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appropriate organization, it appears to be by no means impossible, in any case in the states where the dairy industry is of considerable importance, to obtain regular returns for the various elements which require to be known in order that an annual estimate of milk production may be made. The concrete solution of the problem depends upon general conditions (e. g., administrative arrangements, institutions already in existence, the particular type of dairy industry, etc.) which vary with the different countries. Hence it is impossible to lay down any general rules as to practical methods of obtaining the necessary data such as would meet the case of every country. It must suffice to state that the willing and whole-hearted cooperation of milk producers and their associations in the matter of the provision of the figures is an indispensable condition of success for any proposed action in this direction.
When annual estimates of however rough a character are supplemented by census takings at less frequent intervals, it will become possible to check results and in consequence to effect improvements in method so as constantly to be making a closer approach to the actual facts.
9. The yield of dairy products (such as butter, cheese, condensed milk, etc.), can be readily ascertained by direct returns in connection with censuses of production. It should not be difficult to organize annual statistics, such as are already in existence in certain countries, of the amounts produced in establishments of the industrial type. It is, however, considerably more difficult to obtain figures from year to year of the yield of dairy produce on the farms themselves.
In any event, a knowledge of the actual extent of the milk production affords a sure guide for forming an opinion as to the position of the output of dairy products. Hence, in the first instance at any rate, it appears to be desirable to concentrate chiefly on efforts to secure the establishment of annual statistics of milk production for the different countries.
1. To sum up, all countries, or at least all those in which the milk industry is specially important, ought to develop the organization of regular statistics of milk production. Where such statistics can not be established on the basis of direct annual censuses, they should at least include:
(a) A census taken at regular intervals, for example, every 10 years, which should enumerate the actual quantities of milk produced and of dairy products.
(6) An annual valuation of milk production obtained indirectly on the basis of the actual number of milk cows and the annual estimate of yield per head.
Statistics similar to those recommended in the case of cow's milk should also be established for sheep's and goat's milk and their derivatives in countries where their production is of any considerable importance.
The International Institute of Agriculture would arrange for the collation and distribution of all the statistical information thus collected from the respective governments.
2. This scheme can only be carried out gradually and as the result of special efforts by reason of the undeniable practical difficulties which have to be overcome.
But the resultant advantages are so obvious and of such general interest that the institute is confident that it will be able to persuade the adherent governments to put it into practice for their own countries and that it will also have the support of dairy farmers and the dairy trade.
By the terms of its constitution, the International Institute of Agriculture is charged with the duty of serving with the governments as interpreter of the recommendations made by international congresses.
The institute would therefore be glad if, in bringing the question of milk statistics before the next meeting of the general assembly, in 1924, it might be in a position to state that it is at the same time giving expression to the recommendations which the congress will be formulating on the subject.
Chairman LARSON. It was announced at the beginning of this session that, according to ruling, when the regular speaker was not present it was necessary to move the paper to the end of the program. We have now arrived at a time when that paper is in order. We have here to present Doctor Taylor's paper his associate, the assistant chief of the Bureau of Agricultural Economics of the United States Department of Agriculture, and I would like to know the opinion of this delegation as to whether he should be heard at this time. Are there objections to hearing from Mr. Tenny on " International trade in dairy products"!
(The members applauded, indicating their desire to hear Doctor Taylor's paper).
Mr. TENNY. Mr. Chairman and gentlemen: If you do not appreciate now that Canada and the United States are of one mind, you will after I have read Doctor Taylor's paper. It is very interesting to see how two people thinking along the same lines reach pretty nearly the same conclusions.
(Mr. Tenny then presented Doctor Taylor's paper.)
INTERNATIONAL TRADE IN DAIRY PRODUCTS: SIGNIFICANT
TRENDS OF SUPPLY, DEMAND, AND PRICE.
