Winnipeg Free Press

Winnipeg Free Press (Newspaper) - July 9, 1973, Winnipeg, Manitoba Winnipeg Ivess monday july 9, 1973 business finance business jittery despite stable Canadian by Bud As u value of news. Canadian press Slaff writer the Canadian Dollar has been a Model of stability while Oiler currencies Drift from crisis to crisis but the Situa Tion still is making Many Ca Nadian businessmen jittery and c o n s n m e r s have reason to worry. On the surface things look Good for Canada and manufacturers Here Are looking at a situation where potential competitive advantage in some markets is improving every the value of floating Ca Nadian Dollar has been within a fraction of a cent of the United states Dollar for months. Meanwhile to value of the american Dollar has been sink ing and during the last few Days it has closed at a record Low each Day. The value of the . O Lar declines against the Ger Man Mark the japanese yen the French franc and other currencies two things happen . Goods become cheaper abroad and imports become More expensive in the . With the Canadian Dollar appearing to go along for the ride businessmen Here in theory i ave this situation the . Market is stable Export ers Are in a better competitive position when Selling outside North America and importers arc being squeezed by higher prices. The stable . Market is u p s e i however because a Price freeze is in effect and exports of certain some feed been rigidly controlled. Keith Dixon general manager of the Canadian importers association said Consumers will notice the results in food prices. He said the freeze on prices has increased demand for foodstuffs in the major supplier of the Canadian Export markets arc being squeezed. The Oiler Side of the declining Dollar value is a Rise in the values of european and Japa Nese currencies and this Means higher prices for imports to Canada. Or. Dixon said prices of Ger Man goods landed in Canada have gone up 25 per cent since Jan. I and japanese items by 18 per cent. Or. Dixon contends that the . Dollar is undervalued and with it uie Canadian Dollar which has been floating since mid-1970. Money Market sources say the Bank of Cen trial Hank which implements Federal fiscal policy decisions Lias not been intervening in Money markets in recent months to control the value of the Dollar. They describe the new locomotive design Dollar value As stable and Bank of Canada activity in Money markets As about 70 per cent of Canad . Japan and the european countries account Tor most of an foreign Trade is with lie porters. The remainder and it is Here that there is the Exchange rate advantage for Canadian sex the Export controls adopted by the ., which also cover scrap steel represent a con Cern about protecting Domestic markets. Protectionism is a worrisome thought for businessmen in countries like Canada which rely heavily on foreign Trade. Everybody s jumpy As hell All around the said Carl Beigie executive director of the c. D. Howe Institute in Montreal which does economic studies financed by private contributions. The French finance minister Valery Giscard d Estwing told a parliamentary committee last week that Trade talks scheduled for september among Industrial countries would not to productive As Long As Exchange rates Are unrealistic. Or. Beigie said he believes there Are solid economic Rea sons for the Canadian Dollar declining in value against Jap. Anese and european Curren cies. The Canadian Dollar has not simply followed the us Dollar it has declined partly because the . Dollar Lias two economics Are closely partly because of changes in Long term capital flows. The Canadian Dollar Rose in value in 1970 and 1971 when there was n considerable in flow of . Dollars partly be cause of higher interest rates in Canada there now Are no longer heavy flows of . Dol Lars into Canada and interest rates Are sharply higher in the . F locomotive the first of 50 for Canadian National railways by Gen eral motors of Canada Ltd. Was unveiled in Edmonton Friday. . Executive warns feed manufacturers Aji american feed com Pany executive last week warned Canadian feed manufacturers that unless they shape up and Institute some hard headed Long Range business planning in their operations a number of them could be squeezed out of business by a Short age of available capital and shrinking profits. William g. Phillips chairman of International Multi foods inc. Of min Neapolis told the Canadian feed manufacturers association that in the ., operators have let the iced Industry deteriorate until a number of the largest apparently most viable companies have gone out of the feed business. The same thing is going to happen in the Canadian feed Industry unless com panics shape he warned. Unplanned expansion is the big Bugaboo of this Industry. It results in Cut Throat Competition. When this happens mar Ginal