BURRENT TOPICS.

Taranaki Daily News, Volume LIV, Issue 27, 26 July 1911, Page 4

BURRENT TOPICS.

DISPOSAL OF DAIRY OUTPUTS. Mr. R. Ellison, London representative of the National Dairy Association of New Zealand, is at present in Taranaki endeavoring to persuade those factories without the pale to join the Association and participate in the alleged benefits arising from the disposal of their outputs through the one medium, or, rather, through four firms selected by the Association. We have had occasion in the j past to utter warnings regarding the' harmful results attending the well meant proposals of the Association in other directions, and we would have' thought it quite unnecessary, after the absolute failure of the Association's "cornering" scheme of last year, to warn companies against having anything to do with it again this year. In theory, the Association's scheme looks admirable and attractive, but in practice it has proved a very costly failure so far as the producers are concerned. The Association shipped through four firms, and then other merchants in the Old Country, being out in the cold and not getting supplies of New Zealand butter, turned to the cheaper-priced Austratralian, -of which there was an uncommonly large supply, and with it supplied their customers. The Australian article was, naturally enough, pushed for all it was worth, particularly as the retailers stood to make y 2 d extra profit as against New Zealand butter, which consequently was neglected. The customer could probably detect little difference in the butter, which he probably took to be that with which he had been before supplied. Sales of the latter suffered, and stocks accumulated, and, as a consequence, prices remained at a low level. For the four preceding years the difference in price between New Zealand and Danish butter had averaged 7s per cwt. To quote the Dairyman: The promoters of the " combine" said this difference was iniquitous, and solely due to want of combination. When the combine started there was practically no New Zealand butter on the market. The nominal difference was only 3s per hundredweight, and even this was to be reduced. Before, however, the "trust" had been going many weeks the difference was up to 7s. This gap was soon doubled, and the difference was ,14s —nearly half as much as it had been before. But even this was not all. As supplies from New Zealand went on increasing, so did the width of the gap, until it reached 18s, or just on 2d a pound. The guarantee that the difference in price between Danish and New Zealand during the season October to March, ]!)10-U, should be loss than in the same period of 1909-10, had become a laughing stock long before the gap widened to its greatest limits; and when the guarantee reached its limit of ISs, any hopes of the guarantee being made good vanished into thin air. It was the old story of the dog and the bone. In grasping at the shadow these, unfortunate factories had missed the substance. Instead of saving one-half per cent, on the commission rates, their losses have b<v>n exactly eighteen times the half per cent. Certainly no greater fiasco in commercial circles was ever accomplished.

Yet the Association seeks to continue the system, and is doing its best to persuade more factories to join the combination! Had the old conditions prevailed and dairy factories "paddled their own canoe" last year and accepted the prices offered—as much as 11% d f.o.b.— they would have, been, in the aggregate, thousands of pounds in pocket, and the suppliers, whose interests we are mostly concerned about, would have received about %d per lb. more than they did. "Competition is the life of trade," and the principle obtains just as much in connection with the disposal of butter as in anything else. With from twenty to thirty buyers in the field, each endeavoring to secure the output of a factory, it stands to reason that the best terms possible will be obtained. To narrow the sale of the produce down to a few firms is suicidal. The other firms operating in the Dominion have their connections in the Old Country, and it stands to reason that they are' going to conserve those connections in every way they can. If they are blocked from getting supplies of New Zealand butter their customers are not going to run short. Oh, no. They will turn as they turned last "year to the butter of other

countries, customers will* become accustomed to the new article, retailers will give it preference and push it for all it is worth because of the extra profil attached to its selling, and the industry ! in New Zealand will seriously suffer, as it seriously suffered last year. The Association is making the cardinal mistake of thinking it can be producer and marketer at the same time. It can never hope to. It should be satisfied to confine its attention to the end of the business it understands—and there is plenty of scope, goodness knows—and leave the marketing to others whose lives have been devoted to it. The policy of greed has never paid, and never will. '

A BLOW TO TARANAKI. There is another aspect of this matter that is deserving of the very closest consideration of everyone associated with the dairy industry. In a paper prepared by Mr. R. Ellison, the London representative of the Dairy Association, who, as we previously said, is now in Taranaki submitting the scheme to the various dairy companies, he makes this statement:— If the price of butter receded to a figure that would allow of a more ready consumption, all the exporting countries would use much more; the artisan class and the poor would be able to get more for the same amount of money; the demand for butter would become so stimulated that any danger of exceptionally low prices would be averted. If it were possible to have a good shilling butter all the year round the increased amount required in this "wintry (England) would be astonishing.

Here we have the spectacle of a man representing the interests of a big section of New Zealand producers actually advocating in England, where our produce is sold, a decrease in price! A shilling butter in England—what doe* it represent to the New Zealand producer? Less than lOd a pound, a sum considerably below what has been obtained in former seasons without the assistance of the combinations attempted by the National Dairy Association, and certainly very much less than Home buyers have freely offered companies in New Zealand. Last year as much as ; ll'/id was offered to many Taranaki companies. Yet the Dairy Association's I representative is advocating a rate l%d j to iy 2 d less. Is this the way the Association is striving to imjftove the con-1 ditions of the producer? We wonder what the producers will have to say about this kind of "Paddy" improvement! Some there are who will say; that it would be a good thing for Tara- i naki if the price of butter did recede, as it would have the effect of lowering land values, or prices. Probablv that would be the effect, but the result would be disastrous to this province. At the prices paid for land in Taranaki during the past few years, a drop of from iy 2 d to 2d would mean nothing short of bankruptcy to scores of farmers, and if such a thing happened business throughout the province would suffer correspondingly. It is not a decrease in the price of butter that is wanted, but an increase, if it can be obtained. Mr. Ellison, if he is truly, solicitous about the welfare of the producers of this country, should not advocate lowering the price. If he can do nothing in the other direction, he should be silent. Another point. The Association, through Mr. Ellison, has endeavored to assure the Home merchants that there is no such thing as a "combination" at work in this country. Tn the "British Oocer" of February ' Mr. Ellison observes: "As regards New Zealand butter and cheese, there is nothing in the shape of a monopoly whatever existing at the present time; in fact, quite the reverse is the case." Yet we have Mr. Ellison and the Dairy Association doing their utmost at the present time to bring j all the factories they can into the combination, whose sole object is the monopolising and handling of the whole of the outputs of the Dominion. The English people know just as much as we in this country do about the operations of the National Dairy Association. If the latter, by their combination in the matter of dealing with the outputs of the factories, could improve, the position of producers, then we should say, all power and pood luck to them, but' when the reverse is the case, as lias been proved by last year's dismal failure, dairy companies will be well advised to think the matter over very carefully indeed before lending their support again to a scheme that lias operated in the past so ininiically to their interests.