Over-Supply Of Butter Expected

Press, Volume CII, Issue 30210, 15 August 1963, Page 22

Over-Supply Of Butter Expected

(New Zealand Press Association) WELLINGTON, August 14. .Although there had been a shortage of butter in the United Kingdom market, there would be a corresponding over-supply in the remainder of the quota year, said a Dairy Board spokesman today.

The stand taken by the industry on the British quota rise was based on this, he said.

Of the 410,000 tons allocated for this year’s import quotas, only 89.000 tons had been supplied in the first three months, he said. “This is about 4000 tons less than in 1962 when quotas amounted to only 390.000 tons. “In other words, for the nine-month period from July 1 there will be 321.000 tons to come in, compared with 298,000 tons for the last nine months of the 1962-63 year. “The reason for the recent rise in the price of butter is thait during the first six months of this year imports into the United Kingdom were 18.000 tons fewer than in the same period the previous year and home production was 6000 tons lower. “However, New Zealand is convinced that the quotas will be filled by the end of March next year and this will mean that approximately 20.000 tons more butter will be imported than during the 12 months ended March, 1962.

“The British Government, however, decided to take immediate action and allow in an extra 5000 tons from Eire and 10.000 torts from Australia. For the first six months of 1963. about 8500 tons a week have been taken but. with quota supplies to come plus the extra allowed for, consumption would need to reach 9000 tons a week. There would still be Stocks of some 45.000 tons by March. 1964. Such a rate of consumption cannot be expected at present prices." he said. “However, it is believed that the recent, action taken by the United Kingdom is exceptional and for this year only, and as New Zealand has the right of consultation about quota arrangements before the start of the new quota year, it can hope to come to a better understanding with the United Kingdom Government by then," said the spokesman. New Zealand would be able to supply the additional 2000 tons of butter sought by Bri-

tain by the end of October, the general manager of the board (Mr A. H. Ward) said today. Britain "regretted” the difference of views with New Zealand over the new butter import quotas, authoritative British sources said, according to a cable message from London. But New Zealand’s views were considered nothing more than normal reaction to a commercial matter, they said. It was not felt the resulting additional imports would greatly undermine the stability of the market The quota system should prevent any serious price decline. The sources said Britain would have been glad to take more butter under the new quotas from New Zealand had it been available soon enough.

They said the quota system had been introduced in the interests of New Zealand. Prices were now considerably higher than they were immediately before its introduction.