PRIMARY PRODUCTS.

Manawatu Standard, Volume LIX, Issue 21, 23 December 1938, Page 9

PRIMARY PRODUCTS.

MARKETING OPERATIONS. WELLINGTON, Dec. 23. Figures published in the annual report of the Primary Products Marketing Department show that the trading operations of tho Internal Marketing Division for tho 14 months ended March 31, 1938, resulted in a net profit of £6804. As the division was established on February 1, 1937, no accounts were issued at the end of March that year. Tho report reviews the activities of the division for the 14month period, special sections being devoted to tho various commodities over which it has control. It is stated the division has made considerable progress in stabilising the markets in various primary products. Referring to the local marketing of butter, the report says:' “Methods have been instituted for stabilising prices and regulating the marketing and distribution of butter within the Dominion. Using as a working basis the experience gained through the administration of the Butter (Wellington District) Marketing Regulations, which came into force, on May 1, 1937, the division inaugurated on November 1, 1937, regulations with a complete New Zealand coverage. The scope of the regulations included fixing tho local ■wholesale price in relation to the guaranteed price ruling from time to time and ensuring that returns to dairy companies for their local sales were, as nearly as possible, equal to. the export parity after making allowances for such items as patting, transport, handling. _ “Export parity is determined by adding to the guaranteed price obtaining at any tinie the extra costs involved in preparing butter for the local market and then deducting the amount of the savings effected -through not placing the butter f.o.b. Tho resultant figure is then known as ‘export parity.’ Licensing of wholesale distributors, conditions of sale, and distributive margins have been determined. DIVISION OF ZONES.

“The effect of the regulations has been to eliminate a practice which in the past has been the cause of much unnecessary expenditure by the dairy industry. The local market has been divided into seven zones or areas within which under normal contions, the supply of butter manufactured is sufficient to meet the demand, and manufacturers in one marketing district are not permitted to forward their butter into another district without permission in terms of the regulations. ' '

“Previously, the whole of New Zealand was an open market for every manufacturer and much unecomonic transfer of butter took place, particularly! from the northern portion of New Zealand to southern markets, for the purpose of capturing markets in other areas. Apart from the unnecessary haulage costs, this practice was the cause of market disorganisation. The division has, of course, made the necessary provision for supplying butter to areas which, in their period of low production, are unable to manufacture sufficient butter to meet their local demand. This has been done in the most economic manner possible, after an investigation into the relative costs of storage and transport.” The report states that New Zealand is well known for, its comparatively heavy consumption of meat, and this no doubt has a considerable bearing on the small amount of cheese consumed. This, it is stated, could be increased with advantage, and the division is accordingly working on a plan to this end. The marketing of eggs and egg-pulp, honey, fruit (local and imported), maize, hobby calves, and kauri gum is also referred to in the report.

“Trading activities in primary produce carried on by the, trading branch at Tliorndon Quay, Wellington, in conjunction with a depot at Palmerston North, have been successfully operated during the vear in competition with other distributors of similar lines, and a satisfactory monthly trading surplus has lveen maintained.” states the report. “Sales turnover in all lines has been kept up, particularly with eggs, honey, cheese, and milk-powder.”