The Press THURSDAY, JUNE 17, 1971. A mini-market in minipacks

Press, Volume CXI, Issue 32635, 17 June 1971, Page 10

The Press THURSDAY, JUNE 17, 1971. A mini-market in minipacks

The Rangitaiki Dairy Company, with the approval of the New Zealand Dairy Board, has installed a machine capable of making half-ounce and one-ounce packs of butter. This decision amounts to a reversal of policy by the Dairy Board, which has been criticised for 10 years or more for its reluctance to enter the world market for mini-packs. Some New Zealand butter has, in recent years, been marketed in the United Kingdom in mini-packs; but little if any of the butter packed in this way has been identified as New Zealand butter. In other parts of the world the board has consistently refused packers permission to pack New Zealand butter in mini-packs describing the contents as “ New Zealand butter ”. Butter packed in a one-inch pat is much more quickly affected by warm temperatures than butter packed in bulk, or even in lib packs. Consequently It deteriorates and becomes rancid after a comparatively short time in an aircraft cabin or in a comfortably-heated restaurant, the most likely destinations of mini-packed butter. The prospect of its butter’s acquiring a bad reputation—for reasons outside New Zealand’s control —is, no doubt, the reason for the Dairy Board’s tardiness in entering this trade.

Many New Zealanders travelling abroad, particularly for the first time, have noticed that the pat of butter served with their meal in an aeroplane or in a restaurant is not New Zealand butter. Throughout the Pacific, Australian butter is most frequently served in mini-packs. Over the years, dozens of returning . New Zealand businessmen, tourists, members of Parliament, journalists, and farmers have commented—usually adversely—on the failure of the Dairy Board to enter this market. Few of the board’s critics stop to think about the quantities involved; if every one of Air New Zealand’s 300,000 passengers a year ate one half-ounce pack of butter, they would consume four tons a year; one of the largest hotels in the Pacific, the Pago Pago Intercontinental, requires 2] tons a year. Such quantities do not impress the Dairy Board, which sells 190,000 tons of butter in the world’s markets each year.

“But think of the free advertising”, say the advocates of mini-packs. Taking the example of Air New Zealand, about half the passengers are New Zealanders, who presumably need no persuading to eat New Zealand butter. Perhaps a quarter of the passengers are Australians who, by agreement between both Governments, are not able to buy New Zealand butter at home. The proportions of Qantas passengers are different, but the arguments are the same. More than half the passengers on American international air lines are Americans; and the United States Government has refused to admit New Zealand butter to that country. Of all the major international air lines, only the British Overseas Airways Corporation holds out the prospect of any commercial return on money spent in advertising New Zealand butter in this way—and then only until Britain enters the European Economic Community and - becomes subject to its restrictive import regulations. But the quantity of butter New Zealand can export to Britain is limited by quota, so that the supply of mini-packs to 8.0.A.C. would be an inefficient allocation of advertising expenditure.

The harsh reality of the international butter trade is that, apart from the United Kingdom, there is no regular market for more than a few hundred tons of butter which is not already being supplied with New Zealand butter. Money invested by the Dairy Board in packing plant and materials is money which cannot be spent by the Dairy Board on advertising and promotion in, say, the West Indies (which takes 5000 tons of New Zealand butter a year) or SouthEast Asia (1000 to 5000 tons a year). The reasons for the board’s reluctance to invest in mini-packs are easier to understand than are the reasons for its late entry to this mini-market.