THE DAIRY INDUSTRY.

Hawera Star, Volume XLVIII, 11 February 1925, Page 7

THE DAIRY INDUSTRY.

BOARD’S OVERSEAS DELEGATION. MARKETING OF N.Z. PRODUCE. A STRONG POSITION NOW : QUALITY ALONE WILL HOLD IT. “New Zealand has established a strong position upon the British market by reason of the general excellence of her supplies of dairy produce. This is not saying that all are equally good, or that there is no room for improvement. We shall examine the weaknesses as we proceed, but it may be stated tit the outset, notwithstanding the few exceptions, that Danish and New Zealand stand in a class by themselves at the head of imported butters, while many discriminating buyers assert that New Zealand cheese has now got definitely ahead of Canadian. Only one thing can enable us to maintain our position; the supply of a uniformly good article. ’ ’

In these words Messrs W. Grounds, J. R. Thacker, and W. C. Motion, who comprised the overseas delegation of the New Zealand Dairy Produce Control Board, introduce their report to the Board. Extracts from the report were published in a Press Association message yesterday; but the full text is now to hand, and, as it is of sufficient importance, to be circulated as widely as possible, we propose to make it available to farmers through the columns of the Star. That part of the report dealing with the condition of our produce when it reaches the market, and covering the business of marketing, is printed below. Port facilities, and the position of those countries f which are our rivals in dairying, will be featured in to-morrow's Star.

tutions, but endeavour to indicate the work and influence of the different factors in the market. .Members will be tamiliar with the circumstances leading up to the establishment of the Marketing Association, a combination of New Zealand factories and the Co-operative Wholesale Society of England. That the importers resented this establishment is still obvious by the fact that the' Marketing Association was not invited to join the recently-former London Importers’ Association, and when they subsequently applied for admission were refused. Soon after our arrival in London the position was referred to us by a prominent member of the Importers’ Association. We decided that'it was not within our province to decide who should be members of f that association. The Marketing Association conducts its business in the same manner as the importers, much of their business being done with the C.W.S. and the Scottish Wholesale Society. These societies have increased their business tremendously of late years, "and now have very large distributive organisations. They are large buyers of Danish butter, fully 80-per cent, of their requirements coming from this source. Any impartial review must recognise the important factor they are in the distributive trade of Great Britain.

NEW ZEALAND CO-OPERATIVE DAIRY COMPANY.

The organisation of the New Zealand Co-operative Dairy Company, set up to regulate the supplies of its. own manufactures, and maintain a supply throughout the whole' year, has been successful in more than this. Its adoption of a superfine brand, alawys offered at a premium, together with , its advertising and other propaganda to keep it before the public, has led to it now being regarded in many quarters as the superfine New Zealand butter. The introduction of carton package in the sale of their “Anchor” butter has prompted some hostility from the British companies having a proprietary brand of their own, but the steady increase of its sale in this form indicates the appreciation of the public. Beyond the establishment of a certain goodwill for their own commodities, their efforts to stabilise prices have been beneficial to the whole industry. Remembering the extreme fluctuations which have characterised the lqst few years, some may he led to ask where this has displayed itself. We feel that had it not been for their stabilising influence the fluctuations would have been greater. Their influence ’•pon the market is unconsciously disoiaved bv every dealer by his frequent ’’efererme to the price. of “Anchor” as > kind of basic 1 "Standard’ whatever brand he may he selling himself. OVERSEAS FARMERS.

One other institution, the Overseas federated Farmers, connected with us more by aims than actual business, is engaged as an importer and general listributor. Through this agency part- of the Australian supplies are sold. They have their own floor in l oolcy street, doing business with merchants and retailers. They are anxinis to extend their operations by- including New Zealand produce. In the season when Australian is not available, tliey handle considerable quantities of North European butter. CONDITION OF PRODUCE ON ARRIVAL.

