H.—29b

Unfortunately, all companies do not enjoy this advantage. Drying, a costly process, has to be undertaken, and this naturally results in an increased price to the farmer. Some companies whose product needs drying have not provided for this contingency when constructing their plant, with the result that in wet weather production has to cease and orders cannot be fulfilled. In the peak periods such a position is serious, and it is recommended that, despite the extra cost, provision should be made by those companies for drying-plant to be installed where necessary. (d) Fineness of Grinding.- There is a divergence of opinion as to the degree of fineness to which limestone should be ground. On the one hand it is contended that coarsely ground lime is easier to sow and does not leach to the same extent as a finely-ground product. On the other hand, it is stated that finely-ground lime is more quickly available in the soil. Unfortunately, again, experiments with finely and coarsely ground limestones are not sufficiently advanced to comment on these points, but it is agreed that a small percentage of coarsely-ground lime does make for easier running through the topdresser. There is no regular standard of grinding throughout the Dominion, the variation in many cases being considerable. It has been suggested that some standard of fineness of grinding sufficient to meet the average farmer's requirements should be enforced, and this request appears reasonable. It should be borne in mind, however, that to secure an extra degree of fineness, involves a considerable increase in production costs. General. To sum up the requests for adjustment or regulation under these headings, the Committee is of opinion : — (a) That any variation of price according to quality is not possible under present conditions : (b) That a certificate as to the carbonate content of the lime should be issued with each invoice : (c) That some reasonable standard of fineness of grinding should be insisted upon : (d) That moisture content should be controlled. THE ORGANIZATION OF THE AGRICULTURAL LIME INDUSTRY. The only regulations in any way affecting a measure of control over the industry are those operating in respect of the granting of the free railage subsidy. Before a company can be granted the privilege of railing lime free of charge to bona fide farmers it must obtain, through the Railways Department, the consent of the Department of Agriculture, which, before giving same, is to be satisfied that the establishment of the works is warranted, that the price charged is reasonable, and that the quality of the lime is satisfactory. Any increase in price thereafter is also subject to the approval of the Department of Agriculture. The regulations affect companies desiring the free railage privilege, so that no control whatever was placed on producers situated at a distance from rail. These regulations have not proved entirely effective in checking the establishment of superfluous units, especially where the Department was confronted with a fait accompli —that is, where a company had gone to considerable expense erecting works without first obtaining permission to be granted the concession. The upshot has been the springing-up of mushroom companies all over the country, even in districts where an efficient service was being rendered by existing works. This has resulted in uneconomic competition, price-cutting in the first instance, then, in certain districts, as finances were depleted, organized efforts to have the price of lime raised to the consumer. This would have resulted in many companies going into liquidation had it not been for the remarkable increase in demand. The position to-day is that there are in certain districts companies which may be superfluous to the industry and which, by gaining a measure of business, are preventing the industry generally from operating at capacity production. This position must be faced, and it is apparent that no new works should be allowed to commence operations without a full investigation into all the surrounding circumstances. There are several methods by which control can be effected : — (a) Departmental control such as is operating at present in connection with the free railage subsidy: (b) Licensing—either (a) under the Industrial Efficiency Act, or (b) under separate legislation covering lime-production. Under this system every company in the Dominion would be required to apply for a license to produce and sell agricultural lime. The issuing of the license would naturally be subject to compliance with certain conditions, of which the principal would be— (i) That the lime produced be of an approved standard of quality both in regard to analysis and fineness of grinding ; (ii) That the price to the consumer be reasonable ; (iii) That existing lime-producing companies be not prejudicially affected by the establishment of new units, always providing for fair competition. 7. SUNDRY. MOBILE PLANTS-COMMUNITY PLANTS. By reason of the present free railage subsidy on agricultural lime the tendency has been for lime companies to commence operations only on deposits situated within easy reach of the rail. As a consequence, back-country districts have suffered, either by having to pay heavy road transport costs on the lime or, because of the uneconomic cost, by doing without lime altogether.

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