8284. By Mr. HARRISON: Have you noticed much difference in the quality of the wheat recently received?—It depends largely on where it comes from.

8285. There has not been any marked improvement in the wheat coming forward?—No.

8286. By the CHAIRMAN: Then at last year's rate of 7d. per bushel, with 7s. 6d. for bags, it works out at 35s. 6d. per ton?—About that.

8287. So the 33s. this year is only 2s. 6d. less than last year in respect of your mill?—Yes, about that amount.

8288. But to make up the returns required it will be necessary that you have a better quality wheat than previously?—It will be quite essential.

8289. Then instead of its proving a reduction it may prove to be an increase, because the wheat which will be rejected will cost considerably more to grist?—I do not think Mr. Keys really means that he is going to insist upon an extraction of 42 lbs. If he does it will mean that comparatively no weevly wheat will be gristed. If he insists upon 42 lbs. it will be getting away from the whole object of the taking over of the mills by the wheat Scheme. There is no reason why they should continue the gristing arrangement if 42 lbs. is insisted upon, because that will mean all f.a.q. wheat.

8290. You have read this announcement by Mr. Baxter in today's paper?—I think the best answer I can give is this: when we first made inquiries in regard to wheat for export flour to Singapore, they wrote confirming the conversation which had taken place in the Scheme's office, and advising that f.a.q. wheat would be supplied for the purpose and that the price charged would be 6s. 4½d. We were to get a certain extraction which was set out in detail. That was the Scheme's own statement, 41.3lbs. per bushel. That was from f.a.q. wheat. How, then, is Mr. Keys to get 42 lbs from weevly wheat?

8291. Last year, to the 31st August, you turned out 4,522,183lbs. of flour, 2,261 tons 183lbs. of flour. So the reduction in the price as far as you are concerned will only mean on that output 283lbs. So really if you reject a large quantity of the wheat you previously gristed you will require a considerably higher rate for gristing that reject wheat?—That is so. I am satisfied that if the Scheme enters into that arrangement with the millers they will require to take samples at the mill, otherwise there will be a tremendous quantity of rejects. At mills not having railway sidings it will mean heavy cost to the Scheme for carting this reject wheat into the mill and out again, which in itself will represent 3s. per ton without taking into account the handling by the Scheme of that wheat, as well as the freight on it, plus the loss in value of the wheat which will have to be put on to the market (for weevly wheat brings very little), plus the further commission that they pay to Dalgety for selling it. It will mean either that the wheat they are sending us now will not be sent or if sent it will be rejected.

8292. So there is not likely to be much saving in the gristing?—I do not know what is in the mind of the Scheme.

8293. But what is in your own mind? Take your own prices last year of 35s. 6d. now to be reduced to 33s. Much of the wheat you have gristed in the past will not produce 42lbs., so it necessarily follows that there will be large rejections? —Yes. From the point of view of the actual gristing operations the difference in the price by the Scheme and what we have been getting, if we had to grist similar wheat owing to the tonnage of flour not being in it. it would mean £25 a week to us, but if they give us f.a.q. wheat it will only mean £15 a week to us.

8294. Do you think it will be anything at all?—Unquestionably.

8295. If you have to turn out 42lbs you will find it necessary to reject a lot of the wheat you have previously gristed?—Undoubtedly.

8296. You would not grist the worst quality for 7d. per bushel?—No.

8297. So there will be an increased cost in the gristing of that wheat?—Yes.

8298. On seven months' working the new arrangement will mean a difference of £283 about. and when they put on the increased cost of gristing there will be very little difference?—There will be a difference of about £15 per week to us.

8299. So really the only saving of any importance is the 1¼ per cent. on local sales?▬That I have included.

8300. It represents a total of only £1,250 on the whole of the State's requirements?—It will work out at more than that when you take everything into consideration. For instance, twine is almost unprocurable at present. In our small mill it is costing us for twine £40 per month, or £10 per week. The chances are that twine is going to be even higher. Twine is never taken into account. The Scheme provides the bags but not the twine; we have to pay for he twine. May I say that I have worked the matter out carefully on the basis of our past gristing. The same wheat as we have been gristing during the past nine months would show us a loss of anything from £25 to £30 per week. F.A.Q. wheat would reduce the loss to about £15 per week. If we lose £15 per week on the basis of the existing agreement, The Government must make that in saving.

8301. By Mr BROWN : Did your contract finish up on Saturday?—We milled out at half-past three yesterday.

8302. Was an inventory taken then?—Yes.

8303. You have a clean sheet now, agreeable to the Scheme and to yourselves?—Yes.

8304. Signed by both parties?—I do not know that both parties have signed it. The Scheme representative was at our mill yesterday, and he signed a document showing the position when we milled out. He left a copy of that. We signed the copy he took away.

8305. There will be no dispute from the starting point of any new agreement?—Not so far as we are concerned.

8306. Have you any new agreement fixed up?—Not yet. I have advised the Government that my firm would probably find themselves in the same position as before, that any arrangement made by the Government with the other mills we would agree to.

8307. We have evidence that two mills have already fixed up an agreement. I presume you have the tentative agreement in your possession?—Yes. 8308. So far you have not finalised with the Scheme?—No.

8309. In connection with this present year's gristing, did you reject any wheat at all?—Yes, quite a quantity, but not so much on account of weevil as on account of barley and gravel and musty grain. We seemed generally to get the bottom of the stack, which was half gravel, and that, of course, we did not grist.

8310. Was that stuff sent from Fremantle?—A good deal of it was from Fremantle; some from the Geraldton district; some from parts of the eastern districts and Spencer's Brook.

8311. Train loads, or just occasional trucks?—Not train loads. We were generally limited to about 500 bags per day. Sometimes we got up to 800.

8312. Would you sample the wheat in the truck, or would you reject it after it came into the mill?—After it came into the mill, because not every bag would be rejected.

8313. To whom did you re-consign the rejected wheat?—To Dalgety's.

8314. When wheat was returned from the mill, who paid the cartage?—Up to date we have paid it, but we proposed to charge it to the Scheme.

8315. You have nothing in your agreement as to doing so?—Yes, we have. The agreement state that where wheat has been rejected owing to not being up to a certain quality, all the handling charges are to be paid by the Scheme.

8316. Then you have a legitimate claim for the cartage back?—Yes. On one or two occasions we rejected the whole consignment in the railway yard. One lorry load proved so bad that we rejected the whole consignment. We got a representative of the Scheme out to examine the consignment, and he, too, rejected it.

8317. So the person who consigned that stuff for milling purposes knew nothing or little about the quality of milling wheat required?—Either that, or else he was careless.

8318. It caused the Scheme a fair amount of expense?—Unquestionably. If that wheat, being suitable only for sale as poultry food, had been consigned from either Fremantle or Spencer's Brook to Perth for sale, there would have been only the one freight paid on it, at the mileage rate. Being consigned to East Perth station for our mill, which would be practically the same mile-