FALL IN BUTTER PRICES.

Hawera Star, Volume XLVII, 30 December 1927, Page 10

FALL IN BUTTER PRICES.

CHEESE MARKET SATISFACTORY

VIEWS OF MR. W. GOODFELLOW

The reasons for the recent drop in the prices of butter on the London market are discussed by iMr. W. Goodfcliow, managing-director of tne New Zealand Co-operative Dairy Company, Ltd., in his monthly market review to suppliers of the company. During the past four weeks, states the review, the London butter market has again shown a further decline, Mr. J. iB. Wright, London manager for Amalgamated Dairies, Ltd., had given the following reasons for the recent unexpected drop: (1) Continued absence of demand: (.2) large anticipated arrivals and stocks being cleared promptly; (3) old butter being forced on the market.

No doubt, continued Mr. Goodfellow, speculators were endeavouring to quit all old stocks containing preservative prior to th e operation of the new Act prohibiting the sale of preservatised butter, which would come into force on January 1, 11)28. It was also apparent that on account of the Australian recovery importers in London were selling freely with the object of preventing an accumulation of stocks. Mr. Goodfellow said the statistical position was excellent, but as large buyers were not operating extensively ' the market had been very weak. This afforded just another instance where a combination of buyers could easily defeat a multitude of independent sellers. Mr. Goodfellow said during the last year or two New Zealand had benefit- j ed considerably as the result of unfavourable seasons in Australia, but with a return to normal production in that country, New Zealand producers must be prepared to accept a lower range of prices. When this fact was realised by the New Zealand dairy companies, MV. Goodfellow lroped they would appreciate the imperative necessity for a combination of selling interests.

The New Zealand Co-operative Dairy Company, Limited, had again given the industry a lead by the formation of Amalgamated Dairies, Limited. Mr. Goodfellow said the new organisation had been very well received. If the present competition among sellers was to be prevented and the maximum return received for the dairy produce of the Dominion, dairy companies .must |e;ther link up with Amalgamated Dairies, Ltd., or form other similar organisations. Without rigid London con- | trol of sales and prices, the speculator and the multiple shop buyers would always be able to manipulate the market to the disadvantage of the producer.

CHEESE POSITION 'SATISFACTORY .Referring' to the cheese market, Mr. G'r.odfellow said cheese was being 'quoted at white ids, and coloured 90s, [which, all things considered, must be regarded as satisfactory. No undue fall in the price was likely to take place for some months. As he had pointed out previously, the Canadian production of cheese was substantially less this year than normally, and this was leaving a very desirable effect on the price of cheese in Great Britain. The casein market, said iMr. Goodfellow, remain firm. Further s ales of lactic casein had been made to Germany on the basis of £7O a ton, e.i.f. Hamburg, January-February shipment. The Argentine market also remained firm, and the company’s casein suppliers could be assured of a very satisfactory price for the current season. 'Normal conditions prevailed in the milk market, continued Mr. Goodfellow. 'Competition with Holland and Canada had been very severe, but, notwithstanding this, the company’s sales in Great Britain for October and Nocember had been practically the same as last year. As the result of protracted negotiations the company had been recently jinformed that the New Zealand Government had completed satisfactory tariff arrangements with Germany which would result in the removal of the excess duty of £l7 a ton imposed •on New Zealand powder as a counter- j jblast to the previous action of the Government- in neutralising the importable of German goods into New Zealand. Prior to the imposition of this excess duty, which amounted to 2d a pound higher than that paid by any of the New Zealand Co-operative Dairy Company’s competitors in other countries. the company had succeeded in building up a highly satisfactory market for skim milk powder in Germany. Sales had amounted to from SOO to 1000 tons annually, and although it was a omit two years ago since this trade was lost. Mr. Wright had expressed trio opinion that the German market would prove a very valuable outlet for any surplus powder which the company was unable to dispose of profitably in Great Britain.