St. Paul daily globe., 1896-03-23
THREE-CEuT MARGIN
THE GLOBE GIVES THE BIG ELE-
YATcR COMPANIES A HEAR
ING,
SAY THERE is NO COMBINE,
nut THAT THEY ALL DO BUSI-
NEss5 eNSA THREE-CENT
MARGIN.
PROFITS WE'RE ONCE LARGE,
But They Claim Earnings Are Now
Not More Than Eight Per
Cent.

But They Claim Earnings Are Now
Not More Than Eight Per
Cent.
The indictment of the elevator COM
bine by the farmers of the Northwest
has been presented in the G. | o b dur
ing the past two months in a series
of letters from a special correspond
ent. The situation at a number of
points was thoroughly investigated,
scores of farmers detailed their los
ing experience in dealing with the line
elevators, and business men and others
added their testimony to the shameful
manner in which the wheat raisers of
Minnesota and the Dakotas have been
robbed of no small share of their legit-
innate profits.
1t is only fair that the answer of the
elevator companies should be given.
and the c. ! o b e presents their side of
the story this morning. The secretary
of the Minneapolis chamber of COM
meFce has a list of tWenty-eight line
elevators said to have headquarters in
that city. Investigation, however, shows
that two of the companies in the list
have gone out of business, while one
has abandoned the elevator for the
commission business in Southern Min
nesota and Iowa. OF the remaining
companies, twenty-one in all, eighteen
were visited by reporter for the
q e, and the president, manager
or some other high officer of each COM
pany was given an opportunity to make
any statement desired. The officers of
two companies were out Of the city,
and could not be seen. Only two of
the eighteen would talk at length for
publication. The result OF the round
up is given below:
P. B. SMITH,
general manager of the ST. Anthony
d Dakota Elevator company, says that
the farmers have in most cases made
false or exaggerated statements, and
have not told the whole truth. ut
might be true" he says, that farmer
would offer a load of wheat at an ele-
Vator which the local agent would grade
as No . or 3; and the same farmer
might have other and better wheat
which he would ship to a terminal
point and get a better grade" And this
is his only attempted explanation of the
many individual cases cited in the
G | Q b e where the farmer was fieeced
out of several cents a bushel on his
crops. Mr.. Smiths side of the case is
interesting, however, and is perhaps to
be taken as the official utterance of the
elevator combine. At least several
managers referred the G b reporter
to him as the one best qualified to
speak. The Interview with him follows,
without comment:
There is absolutely no combine of
the elevator companies was Mr.
Smiths opening declaration. For the
sake of argument, suppose there was.
1t could not be effective without let
ting our agents into the secret, and you
can judge if anything Of that kind
would be safe
But you send daily instructions to
agents?"
Yes. based on the daily markets.
and other companies send the same
instructions?'
I'VE do all send the same prices. by
common consent. The prices of all
companies at the same Station are the
same, as general proposition. 1t
would be impossible TO maintain two
prices at a station. If there was more
than one price the man who paid the
most would get all the grain. Let one
agent advance the price, and the 9th
ers follow as soon as they find it out.
Say wheat is worth SO cents today in
Minneapolis. We take that as the
price in the country for tomorrow. If
the freight is 10 cents, we would de-
duct 13 cents from the SO cents, max
ing the price Of wheat at that station
46 cents. This gives a three-cent mar
gin. We do not aim to allow the mar
gin to exceed three cents. We regard
a three-cent margin as the maximum
the very outside
Mr.. Smith produced a file of daily
statements in support of his assertion
On the higher grades the margin gen
orally ran under three cents and on
the two lower grades from three to four
In some cases the margin on the high
er grades went as high as four cents
bat was probably under, as a rule
especially the last few months.
"4hs to the statement that the elevator
companies realize profit of 80 per
cent" went on Mr.. Smith, II think the
companies themselves are largely re-
sponSible for the idea that the busi-
true that in the old days. say from 1886
to 1887, the elevator companies did
make large profits-as high as 80 per
cent, and sometimes even higher But
few elevator companies were then in
existence only one prominent company
on the Northern Pacific and but one OF
two on the Great Northern. Since 1888
however, there have been so many
companies dividing up the business
that | doubt whether the average net
earnings of the companies would
amount to per cent
You mean on capital stoclS?"
"ON CAPITAL INVESTED
In the business. Wait minute and III
touch on that. OF course there have
been good years and poor years.
know Of at least three years since 1888
when most of the companies lost mon.
ey and in 1898 two of them suffered such
serious losses that they We're forced
into the hands of. a receiver. Now, thl
elevator companies, in stating the pei
cent of profit on their business, have