Zurich Herald, 1939-07-06, Page 7It cannot toe often be repeated that the chief condition of health for
the Canadian Live Steele Industry is the securing of satisfactory markets
r PACKERS.LIM.ITED
abroad for the aveSt l splus. To secure such. makets is a funtion of
CAr. �.Governments, and no.one will deny that in this matter, both the present
Government and its predecessor have been zealous, and successful.
but iiite ertihn experiment of the Federal Department of Agriculture, a small
_ TO TJn(lex the direction of
REPOT SHAIRE1OLD�:R5 has been carried on through the past year, of
shipping Dressed Beef to England, Weekly shipments have been made of
i„p met
25- eaxesses of Baby Beef. From the beginningthese shipments have has
t I is a conservative estimate t rat this nutlet has been worth 40 million with a good reception. For the first time Dressed Beef from Canada
The twelfth fisea'1 year of Canada Packers lLin19ted. ended Marolt 30h, l l axsper Year to Canadian Pig
l'.ruducers, sold at a price equal to that of the best home -killed Beef.
'1939. de 1 Y These shipments have already proved a demand exists for this
ration Bond Interest, and Income Tae. is $1,238,736.31 ri es production of Bogs in 198 showed a beat's class of Beef. Moreover, Baby Beef is a thatn the production of winch
Profit, after n 200 : are to $6.9per Share, ne spite of the high p G ,
'Equivalent, this 200,000 Shares, to i937. The decline was due to a single cause, viz, I Canada seems able to hold her own. Itis hoped
pe'dTplans
e s may
market wbe Made ould
s form.
q of sunt it has been to. distribute, liar- decline as compared lack. of feed was due to the crop failures of 19',6 and year to enlarge the volume of these shipments.1 of this t rpe of Beef If Out
lng the current- fiscal year, as regular Dividend $ 600,000.00 lack of feed. Thee 500 1 000 carcasses weekly
g b
that is, $3.00 per Share. 1937. trade might become most useful as a stabilizing ed(in 1927 through the merging of four `Phe intimate connection betW5en quaantiity of feed and Hog production require close co-operation
Canada Peelers was form )
Companies. The .cause for the merger was that for several years three of is brought home by•the following t
wo tables:—
e Companies had suffered severe Losses. By reason of these Losses, (a) Gra oma 1 eti tion ri tiie last 2 years,
fill Pe
'Working Capital was inucli reduced, and when dabedneessarrsforaa num-
Oats II g CtRAIN FRODUCTION
ed Common Shareholders were informed it won Y (000,000 omitted)
iter of years to retain Profits, fog the purpose of building up Working Wheat Barley Oats
Capital. In pursuance of this policy, no Dividend was paid on the Common 1930 1937 10938 1936 1937 1938 1936 1937 1938
Shares for 8 years,—that is until 1935. _____ -•— -- Since then, Dividends have been paid at the rate of ....$3.00 pee Share G6 76 143 17 22 29 50 77 101
er. year. Alberta
P i Capital ital. is now such that Directors feel justified out of this Saskatchewan 110 36 132 17 5 20 65 22 90
Werk ng p 26 45 51 19 35 31 20 43 41
ear's Profits' (_..,$6.19 per Share) in declaring, in addition to the regular Manitoba
dividend, an -extra Dividend, payable July 3rd, 939, of..._$1.00 per Share. Total West 202 157 i' 6 53 62 80 135 142 232
important replacement, has been made• in the Com-
pany's
—� 1 ' j,!4 16 17 67 74 82
During the yearthean 1 p replacement 31 t 1938)Ontario . 141 ` 20. ,r
Bonds. At end of th previous fiscal year; (March s , Quebec ' 1 1 4 4 4 47 36 38
there outstanding the following Bonds:— Q
probably take to b' ' in influence upon Cattle
the ra a mi between
prices in Canada. To develop it; wouldq '
Producers, Government agencies, and Packers, For in connection with it
I'rodu ,
many problems must be worked out, particularly that of regular deliveries.
Every new Live Stock problem, and indeed every old one, lends em-
phasis to the importance of this co-operation between shPr bucere govern
Govern-
ment, and Packers. To promote such co-operation
objective of all groups engaged in the Live Stook Industry'.
As a step towards this end, Canada Packers would welcome the ap-
pointment, by representative organizations of Producers, of a Director to
the Board of the Company. The duty of this Director would be to study
operations of the Peeking Industry from the Producers' standpoint, I e
would have access to all the reeords of the Company, and would be kept
informed in detail of its operations.