Besides questions of ocean carriage this envolves many points antecedent to shipment, which require attention if we 'are to deliver —and it must be our constant aim—a uniformly high rrade produce. There is plenty of room on the British market for the best, but little room for inferior qualities.' These are supplied in sufficient quantities from other sources. As far as our limited inquiries upon steamers allowed us to judge, we think that if produce is in good condition when shipped it will open up well in Britain. 'The ships’ refrigerator logs indicate that temperatures are kept as stipulated, although when working numerous small ports in New Zealand in the summer, the hold temperatures are sometimes much too high for several weeks. The " appointment of an inspector for New Zealand ports should suable many minor defects to be recognised and corrected. Dealing first with butter, our experience lias led us to conclude that if it. is well’made from sound cream, and well kept in cold water, there is no appreciable deterioration for quite a considerable time. We saw a South Island brand opened up in London which had been in cold storage there for five months, or seven, months from date of manufacture. It was as good as could he wished for. Frequent complaints are heard or over-neutralisation, or. as tliev call it, “preservative flavour.” It will be observed that the implication is worse than the actuality. With the recent decision of the Parliamentary Commission that the use of boric acid in butter must cease in two years, it is doubly necessary to get ’ away form the “presrvative” idea promoted by overneutralisation. In <mr American reports we drew attention to the prestige of “sweet -ream butter.” Towards this ideal we (Continued on page 6).

“TOOLEY STREET.”

IMPORTERS' IN THE: FLESH. ORGANISATION AT THE LONDON END. The importer, as is well known by all who are actively connected with the trade, is the first connection link between the producer and the consumer. Some of the importers have been connected with the New Zealand trade since its inception, while others have been associated with it for many years. That they have prospered in the business of their choice is clearly apparent. If further evidence of this were required, it is forthcoming in the number of provision merchants who desire to become importers. Many pictures have been drawn of these importers for the guidance or confusion of New Zealand dairy farmers. Having seen “Tooley Street”—by which term importers are usually personified in New Zealand both individually and collectively, and discussed with them everything we thought of immediate interest to the industry, we can only report that we found them to be ordinary keen business men, who concentrate upon their business, keeping in touch with all the widespread’influences upon their market and doing, what in their judgment is best for their consigning factories, while they quite naturally expect to get a fair turnover for themselves out of the transaction. Whether the system in vogue by which these judgments are formed is best for the producer we shall presently discuss. Some of the members have made special studies of important allied subjects, their exoeriences and conclusions being freelv placed at our disposal. Throughout the whole of our investigations evervthing possible was done for us by the importers. They each expressed their desire to assist in whatever was decided upon by the board in the interests of the producers. We would further add our opinion that possibly no other body of men could have done better under‘the system prevailing. If the system orovided them with alluring opportunities, they cannot be criticised for embracing them. The Usual connection in the chain of selling agencies •is for the importer to sell to the wholesaler, who in turn supplies the retailer, except in the case of the large retail chain -stores, who buy direct form the importers. Samples are available at Toolev Street for inspection, but frequently sales are made without inspection/ based upon fao-tory brands and grading. The sale being made,-the importer gives an oi’der upon the stores for the quantity sold. THE WHOLESALER..

The wholesale merchant handles .all orocers’ requirements, and in this way fs brought into close touch with the small retailer, who can place an order for a comparatively small quantity ot many varieties of goods and have them delivered to his shop any day of the week . Frequent deliveries are possible in this way, whereas to deliver dairy produce exclusively could not be undertaken except at greatly increased cost. Some of the importers handle only butter and cheese, while some add bacon and hams to their stock-in-trade. One of the importing houses supply the retailers direct, having a large fleet ot motor vans for the purpose. In eveiy respect this firms fills the dual purpose of importer and wholesaler. Some ot the wholesalers resent this as an interference with their legitimate business —it is curious sometimes the sense in which “legitimate” is used while others anxious to become importers maintain that, closely connected as they are with the myriad small retailers, they could give better results to producers than the present system allows. They maintain that a very large percentage of the sales are still made through the small retailer, who must buy his supplies through the wholesaler. However this may be, there is no doubt that the system of chain store supplies is rapidly developing throughout the country. By this system one owner or company controls from twenty to several hundred shops. The improved buying facilities for such institutions are obvious, and their rapid extension throughout the country is a tribute to their sound management Keen competition generally exists between tlie rival organisation, which displays itself in their buying, equally with their selling. They desire to buy as near to the producer as possible. F.o b. sales made through various agencies have frequently boon on their account. M A I*FETING ASSOCIATION. Two other institutions not connected with anv of the foregoing, but actively engaged in handling New Zealand dairy produce, should he mentioned, namely, the Marketing Association and the London office of the New Zealand Co-operative Dairy Company. We do not propose iij this report to discuss the merits of individual firms or insti-

must inevitably move. Rotter moth-1 ods of handling cream must he en-1 forced, and sufficiently frequent deliveries insisted upon, to avoid tile necessity of this extreme neutralisation. ! BUTTER BOXES. Butter boxes should have ends of not less than Si' l in thickness. Most of the boxes broken in transit had fin ends, which had split when nailed, or the nails had not been properly driven into the wood. Tops or bottoms projecting over the sides was another freqnenl cause of damage. These easily get levered off when being handled in slings. Another cause was that of insufficient nails. We saw boxes which had only six nails in the top and bottom. Ship's officers informed us of instances of only three nails being used. The wire-bound boxes used by some districts in Australia are commended by the shipping companies, as these require less cooperage. On the other hand, no one who handles them appreciates them. The London importers consider our package easily the best., The wire-hound box enables thinner timber to be used, but being rough cut, does not compare favourably with our planed smooth finish.

