THE BUTTER MARKET.

Taranaki Daily News, 12 May 1922, Page 8

THE BUTTER MARKET.

/ j . POSITION IN ENGLAND. X- A. GENERAL REVIEW. In a general review of the English butter market, under date March 27, Mr. R. Elison, London representative of the National Dairy Association, says: “The unexpected has happened, the butter market, has suddenly developed great strength and has rapidly risen from 145 s to 178 s. On the 14th the price was 1445. On the 18th it had risen to 150 s, and in the course of ten days the total advance represented 34s per cwt. There are several reasons for this sudden and somewhat unexpected rise in values. The real reason of the strength of to-day's market is to be found .in the slump which occurred last December. New Zealand butter at that •period reached bottom at 115 s to 120 s, and really good serviceable butters from Australia and the Argentine could be bought round 100 s, in addition to which there was the Government stock of butter to contend with. This, as you know, passed, into private hands. This in itself helped the market. The retail price of butter was general at Is 2d to Is 4d per lb. It is now quite evident that the public have for the last three months been gradually getting back on to butter and discarding margarine the (latter can now be bought for 6d per lb). Butter at Is 4d was better than margarine at Bd, lOd and Is per lb., and freed from the restrictions and high prices of ; the war period, the consuming public have re-established their belief in butter.

“The shipments of butter from Australia have been heavy. The same can be said of the supplies from our Dominion. At this period of the year the Australian supplies begin to diminish rapidly, and to a lesser degree the shipments from New Zealand.

“During the early part of this season quite appreciable quantities of butter were coming from South Africa. These have now practically ended. It is said that the low price of butter ruling here made it quite unprofitable to produce butter in South Africa for this market.

“A factor which will play a big part in the future of the butter trade is the entire elimination of the Siberian supplies, which used to reach this country to the extent of 35,000 tons per annum.

“The imports during December and January, coupled with the Government stocks, were much more than could be consumed. The supply wa« greater than the demand. The low retail price and the gradual falling off in the imports has now reversed the position, and to-day the supply is not equal to the demand, and prices will have to be raised retail to Is lOd and 2s. This will have the effect of throwing a section of the consumers back to the use of margarine. “During slump period there took place an accumulation of many kinds of secondary butters, including Government stocks. This has now entirely disappeared. and the market should for some months be of a healthy description. “Dairy farmers in the United . Kingdom are experiencing a bad time. The wholesale price -of milk has, up to the end of March, been Is per gallon. From April 1 the price has been fixed at 5d or 6d per gallon. The effect of this will be to convert large quantities of milk into cheese, not butter.

It is possible for some time to come butter prices in this country may be during the summer on as high a level or higher than winter prices. Especially might this be so if Australia and New Zealand can maintain their last season’s increase.

It is satisfactory to again report that a very high standard has been maintained in the make of New Zealand butter. The time will come when its value will be understood and recognised. This' desirable state of things could be accomplished much more readily if marketing conditions were radically changed, and in mentioning this there is no suggestion that existing channels of distribution should be scrapped. The outlook for butter during the immediate future and for the next month or so appears to be much more favorable than that of cheese. Butter should be maintained at present values. It may even go higher. Cheese, on the other hand, -is accumulating in New Zealand. This is going to mean a very serious loss to our producers. By the time this cheese reached its market we will find the English and Scottish makes are active competitors, and, more serious still, the Canadian make. Cheese for the next month or six weeks should find a ready demand round current prices, or possily something better. From then on, prices are likely to begin to decline, and while we look for butter to remain at to-day’s level, we are inclined to think that cheese will gradually recede in value. It is open for Canada to make butter du.ring the opening months of their season. If so, then our conclusions may be largely upset. It must not be forgotten that the industrial conditions of the United Kingdom are bad, and they are likely to be worse. England cannot alone recover. If recovery is possible, Europe and England must simultaneously recover. Our country cannot expect to prosper and the others stagnate. Speaking of the question of grading, especially butter, we think the time has now arrived when the second grade stamp could be conveniently withheld. By all means stamp the first grade on boxes answering this description, but allow the others to come here without advertising the fact that they are seconds. There are markets when second grade will bring equal to first, and there are many buyers who cannot determine which is first and which is second, but if the boxes are distinctly marked second grade, then the buyer, in spite of quality, refuses to pay the price.”