PRIMARY INDUSTRIES

Waikato Independent, Volume XXIX, Issue 3101, 22 June 1929, Page 2

PRIMARY INDUSTRIES

YEAR OF STEADY DEVELOPMENT. BANK CHAIRMAN’S REVIEW. Dealing with the Dominion’s primary industries in the report to the annual meeting of shareholders of the Bank of New Zealand yesterday, the Chairman said: — ' The year just ending has seen a steady development in this growing industry. Weather conditions have been favourable; top-dressing and better methods of cultivation have been more widely adopted; and the responding pastures have never looked better. As a consequence, the yield of butterfat products this season has been a record, and prices have been satisfactory. Apart from the amount consumed locally, 80,278 tons of butter were exported, valued at £13,141,494, for the year ended March last, compared with 78,915 tons, valued at £11,964,431, for 1928. Cheese exported totalled 85,458 tons, valued at £7,296,804, compared with .78,222 tons, valued at £6,092,900, the previous year.

Butterfat products have taken pride of place in the Dominion’s export trade, and everything possible should be done to maintain the quality, for it is on quality that the future of the industry depends. Unlike Australia, New Zealand has increased and extended her overseas trade without the assistance of a* Government bounty or export bonus.

With the idea of stimulating her dairy industry, the Australian Government sanctioned an ingenious scheme, put forward by the producers and known as the “Paterson Plan,” under which a bounty or bonus is paid on all butter exported. The payment of this bounty or bonus has brought about an increase in the local price of butter of 4£d per lb, and it has been the direct means of the United . States of America deciding, as a retaliatory measure, to increase the duty on imported Australian butter. Thus at the stroke of a pen all the' benefits estimated to accrue to the Australian industry have been wiped out in the United States, and in response to the agitation going on there at present it seems probable that Canada may follow suit. It appears evident that if the Australian export of butter is stimulated by the bonus and at the same time handicapped by counter-balancing duties in certain countries, the bulk, of it would find its way to the United Kingdom. In that case, unless Great Britain, too, were forced by public opinion to defend her own farmers against a State };ounty-fed article, the result might be over-supply and a reduction in price, a serious event for New Zealand, as for every butter-producing country. The granting of a bonus or bounty on any article exported is a dangerous expedient which may lead to unforeseen complications; indeed, an artificial trade stimulant such as this tends to bring in its train more loss than gain with effects reaching far beyond immediate vision. At the Geneva Economic Conference in 1927 the payments of bonuses on exported products was considered inimical to the peaceful trade of the world, and rcsoTutions were passed condemning the continuance of the practice.