Favourable conditions for S.F.M.

Press, 17 March 1977, Page 28

Favourable conditions for S.F.M.

< Invercargill Several favourable factors contributed to the record profit of the Southland Frozen Meat and Produce Export Company, Ltd, in the year to Octobc. 1, said the chairman (Mr A. F. Gilkmson) at the annual meeting. Although the mutton and lamb kill was slightly lower than in the previous year, the increase of 50 per cent in the beef kill had a beneficial effect on the profitability of processing. On the trading side, the company experienced some dramatic upward adjustments in market values, and this resulted in greatly increased realisations. It was because of this movement in market values that the opening hmb schedule was much higher than that of 1974, Mr Gilkinson said.

Early in the season, the Meat Board’s minimumprice scheme operated, but the company retained ownership of the mutton it purchased, said Mr Gilkinson. This decision also contributed to the record profit but, had the market remained static, the situation would have been different.

It was unlikely that during the present financial year the company would again experience such an unprecedented combination of favourable circumstances, so the profit of $5,573,000 would probably stand as a record for many years, Mr Gilkinson said. So far this season there had been an excellent start to lamb killing, and high tallies were achieved at both works.

The total Southland sheep and lamb kill was! 392,000 ahead of the same date last year, with Makarew r a and Matura recording a combined increase of 288,062. There was a slow start in

the cattle kill, and it wa only at the end of Januar that cattle began to com forward in reasonable quan titles, said Mr Gilkinsor It was an unpleasant sur prise for the meat trade ii Britain and New Zealand t hear on February 18 tha the Meat Board intended t< buy in lamb in an endeavou to stabilise the market. New Zealand has oppose* the price-support and inter vention schemes operated b; the E.E.C., and it was all th’ more surprising that th* Meat Board should adop this method in an endeavou to hold prices said Mr Gil kinson. The needs of the Britisl market for lamb must neve be neglected just for th sake of diversification. “Ii my opinion the whole ques tion of diversification ha been tackled from the wron end,” he said. “A quantity of ,200,000 t 220,000 tonnes of lamb mea should have been reserve for the United Kingdom, an

as i all diversification should rv take place above this level. le “We must never forget n- that the United Kingdom is n. the only market which ■ will r- absorb all grades of New in Zealand lamb every year," to he said. at No sales of lamb meat to were being made to Greece, ar to Iran, or to any other destination but the compj t y •d was still shipping all grades, r- of lamb to the United King-! >y dom. le Trading in mutton had rule ceived an added boost in the pt early months of the 1977 ar season by substantial puril- chases of the main grades by Russia.. This, together >h with competition from the er traditional buyers in Japan, lie had given most satisfactory In returns to the New Zealand is- producer, Mr Gilkinson said, as A motion to increase the ng remuneration of directors from $15,000 to $25,000 a to year was passed unaniat mously. id Mr K. S. Semmens, and' id Mr F. W. Shallard were re-j

elected to the' board of directors, and Mr G. M. Niederer, replaced Mr M. V\ Dickie.

The meeting also unanimously agreed to have Mr B. Ryan appointed to the board. Mr Ryan was a member pf the Meat Board. A final dividend of 10c g share on the paid-up capital of $7,960,213, and 5c a share lon the cash issue of 11,137,173 shares is to be paid.