THE DAIRYING INDUSTRY

Taranaki Daily News, 19 June 1931, Page 12

THE DAIRYING INDUSTRY

ANNUAL MEETING AT URUTI PAY-OUT OVER ONE SHILLING. REVIEW OF DIFFICULT SEASON. An increased output of nearly 16 tons, an overrun of 24.12 per cent., and~ a pay-out of 12jd per pound butter-fat over the whole season were the principal features disclosed in the seventeenth annual report which was presented to suppliers of the Uruti Valley Co-operative Dairy Company at the annual meeting of suppliers yesterday. Mr. W. Lawrence, chairman of directors, presided over an attendance of over 30.. r The report announced a further increase in the output of 15| tons. The year just closed had been a difficult one; prices had been lower than foi many years. The cream received for- the year totalled. 794,7211 b., butter-fat 350,9131 b., making 435,5581 b. of butter, an overrun of 24.12 per. cent. The average test was 44.14 per cent., and. average o-rade of butter 94.243. The proportion of finest grade cream was 95| per cent., first grade 3J per cent., and second .grade t per cent. The profit and loss account showed a credit of £4lOO 3s 3d, which would enable a further payment of 2|d per lb. of butter-fat supplied for the year, bringing the average payment over all oracles to 12id. As the last two months butter w T as sold f.0.b., that would be the final payment. The cost to f.o.b. ocean steamer was I.Bld per lb. of but-ter-fat, or 1.45 d per lb. of butter; depreciation cost .lid and levy .03d per lb. of butter-fat. The quantities and averages for the year, with those of the previous year in parentheses for comparison were as follows: Number of suppliers 39 (36); cream received 794,7211 b. (715,0011 b. butter-fat, 350,9131 b. (321,3601 b. butter made, 435,5581 b. (400,1891 b. over-run, 24.12 per cent. (24.52 per cent.); average test, 44.14 per cent. (44.94 per cent.); average grade, 94.243 (93.586); pay-out, 12.25-d (15.56 d The balance-sheet showed that receipts had totalled £20,974 12s 6d. The sum of £13,902 9s 5d had been paid to suppliers, leaving a balance of £4lOO 3s 3d, which gave an additional 2£d per pound butter-fat over the whole season. INCREASE IN OUTPUT. In moving the adoption of the report the chairman said that it was pleasing to record a substantial increase of 15S tons in the output over the previous season, especially as that season s output (194 J tons) was a record in the history of the company. Had climatic conditions in the earlier part of the season been more favourable the increase would undoubtedly have been still larger. The additional one or two suppliers accounted for a portion of the increase but it went to show that shareholders were concentrating on increased production, which was the only way to make up for the lower prices. Mr. Lawrence stressed the point that to compete with the ever-increasing competition it uras vital that shareholders should concentrate not only on more production but also on the highest quality. At the end of the previous financial year there remained unsold 1900 boxes, of butter which had been taken into account at lid; 772 boxes were sold, f.o.b. at Is lid, proving a very good sale, as if the butter had been shipped on open consignment it would not have realised, within a penny of that price. When the remainder was realised, there was a further £4lO available, enabling a bonus of 5-16 d per pound over the whole season to be paid, bringing the final payment to 15Jd which, he thought, could be considered very satisfactory. Although prices had been lower than for many years, the past season had proved to be better than had been.anticipated in the early part of the. season. Prices gradually fell from 120 s in June to 98s °in December, when the market took a turn and l a healthy rise set in, prices steadily going up until about the middle of February 124 s was reached. During that rise f.o.b. offers began to come forward and in December the directors were offered 11 l-8d f.o.b. for the December-January-February make, a price equal to 112 s to 114 s on the London market. As the price was still on the rise the offer was not accepted. In February another offer came forward for butter in store, also the February make, at Is OJd and Is for butter afloat, as well as Is Old for March. The. market was found to bo very active, rising from 114 s to 12(te in a few days and still very firm. Taking into consideration the stock position and the good consumptive demand in Britain, prospects for butter at that time were particularly bright and there was every indication of prices stabilising at somethin* over 120 s per cwt. Moreover, the price offered was only equal to the price in Britain, so the directors, being keen to get all that was in it during these times of low prices, turned, the offer down. Prices continued to rise up to 1245. Unfortunately that level was not maintained and. within a few days the ■ market was on the downward trend. Had. the offer been accepted it would have proved to have been a very good sale. DIFFICULT SEASON. Dairy company directors, Mr. Lawrence said, had had to face a very difficult season. The market continued to drop till in April it was back to 106 s to 108 s. At that time the directors received an offer of Is f.o.b. for March-April-May-June make, a price equal to about 116 s on the British market, that being the first time in the season that an offer had been made in advance of the London price. The directors considered that by accepting the offer they would be able to wind up what looked like being a very disappointing season in the early part as a satisfactory one, and that sale was largely responsible for bringing the pay-out to w’hat it was.

