BUTTER MARKETING

Hokitika Guardian, 29 May 1930, Page 2

BUTTER MARKETING

MODERN AIETHODS NEEDED

The low prices ruling during the last few months for New Zealand dairy produce on the London market lias concentrated attention on the marketing side of the industry.. 3o members of the Auckland Creditmen’s Club Mr T. L. Humes, secretary of Amalgamated Dairies, Ltd., delivered an informative address under the heading, “The Market.” H

In stating that the United Kingdom: was still the Dominion’s chief market for dairy produce, Mr Ham* referred to the desirability of increasing and developing alternative outlets. An excellent trade was being done-with Canada in butter, oo l ai this.season about 7000 tons more New Zealand butter had gone to Canada than in any previous year* Naturally producers in New Zealand did not .view with favour the increase in Canadian tariff from 1 cent to 4 tents per fb' of Ibutter, but lie was of the opinion that, there was, still a la. l go butter trade to be done with Canada, even at a 4 cent duty. Referring to the United Kingdom butter market, Air Humes stated that for various reasons the methods of 10 and-.2o'.years ago were not altogether satisfactory to-day. The greatly increased tonnage from New Zealand, much of which arrived during a few flush months, in itself meant that different methods were required. Aljoreover, there had been radical changes during the past few years in the methods of conducting business in Jhe United Kingdom. Where •years ago the great bulk of the retail business was done by individual grocers. in recent years the power of the multiple shop organisations and the co-operative societies had grown enormously. The tendency during recent years had been for many businesses to concentrate under big amalgamations, and the dairy business .fypis -no • exception, particularly aft '.far '.as-the multiple' shop organisations ' were ' concerned, There • bed beeni merger, after meigef, .and one h'u'ge ' merger, with capital and ’ serves exceeding £70,000,060, was now reported to,-be hi control, of most of the various . groups of chain stores. This meant that 1 the buying for these organisations was concentrated, as ■ was - also-, the. .buying for the .co-opera-tive' societies. •

LOVER BUTTER TRICES

Further, the independent grocers, also-were forced to. organise .in order to pool their purchases and buy more effectively. The result was that it was' now not the Importers of butter who had the greatest power on the market, but the strong buying groups representing retail concerns. ! Air Haines' gave the reasons for the very much lower butter prices received this season as follow:First, world-wide tendency towards a lower price level, particular}' for food products. Second, the larger production of New Zealand and Australian -butter, coupled with increasing supplies from the Northern Hemisphere.

Third, the influence of the New York financial crisis of last October, which -caused unexpected liquidation of stocks in London, thus depressing the market.

Fourth, the strength of the improved butyeirs’ organisations, . which had been most remarkably demonstrated during the - past five ol* six months of falling prices, with ample supplies of butter available and in sight, enabling the buyers, with* their splendid organisations, 'to 'take full advantage of these circumstances in their favour.

CO-OPERATIVE MARKETING

From the point of view of the New Zealand dairy farmer, /the position was well summed up in the hackneyed old saying, “United we stand, divided we fall.” Expert opinion put it that all our butter could have gone into consumption at a retail price of Ih'fid "per lb, but it had gone to Is 4d owing to excessive competition for a considerable period. New Zealand Was the only country in the world to-day where co-operative concerns were not marketing their produce in groups. Undoubtedly a lower level of prices must be expected in future years than Ims been received in recent years. Moreover, it had to be realised that, production was constantly on the increase, particularly in the Auckland Province, and the big marketing problem of the next few years was going to be to find a market for the increased production it was reasonable to expect. Mr Hames expressed the opinion, however, that we were justified in believing that in the Auckland Province increased production would largely compensate both the farmers and the community for the lower prices to be expected. A-tribute was paid to the'-,dairy farmer for what he had done during the past few years to improve his efficiency and increase production Tlie production per man on Cup dairy farms of the province, particularly in South Auckland, and the great increase in the average production per cow, wore really marvellous. Few industries during the past ciglt pi; ten years could show such » great advance in efficiency as the farming industry.