8.—6,

XIV

FAEMING INDUSTRIES. The year has been a successful one for all classes of farmers and stockowners, and general prosperity is apparent throughout the districts of the colony. The total value of the exports of the principal items of farm-produce, although slightly less than the phenomenal amount for the year 1902-3, is more than two and a half millions in excess of the value for the year 1901-2. The export of wool is less in quantity, but, owing to the improved prices ruling, the value has increased by .£598,242. Tallow shows a decrease in both quantity and value, and the number of sheepskins is considerably less, although the total value shows an improvement. These decreases are all attributable to the changes made from sheepraising to dairying, and to the reaction following upon the abnormally large export of frozen mutton and lamb during the year 1902-3, which was followed by a very heavy snowstorm in Canterbury and North Otago by which many thousand sheep were lost. In view of the losses sustained by the snowstorm and the extraordinary drain then made upon the flocks of the colony, the figures for the year now under review are highly satisfactory. The output of butter shows an advance of about 51,000 cwt., the value being £147,725 in excess of last year. Moreover, the quantity of cheese was nearly 12,000 cwt. greater, and the value improved by J625,266. The continued progress of the dairy industry is extremely gratifying ; but, in view of the decided fall in the price of both butter and cheese lately experienced in the Home market, I desire to impress upon milk-suppliers the desirableness of introducing the best blood into their herds, and of regularly testing the yield of each animal, in order that the amount of butter-fat produced per cow may be gradually increased. It cannot be too strongly urged upon dairy-farmers that a high-grade herd will pay better when butter-fat is worth Bd. a pound than an ill-selected one when the price is 10d. Owing largely to the renewed ability of Australia to supply its own requirements, and. the diminution of the demand from South Africa, the export of grain shows a falling-off, especially in oats. It was of course expected that the breakup of the drought in Australia and the withdrawal of the bulk of the troops from South Africa would largely affect the demand for New Zealand cereals in those countries. The export of grain may now be considered to have resumed its normal level. The output of New Zealand hemp still continues to grow, both in quantity and value, and there can be no doubt that Government grading of this product has enabled it to reach and hold markets in which it could not otherwise have obtained a footing. Commercial fruit-growing is gradually becoming established in the colony, and further provision for the treatment of this product is much needed. An expert in canning and preserving fruit has been selected in London, and will take up his duties at an early date. It is hoped that fruit-growers will see the advantages of combining to export fresh fruit and to erect preserving-factories in all suitable localities. If the industry is developed along these lines fruit will soon take an important place amongst the colony's exports. With wool, sheep, and lambs at present prices, and although a reduced price is obtained for our dairy-produce in the Home markets, the outlook for New Zealand farmers and pastoralists was never brighter than at present. CROWN LANDS AND SETTLEMENT. No effort has been spared by the Government to push on with surveys and the throwing-open for settlement of the remaining Crown lands ; and, realising that, speaking generally, the best part of the public estate had already been alienated, and that it was necessary to offer further inducements and encouragement to persons desirous of acquiring and occupying areas of land in the rougher and more remote districts, the Bush and Swamp Crown Lands Settlement Bill was introduced and passed last session.