BUTTER OUTPUT EXCEEDS 50,000 TONS

Waikato Times, Volume 121, Issue 20276, 19 August 1937, Page 13

BUTTER OUTPUT EXCEEDS 50,000 TONS

New Zealand Dairy Company’s Year. Annual Meeting of Shareholders. REVIEW OF DIFFICULT SEASON.

Despite the difficult year experienced consequent on the many changes in the industry and the increased costs, the New Zealand Co-operative Dairy Company Limited has enjoyed a highly satisfactory year, the production again showing a remarkable increase. At the eighteenth annual meeting of the supplier-shareholders in the State Theatre, Hamilton, to-day, the chairman of directors, Mr R. 11. McKenzie, who presided, and the general manager, Mr C. J. Parlane, gave comprehensive reviews of the past year, a feature of their addresses being the wide variety of subjects, of especial interest to suppliers, that they covered. Mr W. Goodfellow, Managing Director of Amalgamated Dairies, Ltd., and Advisory Director to the company also gave a very interesting address on matters relative to the industry. From the point of view of production the company experienced a very successful year, the total output reaching 69,757 tons of which butter manufacture comprised the record figure of 51,001 tons. Another indication of the tremendous growth of the company is provided in the gross turnover for the year, this at £7,729,990 15s Od representing an increase of £634,436 7s 4d on last year, despite the fact that last season’s gross turnover exceeded (he previous year by £1,732,290.

BUTTER PRODUCTION.

NEW RECORD ESTABLISHED. OUTPUT OF OVER 50.000 TONS. THE] CHAIRMAN’S SURVIEW. SERVICES TO SUPPLIERS. “ The season under review has been an exceptionally favourable one so far as production is concerned and this lias been relied,ed in an all round increase in manufactured products,' commented Mr It. 11. McKenzie, chairman of directors, in moving the adopltlon of the annual report (previously published) “ We nave, for the first time, exceeded the 50,000 ton mark in butter output, the total manufactured being 51,000 tons, beating the previous season—the then record —by 3500 tons. An increase of 7.37 per cent, on such a large tonnage is highly satisfactory. “ The decline In cheese production, which had fallen steadily over the three preceeding seasons, has been arrested, an Increase of 1174 tons, representing 15.4 per cent, over last season, being recorded. This is gratifying as it is to the advantage of the dAiry Industry as a whole that the balance between butter and cheese should bo maintained. Butter suppliers will welcome a differential In price between these two commodities that will make it worth while for cheese suppliers to maintain (he status quo. “MUkpowder manufactured has risen from (*.031 tons to 6331) tons, an Increase of 308 lons or 5.11 per cent. Congratulations are extended to our dried milk groups on their present capital position and improved marketing outlook. They have surmounted heavy responsibilities under what were often discouraging circumstances. “ Casein shows the greatest per-

centage of increase in the commodities handled by the company, namely 45.71 per cent., the make being: 193435, 931 tons; 1935-36, 1239 • tons; 1936-37, ISOS tons. Prices have been satisfactory and future prospects are encouraging,” be added. “ Neither mllkpowder nor casein came under the guaranteed price, though they had to bear to an ever greater extent than butler or cheese

the Increased wages granted under the anticipated benefits to be derived from (be seberne. This was fortunate for those concerned, for with prices based on the same formula as those for butter and cheese, their returns would have been less than they now are. Increased Costs Heavy. Condensed Milk.—“ The transfer cf plant from Wuitoa to Matangi caused a break in the manufacture of this product, resulting in a lower output from 1953 to 1813 tons,” said Mr McKenzie. “ On a butter-fat basis ibis

