THE BUTTER MARKET

Otago Daily Times, Issue 18851, 2 May 1923, Page 10

THE BUTTER MARKET

RISE IN PRICES. SOME INTERESTING FACTS. VAGARIES OF AMERICA. CFkom Ode Own Correspondent.) LONDON, February 27. In'an endeavour to explain to shareholders the difficulty which wholesale buyers of produce experience, because things move quickly and because no one knows what conditions may arise in the space of a few days, the deputy chairman of the Home and Colonial Stores took dairy produce as an illustration, and he referred particularly to the case of New Zealand butter. Mr Emery reverted to the anxious and exciting days of December when American buyers cleared the market of all. available supplies of Danish butter, with the result that there was a run by British, and to some extent also American buyers on Empire butter, which had arrived in large quantities early in the month; and prices went up by leaps and bounds—advancing as rapidly as they had previously fallen. “We have always,” said Mr Emery, “been large buyers of colonial butter and cheese. With a name such as ours you would-be surprised if wo wore not. Our only regret is that we cannot- do more with home produce; but our needs are such, that it is impossible for our company to get supplies of home produce as and when needed. Some distributors prefer Danish produce;, we favour colonial—New Zealand and Australian —and wo hold that ,no finer butter Domes into this country than the New Zealand. It will interest you to know that last year New Zealand shipped 116,000 tons of blitter and cheese to the Mother Country, 56,000 tons more than in 1914. “A friend who is interested in this company has just returned from America and he informs us (1) that although America is increasing her production the population ■is growing faster than the increase, and the spending power of the people is good; (2) that the cost of living is going up,; (3) That prohibition is causing a largo increase in the consumption of milk, and that large quantities of cream are being used for ices, etc . thus reducing the quantity of cream available for butter and cheese. The result of all this' is that America is driven to compete with us for their further supplies in markets which this country has always looked upon as ours. I am referring to our colonies, New Zealand, Canada, Australia. This, of course, makes our buyers somewhat anxious as to future prices. With regard to the year on which we have just entered, no one knows what the future has in store.” WHY AMERICA BOUGHT.

This statement provides a text for special comment by the Imperial Food Journal, which observes; “It is quite true that last December the Americans, faced with a shortage, were buying Danish butter, and in order to get the c»uantity they required they rushed up the Danish market, in addition to which, as we loam from a reliable source, they negotiated for something between 100,000 and 150,000 boxes of New Zealand butter at the price of Is 5d to Is sid per lb, f.o.b. Before that the London market had gone down very rapidly owing to heavy supplies of Australian and New Zealand butter, and actually went as low as 170 s per cwt for New Zealand and 162 s to 164 s for Australian butter. When information was cabled to London that the American deal with New Zealand had gone through, the market here as quickly recovered, and in London went as high as 198 s for the New Zealand product.

“But there has been a curious sequel, which Mr Emery omitted to mention America is now trying t& resell from 25,000 to 50,000 boxes of her purchases on this market, and it is even rumoured that between 10,000 and' 15,000 boxes of this New Zealand butter has already been sold to the United Kingdom, never having been landed in America. Some of it is afloat, and some still in New Zealand. The price has not been divulged, but it is thought in Tooloy Street to bo in the neighbourhood of 190 s, c.i.f. If that, be so, it would seem that America is not at present seriously short of butter, whatever may have been the case two or three months ago. It is known that the winter in most of the States has so far been mild, and dairy production seems to have increased fairly rapidly. At anv rate, there is no longer any market for New Zealand or other British Empire butter in the United States. It is true that such butter is up avainst an import duty of eight cents a pound, but that alone , would not be sufficient to keep it out if there was any serious shortage.” AN IMPERIAL BUSINESS.

The Journal wishes that other big concerns (in addition to the Home and Colonial Stores, the World’s Stores, and Walker’s Stores) would push Empire dairy produce a little more than they do. What better standard for imported butter, for example, it asks, could we have than New Zealand ? “The Danes, as a rule, are clever market men, and neglect none .of the aids of finance. We do not deny that they are also good dairymen, but what we do say is that they cannot produce a better export butter than Now Zealand does. Mu Webster’s testimony establishes that point, nor does he stand alone as a protagonist "on this side. _ Mor© publicity and organisation are required at both ends, not only , for New Zealand butter and cheese, but fbr all the dairy produce of the Empire, and there are signs that these ore coming. Whether or no New Zealand ever realises its ambition of becoming the dairy farm of the world, it can immediately he granted that the dominion has before it a. vastly greater future in the dairy industry than at 'present, and the resources of Canada, Australia, and South Africa in the same direction are immense. The result of what- has already been- done in the way of organised publicity shows how desirable and necessary it is to do still more.”

Mr W. Rains Webster stated recently that for 20 ■ years past his farm has consistently backed New Zealand butter in particular as the standard of quality. Indeed, it has entirely eliminated Danish ■butter from the stocks in its many branches, and calls New Zealand butter its best. LATEST PtwuES.

A sharp rise has occurred in the 'butter market within a few days, and Messrs W. Weddel report an advance of fully 14s to 13s per owt. For some considerable time back, notwithstanding a steady retail demand, operators, owing to the apparent high level of prices, have not been -inclined to commit themselves to more than their immediate requirements, tho result- being that recent arrivals, although heavy, have met a practically bare market. With a steady falling off in shipments, however, more especially from Australia, a fair amount of protective buying for the next month or two has been taking place and which doubtless largely accounts for the present sharp advance in prices. Inquiries have recently been afoot on this market for butter for shipment, to Canada, and this, together, with the present advance in the Danish quotation, has also helped to accentuate the position. Now Zealand is in good demand and is quoted at 210 s to 214 s per cwt for salted, and 212 s to 216 s per owt for unsalt od. There is also a good inquiry for Australian, more especially best- quality, it 204 s to 206 s per cwt for salted, and 193 s to 202 s per cwt for second grade. Third grade and inferior descriptions are also in good demand at from 192 s to 196 s per cwt. Best unsalted is scarce, and makes from 206 s to 203 s per cwt, but secondary and inferior grades of this description are rather slow of sale at from 194 s to 204 s per cwt, according to quality. In anticipation of decreasing shipments from tho Argentine, owing to droughty conditions, more attention has been given to this description, and prices have advanced accordingly, the latest quotation being from 134 s to 196 s pel- cwt, according to quality.