Official Dithering Fatal To

Copra Plan

Marketing Board Still in Mid-Air, After Five Months' Talking

FIVE months have elapsed since the South Pacific Copra Conference sat in Sydney to consider the position of an industry that, even then, was in a highly critical situation; and although, week by week, since then, there have come from all parts of the South Pacific . the most urgent pleas that something of a practical nature shall be done, the politicians and officials who organised and constituted the conference, have achieved precisely nothing.

Here in Australia, month by month, we have pleaded for some reassurance—some information, at least, as to what the con ference really proposed and how it was planned to set about the protection of the industry and the salvation of indi vidual planters. We were fobbed off with ministerial statements.

We heard that there was to be a South Pacific Copra Marketing Board, with headquarters in Sydney, a Territorial Industry Board in each of the different territories, but we could obtain no infor mation concerning the powers of these Boards, or how or when they were going to function.

Now, it appears that a complete detailed report of the Copra Conference has been in circulation among certain interested parties in the various terri tories for at least two months. We received a copy of it from an Islands correspondent in mid-April; and the report itself was finally published in detail in Rabaul, on May 9. Until then, the men who were most vitally inter ested—the planters and copra-buyers— were given no information.

The report will be found, published in detail, on page 16 of this issue.

There apparently was not the slightest reason why this report should not have been made available in February and March to the people interested, so that at least they might have the opportunity of studying it. But Australian Official dom said “No!” That is typical of Aus tralian officialdom. Is it any wonder that the Australian people, as indicated in the recent general election in NSW, will cheerfully do anything to their pre cious politicians, short of cutting their throats!

IF this report had been published for the reassurance of the interests con cerned, and acted upon with rea sonable promptitude, something practical and helpful might have been achieved.

As it is, so much time has been wasted, while politicians and officials have dith ered about, that planters and copra interests may be pardoned if they regard the whole plan now with cynicism, and proceed to tear it to pieces.

Like all plans that are hurriedly com piled to cover a set of conditions that are without precedent, there is much in this plan that is open to criticism. Prac tical men need only study the details set out on pages 16 to 19 to note obvious shortcomings.

The powers that are to be given to the local Territorial Boards are rather start ling: and one is appalled by indications of the size of the organisation and staff which will be necessary to take care of this copra pool—and which, of course, are to be provided from the proceeds of the pool, at the expense of producers.

There is nothing to show that this Mar

keting Board has any guarantee of the thing that is vital to the success of the whole plan—namely, shipping space; and there are indications that the whole sys tem of assembling, controlling, storing, shipping and marketing the copra is to be in the hands of officials, and that the various big firms who usually handle and market the copra are to have no right of entry. The Marketing Board is to have power to form an advisory com mittee of merchants to advise and assist them when such a thing is considered

necessary, and arrangements may be made between the Marketing Board and merchants for services to be rendered by the latter on a basis of remuneration to be agreed upon. But all this clearly is entirely at the discretion of the Market ing Board which is to have plenary pow ers in the copra industry.

All these obvious shortcomings, how ever, could have been forgiven or accepted if the plan had been pressed on with promptly. It did at least repre sent an intelligent and co-ordinated effort to deal with a situation of great complexity and to save an industry that, viewed against the prosnects of the post war period, is well worth saving.

BUT the various parties concerned—we do not attempt to allot the blame, because we do not know who is responsible for the delay—have allowed matters to drift on for so long that it is

now most unlikely that anything of a really valuable or practical character can be achieved.

The main obstacle now in the way of the proper functioning of a South Pacific Copra Marketing Board is that the prin cipal copra interests concerned, finding themselves desperately up against it, and unable apparently to depend upon con certed Government action for any kind of help, went grimly ahead, months ago, and made their own arrangements. In other words, the South Seas copra indus try, while still in a deplorable condition, is now well on the way to saving itself.

Take, for example, the position of that section of the industry represented by the far-flung interests of W. R. Car pener and Co. Ltd.: This firm handles copra which it either grows on its own plantations, or acquires from closely related companies and firms in the Man dated Territory of New Guinea, Solo mons, Fiji, Tonga, Western Samoa and the Gilbert and Ellice Islands. As every one knows, when war broke out, this firm operated three steamers of its own, which carried its copra from the South Pacific to Europe and America. After

war broke out, the firm’s three steam ers were taken by the British Govern ment and W.R.C. and Co. were in the position of all other South Seas mer chants—they had to depend upon any freighters they could get hold of for the removal of their copra.

But, while many interests sat down and wailed, two of the principal companies affected—Burns, Philp and Co. and W.

