CHEESE INDUSTRY

New Zealand Herald, Volume LXXIV, Issue 22725, 11 May 1937, Page 7

CHEESE INDUSTRY

TARANAKI POSITION HOME SEPARATION GROWS PRICE MARGIN INSUFFICIENT Owing to the effects of the guaranteed price for butter-fat upon the returns to farmers supplying for cheese manufacture a very serious position is arising in Taranaki, according to leaders of the industry there. The fears that have been voiced in Auckland regarding the future of the industry have - more general application in the southern province, since it is the largest cheese-producing district in the Dominion. If the present trends are not arrested there is a possibility of a widespread change-over to butter, the • increased output of which will place an additional strain upon that market. Although heartened at the beginning of the season by the Government's • promise of a margin of lid per lb. butter-fat over butter, cheese suppliers in Taranaki are now realising that owing to circumstances which operate in Taranaki more particularly than elsewhere in New they may receive only half the expected margin. During recent years there has been a gradual but persistent swing-over from whole milk supply to home separation. Margin Not Received It was hoped that the margin of lsd per lb. butter-fat would check this development. But the margin will not be received this season and a more pronounced trend toward home separation or butter and casein will undoubtedly occur unless the margin is widened. Such a movement would have farreaching effects upon the whole dairying industry in the Dominion. At the commencement of the season it was anticipated that the guaranteed price would on an average bring butter to 13.05 d per lb. butter-fat, and cheese to 14.50 d per lb. butter-fat. Owing to the special factors operating in Taranaki this position will Ije considerably altered. In the first place, butter factories will average approximately 13.50 d per lb. butter-fat, according to .. an authoritative estimate. Secondly, Taranaki cheese factories generally cannot show yields as high as the average yield for New Zealand on which the margin of price was calculated. Cheese yields range from roughly 2.30 ;.to 2.75 throughout New Zealand and the giiari anteed price wa« calculated on an average gross yield of 2.51, which is considerably higher than the Taranaki average. NJ Increase in Costs The average increase in' costs due to recent legislation has been worked out for a group of Taranaki factories at •id per lb. butter-fat for butter factories and id per lb. butter-fat for cheese factories. Taking into account the increased costs and the lower yield in Taranaki, the average cheese factory will show a margin over butter . of about- fd per lb. butter-fat instead of the promised l£d. Individual factories* will, of course, vary according to costs, over-run, yield and premiums received for grading, but allowing for these factors it _is obvious that the fixing of the price for the forthcoming season is a mat-, ter of considerable moment. If at least a clear l£d margin is not given cheese suppliers, the industry will be faced with a serious loss. Advantages of Home Separation The suppliers' pomt of view under the present conditions is that it will be more profitable to supply whole milk for butter and casein manufacture than for cheese, as casein is also worth at least 2d per lb. butter-fat. A greater danger lies, however, in the fact that home separation offers so many advantages." It saves time, there is less volume of raw material to despatch, transport is dispensed with as the cream lorry picks up the cream at the gate, and less employed labour is required. t ■ ' As the separator extracts any foreign matter from the milk and the cooling process is simplified, the farmer usually : receives a higher grade for his cream. 1 The strength of these advantages is ! emphasised in the fact that in praci tice a supplier seldom changes from i home separation back to whole milk i supply. | If the gradual change-over from i cheese to butter is allowed to continue many cheese factories will become un- ! economical to run, building space will be wasted, and machinery rendered idle. Further, in the,final stage there will be a loss of employment as a cheese factory requires approximately four times the staff necessary in a butter factory handling the same quantity of butter-fat ( from home separation. . < Valuable Market at Stake The most important factor, however, is the possible effects on the British market. Figures for 1936 show that New Zealand supplied approximately 30 per cent of the butter sold on the' British market and about 64 per cent of the cheese. The Dominion is competing against the world for its share of the butter market and her competitors are grow- j ing each year, but she has almost a monopoly of the cheese market under j most favourable condition's. Whereas her distance from the market is a dis- I advantage in butter, which is 'hotter j delivered fresh, the reverse is the case j with cheese, which matures with age. J Further, up to the present butter f prices have generally been lower than | the guaranteed price, while for the * most part cheese has been higher. | FORTY-HOUR WEEK ; EXPERIENCE IN MINING OUTPUT THREATENED i Reference to the introduction of a I compulsory 40-hour week is made in J the annual report of the directors of 3 the Martha Gold Mining Company 1 (Waihi), Limited, for the year ended December 31, 1936. The Arbitration j Court granted a reduction from 44 • I hours to 40 hours in August last, year j to the four unions in which the com- 1 pany's employees were working. The application of the employees was | opposed on the grounds that so much £ of the work was continuous and that | a large quantity of the ore could not stand" an increase in working costs. | The ruling of the Court allowed the . | 40 hours to be s'pfead over six days, J thus permitting work to be done on J Saturdays without paying overtime. § This ruling did not meet with the ap- I proval of the four unions, and all the members, with the exception of those connected witli mine pumping and power, suspended work for a week. The company is negotiating, for new agreements with the unions'"'this month. "The introduction of the 40-houi week has involved a good deal of re-, « arrangement in our operations," states the superintendent, Mr. H. W Hop- > kins, in his report "This had to be j done to reduce to a minimum the extra I expense which it threatened. The reduction in hours must result in a rise | in the cost a'ton. It threatens a re- j duction in the weekly output of the mine, with a corresponding increase for overhead expenditure. "To meet this difficulty, Junction | shaft was worked for a second shift I during the last four periods of the voar This vear we are working the 1| No. 2 shaft'on three shifts instead of || two. At the same time, being forced M to increase output at some individual j point does not make /for tho best j® economic working, as the ore may not j--;-be of the particular grade required. 1 ;