The Press TUESDAY, AUGUST 27, 1940. Dairy Produce Agreement

Press, Volume LXXVI, Issue 23109, 27 August 1940, Page 6

The Press TUESDAY, AUGUST 27, 1940. Dairy Produce Agreement

The statement in which the Minister for Marketing has announced and reviewed the new agreement for the sale of New Zealand dairy produce to Great Britain reveals three changes, all to the Dominion’s advantage. First, although the British Ministry of Food adheres to its principle of contracting to purchase specific quantities, these are increased, by 5000 tons of butter and by 23,000 tons of cheese; and the Ministry also agrees that, if extra quantities can be made available and are needed, it will endeavour to ship them. Second, the agreement is now drawn to cover the period of the war and “ a subsequent period to be agreed on so that the dairy farmer is assured, as the woolgrower has been, that the transition from war to post-war industrial conditions will not be abrupt and unregulated. No doubt a similar provision will be inserted in the meat agreement. Third, the British Government has agreed to contribute towards additional storage costs, should the shipping schedule be interrupted; and this is an advance on the “ agreement in principle” previously secured. In these respects New Zealand’s position as a supplier is considerably strengthened; and the Marketing Department report of last year’s negotiations shows that the present results must be attributed to the Government’s consistent and fair representations, to which the Ministry of Food has fairly responded. Producer bodies have already credited the Government with good and hard work on their behalf; and credit is due. The Minister, however, claimed no praise. It should therefore perhaps be put down to an unlucky turn of phrase that he appeared to claim the virtue of restraint because the New Zealand Government “had “no desire in the existing circumstances to “exert pressure for increases on the figures “ arranged for last season’s butter and cheese.” The agreed- prices remain the same. But it is necessary to remember that the New Zealand Government has steadily represented to the British Government the need to open prices to revision as the rising cost of imports may unbalance them, not as the internal price level may have that effect. Mr Nash made no reference to import prices, which, according to the June figures, stand 14.3 per cent, above the level for August of last year. But upon the rise of over-all internal costs, which is continuous, no claim for higher contract prices could rightly be based, and it is no meritorious restraint to urge none. Yet here, undoubtedly, the Government is confronted by its .unsolved problem. So far, although the dairy season has opened, no statement upon the guaranteed price has been made. The present price was fixed in 1938. In December last the Minister faced a very angry and disturbed conference of ward delegates to the New Zealand Dairy Board, was told that the board found itself “ unable to satisfy the industry ” with the unaltered price, and was asked three searching questions. One was, how the farmer- was expected to meet the increased costs for 1939-40 out of a price fixed as “reasonable” for 193839. Another was whether the Government still regarded it as an “essential principle" of the guaranteed price scheme to enable the farmer to cover costs of production. Mr Nash has never answered these questions satisfactorily, although he has answered them at great length and with an ingenuity even greater; and they are now more pressing than ever. The recent decision of the Arbitration Cpurt sets them before the Government in a form that demands prompt attention and firm action. If the Government is going to allow prices to move up, with a momentum impossible to check, it cannot refuse the dairy farmer’s plea for protection. If it is going to check the movement and give the producer, stable conditions,' it will have to act soon and act vigorously.