The Forrest City times., 1892-02-19
A TRUST IN TROUBLE
DISASTER THREATENS THE
 OATMEAL COMBINE.
Too Many Mills and Too Low Prices The Problem It Has to soiye-ihe Beer Warfare To Be Brought to An End by an Enormous Combine.


 dent in an interesting trust drama was the failure last week of the $. J. Burns x Co., oatmeal mills at St. Joseph, Mo. The history of the oatmeal business Tn this country for the last five or SIX years is as striking a lesson in politlcal economy as can be furnished in any line of industrial affairs. The evils of industrial pools and trust tcombinations, when managed with too great greed, are shown in the oatmeal business, after several years of thorough trial, Tn a condition of depression that IS per haps greater than in any other line of active industry.
 The condition of the oatmeal busi- ness to-day may be summarized Tn about this way: The capacity of the oatmeal mills in the country is 4,oo0,- 900 barrels of meal a year. The total consumption is 300, GOO barrels of meal Under the influence of pools and trust combinations the construction of mills has been so stimulated beyond the needs of consumption that seven-eights of the mills now standing ere useless for the purposes for which they were built, and represent only so much idle and wasted capital. On the other hand, the competition of these mills, which have been extended to eightfold the capacity for which there is need, is so great that the product is now being sold to the wholesale trade at prices actually less than the raw grain that is required to make the meal.
 The first combination of any import ance was formed six or seven years ago and included six mills. Most of them were in the East. and the big Musca- tine, la, mill represented the Western end of the combination. These mills hung closely together for a long time and were known to the trade as the ''immortal six" Their agreement ex- tended only to the maintaining of prices and no restriction was placed on | the output. The great competitor was the Shoemaker mills at Akron, Ohio. | Mr. Shoemacher is the father of the | oatmeal business in the country and had built up enormous mills at | A hIOb. A EIEdl oNtpl away thS | Sheomacher mills and while the fire men were playing on the sl,500, ,ooo ruins the immortal six combination ad- vanced their price 62l4 cents barrel. 1. It took long time to rebuild the Ak ron mills, and while that was being done great inroads were made upon | their trade. When they were ready for business once more Mir. Shoe macher was also ready to listen to talk of pool agreement.
 The arrangement under which the | pool was for!ued was that each mil was allotted q certain percentage based upon the business it had beer doing. No restriction was placed or the production, but at the end of eact month the total output was reckoned ny, the percentage of the whole eacf mill was entitled to was calculated and those who overran their percent age paid into the pool fixed amour barrel and those who underran receiv ed the same amount barrel.
 That sort of thing kept on till ther' were forty-four mills shut down by tn, pool and only thirteen mills running Those thirteen mills not only had t, make the profit for their stockholders
 but they also had to make profit for tn, stockholds of the forty-four mills tha
 were idle. They did this for time
 but at last the strain proved too grea
 and the pool broke. A project is nov
 being considered for uniting all tn
 mills in the country once more. Tn
 lesson of ruinous competition has beel
 sufficiently learned, it is thought, s
 that mill-owners will listen to the pro positions, while the field is already S vastly overbuilt that it is believed fires capital could not again be induced { build more competive mills even if
 combination is brought about whic
 puts prices once more on a opayin
 basis