operators Are forced out of business. Often it becomes a test of capital in its quest feed manufacturers com Pete with All industries and the Money markets Brazil govt. Worried by soybean euphoria Bruce handler Bio de Janeiro a _ Brazil the land of Coffee is growing soybeans at the rate of millions of tons a year some Farmers Are predicting that soybean production one Day will outdo Coffee. Despite the world soybean shortage from which brazilians might Benefit in the Short haul the military government Sec the soybean euphoria As illusory and it has taken measures to Slop soy bean planting from running wild at the expense of Coffee and other crops. Dominion i ill Mim soybean was. Then Farmers t h e Southern state of r Grande do sul discovered the could alternate soybeans i their traditional wheat Cro and get two harvests a year i Stead of one. Brazilian soybean product ii increased to an estimated 4 million tons this year fro g50.000 tons in United states production 1972 was about 34 million tons Canada is both an Importe exporter of oilseed. And t. . Appointment of Tommas if Montreali Kex Milivoi vice president dmm nmn to Tili limited is Ann Nim id n a mine. 1 Risinit of or lion was Irinio Vav Pri silent and Ike previously hold senior Manafi Erial positions in ing division where ii Roso to vice president marketing 1372, Canada imported m million bushels of soy hear and tons of soy Ca cake and meal. All told Cam a is about 40 per cent Sci sufficient in soybean meal. The government forecast of Jie 1980 Harvest is 8v5 Misilio tons. But some commod Itic people Here think this could g As High As 15 million tons. Brazil last year exp Orle Riboul a fourth of ils soy Cai crop to Italy Spain West Ger Nany Hungary and the nth Elands. Soybean Export earn nos Are expected to jump to nor than million this j year from 1972 s million. Earlier this year members 0 a Trade Mission from Japan t huge importer of soybeans told the brazilian government their country could buy up to million tons of soybean from Brazil in 1974. Even if world prices drop slightly from 1973 Levels that Deal alone should bring in More than billion in foreign Exchange earnings. H is doubtful that Brazil will actively iry to take away markets Arnm the United slates and Canada which have restricted their exports. Because of the reversal of seasons. Brazil s soybeans Are harvested at a different time of the year than in Forth America. Until now Brazil and the soybean suppliers oth parts of the world on the id that a complementary Nett would help prices generally up. The . Embargo on so bean exports came As a Sha blow to Japan which Richem on imports for meat beget Bles and other agriculture products. The United Slat met 92 per cent of Japan s so bean needs last year. The United slates embargo soybean exports to head off shortage of feed for Catli logs and poultry. When word of the Cuba up Brazil the Price i and in soybean growing area shot up. In the town of r Beirao big lamp Onci used tenant rents on soy Ca arms from the equivalent c 32 an acre to the brazilian government i cautioning Farmers Here tha he soybean crisis is Tempo Ary and that the United slate an to exp Clad to return i is usual voluminous level o sports. Government economic sex crts want to avoid a real out real of soybean fever and an Repard to Stop Farmers fron lowing under other vital crops Ich As Coffee and Corn simply o get in on the soybean Bonan a. The National monetary coun 1 handed Down an order in february requiring soybean a polls to be licensed. The cans the government Coul easily limit soybean exports n Felt enough Beans weren t cog supplied to the Domestic Umal feed Market or that crops were being tier local scale Ned. Nestor Josl prudent of the Deral government s common in Bank Banco do , the ajor source of farm credit in is country hinted last week it the Bank will hold Hack i Nimg for new soybean Fields Farmers neglect other crops big closed mall for Hamilton Hamilton up a Sec million closed mall tic largest shopping Centre in Canada to Date will be build in the Hamilton Mountain area by Western realty projects Ltd. Of Vancouver it was announced Here. Elliot n. Yarmon vice president of Western realty said in a news release the Centre could have 3.5 million Square feet of Ren table space including four major department stores making it Square feet larger than Toronto s Yorkdale shopping Centre. The first step of the development will be completed in 1975 and will include three department stores a Range o retail stores a supermarket movie theatres a Library and other Community services. The fourth department store further retail stores and hotel facilities will be added in the second step As Well As an office build ing skating rink and swim Ming Pool. The go acre site is owned 75 per cent by the Central mortgage and housing corp. And 25 per cent by