THE BUTTER MARKET

Rotorua Morning Post, Volume 2, Issue 259, 24 June 1932, Page 6

THE BUTTER MARKET

DENMARIC REDUCES PRICES TO MEET OUR COMPETITION. LESS MARGARINE BOUGHT. "The month of May was another disappointing one for producers," states a circular issued by Joseph Nathan and Company, Limited. _ Consumption continued to be a satisfactory feature, which v/as natural at the low prices ruling. An unusual feature of the trading during the last month or so had been the keen competition experienced from Denmark in reducing their prices al- ? most to the level of New Zealand, in order to maintain their market. Some misunderstanding sometimes arose through Danish .quotations generally being f.o.b. In computing Danish prices as against New Zealand it was necessary to add to the quotations about 12s to 13s per cwt., to include charges and the 10 per cent. duty. "From a careful investigation of the trade, we estimate that^the consumption of butter in Great Britain has increased in the last two years from 6000 tons weekly up to 7500 tons per week, which is the consumption at present," adds the circular. "At the same time we estimate that the saies of margarine have fallen from 5000 tons a week to 3500 tons a week. In our opinion this changeover, which admittedly has been dearly bought, will prove to have some considerable degree of permanency, and be a valuable factor in the future. "The effect of the 10 per cent. tax on foreign butters has not yet had time to make itself fully felt, and the Danes have already shown by their actions that they are not going to give up their market without a struggle, and it is interesting to record that immediately the tax came into force the Danish producers had to reduce their price f.o.b. by the amount of tax in order to maintain their market. This is entirely contrary to the theoretical 'economists, who always maintain that the consumer would have to pay the tax. "It is also interesting to record that since the imposition of the tax the 'Buy British' movement in the North of England has met a far better reception than before, and we for our part have been able to establish an extensive and rapidly-growing sale for New Zealand butter in pats in such towns as Newcastle, Hull, Bolton and Wakefield in the North of England, where previously it had been next to impossible to sell New Zealand butter except at a substantial discount under Danish. "This is a development which we regard as of the utmost importance j to the producers in New Zealand, for ; if it is prove'd under present conditions that we can successfully carry ; the trade in New Zealand butter into territory which has for years past been regarded as the sole preserves of Danish and kindred butters, it wil1 lead to a very satisfactory widening of the market."