LOCAL BUTTER PRICES.

New Zealand Herald, Volume LIX, Issue 18130, 30 June 1922, Page 9

LOCAL BUTTER PRICES.

I METHOD OF FSX3KG. ■ Pv'ITIOX OF COMPANIES. ALLEGED LOSS '.TO PRODUCERS. The matter of fixing tie local price of butler was discussed yesterday fcv Mr. H. ; C. Aickin, Auckland representative of the Opotiki Dairy Company. He explained ; the practice in the past , and urged that 1 responsibility for averting loss to the pro- v j oncers lav with the BnUer Producers' ] Committee, j In only one ■way, said Mr. Aickin, vra.? i it. possible to fix the price of butter for the ] local marked so as to assure to tie dairy- ] ir.g companies operating it a return oquiI valent to export values throughout the ! year. Previous to the war, and before the | price of butter for the local market was j controlled by the New Zealand Govern- ! meat, Auckland local values, during_ the . export season, were fixed by a committee |in accordance with London par:ty. Fre- j ! quently the price fixed at the commenoej ment of a would continue far seve- | ral months, and in some instances through- : out the whole export period, which at that. , I time of lesser batter production throughout j ! the Dominion, extended from October to ] i the end of March. During Apr/i and j \ May butter was stored by the large_fac- j ' tories for winter requirements, and taking j i as their foundation for value the price. ! ruling for export butitr when the last of , : the season's shipments were made during , i the winter, the local price was regulated i in accordance with the law of supply and ! demand. As an instance of how evenly ! the balance was kept between the export i and local prices, figures were taken out, by 1 the Opotiki Dairy Association covering i nve vears of it£ Auckland butter business I nr. to ISI4. when it was shown that there i had been a local advantage- of id per lb. ] | for all the butter sold by the association ; j during that period. SelaUon to Export Values. With the enormous increase in batter , i production, added Mr. Aickin, the . season was now greatly extender, and , butter was still being exported from j Auckland- Consequently expert valuer must govern the local price practical!} durinc the whole year round. Had t.iis : policy been adopted in its entirety recently, dairying companies tnrougfaoui j Auckland Province could have vjeweo .ne magnificent values now being realised m London with far greater complacency, but l the failure of companies operating on tne, local market to regulate the price in ac- j cordance with changes on the London , market, resulted in faetories disposing o. . their butter to speculators, instead o ■ i holdin c it for winter use, and present | high values, It- took approximately three ; ; months to market in London butter manufactured in New Zealand, therefore cutter made in January, under normal condit tions, would be sold during April '.n n , i don- Last January the average local , I price upon an f.o.b. basis Is P er • Ilb based on an averacfc f.o.b. London j price of Is per lb. January-maae nutter ! reached London in April, ! realised an averace of Is Oja f.0.b., so the loss upon local sales for the month • : amounted to 3|d per lb. Locai sales dur- | ins: Februarv also averaged Is I?d f.0.b., j ! but butter manufactured at the same tune ' averted Is <Hd f.o.b. in London, a loss ' lof 2id per lb. The local average price March fell to Is lid f.0.b., but : March butter actually realised m London ' during June Is 6id f.0.b., an ascertained i loss of sjd per lb. The average lo«d ! price during April, May and June worked jout at- Is per lb., and should the , 1 preset price of 236s per cwt in London, . equal to Is lid per lb. f.0.b., hold dur- ; <£g July. August and upon butter sold on the Auckland market during the last three months would | amount- to 6id per lb- | . Auckland Wholesale Bates. I Auckland wholesale prices from Sep- ! tember to December were considerably in 'favour of factories operating the local : market, but since March, when the Lindon market showed such phenomenal lmI provement. the failure to observe the {time-honoured practice of fixing local i butter prices in accordance with tfign ! Commissioner's weekly London cables, ■ had resulted in loss to the pro ducers, and the only way to avert such serious losses for the future was to fix local prices from week to week m accordance with export values ruling at the time. In this way only would equal returns for both export and local sales of butter be assured over every season, and the onus of securing J this end rested with the newly-appointed Butter Producers' Committee.