Confidence after talks in U.S. on dairy products

Press, 22 May 1982, Page 7

Confidence after talks in U.S. on dairy products

NZPA Staff Correspondent Washington The president of Federated Farmers', Mr W. R. Storey, says he has gained the impression from talks in Washington that increased American dairy exports which could harm New Zealand trade are the last option in emergency dairy measures the Reagan administration is proposing. Mr Storey, the Federated Farmers' immediate past, president, Sir Allan Wright, and its chief executive, Mr R. D. Mclagan, have talked with the Deputy Secretary of Agriculture, Mr Richard Lyng, the House agriculture comiriittee chairman, Mr Kika 1 De La Garza (a Democrat from Texas) and with American farming organisations. American dairy production is continuing at a high level, and the’ Government-held surpluses are mounting. Legislation proposed by the secretary of agriculture,

Mr John Block included increased give-away programmes for America’s poor, a lowering of the Government support price to discourage production, more dairy products to go to the armed forces and as aid to developing countries as well ; as an export drive. Mr storey said that the messages he was getting were that the Americans were not necessarily going to export any of the dairy surpluses, for which the Government paid only about half the world price. He had the impression, he said, that exports would be a last resort, and that New Zealand's position would be taken into account if they went ahead.

One worrying aspect, though, he said, was. the prospect of dairy products going to Caribbean countries — a market New Zealand had built up over the years

— as aid or at cheap rates. The emergency legislation Mr Block proposed also included setting up a task force bn casein to investigate whether exports to the United States were subsidised, but Mr Storey said he had gained the impression that this was no more serious than previous threats to the casein trade. (New Zealand supplies America with 51 per cent of its casein — all previous attempts to restrict imports have failed.) Lamb and beef problems centred on high production costs in New Zealand. Mr Storey said, and the drop in lamb sales in the U.S.A., against increased supplies of lower priced American lamb was “certainly very worrying.”

Mr Storey said the talks in Washington concentrated on America’s efforts to open up the Japanese and European markets.

He did not believe the Administration supported retaliatory protectionism, he said., but it was clear that both the urban and rural electorates were concerned with high interest rates and unemployment and were notin a kindly frame of mind, toward imports. “That was a warning we certainly took," he said.

The New Zealanders were also briefed on the situation of American farmers, faced with low prices for many commodities and high interest rates on loans taken out in the expectation of continuing healthy profits. They were told that about 2500 farmers were selling their farms every week, Mr Storey said. The farming leaders went on to New York for discussions there with New Zealand meat representatives, tc inspect a processing plant, and for talks with the lamb promotion council.