WHAT OF THE FUTURE!

Waipa Post, Volume 48, Issue 3480, 16 June 1934, Page 5

WHAT OF THE FUTURE!

BANK CHAIRMAN’S REVIEW. PROSPECTS FOR DAIRY INDUSTRY. (Special to Waipa Post.) WELLINGTON, Friday. In the coulrse of his address as chairman at the annual meeting of the Bank of New Zealand to-day, Sir Harold Beauchamp, long recognised as a very sound adviser on financial matters, asked the question, “ What of the future ? ” in relation to New Zealands’ dairying industry. His conwients on the situation were as follows: “In respect of both butter and cheese it is apparent that New Zealand’s increasing production has been a considerable factor in bringing about the collapse of the market. “'ln the past, thanks to a steady demand for all our products at good average pricey, prosperity has. been achieved perhaps too easily, as is evidenced by the inflated values which have been, and in many cases still are, placed on farming properties. Adjustment of values, which has been delayed by the legislation protecting mortgagors, must now be faced, if, as appears almost certain, quantitative restriction is to be imposed.

“ Our established policy of encouraging the settlement of people on the land will obviously require revision in so far as it would involve the further production of “ quota ” products. Can we find new markets for our butter and cheese ? I am not confident of success in this direction. Britain must still be regarded as practically our only overseas market, and any increased demand for our dairy produce under quotas will probably be due mainly to the failure of our competitors through climatic or other causes to maintain their output. “ If the quantity of dairy produce which New Zealand may export to Britain is to be limited, it is most essential that the quality should be of the highest standard. The aim of those controlling the industry must be to win the favour of an increasing circle -of consumers, so that there will be an insistent demand for ‘ New Zealand.’ If this can be achieved, we may hope to receive compensation for a reduction in quantity. “ Disturbing though the outlook is, it may be helpful to our development as a self-reliant people that we should be forced to call a halt and take stock of our position. “ I have said that the development of New Zealand has proceeded on the lines of always having a free market in Britain for her produce, and it is equally true that (with the exception of the war loans) New Zealand’s debts, overseas and internal, have been contracted in the same belief. Of the total national debt of £280,000,000, of which approximately £BO,000,000 was incurred during the war years, over £161,000,000 is domiciled in London. Local body debt also domiciled in London amounts to a further £17,000,000. As the shipment of produce is New Zealand’s only means of providing for the service of her overseas debts and of paying for her purchases of British goods, it follows that restriction on the entry of New Zealand’s produce into Britain will Ultimately have the effect of l.miting the funds' available for these purposes to the amount realised for such produce. T , , “ What of the future ? It would be against all the teachings of historv to assume that the industry will not recover. It must recover, for the dairy industry holds too strong and prominent a place in the world s economics to remain continuously depressed. “An ’ adjustment between supply and demand is, of course, imperative. It is believed that the production in New Zealand next season will be less by 20,000 tons to 30,000 tons than has been recorded for the season now closing. “ The recovery of the dairy industry must be through natural processes if it is to be real and of some permanentiy. The very highest standard of quality must be insisted on. But I have no belief in “ planned economies.” In my opinion the industry needs advice, help, and sympathetic treatment, and the rest should be left to individual farmers, who, after all, are actuated by the natural Desire to make a competent living. Undue interference with the industry, and efforts to place it in a straitjacket with a fancy name, are the chief dangers menacing the dairy industry.”