§ 5. Sir C. Osborneasked the President of the Board of Trade if he is aware that Imperial Chemical Industries is selling sulphate of ammonia to British compounders at £18 2s. 6d. per ton, and 210 charging farmers £20 a ton, but selling it abroad in big quantities at £12 a ton, and, in view of the fact that it is offered from abroad at £12 per ton, if he will rescind the import tariff of £4 a ton which has existed for over twenty years and the anti-dumping duty of £3 a ton introduced on 3rd March, 1962; and if he will make a statement.
§ Sir K. JosephMy right hon. Friend is aware that producers of sulphate of ammonia in several countries make export sales below the price on their home markets. Such sales help to maintain production at an economically high level and make a contribution to overhead costs. It does not necessarily follow that producers could afford to make their domestic sales at the same price.
§ Sir C. OsborneThat Answer will not do. The farmers get a subsidy of £8¾ a ton on their fertilisers, but I.C.I. charges them £8 a ton more for what they buy, so that £8 of the £8¾ go to I.C.I. and not to the farmers. The farmers ask why they should be blamed for the subsidy when it is I.C.I. which is being feather-bedded. Why will not my hon. Friend take off these duties?
§ Sir K. JosephMy hon. Friend must realise that the economic way to manufacture many materials is to run the plant at full capacity and, if home demand does not absorb the supply, to sell the surplus abroad. Cheaper sales abroad contribute to fixed costs and overheads and thus make a lower price possible at home. The price charged by I.C.I. at home is, according to the Report of the Monopolies Commission, not unduly high, and, since that Report, the price has been twice reduced. The farmer is, therefore, getting his supplies at only the economic price and is helped to buy them by the subsidy. I cannot agree to do what my hon. Friend asks.
§ Sir C. OsborneIf I.C.I. is efficient, why does it want this double protection of £4 a ton and £3 a ton to protect it from international competition? If we as a party believe in competition, why should not it apply to I.C.I.?
§ Sir K. JosephMost of our competitors also protect this supply. We have the evidence of the Monopolies Commission on the price charged by I.C.I., and, 211 since its Report, the price has been twice reduced.
§ Mr. DarlingCan the hon. Gentleman give us a guarantee that the costs of production in I.C.I.'s figures bear some relation to the home price? Can he categorically state that LCI. is not exploiting the subsidy, as the hon. Member for Louth (Sir C. Osborne) suggested, in order to get money out of the Government?
§ Sir K. JosephIt would normally be difficult to give such a categorical assurance, but, in this case, in view of what is said in the Monopolies Commission's Report published in 1960 and two price reductions since then, I can give that categorical assurance.
§ Sir J. Vaughan-MorganSince we rightly have anti-dumping legislation, is it not a matter for Government policy to ensure that we do the same thing ourselves and discourage dumping by our own firms?
§ Sir K. JosephMy right hon. Friend surely is failing to take into account the fact that it is a benefit to consumers if goods are delivered cheaply to them if there are no home producers to defend. Many of the countries to which I.C.I. is exporting at a price below its home price do not have a sulphate of ammonia industry of their own.
§ Mr. JayCan the hon. Gentleman say whether there is anything which LCI. could do of which the Government might disapprove?
§ Sir C. OsborneOn a point of order. In view of the unsatisfactory nature of my hon. Friend's replies, I beg to give notice that I will raise the matter on the Adjournment.