BUTTER MARKETS

Dominion, Volume 20, Issue 27, 27 October 1926, Page 14

BUTTER MARKETS

BOARD NOT RESPONSIBLE TRADE STATEMENTS DENIED CREATION OF PREJUDICE DEPRECATED A strong statement contradicting the reported representations of trade interests to Mr. Coates, that the Dairy Board, by storing and price-fixing, was responsible for the present butter slump, was made yesterday by Mr. J. R. Thacker, acting chairman of the New Zealand Dairy Produce Board: Opportunity was also taken to deprecate attempts to create consumer prejudice by misleading and inaccurate statements. A Dominion reporter yesterday drew the attention of Mr, J. R. Thacker, acting chairman of the board, to a Press message from London published on Monday stating that “Mr. Coates privately received a deputation representing all sections of the butter trade of Britain, who strongly represented that the Dairy Board’s policy of holding from the market large stocks in cold storage had had a most disastrous effect in causing a drop in values, and emphasised that the board’s proposed further step of price-fixing would be most detrimental both to the New Zealand producer and to the trade at this end. In reply Mr. Thacker stated that he had noted a determined effort was being made in certain quarters to create prejudice against the Dairy Board by similar misstatements .of fact. On behalf of the Board he wished to place on record a denial of the statements as reported and the implications arising from them. Not One Box Under Control. “At the time the trade deputation was made not one single box of butter was held in store in Britain by the board,” said Mr. Thacker. “The Rotorua, which arrived October 17, carried 36,131 boxes of butter free of control, and 3994 crates of cheese, of which only 2779 crates were under the Board’s administration. The first parcel of Board’s butter was only 100 boxes ex the Norfolk, due October 26, to be followed bv the Corinthic on November 1, with a total of 67,273 boxes of butter and 3675 crates of cheese. It is absolutely incorrect and untrue to charge the Board with storage and responsibility for the present market position. Only the Regular Annual Slump. “Similar slumps have occurred at certain stages in each of the past five seasons, independent of storage conditions and due to unregulated heavy arrivals of Antipodean produce. These past slumps have been accentuated by the practice of buyers, as stated by the Imperial Economic Committee, of holding off the market at certain periods of heavy arrivals, and so sending the market down to a level lower than was justified, while at the same time retail prices have been held at an unduly high level in comparison with wholesale prices, thus preventing, consumers from increasing consumption at periods of maximum supply and giving the producers an increased outlet with a quicker price recovery. A Fluid Adjustment. “The Board’s policy in relation to price is, and always has been, that there shall be a fluid adjustment to the economic price level from day to day on a basis which will encourage maximum consumption without sacrifice of producer interests as they have been sacrificed by the facts of annual slumps for the past five years. Storage of produce, following on periods of heavy supply and low prices, has been a recognised and necessary trade practice pending consumption of the produce, and is so admitted by the Imperial Economic Committee in . its report. Such storage when privately practised by the trade has not hitherto evoked comment. According to the Imperial Economic Committee, the equivalent of 1,600,000 boxes which reached Britain in the first half of 1925, was an over-supply for consumption in that period, and was necessarily stored by the trade for consumption ( in the second half of the year without slump reactions on that occasion. Fixet storage is not approved by the Board, | whose policy will be to maintain consumption in the order of manufacture, and so avoid any possibility of uunecessary accumulations. Storage Statistics Desired. “As the difficulties of the present situation are increased by lack of accurate knowledge of the stocks concerned, and as’ the Board. has strong reason to believe that certain estimates which have been published are exaggerations of the facts, I, on behalf of the Board, strongly endorse the recommendations of tlie Imperial Economic Committee that official statistics of the amounts of produce in store in Britain should be regularly published. No Antagonism Desired. “The members of the Board deplore attempts to create consumer prejudice against New Zealand produce by misrepresentation or inadequate statements. The New Zealand producer desires the good-will of the British consumer, and will do nothing to forfeit it. The course, of the market in the past is admitted by the Imperial Economic Committee to have been at times prejudicial to both the British consumer and the New Zealand producer. The more orderly marketing of New Zealand’s production aimed at by the Board seeks to avoid those excessive price fluctuations which, while not adequately benefiting the British consumer, have seriously limited the producer’s returns and affected his ability to buy British goods. The existing and past disparities between foreign and Empire butter are not regarded as economically fair or justifiable. If the mind of the British consumer is not poisoned pending the plans of the Dairv Board being given adequate, trial, the: e will be no cause for complaint.”