TRADE OUTLOOK.

Taranaki Daily News, 21 July 1922, Page 3

TRADE OUTLOOK.

PAST YEAR REVIEWED. FLUCTUATIONS OF PRODUCE. COLLAPSE OF LAND BOOM. A BRIGHT FUTURE FOR TARANAKI. Matters which affect trade and commerce in New Zealand in general and Taranaki in particular were referred to ,at the annual meeting of the Taranaki Chamber of Commerce last night by the president (Mr. T. C. List). The past year has been one of the most difficult experienced by the Dominion in the whole course of its history. The year beginning in July opened with unremunerative prices for wool, mutton and beef. Butter and cheese were fortunately still commanding good prices, and to a large extent saved the situation for the Dominion. As the new season advanced, however, prices for ' dairy produce steadily receded until by I December the butter market had prac- . tically collapsed. The fall was attribi utable to the action of the Imperial I Government in holding on to their . colonial butter stocks and then suddenilv deciding to sell the lot on a ! basis of 100*. As soon as these * supplies were disposed of. however, prices began to improve, and by April 1 had reached 183 s to 1955. For some rime prices were uneven, and then in May and June, as the result of the shortage in supplies from Ireland and the Continent, they reached over 200 s and to-day are quoted at 210 s.

CHEESE AND MEAT. The prices for cheese were not as depressed as those for butter, but they showed considerable fluctuations. In June, 1921, New Zealand cheese was worth approximately 112 s on the English market, rising to 132 s in August, from which point it declined to 80s in May. To-day, however, the market is considerably better, quotations standing at 945. Wool prices, on the other hand, began to show a movement for the better as dairy prices receded, and to-day are back to’ the 1914 level, and the markets have an improving tendency. In regard to the meat market, prices for lamb are to-day better than in 1914, when it brought whilst to-day it realises from 10 Ad to lid. Mutton in 1914 was sd; to-day from 7d to 7%d. The beef market, however, is quite unremunerative. being down to 4 l-8d as compared with s£d in 1914. The present price leaves little or no margin of profit for the grower, particularly when the great increases in cost of handling, shipping charges, etc.. are borne .in mind; consequently beef-raising "is at a serious discount. The recession in prices came as a great blow to many of our farmers, particularly those in the back country, and with the fall in the wool and mutton markets has made things very awkward for them. There is at present no sign of an im- : provement in the beef market, the opinion of authorities, here and in Austra- ; lia, being that the market will not “come back” for another five or seven years, according as Europe puts her house in order and secures the necessary credit for the purchase of outside meat supplies. TURNED THE CORNER.

It would appear that we have turned the comer so far as low prices for our other products are concerned. It is. of course, inadvisable to prophesy regarding the state of markets, which are sensitive to conditions that may unexpectedly occur, but a glance at the position of things in England to-day justifies the belief that she is industrially and commercially on the mend. The British export trade, in fact, is in a particularly healthy condition, compared wTtn what it was during the first half of last year, whilst shipping, which has been passing through the most difficult time on record, is beginning to pick up •gain. Unemployment is still unfortunately very considerable, but the reduction reported lately is a hopeful sign of the recovery of trade. New Zealand’s trade and welfare are bound up indissolubly with Britain’s. Whilst the latter’s trade is stagnant and has millions unemployed England cannot pay the prices for the raw products we have to offer and. eonrfdermer that this ’me last year England was in Che throes of a most seriou= industrial upheaval. it is really surprising that she has been able to buy what «he has from us. even at the —to us—unsatisfactory price* obtaining. It would point to England’s l great financial strength and recuperafive ability and the sagacity and confidence of her industrial and commercial leaders.

A BRIGHT FUTURE. Our producers can face the future with every confidence. They cannot expect the fancy prices that ruled during the war, and even in 1920-21. but they can count upon remunerative prices for’butter and cheese, wool, lamb and mutton. All of is wanted at Home, and as the frade depression lift® then so will prices of our produce improve. To-day's butter and cheese prices are very satisfactory. It would be unwise in the light of the experience of the past eight months to say that they will continue at the present level during the coming season, but this can be claimed, that there was no warrant for the disastrous collapse of the market last year; it was not caused by the operation of the law of supply and 'demand, it being due entirely to the unbusinesslike policy adopted by the Imperial authorities respecting the disposal of their stocks. Fortunately, this disastrous experience is not likely to recur. , , , Tn respect to wool, it has been shown bv Sir Arthur Goldfinch, the late British wool controller, that the present consumption of wool is greater than the production, which accounts for the-de-duction of the stocks held by B.A.W .K.A. 'from 2.700.000 bales this time last year Ito 1,381,000 bales last month. The past year has been one of the most remark'able in the history of the Australian wool trade, and the prospects are quite bright. Our back country farmers, who have been so badly hit over low wool . prices, should come into their own again in the near future. TRADE CONDITIONS. The trade conditions in New Zealand at this time last year were by no means satisfactory. Goods were pouring in from Home manufacturers, goods that ijrexe totally unexpected. a»d finance had

