DAIRY FARMERS’ INCOME

Dominion, Volume 28, Issue 232, 28 June 1935, Page 12

DAIRY FARMERS’ INCOME

Guaranteed Prices LABOUR PRESIDENT’S ADVOCACY Proposals Challenged at ’ Conference EFFECT ON BAND VALUES Dominion Special Service. Palmerston North, June 27. . Guaranteed prices as a means of giving dairy farmers a payable return for their produce were advocated b'y the president of the New Zealand Labour party, Mr. W. Nash, MJJ., in an address to the National Dairy Conference tcnday. When the conference reached a remit from the Parkvale Dairy Company expressing the view that delegates should unite and work wholeheartedly for a guaranteed price to the costs of production, the chairman, Mr. A. Mortpn, said that since reviewing the remit the executive had asked Mr. Nash to attend and explain what was meant by rf^gua^anteed-price and how it could be Following Mr. Nash’s address, Mr.,. A. J. Sinclair, secretary-manager of the He Awamutu Dairy Company, was given at his own request an opportunity to reply to Mr. Nash. Reference was made by to. the destruction in various other parts of the world of goods that people were in need of. He said what was desired was a stabilised minimum income for dairy farmers. The cost should be the determinant of the price, which was rarely measured in terms of the cost put into production. British producers of milk received a guaranteed price for every gallon produced. An unremuneraflve price for any primary or secondary commodity invariably burnt itself out apd also the producer of that commodity. The Wellington City Corporation, basing its prices on factors overseas, but not necessarily so, paid a guaranteed price to all -dairy farmers within a certain, zoned area for supplies of milk for distribution to the citizens of Wellington. Between 1928-29 and 1933-34 production had gone up 40 per cent, and income had fallen by 30 per cent. It was impossible for an industry to carry on for any length of time and be subject to fluctuations of that sort. He was of opinion that the maintenance of production depended on the upkeep of farms and the payment to the farmer and his assistants of a sufficient amount to maintain a standard of living measured by the market production resources of the country. That was the first essential a farmer should be paid for, the time, skill, knowledge and labour put into the production of his commodities. That payment should be .measured by the same standard as that used to measure the efforts of those who rendered equal service. “Essential to Progress.” Guaranteed prices and orderly marketing were essential to progress, Mr. Nash continued. It had been argued that under a policy of guaranteed prices investments would fall away, but there could be no sounder safeguard for investment than guaranteed prices,, for they would stabilise the value of land. Mr. Nash said the dairyfarmer should be paid a positive price for his produce. It might be asked what the price should be, but he did not want to determine the price at present. The banks would probably pay to dairy factories roughly 80 per cent, of the price realised in London and the balance would be collected in the form of a final payout. Instead of paying out 80 per cent, he suggested that under a system of guaranteed prices the full amount should be paid out. Britain was prepared to take up to 150,000 tons of our butter it should be possible to go to the people at Home and telj them New Zealand was prepared to make an allocation of its credits from the sale of that butter to the manufacturing industries of the Old Country. Butter would be required for our own people, say, 30,000 tons, and it would probably be possible to get smaller contracts with other countries amounting to, say, 20,000 tons. "We would then go to the Dairy Board,” said Mr. Nash, “and say, *iye will pay you so much for 200,000 tons of butter f.o.b. for ports we want to send it to.’ ” Very’, Very Carefully. At the conclusion of Mr. Nash’s addn*; Mr. Sinclair rose and asked if he could have five minutes to reply. “I can reply in five minutes to what Mr. Nash has taken half an ho*ur to say,” said Mr. Sinclair. “I think the industry must weigh un the facts very, very carefully before' it shows the countrypt is prepared to commit Itself to some form of guaranteed ’prices.” Continuing, Mr. Sinclair said most of the products referred to by Mr. Nash as having been destroyed were produced in the same countries as they were consumed. A country consuming only 10 per cent, of the butter It produced had to depend on its exports and world parity. If prices were to be guaranteed the people of this country would hqve to pay money. It could only be done by direct taxation or some method of adjusting the currency. Mr. Nash had refused to mention what, he considered to be the guaranteed price for the simple reason that lie knew that if he gave a figure there were men at the conference who would show him it could not be done. Quoting a statement by Mr. F. Langstone, M.P., mentioning the figure of 1/3 a guaranteed price, Mr. Sinclair said Mr. Langstone wanted the community to pay 1/3 for a commodity that realised Cd. Mr. Sinclair said the moment a guaranteed price of 1/3 were given for butterfat the value of land would go up. A delegate: Hear, hear. Mr. Sinclair said in the course of two or three years farmers might do well if they stayed on their farms, but many would want to do as they did in the past, and sell. The men who came in would have to pay inflated values, and no one would be any better off. Jf a higher price were obtained other than by a natural rise in the market, the people of New Zealand would have to pay that price. Replying, Mr. Nash said Mr. Sinclair’s argument was that because the world parity was Cd. a pound for butterfat a. farm could be run on 56/- a cwt.

'the arrival of the adjournment prevented further consideration of the remit, which will he discussed tomorrow.