DAIRY PROBLEMS

New Zealand Herald, Volume LXXV, Issue 23061, 11 June 1938, Page 18

DAIRY PROBLEMS

COSTS STILL MOUNTING MORE REGIMENTATION GUARANTEED PRICE POLICY ORIGINAL PLAN VARIED Increasing regimentation and Government control and the continual rise in costs are the two principal complaints of the dairy industry, according to the annual report of the National Dairy Conference, which will meet at New Plymouth on June 22. The conference will be conducted by the National Dairy Federation, which was incorporated last year. The Government apparently has realised that if the guaranteed price policy is to secure permanency and give reasonable satisfaction to the producer, he must be given a voice in determining the value of the product of his labour, states the report. Rising costs have offset some of the advantages of the scheme, and, with the intention of the Minister of Marketing to pay this year's surplus to the industry, it is clear, that' the Government's original idea bf equalised pay-outs season by season through the guaranteed price has gone by the board.

Wages 17 Per Cent Higher

The increase in manufacturing costs in the 1936-37 season was probably less than was generally expected, continues the report. The fact that an exceptionally good season was experienced, with an increase in production of over 16,000,0001b. of butter-fat, was undoubtedly a factor in keeping down the percentages. The actual increase was .26d per lb. iWages and salaries were 17.3 per cent higher, milk and cream cartage 19.2 per cent, and manufacturing requisites rose by 20.2 per cent. Other expenses, of manufacture remained unaltered, and as this covers -capital and overhead charges of a more or less fixed nature it was only to*, be expected that any slight increase;would be offset by the increased, production. - • < Costs for; the season now closing can-: n6t yet, be ascertained, atatea the report. 'However, a further ; substantial rise mjist be anticipated. In considering the rises, it should,be remembered that the increasing costs affected only the latter portion, of that season. On the; other hand,, the past year has been .i marked, by a further upward trend,-./which will not be offset by increased production, but rather accentuated by the decrease which at present appears inevitable. Delay in Payments

Dealing with payment for dairy produce, the report states that the Minis-ter.-of Marketing takes credit for the promptness with which payments are remitted to dairy companies after the produce is • placed on board Bhip, : and the industry has no fault to find with the method adopted. It is practicallv the same system, however, as was followed for many years by the local agents merchants before the days . of .Government purchase., . 1 The dairy companies are not in accord with the practice of deferring payments in all. cases until produce ■ v.: abtually "is shipped, irrespective of the time it is held in store, the report continues. The delays, which are due to the established policy of spreading || shipments, have been more pronounced ff than usual, and some of the less fori tanate; factories have experienced diffigjf culty in financing their payments to suppliers. With a genuine desire to | meet the wishes of the industry, the J; difficulties could be Burmounted. •1 Increased Production || ; Reviewing the production year, the report shows that butter gradings for the 1936-37 season were 164,564 tons, • v an/increase of 6.37 per cent on the pre- :* vious season. Cheese also showed an {§• increase, which was gratifying in view of the downward tendency of previous ;Jp ye&gpftjbhe total being 88,222 tons, an ; incj;6aise of 3.12 per cent. Converted % equivalents, production showed an _ increase of 4.89 per cent. Reference is made to the further im-

Tw-ovement in the quality of butter. : This wasr facilitated by an extension of the daily delivery, of cream and by the y zoning. jv The accounts :of the National Daixy jj§ Association of : New Zealand, Limited, | the . industry's trading organisation, „ show a net profit of £364, after proi viding for- all expenses, including £1657 •for rwpseciation. The total credit of theappropriation account now stands at £895, which, after allowing for in- !)• come tax, will allow a substantial bals ance ito be carried forward. The direcf tortVi»polPt Btates that, due in no small ji measure to increased support from lit merilber there has been |;a marked increase in the volume of C . business, continuing the steady projl (gress shown over the past few years.

I THE £500,000 SURPLUS

m POLICY FOR THE FUTURE

Mk. FRASER DENIES REPORT

rs [BY TELEGRAPH- —PBESS ASSOCIATION] g GISBORNE, Friday H A denial that he had stated that the surplus in the dairy account would be % distributed to farmers this year only was made by the Minister of Health, % the Hon. P. Fraser, in the course of an • address at Gisborne last evening, t Mr. Fraser said that in commenting :i; on the guaranteed price he had said it would not be fair to debit the dairy C account with last year's loss. This year '•X there was likely to be a surplus of ; £500,000, and, as prospects sdemed quite good, the Government would not ; put its policy into operation during the ; present year. He had said nothing about K future years. The Prime Minister, Mr. v Savage, would announce the policy for the future in due course. Whether the < policy of handing back the surplus v would be continued would be a matter "t for tha Government to decide. 7 /