NEW ZEALAND BETTER

Dominion, Volume 33, Issue 185, 2 May 1940, Page 6

NEW ZEALAND BETTER

Retail Price In The United Kingdom OFFICIAL EXPLANATION The following is the text, of a note which was given to New Zealand and zkustralian Press representatives in London on Maj' 1. “In view of comments -in the New Zealand Press on the position of Now Zealand butter in the United Kingdom market, a. note on certain aspects of this matter was issued to representatives of New Zealand and -kustralian newspapers in London on March 25. Further criticisms, mainly relating to the price of sale, have recently been appearing in New Zealand newspapers, and the following additional explanation may therefore be of assistance to New Zealand and Australian newspaper correspondents. “It is true that, as stated in . the Press, there are ample supplies of butter in the United Kingdom at present. Those supplies have, however, been built up precisely with the object of meeting such a situation as has just been created by the total cessation of supplies of butter from Denmark. This event has justified the Ministry of Food in pursuing a prudent policy which will enable the Ministry to con-

tinue in the new circumstances to supply an adequate ration of butter to the people of the United Kingdom. “A great deal of the Press comment which has appeared in New Zealand has been concerned with the question of the retail price at which butter is sold in the United Kingdom. It is, however, misleading to compare the New Zealand f.o.b. price of 112/6 a cwt. sterling with the issue price in the United Kingdom of 143/- a cwt., without bearing in mind that under peacetime conditions New Zealand and Australian butter would have to bear the cost of Insurance and freight. In addition such butter would have to carry certain selling charges (commission, discount, storage, interest, claims, etp.) amounting to at least 5/- per cwt. “It is, therefore, improbable that even under pre-war conditions, butter which provided a return in New Zealand of 112/6 sterling per cwt. could have been sold in retailers’ shops in the United Kingdom at less than 1/6 a lb., i.e., only Id. a lb. below the present maximum retail price. This difference of Id. would seem to be fully justified by increased costs during wartime. The Costings Department of the Ministry of Food will, however, continue to give close attention to the question of effecting from time to time all possible saving in cost of storage, insurance, and distribution with a view to the reduction of present retail price of butter whenever that course becomes practicable. “It should also be borne in inind that New Zealand and Australia have already received a substantial quanti-

>- tative preference in that, uotwitlie standing their great distance from the Mother Country, the whole of the butt ter which has been produced and I shipped in the present favourable seai son has been bought by the United 3 Kingdom, whereas the quantities ( bought from Continental sources of a supply have, quite apart from the rei cent invasion of Denmark, been coni siderably reduced. In these circum- , stances, even had it been possible to : sell New Zealand butter in the United I Kingdom market at a lower retail • price, it would uot appear that the i quantity exported from New Zealand > to the United Kingdom during the - season would have been increased.”