DAIRY PRODUCE CREDITS.

New Zealand Herald, Volume LXIII, Issue 19416, 26 August 1926, Page 8

DAIRY PRODUCE CREDITS.

ARRANGEMENT IN LONDON.

REFUSAL BY SOME FIRMS.

SUFFICIENT FOR TWO MONTHS.

WIDER CONTROL PROPOSAL.

[BY TELEGBJLPH. OWN CORRESPONDENT. ]

HAMILTON. Wednesday.

The position regarding the establishment by London firms of credits in the name of the Dairy Produce Control Board was referred to by Mr. W. Goodfellow 'luring an address to the suppliers' committees of the New Zealand Co-operative Dairy Company at Frankton last evening. It had been stated in the press, he said, that a number of firms in London bad -efused to put up their credits. It was true that certain firms had done so, but no small group of merchants in England would be allowed to stand in the way of the success of control, and there was not. the slightest doubt that the matter would be adjusted very shortly. In the meantime sufficient credits had been arranged to cover the next two months and the chairman of the board, Mr. W. Grounds,, bad gone to England to confer with Mr. Wright, the London agent, on the matter.

Mr. Goodfellow said the dairy industry had recently scored a great success by the passing of dairy control into the legislation. He paid a tribute to the Hon. W. Nosworthy, Postmaster-General, for his great assistance in bringing control into effect. Mr. Nosworthy was in fact the first Minister in the world to frame and carry through a bill for the national control of dairy produce. (Applause).

Mr. Good fellow went on to refer to the circumstances which led to national control, and said the next objective would be to try to arrange a conference of exporters of New Zealand, Australia and Denmark -in London with the object of regulating the market and prices. Referring to the statement that had gone abroad that control aimed at raising the price of butter to the British public, Mr. Goodfellow said this was quite wrong. Any effort to extract an unfair or uneconomic price from the British public would only slump the market, for there was a very large margarine eating public in Britain and if prices became uneconomic the people would simply switch over from butter to margarine.

THE CREDIT SYSTEM.

DETAILS OF THE PAYMENTS. STATEMENT BY THE BOARD. [BY TELEGRAPH.—OWN CORRESPONDENT. 1 "WELLINGTON. Wednesday. A circular letter has been sent out to all dairy companies and dairy proprietors in New Zealand by the New Zealand Dairy Produce Board advising them that all necessary letters of credit have now been arranged for shipments of dairy produce as from September. Special arrangements have been made with the banks which allow, of. the credits being held at four centres, viz., Auckland, New Plymouth, Wellington and Dunedin. • This will allow of the board or its agents making out all drafts, invoices, etc..; but at the same time providing for the proceeds of the drafts, as far as the advance to the dairy company or proprietor is concerned/ being placed to the credit of the dairy company free of exchange at the branch of the bank at which the factory's account is kept. Further, the branch bank will receive its quota of London exchange as in the past. The board or its agents will negotiate all drafts and when doing so will draw for the advance to the dairy company, plus the freight, the board's levy, and the London exchange. A copy of the invoice which accompanies the draft showing ail the r >e particulars will be sent to each dairy company. Arrangements have been made under which dairy companies will receive advances on store warrants issued by the freezing company where the produce is graded. Immediately these are handed to the bank these warrants will be handed to that branch of the dairy company's hank which is nearest the grading port, who will immediately advise the branch on which the dairy company operates, «thus making the advance immediately available.

Advance on Butter. ■» Until further advised .the advance on shipment or on store warrants will be as follows:—Creamery butter: "Finest," Is 4d per lb.; "first grade/' Is per lh. ; " second grade," Is 2£d per lb. Whey butter: "First grade," Is Id per lb.; "second grade," Is per lb. Where shipments of unsalted butter are required advice will be sent to the individual dairy company in due course. The premium for unsalted butter will be on the basis-of 2^per cent, above the price realised for salted. For instance, at 160s it would be 3s 7d, at 165s it would lie 3s Bd, and so on. Until further notice the advance on cheese shipments will be as follows: Full cream factory cheese: "Finest," 7|d per lb.; "first grade," 7£d per lb.; "second grade," 7d p'er lb. A premium of 4d per cwt, will be paid for coloured cheese to cover the cost of making this class of cheese This payment will also be made when the interim or final payment is made from the pool. Cheese factories are asked to note that the board wishes them to make until further notice approximately two-thirds white and one-third coloured. The basis taken will be that butter should weigh 561 h Boz., including paper. Any shortage will be deducted from the invoice showing the advance. While there may be dairy companies who have only been putting 561b. 40z., or 661 b. 6oz. in the boxes, all will realise that if a common basis is adopted and all results are pooled no dairy comoanv can suffer in respect of butter weights. Shrinkage in Cheese.

It is realised that the shrinkage in cheese is considerably influenced by the quality of the cheese itself. This being so it will be necessary for the board to debit back to each company the shrinkages as shown when the cheese is sold in Great Britain. Therefore the advance on cheese will be made on specification weights with no deductions. The first pool to close will be for butter and it will be completed when the last of., the creamery butter graded in October has been sold in Great Britain. Immediately these sales are completed steps will be taken to make the final payment as promptly as possible. In connection with cheese, and, as a matter of fact, with all other pools, interim payments will lie made whenever the market warrants and the final payments will be adjusted as promptly' as possible. All da.irv companies will realise that with the exception of premiums for unsalted butter and coloured cheese and debits for shrinkage on cheese the further payments from the separate pools will be at an even price per lb. of either butter or cheese, irrespective of grade, the differentiation on grades having been made in the a-dvance.