commodity has been harder hit by increased costs than any other undei our control. A diversity of export products should be encouraged in the national interests. It is true that ar agreement has been reached whereby condensed milk will have an adjustment under the guaranteed price or the amount of butter-fat in the product, but it may be either way depending on final realisations, but ever If in its favour will be inflnitesima compared with an added cost of 4d pei lb on butter-fat contained in the product. This cannot be classed as ai: aid to our youngest branch of the industry. We commend this case to th€ notice of the Minister of Agriculture “ I am pleased to be able to once again that our suppliers are finding the New Zealand Dairy Finance Company, Limited, of material assistance to them, judging by the increased I demand for finance. During llie year j under review 1490 applications were j granted, involving advances totalling ! just over £121,000, as against 1326 | applications involving £93,000 the I previous year, which In itself was a j record. “ It has been the aim of our finance company to render all possible assistance to suppliers to enable them to improve their farm conditions and butter-fat output and the rate of interest charged has been 'consistently low,” commented Mr McKenzie. Rehabilitation of Mortgagors. “ I wish to thank those suppliers who have borrowed in the past for the way in which they have met their obligations, so much so that the bad debts for the year under review were only £lO7 9s Bd, and the total bad debts since the company started 12 years ago are £2379 13s lOd on total advances of nearly £900,000. Tin outstanding advances at the close oi the financial year (April 30) were £77,427, most of which is secured In way of bill of sale. “We have had a partial oppor- , tunity of studying the effects of a recent relief legislation for rehabilitation of farm mortgagors. A grea! deal of inconvenience has 'been caused to our suppliers who are applicants owing to the necessity on their par: for obtaining the ‘consent of the Conri of Review to further advances whih their applications for relief are pend J ing. It would appear that some tinu { will elapse before the majority of ap- ' plications are dealt with, with consequent interference with llic business side of farming operations. It has been noted, however, that the Adjustment Commissions have shown tendency fo safeguard, where at ai possible, claims of -creditor's who hav« granted assistance to farmer mortga g°rs, and we are pleased to be abb lo say that losses under this head ing will not be great. However, tin company lias been put to a fair ainonn "f expense in protecting its positios nnd arranging representation at thi various hearings. AVe think, however that the least the Government can d< is to arrange sufficient Commissions tc expedite the hearings of all applications within a reasonable time and allow business to proceed on norma lines. Average Mortgage of £l4 An Aore. “ The New Zealand Dairyfarm Mortgage Company, Limited, has during it, financial year ended March 31 last, ad i vanced on first mortgages on freeholi a sum of £100,511 7s Id. The tota area covered by the mortgages is ap proximately 1 1,000 acres, of whicl over 10,000 acres is in suitable dairy ing grass land carrying approximate!; j 7000 grown cattle. The averag mortgage per acre is just over £l4. “As has been stated before the company is a trustee ono and there fore must follow the provisions o Trustee Investments, and Iho company lias conceived as its paramoun duly the safety of investment, particularly as tlic rate of interest is lon and consequently the profit margin o: I interest is small. The company is b> law required to collect from borrow- | ers 2 per cent, of the amount of the loan granted and place same to ? special reserve fund for a specia protection of debenture-holders l ills fund, which must be invested in Government or local bodj securities, exceeded £3OOO for the year under review. The annual accounts of the Dairyfarm Mortgage Company, cover a period in excess of ! 12 months as far as expenditure is j concerned, but only nine months as j regards income. Its second year of ' operations which will be reviewed at | our next annual meeting, will give a j better idea of Hie working of the comj puny, but I am satisfied, from its initial workings that this company will be a great service to the suppliers of the New Zealand Co-operative Dairy Company, Limited. Employees’ Superannuation Fund. “ The investments of the Employees’ j Superannuation Fund of the company, j as at the end of its financial vear (Mav I 31, 1937) totalled £1 I 5,2 if*' 5s 2d. of | which £82.556 10s 8d is invested on j land mortgages from suppliers of tho | company, thereby not only providing j Ihe fund with satisfactory trustee ini' vestments bill ;iI Iho same lime being j of material assistance to suppliers of | the company.” (he chairman added. I ” I Miring I lie year under review api proximately £14,000 was invested by way of fresh mortgages. "II will be seen, therefore, that the total investments of the New Zealand Dairy Finance Company. Limited, the New Zealand Dairyfarm Mortgago Company. Limited, and the Employees’ Sn; ernnmiaDon Fund, for Die past'year total £295,500. and Die present outstanding balances in connection with Hie three funds as at the end of their respect i\ e financial years total over £350.000. ii will be seen, therefore, that these funds render a very real service In our suppliers. lie fore concluding my remarks on finance generally | would like lo say that, it is unfortunately true that in good times financial assistance is forthcoming without dirtlrully, but when money is most needed during lent times it Is almost impossible to re finance. It appears to mo only logical that in good limes borrowers concentrate on repayment of financial institutions would not. bo so hesitant In granting assistance when it noticed a tendency in lending mslihY tion- to lend a very high perrenhnro ' '• ■ LMy, |.i , , ,-|i, , \\y rate and lln.se who' have arranged I long - J

•• We do not think, however, the ability to obtain substantial loans on soeuril'ps which, in normal stale of the llnan.’e market, wouhl not support siirti high loans, is any ultimate benefit to the farmer. I strongly urge, therefore, that our suppliers oonecntr.lie on repayments of liabilities on lain! and stuck during tliis season and generally put their financial houses in order before the day of reckoning comes," commented .Mr .McKenzie. Excess Butter Shares. "To place all suppliers on an eiptal share basis your directors have derided ] that on application surplus shares arising from the alteration of the I share basis be resumed on Hie normal ] resumption value, payment |o be made | one-hall' in lireember, I*l ;tT. and the , balance in bereniber. I'.ldN. the re- | sumption to be based on the supply ill the | «»;n;-37 season, provided that t any increase in supply in the I'.K'T- i etilaling Hie final payment to be made , ill Meeeuibec. I‘.MS. Tlie re.ison for , spreading the resumption over Iwo > season:- is that under Hie hairy In re-iimi a! any on- lime. In addda.ii ! j sibly, if all the butter shares were *