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1948 NEW ZEALAND

MILK MARKETING DIVISION REPORT OF THE DIRECTOR OF MILK MARKETING FOR THE PERIOD ENDED 31st AUGUST, 1947

Presented to Both Houses of the General Assembly Pursuant to the Provisions of the Marketing Act, 1936

The Director of Milk Marketing to the Hon. the Minister of Marketing*. Wellington, 25th August, 1948. I have the honour to present herewith, pursuant to the provisions of the Marketing Act, 1936, a report of the operations of the Milk Marketing Division for the period ended 31st August, 1947. I have, &c., H. H. Innes, Director of Milk Marketing. The Hon. the Minister of Marketing.

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REPORT 1. Fixation of National Town Milk Producer Price, 1946-47 Milk Year For the milk year commencing Ist September, 1946, and terminating on 31st August, 1947, the national town milk price was fixed at the level of 15* 63d. per gallon, which represented an increase of 0-78 d. per gallon on the previous year's price of 14*85 d. This increase represented the town milk equivalent of the increase to the guaranteed price for dairy-farmers of 0-52 d. per pound butterfat on account of higher labour reward and 0-761 d. per pound butterfat representing increased working and maintenance costs. This average price of 15-63 d. was, in consultation with the Town Milk Producers' Federation of New Zealand, divided into the following seasonal differentials : Per Gallon, d. Summer period (September to January inclusive) .. ..12-75 Autumn period (February to April inclusive) .. .. 15 Winter period (May to August inclusive) .. .. .. 20-36 These prices were payable to approved producer organizations in respect of the full nominated quantity plus agreed surpluses if produced, or actual town milk sales, whichever were the greater. 2. Further Extension of the National Milk Scheme to Cover Payment for Additional Surplus Milk During the 1945-46 milk year, payment of surplus over and above the nominated quantity to the extent of 10 per cent, was recognized. On behalf of milk producers, however, their federation claimed that this surplus factor was particularly inadequate as far as the summer period was concerned, when a flush of production was inevitable. After consultation between the Minister of Marketing and the federation, it was agreed that the surplus factor for the summer period be increased to 17 per cent., the autumn and winter periods remaining at 10 per cent. 3. Terms of Agreement Between the Minister of Marketing and the Town Milk Producers' Federation of New Zealand The terms of the agreement entered into between the Minister of Marketing and the Town Milk Producers' Federation of New Zealand covering the operation of the National Milk Scheme for the 1946-47 year was broadly on the same basis as that operative during the previous year and published in detail in the first annual report of this Division. The only major alterations for this year included the provisions to recognize the increase in the surplus milk factor to 17 per cent, for the summer period and to pay for any surplus milk produced in the winter period at the average price of 15-63 d. per gallon. 4. Basis of Bealization for Surplus Milk Diverted for Dried Milk, Cheese, or Butter Manufacture After consultation with the Town Milk Producers' Federation it was agreed that in respect of the 1946-47 milk year the credit on surplus milk to be given to the Government on quantities diverted to dried milk, cheese, or butter manufacture were to be on the following basis : Per Gallon, d. For dried milk .. .. .. .. .. 9• 1 For cheese .. .. .. .. .. 8-75 For butter .. .. .. .. ..7*85 All prices to be credited as at the farm gate.

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5. List of Town Milk Producer Organizations, Together with Daily Nominated Quantities Approved by the Minister of Marketing in Respect of the 1946-47 Milk Year

6. Fixation of Processing and Distributive Margins The national milk margins covering pasteurization, chilling, bottling, and wholesale and retail distribution remained unchanged during the year. These were published in full in the first annual report of the Division. 7. Wellington City Council Price Structure and Reconciliation with Hutt Valley Trade The supply of milk to the Wellington metropolitan area, which includes the Hutt Valley, is not handled under the National Milk Scheme, and a totally different price structure is provided for the purchase of milk from town milk producers. Following upon the increase under the National Milk Scheme of 0-78 d. per gallon, consultations

