Dairy industry prospects

Press, 2 January 1985, Page 2

Dairy industry prospects

Dairy products can earn New Zealand nearly $2OOO million, within the next season or two, in export receipts, if prices lift on world markets, according to Mr Bruce Tolich, chairman of the Dominion dairy section council of Federated Farmers. This would depend on the speed at which Europe brought its milk production back in line with demand, although New Zealand could continue to find markets for nearly all its products, he said. Mr Tolich said 1985 was starting off well with production on farms looking good, rain and grass abundant, and the benefit of reserve funds to cushion the present downturn in world prices. He expressed doubts, however, that the Govern-

ment was cutting expenditure enough to pull back interest rates which stood out as farmers’ worst enemy in 1985. The Prime Minister, Mr Lange, wanted a lean dairy industry, but farmers in return wanted lean Government departments, and evidence of such a policy in the next Budget. Mr Tolich said that the selective cuts in expenditure to assist industry and increases to revenue through the fringe benefits tax, were no substitute for reduction in the largest areas of Government expenditure; health, education, and welfare. Mr Tolich said it was not easy to suggest such courses of action, but they were the harsh reality for a while and certainly as New Zealand entered 1985.