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H.—3o.

A Dutch and a Russian Ship unloading in the Night at Hay's Wharf, London, directly beneath the Offices of the Primary Products Marketing Department, which are shown brilliantly lit.

Frontispiece.]

H,— 3o

CONTENTS.

A. Accounts — Page Annual .. .. .. . • . • . • • • 36, 39—45 Dairy Companies .. .. . ■ .. .. ■ • 33 Advertising and Publicity .. .. . ■ .. . • .. 22 Arrivals at United Kingdom Ports .. .. .. .. 15 B. Butter — Consumption . . .. .. .. . . .. 21 Imports . . . . .. . . . ■ . • • • 30, 46 Prices . . .. .. • • • • •. ■ ■ 30, 50 Purchases, Quality of .. .. . . .. .. 8 C. Cheese— Consumption .. .. .. .. .. .. 21 Imports .. .. .. • • ■ ■ • • • • 32, 46 Prices . . . . . • • • • • • • • • 30, 52 Purchases, Quality of .. . . . . .. .. 9 Costs of — Dairy Companies . . .. . . .. . ■ .. 33, 34 Farm Working and Maintenance .. .. . . .. 5 Cold Storage in United Kingdom .. . . .. .. . . 26 D. Dairy Industry in Great Britain .. .. . . . . . . 20 Dairy-produce, Purchase of, by Crown .. .. . . . . 4 E. Exports — From New Zealand Ports .. .. . . .. .. 11 To West Coast Ports, United Kingdom . . .. .. 15, 47 F. F. 0.8. Selling .. .. .. • • .. .. .. 19 Freight Kates .. .. ■ • • • ■ ■ • • 26 G. Ghee .. .. .. •• •• •• • ■ 32 Gradings— 1935-36 and 1936-37 .. .. .. .. .. .. 10 Quality Percentages .. . . .. .. .. 8 Guaranteed Prices, 1936-37 and 1937-38 .. .. .. . . 7 I. Imports into United Kingdom— Butter .. .. . ■ ■ • • • • • • • 30, 46 Cheese .. .. . • • • • • • • • • 32, 46 Insurance Rates .. .. ■ • • ■ • • • • .. 26 Internal Marketing Division . . . . . . . . . • ~ 37 M. Margarine and Butter Consumption .. .. . . .. .. 21 Market Conditions, 1936-37 .. . . .. . . . . 28 Marketing Methods — History of .. • ■ • • • ■ • ■ • ■ .. 11 Objective of Department . . . . .. . . . . .. 14 Effect of Elimination of F. 0.8. Sales . . . . .. 19 P. Payouts by Dairy Companies .. . . . . . . .. 33, 34 PricesAverage of Eight to Ten Years for Guaranteed-price Basis . . . . 4 Guaranteed Purchase, 1936-37 and 1937-38 .. ~ . . 7 Trend, 1936-37 . . . . . . .. • • • • .. 28 In London . . .. . ■ ■ • • • 30 Paid and Realized .. .. . . . • ■ ■ . . 36 Primary Products Marketing Act .. .. .. . • 3 Procedure of Payment, &c., in New Zealand . . . . .. 9

I—H. 30.

H.—3o

CONTENTS —continued. Q. Quality— Page Of Produce purchased .. .. . . .. ~ .. 8 Premiums for .. .. .. . . _ 7 S. Sales— To Ports outside United Kingdom .. .. .. .. .. 27 In United Kingdom : Weekly Graph . . .. .. 12, 13 Shipments to— West Coast Ports, United Kingdom .. . . .. .. 15, 47 Outside Markets .. .. .. .. ~ _ 27 Shipping .. .. .. .. .. .. 24 Shipping Inspection .. .. .. ~ .. . .. 25 Storage in United Kingdom . . .. . . . . _ , 26 Store Warrant Advances .. . . . . 10 W. World Trade in. Butter and Cheese .. . . .. .. 49, 54

2

H,— 3o,

1937. NEW ZEALAND.

PRIMARY PRODUCTS MARKETING DEPARTMENT ANNUAL REPORT AND ACCOUNTS FOR THE YEAR ENDED 31st JULY, 1937.

Presented to both Houses of the General Assembly pursuant to the Provisions of the Primary Products Marketing Act, 1936.

Sir, — I have the honour to submit the annual report and Statement of Accounts of the Primary Products Marketing Department for the year ended 31st July, 1937. INAUGURATION OF DEPARTMENT. The Primary Products Marketing Act, which was passed in May, 1936, established the Primary Products Marketing Department. The preamble to the Act states that it is considered essential in the public interest that producers of primary products should, as far as possible, be protected from the effects of fluctuations in market prices, and the means adopted by the Government of affording such protection are stated as follows : — (a) The Government is empowered to acquire ownership of primary products at prices to be fixed from time to time. (b) In respect of primary products intended for consumption in New Zealand the Government is empowered in its discretion either to acquire the ownership of such products at fixed prices or to control the sale and distribution thereof. (c) The immediate inauguration of a plan to deal effectively with dairy-produce through the Primary Products Marketing Department, the principal functions of which are to make all necessary arrangements with respect to — (i) The acquisition, on behalf of the Crown, of any primary products in accordance with the Act: (ii) The marketing, in New Zealand or overseas, of primary products, whether or not such products have been acquired on behalf of the Crown. The Department commenced operations on Ist August, 1936. The officers and staff of the Dairy Produce Export Division in New Zealand and London have been appointed almost entirely from the staff of the New Zealand Dairy Board, which, prior to the setting-up of the Department, arranged for the export of dairy-produce, and for the allocation of such produce to agents in the United Kingdom for sale on behalf of dairy-factory companies. The present activities of the Department cover the acquisition of export butter and cheese and the marketing of such butter and cheese in the United Kingdom and elsewhere, and regulation of tlie sale and distribution of butter and other products within New Zealand. The acquisition and sale of export butter and cheese is conducted by the Dairy-produce Export Division of the Department, whilst the control and regulation of marketing within New Zealand is conducted by the Internal Marketing Division of the Department. The activities of the Internal Marketing Division are reviewed in a separate section of this report.

H,— 3o

The Department has its head office in Wellington, and branches in Auckland, New Plymouth, and Dunedin, and an agency at Lyttelton. The Department also has its own organization in London, known as the Dairy Sales Division. In accordance with the undertaking which was given to dairy-factory companies, all contracts made by them in respect of butter and cheese manufactured prior to Ist August, 1936, were completed. The Department undertook to arrange the shipping and marketing of the 1935-36 produce on behalf of dairy companies, and the last shipment was made per s.s. " Tamaroa "on 9th October, 1936. The first shipment of dairy-produce by the Department, in terms of the Primary Products Marketing Act, was per s.s. " Port Darwin " sailing on 29th August, 1936. ACQUISITION OF DAIRY-PRODUCE BY THE CROWN, AND GUARANTEED PURCHASE PRICES FIXED. All dairy-produce that is intended for export becomes the property of the Crown as soon as it is placed, with the concurrence of the Department, on board any ship for export from New Zealand. The prices fixed for all butter and cheese manufactured from milk or cream delivered to a dairy factory on and after Ist August, 1936, and exported from New Zealand on or before 3lst July, 1937, were based, in terms of the Act, on the prices received in New Zealand during a period of from eight to ten years prior to 31st July, 1935, for produce of the same kind. The average prices received for butter and cheese for periods of eight years, nine years, and ten years prior to 31st July, 1935, and the corresponding butterfat payouts are shown in the following table :—

In fixing the guaranteed purchase prices for the 1936-37 season on the basis of the prices received in New Zealand during the period of from eight to ten years prior to 31st July, 1935, the Government decided to pay prices which were in excess of the highest of the averages shown for the eight-year, the nine-year, and the ten-year period. The respective average butterfat payments for butter were — Per Pound. For eight years .. .. .. .. .. .. 12-lid. For nine years .. .. .. .. .. .. 12-37 d. For ten years .. .. .. .. .. .. 12-73 d. To ensure a pay-out fully equal to the best average period the Government decided to buy all butter for export at a basic price of per pound and cheese at a basic price of 6jfd. per pound. It was estimated that these prices would enable efficient dairy-factory companies to pay 13-04 d. per pound for butterfat for butter, and to provide for a premium of lfd. per pound for suppliers of butterfat for cheese-manufacture. The table shown above gives the average realizations for the periods mentioned, and shows the corresponding butterfat payments to suppliers to butter-manufacturing companies. An overallowance in the conversion formulas for costs of butter-manufacture resulted in a lesser differential (cheese over butter) than the l|d. promised. The table on page 34 of this report shows that the estimated New Zealand average payments for the 1936-37 season for butterfat are 13-529 d. per pound for butterfat for butter-manufacture, and 14-440 d. per pound for butterfat for cheese-manufacture. These figures reveal a differential of 0-911 d., which is 0-589 d. short of the promised l|d. The Government have noted this disparity, and a further payment will be made to cheese-manufacturing companies of |d. per pound on all cheese graded up to and including the 18th March, 1937, purchased by the Government and exported from New Zealand on or before 31st July, 1937. This further payment will enable cheese-manufacturing companies working under average conditions in respect of yield of cheese per pound of butterfat and costs of manufacture and delivery to overseas steamers to pay to their suppliers a price at least l|d. per pound in excess of the average price of 13-529 d. quoted for butterfat for butter-manufacture.

4

Purchase Prices of Produce. Corresponding Butterfat Pay-out. Average Period (Years). Creamery whey Creamery Ch-e Butter. Butter. Butter. B utter. whey s Butter). Shillings per Hundredweight. (F.o.b. Ocean Steamers.) Pence per Pound. 8 .. .. .. 109/4 56/6 99/4 12-11 12-66 0-55 13-21 9 .. .. .. 111/2 57/1 101/2 12-37 12-83 0-56 13-39 10 .. .. .. 114/0 58/6 104/0 12-73 13-23 0-58 13-81

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PRICES 1937/38 SEASON. The prices fixed for all butter and cheese exported after the 31st July, 1937, and which is manufactured from milk or cream delivered to a dairy factory on or before the 31st July, 1938, were based on the formula set out in section 20 of the Primary Products Marketing Act, the appropriate subsections being as follows : — (4) In fixing prices under this section in respect of dairy-produce exported after the thirty-first day of July, nineteen hundred and thirty-seven, regard shall be had to the prices fixed under this section in respect of dairy-produce exported before that date, and to the following additional considerations, namely : — (a) The necessity in the public interest of maintaining the stability and efficiency of the dairy industry : (b) The costs involved in the efficient production of dairy-produce : (c) The general standard of living of persons engaged in the dairy industry in comparison with the general standard of living throughout New Zealand : (d) The estimated cost to the Department of marketing the dairy-produce concerned, and also the cost of the general administration of this Act: (e) Any other matters deemed to be relevant. (5) Due regard having been paid to the several matters mentioned in subsection four hereof the prices fixed in respect of any dairy-produce exported after the thirty-first day of July, nineteen hundred and thirty-seven, shall be such that any efficient producer engaged in the dairy industry under usual conditions and in normal circumstances should be assured of a sufficient net return from his business to enable him to maintain himself and his family in a reasonable state of comfort. The guaranteed price had to be such as would maintain both the stability and the efficiency of the dairy industry ; both could be destroyed by a price that is either too high or too low. Some 21,500 return forms were sent to farmers under the direction of the Government Statistician. Based on 19,307 full and complete returns sent in by farmers the following information was derived : Variation in size of herds, average butterfat-yield per cow and per acre, the dairy-farm population, the incidence of employment on dairy-farms under the headings of male and female family labour and hired labour, and the distribution of male labour according to size of herd. This was the first comprehensive view ever obtained of the New Zealand dairy industry. A more detailed and intensive investigation was made of dairy-farms by the Department of Agriculture from the point of view of cost analysis ; 75 per cent, of these consisted of farms investigated by the Department on behalf of the Dairy Industry Commission, 1934. The information supplemented and confirmed the broader survey of the Government Statistician. A detailed analysis was also made of dairy-factory costs. A production per acre of from 100 lb. to 175 lb. of butterfat was regarded as the standard which could readily be realized by an efficient producer operating under usual conditions and in normal circumstances. On the basis of using adult male labour, 12,500 lb. of butterfat was taken as the labour standard of efficiency for two units. Per cow efficiency was taken at 258 lb. of butterfat, and capitalization (including unimproved value, improvements, and stock and chattels) at £73 a cow. The standard rate of interest applied to determine total interest charges was 4J per cent. The standard allowance for working and maintenance costs was 5 - 07 d. per pound of butterfat. The full statement of working and maintenance costs in shown on page 6. The detailed figures of working and maintenance costs are as follows:— Working and Maintenance Costs Pee Pound of Butterfat : Mean Smoothed Data for Three Fat Groups (100-125, 125-150, and 150-175 lb. Butterfat Per Acre). Butter. Cheese, d. d. 1. Cultivation and harvesting (special costs) .. .. .. .. 0-228 0-172 2. Grass and other seeds .. .. .. .. .. .. 0-132 0-152 3. Fertilizer and lime .. .. .. .. .. .. 1-107 1-171 4. Fencing repairs and renewals .. .. .. .. .. 0-223 0-202 5. Water-supply (repairs and maintenance) .. .. .. .. 0-069 0-066 6. Drainage (repairs and maintenance) .. .. ~ .. 0-040 0-038 7. Noxious-weeds control .. .. .. .. .. .. 0-025 0-061 8. Rabbit control (poison and Board rates) .. .. .. .. 0-003 0-002 9. Casual labour (items 2to 8) .. . . . . . . . . 0-094 0-071 10. Cow-covers used (repairs and replacements) .. .. .. .. 0-044 0-040 11. Veterinary expenses for cows and pigs only . . . . . . 0-064 0-061 12. Implements, &c. : Repairs and spare parts .. .. .. .. 0-109 0-106 13. Horse expenses .. .. .. .. .. .. .. 0-052 0-106 14. Tractor and/or truck expenses .. .. .. .. ..0-079 0-040 15. Farm-building expenses .. .. .. .. .. .. 0-129 0-121 16. Milking-plant repairs .. .. .. .. .. .. 0-124 0-106 17. Milking-shed power and heating .. .. .. .. .. 0-326 0-293 18. Milking-shed materials used .. .. .. .. .. 0-069 0-065 19. Main working-expenses (items Ito 18) .. .. .. .. 2-917 2-873

5

H.—3o.

Butter. Cheese. Depreciation— d. 20. Implements, &o. .. .. .. .. .. .. 0-267 0-257 21. Farm buildings .. .. .. .. .. .. 0-183 0-167 22. Milking plant .. .. .. .. .. .. 0-247 0-197 23. Horse .. .. .. .. .. ... .. 0-129 0-146 24. Tractor and/or truck .. .. .. .. .. .. 0-139 0-071 25. Total depreciation (items 20 to 24) .. .. .. .. 0-965 0-838 26. Insurance (labour and fire, &c. (excluding house)) .. .. .. 0-059 0-061 27. Telephone .. .. .. .. .. .. .. 0-069 0-070 28. Rural delivery .. .. .. .. .. . „ .. 0-008 0-007 29. Subscription to farmers' organizations .. .. .. .. 0-020 0-020 30. Accounting-expenses .. .. .. .. .. 0-016 0-016 31. Truck and/or car registration, and drivers license .. .. .. 0-051 0-061 32. Car expenses (for farm use only) .. .. .. .. .. 0-188 0-177 33. Other sundries .. .. .. .. .. .. .. 0-030 0-030 34. Herd-testing and calf-marking . . . . . . . . . , 0-079 0-061 35. Rates .. .. .. .. .. .. .. .. 0-376 0-424 36. Land-tax.. .. .. .. .. .. .. .. 0-014 0-016 37. Sundry overhead expenses. (items 26 to 36) .. .. .. .. 0-910 0-943 38. Cow and pig food, &c., purchased .. .. .. .. .. 0-277 0-273 Main-working-expenses (items 1 to 18) .. .. .. .. 2-917 2-873 Total depreciation (items 20 to 24) .. .. .. .. 0-965 0-838 Sundry overhead expenses (items 26 to 36) .. .. .. 0-910 0-943 Cow and pig food, &c., purchased (item 38) .. .. .. 0-277 0-273 Total working and maintenance expenses .. .. .. 5-069 4-927 Note.—To the total working and maintenance cost per pound of.butterfat for farms supplying cheese-factories, approximately 0-14 d. per pound of butterfat should be added, being the assessed farm portion relating to costs of milk-delivery to factory not elsewhere shown. The standard for pig returns was l-54d. per pound of butterfat. This figure is probably below the average of efficient farmers as the Dominion average was taken ; this average includes farms where no pigs are kept and farms supplying casein-factories. In all other cases the standards were worked out on the investigations made and the information obtained. In considering the figure for pigs it should also be noted that the figure for dairy-farm working and maintenance costs includes (a) purchased pigfoods, medicines, &c., and (b) depreciation on piggeries, and in the allowance for cow capitalization there is provision for the investment on pigs and pig equipment. The allowance for factory-costs and all other costs to f.o.b. ocean steamer was for butter 2-25 d. per pound of butterfat and for cheese 3-25 d. per pound of butterfat. In the overrun of 21-75 per cent, and the cheese-yield of 2-45 lb. there is a margin in favour of reasonably efficient factories working under average conditions. The allowance on a two-unit farm for housing and other perquisites was 30s. a week, and labour reward for the farmer at £4 a week. The history of the dairy industry shows clearly that high prices do not necessarily promote the stability of the industry, because of the tendency to capitalize the benefits in inflated land and stock values. The guaranteed price should not be such as will induce persons to capitalize its benefits, especially as the trend of land and stock prices in 1936-37 was of a hardening nature. The standards of efficiency are greatly exceeded by the more efficient dairy-farmers of New Zealand, and the allowances for working and maintenance costs are on such a scale that, if they are expended for the purposes specified, only an inefficient farmer, or a farmer working under unusual conditions or in abnormal circumstances, could fail to attain the average of the per-cow per-acre and per-man standards mentioned. _ Any excess of efficiency above these standards and any increase in pig returns represents an additional return to the efficient farmer. And it must be remembered that an efficient farmer in usual circumstances and in normal conditions is fully protected from the vicissitudes of the external market. With the allowances for labour there is no justification for any unpaid or sweated labour to be utilized on any efficient dairy-farm in New Zealand, and if there is any unpaid labour employed the farmer is increasing his own personal income. It should, of course, be stressed that there is nothing essentially reprehensible in the utilization, within reasonable limits, of family labour. By the adoption of 6,250 lb. of butterfat as the production of a full-time labour unit a reasonable payment is provided for all labour units employed, whether male or female labour, members of the family, or employees. The data collected show that approximately only 20 per cent, of the labour employed in the industry is hired labour. The new procedure has been organized for the purpose of inducing the average efficient farmer to work his holding and to pay him for his knowledge and experience, and for time worked, whilst freeing him from the menace of price-fluctuations.

6

H.—3o.

The full range of f.o.b. purchase prices fixed for the 1936-37 season and the 1937-38 season is as follows: —

It is to be noted that in the case of butter the basic f.o.b. purchase price is increased by 0-6875 d. (•&d.) per pound, the comparative figures being— 12-5625 d. (I2 j 9 g-d.) per pound for the 1936-37 season. 13-25 d. (13id.) per pound for the 1937-38 season. In the case of cheese the basic f.o.b. purchase price is increased by 0-7275 d. per pound, the comparative figures being— 6-8125 d. per pound for the 1936-37 season. 7 • 54d. per pound for the 1937-38 season. The prices fixed for the 1937-38 season for whey butter have the same relation to the prices of creamery butter as was the case in respect of the 1936-37 season. The premiums fixed for the 1937-38 season to cover the additional costs of manufacture of coloured and waxed cheese are the same as those which applied for the 1936-37 season, but the premium fixed for the 1937-38 season for the manufacture of unsalted butter is raised to 3s. 4d. per hundredweight. These premiums apply to butter and cheese of the type mentioned, and which is manufactured and packed at the request of the Department. The conversion formulae used in the determination of the 1937-38 season prices shown above are — Butter. Cheese. Over-run.. .. •• 21-75 per cent. Yield .. .. .. 2-51 gross, 245 Costs of manufacture and\2-25d. per pound net. delivery to f.o.b. J butterfat. Return from whey butter .. 0-66 d. per pound butterfat. Costs of manufacture and\3-25d. per pound delivery to f.o.b. f butterfat.

