Co operative Dairying

Te Aroha News, Volume XXXIII, Issue 15710, 17 December 1915, Page 2

Co operative Dairying

' AMALGAMATION PROPOSALS (Contributed) Those connected with the dairy business have for some time past deplored the'' enormous loss to the producer which has resulted from the overlapping of dairy companies. There is. a butter factory in the Te Aroha district, but cream is being sent from there to Paeroa, Ngaruawahia, and Frankton Junction, instead of being made into butter at the local factory, while in the Waiuku district, where there is a butter factory, some cream is carried by boat to Onehunga and railed to Mercer to be made in to butter, thus involving enormous cost, as well as deterioration of quality.

In other centres rival companies are running as many as three cream carts through the same district, while the work could be done by one cart at less than half the cost. In other places two butter factories will be found side by side, or a creamery, a cheese factory, and a home separation cart are competing for the business with varying success according to the respective prospects for the time being of butter and cheese. These and similar follies have resulted in a loss to the producer of the Waikato of from £30,000 to £ 50,000 per annum, and even more impor tant still as far as the future is concerned in a deterioration of the product. While the war continues markets are good and the demand is strong, but there is every probability that after the war prices will be poorer and markets weaker, so the producers are taking action to ensure economy by cutting out overlapping, and higher quality by turning products to the best possible account. 1 These considerations have for some time past engaged the serious attention ot some of the large co-operative dairy companies of the Waikato, and have resulted in a scheme being form ulated for a general amalgamation. It is understood that all companies operating in the South Auckland district will be invited to participate in the advantages of the proposition. Meetings will shortly be held to further promote the scheme. The proposals provide for : (1) a purely co-operative company, and to ensure its co-operative entity being maintained it is proposed to distribute all profits on a butterfat basis, provision being made to relieve ,r dry shareholders ’’ of their shares under suitable terms and conditions.

(2) the taking over by the new company of the assets of the several companies which join. (3) the issue by such new company of shares in lieu of those now held in present companies, subject to adjustments to meet varying conditions. (4) the division of the territory occupied by the proposed company into 1 electorates,” the shareholders in sech electorates to appoint one of their number to the Directors’ Board, thus ensuring reoresentation from all districts.

(5) the manufacture of either butter or cheese, and if but"er by creamery or by home separation system, according to the wish of suppliers. The advantages from a union such as is contemplated are briefly set forth as including the manufacture of better quality butter and cheese ; the great reduction of expenses by cutting out of overlapping of organisations, and the delivery of butterfat at its natural centre ; the cutting out of friction and consequent waste ; a stronger and more economical or* ganisation on the local market, with consequent advantage and possibly in time a stronger position on the London market, It is estimated that the advantages in a few years would more than total the capital of the combined organisation If the scheme is generally adopted the turn over of the new company will probably exceed two millions per annum, most of which will represent business done in England. With such large interests in Britain it is expected that the Direct ors of the proposed company will give consideration to sending a representative to London as a means of securing better returns from there, and to attend to the purchase of articles of general utility for the company’s suppliers, thus offering increased advantage in this respect also.

When the propositions have been approved by the Directors of the several companies they will, of course, be submitted to the shareholders for adoption.