BUTTER MARKET.

Hokitika Guardian, 16 March 1926, Page 3

BUTTER MARKET.

NO SIGN OF SLUMP. AUCKLAND, March I I. The fears of the producers that a slump would occur in the London butter market as the result of heavy supplies reaching Britain from New Zealand and Australia early this year have not been realised. As a matter of fact just the reverse has happened. During January, when a total of over 14,(XX) tons arrived in London from the Dominion, the market improved as compared with .January, 1925, when arrivals from New Zealand totalled only 8225 tons. Last month prices were maintained at a standard which showed a. better average figure than that in February, 1925. In the circumstances the prospects of dairy farmers realising good returns for their operations this season appear to be excellent. Commenting on the matter an Auckland exporter said there were still certain factors to be considered before an opinion could be advanced that this sea. son’s operations would show better returns than those of last season. The prospects, however, appear to he good. The suggestion that factories should so regulate supplies in January and February as to cover the two months evenly had been generally adopted, and the market had sustained no violent fluctuation due to over-supply. It had remained remarkably even at wliat might he termed a payable price, although considerable quantities of butter had been placed in store. Everything depended on the quantity ol stored butter that would be held when the supplies from British and Continental producers liecanie available. If an early season was experienced in the Northern Hemisphere, some of the Dominion's factories might he caught with a considerable surplus on hand, and would he compelled to take a comparatively low price to clear their stocks. This danger had been increased, it was stated, by the laet that certain factories bad placed reserves on their product, and when prices reached the reserves had increased the limits. This action was entirely at variance with the policy of feeding the market judiciously, and might result in dangerous accumulations being made. DECREASED PRODUCTION. Another factor to be considered was the decrease in the production of butter in the Dominion by comparison with that of last season. Butter graded in New Zealand last January showed a decrease of over seventeen per cent, compared with January, 1925. Tho decrease for the six months ended January 31st was 13.7 per cent. Considering that New Zealand was now such a large supplier to the British market, this decrease could not fail to have a material effect on prices at present. There appeared to he a contest. between the retailers in Britain and the factories that were storing butter. The former were only buying from band to mouth, apparently waiting for the release of stocks that would have to be made when the supplies from Britain and the Continent became available. If any demand for butter set in from the Continent or elsewhere in the immediate future, the position would be improved immeasurably The chances of such a posstbiliv ‘were difficult to estimate locally, but recent buying operations in Auckland suggested that the operators acting on behalf of British houses bad confidence in the future of the market Within tho last few weeks tlieie had been an active enquiry for butter, an sales had been made at Is o-ijl Pf> f.0.1b. for March output. Tins figure represented an increase of a ion ■ per cwt on tlie present London quotation.