7

1936-37 Season. 1937-38 Season. Butter and Cheese manufactured on Butter and Cheese exported after Grade. and after 1st August, 1936, and 31st July, 1937, and which is exported on or before 31st July, manufactured on or before 31st 1937. July,. 1938. Creamery Butter. Creamery Butter. Finest Grade — Per Lb. Per Cwt. Per Lb. Per Cwt. 94 points and over .. .. 12-6875d. 118/5 13-375d. 124/10 93 to 93£ points .. .. 12-5625d. 117/3* 13-25d. 123/8* * (Equivalent to 106/6 sterling * (Equivalent to 112/- sterling per cwt. on London market.) per cwt. on London market.) First Grade — 92 to 92| points .. .. 12-5d. 116/8 13-1875d. 123/1 90 to 91| points .. .. 12-3125d. 114/11 13-00d. 121/4 Second Grade .. .. ll-8125d. 110/3 12-50d. 116/8 Whey Butter. Whey Butter. First Grade .. .. ll-5625d. 107/11 i 12-25d. 114/4 Second Grade .. .. ll-0625d. 103/3 | ll-75d. 109/8 Cheese. Cheese. Finest Grade — 94 points and over .. .. 6-96875d. 65/0f 7-69625d. 71/10 93 to 93£ points .. .. 6-9375d. 64/9 7-665d. 71/6£ First Grade — 92 to 92| points .. .. 6-8125d. 63/7* 7-54d. 70/4£* * (Equivalent to 61/3 sterling * (Equivalent to 67/- sterling per cwt. on London market.) per cwt. on London market.) 91 to 91 \ points .. .. 6-75d. 63/- 7-4775d. 69/9| Second Grade .. .. 6-5625d. 61/3 7-29d. 68/0| Premiums. Premiums. Unsalted butter .. .. 2/4 per cwt. 3/4 per cwt. Coloured cheese . . .. 6d. per crate 6d. per crate. Deep-coloured cheese .. . . 1/5 per crate 1/5 per crate. Waxed cheese .. .. 4fd. per crate 4|d. per crate. Deductions. Deductions. Butter per Box. Cheese per Crate. Butter per Box. Cheese per Crate. Insurance to f.o.b. .. .. 0-68d. l-07d. 0-69d. l-085d. Dairy Board levy .. .. l-12d. l-63d. 0-56d. 0-815d. * Basic price.

H,— 3o,

On the basis of the basic guaranteed price of 13fd. per pound, and on the conversion formula mentioned above, the butterfat payment made to suppliers by butter-manufacturing companies, working under average conditions, should be 13-88 d. per pound. This price is represented by farm costs and allowances as follows Price per Pound Butterfat. Farm working and maintenance costs .. .. .. .. 5-07 d. Allowance for interest on capital .. . .. .. .. 3-06 d. Labour on farm .. . . . . . . . . . 7 ■ 29d. 15-42 d. Less return from pigs.. .. .. . . . . .. l-54d. 13-88 d. In order to cover the difference in costs of production and in returns from by-products in the case of butterfat for cheese, the purchase prices of cheese are so fixed that the average efficient cheesemanufacturing company will pay out to its suppliers on the basis of the basic guaranteed price of 7-54 d. per pound, and on the conversion formula mentioned above, 2d. per pound butterfat over the payout for butter, or 15-88 d. per pound. PREMIUMS FOR QUALITY. It will be noted that the basic purchase prices are subject to additions and deductions according to the quality of the butter and cheese as disclosed by the grade points awarded by the Government graders. The incentive thus given to maintain and improve the quality of dairy-produce has been appreciated by representatives of dairy-factory companies, and a definite improvement has resulted, as revealed by the following comparative grading figures:—

Grading of Dairy-produce: Percentages of New Zealand Butter and Cheese of the Various Grades.

The quantities of butter and cheese purchased and paid for at the respective differential prices are shown in the following tabulations : —

Creamery Butter (in Tons): Quantities purchased and paid for at Differential Prices.

8

Butter. Cheese. Finest. First. Second. Total. Finest. First. Second. Total. Per Cent. Per Cent. Per Cent. Per Cent. Per Cent. Per Cent. Per Cent. Per Cent. 1932-33 .. .'. 79-32 19-74 0-94 100-00 17-29 80-5 2-21 100-00 1933-34 .. .. 78-00 20-75 1-25 100-00 26-04 72-06 1-90 100-00 1934-35 .. .. 77-04 21-66 1-30 100-00 20-60 76-27 3-13 100-00 1935-36 .. .. 76-48 22-36 1-16 100-00 19-47 77-18 3-35 100-00 1936-37 .. .. 79-98 19-12 0-90 100-00 20-58 76-81 2-61 100-00

Finest Grade. First Grade. Grading Ports. Total. q , q „, 94 Points p " t 92 to 92J 90 to 91J Grade. and over. Points. Points. (.Basic i riee.) Tons. Tons. Tons. Tons. Tons. Tons. Auckland .. .. .. 105,086 25,504 56,430 12,369 10,481 302 Bluff .. ,. .. 616 4 147 196 171 98 Dunedin .. .. . . 735 133 495 62 25 20 Gisbome .. .. .. 2,909 1,699 965 216 29 Lyttelton .. .. .. 3,161 2,067 967 80 8 39 Napier .. .. .. 3,255 2,370 556 65 264 New Plymouth .. .. 11,111 6,564 3,179 909 458 1 Patea .. .. .. 2,180 278 861 517 519 5 Timarn .. .. .. 367 40 252 38 9 28 Wanganui .. .. .. 3,391 2,597 608 129 53 4 Wellington .. .. .. 16,999 12,588 2,257 969 1,175 10 Grand totals .. .. 149,810 53,844 66,717 15,550 13,192 507 Percentage of qualities . . 100 35-94 44-53 10-88 8-81 0-34

EL—3O,

Whey Butter (in Tons): Quantities purchased and paid for at Differential Prices.

Cheese (in Tons): Quantities purchased and paid for at Differential Prices.

It will be noted that in tlie case of creamery butter 44§ per cent, was paid for at the basic guaranteed price, and 36 per cent, above and 191 per cent, below the basic guaranteed price. In the case of cheese 55 J per cent, was paid for at the basic guaranteed price, and 20J per cent, above and 24 per cent, below the basic guaranteed price. PROCESSES IN PURCHASE OF BUTTER AND CHEESE AND SHIPMENT AND DELIVERY TO MARKETS IN THE UNITED KINGDOM. The procedure adopted by the Department in regard to the purchase and sale of dairy-produce is as follows :— 1. Dairy factory companies forward butter and cheese to the cool stores for export as in the past. The care of the produce in cool store is the responsibility of dairy companies, but supervision is exercised by the expert officers of this Department and by the Government Dairy-produce Graders, with a view to the preservation of the quality of butter and cheese.

2—H. 30.

9

Grading Ports. Total. First Grade. Second Grade. Tons. Tons. Tons. ' Auckland .. .. .. 363 202 161 Bluff .. .. .. .. 30 29 1 New Plymouth .. .. .. 343 332 11 Patea .. .. .. .. 589 577 12 Wellington .. .. .. .121 109 12 Grand totals .. .. .. 1,446 1,249 197 Percentage of qualities . . . . 100 86 -38 13 • 62

Finest Grade. First Grade. Grading Ports. Total. no , nol Second 94 Points 93 to 931 p ° t 91 to 911 Grade. and over. Points. . 01 ?, s .' , Points. (Basic Price.) Tons. Tons. Tons. Tons. Tons. Tons. Auckland .. .. .. 15,178 74 1,053 8,637 4,200 1,214 Blufl .. .. .. 11,508 296 2,532 5,303 3,131 246 Dunedin .. .. .. 1,960 163 595 923 267 12 Gisborne 82 .. 5 51 25 1 Lyttelton .. .. .. 1,022 65 370 529 46 12 Napier .. . . . . 110 . . 57 44 9 New Plymouth. .. .. 16,798 539 5,575 7,961 2,626 97 Patea .. .. .. 22,111 191 3,074 14,209 4,333 304 Timaru .. .. .. 618 .. 88 498 29 3 Wanganui .. .. .. 2,477 346 401 1,349 336 45 Wellington .. .. 14,844 405 2,018 8,541 3,559 321 Grand totals .. .. 86,708 2,079 15,768 48,045 18,561 2,255 Percentage of qualities .. 100 2-40 18-18 55-41 21-41 2-60 Waxed .. .. .. 58-54 Coloured .. .. 32-69 Cheese figures calculated at fourteen crates, to a ton.

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2. Dairy factory companies may obtain advances from their bankers on produce in cool store awaiting shipment, at the banks' best interest-rates. The amounts advanced by the banks are as follow : — _ Per Box. Creamery Butter. £ g Finest grade .. .. .. .. .. .. ..306 First grade .. .. .. .. .. .. .. 219 4 Second grade .. .. . . .. .. .. .. 215 0 Cheese. Per Crate. North Island — £ B . a. Finest grade .. .. .. .. .. .. .. 419 6 First grade .. .. .. .. .. .. .. 417 0 Second grade .. .. .. .. .. .. .. 414 6 South Island—• Finest grade .. .. .. ... .. .. 4 17 6 First grade .. .. .. .. .. .. .. 415 0 Second grade .. . . . . . . .. . . .. 412 6 3. Butter and cheese for export is allocated for shipment in accordance with the recommendations of the Dairy Sales Division in London, after consultation with the selling-agents. The shipping programme is worked out by the Department and the Overseas Ship-owners' Allotment Committee, which meets regularly for the purpose of planning arrivals of butter and cheese at United Kingdom ports, in accordance with the agreed programme. Under the present system the Department has been able to arrange a better programme of shipments to United Kingdom outports. 4. Dairy-produce becomes the property of the Crown as soon as it is placed on board any ship for export, and payment in full to dairy-factory companies is made forthwith. Credit-notes are issued in favour of dairy companies for butter and cheese, and the amount due is remitted to the credit of the bank accounts of the individual companies, under a special arrangement entered into with the trading banks. 5. All butter and cheese for export to the United Kingdom is shipped to the Dairy Sales Division, for sale on consignment. Delivery orders are issued to merchant agents enabling them to obtain the quantities allocated to them for sale. 6. The financing of payments to dairy-factory companies for butter and cheese is arranged through the Dairy Industry Account established at the Reserve Bank of New Zealand. The administrative, marketing, shipping, insurance, and other expenses of the Department are paid from this account. The proceeds of sale of dairy-produce are paid into the account, the final balance of which will show the surplus or deficit on the operations for the year. 7. The sale of butter and cheese in the United Kingdom is conducted by a group of twenty merchant firms appointed as agents for the Department. These merchant firms sell on agency terms for a commission of 2 per cent., which includes the credit risk. The agents are firms which have been selling the produce for years under the marketing system in operation before the passing of the Primary Products Marketing Act. Provisional allocations of produce are made to the agents for a period of one year, and quantities are reviewed and varied according to the selling ability of the firms as indicated by price returns and marketing and distributive service rendered. QUANTITIES OF BUTTER AND CHEESE GRADED. For the twelve months ended 31st July, 1937, the total gradings of butter and cheese compared with 1935-36 were as follows : — Butter (in Tons). 1936-37. 1935-36. Salted .. .. .. ..147,168 139,973 Unsalted .. .. .. .. 7,396 6,714 154,564 146,687 Cheese (in Tons). White .. .. .. .. 59,337 58,263 Coloured .. .. .. .. 28,885 27,292 88,222 85,555 Butter gradings for the 1936-37 season show an increase of 5'37 per cent, and cheese gradings an increase of 3'12 per cent. Expressed in terms of butterfat the total increase in gradings is 4-889 per cent. QUANTITIES OF BUTTER AND CHEESE EXPORTED. The quantities of butter and cheese exported from the various grading ports of the Dominion are shown in the following tabulation :—

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Butter and Cheese Exports from 1st August, 1936, to 31st July, 1937.

MARKETING OF BUTTER AND CHEESE. The following review covers the developments during recent years in the marketing of dairy-produce, and outlines the essential features of the system which the Marketing Department operates through the Dairy Sales Division. The methods of sale of New Zealand dairy-produce in the United Kingdom have changed substantially during the post-war period. As the dairy industry increased in importance in New Zealand, and the exports of butter and cheese accounted for an increasingly greater proportion of the national income, certain sections of producers became aware of the necessity of taking a greater interest in the marketing of their produce. Even in pre-war days the National Dairy Association of New Zealand had established an office in London, one of its functions being to establish contact with the Tooley Street merchants who were selling New Zealand dairy-produce. In 1921 the New Zealand Co-operative Dairy Co., Ltd., opened an office in London to supervise sales of the company's butter and cheese by its appointed agents, and in that year also the New Zealand Produce Association came into being with a selling-floor in Tooley Street. Finally, in October, 1927, the New Zealand Co-operative Dairy Co., Ltd., formed a new marketing company —Amalgamated Dairies, Ltd. —which eventually disposed of the whole of the output of the New Zealand Co-operative Dairy Co., Ltd., coming to the United Kingdom. An associated company —Empire Dairies, Ltd. — is used to a great extent by Amalgamated Dairies as the selling-medium, and this associated company also sells substantial quantities of dairy-produce from Australia and other Empire countries. These organizations, of course, represented only a certain section of New Zealand producers, and the rapid fluctuations in prices which occurred in the early years of the post-war period brought about a demand from the leaders of the dairy industry for a greater degree of co-ordination in the methods of sale. As a result, the New Zealand Dairy-produce Control Board came into being in 1924, the Board being established in terms of the Dairy-produce Export Control Act, 1923. In the first two years of its existence the Board confined its activities to arranging contracts for the sea carriage of butter and cheese from New Zealand, marine insurance, regulation of shipments, advertising in the United Kingdom, and investigation of marketing procedure. In 1926, however, the Board took full control of marketing, but the venture was abandoned after less than one year's trial. The Board's control scheme revealed the difficulty of getting within the industry a sufficient measure of unanimity to enable a major proposal to be successfully carried out. After the abandonment of the control scheme, and until 1933, the Board confined its activities to shipping, insurance, and advertising, the dairy-factory companies being left free to sell through or to consign for sale to whom they chose. The disastrous fall in prices which commenced in 1929 and continued in the succeeding years, and the rapid increase in production which added to the difficulties of marketing at this time, again brought into question the existing system of uncontrolled methods of sale, and in 1933 the Dairy Board again assumed a greater degree of control. Dairy companies were still permitted to sell f.o.b. or to consign as they thought fit, but the Board took over the allocation of factory outputs to the various sellingagents in the United Kingdom, who undertook that they would not speculate in New Zealand dairy-produce on their own account. This system did not work very satisfactorily, because it was generally recognized that the Board, not being the owner of the produce, was not in a position satisfactorily to enforce the letter and the spirit of the undertaking. In 1935 the Board, with the approval of the industry, decided to introduce a group-marketing system under which it was hoped that dairy-factory companies in suitable geographical areas in New Zealand would, in time, form co-operative selling organizations under the direction of the Board.

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To Great Britain. To &^. and Destinartons. TotaI Ex P Mts - Percentage. Grading Ports. —— -—' " Butter. Cheese. Butter. Cheese. Butter Cheese. Batter. Cheese. Butter. Cheese. Boxes. Crates. Boxes. Crates, j Boxes. Crates. Boxes. Crates. Auckland .. 4,020,656 205,491 36,851 1,229 76,546 873 4,134,053 207,593 69-35 17-41 New Plymouth .. 432,142 235,720 .. .. •• •• 432,142 235,720 7-25 19-76 Patea .. .. 102,234 309,334 .. .. .. .. 102,234 309,334 1-71 25-94 Wanganui .. 136,382 33,572 .. .. .. •• 136,382 33,572 2-29 2*81 Wellington .. 669,422 204,880 3,450 4 8,753 82 681,625 204,966 11-44 17-19 Gisborne .. 128,663 1,160 .. .. .. .. 128,663 1,160 2-16 0-10 Napier .. .. 137,515 1,540 137,515 1,540 2-30 0-13 North Island totals 5,627,014 991,697 40,301 1,233 85,299 955 5,752,614 993,885 96-50 83-34 Lyttelton .. 130,760 13,214 1,000 .. 150 .. 131,910 13,214 2-21 1-11 Timaru .. .. 16,709 8,523 16,709 8,523 0-28 0-72 Dunedin.. .. 32,956 29,509 88 32,956 29,597 0-56 2-48 Bluff .. .. 26,806 147,058 .. .. .. 244 26,806 147,302 0-4-5 12-35 South Island totals 207,231 198,304 1,000 .. 150 322 208,381 198,636 3-50 16-66 Dominion totals.. 5,834,245 1,190,001 41,301 1,233 85,449 1,287 5,960,995 1,192,521 100-00 100-00

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MARKETING OF NEW ZEALAND BUTTER IN THE UNITED KINGDOM. Quantities (in Tons) sold Weekly, with Average London Prices (per Hundredweight Sterling), 5th November, 1936, to 31st July, 1937.

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MARKETING OF NEW ZEALAND CHEESE IN THE UNITED KINGDOM. Quantities (in Crates) sold Weekly, with Average London Prices (per Hundredweight Sterling), 19th November, 1936, to 31st July, 1937.

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The decision of the Government to purchase the total exportable output of butter and cheese from the Ist August, 1936, transferred all responsibility for marketing from the industry to the Government. For the first time in the history of the industry a single authority could make decisions in the broader interests of the industry as a whole. An industry viewpoint superseded the narrower and shorter-term viewpoint, and the marketing advantages of organized regulation became a reality under the system inaugurated by the Government. The desire of the Department is that a system of shipment and marketing of our dairy-produce should be developed which will ensure regular arrivals of butter and cheese of uniformly high quality, in fresh condition, delivered at the main distributing ports in the United Kingdom in quantities to meet the market requirements, and the sale of this produce on a consignment basis through accredited agencies with distributive outlets at a minimum cost to the producer and consumer. MARKETING IN THE UNITE!) KINGDOM. No drastic changes in the channels of distribution of New Zealand butter and cheese in the United Kingdom have been introduced during the season just closed. The services of those companies which, in the past, acted as selling-agents for New Zealand dairy companies were freely offered to the Primary Products Marketing Department, and the well-established organization of the New Zealand Dairy Board in the United Kingdom was transferred en bloc to the Department. Single ownership of consignments by the Government has been substituted for multiple ownership by producing factories, but pre-existing channels of distribution, and the machinery of supervision and control, have been substantially improved. In recent years, prior to the inception of Government purchase, New Zealand butter and cheese shipped to the United Kingdom have been either forwarded on consignment for sale to best advantage on arrival or sold on f.o.b. or c.i.f. terms. Some twenty-eight importing houses received consignments for sale on agency terms. Some of these houses also operated on c.i.f. terms, either on their own account or for the account of third parties. In addition, certain brokers made sales, more or less intermittently, on f.o.b. and c.i.f. terms. From these organizations the Primary Products Marketing Department selected twenty-two importing houses to act as their selling-agents, the objectives being— (a) To secure the services of sales organizations which would provide the maximum regular distribution of New Zealand butter and cheese to wholesale, retail, and manufacturing interests throughout the United Kingdom : (b) To retain those importing houses which were most likely to co-operate with the Department and with their fellow-agents in order to eliminate unregulated selling competition : (c) To create a minimum of disturbance in existing distributive methods. So far as the 1936-37 season is concerned, these objectives have been adequately fulfilled. Agents are no longer under the necessity of maintaining expensive organizations in New Zealand in order to retain and increase their business with individual dairy-factory companies, the elimination of that expense through the inauguration of the present system is reflected in a reduction in the rate of sellingcommission by \ per cent., equal to approximately £100,000 sterling on the season's output. The method of dealing with agents is as follows :— At the commencement of the season each agent is advised of the approximate total quantity of butter and cheese allotted to him for the year, and the brands of which that quantity is made up. As soon as possible after the despatch of each shipment from New Zealand, agents receive notification of the quantity and brands of their portion of the consignment. On arrival of the carrying-vessel at its destination the produce is placed at agents' disposal by means of delivery orders issued when the vessel commences to discharge. After sales have been made settlement is effected in a manner convenient to all parties, having regard to the customs of trade ; no advances are expected or payments made until after the produce, has been sold. The Department receives comprehensive daily returns of all sales made. In addition, constant personal touch is maintained with each agent, and, in consequence, those entrusted with the disposal of our produce are able readily to obtain accurate information relating to sales, prices, stocks, and arrivals, which enables them to adjust their offerings so that, while goods are always available to meet buyers' requirements, there is an absence of undue sales pressure during periods of quiet demand. OUTLETS FOR BUTTER AND CHEESE AND EXTENSIONS WHICH HAVE BEEN MADE. West Coast Shipments. The quantity of butter and cheese shipped to the West Coast United Kingdom ports continues to increase, and during the season under review all the major outports will have received larger quantities than in the previous year. The increase of butter export was entirely absorbed by the outports, while in the case of cheese the outport requirements necessitated a reduction of the total shipped to London. Shipments to Hull were resumed this season, and initial shipments made to Newcastle ; it is hoped to increase the quantities to these ports and to provide a regular service that will enable steady development to be made. An interesting comparison of the tonnage of butter and cheese received at United Kingdom porta during recent years is shown in the following tabulations : —

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Arrivals of New Zealand Butter in United Kingdom Ports (in Tons).

