SETBACK TO HOPES

Evening Post, Volume CXXII, Issue 31, 5 August 1936, Page 12

SETBACK TO HOPES

AUCKLAND REACTION

"A MISERABLE PRICE"

(By Telegraph.)

(Special to the "Evening Post.")

AUCKLAND, This- Day,

The immediate reaction of the dairy industry to the guaranteed price level has not been favourable. Prior to the official announcement estimates of the basic price ranged from Is Id to Is 6d per lb ,of butterfat, and consequently the basis of abouC Is Id is a. setback to hopes.

"The Government's i-eluctance to announce the guaranteed price is not surprising, said Mr. A. J. Sinclair, secretary-manager of the Te Awamutu Co-operative Dairy Company, Limited. "The Government's guaranteed price of 117s 3d f.o.b. can 'be paid to the industry without any subsidy if the season's output realises an average of 107s in London, or 7s a cwt.in excess of last season's average. With conditions steadily improving in London this is a very safe gamble. The price paid will enable highly efficient factories to pay the suppliers approximately Is Id per lb of butterfat for the season. From this figure the farmer must deduct the increased cost of operating his farm and running his home under the new regime. Where he' employs no labour he may do fairly well, but on the basis of £2 12s 6d'a week plus board for farm labour, he will require to earmark Id per lb on butterfat to meet the increased costs under this heading- alone. In addition he must face other increased costs on the farm and in the home, and on a very conservative basis this will absorb another Id per lb on butterfat. "INSULT XO < DAIRY FARMER." "If any dairy farmer wants to know just where he will stand during the, next twelve months ,under the guar-anteed-price scheme he can form an idea by assuming that he received lid per lb for butterfat for last season's supply, or approximately . lid per lb less than he actually realised in that market," said Mr. Sinclair. "I am sorry to say it, but it seems incredible that the Government should insult the dairy farmer by compulsorily taking possession of his produce, initiating legislation which will involve him in heavily, increased costs, and paying him such a miserable price if or it, taking into account the increased costs the farmer would have to meet." His first impression of Mr. Nash's statement, said Mr. C. J. Parlane, general manager, of the New Zealand Cooperative Dairy Co., Ltd., was that the payment per pound of butterfat which would be available to him would be of little use, and he was doubtful whether the pi-ices announced would be sufficient to cover increased costs and allow for any improvement in the farmer's position as promised by the Government before the election. "A HEAVY BLOW." "There will be a general feeling of disappointment with the basic price fixed," said Mr. J. E. Leeson, chairman of directors of the Morrinsville Co-op-erative Dairy Co., Ltd. "This will not allow, anything extra for higher farm- wages or for increased, living costs. It is a heavy blow to him, and 1 he will probably be worse off." 1