NATIONAL DAIRY CONFERENCE

Nelson Evening Mail, Volume LXXI, 23 June 1937, Page 7

NATIONAL DAIRY CONFERENCE

OPENED BY MINISTER AT HAMILTON TO-DAY DISCUSSES POINTS FROM REMITS The lion. W. Lee Martin (Minister of Agriculture and Acting-Minister of Marketing iu bis speech at the opening of tlie National Dairy Association Conference, at Hamilton, today, referred firstly to the remit:— That payment by the Government for butter and cheese be made at factory door or at Hie time of grading or at some other point before 1'.0.b. ocean steamer. I notice that a number of remits on your order paper suggest that payment be made by the Government for butter and ebee.se at some point earlier than 1'.0.b. ocean steamer, and at the recent South Island Dairy Association Coulerence similar remits were considered. 1 can say that very full consideration was given to the most appropriate point at which payment for butter and cheese should be made, and the committee responsible for working out the details finally came to the definite conclusion that the point of 1'.0.b, ocean steamer was the most suitable. i would suggest to the Conference that both from the point of view of the Industry and the Government the present method is the most suitable. The point of 1'.0.b. ocean steamer lias the following advantages : (1) The existing arrangements for transport and storage of produce are in the hands of the dairy industry through the dairy companies and their subsidiary cool storage companies. It therefore seems desirable that this organisation and control by the industry should not be interfered with, unless there are very strong reasons to the contrary. (2) Quantities of butter and cheese are frequently withdrawn from the export allocations for local sale, and this would cause a complication if payment had already been made for this produce for export. (3) The grading stores throughout New Zealand are almost entirely cooperatively owned. This being the case, it seems reasonable that the dairy factory companies should have the responsibility .of seeing to the proper transport and storage of the butter and cheese and that they should deliver tho produce ready for export, free on board the ocean steamer. PERIOD OF STORAGE 1 have noticed that the representatives ot some dairy companies have commented on their increased interest charges, and they have suggested that any additional cost under this heading arises from a longer period of storage than was formerly the case. 1 consider that any increase in interest charges arises mainly from the fact that this season, with the certainty of the guaranteed price payments, dairy factory companies have been able to assist their suppliers by making relatively higher monthly advance payments than they were able to make under the old system. This lias, in the case of companies working on an overdraft, led to a somewhat greater payment for bank interest. As you arc aware, arrangements ; have been made for store warrant advances to be made by tne banks at the best interest rate (4$ per cent.), the amount of the advance being about 90 per cent, of the ultimate value of the produce. During the season, iu some cases there lias been a slight increase in the period of storage compared with last year. The Government desires to spread shipments and arrivals of butter and cheese in England as evenly as possible, and in accordance with a programme worked out by the Loudon officers of the Department in collaboration with the selling agents. It is felt that the industry will heartily approve of this policy. I think any extra cost of storage would be very slight in. deed, and would be covered in the general allowance made for factory costs in the computation ol the guaranteed price. The guaranteed price plan aims to provide a butterfat payout for suppliers at an average figure. In order t 0 carry out this policy allowance is made in the calculation for the average ascertained butter factory and cheese factory costs. These costs will, of course, include the items interest and storage. If payment for the butter and cheese and ownership by the Government were to take place at a point before f.o.b. ocean steamer, then the sav. mgs in interest and storage costs which dairy factory companies would make would be allowed for in the computation of the guaranteed prices, which, as already stated, arc designed to return an average butterfat payout to suppliers. That any surplus from the sale of cheese under the guaranteed price plan

be paid to cheese companies. Various representations have been made tj the Government in regard to the disposal of any surplus in the Dairy Industry Account, and in regard to the keeping of separate pools for cheese sales and the butter sales, 1 can only say that these matters were dealt with by the Hon. VV. Nash in his speech on the 1936 Budget. Mr Nash explained that if over the current year, sales of dairy pro ducts exported during the present ye,u (i.c. Ist August, 1936, to 31st July, 1937) produced any sum in excess of the amount paid out by the New Zealand Government, the excess will be used for the benefit of the dairy industry after eon sultation with its representsti\es. If the proceeds of sales are less than the sum paid out by the New Zealand Government, tlien the deficit is shown in tho Dairy Industry as an overdraft.

That a, premium be paid for butter manufactured during the winter months so ethat the winter supply cream may be encouraged. Tins remit introduces a suggestion which is well worthy of consideration, and I am asking that the Guaranteed Trice Committee consider the matter and make a recommendation. CHEESE CACTUItY COSTS That the guaranteed price he based on tlie costs of production of cheese factories manufacturing 150.200 tons annually. Tho Guaranteed Trice Committee will, 1 Know, give very careful consideration t, cheese factory costs. 1 would remind Iho Conference that the guaranteed prices are not intended to equalise existing differences in the economic circumstances of butter and cheese factories throughout the Uonuiuon. The aim is to pay prices which will enable cheese and butter factory companies working under average conditions to pay an ascertained price. That the Guaranteed Trice Committee include nominees appointed by this Conference, The personnel of ihe Guaranteed Price Committee is : The f'fou. Sir Prancis I'Tusor, Mr G. A. Duncan, Mr D. Jones (Executive Coin mission of Agriculture). Mr J. Dunlop, representing tho Southern Ward of the New Zealand Dairy Lloa rd ; All- W. E. llale, representing the Now Zealand Co-operative Dairy Co. Ltd., oil

the New Zealand Dairy Board; r •Mr A. Morton, president of the Nation- | ai Dairy Associations; p Mr N. H. Moss, barrister and solicitor, | Stratford ; Mr H. Roberts, M-P., director of Parkcalc Cooperative Dairy Co. Ltd.; Mr A. J. Sinclair, secretary-manager of the Te Awaniutu Co-operative Dairy (;■>. Ltd. ; and Mr U. 0. Williams, economist, Massey Agricultural College, Palmerston North. These gentlemen arc all of the very highest standing and enjoy the confided :e or the industry, Mr Roberts is the only one of whose political opinions-.! have my knowledge. The Committee will not hx the price, but will make its recommend i t.'ou to the Government. The N.C A has already been recognised by the appoint nient of its president (Mr A. Morton). |