PRICE-FIXING DROPPED.

Wairarapa Age, 15 March 1927, Page 5

PRICE-FIXING DROPPED.

DAIRY CONTROL BOARD RESOLUTIONS.

NEW POLICY MAPPED OUT. E — RESTRICTIONS LIFTED. WELLINGTON, March 14. The New Zealand Dairy Pro4- dace Export Control Board te-day decided by six votes to three te rescind “all resolutions and restrictions dealing with the fixing of prices.*’ The board at its special meetings on Saturday and to-day fully considered B the existing marketing position of butR ter and cheese, and as an outcome resolutions were passed freeing importers from the named prices and requiring them to sell weekly 90,000 cases of butter and 45,000 crates of cheese, and to clear arrivals and absorb accumulated stocks by the end of May, in the case of cheese, and the end of June, in the case of butter. The restriction upon the weekly quantity to be sold is designed to prevent the speculative absorption of the whole quantity now available at low price levels to the disadvantage of the producer.—(P.A.) K A MESSAGE FROM LONDON. NEW PLYMOUTH, March 14. Private cabled advice received from London in New Plymouth yesterday, stated that the Control Board had agreed to the London merchants selling on their own terms ninety thousand boxes of New Zealand butter weekly and fiftv-five thousand crates of cheese weekly.—(P.A.) A MISTAKEN POLICY. WAIRARAPA BUSINESS MAN’S VIEWS. ■ **< ■ > i> * A BOYCOTT INVITED BY BOARD. An emphatic opinion as to the necessity of immediate measures to secure the restoration of a normal market for New Zealand butter in Great Britain was expressed by a prominent business man in a statement made to an “Age” representative yesterday. The Dairy Produce '’Control Board, he said, had pursued an ill-judged and mistaken policy, with results that were already very serious to dairy farmers and others concerned in the industry, and this policy must be amended and modified without delay if even more serious harm was to be averted. “In my opinion,” said the authority in question, “the Control Board is a splendid thing, provided they do not go beyond the functions they ean exercise safely and with advantage to the industry. It is open to the board to do very valuable work in regulating shipments, negotiating and arranging freights and insurance, securing a progressive improvement in grading and standards of quality, and carrying on such a publicity campaign as will maintain and increase the popularity of our dairy products in oversea markets. As, however, New Zealand supplies only about twenty-two per cent, of the butter imported by Great Britain, we are obviously not in a position to dictate to trading concerns. By giving grounds for the idea that it contemplated the fixation of prices, and by cutting down the commission payable to brokers from 24 to 2 per cent., the board aroused the keen hostility of the firms that are accustomed to handle our butter in London and the result and outcome are seen in the present state of the market—a heavy accumulation of stocks in spite of the fact that a number of price reductions have been made in the hope of quickening demand. Having ample supplies available from other sources than New Zealand, the British firms have boycotted New Zealand butter, with results that are apparent in these figures.” STOCKS AND SALES. The business man here referred to the following table showing the present and estimated position of New Zealand butter on the London market:— Esti- Permated centnge total of shipments total y / for season (ap-1926-27. prox.) Boxes. Boxes.

“It wZ he seen,” the authority observed, “that sales of butter by the

board have recently averaged only 26,000 boxes weekly, whereas it is necessary that sales should average 90,000 hexes weekly in order to clear stocks and arrivals. In other words, sales are proceeding at little more than one-quarter of the rate that is necesr sary if we are ta avoid -a heavy accumulation of stocks Tn London and all the evils that follow upon that state of affairs. The multiple shops and Tooley Street play a commanding part in the distribution "of our dairy produce in Britain, and in my opinion to get back their good will we must revert to the old system of free trading, with due provision for f.0.b., c.i.f., and forward buying. This would give our factories a free hand to either sell forward or consign Home through their agents as they have done for many years. This in my opinion, is the only way to* get the present boycott lifted. LOCAL EFFECTS OF BOYCOTT. “The effects of the boycott are being felt very severely in the Wairarapa,” the authority added, “and the reason, of course, is obvious. Ninety per cent of the Wairarapa factories are only paying one shilling a pound advance on butter ffat as compared with Is 6d to Is &d, and even as much as Is lOd. prior to the institution of control. The present state of affairs means that the dairy farmer cannot carry on, and a great number will have to walk off their farms unless conditions change immediately for the better. It makes things worse that many factories still owe their suppliers a portion of last year’s bonus.’’ A REASONABLE POLICY.

Indicating what in his opinion would be a reasonable policy for the board to adopt, the business man quoted a letter from one of his correspondents in London, which read in part as follows:— “I think absolute control is killed, and possibly the fixing of prices—I mean rigid prices. I think there will be a modification of the procedure and that the board will give an indication of the price, biit will leave wholesalers a certain margin of flexibility and thereby create healthy competition. I think, •too, that the Control Board will eventually keep control of insurance, freight and finance, and possibly shipments to a limited extent. However, I think they will allow free play and competition in a certain measure, in order to keep the markets healthy. This will permit of the big multiple shops using: their brains in buying, and they won’t be restricted as to quantity. That will satisfy them. You might even see the reinstatement of c.i.f. and f.o.b. trading, for there is no doubt about it that that class of trade does steady the market. 3 3

A SERIOUS POSITION.

CONTENTIONS OF BRITISH TRADERS.

LONDON, March. 12. The colonial butter market is going from bad to worse. There has been a’ fair inquiry for Australian, not only for the Home trade, but also for the United States and Canada, to which markets about 15,000 boxes of Australian have been shipped from London within the last fortnight. But the demand for New Zealand butter has been so bad that the bulk -of arrivals for some time past have been placed in cold store, with the result that the quantity of New Zealand butter stored is estimated at about 400,000 boxes. This is a serious position, in view of the near approach of the spring and the prospect of large supplies of the Home make, as well as butter from the Continent.

Traders here attribute this unsatisfactory state of affairs largely to the action of the New Zealand Control Board. Their opinion was voiced by the chairman at the annual meeting of the London Provision Exchange, when he said New Zealand control was unpopular in its inception, and it had continued unpopular ever since, and it was not likely to outlive its unpopularity. Its action had been both autocratic and bureaucratic.

“It prevents goods from reaching the consumer in the freshest and best condition, and it must have gone far to nullify any good effect that advertising Empire goods may have produced, at any rate so far as New Zealand is concerned.”—(A. and N.Z.)

Estimated “controlled” stocks at London, Feb. 28th .. 350,000 2,400,000 14} Estimated “uncontrolled” stocks at London, Feb. 28 .. 50,000 Q Total . .. 400,000 Estimated March arrivals ... 350,000 14} Estimated April arrivals 310,000 13 Estimated May » ' arrivals ... 250,000 10} Total London stocks and to arrive - May 31 ... 1,310,000 Sales “Con54} trolled” butter to Feb. 18 ... 380,000 16 Sales “controlled” butter average weekly . .. ' 26,000 1 To clear stocks and arrivals by May 31, sales of control and Uncontrolled must aver- z age weekly . 90,000 3} Estimated stocks to arrive after May 31 ... 080,000 Estimated 28} total London stocks and to arrive for remainder of season . .. 1,990,000 83