Chairman's Review of the World's Position:
Forecast for 1925
The fourth annual general mecting of shareholders of the Peng-Kalan Durian Estate (1921), Ld., was held at, the offices of Messre. J.
Bisset & Ca., Secretaries & General Managers," on Monday _afternoon, Mr. G, M. W. Hummel, Chai amin' of Directors, presiding, supported by Mr, E. C. Gill, Director. The total number of shares represented was 33,858 shares, and eix shareholders were present person: ly, Mr. H. V. Hummel, aca. Prevented the Secretaries & Gen eral Managers, and after he had rend the notice convening the meeting and the auditors' report, the Chairman said:—Before dealing' with report and accounts which, having been in your hands for ome time I propose asking you to take as read, I think thst perhaps you would Tike me to say something about our comnodity, the course of the market during the past year, and the present post tion and prospects.
When last I had the pleasure of addressing you, though the price of rubber was well below the highest for the year, it was not mater-Sally less "than the minimum or pivotal price aimed at by the Stevengon Restriction Scheme, and the statistical position was so much improved that it seemed not unreal vonable to expect a steady, and ater, a rising market. So far was this from being realized that in the early Spring the price commenced to fall and continued to do s0 rapid-until the low water mark of 92d. per Th, was touched, for one day ly, in the middle of June.
T have referred to the statistical position at the end of last year ay having been satisfactory, in bri that position wasi—World profluction for the year Tons
ord conadnption for the' eat tint eet 400,000 (3033) Block Im the Bast Stock in the United Kings Block in the United Star World's stock Estimated world production for veees s+ 408,000 estimated "World "consumption for W028 wese 400,000
Imother words, not only had more robber been consumed in the year then closing, resulting in u reduetion of recarve stocks by some 25,- 000 tons, but it was confidently anticipated that, without figuring on any material increase in eon-sumption, stocks would be further redueed during this year by 58,000 Vons, oF, on the expected Vasis of consumption, to no more than 28) months' supply. Formerly it was considered that four months' supply was the lewot that it was safe to work on.
The Attack on the Stevenson Scheme Genfidence in the outlook was in-reused. by the fact that the principal consumers in the United Slater "us well as in Europe had agreed that an adequate supply at a Tearonuble price was a primary necessity to thems that they could not expect this unless producers were obtaining a price that gave then @ reasonable return on their investment; and, what seemed even more important that the terms of the Stevenson Scheme were equity able, promised to do what was Reeveary, ud did not aim at the obtaining' of an unreasonably. high beice. From the latter one of the Jargeot tyre manufacturers in the United States dissented. When rubber was at its lowest Inst year this gentleman puttiely claimed the credit for having smashed "Restvietion." Be that as it may, it is Geniable that a "bear" movement in the early part of last your, such as was always interfering with the free development of the market, and which was made possible only by the very edneiderable free stock that was available, met with such success that it grew into " strong truck having for its final objective he forcing of the abrogation of the Bteveneon. Scheme. In the course of this campaign the principal doubly snd uncertainties that were made such extraordinarily success ful-use of were:—
(a) A Labour Government was in office at Home. Labour was opposed to anything savouring of protection that it would probably cancel the Restriction Scheme altogether.
Producers in Malaya with young or immature areas claimed Te-assessment on the grounds that they had been inequitably treated 2s compared to owners of mature rabber. It was sai that reassessment would mean greatly increased output. The Dutch Indies were going enormously increase on their 1923 output.
(8) Consumption in the United States would be very materially less than in 1923, when there had been general over-produetion, particularly of tyres. 'The Rubber Growers' Associ tion plan for a Central Selling Organization to counteract cooperative buying by all United States consumers hung fire Jong that it was contended that @ifficulties of reconciling various interests bad proved insurmountable, What actually happened respect to all these "bear" arguments, taking them in the same order, very briefly was: (a) The Labour Government a nounced that it had no intention of interfering with the Stevenson Scheme. (b) A re-assessment favourable to young areas and reducing the maximum for mature troco to 400 1b. por acre was agreed to.
The assessment reduced Standard Production by some 24,000 tone.
Dutch Indies production more and had been anticipated, indication of increasing by
say from 140,000 tons dry.
Taking doringgghe first six months of the year only 155,000 tone as compared to 100,000 during the some period of 1923 it seemed as though the United States was going to take materially less. It then developed however that consum-ere there had been imitating the camel in times of stress, eating their hump or emergent ey reserves. Since then they have been importing at the rate of 175,000 tons for the remainder of the year, or say, 880,000 ters for the entire The Robber Growers' Aveociatien announced the completion of a Central Selling Scheme which "hed met with the ap-Proval of all concerned, but as appeared that restriction was going to unaided do all that was requisite for the salvaging of the industry, it had been i definitely pigeon-boled.
In June the tide torned, initially the result of increased purchases by the United States. In August, because the price for the previous jowarrer had fallen below an aver-axe of Is/-, the export allowance! for Malaya and Ceylon was reduced to 55 per cent. The market considered this ae a final and defi anewer to the oppeaents of rest tion, whose plaintive chorus had by this' time been swelled by the han ereon of the robber trade Malsya, ind many who ought to have known better, who had sold short around bottom prices end were already beginning to feel the pinch, In the result quite a number of so-called dealers failed and it] is satisfactory te record that pur-claves to cover their shortages materially assisted price recovery. In September the news, which I have already mentioned, about the Feduetion in Standard ' Production leonsequent om re-asemment had 9 [strong tonic effect. In November [Owing to the average price mot hat ing averaged 15/34 for the preced: ing quarter the export allowance was reduced to 50 per cent. This, together with a mach improved {Continental outlook and a very acjive demand from the United carried the price to I6/6d
Text read from the printed page and cleaned; old type leaves the occasional error.