DAIRY PRODUCE CONTROL

Hokitika Guardian, 26 March 1925, Page 4

DAIRY PRODUCE CONTROL

SOME PLAID i-.U’l S ill. The two main arguments put forward in support of “absolute control” —ill at it is the only means by which shipments to the London market can he regulated, and by which the disturbance of the market by speculators can he prevented—have been discussed. It remains to mention only two or three minor contentions which have been advanced by the .supporters of the extreme proposals of a majority of the members of the Dairy Board. Denmark’s successful invasion of the London market is being quoted in this connection with the implication that the .Danes employ the methods the hoard is now contemplating. But, the truth is that compulsion never has been employed in Denmark. 1 lading in Danish butter is absolutely free. The members of the hoard’s delegation in their own report, make this point perfectly clear. They say that about 2d per cent of the total output ol Danish butter is purchased in Denmark from the dairy factories by two of the large British distributing concerns, the Co-operative AA'holesnle Society, and the Maypole toy, which have their own agents in Denmark and buy from the factories direct. A further -JO per cent of the output is sold by the factories to export merchants, and the remaining ltd per cent is handled by eleven separate co-operative export associations. 1 here is. therefore, neither compulsion' in Denmark nor any big organisation dominating the position. Ihe whole of the marketing is done under the stimulating influence ot competition in the open market. The Danes sell practically the whole of their produce in their own country, consigning little, or none at all to Britain. The supporters of absolute control by the Dairy Board have called to their assistance, strangelv enough, the ease of the various co-operative associations in Amelina, which handle fruit, cotton, tobacco and other produce on behalf of the growers; hut here they surely cannot expect to find a precedent for compulsion. There is no compulsion of any kind in connection'with these concerns. They meet free competition in all the markets they enter and do business only if they render a hotter service than do their rivals. Il EA'O LUTIONARY -METIIODS. The proposal of the Dairy Board to handle the whole of the New. Zealand dairy produce on consignment is opposed to all the principles of successful marketing in other parts of the world. Practically, the universal system, whether farm products or manufactured articles, is Lo sell the commodities in the country of their production. If wholesale buyers want these goods for distribution purposes, they must obtain then', in the country of their origin, either through agents or .b,v ilirool, purchase. Danish butter is practically all sold in Denmark. If British buyers want it, they go to Denmark to buy it. If German buyers want it, they must do the same. The Danes do not consign it anywhere ; they sell at home. It is the same with Canadian cheese, the chief competitor with New Zealand cheese is the Homo markets. Practically the whole uf the Canadian cheese is sold in Canada. It British buyers, or German buyers, or any other buyers want it. they musl go to Canada to get it. just as they would have to go to Denmark to get Danish butter. The same rule prevails in regard lo New Zealand and Australian meal. Aery little meat is sent to London on consignment. The producers in both countrio;; sell their meat

as near as they can in their own farm.;. Wool is another example. Xow-a-da,vs almost ail the New Zealand and Australia clips are sold m the country of their production. The same rule applies to ina mi fad tired goods. Consignments on any large scale are rarely, .it ever sent abroad. ManuI a during count! if- sell Ibrir good, where they are manufactured. and overseas countries that want them for distributive purposes go to Ihe market. Calcutta jute goods provide another example ot ibis almost invariable nr.ictice. New Zealand is a large buyer of both eorn sacks and wool parks; hut if a New Zealander wrote to the Calcutta inaiiufaeLiirers informing them ilmt there was a good market for their wares in this inuntry. lie would 1, ; lold that the corn sacks and wool packs were nnmiifnet tired and sold in Calcutta and Dial, if New Zealanders wanted them they must buy in the usual market. CACHE AND EFFECT.

Tlicse things do not ha pen without a cause, if consigning to consuming mark -ts were a better system of marketing than selling goods where they are produced, the consigning system would have grown and become firmly established. But the very reverse has Been the ease. The consigning system is well-nigh ihsul. 'Producers in every part of the world, whether of the soil or the factory, sell their goods in the country of production, and they do this, not because they have no choice, hut because, many years of trading experience has proved it to he the best system. Attempts are being made to persuade the farmers and the public at large that tho opponents of absolute control hv the Dairy Board

are averse to co-operative marketing. There dees not apnear to he the slightest ground for this imputation. A business man of very high standing in the community has given it an emphatic denial. “I am very strongly against the compulsory marketing of all the Dominion’s dairy produce by the Dairy Board,” he said the other day when interviewed on the subject, “ hut I am not against co-operative marketing. T believe that well-managed co-operative

organisation, and I think this opinion is shared by the whole business community. It is absurd to describe us

as being averse to co-operative marketing or to anv other legitimate, effort.” .Many other prominent business men have expressed themselves to the same effect. They are equally un-

j animoiis, however, in .saying that it the Dairy Board takes complete control of the whole of the Xew Zealand butter and cheese output and consigns it to Great Britain for sale it will mean that no section of the trade will he interested in keeping prices up while every section will he interested in bringing them down. IX COXCD 17SIOX. Finally, it has to be said there are problems in connection with the assumption of absolute control by the Dairy Boai'd which do not appear to have received sullieient attention from the promoters and advocates of the movement. The hoard’s policy in consigning the whole of the Dominion’s | dairy produce to Great Britain for | sale on account of the producers, at such prices and under such conditions as it may think tit, thus practically constituting itself the sole seller, in | addition to antagonising the trade, as already suggested may easily lead to the constitution of a sole buyer. This might he brought about either by trade organising to fix a limit or the Imperial Government setting up a purchasing hoard with authority to fix prices. In neither case would this he

good for New Zealand. Readers of the London papers will have gathered that many people at Home are becoming restive over food prices and hinting that the Mother Country is being exploited by her ovor-seas Dominions. Leading jouranls have gone to the length of demanding that prices shall Ire fixed with some regard to the interests of British consumers, and not "'holly in the interests of the over-seas producers. Then there is the question of finance. The Chairman of the Dairy Board in iii.s platform campaign in support of absolute control lias stated that lie has assurances from the London commercial houses on this point, hut so far as can he gathered from the reports of his remarks these assurances seem to he no more tangible than

“ friendly conversations.” Probably the commercial houses, would he ready to arrange reasonable advances against shipments, but ii. is doubtful if they would he equally accommodating in regard to produce stored for an indefinite period in the Dominion, and certainly they would not take over the liabilities of individual farmers and factories to the merchants and shippers who are to be pushed out of the business.

These are a few of the points which require to he cleared tip before the Dairy Hoard can expect Lo find the community unanimous in approval ol its proposals.