BRITISH IMPORTS

Waikato Times, Volume 127, Issue 21193, 16 August 1940, Page 10

BRITISH IMPORTS

EFFECT OF THE WAR PRODUCE FROM DOMINION NOW LARGEST SUPPLIER "It has been impossible to obtain anything like reliable information regarding imports of dairy produce Into the United Kingdom during the year ended June 30. 1940,” said Mr W. Goodfellow, managing-director of Amalgamated Dairies Limited, “but estimates have been supplied by our London office for the 1940-41 season as follows:—Butter, 260,000 tons against 472,000 tons in 1938-39, a decrease of 212.000 tons. Cheese, 155,000 tons compared with 149,000 tons, an increase of 6000 tons. “Our European competitors are now all off the United Kingdom market,” said Mr Goodfellow, “and New Zealand is at present by far the largest supplier of dairy produce. Growth of Industry “The growth of the dairy industry in New Zealand has been phenomenal during the past 25 years. The United Kingdom’s imports from New* Zealand in 1913 were 12,600 tons of butter compared with 129,100 tons in 1938, and 27,350 tons of cheese compared with 81,950 tons in 1938. In 1913 New’ Zealand supplied 24 per cent of the cheese imports against 56 per cent in 1938. Canada supplied 56 per cent of the imports in 1913 and 23 per cent of the imports in 1938. As to butter imports Empire countries supplied 20 per cent in 1913 and 501 per cent in 1938, New Zealand supplied six per cent in 1913 and 27 per cent in 1938, Denmark supplied 41 per cent in 1913 and 25 per cent in 1938, Australia supplied 14 \ per cent in 1913 and 19 per cent in 1938. Lower Consumption “Owing to the rationing of butter in Great Britain, and the loss of Continental supplies, consumption has decreased substantially since the war broke out. The demand for margarine, on the other hand, has shown a corresponding expansion. The approximate consumption of rationed butter and margarine a , head in the United Kingdom has recently been as follows:—1940: Butter, 121 b; margarine, 201 b; a total of 321 b a head. In 1938 the consumption was:—Butter, 241 b; margarine, 101 b; a total of 341 b a head. “The present ration was six ounces either of butter or margarine a week, and two ounces of margarine or cooking fat a week. Therefore, the ration is eight ounces butter and margarine a week or 261 b a head a year, compared with 341 b a head in 1938. Last Season’s Pric* “Australia has accepted the British Government’s offer of renewal of its contract for another year, for the sale of butter and cheese, at the same price as last season. We can reasonably assume, therefore, that New Zealand and other Empire countries will also agree to sell the coming season’s exports at last season’s prices. “In view of the very critical state of Europe, we in New Zealand are extremely fortunate that the British Government is willing to continue to purchase our produce on a cash f.o.b. basis, and thus take all the risk of transport.” Shipping Freights Mr Goodfellow quoted the following figures showing the rise in shipping freights since the outbreak of war (shown in New Zealand currency) : Pre-war Present Butter .. 7/4 cwt. 12/6 CWt. Cheese .. 7/5 cwt. 13/1 cwt. Skim milk powder . £?/7/6 ton £7/16/3 ton Evaporated miik .. 1/9 case 3/9 case “This increase in freights is not for the benefit of the shipping companies,” said Mr Goodfellow, “but is applied by the Ministry of Shipping to replace ships lost by enemy action. Therefore, all shipping losses or profits are now on account of the British Government. Australia’s Advantage “It should be pointed out that the New Zealand farmer is seriously handicapped when competing with his Australian rival. For instance, Australian butter is worth on the London market 2s a cwt less than New Zealand, but under the Australian Equalisation Plan the payment for all butterfat in Australia is increased considerably over the export parity. Therefore, the Australian factory receives a higher price than the New Zealand factory. “Furthermore, farm labour costs a good deal less in Australia. High Production Cost “The high cost of production in New Zealand is unsatisfactory when it is realised that the prosperity of this country depends very largely on the export value of its primary products. “Only 18 per cent of the butter and five per cent of the cheese produced is consumed in New Zealand. Therefore 82 per cent of the butter and 95 per cent of the cheese produced is exported, almost exclusively to the United Kihgdom as there is no other market for this quantity. “It cannot be too strongly emphasised that, sooner or later, New Zealand produce will once again have to sell in competition with the produce of other countries in the world’s markets. Our people will be welladvised to prepare now, while prices are comparatively good, for considerably lower values when the war is over. World prices will fall as the expenditure of capital is curtailed, and butter prices will also have to be reduced substantially to meet margarine competition.