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District. Name of Association. Nominated Quantity. Whangarei Auckland Hamilton Rotorua Tauranga Whakatane Gisborne Te Puke Napier-Hastings .. Waipukurau Dannevirke Palmerston North .. Levin Wanganui Feilding Hawera Eltham Stratford New Plymouth Raetihi Nelson Blenheim Westport Christchurch Whangarei Co-operative Milk Marketing Co., Ltd. New Zealand Co-operative Dairy Co., Ltd. Stonex Co-operative Milk Producers, Ltd. North Shore Milk Producers Co., Ltd. Auckland Milk Co., Ltd. Hamilton Co-operative Milk Producers Co., Ltd. New Zealand Co-operative Dairy Co., Ltd. Rotorua Co-operative Milk Producers Co., Ltd. Tauranga Milk Producers' Association Whakatane Milk Producers' Association Gisborne Co-operative Milk Producers' Association, Ltd. Te Puke Milk Producers' Association Hawke's Bay Raw Milk Producers' Co-operative, Ltd. Waipukurau Milk Producers' Association Maharahara Co-operative Dairy Co., Ltd. Manawatu Co-operative Milk Producers Co., Ltd. Levin Milk Producers' Association Wanganui Co-operative Milk Supply Co., Ltd. Feilding Milk Producers' Supply Association Hawera Co-operative Milk Supply Association, Ltd. Eltham Co-operative Dairy Co., Ltd. Stratford Milk Producers' Association New Plymouth Dairy Farmers' Co-operative Milk Supply Association, Ltd. Raetihi Milk Producers' Association Nelson Co-operative Milk Producers' Association, Ltd. .. Blenheim Co-operative Milk Supply Co., Ltd. Westport United Dairies, Ltd. Christchurch Metropolitan Milk Suppliers Co-operative Association, Ltd. Canterbury Dairy Farmers' Co-operative Milk Supply Co., Ltd. .. South Canterbury Co-operative Milk Supply Co., Ltd. South Canterbury Co-operative Milk Supply Co., Ltd. North Otago Milk Producers' Association Dairy Farmers' Co-operative Milk Supply Co., Ltd. Town Milk (Dunedin), Ltd. Ashburton Milk Producers' Association Southland Co-operative Milk Supply, Ltd. Opotiki Milk Producers' Association Mount Maunganui Milk Producers' Association Dairy Farmers' Co-operative Milk Supply Co., Ltd. Taumarunui Milk Producers' Association Gallons. 1,250 14,662 6,994 2,450 5,094 2,800 1,055 940 740 455 1,950 90 3,500 130 725 2,820 380 2,550 320 525 126 405 1,975 290 1,725 770 460 3,200 Timaru Waimate Oamaru Dunedin Ashburton Invercargill Opotiki Mount Maunganui Balclutha Taumarunui 12,500 2,300 220 880 6,200 2,600 320 2,560 115 88 360 352 Total 86,876

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were held between the Wellington Dairy Farmers' Co-operative Association, Ltd., the Wellington City Council, and the Milk Marketing Division, and resulted in the following price schedules being determined upon for the 1946-47 milk year : Summer period .. .. .. 17-75 d. per pound butterfat, plus 5-39 d. per gallon added value. Autumn period .. .. .. 17 *7sd. per pound butterfat, plus 7-79 d. per gallon added value. Winter period .. .. .. 17-75 d. per pound butterfat, plus 85 per cent, of 17-75 d.,. plus 7-54 d. per gallon added value. By agreement, also, the processing and distributive operations of the Wellington City Council and of milk vendors in the Hutt Valley are governed by the same margins as those applied under the National Milk Scheme, and on the basis of stabilized retail prices an annual reconciliation is made between the Milk Marketing Division, the Wellington City Council, and the Wellington Dairy Farmers' Co-operative Association, Ltd. In respect of the 1946-47 milk year this arrangement resulted in the payment of subsidies to the industry through the Wellington City Council to an amount of £108,833 12s. lid., and direct to the Wellington Dairy Farmers' Association in respect of raw milk trade in the Hutt Valley to the sum of £3,289 18s. 3d. 8. Wellington Thirty-mile Producers : Payment of Special Winter Feed Allowance Milk producers within a thirty-mile radius of Wellington were paid a special winter feed allowance of -|d. per gallon on total sales for the 1945-46 milk year. For the present year, 1946-47, the procedure was altered, by agreement, to the basis of the payment of 1 • Id. per gallon on milk produced during the autumn and winter periods. This allowance involved the payment by the Milk Marketing Division of subsidiesamounting to £8,454 on milk handled during the milk year ended 31st August, 1947. 9. Organization of Emergency Milk Supplies During the year drought conditions were experienced, particularly in Auckland, and emergency milk to the extent of approximately 89,922 gallons had to be secured from emergency cheese-factories in the Aka Aka and Hauraki Plains areas. These arrangements involved the payment of additional amounts totalling £1,548. 10. Payments Made by the Milk Marketing Division in Respect of Milk Supplied for Human Consumption for the Period Ist September, 1946,. to 31st August, 1947 (a) Payments made under National Milk Scheme to producers, treating £ houses, and vendors .. .. .. .. .. 442,349 (b) Cost of surplus milk scheme .. .. .. .. .. 67,898(Note. —The cost of purchasing milk at national milk price after deducting actual realizations was the equivalent of 0-6927 d. per gallon of actual town milk sales) (c) Payment of winter feed allowances .. .. .. .. 8,704 (d) Payment of administration levy to producer associations .. .. 7,895 (e) Payment of levies to local Milk Authorities .. .. .. 9,498 (/) Payment of additional transport and handling costs incurred in obtaining emergency milk supplies .. .. .. .. 1,548 £537,892 Approximate Coat of Paper.—Preparation, not given; printing (788 copies), £7 10s.

By Authority: E. V. Paul, Government Printer, Wellington. —1948. Price 3d.]

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