LONDON BUTTER PRICES

New Zealand Herald, Volume LX, Issue 18373, 13 April 1923, Page 6

LONDON BUTTER PRICES

EXPERTS OPTIMISTIC

IMPROVEMENT ANTICIPATED

DEMAND FROM AUSTRALIA.

■ The ! recent decline in butter prices on the London market is not viewed with alarm by experts in: the dairying industry in Auckland. ■';;. The opinion is generally held that the -bottom of the market has been ; reached, and that a' gradual improvement in prices should ensue. :' ■ 'One authority expressed the opinion yesterday that the recent decline had been caused by the merchants forcing the price to a level that seriously affected the consumptive demand. < The position, he said, appeared to be very similar to that which developed in the butter market at the end of November and the beginning of December. In the middle of November the wholesale market quotation for butterwas 212s to 216s per cwt., and the retail price reached 2s per lb. This figure apparently was beyond the purchasing power of a considerable section of the public, and consumption materially decreased > As a result prices dropped toward 'the end of November and at December 7 stood at 170s to 174s per cwt. A reduction of the retail price to-ls-10d per lb. apparently had no effect on the wholesale market, and a further reduction in the retail price to Is 8d per lb. was made. The consumptive demand was immediately stimulated to a marked degree, and the recovery of the wholesale market commenced. v Prices rose gradually from the end of December to the end of February, when butter was quoted- at 196s to 200s. During the period mentioned there were heavy arrivals of butter in London, those of January totalling 501,209 cwt.. of which 356.429 were from the Southern Hemisphere. The retail price was then Is lOd per lb., and the whole of the arrivals—approximately 25,000 —went straight into consumption. It was not until the retail price was forced beyond 2s per lb. that the consumptive demand fell away and caused the market to drop, added the speaker. A reasonable reduction Jin '. the retail price, he considered, should again stimulate the demand, and improve the wholesale market. .''■' ■: m \ v •'■ Up to the present, he said, the drop, in i prices in London had not "greatly [ affected the New Zealand suppliers. From the latter part of February till the middle of March, when the. London values ranged from 204s to 214s per cwt., 317.595 boxes of New Zealand butter arrived in Britain. During the recent period of low values the arrivals of New Zealand butter reported were under 30,000 boxes. ? j. ■ ■ ; It was significant to note, added the speaker, that the dairy companies had not lost confidence in the market prospects. Offers of Is 8d per lb.'- f.o.b. hadj been refused last week. Another factor that had to be considered, he said, was that there was a farly strong demand. for butter from Australia, where drought cond '-;< ns had seriously affected the season's output. ) Australia was likely' to require large winter supplies from New Zealand, and . sales; had already \ been made'! at:■; Is 8d per lb. f.o.b. -3 The demand -from. the Commonwealth would, relieve ; the London market and contribute, to its recovery. •"•'. •■•-■"■ '-■'•''•" '■ '""■•" f: '■" ~ ■'■•■ ••■-' } ■■;■