DAIRY FACTORY COSTS

Waikato Times, Volume 121, Issue 20259, 30 July 1937, Page 3

DAIRY FACTORY COSTS

UNDER U INCREASE. FIRST YEAR UNDER GUARANTEE. -HINUERA -COMPANY’S POSITION. (Times Special Reporter). HINUERA, Thursday. Although the Hinuera Co-operative Dairy Company, Limited, had last year been concerned regarding the likelihood of a large increase in manufacturing costs due to higher wages, shorter hours and general rises in costs of materials, the chairman, Mr J. E. West, stated at the annual meeting of suppliers to-day that the actual increase in manufacturing costs per pound of butterfat was only .22d. The actual cost per pound of butterfat for manufacturing during the year was i.73‘2d.

“This is the first season under the guaranteed price and the old system of competition among all the companies to obtain the best price has passed under the new method of control by the Government. Whether or not we believe in the guaranteed price we must admit that the return this year for our produce has been satisfactory,” said Mr West in his address to the meeting. Bigger Guarantee Needed. In considering the higher return, Mr West pointed out that higher wages and shorter hours would have to be taken into consideration. “We will feel the higher costs more in the coming year. The Government will have to increase the guaranteed price or the farmers, especially the men on the unimproved land, will find difficulty in meeting the increased costs,” he said. The chairman considered that suppliers to cheese factories would .have been -better off under the guaranteed price than on the open market, but in Ilis opinion the estimated benefit of 3d per lb as put down by Mr W. Ilarbutt, chairman of the Cambridge Company, was very high. Advantages of System. “The Government should come out about even on the guaranteed price account, but I. personally, am opposed to the principle. However, as it is law- it is the duty of all farmers to see that the system is operated in their* favour all the time. One of the advantages of the guaranteed price plan in the chairman's opinion was that the farmers received an early clean-up and the bonus was issued at a time when it was most needed.

"Things have changed greatly during the past year. The farmers must see that they do not lose their identity and -become mere pawns for the whims of the politicians. Lord Bledisloe has warned us against that,” said Mr West, adding that too many people were more or >*ss relying on the Government. 2*iere was a chance that the Government might get more power than the farmers wanted them to. Cows to Sheep. Reviewing the swing from dairying to sheep farming, Mr West said that much harm had been done by the publicity of drudgery and hardship ol farm-life. In reality, although the lot of the youth was not all it might be, the majority of boys received treatment as one of the family. Young men had wonderful opportunities on farms and like many successful Waikato farmers of to-day, could start almost without capital if they worked hard. Overlapping. With reference to the overlapping in the dairy industry, Mr West said that as far as the Waikato was concerned the dairy companies were not having tlie position clarified, despite repeated conferences with the Commission of Agriculture. “fn the first, place the Commission is breaking the “two factory” rule, so we have the position that the 'Commission is on one hand making rules and on Hie other hand breaking them. If that continues we are not going to get very far.” In outlining the absorption of the proprietary concerns by the co-opera-tive dairy companies Mr West said if the Government decided to take such a step in the interest of the industry, then it was their responsibility, in his opinion, to purchase the proprietary concerns. The speaker was not optimistic regarding the -benefits to be accrued from the absorption of the Valley Company. He mentioned that the Hinuera Company had secured 90 per cent of the old Valley suppliers in the Matamata district. More Suppliers Now. Mr J. Milne, a director, said that the Hinuera Company bad received a total of 4 600 cows, which previously supplied the Valley Company. This would mean an increased output nf about 500 tons would result next year. He anl.icialed that within two years the company would be producing 2000 lons. Mr Milne was of the opin'on that the increased carting costs which would result from the absorption of new suppliers would be more ihan off(Continued In next column.)

set by the decrease in manufacturing costs per pound. Good Payout. The company’s accounts showed a total average butterfat return irrespective of grade of 13.74 d per pound. “This is quite good, and very l'ew other companies have reached this point,” said Mr West, who pointed out that the 'Hinuera Company had always been one of the highest payouts for the past 15 years. He congratulated the Cambridge Company on having attained the highest pay-out in the South Auckland this season. The output of the company, 1188 tons, was slightly less than last year, due mainly To some suppliers changing from dairying to sheep farming. The balance-sheet showed that the company was in a very satisfactory position and one of the few which was not handicapped by large interest payments in the opinion of the company's bi nker, Mr E. Mclntyre. More Competition. The company was meeting with more strenuous competition at present than ever before In the opinion of Mr P. R. Hawke, a director, who deplored the fact that outside interests were canvassing Hinuera suppliers to change over to support other companies. The speaker made a plea for the support of all suppliers. The directors of the company for the forthcoming year are:—Messrs J. E. West, P. R. Hawke. F. R. Gibson, J. Milne and the Hon. .1. Cotter, M.L.C. Mr 'Cotter and Mr Hawke retired by rotation, but were re-elected, polling ahead of Mr M. Rates, a new candidate for the directorate. The chairman's honorarium was increased from £BO to £l5O. while that of the deputy-chairman was fixed at £3O instead of £25. The other directors will receive £25. whereas the previous honorarium was £2O ;

' The directors’ recommendation that . a 5 per rent, dividend he declared | was approved of.