DAIRY COMPANIES’ SCOPE

Taranaki Daily News, 23 March 1932, Page 7

DAIRY COMPANIES’ SCOPE

POSSIBILITIES OF EXTENSION. AMALGAMATION NEEDED FIRST. The possible extension of the activities of Taranaki co-operative dairy companies was dealt with by Mr. G. A. Duncan in an address at Normanby on Monday. Before assistance with finance and fertilisers could bo given suppliers there would have to be some form of amalgamation between the comparatively small units of the province, he suggested. “l am aware,” said Mr. Duncan, “that some companies are working in with the Rural Credits Associations. They are only touching the fringe of this question and are creating the problem. Are we going further?” The industry would have to consider whether companies should stick solely to the manufacture of butter and cheese or extend their activities to embrace financing suppliers, assisting them with fertiliser's and coal-mining. In the Waikato the New Zealand. Co-operative Dairy Company had done a good deal, but up till now most Taranaki companies had been shy of these outside activities. That there was a demand by farmers for this extension was shown by the legislative authority given companies to work in with Rural Credits Associations.

There were two sides to the question. On the one hand there was the farmer who was asking for assistance, which would perhaps just enable him to scrape through. On the other there was the farmer who could look after himself, and he might question assistance to the first farmer at the expense of the company as a whole. How it would end Mr. Duncan did not know. He could not see that there could be any extension while there were small units such as existed in Taranaki. It was . quite different in the Waikato, where the huge company could do things that were not possible for smaller concerns. There were two ways in which these activities could be arranged in Taranaki. The first and preferable course was an amalgamation such as had taken place in the Waikato, which would give added strength and resources. The alternative was an inter-company arrangement with another company. Many South Taranaki farmers would not consider the first suggestion,, but they could not extend their activities with the present organisation. The smaller companies had actually no working capital, their liquid assets meeting their current liabilities.