OTAMA DAIRY FACTORY COMPANY.

Mataura Ensign, Volume 9, Issue 642, 11 February 1887, Page 5

OTAMA DAIRY FACTORY COMPANY.

PKOPOSAL TO SELL TO A PRIVATE FIHM. A fairly representative meeting of the Otama lJairy Factory Company was held last Tuesday evening in Mr W. D . Stewart's barn "to consider a proposal from a private firm to take over the Otama Dairy Factory Company, Limited." The company was only registered a few days ago, and at the date of the meeting no other expense of consequence had been incurred. Mr John Chisholm, the Chairman of Directors, occupied the chair, and read the following letter :— We, the undersigned, make a proposal to the directors of the Otama Dairy Factory Company to erect and carry on a factory near to their proposed site on the following terms : — Payment to be made at the rate of 4d a gallon of lllbs for the first and second months, and aflex that in the event of cheese falling below s£d f.o.b the price of milk to fall at the same rate per gallon as the cheese falls pet* pound. In event of cheese rising nbove 5Ji per lb. f.o.b. the price of milk to rise at same rate per gallon as cheese does per pound. Threepence, say, per gallon to b'j paid at tbe end of each month on account, a-d balance as tbe cheese is sold after milk supply stop?, but in any case the balance payments to be completed not later thaa the last day of June. The pHce of cheese to be ruled by the average of prices obtained for season's m-»ke by the leading factories of Otago and Southland. Aiitiiw Wayte, Bmjjjamin Watte. T tit was the proposal, and for his own , art, he was inclined 10 leok favorably upon its rx'iepting that port'on which stipulated 'hat 11 lbs cf milk should be regarded as a galioa. Ten pmnd.s w»s the usual thing. That quantity usually produced a little over a pound of cheese, and as it cost Id a pound to make the cheese and take it to m irket the promoters would a<; 10 lbs have £d to Qouie aud go on. He had been reading au authority on factories.

That authority said 9ißoibß ofmilk_waats sufficient for a pound of cheese. This g extra pound would really mean three- j eighths of a penny less per gallon jro| t their milk. ' ] Mr A Stewart believed some j factories stipulated 11 lbs to the' gallon- l — Fairfax for instance. < Mr Dodds aaici the number of jjoundq ( would matter very kittle ;if the j£acin&s 1 had the factory in their own hands, \ but when it was in the hands of a , ] private firm the position was materially ; altered. T i In repiy to Mr G W Woods, ; The Chairman said that in the event \ of a sale the company need not be 1 * wound up. There would be a small ] call to meet preliminary expenses, and then things could remain as they were. 1 Mr Dodd? said the greatest difficulty ( in coming to an agrement would be the 1 weight of the milk. He thought the firm would get the better of the company if they agreed to 11 lbs ; besides, how would the farmers .fare in the hands of a private firm in future years ? Mr McKenna contended that the farmers would hold the balance of power. In any case the firm would hold a building which would be useless unless for cheese and butter-making, and it was likely they would meet their constituents in every possible w«y ; if they did not, there would be the risk of another factory being started. Mr L Gillespie feared that a combination might keep down the price of milk. Farmers as a rule would nol com'»ine to enter into active competition with a private firm. The Gore D.*iry Factory might some day fall into the hands ot a private firm, and then a powerful combination could be established. Mr J White urged a sale, which wuld rid the farmers of a deal of responsibility. Mr Dodds spoke of the profits that would accrue if the company went on with the thing itself; and Mr A Stewart spoke of the possibility of ckeese falling in price. The Chairman said both the Wyndham and Woodlands factories paid handsomely last year, and»he failei to Bee that the position was a bad one now, for this reason : There had been an exceptionally favorable season for grass in Australia this year. Oats were a drug there, so was cheese. If the season had been an average one, no doubt the cheese market would have been as brisk now as it was last year. He was not at all disheartened by recent reports. The price of cheese would fluctuate, and if the share** holders and the firm could agree on the weight of the milk per gallon he thought the outcome would be satis, factory to both parties. A pennyfarthing would be a very good thing for the firm, and he did not think cheese would ever fall so low as to make it unprofitable for the dairy farmers of the district to supply milk. Mr Andrew Aitken (Gordon) thought the firm looked ahead. The district was a good one, and they saw that a factory would pay well. Would it not be well, therefore, for the Company to consider the desirableness of carrying on ? he saw good prices for milk suppliers and good dividends for shareholders in the near future. The Wyndham factory had succeeded remarkably well. A .desultory discussion ensued as to future price of milk and various other points, and during it the Messrs Wayte, who, with Mr S. M. Bobbins had been inspecting suitable sites for a factory, arrived. The Chairman (addressing them) said the meeting appeared inclined to look on their proposal favorably, but could they not see their way to accepting lOlbs as the weight of milk per gallon 1 Mr A Wayte said tha*. would make a considerable difference, and in view of the present position of the Wyndham Company his firm could scarcely bind themselves to pay 4d a gallon of lOibs for part of next season. This season the ruling price of cheese was sd, and, if this was maintained next year, for two months they would be giving 4d a gallon for milk and getting only 5d for their cheese. " F.0.b." meant and there would be only left to run the factory on. The Chairman said the meeting had been under the impression that l£d should cover all expenses and leave a margin of profit. It seemed that most of the factories stipulated lOlbs only to the gallon. That at Gore did, and the milk from Otam* would certainly not be infer o * by comparison with that of Gore. Mr Dodds had no doubt the Company could make a factory pay. He had gone into figures, and had come to the conclusion that in such a good district as Otama cheeseratking would be a paying affair. The company were quite able to put «up a factory and run it to advantage. If they sold to a private firm they wanted a gallon called a gallon : if not next season, then in future years. In reply to the Chairman, Mr A Wayte said that if the milk supply exceeded their expectations they would probably be prepared to consider a proposal for a reduction in the weight per gallon. Tuey did not expect the eupply next season would exceed 1000 gallons. The Chairman was not sanguine as to the milk supply increasing rapidly. There was a great want of cows. He thought 800 gallons only would be reached during the first season, and the expense of dealing with th t would be nearly as much as if 1000 on 1200 gallons were dealt with. Messrs Bruce and Carroll moved — *' That the offer of the Messrs Wayte be accepted and that the directors be empowered to ace the matter carried out." The Chairman pointed out that the farmers would only be bound for ota year in case they accepted the offer. Messrs McKenna, Aitken and Kennedy spoke in favor of the proposition, which was eventually put and « carried unanimously. J Thereafter a meeting ot the directors

'wa^kield^fcwfa J chntber'MeHßrsrWay tn= agreed to proceed .with. ;the factory at an early date ; in case oF failure on fch'eir part to do sW they are" to lose LSO deposited by them with the Com pany's banker as a guarantee of their bbna fides. Necessary agreements' werfe' ordered to be drawn up anß, signed,, and the Messrs Wayte intimated that, after : conference with Mv JRobbirisJ they desired to place thfl factory on, Mr .[MoNab's property, hear Mr Baxter's. In case they, failed to spcure tbat, they would willingly. accept, MrBaxter's offer of a free site, and would treat with him for sufficient land near the factory on which to erect a residence. Mr Carroll apologised for the absence of Mr Bobbins, who had been compelled to return to Gore after inspecting proposed sites.