DAIRY PRODUCE

Southland Times, Issue 21092, 26 May 1930, Page 7

DAIRY PRODUCE

MARKETING METHODS IMPROVEMENT NEEDED OPINIONS OF OVERSEAS VISITOR As a result of the prolonged depression in connection with the price of . dairy produce on the Izmdon market, the distribution and marketing of New Zealand butter and cheese is promising to become once more a vexed question among dairy company directors and suppliers. The problem has been given particular attention during the last few months and reasons of a more or less contradictory nature have been advanced as to the serious decline in values of these commodities. While some contend that the abnormal drop in prices is due to purely economic causes, others maintain that it could have been prevented by better and more efficient marketing methods. In this connection the views of Mr A. S. Western, a recent arrival in the Dominion, and the representative of a large produce firm- in the North of England are of particular interest. Mr Western has a wide knowledge of dairying conditions in Siberia and the Baltic Provinces, and just before coming to New Zealand he visited dairying districts in Victoria, New South Wales and Queensland. As to the reasons for the almost unprecedented decline in butter and cheese values, Mr Western said that in his opinion they were purely and entirely economic. “The production of butter to-day,” he stated, “is greater than the consumptive demand. Not that there is such a thing as over-produc-tion in a strict sense. Every pound of- butter produced will be sold and bought at a price." But this price will be determined by the consumer and whether it is a profitable price for the producer" is a different question. When there is a shortage the producer is in a position to dictate prices; when a surplus this becomes the consumers’ privilege. Could Decline have been Prevented? It was stated by Mr Western that the opinion was often expressed in New Zealand dairying circles that this Dominion fared particularly badly in the present depression and that the decline could have been prevented to a great extent by better marketing arrangements at the other end. “That is an entirely erroneous conception of present day conditions,” replied Mr Western. “I have heard quite a lot of this kind of talk since I arrived in' New Zealand. I noticed a statement to the effect that had more attention been given to the marketing end of the business, "producers would not have had to accept as low a price as 120/- per cwt for butter. To my mind this is .not the position,” continued Mr Western. “When New Zealand butter was selling at 122/-, Australian was at 118/-, Argentine at 115/-, and Danish at 132/-. We, in the North, have the highest regard for the Danish selling organization and yet they were absolutely powerless to hold prices and had to accept ruling rates.” “As to New Zealand producers faring worse than those of other countries, this is entirely contrary to facts. The figures I have quoted bear this out. There is, moreover, a tremendous over-production of butter in America, due," no doubt, to the encouragement given the industry by the high tariffs in that country. Prices in the U.S A. have not been so low for ten or more years. Heavy production was also experienced by every butter-producing country in Europe. But worst off, of all, is the English farmer, who has to compete against all-comers, and if any man has just reason to complain it is the British producer.” Asked as to the prospects of an early improvement, Mr Western was not inclined to express a definite opinion. “The present is no doubt a cyclical depression which has to run its course and work itself out,” he replied. “Every product of the soil has to suffer and the dairy farmer is by no means as badly off as, for instance, the sheep farmer or agriculturist. This should be an answer to those who see a remedy in a change of marketing methods.” Mr Western mentioned the Canadian wheat pool, which bad every indication of becoming the greatest disaster in the history of the Canadian primary industry. “Nothing has ever equalled this huge gamble,” he declared, “and your butter and cheese pools were not in it. Nor has ever anything so clearly and decisively demonstrated the risks and dangers of pools and the folly of trying to dictate prices above an economically sound level.” Mr Western thinks that the interests of the New Zealand dairy companies, are being well looked after by the present system of marketing and expressed the opinion that producers should think twice before attempting anything in the nature of a pool or over-centralization. Cultivate Goodwill. Goodwill towards the wholesale and retail trade, as well as the consumer was, in Mr Western’s opinion, another matter of great importance. “You have a wonderful country and a wonderful industry, and have every reason to be proud of both,” concluded Mr Western. “At the same time do not be led to believe that you are the only progressive country, for Siberia is making great strides and the Baltic provinces are producing some very fine butter. “It is a question of quality every time, and my advice to New Zealand dairy farmers is to cultivate the goodwill of the Home trade and the Home consumer rather than to talk of pools and selling combinations which will always be looked upon with disfavour and suspicion.”