We were asked if shipments should be made in tubs, to which we replied “No.” There is no doubt that in some districts, especially in the North. there is a prejudice in favour of the tub. By long usage of Danish, it is thought that all best butter is packed in tubs. We know that New Zealand butter has been repacked in tubs in Britain to meet this prejudice. We recorded from New York the same prejudice, but Americans being less conservative, a little experience has demonstrated the ad-

vantages of the box . Such recognition will be of slower growth in Britain, but considering the advantages of the box from an export point of view, we consider that the present policy of boxes only should be continued.

DATE BRANDING. This question lias been discussed with importers and others, and we consider that it is not advisable to put the date on each box. The experience of importers is that the trade will endeavour whenever possible to use these brands prejudicially against the commodity. .'Bo r instance, the South Islam! brand we have quoted, which opened up in fine condition when seven months old; would have been declared stale by reason of its date brand, and its value discounted. We consider that a system of cypher box branding should be continued so that the date can be determined when desired, but beyond- this, date branding in any form is not desirable. WHEY BUTTER. The quality of whey butter was vigorously assailed by many importers, some asserting t lint its exportation should be prohibited. One sample we examined, when freshly opened up in London, was of excellent quality, hut it is said to go off in quality very rapidly after being taken from cold store, becoming tallowy, colourless, and rancid. Branded as it formerly was, in a very similar manner to the fresh creamery butter, fraud was not difficult. Wo have seen some of the old boxes wit It the “Whey'’ planed off. Tiie decision to print the boxes with a distinctive colour should obviate this. QUALITY OF CHEESE, The chief complaint that was heard was regarding ( tie body, of our, cheese —that much of it is loose and open. This is not a newly developed complaint, it having for some, time been mentioned in New Zealand by agents of Toolo.v Street houses. This matter was considered of such importance by one agent, that before our departure lie suggested the desirability of considering whether our system of points in the grading of cheese should be revised bv giving more to “body” and less to “flavour” must remain of paramount importance, but more attention needs to he given by the makers to bodv and texture.

It seems quite.clear in some instances cheese has been kept at too high a temperature before shipment, causing it to swell and generally deteriorate. As recorded by the ships’ logs we inspected, the cheese temperatures at Wellington were much higher than at other ports. Ships' officers tell us that they have known the- temperature to be 72 degrees at Wellington. The Jogs wo inspected showed it to he from 8 degrees toll) degrees higher than other ports. We think that all cheese should be held at a temperature of 50 degrees for several days before shipment. The circulation of cool air provided for in steamers can not be as effective as desired unless greater care is displayed by some factories .in the packing of the cheese. An air space of fully lin. should be allowed for each cheese, and the cheese should be divided by a sound, well-nailed centre board fully an inch in thickness. While in the ships, cheese crates are invariably stowed on their sides, in warehouses, they are equally invariably, stowed on their ends. IT the centre hoard is not strong and well nailed, immediately the'crate is dropped on its end the centre board is carried away, and thenceforward there is no air space for the bottom cheese, which affects the top cheese by causing it to go soft in the centre at .the bottom, evidently due to lack of air space underneath. We saw some well made cheese of flavour spoiled.by faulty crates, the centre hoards of which were in some cases under iin. in thickness.it is impossible to nail sufficiently, well for this purpose any centre hoard under 1 inch in thickness, and in all cases care needs to be exercised in nailing, or it will not remain in position. To save a penny by a light centre board is false economy. SHRINKAGE.

