PROFITS FROM MILK

Sun (Auckland), Volume 1, Issue 3, 25 March 1927, Page 9

PROFITS FROM MILK

WELLINGTON SYSTEM PRIVATE VENDOR GOING EQUALISATION OF PRICES So successful have the operations of the Wellington Municipal Milk Department been during the past year that it is expected to produce a balance sheet at the end of the present month showing a profit of something in the vicinity of £19,000 for the past 12 months. Of this big surplus £IO,OOO is to be utilised to offset the losses suffered on the winter supply of milk to the city, and £7,000 will be required to extinguish what was aptly described recently as a “dead horse," which the department has had to carry for some time through over-cap-italisation on the building and plant. A chat with Mr. W. H. Bennett, chairman of the milk committee of the City Council, was sufflciently convincing to remove any doubt a,s to the efficacy and commercial success of a pasteurised milk supply when properly conducted under municipal enterprise, for it was under his watchful eye that this branch of trading has grown from lusty infancy to middle-aged maturity. The extra 85 per cent, which the council had to pay for winter supply could not be passed direct on to the family man whose morning quart of milk was a drain on the weekly houseallowance, so a scheme was evolved whereby the summer milk must bear portion of the winter losses. During the financial year just ending the sum of £8,500 was set aside from the profits on the summer supply, but owing to the low prices ruling on the Home market for butter and cheese this amount was not fullyabsorbed. Careful computation was made as usual in accordance with the trend of the English and colonial mar kets, and at the beginning of last summer the price to the consumer was fixed at 6£d a quart, based upon the assumption that the market would remain steady. After a month or two, however, the slump affected the position to such a degree, and such big profits were being made, that the price was reduced to 6d a quart. This did not sound much, but Mr. Bennett ceased drawing milk bottles and pasteurisers on his blotting pad and worked it out to mean £1,250 a month to the department. During the coming winter the price of milk is to be 7d a quart, or Jd less than last winter's price, and to offset this discrepancy in receipts £IO,OOO is being set aside from previous profits. Meanwhile the municipal milk enterprise is extending in every direction, and gradually forcing the private vendor out of business. A site of one and a-quarter acres has been taken under the Public Works Act tor a new station, and the plans have been sent to America —the home of the bottled milk supply—for expert advice upon methods of construction and operation.