REDUCE PRICE.

Auckland Star, Volume LXXI, Issue 77, 1 April 1940, Page 8

REDUCE PRICE.

BUTTER IN BRITAIN.

PRODUCERS* CONCERN

ACCUMULATION IN STOCKS. HEAVY DROP IN DEMAND. Representatives of the dairying industry in Auckland take a serious view of the accumulation of butter t-torks in Britain under Government control, and it ift considered that immediate representations pliould l>o made by the Australian and New Zealand Governments to the British authorities to discard rationing and reduce prices to a level which will restore consumption.

"Tt is a matter for Government*, not commercial interest*, to deal with." said a leading member of the industry thi* morning. "The only solution appears to lie the abolition of pooled marketing and rationing to place the butter trade on equal competitive terms with margarine. At the present time margarine i& making heavy inroadts into the butter market, and already great harm has been done."

Imports of butter into Britain had fallen liy 20 to 2."> per cent, as compared with the pre-war position, it wae stated, while consumption in Britain had l>een halved. The deliveries from Australia and New Zealand showed an enormous increase on those at the l>eginning of the last war, and there were also large .supplies reaching Britain from Denmark, Holland and other part* of Kurope.

Rationing, i-nupled with the increase made in the price following the outbreak of the war. had deaTt a drastic blow at consumption, and the butter market was left defenceless against the challenge immediately launched by the margarine trade. Profit Margins Raised. The margins on wholesale and retail soles of butter in Britain had been increased, it wa* explained, to an extent which raised tiie price to the consumer hy about 2d lb. the increase in the wholesale margin beiiii; 3/ a cwt, which raised tho figure frou; 4/ to 11, and tlio increase in the retail margin being an average of Hd lb, which raised the figure to 3d. Against those increases there had ■been a fractional reduction in the amount allowed to importers, which was now 2 jK?r cent up to a maximum price of 125/ per cwt. A further Id ]>er lb had been added to tlio retail price to cover tho loss on Continental butters bought above the present market level and to meet the administrative charges of the Ministry of Food. Thus, but tor which on pre-war distributive margins would be selling at 1/4 per M> was being retailed at 1/7. The price of New Zealand butter landed in Britun was to-day 12e/, against 150/ for Danish and 140/ for Dutch.

Only one brand, a national brand, ■was now permitted in the sale of butter in Britain, it was stated. Thk had made it impossible for individual countries to push thj sale of butter on Mie British market, and nothing could be dine to meet the margarine campaign, which had been intensive and very serious in its consequenoe-s. Restore Competitive Marketing. In February, it was further explained, tho butter ration in Britain vas raised from 4oz to Goz a week, and within the past fortnight there had been a further increase to Soz. These changes, however, were unlikely to restore the market to a hoalthy condition, as high grade, margarine fit Sd lb had now secured a firm hold. In the opinion of experts, only :i sllWtiluiial reduction in tho price of butler could win back the consuming public, and at the ;-aine timo marketing initiative must be restored by permitting the use of competitive brands. "A >bi:r loss may have to be faced by the British Ccvernment to get consumption going again. l>ut there is no other solution to repair the damage done," wa* the comment of one authorit v.