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Port. 1932-33. 1933-34. 1934-35. ! 1935-36. (Pl^mme .) London- — New Zealand .. 93,730 102,147 98,276 105,143 106,066 Other sources .. 136,030 158,323 159,884 149,157 Total .. .. 229,760 260,470 258,160 254,300 Southampton — New Zealand .. 394 815 1,570 Other sources .. 2,370 1,490 4,336 8,185 Total .. .. 2,370 1,490 4,730 9,000 Avonmouth- — New Zealand . . 7,495 8,096 _ 7,311 7,166 10,608 Other sources .. 245 814 589 554 Total .. .. 7,740 8,910 7,900 7,720 Cardiff — New Zealand .. 218 413 787 555 217 Other sources .. 22 .. 293 325 Total .. .. 240 413 1,080 880 Liverpool New Zealand .. 6,585 6,572 6,778 7,342 8,001 Other sources (Liverpool 7,662 8,702 14,664 14,604 and Manchester) ; Total .. .. 22,440 25,650 29,950 31,240 Manchester — New Zealand .. 8,193 10,376 8,508 9,294 10,705 Glasgow — New Zealand .. 6,524 8,380 6,79-3 8,081 9,050 Other sources .. 5,076 5,560 10,127 8,069 Total .. .. 11,600 13,940 16,920 16,150 Newcastle — New Zealand .. .. . • • • • • 37* Other sources .. 30,440 31,050 25,730 25,540 Total .. .. 30,440 31,050 25,730 25,540 HullNew Zealand .. . . 116 146 .. 75* Other sources .. 23,620 28,994 26,724 28,140 Total .. .. 23,620 29,110 26,870 28,140 * Arrived.

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BUTTER. Map showing Annual Imports into United Kingdom Ports, 1st October, 1932, to 30th September, 1937.

Note. —Totals from weekly Customs and Excise returns. Customs returns of total arrivals at Manchester are not comparable with New Zealand figures from London office of the "Department.

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Arrivals of New Zealand Cheese in United Kingdom Ports (in Tons).

3—H. 30.

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Port. 1932-33. 1933-34. 1934-35. 1935-36. 1936-37. I (rrogramme.) London — New Zealand .. 80,564 79,982 69,333 66,407 62,906 Other sources .. .. 24,043 28,192 21,493 Total .. .. n.a. 104,025 97,525 87,900 Southampton — New Zealand .. .. .. 165 306 772 Other sources . . . . • • 485 1,024 Total .. .. 820 180 650 1,330 Avonmouth — New Zealand .. 5,586 6,278 6,137 5,494- 7,228 Other sources .. 1,774 2,442 2,563 1,776 Total .. .. 7,360 8,720 8,700 7,270 Cardiff — New Zealand . . 160 288 474 519 150 Other sources .. 1,260 752 1,076 871 Total .. .. 1,420 1,040 1,550 1,390 Liverpool — New Zealand .. 4,531 5,057 4,315 3,555 5,125 Other sources (Liverpool 3,659 2,295 3,663 3,141 and Manchester) — Total .. .. 13,650 12,630 12,350 10,660 T\/[ ' New Zealand .. 5,460 5,278 4,372 3,964 5,087 Glasgow — New Zealand .. 5,209 5,150 4,167 3,776 5,282 Other sources .. 1,731 1,705 813 909 Total .. -.. 6,940 6,855 4,980 4,685 Newcastle — New Zealand .. • ■ • • • • • • 51 Other sources . . • • 1,380 1,335 1,425 Total .. .. n.a. 1,380 1,335 1,425 HullNew Zealand .. .. 40 88 .. 58 Other sources .. .. 960 1,592 1,080 Total .. .. n.a. 1,000 1,680 1,080 Note. —New Zealand figures calculated at fourteen crates to a ton. N.a. means not available

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CHEESE. Map showing Annual Imports into United Kingdom Ports, 1st November, 1932, to 31st October, 1937. (Tons.)

Note. —Totals from weekly Customs and Excise returns. New Zealand figures from New Zealand Dairy Sales Division converted from crates at fourteen crates to ton. Customs returns of total arrivals at Manchester are not comparable with New Zealand figures from London office of the Department.

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REACTION OF TRADE TO NEW MARKETING SYSTEM. The new marketing-system has been favourably received by the trade as a whole. Buyers, with the exception of those who were accustomed to operate from time to time on c.i.f. or f.o.b. terms, appreciate the change, as the produce is offered to them freely through their usual channels of supply. All reports from our agents indicate their satisfaction, and confirm the opinion that the goodwill of New Zealand stands very high in all overseas distributive circles. EFFECT OF ELIMINATION OF F. 0.8. SELLING ON MARKETING AND MARKET PRICES. The sales methods of the Department are based upon " landed terms "—that is to say, no goods are sold before the commencement of discharge from the carrying-vessel at the port of destination in Great Britain. In previous years certain quantities were sold by dairy companies on c.i.f. or f.o.b. terms. Such sales varied in volume from year to year. In the past eight years the proportion thus sold varied from 15 per cent, to 34 per cent, for butter, and from 5 per cent, to 28 per cent, for cheese. A substantial proportion of f.o.b. or c.i.f. sales were bought on a purely speculative basis —that is, the purchaser bought in the belief that on arrival the goods could be resold at a profit on the purchase price. In the majority of such cases the goods were resold through Tooley Street importers or brokers in competition with current arrivals of consignment goods, and not infrequently to the detriment of consignment sales. Regular business between consignment agents and their wholesale and retail customers was often disturbed under those conditions, and the elimination of that interruption is the subject of favourable comment by many of our agents. F.o.b. and c.i.f. sales to wholesale and retail distributors and to manufacturers are in a somewhat different category. Goods sold to such buyers, do not, as a rule, " come back on the market," but are used for the regular trade of the purchaser. In this connection it should be noted that the proportion of Australian butter shipped to the United Kingdom, sold on f.o.b. or c.i.f. terms, has fallen substantially in recent years, as the following figures show : —

As Continental descriptions are not usually sold forward for delivery any length of time ahead there is no evidence that in the year under review business has been lost by New Zealand to Australia or to any other competitor because of the absence of forward sales. On the other hand, the sale of our consignments has been facilitated. GENERAL POSITION OF OUR BUTTER AND CHEESE ON THE MARKET COMPARED WITH OTHER COUNTRIES. It is extremely difficult to review over a short period the variations in price-levels as between the different classes of butter being sold in the United Kingdom markets. Frequently factors not immediately apparent to the casual observer temporarily influence prices and provoke illogical reasoning and deductions. Viewing this question from the New Zealand produce standpoint, the results over the season must be considered satisfactory. In comparison with continental butters generally our prices are more favourable than in the two previous years. For the year 1936 as a whole, the price of New Zealand finest salted butter averaged 10 per cent, more' than in 1935, while Danish showed an increase over the same period of 6 per cent During 1936 Danish butter averaged 18 per cent, higher than New Zealand, compared with 23 per cent, higher in 1935 and 35 per cent, higher in 1934. It should be noted that in 1936 New Zealand supplies increased substantially over the 1935 figures, whilst Danish supplies did not increase. (See price schedule, page 30.) Broadly speaking, the general improvement in butter quality, particularly in the lower-priced classes, must tend towards a narrowing of margins. Quality improvements in several countries supplying the British market have been accelerated by the creation of export Boards given power to regulate conditions of manufacture, grading, and sale. In many countries such authorities have also wide powers covering domestic and export marketing, and while their powers have not in some countries been exercised, the tendency is in that direction.

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Percentage | T e of Season ' of Australian ! Augtralia * Butter b I Butter sold 8old lo . b . or c .i. f . c.i.r. 1931-32 .. •• •• •• 35-6 29,927 1QS2—33 •• •• 28-9 26,959 ISIS :: :: is-s H,O«O i QH4—35 .. .. •• 16-8 18,600 1935-36 .. •• •• •• 7-8 6 > 859 1936-37 .. •• •• •• 10 ' 7 7 ' 697 (approx.)

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DAIRY INDUSTRY IN GREAT BRITAIN. In Great Britain the establishment of Milk Marketing Boards was a profound and important step to place the milk industry on an organized footing. In July, 1937 the British Government issued a statement of policy in relation to the British dairying industry. The following extracts are of particular interest to Dominion producers : (a) " The Government have carefully considered the position of the dairying industrv tile P ol^ s of v^ew of producers and others engaged in the industry and of consumers. They have had before them the report of the Reorganization Commission for Milk, other authoritative reports bearing on the industry, and also the views of representative organizations, all of which have been of the greatest assistance. They have also taken into consideration the recent outcome of the application made on behalf of milk-producers to the Import Duties Advisory Committee, for increased duties on butter and cheese." (b) "The Government desire to see the dairying industry of this country self-supporting and profitable, and their policy for this industry, as for other branches of agriculture is to ensure the maximum supplies for the consumer at fair prices consistent with reasonable remuneration for the producer. They believe that the only sure foundation for the prosperity of the industry is an increased consumption of liquid milk. An essential step towards this objective is to establish public confidence m the cleanliness and purity of the milk supplv and thereby quicken demand for what is one of the most valuable of human foods. It is with this object m view, and m order to bring to full achievement the efforts, that dairy farmers have themselves been making to improve the quality of their product, that they propose to invite Parliament to provide additional Exchequer assistance. (c) "The Government also propose to continue and extend their policy of promoting the increased consumption of milk among those sections of the population for whom it is of particular value. (d) It is still desirable to safeguard the industry against emergency conditions but circumstances have altered to an extent that now enables the Government to lay relatively greater emphasis on measures designed to promote the increased consumption of milk and the provision of a purer milk-supply. ( e .) " Under the Milk Act, 1934, the receipts of the Milk-marketing Boards from manufacturing milk were supplemented by a system of repayable exchequer advances based on standard prices per gallon of milk used for manufacture. The Government now propose to safeguard the industry against the effect of any serious fall in the prices of butter and cheese below current levels, by means of a pnce-msurance plan, under which exchequer assistance wi be payable, on a prescribed scale, to the Boards in respect of standard gallonages of milk used m factories for butter and cheese, and milk made into cheese on farms in the 6V( fL P no f of imported butter and cheese falling, over a period, below 100s. fi nir-n P< ? hundredwei g ll t respectively. The corresponding prices in February, 1934, when respectively Pr ° P ° Sals W6re annomiced > were 71s. 6d. and 475. 6d. per hundredweight

On the 28th July, 1937, the Financial Secretary to the Treasury made the following statement in the British House of Commons m reply to a question as to whether the Government had received any recommendation from the Impoit Duties Advisory Committee on the application for increased duties on butter and cheese : «rmii,. l ? 6 In ?° r ī! Ad l lsor y Committee have informed the Government that they have considered the application submitted to them by representative organizations of milk-producers for increased duties n„ h,it+o„ „ i cheese. I understand that the applicants had in mind that the proceeds of the duties should be applied as a subsidy for the benefit of the milk industry The Committee, having regard to the fact that it is not within their competence to advise as to the appropriation of revenue derived from import duties and to the fact that no material assistance could be given to the milk industry by means of increased duties, even of a very high order, and even if duties equal to the increase m the rates on foreign produce were imposed on Empire produce, have informed the Government that they could not make any recommendation on the application." Government that The total quantity of milk passing under tie control of the Milk Marketing Boards in England Wales, and Scotland m 1936 was 1,162,56] ,000 gallons, of which 753,088,900 gallons, equal to 65 per cent., were sold m liquid form, and 409,472,100 gallons, equal to 35 per cent., were used in manufacture. Milk consumed in liquid form increased by approximately 13,000,000 gallons in 1936, compared with the previous year, and further increases have been recorded in 1937. Increases are taking place, also, in the quantity of milk used in the production of cream and condensed milk, leaving smaller quantities available for the manufacture of butter and cheese. ■ ? ? mont nn°i l : J37 the P r ? duction of cheese in Great Britain was less than in the same period of 1936 by over 9,000 tons, a reduction of nearly one-third, while factory-butter production shows a reduction of 15 per cent. J 1 The smaller output of butter and cheese is not entirely due to the diversion of milk to the production of the higher-yielding commodities or to increased liquid-milk consumption. Total milk--2050S nUa Ull6 ' 1937 ' 18 lOW6r than m the Bame Peri ° d ° f 1936 by a PP roxi mately

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BUTTER-CONSUMPTION IN RELATION TO MARGARINE-CONSUMPTION. The following table shows the United Kingdom estimated butter production and net imports yearly from 1930 to 1936. The table shows the average weekly consumption of imported butter and the per capita consumption of all butters. The corresponding per capita figures in respect of •margarine are also shown.

United Kingdom Annual Production and Consumption of Butter.

A study of the seasonal changes indicates that consumption of butter is higher in the second half of the year than in the first six months. Weather and price are two important factors. Generally speaking, consumption appears to be high during the summer months and heaviest in the JulySeptember quarter ; at this period consumption of butter is supplemented by its use for other table requirements—ice-cream and reconstituted cream—and by wastage due to hot weather. CHEESE CONSUMPTION IN THE UNITED KINGDOM. Total cheese available for consumption in the United Kingdom has decreased during the past three years. Home production and net imports in that period were — 1934. 1935. 1936. Tons. Tons. Tons. Home production .. .. .. .. 50,238 57,074 54,585 Net imports .. .. .. .. 147,917 134,274- 132,600 198,155 191,348 187,185 1934. 1935. 1936. p er Per Psr In relative importance the main sources of supply are — Cent. Cent. Cent. New Zealand .. .. .. .. .. .. 53 46 45 Home production .. .. .. . . ~ .. 25 30 29 Canada .. .. .. .. .. .. .. 13 12 16 Canadian production in 1937 is considerably higher than in recent years, and, as the United States is unlikely to import as large a quantity of Canadian cheese as in 1936, supplies from Canada to Great Britain this year will be substantially higher than in 1936. New Zealand cheese will show a moderate increase, but Home production is on a considerably lower level. The estimated increase in imports from New Zealand and Canada, however, is likely to be greater than the reduction in Home production, and total supplies available, therefore, will probably show an increase on the previous year. Per capita consumption of cheese in Great Britain has not varied to any great extent in recent years. On the basis of net imports and estimated Home production, and excluding stocks in store which may have fallen slightly in 1936, the apparent consumption of cheese in the United Kingdom is estimated at 8-8 lb. per head, compared with 9-1 lb. per head in 1935 and 9-4 lb. per head in 1934. Price fluctuations do not appear to affect consumption so rapidly, or in the same degree, as in the case of butter. Extensive variation in total supplies of Home and Empire origin over short periods, therefore, are likely to create considerable difficulty in arriving at a price-level which will adjust consumption to available goods. Imports from foreign sources are not of great importance on the British market. They consist of special types for each of which there is a special but restricted demand, and are not, to an important extent, competitive with cheese of the Cheddar, Cheshire, or other well-known British types.

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Consumption. H., Y ™D=o.|. JB35S Nrttaport,. Total, all Butter. Imported „ £ a P lta ' Butter. aU Butter " Tons. Tons. Tons. Tons. Lb. Lb. 1930 .. .. 48,185 332,421 380,606* 6,435 18-7 11-8 1931 .. .. 48,185 385,451 428,236 7,335 20-9 10-3 1932 .. .. 48,185 402,946 446,131 7,650 21-7 9-2 1933 .. .. 48,185 437,300 491,655 8,475 23-5 8-4 1934 .. .. 48,185 480,180 528,365 9,170 25-2 7-9 1935 .. ,. 47,500 474,060 526,390 9,225 25-2 8-4 1936 .. .. 47,500 484,031 520,850 9,040 24-8 8-7 Source: Imperial Economic Committee. * Apparent total annual consumption: After 1930 changes in cold-storage stocks in the beginning and end of the year have been taken into account.

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Investigations made recently in Great Britain indicate that the per capita consumption of butter is highest in the high-income groups and shows a fairly regular increase as the income-level rises. Consumption of cheese, however, appears to increase as income rises in the lower- and middle-income groups, but falls sharply when the high-income levels are reached. If these investigations are to be taken as fairly representing the consumption trends throughout Great Britain, it might reasonably be contended that generally increasing prosperity will not necessarily bring about a marked increase in cheese consumption. The investigations referred to above were carried out by the Rowett Research Institute, and the following figures have been taken from tables appearing in Sir John Boyd Orr's report of the investigations entitled " Food, Health, and Income." The figures show the classification of the population of the United Kingdom by income groups, together with the average weekly expenditure per head in each group for butter and cheese : —

IMPROVEMENTS IN PROCEDURE OF MARKETING NEW ZEALAND BUTTER AND CHEESE. 1. Greater regularity in arrivals of consignments in London, Avonmouth, Liverpool, Manchester, and Glasgow. 2. Extension of direct shipments to East Coast United Kingdom ports, particularly Newcastle and Hull. 3. Increased expenditure on sales promotion and general publicity. In this connection the expenditure for the current season under these heads has been increased by approximately £40,000. ADVERTISING, PUBLICITY, AND SALES PROMOTION. The maintenance of an effective publicity policy in Great Britain in respect of New Zealand butter and cheese is essential in order to keep the Dominion's dairy-produce to the forefront in a highly competitive market, and the Department, in carrying out this important feature of its duties, aims at obtaining the utmost value and results from the funds expended for advertising purposes. It has been decided to extend the publicity, advertising, and sales-promotion activities of the Department with a view to providing greatly increased facilities for widening the distribution of New Zealand dairy-produce in the United Kingdom. The following is a brief record of the advertising and publicity work carried out during the year, which indicates the various methods of publicity adopted and the types of advertising used : — 1. The Retail Trade. Experience has proved that, with a limited expenditure for publicity purposes, which precludes the adoption of nation-wide advertising devoted directly towards consumers, the most effective point of contact is the retail shop, and in pursuance of this policy the Department has concentrated its efforts principally on the retailer in an endeavour to secure his good will and co-operation. This retail advertising includes — (а) Supplying window and counter display material, which is sent on request free of charge to retailers in parcels, each containing sufficient material for a reasonable display in an average shop : The distribution of this material to retail shops during the year amounted to 28,700 parcels. In addition to this standard material the Department has had prepared a comprehensive range of bigger and more elaborately designed show-pieces to meet the demand of the larger shops and departmental stores for assistance in staging special displays. This type of material is supplied on loan only . (б) Retail canvassing by representatives of the Department: The main object of this canvassing is to induce the shopkeepers to stock our produce, and it has been found in many instances that this system of personal contact has been effective when other advertising methods have failed. At present the canvassing is conducted by a supervisor and four travellers. London and the south of England is covered directly by the Dairy Sales Division at St. Olaf House. Other districts are covered by travellers, each of which has his own district. One serves Scotland, another

22

, _ . . Estimated Estimated Population Expenditure per of Group. Head per Week on Group. ! Income per Head per Week. Numbers. Butter. Cheese, centage. d. d. 1 .. .. .. 4,500,000 10 Up to 10s. .. .. 2-1 1-0 II .. .. 9,000,000 20 10s. to 15s. .. .. 4-7 1-4 III .. .. .. 9,000,000 20 15s. to 20s. .. .. 5-6 1-7 IV .. .. .. 9,000,000 20 20s. to 30s. .. .. 6-8 2-0 V .. .. .. 9,000,000 20 30s. to 45s. .. .. 8-0 2-4 VI .. .. .. 4,500,000 10 Over 45s. .. .. 10-1 2-1

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Display at London Grocers' Exhibition, Olympia, 1936.