Weighing a number of samples from different factories, we found there was considerable variation in shrinkage, as much as 281bs. in three crates. One orate from a well-known factory showed a shrinkage of 1 Llb.s., while another factory showed very little shrinkage. The stores informed us that the weights of ibis particular factory usually came out the same as the factory weigts. It is clear that they are not'each following the same procedure, and various reasons suggest closer investigation, Waxing to prevent shrinkage is generally not commended I,v importers. They nsserl that cheese does sot properly mature when waxed. We can quite believe this is correct when green curd cheese are waxed, as vve saw in America, within a few days of coming from the press. In some cold stores in Britain we saw some American cheese laid to bo turned each tiny because of the palpable swelling. Certain experiments have been made in New Zealand with waxing, and we think I lie so should be continued, by waxing after the cheese have been cool stored and is ready lor crating. This will possibly not then relay'd the maturing process, and at the same time provenl the shrinkage. RIM. On every band it was apparent that losses are being incurred by .individual factories and the industry generallv by the rim on the cheese. This unquestionably causes considerable joss to the retailers, and has to he allowed for in their purchases. We much regretted to see this fault. Many factories are now using hoops which obviate it. In cases the losses were very serious, the

flies having entered the breach, ami a large amount of decomposition had set in.” \\'e are of the opinion that in factories' own interests the exportation of cheese with this objectionable rim or lip should be forbidden. PASTEURISATION. We were asked to report upon cheese made under pasteurisation methods. We had .no list of the factories working under the different methods. In the absence of this no conclusions have

vet been formed. AYo have been informed that the difference in the product could be readily distinguished. With cheese made by each method in the same day this ■ may be readily proved, but no such comparison was available. We found considerable variations in flavour and quality between the different factories of companies with several branches. Whether they are pasteurising in some and not in others we were in no position to say. When we have checked up our notes with the companies concerned our ideas may be nearer .crystallisation. It seems certain, however, that careful study of this and allied questions needs to be continued. We sampled cheese from well known factories graded Ist in New Zealand which had not maintained its grading standard. Some of it had developed distinctly objectionable flavours. which led us to wonder where a market was found for it. Is this an outcome of the feeding methods employed? We noticed some difference in flavours of butter from different parts of the country, although they were not objectionable, as were the cheese. These injection able cheese flavours must have ievcloped after grading, for the gen--Anl hiali level work done by our grading officials is acknowledged by all in the trade, in London. These matters require full and careful investigation. CHEESE FROM JERSEY MILK.

The butter-fat content of cheese made from Jersey milk is a matter which needs to be mentioned. Theoretically die cheese should secure a better price. Vctually we see no’prospect of it doing 50. The tendency sometimes observed, when temperatures are high, for the fat to exude, lias been used as an argument against its quality. Cheese >f this character that had been kept in ordinary storage during the early months of last summer in London generally looked less inviting than cheese with lower lmtterfat content. In the Middle-West of U.S.A. we found them talking of standardising milk for ■■bee.se manufacture, evidently because they now have breeds of cattle' producing a higher percentage of Imtterfat than formerly In Canada there is mo need to talk of. standardising fat, he Friesian cow being almost in/ariably used, and ibis becomes their standard. In Holland anti Denmark they skim more or less most of the milk used for cheese making, few of their ordinary cheese-' containing as much fat as the poorest of New Zetland,- while the practice of part ~kironing is bv no means unknown in cheese n a king districts in England. In Canola a prominent, authority remarked to is that Lake Sr John, in North Queiec, make the best cheese in America.

t is made from milk averaging 4 per ■cut. of fat, tint they get no better nice lor it. Most of the cheese imlorted by Britain is consumed in the oiliery and industrial districts, a clean •utting, good quality being required, ’art skimmed cheese have been made in 'lew Zealand, but in all cases bad to be labelled as such. Under such an inleCmite label many questionable parches might- develop to Ibe detriment if New Zealand’s reputation. The itnndardisation of all-milk cheese makng is worthy of full consideration. ADVERTISING. There is no doubt that our display it the Exhibition has been fruitful to die industry. The displays of butter and cheese were well conceived and

