H,— 29,

In the calendar year 1935 there was a marked falling-off in the number of certificates issued in respect of the work of certificate-of-record testing. The number of certificates issued was 723, whereas 892 were issued in the previous year; in 1935 there was a slight decline in the average butterfat production relative to these certificates. In comparison with the previous year there were declines also, both in the number of cows tested under Government official herdtesting and in that under ordinary herd-testing —in the latter the decline amounted to 31,703 cows. During the year the organization of group herd-testing was remodelled. The previous control by a voluntary non-statutory body was discontinued, and the Dairy Board was given power to control group herd-testing and associated work. During the year herd-testing was assisted by a Government subsidy of £4,000. While the position in the dairy industry as a whole is particularly satisfactory, especially when one takes into account the recent progress and improvement that has taken place in a period of difficult conditions, during which production and quality have been- maintained and considerable building for the future has taken place in both pastures and stock, there is, nevertheless, need to mention two matters in regard to which there is considerable call for improvement —the quality of dairy-produce and better control of the diseases of dairy stock. As in the past the Department continues to give much attention to measures the object of which is improvement of the quality of dairy-produce —the system of farm-dairy instruction warrants specific mention in this regard. During the year thirty-nine dairy-farm instructors were employed by eighty-nine dairy companies, receiving supplies from 36,098 farmers of a total of 70,258 suppliers to dairy factories for the whole of the Dominion. Hence, 34,166 suppliers to dairy factories did not receive direct advice regarding the quality of their produce. In common with the dairying of other countries, New Zealand dairying suffers grave annual losses because of the diseases of dairy stock. In respect of this one can obtain but little if any consolation from the fact that some of the major diseases, such as mastitis and contagious abortion, seem to be more burdensome at times overseas than in New Zealand, and this in countries which have devoted more funds and ability to research relative to the control of the diseases than could be provided by such a small country as New Zealand. As is indicated by the appended report of the Director of the Live-stock Division, the work of investigating these diseases continues to be prosecuted vigorously in New Zealand, and at the same time New Zealand veterinarians and associated workers take pains to keep themselves acquainted with the results of cognate research overseas. The Sheep-farming Position. The somewhat unsatisfactory condition of sheep-farming in 1935 was replaced in 1936 by a remarkably buoyant one, comparable to that of 1934. The change was due largely to the great change in the wool position. The wool sold reached a record quantity, and the prices obtained in 1935-36 showed a marked improvement in comparison with those of the previous year. The following information taken from the annual review of Messrs. Dalgety and Co., Ltd., sums up the position : — " The following table gives a comparison of the results of the Dominion wool sales for the last two seasons :— 1934-35. 1935-36. " Bales sold .. .. .. .. .. 479,797 756,833 " Net weight, lb. .. .. .. .. 164,618,251 264,947,142 " Weight per bale, 1b... .. .. .. 343 350 "Gross value .. .. .. .. .. £4,486,480 £10,083,297 " Average per bale . . . . . . . . £9 7s. £13 6s. sd. " Average per lb. .. .. .. .. 6-54 d. 9-13 d. " The above table shows the following increases for the 1935-36 season : Bales, 277,036 ; weight, 100,328,891 lb. ; gross value, £5,595,817 ; value per bale, £3 19s. sd. ; value per pound, 2-59 d. ; weight per bale, 7 lb. " The following figures show the bales sold and the average prices realized for North and South Islands respectively : —

7

Island. Bales sold. Average per Bale. P er £ s. d. d. lb. North .. .. .. .. 453,727 12 10 5 8-30 362 South .. .. .. .. 303,106 14 10 6 10-48 332 New Zealand .. .. .. 756,833 13 6 5 9-13 350