R. Carpenter and Co.—proceeded to make other arrangements. Burns. Philp and Co., having vast and world-wide shipping connections were able to char ter enough freighters to keep their copra moving to the few markets left open.

W. R. Carpenter and Co. went off to the US and succeeded somehow in induc ing shipowners to sell a couple of freight ers. The firm also took a bold and reso lute step—and one which has done more than anything else to give new hope to the South Pacific . copra industry—it assembled sufficient American capital to build a copra-crushing mill near Van couver, sufficient to handle at least 30,000 tons per annum, and it found in North America a market for the products of that mill. To-day, therefore, W. R. Car penter and Co. Ltd. have in the Pacific two freighters which they own them selves, and a third ship which they have chartered, which is carrying their copra and their clients’ copra from selected ter ritories to the mill at Vancouver and to any other North American market which they can find.

It is only a guess—but it would not be surprising to find that the two big firms (Burns. Philp and Carpenters), depend ing entirely on their own vigorous man agements and their own resources, are to-day shifting out of the South Pacific, copra tonnage totalling not less than

100,000 per annum. That is a remark able achievement, in the circumstances.

NOW, turn back to the report of the Copra Conference, and try to see how the new self-dependent opera tion of these big firms are going to fit into the framework of that plan. Obvi ously it cannot be done.

Messrs. Burns Philp and Messrs. Car penter cannot be expected to tamely per mit their operations to be taken over now by a bureaucratic Marketing Board, which probably knows no more about the delicate and complex business of marketing copra than does it about the bimetallism theory. The big firms have had to fight like tigers to keep the industry alive —and it is not to be ex pected that now they will tamely sur render their gains to the official Mar keting Board.

IF this plan had been produced and brought into operation, say, in Feb ruary or March, we might have applauded it, with all its imperfections, and everyone concerned might have made an effort to help it along. As it is, we anticipate that, owing to the fatal delay and procrastination, obstacles of a serious character will be raised now bv the big firms, and that even the small planters who have been able to survive will be inclined to look upon the Gov ernmental plan with a jaundiced eye.

THERE is one most interesting little item hidden shyly away in the con ference report. It is as follows; “Australia shall continue to imnort from Fiji and the Western Pacific High Commission areas copra not exceeding the quantity that consumers in Australia

wish to buy from those areas, provided that the producers’ and consumers’ organisations are owned and controlled by the same organisations. Such trans action, however, must pass through the Marketing Board.”

This, of course, is put in to protect the Lever interests. The Australian copra crushing mill of the Lever combine re ceives up to 30,000 tons per annum of copra produced on the Lever plantations in the Solomon Islands. Levers are a British firm, and the Solomon Islands are a British Territory. More than once during the past year the question has been asked why Australia should be im porting at least 20,000 tons per annum of Solomon Islands copra for the Lever mill while the copra industry in Aus tralia’s own Pacific territories is lan guishing. A certain bitterness has been brought into the comment because the Australian and BSI Levers are part of the Unilever Combine which has been for so long controlling the world copra prices for its own benefit.

However, argument in favour of allow ing the Lever mill to do what it likes with its own copra from the Solomon Islands might prevail; but, if that argu ment is accepted by the Copra Market ing Board, what is it going to say to Messrs. Carpenter and Co. when that sharp-eyed firm demands the same privi leges—namely, that it shall be allowed without interference, to carry its own copra from its own plantations in New Guinea and the Solomons, to its own crushing mill in Canada?

IN view of official dithering and pro crastination, it will not be surpris ing to find that the public has lost all faith in the idea of a Copra Mar keting Board.

One now is more inclined to say; “Bureaucracy should keep its hands out of this highly specialised industry and, instead use whatever Government funds are available to subsidise planters, trad ers and shippers in making their own arrangements for developing new mar kets and saving the industry.”

(Continued on Page 16)

r T'HE following is a full summary of the conclusions reached and recommen dations made by the Pacific Copra Conference, which met in Sydney in December and January last, under the chairmanship of the Australian Terri tories Minister (Mr. Collins ) and was attended by delegates from the follow ing:— Australian Government, giving repre sentation also to Papua, Mandated Terri tory of New Guinea, Free French Colony of New Caledonia.

New Zealand Government, giving re presentation also to Cook Islands, Man dated Territory of Western Samoa, Free French Colony of French Oceania.

