BUTTER MARKET.

Auckland Star, Volume LIV, Issue 95, 21 April 1923, Page 5

BUTTER MARKET.

TRADE 'WITH AUSTRAI-lA. A MERCHANT'S OPINIONS. A message from Wellington, published to-day, states that ir, view of the decline in prices of butter on the English market, local exporters were taking a special interest in Australian market conditions. Melbourne quotation., in, particular had shown a rapid advance. A recent rise of 0/ per cwt had brought the wholesale rate up to 224/ per ewt. or 2/ per lb. In Australia the production had fallen off so seriously that there was barely sufficient choice bvttter available for home needs, and Queensland was the only State with an oxportable surplus, but as there was gen-! erally a tendency to force prices unduly; highagainst the other States, some Vic-j torian buyers had patronised New- Zea-; land in preference to the north, and, business was believed' here to be cap-1 able of considerable expansion iinless.j as had happened before, Queensland j holders moderate their demands. 1 This was referred to a prominent 1 Auckland merchant this morning, who stated that since November last the whole of Australia had been suffering from a severe drought, and the position in some places was particularly serious. 1 Owing to the dry spell exports haiL fallen off almost 50 per cent for the season, and unless there was immediate relief it was certain that the supplies of butter would be far short of re-; quirements. In these circumstances, and j with the close approach of winter, there had been a fair amount of business done with New Zealand at "l/ 8 f.o.b. Owing,] however, to the decline of London values the position was a little easier, and bu.-i-j ness could be effected to-day at l/0_ f.o.b. for Australia. New Zealand fac-! Tories, however, viewed the present tte-| cline on the London market as of only a temporary character, and at the price offered by Australia very few were In-j clined to accept. Whether this optimism would be borne out by actual happening, on the London market within the ncxtj month or two remained to be seen. but| those who should be in a position to! gauge the prospects of London "futures" had purchased outputs in New ZealanrTj during February and the early part of March at 1/8 f.o.b. for March. April, and May. The optimism of dairy factories may yet prove not to be misplaced. It] was pointed out in a recent issue of; the "Star" that the market had made a recovery of 70/ a cwt or over 7d per lb, inside three weeks, and it required a lesser recovery to restore the position to that of last February. j Another point to he considered in con-| nection with trade during January was the unprecedented arrivals of butter in! Great Britain, totalling 2..,(100 tons. The! whole of this was consumed at 1/10 re-| tail, equal to 100/ to 105/ wholesale j "T Great Britain. The most remarkable! feature of the present position was that with prices now at a level that would enable the butter to be retailed at 1/0 per lb, the consumption had not been enormously increased. It was impossible to reconcile the heavy consumption in January at 1/10 and the slow consumption in April at 1/6. I The men who had bought at 105/ and 210/ were making a loss at the present time. They were forcing down the prices until they considered (he market had reached its lowest, and then they would purchase again. The moment they started to buy the immediate recovery of the market could be looked for. There was no necessity for undue pessimism at present.