NEW ZEALAND FROZEN MEAT AND STORAGE COMPANY (LIMITED).

Waikato Times, Volume XXXI, Issue 2501, 21 July 1888, Page 2 (Supplement)

NEW ZEALAND FROZEN MEAT AND STORAGE COMPANY (LIMITED).

(Hawera Stab.) Thk following letter hag been forwarded to us for publication. Further correspondence on the subject will be published as soon as possible : — Auckland, April 20, 1888.—Sir Harry Atkinson, K.C.M.G.,— Referring to ray interview with you, when it was agreed that I should furnish the result of the company's butter-making operations during the past season, as soon as account sales wore received from England, showing the realisation upon the company's exports I have now the honour to furnish the following information :— I The company has now been engaged in the butter trade for three years. During the first two it has simply been a buyer of butter consigned to its works at Auckland, and has also employed buyers at fixed stations on tho West Coast. All the butter dealt with has been classified and paid for according to quality, the company possessing, of course, considerable advantages over ordinary butter buyers, having cold air chambers at disposal, and being able to keep the butter without further deterioration. The quantity of butter dealt with during the two years referred to amounts to about 428 tons. The company found that this line of business I was anything but satisfactory, as it was I impossible to obtain any quantity of butter of uniform grade and excellence; while in the case of consignments direct from settlers to the company's works, large quantities arrived during hot weather. greatly deteriorated in transit, leading to endless differences with consignees. These considerations, and the apparent hopelessness of establishing on this basis an export trade worth the compaay's efforts, induced the directors to establish a system of creameries, where milk would be purchased from settlers, and where the cream could be separated and forwarded to the works at Auckland, where with every modern appliance of cold air, steam, improved churns, otc., it was hoped that the excellence of the manufactured article would recoup the additional expense. Creameries were accordingly established on the Waikato Railway at Pukekohe, Ngaruawahia, Taakau, Hamilton, and Paterangi, at which during the past five months, from November, 1887, to March, 1888, 534,810 gallons of milk have been received, the cream being forwarded to Auckland, and manufactured into 178,270 lbs of butter, of which about olh tons have been forwarded and disposed of on the English market. The butter was highly reported on, and sold at from 90s to 112 a per cwt, but the nett proceeds averaged only 97s per cwt., owing to certain deductions for "tret" (allowances to buyers, etc.), the equity of which may be fairly questioned, and which may be obviated in the future, but the point was thoroughly demonstrated that under this system unlimited quantities of butter of uniform grade and excellence can be produced, independently of hot seasons, and placed in good condition on the English market. The expenses, however, are considerable, and may be enumerated as follows, viz., Ist. Expenses at creameries, purchase of milk, rent or interest on buildings and plant, wages, fuel, repairs, cartages, and wear and tear. 2nd. Railway fares for employes, freight of cream, fuel, and sundries. 3rd. Auckland dairy department expenses—Proportion of rent and cold air, gas, water, steam, cartages, wages, salaries, printing, and cost of packages. 4th. Freight of butter in cold air chambers, English charges, etc. The nett result has been a considerable loss, and, if the system is to be continued, very considerable ecouomies will have to be effected. The advantages of the system from a manufacturer's point of view are unquestionable, and may be summed up as follows: —Ist The milk is obtained from the farmer at the earliest period, free from contamination or deterioration. 2nd. The cream is at once separated, and forwarded to the head establishment (in cans specially constructed to avoid injury from agitation), where every appliance of cold air is available to secure the proper temperature for ripening and buttermaking. 3rd. The uniform grade of the butter produced. 4th. The safety of the butter when produced, which is kept in cold storage until shipped in freezing chambers for England. From an economical point of view, the system secures the following advantages:—lst. Cash payments to the producer, in place of the barter as against goods supplied by tho local storekeeper. 2nd. Certainty of returns, irrespective of glut in the local butter market, enabling arrangements to be made for increase of dairy stock, provision of green food, etc. 3rd. Prevention of heavy loss now sustained by the community at large, represented by the difference in value of good butter manufactured and exported under this system, as compared with the low value of large quantities of butter now produced and subject to deterioration for lack of proper appliances. 4th. The advantages of fostering the dairying interests, as tending to the advancement of the smaller settler, and the profitable settlement of the land. The experieace gained by the first year will enable several minor economies to be effected, but so to enable tho system to prove a financial success, a large saving on the cost of production is necessary. Such saving may be effected in two ways, either by reducing considerably the price paid for the milk, which has undoubtedly been a good deal in excess of the corresponding market price of butter during the past year, or preferentially by a concentration of creameries, which can only be done provided the rate of carriage of milk from adjacent stations, be largely reduced. At present no supplies of milk are received at creameries by rail, the cost (Jd per gallon for the first 15 miles, and Jd additional for further 15 miles) being altogether prohibitory. If these rates were greatly lowered, the number of creameries could be reduced, with a corresponding saving of expenses, while a revenue would accrue to the railway department, which it does not now possess. It must be borne in mind that milk is oarried at owners risk, and is attended with no expense of handling to the railway department, while in the case of milk carried for creameries the railway department will again receive charges on carriage of cream. Moreover it should be considered that in the absence of the creamery system the railway can look for nothing further than the revenue to be derived from the manufactured article, viz. butter. In the matter of railway charges on milk, these could be paid by the owners of the creameries. I cannot too strongly urge the desirability of this concession in rates of carriage of milk. I believe that no greater stimulus could be afforded to the welfare of the small settler, and the profitable occupation of the land, and I fully believe that even if milk were carried free the railway department would be speedily recouped by the additional traffic following on increased settlement and prosperity of the country districts. The rates which I consider would prove really beneficial, and have a substantial effect in stimulating the dairying industry would be Jd for the first 15 miles and an additional ; 1 jd for each succeeding 15 miles; the present rates being Ad and .jd respectfully.—l have, &c., Arthur 8011, Chairman.