Without Subsidy Butter Would Cost 2/4 lb.

Chronicle (Levin), 19 August 1949, Page 3

Without Subsidy Butter Would Cost 2/4 lb.

WELLINGTON, August 18. 4 ' If there were 110 subaidy on butter, it would be uecessary to liave a retaii priee of 2s 4-d lb in New Zealand to cover production costs on the basis of the guaranteed price, " said Mr. W. Marshall, chairman of the New Zealand Dairy Produets Marketing Commission, when he addressed the Domin ion Dairy Conference today. The new prico to producer would involve a subsidy of lOd lb if butter was to continiie to be sold at ls 6d. Mr Marshall told the conference tEat in Britain where butter was also' held at a retaii price of ls 6d lb by means of a Governraent subsidy, New Zealand butter would have to be retailed at 2s 6d lb to cover the cost of production shouid the subsidy be removed. It ahould be realised 'that New Zealand had to dispose of its product. Without the Uuited Kingdom Govorninent subsidy, it would require to sell at 2s 6d lb in a highly competitive market. New Zealand 's iucreased costs had beeu taking place at a time when world prices generally were falling and when New Zealand 's competitors were being required to accept reduetious in their prices. There was a danger that with rising costs of production, New Zealand 'n butter rniglit become a luxury article. In a review of overseas production and prices trends, Mr MarshaU said there were umnistakable signs of falling prices. The fact that New Zealand had held its export price beiow. that ot competitors and had a pool fund, gave the Dominion time to take stock of the situation but it was clear that it wa° the duty of all who were in a position of influencq, to take steps to hold ocsts and later to reduce them.