[Face page 22.

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Bus Advertisement, Bank of England, London, 1937.

Bus Advertisement, Westminster, London, 1937.

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Manchester and Liverpool district, a third the West Riding of Yorkshire, and a fourth the Birmingham district, while the Supervisor has his headquarters at Manchester. During the year 12,114 calls were made' on retail grocers and wholesalers, reports being made of each call regarding the extent to which New Zealand butter was being stocked. (c) Supplying butter-wrappers : A system has been introduced whereby retailers who stock New Zealand butter may purchase from the Department, at cost price, smartly designed New Zealand butter-wrappers in 1 lb. and J lb. sizes, and during the year 1,125,000 of these wrappers were sold. (d) Participation in trade exhibitions : These exhibitions are usually organized by local grocers' associations, and the Department often book space for a display of New Zealand butter and cheese. Samples of the produce are also sold to interested visitors. (e) Advertising in grocers' price-lists and annual reports : Among the larger retailers there has been a growing practice of late of issuing their own price-lists for distribution to their customers, and in cases where the retailers are actively interested in increasing their sales of our products the Department takes advertising space in the price-lists. In regard to the annual reports of grocers' associations which are prepared in handbook form for circulation among association members, the Department is at times approached to advertise in these, and does so in a limited way. (/) Sampling demonstrations in retail shops : These demonstrations, which are carried out by departmental officers, are arranged with selected retailers and are supported by an adequate window and interior display. The usual period of the display is a week, but often the shopkeepers are so pleased with the results that they apply for an extension, which is granted whenever possible. The demonstrating is done by means of samples of butter which are moulded in a small machine, wrapped in special wrappers, and offered for sale to customers as they arrive at the shop to transact their usual business. The butter is supplied by the retailer, who retains the proceeds of sale. In the case of cheese, the samples have to be cut by hand, and the usual practice is to confine the demonstration to free tasting-samples. During the year a large number of these demonstrations have been carried out, and it is intended that the scope of this work should be enlarged as circumstances permit. The usefulness of the demonstrations is two-fold in that practical assistance is given to the retailer from a selling point of view, and, at the same time, an opportunity is afforded to the demonstrator to establish contact with the consumers. (g) Supplying material for carnivals and trade processions : Retailers often approach the Department for decorative material to be used in displays during local celebrations, and suitable advertising pieces are made available for this purpose. Special display cards were also prepared and supplied to retailers who desired suitable material with which to link up New Zealand butter and cheese with their Coronation displays. 2. The Wholesale Trade. In those districts through which the Department's travellers operate the wholesalers as well as the retailers are canvassed' and the Department also supplies to wholesalers and importers, on request, advertising-material for distribution to retailers. 3. Newspaper Advertising. During the season press advertising has been utilized, chiefly in Glasgow and the south-west of Scotland, Birmingham, and the Midlands, and Lancashire and the West Riding, at times when prevailing conditions in those districts appeared to call*for such advertising. In all, nineteen of the principal daily papers, having an aggregate circulation of 4,330,000 in the districts mentioned, were made use of, and the insertions in the various papers ranged from three to twenty-two, with a total of 154. 4. Advertising in Women's Journals. Publications for women offer a valuable advertising medium in respect of such articles as butter and cheese, and the Department arranged advertisements in fourteen of the leading monthly women's journals, which have a combined circulation of 1,900,000 copies. The insertions totalled sixty-three, several of which were full-page advertisements in colour. 5. Advertising in Trade Publications. It is essential that regular advertisements regarding our produce should appear in the trade periodicals, and, though the funds available do not permit of a complete coverage in this field, the Department's scheme allows for either half-page or full-page advertisements in all the principal trade papers. 6. General Editorial Publicity. Prepared articles on subjects such as health and diet, and food value and vitamin content of New Zealand butter and cheese, are supplied to various newspapers, and have been published from time to time.

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7. Outdoor Publicity. This branch of publicity has not been neglected, and in the Department's programme conspicuous positions have been occupied in London, Glasgow, Manchester, Sheffield, Liverpool, and Wakefield. Effective outdoor publicity has been secured through the commanding positions taken in Piccadilly, Manchester, and the Central Station, Glasgow, and also through the posters exhibited on the sides of London Transport buses. (See photograph.) 8. National Exhibitions. During the year the Department arranged displays at six large public exhibitions of established merit, including the Daily Mail Ideal Home Exhibition, and the London Grocers' Exhibition, both of which were held at Olympia, London. The Ideal Home Exhibition never fails to attract an exceedingly large number of visitors, and is open to the public for a period of twenty-three days. The sales of samples from the Department's stand at that Exhibition this year amounted to 35,000 samples of butter and 40,000 samples of cheese. 9. Temporary Display Shop. In an endeavour to stimulate the demand for New Zealand produce in Sheffield and district an exhibition shop was organized in Sheffield, and was open to the public from 2nd December to 19th December, 1936. In order to make a comprehensive display of the products of the Dominion, the New Zealand High Commissioner's Department, the New Zealand Fruit and Meat Boards, and the representatives of the New Zealand Honey Board joined with this Department in the undertaking. Also, with the object of making a reciprocal trade display, a number of the manufacturing firms in Sheffield were offered free space and invited to collaborate by making displays of their products, and nine firms did so. The Hon. Walter Nash and the High Commissioner for New Zealand (Mr. W. J. Jordan) were present at the exhibition when it was officially opened by the Lord Mayor of Sheffield. On the same day the Hon. Mr. Nash and Mr. Jordan were the guests of honour at a banquet presided over by the Lord Mayor of Sheffield. These proceedings received an excellent press report, which assisted materially in giving the exhibition a favourable start. Many thousands of the townspeople of Sheffield visited the shop, and samples of butter and cheese, and as many of the other products as possible, were sold to visitors, all purchasers being recommended in the customary way to obtain regular household supplies from their usual grocers. Excellent co-operation was received from the grocery trade as a whole, a large number of retailers making first-class displays in their own shop-windows. 10. Booklet : "At the Sign op the Cheese." This booklet was produced with the object of improving the demand for cheese by focusing attention on its valuable properties as a food, and suggesting, chiefly by means of a recipe section, the various methods in which cheese may be used as the principal ingredient in delicious and wholesome dishes. During the year 50,000 copies of the booklet were distributed from exhibition stands and during retail-shop demonstrations. SHIPPING. The opinion has been expressed in this report that greater regularity in arrivals of consignments of butter and cheese in the United Kingdom would assist the marketing plans of the Department. Undoubtedly improvements in this direction have been effected during the past few years. Suggestions for improvements in the arrangements for loading and despatch of vessels from the Dominion were invariably discussed when freight agreements were being settled. It will, however, be recognized by dairy-farmers that the freight contracts are only made possible by co-operating with the other exporting industries, particularly meat and fruit, and it is hoped that as further investigations are made it may be possible to provide for even more regular and reliable delivery to all United Kingdom ports. There are sixteen ports of loading in the Dominion for overseas vessels. Five of these are roadstead ports, where the risk of delay is considerable. It can thus be realized that it is difficult for the shipowners to arrange loading itineraries that will enable them to have their vessels arrive in the United Kingdom on specified dates. On their round trips vessels travel about 24,000 miles, and delays can occur from a variety of circumstances, thus upsetting the shipping programme. Allotments for contract cargoes such as meat, fruit, and dairy-produce are arranged some weeks in advance of loading, and the itineraries of the various vessels are worked out in advance. There are factors, such as weather conditions and accidents to vessels, which cause delays which are unavoidable. In addition, the multiplicity of loading ports increases the risk of delays. Experience has shown that under existing conditions it is not possible to have a hard and fast programme of regular arrivals, and that the best that can be done is to plan the allotments of produce and the sailing of vessels so that the greatest degree of regularity can be secured. Dairy-produce is available at ten ports of shipment in the Dominion, six in the North Island and four in the South Island. Three of the North Island ports are roadstead ports, but the quantity of dairy-produce shipped from these open ports represents a very small percentage of the total Dominion dairy-produce exports—slightly under 5 per cent.

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Produce was loaded into 108 vessels in the period mentioned, or an average of slightly over two per week, and the average ports of loading for each vessel for dairy-produce works out at 3'67 per vessel, arrived at as follows : — 5 vessels loaded dairy-produce at 1 port only. 16 vessels loaded dairy-produce at 2 ports only. 21 vessels loaded dairy-produce at 3 ports only. 39 vessels loaded dairy-produce at 4 ports only. 21 vessels loaded dairy-produce at 5 ports only. 6 vessels loaded dairy-produce at 6 ports only. 108 vessels, with 398 calls at ports for loading dairy-produce. (Many of these vessels also loaded cargo at other ports from which no dairy-produce was exported.) The average of 3'67 ports of call for each vessel loading dairy-produce represents a reduction when compared with the average of previous years. The comparison figures are as follows : — 1933-34 —122 vessels with an average of 3'77 ports per loading. 1934-35 —111 vessels with an average of 4-00 ports per loading. 1935-36 —104 vessels with an average of 3"98 ports per loading. 1936-37 —108 vessels with an average of 3 - 67 ports per loading. The complete arrangements for allocation of vessels for shipment of dairy-produce, for loading itineraries, and for quantities for shipment from the several grading ports, are settled, after discussion, with representatives of the shipowners. The shipping officer of the Department is constantly in touch with the Overseas Shipowners' Allotment Committee in an endeavour so to arrange the shipping programme that, as far as is possible, all grading ports will be cleared of produce evenly, according to date, and that there will be regular arrivals in the United Kingdom, in quantities to suit the market requirements. The Department has had the co-operation of the dairy companies in the despatch of increased quantities of butter and cheese to United Kingdom outports. During the season just closed the arrangements for supplies to the ports of Southampton, Avonmouth, Cardiff, Liverpool, Manchester, Glasgow, Newcastle, and Hull, owing to the system of centralized control, have been much more satisfactory than hitherto. SUPERVISION AND INSPECTION OF SHIPPING AND TRANSPORT OP DAIRY-PRODUCE. In the interests of the preservation of the quality of dairy-produce, supervision and inspection of shipping and transport is essential. This service was established by the New Zealand Dairy Board in 1924, and excellent results quickly followed. The Department lias three officers in New Zealand and one in London engaged in this work. The Department is paying for dairy-produce on the basis of quality as determined by the gradingpoints allotted by Government graders, and any deterioration in quality through mishandling or through faulty stowage, or carriage of produce at incorrect temperature, means a direct loss to the Department. The Inspectors of this Department collaborate with officers of the Dairy Division of the Department of Agriculture in connection with the care of produce in cool stores. The following is a summary of the measures adopted by the Department's Inspectors to safeguard the quality of butter and cheese : — (a) Inspection of coastwise vessels carrying butter and cheese, and the taking of the necessary steps to ensure cleanliness, and to avoid taint of butter through proximity to other cargo. (b) Periodic visits to cool stores to check method of stacking produce and, in co-operation with officers of the Dairy Division of the Department of Agricidture, checking freezing temperatures in the case of butter storage, and temperatures and relative humidity in the case of cheese storage. (c) Inspection of the transport of all the dairy-produce sent coastwise, and the taking and recording of temperatures. (id) Supervision of the conditions of handling produce from railway-trucks to ship's slings to prevent careless handling. (e) Taking and recording temperatures of both butter and cheese at the time of tender from the cool stores to overseas vessels. (/) Inspection of all refrigerated spaces on each overseas vessel as far as possible prior to loading, to see that such spaces are clean, properly battened to give the necessary air-spacing for cooling, and that they are free from foreign odours likely to contaminate butter, such as from fuel-oil fumes, fruit, bonemeal, and the like. (</) The placing from time to time of temperature-recording thermographs in the cargo to register the temperature for the period of the voyage of carrying-vessels. (h) A general supervision of the stowage during loading to prevent damage from crushing, and to allow for air circulation in holds. (i) On discharge at ports in the United Kingdom, an inspection of each hold to take temperatures of the butter and cheese at varying points to check up with the ship's logged temperatures.

4—H. 30.

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{j) If damage of any nature occurs, to find, if possible, the cause, and to report back to New Zealand to enable steps to be taken to reduce the risk of damage on the next occasion of loading. (k) A periodic inspection of cool stores at Hay's Wharf and Surrey Commercial Docks, London, to check up all conditions relative to the storage of New Zealand dairy-produce, and a general supervision of the handling at all ports of discharge in the United Kingdom. The system of supervision and inspection of all dairy-produce is a factor in the determination of the basis of the contract for insurance and on the insurance-rates charged. The insurance is a comprehensive cover which includes all risks from the time of receipt of the milk or cream at dairy factories, all stages in transport, period of storage in cool store, ocean transport, and a period of thirty days in cool store after discharge from steamers. With such a comprehensive cover, the supervision and inspection becomes of the utmost importance, and the excellence of the results achieved is reflected in the reduced insurance-rates. The rates in 1923-24 were— Butter.. .. .. .. .. .. lis. 4d. per cent. Cheese.. .. .. .. .. .. 13s. l|d. per cent. whereas the present rates are — Butter.. .. . . .. . . .. 4s. lOd. per cent. Cheese.. .. .. .. .. .. ss. 3d. per cent. a reduction of 57 per cent, in the case of butter and 60 per cent, in the case of cheese. The insurance underwriters make it a condition of their contract that the system of supervision and inspection be continued. Freight Rates. The freight contract for butter and cheese and meat and fruit expired on 31st August, 1936, and was renewed for a further three years. The new rates for butter and cheese are — Butter, 2s. 11M. per box .. .. .. .. _~ . ,• Cheese, #d. per pound / Both rates m sterlm g" These rates represent an increase of 2J per cent, on the rates previously ruling. Cold Storage in the United Kingdom. All butter and cheese arriving at London is discharged overside ship into barges for conveyance either to Hay's Wharf or to the stores of the Port of London Authority. The produce is there sorted and placed in cold storage until such time as delivery is taken by the buyers. Similar arrangements with cold-store authorities are in operation at Bristol, Liverpool, and Manchester. From Ist December, 1936, the London contracts with Hay's Wharf Company and with the Port of London Authority were renewed for a further period of three years at the following rates, which showed a slight reduction on the rates previously ruling :— Butter : Consolidated rate, 15s. 6d. per ton gross — From Ist May to 31st October, rate includes rent for one week. From Ist November to 30th April, rate includes rent for two weeks. ss. 6d. per ton first week's rent subsequent to free period ss. per ton second and later weeks' rent subsequent to free period. Cheese : Consolidated rate, 15s. 3d. per ton gross (includes one week's rent) — Winter period, Is. 9d. per ton per week after first week free rent. Summer period, 2s. 3d. per ton per week after first week free rent. Marine Insurance. All butter and cheese exported from New Zealand and purchased by the Department is protected by a comprehensive insurance contract, which covers the produce until thirty days after arrival in the United Kingdom. The contract also covers the cream and milk, which is made into butter and cheese intended for export, and which is identifiable as such, from the time such cream and milk is received at the factory until the produce is placed f.o.b. ocean steamer. The Department pays the insurance underwriters' flat rates covering the complete risk, and charges to dairy-factory companies the portion of the premium which represents the risk up to f.o.b. ocean steamer. The contract has a three-year term, and expires on 31st August, 1938. The inclusive rates are— Butter .. .. .. .. .. 4s. lOd. per cent. Cheese .. .. .. .. .. ss. 3d. per cent. Plus a war-risk premium of sd. per cent. The portion of the premium which represents the risk up to f.o.b. ocean steamer, and which is charged to dairy-factory companies, is as follows : — Butter .. ' .. .. . . .. . . 0-69 d. per box. Chees# .. .. .. .. .. .. l-085d. per crate.

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SALES OF BUTTER AND CHEESE TO MARKETS OTHER THAN UNITED KINGDOM. The Department has endeavoured to increase sales of butter and cheese in markets other than the United Kingdon, and the requirements of firms regularly trading in those markets have been regularly supplied. The Department has always been prepared to quote on a f.o.b. basis for shipment to outside markets, and to arrange for supplies of the required types of produce, and for the special packaging which is frequently necessary. It can be stated that the Department's principle of equal treatment, both as regards supplies and prices, of all those exporters who have been doing business with ports outside United Kingdom, has been favourably commented on by exporters, and on the whole has led to an increase in the business done. Sales have been as under : —

New Zealand Dependencies and Neakby Islands. In view of the large number of small and irregular lines of butter and cheese shipped to these groups —namely, Cook and Savage Islands, Samoa, Fiji, Tonga, New Guinea, and Tahiti—it was decided that such shipments should be treated as local trade, and left to New Zealand firms to handle, subject to their supplying regular monthly returns to the Department. Panama and Jamaica. The regular sale of butter to these points has been maintained. In both places New Zealand butter holds the bulk of the trade. Honolulu. Shipments show a considerable increase, largely due to the American shipping strike, which shut off Californian supplies for some weeks.