Mr. Lawrence thanked the directors, manager, secretary and staff for the loyal support that had been, given durino- a very difficult season. Replying to Mr. H. E. Fugle, the chairman stated that the manager's salary was now £370 a. year. That was above the scale rate, but the directors recognised after a year or two that they had secured an exceptionally good man. He had saved them £7O in fuel in one year and £3O or £4O the following year, besides getting good results,°so the directors considered he was entitled to a rise. The secretary was receiving the same as he had been receiving for 15 years. In answer to a further question by Mr. Fugle, the chairman stated that the manager did not come under any award and so would not be affected by the 10 per cent. cut. The assistant was under the award and would be eligible for the cut. In view of the hard times the directors had liad under consideration the question of a cut and in all probability would have made one early in th' season but for the fact that when they were faced with an expenditure of about £5OO for the installation of a larger churn to cope with the increased output the manager .(Mr. W.

Jones) had offered in view of the hard times to manage with the present churns for the season. Tliat entailed having to churn twice with one of the churns, thereby necessitating three churnings instead of two during the flush of the season and entailing additional work for the manager and staff. : INCREASING SHARE CAPITAL. On the motion of the chairman .and Mr. A. E. Sa'ywell a motion of which notice had been , given was passed increasing the share capital from £3OOO to £4OOO by the addition of 500 shares at £2 each. The chairman pointed out that only 10 of the original 1500 shares were now available for allotment. For the vacancy on the directorate caused by the retirement of Mr. W. M. Sutton, there were two nominations, the election resulting in W. M. Sutton and E. A. Jones each receiving 34 votes. After some discussion the meeting decided that lots should be drawn and Mr. Jones was declared elected. Mr. A. J. Tunbridge was re-elected auditor at the same fee as last year. . The directors were voted the same honoraria as last year—los each per meeting. Some discussion took place over the question of the chairman’s honorarium. Mr. Fugle said that as he had done the previous year he would move that it be reduced "to £25. He pointed out that it had been a very hard year. The Government had introduced the 10 per cent, cut and the company must see that its expenses were reduced considerably wherever possible. He would like to see the matter thoroughly thrashed out and considered that it should go to the vote. The chairman: It will certainly go to the vote. Mr. Fugle: I mean ballot. ' The chairman said it was unusual to put such a matter to the ballot. Mr. Alpe moved as an amendment that the honorarium be reduced to £4O, which meant a 20 per cent. cut. He considered that a 50 per cent, cut was too drastic, particularly as in view of the depression the chairman would need to keep a much closer supervision. It was pointed out that in 1929 the honorarium had been raised from £25 to £5O. Mr. Fugle pointed out that previously it had been £l2. He thought that as the work was being done among themselves it should be carried out reasonably.; , The chairman, in view of the lean season and the fact that prices were down so much, asked Mr. Alpe to withdraw his amendment.. Mr. Fugle: Hear! Hear! Spoken like a man.

Mr. Alpe, however, refused to withdraw his amendment. Sir. W. Murray: Let there be a ballot to satisfy Mr. Fugle. The ballot was accordingly taken, the result being that the £4O honorarium was carried by 40 votes to 28. At a subsequent meeting Mr. W. Lawrence was re-elected chairman.