WHY HAVE PRICES RISEN?

Dominion, Volume 3, Issue 765, 14 March 1910, Page 8

WHY HAVE PRICES RISEN?

■; ;?1 ;5,f MERCHANTS' iVIEWS, ~v^V k S S t T J? e 'n'butter on Saturday, Mr. J. ij. MacEv;an said he believed the jump was undoubtedly due to a, shortage of production in the northern world. When the big'-rise of two years ago was made it was not legitimate, and wa S. no i t Tiis.tiirie.there seemed really ,an actual: shortage of'supplies,. J-roia thev latest: advices he. had ■ received as to. conditions' in- Britain' and on the .Continent, ■ an unusually severe winter being experienced. , 'In' fhe Kingdom the weather, had' been ■dry., with very severe frosts', and snow ; a y over a large area of .'the countrv. floods in I'rance had caused a. rise in , the; price of French butter, so that supplies from fhaf quarter would be short for. some, weeks. The field, on the other side; was so big that it was difficult , W gauge.the situation even at close quarv"; Nevertheless : he ' felt fairly confident,tho'.movement was not a< speculative one. The market had been steadily'hardening torsome time, and the conditions at Homo offered a satisfactory explanation :qf'the' position. . ;. ; ',"■■■' . ,• _'Asked. Whether any quantity of New Zealand butter had been diverted of late to South Africa or elsewhere, thus affecting the position, Mr. MacEwan. said no. South African shipments' were on tii-a usual scale, and were too small to count in the general situation. Our production .wiis' abnormally large, and practically the whole of it was going to the Old •Country.- We had had ideafrweather con.;diti.ons:.:;The :Jieayy.urain j$ the cuid' of January r,was worth 'itdnis ofogold to the &i$ to s>ap' it came : : another.jjieajyjfaii a£ tte eft! of Febru:n "Suminiaig--.up .-the ■posit.ion,'' continued :Mr. JlacEwan, "I would say that supplies are not up to demand*-. Speculation may have something to. do with it,- but if the movement is'.purely speculative .1. don't think it would hold the market for so long. . Whatever-is causing- , tf. it is.. a ■ great boon U>l£Xy#n\\& . arid New .ZealaTid while ■ heavy. Practically everyone is looking forward .to a gradual decline at any time, owing to the approach of the.northern spring and the increase in supplies." . Sir. J; G. Hartness, managing director of the National Dairy Association, who very.kindly supplied the details of the lonics consignments given elsewhere, was also of opinion that the rise irtis due mainly to a shortage in the Continental supplies.. There reas- certainly no Australasian, shortage, and if the market continued in anything like its present state : for,, any. ;iiino (.Now Zealand would !bo in^a , 'positi6'n.'tb''do' o very-". , we1l indeed out. of it. The splendid, weather had caueei , a-revival in the factory outputs, and although it was getting lr.te in the-i season no great decrease had yet takeji place, and this in spite ofj..the fact that most of the cows had come* in unusually early. ■ . ■ .' . Mr. V. N. E.' lle.-.dows, New Zealand representative for Messrs. Pearson and Itutter, was inclined to take a cautions view of. the situation, ami eaid that after the experience of 190S it looked to him j rather, as'-though .the present rise was owing-,inainly^toi thought it very db'ubtfurffonV'the advicce that had reached him that there waa any material shortage in European connfries. The IMS Hutter proved to have been engineered by two or three houaes. and he should not be at all surprised if the sr.rae firms, were not responsible tor :the'preserirjflriVp'.Yishe eab,le stated that "the market'' had been cleared, but while |

this might be technically correct, it was another tiling to ascertain absolutely what stock's rcero being held in cold store. .The'present prices were naturally very satisfactory to producers, but it was well not to build too much on them.. Speaking of South African shipments, Hγ. Meadows said these were trilling. Ho believed he was the largest consistent shipper io that market, and he had been sending only 400 or 500 boxes a •month there. ■ The .last exporter visited pooh-poohed the idea of speculation. Very little speculative "holding would have , taken place, he thought-, with the prices that had been lately ruling. In fact, all the butter "shipped Home seemed to have been got rid of as soon as it came to hand. There had been a very bad spring, and the outlook. was bad both in Britain and on the; Continent. He anticipated that both butter and cheese prices would be decidedly on the high side lor the next six weeks. I'rom his advices it looked as though supplies in London would be short for. the next two months. As. the s?ason advanced it was inevitable that , the market would weaken, but he did not anticipate •. any immediate sudden drop such as'took place in 1308.