EXPORT OF BUTTER

Ashburton Guardian, Volume 54, Issue 149, 6 April 1934, Page 7

EXPORT OF BUTTER

MR GOODFELLOW’S PLAN.

LOWER SUBSIDY AND LOWER EXCHANGE,

(Special to the “ Guardian.”) AUCKLAND, April 5.

A review of the dairy quota discussions, in the course of which he criticised certain, politicians, was made to-day by Mr' William Goodfellow, who then advanced specific proposals for remedying the state of the industry. Mr Goodfellow said that the recent panic policy of' New Zealand’s political leaders was to be deplored, though in justice to Mr Forbes, it should be said that he obviously 'was never keen on the restriction of the Dominion’s exports. Mr Coates, on the other hand, had for some time past been obsessed with the need for planning everything and the dairy industry appeared at present to be his particular hobby. Mi Masters could be relied upon to advocate whatever best suited secondary industries. It was questionable whether either gentleman had ever given the question of dairy export restriction serious thought. Mr Goodfellow traversed the quota discussions with Britain and the Dairy Conference. He said that on Maich M and 23 the Dairy Board met the Government and, contrary to the Boaid s declared policy, and one could only assume under extreme political pressure, finally agreed to a delegation being sent to London headed by a Minister and with power to act. This meant that the Dairy Board had placed the industry in the hands of a jnembei o the Government with power to entei into an agreement to restrict dairy exports. , , The Dairy Board was requested to meet the Government again on April 11 to present and discuss a restriction scheme, which would form a basis foi discussions at an Empire conference in London. Latest reports, however, were that Britain had again intimated that she did not desire a conference. The dairy farmers of New Zealand would be exceedingly relieved to know that.

Effect of High Exchange. Discussing likely developments aftei the expiration of the Ottawa Agreement, Mr Goodfellow expressed disagreement with the view that Britain would not make a separate trade agreement with New Zealand. It was quite conceivable, he said, that the Britis import tariff would be based on tlie results of the operation of L the Ottawa i Agreement. If so, New. Zealand would not make a very satisfactory showing. The small tariff concession had been more than neutralised by the increased exchange rate with the result that the British manufacturer was now worse off than before Ottawa. 'New Zealand had shown, an almost callous disregard for her only worth - while customer. There was yet time, but not very much time, to put matters right. Mr Goodfellow said that no one could tell how much longer the present economic blizzard would last. Now Zealand should therefore prepare for the worst and not continue to hope for the best. When European conditions improved, New Zealand would once again have no difficulty in selling dairy produce, provided the qualityand' costs were competitive. > Ten Points. He suggested the following propositions for the Government’s consideration :

1. National economy, including a 50 per cent, reduction in the size of Parliament. 2. Deduced tariff and rates. 3. Bring exchange hack to par with sterling. 4. Replace the exchange premium with a temporary subsidy. 5. Encourage dairy farmers to breed pigs, ewes and poultry. 6. Maintain the quality of dairy produce. 7. Reorganise the Dairy Board. 8. Actively push sales in all new markets. 9. Establish three central patting plants in the United Kingdom. TO. Push and advertise Fernleaf pat butter throughout Britain. Reduction of. Costs.

“First of all,” said Mr Goodfellow in amplifying his proposals, “all internal costs must come down. This Is a matter of paramount importance in a producing country, selling the major portion of its production on the world’s markets. Goods of all descriptions other than food are far too dear and are restricting buying power. Farmers carried the high tariff on their backs when prices were good, but now they can do so no longer. The tariff should be completely removed forthwith from all those British goods which do not compete with local industries. That would promptly reduce the cost of living to the whole community. Therethe Tariff Commission’s report should be dealt with and put into operation as soon as possible.” The United Kingdom was New Zealand’s only big market and the Dominion should aim at a permanent policy to keep the exchange on parity with sterling. - Until the tariff has been substantially reduced and some improvement had taken place in the world’s markets, the dairy farmer should receive a subsidy to enable him to cari’y on. The British Government had established a precedent in that respect. Therefore, there could now be no objection from that quarter. The Government, by propaganda, should recommend dairy farmers to go in for diveisified farming. Blitter in Pats.

Mr Goodfellow dwelt especially upon liis proposal for marketing butter m pats. He said that practically . the whole of New Zealand, Australian and Argentine butters shipped to . the United Kingdom were sold in bulk, which made substitution extremely easy. Further, it was almost impos sibl'e satisfactorily to advertise and push a bulk line as there was no guarantee that the customer received what he asked for. Then again, the pat-

ting of such butter in the United Kingdom overcame the spreadability difficulty.

The Dairy, Board should begin by at once establishing three large plants in London, Manchester and Glasgow and gradually increase the trade until the bulk of New Zealand butter was sold in pats. It would be advisable to employ about fifty travellers and, spend anything from £75,000 to £IOO,OOO yearly on publicity in the United Kingdom. In addition, the board should employ travellers at Hong Kong, Montreal, Panama, and one fox: the Mediterranean to develop new markets.

The scheme would cost money which could easily be found by the imposition of a marketing levy on all dairy factories of one penny per lb on all local sales of butter and a half-penny on cheese. By: that means the board would collect say £250,000 yearly without cost to the dairy farmer. Based on Experience. Mr Goodfellow said he had given this scheme a good deal of thought and as it' is based on his own experience in marketing the produce of the New Zealand Co-operative Dairy Company for many years, lie was certain it would mean an increased return to the whole of the dairy farmers of the Dominion and without any additional cost to them whatever. In conclusion, Mr Goodfellow stated that there was in reality no overproduction ,of dairy produce, but ratliei under-consumption, especially in Europe. Sooner or later, the financial hurricane would pass and once again closed markets would gradually reopen. New Zealand should he equipped to he called upon to supply all the high-grade butter and lamb that she is capable of producing, as in the production of these two products, the climate excelled all others. “Let us then set our house in order now so as not only to weather the storm, hut to .profit to the full, when the world outlook is brighter,” ho said.

FARMERS’ COMMITTEE REPORTS

1 A BOUNTY RECOMMENDED. (Per Press Association). HAWERA, April 5. A report presented to-day bv the sub-committee which was appointed last night by the South Taranaki executive of the New Zealand 1 armors Union to make suggestions for Improvements in the dairy industry urged that full investigation be given to the adoption of some scheme of bounty for dairy produce, to operate along the lines of the Patterson scheme. It was felt that an export bounty on a sliding scale of value would" be preferable to the present exchange. , , ~, It was recommended also- that no rural mortgages be permitted for a period shorter than 20 years, and that an amortisation scheme be arranged so that mortgagees be paid off during the period, and where possible all current rural mortgages be so converted. Such amortisation fund was to be based on the excess of butter-fat over .what might be taken as an index figure necessary to provide an economic return. • i In regard to rents, it was considered that land should he leased on a given number of pounds of butter, irrespective of the price paid by the factory. BERNARD SHAW’S ADVICE. BLENHEIM, April 5. Asked if be bad any suggestions to offer as to how New Zealand could pay her way if (to use his own words) she ceased ramming her butter down unwilling .throats overseas, Mr George Bernard Shaw suggested that New Zealand should drop butter and concentrate on producing something that other nations wanted but could not produce. “As far as I can make out up to the present,” lie said, “you have discovered nothing except Maori gate-posts, for which there" is not a very large demand.”