Fiji Government and High Commission for Western Pacific, giving represen tation also to Solomon Islands, Gilbert

and Ellice Islands, Tonga, and Anglo- French Condominium of New Hebrides. rOM the information available it appeared to the Conference that having regard to the reduction of production that might be possible in certain areas the undermentioned quan tity of copra would require to be dis posed of in the British and associated areas in the Pacific during a period of twelve months:—

The figures shown do not include present accumulations totalling approxi mately 38,000 tons which are awaiting shipment in the various areas.

A survey of markets indicates that during the forthcoming year there are prospects of disposing of the following quantities of copra produced in these areas to the countries indicated here under:—

The Conference considered the possi bilities of opening up new markets, extending present markets and of finding further uses for the product of the coco nut, and arrived at the conclusion that any organisation that may be established to handle the marketing of copra should pay particular attention to investigations of this aspect of the problem. One pro posal for the utilisation of copra in new directions which was submitted to the Conference seemed to be worthy of further investigation. This and other projects should be followed up by any marketing organisation which may be formed.

The Conference is of opinion that the possible methods of dealing with the present situation of the copra industry are:— (1) Leave the position as it now stands.

After investigation by the Confer ence it was decided that this would not be satisfactory. (2) Store copra for an indefinite period with a view to obtaining markets when available, even if that in volved holding until after the war.

This, upon examination by the Conference, was considered un sound at this stage, both from the point of view of the finance in volved and the economic interests of the territories concerned. (3) Joint marketing organisation with statutory authority. This is re commended by the Conference for the following reasons: — (a) that on the evidence examined by the Conference, the view was taken that production would exceed the quantities that could be marketed. (b) any contract for the sale of a stipulated quantity of copra to the United Kingdom Govern ment would obviously have to be shared by all British and associated territories in the Pacific. (c) that an agreement by the Governments of the United

Areas controlled by— Tons.

Commonwealth of Australia .. 79,000 Dominion of New Zealand .. .. 35,000 The Colony of Fiji and the Western Pacific High Commission 76,000 Total 190,000

Tons.

United Kingdom .. .. 90,000 Australia 27,000 Mexico 30,000 Canada 15,000 Total 162,000

Kingdom, Australia and New Zealand to assume some prac tical financial and economic responsibility in the Free French territories of the Pacific will add approximately 30,000 tons annually to the quantities to be marketed. (d) that because of the shipping difficulties, economy in the use of the ships that can be made available is essential. This can be effected only by an arrangement in the form of a central control including the pooling of shipping facilities. (e) that tne production relative to the marketing possibilities is such that some form of control of production is essential. This can only be arranged by a joint approach by the various territories.

If, of course, the United Kingdom Government fails to purchase substantial annual quantities the proposals would have to be reconsidered. Cables re ceived from the United Kingdom, how ever, suggest that this contingency is unlikely.

If the recommendation be approved, the following is an outline of the scheme that might be adopted:— There shall be a copra marketing board to be known as The Pacific Copra Marketing Board (referred to in these notes as “the Marketing Board”), which should be located in Sydney.

The Marketing Board shall be repre sentative of the three principal Govern ments concerned, namely, the Common wealth of Australia—on behalf of the Territory of Papua, the Mandated Terri tory of New Guinea and New Caledonia (Free French Administration), the Dominion of New Zealand—on behalf of the Mandated Territory of Western Samoa, the Cook Islands, Niue Island and French Oceania (Free French Administration); the Colony of Fiji, and the Western Pacific High Commission— on behalf of the British Solomon Islands Protectorate, the Gilbert and Ellice Islands Colony, the Kingdom of Tonga and the Condominium of the New Hebrides.

The Marketing Board shall be com posed of three or four representatives as shall be determined, but each of the three principal Governments referred to in the previous paragraph shall have one vote only.

The Marketing Board shall be em powered to form an Advisory Committee of merchants to advise and assist when deemed necessary by the Marketing Board.

A Territorial Copra Industry Board or Boards, hereinafter referred to as the “Territorial Board” to be appointed by each of the three Governments party to this agreement.

The Territorial Boards in their own territories will act as agents of the Marketing Board.

The functions of the Marketing Board shall be:— (a) To acquire by agreement with the Territorial Boards of the respective territories such copra produced within each of the respective terri tories as may be determined. (b) To market copra so acquired. (c) Where deemed fit to arrange with the Territorial Boards for the marketing of copra within the areas controlled by such Territorial Boards. (d) To arrange finance and transport, including the chartering of ships necessary to the marketing of the copra from approved points of con centration in the Territories. (e) To investigate possibilities of addi tional uses for copra and where deemed fit to recommend to the

Governments which are party to the agreement proposals for the development of such additional uses. (f) To distribute to Territorial Boards proceeds of sales in accordance with the bases laid down. (g) To advise Territorial Boards of marketing conditions or trends of markets which would assist them in determining policy for the con trol of production if such be found necessary. (h) To make contracts and to enter into arrangements and to do such other things as may be necessary to enable it to carry out its func tions. (i) To appoint staff as may be neces sary and to determine the condi tions of employment of such staff. (j) To perform such other functions as may be allocated to it by agree ment between the three Govern ments from time to time.

