San Marcos free press. [volume] (San Marcos, Tex.) 1877-1892, 1882-05-25
Handling California Wheat by the Gull
Route.

The opening OF the Southern rhcin
Railroad and the movement OF whea
by that route TO Texas and st. Louis
have given rise TO the erroneous ide'
that tho tonnage market OF this por
has been seriously affected by tie com
petition and freights cannot again, al
vance materially. This idea has beer
pretty generally circulated, and has
misled some worthy Philadelphia
scribe, whose words of wisdom have
been copied into the Liverpool ship
ping Telegraph. He commences py
condescending to admit that "mosl
English consumers of American wheat
are probably aware that large part o.
the export comes from the Pacific coast
by a long journey in sailing ships
around Cape Horn, the voyage occupy
ing four or five months. The San
Francisco export reaches an enormous
total, and freight is an important Item
in the cost, reaching sometimes as high
as "a per tom Then follows the as.
tonishing statement that wheat shipped
by rail and steamer will reach England
much quicker than by sail, via Cape
Horn. Further on the same writer
says: =,
"The announcement was made by the
railway that wheat could he carried
from California to the gulf ports for
$l3 per ton or even less. To this must
be added the cost of transportation
from the gulf ports to Europe, estima.
ted with the terminal expenses at about
cents per bushel, and the whole cost
of the new route will be about 67@6os.
Dor ton. When the railway began traf-
ic the freight rates for direct shipment
of wheat by vessel at San Francisco to
the United Kingdom fell to Dos. per
ton under sort of scare.
"Tne merchants then began making
calculations, and concluded that the
lowest possible price of trans
port by the new route by rail could not
go under Cos. per ton, and it might be
more, so that the freight market by
ship strengthened somewhat, though
nothing is quoted above 57s. cd. per
ton. There is aninteresting discussion
of the subject in California, as between
the respective merits of the two routes,
and it is probable that the opening OF
the railway will be such check upon
ship chartering that wheat rates at San
francisco cannot very soon again reach
the high figures that prevailed not long
ago."
That such statements could be copied
into reliable shipping journals, when
the facts in the case are so easily ascer-
tanned, is somewhat remarkable. The
decline in freights here. as is we'll
known, came about before the railroad
opened, and was due to natural causes,
namely, the heavy accumulation OF dis
engaged tonnage there at time when
the lack of rain threaten ed short crops,
while d weak and declining wheat
market abroad aided in depressing
values. Extreme rates of freight can
only be obtained at time when ships
are very scarce and wheat abundant,
and these circumstances are not liable
to arise again in the near future, but
from the present outlook there is rea-
son to believe good paying rates will
rule during the coming season. Mean
while, the following may be relied
upon: The actual cost of transporting
freight is one-half q cent ton per
mile on roads having large local and
through business: this is exclusive of
interest on stocks and bonds. The
distance from this port to New
Orleans is 2460 miles, and the actual
cost of handling and transporting the
wheat to that port is, at the lowest cal
culation, $12 324 per ton; and as the
road runs for the greater part through
a desert, it is probably higher. Such
a rate would not be accepted, however,
for any length of time, as interest on
the investment, if no other profit would
necessarily be demanded. Add to this
the cost of sending the grain by steamer
to Liverpool, the cost of bringing back
empty cars, and it is not hard to see
that the railroad can only compete with
ships at heavy loss when freights are
at present quotations. Although con-
siderable wheat has gone forward, in
March (33, 1926 centals, on modern
sized cargo), none of it has been sent
abroad, and to date therefore, the only
competition from the railroad has been
that caused by opening a new market
for wheat in this country, and to that
extent freeing producers from depend
ing on the English market. The
freight market, stimulated by better
prices of wheat abroad, the extremely
favorable prospects for large crop
this harvest, and by a moderate supply
of tonnage on the spot, has advanced
the highest limit allowed
by the Philadelphia wiseacre, aud its
advance or decline in the future will
depend on the supply of tonnage as
with the supply of wheat,
and for another year at least, the rail-
road can have no perceptible effect on
ireights, for even should they attempt
TO compete for the carrying trade, the
amount that could be sent that way,
-. a. a. rto,,1l