other day that we must get rid of the meat that is cramming our stores at the earliest possible moment. America provides a large and profitable market, and it is one that can be advantageously developed. The Farmers' Union is united in its desire for a free market at Home for all their products, and the right to untrammelled and unrestricted trade. "Why then," concludes Mr. Poison, "not be logical and trade with the best customers we have, always providing that we do not give them any opportunity to injure us? We can control any foreign concern's operations in this country."