E.E.C. recognises N.Z. dairy setback

Press, Volume CXVI, Issue 34130, 17 April 1976, Page 9

E.E.C. recognises N.Z. dairy setback

P A. Staff Crspd: > LONDON. New Zealand’s policy; nf finding new markets for dairy exports, and reducing its dependence on Britain, suffered a setback last year, the European Economic I Community’s Commis- ( sion says in a report just I published in Brussels. Un spite of this. New; Zealand has made "consider-; abl“ progress towards j market diversification for; chees’ since Britain joined, the Common Market," the’ report says. “For butter, j however, no substantial new; permanent markets have yet been developed.” The report says the pro-i gress New Zealand achieved' tn diversifying its dairy l markets in 1973-74 had been] eroded by developments last] year. It does not blame New; Zealand for this, noting that the setback resulted from re-i duced demand because of the world economic recession coupled with increasedi production following a ■ period of drought. Under the special arrange-1 ments in protocol 18 of Britain's E.E.C. accession treaty,!

which allows New Zealand |i continued access to Britain, ji she is obliged to make every I; effort to find other markets, i In return, the E.E.G. iundertakes to follow trading : policies which do not frus- < itraje New Zealand’s effort i to diversify. ; The report.is the commis-1 :sion’s annual survey of the; j operation of Protocol 18. Iti (notes that in 1974-75, 82 per cent of New Zealand’s butter I exports went to Britain, l against 71 per cent the previous year and 83 per cent iin 1972-73. ; The proportion of cheese! jexports going to the United-; (Kingdom rose from 32 peri icent in 1973-74 to 44 . per! .cent last year, but this was! (still well below the 71 per icent of 1972-73. The loss of trading op-| i portunities last year on (the American market, where 1 import restrictions were rej introduced after a period (of much freer access in 11974, was the main factor. The report notes that New Zealand sold 10,000 tonnes (of butter and nearly 750 (tonnes of cheese to the ' United States in 1974. These (figures were down to 184 i tonnes and 134 tonnes reispectively in 1974-75. Butter sales to Japan also (fell heavily last year, though cheese exports remained 1 high and Japan is now New

(Zealand’s second biggest j market after Britain. Opportunities for butter and cheese in several other smaller markets, including the Middle East, did help to offset the setbacks suffered in the United States, Japan and Canada. I The commission says New ! Zealand’s problems confirm ithe view that opportunities for diversification depend greatly on the import policies of third countries. The E.E.C. remains committed to seeking international agreeiments on dairy products. I The commission confirms (that it is keeping the question of New Zealand’s costs (and returns under review — (thus paving the way for a (further application for a (price increase this year to (follow the two 318 per cent rises awarded in 1974 and 1975.