COMPARATIVE DAIRY COSTS

Taranaki Daily News, 17 December 1930, Page 10

COMPARATIVE DAIRY COSTS

35 PER CENT, INCREASE SINCE WAR

FREEZING AND REQUISITES UP.

i. An interesting analysis of dairy factory costs has been, compiled .by . Mr., A.' Lees, secretary of the Joll Dairy Company, and in • view of recent- agitation for reduction- in .primary., production costs the figures provide, food for thought.: In : demonstrating how. costs per -lb of.ibiitter-fat -up to ■ f.o.b. ocerin steamer have riseir from 2.5493 d in. 1912-. 1.4 to 3.452 d in 1928-30 the-analysis reveals that the principal items .in - which' increases are shown'are crating material and other requisites, freezing an,d sforage, and railage. Wages andsalaries form a very' small' part of. the .total, increase. A ' ’ . ' " ‘ -

Mr. Lees’- review came before the directors of -trie Joll Company, op - Monday, and it : was '■ decided'■ to hand’ it; /on to the Press..’ ' ’.'

For purposes of comparison Mr. Lees has chosen the two years prior to the war . ahd; the. two most . reeqiitiy .completed seasons. ' During both periods cheese was made and also butter in the winter months. The production Has been more than doubled since 1912. . '

The first item-dealt with is requisites and crating material. In the period between July 1, 19.12, and June 30, 1914, the expenditure- was £7865 13s sd, 'dr 4s 9.33 d per 1001 b of butter-fat; from Jiily 1, 1928, to. Ju.nq 30, 1930, £24,626, or 7s 4.69 d per 1001 b of butter-fat. This' : shdws an increase of 54 per. cent.per' 1001 b of butter-fat. - . . 7:'. : , A reduction in costs is shown, however, under the heading fuel and power. ■ this being due tp imp'rdveinbnt?’ ’ in machinery and htethods. The charges .per 1001 b have declined “from -2s “2;()Id B n the first period to 2s o.Sid in the-second two years, a' decrease of'.4 per cent. '; . ' Although in each "case . wages - and salaries account for the biggest expenditure ( £1'1,889 in 1912-14 and '£25,707" in

Other items as stated above are:-Fuel and power;'cartage; sundry .* charges.

1928-30), the proportion of the 35 pet cent; increase in f.o.b. costs under this head is only 6:51 per cent, as compared with 32.15 for crates, etc., and 27.41 for freezing and cold storage.- It shows, in; fact, the lowest percentage’ increase in proportion to the total increase of any of the items, other .than those' in which reductions have been made., ' Under the heading of repairs, renewals and depreciation the costs , have gone from '2s 8.70 d to 3s 8.76 d, an increase of 37 per 'cent, and accounting for about 14 per cent.'of the total increase. .One item of expenditure that has become nearly .trebled is freezing and storage. This' cost Is 0.77 d in 1912-14 and 2s 11.71 d, in 1928-30, 179 per cent, more. From £1753 3s 4d freezing and storage charges' increased to £9918 4s 6d.' _' '' ’ ; J • The' only other increase in expenditure is in new. -charges. : These include Control ' Board levy' ( £ll4B ,14s. lOd), grading fees' (£.1061 16s -id)), . farm instructor. ( £589. Iss), .laboratory subscription (£139 10s sd) and income- tax (£3ll 18s ’ld). These' account for. nearly 13 per - cent; 'of the •: total increase. > 7 \As well as in fuel and power, reductions are shown in cartage (including and allowing for' charges, on. the Opunake railvvay) and general expenses ■ (such as insurance, interestj legal, printing and stationery, rates)-and taxes, stamps, telephone and directors’ fees).": In the first ease expenditure has increased from £2338 4s Sd to only £4293 18s 8d; or in terms of cost -per 1001 b of butter-fat it has decreased • from Is 5.04 d to Is 3.46 d, ; a saving) of 9 per cent. In (he second.;' casp ; thef’tqtal charges have increased: from :£lB?7;7s' 6d to only £3592 0s 6d, a reduction per IQOlb of butterfat of ,39d er- 2 per cent. ' The total charges for two; years have ijnereased from .‘£34,969 4s, 6d to £95,867 ’l4s 3d and'the cost.per 1001 - butter-fat ff opi £ I.'. Is' 2d to £1 8s 9d; a The increase- is. therefore Jo per cent. The pay-biit has. increased from an, average of 12.936 p'er )]b.)to' air average of 19.15 d, an increase of nearly 50, per cent. . A'comparison of headings under whiph there: is an increase.is:—., ) 1 ■■) 7- -;7. ’’')Total

Requisites and crating material ’.. Wages and salaries .. Repairs, Depreciation and Renewal . Freezing and storage ...... Rail from Normanby ..............

F.O.B Costs' ■ 'Increase per cent 19 12-14 1928-30 . ■ ’ Per increase. s d s d s d cent 4 9.33 •7 4.69 ;2 •7.3.6: 54 32.15 7 2.66 7. 8.58 . 5.92 ! 7-... . 6.51 2'8,70' . 3 .8.76 •1' 0:06' 37 .. 13.91 1 0.77 2 11.71 1 10.95 179 27.41 9.03 1 6.58 9.55 105 S.29 /I ■ • . ■ . 1L72. 12.88