The Guardian AND EVENING STAR, With which is incorporated “The West Coast Times.” MONDAY, AUGUST 22nd, 1921.

Hokitika Guardian, 22 August 1921, Page 2

The Guardian AND EVENING STAR, With which is incorporated “The West Coast Times.” MONDAY, AUGUST 22nd, 1921.

the dairying outlook. The position in the butter and cheese market remains uncertain (comments the Dominion). The price of butter on the London market has implored, and is reported to stand now qt 2695. to 270 s per < ; wt or roughly 2s bd per pound. This is equivalent to about 2s 2d at the factory in New Zealand, tint it does not appear that any buyers are operating at that figure. lbe buyers are not anxious to commit them selves at present. It is stated that some buyers of cheese are still prepared to take factory outputs at 11 id per pound, but a reporter was informed that the larger buyers are still withholding offers pending further advices from London. Selling methods have been the subject of much discussion lately in dairying circles, and several suggestions have been put forward. One of them is that the New Zealand factories should follow the example of the Canadian factories by selling outl puts month by month. The custom in the past has been for the factories either to sell the season’s output in advance, or to consign and take the chances of the market. The consigning system worked badly last year from the point of view of New Zealand cheese factories, which received a lower price than they could have commanded, if they had sold in the Dominion. The full-season contract has the advantages of enabling the factory to know just what suppliers are going to receive, but it requires buyers to .speculate on the chances of the market for a year ahead, and in these conditions buyers arc apt to be conservative in their estimate of values. The monthly contract system is not altogether new to New Zealand, and it is being adopted this year by a few factories. Its advocates claim that it has the important advantage of the consignment system since it giv- > the producers the benefit of any ad- 1 vnnee in values during the season and that at the same time it secures for them the chief advantages of the contract system, including prompt payment and well-defined values. It is stated that buyers are quite willing to make monthly contracts If fnctorv directors pave to work under that sys

lem. it w. »»»' titioji would ho keener than it is under pres out- conditions, (the buyer would be relieved of some of his anxiety regarding future movements of tie market. He would not require to protect himself against adverse movements later in the season, and so would be able to offer the full market price as iDviyiled by current London quotations. He would know when to expect delivery of his purchases and so would be able to make bis sales accordingly at the other end. The factory would bo free at any time to consign or to ship its cheese and sell it while afloat. “Lately we have heard a lot of talk about ‘bulling’ and ‘bearing’ on the London market and to some extent this is due to the fact that the bulk of the'New Zealand output is handled on consignment at Home,” said one authority to whom this matter was mentioned. “Imagine, for instance an agent handling 10,000 tons of -now Zealand butter and cheese on consignment, and having no real interest in the rifle or fall of the market beyond seeing that his clients were getting the full average price at the time when the consignment arrived. If instead of handling produce on consignment an agent owned all the shipments as they come along (having bought same from month to month in New Zealand) hir interest in holding the market up would be a very live one, and undoubtedly lie more in the interests of the New Zealand producers than, it at present the ease. It is a well-known fact that last year some very heavy shipments arrived on consignment, and most of the shipments were put through on sight, draft. A financial crisis was being experienced, and as the drafts matured before the cheese was landed the one anxiety of the consigning agents was to turn tile dairy produce into money as quickly as possible, irrespective of price. Under the present scheme buyers of a whole season’s output have got to take a long shot, and practically sum up the tendency of the market during the ensuing twelve months and gauge their prices accordingly. The same buyers and many others would welcome a monthly selling scheme and the competition for parcels from New Zealand would be so Keen that not only would the last farthing be obtained for the produce but naturally the result would be for buyers to strive to hold the market up ir order to come out at a profit.”