DAIRY PRICES

New Zealand Herald, Volume LXXVI, Issue 23507, 18 November 1939, Page 10

DAIRY PRICES

BRITISH PURCHASE I GUARANTEE MET DETAILS OF RATES MINISTER'S STATEMENT [ilT TELEGRAPH —OWN CORRESPONDENT] WELLINGTON, Friday Prices at which the United Kingdom Government would purchase New Zealand butter and cheese were announced by the Minister of Marketing, the Hon. W. Nash, in a broadcast address to-night. Tho Minister also described in detail tho arrangements agreed upon in connection with tho sale of the produce. . For finest New Zealand butter, tho United Kingdom Government would pay 112s 6d sterling per cwt., f.0.b., Mr. Nash said. The overall average price would bo 112s 3d sterling per cwt., f.0.b., equal to 139s 7*d, New Zealand currency. This would equal approximately Is 3d per lb. New Zealand currency. Butter prices, as announced by the Minister, and expressed in New Zealand currency, would approximate as follows: — Rates in Various Grades Finest, 93 points and over, 139s lid per cwt. First grade, 90 to 92£ points, 138s Bd. Creamery, second, 133s lid. Whey, first, 131s lid. Whey, second, 127s lid. For cheese, finest and first grade, 91 points and over, the price would be 64s 3d sterling per cwt., f.o.b. The overall average would be 64s 2d, or 79s 9d New Zealand currency. The Minister said that this would be a tremendous lot better than he anticipated a week ago, and would be equivalent to a price of Bjd per lb., f.0.b., New Zealand currency. Second grade would be approximately 77s 9d per cwt., New Zealand currency. Quantities Agreed On

The scheme would operate for the period of the war and for a suitable period afterward, during which an adjustment from wartime to normal trade could be brought about, the Minister continued. The quantities were likely to be the total export surplus of butter and cheese after New Zealand had satisfied her own requirements and those of certain regular customers. In the case of butter, in the year ended July 31, 1940, the United Kingdom Government had undertaken to ship 115,000 tons at the-agreed sterling f.o.b. price, and in the case of cheese, commencing with arrivals after November 20, to purchase 84,000 tons at the agreed price. It was estimated that the total quantities would cover the full season's manufacture. If_ ships were available, the United Kingdom would do everything possible to ship any additional quantities.

Payment to Dairy Companies "Irrespective of what is shipped over-seas,-all the butter and cheese produced in tho Dominion will bo paid for at the guaranteed price announced in New Zealand,'' Mr. Nash continued. He said that the United Kingdom assumed responsibility for the shipping, freight and insurance, and other charges from f.o.b. It was hoped that the shipments would cover monthly quantities in line with tho present arrangement. Payment by the Marketing Department to the dairy companies for butter and cheese would bo made at the guaranteed price fixed for the 1939-40 season, tho Minister said. The prices being paid by the United Kingdom should just cover the guaranteed price paid to the dairy companies. 90 Per Cent on Shipment The United Kingdom Government paid to tho New Zealand Government the sterling f.o.b. price, the money being placed to the credit of the Dairy Industry Account in the Bank of England. A total of 90 per cent was to be paid on shipment, and 10 per cent 28 days after arrival, or, in the event of a steamer being lost, on the estimated duo date. In the event of delay in shipping, the United Kingdom Government undertook to make a payment on account of 50 per cent for produce that had to remain in cool store more than two months.

Detailed conditions of tho purchase were in line with the standard practice. Provision was made for adjustment of claims in the event of defective quality, and tho New Zealand Government would maintain inspectors and graders as in the past. In addition, the United Kingdom Government undertook to consider making a payment for storage in the event of butter and cheese being held an undue time. London Marketing Staff • No unsalted butter was required unless some particular quantities were called for by the United Kingdom, 3\lr. Nash said. The salt content was fixed at a maximum of 2 per cent. "I think it will be agreed that from many points of view tho arrangement will be considered satisfactory," the; Minister said. Ho mentioned that for tho period of the war, Mr. H. E. Davis, manager of the New Zealand Dairy Sales Division in London, had been appointed director of distribution of butter and cheese in the United Kingdom, and his assistant, Mr. J. W. Hodden, had become deputy-director. The whole of the marketing staff had been co-opted by the Food Ministry. Australian Prices

Comparing prices to be paid by the United Kingdom for New Zealand and Australian produce respectively, the Minister said that for choicest Australian the price would be 137s 2d (Australian currency) per cwt., f.0.b., and for New Zealand the f.o.b. price would bo 139s 7id, or 2s 5-id per cwt. in favour of New Zealand. In the case of cheese, Australian, 90 points and over, would sell at 74s 4d (Australian curicncy) per cwt., f.0.b., and New Zealand, finest and first, would bring 70s 9d per cwt., f.0.b., a margin of 5s 5d per cwt. in favour of New Zealand.