A WORLD MENACE

Taranaki Daily News, 19 June 1931, Page 9

A WORLD MENACE

SOVIET MARKETING PLANS. CHEAP PRICE OF ITS BUTTER. The fact that Soviet Russia landed 15,000 casks of butter at London docks during the week-end, states the Glasgow Herald of May 12, has set traders speculating whether we are to see the same experience repeated in this commodity as has already occurred with wheat and timber. Mainly because of the deluge of cheap Soviet wheat exported from last year’s crop in the last three or four months o'f the year, Canada’s earnings from wheat sent to our markets for 1930 yielded a return of only £ll,378,539 or just about half the sum which the Dominion earned on its wheat shipments to Great Britain in 1928.

If Russia is now bent upon securing credits in return for heavy shipments of butter supplies, it is recognised that New Zealand and Australian producers stand to suffer as Canada has already done. Of our total payments for butter imports last year of £46,907,496, Denmark easily led with £17,102,544; New Zealand was second with £10,816,279; Australia third with £6,022,152; the Irish Free State fourth with £3,274,224; and the Soviet was only eighth with £1,005,260. But in the two preceding years, 1929 and 1928, the Soviet sent butter to us worth £2,299,050 and £2,656,372 respectively. In discussing the prospects of the Russia supply, Sir Thomas Clement, wjio was Butter Controller under the Ministry of Food during the war, declared that the quantity of butter that may be shipped from Russia is still a secret. The Arcos officials in London will divulge nothing. Accordingly all statements as to the scale on which Russia will land butter in our markets are mere •guesswork. It is stated that Soviet agents refuse to disclose the supplies that are available for export. The butter is offered at fully Id a lb below New Zealand’s I price. Apart altogether from the scale on which Russia exports butter, Sir Thomas Clement regards her marketing methods as nothing short of a menace to civilisation. The price at which this latest/shipment is offered in London is understood to be 98s a cwt, which is about 10s a cwt below the import price of New Zealand butter, and represents a still greater margin of cheapness against Danish butter—about 20s a cwt less. Consider that an import price of 108 s a cwt for New Zealand butter represents only 9d a lb to the New Zealand farmers, who have to ship their produce 14,000 miles to our market, and that it requires 2J gallons of milk to make every lib of butter, and readers will be able" to appreciate how depressed must be the state of dairy farming in that part of the Empire. The figures quoted mean that the return upon the milk must be only between 3d and 4d a gallon, which is probably only half of its cost price. Moreover, New Zealand cheese is equally depressed in price. Looking to these facts. Sir Thomas Clement regards the Soviet marketing plans as a world menace, because their pricing has not any basis on ordinary costing principles. They are merely out to capture the markets by cutting prices, and if other sources tried to meet their competition the Soviet price would again be shaded down.