THE DAIRY FUTURE.

Thames Star, Volume LXIV, Issue 17833, 7 March 1930, Page 5

THE DAIRY FUTURE.

ERA OF FALLING PRICES.

Dominion's Only Safeguard.

CONTROL OF DISTRIBUTION.

EMPIRE FREER TRADE. The dairy industry, according to Mr. W. Goodfellow, managing director of the New Zealand Co-operative Dairy Company, is faced with a period of falling prices during' the next 10 years. He bases his opinion on his own observations and the statements of the world's leading economists. Addressing the Australian dairy delegation, at a dinner given in their honour at the Hamilton Hotel, he spoke at length on marketing conditions and future prospects. In toasting the dairy industry, lie stated that the commencement of an improvement in the marketing ol New Zealand dairy produce in the. United Kingdom dated back 11 years, when the New Zealand Dairy Association amalgamated - with the Waikato Co-operative and: Thames Valley Coqpe'rative Dairy Company to form the New ' Zealand Dairy Company. He then briefly reviewed the progress made by the establishment of a'London office and the appointment 3)l' Mr. J. B. Wright as London manager of the company, not to sell produce, but to co-ordinate the work of the company's agents and thereby eliminate unnecessary competition in the company's goods. Practically every dairy director in New Zealand to-day would 'agree, stated Mr. Goodfellow, that the policy inaugurated by the New Zealand Dairy Company in fixing prices, auditing account sales and eliminating competition, had undoubtedly resulted in better average prices being obtained by ,'ali dairy companies. Mr. Goddfeilow then briefly referred to the ijiiilure of the New Zealand Board and explained' the reason for' the; subsequent establishment of Amalgamated Dairies. He emphasised the tact that the dairy industry now had adequate representatives on, the board of direct-, ors of Amalgamated. Dairies and it was the objective of the company during the next: seven years to develop a nationaj marketing organisation. He stated that they were now doing export business for 48 dairy factories in addition to handling the total exports for the New Zealand Co-operative Dairy Company, and that the company anticipated consigning and selling upwards of 40,000 tons of .New 'Zealand butter and cheese dm> ing the current sea son. Empire Dairies.

Mr, Goodfellow then dealt with the constitution and object of Empire Dairies, arid pointed out that half the capital ; had .been subscribed by Amalgamated Dairies and the balance would be,-held by Australia and other Empire countries. The control, however w r ould remain in the joint hands of an equal number of directors ar> pointed by Australia and. New Zealand and no resolution could be carried without' Australia and New Zealand being in agreement and this, he considered, was an important safeguard for the future of the organisation.

Continuing,--, he stated that Amalgamated Dairies' marketed its London consignment through six agents in addition to Empire Dairies and owing to the large quantity of produce to be handled only a, limited .. quantity could l>e sold by Empire Dairies until the organisation had been developed in London and the outports of the United Kingdom. It would be madness, he added, to force sales ur New Zealand produce through Empire Dairies, as such action would result in reduced prices to the producers of both countries. Empire Dairies would be developed and increasing quantities of- New Zealand produce would be handled. The speaker stated that the necessity for Amalgamated and Empire Dairies was to changing conditions • of trade. Amalgamated Dairies aimed to eliminate existing harmful competition on the London market by New Zealand Co-operative Companies, while Empire Dairies was designed to eliminate competition in Great Britain between important Empire marketing groups trading in London. The speaker went to considerable trouble to explain the magnitude of the London multiple shop organisations and mentioned that since Lever Brothers had amalgamated with the Margarine Union, the ordinary capital and reserves of the Margarine Company were approximately £27,000.000. This company, buying for' its thousands of shops was now not only the biggest manufacturer of margarine, but the biggest buyer of imported butter. He pointed out further that the Co-operative Wholesale Society, although an organisation excellent in principle, was designed for the purpose of selling cheap food to the British worker and was therefore diametrically opposed to the co-opera-tive producer, who was anxious to receive a fair market value for his produce. Buying Collectively. Mr. Goodfellow also referred to the federated" grocers' organisations which had been established in many parts of the United Kingdom for the express purpose of enabling the small grocer to buy collectively in order to successfully compete with the "multiple shops and co-operative stores. There was no doubt, added the speaker, that the buying the bulk of New Zealand's butter and cheese in London was to-day in the hands of a comparatively few people and the only way for the producers to successfully meet this position was to link up- with Amalgamated Dairies. If they could secure 60 per cent, of the consignment of butter going to the United Kingdom and co-operate with other countries through Empire Dairies, they could unquestionably to a large extent counter the great advantage gained on a weak market > by the buyers.

(To be concluded to-morrow.)