HENRY C. TAYLOR, Ph. D., chief, Bureau of Agricultural Economics, United
States Department of Agriculture. Dairy products are entering international trade in increasing volume and the prices of dairy products everywhere are increasingly influenced by world conditions. In the 40 years preceding the World War the quantity of dairy products entering international trade had increased fourfold. In 1922 the total volume had recovered to fully 20,000,000,000 pounds in terms of their estimated milk equivalent, or practically to pre-war volume. Dairy products are now imported into the United Kingdom, by far the most important importer in the world, in greater volume than ever before. According to official estimate, imports of all dairy products into that highly industrialized country are now equal to 54 per cent of the
total consumption in Great Britain. Approximately three-fourths of its total supply of butter and of cheese is imported.
The present significance of foreign trade for certain exporting countries is equally apparent. Denmark, as you know, now depends upon foreign demand for roughly nine-tenths of its butter output, Argentina for three-fourths, and New Zealand for the principal part. Of the cheese-making countries, the Netherlands now depends upon sale abroad for approximately two-thirds of its output, Switzerland two-fifths, Canada nine-tenths, and New Zealand, again, for all but a minor part.
The mere volume of exports or imports from year to year may yield a superficial analysis of the world situation as it affects the dairy industry at any particular time and place. But it is important that the trade is already sufficient to place dairy products in the first rank among those staple agricultural commodities for which the market is a world market.
Comparison of prices actually paid in various important markets of the world shows conclusively that a world price level prevails. Prices in any one country can not get far out of line without inducing international shipments that are profitable to importers and exporters. The closeness of the relation between monthly average prices of butter as they prevailed in important markets in Germany, Denmark, Great Britain, and the United States during the 10-year period just preceding the war is more effectively shown by comparison of price trends in three of the principal dairy markets in the United States during the same period. Temporary variations in both groups serve only to emphasize the persistent tendency toward adjustments between markets. Dairymen the world over are rubbing shoulders with each other in competition in virtually one great market.
Recently improved transportation facilities, modern methods of preserving milk, and extension of market news and information have made possible a great expansion of the international trade in dairy products. Transportation improvements affect both quantity and quality of shipments. A single ship recently carried a cargo of 3,600,000 pounds of butter from Canada to England. Refrigeration has made possible the transportation of fresh milk across the American continent and from South Africa to England. Now the report reaches us that “by means of the proposed Harwich-Zeebrugge train ferry it is hoped to place continental produce in London sooner than from the English countries. It is stated that even liquid milk may be imported by this method.” At the present time butter can be shipped to New York City more cheaply from across the Atlantic than from some of the best dairy sections of the United States. In fact, the relative cheapness and efficiency of water transportation is coming to be widely recognized and may be expected to play an increasingly important part in determining channels of trade.
Processes of preserving milk through partial or total dehydration have facilitated international trade. By means of such treatment the equivalent of more than 2,000,000,000 pounds of milk was exported from the United States to Europe in 1919. Improvement in means of communicating market news may be expected much further to promote commerce in dairy products on an international scale.
Certain developments, on the other hand, tend to check or diminish the need for international trade movements. One of the most effective checks upon the development of foreign trade in dairy produce is the established systems of cold storage such as have grown up, especially in Canada and the United States, by which domestic supplies are regularly stored from seasons of heavy production to seasons of light production. Ireland, while without extensive cold storage, was normally importing butter during the winter months at the same time that nearly 100,000,000 pounds were being exported every year.
While the total milk production is nearly the same in Great Britain as in Canada, the former imports, in addition, an equal quantity in the form of various milk products, while the latter still exports about one-fifth of its total production. The growing industrialism in Canada with its consequent increase in home consumption is already tending toward the lessening of the exportable surplus in that country simultaneously with an increasing total dairy production.
Another influence of recent origin is the imitation of particular varieties, especially of cheese, that have found sale in foreign countries. Swiss, Camembert, Limburger, Roquefort, and certain Italian varieties, by means of scientifically controlled conditions of manufacture, have been imitated in this country. Swiss cheese, especially, is now manufactured here on a commercial scale.
