DAIRY PRICES.

Auckland Star, Volume LXVII, Issue 167, 16 July 1936, Page 10

DAIRY PRICES.

UNFAIR SYSTEM,

DIFFERENTIAL RATES.

A. AND P. CRITICISM.

A strong protest against the action of the Government in aopting a scale of differential, prices for butter and cheese was made by Mr. S. Austin Carr, president of the Auckland Agricultural and Pastoral Association, when presenting the cups and trophies won by Auckland dairy factory companies at the Wintev Exhibition last evening. Mr. Carr

maintained that the system would be unfair in practice and most inequitable in its operation and final effect. He would "be failing in his duty as a dairy farmer, he said, addressing his remarks particularly to dairy factory managers, if lie did not express his concern at the differential payments it was proposed to make in the future. •

Companies in the Auckland Province, said Mr. Carr, had proved by results and comparisons that;' although their produce might be graded slightly under 94 points 011 the season's average, they had been able to secure a price equal to or better than tliaf obtained by a factory grading slightly higher, by the manufacture of a class of butter that the buyer wanted. These factories had been able to treat their suppliers better by reason of their lower manufacturing cost?, but they were now threatened with the loss of the advantages secured for them by progressive methods. Mr. Carr added that all were alarmed over the suggestion that a system of five grades -would be used in butter for the purpose of quality premiums, through general regulations in connection with the guaranteed price proposals of the Government. While no one was certain concerning the possibility of this proposal being adopted by. the Government, all farmers should protest strongly against the suggestion. A Suggested Alternative. The fact that Taranaki, Wellington and South Island factories were generally obtaining the highest points, thus placing them in a higher position than the average Auckland factories as far as grading, l classifications and percentages of output were concerned, had been shown in evidence submitted by the dairy producers to the Royal Commission in 1934. "From this. it follows that any system of premium awards, set -up upon a Dominion pool basis, would be inequitable," said Mr. Carr. "Factories in .areas in which a reasonable percentage of this No. 1 grade cannot at present be obtained would necessarily be mulcted in the whole of the premium payable in the more favoured areas. A more equitable scheme and one which would be productive of more good would be to base the payments on average grades which are actually ! available at present in each province.

"The effort and service needed, and the co!t- involved in effecting improvement;. of abutter quality, particularly, are both infinitely greater in, for example, the Waika'to, than in the Wellington Province, and under Government control we are- told that it is effort and service which should be given ' the highest awards. It would therefore be doubly inequitable to /subsidise the more favoured Southern factories, at the expense of the Northern factories." More Expenditure for Factories. Mr. Carr pointed out that it was doubtful whether any factory was designed or equipped to segregate five grades of cream for separate processing, holding, churning, and butter packing. Extensions and alterations would probably be quite, out'of proportion „to any likely extra return, and the proposal was, therefore, uneconomic.

"From the marketing point of view British merchants have pointed out on a number of occasions in the. past that our present system of grading butter into three grades is commercially unsound," said Mr. Carr. "So far as the great bulk of ordinary consumers is concerned, the. difference .bpt\yeen finestand good first grade is seldom noted, both butters usually being .retailed at the one price, and the retailer profiting by the lower return- made to factories for produce stamped - first grade. It is, therefore, greatly desired that whatever distinctions may be made in the payments for butter, no additions should be , made to the three, grade stamps now in use;"