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Areas of these kauri-chip basins fit for being treated by thess riddling processes are selling at high prices, and many syndicates have been formed for the purpose, of exploiting them. A question of much concern to those engaged in the industry is whether the use of machinery in the production of these smaller gums will result in an overproduction. Having regard, however, to the high prices now being paid for these gum-bearing areas of private lands, and the scarcity of labour on the gumfields, it is doubtful if any great reduction in the price of chips and small gums will result in consequence of these various projects for production on a large scale. Unless; a material reduction in the price of chips takes place it is suggested that there is not likely to be any great increase in demand once the present extraordinary post-war requirements have been filled. One thing, however, seems certain, and that is that if these machines can do anything like what is claimed for them, then the days of the " dirty " chips are numbered and must soon pass. The exporter will be able to pick and choose, and the digger or company who has been in the habit of sending in samples containing 50 per cent, or more of pure dirt, as is the case to-day, will either have to clean his gum better or go out of business. Another probable result of the increased activity in these riddling processes is that a fairly uniform grading will result, and that it will be found practicable to establish a standard grading of gum fot export, a reform which has been for so long advocated. Purchases and Sales. During the year kauri-gum to the value of £23,743 15s. 7d. was purchased by the Department, while the sales amounted to £44,496 4s. 3d. As in past years, most of the gum was sold in America, but a fair proportion of the sales were made to British buyers. The world-wide demand for raw materials generally has been reflected in the kauri-gum market, and during the past year record prices have been obtained for all classes of gum. This has been to a great extent caused by the fact that the pound sterling, instead of being worth the par value of 4866 dollars, fluctuated between 3 and 4 dollars in New York, while the exchange has been all against the European countries in London, enabling the London dealer to meet the American competition on possibly even terms so far as benefits accruing from exchange arc concerned. Pull details of the expenditure under the various headings are given in another part of the report. It will be seen that the amount standing in the Public Account to the credit of the Kauri-gum Industry Account on the 31st March last was £16,322 10s. 6d. Katjri-uum Exports. For the year ending 31st March, 1920, the export was 4,726 tons, of the value of £310,614. During the last five years the average yearly export has been 3,569 tons, of the value of £223,880, while for the previous five years the average annual export was 8,288 tons, of the. value of £461,721. The following table gives particulars of the exports for the last twelve years : —

Particulars of Kauri-gum exported from New Zealand from. 1909 to 31st March, 1920, inclusive.

Country to which exported. 10(19. 191(1. 911. 1912. 918. H4. United States of America United Kingdom Germany Canada Australia Belgium France Austria-Hungary Russia Netherlands Sweden Italy Japan Hong Kong Argentina Tons. 5,127 2,290 639 24 149 17 1 I £ 375,126 140,235 24,111 2,555 S.570 1,770 85 08 Tons. £ 4,149 203,375 3,253 151,319 913 28,010 00 7,687 66 4,465 2ffl 1,899 19 1,050 124 3,011 15 1.970 0 133 30 720 23 779 Tons. 3,514 2,378 1 .1 42 9 75 78 75 131 80 55 35 15 £ | Tons. 209,21 (i 3,894 130,707 2,468 34,002 1,053 I,001 40 2,559 39 3,990 123 5,774 37 3,908 1.59 1,859 2 1,206 42 803 35 417 15 25 1 £ 232,566 114,040 32,901 3,370 2,487 5,088 3,037 4, (ill 184 974 952 410 22 Tons. 3,995 3.390 S33 62 80 120 45 1 12 53 tit) 15 9 £ 308,450 187,547 27,880 4,018 3,933 5,120 3,995 2,017 1,725 2,495 420 300 I Tons. 4,531 3,335 373 70 19 31 42 14 3 8 20 23 1 £ 310,200 148,370 > 21,193 2,11-1 1,720 1,519 3,599 329 225 004 560 . 855 90 2 172 8,250 552,098 8 8,693| 465,044 395,707 7,908 40I,305J Totals 7,587 8,780 549,106 8,473 497,444 Country to which exported. 1 115. 1st .In: 31st Ma inuary to irch, 1916. 1st Apri 31st Ms il, 1916, to 1st Anil irch, 1917. Slsl M.i 11, 1917, to irch, 1018. 1st April, 1.01.8, to 81st March, 1019. 1st Apr] Slst Mn il, 1019, to ni.li, 1920. United States of America United Kingdom Germany Canada Australia Belgium France Austria-Hungary Russia Netherlands Sweden Italy Japan Hong Kong Argentina To 3, i 1, Tons. 3,312 ons. ,312 ,172 56 9 5 21 £ 222,850 Tons. 974 £ 60,010 Tons. I £ 3,158 218,214 Tons. 2,310 ' £ 164,516 Tons. I £ 1,371 81,914 Tons. 2,037 £ 157,251 1,172 48,585 330 13,548 1,484! 08,378 303 13,982 346 19,977 I ,650 90,422 50 9 4,560 594 118 5 8,972 314 133 7,718 29 1,982 1,929 18 124,271 1,577 572 45,588 19 4,820 1,016 23 61,005 1,936 5 13(1 21 2,118 501 3,440 . . 8 539 10 500 •• Total? *. 4,575 ,575 279,133 I ,433! 82,844 4,802 300,271 2,33s 152,299 4,636 304,8521 4,720 310,014