It is felt that this would lead towards a fuller recognition of the unity
of interest between Producer and Packer, and that from it might emerge a
broader plan which would embrace the whole Industry. If such a plan is
to be brought about it must first be tried with a single Company and the
Directors feel that Canada Packers, as the largest unit in the Industry,
should be the one to take the initiative.
At the approaching Annual Meeting, Shareholders will be :eked to
authorize the plan.
Another recommendation, equally important,
willT essubmittedto appointt he
e
Annual Meeting for the approval of pp
Director who willck represent the approximately 5,500 Employees. Of these 3,500
Canada Packers has. app
are hourly paid, and 2,000 straight timemenrano women).
small n ). Whatever
success the Company has enjoyed,
loyalty and efficiency of Employees of. all ranks.
In recognition of this Each for the sast 6 been yasafollows:liWhen. Profits
were
•$ 750,000.00 due January 2nd, 1939, Interest- rate 3i/� %
750000,00!, . 1940, " " 3% %
3,000,000.00 1946, 4
"°
"Total $4,500,000.09
• On January 2nd, 1939, the Serial Bond of -___$750,000.00, was duly,
retired.
Notice has now been given to call the $3,000,000.00 of 4% Bends em,
,July 3rd, 1939. These will be replaced by Serial Collateral.Trusb Deben-
tures, in the same sum, as follows: Interest rate 2 %
$750,000.00 due January 2nd, 1941,1942, " [[ 2x/s
750,000.00 1943, 21/20/0
" . "
0/0
750,000.00 " " " 1944, " " 2% %
e Issue " " „ placed in' advance.
The new Issue has been entirely
By this transaction, after payment of all charges,
includ-
ing _ 110,000.04
the call premium, a saving in Interest will be e $
After its completion, the Bonded Indebtedness of the Com- 3,750,000.00
pany will be
repayable in amounts of....$750,000.00 on the 2nd day of
January each year from 1940 to 1944 inclusive.
The average rate of Interest of the new Serial Debentures is 2.47
per cent.
Total Sales for the year were $77,225,732.65 "
Total Tonnage800,763,592 lbs
The. Net Profit, (:_.:$1,238,736.31_..-) is, therefore, equivalent to: -
1.6% of Series,
or toe(approximately) 16c per 100 lbs. of product 'sold
The products deriving immediately from iofthe Stock, .arare,
-Meassiand
Ey-Products. These constitute the main volume
busi-
ness. But many other products are dealt in,—for � apple Canned Goods,
Vegetable Oil products, Butter, Eggs, Poultry, Fish,
. -
Because of the special interest of the Producer, a separate accounting.
is kept of purely Live Stock products. P ofit was
100 lbs.
12c per
' On these for the year under review, i :
Profit on Hogs (average approximately 1000 lbs.)) $1.20
pex bend
"
it [[ Hogs (
Expressed in relation to Shareholders' Investment, Profits are as fol -
Shareholders' Investment approximately _.-.$18;000,000.00
Profits
Equivalent to 6.8% $ 800,000.00
Dividend .
Equivalent to 4.4%
The following is an analysis of Sales, ' sasaw sedd in terms of.
Expenses;
Profits
tierap Year Ended
ears to -' March March
}1'038 198-- 1939
924 81.2% 80.5%
3 1 . 2.7 2.6
8.9
8.8 8.6
5.2 4.5 4.4.4
.2 . .2 .2
.7 . .6
lows: -
1,238,736.31
Cost of raw materials, principally Live $tbc
Cost of materials and packages
Wages and Salaries, including Bonus
Expenses
Interest on Bonds
Taxes '
Total Cost of Product, plus Expenses....
Depreciation on Fixed Assets -
Profit from operations
Total Canada
219 180 350 "1.'72 83 102 272 268 371
HOG MARIETINGS
(By Province of origin)
1937 1938 Decrease
..Albert;
,Saskatchewan ..
Manitoba
Quebeca____ee
''-`Maritiines.
