THE GUARANTEED PRICE

Press, Volume LXXIII, Issue 22240, 3 November 1937, Page 12

THE GUARANTEED PRICE

LAN AUSTRALIAN'S WARNING

Alteration Not Impossible

HIGH LEVEL IN LONDON

Stability Desired For Farmers

[From Our Parliamentary Reporter.J

WELLINGTON. November 2.

"If exceptional circumstances arise there is no reason why the guaranteed price for any particular dairy export season should be regarded as unalterable," said the Prime Minister (the Rt. Hon. M. J. Savage) in an interview this evening. Mr Savage was asked to comment c i the present price of 152s per cwt for New Zealand butter on the London market and to indicate how the Government viewed the discrepancy between this price and the new season's guarantee of 123s 3d. "There is no guarantee that the present London price will last indefinitely," Mr Savage said, "but there is a guarantee that, no matter how low the price of butter falls overseas, the farmer will still be entitled to 123s 3d in New Zealand for the current season. Naturally, we would like to see the current London price. maintained and the payment to the New Zealand farmer fixed in accordance with it. However, our aim is to provide stability for the farmer and we have to base our calculations on a whole season and not just on a period when high prices are ruling.

"Not Fixed and Unalterable"

"If the present prices hold for any length of time, and it is to be hoped that they will, we will be in a position to review the whole matter. If returns for the whole season were considerably in excess of the amount paid out under the guaranteed prices we would have to look at. the matter and see what could be done. There is no need to regard the guaranteed price as fixed and unalterable, although the farmer can rest assured that he will get that price, no matter, how far the market may fall." :

The only complaint about the rate of the guaranteed price in relation to present London prices had come not from New Zealand farmers but from an Australian merchant, Mr Savage said That Australian had been surprised that New Zealand dairy farmers r were not voicing heated protests. The trouble was that the Australian merchant might be competent to comment on the state of the dairy industry in Australia,- but he was certainly not competent to discuss conditions in New Zealand. The farmers of New land could turn arid say to their visitor that they had received last year something like £650.000 more for their butter arid cheese than it realised in London. The Australian dairy farmer could not say that. Everything pointed to the fact. that the farmers of the Dominion were far more concerned with the stability of prices than the sudden rise on the overseas market, rates which might or might not be maintained.

FARMERS* UNION APPRECIATIVE

PRICE TO NEW ZEALAND CONSUMER

(rBBSS ASSOCIATION TELEGRAM.)

WELLINGTON, November 2.

'Commenting on the remarks made last Saturday by Major J. R. King, of Sydney, chairman of directors of Empire Dairies, Ltd., about the guaranteed price for dairy produce, Mr A. P O'Shea, Dominion secretary of the New Zealand Farmers' Union, stated. to-day that the submissions of the New Zealand Farmers' Union had now received support from sn unbiased outsider, and Major. King had uttered a timely warning about "the high internal costs of New Zealand. Speaking of the high price at present ruling on the London market for butter, Mr O'Shea said that this price left no room for accusations that the dairy farmer was being assisted by the public of New Zealand. .On the contrary the public of New Zealand was receiving a very handsome subsidy from the dairy farmer because it was buying butter at a guaranteed price which ■was considerably below the world market price. It would be interesting to find what the dairy farmers of New Zealand had lost by supplying the local market at less than the world price. It should be emphasised also that on the present price it would not be very long before the overdraft remaining in the.Dairy Industry Account for last year was completely wiped out. . ■ . . The fact that butter was being sold in New Zealand at less than the London price also completely removad New Zealand from the reproach made by farmers in Great Britain that butter was being dumped on the London market at a price less than that charged in the country of production. This applied in the case of nearly all the larger suppliers of the London market except New Zealand. If the prices for butter in New Zealand were brought into li*>« with the prices obtaining in London at the present time, it would be costing about Is 6d in the shops of the Dominion to-day. Though ♦he price for butter sold in' New Zealand was lower then the London Srice, the dairy farmer .still had to jneet high production costs.