HELPING PRODUCTION.

Waikato Times, Volume 102, Issue 17008, 22 January 1927, Page 6

HELPING PRODUCTION.

CHEAPENING COST. FARMERS AND FERTILISERS. WELLINGTON, fLMay. In an interview, Mr W. Goc'Wdlow, managing director of the New Zealand Coropcralive Dairy Go., Ltd., staled lhat the sudden drop in the price of fertilisers was not altogether unexpected and was entirely due lo the fact that the New Zealand Co-operative Dairy Go. had recently concluded an important conlract for the permanent supply of fertilisers to the company’s suppliers on very favourable terms.

For some months past negotiations had been proceeding with the fertiliser manufacturers for the supply of fertilisers on the same terms as those accorded wholesale merchants, but these negotiations had proved abortive, and in consequence the dairy company had been- forced to attain its objective in another way. On February 1 a new company would take over Messrs Wright, Stephenson and Co.’s modern works at Otahuhu. The New Zealand Co-operative Dairy Co. would invest £50,000 in preference shares and in terms of the agreement already colored into the 8000 dairy farmer suppliers of the company would in future secure fertilisers at net cash wholesale rates. Further, at the end of each season the dairy company’s suppliers would receive a rebate consisting of the manufacturer’s profit on total purchases up (o 50,000 tons per year, after providing for interest and depreciation. “On and after February i next, therefore,” said Mr Goodfcilow, “the dairy company. suppliers will be in the exceedingly fortunate position of being able to buy fertiliser at merchants’ rates and on c.xiended terms if required.” The contract with the Challenge Phosphates Company. Ltd. (as the new fertiliser company will be called —not Fertilisers Ltd.), specifically provides that all rebates shall be passed on to the dairy company's shareholders oilier titan a nominal" charge lo cover the cost of distribution, which will probably amount to not more Ilian 2s Gd a ton. The suppliers of the dairy company will not require to take up any shares for fertilisers or incur any further liability in any way. The directors of the company bad already decided to place £25,000 to reserve fund for two years, and this money would be invested in' preference shares in the Challenge Phosphates Co., Ltd. The saving in the cost of fertiliser to the shareholders of the company would more than provide the capital required in the first two years, and would also ensure cheap fertiliser for all future need. A big reduction in the price of phosphates would undoubtedly, result in increased production, which in turn would have a very helpful effect on town and country alike.