The Dairy Industry.

Feilding Star, Volume XVI, Issue 145, 15 December 1894, Page 2

The Dairy Industry.

PROPOSED CHEESE FACTORY AT APITI. A letter was received a few days ago by Mr A. Cartwright, who is at present acting as secretary for the promoters of a proposed cheese factory at Apiti, from Mr P. F. Ralfe, chairman of directors of the Cardiff Cheese Factory Company (near Stratford), in reply to a communication enquiring for information as to the working of the Company. As the dairy industry is of some interest to small farmers in this district we publish the following extracts from the letter : — " Being the first really co-operative Factory in New Zealand we had considerable difficulty to raise the capital, and as the settlers were at that time mostly in poor circumstances owing to the truck system and the very low price given for all farm produce, it was necessary to work as cheaply as possible. It would be useless to enter into the history of the various ways in which we tried to get the necessary capital but ultimately one of the Banks (the National or New Zealand) gare us an advance of J-600-- the estimated cost of the factory and plant - we giving as security for such advance a mortgage of the uncalled capital— looo shares at ill each— and also as collateral security a bond for .£6OO, signed by 15 of the shareholders, each making himself liable for .£4O and no more, 600 shares were allotted and started work Since then we have twice enlarged the factory, its capacity now is 4000 gallons, aud the total cost has been all of which has been advanced by the Bank without further security, except that shares to that amount have been allotted. Tbo shareholders have not at any time been called upon to subscribe any capital in the ordinary acceptation of the term, but we pay off our liability to the Bank, by deducting Is per 60 gallons from each supplier's mouthly payment. This is credited to the supplier on account of his shares, and the money paid into the bank. Iv this manner we have since the factory started three years ago, paid off roughly .£7OO, aud the settlers have not felt it. This is preferable to a mortgage, as under the latter you would have to pay 7 or 8 per cent, but by dealing with a bank, and keeping a capital and a working account, we reduce the interest by nearly half. The working or current account is generally in credit towards tho end of the season to a largo amount, and as we have arranged that one account shall balance the other our interest is very much less than it would be under a mortgage. There is no mortgage over the buildings and plant or laud, so that should the Bank at any time call in its advances we are more in a position to make other arrangements. As to working. At the commencement of each season we arrange to ship our output to some tirna iv London or Glasgow—this season we are sendiug to both places at a certain guaranteed minimum price f.o.b. ocean steamer. Up to the end of the present season we get 4d per 1b without recourse, we also get whatever the cheese brings over that amount at Home, less commission and charges. The advance of 4d per lb is paid as soon as the bills of lading are lodged with the consignee's agent. We pay suppliers 3d per gallon monthly, the balance is divided pro ntta at the end of the season. This balance is the meantime reducing our interest to the bank on capital advanced. We are entirely cheese factory as we believe it pays best. As to cost. A factory to work the milk of 700 or 800 cows for cheese would cost i-700 ; for butter, if you had water power it would be less. In starting a co-operative dairy factory I would like to impress upon you one very important point. Every supplier should be a shareholder and hold shares in proportion to the number of cows he milks, and every shareholder should be a supplier. Shareholders who are not suppliers are drones. What you want is milk and plenty of it. Money can always be got if the security is safe. We started on the basis of I.J shares to each cow. Of course we have all considerably increased our herds since that so to equalise matters we continue to deduct the Is per 60 gallons from every supplier until the whole liability is paid up, giving each supplier one paid up share for every £1 so deducted, so that in the end each supplier will have contributed in exact proportion to the benefit he has received. We have each year paid 3Jd per gallon of 11 lbs to suppliers and last year had a surplus of 12000, this gives a very good return to tho dairyman for his labour, aud enables him to make improvements to his property. Had it not been for the factory I can safely say that three out of every four of the settlers here would have had to cave in, iv fact co operative dairying has been our salvation. In connection with the factory a storo was started on similar lines, but altogether a separate concern." The following telegram has been received by Mr Vicary, of Apiti, from Mr Sawers Chief Dairy Instructor : — " I will " meet the settlers re dairying on Thurs- " day the 27th instant. Wire me if this " will suit with the time arranged for " the meeting." A reply has been sent by Mr Adam Cartwright, acting at the request of Mr Vicary, to the effect that the date will suit, aud tho meeting will be held at Mr Guy's Hall at 7 o'clock in the evening.