The MANAWATU DAILY Times TUESDAY, JUNE 2, 1936. Butter and Cheese

Manawatu Times, Volume 61, Issue 128, 2 June 1936, Page 6

The MANAWATU DAILY Times TUESDAY, JUNE 2, 1936. Butter and Cheese

The announcement by the Acting-Director of Marketing, Mr. U. A. Duncan, that payment for cheese under the guaranteed price scheme for the coming season will be lid above ihc price to be paid for butter on a butter-fat basis will be welcomed by cheese factory directors who have been'showing signs of nervousness lately because of the fear that the return from the prices paid for the two articles would work out to the detriment of cheese factories and as a result their suppliers would desert to butter.

The position of the dairy produce market at Home is just now certainly most cheering, but its very buoyancy may contain elements of trouble for the newly-appointed Minister for Marketing. The latest reports show that finest New Zealand butter has reached 104 s—-a rise of about 6s in a week—and there are signs that the price may go still higher.

There is no need to look very far for the cause of the rise. An examination of the movement of the prices of our dairy produce throughout the year shows that the peak is nearly always reached in our off season; September or even October often shows the highest figures. The stocks in London are tow and the amount of butter in the freezing works in the Dominion and in transit is known. We shall have no export surplus during the next three months.

There is therefore no uncertainty as to the amount that cau come on the market. The vendors of New Zealand butter have to provide customers with our butter all the year round and must make sure of supplies for the coming months. With the small amount in store in London the natural course is for prices to rise. While the rise is certain it is impossible to tell just when it will take place or how far it will go. It depends on consumption and how far people turn over from New Zealand to English or Continental butters which are freshly made.

A good deal of English factory butter and cheese is now manufactured and the Milk Board is building many dairy factories which will gradually take the place of farm house butter and cheese making. Dairying is advancing owing to the improved conditions under the Milk Board. In March this year milk production increased by 2,000,000 gallons over last year and more than this amount was manufactured, as sales of liquid milk fell by 500,000 gallons.

Notwithstanding these factors the statistical position is much more favourable to-day as compared with a year ago. If the price of butter holds at its present level, or goes higher by August 1, the Government will be in rather an awkward position. The farmer has been led to expect something more than the market price for his produce under the guaranteed scheme. If dairy produce on August 1 stands at a figure equal to that which the Government has had in mind—the average received by the industry over the last eight years—will the Government still fix that price for the season’s pay-out? And will the farmer be content with that return? If, however, the price on the London market is higher than the proposed guaranteed, price, what will happen? Will the Government deduct the difference? Such a position would be Gilbertian!