A CALL TO ACTION

Poverty Bay Herald, Volume LV, Issue 17434, 5 December 1930, Page 4

A CALL TO ACTION

PROBLEMS OF PRODUCERS ■ MR. GOODFELLOW'S REVIEW ECONOMIES ESSENTIA E (T’tir l’re.ss Association.) WELLINGTON, hist 11 i-lit. With tin 1 dairying industry facing ,'t crisis of 1 lie liist magnitude, extrema T<:ii.lsliii> ri'iihl only In- minimised hy the co(i |n' i'a live dairy nun |ia n ics acting in 1111 i s 1111 In sec ureme re efficient markcling ; 1 lid hy ”ellei;i i;ic t i 1111 tiil'OUglimi I the nun iiiim iI v |o ini lice I lie cos's ot' 11 in ii lii c t inn, sn id .Mi'. \\". ( iincl fellow, managing 1 1 i ree 1 11 r of A ni.a Iga mat mi Dairies, ;id l lressi ll e the secuinl annual meeting of the New Zealand Dairy Council to-day, when lie cave a full analysis of the position. The council resolved lo nice the Government to emlcuvor to arrange for ihe Itril isli Government, to tax foreign food imports, New Zealand agreeing in return to vednee the duly on Itrilish goods. The council a Iso decided to ilist iI ute act ion calling on London importers to devise methods to prevent marketing weaknesses, and stri >i i jjf Iy , favored the urea nisat ion of tin' niar-J keting end of the industry I>y cooperating with Amalgiiniated Dairies,! or adopting some other marketing srheme. | ‘"file producer is now receiving less than pre-war value for his goods,’’| said Mr. Goodfellow, “and it is quite impossible to maintain, much less expand, the dairy industry, unless immediate steps are taken to reduce farmers’ costs.’’ This could best be ;c-: complished by—(l) An all-round reduction in Government, municipal, and county council expenses; (*J) a reduction in the duty on all dairy factory and farmers’ requirements, suine of which were now levied us high as *2O

and dll per cent.; (b) the establishment of the railways under independent commercial control to avoid the annua! deficit, whose burden was borne by the whole community; (C by suspending the Arbitration Court., and allowing a natural basis to be established; (,'} by removing the duties on wheat and flour, thus reducing the cost of living, and permitting the expansion of essential industries, such as pig and poultry production; and fill bv the establishment of a strong coalition Government. NOW LONG WILL IT I,AST .’ In view of the heavy reduction in prices of all primary products, and its reflex on the national income. i r was impera t ive tha I the presenl threepa rty system be terminated as quickly as possible. Only a strong Gov-i-iiinieiii could reduce expenses. It was vital for a strong Government 1o get together, and cut down national expenses right and left. , luan exhaust ive review of Ihe dairy posit ion, Mr. Goodfellow pointed out that, in spile of l.ritain's liea’vy imports of butter, there was room for considerable expansion of butler consumption in lhe Doited Kingdom, provided always that the price was competitive with margarine. There was no question that the problem facing the dairy industry exceeded in magnitude any previous problem which had confronted it. There was the dil'li'•iilty ere,-iled by dairy production throughout tiie world racing ahead of r-cii sii in pi inn, aml lhefu it her difficulty of a general collapse in the world’s - nine of nil eonimodil ies. The reason for this world-wide depression was at tributed to three main causes:—( l I Shortage of gold; restricted ] >urchasing power of 25 per cent, of the world’s pujuila t ion ; (b) the adoption of exclusion tariffs lay certain conn 1 1 ies. What the dairy imlust ry, of course, Mould like to know, said Mr. Good-, fellow, was how long the present world depression was going to last.! Some authorities indicated that spei-i-, fu improvement could be looked for in the United Kingdom in about two yea rs ’ t i me, but I lie re was no doubt, in his opinion, that the future pros-’ parity of New Zealand would depend very largely upon the ability of this co unl if to set its house in order. In IlbJI the slump was short-lived, due to the world shortage of food supplies. On this occasion, however, the markets were amply supplied owing to increased production. OBSOLETE METHODS Dealing with the need for more efficient- marketing Mr. Goodfellow said that, combined centralised buying, I multiple simp companies, and eo-opera. | live societies in the United Kingdom necessitated a change in the. highly com-! pelitivo system of selling New Zealand dairy produce. Under presenl conditions I lie method of marketing; New Zealand dairy produce was now hopelessly out of date, and required rationalising so as to eliminate, as far as possible, all unnecessary competition. This was tho only method of securing to the producer a fair market value foe 1 1 is goods. The Danes were securing superiority of from 30s tn 40s per cut. because their marketing method was better and not, competitive ill the' sense that ours was.

Mr. Goodfellow said I bat some of the best agents in London were utterly disgusted with the way co-operative dairy companies in New Zealand, who had no worth-while selling organisation in London, secured produce from factories hy means of a clever plausible commission agent and then deliberately undercut prices by shooting the goods out through a I coker prior to their arrival and. at a nominal cost of pec cent. r J lie market had been depressed by such people and, in order to hold their accounts, the best Tooley Street firms had had no alternative imt to do likewise or lose their business.

Last ;i iil himn -\ m;i I l;:iiii:i f *‘<l Dailies liail resisted the fall in butter, with the result llial all New Zealand bciioiilod In the extent, of a Inure sum. '1 lie result, ol that aetinn of Amalgiiiated Dailies had lieen that tile market had eased slowly. The only cheerful feature about, the (inaneial position was the, jireimum se' nr ed to the producer bv the exchange posit ion. If t lie posit ion remained as 'I was. lids premium to the dairy industry would amount. in the coming season, In approximately hot It 1.000. The policy of the hanks in encouraging the export of primary produce and imposing an exiha ngc , rat e against the importer ol overseas goods was absolutely sound. RRODIH KRS .Ml ST COM RINK In discussing the future, Mr. flood fellow emphasised that producers stood to gain more by organising their marketing functions properly than by any other single course, ol action. Cooperative directors would have, to lake a more intelligent interest, in the marketing end of their business. All co-operative companies should cable their London agents urging them to get together and reduce competition in the sale of New Zealand' dairy produce, faihles recently received showed that Toolev Street, would not. move in this matter without definite instructions from the, owners of the goods. The fact, was that New Zealand . had the worst

marketing system of any dairy produce exporting country. Every other country exporting dairy produce in substantial quantities bad export organisations controlled by experienced commercial men. capable of exercising control' over sale of goods. In New Zealand some 500 factories divided their output among some 30 agents, without exercising any supervision upon its sale. At the conclusion of Mr. Goodfellow 5address, Mr. Dynes Fulton, who was in the i hair, stressed the need for producers effectively to combine to secure betterment in marketing methods. The directors of Amalgamated Dairies wore prepared to co-operate with any organ Nation nr group that t mild propose any bet t erment. A soeeial vote of thanks was accorded Air. Goodfellow for bis service to the industry and confidence was expressed in him for Ids future guidance. Resolnt ions on the lines of Mr. 11 I fellow's suggestions were adopted, including the suggestion that the Government should call a eon fere lice to include tile ablest men representative of all interests in the community, with the object of exploring ways and means of minimising hardship and of obtaining a return to national prosperity.