BUTTER PURCHASES

New Zealand Herald, Volume LXXV, Issue 23057, 7 June 1938, Page 7

BUTTER PURCHASES

BUIYING IN BRITAIN SUPPLIES FOR THE AUTUMN UNCERTAINTY OF THE MARKER [from oub. own corkespoxdent] LONDON, May 18 The report that there will be a decline in the quantities of New Zealand and Australian dairy produce reaching England after August was largely responsible for New Zealand butter topping the market this week at 134s per cwt. It is reported that merchants are buying up supplies from the Dominions to store until the autumn, when they will be used to cou/iteract a sharp rise in price such as occurred last September, when New Zealand butter sold at 1525. This buying tended to keep prices for New Zealand and Danish butter level* and, at the same time, resulted in a slight slackening in supply, which also had a hardening effect on the price* At the same time New Zealand butter has now established an independent market, and is bought by people who are prepared to follow tho market price. Competition with Cask Supplies It is reported that, in northern districts, where New Zealand is compete ing strongly with cask butter, there has been an attempt to under-cut the Dominion product. In some districts New Zealand butter has been sold at a penny per lb. more over the counter than its cask rival, and maintained its position at the same time. Commenting on the position this week, the Grocer says: " Tho continued shrinkage in New Zealand and Australian production has caused the Governments of those countries to revise their shipping programmes in order to ensure a continuity of supply; | throughout the coming months. The | outcome of this will be that lighter; | quantities will be available for this market. With this knowledge in mind,, buyers continue to support the josi* ' tion. It is a case of taking butted ■ while supplies are available and no# waiting until butter is short. Check to High Prices , " By this means operators hope Id l stop prices reaching the high level they ; did in the late autumn of last year. It , is buying for the future that has to a I large extent been the reason that the ; buying of cask butter has not been . so heavy or active as Colonial. Danish j butter is not yet of full grass, and . hence its storing qualities are not of the best. The peak of the Continental 7 production has, of course, not yet been, 3 reached. An additional element of un- \ certainty has been caused by the fact r that there is as yet no news as to i whether Russia intends to send as any butter this season. The higher , price in the wholesale markets has been J passed on to the consumer. It has ' caused a slight check in consumption, but as yet there has been no drastio drop." According to the Imperial Economic Committee, the weekly consumption of butter in Great Britain in April was 9170 tons, or slightly less than the 9325 tons consumed weekly in April, 1937. At the same time, the demand for margarine has increased to a certain extent, 3879 tons being consumed weekly in April, as compared with 3387 tons in April, 1937. Whether New Zealand butter will drop to below the Government's guaranteed price of 112s before the autumn depends to a large extent upon the supplies from the Continent. At the present time London market opinion is inclined to believe that will res main above the guaranteed price leveL r _ •" !S Since this report left London the ! price of New Zealand butter has fallen I to 122s per cwt., an improved prodno- ° : tion outlook on the Continent having ?, | relieved fears of any unusual shortage.-