A Lesson for N.Z. Dairy Farmers

Manawatu Times, Volume LII, Issue 3540, 23 February 1927, Page 6

A Lesson for N.Z. Dairy Farmers

A report submitted to the Council of the Co-operative Butter and Cheese Factories’ Association states that the gain to Australian dairy-farmers from the Paterson stabilisation plan has been approximately £2,000,000 for. the last twelve months. The successful working of this scheme and the substantial benefits arising therefrom to dairy-farmers have received general and favourable comment. Although not applicable to the New Zealand butter and cheese production, a suggestion, well worthy of every consideration, has been made by the “New Zealand Dairyman” to organise a similar scheme for the New Zealand pig and bacon industries, it is contended, that an export bounty for pork would encourage export, stabilise prices and gradually make the pig industry one of the premier! of New Zealand’s primary industries. Explaining the Paterson, plan, the "Dairyman”, says that the scheme, in brief, consists of making a levy of Id per lb. on all butter A manufactured throughout the Commonwealth. As about two lbs. of butter are consumed in Australia to every one pound exported, ,the, one penny per lb, collected on the whole of the output is sufficient to pay threepence bonus on every pound exported. The immediate result of the scheme was that local prices of butter rose threepence per lb. above Londpn parity, increasing the Australian dairy-farmers’ return by two million pounds sterling per annum. The actual effect of the working of the Paterson plan is that it places the price of Australian butter on ah “import" basis instead of an “export” basis as before, while a protective duty guards against the undue importation of New Zealand butter. • _ Unfortunately, continues this paper, our small domestic consumption and large export trade make the practicable application, of the scheme unsuitable for our butter and "cheese industries, but a Paterson plan, with slight modifications, would prove an undoubted success in the New Zealand pork and bacon industry. An export bounty paid, on all pork sent out of New ZealandT would provide the stimulus required to raise this industry out of the rut where, lack of competition and periodical over-production has placed it to the detriment of the producers. It would stimulate export, encourage production, and stabilise prices to an extent no other measure could accomplish. What'is, more, the conditions prevailing in the New Zealand pork and bacon industries are particularly favourable to the application and successful working of such a scheme. - The “Dairyman” states that the approximate quantities of pork, bacon, and ham produced in New Zealand during last year amounted to 53,000,0001b5. Of this quantity approximately 5,300,0001b5. or 10 per cent., were exported. A levy of five-sixteenths of a penny per lb. on the whole of the pigs killed would produce approximately £70,000, and would be sufficient to pay an export bounty of threepence per lb. on all pork' and bacon sent out of the Dominion. Instead of the price being fixed by the New Zealand supply and demand as at present, the immediate effect of such a scheme would be that the price of pork in New Zealand would assume London parity plus the export bounty of threepence per lb., thus assuring the producer a reasonable profit on his cost of production. The tremendous and highly obvious benefits to be derived from such a plan, and its successful working during the last twelve months in Australia, make one wonder why such a scheme has not yet been introduced in an industry which is so obviously languishing for the want of adequate export facilities. There can be no question as to these benefits from the producer’s point of view. An increased price of threepence per lb. means an additional return to'the dairy-farmer of approximately 40s on every pig fattened, a stimulus to the industry which can hardly be over-estimated. We feel convinced, concludes the “Dairyman," that it will require a scheme of this kind to place the New Zealand pig industry on a sound and profitable basis.

The voluminous correspondence in reply to the above article, as published in the recent issue of the “New Zealand Dairyman,” may be taken as an indication of the importance attached to the pig industry by the dairy-farmers. If such a scheme is practicable—and we cannot see any reason why it should not be—an export bounty on pork ,on similar lines to the export bounty on Australian butter, should prove of incalculable value to the New Zealand dairy industry. The ever-declining prices for butter and cheese make it imperative that the average dairy-farmer must, look for an additional source of revenue and there is none which holds out greater inducements than the pig industry. It seems to us that the New Zealand dairy-farmer could learn from his Australian colleague.