WELLINGTON NEWT

Hokitika Guardian, 27 September 1926, Page 1

WELLINGTON NEWT

BUTTER STORAGE PROBLEM. (Special to “ Guardian.”) WELLINGTON, Sept. 24. Recently when stored New Zealand butter was being released for sale the price declined very steadily until it reached about 150 s and then began to advance reaching 1645. There were no definite reasons given for the upward movement, merely that there was a be.tter demand. It seems now, however, that the advance was due to the old policy of running the stuff into cold storage iand thus creating an artificial shortage. At the end of August there were it is estimated about 700,000 boxes of New Zealand butter in store, anl now tho estimate is 1.000,000 boxes, that is during September an additional 300,000 boxes has gone into store. TJio quantity in store is purely nn estimate for no statistics arc published hut the estimates given may ho accepted as fairly reliable for Tooley Street has sources of information to cover such a contingency. This storage business has become a craze with the factories, but the results unfortunately will not pan out to the satisfaction of the producers. Towards the end of next month the first of the new season’s butter under the control of the Butter Control Board will he reaching the market, and this new butter is bound to he overshadowed by tho stored stuff. It is doubtful whether the latter can be sufficiently reduced by the etui of next month. Tf a general selling policy is adopted prices will break, and if stored butter is not reduced in volume it null adversely affect tho new season’s make. Tho position to-day warrants the criticisms of tho English papers who declare that New Zealand dairy factories aro trying to squeeze the consumer. That is 100 obvious to be denied. The Chairman of the Control Board who is now in London declares that there is no intention to exploit tho consumer. Accepting that statement at its face value then the Board will not bold up any butter longer than is neccsary to get it sold; but that is not the intention of the Board. It was stated long ago that the London agency would confer with Tooley Street and “fix” tho prices for the different grades. Tf those fixed prices happen to bo above the market prices the butter will remain in store and will give rise to adverse comments. Tho dairy factories that are responsible for tho present hold-up are likely to suffer very poignant regrets, for the produce will not realise the prices expected even if the coal strike ends immediately. There is no hope of higher prices because the purchasing power is not available. Prices aro more likely to break and that very soon, which will mean heavy losses for those who aro interested in stored butter. Tooley Street will have claims for repayment of excess advances, and the factories will not relish meeting such reclamation. THE AVOOL MARKET.

All who have any opinions t.o express on the wool market aro generally agreed that there is an excellent de-mand-for tho staple at current prices. At tho London sales Continental buyers aro tho principal operators and they are confining their attention to merino and half-bred wools. Bradford has I>cqii operating very cautiously, but Bradford’s business is lieing affected by tho coal strike. As soon as this dispute is ended, and it. seems interminable, there will ho a strong revival in Bradford. There is however very little half-bred wool produced in flic North Island, hut for tho grades . of wool produced the London quotations to-day equal about 13V pence per lb whirl) is on a parity with the prices ruling at Wellington at tho Afarch sales. Tho latest- reports show that the market is active and prices are well maintained. There is every promise that when the New Zealand sales begin on November 15. prices will Insteady and the steadiness of tho market will prevent speculation which often upsets a market. If tile weather holds shearing should commence soon and the catalogues for Hie November sales should show an increase on those ol November last year. -It is somewhat notable that last year and also in 102-1 prices were at the peak in Novemboi, and history may repent itself. U tho weather conditions are favourable for early shearing a lot of wool will ko hurried to the stores for sale in November. Tho position of wool is very satisfactory and it is to be hoped that nothing will be done to disturb lie marketing arrangements.