MANGOREI PRODUCTION

Taranaki Daily News, 18 August 1933, Page 11

MANGOREI PRODUCTION

OUTPUT AGAIN INCREASES RECORD OF 870 J TONS BUTTER. — v COST OF MANUFACTURE DOWN. An increase in output, which has now reached the record of 8701 tons of butter, a further reduction in the cost of production to 1.30 d per pound butter-fat, and an average payment of 9.33 d per pound butter-fat were recorded at the 38th annual meeting of the Mangorei Dairy Company yesterday. Mr. G. Marsh presided over an attendance of about 100 suppliers. The report stated that conditions for dairying during the year were exceedingly good, and there was an increase of 110,7391 b. of butter-fat handled by the company. That constituted a record for the company. The quantity of cream received and the figures relating to production were: Number of suppliers, 352; quantity of cream received, 4,072,436 lb.; quantity of butter-fat, 1,579,8601 b.; average test of cream, 38.79 per cent.; lbs. of butter made, 1,949,1901 b.; cost of manufacture at per lb. butter-fat, .78d; management, -22 d; charges to f.0.b., .19d; depreciation, .lid; total cost, 1.30 d. The average gratae' was 94.230 points. The cost of cream collection was .25d per lb. butter-fat.

The results of all butter shipped up to and including the Port Hardy, taking gradings up to January 27, had been taken into account in the balance-sheet; 3922 boxes -were still afloat on consign- ■ ment and the remainder of the output up to June 30 had been sold at lOd per lb. f.o.b. steamer. Sixpence per lb. had been advanced against 2004 boxes, and 7d per lb. against 1918 boxes. Cool store stocks had been valued at the sale price of 10d per lb. With the improvement in the market price the remaining consignments should show a substantial surplus when sold. PAYMENTS TO SUPPLIERS. During the year £54,138 10s 8d had been paid to suppliers, being equal to 8.22 d per lb. butter-fat The sum of £750 had been written off for depreciation, and there remained a balance of £5570 Is 2d to the credit of profit and loss account. The directors had authorised the payment of a dividend of 5 per cent, on share capital paid up to June 30, 1932, amounting to £506 Is, and additional payments of IJd per lb. on butter-fat supplied during February, and 3d per lb. on butter-fat supplied during March and April, bringing the average payment for the twelve months to 9.07 d per lb. butter-fat. Further payments would be made from time to time as the remaining consignments were marketed. Shareholders were to be congratulated on another very large increase in output, remarked the chairman. Last year he had given figures with regard to production and costs of manufacture over the past ten years. The present season had, however, created another record, the total cost of manufacture being 1.30 d, per lb. of butter-fat or onetenth of a penny less than in the previous year, and less than half what it was ten years ago. Although it did not seem possible for the district to exceed an output of about 600 tons, he had always hoped that some day the output would exceed 1000 tons, and it looked as though that would be gratified in the near future. He complimented the manager on his very creditable performance in reducing the costs to the present low level and maintaining a very high standard, of quality. (Applause). The average grade of the butter was 94 230 points as against 94.418 points for the previous year, and although it was a little lower it had no effect on the selling quality. Throughout the season they had had nothing but complimentary reports from the London agents, while in addition they had not received a single adverse report from the London inspecting officer of the Department of Agriculture. EXCHANGE AND OTTAWA. Some of the offers received early in the season for small parcels were higher than the results of consignments being shipped at that time, but in view of the persistent rumours that New Zealand would be granted a free exchange at an early date and the belief that the results of the Ottawa Conference would be beneficial, the directors were of the opinion that consigning was the best and safest policy. However, Ottawa proved

a failure, he. said, while the exchange rate was not increased until the latter end of January. <

On the account sales of 24 shipments the average price realised was 77s 7d .per cwt. Taking into account the later consignments on a rising market, that would be increased, a little. -With the exchange included the average price was 87s 2d per cwt, part of which was at the rate of £8 10s per cent and part at £24 per cent.

Early in May the butter market began to harden, and speculative offers were received from England through London importers.. The directors watched the market very carefully for some time, and on June 2, when they thought offers had reached their zenith, made a sale of 7500 boxes at lOd per lb. f.o.b. That covered the unshipped portion of the output and the remainder, of the make until June 30. At that time they had 3922 boxes afloat on consignment, which they made every' endeavour to sell at the same price, without success. AU those butters had since, been sold, and the average price received, plus exchange, would net not very far short of what they were prepared to sell at. In addition to the extra payments mentioned in the annual report they had been able t> add one halfpenny per lb. on butter-fat supplied' during December, bringing the average payment for the twelve months (up to that'point) to 9.14 d per lb. of butter-fat. Further realisations on the remaining consignments had enabled a further payment' of one penny per lb. on butter-fat supplied during December, and one halfpenny per lb. of butter-fat supplied during January. That made the final average payment fqr the year 9.33 d pep lb. butter-fat, which compared very favourably with any competitors.

The increased expenditure under the headings of factory wages, materials and cartage, oils, etc. was caused by the increased output of 65 tons, but notwithstanding the larger output fuel costs had been reduced by. £73. Management expenses as a whole had been reduced by £ll3, and export charges were higher by £143.

Expectations regarding the Ottawa Conference had failed to materialise. All had looked forward to the results of the World Economic Conference whiqh had just closed in London, but once again hopes for beneficial results seemed to have been disappointed. Nevertheless, in view of the fact that there was a possibility of a resumption of discussions in November they need not feel completely pessimistic. The butter market was steadily improving every day, and he felt very hopeful of' a much higher price level during the next year.

Mr. Marsh thanked his co-directors, the manager (Mr. G. T. Vile), the secretary (Mr. E. W. Garner) and the staff for their assistance during a very difficult year. He also paid tribute to the assistance and advice given by Mr. A. Dunlop, representative of the company’s agents. The secretary stated that there would be a furthei’ payment of Id over December and a halfpenny over January butter-fat. For the two . vacancies on the directorate there were four nominations—Messrs. G. Marsh, J. Kemp (retiring directors), A. Hall and R. H. Balsom. The election resulted in the' return of the last-named two. Mr. A. J. Tunbridge was re-elected auditor at the same fee as last year. The retiring directors were accorded votes of thanks and appreciation. The chairman’s honorarium was fixed at the same as last year—£7s, less 10 per cent. On the motion of Messrs. A. Jordan and C. Jordan it was resolved to circularise non-shareholding suppliers inviting them to take up shares in the company. The mover pointed out that unless the non-shareholdmg suppliers took up shares there was a danger that the company would become practically a proprietary concern in the course of a few years. Some discussion took place over the venue of the -annual meeting. Mr. Jackson moved that in future it should be held in New Plymouth, as he-con-sidered that the bulk of the suppliers now came from the other end of the district. Mr. R. E. Gilbert seconded. An amendment by Mr. A. Coroey that the meeting be held hi the Egmont Village hall as usual was carried.