The Price of Butter.

Press, Volume LVII, Issue 17109, 2 April 1921, Page 8

The Price of Butter.

15y the prominenco they gave to the phra'so "London parity" in their demand for what really was the true market nrice for butter, the representatives of the dairying industry have clearly made a difficulty for themselves. People are asking ithy, if "parity" was the fair price of butter prior to yesterday, "Loudon parity" is not as fair a price now. It is a perfectly reasonable question to ask, but it is only fair that the dairying industry should not be pinned down to. a ■ phrase carelessly selected. If they had asked for the prico they could obtain in the open market, they could make j the same demand now,-and it was the i price they actually could obtain, and wore obtaining for the* exported butter, that they meant when they talked of "London parity." They are now beipg charged with fixing a price above "London parity," although it is obvious, as was pointed out in a new* article we printed yesterday, that yvhat "London parity" is, or is likely to be,

nobody can easily say. There is so much room for quibbling and fruitless quarrelling on this iJoint that the honest citizen whose convictions on right and wrong are not dependent upon his butter-bill, will turn to the consideration of the question whether 2s 6d a pound is, on the whole, a reasonable price. . It is an annoyingly high price? of course. Bnt what can be said in roply to the contention that dried milk factories are buying milk on a basis equivalent.to,2s 9Jd for butter-fat, and that the London price tor cheese is equal to 2s (kl? The reply has been in most cases a threat to invoke the Board of Trade's disciplinary powers. But can the Board of Trade, by setting in operation the machinery of punishment for what may bo regarded as excessive prices, compel the factories to produce all the butter that is required? If we could be sure that an ample supply of 'butter would be produced if prices were restricted to 2s 3d or 2s, or whatever may be the figure at which the public will not rebel, we should bo ready to 'sympathise with the agitation now proceeding against the higher pices. For in that case we should feel pretty sure that there wa9 no sound basis for the claim of the dairying industry that the price now asked is necessary if the winter production of butter is to he maintained. The whole- question is much more difficult than many people appear to imagine. There is, however; one point upon which everyone will agree, whether ho is a supporter of State regulation in general, or a supporter of free industry, and that is, that interference is necessary •to prevent any combination designed to 'exploit' the local market and charge higher prices to ths hpme consumer than to the consumer abroad: The only sound policy in the long run is , non-interference with prices and the maintenance of an effective anti-Trust law on the simple American model. In the case of butter this will mean high .local prices when foreign prices are high, and low local prices when- foreign prices a*re low. The sooner the Government 'settles down to a recognition of the fact that any other policy than free trade and the suppression of agreements in restraint of trade make up the only sound method of dealing- with industry, the better' it will be. The present difficulty cannot be solved by the further application of the unsound policy of temporary expedients that have caused the trouble.