European Markets?

Seeking Solution Of Copra Problem

How Shall We Find Compensation For The Lost European Markets?

By R. W. Robson

FOR weeks, I have been studying this South Pacific copra situation. It is as plain as the nose on your face that, unless some extraordinary step is taken, the South Pacific copra industry is going to be more or less wiped out.

This must not be permitted—not with out a fight, anyway. All the principal Territories now have alternative indus tries, but everyone of them still has a copra industry—there are coconut plan tations, where copra regularly is cut for sale, on every coraline island south of the Line. There are thousands of little trade stores handling that copra; hund

reds and hundreds of little vessels, trans porting it.

Copra is the cement which holds to gether the bricks of the economic struc ture in the South Seas.

There has been talk of Government re lief, and sustenance payments, and what nots. Mere stop-gaps, postponing the day of evil reckoning.

What is the use of giving “relief”, when at least half the world’s market has been wiped out? Hitler, to-day, squats on top of Germany, Austria, Poland, Czecho slovakia, Denmark, Norway, Holland, Bel gium, France and Italy—everyone of them, formerly, a large consumer 01 copra. Other countries, like Sweden, Spain and the Balkans, are also more or less blockaded. The British market has a limit.

That market will come back —some day.

But this war is going on for years.

Even if that European market was open, there are not nearly enough ships to carry the South Pacific copra—not when they can cut thousands of miles ofi their voyages by loading Dutch East Indies or Malayan copra.

Normally, the South Pacific produces 200.000 tons of copra annually. Under present conditions, production may be down 50 per cent. That leaves 100,000 to 120.000 tons to be sold, somehow, if a skeletonised industry is to be kept alive.

Europe (mostly Britain) might take 30.000 or 40,000 tons; there is a market in Mexico for another 30,000 tons or so.

And, after that, what? That was the problem to which I could see no answer, although I talked and exchanged letters with a score of people even more inter ested and bothered than I.

Obviously, there must be found either a new territorial market for copra, or a new use for coconut oil, on a vast scale.

That latter alternative is discussed elsewhere in this issue. There may be something to it. But new uses for coco nut oil cannot be developed in a week.

And weeks are very precious to the harassed coconut-planters, just now.

Where cn earth could one look for a new territorial market?

THEN I got what I thought was a brainwave. I was chatting with Sir Walter Carpenter, just back from the United States, and he told me of how he had been examining the Mexican mar ket.

“If only we could get into that United States market!” he remarked. “But they’re tied up to the Philippines—they take anything up to half a million tons from that group every year.”

“But why not?” I said. “There is a new relationship now between Britain and America—surely, it would be possible to put it up to Washington. There is nothing we need so much as dollar ex change, and nothing they need more than a continuing market for their petrol and cars and films. If U.S.A. would ad mit 50,000 tons p.a. of South Pacific copra, our industry would be able to carry on, and their Philippines industry would be scarcely affected.”

We discussed it at some length. Sir Walter jeered at the idea that I, or any one else, could induce the slow-moving Australian Government to hurry in a matter like this; but he admitted that, if the proposal were properly presented to Washington, there would be a fair chance of its acceptance.

“Give me authority to approach the

United States Government, and I guai antee I would at least have it fully con sidered”, he exclaimed, thumping his desk in characteristic fashion.

It was an idea. I could imagine no better copra ambassador than the rest less, tireless founder of Carpenter and Co. He made his original fortune, buying

and selling copra, and there is no man alive who knows more about the quirks and twists of the market.

So I sent off the following letter, im mediately, to the always-courteous Terri tories Minister, Mr. Howard Nock. May be it was impertinence: but someone has to try something. What’s the use of our all sitting around the South Pacific

copra industry, merely moaning? The

letter:— Hon. Howard Nock, M.P., Minister in Charge of External Territories, Canberra.

Dear Mr. Nock, —

Re Situation Of Copra Industry.

For many weeks past I have been giving con sideration to the condition of the copra industry, and I now wish to make a suggestion to you, which will, I believe, if acted upon promptly, give some hope of providing a new market for copra from the British Pacific Islands.

The position is well known to you now, I think. In ordinary times, the Pacific Islands south of the equator produced annually from 150,000 to 200,000 tons of copra. The market was for the most part in Europe, with a small proportion going to Mexico and a smaller pro portion still to Australia. As a result of the war, the European market is entirely closed, and the Mexican and Australian markets cannot take any more copra than they have been tak ing in the past. Furthermore, even if there were markets available in Europe, there are not enough ships to carry the product from the Pacific, half way around the world to Europe.

As a result of these depressed conditions, copra production in the Pacific territories has fallen very much, especially copra from native sources. But the great majority of European planters, unable to get rid of their labour and fearing to allow their expensively made plan tations to return to the jungle, are keeping on making copra in the hope that they may get some small sum for it. It is impossible to estimate present-day production in the British territories south of the equator. It probably is less than 100,000 tons per annum. There is no

market for this copra and, as you know, all the Islands stores are full to overflowing.

During the past three months I have discussed with all the interests concerned all the various plans put up to give relief to planters and traders in this desperate situation—but none of the plans, although some are very interesting, seem practicable. There just simply is not any available market for copra, or coconut oil, or coconut cake—and the old markets in Europe are not likely to be re-opened for a long time.

