DEMAND AND SUPPLY

Evening Post, Volume CIII, Issue 71, 25 March 1922, Page 5

DEMAND AND SUPPLY

THE MARGARINE FACTOR.

During the past week prices for butter have steadily risen and are now lingering in the region of 145s .per cwt for best New Zealand (wrote the London correspondent of The Post on Ist February). More than this is being asked, but buyers are hesitating at any higher price. Official figures show that since Ist January the consumption of butter has gone up 20 per cent, or more. The immediate effect is that best Maypole margarine is being sold at 6jd per Ib. It is considered that so long as the public can get good butter at Is 6d retail, margarine is not greatly sought, but immediately it passes that figure a general return to the cheaper substitutes sets in. At the present time tho Government stock is getting into consumption, and. it is anticipated that for a. week O r two, the new season's article will feel the effect and remain at present prices or fall slightly. It is generally acknowledged that the .market is perfectly sound and there is no room for a sensational rise.

A large business has recently been done in colonial buter for shipment to the Continent, principally France, Belgium.' Switzerland 1, and Italy, besides smaller quantities to the United States and Canada. Probably never in the history of the trade has so lhuch Australian butter been shipped- from this country to Continental ports, and .this refers equally to Government and "free" butter. But supplies are ample, and consumptive demand is excellent. From the point of view of merchants and retail firms this is the most desirable state of affairs, and though they might not acknowledge it to the producers in the Dominion, they are probably hoping that no higher prices will prevail, as it must mean curr iailed consumption. Danish butter is very scarce, and as much as IYS» to 185s is being paid for it. Irish will pot be * available in quantities until April or' May, English will not be available until May or June, nor Danish until April or May. Except for a moderate supply from the Argentine and from South Africa, the Australasian article holds the market. Under the circumstances therefore, it is anticipated that there will, be little pr no d-rop until well on towards ]\{ay or June.

' Probably owing to a short supply for the moment cheese prices have advanced most unexpectedly. Whereas they ruled in the region of 84s a fortnight ago, 90s to 95s .can now be obtained, and as much aa 98s per owt for exceptional quality. This is out of all proportion to the position of butter, and the reason for the advance is not quite clear. However, the future position is uncertain, and there is no apparent reason why the prices should remain for anv*-?ength of time at the present high level.