U.S.S.R. a big N.Z. butter buyer

Press, 14 March 1983, Page 30

U.S.S.R. a big N.Z. butter buyer

PA Wellington New Zealand could become dependent upon the Soviet Union as a butter customer because of European Economic Community and United States trade restrictions, the Dairy Board chairman, Mr J.' T. Graham, told an industry ward conference in Stratford.

“We are beginning to wonder whether both of the ‘giants’ recognise that they* have moved us so much closer to being a major supplier of the Russians,” he said.

Stocks in the United Kingdom which had been managed downwards to be “close to right” and the strong Soviet buying enabled the board to report a satisfactory butter stock situation, said Mr Graham.

But, he said, although the board was happy to trade with the Soviet Union or anyone else, the board did not wish to be thrust too deeply into dependence on the Russian or any other butter market which could disappear. Dependence on the Soviet Union had resulted from New Zealand’s virtual exclusion from the United States butter market and the progressively restrictive access to the European Community, he said.

Import restrictions by “the Americans as much as by the Europeans and others” had mostly closed off the inter-

national dairy markets, said Mr Graham. Those markets which were accessible to competition were far too small to accommodate the sort of surpluses the United States and Europe had been producing, he said.

“These realities have been made clear to the American authorities repeatedly, but nevertheless the internal pressure, especially from the dairy lobby, continues,” said Mr Graham. “We believe that economies as large and wealthy as the United States and the E.E.C. are able, and should expect to ensure reasonable equity for their producers without such massive and disruptive interference in commercial markets.” Mr Graham said the domestic imbalances in Europe and the United States, taken with the disagreement between the two trading powers over agricultural trade in general, meant that “we are at a very vulnerable moment.” Should the United States be inclined to use its dairy

surplus to beat the Europeans, he’said, it would seriously damage New Zealand’s interests while it would not be likely to make a “lasting dent” in European policies. “They are both friends of ours, but their policies are equally dangerous.”