Crush Copra In The Islands

A Planter's Plea For Reorganised Industry

Letter to the Editor

THE article written by Vincent C. Davis-, in your March issue, gives the arguments for and against crushing copra in the Islands.

As your editorial note points out, there is no advantage in simply crushing copra for the oil, in the Islands. Why should copra be crushed in the Islands, as the price is practically the same for crushed and uncrushed copra. I agree that this will always be so, as long as oil or copra passes into the Unilever maws.

But, on the other hand, has Mr. Davis or the editor considered the fact that the raw product is not where the Combine gets its huge profit? The facts are these: The Combine pays as little as possible for its raw product, and sells its manu factured goods at high prices, and the margin between the raw product and the manufactured article (I quote margarine only) is astounding.

I attach hereto a copy of the Scottish “Bulletin” of February 5, 1940. It reads:—

“Margarine Will Be Dearer—

Prices of margarine, selling at more than sd. a pound, are to be increased by a penny per pound, when present packed stocks are exhausted. This will mean that the maximum price of margarine which is fixed by the Margarine Manufacturers’

Association in consultation with the Ministry of Food, will be 9d. a lb. instead of Bd.”

Work it out for yourself. Margarine at sd. a lb. is £46/13/4 ner ton, and mar garine at 9d. a lb. is only £B4 per ton!

The editor calculates 5 tons of copra will produce 3 tons of oil alone. (Let’s leave out the residue, and confine our selves to the oil.) There must still be 3 tons of margarine, in a lot of 3 tons of oil. It does not evaporate in conversion to margarine. Then that three tons of oil will, in the finished product, be worth in margarine, at sd. a lb., £140; and at 9d. a lb.. £252.

This, then, is why copra should be crushed in the Islands and, when crushed, made into the finished product of mar garine; and here is where the huge profits of the Combine come from. The raw product, copra or raw oil, will never rise higher than what the Combine is prepared to give for it.

The Combine buys 5 tons of copra and pays (on your figures) £66/10/-; for these 5 tons, produces 3 tons of oil, and has a valuable cake residue of 2 tons, and the cost of marketing the three tons of mar garine. Let’s put it high, at 25 per cent, off retail prices. On the sd. a lb. basis this leaves the margarine worth £lO5 per three tons and, with 2 tons of cake, valued at £7/10/- a ton, we find 5 tons of copra worth £l2o—or, per ton, the value of the copra is £24 a ton.

On the 9d. a lb. basis, 3 tons are worth in margarine £252. Again allow 25 per cent, for marketing. The three tons of margarine are now worth £lB9. The two tons of cake are worth £l5. The total is £204 for the five tons of copra—or £4O/16/a ton.

It will be seen that the Combine “makes” the price of whale oil and copra by its control of all crushers, in all European countries. No rise in price can ever be looked for on the raw product, copra, as it is controlled by the Combine.

The plain remedy is, crush copra in the Islands and also manufacture mar garine and soap in the Islands. Then only

can copra be given its true value in re lation to the manufactured products of copra.

Co-operative mills would pay for copra based on oil content as valued by the finished product, and it’s as plain as day-light that copra then would be worth 2 to 3 times its present Islands value.

The Combine’s profits of millions is not made out of buying and selling either whale oil or coconut oil, but is made out of the margarine value. The raw pro ducts are bought for the bare cost of production. The value skyrockets between that raw product price and the manu

factured product. Then why not let our copra remain in the Islands and follow the Combine’s example. Grow our own copra, crush our own copra, make our own margarine, instead of letting the Combine do it for us—and take our profit?

I am, etc.,

Ganibulu.

Vanua Levu, Fiji, 25/4/1940.

Mr. W. McMurtrie, who had been well known for many years on the New Guinea goldfield, died in Wau on May 16. He had been engaged in alluvial mining on the Watut River for some time and he was only 31 years old.

Mr. Tom Miller, 51, well-known in New Guinea as the manager of various coco nut estates died in Rabaul on May 17.