THE BUTTER INDUSTRY.

Auckland Star, Volume XXVI, Issue 181, 31 July 1895, Page 4

THE BUTTER INDUSTRY.

The, farmerß of Waikato are greafcly concerned with regard to the prospects of the butter industry during the .approaching season. .Towards the;close of laßd season they made a concession upon their contracts with Meßßrs Reynolds and Co. which broughb dbjvn their milt a;,figure that could hardly be regarded as remunerative, They lived; however, in the hope: of: better, times. V These aeem ob far away as ever. The terms; offered for v the season/; are equivalent>'to 2sd per gallon of standard milk,: provided that the* price in London i? 100s per cwb—a higher or lower price to be'paicl if butter risei above: that rale or falls bolo'wit. ' * ■ '■-■' .*<■ :;: - The farmers are naturally very much' dis. satisfied "with "these 'proposals:■'An assured rate Of 2id peß gallon for lifat-class milk is a - very^ low prices' It >was this cbnsiderationswhich indutted ivtr Spraggi manager. pi fch'o Jfew: Zealand Dairy Association to resolve upon^offeririg ;2^d definitely,;and take the - risk of- profit "to his coropTwy. _ Of; course, *- the■"'*low >*ange ,->bf;• . prices last season'cannot 'be * gainsaid ;;- ab .the. same-time.th 6 'milk suppliers of Waikato behaved- very-1 generously in abating the terms secured vto ■-■ ;them-' under: their contracts 'with Messrs; Reynolds-and'-CJo; Upon th'e.rßimple of^the company: that in'a fall in -prices justified such a reductioni'and this-fact' ought to be borne in mind noSw* ',;.' '-;K*"> -?;• v■:

"The sliding 'scale proposed;';' is open* to agood manyobjectionß.'lb not onlyleaves the farmer in great uncertainty as-to what lie' is izoing to get for, his.'milk,; but it virtually throws upon him the chief risk of thebusiness,'while : it gives him'no voice at a'l in its management. ;:The. Company mig 'h) nob adopt the. best'i'means of placing tlve: butter in' tlie markeb'in firstclasß condition; and a low price be tho result of euchrieglieencei and yet its profit would be ensured," abtbe expense of the farmer. Wo do nob : suggest: that this' is likely to happen, \ for it- may be -that every diligence will be ;used in maintaining both quality and •price oh the highest possible level, but tho lact remains that!; the; farmer would be made 'responsible" for the efficient management' of the business without'poesessing any voice in its contro|l If the farmer is really to be made a virtual partner in the concern,' and the^partner upon whom the chief risk of loss rests, then he should clearly have all the privileges of a shareholder. Ke should receive representation .on1 the board of managemenb,; with ■ dvQrsighc of .the accounts, and ba-t able to himself that everything iwhich could be done was done to safeguard his interests and place his products in London to the best advantage. ;■■''>'■

Objection has been taken in Waikato to the istandard of iOCs fixed to ensure the ' paymenb of 2Jd per gallon.- It "is con- i tended that the margin of,nearly 4|d per Ib betwoen the price paid to the farmer and "the selling" price in London is too high to cover the cost of manufacture, i shipment, ,antl -. 8$Je< . Without more detailed- information than has been furnished'we are not in a'position to discuss lihis question, butSve observe that the .?• Waikato Times," using certain figures supplied them by Messrs Roynolds and Farley as a basis of calculation, estimates that the Company'n proposals for the coming eeason are equivalent to asking " 22s 4Jd per:cwt as protib to be guaranteed over and above all etfpensos." : This may or may not be :a fair deduction, bub in any case, we canwell understand'the wideepread discpntenbbhab prevails withi? the preaent pro• posals.' Possibly the hostility that is being manifested might "be met by a reductloh in the 'London rate? of'iOOsi rwhich is proposed as the basis on which 2^d per gallon may be expected forstandjyd milk. At one meeting in Waikato the Spier day 92s was" suggested as a rate • wnich the farmers. .might be prepared to accept, bub ib certainly appears to us that the real question at issue is whether''the farmers, are to become full partners in a co-operative dairy ' company or no 6. The chief.capital in such a concern ia undoubtedly represented by the lands, the cattle and ■■■< the' labour,, supplied by- the farmers, in comparison with which the creameries and labour, connected with, them is very small indeed. If the creameries are to be conducted a separate business venture, the course pursued by the Dairy Association in offeriDg , ft. fixed price of 2^d per - gallon, taking the risk or the London market 'themselves is clearly the proper business course. If on the other hand, .the • Business' of manufacture and sale is to be. made a co-operptive.enterprise, it is fair and reasonable that the farmers should be afforded the chance of managing the concern to their own advantage, either by acquiring the ;exlsbipg-creameries and conducting them as a cd-bperativ'e concern pure ~ and simple, jprfby^being granted representation on the fdi,cfect6rate.;proportionate to tho risk they have at stake, with a guarantee that all profits made in excess of a reasonable interest

■pn'the"capit»ra^ '3nf'" ness of manufacture and sale, shall be distributed in bonuses to the milk suppliers. We 'can easily: understand. ttfa't^therer'are practical difficulbies in the way of carrying oub -such 'an • arrarigemehb, /andg thabV>^a straignt-out guaranbeed price, eyea so low as 2^d per gallon for standard milk, would be simple^; and more acceptable to ' the farmers, bub ib is manitesb: thab if, againab .their will, bhey are compelled -to boar: the chief risks of the flucbuabjbns of; the ;L6ndon raarkfltv they;inay. fairly claim bhewHble, profib 'in excess of a fair r rabe of interest I apon the capital employed in manutacbure j and agency. ;; : '>. .. -:;" , .■; : ■■:';" ; Ib may be -thab> some other mode of adjustment will be'-arrived ab afber a conference between bhe suppliers and factory- ! 0wn0r3,% and., we: sincerely ;hope^thabi tho I existing; differences will; be amicably adjusted, .because; bhe prosperi by : of .the yvai;_ kato now depends to a very large extent; 'upon bhe dairy industry, .but ib is evidenb, from the : sbrpng feeliog.which,exists among bhVfarmers, bhab bhere is a serious danger, of complebeirupture if the presenb proposala, iwithoub'modifipation are insisted, up f on. .Wo. ;tjriißt that:*bpth sides will .approach ;bhe question in a conciliatory ißpirib.iand thab some compromise acceptable to all -'parties iwill be'arrived ab. ;