NEW ZEALAND BUTTER

Dominion, Volume 12, Issue 110, 3 February 1919, Page 8

NEW ZEALAND BUTTER

PURCHASE NEGOTIATIONS MR. MASSEY'S WORK FOR PRODUCERS It is no doubt commonly supposed that the making of the bargains for tin 6ale of Now Zealand butter and cheese to the British Government has been a comparatively easy task for the Government. A budget of the telegrams exchanged 'between the Trime Minister of Now Zeaiand and the High Commissioner shows how very difficult the negotiations, have been, and how much work has been done by the Government nt this end on behalf of tho dairy producers. Tho negotiations begnu on Juno 27. 1917, when there was great congestion of butter in the stores in this country. At that time there was in force .a priority order which did not give butter a place among the kinds of produce to be shipped. Mr. Massey then requested that for Iho next few months before the opening of the new season in the following August something should be done to relieve the congestion. Not after one telegram, but after two, came the reply Hint in those two month." the Board of Trade would arrange to ship CO.OOO boxes. But this amount did not completely solve New Zealand's problem, for there were in store somethtim like 150.000 boxes of butter, and Mr. Mnssey had to ask for more shins, in order that the nccnminalion might be removed io moke room for the new season's output. At the same time the request was made through the Governor-General that the. British Government should take over (he purchase of New Zealand butler, along with New Zealand cheese. Nothing was dono about the purchase suggestion until S'epI tember, when the New Zealand Government began to press again for the completion of a purchase arrangement, in view of the unsettling effect, on the. dairy industry that the existing insecurity was having. Several telegrams passed during that month, and on October 1, having heard from the High Commissioner I hat Australian butter had been purchased at is. Id., f.0.b.. Mr. Mnssey telegraphed ftsking for pxnoditinn. ami asking also oi. behalf of iNew Zealand twitter men not iess than Is. (Id. per lb., f.o.b. At liii'.gili came an offer, on October 3. .1017, to take 13,000 (oils of butter at 1555. !'i;r cwt. Tlri« offer was submitted to the producers' renresenfati,vos. and the producers, asked 1595. for their butter under certain conditions, one of which was tint 90 per cent, of the purchase price should be advanced to tho producers after twenlv eight days in f'tore, and another condition was that in Ihe caw of Intler. sold by the British Government through the ordinary trnd* ehannels. which it was considered would bo sold bv the Government nt n. considerable profit, such profit would be returned to the New Zealand producers. That was on October 18. but en November 2 Mr. Mnssey telegraphed to the Hiirb Commissioner flint, the nrodueers would accent 1575., although they considered that their product was worth more than this price, and nh;o Hint they | should receive more for it in view of j lit" increased cost of production. The price was accepted by the Food Controller on Novemlwr'B. but ihens had Io bo further negotiations as to the conditions of purchase. Mr. Massev at onco began to press for space for butter in the steamer.; then on the berth in New Zealand. The settlement of the conditions proved a long business, and the Government hero had to take risks in advancing money against the butter held in store, to tho lingo wnount of I'GOO,OOO. These advances were, accessary to provide the dairy companies with finance, for at tho time some of them wero on tho verge of closing down because the banks could not nny longer carry them on in view of tho uncertainty as to future sale of the butter. In November the Food Controller undertook that 'half of the profits made on tho sale of New Zealand butter in England should ho returned to the New Zealand producers, and not until May was it announced that the amount to be shared would be from 345. to 3Ss. per cwt.

Tho negotiations for the purchase of butter for the present season were easy by comparison, for they opened in May of last year, and the deal was closed iii November, nt tho price of 181s, for butter and 103 d. for cheese.

As some indication of the intensity of the representations made by tho New Zealand Government, the following telegram, longer and more explanatory than most of the others, may be quoted. It was sent at tho end of 1917, when it appeared that there was a. considerable chnnce of the negotiations falling through, and the Food Controller leaving New Zealand out of account because it was not apparent, that, there would bo a ready supply of shipping space in which the butter could be brought from New Zealand to Britain;— "Butter and cheese: My Ministers are in receipt of telegraphic information from the High. Coi'missioner for New Zealand, dated 13th instant, intimating that the detnils in regard to the purchase of the present season's output of bnltor and cheese have not! yet been settled by the Food Controller, the reason given lieina that the Ministry of TVod is waiting to Bee whether sufficient ships will lip available. This is'the first intimation my Ministers have received that the purchase of the output would bo subject to such a condition, and this aspect ofthe matter was not a condition '.hen the offer of the Food Controller was placed before the producers and accepted by them. As a result of the negotiations which were proceeding between the Imperial Government and the New Zealand Government, the butler and cheese fiom the Dominion was prohibited c\copt to the United Kingdom, and my Minister.; have, on behalf of the Imperial Government, closed contract with the New Zealand producers. Now, in the absence of tho oxpected reply from His Majesty's Government tho producors nic experiencing the; greatest inconvenience in fii.nneing their operations, as they naturally e;.pect'ed that the 90 per cent, advance i.ould be arranged for as was the case last season. Already there is a very largo quantity of butter and cheese in store awaiting shipment, and in view of the fact that sixteen ships arc now on tne loadingberth or to arrive not '.nter than the end of Decembor, tbe action of the Food Controller is not understood. All that is required is a definite decision on the part of the Imperial Government regarding the details of purchase, all of which have been submitted to tho Imperial Government. "My Ministers desire to point out that the negotiations in rcjnrd to the -purchase of butter and cheese were opened a< far back as April last, and the ixtraordinnry delay that lias occurred in obtaining a definite decision from the Food Cctroller has led to a most acute position in the Dominion, particularly jn regard to the internal finance of the butter and cheese industry. Many factories are on the verge of closing down o*inpr to being unable to arrange finance with the banks in the Dominion, and consequently unable to meet their obligation to 'milksuppliers throughout tne country. The gravity of the position can niirdly ho exaggerated, mid has been rcpea'tedly brought under the notice of His Majesty's Government by the High Commissioner for New Zealand, ncting on tho express instructions of the New Zealand Government My Ministers feel that the extraordinary delay which hns occurred 'has placed and is placing tho Government in a most invidious position, and they desire r:e to ask you to represent th.o extreme seriousness of the position to His Majesty's Government, and request that n definite and satisfactory roply lw forwarded within tho next fow days." MINING NEWS WELLINGTON SHARE MARKET. The followinir nuotntions was recorded in the mining market on SaturdayBuyers. S«llorn. ~~. £s - <'• £s. d. YTailii 2 4 3