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Tuesday, 2 April 1957

Mr WIGHT (Lilley) .- I fully support the bill. I believe that its introduction indicates a great sympathy for the cotton industry on the part of the Minister for Primary Industry (Mr. McMahon). This bill is only a simple machinery measure, but the effect of it is to remedy certain anomalies that were made apparent last year to the Cotton Marketing Board and to the growers, when some difficulty was encountered under the law in providing interim payments to the growers. Those interim payments were so necessary that this machinery bill was introduced really to clear the passage so that the payment of the bounty will be made a more simple procedure and those difficulties will be solved.

I am taking advantage of the introduction of this bill to support suggestions that have been made by the honorable member for Capricornia (Mr. Pearce), who has, over a period of some years, tried hard to get more sympathetic consideration and support for the cotton industry in Queensland.

The cotton industry is, even at this moment, spreading into New South Wales. I understand that there have been experimental plantings in the Moree district, and although the season has been a bad one. there are indications that cotton can be grown successfully in that area. I believe that if growers of cotton are given encouragement, the industry will spread from the Dawson and Callide valley areas of Queensland to the Darling Downs, and that if the industry is given an opportunity to stand on its own feet cotton eventually will become one of the great alternate crops that are so important to the economy of Australia.

At the present moment, the cotton industry is in a very bad state. Indeed, it has never been in a really strong and healthy state. It always has been undercapitalized and has never been given a proper chance to establish itself. One of the best moves in the encouragement of the industry was the introduction by this Government of a subsidy, or a guaranteed payment, in respect of seed cotton. But the industry is still ill, as is borne out clearly by the fact that, in this year alone, the Government will be paying to it a bounty of £125,000, and the market value of the crop is less than the amount of bounty. The market value of the crop is £114,000, which means that the growers will, receive for their efforts in the last year, a return of £239,000, of which some £125,000 will be government subsidy. Does this not indicate that there is something wrong with the industry? Does it not suggest that we now, as a government and as a parliament, have to make up our minds whether we are going to abandon the industry, as it was abandoned by the Chifley Government, or whether we are really going to take action to establish it in such a way that it will be able to stand on its feet within a period of a few years? 1 believe that anybody who examines the situation that exists in the cotton industry to-day will agree with the honorable member for Capricornia that the industry could be made to stand on its own feet, and that it could be a very great success.

Let us examine the reasons why we have to pay £125,000 by way of subsidy and why the growers. will receive a total of only £239,000. Of the cotton that was picked in the 1956 crop, 40 per cent, had no market value and could not be sold. Nearly 900 bales from last year's crop are still on the hands of the Cotton Marketing Board because there is no market for cotton of that grade. Last year, 46.74 per cent, of the crop could not be sold. Let me cite the figures from 1950 until the present time. Of a total of 806 bales produced in 1950, 427 bales to be sold had no market value. In 1951, of a total of 1,124 bales, 227 bales had no market value. In 1952, 648 bales of a total of 1,483 bales were cordage and bedding grades and had no market value. In other words, those bales did not attract a price. In 1953, which was the best year, 4,229 bales were produced and 662 bales were of cordage and bedding grades which attracted no market price. In 1954, 479 bales of a total of 2,819 bales were of unsaleable grades.

Coupled with that, we have been faced this year with the fact that the United States has been dumping cotton on the market of the world. With 10,000,000 bales of cotton being dumped, the price of cotton has fallen. In Australia, this cotton is being sold at world market price. In other words, the price of cotton has dropped from 36 cents per lb. on the world market to 25 cents, per lb., and the Australian growers are being expected to sell to the Australian manufacturers, at the world price of 25 cents, the cotton that they have produced. We know that certain firms in Australia such as Davies Coop Limited, Bradford Cotton Mills Limited, and Bond's Industries Limited, have been able to benefit by the fact that the dumping of American cotton has brought the world price down. Six million bales have already been unloaded by the United States; consequently, our cotton spinners and weavers have been able to buy this cheap cotton on the world markets. Yet the community in Australia has not benefited by the increased profits these firms have been able to make through being able to buy this dumped cotton. These firms are holding out and wanting to buy the Australian crop at this depressed world price.

