PRIMARY PRODUCE

Otago Daily Times, Issue 22905, 12 June 1936, Page 7

PRIMARY PRODUCE

MARKETING BILL DISCUSSED SUPPORT URGED BY DAIRY ASSOCIATION "With the recent enactment, of the Primary Produce Marketing Bill, one of the most important pieces of legislation affecting primary production in this country became law," state the directors of the South Island Dairy Association of New Zealand, Ltd., in their annual report, which will be presented at the annual meeting of members in Dunedin on June 25. "In so far as it affects the dairy industry the Act provides that all butter and cheese manufactured on and after August 1 next, and exported from New Zealand, shall become the property of the Government when the produce is placed on board ship or at an earlier stage if the Minister so decides. Provision is also made whereby the Government may assume the ownership of dairy produce intended for consumption within New Zealand, or, as an alternative, control of the marketing of such produce. By Order-in-Council the Government may also take possession of other dairy products, including milk, cream, calves and pips. "The Act states that the prices to be paid for export butter and cheese during the first year shall be decided after taking into consideration the prices received in New Zealand during the last eight to ten years, and that prices for produce exported after July 31, 1037, shall be fixed after regard is given to the prices paid for produce exported before that date, and to the following additional considerations: —

(a) The necessity in the public interest of maintaining the stability and efficiency of the dairy industry. (b) The costs involved in the efficient production of dairy produce. (c) The general standard of living of persons engaged in the dairy industry in comparison with the general standard of living throughout New Zealand. (d) The estimated cost to the department of marketing the dairy produce concerned, and also the cost of the general administration of this Act. le) Any other matters deemed to be relevant

"It appears to be the general belief that the farmers were responsible more than any other section of the community for electing the present Government, and that the promise of guaranteed prices was the influencing factor," the "report continues. "We arc not in a position to sav definitely if that is a correct assumption, but we do know that very few dairy farmers realised that the putting into effect of a policy of guaranteed prices meant that they would lose the right to dispose of their produce as they thought lit. Nevertheless, we do not propose to condemn the Government's action. Wo believe that it is sincere in its expressed desire to better the conditions of the people engaged in the industry, and we think that all dairy farmers should co-operate with the Government to the fullest extent in the endeavour to make its policy successful. Attempts are being made to belittle the Government's marketing plan. We have given the matter our most earnest consideration, and have reached the conclusion that there is nothing in the Government's proposals which is opposed to the producers' interests. Provided the Government's Marketing Department can obtain the co-operation of the distributors of our produce in Britain, and we can see no reason to doubt that it will, the results should he greatly to the advantage of the producers, and incidentally to the country as a whole. "The policy aims at eliminating the speculative element from the business, and the redundant costs which now occur between the New Zealand producer and the British consumer. These are commendable. objects, and the dairy farmers are not so lacking in intelligence as to accept the suggestion made by a committee of the Dunedin Chamber of Commerce recently to the effect that their accomplishment would not be in the best interests of the industry and the Dominion. The question as to whether a guaranteed price for dairy products is satisfactory to the producer will be answered in due course when he compares his present position with that in which he finds himself as the result of the Government's policy. A factor which will have a considerable bearing on his decision will he the extent by which the guaranteed price has compensated him for the increased labour and other costs which, it is apparent, he will bo called upon to bear as the result of other. Government legislation. We are confident that the Government is fully alive to this aspect and that due allowance will be made by it to meet the situation. • . "The provisions of the Factories Amendment "Bill will raise the cost of labour in dairy factories very much above the present level, more particularly in the case of cheese factories, where it is not practicable to have a working week of six days. Cows have to be milked every day, and the milk made into cheese every day. If the wages of the employees in the smaller cheese factories are restored to the 1031 level, and provision made at the same time for a 48-hour week, it is estimated that the increased cost will amount to not less than Hd per lb butter-fat. At the Dominion Conference of dairy representatives, held in Wellington recently to discuss the Government's guaranteed price proposals, the need for a differential price for cheese was strongly emphasised, and the general opinion was expressed that the price fixed for cheese such be such as would allow a payment to the cheese factory of at least Hd per lb butter-fat more than to the butter factory. The Government has now decided *to allow a price differential of ljd. In our opinion a price differential of Hd is not sufficient to meet the position "of suppliers to small cheese factories, of which we have a number in the South Island, situated mostly in isolated districts. These factories serve a very useful purpose, and it would be a serious matter for their suppliers if they were compelled by force of circumstances to olose down." It is in the interests of the industry as a whole that they remain in operation, and we trust the Government will grant them the special consideration necessary. " In the last five years butter production in New Zealand has increased by about 50 per cent., whereas the production of cheese has remained practically stationary. Many suppliers, because of the more attractive prospects offered. have changed over from cheese to butter factories. If this drift is allowed to continue, marketing problems of a serious nature must result. This has been realised by leaders in the industry, but no satisfactory means of rectifying the position could'he found. Now that the Government has taken over the marketing of the produce, however, they can effect a remedy by fixing the price for cheese so that an "even balance will be maintained as between butter and cheese."