INCREASED COST OF FARMING

Southland Times, Issue 23897, 16 August 1939, Page 6

INCREASED COST OF FARMING

GUARANTEED PRICE DEPRECATED DROP IN PRODUCTION OF BUTTER AND CHEESE (From Our Parliamentary Reporter) WELLINGTON, August 15.. Government members appeared to think that if the dairy farmer had an increase of Id a pound for butterfat his increased costs would be met, said Mr W. S. Goosman (Nat., Waikato) in the House of Representatives this evening, but they should consider increased costs. Butter production costs had gone up by 25 per cent, during the last three years. The increased costs of the New Zealand Co-operative Dairy Company for the whole of New Zealand, from the gate to f.0.b., were £388,380 —a rise of £2/4/2 a ton. In 1937-38 there was a drop in production of 5360 tons of butter, but costs had increased by £362,263; in 1938-39 the drop in production from the 1935-36 output was 24,177 tons, and by then the increased cost a ton was £3/5/7. The total increase over the three years was £1,247,992, and the dairy farmers had to bear that increase.

At the same time 98,000 dairy cows had been driven out of production by the policy of the Government. During the three years he had been reviewing, said Mr Goosman, production had declined by G 424 tons and the cost o£ production had increased by £582,187, and when the increased costs of producing butter and cheese were added together it would be found that the dairy farmers had lost about £1,800,000. Other farm costs had to be added to that, and when they were all computed it would be found that the farmers had received nothing from the guaranteed price. Looked at in another way, the cost of producing butter had risen from £l2/13/2 a ton to £l5/7/-, the cost of producing cheese from £lO/2/11 to £l3/10/11 and the cost of producing dried milk from £l6/18/1 to £2O/8/11, said Mr Goosman. The last increase amounted to about 4d a pound butterfat or £62/10/- a year to a farmer producing 20,000 pounds. The increased costs had killed the casein business altogether.