SOUTH ISLAND DAIRYING

Otago Daily Times, Issue 23203, 29 May 1937, Page 12

SOUTH ISLAND DAIRYING

The extent of the marginal, difference between the payment made by the Government, under the guaranteed price scheme, to butter producers and that made to cheese manufacturers is a matter of so much concern to the whole dairying industry that it is likely that, in the light of the Government's present decision in the matter, it will be vigorously discussed at the meetings of farmers' organisations in the next few weeks. Since the inauguration of the guaranteed price plan the marginal payment in favour of cheese has been ljd per pound of butter-fat. This premium or "differential," as it is called, is paid in order to stabilise the production of butter and cheese in view of the fact that the cost of the production of cheese exceeds that of butter. It is acknowledged by the Government, however, that a margin. of l'id per pound is not sufficient, and it was announced by the Acting Prime Minister this week that, acting oft the recommendation of the Guaranteed Prices Investigation Committee, of which Sir Francis Frazer is chairman, it had now been decided that the marginal payment should be 2d per pound of butterfat. It seems very doubtful whether this decision will be acceptable to the cheese manufacturers. The directors of the South Island Dairy Association strongly express the opinion, in their annual report, that, in order that justice may be done to the cheese factory suppliers, the " differential" should be not less than 3d per pound. The difference between this estimate of the amount of the premium which cheese manufacturers should receive and the Government's estimate is so large as to be not reconcilable. Probably the Government has calculated the fresh costs which its legislation has thrown on the dairy industry at a figure much more modest than is being realised in the experience of the cheese factories. Another matter upon which comment is made in the report of the South Island Dairy Association calls for the very serious attention of the cheese factory executives The proportion of " finest" gradings of South Island cheese dropped in the past season to 28.70 per cent. The directors of the Association apparently dispute the justice of the gradings, because, they say, they are not aware that f the conditions Under which the milk is produced on the farms are not as good as they were five years ago, when the proportion of "finest " was 61 per cent., and, on the other

hand, " the methods of manufacture at the factories and the efficiency of the staffs have improved and the quality of the materials used in the manufacture of the cheese is definitely better." In circumstances such as these, a deterioration in the quality of the product was clearly not to be anticipated, and some explanation of the gradings is unquestionably desirable. The maintenance of quality is, as we have frequently insisted and as must indeed be obvious, of the greatest possible importance.