DAIRY FARMERS' UNION ADVICE TO MEMBERS

Shannon News, 21 June 1927, Page 4

DAIRY FARMERS' UNION ADVICE TO MEMBERS

Fanners' Finance and Bank Rate of Interest THE CAUTION AND ECONOMY

'Unfortunately, a serious drop in Values!, in botOi butter and cheese is being experienced, the ■>fl&a annual payments averaging probably 3d to 4d per lb butterfat less than last season. This fact your executive leek in duty hound to point out, at the same 1 time urging the greatest economy duiingthe coming winter months. There is every indication that serious diiffculties are ahead of New Zealand farmers, and these r difficulties will certainly not be •lessened by the serious drop that taken place in the export

value of our produce." 'ln the above words, the president ©f the Dairy Farmers* Union, Mr. N. Campbell, in his quarterly report to ;the-members of the Union summarises 4he result of the dairying season just drawing to a close.

From a productive point of view, ha says, the current dairy season has been a very satisfactory one. Most district* Bhow an increased output, a fact particularly noticeable north, and the season will probably close with an increased production of 10 per cent, over the previous season. The improvement ln Quality Is - how " ever, even more pronounced, due probably to the system adopted by the Dairy' Produce Board of paying for butter and cheese on a quality basis, and the efficient system of farm instruction and inspection. Farmers' Finance.

Touching, on the question in our last letter to members, continues the report, we pointed out the precarious state and the unsatisfactory nature of the present system of finance for New Zealand farmers. The position has by no means improved since, in fact, there appears. to be ample evidence to-day that the Government lia 9 no intention of tackling this question in a manner that is likely to afford genuine relief to the average ■ farmer. The Advances to Settlers Department has been given no financial assistance for many months past, and applications for loan 8 by the thousands have again accumulated with this Department with little or no hope of ever being overtaken. The Rural Advances Act, with its Rural Advances Board, has also come into existence, and, according to a statement made by the Minister of Finance, a thousand or more applications for loans have been transferred from the Advances Department to the Rural Advances Board. This Board has been set up with a Government grant of £5*00,000, and farmers wishing to apply for loans on mortgage might be quicker served by applying to the Board, rather than the Advances Department. Some doybt exists as to the future Of the Advances to Settlers Department. There seems to be reason to believe that by endowing the Rural Advances Board with an initial capital of £500,000 the Government hopes to divest itself of any future responsibility of having to provide additional capital for the Advances Department. If thl a is.Jhe case, there will be little hope.of cheap money for many years to come, and even less of ever conVerting our present unsatisfactory, abort-dated mortgage system into a long-dated system, with mortgages repayable on an amortisation principal. Increased Bank-rate of Interest. The Increase in the bank-rate of interest as instituted by the Associated NeW Zealand Banks, came as the greatest surprise to all. From the j farmers'; point of view, It would have been impossible to choose a more inopportune time than the. present for an increase in interest, and so far . your executive cannot see one single good reason for such a Btep. It is intended to make the strongest possible , representation to the Prime Minister and the Minister of Finance, pointing out the serious effect this increase will have on primary production. The advances made by New Zealand banks in the shape of overdrafts are particularly heavy at the present time, and' the farmer will be called upon, not only to pay the increased charges on his own overdraft, but the business man and almost every other section of the community will pass oh the in- ' creased charges, the biggest portion of ■which.will eventually have to be paid by the farmer. Apart from this fact, however, the bank-rate of interest sets the standard of. all other rates of interest, and the ' increase will be directly reflected in .the interest rate on loans and mort-'"-jgagea of all kinds. . The present action of the New Zealand Associated Banks shows once more the absolute necessity of a State or an Agricultural Bank, and it seems deplorable that there is not sufficient unity and co-operation among the « iyrlmair producers of New Zealand to 1 utilise their united influence in. an. endeavour to secure some of the advan-

tages which we know to be absolutely essential to the welfare of the industry.

Our members will be pleased to learn that arrangements have been finalised in connection with the early establishment of a National Dairy Institute at Palmerston North, consisting of modern laboratories, a model dairy farm, and model butter and' cheese factories. Apart from research and investigation into the many problems of the production of raw material, the manufacture of dairy produce, and the utilization of by-pro-ducts, facilities and opportunities by way of short courses will be given to our present dairy factory staffs, which should prove highly beneficial, and should be greatly appreciated. The Dairy Institute is merely the forerunner of an Agricultural University College, so that there is every hope that in -a very few years New Zealand farming will not only receive every assistance that science can give, but agriculture in general will be placed on a higher standard than has been the case in the past. Cheap Fertiliser. The almost sensational developments in the fertiliser market have received the careful attention of your executive, but the. only fact that seems certain is that the exceptionally low prices have greatly increased the demand. How long the present prices will continue is difficult to say, and will probably depend on the question whether present prices show a margain on manufacturing cost. We can only strongly advise dairy farmers to invest, as far as Individual circumstances permit, in fertilisers while prices are low, and we hope that dairy companies will assist their suppliers in this connection by providing credits fcr the winter months. Topdressing has proved itself the dairy farmers' best investment, and this is particularly true during the present period of low prices.

Machinery. Inspection,

The executive is endeavouring to abolish the farce and waste of money of our present system of machinery inspection. With the installation of motors into dairy farms it is preposterous for the Government to send men with high salaries and heavy travelling expenses every year, from farm to farm, for .the purpose of inspecting motors and dairy machinery, and saddle the farmer with the cost. Every motor installed in a milking shed has to be inspected and approved of by the Power Board, and as far as we can see, there is no necessity whatsoever for the present farce to be kept up any longer. So far, our representation has not been successful, but we do not intend to allow the* matter to remain where it is.