Britain May Buy Only Portion Of N.Z. Produce

Northern Advocate, 9 November 1939, Page 7

Britain May Buy Only Portion Of N.Z. Produce

[Special to “Northern Advocate”l . WELLINGTON, This Day. MINISTER FOR MARKETING (MR. NASH), IN A BROADCAST ADDRESS LAST NIGHT, SAID THERE WAS A SUGGESTION NOW THAT TEE UNITED KINGDOM GOVERNMENT WANTED TO BUY ONLY A CERTAIN QUANTITY OF NEW ZEALAND DAIRY PRODUCE. •Mr, Nash reviewed the progress of negotiations between the Dominion and British Governments concerning the purchase of New Zealand's exportable surplus of primary products. As far as the price at which the United Kingdom would buy dairy produce was concerned, the figure named in a cablegram received last night would result in a deficit in the Dairy Industry Account of £2,500,000, he said. This seemed to be almost the last word. but. as a result of the continuance of negotiations. 'New Zealand was in a slightly better position than that of two weeks ago. .* Mr.'Nash said he hoped to announce the price and the conditions of purchase before the end of this week, or early next week.

Prices And Production. Mr Nash replied to an inquiry from a farmer in Taranaki as to how the Government expected a greater production to be achieved on last season’s guaranteed price and this season’s higher costs. Mi* Nash said that the inference was that high prices brought more production. He would remind the correspondent that in 1930-34; when prices were at their lowest, and butter ranged from 65/- to 75/- per cwt., production went up by leaps and bounds.

Recent lower production was due almost exclusively to climatic conditions and disease among stock. Mr Nash added that on last season’s operations the deficit on butter up to November 2, was £1,349,807, and on cheese, £1,202,728. Deficit of £2,500,000. The total deficit would be slightly below the sum of these two amounts, because there was still about 7000 tons of last season’s butter for which New Zealand had not yet received a return from London, ,and 7200 tons of cheese.

“We will be about £2,500,000 down for the year,” Mr Nash said.

If, however, the Government had not been handling dairy produce, the country would have been still further down, because there would not have been the same organised marketing. “Had there been no guaranteed price and organised marketing, the dairyfarmers would have received £3,000,000 less than they did receive,” Mr Nash added, and he said there were two reasons why the guaranteed price was not increased for the current season. One was that the facts did not warrant an increase, and the second was that an increase would give the industry more'than its share of the national income, and might produce in-' flation. More Favourable. As a result of the exchange of cables last week, and of representations made by Mr P. Fraser and the High Commissioner (Mr W. J. Jordan) to the British authorities, a more favable position was in view, Mr Nash stated. It was, however, impossible to say yet whether the British Government would pay the full price f.o.b. Another question still to be decided was that of payment for storage over a certain period in New Zealand. Prices cf Imports. In general, Mr Nash said, New Zealand recognised that the prices they had arranged for the sale of wool and meat were reasonable in view of costs, and these were certain for at least a year, but prices of imports were not certain. If the price of imported goods went up, New Zealand could buy fewer ’ imports.

They had suggested that, if the price of British manufactured goods rose by 10 points or more, the British Government should be asked to reconsider the prices for New Zealand exports. Mr Nash said this was still being ciscussed. A cablegram had arrived yesterday to say that it was doubtful if the United Kingdom Government would agree. At Disadvantage.

The New Zealand Government had pointed out that New Zealand would be in a very disadvantageous position if it sold exports at an agreed price and was then compelled to pay abnormally high prices for imports. Mr Nash hoped that finality on the question would be reached in the next few days. Arrangements for the purchase of meat were very nearly completed, he said. Approval by the United Kingdom Government would be given probably within the next few days. Meanwhile, loading of meat would be continued, but applications for future export licenses or permits must be submitted to the Export Licensing Department, which was working with the Customs Department. Resale Question.

On the question of resale by the United Kingdom of goods purchased from the Dominion, it was suggested by New Zealand that any profits made should be divided equally between the two countries.

No agreement had yet been reached except on wool, concerning which it had been determined that half the profits would come to New Zealand, and be distributed ultimately to the suppliers.

There was also the question of the transition, after the war, from the total purchase system. Mr Nash said it was the aim to achieve this with the least possible dislocation, but no final statement had yet been made, and cablegrams were still passing between the two Governments,