BUTTER IN LONDON

Evening Star, Issue 18254, 19 April 1923, Page 6

BUTTER IN LONDON

BOTTOM OUT OF THE MARKET. DROP UNEXPECTED. BUT REASONS NOT OBSCURE. Clark Russell tells a story of a first mate surprising his crow by ordering sail to be shortened in a very light breeze. Tho skipper, awakened'by tho clatter overhead, ran on deck and thought tho mate had gone mad. Askod why bo was stripping the yards and stays, tho mate pointed to tho barometer and said ho had never seen it drop so quickly. As a fact, the bulb of mercury was out of sight. No wonder. An accident, unroported to him, had happened, and tho mercury was on tho floor, tho bottom having boon knocked out of tho instrument. Some parallel to tho story may bo found in tho tumbling down of the butter market in London. It can be explained. It need not cause alarm. There is nothing sinister or malevolent to be found out.

Inquiries made by a 1 Star ’ reporter from men who are in the best position, amongst our community, to know what is going on reveal some, at any rate, of the causes.

Denmark has in tho past been, supplying the Continent, sending most of her butter southwards. Now, for reasons that are not stated, she has suddenly turned the bulk of her export to London.

Again, this is the flush of spring in tho Northern Hemisphere. There lias been a groat growth of grass, and from Holland, from certain districts in France, from parts of Germany, and particularly from Canada, tho London market_ has been over-supplied. Siberia, too, is coming into the picture once more. She has been shut out over since tho outbreak of the war, and is now trying to open up an outside trade in butter, especially in the secondary classes that she produces liberally. Somo_ men in the trade question whether Siberia’s contribution tins season will amount to much, seeing that her people arc starving; but tho effort to spare something for export must count for something in view of tho fact that money is wanted as well ns food, and it is significant that tho Soviet is reported to be prepared to facilitate tho exporting as much as possible. Moreover, heavy supplies have 1 been arriving in London from New Zealand by steamers that were late in getting away.

Advices just received from London by mail show that the drop now reported by cable was not expected six weeks ago. Nobody hero professes to have any idea as to when the bottom will ho touched. Nine-tenths of the operating influence is the inexorable law of supply and demand. In that view there ran ho no recovery until a largo proportion of the surplus stock lias gone into consumption. Incidentally our reporter was shown documentary evidence which goes in the direction of contradicting the assertion that Australia is ready to take onr butter at a big priee. The Australians are ready to negotiate sales, but at a price which they fix as a maximum, and that is in the neighborhood of Is Gd. They certainly are not prepared to let New Zealand exploit them on account of the Australian drought.