N.Z. butter gets support in 'Times’

Press, 10 June 1978, Page 23

N.Z. butter gets support in 'Times’

NZPA London Ihe Common Market’s butter mountain would not suddenly start to disappear if, to the delight of European producers, New Zealand were shut oul of the British market, said “The Times” newspaper. In a background story on New Zealand’s place in a trade which sees rising surpluses, rising prices and falling consumption, the paper’s agriculture reporter, Hugh Clayton, said New Zealand’s exports and the E.E.C.’s surpluses are two separate issues. “New Zealand butter is the easiest target for the dairy industry to attack.” he said, “but its exclusion from the British market would not suddenly prevent the Community from producing too much milk.” H<- said that ousting New Zealand might make it easier for British creameries to sell butter in Britain, but it would not solve the wider Community difficulty of reconciling rising consumption with falling demand. “Surpluses it) the E-.E.C. end imports from New Zealand are quite separate issues, although Community dairy lobbies have often tried to entangle them in debate,” he said. “Certainly the presence of stocks from New Zealand exacerbates the surpluses, but their exclusion would no more help permanently to match rising consumption with falling demand, than will expedients like butter subsidies and extra free milk in schools.”

Clayton’s article appears at a time when New Zealand is being increasingly

criticised by British producers. New Zealand’s Anchor butter earlier last month had a 40 per cent share of the British market — because it was cheaper — but this has since fallen to just over 30 per cent. British dairy leaders have threatened to complain to Brussels, urging that New Zealand should be prevented from having such a large slice of the cake. Clayton said that removal of New Zealand butter from the British market would certainly help British dairy farmers. “Its presence is certainly an anomaly, but it is onlv one of many anomalies which apply to the dairy sections of the Common Agricultural Policy. “Moreover, the removal of such butter would merely encourage aggresr sive traders in Denmark; West Germany and the Irish Republic to redouble their marketing efforts in Britain,” he said. The dairy farmers who

want New Zealand out are in fact helping in a small way to maintain its presence in England. The British Government, ultimately the taxpayer, subsidises the New Zealand butter, just as the E.E.C. subsidises Community butter, Clayton said. The subsidy is to ensure that New Zealand enjoys the same trading conditions as its rivals from Britain, Ireland, France, the Netherlands, Denmark and West Germany.

Clayton said that without the subsidy on New Zealand butter, which has cost Britain S23M, New Zealand’s market share woi'ld fall instantly. “That is precisely what British farmers and dairy traders would like,” he said. New Zealand has guaranteed access of 125,000 tonnes of butter to Britain ■this year, falling to 120,000 next year and 115,000 in 1980. Negotiations with the E.E.C. for a quota beyond 1980 are expected to begin later this year.