§ LORD STRACHIE had the following Question on the Paper—
§ To ask His Majesty's Government whether it is their intention to allow the free exportation of sulphate of ammonia unless there is immediately a much greater demand for sulphate in this country than there is at present.
§ The noble Lord said: My Lords, those of you who are members or chairmen of Agricultural War Committees will be aware, in reference to this question of sulphate of ammonia, that it was only due to recommendations made to the President of the Board of Agriculture that the Government decided to issue a Prohibition Order as regards the exportation of that artificial manure. As agriculturists we are greatly indebted to the noble Earl for the action he has taken in this matter, and I put this Question because we have reason to fear that this prohibition is going to he withdrawn by the Government. Farmers are at the moment very much dissatisfied. The present position of things is this, that though there is this prohibition of the exportation of sulphate of ammonia which under ordinary conditions would undoubtedly cause a reduction in the price, the price has risen and seems inclined to advance still further. At the present moment sulphate of ammonia fetches from to £16 a ton, and can only be procured at £15 a ton in special cases. The former 595 price was from £11 to £12 per ton; and the cost of production, as I am informed, may be fairly put at something like £8 a ton. At the beginning of this month the Board of Agriculture wrote to the Royal Agricultural Society saying that the demands of the farmers were not sufficient up to the present to avoid serious accumulation of stocks, and that unless there was an immediate demand it was feared further prohibition of the export of this commodity would be impossible. What were the grounds upon which the Board of Agriculture made that statement? I understand they were that the Ministry of Munitions had pointed out to the Board of Agriculture that in their opinion the accumulations of sulphate of ammonia were serious at works—not controlled, I understand, by Mr. Lloyd George—which provided a certain amount of material for the manufacture of explosives. We are in this position, that we are threatened by Mr. Lloyd George that the sanction for prohibition will be withdrawn unless farmers immediately buy at this extortionate price of £16 a ton.
§ Not only is there this extortionate price, but there is every reason to believe that a "corner" has been made in sulphate of ammonia. I should like to point out to your Lordships that under the unfortunate climatic conditions from which we are suffering it is impossible to sow an enormous amount of corn, and the farmers, therefore, are doubtful whether they will want much sulphate of ammonia. That entirely depends on what may take place during the next six weeks or so. There is also the difficulty of labour, which is growing greater and greater owing to the calls that are being made upon the agricultural population. There, again, we have to thank the noble Earl (Lord Selborne) for the way in which he has fought the battles of the farmers, for speaking so freely on our behalf, and representing our views so truly. How can it be said that these accumulations of sulphate of ammonia are in any way hindering the manufacture of material for munitions? The Council of the Royal Agricultural Society only yesterday wrote to the Board of Agriculture asking that Department to represent on their behalf to the Minister of Munitions that prohibition should remain in force at least up to May, so as to give farmers time in this matter.
596§ As regards the price being too high, I may, of course, be told that this is only a question of supply and demand. Undoubtedly in old days that was a very good and proper doctrine. But when it is being urged by a certain section of the Mouse of Commons who have not much interest in agricultural matters that if farmers put up the price of, say, meal, cheese, meat, or any other produce the Government must step in and regulate the price, surely in the case of those artificial manures which are so essential to farmers and agriculturists if they are to produce that amount of food which the Government are always urging as absolutely necessary, the manufacturers ought to be told that they will have to regulate their prices. I think I am making a perfectly reasonable appeal to the Government when I ask that they should maintain this prohibition at least a little while longer, and not, as it were, hold a pistol to the heads of the farmers and say, "If you do not buy this sulphate of ammonia even at its extravagant price it will be allowed to go out of the country and you will not have any at all, even at £16 a ton."
§ THE PRESIDENT OF THE BOARD OF AGRICULTURE AND FISHERIES (THE EARL OF SELBORNE)Lords, in answer to the noble Lord I have to say that the general prohibition of the issue of licences for the export of sulphate of ammonia has been in operation for two and a-half months, and farmers have had ample opportunities for purchasing their supplies. Considerable supplies have been secured for agricultural purposes, but as there is not sufficient agricultural demand there has been an unfortunate congestion of supplies with the risk of closing down works in some of the chief producing centres. It has been decided, therefore, to resume the issue of licences after the end of this month. Care, however, will be taken to see that sufficient supplies are retained in this country to meet all home needs.
