BUTTER "BEARS"
WHY NEW ZEALAND SUFFERS.
WHERE WAS THE CONTROL BOARD?
The true story of the recent butter slump lias y'et to be written (writes "Rusti-ms" in the "Manawatu Daily Times"). Information reaching New Zealand through private channels 'jonfiTms the suspicion that a systematic "bearing" movement was engineered in Great Britain, and it has its lessons for the Dairy Control Board, which was a helpless spectator during the silent crnflict. A great and pleasant surprise was no doubt caused for butter producers by the unexpected improvement in the London butter market recently. Prices jumped from 164s to 172s overnight, so to ;-:ay, making the end of the season look much rosier for the New Zealand producers. The immediate cause has been, of course, f. transport strike in Denmark, but it is evident now that this strike was by no means the sole and only reason. The strike has been settled now for over a week and prices, inI stead 0C tumbling as predicted, have actually further improved, the latest I quotation for salted being 1765.
It is perfectly obvious now that information reaching New Zealand during the past fortnight was a good deal in the nature of bluff from interested parties, and the outcome 1 of a systematic "bearing" movement in Great Britain. It was an attempt made by the wholesale and big retail merchants to force down the price of the large quantities of butler held in England on behalf of colonial factories, and it all' but succeeded. Both wholesalers and retailers in England have for weeks past just existed on a hanfl-to-hand basis, and instead of, say, a fortnights supply—which would omount to approximately .12,00.0 tons—being held by merchants and retailers as is usually the case, this butter had to be held by the individual factories. ' EFFECTS OF DANISH STRIKE. The results and effects of the Danish strike were much more imaginary than real. It must not be thought that Danish butter entirely ceased coming into England during the duration of the strike, because this was not f ; o. During the whole of the short strike a certain amount of Danish butter continued to filter through, but what broke i;-p the "bearing" tactics was the uncertainty and fear of a complete stoppage. Nobody could foresee bow long the strike would last and everybody rushed in to cover against a heavy rise, which no doubt would have eventuated hf'd the strike lasted any time.
That the surplus of butter in Great Britain was more fictitious than real is fully proved by the fact that the week following the - settlement of the strike Denmark rusher! something like 4000 tons'of butter into Great Britain. In addition to this quantity, which is more than double that of normal times, large quantities continued to arrive from New Zealand, Australia and the Argentine, as well as Siberia, and yet instead of the pessimistic forecasts of a reaction being realised, values actually imr> r oved. RESULTS OF .ST ORING. The writer may be excused for once more pointing out the moral of storing large quantities of produce in England. If the Control Board will persist in thi9 practice, it will always be lit) against this difficulty. A continuous ; state of war will exist between the Board and the trade, which naturally comprises n great number of speculators, and in nine eases out of ten the "bears'' will beat the Board. Tire consumer' and even the British Government will be on the side of the trade, and such a continuous wrangle is not ie" the best interests of our business. ; The shipping should be so regulated ' as to allow a free and continuous flow 1 of our butter and cheese on the English markets without creating either
•glut -or scarcity. Such a course will create the least friction and will gradually eliminate the speculative element whicVhas become part of the system.
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Bibliographic details
Northern Advocate, 23 June 1925, Page 3
Word Count
645BUTTER "BEARS" Northern Advocate, 23 June 1925, Page 3
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