DAIRY CONFERENCE

Otago Daily Times, Issue 22211, 14 March 1934, Page 8

DAIRY CONFERENCE

FUTURE OF THE INDUSTRY

THE MARKETING QUESTION

j (Per United Press Association,)

WELLINGTON, March 13. The dairy conference arranged by the Prime Minister (Mr G. W. Forbes), as preferable to the Royal Commission suggested by the Farmers’ Union, was opened at Parliament Buildings this morning.

Mr Forbes, welcoming the delegates, •tated that the reason the conference was called was concern at the very low prices dairy produce was bringing. The conference was a large one, but it had been thought that it would be better to have those with practical interests in the dairy industry meet, so that they might have the information the Government possessed, and the Government could hear what they had been thinking in regard to the future of the industry. He assured the conference that the Government had been giving a great deal of thought to the dairy industry, because not only did low prices affect the position of the farmers themselves, but also the Government in its finances. The proposal was to devote the day to a general discussion of the industry, and suggestions that might be made for Its improvement, and they could resolve conference into a comhriittee. The details could then be taken in hand, and com- ,, mittees set up to go into particular points and report. Mr Forbes went on to refer to the epinion frequently expressed that New Zealand, by offering Britain practically a free trade tariff, had ensured that there would be no question of a quantitative restriction of dairy produce into Britain from New Zealand. He proceeded to read exchanges of cablegrams with the British Government. in which the British Ministers made it clear that the question was not one of trade, but a question of the position of the British farmers. These cable--v grams showed that, owing to the milk marketing scheme, an import regulation was no longer a matter of immediate ' concern at Home, but was a matter for the dominions themselves. If they could come to some agreement in regard to the regulation, it might be possible to hold the market for British and Dominion farmers. The New Zealand Government, Mr Forbes said, had pointed out that unless !t had the co-operation of the dairy industry itself in this country it was not possible for the Government to come to any agreement i Mr Forbes pointed out that the present position was secure for the next two i years. He stressed the necessity of maintaining the goodwill of the British - farmer. If New Zealand got out of step with the people in England it was bound to affect the popularity of our produce. What they had to do was to devote themselves to the question of how they were going to improve things. Ho went on to say that undoubtedly there had been a drop in quality. He also .. said that New Zealand had to do very much more to push its products in the face of. the increased competition from Europe. Mr J. G. Coates also extended a welcome to the delegates. He pointed out that the dairy, farmers of New Zealand this season would get a return of not more than 8d per lb. Over 70,000 farmers were directly involved. Many of them might be able to get along, -but a very great number would find the utmost difficulty in making ends meet. He ; ■„ would like to know how an industry could make progress producing at a loss, er how long it could get along at all. Referring to the Ottawa Agreement, he said it might really, be termed the farmers’ Bible. \ It had led to an extraordinary improvement in prices, so far as meat was concerned particularly. He quoted a clause’ "in the ' agreement to show that in the event of circumstances arising which in the opinion of the Government either of Britain or New Zealand necessitated a variation in the terms a proposal to vary them could form the subject of consultation between the two Governments. Mr ,-Coates referred to Britain’s action in subsidising its milk industry for the purpose of converting the surplus milk into cheese. As he saw history, once England made up her mind there was no going back, and he emphasised the example of bacon to show what might easily take place in regard to the production “of cheese. Mr W. J. • Poison, president of the Farmers’ Union, said one necessity the dairy industry was determined about was that costs must fall. Tariff reduction was essential to lower the costs I- In this country. Mr W. Grounds said that the acceptance of a quota would not have solved the problem. Only along the line of satisfactory distribution of the increased consumption the world was capable of could success he achieved. The Dairy Board had hesitated to accept anything that might drive the country to the necessity of defaulting in its overseas obligations. Mr Poison expressed the opinion that there were three phases to be considered first, the question of internal relief for the farmers; secondly, an expansion of the industry; thirdly, the position of the fanning industry in New Zealand as a whole if the Dominion was already producing more butter-fat than the overseas markets could consume. It was well within the power of the conference, he said, to deal with the first phase. Other countries had afforded relief to the dairy industry and attention should be turned to this aspect in New Zealand. The question of external expansion depended on whether tariff bargains could be made With other countries. He believed that certain subsidiary channels would be open if the matter were approached in the proper way and with assistance from the Government, He believed that a further diversification of the farming >ndustry was most important in order that all the Dominion’s eggs should not be in one basket. He was satisfied that the necessity for an improvement in the quality of produce was beginning to be realised in the Dominion. The industry must be rigidly disciplined if there was to be a marked improvement. He thought that experiments with shipping processes might result in the produce reaching the other side of the world in the same condition as when it was shipped. Mr Poison declared that costs within the industry must fall. Tariff reductions were essential. Mr W. A. lorns,, chairman of the Dairy Board, said he was convinced that come immediate relief would be given by a local price stabilisation scheme, for which he believed the time was opportune. Mr A. B. Roberts (Parkvale) said that farmers appreciated the benefit of the high exchange, but at the same time realised that they were living at the cxpense of somebody else. Only a national scheme capable of restoring'the industry to a payable basis would adequately meet the situation. «* Mr C. P. Agar (Christchurch) said that, the main problem facing the conference was how to raise the price level in the 1 immediate future. “My suggestion is that the exchange be put back to 10 per cent, and that in addition to the 15 per cent, which you would give to the dairy farmers you should give further assistance to the Industry cither by way of a subsidy or by a loan in order that we may be able to stabilise a price level for butter-fat during these lean years. If you do not assist the dairy industry

