WORLD BUTTER TRADE

Timaru Herald, Volume CXLII, Issue 20512, 2 September 1936, Page 11

WORLD BUTTER TRADE

PROTECTIVE MEASURES A feature of world trade in butter in recent years has been the protective measures adopted by many countries as a result of the crisis developing in the agricultural industries. Some European countries have virtually cut themselves off from world trade in dairy produce, which move has raised domestic rates to levels well above those on the open market in London. Taking as a base 100 equals the average price ruling in 1931 in the countries compared, the movement in butter prices in the past five years has been as follows:

The London price is based on New Zealand finest salted butter, prices for which also form the basis of the following table, comparing values for similar types of butter:—

The dairy produce survey of the Imjerial Economic Committee states that the protective measures adopted tended to destroy the fairly close relationship Which had existed between butter prices in the main importing countries. Previously the margins had mainly reflected the incidence of tariffs, but the measures, often involving quantitative restriction, brought into force from 1931 onward, have been followed by wide disparities in quotations ruling at any one time in the chief markets. In 1932 and 1933 very high prices were

reached in certain markets.

In spite of a general continuance and extension of restrictions, however, butter prices in certain countries fell in 1934 and 1935. This occurred in France and Belgium, countries which are almost self-supporting and where home production has increased. As a result, the seasonal movement in prices has tended to be accentuated, and quotations in the summer months approached world levels. The reduced autumn consumption, however, caused a marked upward movement towards the end of 1935. The control over all phases of the trade in Germany is seen in prices which were officially maintained throughout 1935 at a level rather in excess of that of a year earlier. In the United Kingdom, where restrictions have been confined to a tariff on foreign supplies, prices have remained much lower than in other importing countries, even taking into account the depreciation of, sterling.

1931 1932 1933 1934 1935 London . 100 90 72 64 80 Denmark 100 85 81 77 91 Germany 100 89 87 100 101 France . 100 100 97 86 72 Belgium. 100 91 96 88 86

1935 1934 (average) (average) d. s. d. London . . 91 9 73 8 Denmark 87 3 73 0 Germany . . 212 0 199 3 France .. 180 0 208 9 Belgium .. 137 9 172 0