SHORTAGE OF BUTTER.

Manawatu Herald, Volume XLI, Issue 2007, 26 July 1919, Page 3

SHORTAGE OF BUTTER.

AFTER EFFECTS OF DROUGHT,

PROSPECTS OF NEW SEASON,

There is an acute shortage of

butler in many parts of Ihe Dominion, and restriction of consumpti-

on may have to be exorcised in some localities. At-the end of April last there were 82,0.00 boxes of Imllev in

store, and this quantity, supplemented by the normal winter produclion, would have been ample to meet domestic requirements. However, (he winter make of butter was only about one-balf of what was anticipated, consequently the calculations of the trade were (brown on! of gear. The shortage was due to unprecedentedly dry weather at the end of the season. This drought, it may be recalled, was very serious indeed in many Imtler-prodncing districts, and notably in the Auckland district, which is the largest butter-producing territory in the Dominion. Quite a number of factories that had been opened more or less continuously were compelled to close down daring the winter months. There is a fair amount of butter in stock, taking the Dominion as a whole, hut a scarcity in some parts of the North Island and generally in the South Island, and the latter is dependent on the North Island for supplies. There is, however, not quite enough to go round. No butter has been shipped away from the Dominion since the beginning of June, and that remaining which was originally intended for export will be distributed in order to raCet the local shortage which, it is admitted, has now become aeute. Unfortunately, the quantity of “export” butter that will be available is not large. THE PRICES FIXED.

The price fixed with respect to butter is Is 5d per pound at the factory door, and Is 8d per pound retail for first grade creamery butter. It was generally understood that the wholesale price on the Is 5d basis would be Is 6d, the Id difference being to meet cost of carriage, insurance, packing, delivery, and other charges, and to allow a profit to the wholesale distributor. The retail distributor bought at Is fid and sold at Is Bd. Since the shortage has compelled factories which supplied the local trade to themselves buy where they could they have not been supplying retailers at Is 6d per lb., but at Is OAd, and the increase is due to themselves having as, say, in the ease of Canterbury and Otago, to buy butter in the North Island and pay expenses on - its carriage to themselves for packing and distribution. RETAILERS’ PROFIT. The profit of ltd per lb. to the grocer is held to be “too fine,” and it is so, if it is necessary, as is generally agreed by the trade, for the grocer to run his business on at least a 121 per cent, profit, which is 2s fid in the £l. This will explain why retailers, who are paying'ls Old per lb. for butter they retail at Is 8d say they are selling at a loss. The Post has been authoritatively assured that the shortage.is not due to speculation or holding back of supplies, because the factory price and retail price being fixed there is no inducement to hold butter or speculate in it. Factories, too, which have to buy butter to keep their customers going are unable to sell the same at the Is 5d rate, as when they were manufacturers of butter. THE NEW SEASON. As to next season, about to open: The majority of dairy factories "’'commence the new season’s make not later than the .beginning of August, in fact, some of them in the north re-open about the middle of July, So far as can be ascertained at present, there is every indication of the 1919-20 season beginning within the next two or three weeks in the North Island, speaking generally. Given favourable weather conditions, the production of butter should soon overtake the present shortage of supplies, which is hut ..temporary,