Ontario housing corp., which last year invited development propos als from 15 of the largest shopping Centre developers in North America. Development has been delayed until the Long awaited of Hamilton s business Core was firmly established last year with the opening of Lloyd Jackson Square and the St Leo Tower. Canadian Export Gas and Oil year ended april Fol eight cents a share 72, seven cents. Canadian Marconi co., year need March 31 an cents a share 72, 33 cents. American Nictaly Climax inc. 37r cents . Funds sept. 1 record aug. 10 pfd., series a dec. 1, record nov. 12 Coronation credit corp., six or cent. Pad. A 3% cents july 1, record july 16. Bug Ltd., class a nine cents aug. 1, record july 25. . International corp., 18% cents sept. 1, record aug. 10. Scott Misc nor steamship Ltd., Svi per cent first pad cents Jidy 16, record july 1j. Jan Nock corp. Ltd., class a 30 cents oct 1 record sept. 17. Anglo permanent corporate holdings Ltd., year ended dec 31 1972, share 1971, 50 cents . Banks bump rates new York a _ the Kiu e slates second Anc Ignon largest Banks raised their Primo lending rates Fri Day to 814 per cent from eight effective monday. _ the new rate is the highest m More than three years new York s first National City Bank and the Continental 1111 s o i s National Bank announced the increase a Day after a new Jersey holding company mid Antic Banks inc., had raised the prime to 854 per cent for its group of medium size Banks. The Primo is the minimum lending fee Banks charge their largest and most credit worthy corporate customers. It has no direct and immediate effect on the Banks Loans to smaller businesses and con Sumers it can signal future in creases in interest rates Gener ally. The moves to follow by Only three Days a Viper cent increase in the prime to eight per cent by Banks across the country. Monday s round of in creases came on the heels of anti inflationary action by the Federal Reserve Board to tighten up on the growth in availability of Money. Make to licit lowest Rales available to the professionally managed Busi unless return on invest ment shows a fair relation to that of other businesses capital will flee or. Phil lips As it already has from a number of giant . Companies once in the feed business. He said return on invest ment in the feed Industry is much lower than it should be. Return on investment in jus own company was abominably Low when to joined it in 1968, with a miserable 5.7 per cent profit that year or. Phil lips said. Multi foods at that time was the largest flour Miller in North America but unfortunately we were not making very much Money at the answer he said was to close unprofitable plants Multi foods closed five . Mills and two in Canada and whittle out the least profitable parts of the business. Another change the com Pany brought in was care Ful Long Range the result said or. Phil has was that the peaks and valleys of the com Pany s profit curve levelled out and earnings More than doubled in five years. A turn on equity climbed to 10 per cent in 1973, and although Multi foods is now Only fifth in size in flour milling it is one of the most profitable milling companies in North Ameri Ca. To must All be belter or. Phillips told the feed men. To need to develop an Over All sound business manage ment philosophy recognizing the full Cost of capital when making economic de unless this happens a predicted some feed operators will simply liquidate their assets and re employ them in a More profitable Industry. This could leave Canada with a shortage of feed plants. Hudson Vlaj mining and Sci Una co limited dividend no. 133 a quarterly dividend of forty cents 50.40 Canadian per Sharp has been declared Ott the capital Stock of this company payable july to share holders of record at the close of business on july John i Carpenter no Fridau sea Start Toronto Ontario june Kau Issue the Manitoba Hydro electric Board Bonds due August guaranteed unconditionally principal and interest by the government of Manitoba Price 100 and accrued interest to yield 8.373% a copy Ottke circular it available on request. Wood Gundy limited a. E. Ames co. Limited bums Bros and Denton limited Merrill Lynch Royal securities limited Nesbitt Thomson scan Ritieni limited Pitfield Mackay Ross company limited Cochran Murray limited Levesque be nubian inc. Richardson securities of Canada Dominion securities corporation limited Bell Gouinlock company limited Mcleod Tong Weir company limited greenshields incorporated Gairdner so company limited Dreman co. Ltd. Peter d. Curry 4 co. Lid. Midland Osier securities limited equitable seen Ritieni limited Fry Mills Spence limited Harris partner limited Bankers securities of Canada limited Burgess Graham seen Ritieni limited Walwyn Stodgell co. Limited Canadian of Commerce the bunk of Nova Scotia the Toronto Dominion Bank july i97j ;