BEEF SUPPLIES AND PRICES

Dominion, Volume 37, Issue 60, 6 December 1943, Page 4

BEEF SUPPLIES AND PRICES

Matters have reached a serious point when any section of the retail trade is recommended by its central organization to disregard an official price order, but that, apparently, is the position in the retail meat trade. Representations made to the Government are said to have brought no results, and it has been stated that many butchers, specially the small men, are now faced with the choice of either disregarding the order or closing down their businesses. The cause of the difficulty is the marked disparity between the prices which butchers have to pay for supplies of beef and the schedule of prices at which they must sell. < The trouble —it is by no means new, but only more marked this year—-is the shortage of beef supplies. In the late winter and early spring beef prices at the yards have often been above the retail selling level, but the trade has absorbed the temporary loss averaging out over the year. At the present time, however, circumstances have aggravated the position, and high prices for prime stock have continued to rule into December and seem likely to continue. The retail butcher cannot, unless he disregards the price order, increase his prices to customers, and it is impossible for him to continue purchasing supplies to sell at a loss.

The chief contributing factors have been the exceptional demand for beef for other than civilian consumption, and the marked scarcity of supplies. Climatic conditions have made it extremely difficult for graziers and others to bring the stock up to prime quality. The position is stated clearly in a report prepared' by the Live-stock Division of the Department of. Agriculture and published in the latest Abstract of Statistics. It said, referring to conditions in the Wellington province: “Cold, wet weather has been general in the Wellington district and all hay and ensilage has been used. Stock are in poor condition and growth is slow, cattle feed being very scarce in the Wairarapa. Similar conditions have prevailed elsewhere. Farmers depend upon the supplementary feed to carry the stock on until the growth of the pastures is sufficient, but, apart from exceptional cases, that has not been possible this year, with the result that prime stock has been scarce and what there is represents heavily increased production costs to the men on the land.

The position admittedly presents serious difficulties. The prices for stock could not be fixed arbitrarily without inflicting heavy losses on those farmers who have made a persistent effort to carry their stock through the winter and unfavourable spring. A factor which the price-fixing authorities seem to have overlooked is that the cost of production of beef supplies is not static. Had conditions been anything like normal, then the reduction in retail beef prices that was to have come into effect on December 1 might have presented little difficulty. The normal increase in supplies would have been reflected in easier prices at the yards. But the conditions experienced have effectively prevented that, with the result that the retail trade, with the restrictions imposed on it, is' faced with a problem that it cannot solve unaided.