THE GUARANTEED PRICE

Southland Times, Issue 22999, 19 September 1936, Page 14

THE GUARANTEED PRICE

Tooley Street View AGREEMENT WITH SYSTEM “Tooley Street is quite happy,” said a Tooley Street merchant in London when discussing the New Zealand Government’s introduction of the guaranteed price system. “It is 100 per cent in agreement with the new system. New Zealand need have no worry on that score. Everybody will work in quite happily, and there will be no opposition.” Briefly, this is what the change-over has involved: The New Zealand Dairy Produce Board at St. Olaf House, Tooley Street, ceases to exist under that name. It has become the Dairy Sales Division of the Primary Products Marketing Department of the Dominion of New Zealand. Its business is to allocate cheese and butter to importers who have taken a certain quantity of New Zealand produce during the past few years. These it supplies with certain fixed quantities at stipulated times, and an importer promised, say, 10,000 tons of butter or cheese on a given date, is reasonably assured that such quantity will be delivered. “Definite Improvement.” This, say the importers, is a definite improvement on the practice in the past, when such agreements have been subjected to interference by c.i.f. selling. That “era” has ended, for the new regulations prohibit the importers buying in New Zealand on an f.o.b. basis. As to the reduction of the commission, the importers or agents are still worrying for the simple reason that their expenditure will be reduced in New Zealand. They will have no connections to maintain there. • Everything will be negotiated with the Dairy Sales Division in London.

Those agents who may feel aggrieved are those who have not been taking a certain minimum fixed as a line of demarcation. Those above the “line” were “re-engaged.” Those below were not.

English Farmers’ Error. An incorrect impression of the new arrangements found its way round England this week and into the English newspapers. It was quickly quashed by the High Commissioner, Sir James Parr. The National Farmers’ Union evidently thought the guaranteed prices for New Zealand butter and cheese were to be paid by the British Government. It therefore issued a statement. This emphasized the need for a full safeguard for British farmers against the dumping of surplus New Zealand products. It stated that the guaranteed prices given by the British Government were higher than those at present ruling on the London market, and notably higher than the yearly average of the past few years. “It is clear,” the union stated, “that this outcome of the New Zealand Primary Products Marketing Act will need the closest consideration in this country in relation to the Government’s long-term milk policy, which farmers are still anxiously awaiting.” Almost immediately the English farmers were informed by Sir James Parr that the guaranteed prices were to be paid by the New Zealand Government, and that they were actually considerably lower ti»n the present London market prices.