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Official Guide to the Government Court: N.Z. Centennial Exhibition

Primary Products Marketing Department

Primary Products Marketing Department

This Department was constituted under the Primary Products Marketing Act of 1936, which Act was promoted in order to "make better provision for the marketing of dairy produce and other primary products so as to ensure for producers an adequate remuneration for the services rendered by them to the community," and in view of the necessity, "in the public interest that producers of primary products should, as far as possible, be protected from the effect of fluctuations in the market prices."

The Department commenced to function on August 1, 1936—the opening of the 1936-37 dairying season—and its activities at that time were limited to dairy produce. Under the Amendment Act of 1937 two separate Divisions of the Department were constituted and provision made for such further Divisions as might become necessary in the future. The original organisation became the Dairy Produce Export Division, while the Internal Marketing Division was formed to carry out marketing within New Zealand.

The Export Division has now completed the disposal of its third season's produce. Its operations fall into two categories—(a) the purchase of manufactured produce from dairy factories, and (b) the realisation of such produce on the overseas markets.

Butter and cheese are purchased f.o.b. ocean steamer at "guaranteed prices", which are fixed each season to enable the dairy-farmer to receive a return for his produce commensurate with the cost of production and the maintenance of a standard of living comparable with that of other classes of the community. The prices have been fixed by the Government after a careful study of the many factors involved and after consideration of the recommendations of committees representative of both the industry and the Government. The prices have varied from year to year, but the objects of the legislation have been achieved in that the producer has received o fairly constant net return throughout the period that the Division has been operating, page 60 which is in marked contrast to conditions previously obtaining when, over one particular period of six years, prices for New Zealand butter on the London market ranged from 65/- to 185/- per cwt., with corresponding fluctuations in the producers' returns.

While everything possible is done to develop markets in the East and elsewhere, the main purchaser of New Zealand dairy produce is still the United Kingdom, and the Department has an organisation with headquarters in London to direct this side of the work. As in New Zealand, where the New Zealand Dairy Board was called on to supply the nucleus of the staff required, so in London the Dairy Board organisation was taken over and expanded, and the Department then had at its disposal the knowledge and experience of officers who for many years had made a study of markets and marketing problems.

The Dairy Board had conducted several attempts at co-operative marketing, which, although not without merit in themselves, had been severely handicapped by reason of the fact that the Board did not have complete control of the whole of the Dominion's dairy produce. The formation of the Department removed this obstacle, and there has now been built up a sales organisation which is held in high esteem by those persons qualified to judge, and by the majority of the exporting countries in the world.

As a result of the maintenance of high quality in New Zealand produce, the regular arrivals of shipments, the prevention of speculative dealings, and the pursuance of a keen publicity programme, the goodwill of New Zealand dairy produce on its chief market—that of the United Kingdom—has been greatly enhanced, and, at the same time, the New Zealand producer has received better and more uniform returns at a considerably-reduced cost of handling and adminis  tration.