MINUTES OF EVIDENCE. 



97 



23 September, 1919.] 



MR. JAMES WYLLIE. 



{Continued. 



11.904. That is not the capital of the farm? On 

 the outlay I think we call it. 



11.905. You answered Sir William by saying that 

 it was interest . upon the circulating capital plus 

 interest as you mentioned on horse lahour? I con- 

 sider that in a farm you have a certain amount of 

 fixed capital in the way of horses and machinery and 

 so on, and then you have your circulating capital. 



11.906. Still this charge is not upon circulating 

 capital, it is upon the cost of the crop ? Of course, 

 roughly speaking you may say that part of th" cost 

 consists of circulating capital. 



11.907. I do not wish to cross-examine you. I 

 merely want to get what in fact you had in your 

 mind in answering Sir William. Then if I may just 

 refer you to the tractor account. Farm No. 1,* again 

 on the subject of interest, you observe that you charge 

 interest upon the tractor on the left-hand side of the 

 account. It is in " Overtime '' tractor account for 

 2 years You charge interest on 350 at o per 

 cent., 17 10s. Then you credit the account 

 with the work done for this particular farm. 

 First of all you charge interest on the total cost 

 of growing the 100 acres. 9.3.5 7s. 5d., and you 

 have also charged it on an item of that cost? That 

 question has been raised, and I have considered it. 

 I have worked it out for my own satisfaction, and I 

 have come to the conclusion that where you are 

 charging interest on horses and interest on machinery 

 n-. we have usually been doing, if you take about 

 5 per cent, on one half of the outlay on the growing 

 crops, you arrive at a total figure which is about 

 equal to 5 per cent, on the total capital in the farm. 



Chairman: I will not carry the question further 

 because it seems to me you have charged interest on 

 the total cost and also charged interest on an item 

 or items in that cost. I will leave it to some other 

 Commissioner to deal with the matter. 



ll.fX'K l>r. /'>/./'<: You have already had your 

 attention called to the very wide differences in the 

 costs of production quite generally. We understand 

 that these statements are presented to us in order to 

 help us to form an opinion as to the cost which must 

 bo guaranteed in order to protect the producers 

 against loss. I think you recognise that as they 

 stand they carry us a very short way in that direc- 

 tion P I recognise the difficulty. 



11.909. Can you make any suggestion to help us in 

 that respect? I am sorry to say I cannot. 



11.910. I have no doubt it occurred to you your- 

 self in presenting these figures that they really do not 

 help us very much as they stand. How do you account 

 chiefly for these variations? I think I have already 

 tried to explain that. The variations are very largely 

 due to local conditions in the, way of the treatment 

 of the soil and the ability of the farmer. You will 

 find also that the weather has a certain effect. You 

 may find that the weather is much more suitable in 

 a certain district in a particular year than it is in 

 another district. You may find that the seed time in 

 one district is favourable and in another district in 

 the same year it may be unfavourable. Those factors 

 may make a certain difference in your cost. 



11.911. Do vou believe that these causes of, let us 

 say, abnormal! v high cost shift from place to place to 

 anv considerable extent? I should say they do. 



11.912. Will you let us know what has led vou to 

 form that, opinion? From my own experience I think 

 you will find it .is 90. If you take two adjoining 

 farms you might find in the case of one farm in one 

 vfnr that the cost will be higher than in the case of 

 the other and in the next year it may be the other 

 wav round. 



11.913. On account of seasonal difficulties pressing 

 more hardly upon one than upon the other? It is 

 what the farmer would call hick. 



11.914. My object is to find out whether, in your 

 opinion, averaging would help us at all You will 

 agree that averaging is a very useless method for 

 guarantee purposes, but do you think in relation to 

 crop-growing the movement of the difficultv year by 

 vear from one district to another would make averag- 

 ing of any practical value? No, I am afraid that 

 factor in too small to make any material difference. 



11.915. The difficulties really are pretty permanently 

 localised? I am sure of that. 



11.916. You suggested that a certain farm if I 

 remember rightly it was No. 26* should be excluded 

 from the calculations. On what ground was that ? In 

 this particular farm the wheat crop, which was costed. 

 was taken after bare fallow. It was heavy land, and, 

 of course, the cost of the following was very high. A 

 considerable part of that fallowing had to be charged 

 against the wheat and the average yield was com- 

 paratively low, so that you get a very high cost pt>r 

 quarter. 



11.917. That is a very common element in the cost 

 of wheat prodxiction, is it not a proportion of the 

 cost of fallowing? Certainly, but in thii case I think 

 you will find that the conditions were rather abnormal. 

 I thought this particular case might be interesting. 



11.918. I am taking this case just in order to try to 

 get at any views you can put before us as to the cor- 

 rection of these estimates? With this particular case 

 it was very poor clay land in Essex which was taken 

 over by a certain farmer. He has been working it for 

 a number of years back, and he has been sinking a lot 

 of capital in it in a way of liming it. mole-draining 

 it and manuring it. He admits himself that he is 

 growing wheat at a loss, but he is getting a return for 

 his draining and his liming and his manuring from 

 other crops, principally hay and peas. That is why I 

 mark this case as being exceptional as regards wheat ; 

 I thought it might he interesting, out I consider it is 



'of no value. 



11.919. Would you consider that a mistake is being 

 made in cultivating wheat on this land? It is im- 

 possible to grow these other crops, I suppose, con- 

 tinuously. 



11.920. That would be your answer: that wheat is 

 an essential element in the rotation even if it is 

 cultivated at a loss? Yes. even if it is cultivated 

 ;it a loss; that is the farmer's own impression. 



11.921. In an exceptional case like that the price 

 of tlie wheat would really be a very small element 

 in the whole conditions? Exactly. 



11.922. Are there any others of these cases that you 

 regard as very exceptional ? No, that is the only one 

 from the cultural point of view ; there are one or two 

 rases wTiere the crops had been weathered at harvest 

 and the return of course was very small. 



11.923. You have priced nil these crops ns if they 

 had brought the full price? Yes, that is so. 



.1 ,924. They have not been put in at what they 

 actually sold for but at what they would have sold 

 for if they had got the full price? In certain cases 

 we have put down what was lost. 



11.925. It is mentioned in one case? -I think it 

 ought to be in in two cases. 



11.926. I see a mention of bad weathering in two 

 cases. In those cases the amount of the return was 

 reduced, was it? Yes. These were put in as instances 

 of one of the risks in cereal growing ; that was the 

 point in putting these in. 



11.927. I see you have credited the straw in each 

 case at 1 a ton"? -Yes. 



11.928. Whet was the basis of that? We took that 

 a the standard Jtfter very careful consideration. We 

 wanted to arrive at something which would bo fair 

 between the crops on the one hand and the live stock 

 on the other. 



11.929. You are assuming that the straw was con- 

 sumed on the farm? Yes, and in cases where the 

 straw was sold off we have credited it at a much 

 higher sum 3 a ton, I think. 



11.930. Which was the controlled price, if I re- 

 member rightly? We did not credit the crop with the 

 full market price of the straw ; we assumed that there 

 would be some profit on the straw if you were coming 

 to results. We wanted to put in something which 

 would allow a certain profit on the straw as well as on 

 the grain, because in these cases the straw is grown 

 for profit as well as the grain. 



11.931. So that really there is no element that you 

 can fix upon which would help us in finding any 

 common measure for these prices, or any basis for a 

 recommendation of a guarantee? I find it extremely 

 difficult to generalise at all. 



See Appendix IV. 



