PRICES AND MARKETS.

New Zealand Herald, Volume LXIX, Issue 21086, 21 January 1932, Page 8

PRICES AND MARKETS.

The record of payments for butterfat supplied in December, issued by several northern companies, encourage certain reflections about the bearing of the present position on production and marketing. Much is heard to-day of low prices, a great deal of it justified. Yet one company has paid its suppliers £4OOO more for last month than for the corresponding period in the previous year, this being an increase of roughly 18 per cent. The rate of advance has been the same, but the supply has increased by 57 tons. Another company has paid out over £2OOO more for December, 1931, than for the same month in 1930, and estimates that the season so far shows an increase of 13 per cent, in the output compared with the preceding one. When prices were far more favourable, the farmer was urged to increase production in every possible way to provide against an uncertain future. The measure in which he responded to the call, and the way in which it is standing in his favour now, when the adverse turn of the market has come, are both illustrated by these figures. There is another feature of the position, not so obvious, but by no means unworthy of notice. Despite the impressive increase in output, the butter is being sold, and is going into consumption. New Zealand has lost the Canadian market, yet the export of butter proceeds, and nothing is heard of a surplus being held in store overseas. It has been remarked that despite the depression and unemployment in Great

Britain the consumption of imported butter has increased substantially. In other words, the market has expanded under the influences of low prices. The immediate benefit is that worldwide depression has not made New Zealand butter unsaleable abroad, but has seen the consumption of it increase. The possible gain for the future is that when prices move upward, a, large part of the gain thus made will prove to have been consolidated and retained The butter-consuming habit will have been established where it did not exist before. It may also be suggested that the prospects of enlarging the market, even i. foreign countries, are not yet exhausted.