The Mitchell capital. (Mitchell, Dakota [S.D.]) 1879-1918, 1905-03-03
r is SENT TO CONGRESS
6vnopsis Indicates That Pack.
ers Are Not OvercapitaIized
or Extortionate.
CONTROL BUSINESS
Only Do AS Per Cent. of the Slaughter
ing of the Country-Escess've
Profits Apparently Confined
to Private Cars.

~ S"'
Washington. d. G.. March 6.--The
president Friday transmitted to con-
gress the report OF Commissioner OF
Corporations Garfield upon the beef in
dustry. submitted in compliance with a
resolution of the house of representa-
tives adopted Mach {. 1904. A SUM
mary OF the report in part follows;
The Big Six.
That six big companies. Armour
& Co, Swift x Co. Morris x Co.
S~chwarzsohild X Sulzberger Co, and
the Cudahay Packing Co. frequently
designated as the Big Six" s'nush-
tered in the year 1908, 5,52l,697 head of
cattle out of a total indicated slaugh-
tered in the United of l2,50O,0O head.
or about 10 per cent.
that the true average net profit of
three companies, Armour, Swift and
Schwarzschild a SilZbcrger, for the
twelve months ending June 30, 1903.
as shown by their actual bookkeeping
records, was 81 cents per head, not in
Guiding incidental profits.
1902 Profits Not Excessive.
That year 1902, instead of being one
of eXorbitant profits. as commonly sup
posed, was less profitable than usual.
During the months when the prices
of beef We're highest. some of the lead
ing packers We're actually losing money
on every head of cnttle slaughtered.
hat the changes in the margin be-
tween the prices of cattle and the prices
of beef are in themselves no indica-
tions whatever of the changes in the
profits of the beef business.
Margins Were Not Wide.
That the margin between the price of
cattle and the price of beef during 1908.
Instead of being unusually high. as
popularity supposed, was for each half
o! that year lower than the margin
for any corresponding half year since,
1898.
That the increase i'm the margin for
the second half of 1903 over the first
half, was no greater than the similar
Change in other years.
In this connection the report saws:
I'm the face of a strong demand the
price of cattle was forced to the high
est level ever known. The high prices
of beef, which caused much complaint.
We're attributable wholly to abnormal
cattle prices"
More Production, Lower Prices.
That I'm 1909 the price of cattle fell
very sharply, chiefly because of a large
Increase hi the supply.
That the six leading packing com
panies especially discussed are appar-
entity not overcapit iized.
That the percentage of profit on the
great volume of business. including hog
and sheep products and other minor
commodities, is comparatively small.
That the profit of the private car
lines I'm the packing Industry. in mile
age. IS a liberal one, approximate com
putations indicating d net return Of
from IA to II per cent. Reckoning on
the basis of dressed beef TRANSPORTED
\ hnuTaNar fhiS rrnfy I4,,,Jl ,.]l 49,. n.
10 the cost of such beef to the con
sumner.
Plenty of Competition.
The statement that the six large con
Germs mentioned slaughtered in 1909
only a. per cent. of The total of cattle
killed i'm that year. indicates very clear
ly the existence of active competition
by other concerns, at least In many
places. This is chiefly explained by the
operation OF II large rumble of small.
slaughtering establishments.
Taking the principal Strengthening
and distributing centers the pro-
portion. controlled by the six
companies mentioned is much greater.
For instance, the six principal concerns
slaughtered nearly 9S per cent. of an
the cattle killed in oil the leading west
ern packing centers. They control a
very large percentage of the trade in
beef In maily large cities, particularly
VI VIZ 'tsA, lISll' vi W u I'd Der
cent.
In Smaller Cities.
In the small cities and tow:ls In most
sections of the country their rp"r itions
are relatively much less important. be-
ing between 10 and 80 per cent. In the
southern states the large packers gen
orally supply less Than half the total
beef consumed in the large cities and
in the smaller cities and towns the
, proportion is generally less than one
fourth.
Prices and conditions for the wears
1902. 1903 and 1904 are reviewed. and
the conclusion is cache that the per-
centage of profits on the gross volume
of business was comparatively small.
ard that during those years Swift g.
Co's profits have not exceeded . per
cent. of the total sales; Cudahy & Co.'S
are stated at l.S per cent. for 1904 and
2.3 per cent. for 1902.
No Evidence of Trust.
With reference to the private car
stated the profit Is q very liberal one.
q net return from IA to II per cent.
being Indicated: but it is added that
reckoned on the basis of dressed beef
transported the profit would add but
little to the cost of beef to the con-
sumner.
The profit OF II concern, the Cuda-
ny Packing company. on its investment
In cars was as high as % per cent. in
one year.
The report. In conclusion, saws the
National Packing mentioned
as one of the big six," is a merger of
various packing plants. but except for
mat concern there appears to be no
general interownership of stool, among