Total Canada' 3;986;3
986,206' 782,857
56e4723 217,152
20'' ' 250,055
5
,~fib 1.,031,497
83,087
, , 641,887
20.6%
61.9'
2.2•,
7.2
17.4
10.0 (iircrease)
4'245,535 18.5%
Grain production"one,year is; of course reflected in Hog production the, sharing has been followed. Tis p
following yeas+kr The Farmer breeds a nuncber of sows more or less in pro- ascertained, there is first allocated to Shareholders a sum equi-
portion to the amount of feet he . has in his bins after the harvest. And have been
h resultingTitters are Marketed to:12 months later. valent to 6 per cent of Shareholders' equity. Beyond that point Profits are
thee two tables immediately are compared; Province :by Pro- divided,equally between aisShareholders
at theand year-endend in the form of a
vinee fithwill be `seen the decline' is heaviest in the Provinces in which crop Employees' tax distributed
The B distribution for the past 6 years
97.2
1.1
1.7
97.8
1.0
1.2
100. % 100. %
Income from Investments .2 .1
Total Profit, including Income from 1.9% 1.3
Investments .
ne
Live Stock prices during 1938 were high.
The following graph sets forth market prices of Hogs and
1931:—
Bacon Hogs, f.o.b. Ontario Country points.
Good Steers, 1050 lbs. down, Toronto market.
k[ou
1931
12
11
l0
3
ecituu HMS
Aaa 199
cont[ 5,93
97.3
1.1
1.6
The mp oyees s •e has been as follows:—
By
Bonus. T e onus s been
as
By the same reasoning, .the much larger crop of 1 • Year ended March, 1934 20
500
ed by heavily increased Hag deliveries in 1939. This increase is not yet in [[ [[ " 1935
evidence. There heeenot,;bee-n time. Fax the sows were bred after the har- Y[ ,' " x936
t (.Au ust/Septembers, and early litters are not due to reach market etc ua " 1938
uixttl:lor thuir !s .f " 1939
F the first 5 ntontlt of 939 Hog ntarketings (compared to 19;38).
failures are most serious. f 1938 should be f
291,8
413,275
511,572
192,490
215,905
vas g
e.
Tor a rs ;,; � .
have been as folloWs cinQ," 1938 Decrease
100. %
1.6%
Cattle '`ince
January291,684 25.8%
• . •-.�L1G,� {,,,
February' 25,E F, 284,338 11.2
March339,7312,7 301,197
{:262,717
355 2.4
April 16,(1`ii1 301,'197 3.8 (increase)
May 2,7.1„.,
Total— 1480,291 7.0 °fo
5 months,; -__ 7.,377,505" . ,
It is expected that from Tune forward the increase will be substantial.
From August, 1939, forward,' exports of Wiltshire Sides should show
a marked increase, compared to the previous year, and if Canada harvests
another large crop in 1939, Bacon shipments in 1940 might for the first
time approximate the British Quota of _._.280,000,000 lbs.
This would.be a notable event in the Canadian Pig :Industry, but it,
would immediately introducea- new problem. For there is no reason to
think Canadian Pig production will stabilize at that exact basis. And if it
goes on increasing; an enlarged export Quota would be necessary to keep
the Canadian Pig Industry sound.
This consideration lends special significance to the discussion for the
renewal of the Ottawa Agreement, which must be held before. August, 1940.
It. is important to.remembet that in these discussions, British The Botia-
oson
tors have in mind chiefly the ;interest of their own Country.
P Producers,
which, in the Bast 7 chiefly
he purpose ofso pstimulating Pig. prful to Canadian o -
duction
'were conceived ch by e'hei the;Cana-
duction:in. England. _ It was reeli2{! those clauses vLo lt},&XsP B
dial} Fernley. But fax this a quid pro' quo was expected.Mutual advantage
was .the keynote of the Ottawa Co}ifexence, and the discussions were con-
ducted in an ,atmosphere of " goodwill. But nevertheless, there
d s a at the
time,' and there has continued, a feeling that' Canada: drove
(and in'fact got the better of the deal. This is a fact which Canadians should
keep;constantly irk' 'mind. ----
4 proposal vitallyaffecting the Ottawa Agreement has recently been
made in the Canadian. Parliament;—viz. to impose an Excise Tax upon
Vegetable Oils entering; Canada from .Great'. Britain.
Canada imports large quantities of . Vegetable Oils. She does so be -
'cause she needs them. They are used in the manufacture of two products,
Shortening and Soap. By the terms of the Ottawa Agreement, Vegetable
Oils from British sources are admittedfree, whereas from all other sources
they are taxed. This preference has had the result of diverting nearly all
Canada's. Vegetable Oil business to England.
