BUTTER PRICES

Dominion, Volume 14, Issue 165, 8 April 1921, Page 6

BUTTER PRICES

IMPORTANT DEVELOPMENT DISPOSAL OF IMPERIAL STOCKS PREPARED TO SELL AT LOSS The British authorities who are holding heavy surplus stocks of butter in England in the face of a falling market are anxious to quit the butter ihatl is being held on their account in New Zealand. They paid the factories 2s. Gd. for this butter under the contract that expired at the end of last month. They hnvo now indicated to tho New Zealand Government that they are willing to sell this butter at a loss and have suggested that a market! may bo found for some of it in Western America. There is more butter in the stores than New Zealand cbuld possibly consume, even if production did not continue during the winter. The price av which the British authorities are willing to sell is understood to be about 2s. per pound. They feel, apparently, that they may suffer (an even larger loss if they take the butter to Errand and add it) to the surplus stocks there.

Meetings of producers that have been held this week have had to consider in the light of this development the earlier decision to charge 2s. 2Jd. per pound for butter at the factory during the winter months. It is clear that the consumers can get better terms through the Imperial Supplies Department while t'jie market outlook abroad, in the event of the Government lifting the embargo on export, is unfavourable.

FINAL ANNOUNCEMENT NEXT WEEK

A final decision about the price of butter during the winter months should be reached before the end of next week. Dr, C. J. Reakea, Director-General of Agriculture, stated vo a Dominion reporter yesterday that, he was taking steps to arrange a suitable date for a further discussion with i'he representatives of the dairy companies. Meanwhile there were other aspects of the matter which had to be gone into, and they would necessitate a conference wi!!h the representatives of the Master Grocers’ Federation. In the meantime, of course, the price of butter over the counter would remain at 2s. 3d. per lb.

Another conference of butter producers was held in Palmerston North on Wednesday afternoon to consider the fixing of the price of butler in view of the changes of position which had taken place si neo they previously met n couple of weeks ago, says our special correspondent. About a hundred factory companies were represented. Tho proceedings were in camera, but it whs afterwards announced that the conference had not decided upon any fixed price. A committee of five was appointed to proceed to Wellington to act in conjunction with committees from othel centres in the Dominion at n conference to be held with tho Government. FRIM THE PRODUCERS’ VIEWPOINT RECENT HAPPENINGS DISCUSSED. Several points in news telegrams and cable messages on the subject of butter were referred to yesterday by Mr. T. C. Brash, secretary of the National Dairy Association: — "Some grocers in different parte of New Zealand,” said Mr. Brash, appear to have an impression that butter producers have attempted to dictate Iho price at whiifli shopkeepers should sell butter. This ,is not tfie case. The fact is that the producers, at the meetings of last week, merely suggested the possibility of a uniform retail price of 2s. 6d. if the wholesale cash price of pats was 2s. 4d. uniformly throughout the Dominion. Thelre was no intention whatever among the producers to fix absolutely the grocers’ prices.” Cabled reports from Australia, he added, had mentioned a reduction of prices, but in connection with these messages it was important to take account of the fact that the consumers of the Commonwealth were not subsidised to the extent of 6d. per lb„ like those of the Dominion. During the period of the Imperial Government's contract the great majority of Australian consumers had to pay a considerably higher price than the New Zealand consumers, whose butter was purchased at 6d. per lb. below the market value. Another important fact was the difference in quality between the Australian and Nfew Zealand butter. Recent reports showed that the difference was assessed by the Imperial authorities at 2d. per lb. in favour of tho. Now Zealand article. In the achievement of this standard of quality New Zealand producers, acting on the good advice of the Agricultural Department, had gone to great expense in the establishment of first-class herds and in the installation of up-to-date machinery.

The main point in. the butter question from the producers’ viewpoint, was a parity value for milk for butter by comparison with the returns obtainable from cheese, dried milk, or milk for ordinary household use. The present value of milk -for cheese was equal to 2s. Gd. per lb. of butter-fat, and for dried milk the return was equal to 2s. 9d. per lb. of butter-fat. Contracts for winter milk had been made by the Wellington City Council at 2s. per gallon, which was equal to 4s. net per lb. of butter-fat at tho factory.

Continuing, Mr. Brash' said:—“The Prime Minister stated at the big conference of producers on March 31 that 'if the producers were compelled to take lower prices then the cost of production must be lowered.’ It is estimated that the increased cost of production of winter butter is 25 per cent. Why, then, should the producers be expected to accept less for butter made after April 1 than for butter made before April 1?‘ At 'the same conference Mr. Massey said truly, as New Zealand people have good reason to know at present, that ’upon the prosperity of the producing industries would depend the prosperity of the Dominion as a whole.’ Other remarks of the Prime Minister were: ‘The year was going to be one of financial difficulty for the producer.’ ‘He would impress upon the producers the necessity of producing—and producing the very best.’ The producers of butter have striven to produce the very best, and they expect, reasonable encouragement to continue in that course. They wish to be fair to the public, but they have to be fair, also, to themselves. They believe that the basis of price fixed at the. meetings of last week represented a fair and square deal far producers and- consumers alike. When, representatives of the producers meet the Prime Minister again within the next few days they hope to satisfy him and to satisfy the public that they have not asked for an unreasonable price for winter butter.” AUCKLAND PRODUCERS DEMAND FOR FREE MARKET. By Telegraph —Prens ABnoci&tlon. Auckland, April 7. A meeting of representatives of butter producers in the Auckland province to further consider the price to be charged for butter on the local market, unanimously resolved strongly to protest against the suggested action of the Government to use Imperial stocks to force down the local price below the cost of production; also, to reiterate tho demand for a free market. A mol ion was also carried recommending producers not vo accept less for their butter than 2s. 2id. P©r pound ex factory. A telegram embodying these resolu-

tions was forwarded to the Government subsequent to the meeting. The telegram stated the position ns it exists from the producers’ point of view, and empbasise'd that butter could not be produced here at London summer values. It also stated (ffiat producers must there fore insist on a price to cover the cost of production, and that any attempt at coercion by the Government! would be strongly resisted. The hope was expressed that, the Government would either remove all restrictions immediately or continue the present subsidy of 3d. a pound. AUSTRALIAN POOL TO CONTINUE Sydney, April 7. The New South Wales Government having declined to institute another butter pool for the coming winter, New South Wales and Queensland representatives of the Commonwealth dairy produce pool liave decided i'o continue the pool from April 1 to September 30 without Government support.—Press Assn. WHOLESALE PRICE IN SYDNEY REDUCED. (Rec. April 8, 0.20 a.m. Sydney, April 7. The wholesale price of butter has been reduced twopence . per pound.—Press Assn.