CHEESE FALLS SHARPLY

Southland Times, Issue 23782, 1 April 1939, Page 18

CHEESE FALLS SHARPLY

Review Of Export Markets GENERAL TONE IS FIRMER Lamb Schedule Rate Over-Cautious ? (SPECIALLY WRITTEN FOR THE SOUTHLAND TIMES) ' By S.A.H. Trade goes on amid war’s alarums. For that we must be very thankful and thankful too that prices have been really quite fair. Butter and pork meats are selling well; lamb and chilled beef and frozen beef, too, are making fair, prices. Wool is definitely selling poorly, as is ewe mutton. Wether' mutton is a little better.

Most surprising of all, cheese, sb long our steadiest and about best-priced commodity, has taken a severe tumble. But this is viewed as temporary, as to extreme lowness. Quite as influential as expected price fluctuations upon the national income are certain declines seen in production. For the season up to the end of February the butter output was down 13 per cent., and cheese 3 per cent. Adjusted to a butterfat basis, this represents a 10 per cent, decline in dairy output Pig meats likewise are lowered by 13. b per cent. ■ , , ~ Fortunately meat and wool are holding up, despite a season somewhat unfavourable generally. . The price outlook overall is reasonably good. Given assurance of peace, prospects would change 1 to splendid. How good trade then would be! dairy produce For almost two years cheese has enjoyed the most liable market of any of our primary products, except perhaps chilled beef. And not only a stable price, but one highly satisfactory in comparison with the general level of our export prices. Cheese has held closely to 70/- per cwt., going seldom more than 2/- either above or below that figure. A few short weeks ago it eased slightly, but there was nothing to indicate that its value would so slide away. But in just six weeks it has declined from 67/- to 60/-, a drop oflo per cent., equivalent to butter falling to 106/-. For the month of February an average price was seen of 66/3, only 1/3 below a year earlier. Now at 60/-, cheese is at the lowest level seen since 59/6 ruled for April 1937. Then a rapid recovery was made to average 71/3 tor May. The same may be again, seen. Supplies and stocks position hold no real drawbacks to this commodity. At current price, cheese would pay out only 13.70 d per lb. butterfat delivered to an efficient factory. Butter, on the other hand, would pay 15.10 d per lb.

Butter at 118/- is down 3/- on a month ago, but at the same price as- a year earlier. Last month s average price of 121/- was 4/6 above a year earlier and was exceptionally favourable for February; this has so often been a lowpoint period. The prospect is for a stable butter price for the coming few weeks before the May rise. Possibly, however, a further slight decline may be seen before that eventuates. Cheese may be expected to rise soon, although it may not regain its 70/- for some months. PIG-MEATS EXPORT Despite an excellent price level of payment to fatteners, a great deal of propaganda in favour of pig production expansion and valuable gains in knowledge of pig keeping; the Dominions production declines. To some extent only is this due to lower dairy output It is estimated that milk supplies have fallen 10 per cent., while pig-mea'.s are lower by 14 per cent. That means their decline is 40 per cent, greater than the lessened milk supply accounts for. Averaged over pork and bacon, pigmeats have returned 6Jd per lb to producers this season. No other meat is so cheaply produced to make so good a price. Works are now paying 6d for both pork and bacon carcasses, pork coming down £d on a month ago and bacon holding steady. The Home market is steady at a good level. THE MEAT MARKET Meat exporters are operating very cautiously and admittedly so with considerable justification. Theirs has been a worrying business these 18 months past.

But in reducing the lamb schedule to 6Jd per lb it would appear that caution had been overdor.e. On Smithfield, there is seen no reason why should not be paid for first grade lamb to 361 b.

With under 6,000,000 lambs drafted to March 1, it may be estimated that close upon 3,000,000 are yet to go to the works. The lamb schedule is, therefore, of very great importance. As for wethers and ewes, about 40 per cent, of the season’s output is yet to be drafted, representing 1,000,000 export sheep. Of fat cattle, chillers and freezers, 60 per cent, are yet to be drafted.

Killings to the end of February show a great increase in lambs, nearly 735,000 head; and in wethers 204,000. But ewes were down 46,000, probably held out to that extent by killing pressure at the works. Chiller draftings were approximately as for last season, but freezer cattle had been taken- to 90 per cent, greater extent. The Home market appears to be now firming, although in some lines values at mid-March were a little below a month earlier.

Lamb was down ad per lb and chilled beef by 5-Bd. Wether mutton, however was up 3-Bd, a most welcome sign. Ewe’ mutton has held steady for five weeks past. A rise on all prices may be now looked for, though not anything of a sensational nature is expected. A generally firm tone prevails. LONDON WOOL SALES If one-half of a wool clip is sold in London at 9|d per lb, the other needs to be sold in New Zealand at 10id per lb to give an eQual net return at the shearing shed. In view of this, it is apparent that London selling has come out on top this season. Also last season the same was seen.

Over long years the results have been about even, whether wool was sold at Home or here, but the pendulum at present has swung in Londons favour. During the recent past there has appeared a firmer tone in wool selling, but little appreciable price improvement has been yet seen. Wool may lilt a little towards the season s close, and those with wool in London for the July and September series may do very well indeed.