DAIRY PRODUCE TRADE

Timaru Herald, Volume CV, Issue 160, 28 September 1916, Page 4

DAIRY PRODUCE TRADE

SEASONAL REVIEW. BY N.Z. LOAN COMPANY. The following is the N.Z. Loan Company's seasonal review of the .Australasian dairy produce trade in London for last season:—

Butter. —The season just terminated is noteworthy for the high level of value which prevailed, prices having touched the highest point over known, in tho annals of the trade. This result was [nought about by the drought in Australia, ~ whence during tho winter months large supplies usually are drawn to Plome markets, aud the short supplies received, in consequence of tho war, from Russia, Siberia, France, and Denmark. In some cases these deficiencies were the outcome of export prohibitions by the respective Governments, and in the case of Denmark on account of the extreme figures paid by Germany. The Imperial Government, moreover, made large purchases of Irish butter during tho season, and in consequence the surplus available for the general trade was not sufficient to meet requirements, and a. steady demand throughout prevailed. In October, 1915, alter a period of stagnation, the market slumped to a. serious extent, but this was at a tiiue when owing to stocks of choicest being extremely limited, prices for this description had been forced up out of all relation to those ruling for other grades. With the. arrival of the fisst Australian and New Zealand shipments, there was a better enquiry for the best butter, but secondary and inferior goods, which consisted mainly of " old stored" Siberian, were in over supply, and met- a bad sale-. The news that in consequence of drought in Australia there was the possibility of no exports being made thence, together with the announcement of a prohibition order in New South Wales, caused some inclination to speculate early in December, but just before Christmas, with heavy arrivals of Australian and Danish, prices dropped heavily, .New Zealand declining from 16s to 20s in 21 days, while with pressure to sell, a, further drop took place of from 4s to Ss, and it was not' until January, when France prohibited the export of imsalted butter that prices recovered. From time to time large arrivals of Australasian came to port, but the discharge of carrying steamers being delayed as the result of numerous labour difficulties occurring at the clocks, they were readily absorbed by the trade as they became available. I'roni this point, with the exception of a temporary set back at the end of' January prices continued to. advance,' touching the highest point at the end of June, when choicest New Zealand ruled at from IPSs to 170s, and Australian from 158s to 160s per cwt. There appears every prospect of this state of affairs continuing until Russian exports aro_ resumed, which from present indications does not appear lil'ely for many months. to come.

Quality.—Owing to the drought in Australia,,a considerable proportion.of the best quality butter was retained for local consumption, and therefore the quantity of choicest shipped thence was restricted. Generally speaking; the quality gavo satisfaction, 1 ; although many heated and faulty parcels, attributable no doubt to the cause named above, came to hand. New Zealand butter, we are glad to say, was highly satisfactory in spite of the difficulties in connection with-labour and transport experienced. ■'.- --.■-.'■ . .> .-

Cheese.—Extraordinary prices, far exceeding any every previously recorded, were realised during the - season just ended. At the opening, -with the withdrawal of Army orders, more be-' came available for general trading;,pj(irposes, and in consequence ened, while throughout■••;' July „ 'and August, of ' 1915. dull m£|rkets;::ancl declining '.prices ,were.,;J,h;e nilS, tlie speculative section 'being unable to formulate any ideas as ..to- the, advisa T bility-br otlierwise;/bftpperating '.'forward;'' : .Ne.w Zealand;, factoring. yfcre then asking from ,76s c^f^'for outputs, and. some were unfortunate "in haying "their offered more bold' of the JlbmeJtrade operators, but generally business oil such terms was declined. The future intentions of the Government authorities were well guarded, "and it „was. only after it became known thsyt;lai'ge operations had; taken place in Canada, v> .where some 150,000 cheese were- puiehased on that account that Tooley Street showed any disposition to buy for future delivery. In October, when the British, in conjunction with the New Zealand Govern-; ment, requisitioned some 15,000 tons of the season's output, and made further heavy purchases fn-Canada, the market strengthened. . From that time, with the exception of. a .temporary check in February, prices advanced continuously, reaching their- highest point in May, when New Zealand cheese touched 114s per cwt., a hitherto unrecorded figure. When increasing quantities became available from Canada, United States, and the Home. Country, as was to be expected, this position was not maintained, and at the close prices ruled at. from 94s to 96s for Canadian, and from 96s to 100s for New Zealand, while a dull tone prevailed. Tliose factories which consigned throughout the season have every reason for satisfaction, and 1 we venture to express the opinion that producers will do well to adopt a like course next season. There were no ■ shipments of cheese from Australia owing to the extraordinary position Xnevailing there; all supplies being absorbed on the local markets.

Quality.—AV© regret that the quality of New Zealand cheese was not generally fully maintained, and while this was, doubtless,' owing' to causes arising from the war, beyond factories' control, it cannot too strongly be urged l that, every effort should be made to keep' up the visual standard of excellence. " Owing to the general shortage in supplies, however, buyers were less critical than in ordinary seasons, and in consequence faulty parcels sold to better advantage than otherwise would have been the case. Prospects for next Season.—The course- of future events must of necessity depend upon the duration of the war, but even although an early collapse should take place, military-re-quirements may bo expected to continue to 7nake large inroads into both butter and cheese. As regards .the former, supplies so far are comparatively light from Ireland, ■ France . (a partial prohibition of exports'- .prevails ,:.in that country), Denmark, "and Holland, while Russia is; exporting nothing, her supplies being retained 'for. home purposes. From and New'-Zea-land no relief is to be for.•until the new season opens, and ; : meaiiwhile margarine is coming more and more into favour ;as a' substitute, sales-hav-ing now reached an unprecedentedly largo figure/ We are of opinion, .however, that there" will-always be a. large section of the community which; will continue to demand butter, arid it is for that class that Australasian producers should set themselves to cater by keeping up the standard of quality to the highest possible : pitch, by which means good outlets will be secured. In the case of cheese, although present values are lower than they have been, there is no cause for pessimism .amongst cheese producers, as prices still show a handsome return for their labours, and in view of the largo food requirements of the great armies there seems no good reason at present to fear a col la ] ise: It may reasonably be assumed that the Government will ere long again (.-nine into the markets for the purchase both of Canadian and New Zealand, and in such case the quantity available for general consumption during the .season of HiKi-i" will lio proporcurtailed and wc tiling, that

good prices— -though possibly nob so high as. those -realised during the season just closed—may be looked for. The outlook, we consider, is certainly cncuoruging, and " shipment on consignment" next season may be advocated 'as.likely again to prove the best policy for producers.