I wish to commend the Minister for Primary Industry (Mr. McMahon) for having taken action on this issue. I understand that he will act as umpire when negotiations are opened concerning the sale of the present Australian crop. I sincerely hope that, in view of the fact that these spinners and weavers have profited at the expense of the Australian cottongrowers by the dumping of 6,000,000 bales in the world's markets, the Minister will see to it that the Australian growers get a more adequate return for the crop that they have been able to produce. We know that there are another 4,000,000 bales of United States cotton yet to be dumped on the world market, so that we may expect that next year there will again be a depressed price for cotton on the world market. All of this suggests still further that we must give serious consideration to the situation of the cotton industry, and that we must determine whether or not we are going to save it.

I believe that cotton has a future in this country if we take firm action in the governmental sphere right now. It is of no use delaying such action and leaving it to next year to make known our determination. The honorable member for Capricornia made it clear that a great volume of cotton was being picked late in the season because of the lack of mechanization on the farms. He suggested that one of the first steps in solving this problem was to ensure that there was adequate mechanization on the farms, and that greater areas were planted. I believe that this could be achieved if the Government encouraged primary producers to plant greater acreages of cotton. I had the pleasure of travelling through the electorate of Capricornia, as it was prior to the last electoral re-distribution, with the honorable member, and of meeting the people who were growing cotton. We saw plantings of 500 acres, and we met people who were contemplating putting in more and more cotton because the year was a good one. If we encourage growers to plant more cotton, I believe that they will do so. In my opinion, plantings should be of a minimum of 250 acres. If we can get more plantings and greater confidence in the industry, there will be increased mechanization.

We can give such encouragement if, right now, the Government announces in mis Parliament that it proposes to extend, for five years beyond the 1958 crop, a guaranteed price for seed cotton of 14d. or more per lb. Personally, I believe that 14d. per lb. would be adequate. If we can guarantee a return to the growers up to the 1963 crop, they will have some encouragement to make greater plantings. More plantings and greater concentration of plantings will reduce, to a great degree, the problem of picking, because the pickers will not have to travel vast distances to pick cotton on such small acreages as are being sown at the present time. An extension of the guaranteed price would encourage the growers to invest money in the industry and to buy the International Harvester or the John Deere type of cotton picker to which the honorable member for Capricornia referred. If the growers can be sure of a guaranteed price, mechanization will follow. Earlier in my speech, 1 referred to the fact that this year 40 per cent, of the crop was of no value. That percentage of the crop could be reduced considerably, however, if the Queensland Cotton Marketing Board could obtain the new type of lint-cleaning machines. With a lint-cleaner, it is possible to increase the value of the cotton by improving its quality. Bedding and cordage cotton has no market value as a commodity because there is no demand for it, but by lint cleaning it could be improved to a standard acceptable to the weavers.

I have brought into the House some samples of cordage and bedding cotton. When it has been treated by the lint cleaning machines, much of the trash has been removed and it qualifies as weaving or spinning grade of cotton. If the Queensland Cotton Marketing Board were to install these machines in ginneries, much of the lower quality weaving cotton could be improved by the elimination of spots and specks of discoloration. Cotton so improved in quality would be acceptable to Australian spinners and weavers, and would command better prices. The use of these machines would improve the quality of the lower grades, thus enabling the board to supply cotton of a high standard.

About 900 bales of cotton of bedding and cordage grades, on hand now, cannot be sold. There is no demand for it. If that cotton were put through a lint-cleaning machine, 75 per cent, of it could be turned into weaving cotton, and could be sold for no less than £9,450. About 70 per cent, to 75 per cent, of it could be lifted to spinping and weaving grades. Other grades of cotton, which are already in the spinning and weaving class, could be improved to a quality that would return £1 to £2 a bale more than it is worth now.