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Port. I Butter (Boxes)i Cheese (Crates). Eastern Ports — Japan —• Kobe ... .. . ; • • • • 5,552 Osaka .. .. . • • • ■ • 40 Yokohama .. .. .. •• 2,110 — 7,702 Philippine Islands .. .. v •• 2,200 Singapore .. .. •• •• 8,526 French Cochin China.. .. .. •• 765 China — Hong Kong .. .. . • • • 3,900 Shanghai . • • • • • ■ • 8,530 Tientsin.. .. .. • • • • 200 12,630 348 India — Bombay .. •• •• •• 1,785 Calcutta .. . • • • • • 2,888 Madras 1,399 5 Rangoon .. . ■ . • •• 252 Colombo . ■ • ■ ■ • • • 50 — 6,374 Pacific and North America— Honolulu .. .. .. ■ • • • 26,200 San Francisco .. .. •• •• 1,038 4 Vancouver .. . ■ • ■ • • 426 1,215 New York .. .. •• •• 2,850 30,514 1,219 Panama Canal Zone — Cristobal .. .. .. •• •• 26,129 4 Balboa . . . . . • • • ■ ■ 12,525 38,654British West Indies — Bahamas .. .. • ■ • • • • 655 Bermudas .. .. • • • • 300 Jamaica .. .. . ■ • • • • 17,013 81 17,968 125,333 1,657

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China and Japan. Quantities shipped to these countries have shown an increase, towards which the Department's system of selling has materially assisted. Saigon and French Indo-China. Small quantities of butter are shipped here, but New Zealand is handicapped by being on the maximum rates of Customs duties as against certain foreign countries, notably Lithuania, which enjoy trade treaties with France, and thus pay minimum duties on exports to France and her colonies. India. The shipments to this country are small but are well distributed, supplies going to Bombay, Madras, Calcutta, and Rangoon (Burma). The demand is for butter in pats, and is apparently limited to the white population and the well-to-do section of the Indian people. The suggestion made in some quarters that there is a great untapped market for our butter and cheese in India would appear to be based on a standard of living that is at present far ahead of the standard of the great majority of the people of India. Nevertheless, competent observers indicate that it is possible to develop trade in butter with India, although progress will be slow. United States. This country s imports of butter have always been irregular, and this year shipments were only 3,888 boxes. MARKET CONDITIONS DURING 1936-37 SEASON AND TREND OF PRICES. BUTTER. The outstanding feature of the market during the 1936-37 season was the sharp decline in price which occurred in February. During that month London quotations touched 83s. per hundredweight, which was the lowest point reached during the season. In explanation of this drop in price, and in answer to criticism that the decline was due to the new marketing-system, the following statement was issued on 24th February, 1937 : — " It has been suggested that the present market price of 83s. per hundredweight for New Zealand butter is due wholly or in part to the present marketing-policy. The advices received by the Marketing Department show that the market is dominated by the unusually heavy stocks in store compared with the stocks last year. The unexpectedly heavy imports of Northern Hemisphere butter during December and January prevented any decrease in accumulated stocks. Actually, imports from Northern Hemisphere countries and from the Argentine were 5,700 tons above last year for the five weeks ending 20th January, the principal increases being from—Russia (1,700 tons), Netherlands (1,300 tons), Denmark (1,100 tons), Baltic States (800 tons), Argentine (600 tons), Finland (300 tons), and Sweden (200 tons) ; and small increases have been registered from Poland and two or three of the more unimportant suppliers. While this continental type of butter is available, the increased demand which we look for in the Midlands and the North for New Zealand and Australian butter at this time of the year is retarded, and it is perhaps surprising that the wholesale and retail trader has been willing to buy so much New Zealand and Australian butter recently to hold in store. T- he drop in price applies to all butters, and it is expected that the lowering of the retail price of butter in London from Is. to lid. per pound will stimulate consumption and result in a better market position. " During the third week in March, 1936, the price fell to 80s. per hundredweight. The retail price was then reduced from Is. to lid. per pound, and a better market followed. " Thus, the experience of the market this year is very much in line with the experience of last year, with the difference that the drop in price, due to heavy arrivals, has come a few weeks earlier this year. It should be remembered that during the 1934-35 season the wholesale price of butter fell to 655. per hundredweight." Subsequent to February, 1937, prices rose sharply from 83s. to 975. per hundredweight by 12th March, and then steadily rose without any serious setback to 118s. per hundredweight at 31st July, The following table of average monthly prices of butter at London shows, in respect of New Zealand, Australian, and Danish, the movement in price during the season just closed compared with the corresponding period for the previous season. It should be noted that the selling of New Zealand butter under the new marketing-system began in November, 1936.

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BUTTER PRICES. London Weekly Average Cabled Quotations (per Hundredweight Sterling), 1st August, 1936, to 31st July, 1937.

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Average Monthly Prices of Butter at London.

(See also graphical tabulation of the weekly prices, which is published in this report.) It is interesting to observe that, in respect of the period covered by the new marketing-system the premium for Danish butter over New Zealand is 14s. lid. per hundredweight, compared with 225. 6d. per hundredweight for the corresponding period of the previous season. A price premium is paid for Danish butter because of its particular flavour and texture, and because it is fresh-made (not frozen and stored as in the case of New Zealand). The Danes built up a good market in the North of England for their butter by providing regular weekly supplies of uniform high quality. New Zealand, by improvement in quality, and in the regularity of supplies, has been steadily overcoming the advantages of proximity to the market enjoyed by the Danes, and outlets have been found for increasing quantities of New Zealand butter year by year. Compared with Dutch butter and Baltic States butter, New Zealand this season shows more favourable prices than during the previous two years, and the comparison of Danish butter margins which has been quoted entirely disproves any suggestion that the present market policy has led to a widening of the Danish price-margin over New Zealand. On the contrary, the evidence supports the contention that the new marketing-system assists in a narrowing of the margin. The following table shows the United Kingdom imports of New Zealand, Australian, and Danish butter for the period November to July in the season just closed, compared with the imports for the corresponding period in the previous season: —

United Kingdom Imports of Butter.

The outstanding feature in the supply position in respect of New Zealand, Australian, and Danish butter on the United Kingdom market during the period of sale of butter purchased by the Government is the decrease in supplies of Australian. For the nine months November, 1936 to July, 1937, Australian supplies showed a decrease of 17,255 tons, whilst New Zealand showed an increase of 8,028 tons and Danish an increase of 6,207 tons. Much attention is being given in the United Kingdom to the question of nutrition and the publicity of the Department stresses the food value of butter. There is evidence of an increasing appreciation of its superiority over margarine as a food. Without doubt, price is a most important factor, and it is the general experience that when the retail price of butter in the United Kingdom increases beyond Is. Id. per pound the tendency under normal circumstances is for butter sales to decline and a section of the consumers purchase margarine as a substitute. Cheese. The following table of average monthly prices of cheese at London shows, in respect of New Zealand and Canadian cheese, the movement in price during the season just closed compared with the corresponding period for the previous season. Sales of New Zealand cheese purchased by the Government began in November, 1936.

Average Monthly Prices of Cheese at London.

30

New Zealand Australian . Month Finest Salted. Finest Salted. Danish. 1935-36. 1936-37. 1935-36. 1936-37. 1935-36. 1936-37. Per Cwt. Per Cwt. Per Cwt. Per Gwt. Per Cwt. Per Cwt. November .. .. .. 102/6 109/- 102/- 107/9 124/9 122/6 December .. .. .. 90/3 100/6 89/6 98/9 127/9 114/9 January .. 95/- 94/6 94/3 94/6 119/6 113/February .. .. .. 93/9 86/6 92/6 86/6 129/- 119/6 March .. .. .. .. 84/3 96/3 84/- 96/6 122/6 126/9 April .. .. .. • • 88/3 105/- 87/9 104/6 106/- 115/May .. .. .. .. 94/6 107/- 93/3 106/- 104/6 110/6 June .. .. .. .■ 108/3 110/- 107/- 108/6 115/6 114/9 July .. .. • • ■ • H4/9 114/- 113/6 112/- 124/6 120/Average, 9 months .. .. 96/10 102/6 96/- 101/8 119/4 117/5

New Zealand. Australian. Danish. 1935-36. | 1936-37. 1935-36. 1936-37. 1935-36. 1936-37. Tons. Tons. Tons. Tons. Tons. Tons. November to July (inclusive) .. 108,405 116,433 j 79,282 62,027 79,360 85,567

New Zealand (Finest White). Canadian (Finest White).* Month. . — —J,—, ! . . , U '., I— 1935-36. 1936-37. 1935-36. 1936-37. Per Cwt. Per Cwt. Per Cwt. Per Cwt. November .. .. 52/6 72/3 58/6 73/3 December .. .. 54/- 62/9 59/6 71/9 January .. .. 54/9 55/6 62/- 72/February .. .. 52/6 53/- 62/6 72/— March .. .. .. 50/3 60/6 63/- 73/April 53/6 68/3 62/- 75/6 May .. .. .. 57/- 72/6 63/6 78/3 June .. .. .. 59/9 74/3 67/6 80/July .. .. .. 61/6 73/- 64/3 76/Average, 9 months .. 55/1 65/9 62/6 74/8 * Old.

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CHEESE PRICES. London Weekly Average Cabled Quotations (per Hundredweight Sterling), 1st August, 1936, to 31st July, 1937.

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The United Kingdom imports of New Zealand and Canadian cheese for the period under review are as follow :—

United Kingdom Imports of Cheese.

The outstanding factors for consideration in connection with the United Kingdom cheese import position are firstly the Home production and secondly the quantity of New Zealand imports. During 1936 the United Kingdom production of cheese was approximately 55,000 tons, which represented 30 per cent, of the country's requirements. It is to be noted that in the first six months of 1937 the production of cheese in the United Kingdom was less than in the same period of 1936 by over 9,000 tons, a reduction of nearly one-third. Thus it can be taken that market prices for New Zealand cheese during the past season have been aided by the reduced Home production, notwithstanding the increase in Canadian importations. In recent years cheese prices have not been affected by available supplies to the same extent as in the case of Importations of cheese into the United Kingdom during the past years have remained almost stationary. It is certain that, notwithstanding the supply position, cheese-prices will move up or down in sympathy with the prices of butter. In a recent report Professor W. Riddet, in commenting on the factors which influence the demand for cheese, said,— " It is difficult to explain why in recent years consumption of cheese has not responded to fall in price, as has been the case with butter. Several explanations are offered. It is stated that people prefer cheap meat to cheap cheese. It is also stated that with the falling-ofE in employment among the most important cheese-consuming people (miners) the demand has fallen off. Some believe that the habits of the people have changed : with' an improved standard of living, cheese forms a lesser part of the diet. Others have expressed the views that, firstly, some people went off cheese when there was much poorquality produce on the market, and, secondly, the predominance of New Zealand cheese in the market, with its milk flavour, has reduced consumption —i.e., it is not sufficiently Ihe Government proposes to continue investigations with a view to ascertaining the possibilities of extending the demand for the best type of cheese that can be produced in the Dominion. MANUFACTURE OF GHEE FOR SALE IN INDIA. From time to time representations have been made to the Government that there are distinct possibilities in the sale of ghee to India. Ghee is a form of edible fat used throughout the East, and consists of pure clarified milk-fat. It is said to be frequently, but unlawfully, mixed with other fats. Most of the ghee sold in India is prepared from the milk of buffaloes, which produce fat that is practically colourless, and is different in chemical composition from the butterfat of the cow. Since ghee is pure fat and contains no moisture, it can be kept for long periods of time at ordinary temperature without undergoing changes. It has been suggested that pure clarified New Zealand butterfat, which is comparatively easy to prepare from butter, would be suitable for the ghee trade, but local butterfat has certain characteristics which, while highly desirable for buttermaking, make the production of high-grade ghee difficult. Ghee made from New Zealand cow butterfat melts at a considerably lower temperature than the native buffalo ghee, and therefore softens more readily in tropical climates than the native product. Ghee made from New Zealand butterfat is too yellow in colour, and it is difficult to impart to it the required characteristic flavour. Small experimental quantities of ghee were made at the Dairy Research Institute at the Massey Agricultural College, and were shipped to merchants in India. Four of the samples were yellow in colour, though made in different ways, and two samples were bleached. The yellow samples were declared to be unsuitable in colour. The bleached samples were correct as to colour, but not quite suitable in flavour. At the request of the Government, Professor W. Riddet, Director of the Dairy Research Institute, went to Bombay and investigated the possibilities of development of trade in ghee of New Zealand manufacture. The following is a summary of the conclusions of Professor Riddet's report on the subject: — (1) Although the population of India is very great and a very large proportion of the population could consume more ghee, the purchasing-capacity of the masses is so limited that at present prices any material demand for New-Zealand-made ghee could not readily be created. (2) For technical reasons, New Zealand con Id not make cow-butterfat ghee equal in quality to the best locally made buffalo-fat ghee. It could, however, produce saleable ghee which would find an average demand once well established.

32

New Zealand. Canadian. 1935-36. 1936-37. 1935-36. 1936-37. Tons. Tons. Tons. Tons. November to July (inclusive) .. 67,707 68,415 13,041 19,487

H.—3o,

(3) Ghee is extensively made by Indian villagers, who view their returns from the sale of ghee as a useful supplement to their income, but they are not dependent alone on this, consequently any additional supplies on the market would merely depress price without in any way reducing the volume of produce made in the Indian villages. (4) New Zealand ghee would need to be sold at the average price of the local product (about lOd. per pound) and would be worth less than its realization in the form of butter at present prices in the United Kingdom. (5) There is an import duty on ghee imported into India the equivalent of 14s. 7fd. sterling per hundredweight. In addition, most cities and towns impose a town duty, which, in the case of Bombay, is 3s. 9d. per hundredweight. The total charges imposed on ghee entering into India at the port of Bombay at the time of my visit were approximately 19s. Ofd. sterling per hundredweight. (6) Although adulteration of ghee appears to be commonly practised, there are available supplies of pure ghee, both cow and buffalo, to meet the demands of those prepared to pay high prices for finest-quality products. Locally made vegetable product competes with pure ghee, and is available in considerable quantity at prices lower than ghee. (7) Doctors prefer cow ghee to buffalo ghee, and if New Zealand ghee could be introduced to the market its high vitamin content would be an added attraction, but it would entail both expensive advertising and the breaking-down of time-honoured prejudices to make the venture successful. (8) India has already an export trade in ghee, and efforts are being made to expand dairying in that Dominion. (9) Instead of attempting to create a market for ghee, already well provided for by local effort and of quality superior to that which we are likely to make, it is better policy for us to concentrate upon the sale of butter to the relatively small section of the community who have a high purchasing-capacity, and who would be willing to pay a reasonable price for a good-quality product. It will be observed that Professor Biddet does not indicate any bright prospect for profitable development of trade in ghee. This viewpoint is supported by the Australian Trade Delegation which visited India last year, seeking information with a view to supplying India's needs from Australia. The Australian Dairy Review reports the opinion of the delegation as follows " In the course of the delegation's inquiries a mass of detail was obtained on which the delegation based as one conclusion that the disparity in possible return to Australian producers between ghee at 6d. per pound for India and butter at Is. per pound for London was so great that is was obvious that the Indian ghee-market was of no value to Australia. The lowest recorded price for low-grade butter on the London market was 58s. per hundredweight sterling in December, 1934, but before the ghee-market could even be considered by Australian producers the price for even the lowest grade would have to fall to 445. lOd. per hundredweight. If in any circumstances it should be found necessary to look to India for a market, the delegation expressed the opinion that sales of ghee could be made at a price, but that it would be necessary to organize carefully in advance." PAYMENTS MADE BY DAIRY-FACTORY COMPANIES FOR BUTTERFAT-SUPPLIES. The accounts and statistical statements of dairy-factory companies are published this year, for the first time, in a standard form as prescribed in the Dairy Industry Accounts Regulations. The uniform presentation of the results of the operations of companies enables fair comparisons to be made and provides a fund of information of great vlaue to the dairy industry and to the Government. Dairy-company suppliers, directors, and officials are enabled to compare the results of their operations with those of neighbouring companies. In addition, reliable data on butter-manufacturing costs, cheese-manufacturing costs, and on dairy-company butterfat-prices to suppliers are available to the Government for the purpose of determination, in accordance with the provisions of the Primary Products Marketing Act, of the guaranteed purchase prices for butter and cheese. The average butterfat-prices paid to suppliers of both butter- and cheese-manufacturing companies for the 1936-37 season are shown in a tabulation included in this report, The dairy companies are grouped, for purposes of averaging, under the appropriate dairy-produce grading ports. In any comparison of butterfat payments to suppliers of companies, regard should be had to the location and special circumstances of individual companies, which will inevitably have a bearing on manufacturing and transport costs. COSTS IN MANUFACTURE AND DELIVERY OF BUTTER AND CHEESE TO F. 0.8. OVERSEAS STEAMERS. The standard form of published accounts referred to under the heading " Payment made by Dairy-factory companies for Butterfat-supplies" provides for the grouping in the manufacturing and marketing accounts of dairy companies of the costs, under six headings, as follows : Cream Collection, Manufacturing Charges, Depreciation, Repairs and Maintenance, Charges Factory to f.0.b., Overhead Charges. The costs of all items grouped under the six headings mentioned are shown worked out on the basis of per pound of butterfat. In addition the total cost to f.o.b. per pound of butterfat is recorded. Thus a reliable comparison of costs, item by item, is provided. This comparison is of great value to those interested in the work of dairy-factory companies and to the Government. The average costs of both butter- and cheese-manufacturing companies for the 1936-37 season are shown in a tabulation included in this report. The dairy companies are grouped, for purposes of averaging, under the appropriate dairy-produce grading ports.

5—H. 30.

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Season 1936-37: Costs in Manufacture and Delivery of Butter to f.o.b. Overseas Steamers.

Season 1936-37: Costs in Manufacture and Delivery of Cheese to f.o.b. Overseas Steamers.

Season 1936-37: Estimated Payments by Dairy Companies for Butterfat-supplies.

34

(In pence per pound of butterfat.) 5P I . rO .3 TS <V d fn • O pj © .. O <r"0 <n *-+2 § «5 «w c^OQ I '-§ § Ef -g x 8 S Sb-3 Ji S) "s a! II I 11 |r f I I o «I ! ° (5 Auckland .. .. .. .. 0-339 0-867 0-060 0-096 0-414 0-115 1-891 New. Plymouth .. .. .. 0-233 1-085 0-094 0-081 0-299 0-129 1-921 Patea-Wanganui .. .. .. 0-376 1-106 0-121 0-073 0-325 0-197 2-198 Hawke's Bay - Gisborne .. .. 0-380 1-011 0-084 0-048 0-465 0-220 2-208 Wellington .. .. .. .. 0-332 0-963 0-068 0-078 0-349 0-145 1-935 Marlborough-Nelson-W estland .. .. 0-409 1-117 0-156 0-081 0-507 0-240 2-510 Canterbury .. .. .. .. 0-796 1-019 0-080 0-044 0-314 0-442 2-695 0ta g° •• •• 0-850 1-355 0-081 0-071 0-491 0-699 3-547 Southland .. .. .. .. 0-444 1-267 0-300 0-112 '0-299 0-515 2-937 New Zealand average .. .. 0-352 0-927 0-072 0-088 0-398 0-147 1-984

(Ill pence per pound of butterfat.) Manu- Repairs | Charges: „ , , — facturing Depreciation. and ! Factory to Overhead Total Charges. Maintenance.: f.o.b. Charges. Charges. ! J ; Auckland .. .. .. 2-146 0-155 0-140 0-607 0-134 3-182 New Plymouth .. .. 1-949 0-127 0-117 0-491 0-193 2-877 Patea-Wanganui .. .. 1-909 0-108 0-177 i 0-485 0-200 2-879 Hawke's Bay - Gisborne .. 2-103 0-175 0-125 0-803 0-326 3-532 Wellington .. .. 2-114 0-107 0-140 0-681 0-255 3-297 Marlborough-Nelson.. .. 2-263 0-247 0-165 0-843 0-438 3-956 Canterbury.. .. .. 2-128 0-165 .0-108 I 0-591 0-504 3-496 Otago .. .. .. 2-459 0-192 0-201 ! 0-691 0-418 3-961 Southland .. .. .. 2-291 0-173 0-137 0-670 0-345 3-616 New Zealand average .. 2-056 0-134 0-146 0-577 0-226 3-139

(In pence per pound of butterfat.) Butter. Cheese. Auckland .. .. .. .. .. .. .. 13.575 14-766 New Plymouth .. .. .. .. .. .. 13-584 14-444 Patea-Wanganui .. .. .. .. .. .. 13.475 14-512 Hawke's Bay - Gisborne .. .. . . .. . . 13-381 13-761 Wellington .. .. .. .. .. .. .. 13.555 14-154 Marlborough-Nelson-'Westland .. .. .. .. .. 13-049 13-688 Canterbury .. .. .. .. .. .. .. 13-163 14-260 0ta g° -• •• •• •• -- .. 12-773 13-677 Southland .. .. .. .. .. .. .. 12-310 14-468 New Zealand average.. .. .. .. .. 13-529 14-440

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DAIRY INDUSTRY ACCOUNT. Record of Weekly Balances, 1936-37 Season.

