LAMB PRICE REDUCTION

Press, Volume CI, Issue 29818, 10 May 1962, Page 10

LAMB PRICE REDUCTION

Use Of Capital Reserves

Lamb prices dropped below floor prices for the second time in three seasons, and advances from the meat industry’s capital reserves would be necessary, said Mr R. E. Hiatt, chairman of the meat and wool section of North Canterbury Federated Farmers, in his report to the section's annual conference yesterday. Two years ago the market recovered from low prices, and only £933,573 was required. he said. This was paid from interest on the meat industry reserve account. But this year the capital would have to be used “We do not wish to see these reserves depleted to such a low margin that they are in danger of being elimin. ated. I know some farmers would like to have this money come back into their hands. But. as long as we can maintain the reserve capital at a reasonable level the industry will be assured of reasonable stability, although it may be at a lower level. "There are some farmers who want a higher floor price. I would say that it must come down gradually in line with overseas markets,” said Mr Hiatt. Any move to hold the present level permanently, or to increase it to a fictitious level would be wrong, he said.

If the dairy industry had used its funds more as a cushioning medium during the period of falling prices instead of holding the payout at a higher level, the industry. as well as the country. would be in a happier position today.