STRANGLED BY SHIPPING.

Hawera & Normanby Star, Volume XLII, Issue XLII, 25 March 1922, Page 3

STRANGLED BY SHIPPING.

CHARGES THE CHIEF TROUBLE.

MR W. GOODFELLOW OPTIMISTIC. Dealing further with the marketing of New Zealand produce, Mr "W. Goodfellow, managing director of the N.Z. Co-operative Dairy Company, who returned to New Zealand by the Ulimaroa on Wednesday, after a tour of Europe and America, speaking to a Waikato Times reporter, said that before leaving London he opened an office in Tooiey Street, right in the centre of the dairy produce houses, with the object of getting into close touch with the marketing conditions. In Mr J. B. Wright, 0.8. E., who had accepted the position of European manager, they had the services of an exceptionally able, dependable, and experienced man, trained in Glasgow. Before leaving .London, a definite price-fixing scheme j had been established, which, if extended to embrace other co-operative companies, would effectually prevent speculation in consignments of dairy produce in. futine. How Market was Broken. Mr Goodfellow considered the merchants' scheme almost useless in the recent crisis. The result would have been that the New Zealand and Axis-" tralian Governments would have besome owners, instead of the Imperial Government, without effecting any improvement in the market. An atterna- j tive scheme was agreed to by a group of merchants. It was decided to ask the New Zealand factories to endeavour j to arrange with Mr Massey for a joint ; purchase on behalf of the New Zen.-] land Government. This suggest ion was I promptly acted upon in New Zealand, | and would have been an excellent deal, | as it would have established a bottom for the market and a bij£ profit would have resulted. However, when it became known pTivately in London on January 6 that the New Zealand Government would accept the joint account purchase scheme, certain merchants immediately got busy and within three days, before information arrived, the

whole of the remaining stocks of New Zealand butter had been purchased from the Board of Trade at riom 110s to i!3s per cwt. (Shortly afterwards the whole of tha Australian old stocks were likewise disposed of. Although this 20 S <JOO tons of old butter had been sold by the Board of Trade in a tew days yet, obviously, the butter was still in London, and had to go into consumption. .Prices advanced rapidly, and new season's butter was soon up to 130s and 140s per cwt again/ but never regained its true value owing to the December slump. No Effective Control. The weekly consumption increased from 2500 to 4500 tons in Great Britain, resulting in temporary stagnation in the margarine industry. It was estimated that approximately 200,000 tons of butter and 400,000 tons margarine were consumed in Great Britain last year. The best butter would sell at double the price of margarine, but the best margarine was preferred to inferior butter, thus the imperative necessity for exporting a high-grade article only. Had h* or some other person had powcx to fix the minimum prices on, say twothirds of the New Zealand butter, a great loss would have been obviated. As it was the butter exported by the iN.Z.G.D.C. only represented onc-thiru of the total, and was not sufficient to give effective control. New Zealand and Australia did not pay nearly suf- . ticient attention to the marketing of primary products. It was a deplorable fact that in U.S.A. for instance, the great superiority of New Zealand produce over Australian was not recognised. To the American buyer New Zealand was simply Australasia. What was wanted j was a national campaign to advertise ,-. -New Zealand foodstufis —not any par- • ticular company's brand, but New Zenland goods. Denmark and Sew Zealand ! were the only two countries in the world j making superfine dairy produce m quantities. In both countriesa great I deal had been dune by the Governi ments by grading and "instruction, but j the success of the industry in each | country was mainly due to co-operative i effort. In no ether countries had tht-. industry reached such an all-round high state of efficiency.

Wages. Must Come Down. [ J>ealing with the future, Mr Gootifellow said there was little doubt that Great Britain would be able to take all the dairy produce offering for mwy years to come, but nevertheless thi markets f^'jlu *?• developed. Siberia not be an exporter again for | possibly 40 years; that country was in a deplorable condition. Prices, too, were likely to be satisfactory for thu best quality butter and cheese. Tlie price to-day was not so bad, but the expenses were the trouble—wages, coal, shipping freights, and charges were all too high. Wages in New Zealand would have to come down with the reduced cost of living. Inflated waggs could be- , paid out of inflated prices, but these ' were now a thing of the past. In Engi land wages were coming down steadily, < and in consequence the coet of living was falling. Hit by Shipping Freights Touching on the question of shipping, Mr Goodfellow said shipping freights were of vital importance to this country. At present our people were being quietly strangled with high outward ana inward freights. They were, in fact, hit both ways. The freight on dairy produce, for instance, was 100 per cent, above 1914, and in the case of skim milk powder, his company had recently paid at the rate of £15* 10s a ton weight, as against the New York-Liver-pool rate of £3 10s a ton. How on earth, he asked, could we compete under such conditions ? There seemed to be only one remedy, namely, competition. The Australian Commonwealth, had agreed to admit German goods, which, of course, meant German shipping competition. The sooner New Zealand adopted the same course the better for everyone. England was buying shiploads of German goods—in fact the German hotels were full of British travellers buying goods. Why should not New Zealand, therefore, buy direct and get cheap goods? Besides, Germany would buy raw material and foodstuffs in return. There was, he added, very little sentiment aboiffc German trading in Great Britain, where it was recognised that the indemnity would have to be \ taken out in goods.

No Cause for Pessimism. There was no cause to be pessimistic regarding the future of the dairy industry in New Zealand, according to I the opinion of Mr Goodfellow. No doubt the producers were having a hard time, pending the readjustment of world' values, but nevertheless they had a lot to be thankful for. Trade moved in cycles of depression and expansion, and we were now round the worst corner of the greatest slum in dairy produce in the history of the Dominion. The future, he considered, was full of promise for those who would economise and stick to their farms, and not lose heart, for after all this depression was not peculiar to New Zealand alone, but was world-wide. The dairy'farmer? should not imagine they were the only people who had been hit. The whole world was staggering, and New Zealand would-be | one of the first countries to recover.