In the marketing of copra acquired, the following conditions shall apply: (a) Proceeds of sales of copra ac quired by the Marketing Board, less charges, including administra tive expenses, to be credited to the funds of the Marketing Board and later allocated to Territorial Boards for distribution. (b) Australia shall continue to im port from Fiji and the Western

Pacific High Commission areas copra not exceeding the quantity that consumers in Australia wish to buy from those areas, provided that the producers’ and the con sumers’ organisations are owned and/or controlled by the same organisation. Such transactions must, however, pass through the marketing Board. (c) Proceeds of sales from the area of one of the units party to the agree ment to another unit party to the agreement will be credited to the funds of the Marketing Board at a price to be decided upon by the Marketing Board but such price shall not be greater than that for which copra of similar grade can be obtained from any other part of the territory making the sale or from any other territory. (d) If in an area controlled by one of the Governments party to the agreement, the price of copra is raised by the respective Govern ment to a price aoove world parity the full amount of such excess of such price over world parity shall be credited to the Territorial Board or to Government of the area concerned. (e) The proceeds of sales of copra shall be distributed to the Terri torial Boards according to the quotas to be declared and regard less of the territory from which shipment is made. (f) In crediting the Territorial Board with the proceeds of sales regard shall be had to grades of copra shipped over the period covered by the payment and copra held by the several Territorial Boards for

shipment at the close of such period. (g) So far as can be seen at present freight should be charged to the proceeds of sales and so in effect distributed according to the de clared quotas. If, however, this is found in practice to have any in equitable features as amongst the three parties to the agreement, the Marketing Board shall make such adjustments as are necessary to rectify any such inequitable fea tures. (h) Where necessary on account of shipping arrangements, the Mar keting Board may bear portion of the cost of storage and interest in respect of copra held in concen tration depots pending shipment.

This will not refer to surplus copra which remains the responsi bility of the Territorial Boards. (i) Arrangements may be made be tween the Marketing Board and merchants for services to be rendered by the latter arising out of the marketing of copra. Re muneration for any such services will, after negotiations between the Marketing Board and mer chants for services to be rendered by the latter arising out of the marketing of copra. Remunera tion for any such services will, after negotiations between the Marketing Board and merchants, be determined by the Board.

The Territorial Boards will furnish re turns to the Marketing Board containing such information as may be required.

For example:— (a) Quantities of copra held by the Territorial Board at the beginning

of each month and available for immediate shipment. (b) Receivals into stores during month. (c) Shipments during month. (,d) Quantities in store at end of month. (e) Estimated copra in Territory other than in stores at concentration points at end of each quarter. (f) All quantities shown in statements shall be allocated into grades to be specified.

Acquisition shall be arranged by each Territorial Board in its own Territory and agreements shall be made by each Territorial Board with the Marketing Board, under which the Marketing Board shall have sole power to market the pro duce acquired by it.

Quantities of copra held in store in each Territory shall be recorded at the date of the commencement of the Marketing Board’s operations. Estimates of normal production for me forthcoming year in each Territory will, at the same time, be arrived at and quotas established on tms basis, that is the share of each Territory of the sales made will be based on the relationship of copra on hand plus estimated normal production to total copra on hand plus total estimated normal production coming under the control of the Marketing Board.

If, upon the examination of data available at the beginning of the Market ing Board’s operations of estimated stocks that will be available, and estimated markets, it is agreed that there will be a surplus unsold, such surplus shall be me responsibility of the respective Territorial Board and not of the Marketing Board. These surpluses may be varied if and when found neces baiy, according to the trend of sales and prospective sales.

In amending any estimates which have an influence on quotas regard shall not be had to reductions in production aris ing out of any action by a Government or Territorial Board in pursuance of a policy for the reduction of production in excess of the allotted quota.

The sums to be credited or paid on acquisition shall be a matter for each Territorial Board. The Marketing Board may make lump sum advances to the Territorial Boards upon conditions to be decided upon by arrangement.

Territorial Boards in association with their Governments will be asked to agree that all action possible be taken to pre vent production rising above the present normal production in their respective areas.

The foregoing report expresses unani mously the views of the Conference.