TRADE RELATIONS

Wanganui Chronicle, Volume LXXXIII, Issue 20110, 31 March 1928, Page 7

TRADE RELATIONS

RECIPROCITY PROBLEM’ The Commonwealth and the Dominion MR PRATTEN’S VIEWS. [ Per Press Association. ) WELLINGTON, Alarch 30. The Hon. H. E. Pratten, who left by the Alaunganui for Sydney to-day, stated something about the butter, wheat, ami flour trade problems, subjects upon which he had not previously touched in the course of his tour. Mr Pratten explained at some length the operation of the “Paterson butter plan,” which he described as a nonpolitical and entirely voluntary co-op-erative movement amongst the dairy farmers aud butter jiroducers throughout Australia. “Both the Commonwealth and this Dominion have, unfortunately for a complete understanding between us, much the same climate and productions, which make a generous reciprocity difficult,’’ said Air Pratten. quite agree that the freer we can make trade between us the better it will be for each Dominion, but our trade relations seem to revolve more than they need round the questions of butter and wheat and flour. After explaining in detail the object and effect of the Paterson butter plan, Mr Pratten stated: “Seeing that Australia is an exporting country, it is obvious that every pound of butter imported into Australia, while there is a sufticicncy of local supplies, forces the exportation of an equal quantity that otherwise would be consumed in the country, and the importation into Australia of say 8,000,0001 bs. of butter from New Zealand necessarily costs the dairy-industry 3d per lb. upon a similar quantity exported, or £lOO,OOO directly out of the farmers’ pockets. In order to re establish thhe position as it existed before the operation of the Paterson plan it was necessary that the cost of New Zealand butter should be increased to Australian domestic parity. The Australian butter industry raised the export bonus from 3d to 4d per lb. 1 his would have the result of increasing the domestic price 4d per lb. over London parity. This increase was

found unworkable and 3d per lb. was reverted to, but the rate may be mad< 4d when the duty of 6d becomes operaHe asked the daiy farmers of New Zealand to closely examine the position. They in Australia wanted to give their farmers some benefit out of the home market, so that the consumers of butter who wore largely benefited by Arbitration Court awards should give a little help to the dairy industry. “The Paterson plan is designed to improve tho conditions of the Australian dairy farmer,” he said, “and Australian butter makers and cream suppliers pay a voluntary levy to improve 'their net returns, and this is being do* fcated by the dealer in New Zealand butter, who scoops the profit to tho extent that his importations prevent tho Paterson plan from functioning in tho matter intended. The producers of butter in New Zealand are getting no bigger net return from the export of their butter to the Commonwealth than they arc from the export of their butter to Britain, Canada, or any other place. Whatever profit is being made is, 1 hazard the opinion, going into the pockets of the dealers, jobbers, exporters, and importers, and the dairy farmers of New Zealand are being urged to prevent their brethren in Australia getting higher pricct in their local market to which they an entitled by reason of the increasing costs of production.” With regard to wheat and flour, the New Zealand policy was to become independent of outside supplies—exit, therefore, the Australian trade. Thfl general trade between the two countries had changed in the last few years to a great extent, and the balance was now nearly even. “How in the world we are going to solve our trade problems and get together and please everyone, I frankly do not know,” concluded Air Pratten. “The only way out of this difficulty is for each country to give what wc can without hurting the agrarian or other special interests of either Domin-