PLAN FOR CRISIS

New Zealand Herald, Volume LXXI, Issue 21769, 7 April 1934, Page 13

PLAN FOR CRISIS

'AIDING the farmers marketing of butter PATTING plants proposed GOODFELLOWS programme

{ 10-point remedial policy to assist ilie dairy industry to meet the present ; risis and to compete successfully in L, world's markets was propounded by »[ r William Goodfellow, managing director of Amalgamated Dairies, Limited, in a statement issued to the \ E w Zealand Herald yesterday. ' The paramount importance of reduc- • fr all internal costs was emphasised by Mr- Goodfellow, who said goods of a "]| descriptions, other than food, ve re fnr too dear and were restricting the buying power. The farmers could 10 longer carry the high tariff on their backs. He suggested the following remejj'jes for the consideration of the Government and the industry: — (1) National economy. (2) Reduced tariffs and rates. (3) Bring exchange back to par with iterling(4) Replace exchange premium with temporary subsidy. (5) Encourage da icy farmers to breed pigs, ewes and poultry. (6) Maintain the quality of dairy produce. - . (7) Reorganise the Dairy Produce Actively push sales in all new jnarkets. (9) Establish three large centraj patting plants in the United Kingdom. (10) Push <md advertise "Fernleaf" pat butter throughout Great Britain. Reducing the- Tariff "New Zealand should- prepare for the florst and not continue to hope foj the best," said Mr. Goodfellow in ' elaborating his programme. When European conditions' did improve New Zealand would once again have no difficulty in selling its dairy produce, provided (|uality and costs were competitive. Economy of some magnitude could be secured, for instance, by reducing the size of Parliament by 50 per cent. / Mr. Goodfellow considered the tariff should be removed forthwith from all British goods which did not compete with local industries. Thereafter the Tariff Commission's report should he dealt with and' put into operation as toon as possible. As the United Kingdom was New Zealand's only big market, we should aim at a permanent policy to keep our exchange 011 a parity with sterling. I'ntil the tariff had been substantially reduced and some improvement bail taken place in the world's markets, the dairy farmer should receive a -subsidy. The British Government haj.l established a precedent in that respect. The encouragement of farmers in diversified farming was also advocated by Mr. • Goodfellow. For instance, advantage should be taken of the present high price of pigs for export. Farmers should put 011 sheep and produce poultry rather than increase their dairy herds at present. The Government, with the co-operation of the Dairy Produce Board, should aim at a steady and permanent improvement in the average quality of butter and cheese. Reorganised Dairy Board The reorganisation of the Dairy Produce Board, to make it a strong leader for the industry, was urged by Mr. Goodfellow. of dairy companies should elect a national dairy council on a. ward system, based on tonnage of produce. The council could meet occasionally to discuss policy matters, and from its members elect an executive or board to"carry out its instructions. A board so constituted would get on with the important business and give a lead in all matters of importance. "Our selling system in the United is all wrong," said Mr. Goodfellow, who recalled that the New Zealand Co-operative Dairy Company established a patting plant in London nearly 10 years ago. The- "Anchor" pat trade had grown steadily until to-day about 90 tons weekly were sold in £lb., Jib. „ and lib. pats throughout Great Britain. The system of selling in bulk made substitution extremely easy, and it was also difficult to advertise a bulk line as there was no guarantee that the customer received what he asked for. Further, the patting of butter overcame the spreadibility difficulty. Employment of Travellers Mr. Goodfellow thought the Dairy Board should establish immediately three large patting plants, say, in London, Manchester and Glasgow, where bulk New Zealand butter would be examined and then repacked in jib., slb. and lib. pats under the "Fernleaf" brand. It should thus be possible to build up fairly rapidly a trade in packet butter of. say, 20.000 boxes a week, which could be gradually increased until most of the butter was sold in that manner. By those means he believed Danish prices could be obtained for finest New Zealand butter. It would be advisable to employ about 50 travellers throughout Great Britain, each to canvass a given list of shops for orders 'weekly. The manager of the pat plants would buy his weekly requirements from London importers, thus preventing friction with Tooley Street merchants, and, at the , game time, raising the price by buying large quantities' on the market regularly. An annual sum of £75,000 to £'loo,ooo should be available for publicity A further suggestion was that the Dairy Board should locate travellers at central points to develop new markets. One could be pjaced at Hongkong to work the whole of the East; a second at Montreal to keep in touch with Canada and the United States; a third at Panama to work Central America; and a fourth in London to work the Mediterranean and North Africa. Finance From Marketing Levy To finance the scheme, Mr. Goodfellow suggested the Dairy Board should be empowered to make a marketing levy on all dairy factories of Id a lb. on all local sales of butter, and 4d a lb. on cheese. Dairy produce was sold at very low prices in the Dominion, and an extra Id on the retail price of butter would not affect consumption. By that method tho board would collect annually, say, £250.000 without any payment being made by the dairy farmer. Referring to the patting plants proposal. .Mr. Goodfellow said it might be possible to induce the directors of the New Zealand 'Co-operative Dairy Company to hand over as a going concern at a reasonable price their new freehold property and plant in South London. The "Anchor" pat business was being extended at tho rate of 500 tons annually. All expenses, including advertising, were paid out of profits. The capital required for each plant would be about £IO,OOO, and, lie had 110 doubt, the money could be obtained readily either from the bankers of the Dairv Board or from the Government. The revenue would repay the cost of the plants within three years.