to be arranged. This placed a big strain upon the resources of the banks at a time when credits for New Zealand produce at Home were disappointingly small, but the position, one of the most difficult in the history of the country, was successfully faced and met. In recent months importations have fallen and now there is a safe margin between imports and exports, ensuring the Dominion’s financial safety and solidity. In common with other districts Taranaki has been affected by the fall in produce prices and consequent slump, though not to the extent many who had grown concerned by the tremendous prices being paid—or. more correctly, being arranged to be paid —for much of the land. There has been a good deal of readjustment between vendor and purchaser, and many settlements. In not a few cases the purchasers have had to sacrifice the whole of their capital, the savings of a life-time, and now have to face the world anew with nothing at all but their own strong hands and stout hearts. Many farmers who sold at the top of the boom and retired into the towns have been obliged to resume their holdings.

VALUABLE LESSONS. The lessons learned during the past twelve months will not be forgotten for many a year, and in the end the collapse of the land boom may prove not without benefit to the province. It is certain that nothing else would have so emphatically driven home the truth that land is worth only what it will produce, not in a special or boom price year, but over a number of years, and that it is unsafe to purchase land at a price that will not permit of a safe margin for emergencies. The danger was : known to a good many of the levelheaded and experienced men of the province. and. to do them justice, they raised their voices in warning, but they were quite unheeded and their motives often misconstrued.

In the process of readjustment great hardship in many cases is inevitable, but the sooner it is completed the sooner will normality be reached. A new standard of values must be accepted, and every effort to boom prices again by a temporary rise in the produce markets should be resisted by all having the interests of the province at heart. Whilst many owners and occupiers of the land have had to leave their holdings, others have- taken their places, and production will continue as usual, so that from the production point of view Taranaki will not be materially affected by the financial troubles that have occurred.

TARANAKI'S WONDERFUL PRODUCTION. The province’s production, as a matter of fact, keeps up wonderfully well. The change in the system of compiling the export statistics, giving credit to Wellington for the exports from the Taranaki ports, makes it impossible to institute an accurate comparison with previous years’ exports, but some idea of the increase in production in Taranaki may be gained from the following figures. For the year ending June. 1922, the butter receiveci by the Moturoa Freezing Works was 201,133 boxes. In the previous year the figures were 153,210 boxes. Cheese for the past year amounted to 146,237 crates, and in the previous year to 121,632. The increase in butter production was 31.27 per cent, and in cheese 20.22 per cent. Patea put through 67,500 boxes of butter, compared with 64.743 in the previous year, an increase of 4.25 per cent.; whilst cheese increased from 135,491 crates to 183,885. an increase of 35.7 per cent. The increase in production in Taranaki for the past year was therefore 23.2 per cent, in butter, and 27.99 in cheese.

This marked increase in. production is due largely to the favorable season experienced. and set off to an appreciable extent the lower prices received for the produce. It may not be inopportune here to correct an impression that is widespread that all Taranaki lands were affected by the land boom. This is quite wrong. Fortunately the great majority of farmers, especially in the northern part of the province, did not sell or exchange their properties, and consequently they are well able to weather the storm caused by the low prices prevailing. A percentage of those who bought will also be able to overcome their difficulties. It ,is only those who bought at the top prices and possess insufficient capital to I carry on who have suffered and are ; suffering.