A striking development, significant for all countries concerned in the world's dairy industry, is shown by a classification by countries as exporters and importers, according to the rank of each as they were just before the World War and as
they are to-day. Sources of surplus have made a marked shift from countries of the Northern Hemisphere to countries of the Southern Hemisphere. Before the war the United Kingdom received just one-fourth of its imports of both butter and cheese from the Southern Hemisphere. In 1922, somewhat more than one-half was received from New Zealand, Australia, Argentina, and South Africa.
The chief significance of this shift undoubtedly lies primarily in the resulting change in the seasonal trend of butter imports into that country. The seasonal fluctuations of production in the one hemisphere, of course, naturally complement those in the other, with the result that if supplies for a great importing country such as Great Britain were drawn equally from both regions, the supply throughout the year would tend to be rather uniform. However, that very important part of the supply which comes from Denmark has, as you know, been adjusted to a remarkably even flow from month to month throughout the year. The seasonal trend of supply on the British market was deemed of sufficient importance by the Danes to justify them in turning to winter dairying in order to profit by the relative scarcity and higher prices prevailing in that season. At the same time, supplies from Russia, Sweden, and France were normally heaviest in summer. Now that Russia is practically out of the trade, and supplies from Sweden and France are meager at best, a strange situation has arisen, in which there is actual scarcity in the summer months and early fall, before supplies from Australasia reach the British market.
As a result, the British butter market, during the last few years, has been without its pre-war stability because, as yet, there has been no such adjustment to the new supply trend as made for such remarkable stability before the war. The anticipation of shortage of supplies in the summer and early fall has thrown something of a speculative element into the butter market there. This is further demonstrated by the tendency recently observable for prices of butter to move less in sympathy with prices of cheese in the British markets than previously. This is what we should expect if the seasonal supply of butter is being subjected to a shift while cheese supplies remain uniform. And we know it is true that, in the cheese trade. Canada and New Zealand not only complement each other in seasonal shipments to the United Kingdom, but even in the matter of quantity the imports from Canada just about balance those from New Zealand.
This tendency toward higher summer prices in the British dairy markets raises the question as to what influence it may come to have on the dairy world aside from its direct effect on the British and Irish producers. The possibility is not to be overlooked, of placing large quantities of butter in cold storage in Great Britain during seasons of heavy supply, to be withdrawn and placed on the market in those months in which prices tend higher. But the well-known preference of British consumers for the fresh products that have been brought to their door the year round from the Empire farm and from the Continent, is a fact to be reckoned with in studying the possible advantage or disadvantage to exporters, in different countries, in supplying the demand. It is possible to trace some of the effects of this shift into other countries, such as Denmark, the Baltic States, and the United States.
Danish farmers would seem to us to be in a peculiar position. The winter prices, to which they long ago adjusted production by turning to winter as well as summer dairying, are now depressed by heavier supplies produced by farmers in Australia, New Zealand, and Argentina in their own summer season. On the other hand, the summer prices, to which they might have adjusted production along lines of less resistance had they been sufficiently remunerative, are now raised by the scarcity of supply from their competitors in that season. But a system of agriculture like the Danish is not to be changed overnight. If it were, the growth of dairying in northern sections might later swing the balance again. Nor is the conscious advantage to Danish producers in having their fresh butter available to their customers in uniform quantities the year round to be sacrificed lightly. Rather we would expect any Danish adjustment to take the direction of continuing to seek other alternative markets, and possibly even to turn, seasonally at least, to greater production of cheese and other milk products.
It is probable, too, that this outlined situation may prove fortuitous to farmers in those promising dairy countries of northern Europe-Finland, Esthonia, Latvia, and Lithuania—which, with dairy resources similar in some respects to those of Denmark, are quietly emulating that veteran dairy country, and are to be regarded as having possibilities not to be ignored in the future development of