DAIRY ACCOUNTS

New Zealand Herald, Volume LXXV, Issue 23228, 23 December 1938, Page 7

DAIRY ACCOUNTS

SURPLUS £555,185 PAST SEASON'S OPERATIONS IMPROVED DISTRIBUTION [BY TELEGRAPH —PRESS ASSOCIATION] WELLINGTON. Thursday Tho Minister of Marketing, the Hon. W. Nash, has issued the annual report and statements of accounts of tho Primary Products Marketing Department for tho year ended July 31, 1938. "In the terms of tho Primary Products Markoting Act, the roport and accounts are to be laid before Parliament within 14 days after they iiavo been received by the Minister if Parliament is then sitting," said Mr. Nash. "The Parliamentary session ended on September 16, before tho roport and accounts could bo completed. I am now issuing theso statements and they will be laid before Parliament when it next meets." Deficit and Surplus Tho report of tho dairy produce export division reviews tho completed financial operations for the year ended July 31, 1937. Tho deficit for tho 193637 season is shown to bo £272,482. In tho terms of the undertaking given to tho dairj' industry, this deficit is tho responsibility of the Government. The roport reviews tho operations of the 1937-38 season and discloses the estimated surplus as £555,185. This estimate was based on valuations of unsold butter at 110s per cwt. and unsold cheese at 70s per cwt. Sales made to date support the estimated surplus which has been quoted Full details are given of the marketing operations of the department", and references aro mado to improvements in tho distribution of butter and cheeso and in the price returns which have resulted from tho new markoting procedure. Manufacturing Ooßts Guaranteed prices for dairy, produce aro tabulated, with tho corresponding average payments for butter-fat made by dairy companies to their suppliers. Dairy company manufacturing costs aro shown and comparisons are made with previous season's costs. Special references are mado to cheese manufacture and to tho efforts of tho Government to maintain cheese production. The report and accounts of the Internal Marketing Division cover a period of 14 months. The accounts show that the trading operations of the internal marketing division have resulted in a net profit of £6804. The 1936-37 Season Tho accounts for tho 1936-37 season show that in the case of creamery butter and cheeso the actual realisations for produce which was unsold at the balance date exceeded the estimates. In the case of whey butter the actual realisations were less than the estimates. Tho net result is that at the date of the closing of tho accounts (June 21, 1938), tho actual deficit for the 1936-37 season was £272,109. In tho accounts published with last year's report tho deficit for the season was estimated at £548,750. Interest at li per cent is allowed on the deficit of £272,109 from June 21, 1938, to the end of July, bringing the deficit for tho 1936-37 season •at July 31, 1938, to £272,482. Administration Expenses

The accounts for the 1937-38 season cover all export butter and -cheese which was manufactured from August 1, 1937, to July 31, 1938, the quantities being: Creamery butter, 137,542 tons; whey butter, 1796 tons; cheese. 83,078 tons. The accounts submitted comprise separate purchase and sale or "pool" accounts for creamery butter, whey butter and cheese, administration and general expenses account, and dairy industry account. The balancesheet to each purchase and sale account is charged its proportion of the total administration and general expenses, amounting to £192,141. Tho administration and general expenses account shows itemised expenses and charges in the United Kingdom and in New Zealand:- It is stated that the itemised expenses for the 1937-38 season are not comparable with the corresponding items in the accounts for the 1936-37 season, because the department was not fully organised and staffed at the beginning of that season. In the advertising, publicity and sales promotion section of the report, reference is made to the increase in the financial allocation for these activities, the expenditure being £91,259, compared with £39,049 for the 1936-37 season. Success of Marketing Policy "It is pleasing to record that the success of the policy adopted in the marketing of butter and cheese, which was clearly indicated in the first year after the inauguration of the new procedure, has been fully maintained," states the report "Merchants, agents, dairy industry officials and others qualified to judge are in general agreement as to the soundness of the single-unit system of marketing, with general sales instead of sales by individual dairy factory companies, and with consignment selling in place of the mixed consignment and f.o.b. and c.i.f. selling, which was a disturbing feature in the marketing system in the past. "The fixed and uniform monthly rate of payment for butter-fat that dairy factory companies have been able to maintain enables dairy farmers to budget with certainty for their farming and domestic expenditure. Tho guaranteed price policy has worked smoothly and tho administrative procedure has been conducted without a hitch. "Tho basic guaranteed purchase prices for butter and cheese are subject to additions and deductions according to the quality of the dairy produco Ms disclosed by tho grading points by tho Government graders. The experience of tho past two years justifies a continuance of price differentials. They provide an incentive for the maintenance and improvement of quality, which is appreciated by representatives of dairy factory companies." In announcing in September tho guaranteed price for butter and cheese for tho present season, tho Minister stated that the estimated surplus in the Dairy Industry Account for the 1937-38 season would be £600,000, representing £565,000 for butter and £35,000 for cheese. Stocks remaining unsold at July til consisted' of 13,700 tons ol butter and 15,300 tons of cheese, Mr. Nash then assumed that the unsold butter would realise 122s per cwt. and cheese <ls I )or cwt - . i.irono At the time of tins report 125,000 tons of butter had been sold at an average price, of 117s 9d per cwt., showing a surplus of £440,000. A total of 69,700 tons of cheese was sold at an average price of 68s 3d per cwt., showing a deficit of £24,000 The surplus at that time, therefore, was £416,000. NEW PRIVATE COMPANY The following private company has been registered in Auckland: — IT. E. Cooper and Company, Limited, indentors. Capital, £IOOO in shares of £l. Subscribers: H. E. Cooper, 005 shares; A. Iv. Voyce, 6.