DAIRY PRODUCE TRADE

Wanganui Chronicle, Volume 80, Issue 250, 21 October 1937, Page 11

DAIRY PRODUCE TRADE

LOW BRITISH PRICES. INFLUENCE OF MARGARINE. LONDON, Sept. 18. “The average price of all imported butter sold last year, except Danish, was probably under £lOO a ton. At that price it is a hard struggle for the farmers in the Dominions and in foreign countries to make a living without a subsidy,” states the 43rd. annual review of Britain’s imported dairy produce trade issued by W. Weddel and Company, Limited, for the year ended June 30. Weddel and Company go on to say that the retail price apparently has to be kept at an unconscionably low level in order to maintain the demand in face of the competition of margarine. The result is that butter is one of the few commodities still sold to the consumer at well under pre-war prices, and the retail trade last year sold a great deal of it at a loss. Production Problems. It would seem therefore that higher retail prices are not likely to be the solution of the producers’ problems. As soon as prices are raised beyond a certain point the demand falls away. British consumers are prepared to pay up to, say, is 2d per lb. for butter—perhaps a little more in prosperous times. Beyond that a great many of them turn over to margarine, a much cheaper substitute which is always available in plentiful supply, and in its best form not easily distinguishable from butter.

What the ultimate outcome of the situation will be it is impossible to say. In the old “laissez-faire” days production would decline for want of a profitable market, but nowadays production is artificially stimulated, either officially or co-operatively and the consumer buys at under cost price.

Weddel and Company regard the New Zealand Government’s guaranteed price scheme seemingly to have worked smoothly for all concerned. The Dominion had a record production and export of butter last season, but that is said to be due more to the favourable weather than to the guarantee. Cheese production was only slightly increased, and the actual arrivals in this country were smaller.

Apart from New Zealand there was a regrettable decline in butter and cheese production in the Dominions last year, although nearly all the foreign countries shipped increased quantities, in spite of the 15s per cwt. import tariff, and in some cases no Government assistance. Australia’s Price Gain. New Zealand and Australian butter prices fluctuated between 82s 6d and 122 s per’ cwt. with averages of 104 s Id and 103 s 6d respectively. Danish butter had a much smaller range 108 s and 1295, with 119 s 8d as the average for the year. In recent years there has been a distinct tendency for prices of all descriptions of salted butter, wit* the exception of Danish, to approximate each other in price. New Zealand and Australian are now quoted at practically the same level, and rightly s °> comments the company, in view of the Immense improvement in the quality of Australian. But when Continental butters are only a few shillings per cwt. behind, and on some occasions even ahead, it brings home the undoubted faet that the Baltic and Scandinavian countries are sue ceeding in their efforts to bring the quality of their product up to the highest standard.