carried out. and promoted widespread interest, in New Zealand products. The mtter sold in cartons led to continued epeat orders and frequent inquiries as ;r> where such butter could be bought ehrpughout- the country. The Exhibition cheese was also a great attraction, and the weight-guessing competition organised in connection with ther attracted considerable attention. The increase of the sales of butter in cartons at the .Exhibition, together with i_ similar experience, reported by the N'ew Zealand Co-operative Dairy Company with their “Anchor”- brand, inlien te public appreciation of this form. With the closing of, the Exhibition’ nd the suspension of our selling, our only course in endeavouring to maintain this interest .in cartons was to recommend the “Anchor” brand. It seems to have been decided to reopen the Exhibition next year. New Zealand, it was understood, had derided not to exhibit again, but possibly in the meantime the decision has oeeu reviewed. Our own opinion is chat, as cabled to you in reply to your inquiries, if the Exhibition is reopened we should certainly exhibit. If the Board undertakes the systematisation of supplies, as we think it must do, participation in the Exhibition next year year should be of great value, a scheme in, the meantime being developed for the distribution of supplies throughout the country as New Zealand, following upon the organised propaganda of the Exhibition. We recognise that great care must be taken in the conduct of a specialised carton business. The quality must he irreproachable. The central point in all our. advertising propaganda must he to get New. Zealand in the minds of the people. It will he a long time before all our produce is sold as New Zealand, but with persistency the public can he got to think of it as they now think of Danish. We have examined several schemes submitted,, by advertising experts, hut consider that no extensive scheme should he undertaken until the supply has been systematised. In the meantime useful work can he done iti the promotion of the New Zealand idea by a supply of up-to-date films of the industry, which, if well taken and nicely arranged, could he shown at theatres throughout the industrial districts at very little cost. 'Wo question if an equal amount of money spent in any oi lier way would produce a tithe of the I results. A liberal supply of good, up-to-date lantern slides are also required by the High Commissioner’s office for the vise of lecturers about the country. BLENDING. There are a number of blending establishments in different parts of the country which in the aggregate supply a large quantity of butter to the British consumer. There is little doubt that if is a highly lucrative, business. Different varieties are purchased, dry butters being always preferred owing to the additional amount of moisture ,that can be incorporated, flit* aim being to secure a fairly even character of butter throughout the year. In our experience il is usually of a mediocre quality. Considerable quantities of New Zealand are used, usually to tone up inferior qualities, but quite naturally the price factor must always lie borne in mind by the blender. These blenders usually have a line distributive organisation, making deliveries of small quantities into even remote districts several times per week. Each blender lias a particular brand printed on the wrapper, while if the blending establishment is situated in a country

district, such as Somerset, or Devonshire.* tiie wrapper will also hear the place name, the implication being that it is English butter, although it is almost invariably of outside origin. This position will have to he accepted until the public have been induced to require a higher- level of quality, and arrangements are made to supply it regularly in tiie same form. MARGARINE. Estimates of the annual consumption of margarine vary between 3500 and 5000 tons. There is a considerable difference of opinion as to the effect upon its consumption by high prices of butter, one firm with probably the largest retail trade in butter and margarine in England asserting that the price of butter has no appreciable effect upon the consumption of margarine. while others assert that 25 per cent of the margarine trade fluctuates between it and butter, according to price levels. It is certain that the consumption of the large amount of low-grade margarine is quite independent of tiie butter trade, much of it being used for cooking purposes. BUTTER BOX SUPPLIES.

We -are informed that very large quantities of timber exist in Sweden suitable for butter box and cheese crate making, samples of which have been purchased for New Zealand. As reported in previous letters, we interviewed the London agents of the Torroba Box Company, which is reputed to turn out the best box. Present conditions are that the boxes can be delivered in New Zealand at a favourable price, and that any quantity can be supplied for next season’s requirements. Another firm was to submit quotations and particulars. Possibly these have been sent direct to you. L'he minimum quantity to secure a boat for direct shipment, we understand, is 300 standards, which equals 1.70,000 boxes. Present freight charge is 1.50 b per standard, which equals about 3 1-od per box. Price quoted c.i.f. New Zealand ports, Is 2Vd butter, 2s 0 2-3 d cheese.

Dealing with the countries visited, there is little to add to our published reports regarding America. Recent experiences have again proved the XJ.S.A. to be a highly speculative market. The large quantities of butter which wo reported were being bought tor cold storage proved to be far in excess of requirements for the present winter. During the concluding weeks of our stay in England. butter prices having risen to a high level, American stored butter was freely offered to English merchants. Very little was purchased, however, merchants generally considering that its quality would be unsuitable for British requirements. During our subsequent visit to Denmark we found that some of this American stored butter was being bought by Danish merchants. Of the avenues through which this would ultimately reach the consumer we knew nothing. ■SHIPPING!.

Having been given the responsibility of making the first. contract for the board was sufficient justification for a complete examination of the whole circumstances and conditions under which, previous contracts had been made. The possibility of tbe establishment of a specialised service for the dairy industry of fully refrigerated fast steamers, calling at a limited number of ports was investigated. Details of these matters and of the’ prolonged negotiations in connection with the present contract are contained in the confidential report submitted. 1 hese together with the matters the bondon combined shipping companies desired us to discuss with the local ■shipping Committee should engage ■■oui- earnest attention. Future shipDing arrangements must largely depend upon the decisions on these matters.