The San Francisco call. [volume] (San Francisco [Calif.]) 1895-1913, 1895-06-14
A STRONG WHEAT TRUST.
The Combination Will Clear a
Million in Less Than Six
Months.
FARMERS TO PAY THE TOLLS.
By Fixing Ocean Freishts the Trust
Governs the Entire Output Of
the State.

1t was announced yesterday that a num-
Der of free ships were bound for this port;
that their identity was being kept secret
so that the local wheat combine could not
set their plans to buy them up; that upon
their arrival within the next two weeks
they would load wheat for Liverpool at
rate much below that established by the
combine, and that their cargoes would not
be controlled by any one of the four firms
IN the combine-McNear Eppinger & Co.,
Baldwin, Girvin & Eyre or Balfour, Guthrie
& Co.
All this was rumored, but, like many
another rumor, 1T could not be substantiated
by tangible facts-more's the pity. Should
the rumors turn out to be true it will mean
the disruption of the wheat trust in this
City, which in turn will mean lower freight
rates on wheat, higher price for wheat, a
strong hay and grain market generally,
better prices for all farm produce, at least
$1,000 000in the pockets of the grain farmers
OF California and a prosperity of the entire
State in keeping with and that always fol-
lows upon the prosperity of it's producers.
But the brokers of San Francisco say
the rumor cannot be true. They say that
free ships cannot come secretly to this
port because the agencies of the wheat
trust are omnlpotent on the seas in the
matter OF gathering news of the move
ments of vessels. They point out that
nothing can stand against the wheat trust
because it has not only the capital with
which to operate all of the Fair wheat to
handle and the only wheat shipping firms
In the city as members, but it has also the
facilities for handling grain that no other
California merchant or combination could
command. Already the trust has chartered
all the ships deemed necessary for the
maintenance OF ocean freights, and it
stands ready to charter as many more
bottoms should that course be essential to
the perpetuity of the wheat trust.
Oh, the wheat trust will live, say the
brokers and the wheat merchants of this
city. Not gladly do they say it, but with
the certainty of a positive conviction on
the subject, born of their knowledge of the
men who form it and the methods they
have employed.
Nothing now can harm the wheat
trust" said William II. Yates, the Cali
fornia-street broker. Free ships cannot
come in, and if they could the combine
would gobble them up if they needed them
or wanted to keep them out of the hands of
other shippers. But who's to do the ship
ping in these free bottoms, granting that
firms in town and they make up the trust.
No one else could ship if they wanted to do
so, for these firms have all the warehouses
and shipping facilities in their own hand
There is only one thing which can spoil
the combine now and that is quarrel
among the four firms that compose it
and that is a contingency not at all prob
able. Their common interests-amount-
ing to 100000 or more-will keep them
together. In less than six months the trust
will clear that amount. 1t isn't matter of
guess work at all but one of cold calcula-
lation. The trust can't help clearing a
cool 81, 900 900 between now and the last of
December. That's $250,000 apiece for the
four tirms-a neat little profit for half
years business, and surely sufficient in
ducement to maintain harmony of action
among them for so short period"
And who pays the tolls? Mostly the
farmer, but no taxpayer may escape his
reckoned. Suppose California raises
100000 tons of wheat this year-a suppo-
sition that is not up to the careful esti-
mates made for the "street" and the mar
ket. 1t ought to sell for from 81 to 81 05
per cental-the Chicago market is strong at
81 80. The rate fixed by the wheat trust is
from 20 cents to 50 cents per Genital. The
difference is 81 a ton.
This is very safe misunderstanding a
wide margin for even possibilities. On the
street the farmers loss is estimated at
100000; call it 100000 and be safe
Then remember that four firms in San
Francisco have the power to lessen the
profits of the farmers of this State to tie
amount of 100000. 1t seems odd, but it
is true, and moreover the power comes
merely from what is known as business
sagaclty. There is nothing dishonest in
the transaction. 1t is quite regular, the
whole thing, in the business world, and
verv simple operation withal.
The four firms named began this little
business enterprise by chartering all the
ships in sight. When they had chartered
enough of them to be able to say to the
vessel-owners what rate they should
charge for carrying wheat from San Fran
cisco to Liverpool, they fixed that rate very
high-so high that wheat must be sold
very cheap in order to leave any margin at
all on the Liverpool prices for the ex-
porter. Then these four firms dubbed to-
gether again, and bought up that big lot
OF SO wheat that the late Senator Fair had
accumulated in his last deal on the wheat
market. Senator Fair merely meant to
speculate. Wheat was very low when he
began buying. He thought it would go
up in month or two, so he bought
heavily. But wheat staid where it was,
and did not rise. To prevent it going still
lower Senator Fair had to buy still more
wheat. He had to buy so much that it
took all his spare cash, but still he had to
buy more. He raised money on his Sc
curities, he borrowed money, he mort
gagged property, and with the cash thus
raised he bought more wheat.
If he had ceased buying the wheat would
have deprecated, and that would have
meant the loss of a great sum of money to
the Senator. Folks say that it was the
miscarriage of this wheat deal which killed
the Senator. Anyway, he died before
wheat advanced in price, and now all the
wheat he owned, amounting to 1S0, 900 tons,
has been bought by what is called the
wheat trust.
With this enormous block of wheat in
its control, and with the vessel rates placed
so high that wheat must be sold very low
in ORDER TO leave profit to those who ham
die 1t, the wheat trust has things pretty
much in its own hands, while the farmer
well, the farmers interests do not cut much
OF figure in the calculations of these
shrewd gentlemen and sagacious business
men who have been forewitted enough to
see the chance to make profit of 81 900, 900
in less than half a year and have been able
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