THE DAIRY MARKET.

Waikato Times, Volume 107, Issue 17964, 8 March 1930, Page 7

THE DAIRY MARKET.

SITUATION IN BRITAIN

ADDRESS BY MR GOODFELLOW. NEED FOR BETTER CONDITIONS. WELLINGTON, Friday. Mr W. Goodfellow, managing director of the New Zealand Co-operative Dairying Company, Limited, in commenting on the London dairy market said a striking object lesson was being given the New Zealand and Australian dairy producers of the imperative necessity for better marketing conditions. The situation on the London market was that while Danish buLLei was commanding a price of 1625, the situation of New Zealand butter war given as “ now steady at 140 s. A Cablegram a few days ago stated that the market was demoralised, and the latest information apparently meant that prices had even gone into the 130’s, where they had not been for a number of years. The Danes consistently placed upon the market soijie 2000 tons of butter every week, and, by the steady demand they had built up, had been enabled to maintain a fair level of price, fhere was no equity in a situation which placed New Zealand produce at ovei 20s disparity, and producers weic forced into recognising the fact tha 1 their disunited marketing method.-, were out of date.

The Position Serious. “ I have long predicted,” said Mi Goodfellow, “ that as soon as Australia and New Zealand had good producing seasons, the position of the London market would he serious anil our marketing would suffer a severe strain. That position is obtaining this year.” New Zealand’s export for the producing season would he approximately 90,000 tons of butter, and the Australian export, which last year war approximately 40,000 tons, would Hin year exceed 60,000 tons. ■ In spite of the fact that, fortunately some 18,000 tons of New Zealand butter had been diverted to Canada, the London market, having knowledge o the heavy (Production. in the Antipodes, had weakened. This weakening process was markedly accentuated by 1 e trading conditions obtaining in London. In place of the numerous buyers who competed against one another in the past, the big amalgamations of the present day employed one buyer and pooled their stocks as required when it suited them to stand off the market to bring prices down to the level the} desired. Must Eliminate Competition.

Asked what remedies for the situation could he proposed, Mr Goodfellow said the first lesson to be learned by the producers was that, they must adopt the practice of their opponents and eliminate competition among themselves as sellers, just as the buyeis had eliminated competition among themselves, it -was futile for 500 independent dairy companies in New Zealand to compete among themselves on the London market. The sensible course was for organisation, with the ideal, if possible, of a national group controlling at any rate the larger proportion of the sales of New Zealand produce. . , 'Hi addition to that course, into which producers would practically be forced bv economic circumstances, agitation should be made on the London market to urge that the Merchandise Marks Act, passed by the British Parliament, should be put into operation, and branding be adopted in respect of all imported butters. This.-would rectify the position of blended butter. If that regulation could be adopted it would materially improve the position for Empire producers. Co-ordinated marketing on the part of producers would also enable efforts to be made to develop the hitherto unexploited market of northern Britain. At present 92 per cent, of Australian and New Zealand butter going to Britain reached London, -which served the food requirements of only 53 per cent, of Britain’s population.

Empire Free Trade. The present situation emphasised the need more than ever of attention being given to the development of Empire free trade, or at any rate freer Empire trade. Great Britain was the only sure market that the New Zealand producer had. While about 18,000 tons of butter had been sold to Canada last year, it was quite uncertain how long that market would remain open, as there were prospects of the United States imposing a tariff against Canadian milk and cream. If that were done that milk and cream would be manufactured in Canada into butter and cheese, and the Canadian Government would be forced to erect a tariff against New Zealand. While the outlook was not as bright as it had been on occasions, said Mr Goodfellow, he was by no means pessimistic. There certainly existed occasion for serious thought, but the problem could be seen and steps must be taken to cope with it. The. first essentiabwas adequate attention to marketeting. The producers, which meant the whole of the Dominion, were losing millions of pounds a year through inefficiency in this field. The first step for the producer to take was to copy the tactics of his opponents, which were to amalgamate to eFect economy and eliminate unnecessary competition. If the New Zealand producers would work together, and, in turn, co-operate with the Australian producers, then a very great deal could be done for the national advantage in the interests of all.