The only possible market which could give us relief is that of the United States. I have no doubt that you know the position there. By means of a processing tax, the United States protects the copra production of the Philippine Islands, about 400,000 tons per annum, against the competition of copra grown anywhere else.

Now if U.S.A. could be induced to open its gates to. say, 50,000 tons per annum of copra produced in British Pacific territories, a very great measure of relief would be afforded to the British communities in New Guinea, Papua, Solomon Islands, Tonga, Fiji, Samoa and the Cook Islands. From what I know of the con dition of the copra market in the United States, I believe that this quantity of British Pacific copra could be admitted without serious em barrassment to the American and Philippine interests concerned. This morning, I discussed the matter with Sir Walter Carpenter, head of W. R. Carpenter & Company, Limited, who has just returned to Sydney after purchasing in the United States two 5,000 ton steamers which he proposes to use as freighters in the Pacific.

Sir Walter while in the United States carefully examined the copra position, especially the market in Mexico, and the United States capacity for copra consumption.

Finally, I said to him: “If you had Common wealth authority, do you think that, knowing the copra industry as you do, you could get the United States Government to seriously consider a proposal that British Pacific copra should be admitted?” We discussed the matter for some time, and Sir Walter finally said that if he could get the assistance of the Commonwealth Government in putting up such a plan, he was sure that he would secure a favourable reaction in the United States. Then, after some further

talk, I secured his permission to put this pro posal up to you.

I want you to accept my assurance that this idea came from me—the plan was not suggested originally by Sir Walter Carpenter.

I am sure that if the Commonwealth Govern ment would authorise Sir Walter Carpenter to take up this matter with the United States, he could get the backing also of the Government of New Zealand and the High Commissioner for the Western Pacific (Sir Harry Luke, in Suva), both of whom are vitally interested.

I gathered in conversation with Sir Walter that he is very eager to give public service in some way in this time of crisis. For that reason alone I think that he would put his whole heart into the task that I have sug gested. But, in any event, he could be ex pected to do his very utmost, because the in terests of his own group of companies are so vitally affected.

Sir Walter Carpenter intends to return to the United States at a very early date on business connected with his own firm. I think that this would be an admirable opportunity for him to try to get the American market opened for some of our South Pacific copra.

I am dictating this letter immediately follow ing my conversation with Sir Walter Carpenter, in the hope that it will catch you before you leave Canberra, and allow you to place it before the Prime Minister.

I need not urge upon you the great urgency of this matter, nor express my belief that you will do your very utmost to assist the industry in the way proposed, if you think it is a prac ticable plan.

Obviously, of course, Sir Walter Carpenter in a matter of that kind, would have to work in close co-operation with Mr. Casey, in Washing ton. He recognises that. But in a matter of such importance to all the British Pacific com munities, we may be sure that we would have the utmost co-operation of Mr. Casey, once the Commonwealth Government approved of the proposal.

With kind regards, Yours faithfully,

22/8/1940. R. W. Robson.

The more I thought about it, the better I liked it. I decided I would combat De

partmental laissez-faire by following up

the letter with a couple of urgent, long distance, telephone calls. Within three days, I received this reply:— Dear Mr. Robson.—Thanks for yours of 22nd August. The Government have approved of my proposal to carry the copra industry along dur ing its depression, and I have arranged with three representatives of the three leading traders to meet me on Monday next. I am anxious to have their co-operation, and the details of the proposal will be available after it has been discussed with them.

Yours sincerely,

H. K. Nock,

Minister in Charge of External Territories.

Sydney, 24/8/1940.

Not a word about the United States idea, or any reference to the fact that, if our industry is to survive, we must find a new market, to replace a huge market that has disappeared. Only a complacent statement about the Aus

tralian Government’s sustenance relief

and pooling plan—a thing so feeble and footling that it would be funny, if it were not that it spells tragedy for so many good men in the Territories.

I went back to Sir Walter Carpenter, and told him about mv letter, and its

extraordinary reply.

“Was there anything impracticable

about that suggestion?” I asked. “Isn’t it possible to approach America in this way’

Or have I made an ass of myself?”

He gave a shout of laughter. “You’re old enough to know that Governments won’t hurry”, he said. “Of course, there should be a market available for us in America. But the proposal ties up with a few matters of international policy, and wants some thought and delicate handling: and it really is easier to start a relief and pooling scheme, with much expense and lots of officials, about the practical value of which I am very doubtful.”

Later on, I got some details of the copra relief and pooling plan. They are printed below. Read them' and weep!

THE conscientious Mr. Nock is now away electioneering—he holds a border-line seat. All the indications, at the moment, are that Australia shortly will have a new Government, and a new Minister for Pacific Territories.

That may mean a new policy of relief for copra-growers. If it does, there should be a chance at last of getting con certed action as between Australia, New Zealand and the High Commission for

the Western Pacific —thus bringing into line the conditions of the copra industry in all British territories and colonies south of the equator. That is the only way in which this copra problem can be handled.

It was useless to look to the Menzies Government, in Australia, for any kind of lead—it was pathetically incapable of constructive effort.