The noble Lord asks what the meaning of this fear of congestion is. I will explain. The fear of the Ministry of Munitions is based not on the theory but on the fact that some of the places where the sulphate of ammonia is produced are absolutely congested, and it would not be possible for them to go on with the manufacture of other articles which are essential for the purposes of munitions, of which sulphate of 597 ammonia is a by-product, unless they are able to dispose of the sulphate of ammonia. Therefore I have reluctantly come to the conclusion that the case is now made out upon the side of munitions rather than upon that of agriculture, and that I am justified—indeed compelled—by national requirements to agree to the renewal of licences for export. In so far as we have influence and power we are taking care, both for the purpose of munitions and of agriculture, that enough sulphate of ammonia is kept int his country.
What has been the effect of the prohibition on prices? I am not prepared to endorse all that the noble Lord said. He used rather strong language. He talked of £16 a ton as an "extortionate price" for sulphate of ammonia at the present moment. It may be so, but I have not the knowledge which enables me to say that it is so. What I do know is that last autumn I was able to make an agreement with the manufacturers that they would sell sulphate of ammonia to farmers at that time at £14 10s. a ton, but I am told that the cost of production has risen immensely since the end of last year, among other reasons because the cost of sulphuric acid has gone up so greatly. I am quite certain that this is true, and that whatever the cost of production may have been at the end of last year it is now considerably higher. When the noble Lord says that it only costs £8 to produce a ton of sulphate of ammonia, I do not know on what information he is relying. I am not in a position to contradict that or to accept it as a fair statement of the case. What I do know is that sulphate of ammonia is produced by many different processes, and whereas there may be one process which can produce it comparatively cheaply there are others in Which it is much more expensive. The noble Lord knows that it is a by-product of gasworks, of the shale works in Scotland, and of several other industries as well as the special product of certain processes.
I have no power to fix the price of sulphate of ammonia, and if I asked Parliament to fix the price, as the farmers have suggested I should do, the first thing that would be said would be, If we fix the price of sulphate of ammonia we must fix the price of wheat, oats, hay, and the other commodities of farmers' produce; and that would not be to their advantage or fair to them. At the time that the export of sulphate of ammonia was prohibited I believe the producers could get £17 a ton 598 for every exported ton. The price to the agriculturist in England during the last two and a-half months has been considerably less than that, and I think it may be claimed that our action prevented a further riseoand quite possibly was responsible for a temporary reduction, in price. I would certainly express the hope in their own interests as well as in the interests of the industry for which I am responsible, that the producers of sulphate of ammonia will be content with the excellent profits which they surely are making now, and will not countenance the efforts on the part of any of the members of their body to force prices in this country up higher.
I should like to say this also. Farmers in this country have not been accustomed to use sulphate of ammonia to anything like the extent to which farmers in other countries and on the Continent have been. They have always preferred to use nitrate of soda. I do not say that one fertiliser can be used in exactly the same way as the other. Experience will show that certain differences are required in the method of application, but it may be generally stated that the results of the proper use of the two fertilisers ought to be very much the same. I am told on authority which cannot be disputed that the value of sulphate of ammonia at £16 a ton is equal to the value of nitrate of soda at £13. I do not think that farmers would hesitate in the least in buying nitrate of soda if they could get it at something like £13 at the present time, but they hesitate to buy sulphate of ammonia at £16, although the value to them would be exactly the same. At the present moment nitrate of soda, which, of course, is almost unobtainable, has come up almost to the price of sulphate of ammonia. Therefore there is no question whatever that the farmer is getting much better value for his money if he buys a ton of sulphate of ammonia than if lie buys a ton of nitrate of soda. The noble Lord will now understand why it is that we have agreed that licences for export shall be issued again after the end of this month. I have told him that we shall take care to keep enough sulphate of ammonia in the country for the needs of agriculture and of munitions, and I promise him that we shall watch closely both supplies and prices, and I hope, that producers will not attempt to push prices up any higher.
§ House adjourned during pleasure.
§ House resumed.