BUTTER DUMPING IN BRITAIN

Press, Volume XCVII, Issue 28559, 12 April 1958, Page 14

BUTTER DUMPING IN BRITAIN

Effect On N.Z. Surveyed (New Zealand Press Association) NEW PLYMOUTH, April 11. It was surely unthinkable that Britain, even at the late stage when New Zealand had lost a big part of its dairy industry reserves through Britain’s inaction against dumping, would not do something to. right a serious and flagrant wrong, said Mr A. Linton, chairman of the New Zealand Dairy Board today. Mr Linton was speaking to Taranaki dairy company directors at the Stratford ward conference of the board, and surveyed the effects on New Zealand of the dumping of butter on the British market. He said that unless action was taken soon, New Zealand’s only recourse would be to begin bilateral trading, exchanging butter for motor-cars and bther goods from European countries.

In April, 1957, when the previous Minister of Agriculture (Mr Holyoake), led a trade delegation to the United Kingdom, concern had been expressed at the position that was developing, Mr Linton said. The attention of the United Kingdom Government was then drawn to the unfair position in which Denmark and New Zealand were being placed through the dumping of butter by foreign countries. The matter was raised again strongly at the time of the November talks, in which Mr Linton took part At that time, the English and Scottish Milk Marketing Boards had offered their support for the case against the dumping of butter. A case had been submitted on February 17, and since then, Denmark, as a traditional supplier 1 to the United Kingdom market, had indicated that she supported New Zealand’s complaints. It was obvious that after the British Board of Trade had adjudicated on the case it would go to top political level for final decision, he said. The industry had pressed strongly for the DeputyPrime Minister (Mr Skinner) to go to Britain, and was pleased that the Government had agreed. Price Drop In the last two years the price of New Zealand butter had fallen from 350 s—or slightly more than the guaranteed price—and over the last nine months from 3205t0 to 206 s—the “catastrophic level ruling today,” Mr Linton said. Noone could say whether rock bottom had been reached.

“If this was due to world-wide over-supply, we could not complain,” he said. “But it results only from a flagrant and deliberate dumping policy, carried out by various European countries. These countries follow a policy of selling butter to their own people at artifiically high prices and then they dump the rest on the world’s only open market, the United Kingdom. “The situation we face today is one which has never previously arisen and it is no fault of ours It is simply grotesque and an absolute travesty on fair trading. Although we sometimes think our costs are high, the fact remains that we can still produce butter more cheaply than any other country. That is something which wants to be said again and again in connexion with our present troubles. Far too many people in New Zealand seem to think that we want unreasonably high prices in the United Kingdom. We don’t. We can sell our butter at shillings less a pound than most European people are paying, and still make a living here. But what we cannot do, is to compete with foreign governments who let their own people pay up to 6s per lb for butter, and are content to dump thousands of tons of it into Britain for about a third that price. “Our Government should not mince words with the United Kingdom Government on this issue, for if the anti-dumping case fails, and if the British Government allows unrestricted dumping to continue on the present ever-growing scale, there is no hope whatever of receiving reasonable returns for the butter we sell in the United Kingdom,” he continued. To talk of Empire preference, while the present situation continues, is simply playing with words. “Cold Indifference” What had angered New Zealanders generally, and not just dairyfarmers, was the cold indifference. and near-hostility with ' which New Zealand’s claims had been received in some quarters in the United Kingdom, Mr Linton said.

He considered that the Deputy High Commissioner for the United Kingdom (Mr D. M. Cleary) was wrong when he suggested that New Zealand’s complaint was against foreign countries and not against the United Kingdom Government. “The foreigners are entitled to get away with it if they can,” Mr Linton said. “What people in New Zealand resent is that nothing whatever has been done by the United Kingdom to prevent the situation that has now arisen and which has cost us millions of pounds. We have simply been treated as any small foreign country might be that was raising some awkward question. “We have got to make the people of New Zealand as a whole completely aware of what is happening—and make them realise—as I don’t think they do as yet—that the standard of living of everyone in this country will be seriously affected, if the present situation continues,’’ Mr Linton said. “We must somehow make them understand that our industry can meet any competition and undersell any European country on a fair trading basis. And it can do that while still selling butter to the people of the United Kingdom at a fair, but not a ruinous price.” Appeal to Unions He had been pleased to see that Mr F. P. Walsh, president of the Federation of Labour, had made a strong appeal to British labour to stand behind a Commonwealth country in its difficulties, and not to be led astray by those who said that the imposition of antidumping duties would sacrifice

the cheap breakfast table in the United Kingdom. “The real issue—and it affects every man, woman and child in this country—is that no industry can stand up for long against Gov-ernment-subsidised trading. While the people of Europe are deprived of butter because of the high price demanded in their own countries, that same butter—thousands of tons of it—is flooding the United Kingdom market. If, by some miracle, dumping were stopped tomorrow, within a very short time our market prices would rise to reasonable levels. And that would happen without hardships to the people in Britain who would still be paying shillings less a pound than the people of several European countries.” Increased Dumping Quantities of butter going forward from Finland and Sweden had increased. Reports from London indicated that substantial increases were expected from the dumping countries this year, and even last year, when the situation was not so serious, 60,000 tons flowed into Britain from the dumping countries. To worsen the situation other countries had begun sending in supplies. While Poland was getting handouts of surplus dairy produce from the United States, she was actually shipping Polish butter to Britain. Because it was practically impossible to get accurate information of the real price of butter in the Iron Curtain countries, New Zealand probably could not prove a dumping case against Poland. Information was that butter sold there at more than 10s per lb, and the ordinary people there certainly could not afford butter at that price. Hungary was also in the field. Uruguay was andther cquntry which, for the first time, was shipping butter to the United Kingdom, and France and Austria had also sent forward quantities. “We would have no quarrel with these countries if their own butter was available to their own people at the price they are accepting in the United Kingdom.

Depleted Reserves “Because of dumping—and only because of dumping—the end of our industry reserves is in sight.” he said. “I feel strongly that we have had less than justice from the United Kingdom. When the war was over and Britain was hard pushed, and when butter was selling at very high prices throughout Europe, we had the chance to cash in on the European market. Britain asked for our help. What did we do? We didn’t find a hundred different reasons why it was difficult for us to sell her butter at a much lower price than we could have obtained in Europe. We voluntarily continued rationing here in New Zealand so that we could send her additional quantities, and we sold her that butter at 80s less than we could have obtained in Europe.

“Today the situation is reversed. We are in difficulties because Britain is accepting large quantities of butter from Europe —some from former enemy countries—at prices that bear no relationship with what the people of those countries themselves are paying for the same better. “The time has come for us to let the United Kingdom Government know definitely that if action is not taken soon our only recourse will be to start bilateral trading, exchanging butter for motor-cars and other goods from European countries. I believe there are some who would welcome the opportunity to trade on this basis, but we must not deceive ourselves. Once we start on this road it is the beginning of the end of Commonwealth trading relationships as we have known them.

“Those of us who have strongly supported the policy of trading freely with Great Britain will regret the change. It is not one of our own choosing, but may be forced upon us through the United Kingdom Government’s inaction,” he said.