Thi 'demand for a
' made to the'Vegetable
Ca a Canadian Governeeent. - The reason
etes back 2 years. At that
esign ri application was
assigned :was that such a Tax, by advancing the p'riee of Vegetable Oils,.
would bring about a corresponding advance in the price of Animal Fats,—
Butter, Tallow, Lard,—and so the. Fanner would' be benefitted.
The application was refer -,.to T e Canadian Tariff : Board,rand the
finding of this Board was tabled sec. s . .
reoomrriended an Excise --Tax of ..=:3c per lb. on;Vegeta le Oil t seentad in
Shortening; and .._.2c per , lb. on. Vegetable Oil uses p
. Ave
clause to implement this recopimendation was included in the Budget (sub-
mitted April 25th, 1939), but subject to the acquiescence of the British
Government:
The British Government demurred on' the following grounds:
(a) That British shipments to Canada of Vegetable Oil are large and
!,\,f
1932 1933 1934 , 1935 ' 1936 199 • 1939 ~ 1030"--•8111,
r
ii
10
•
4,19
5,25
5,11
4,47
1,29
4,94
121 1.09
5,79 5,04
0171
9.15
5.52
$1,879,567
The appointment of an. "Employee" Director is a natural development
of this Profit-sharing policy. In addition to promoteconceding thse se l oyees a og cal
right, the Directors feel it will further
ip
which is the true relation between Shareholders and Employees, and from
which the success of this business has to such an extent derived.
--A copy of this Report is forwarded to each Employee. As in previous
years, the Directors wish to thank Employees of all ranks, on behalf of
Shareholders, for work well done.
During the year quality of products has improved and cost of produc-
the adeclined. -rTltofetheeyear, and are the bestrevlidenceuofttheiloyalty
the satisfactory.scan
and efficiency with which the Company is served.
J. S. McLEAN,
President.
Toronto, 20th June, 1939.
The two early years depicted in the
inra ccs has the were the l ow edp rind t of he
depression. Since then a great adva p
in-
structive to examine the causes.
The graph reveals that the Cattle price dragged on bottom much longer:
than did the Hog price, and that the advance when it did come was Tess than
that on Hogs.
The reason is well known. Prices for both had been xtremeanin 8lo
be-
cause and
Canada produces a surplus of Cattle and of Hogs,
1932, no markets abroad could be found for those surpluses.
In the case of Hogs the situationehaats relieved by
y the was concluded Bacon gin
clauses of the Ottawa Agreement.
August, 1932. In Canadathe
clausesBacon were 9
33.
(At he epy othetst5yeear term,in Augst, 937, --they re -
hewed for 3 years. That renewal expires August 20th, 1940.)
' In the ease of Cattle, relief also
olbe came
from
shr _opening ing ofarkemarket
et
to which the"Canadian surplus co
United States. By the Trade Agreement of November, 1935, the Duty on
Canadian Cattle entering United States was
educed (on a Agreement rte l Qe o r
from ._..3c to ....2c per ib. And by the subsequent
938, the Duty was further reduced to .,..11/2c per lb., and the Quota in-
creased.
HOGS:
rices the British Bacon Quota, conferred by the
In respect of Hog prices, ,
Ottawa Agreement, was an event of the first magnitude. Probably no
single trade Canadian Farmee. When. Canada
theAgreement wasWith
ade, Flogs
im-
portance to the Canadian
were "selling in Canada for -.3%c per Ib. Within one year of the tante it came
into effect,•the price had advanced to....9c per lb. And since that time the
average price, year by year, has been as follows:—
(Bacon Hogs, f.o.b.
Ontario country eachits)
$7.86 pax 100 lbs.
1934
1935
1936 _.....,
1937
1938 .,..
3.21 '! tit Y1
8.09 ![ Tt ![
.8;60 " ,t !,
9,15 rY : rr (t
important. • `
(b) That Britain buys annually from Canada_...150,000,000 to ._160,-
000,00e More than Canada buys from Britain.
(c) That in view of this heavy adverse balance, the British Govern-
ment could not "conteinplate with equanimity" a further loss of.
trade.
(d) That the imposition of an Excise Tax would have the same effect
as a` protective Duty, and would therefore be contrary to the Ot-
tawa".Agreement which granted. FREE entry to Vegetable Oils.
