CANADA AND NEW ZEALAND

New Zealand Herald, Volume LXVII, Issue 20554, 3 May 1930, Page 11

CANADA AND NEW ZEALAND

TRADE AGREEMENT TO END.

HIGHER DUTY ON BUTTER.

DIRECT TREATY PROPOSED.

By Telegraph—Press Association—Copyright. OTTAWA,' May 1. The Minister of Finance, Mr. C. A. Dunning, in the course of his Budget statement to-day, announced that the trade, agreement with New Zealand would be abrogated on October 12. A duty of four cents per lb. on New Zealand butter, instead of one cent., would become effective at that date. After October 12 Canada will extend full British preference to New Zealand. Mr. Dunning said the Government of Canada had proposed to the Government of New Zealand that a direct trade agreement be negotiated to supersede the present arrangement.

"We hopo to be able to arrange for a meeting of representatives of both countries ir| tho near future," lie said, "in order to endeavour to reach a mutually satisfactory arrangement."

EFFECT OF TARIFF.

MR. GOODFELLOW OPTIMISTIC

SOLELY TO HELP FARMERS. The opinion that the increase of three cents in the tariff on New Zealand butter would have little effect on the export trade to Canada was expressed yesterday by Mr. W. Goodfellow, managing director of Amalgamated Dairies;, Limited. He said the sole object of the tariff was to give Canadian farmers a higher price for their product, and as Canada did not produce enough butter for her own requirements, there was no likelihood of New Zealand butter being shut out. Tho effect would be to raise the price of butter in Canada and the extra per lb. would bo received by tho Canadian dairy farmers. Mr. Goodfellow said so long as the duty was not too high to result in a decrease in consumption, it would not affect the quantity imported. The extra Ijd would make practically no difference to the consumption of butter in CanadaThe future of the market in Canada would depend very largely on the action of the United States with regard to the exports to that country of milk and cream from the eastern States of Canada. It was feared that the United States Government would place a high tariff on the milk and cream imports and thus ruin what had become a thriving trade in Eastern Canada. If this action were taken, Canadian farmers would be forced to manufacture further quantities of butter and cheese, thus limiting the amount it was required to import.

. " The Canadian Government does not wish to jeopardise trade with New Zealand," said Mr. Goodfcllow. " The concession has been made as the result of continual agitation by Canadian dairy farmers, and it is not intended to have any bearing on New Zealand's trade " Mr. Goodfcllow said that a very valuable outlet for New Zealand dairy produce had been found in the Canadian market, both through Vancouver and Eastern Canada. From August until March, inclusive, during the present season. Canadian imports of New Zealand butter amounted to 18,541 tons. Including the quantity already sold and which would be shipped up to the end of May, the total would exceed 20,000 tons.

The view that it was doubtful whether the extra could be passed on' to tho consumer in Canada was taken by Mr. W. A. E. Leonard, of Leonard and Son. This would mean that the producers in New Zealand would have to bear the burden imposed by the tariff.

Mr. Leonard said it was a question whether the New Zealand Government should not protest against the imposition, and also cqbqder means to retaliate. He considered that, although exports of dairy produce to Canada would continue, the trade would not be such a profitable one. The tariff would affect the large shipments from New Zealand intended to arrive during the Canadian autumn, when local stocks were short.

Referring to the cause of-the new tariff, Mr. C. M. Croft, Canadian Trade Commissioner, said Canadian dairy farmers had been agitating for a considerable time to have the tariff on New Zealand butter increased. They felt that the heavy imports at low prices from this country had had a detrimental effect on the industry in Canada. Mr. Croft said it was not tho desire of the Canadian Government to influence detrimentally trade with New Zealand. Rather, improved arrangements for trade wcro desired, as the Canadian Government had proposed to the New Zealand Government that a direct i trade agreement should be adopted between the two countries. Tho proposal for a meeting between representatives of the two countries also pointed to a feeling in favour of the extension of inter-Dominion trade.