60,000 bags; our agents received 50 per cent., say, 30,000 bags; 1917-18—on monopoly they received 100 per cent. (smaller yield), say, 30,000 bags; 1916-17 season—30,000 bags at 1½d. per bushel = £562; 1917-18 season— 30,000 bags at 1d. per bushel = £375; difference in income for same job, £187. I therefore contend that the country siding service is underpaid. Natural increase.—In reference to queries 3846 to 3849 and the replies of Mr. Keys regarding natural increase, I am of opinion that further inquiries will demonstrate to the Commission that Mr. Keys' statement that natural increase is not greater than a half per cent. on oversea deliveries is under-estimated. In pre-Pool days, Messrs. Dalgety & Company sold a considerable quantity of wheat in London on consignment. In their circular letters to farmers referring to this class of business, I believe, they stated that a natural increase of 1¼ to 1½ per cent. was general. I, myself, have sold wheat on London market and gained, I think, 1 per cent. increase, but that was very low. I have a quotation here from "The Book of Wheat," standard work on the subject. It reads as follows:—

Water.—Wheat ordinarily contains from ten to fifteen per cent. of moisture. Changes in the moisture content of the air cause corresponding variation in wheat and, consequently, in its weight. Usually, such fluctuations in weight do not exceed six per cent., but they may be as much as twenty-five per cent., and an increase of nine per cent. in 24 hours has been observed. When wheat is shipped, especially if it is transported long distances, this may be a matter of great commercial importance. Wheat transported from the dry atmosphere of the inland of California to ordinary temperate regions will invariably gain from five to fifteen per cent. in weight. In a voyage from San Francisco to Liverpool, the increase in weight due to the moisture absorbed en route may be sufficient to pay all expenses of transportation. Every portion of the wheat grain is so susceptible to influence from hydroscopic conditions that all of the products of wheat exhibit similar oscillations in weight. Two days equalised the moisture content in samples of flour varying from less than eight to over thirteen per cent.

During 1916-17 season I objected to giving the millers the benefit of natural increase, as it was unfair to the farmer. I think I was the first to object to marked weight being taken. We offered Padbury's (to whom we were delivering at the time) either to weigh the wheat or alternately to accept 4lbs. above marked weights to save him weighing. The latter course was adopted. I understand also that in connection with 1915-16 season's operations, there was an actual surplus of about 75,000 bushels, notwithstanding considerable loss from various causes. The evidence of Mr. Keys on this question is on a par with some evidence recently tendered in the East in regard to the profits of flour millers. In this connection I have an interesting cutting from the Melbourne "Age" which I would like to put in as evidence. I shall be glad if you will let me have the cutting back, as I value same somewhat:—

How Flour Prices are kept up.—Millers at Variance.—Trade rivalry which has divided into hostile camps the Wedderburn Co-operative Flour Mills Proprietary, Ltd., and the Victorian Mills Owners' Association is stated to have developed recently to an acute stage, and the relationship existing between the two organisations is said to have become, as a consequence, the reverse of amicable. The co-operative company started in business in a small way a little more than five years ago, and is reported to have since increased its output of flour by no less than 150 per cent. Its shareholders comprise consumers, being mostly bakers and produce merchants. At the outset the company applied for membership of the Mill Owners' Association, but this was refused. Recently, it is alleged, member of the association have refused to supply any of the shareholders in the co-operative company with mill products, although some of the association millers had verbally expressed their willingness to trade "at a price," quoting for flour a figure above that at which other buyers are supplied. It is alleged to be the desire of millers, with a few exceptions, to form a central selling agency, whereby the distribution of the mill products and the adjustment of prices may be controlled from Melbourne. This scheme, it is asserted, has been thwarted, thus far, by the inability of its promoters to induce the co-operative company and one of the large town millers to fall into line. If the squabble should denegrate into a price-cutting competition consumers may derive benefits from it; but in any event the contest between the two section of the industry is worthy the attention of the authorities in the interests of fair play for all parties. Profits of Flour Millers—Moisture added to Wheat—Press excluded from Deputation.—Some interesting points were brought to light yesterday when a deputation from the Metropolitan Mill Owners' Association waited on the Minister of Agriculture to ventilate a grievance. The complaint of the millers was that owing to the fact that wheat from the 1915-16 harvest had absorbed all the moisture it was capable of absorbing, they were unable to add further moisture, and consequently their profits were affected. The addition of water to wheat was essential to the gristing process. A member of the deputation was about to quote figures regarding added moisture, when he noticed that press representatives were in the room. He objected to their presence. Another miller said he feared that a false impression might be spread abroad if certain statements were published. Mr. W. C. Thomas, vice-president of the association, stated that millers found it impossible to add any more moisture to the wheat from the 1915-16 harvest. So many bushels of wheat generally went to a ton of flour, but owing to the condition of the wheat that was now being gristed, the output of every miller had been reduced. He did not know what figures officials of the commission would put before the Minister to disprove their case. The Minister: On paper your case is not a very good one. Mr. J. Minifie said that amounted to pitting the scientific version against the practical version. With the wheat that was being gristed in 1916 his firm was able to add an average of 2,000 ounces of water per hour, but with the wheat now being gristed from the 1915-16 harvest they could add nothing. At this stage Mr. Minifie said he intended to quote figures which were not for the public. He did not think the press should be present. The matter was on affecting the internal working of firms. The Minister: It is a question between the millers and the owners of the wheat—the "pool." Mr. Minifie: In the ordinary course of events we would be now gristing 1917 wheat, not 1915-16 wheat. Mr. Thomas: The matter is not one of much news value to the press. The "man in the street," however, did not understand the practical working of a mill, and it was easy for a misunderstanding to arise. The Minister: Of course he will say that you are "doctoring" the flour. Mr. Minifie: If I give figures I would be exposing our private business to the public. Mills were losing 2½ per cent. on the wheat from the 1915-16 harvest compared with ordinary wheat. The Minister: Two per cent. is the maximum of moisture that wheat will absorb no matter how long it is stacked. Mr. Minifie: We have figures to show that wheat will gain from 10 to 14 per cent. of moisture. Mr. Down, secretary of the association, at this point again objected to the presence of the press, stating that it was never intended that the meeting between millers and the Minister should be more than a private interview. The Minister of Agriculture then asked the press representatives to withdraw. Subsequently Mr. Oman stated that the burden of the request of the millers was that they should receive a concession from the commission in respect to the added weight of the wheat supplied to them owing to the presence of moisture. If the wheat were not so moist millers would get more wheat to the top. He pointed out to them, however, that the price to millers had been fixed by the Australian Wheat Board. He would consider the representations made.