(e) That the Tax, if imposed, would resultin 'a serious reduction of
imports of Vegetable Oil, aid the subsittion therefor of imports
of American Lard.. •
(f) That for this reason (because,:Anterican Lard would flow in) the
advance ofi the price o Ga an Ii eneee Tax wle ouldwould
be
vety
involve slight,a and
•terefore the prolasse+ t i would be derived. of a large and in
eat
e. that.export
t trade
deprived
portant export trade t Canada, and that foxeignLartl ,would be,
substituted' with little benefit to Canadian reeducate of Lard."
'The memorandum concludes as follows: -
"Attention should perhaps be called' to the special advantages afford-
ed to Canadian Pig Producers in respect to Bacon Ce� d Iamby
. Article V of the United Kingdom -Canada Trade ng eeent. These the
advantages. are obviously, very greater
present proposals are designed to secure in respect to Lard, which is
a relatively unimportant Pig By. Product. It should, moreover, not
be overlooked that if United Kingdom exports to Canada aresub-
stantially including
thediia Bacon and.of BHam omig t Kingdom
be affected."
Cana-
dian Produce,- includ g
In view of this gemur,.the tentative clause in the Budget imposing the
Tax was not implemented, and a serious threat to live stock producers was
thereby averted.
CATTLE:
-Reference has.already
Tradenade toathe Agr enient. benefit
Agreement Producers
can-
noof the i November,
pounced in 1938, and became effective January 1st, 39 39the Quota
. Under
its terms, supplemented by a defining' clause in February,
for Canadian Cattle was increased to ._..193,950 per year,—maximumper
quarter approximately ....50,000.
thisoutlet is best -evidenced by the fact that the
The importance of and
Quota for the first quarter was completed
!stet d' comn pleted onemonth,
onwith,n 6 weettf or Ex -
second quarter (beginning April)
Ex -
Ports of Cattle to United States for the year•to date, as compared to last
year, are as follows; X1939 938
299674i3 4,462
, 3
9,9275 3,046
,. 10,171
•16,8"40. 4,271
'7 �5" 4,369
'Total 92,509 16,319
, *Estimated
.
.l!.9tilYlatP.d
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Lilimilen•IMINIM.......*••••••••111•••••.•••Ma•MIN.
N TARP°
7t. UTDOORS
By 1010 BAKER
Examine The Lake
Shorelines should be carefully
studied by the anglers, remind the
guides. As the summer progresses,
the shoreline will drop and shal-
lower shore waters develop. Look
for inlets of small cold streams or
,,YsRbiu LTsuajjjY VOYA5-lyl,Rg -„,„„„
close to deep channels are the best
productive spots. Do not give up if
the lake itself is murky. Too many
fishermen, it seems, take one look
at the muddy water and turn away.
They forget that there are many
arms that lead back from the most
lakes and if followed, lead to good
fishing grounds. But all the guides
agree on this one point, that to,
much time cannot be spent on ex-
amining the lake. The average fish-
erman goes according to where it
looks good and not where it is real
good.
These guides should know what
they are talking about for, after
ail, they do get a chance to meet
every type of angler from the least
expert to the mastermind fisher-
man; and the questionnaire replies
came from guides experienced in
all types of fishing for all types of
Ontario fish. Now that you've
reached this far, it might be a good .
idea to read the above facts over
once again!
NOTE—Mr. Balser will be glad
to answer readers' questions or
discuss any particular subject you
wish.
GUIDES TELL ALL
Recently a questionnaire was cir-
culated among a large number of
guides in Ontario and the results
concerning lake fishing should be
of interest to most fishermen, es-
pecially those of us who have our
troubles rousing the big fellows.
Most anglers, according to the
guides, drag their lures too fast for
lake fishing; the slower the action
the bettor. Many use too large
plugs; smaller ones should be tried
but .don't forget to slow down the
action.
All disturbances must be elimin-
ated, even more than the majority
of anglers realize, caution the
guides. Fly fishermen should use at
least a 3-0 spinner for bass and
work the shaded shorelines when
using artificial baits. Only rarely
will the fishermen get a strike
from shadeless deep water when
using artificials. Early morning or
late evening are the best times to
fish the lake, although over 70 per
cent. of the guides' indicate 'they
prefer the dawn hours.
"We know that the path of least
resistance leads to ruin es surely
as does the path of conquering
force."—Albert Einstein.
FOR YOUR
CONVENIENCE