SHARP RISE IN BUTTER.

Auckland Star, Volume LI, Issue 208, 31 August 1920, Page 5

SHARP RISE IN BUTTER.

PRICE OF 3/- PROBABLE. AFTER END OF SEPTEMBER. The price of butter on the local market is almost certain to be raised to the i neighbourhood of 3/ per pound after the j end of September, according to authori- i tative information supplied in answer to j a "Star" inquiry this morning. In effect, the informant stated that when the Premier, replying to a question in | the House a few days ago, said that he did not think the price of butter would . go as high as 2/9 per pound, Mt. Massey's statement was either unconsidered, or else it was the intention of the Government to again subsidise the local price of butter from the Consolidated Fund- It was practically certain that the Imperial Government would take our exportable surplus of butter at 2/6 per pound, f.0.b., and if the Government allowed the factories an unrestricted local market it would mean that the price of butter would be in the vicinity of 3/ per pound retail after the end of September, when stocks of last year's Imperial purchases would be consumed. Before the war the distributor was allowed one penny per pound over and . above the export f.o.b. price of butter for I preparing butter for the local market. This was now worth at least 50 per cent more owing to the increased cost of material used, as well as the increased cost of wages and cartage. In this allowance the distributor bad to provide for bad debts. Allowing that l_d per pound was a fair sufti to provide for distribution from wholesaler to retailer, the net price to the retailer would be 2/7 _ per pound. The Board of Trade 'had recognised that the retailer was entitled to lo per cent upon cost for again distributing to the consumer, and if 15 per cent was added to 2/7., it would be seen that, without restriction upon retail price, 3/ would be a fair figure to charge to the consumer upon an export selling price of 2/0 per pound, fob. The price of butter in Australia was reported to be 2/9 per pound, and that figure was based upon an export price of 240/ f.0.b., being less by more than 3d per pound to the export price of New Zealand butter. As the Imperial Government was increasing tbe price for export -butter to Australia to bring it upon a parity with the price to be paid to New Zealand, no doubt the retail price in Australia would be raised to 3/. It was quite evident that without a subsidy from the Consolidated Fund the price of butter in NewZealand must be higher than that indicated in the question asked Mr. Massey in the I/oiise last week. "The public," said the Informant, "have every reason to be thankful to the Government for their foresight in securing sufficient butter from Imperial stocks to supply the public with cheap butter for the last two months, and with sufficient still on hand to continue this another month. In this period approximately 2500 tons of cheap butter will have been consumed in New Zealand, which means a saving to the public at only 1/ per pound, of £280,000." The same gentleman further remarked that the Imperial offer will operate until March 31 next year, after which time an absolutely' free butter market will be I given. "