156 WHEAT PRODUCTION IN NEW ZEALAND 



weather simultaneously, for the wheat crop may not yet 

 have reached maturity there. These considerations are 

 strongly in favour of adopting the a priori conclusion 

 that factors operating from the supply side tend to 

 promote price steadiness. 



The inelasticity* of demand for food-stuffs applies to 

 the demand for wheat. Variations in price are not 

 followed by variations in consumption of corresponding 

 magnitude. It is true that in rye-consuming countries, 

 such as Germany, where the taste for rye-bread is 

 sufficiently strong to combat the forces tending to 

 promote the universal consumption of wheat-bread, a rise 

 in the price of wheat will be followed by the substitution 

 of rye-bread for wheat-bread wherever it is possible. It 

 is also true that in countries which consume wheat-bread 

 only, economy in the use of bread (much of which is now 

 wasted in New Zealand) will be practised should price 

 rise. That such was the case in New Zealand after 

 the rise in the price of wheat at the close of 1914, 

 was indicated by communications to the Press at the 

 beginning of the year, and the general complaints of 

 bakers of a fall in consumption. But, despite the action 

 of these two forces, the demand for wheat is fairly 

 inelastic, and the general tendency of factors operating 

 from the demand side is to promote price steadiness. 



That supplies are forthcoming with some degree of 

 regularity over long periods, is shown by a table giving 

 the European Weekly Distribution or Deliveries to 

 Consumption of Imported Wheat. The table is taken 

 from The Corn Trade News, of June 9th, 1914, and 

 shows the rate of weekly consumption (or distribution 

 from merchants' hands) of imported wheat over the 

 several months from August 1907 to May 1914. 



*By inelasticity of demand is meant the quality a commodity 

 possesses of retaining a fairly constant demand in all price 

 changes. 