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ACCOUNTS. The accounts submitted with this report are in terms of New Zealand currency, and they show the operations of the Department in the purchase and sale of export dairy-produce for the 1936-37 season. The accounts cover all export butter and cheese which was manufactured from Ist August, 1936, to 31st July, 1937, the quantities being— 149,810 tons of creamery butter. 1,446 tons of whey butter. 86,708 tons of cheese. The average f.o.b. purchase prices paid or payable for this produce in terms of the Primary Products Marketing Act are as follow :— Creamery butter. . .. .. .. .. 12-6624 d. per pound. Whey butter .. .. .. ~ . . 11-4829 d. per pound. Cheese .. .. .. . . . . . . 7-2 d. per pound. The average approximate f.o.b. realizations for produce (actual and estimated), as shown in the accounts, are as follow :— Creamery butter.. .. .. .. .. 12-261 d. per pound. Whey butter .. .. .. .. .. 11-06 d. per pound. Cheese . . .. .. .. .. . . 7-223 d. per pound. In the compilation of the accounts butter and cheese unsold at balance date were taken in at the following values : — Creamery butter (shipments partially sold) : 115s. per hundredweight sterling gross. Creamery butter (in store awaiting shipment) : 116s. per hundredweight sterling gross. Whey butter (shipments partially sold) : 107s. per hundredweight sterling gross. Whey butter (in store awaiting shipment) : 108s. per hundredweight sterling gross. Cheese (shipments partially sold) : 675. 6d. per hundredweight sterling gross. Cheese (in store awaiting shipment) : 645. per hundredweight sterling gross. The accounts submitted comprise : — (1) Separate Purchase and Sale or " Pool " Accounts for creamery butter, whey butter, and cheese. (2) Administration and General Expenses Account. (3) Dairy Industry Account. (4) Balance-sheet. The Purchase and Sale or " Pool " Accounts show the purchase value of the produce, and the sale-value less selling charges, freight, and insurance. To each Purchase and Sale Account is charged its proportion of the total administration and general expenses, amounting to £174,266 19s. 3d. To the Creamery Butter Purchase and Sale Account is charged the amount of £30,866 17s. due to the Butter-box Pool Account, following the decision of the Government to make a refund of the deductions made from payments to dairy companies which had used the " Saranac" type butter-box for the packing of their butter. To the Creamery Butter Purchase and Sale Account is also charged the sum of £16,000, being the estimated amount due to butter-manufacturing companies to preserve equity in. respect of grading dates of produce payable at thel936-37 and the 1937-38 guaranteed prices. The explanation of this item is that certain dairy companies, complying with the requests of the Department, sent forward for shipment from time to time quantities of butter and cheese for United Kingdom outports and destinations other than London. In so doing these dairy companies, in comparison with other companies, had a greater proportion of their produce payable at the 1936-37 guaranteed prices, and thus suffered the loss of the difference between the 1936-37 and the 1937-38 prices on such excess proportion. The additional payment of £16,000, which has been provided for in the accounts, corrects this disparity in so far as creamery butter is concerned. To the Cheese Purchase and Sale Account is charged the sum of £28,000, being the estimated amount due to cheese-manufacturing companies to preserve equity in respect of grading dates of produce payable at the 1936-37 and the 1937-38 guaranteed prices. The explanation given above of the corresponding item in the Creamery Butter Purchase and Sale Account applies also to this item of £28,000. To the Cheese Purchase and Sale Account is also charged the sum of £165,000, being the sum estimated to provide a further payment of Jd. per pound on all cheese graded up to and including 18th March, 1937, purchased by the Government and exported from New Zealand on or before 31st July, 1937. The effect of this provision is that a further payment of Jd. per pound will be made on all cheese which has been paid for at the 1936-37 season prices. Provision has been made for payment on whey butter to preserve equity (as in the case of creamery butter and cheese) in respect of grading dates of produce payable at the 1936-37 and the 1937-38 guaranteed prices. The amount involved is included in the sum of £28,000 charged to Cheese Purchase and Sale Account. The Administration and General Expenses Account shows the itemized expenses in the United Kingdom and in New Zealand, and the expenses and charges due or accruing on sale of the 1936-37 season produce. After deducting the proportion of the 1935-36 levy to cover the expenses incurred in marketing the balance of the 1935-36 season product, the balance of this account is allocated to the Produce Purchase and Sale Accounts as already mentioned.

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Tke Dairy Industry Account shows the position of the Produce Purchase and Sale Accounts as follow: — £ s. d. £ s. d. Estimated deficit on creamery butter . . . . . . ■ ■ 561, 397 1 6 Estimated surplus on cheese .. .. •• •• 18,354 7 6 Less estimated deficit on whey butter .. .. .. 5,707 5 9 — 12,647 1 9 Estimated deficit Dairy Industry Account, 1936-37 season .. .. 548,749 19 9 The balance-sheet is drawn up in the usual form to show liabilities and assets as at 31st July, 1937. The Government desires to acknowledge the co-operation and assistance which have been received from organisations interested directly and indirectly in the marketing of the primary products of the Dominion. In particular, the Government has appreciated the co-operation of the farming industry and of the directors and officials of dairy companies. The Dairy Board, the National Dairy and South Island Dairy Conferences and the farmers' organizations have been at all times helpful in the expression of their views. Finance, shipping, and cool-store interests have also given a full measure of co-operation, both in New Zealand and in London. In the United Kingdom members of the provision trade and the appointed agents of the Department have given their support to the Dairy Sales Division, which has endeavoured to improve the marketing of New Zealand dairy-produce on non-speculative lines. Che success which has been achieved is due to a considerable extent to this helpful co-operation. The Government realizes that its policy for the betterment of conditions in primary production in the Dominion can only be implemented to the full with the co-operation and assistance of interested sections of the community. INTERNAL MARKETING DIVISION. The Internal Marketing Division of the Primary Products Marketing Department was established in February, 1937, when the Government acquired the business of Picot Bros., Ltd. The purchase was made on a valuation basis, and included the premises, plant, and stock-in-trade, whilst the services of the managing director were retained as Director of Internal Marketing. At that time, the company was the largest wholesale dealer in primary food products for the local market in the Dominion, and the Government on assuming control became possessed of an organization competent to carry out the handling and distribution of primary foodstuffs in the capital city and also in certain districts of the Wellington Province. At the time of the purchase, Picot Bros., Ltd., were operating two branches in Palmerston North and Hastings respectively. The latter has, however, since been disposed of to the co-operative dairy interests in Hawke's Bay, who were desirous of undertaking the marketing of their own produce in that area. The basis of this transaction was the same as that used in the purchase of Picot Bros., Ltd., referred to above, so that neither profit nor loss to the Government resulted. The new concern thus established under co-operative control became the sole distributor of butter in Hawke s Bay, and at the same time became an important factor in the distribution of other primary products within the district. Butter-marketing. As a means of stabilizing prices and regulating the marketing and distribution of butter within the Dominion, following upon the policy adopted by the Government in respect of butter intended for shipment overseas, the Butter (Wellington District) Marketing Regulations were brought into force on Ist May. Under those regulations the wholesale price of butter was fixed so that the returns to the dairy companies would be commensurate with the returns received for the butter and cheese purchased by the Government for export, after taking into consideration the disparity between the costs of packing and handling for export and those for the preparation of the product for the local market. A system of licensing wholesale distributors was also introduced, and the conditions under which they could trade in butter were clearly defined so that their margin of profit could be kept within reasonable limits and the interests of the dairy companies protected by the elimination of price-cutting and other undesirable practices. In addition, the dairy companies in the Wellington District were placed on a more satisfactory basis so far as the sale of their output for local consumption was concerned, and a number of anomalies that had hitherto existed between them, particularly in respect of their butterfat payments to the producers, were eliminated. The regulations have worked exceedingly smoothly and served admirably as groundwork for the inauguration of a similar plan on a national basis, which it is expected will be in operation towards the end of the year. Eggs and Egg-pulp. Since its inception the Internal Marketing Division has been actively engaged in assisting poultry-producers in the marketing of their produce, and has done a great deal of useful work in the handling and distribution of eggs and egg-pulp not only in Wellington, but also in other parts of the Dominion as well. During the flush period of production the Division relieved the markets in the various centres affected of their surplus supplies, and by co-ordinating the activities of the various distributors and egg-exporting committees was instrumental in stabilizing the markets concerned and ensuring to the producers more equitable returns. The Division has at the same time been investigating the possibility of improving the marketing of these products with a view to assisting the industry to develop the distribution of its produce throughout the Dominion on the most economical and efficient lines.

37

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wo Honey. The Division is also conducting an inquiry into the marketing of honey, and is investigating a number of proposals for reorganization which have been put forward by various interests throughout the Dominion. The problem of marketing honey internally is, however, accentuated by the fact that a considerable proportion of the crop has to be exported annually from the Dominion to maintain our market for this product overseas. It has therefore become necessary to consider the export position along with that of the local market. Fruit. Following upon the recommendation of the Fruit-marketing Committee, the Division assumed responsibility in May last for the supervision and reorganization of the marketing of fruit and vegetables within the Dominion. In addition to a considerable amount of preparatory work the Division has taken an active part in assisting growers with a number of the problems, and has in some instances arranged contracts for the disposal of their crops. The organization of the fruit industry has been under review, and in the case of the citrus industry a special growers' advisory committee representing the three co-operative associations at Kerikeri, Auckland, and Tauranga respectively has been co-opted to assist the Division in its endeavours to improve the marketing and distribution of New-Zealand-grown citrus fruits. Considerable attention has also been paid to the question of imported fruits, particularly oranges, with a view to ensuring that adequate supplies of this commodity would at all times be available to the public throughout the Dominion. The establishment of the Internal Marketing Division by the Government has had a considerable influence on the marketing within the Dominion of primary food products, and has created a position whereby the trade in these commodities can be, competently organized. It is the policy and function of the Division not only to investigate the possibilities of improving marketing procedure, but also to determine and, if necessary, initiate through its own organization those methods which are calculated to bring about a more efficient distribution of these products, and thus narrow the margin of cost between the producer and the consumer. Appreciation. In concluding the first report on the new marketing procedure, the Government desires to express its appreciation of the efforts of Mr. Frank Picot, the Director of Internal Marketing, and his staff, who, by their splendid work, are making orderly marketing possible in the Dominion; and to pay tribute to _ the untiring efforts of Mr. George A. Duncan, the Acting Director of Marketing, and his staff in New Zealand; and to Messrs. H. E. Davis and J. W. Rodden and their staff in London. They have carried through a major alteration in marketing without ostentation or advertisement that in the opinion of the Government will give the dairy-farmer and those associated with him a security that he has not previously possessed. Minister of Marketing.

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PRIMARY PRODUCTS MARKETING DEPARTMENT. CREAMERY BUTTER. Purchase and Sale Account, 1936-37 Season. Shipments for which Complete Sale Proceeds have been received at 31st July, 1937. Dr. £ s. d. Cr. .£ s. d. £ s. d. £ s. d Purchase of 3,955,212 boxes .. .. .. .. .. 11,601,452 17 10 Sale of 3,955,212 boxes (less United Kingdom selling-charges, including landing-charges, agents' commission, discount, and storage).. .. 11,468,626 17 2 Less— Freight .. .. .. .. 698,525 7 4 Insurance .. .. .. 20,232 0 4 718,757 7 8 10,749,869 9 6 Balance carried forward (deficit on 3,955,212 boxes) .. .. 851,583 8 4 £11,601,452 17 10 £11,601,452 17 10 Shipments for which only Partial Sale Proceeds have been received at 31st July, 1937. Dr. £ s. d. Cr. £ s. d. £ s. d. £ s. d Balance brought forward (deficit on 3,955,212 boxes .. .. .. 851,583 8 4 Sale of 884,418 boxes (less United Kingdom Purchase of .. .. .. 1,549, 036 boxes .. .. .. 4,554,110 11 10 selling-charges, including landing- charges, ,— agents'commission, discount, and storage) .. .. 2,931,661 17 9 5,504,248 boxes Estimated sale value of 664,618 boxes in store —i— . — United Kingdom or afloat at 31st July, 1937 (basis of valuation 115s. per hundredweight sterling, less United Kingdom selling-charges) .. 2,285,226 0 0 Total boxes, 1,549,036 .. .. .. 5,216,887 17 9 Less—Freight .. .. .. .. 282,415 7 11 Insurance .. .. .. .. 9,928108 292,343 18 7 4,924,543 19 2 Balance carried forward (estimated deficit on 5,504,248 boxes) .. 481,150 1 0 £5,405,694 0 2 £5,405,694 0 2

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PRIMARY PRODUCTS MARKETING DEPARTMENT— continued. CREAMERY BUTTER— continued. Purchase and Sale Account, 1936-37 Season— continued. Stocks in Store in New Zealand awaiting Shipment at 31st July, 1937. X) r . f s. d. | Cr. £ s. d. £ s. d. £ s. dBalance brought forward (estimated deficit on 5,504,248 boxes .. .. 481,150 1 0 Estimated sale value of 488,134 boxes (basis of Purchase value of .. .. .. 488,134 boxes .. .. 1,502,470 1 2 valuation 116s. per hundredweight sterling, less United Kingdon selling-charges) .. .. 1,686,807 14 6 Less— 5,992,382 boxes Freight .. .. .. .. 88,318 9 10 — ■ — Insurance .. .. .. .. 3,197 6 0 (149,809 tons 11 cwt.) 91,515 15 10 1,595,291 18 8 Balance carried forward (estimated deficit on 5,992,382 boxes), (149,809 tons 11 cwt.) .. .. .. .. . - .. •. • • 388,328 3 6 £1,983,620 22 £1,983,620 22 £s. d. _■£s. d. Balance brought forward .. .. .. .. •• •• 388,328 3 6 Balance to Dairy Industry Account (being estimated deficit on sale of creamery Estimated amount due to butter-manufacturing companies to preserve equity in butter) .. .. .. .. .. .. .. .. 561,397 1 6 respect of grading-dates of produce payable at the 1936-37 and the 1937-38 guaranteed prices .. .. -• •• •• 16,000 0 0 Amount due to Butter Box Pool Account (being refund Saranac Box deduction) .. 30,866 17 0 Proportion of administration and general expenses .. .. .. • • 126,202 1 0 £561,397 1 6 £561,397 1 6 (Note.—The produce unsold at balance date has since been realized at prices in excess of 116s. per hundredweight.)

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PRIMARY PRODUCTS MARKETING DEPARTMENT— continued. CHEESE. Purchase and Sale Acccount, 1936-37 Season. Shipments for which Complete Sale Proceeds have been received at 31st July, 1937. Dr. £ s. d. Or. £ s. d. £ s. d. £ s. d. Purchase of 678,831 orates .. .. .. .. .. .. 3,079,932 19 9 Sales of 678,831 crates (less United Kingdom selling-charges, including landing-charges, agents' commission, trade discount, and storage) .. .. .. .. •- 3,455,822 16 1 Less— Freight .. .. .. .. 369,496 1 0 Insurance .. .. .. .. 7,446 12 8 376,942 13 8 3,078,880 2 5 Balance carried forward (deficit on 678,831 crates) .. .. 1,052 17 4 £3,079,932 19 9 £3,079,932 19 9 Shipments for which only Partial Sale Proceeds have been received at 31st July, 1937. Dr. £ s. d. Or. £ s. d. £ s. d? £ s. d. Balance brought forward (deficit on 678,831 crates) ' .. .. .. 1,052 17 4 Sale of 209,46 1 -I- crates (less United Kingdom Purchase of .. .. .. 356,342 crates .. .. .. 1,604,651 17 9 selling-charges, including landing- charges, agents' commission, trade discount, and 1,035,173 crates storage) .. .. .. .. .. 1,280,043 7 0 - — Estimated sale value of 146,880J crates in store Balance carried forward (estimated surplus on 1,035,173 crates) .. .. 298,581 15 7 United Kingdom or afloat at 31st July, 1937 (basis of valuation 675. 6d. per hundredweight sterling, less United Kingdom selling-charges) .. 821,478 0 0 2,101,521 7 0 Total crates, 356,342. Less— Freight .. .. .. .. 192,458 17 10 Insurance .. .. .. .. 4,775 18 6 — 197,234 16 4 — 1,904,286 10 8 £1,904,286 10 8 £1,904,286 10 8

6—H. 30

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PRIMARY PRODUCTS MARKETING DEPARTMENT— continued. CHEESE —continued. Purchase and Sale Account, 1936-37 Season— continued. Stocks in Store in New Zealand awaiting Shipment at 31st July, 1937. Dr. £ s d. Cv Purchase value of 178,741 orates 867,880 "o 7 Balance brought forward (estimated surplus on 1,035,173 crates) £ d ' 298*581 lV 7 Balance carried forward (estimated surplus on 1,213,914 crates), (85,502 tons Estimated sale value of 178,741 crates (basis of ' " " ' 5 7 cw ' r '' "• •• •• •• •• •• 258,172 4 2 valuation 645. per hundredweight sterling, less United Kingdom selling-charges) .. Q23 622 1Q 8 Total crates, 1,213,914 (85,502 tons 10 cwt. 2 qr.). Less— £ s. d. Freight .. .. .. .. 94,162 19 6 Insurance .. .. .. .. 1,989 11 0 96,152 10 6 827,470 9 2 £1,126,052 4 9 £1,126,052 4 9 Estimated amount of further payment to cheese-manufacturing companies on Balance carried forward *o cheese graded up to and including 18th March, 1937, and exported on or before " " " " "' '" 08 ' 1 4 * 31st July, 1937 .. .. .. .. _ 165,000 0 0 Estimated amount due to cheese-manufacturing companies to preserve equity in respect of grading-dates of produce payable at the 1936-37 and the 1937-38 guaranteed prices .. .. .. .. .. .. 28,000 0 0 Proportion of administration and general expenses .. .. .. .. 46,817168 Balance to Dairy Industry Account (being estimated surplus on sale of cheese).. 7 6 £258 ' 172 £258,172 4 2 (Note.— The bulk of the produce unsold at balance date has since been realized at prices in excess of 675. 6d. per hundredweight.)

42

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PRIMARY PRODUCTS MARKETING DEPARTMENT— continued. WHEY BUTTER. Purchase and Sale Account, 1936-37 Season. Shipments for which Complete Sale Proceeds have been received at 31st July, 193 <. Dr £ B. d. Or. £ a. d. £ s. d. £ s. d. Purchase 0f'42,041 boxes 112,596 7 9 Sale of 42,041 boxes ((less United Kingdom sellingcharges, including landing-charges, agents commission, trade discount, and storage) .. .. 111,969 19 o Less— Freight .. .. •• •• 7 > 662 13 5 Insurance . . • • 193 9 7,85 6 8 2 104,113 11 4 Balance carried forward (deficit on 42,041 boxes) .. .. •• 8,482 16 5 £112,596 7 9 £113 ' 596 7 9 Shipments for which only Partial Sale Proceeds have been received at 31st July, 1937. Dr £ s. d. Or. £ s. d. £ s. d. £ s. d. Balance brought forward (deficit on 42,041 boxes) 8,482 16 5 Sale of 10,242 boxes (less United Kingdom seUmgPurchaseof .. .. 15,181 boxes 40,694 17 8 charges, including landing-charges, agents „7*7 12 10 commission, trade discount, and storage) .. .. «>1, 101 la iu 57 222 boxes Estimated sale value of 4,939 boxes in store United ' . Kingdom or afloat at 31st July, 1937 (basis of valuation 107s. per hundredweight sterling, less United Kingdom selling-charges) .. .. 15,770 0 0 Total boxes, 15,181 .. •• •• •• 47,527 12 10 Less— Freight 2,767 12 4 IllSUranCe 2,854 3 9 44,673 9 1 Balance carried forward (estimated deficit on 57,222 boxes) .. .. •• 4,504 5 0 £49,177 14 1 £49,177 14 1 Stocks in Store in New Zealand awaiting Shipment at 31st July, 1937. Dr £ s - Or. , Balance brought forward (estimated deficit on 57,222 boxes) 4,504 5 0 Estimated sale value of 200 boxes (basis of valuation 108s. per £ s. d. £ s d £ s. a. Purchase value of .. .. 200 boxes .. .. .. 562 4 11 hundredweight sterling, less United Kmgdom selling-charges) .. 644 0 0 Less— 57,422 boxes Freight .. .. .. •• •• 'tin Insurance .. .. .. •• * 0 u (1,435 tons 11 cwt.) 60 g g g Balance carried forward (estimated deficit on 57,422 boxes), (1,435 tons 11 cwt.) .. 4,460 4 2 £5,066 9 11 £5,066 9 11 £ s. d. £ s ' Balance brought forward .. .. .. .. •• •• •• 4,460 4 2 Balance to Dairy Industry Account (being estimated deficit on sale of whey butter).. 5,707 5 9 Proportion of administration and general expenses .. .. .. •. 1,247 1 7 £5,707 5 9 . £5 > 707 5 9 (Note.— IThe1The produce unsold at balance date has since been realized at prices in excess of 108s. per hundredweight.)

