ECONOMIC COMMITTEE

Hokitika Guardian, 2 September 1926, Page 3

ECONOMIC COMMITTEE

REPORT PRODUCED. [Australia & N.Z. Cable Association.] (Received this day at 11.0 a.m.) LONDON, September 1. Outstanding among the conclusions ill the Imperial- Economic Committee's report on the preparation of marketing of Empire dairy produce is a warning that Empire producers must effect economies iu order to meet the inevitable severe competition in Britain’s trade. The United Kingdom in 1021 spent sixty-three millions sterling on the purchase of butter and cheese, of which 33 millions or fifty-two per cent came from the Empire. The annual consumption of butter pci' capita in Britain increased in the last 2(1 years from fifteen to sixteen pounds weight, compared with twenty-eight in Canada, and twenty-seven in Australia. The British demand for butter and cheese is expanding Imt there are indications that foreign countries are making considerable efforts to recover and improve their pre-war trade position. Most likely in the next few years competition will he more severe, notably from Argentina, Siberia, Russia and the Baltic States. In competing with northern countries, wthere the wages and standards of living are relatively low, the marketing and preparing of Empire dairy produce greatly improved in recent years. “ While there is room for further improvement,” the report says, “we arc of opinion it is necessary to look in other directions for the economies necessary to meet the competition which we foresee. Our main conclusion is that both at Homo and overseas it will not he practicable to maintain the present standards of living among those dependent on the dairy industry, unless farming interests in order to meet such cutting prices as may come from increased competition, prepare without delay for the adoption of more efficient and cheaper methods of production.

Fortunately there is room for such improvement) by means of increased ouput without any great increase in cost. The quantity of milk and butter fat from individual cows and the number of cows to the acre can be greatly increased. Cow testing should he generally adopted and hv attention to breeding and improvement of pastures and Fodder crops, a. greatly increased output would he obtainable without the equivalent of additional cost, Owing to the distanco of the southern Dominion, the hulk of their supplies do not arrive till the beginning of the year, where as the northern countiies supplies are relatively close at hand, ami marketed in the greatest quantity during the spring or within three or four months after the southern. Prices sympathetically follow tho supplies. There are two low periods January and 1 February, and Apiil and .May hut there is usually a steady rise in the latter half of the year. Denmark by means of winter dairying has succeeded in regularising her exports to Britain, so that the monthly quantities vary little with . tho season. % Tho report strongly urges all parts, of tho Empire to carefully consider tho practicability of more winter dairying. Where, this is impracticable and storage must he resorted to in order to regularise supplies, we recommend tho storage far as possible should ho in tho country of production, and only so much ho stored in the United Kingdom as is necessary to eountei balance the irregular arrival of ships. We reinforce the recommendations of Linlithgow Committee and the local •commission on food prices, that statistics of produce held in storage should bo published, as is done in New Zealand. Dealing with the effect of retail prices on consumption, the committee emphasises that a fall instantly increases tho consumption but the retailer naturally objects to too fioqnent changes., and elnims that by feu changes only can ho on the average, convey to the consumer, the nett effect of many ups and downs in the wholesale price. The Committee comments that tins may ho so, although many are of opinion there is often an niidue lag in retail prices when the wholesale price is falling, especially at the end of the year, owing to the arrival of oversea stocks which should result in a definite increase of consumption, and prevention of nceumulhtion, with the steadyin pc of the wholesale price. Dealing with the Control Board’s report it says “we recognise the conditions of the market, irregular arrivals and fluctuation of prices justified producers in taking special steps to saleguard the interests and the remedy tor speculation arising from, price fluctuations, is the rcgularisation of supplies and stimulating of the demand. There is a natural fear among traders that such Control Boards might ho tempted to abuse their powers. We strongly urge upon these bodies a policy of moderation in the use of their powers. Should (hoy follow a policy of lio.dmg up supplies for reserved prices, which are adopted by some New Zealand factories, they will be venturing on a dangerous experiment of mass speculation. hut if they limit their activities to regulation of shipments or development of marketing, they '-ill benefit both producers and consumers. There is little to be said concerning cheese. No less than ninety per cent „f the United Kingdom demand is already met from within the Empire. The Committee repent their advocacy or identification of origin, publicity and research in relation to dairy produce The committee are emphatic m the opinion that there i.s no reason why freight from Australia should he higher than from New Zealand. They also examine the methods ot selling Australian and New Zealand but- * ter in London and express the hope tbev will see a system evolved rendering overseas producers as little dependent upon the importer for financing produce, as tho Danes aie. In conclusion, the Committee express tho opinion that good may result from control bodies giving a weekly lend as a guido to the market price, but the Committee are definitely opposed to any attempt to secure a. sysem ot fixed prices.