CHEESE STORAGE

Southland Times, Issue 17734, 11 August 1917, Page 6

CHEESE STORAGE

QUESTION DISCUSSED BY DAIRYMEN. WHO ACCEPT HARBOUR BOARD’S OFFER. BUT WISH TO OWN THE STORES. Between 30 and 40 representatives of Southland cheese factories assembled in Allen’s Hall yesterday in response to the invitation of the President of the Association (Mr T. W. Foster) to meet and discuss the question of the provision of further cool storage for Southland cheese for the coming season. Mr Foster, who presided, opened by giving a resume of the business transacted at and arrangements made subsequent to the recent conference of cheese producers with the Prime Minister in Wellington. He detailed the matters leading up to the fixing of the producers’ offer which was based on the Canadian sale, and which simply asked the f.o.b. equivalent of the 10|d, f.0.b., which was stated to have been the price paid to Canada. Mr Massey had given the offer his approval and cabled it Home, apparently very sanguine as to its acceptance by the Imperial Government. He had told the conference that it might have to wait a matter of ten days or so for an answer, and although that time had now more than expired, Mr Foster read hope in the Premier’s strong confidence that the offer would be accepted. Then with regard to storage: They had waded upon the Premier to find what was the Government's intention in that direction. Mr Massey had said that the Government was prepared to treat the whole of New Zealand as it had treated the Wellington producers. It would provide free money for the building of stores on condition that it was repaid in from one to three years although the Government would prefer that the period of repayment should not extend beyond two years. The Southland outcome of that was that the speaker and Mr Middleton had waited upon the Bluff Harbour Board with the result that the Board had decided to proceed with the erection of a new store to accommodate 23,000 crates on condition that the producers paid a surcharge of 14/- per ton of cheese passing through the stores in one year or 7/- per ton for two years, such surcharge to be collected with the other dues. The surcharge was to repay the money which the Government would advance. At first sight 14/- per ton probably appeared a fairly stiff item, but it only represented 1-14 of a penny per lb.

If the Bluff Harbour Board built the store itself the producers would have to pay interest on the money for all time, by which they might feel it very heavy. The Board’s proposal seemed to offer a much easier way out of the difficulty. Fourteen shillings a ton would produce £4200, which would leave only £2BOO, which the Harbour Board would have to provide and which the producers would have to carry the interest of afterwards. The Premier had said that they might have a chance for shipping in September, but from that on they were going to have great difficulty in the face of which it was of the utmost importance that storage should be provided for at any rate half the produce which they would be sending away. The existing store and the proposed new one would store fully half Southland’s season’s export of cheese. An objection to the erection of a further store might be that in normal times it would be lying idle, but his opinion was that it would be a very handy standby. New Zealand had had industrial troubles and there was every indication that she would have them again, in which case the presence of additional storage room might be very timely. However, it was for the meeting to approve or otherwise of the Harbour Board's offer.

Mr Buckingham, as a member of the Harbour Board, said that the Board felt that the store would not be much good to them after the war. It might be worth £2OOO, so the Board was asking the factories to make up what was required over that amount. He moved that the offer be accepted, and that the Dairy Association be empowered to notify the Bluff Harbour Board that the work could be gone on with at once, the' amount to be paid off in one year. In speaking to the motion, Mr Buckingham said that he didn’t think that any hardship would accrue to the factories if they carried the motion. Last year they had paid If per cent, to the buyers and jd on butter-fat, which was just about equal to id lb on cheese. This year, with a storage due of 22/- per ton, they would be paying less than id per lb and building a new store besides paying their usual storage charges. He was of opinion that they should pay the whole thing off in one year. They did not know what the conditions were going to be next year, but they were almost sure-of getting about lOd this year for their cheese, from which it would be an easy matter .to pay for the new store. Then they had to remember thaft if they built the store and paid the money away this season, it didn’t go into their profits, and they would not be taxed on it. By far the better way would be to pay the building off in one year and have done with it.

In response to a query from Mr Arnott (Eastern District), Mr Buckingham said that there was no earthly chance of the Harbour Board making another offer which would be more acceptable to the dairymen.