I FARMING TOO MUCH LAND. i I would like to point out, as others more qualified to speak have often pointed out in the past, that the average Taranaki farmer has altogether too much land to profitably utilise with the labor and capital at his disposal, and that he and the province would be far better off if he reduced his holding and farmed it better. Having just returned from a visit to Australia and seen how farming is carried on there, the methods employed, and the quality and nature of the land, and the climate drawbacks from a dairying point of view, I am more than ever convinced that in Taranaki we have ideal conditions for dairying, and that if our farmers would concentrate on smaller holdings, feed | their cattle better, provide rugging in winter and better shelter, nave smaller paddocks, go in for systematic testing and so build up the quality of their herds, they would receive greater returns than they do from their present farms and the province advance by i leaps and bounds. Their capital cost in i respect of land would be only one half ■ what it is, and the life itself would be much more interesting than is the case to-day. I am sure than on fifty acres of our land of fair quality, a man could do splendidly. Sub-division of this nature would entail capital expenditure, for more houses and outbuildings would necessarily have to be provided. It would call for money at a reasonable rate, and this is a matter that might well engage the attention of farmers and commercial men alike, for their interests in the development of the resources of the country are common.

The value of Taranaki’s exports for the past two years have averaged over five millions sterling, or over £BO per head of population. There is no reason whv it should not increase to fifteen millions sterling, and its population of 63 000 grow to 200.000. There is no other part of New Zealand more favorably situated for dairying, nor possessing more uniformly fertile lands than Taranaki. Its poorest lands are infinitely more adapted to dairying and cattle raising than the best of much of the land devoted to dairying in Australia. GOOD COMMUNICATIONS IMPERATIVE. But not enough is being done to open up the country by means of good roads. A# is howi/s number

the Chamber last year made a tour <.f the backbloeks, and were agreeably surprised with what they saw—fine tracts of country, much in its virgin state, but all, or nearly all, without all-the-year access. Communication with the rest of Taranaki is impossible for many months of the year, notwithstanding that the country was opened to settlement over twenty years ago. This condition is a grave reflection on all responsible, and there should be no further delay in providing the settlers with outlets. The delegation -was particularly impressed with two things —the need for metalling the road between Tahora and Tatu in the Ohura, and the equally great need for xcompleting the lower Awakino Valley Road, which will do away with the terrible Taumatamaire saddle, which is now a complete block in the winter months to communication, betweeri the back country and Taranaki. The cost of metalling the Tangarakau would not be heavy, and now that it has closed down work on the Tahora end of the railway, it is incumbent upon the Government to push on with the metalling of the road, acting as it will as a connecting link between the railheads. Work on the Lower Awakino Road, has been going on for over six years. The worst parts have been done, and the construction of the rest of the road is comparatively easy. The Chamber has made repeated representations to the Prime Minister and the Minister for Public Works over the necessity for pushing on with the work, and, it is satisfactory to record, not without some success, but still much more requires to be done if the road is to be made available in a reasonable time.

The Public Works Department have been engaged on metalling Mt. Messenger. and it is hoped they will push on and complete the metalling not only on the hill, but right through to the Mokau river. The bridging of this river is another matter of pressing importance, and the Chamber has specially asked the Government to place on the Estimates this year money to commence the work and push it through energetically, so as to give direct and uninterrupted communication between the Auckland and Taranaki provinces, which should have been provided years ago.

PROVINCE’S MAIN REQUIREMENTS.

The metalling of this road, the bridging of the Mokau, and the completion of the Lower Awakino Road mean as much to New Plymouth as they do to the back settlers, for it will bring trade to the port that now goes northwards and enable our merchants and others to compete on even terms with the northerners for the trade in the fertile districts of Mahoenui, Pio-Pio, Aria, etc. This and the Tangarakau gorge road constitute to-day’s most pressing Taranaki requirements. and it remains for the Chamber to continue to work in conjunction with all the other bodies interested. with a view to having these national works undertaken by the Government with the least possible delay. It is pleasing to record that the harbor board, after a series of difficulties, have now got well under way with the reclamation works at the foot of the breakwater, preparatory to the construction of the new wharf, and also are pushing ahead with the -breakwater extensions. The trade of the port has outgrown the facilities, and it is imperative that the harbor improvements should be pushed forward with a minimum of delay.

A FORECAST. With a harbor able to cope with the trade, a regular direct shipping service between the United Kingdom and New Plymouth, the opening up of the gateways to the rich and extensive hinterland of the province, and the completion of the hydro-electric scheme iu New Plymouth, making available cheap electricity for the town and district, New Plymouth must become in a few years a town of considerable size and importance, and the district behind it, one of the most prosperous in the world. The rate of development of town and district, however, depends entirely upon the imagination, judgment, industry and energy of the leaders, and the .support given by the people as a whole, but foundations sound and solid have been laid, and it is to be hoped those that follow will show similar farsightedness and energy, and work whole-heartedly for the good of the town and province. They are well worth working for.