43

H.—3o,

PRIMARY PRODUCTS MARKETING DEPARTMENT— continued. Administration and General Expenses Account, 1936-37 Season.

44

United Kingdom. New Zealand. Total. a i • Dr ' £ s. d. £ s. d. £ s. d. Cr. -P „ LegaTexpenses " ! 10 'm 9 10 > 730 3 0 21 '300 13 6 Proceeds of export levy onjshipment of balance of 1935-36 main ' :ena ' Ilce ' cleaning » telephones, and sundry 3,531 12 6 2,263'l8 7 5,795 11 1 Allocation of expenses to produce "Purchase and " " 6 ' 262 15 2 Postage, cables, printing, and stationery 1,652 17 1 1,752 6 0 3,405 3 1 Creamery Gutter' ~ & I 1i Travelling-expenses 303 15 8 209 11 8 513 7 4 Whey butter 1 947 } 7 subscriptions, donations, entertainment, and general expenses.. 120 5 7 .. 120 o 7 rwL " " " " A n'Zii, nn L Shipping inspection 1,472 18 11 1,911 7 9 3,384 6 8 46,817 16 8 Agency expenses, Lyttelton .. .. .. .. .. 225 0 0 225 0 0 i/4,zt>b iy 3 Audit fees .. .. .. .. .. 650 0 0 650 0 0 Depreciation (office and departmental equipment) .. . . 238 17 9 221 1 2 459 18 11 18,002 2 9 17,963 8 2 35,965 10 11 • • £ s. d. Advertismg m United Kingdom .. ... .. .. .. _ 39,048 19 11 Premium credit risk insurance .. .. .. .. .. .. .. 6 206 6 3 • - 45 255 6 2 Miscellaneous general expenses .. .. .. .. .. .. ,, _ _ ' 779 5 3 Cost of remittances to dairy companies .. .. .. .. .. ..11 846 9 8 Interest on overdraft at Reserve Bank .. .. .. .. ,, .. 56 683 2 5 gg 529 19 1 Estimate of charges accruing on 1936-37 season's produce unsold at 31st July, 1937 .. .. 30,'000 Ō 0 £180,529 14 5 £180,529 14 5

H.—3o.

PRIMARY PRODUCTS MARKETING DEPARTMENT— continued. Dairy Industry Account (Income and Expenditure), Period Ist August, 1936, to 31st July, 1937. l Jr - £ s. d. Cr. £ s. d. £ s. d. Estimated deficit Creamery Butter Account .. .. .. .. 561,397 1 6 Estimated surplus Cheese Account .. .. .. 18,354 7 6 Less estimated deficit Whey Butter Account .. .. .. 5,70759 12,647 1 9 Estimated surplus cheese and whey butter .. .. .. .. 12,647 1 9 Balance (estimated deficit Dairy Industry Account, 1936-37 season) .. 548,749 19 9 £561,397 1 6 £561,397 1 6 Balance-sheet as at 31st July, 1937. Liabilities. £ s. d. £ s. d. Assets. £ s d £ s d Overdraft: Reserve Bank of New Zealand .. .. .. 3,998,118 1 5 Sundry debtors— Less balance at Bank of England and Bank of New Zealand, For produce and amounts accrued due .. .. .. 519,554 5 0 London .. .. .. .. .. .. 14,387 9 2 Internal Marketing Branch .. .. .. 37,569 18 3 3,983,730 12 3 557 124 3 3 Sundry creditors for accrued charges and sundry credit balances .. .. 2,863,794 5 3 Stocks— Produce .. .. .. .. .. .. 5,733,548 14 2 Advertising material and sundries .. .. .. 3,279 14 0 5,736,828 8 2 Office and departmental equipment .. .. .. .. .. 4 822 6 4 Dairy Industry Account (estimated deficit, 1936-37 season) .. .. .. 548,749 19 9 £6,847,524 17 6 £6,847,524 17 6 Notes. A. The following items of expenditure included in the accounts are being authorized in a Finance Bill to be submitted to Parliament during the present session: (1) Further payment of £165,000 to cheese-manufacturing companies. (2) Interest on overdraft, £56,683 2s. sd. (3) Payment of £30,866 17s. to the Butter-box Pool Account. (4) Advances to Internal Marketing Branch, £37,569 18s. 3d. (5) Additional amounts due on butter and cheese exported after 31st July, 1937, but paid for at the 1936-37 prices, pending the fixing of the 1937-38 prices. (Produce exported after 31st July, 1937, is payable at the 1937-38 prices). (6) Payment of £44,000 to dairy companies (£28,000 on account of cheese and £16,000 on account of butter) to preserve equity in respect of grading-dates for produce payable at the 1936-37 and the 1937-38 guaranteed prices. B. The effect of the validation of the items of expenditure mentioned in paragraphs (5) and (6) above is that the guaranteed prices fixed for the 1936-37 season apply to all export butter graded up to and including the 19th April, 1937, and to all export cheese graded up to and including the 18th March, 1937, and the guaranteed prices fixed ior the 1937-38 season apply to all butter and cheese graded after those respective dates. C. In order that the accounts should cover all export butter and cheese manufactured up to and including 31st July, 1937, the quantities in store in New Zealand at that date are included. Ownership of this produce passes to the Crown, in terms of the Primary Produces Marketing Act, when it is placed on board ship for export from New Zealand. G. A. DUNCAN, Acting Director of Marketing. I hereby certify that the Purchase and Sale Accounts, the Administration and General Expenses Account, the Income and Expenditure Account, and the Balancesheet have been duly examined and compared with the relative books and documents submitted for audit, and correctly state the position as disclosed thereby subject to the departmental notes enfaced thereon.— J. H. Fowler, Controller and Auditor-General.

45

H.—3o.

Imports of Butter into United Kingdom.

(a) Not separately distinguished before April, 1923. (&) Included in "Other Empire countries." (c) Included in Russia. (d) Included in Russia, Germany, and Austria-Hungary. (e) Included in " Other foreign countries."

Imports of Cheese into United Kingdom.

(a) Not separately distinguished before April, 1923. (6) Included in "Other foreign countries."

46

(From Dairy-produce Supplies, 1936.) Country whence consigned. 1913. 1931. 1932. 1933. 1934. 1935. 1936. Tons. Tons. Tons. Tons. Tons. Tons. Tons. New Zealand .. .. .. .. 12,600 96,300 106,930 125,600 133,850 131,900 139,600 Australia .. .. .. .. 29,700 77,900 89,750 84,600 105,200 105,650 84,700 Irish Free State .. .. .. (a) 19,050 15,750 18,950 23,400 24,400 23,400 Canada .. .. .. .. 50 3,900 950 1,650 .. 3,150 2,000 Union of South Africa .. .. .. .. 2,000 1,850 1,250 1,050 4,100 3,750 South-west African Territory .. .. .. 1,100 300 150 1,650 1,900 Kenya .. .. .. .. (b) 300 350 250 400 650 1,050 Nigeria .. .. .. .. .. .. ■ • • . .. 150 300 Other Empire countries. ....... .. 50 50 100 100 150 100 150 Denmark .. .. .. .. 85,350 123,300 129,200 125,950 124,300 109,300 108,550 Netherlands .. .. .. .. 7,650 4,800 2,350 7,300 15,050 23,200 37,300 U.S.S.R. (Russia) .. .. .. 37,550 20,200 16.150 28,150 24,550 25,150 20,750 Lithuania .. .. .. .. (c) 2,000 3,400 5,200 7,050 9,050 10,550 Latvia .. .. .. .. (c) 1,950 5,600 7,300 7,800 9,650 9,800 Poland .. .. .. .. (d) 1,650 150 .. 2,500 4,950 9,450 Finland .. .. .. .. (c) 12,700 10,850 6,700 7,550 5,800 8,000 Sweden .. .. .. .. 16,600 10,600 8,800 11,350 15,100 9,200 7,450 Estonia .. .. .. .. (c) 6,250 4,150 4,200 6,150 5,950 5,800 Austria .. .. .. .. .. .. .. 400 1,250 950 1,800 Hungary .. .. .. .. .. .. .. 1,600 2,000 900 1,750 France .. .. .. .. 12,450 50 100 50 750 350 1,450 Belgium .. .. . . .. (e) .. 50 100 700 . . 800 Germany .. .. .. .. .. 400 200 200 200 Norway .. .. .. .. 1,000 650 750 150 Argentina .. .. .. .. 3,650 18,700 19,550 10,100 5,550 3,450 7,150 Other foreign countries .. .. .. 300 250 100 150 50 750 150 Totals, Empire countries .. 42,400 199,500 216.800 232,700 264,200 271,750 256,850 Totals, foreign countries .. 164,550 203,500 201,400 208,900 220,550 208,650 230,750 Totals, all countries .. .. 206,950 403,000 418,200 441,600 484,750 480,400 487,600

(From Dairy-produce Supplies, 1936.) Country whence consigned. 1913. 1931. 1932. 1933. 1934. 1935. 1938. Tons. Tons. Tons. Tons. Tons. Tons. Tons. New Zealand .. .. .. .. 27,350 86,650 92,450 102,950 104,600 88,150 84,050 Canada .. .. .. .. 64,700 35,350 37,350 31,500 26,000 23,500 30,150 Australia .. .. .. .. 400 3,400 3,700 4,650 5,750 6,700 4,550 Union of South Africa and South-west African .. 750 850 650 150 1,100 600 Territory Irish Free State .. .. .. (a) 100 100 50 250 450 850 Other Empire countries .. .. .. .. .. .. .. . . .. 50 Netherlands .. .. .. .. 14,600 8,400 8,500 6,100 6,400 9,950 9,100 Italy .. .. .. .. 5,100 6,600 5,300 4,500 4,700 4,000 700 Denmark .. .. .. .. (b) 250 300 300 300 500 1,450 France .. .. .. .. 750 600 450 350 350 400 1,150 Switzerland .. .. .. .. 600 1,600 700 700 700 750 850 Finland .. .. .. .. (b) 150 150 100 100 100 50 Norway .. .. .. .. (b) 50 100 50 100 50 50 Belgium .. . . .. .. 100 100 50 50 .. .. 50 Germany .. .. .. .. (b) 50 50 United States of America .. .. 1,100 200 .. .. .. .. 50 Other foreign countries .. .. .. 150 50 100 50 50 50 100 Totals, Empire countries .. 92,450 126,250 134,450 139,800 136,750 119,900 120,250 Totals, foreign countries .. 22,400 18,050 15,700 12,200 12,700 15,800 13,550 Totals, all countries .. .. 114,850 144,300 150,150 152,000 149,450 135,700 133,800

H.—3o,

Imposts of Butter into Ports in the United Kingdom, 2nd July, 1936, to 30th June, 1937. (In tons.) Weekly Dairy Produce Notes, Imperial Economic Committee.

47

Country whence consigned. London. s °uthamp- Bristol. Fishguard. Liverpool. Manchester. Glasgow. Leith. | Newcastle. Hull. Goole. Grimsby. Harwich. Other Ports. Total. P y^ US Irish Free State .. .. .. 100 6,200 6,400 .. 4,950 .. .. .. .. .. .. 3 350 21 000 23 900 Australia .. .. .. 65,900 50 100 .. 2,400 650 950 .. .. 1,100 .. .. .. ' 71* 150 88'100 New Zealand .. .. 105,300 900 8,800 .. 18,400 1,700 9,450 .. 50 100 .. .. !. *200 144*900 136*850 Canada .. .. .. 750 .. .. .. 300 150 .. .. 150 .. .. .. .. .. 1*350 3 350 South-west African Territory .. .. 1,650 .. .. .. .. .. .. 19 south Africa .. .. 700 2,950 .. .. .. ;; ;; ;; ;; ;; ;; ;; ;; 3 ; 650 5 ; 600 • • • • • • 900 • • • • ■ • • • • • • • • • • • • • • • .. .. .. 900 950 -Nigeria • • • ■ • ■ 100 .. .. .. .. .. .. .. .. .. .. .. ,. .. 100 250 British India .. .. .. .. .. .. .. ., .. .. .. .. .. .. ;; ;; Other Empire countries .. 150 50 .. .. .. .. .. . . .. .. ' ' ' 200 50 Russia .. .. .. 20,750 .. .. .. .. .. .. .. . . # # _ 20,750 17,950 Netherlands .. .. 17,500 .. .. .. 1,350 750 50 7,250 2,450 4,250 4,100 50 150 1,400 39'300 29^400 Denmark .. .. .. 350 .. .. .. .. .. .. 22,200 23,550 7,200 5,300 41,600 13,550 .. 113,750 108,000 Sweden .. .. .... 150 .. .. .. .. .. .. 1,350 1,600 5,300 .. .. .. 300 8,700 8,200 Finland .. .. .. .. .. .. .. .. .. 10 o .. 8,750 .. .. .. .. 8,850 6,450 •' '• J >850 •• .. .. .. .. .. .. .. 4,800 .. .. .. .. 6,650 6,150 Latvia .. .. .. 8,450 .. .. .. .. .. .. 100 1,050 800 .. .. .. .. 10,400 9,850 j* nd . " " '• ®'150 .. .. .. .. .. .. .. .. 700 .. .. .. .. 6,850 7,750 Lithuania .. .. .. 8,200 .. .. .. .. .. .. 50 .. 1,750 .. .. .. .. 10,000 10,550 Uermany .. .. .. 50 .. .. .. .. .. .. .. . # 50 Austria .. .. .. 1,800 ,. .. .. .. .. .. .. .. ... .. .. .. ;; 1 800 i^iso Hungary !'600 .. .. .. .. .. .. .. .. .. .. .. .. .. 1,600 1,200 Belgium 600 .. .. .. .. .. ... .. .. . . .. .. .. .. 600 300 France .. .. .. .. 1,100 .. .. .. .. .. .. .. .. .. ,. .. 100 j 2 00 850 Jtiumania .............. iaa U.S.A ;; ;; ;; ;; ;; ;; ;; ;; ;; ;; Argentina .. .. .. 6,400 2,400 .. .. 50 .. .. .. . 8 850 4 000 Other foreign countries .. 50 .. .. .. .. .. .. 50 .. 50 .. .. .. 2,250 2,'400 4^000 Totals .. .. 247,700 9,100 9,000 6,200 28,900 3,250 15,400 31,100 28,850 34,800 9,400 41,650 13,700 7,600 486,650 ~ 27th June, 1935, to 1st July, 1936 252,400 9,650 7,800 7,150 25,050 | 5,550 ) 16,650 ; 28,900 26,350 27,950 9,000 38,500 13,600 9,500 .. 478,050

H.—3o

Imports of Cheese into Ports in the United Kingdom, 2nd July, 1936, to 30th June, 1937. (In tons.) Weekly Dairy Produce Notes, Imperial Economic Committee.

48

Country whence consigned. London. Folkestone. Southamp- Bristol. Cardiff. Liverpool. Manchester. Glasgow. | Leith. Newcastle. Hull. Goole. Harwich. Other Ports. Total. 8 Irish Free State .. .. 50 .. .. .. .. 250 .. 50 .. .. .. .. .. 600 950 500 New Zealand .. .. 61,550 .. 350 4,900 200 7,300 650 4,250 .. 50 50 .. .. .. 79,300 85,050 Canada .. .. 15,150 .. 50 2,450 1,150 2,750 950 1,150 850 1,250 450 .. .. 1,150 27,350 22,200 Australia . . .. .. 4,600 .. .. 700 .. 50 .. .. .. .. 200 .. .. .. 5,550 5,450 South Africa .. .. 150 .. 600 .. .. .. .. •• .. .. 750 1,050 Netherlands.. .. .. 5,850 .. .. .. .. 100 .. .. 850 500 600 2,050 150 400 10,500 9,100 Italy .. .. .. 1,250 450 .. .. .. .. .. .. .. .. .. .. 500 50 2,250 1,650 Switzerland .. .. 400 50 .. .. . • • • • - • • 50 .. .. . . 200 100 800 600 Denmark .. .. .. 250 .. .. .. .. .. .. .. 50 100 50 .. 550 50 1,050 1,200 France .. .. .. 150 .. 100 .. .. .. .. .. .. .. .. .. 200 400 850 800 Finland .. .. .. 150 .. .. .. .. • • • ■ .. .. ■. . ■ ■. .. . ■ 150 100 Norway .. .. .. 50 . . .. .. .. ■ • ■. .. .. .. . ■ ■ ■ ■ ■ . ■ 50 50 Argentina .. .. .. 50 .. .. .. .. . ■ ■. .. .. .. .. . ■ ■. . ■ 50 50 Other countries .. .. 50 .. .. .. .. .. .. .. .. .. ■■ 2,650 2,700 4,700 Totals.. .. .. 89,700 500 1,100 8,050 1,350 10,450 1,600 5,450 1,800 1,900 1,350 2,050 1,600 5,400 132,300 27th June, 1935, to 1st July, 1936 90,950 750 1,350 7,700 1,450 9,100 2,200 4,750 1,900 1,400 1,150 1,300 1,550 6,950 .. 132,500

H,— 3o,

THE WORLD TRADE IN BUTTER. Export of Butter from Principal Exporting Countries.

Imports of Butter into Principal Importing Countries.

7-11. 30.

49

(In tons.) Countries, 1936. 1935. 1934. 1933. 1932. 1931. 1930. 1929. Denmark .. 143,896 136,116 147,460 148,334 155,306 168,942 166,321 156,526 Netherlands .. 59,235 46,047 36,304 27,925 20,056 32,438 41,247 46,574 Irish Free State 25,907 26,549 25,396 20,193 16,488 18,887 26,235 28,034 Sweden .. 18,806 19,939 22,836 16,857 13,333 19,217 26,253 24,536 Finland .. 13,766 10,081 10,923 11,697 14,295 17,128 16,842 16,344 Estonia .. 10,782 9,958 9,079 12,333 14,216 13,844 12,164 Latvia .. 17,017 16,550 15,453 15,399 18,304 18,443 18,139 14,596 Lithuania .. 14,398 11,962 9,518 9,429 9,770 8,567 7,241 4,020 Poland.. .. 10,735 5,595 4,367 1,583 1,208 12,263 11,926 14,843 France .. 5,660 5,181 3,258 3,049 3,536 4,931 5,404 7,466 Totals, Europe 320,202 288,687 285,473 263,545 264,629 315,032 333,452 325,103 U.S.S.R. .. 22,732 28,929 37,305 36,617 30,446 30,368 10,356 24,971 New Zealand .. 139,810 139,466 130,725 131,760 109,277 99,428 94,212 82,690 Australia .. 82,889 102,898 110,171 94,434 102,258 85,275 45,944 Argentina .. 10,107 6,753 8,191 13,688 24,963 22,842 16,762 Canada .. 2,290 3,436 191 1,981 1,565 4,768 527 625 Totals, overseas 235,096 252,553 249,278 241,863 238,063 212,313 174,095 146,021 Grand totals .. 578,030 570,169 572,056 542,025 533,138 557,713 496,095

(In tons.) Countries. j 1936. 1935. 1934. 1933. 1932. 1931. 1930. 1929. 1928. Great Britain and 484,030 474,060 479,808 437,300 402,947 385,429 332,531 313,727 297,423 Northern Ireland Germany .. 74,216 69,879 60,788 58,210 68,421 98,638 131,054 133,404 124,555 Belgium - Luxem- 3,634 5,943 9,238 12,235 20,950 18,554 10,105: 4,267 1,294 burg Prance .. 1,898 674 4,287 9,066 11,670 18,230 5,770 4,354 2,571 Switzerland .. 1,439 135 292 511 3,639 10,428 8,392; 7,433 8,064 Canada .. 53 66 1,283 615 106 1,260 17,234 16,040 7,500 U.S.A... .. 4,407 10,123 561 247 194 462 601 642 1,545 Totals .. 569,677 560,880 556,257 518,184 507,927 533,001 505,687 479,867 442,952 1 : ' i ■ . 1

H.—3o,

BUTTER. Weekly Medium Prices at the London Provision Exchange.

