The Daily News. SATURDAY, SEPTEMBER 4, 1926. DAIRY COMPETITION.

Taranaki Daily News, 4 September 1926, Page 12

The Daily News. SATURDAY, SEPTEMBER 4, 1926. DAIRY COMPETITION.

That the inauguration of the operation of the Dairy Control Board set up by New Zealand should be made the subject which takes pride of place in the recent report of the Imperial Economic Committee on the preparation and marketing of Empire produce is only what might be expected. The tenor of the report indicates that the committee is somewhat in the dark as to the real aim and object of the board, and has, therefore, deemed it necessary to issue a warning to Empire producers not to attempt to control prices on the English market, but, in seeking better returns for their produce, to turn their attention to effecting economies in order to meet the inevitably severe competition on that market. There is really no fresh argument on this subject advanced by the Imperial Committee, all the points put forward being well known to Empire producers, though some of them are presented in a new guise. In the annual consumption of butter per head in Britain during the last twenty years the increase has only amounted to one pound, While, though the demand for both butter and cheese if? expanding, there *fce indications that foreign countries are making considerable efforts to recover and improve their pre-war trade positions, a fact that is well, known to Empire producers. It is probable that the reason why this severe competition is so prominently stressed is to lend force to the warning as to the futility of attempting to control the prices of dairy produce on the Home market. The committee considers that the only way in which the producers can maintain the present standards of living among those dependent on the dairy industry is to prepare, without delay, to meet the cutting of prices, caused through increased competition, by adopting more efficient and cheaper methods of production, such as increased output without any addition to the cost, obtaining a greater quantity of milk and butter-fat from each cow, pasturing more cows to the acre, improving the herds, pasture and fodder* crops “without equivalent additional cost.” The dairy farmers of the Dominion are quite aware of the nature of the economle policy they jmisu.

pursue, and it .may be taken for granted that those who have, or can raise, the necessary capital, will pursue that policy, not only for enlarging their output, but for improving its quality. The suggestion.that Denmark’s example of- winter dairying should be followed, where practicable, in order to ensure regularity of supplies to the British market, is hardly likely to meet with favour on the part of New Zealand producers, except as a last resort. The alternative of holding sufficient dairy produce in store in the Dominion to ensure the continuity of supply throughout the year is far more practicable, though whether in the long run this would pay producers is open to doubt, as insurance, storage, and interest charges involved in the policy might prove greater than the better prices obtained. It will be noticed that the committee emphasises that a fall in retail prices instantly increases consumption, and follows up that statement by asserting that the remedy - for speculation arising from price fluctuations is the regulation of supplies and the stimulation of demand. The only conclusion to be drawn from these two contentions is that in regularising the wholesale prices the level should be such as to stimulate demand, but such a course does not allow for the element of quality, while it would certainly play into the hands of the retailers in forcing the sale of lower quality goods. The main point of the committee’s attitude is evidently the fear that “such control bodies” may be tempted to abuse their powers. These fears are .shared by a considerable section of the producers, who should concur in the desire for a policy of moderation and abstention from dangerous experiments. That the Control Board can do good service in accelerating and better regulating shipments, developing marketing, and giving a weekly lead as a guide to market prices is admitted, but it is equally certain that any attempt to fix prices will court disaster.