HOLDING BUTTER

Evening Post, Volume CXIII, Issue 86, 12 April 1927, Page 11

HOLDING BUTTER

DEFEATED ITS OBJECT

FURTHER LONDON CRITICISM

'■Evening Post," 12th April

Mr. Robert Logan, chairman of the National Mortgage and Agency Company, in addressing shareholders in London on 2nd March, referred to the effect of supplies of New Zealand butter held up in London in September and October last. ''This," he said, "was responsible for the fall in values which took place then. The fall was undoubtedly brought about through many shippers of butter having cabled instructions to withhold their stocks from sale and place them in cold storage— presumably expecting the high prices which had ruled in the autumn months of the previous two or three years to recur. The cold storing of such a large Quantity of butter, however, defeated the object in view. Naturally, buyers knew of the existence of these stocks, and consequently adopted a hand-to-mouth policy of buying, with the result that month after month this heavy stock became an increasing incubus on the market."

Mr., H. C Cameron (formerly produce officer m London to the New Zealand Government) expressed his views to the meeting of the National Mortgage Company on the action of the New Zealand Dairy Board. Mr. Cameron said he had been closely associated with the dairying industry in the Dominion from its inception, alike as a milk supplier and secretary to the dairy factories in the Dominion, as a distributor of New Zealand dairy produce in this country, and as representative of the producers' interests here when produce Commissioner for the New Zealand Government. From his many years' experience of handling and distribution of JNe\v Zealand butter and cheese, he considered control essential, and he had repeatedly urged the necessity for it, so far as it affected regulation of shipments, control of distribution and stability of prices on the English market. "I was pleased when a board, representative of the New Zealand producers' interests, was set up," continued Mr. Cameron. "That board has been empowered with absolute control. Kit I/ )e"eve to be necessary, as without it the board might be impotent to carry out its functions, but I believe such great power must not be used by ft except in the case of extreme urgency. But what do we find? Instead of performing its iunctions m a fair and reasonable manner —using tact in introducing a new system —the board autocratically issues instructions how the New Zealand dairy industry is to be.conducted in future. While 1 consider it desirable that a market .alue should be agreed upon by the board, after consultation with representatives of the produce trade, at which the butter and cheese should be sold, the board has been nxing a hard and fast price, and then suddenly and unexpectedly changing it The week before last the board raised the price of butter 2s per ewt, although the state ot- the market did not warrant that being done, and last week reduced it by 8b By such action I consider the board has greatly handicapped the New Zealand trader It has antagonised the retail distributing houses, and has reduced the demand for Aew Zealand butter throughout the country very considerably.' "The board also refuses to allow thoße dairy factories in the Dominion, who formerly had been sellers there, but who are now compelled to ship on consignment through the bdard, to select, their ownagents m this country for the sale of their produce, even though such agents may meet with the approval of the board as satisfactory for the purpose. They must place it in the hands of any agent chosen by the board. Is that fan- to the producers? The board further refuses to permit factories that, by push and advertisement by former agents of their brands command a premium in price for their output, to get any advantage from that" benefit. They must share the premium so obtained with factories whose produce is of less value. By this restriction emulation amongst dairy factories is destroyed, and, consequently, improvement in quality of Aew Zealand dairy produce is retarded. At the same time, the agents Jiere have no incentive to compete against each other for best results on behalf of their clients. There is evidently a great lack of real business experience in the management of the Control Board in this country. I trust, therefore, that strong representations may be made in the proper quarter to have some change made in the policy of the Control Board, that may lead to more amicable and satisfactory working of a system that, if conducted on sound hues would, in my opinion, be ot considerable value to the dairy industry ot New Zealand."