DAIRY PRODUCE

Evening Post, Issue 77, 31 March 1936, Page 10

DAIRY PRODUCE

HIGHER PRICE POLICY

"A SUBSTANTIAL INCREASE"

EETURN TO FAEMEE

In spite of the exchange premium that he now enjoys, the dairy farmer, under the Government's guaranteed price scheme, may expect to receive more for his produce than he gets now, according to a statement made by the Prime Minister (the Hon. M. J. Savp.ge) last night. "Payment will be made in New Zealand currency by the Government," said Mr. Savage, "and Jit will represent a substantial increase on what the dairy farmer is getting now."

Mr. Savage explained that one of the principal features of the Guaranteed Prices Bill would be the establishment of a special Dairy Industry Account to finance the guaranteed price scheme in that particular industry. Using the figures purely in an illustrative sense, he indicated how the scheme would work. A farmer received, say, 84s a cwt for his butter, which represented approximately 105s in New Zealand currency. Under the guaranteed price scheme he might receive, for the purpose of argument, 112s in New Zealand currency, which meant that the Government might have to make up a deficit of 7s a cwt. However, if the price of butter advanced, say, to 120s on the London market, the return in New Zealand currency would be approximately 150s, and the gain could be used in extinguishing any earlier liabilities under the scheme, and, perhaps, in giving increased benefits. Mr. Savage emphasised, that the figures used were hypothetical, and no significance could be attached to them. He stated that he wanted to make it clear that the Government was not entering into the dairy export trade for the sake of profit. "It boils down to this," he said. "If prices are obtained which are higher than the guaranteed price in New Zealand currency, the balance will be paid into the Dairy Industry Account, and used solely for the benefit of the dairy farmers, who, in the first place, will be responsible for the production. In no circumstances will the account be dissipated for any other purpose." Mr. Savage said that forward buying at the guaranteed price would not be over a long period. The Government would have to be prepared for sudden fluctuations in the market even during next season, and would have to be ready at any time to make adjustments. Neither the farmers nor anyone else could be harnessed to one set price for all time. The Prime Minister added that the Bill had still to be finally considered between the Government and the Dairy Board and the Dairy Conference. These consultations would probably be held within the next week or so.