The news & observer. [volume] (Raleigh, N.C.) 1894-current, 1902-08-10
SIX DOLLARS PER TON
Farmers Should Receive About Thirty
Cents Fer Bushel.
THEY CAN CONTROL THE PRICE OF Sf[D
The Local Independent oil Mills Can and VIII
Pay lust as Much for the Seed as
the agents Of the
Trust


(Harvie Jordan in Atlanta Journal)
There is no other single industry in
the South which is developing more
rapidly than that of the oil milling bust
ness. From an infant industry of 80
years ago. it has grown until now nun
dreds of millions of dollars are invested
in cotton seed oil mill plants all over
the South Atlantic and Gulf States. The
rapid development of this business is
largely due to the fact that it is pay"
ingdustry to those who have invested
their millions in it. From a few small
plans which were erected in the 7O's
and operated as independent concerns
the business has grown until now we
have the cotton seed oil trust with its
millions of capital controlling and oper-
ating large numbers of mills under the
management just the same as the steel
trust, meat" trust and similar trusts
of like character. While the oil trusts
have been buying up large numbers OF
small mills during the last few years,
the small local independent mills con-
Linue to be built and the promoters OF
all these small or large industries con-
tinue to make money. The business is
fascinating one because the dividends
are usually satisfactory and the inves
tors are contented and happy During
the past seasons, the oil mills Melted
possibly the largest dividends ever be-
fore realized in the business. The reason
for this was based upon the fact that
the margin of difference between the
purchase price of the raw seed and the
sale of the manufactured products was
sufficiently wide to realize to the manu-
lecturers an unusually large profit, run
ming on an average from Sc to $40 net
profit per ton. The price of seed was
low and the price of oil. meal and bulls
high. The cost of manufacture remain
ing the same as in past years.
AS promised to our correspondent from
Camak in the Inquiry Department of the
last issue, we will now undertake to
cover this question fully, that the farm
ers who have seed to sell may be fully
posted on the situation and know the
true value of their seed and how to
emeet the prices of the oil mill people
who come into the market for their seed.
II a farmer knows nothing of these
things, it is impossible for him to arrive
at any proper conclusion regarding the
value of his seed to the mill and to him
self.
BY-PRODUCTS OF COTTON SEED.
The price of cotton seed set by the
mills is largely based upon the market
price and demand for oil. In order to de-
termine the value of ton of cotton seed
to an oil mill therefore we must know
what the by-products of ton of seed
ho Inc nf
Deducting from that the price paid for
the ton of seed and the cost of manu-
facture we can easily arrive at the profit
or loss to the mill in working a ton of
seed The by-products of a ton of cot
ton seeds are as follows: 40 gallons of
oil, 700 pounds of meal and 1000 pounds
Of bulls, linters, etc.
In The Atlanta Journal of August Cd
we find the local market for these by
products f. o. b. cars at the mill, adver-
tised as follows: Oil 35 cents per gallon.
meal $24 per ton and hulls, loose, Sc
per ton. Applying these prices to the
different yields of ton of seed we have
the following:
40 gallons oil at 35c. .$14.00
725 pounds meal at $1.20......... $40
1000 pounds hulls at 30c........... 80
Iotal value ..................,,.. $25.fO
The price offered for seed is $14 per
ton or 81 cents per bushel. This would
leave a margin of difference of $11.70 per
ton between the cost of the seed and the
selling price of the manufactured pro-
ducts.
Out of this difference of $11.70 the mills
must pay the freight nthe seed from
shipping point to mill and the cost OF
manufacture, and whatever balance is
left will go to the net profit of the mill
on the business. The average rate of
freight on a ton of seed from shipping
point to mill is estimated at $3.50. and
the average cost of manufacture is 81
per ton. OF course where seed are de-
livered to the mill from wagons the
freight is saved. We have here the total
cost of manufacture including freight,
amounts to $3.50 per ton. These are out
side figures, some mills working the seed
for less than "a per ton.
Now deduct the IS. 50 cost of freight and
manufacture from .1170 the net differ
ence between the original cost of the
seed and the value of the by-products at
present prices and we get the net omunt
of $500 per ton, which should go to the
profit of the miIs on the business. If
a mill should work 5000 tons in one sea-
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