50

(Shillings per hundredweight.) 1934-35. 1935-36. 1936-37. I J i 4 S 4 !' zi ! si I 4 4 & 4 | I si ! 4 4 2 4 i Date - gl I gfj § i £ 3 =g 1 Date - «1 I §| S 1 | 1 § s Dat<! - si & l| § I I 3 i 1 ,§3®®S > Q f:| MP«J j < | < <! <1 <1 S.F. S.F. S. U.F. U.S. S. U.S. S ianī" S.F. S.F. S. U.F. U.S. S. U.S. S.F. S.F. S. U.F. U.S. S. U.S. S ianf" Oct. 5 .. 68 68 .. ..106 71 60 54 61 Oct, 4 .. 118 116 112 .. 129 105 106 99 109 Oct. 2 .. 103 104 .. 94 125 97 .. .. 97 12 .. 65 65 .. ..107 71 59 56 61 11 .. 124 123 115 .. 132 111 113 109 119 9 .. 101 101 .. 94 126 95 .. 82 93 19 .. 67 65 .. .. 112 71 61 .. 61 18 .. 125 123 .. .. 136 123 120 115 120 16 .. 95 96 .. .. 121 90 .. 81 88 26 .. 70 69 .. ..120 71 67 60 64 25 .. 114 113 .. .. 130 123 .. 107 113 23 .. 96 96 .. 90 120 .. 82 .. 88 Nov. 2 .. 72 71 .. ..124 79 71 .. 66 Nov. 1 .. 106 105 .. .. 124 112 .. 99 102 30 .. 99 98 .. .. 119 91 .. 84 91 Nov. 9 .. 77 76 .. .. 124 85 74 69 73 Nov. 8 .. 101 100 95 .. 124 106 100 94 97 Nov. 6 .. 108 107 . . .. 125 98 .. 88 99 16 .. 75 74 .. ..121 87 74 67 .. 15 .. 103 101 .. .. 124 109 102 96 98 13 .. 109 108 105 .. 125 103 .. 94 101 23 .. 74 73 .. .. 117 90 73 66 71 22 .. 103 102 96 .. 123 108 102 96 100 20 .. 109 108 105 .. 120 101 .. 94 99 30 .. 72 70 .. .. 116 96 72 .. 70 29 .. 98 97 94 .. 125 105 .. 94 .. 27 .. 106 105 102 .. 119 98 .. 93 96 Dec. 7 .. 72 70 .. . . 123 96 71 .. 69 Dee. 6 .. 92 91 89 .. 127 101 .. 88 90 Dec. 4 .. 104 102 98 97 118 98 .. .. 94 14 .. 69 68 .. 69 126 98 13 . . 87 86 .. 94 127 95 .. .. 87 11 . . 104 101 98 95 117 98 .. .. 95 21 . . 70 70 .. 70 122 105 20 .. 89 88 .. 91 128 95 18 .. 99 97 .. 94 111 96 .. .. 94 28 .. 75 74 .. 72 121 27 .. 99 98 .. 96 128 99 23 .. 94 93 .. 91 110 .. .. 91 91 Jan. 4 .. 76 75 .. .. 120 Jan. 3 .. 99 98 .. 96 128 99 Jan. 1 . . 94 94 . . 90 109 93 96 .. 92 11 83 81 .. .. 116 113 103 .. .. 10 .. 96 95 .. 97 122 102 8 .. 98 98 95 92 110 97 .. 93 96 18 .. 80 80 .. .. 118 113 17 .. 92 91 87 97 115 99 .. 89 ... 15 .. 95 95 93 92 111 97 .. 93 94 25 . . 84 82 .. .. 116 111 24 .. 91 90 .. 96 115 96 .. 87 .. 22 .. 93 93 90 90 113 96 .. 89 92 Feb. 1 .. 88 87 85 .. 118 109 31 .. 94 93 .. 96 116 99 .. 89 .. 29 .. 89 88 86 89 119 97 .. .. 88 Feb. 8 .. 90 89 .. 94 120 105 100 .. .. Feb. 7 .. 96 95 92 95 125 101 .. 92 .. Feb. 5 .. 87 87 .. 87 122 99 .. 86 88 15 .. 89 88 .. 92 115 105 94 .. .. 14 . . 95 95 .. 96 127 105 .. 94 .. 12 .. 85 85 82 87 122 100 .. .. 87 22 .. 84 83 .. ..112 103 94 83 .. 21 .. 92 92 90 96 128 107 .. 91 .. 19 83 83 81 ..116 99 .. .. 84 Mar. 1 . . 81 80 .. .. 112 92 90 79 .. 28 .. 88 87 85 94 135 102 .. 86 .. 26 .. 88 88 .. 85 117 98 .. .. 87 Mar. 8 .. 75 75 .. .. 107 87 77 .. .. Mar. 6 .. 86 86 83 89 129 95 .. 85 .. Mar. 5 .. 89 90 87 87 121 99 .. .. 89 15 .. 73 71 .. .. 104 79 13 .. 85 84 .. 86 121 89 .. 82 .. 12 .. 97 96 93 91 128 99 .. .. 94 22 .. 72 70 .. . . 101 73 20 .. 80 80 77' 83 121 85 .. 80 .. 19 .. 98 98 96 92 128 102 29 .. 75 73 .. 73 102 73 27 .. 83 83 79 82 115 83 .. 80 26 .. 100 100 97 92 127 101 April 5 .. 77 74 .. 74 100 72 77 .. .. April 3 .. 87 86 83 87 110 86 .. 84 .. April 2 .. 99 99 .. 93 118 97 12 .. 78 74 . . 73 98 78 78 .. .. 10 .. 88 88 .. .. 108 87 .. 85 .. 9 .. 102 101 .. 92 114 97 19 .. 76 71 .. .. 98 81 80 . . .. 17 .. 86 86 83 .. 102 85 .. 85 .. 16 .. 106 105 102 .. 115 103 .. .. .. 26 . . 76 72 68 73 95 71 75 .. 70 24 .. 88 87 84 .. 103 86 .. 83 .. 23 .. 108 107 104 | 102 112 1 105 .. .. I ..

H.—3o

51

May 3 .. 78 75 \ 71 73 91 73 73 .. 71 May 1 .. 87 87 84 .. 100 86 .. 83 .. AprU 30 .. 108 107 104 .. 115 107 10 .. 77 75 70 73 89 73 73 .. 70 8 .. 88 88 .. . . 100 85 86 82 87 May 7 .. 104 102 99 ,. 109 99 105 .. 101 17 .. 77 75 .. 71 89 71 71 . . 69 15 . . 94 93 .. .. 102 87 .. 83 90 14 .. 107 106 103 .. 108 102 105 24 .. 80 79 .. 72 97 73 73 .. 73 22 .. .97 96 .. ..108 91 .. 89 96 21 .. 108 107 .. .. 110 104 107 31 .. 81 80 .. .. 98 78 77 .. 75 29 .. 103 100 97 ..110 97 .. 93 99 28 .. 108 107 105 .. 114 105 June 7 .. 83 82 76 .. 98 75 76 72 77 June 5 .. 106 104 .. .. 112 101 101 97 .. June 4 .. 110 109 .. 104 114 106 14 .. 86 84 79 .. 101 77 76 74 79 12 .. Ill 110 .. .. 118 108 107 103 .. 11 .. 110 108 106 .. 114 106 108 21 .. 89 86 82 .. 102 80 80 76 83 19 .. 107 106 104 .. 114 106 104 99 .. 18 .. 110 109 107 . . 115 107 108 106 28 .. 89 86 84 .. 102 82 83 77 84 26 .. 105 104 102 .. 117 101 95 99 .. 25 .. 109 107 .. . . 115 107 .. 104 July 5 .. 88 85 83 .. 99 83 81 75 82 July 3 .. 107 106 101 .. 117 99 99 93 .. July 2 .. 109 106 .. .. 115 106 .. 103 105 12 .. 89 86 82 .. 99 83 81 74 83 10 .. 113 112 .. 103 124 106 108 99 107 9 .. 110 109 .. . . 115 106 .. 105 19 .. 89 86 81 .. 102 83 82 75 82 17 .. 116 115 .. 105 127 110 111 105 111 16 .. 115 113 .. .. 122 109 111 108 26 .. 92 90 .. .. 108 84 85 78 87 24 .. 118 116 .. 107 127 110 112 107 111 23 .. 116 115 .. .. 124 112 113 112 Aug. 2 .. 93 92 .. ..110 87 88 82 88 31 .. 116 115 .. 106 125 108 110 105 110 30 .. 118 117 .. .. 124 112 115 Aug. 9 .. 93 93 89 .. 109 90 90 84 89 Aug. 7 .. 117 115 .. 105 125 109 109 104 109 Aug. 6 16 .. 94 93 .. ..108 87 89 84 87 14 .. 118 117 .. 109 127 111 110 105 110 13 23 .. 94 93 .. ..109 85 88 82 86 21 .. 121 120 .. 108 128 112 113 107 112 20 30 .. 97 96 92 .. 114 86 89 82 87 28 .. 119 118 .. 110 128 110 112 107 112 27 Sept. 6 .. 104 103 .. .. 119 94 93 86 96 Sept. 4 .. 114 114 .. 107 128 108 108 102 109 Sept. 3 13 .. 112 111 .. .. 128 100 99 95 100 11 .. 109 108 .. 101 128 103 104 92 105 10 20 :. Ill 110 107 .. 129 106 98 94 98 18 .. 105 105 .. 96 124 101 .. 87 102 17 27 .. 115 114 111 .. 129 105 101 96 103 25 .. 99 99 .. 91 120 97 96 80 94 24 . !! '' " S.F. = Salted finest; S. = Salted; U.F. = Unsalfced finest; U.S. = Unsalted.

H.—3o.

CHEESE. Weekly Medium Prices at the London Provision Exchange.

52

(Shillings per hundredweight.) 1934-35. 1935-36. 1936-37. New Zealand. Canadian. English. New Zealand. Canadian. English. New Zealand. Canadian. English. Date. Date. 7 Date. W.F. C.F. W.F. C.F. Farmers j aetory W.F. C.F. W.F. C.F. Farmers j. actory wr _ 0 F w.F. C.F. Farmers j. actory _ I Nov. 9 .. 54 53 54 55 85 47 Nov. 8 .. 50 50 57 57 68 .. Nov. 6 .. 72 68 70 68 84 67 16 .. 52 52 55 55 85 .. 15 .. 51 51 58 60 75 48 13 .. 74 72 73 71 85 67 23 .. 50 48 55 55 85 .. 22 .. 53 54 58 58 77 47 20 .. 73 72 73 72 85 66 30 .. 47 46 55 55 85 .. 29 .. 53 55 57 58 77 49 27 .. 68 68 72 71 85 66 Dec. 7 .. 45 44 55 55 86 44 Dec. 6 .. 52 53 58 58 77 45 Dec. 4 .. 62 62 71 71 87 62 14 .. 44 43 55 55 86 43 13 .. 52 55 57 58 77 43 11 .. 64 64 71 71 87 61 21 .. 44 44 55 55 86 .. 20 .. 55 59 59 60 77 49 18 .. 63 63 71 70 87 62 28 .. 46 46 55 56 86 .. 27 .. 56 60 59 63 75 46 23 .. 60 60 71 71 87 59 Jan. 4 .. 47 47 56 58 86 .. Jan. 3 .. 58 62 60 63 75 47 Jan. 1 .. 57 57 71 71 87 56 11 . . 48 48 59 59 86 45 10 .. 56 60 60 62 75 49 8 .. 58 58 71 71 86 56 18 .. 46 46 58 58 86 44 17 .. 54 57 60 62 75 50 15 .. 56 56 69 71 86 62 25 . . 46 46 58 58 86 43 24 .. 52 55 60 62 75 52 22 .. 53 53 71 71 87 Feb. 1 .. 47 47 59 59 86 44 31 . . 53 57 60 62 75 52 29 .. 51 51 72 72 87 53 Feb. 8 .. 48 47 59 59 86 44 Feb. 7 .. 53 58 59 60 75 51 Feb. 5.. 51 51 72 72 87 53 15 .. 49 49 60 61 86 42 14 .. 53 57 61 63 75 51 12 .. 53 52 71 71 87 52 22 .. 48 47 60 61 86 44 21 .. 51 55 61 62 75 52 19 .. 52 51 71 71 87 Mar. 1 .. 46 46 61 61 86 44 28 .. 50 54 62 63 75- 51 26 .. 54 54 71 71 87 50 Mar. 8 .. 45 46 61 61 86 43 Mar. 6 ., 49 53 62 63 75 52 Mar. 5 .. 55 56 71 71 87 50 15 .. 44 45 61 61 86 .. 13 .. 51 53 62 63 75 52 12 .. 59 59 71 71 87 22 .. 45 46 61 61 86 43 20 .. 49 51 60 64 77 50 19 .. 64 64 73 73 89 29 .. 46 47 61 61 86 42 27 .. 50 51 61 63 79 49 26 .. 63 63 73 73 89 66 April 5 .. 45 47 61 61 86 42 April 3 .. 52 53 61 64 79 50 April 2 .. 66 66 74 74 89 12 .. 45 46 61 61 86 41 10 .. 53 53 61 64 80 49 9 .. 66 66 74 74 92 19 .. 44 46 61 61 86 41 17 .. 53 53 61 63 83 50 16 . . 69 69 75 75 92 26 .. 44 46 61 61 86 41 24 . . 54 54 62 64 83 51 23 .. 69 69 75 75 92 May 3 .. 43 45 61 61 86 41 May 1 . . 55 54 64 65 83 51 30 .. 70 70 77 77 92 May 10 .. 44 45 61 63 86 40 May 8 .. 56 55 63 65 83 51 May 7 .. 70 70 77 77 92 17 .. 44 45 62 61 86 40 15 .. 58 55 63 65 .. 53 14 .. 72 72 77 77 24 .. 43 44 63 62 86 40 22 .. 58 55 65 65 .. 52 21 .. 73 73 77 77 31 .. 43 44 63 63 86 39 29 .. 58 56 64 65 .. 53 28 .. 74 74 78 77 June 7 .. 43 44 63 63 86 39 June 5 .. 59 58 65 65 .. 54 June 4 .. 74 74 79 79 14 .. 44 44 63 63 86 40 12 .. 61 61 66 66 .. 58 11 .. 74 74 79 79 98 21 .. 45 44 63 62 86 38 19 .. 60 60 66 66 .. 57 18 .. 74 74 79 79 28 .. 45 45 63 64 86 39 26 .. 58 58 67 65 .. | 56 25 .. 74 73 79 79 .. 71

H—3o.

53

July 5 .. 45 45 63 63 .. 35 July 3 .. 58 58 68 .. .. 56 July 2 .. 72 71 79 .. .. .. 12 44 44 63 63 . . 35 10 .. 60 60 63f 69* 63f 66* .. 55 9 .. 71 69 78 78 .. 70 19 " 44 44 63 63 .. 35 17 .. 62 62 64+ 69* 64f 70* .. 57 16 .. 72 70 .. .. .. 69 26 44 44 63 63 56 35 24 .. 63 62 72* 64f 70* .. 58 23 .. 74 72 73f 80* 72f 80* .. 73 Aug. 2 45 45 63 63 56 35 31 ,. 62 61 64f 75* 64f .. 72 59 30 .. 75 72 74f 80* 73f 80* .. 73 Aug. 9 .. 48 47 64* 51f 62* 51f 60 36 Aug. 7 .. 63 62 64 64 72 58 Aug. 6 .. 16 .. 48 47 64* 51f 63* 51f 60 37 14 .. 68 65 67 67 74 61 13 .... 23 . . 49 49 64* 52+ 65* 52f 60 37 21 .. 70 67 69 . . 78 65 20 .. 30 .. 50 49 61* 53j" 62* 53f 60 3*6 28 .. 72 67 68 71 78 67 27 .. Sept. 6 .. 51 51 53 52 63 39 Sept. 4 .. 70 67 69 71 78 67 Sept. 3 .. 13 54 54 54 54 63 42 11 .. 69 67 71 69 79 64 10 20 .. 55 55 55 56 63 43 18 .. 67 66 70 70 79 64 17 27 .. 58 58 58 59 65 43 25 .. 67 65 69 69 79 64 24 Oct 4 59 59 59 60 65 47 Oct. 2 .. 70 67 69 69 82 64 Oct. 1 .. 11 61 61 61 61 65 54 9 .. 70 66 69 69 83 63 8 .. .. 18 61 61 61 61 65 53 16 .. 68 65 68 68 82 63 15 25 .. 58 58 60 60 67 52 23 .. 71 66 70 69 84 64 22 Nov. 1 . . 52 52 59 59 68 49 30 .. 71 67 70 69 84 66 29 .. * Old season's. t New. W.F. = White finest; C.F. = Coloured finest.

H,— 3o,

THE WORLD TRADE IN CHEESE. Exports of Cheese from Principal Exporting Countries.

Imports of Cheese into Principal Importing Countries.

Approximate Cost of Paper.—Preparation, not given ; printing (2,560 copies, including graphs and illustrations), £125.

By Authority: E. V. Paul, Government Printer, Wellington—l 937. Price Is. 3d.]

54

(In tons.) Countries. 1936. 1935. j 1934. 1933. 1932. 1931. 1930. 1929. Netherlands .. 55,942 60,088 60,220 62,903 75,921 85,025 92,294 94 302 Ital y •• •• 19,096 17,805 24,680 23,562 29,700 39,708 36,150 32,054 Switzerland .. 18,186 17,968 17,475 20.244 19,509 24,244 29,528 31 127 Fra nce .. 10,422 10,994 11,595 11,176 13,042 15,308 17,375 18 129 Denmark .. 9,379 6,558 6,201 9,920 6,488 4,188 5,636 6 479 New Zealand .. 82,911 86,378 99,226 99,146 89,520 81,818 90,648 88 954 Canada .. 36,558 24,876 27,307 33,111 38,812 37,853 35,787 41 495 Australia .. 5,550 6,845 5,565 4,864 3,929 3,309 3,242 2,291 Totals .. 238,044 231,512 252,269 264,926 276,921 291,453 310,660 314,831

(In tons.) Countries. 1936. | 1935. 1934. 1933. 1932. 1931. j 1930. 1929. Great Britain and 132,600 134,222 147,918 150,783 148,712 142,820 154,118 148,100 Northern Ireland Germany .. 27,458 27,527 33,254 40,591 48,522 53,752 61,366 65,432 Belgium .. 22,695 22,645 21,173 21,615 20,384 22,143 22,815 20,740 France 14,508 15,539 15,692 20,583 23,334 36,968 29,249 22,800 U - S - A - •• 26,718 21,846 21,220 21,606 24,830 27,674 30,496 34,096 Totals .. 223,979 221,779 239,257 255,178 265,782 283,357 298,044 291,168

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Bibliographic details

H-30 PRIMARY PRODUCTS MARKETING DEPARTMENT ANNUAL REPORT AND ACCOUNTS FOR THE YEAR ENDED 31st JULY, 1937., Appendix to the Journals of the House of Representatives, 1 January 1937

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25,037

H-30 PRIMARY PRODUCTS MARKETING DEPARTMENT ANNUAL REPORT AND ACCOUNTS FOR THE YEAR ENDED 31st JULY, 1937. Appendix to the Journals of the House of Representatives, 1 January 1937

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