then your troubles will be increased many times over what they would be if you raised money internally in order to maintain a satisfactory price level to the dairy farmers. It is a fair question to ask Cabinet: Will you give legislative authority to the industry in order that we, among ourselves, can bring about a Dominion scheme for the marketing of our dairy produce and take one step forward at least toward improving the price of butter-fat?” “ The last cablegram we received from the United Kingdom,” said Mr Coates, “pins the situation down to this. The Ottawa agreement will run out, and then it will be for New Zealand producers to say whether in the circumstances they should appoint a representative as a commissioner to meet the United Kingdom farmers. That is a very definite proposal that is placed before New Zealand at the moment, and it is for this meeting to say what action, if any, should be taken.

“We are here to co-operate,” said Mr Coates. “ The Government, rightly or wrongly, has said that this is a matter which clearly and definitely concerns the industry. In the remedies we apply we have to consider all forms of industry and everybody concerned. We have to consider the whole economic structure of the country. Great Britain will not make a separate agreement with New Zealand and leave out the other , dominions. Since the first Imperial Conference that has been the basis upon which all conferences have come to their decisions. That was the position at Ottawa and that is the position to-day. We have an Empire to deal with and not just a United Kingdom. t Mr W. J. Poison: Yet they are prepared to make agreements with foreign countries?

Mr. Coates: That is rather different, isn’t, it? I stake ray reputation and the whole of my public life upon the very definite statement that we cannot make a separata agreement with the United Kingdom on the basis of tariffs. That does not come into the question at all. Whether our tariffs do not require a complete overhaul is an entirely different matter. Tariffs are a matter of internal policy.” , Mr Forbes said that Mr Coates had correctly interpreted the attitude of the British Government. “We all belong ro the British Empire,” he said, “ and each part gets equal treatment so far as British trade is concerned.” At this stage the conference went into committee, the Minister of Agriculture (Mr C. E. Macmillan) taking the chair. An adjournment was then taken until the morning. THE BRITISH VIEWPOINT Referring to the desire of the British Government to establish import quotas for dairy produce from the dominions, The Times Trade Supplement recently remarked: — Negotiations on the subject have been proceeding for some time, but something in the nature of a deadlock has arisen. The dominions’ representatives are standing, as they are entitled to stand, on the full performance of the Ottawa agreements, while the Home Government, anxious to secure better conditions for agriculture, asks that there shall be a quantativo regulation of imports of pastoral products from the dominions as well as from foreign countries. In this connection it may be recalled that the policy of the Government was clearly stated at the time of the Ottawa Conference. It was: Home industry first, dominion industry second, and other countries afterwards. New efforts to reach an agreement arc about to bo made.”