THE BUTTER TRADE.

Evening Star, Issue 21505, 1 September 1933, Page 6

THE BUTTER TRADE.

The ninth annual report of the New Zealand Dairy Control Board covers a period more tense than any which the industry has yet passed through. It was a year of record production. An increase of 23,588 tons of butter and of 12,804 tons of cheese brought the totals tb 127,799 tons of butter and 100,998 tons of cheese. The dominion’s dairy herds now comprise more milking cows than the human population. Their number last season was 1,820,600, which is about 60 per cent, greater than it was ten years ago. At the same time other dairying countries have aimed at expansion; but there has not been a corresponding expansion of outlets, and the prices realised have fluctuated down to levels which brought despondency to the hearts of producers. At the end of J uno prices were 25 per cent. lower than in 1914 and costs of production were 25 per cent, higher. This m itself points to overproduction. The Dairy Control Board declines to entertain restriction of output as a remedy. It is all very well for other countries, says the report in effect, where perhaps other classes of farming may bo turned to; but in New Zealand, it is urged, there is practically no possibility of changing with udfrom dairying to other classes of farming. The objective held out in the report is “to ha\ r e the quality so high and the cost of production so low that the complete quantity which is produced can bo marketed on a satisfactory basis.” Wo are afraid this is counsel of perfection. That point of view was urged on the British authorities, but they have declared it not practicable so far as their country’s ability to absorb our full ship-> ments is concerned. Britain’s declared policy is by stopping tho flooding of her markets to raise prices so that British dairy farmers can make a living. Figures of tho total importations of butter by Britain for the past ten years show tho extent of tho flooding. In 1922 Britain imported 188,781 tons of butter and in 1932 she imported 422,456 tons. Now the British authorities have called a halt. The export of butter from European countries has dropped 20 per cent, in two years.; nevertheless, Denmark, regarded as Now Zealand’s chief competitor, increased her exports to Britain by nearly 12 per cent., other former markets, such as Germany, being virtually closed to her.

The board’s consideration, of alternative markets gives small ground for encouragement. A small but steady business is done with the Panama Canal zone, but so far as Japan, China, India, and the Malay Archipelago are concerned it is the board’s conclusion that this business is best left to Australia, whose total shipments to the East now total loss than G,OOO tons, arc increasing but slowly, and are not very remunerative. New Zealand would be at a double disadvantage in competing there with Australia, whose exporters enjoy regular services at lower freights than New Zealand could obtain, and whose exports are subsidised under the Paterson scheme. There appears to be one factor in Britain which the Dairy Board is watching, and that is the decreasing consumption of margarine. About 3,400 tons of this substitute or rival are made weekly in Britain and a relatively small quantity is imported also. Figures, however, show the consumption per head to be on the decline, but it is doubtful if they would not revive again if the price of butter were to recover from past low levels. The Dairy Board evidently considers that the margarine interests have a strong “ pull ” with the British authorities. The example of Continental countries in imposing severe restrictions on the margarine trade in the interests of both health and the dairy farmer has not been followed in Britain, and the advocacy of a duty on whale oil has met with no response, as that commodity is used in making soap as well as margarine.