The Queensland Cotton Marketing Board is not asking the Commonwealth Government to lend or to give it money to buy lint-cleaning machines. It is prepared to stand on its own feet. It is merely asking for a guarantee by the Commonwealth Government through the Commonwealth Bank to allow it to procure such machines. I visited the ginnery at Whinstanes, Brisbane, recently and machines in use there were built in 1917. They are obsolete and out of date. It is no wonder that the Government is paying a subsidy of £125,000 on cotton, much of which cannot be sold.

We should do our best to make the cotton industry successful. Let us give a guarantee to the Commonwealth Bank so that the board can buy the machines and make Australian cotton saleable on the Australian market. The actual price of a lint-cleaning machine is estimated at £80,000. If the Government has sufficient courage and believes, as I do, that the cotton industry is worthy of support, it will give the board the guarantee I have suggested. It will not ask the Queensland Government to do so because that government would try to make a political football of the cotton industry, and would destroy it.

Let us be courageous, and take the step that would re-establish the cotton industry. Let us give it a chance to stand on its own feet. We can do that merely by adopting three measures. The first is to give to the growers a guarantee on the price of seed cotton for five years beyond the 1958 crop. That would encourage the farmers to plant greater acreages and to purchase machinery. The second step should be to give a guarantee to the Commonwealth Bank so that the Cotton Marketing Board could buy new lint-cleaning machines. That would give further encouragement to the growers because they would know that a greater volume of their product would be sold, and would not lie idle in the ginneries at Rockhampton and Brisbane. The growers would have a feeling of security if they knew that their crop would be marketed.

As a third step, I suggest that the Government should take into consideration fluctuations in the price of cotton caused by the dumping of cotton by the United States of America. The marketing of 10,000,000 bales of cotton has reduced the price from 36 cents to 25 cents. Once we have adopted the first two measures T have suggested, we must seriously consider an Australian price for cotton. Normally, cotton coming into Australia would attract a tariff of Hd. Spinners and weavers who are buying it on the depressed market at rock-bottom prices are importing it under by-law. They have been able to exploit the situation to their own ends, and have not passed on to the public the benefit of the lower prices they are paying. The price of cotton goods has not been reduced in Australia. Prices are being maintained although the raw cotton is cheaper. If the spinners and weavers are not prepared to reduce prices, they must be prepared to recognize the claim of Australian cottongrowers to a fair price for their product.

I am glad that the honorable member for Lowe (Mr. McMahon) is Minister for Primary Industry because I know that he is most sympathetic in his approach to the problems of primary producers. Since he has assumed office, he has given consideration to each branch of primary production, and has done his utmost to ensure that their problems are solved. His work on the tobacco industry in Queensland will be a monument to him. The fact that the sale of the tobacco crop to Australian tobacco manufacturers has been guaranteed is largely due to the work of the present Minister for Primary Industry.

Now that he is tackling the cotton industry's problems, I ask him to give consideration to the points that have been made by the honorable member for Capricornia (Mr. Pearce), whom I support. I do not agree with the honorable member for Capricornia entirely in all his suggestions. His contention that the improvement of unsaleable cotton should be handed over to the Commonwealth Scientific and Industrial Research Organization would do no harm, but I suggest that if 75 per cent, of the unsaleable cotton can be made saleable by merely guaranteeing to the bank the funds to enable the Queensland Cotton Marketing Board to buy lint-cleaning machines, this is a more practical approach and it is the duty of this Government to give that guarantee.

If the Government does not do so I say that, without a shadow of doubt, we shall be betraying the taxpayers of Australia, because if we have another bad season next year, we shall have to pay £125,000 or £130,000 by way of bounty. If, on the other hand, we are able to sell more of the crop, the bounty will be reduced. If the Australian cotton-growers can get better prices for their cotton, the burden on the Australian taxpayers for the payment of bounty will be reduced. I predict that with the machines I have described, which would cost the Government nothing, the Australian cotton industry could establish itself on a sound basis, and make cotton one of the really great Australian rotation crops.

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