BUTTER IN AUSTRALIA.
Forward buying of New Zealand butter by Australian importers has caused great perturbation among members of the Australian Butter Stabilisation Committee. They declare that the season's output is sufficient to meet the whole domestic demand. Since Australia is an exporting country that should be so. The reason why New Zealand competition is regarded as a menace by the Australian dairy farmer is because the normal course of trade has been disturbed in that country. Under the Patergon scheme the world parity, on which the domestic price is based, is given a fictitious value by the addition of threepence a pound to the export price. Thus the domestic value is raised to an extent making the present duty of twopence a pound on imports from New Zealand .insufficient to prevent competition. Had the scheme not been applied, it is at least doubtful whether New Zealand butter, after paying freight, insurance and handling costs, could have been sold in Australia at a profit except in times of scarcity. Presently, when the new duty of 6d British, intermediate and 7d general—passed by Parliament in December—becomes operative, New Zealand competition will certainly cease. The six months' notice which, in terms of the 1922 agreement, the Commonwealth is required to give before increasing the duty will not expire until the middle of May. Until then the butter committees will be exercised in mind, as they are now, to deal with competition from New Zealand. The forward buying of which they complain is doubtless in anticipation of the new duty. Again the situation can be traced to the artificial conditions created in the market by interference with the normal course of trade. It is for the Australian producer and consumer to settle between themselves the question of its ultimate value. Meantime, the temper shown over butter does not seem to augur very well for the negotiations for a new trade agreement which it is hoped to begin shortly.
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New Zealand Herald, Volume LXV, Issue 19856, 28 January 1928, Page 10
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325BUTTER IN AUSTRALIA. New Zealand Herald, Volume LXV, Issue 19856, 28 January 1928, Page 10
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