BUTTER AND CHEESE

Waipa Post, Volume 52, Issue 3705, 10 January 1936, Page 7

BUTTER AND CHEESE

REPORTS AND PROSPECTS. STEADY MARKET PREDICTED. In their latest review o£ the dairy produce market, Messrs A. H. Turnbull and Co., Ltd., New Zealand agents for W. Weddel and Co., Ltd., London, say:— Butter: The market continued to decline during the early part ot December, but bottom was reached about the middle ot the month, with prices on the level ot 86s to 87s per cwt. Messrs W. Weddel and Co. Ltd. cable us that the market advanced after this date, chiefly on account of the continued reduction in Australian gradings caused by the drought conditions in New South Wales and Queensland. They also advise that the lower prices stimulated consumption considerably, and this caused a reduction in the stocks of butter in the United Kingdom, with a consequent strengthening in the general tone of the market. Prices rose up to as high as 100 s for N.Z. butter, but our latest advices are to the effect that the market is weaker and N.Z. quotations have declined to 98s per cwt.

Messrs W. Weddel and Co., Ltd., are of the opinion that the weaker market is probably only a temporary phase, due to the fact that prices have shown such a very acute increase during the past fortnight. Much will depend on the production position in Australia, but provided their shipments continue on the low side, prospects are for a steady market.

Cheese: Cheese has shown a very steady advance in line with butter, and our principals advise us that the continued reduction in N.Z. gradings and shipments, and also the fact that it is anticipated that the Home production will be considerably lower than last year, have both caused buyers to become somewhat nervous and consequently the market has shown a considerable improvement. As in the case of butter, the latest advices are that the market is somewhat slow and irregular, but here again our principals think that the check is chiefly due to the very sharp advance over the past week or so, and that the prospects are for present prices to be maintained. Considerable activity has been shown in forward cheese, and quite fair quantities of December-January make have been sold at as high as 6d per lb. f.o.b. The extended review of the market, from Messrs Weddel and Co., dated London, November 21st, shows that the total arrivals of butter into the United Kingdom from all sources during the month of October were 726 tons less than during the corresponding month of last year. On the other hand, a comparison with the previous month (September) of this year shows an increase ot 2,252 tons. During the ten months ending 31st October, 1935, the total importation amounted to 410,312 tons, as against 420,369 tons over the same period in 1934—a decrease ot 10,057 tons. Notwithstanding the fact that arrivals of butter during October were in excess of those of September, stocks held in the various cold stores throughout the United Kingdom continue to decline. Latest returns, made up to the 9th November, show a total of 13,400 tons —3,948 tons less than the quantity declared four weeks ago and 8.541 tons below the quantity on hand a year ago. Shipments at present afloat from New Zealand, Australia and the Argentine are about 1,300 tons less than the quantity afloat at the same time last year. A start has been made in shipments from the Argentine, where conditions are reported to be now tending towards normal, but the production of ' milk and cream is estimated to be still about 40 per cent below the same period a year ago. In our last report, dated 21st October, reference was made to an easing off in the demand with a decline of 3s to 4s per cwt in values, an advance in prices on the retail counter and to a certain element of nervousness in the position in general. Unfortunately subsequent events have proved that those signs were the beginning of a very sharp reaction in the butter market. During the four weeks now under review, prices of New Zealand butter have declined no less than 20s to 21s per cwt, and in the case of Australian from 21s to 23s per cwt below the quotations last recorded. In view of the apparent strength of the statistical position this reaction, to say the least, was unexpected, and is somewhat difficult to explain. It would appear, however, that the sharp advance in prices which had to be made on the retail counter considerably curtailed the consumptive demand and buyers, fearing the high level to which prices had been forced, decided to work down their available stocks before incurring any further commitments. This resulted in a very marked falling off in the general demand, and with the desire to sell very apparent in some quarters, the market became unsettled, the aforesaid sharp decline in values took place, and at the close prices were irregular. In the meantime about 115,000 boxes of butter have arrived from Canada, and although no further supplies are expected from this source, the arrival ot these goods did not in any way help the position. During the past week or so, with a view to stimulating the consumptive demand, prices have been reduced on the retail counter, and it is to be sincerely hoped that this move will in due course have the desired effect. Cheese: More or less similar conditions to those pertaining to butter have prevailed on this market. In the case of New Zealand cheese, the easier tendency referred to in our last report further developed, and during the past four weeks, with a very fluctuating demand ruling, values have declined 9s per cwt below those last recorded. The market for Australian cheese has also followed on similar lines to that of New Zealand. In regard to Canadian cheese, the demand throughout has been slow for stocks on spot, while c.i.f. quotations have been 62s per cwt for the September make from the best sections.