THE BUTTER MARKET

New Zealand Herald, Volume LXX, Issue 21400, 26 January 1933, Page 5

THE BUTTER MARKET

ADVANCES ON EXPORTS

INCREASE ANNOUNCED LONDON PRICES LOWER Acting upon advice from their principals in London, dairy produce agents in the Dominion have increased advances mado on export consignments of butter and cheese as from Tuesday. The new rates are 8d per lb. butter and 4£d per lb. cheese, as against 7|d and per lb. respectively previously ruling.

The rates are adopted by all agents and are based upon 80 per cent of the approximate value of tho produce. The increase is primarily influenced by the higher rate of exchange. In some quarters it is considered that the London houses are also taking a brighter view of the future of the market.

Tho first shipment from Auckland which the new rates will affect will be that by the Waimana on February 3. The Dairy Board's allotment of Auckland produce to this steamer was 36,500 boxes of butter and 2500 crates of cheese.

Tho New Zealand Co-operative Marketing Association, Limited, has received the following cablegram from its London house, dated January 24:—Butter: New Zealand, 79s to 80s per cwt.; Danish, 106s to 108s. Cheese: White, 465; coloured, 58s to 595. Both markets are quiet.

SURPLUS IN AUSTRALIA SEARCH FOR SOLUTION UNIFORM PRICE PLAN [from our own correspondent] SYDNEY, Jan. 10 Owing to the operation of the Paterson plan consumers of butter in Australia pay 6d a lb. above world parity. This evens up the price for the exporter, but it has not prevented a crisis from arising in the industry. Australians already pav much more for their butter than New -Zealanders, and it would not be surprising if the margin was increased, to the detriment of the Australian consumer. Faced with the expectation of a record year for butter production and the lowest price for 40 years, the Dairy Produce Control Board is now seeking a solution of the problem. The elimination of inter-State competition and the creation of a uniform price is understood to be one of the objects of the board. Ifc is estimated by the board that the output from July 1, 1932. to June 30, 1933, will aggregate 187,000 tons. The surplus for export is estimated at 117,000 tons, leaving 70,000 tons to bo consumed in Australia. Between July 1 and November 30 last year—the first five months of the current dairy year—the production was 7894 tons greater than during the corresponding period of 1931. The surplus is being Exported to the London market, which is already heavily over-supplied with Australian, New Zealand and foreign butter.

The, enormous increase in butter production is forcibly illustrated by the fact that last year, for the first time, the value of dairy production—£39,ooo,ooo— the value of the Australian wool clip. However, the value of butter exported was not greater than the value of wool exports, because a greater proportion of the bntter is consumed within the Commonwealth. Dairying is ranked third among the export industries, wool and wheat being at the top. During the last five years butter production has practically doubled, and in 10 years exports have increased from 32,000 tons a year to 91,000 tons. Calculated on an average basis, the prices in London during the last 10 years fell from 185s a cwt. in 1923 to 96s a cwt.— or a fraction under Is a lb.—last year. The prices are so low that Australia has not yet felt any beneficial effect of the a lb. duty imposed on foreign butter by Britain under the Ottawa agreement. All States have participated in the increased production, but Victoria has been outstanding. Under normal conditions the dairying industry was advancing rapidly, but during the depression, strangely enough, production has accelerated at an astounding pace. This is mainly due to the fact that when wheat prices fell to an unprofitable level many farmers turned to dairying, which was then giving a far better return. Wheatgsowers were encouraged into butter production, also because of the fact that at a period when money was badly needed they were" assured of a quick financial return, instead of having to wait months for the sale of their wheat.

BUTTER-FAT PAYMENT' KING COUNTRY FACTORY The Pio Pio Dairy Company, Limited, near Te Kuiti, paid £6430 to suppliers on January 20, the rate being 8d per lb. butter-fat.