H—3o

The War Office was approached at the instigation of the New Zealand millers, but it is unlikely that further orders will be placed in New Zealand. Bacon Subsidy.—The administration and payment of the subsidy payable in respect of bacon was another function assumed from the Food Controller's Office. The payment of this was continued until the 30th September when the subsidy was withdrawn,, Agar Agar.—Before the war agar was imported, but local sources of supply are now being used as far as possible, thus effecting a saving in overseas exchange while providing a valuable source of income to part-time collectors, primarily Maoris. The "Department continued to act as the sole collecting agency, and all agar purchased was sold to the Davis Gelatine Co. of Christchurch. The price of Is. per pound was maintained, but certain freight-allowance adjustments were introduced during the year. In general, there has been a slackening off in supplies coming forward, and the whole of the collection and availability of this weed is to be the matter of a special investigation later this year. There is a possibility that many of the beds may have been subjected to over-picking. If this is the case, some measure of protection may have to be adopted to prevent damage to the industry. Local Meat.—During the year the Department was charged with the responsibility of ensuring that during the period when price controls on meat sold locally were not operating ample supplies of good-quality frozen meat would be available on demand to the public at fixed prices. In the North Island fresh meat supplies were generally adequate to meet the demand, and this meant that fat-stock prices did not rise excessively during the decontrol period. When any sharp rise was experienced frozen meat was used, and this had a steadying influence on market values. The position in the South Island was, however, rather different. The Canterbury area, owing to a very favourable season, had a steady supply of meat, but prices rose well above those ruling in the North Island. This was due to the reluctance of the Canterbury wholesale and retail trade to use a proportion of frozen meat. In the Dunedin area the supply of fresh meat was inadequate to meet the demand, and, consequently, fat-stock prices rose to a very high level. The availability of fresh meat for this market is limited for the June-November period and the only alternative appears to lie in the wider use of frozen meat. Good-quality frozen ox-beef is not usually held in stock in Dunedin, and if it is to be made available to the public it must be transferred. The Department did transfer on behalf of the Dunedin trade a small quantity of frozen beef from Southland, and this was favourably received. It is expected that the supply of fresh meat to the local market in the South Island will steadily decrease in the future, and therefore increasing quantities of frozen meat may be required to meet the position. The Department wishes to express its appreciation of the co-operation given to it by the New Zealand Meat Producers' Board, the Freezing Companies' Association, and the Master Butchers' Federation in dealing with local market meat problems. MILK DIVISION National Milk Scheme The milk year commences on the Ist September and finishes on the 31st August. The Department continued to operate the National Milk Scheme which first came into operation during the 1944-45 year, and this year therefore represents the fifth year of its operation. The scheme aims to ensure an adequate supply of good-quality milk all

21