THE DAIRY FARMER AND THE PREFERENTIAL SCHEME.

Hawera & Normanby Star, Volume XLVIII, Issue 8098, 29 September 1904, Page 2

THE DAIRY FARMER AND THE PREFERENTIAL SCHEME.

We referred in a previous issue to the inclusion by the London Times in its review of tho last season's colonial dairy produce market of some remarks on Mr Chamberlain's proposals to give preference to colonial producers and the possible effects on the colonial dairy trade. On closer examination we find that the observations are not those of The Times, but a quotation from Messrs Weddell and Co.'s review of the market. They form an argument against the practicability of preference, and this is a view which is hardly in accord with The Times' opinions. That journal is giving Mr Chamberlain a general support, and believes that in its main features the preferential system is feasible. Certainly, if it is not feasible in respect of dairy produce, so much of which now is sent from foreign countries, and so much more of which might be sent from the colonies, then we do not see what the colonies are likely to gain from the proposed fiscal revolution. In this view of the matter it is of especial interterest to hear what a firm largely interested in the trade has to say. The report sets out tables of figures to show from what sources the Mother Country draws her supplies of dairy produce, and the deductions drawn therefrom are, firstly, that Great Britain is hopelessly unable to supply her own necessities and next that even the help of the colonies is altogether inadequate to make up the deficiency, so that in the present circumstances and until the Mother Country or her colonies can enormously increase their productions, foreign countries must be drawn upon no matter what the cost or what the artificial obstacles created, the only alternative from this being the deprivation of thousands now using fairly cheap produce. Then the review proceeds : "In 1895 the colonies supplied 14 per cent of the total consumption, and for the year ended June 30, 1904, their supply was 24.8 per cent. It is true if there had been no drought in ,Austraila during this interval the percentage in 1904 would have been greater. 'In the matter of butter, the* colonies in 1894 supplied 8.3 per cent., afld for the year ended June 30 last the supply had risen to 14.7 per cent. In the supply of cheese the colonies (virtually Canada alone) contribute a very large bulk, and a glance j at the progress made during the past decade shows that without any artificial preference they are slowly but surely securing for themselves the import cheese trade of the United Kjuagdom. In 1894 they supplied- 23 pel cent., 0r* 61,6^ tops out of a total consumption ot 264,800 ions, and for the year just ended their supply rose to 35.5 per cent., or 102,435 tons out of a total consumption of 288,662' tons. This country, having a steadily-growing ' demand for dairy produce, which cannot be met with the almost stationary home production nor by the slowly-expanding colonel QjUtput, .cannot possibly shut out ox lessen fti jfowi|sn supplies (34.6 per cent, of the whqle) .witWty certainly raising their cost and that of the remaining 65.4 per cent. In fact, some rise, resulting from the duty being imposed, must' take place in this market before colonial shippers can obtain any cash value in respect of the handicap proposed to be placed .upon their competitors. Mr Chamberlain says the foreigner would pay the mfcip part ofjtjhe 5 per cent duty, but,il «>, tfyj juice o/ Jorisign dairy produce

tangible preference. Any preference to i colonial dairy produce can be secured only ' through that perpetual competition which | exists in ail markets, and the preference can only exiat so long as colonial dairy produce quality for quality undersells the foreign. Unless the preference raiseß the price of colonial produce, what advantage will it be to the colonies? British markets have, for many years, been able to absorb all the butter and cheese they have been able to send us, and this power of absorption will continue to exist in the future. Should the .duty raise the price of foreign the whole 5 per cent., or only part of it, then there might be an inducement for the consumer to prefer, by reason of its lower price, the colonial to the foreign. But as the supply of colonial butter and cheese could not by any possible means for many years to come meet the transferred demand, the price, in consequence, would quickly rise until it was equal, or superior, to that of the foreign, and when this happened -the effect of the preference would be totally destroyed, and the original relative prices and conditions of the market restored — with this difference, however, that the consumers in the United Kingdom would have to pay more money for the same amount of butter than they did formerly. These higher prices would reduce the demand, less butter would be consumed than formerly, and thus the colonial dairy produce farmer would suffer equally with the foreign and the home producer, and the colonial trade would not in the future expand at the same rate as it has done in the past." The questions raised in the foregoing extract show some of the practical difficulties tn the way of a preferential tariff, and help to explain why it is that a scheme which out here appears to be so attractive is making very small headway among the working classes of the United Kingdom. And then we get back to the thought that if preference is not to benefit the colonial dairy farmer who will it benefit, and why should the farmer be taxed by a local preferential tariff?