Mr Wards (Island) seconded the motion pro forma. He had no intention of supporting it as he felt that it was not along the right lines. In the first place they had a store which had cost something like £SOOO or £OOOO. They had no control over that store, and yet they were paying for it. Now came the proposal to erect another of almost the same size towards which the Association was asked to pay, in one hit, half cost, which meant that the Association was going to hand over to the Bluff Harbour Board a ,£3500 store for nothin;:. If the Association had representation on the Board it might be on a better footing, but it had not that representation, although almost every other body iu Southland hail. They might consider a proposal to erect a store somewhere else than Bluff. Iu any case the cheese had to be trucked from the store to the ship’,- -Me. His directors were of opinion that it would be belter for the Association to own the store even if it were to he in Invercargill. When times j came back to normal the store would most likely not bo needed for storing cheese, and the question arose as to what would be the best situation of a store which could be used for other purposes. It would be far better for the Association to pay the whole £7OOO itself and own the store than to accept the offer of the Bluff Harbour Board. Mr 11. Fowler (Kenningtonl said that Air Wards had pretty well hit the nail on the , head. The Association should make the store its own. Could they not get from the Harbour Board a long lease—he presumed that they could not get the freehold —of the property adjoining the present store and that under it too with the understanding that the Association was go ; u. to build a new store and buy thdt present one as well. They would not need to do it all at once. The Association was now asked to find a sum of £4OOO. The present Bluff store had cost about £SOOO, and the new one was to cost £7OOO. Then in three years at the rate which they were asked to pay this season the Association could pay for the whole box and dice and have both stores under their full ownership.— (Hear, hear. That’s the idea!).—Continuing, Mr Fowler outlined Ids proposals for the financial realisation of this idea, and urged that payment should not be spread over too long a period whatever scheme the meeting decided upon. If the war continued he felt that the Imperial Government wtts not likely to take their cheese again, they would just have to take the risk. If, on the other hand and as they all hoped, the war was over, prices would not be by any means so high, so that they would be better to pay r,lt what they had to as quickly as possible. He was not one of (hose who held the idea that the store would lie idle after the war. No one knew what stores would yet be required for in Southland. Fruit and honey were hut two commodities which suggested themeslve.s. If

) they once got the store built he thought that they were business men enough to hnd < some future use for it—(Applause.) Mr W. A. Saunders (Invercargill) expressed the opinion that the Harbour Board's proposal was a most excellent one for the Board, but a very poor one for the factories of Southland. — (Hear, hear.) —In defence Mr Buckingham said that the offer was in the nature of a “good thing" for both. The Board would not have made the proposal had it not been favourable to the factories. Mr Dunlop (Seaward Downs) spoke against accepting the Harbour Board’s offer, and suggested that the store be built at Mataura. That might seem a long way away, but if they could sell it to the Southland Frozen Meat Co. when it was no longer needed for cheese they would probably get a good part of its value. The Eastern District factories could store at Mataura and the others at Bluff. —Mr Buckingham remarked that unless they could get the Government to declare their Mataura store a grading station they would have to pay 18/- a ton at Bluff all the same. Mr McNuughton (Aparima) got back to the motion which he said he was hardly in favour of. Paying off in one year as the motion provided lor would mean a pretty heavy thing for some factories. He would support the motion if it were amended to make repayment in two years. With regard to the proposed building of their own store, they would be working largely in the dark until they found how they stood with regard to land, etc. Mr Wards then moved an amendment that a committee be appointed to go thoroughly into the matter and report to another meeting in ten days or a fortnight’s time. This was seconded by Mr Gray (Mataura). Mr Gilkison (Pine Bush) thought that they were forgetting altogether that they were working m abnormal times. The appointment of a committee would hang matters up. They were going to get a good price for their cheese, and even if they aid make the Harbour Board a gift of part of a store they would not feel it very much. What was vitally important was that no time should be lost else the extra storage would not be ready when they needed it. In any case, no matter who controlled the store, there would be charges to pay. He was in favour of Harbour Board control, and he reminded them that they, as producers, were—or should be—just as much interested in the welfare of the Bluff Harbour Board as were its members. —Mr Winning supported. Mr Eades (Edcndale) was of opinion that the Association should own its own stores (Hear, hear.) —and have nothing whatever to do with the Bluff Harbour Board. To him either Bluff or Invercargill should be the site of the new store, but it should be the Association’s own. In the course of further discussion opinions were expressed one way or another and the chairman stressed that time was valuable. They were going to encounter shipping difficulties far earlier than they had the previous year. Mr Gilkison said that they had the Harbour Board’s assurance that in the past the factories had had to pay storage charges to cover only interest, working expenses, and depreciation. If now they paid this £4700 to the Board they would not have to pay interest on that amount in the future, so that it would not be thrown away. Following on this Mr Fowler suggested a blending of the two ideas. Let them authorise the Harbour Board to go on with the new store in the meantime and then consider, the matter of buying the present store and the new one after it was built. Mr Leighton (Lochiel) agreed with Mr Fowler’s last proposal, only he held that the South Island Dairy Association should be the committee to enquire into the question of buying. Eventually a motion calculated to embody the wishes of the meeting was drawn out, moved by Mr Buckingham and seconded by Mr Leighton. A division was taken on the point as to whether the surcharge had better be 14/- a ton on one year’s output or 7/- a ton on two years'. The meeting was strongly in favour of the two years and, with the sanction of the mover and seconder, this was inserted in the motion, which was then unanimously carried in this form;—“ That this meeting of daily factory representatives hereby authorises the executive of the South Island Dairy Association to accept the Bluff Harbour Board’s offer to erect a further cool store at the Bluff to accommodate 23,000 crates of cheese on condition that the dairy factories pay a surcharge of 7/per ton on all cheese passing through the stores for the next two years; and recommends that the South Island Dairy Association go into the matter of the purchase outright of the present building and the new one.”