THE CO-OPERATIVE CRAZE

New Zealand Times, Volume XXXVII, Issue 8342, 31 January 1913, Page 2

THE CO-OPERATIVE CRAZE

To the Poultry Editor, “N.Z. Times." Sir, —A study of the science of economics would, 1 think, be of use to our would-be leaders iu the present cooperative craze; and would perhaps save them ami their followers from a rougu tumble iu the future. They appear to think that if only they could unite all the egg producers in one vast body a new heaven and a new earth would open before their delighted eyes! They believe they could fix the price of eggs; at present they appear to be under the impression that the storekeeper does bo. ' I am sorry to prick this pretty bubble, but there is a certain stern law of supjily and demand that must .be considered. AVc will suppose they succeed iu their efforts, and obtain control of the majority of the eggs sold in Wellington market next spring I Their next step would be, I presume, to fix the price of eggs at say. Is per dozen. If they have enough capital to preserve' the surplus they could do so temporarily. The result would be an enormous increase iu production: every present producer would increase bis output and hundreds of new poultry farmers would spring up all over the country. It would be impossible without lowering the price, to sell all their eggs. Because a few hundred dozen eggs have been exported to Vancouver at a profit, a good many people are under tho impression that some time in the future the eyport market will regulate tho price ‘ for eggs in the same way as it does for butter cheese, mutton, beef and wool. Now, the price of all these commodities is fixed for the whole year by their export values. (Perhaps a slight exception may bo made iu the case of butter, as there is not yet quite enough produced in the winter for our own needs, and a little is stored.) And note! The export price is a profitable price to the farmer throughout the year. Tho eggs sold in Wellington actually cost the poultry farmer from Is 2d to Is id per dozen, and the export price will never probably exceed Is to Is t Id. It the steamers could carry an unlimited quantity in the spring that would realise Is. or Is Id to the exporters it would, of course, increase production, and tho autumn and winter prices would fall rapidly, with the result that the poultry farmers’ average price for tlie year would be no better than, if as good as, at present. lam sorry to appear pessimistic, but it seems to me that the egg circles have done far more harm than good by encouraging over production. Is it not better to have one hundred -individuals -making a small profit at producing eggs than two hundred losing money? The only remedy that I can see is a reduction in the quantity of eggs produced, and this will only bo done by making the business unprofitable to many that are now engaged in it.—l am, etc..

RANGIURU. Otaki, January 19th, 1913. January 23. P.S.—The letter that -appeared last week in your columns is another example of the ignorance displayed by the egg circle leaders. The statement is made that “Levin and district supply the preponderating volume of Wellington’s eggs to-day.” One store alone in Wellington sells more eggs than Levin supplies. If Levin supplies stopped to-morrow their eggs would scarcely be missed; theii proportion of the Wellington market is, I should think, about 3 per cent. Then tho writer cannot understand why, with less supplies arriving in Wellington. this month’s price should.be lower than in the spring. The reason, of course, is that iu the spring every bakery, hotel, boardinghouse, restaurant, most of the stores, and many private houses buy eggs for preserving. Midsunlmei eggs are regarded with suspicion, therefore as soon as the Christmas demand is over the price must drop, as supplies are still abundant. . Tho writer then attacks tho merchants and their system of selling eggs. The merchants simply act .as brokers, eggs are consigned to them on commission, and the higher price they obtain the greater their profit. To sell eggs nf lees than the highest price they could get for them would be both dishonest and foolish, and-they would soon lose the confidence* of their clients! The price is fixed by tho brokers every day, and it is the highest price they can get for the eggs; if they find tho demand is not keen enough to clear Their stocks they of course must lower tho price. As eggs are perishable they cannot hold them indefinitely. On the other hand, when they find the demand is in excess of the supply they raise the pri(J.—“R.”