The Times TUESDAY, JANUARY 17, 1939. Decline in Dairy Production

Manawatu Times, Volume 64, Issue 13, 17 January 1939, Page 6

The Times TUESDAY, JANUARY 17, 1939. Decline in Dairy Production

While the Government is at the present time developing a policy of increasing the production of secondary industries, New Zealand is threatened with a serious setback in primary production, caused mainly by the Government’s policy. The position thus created must be causing a good deal of concern in the inner circles of Cabinet, for the simple reason that the loss in one direction will offset any gain in the other. No very great knowledge of the economics of production is necessary to understand that the most profitable form of production is that which comes from the development of the country’s natural resources, and when there is a continued decline in one of the two most valuable sources o| the nation’s wealth, urgent action is necessary.

During the 1937-38 season the production of butter and cheese dropped by 6J per cent, from the record figure established in 1936-37, and the current season to date has witnessed a further development of this ominous movement. To be quite fair, not all the blame for tho setback should he placed at the door of the Government’s policy. The after-effects of last autumn’s facial eczema epidemic, coupled with a cold and comparatively dry spring, seriously affected dairying returns during the opening months, so much so that the season’s shipments of butter up to the end of October represented a fall of 25 per cent. Some of tho lost ground was made up during November, but now there has been a further setback, with exports of both butter and cheese for the first five months of the season showing a decline of nearly 16 per cent. The fall in production has now continued almost without interruption for 12 months and, although climatic influences may have been operating to a certain extent, they have not been the vital factor. In the early days of the guaranteed price scheme Mr. Nash talked of so organising the dairy industry that the impetus given by increased prices would not result in over-production. Actually ho has had no need to worry on that score.

The Government’s policy, which has resulted in ever-rising costs, allied with a shortage of farm labour, has been the most potent cause of decreased production, as is shown by the increasing tendency to reduce farming effort to a scale within the scope of the family labour unit. The position is one whicti demands remedial action, particularly as a steady flow of exports is even more important than regulation of imports in the effort to build up the Dominion’s depleted London funds.