The producers news., 1919-04-25
ELEVATORS EARN CASH
UNDER MUNSTER
SYSTEM"

why uol Oil farmers elevators
IN the spring wheat states finance
their own grain movement, as one
enterprslng manager has proven can
be done, and instead OF paying out
$2OO month interest (as many of
them frequently do) earn that inter
est and put it into their own fund?
That all communities where farm
erS are not hard pressed for spot
cash TINS can be done easily, az has
been proven by F. H. Durham, mana
ger of the Munster Equity Elevator
company at Munster, N. D. Gener-
ally the farmers elevator establishes
line OF credit with the terminal
so @s 10 be able to pay cash for each
load as 1t is received. For this cred
II 1hey nave to pay a current inter-
est and the only advantage is that
the farmers gets his money as soon
as he dumps the grain.
Inder the Munster system the
farmer does not get cash that day,
hut he gets cash in full as soon as
his car is sold. That is the way the
livestock associations operate they
wait for sale and the pro-rating OF
their returns, but the habit OF the
gram farmers has been to demand
spot cash. The Munster system"
has broken one big, prosperous COM
munlty Of farmers of this spot cash
habit and they are better satisfied
than they ever were before.
When old line elevators began to
refuse grain on both sides Of the
Munster house, because of the short
age of cars last fall, Manager Dun
ham also conserved his cash balance,
but he offered to buy all wheat Of
fered if the farmers would wait for
their pay until the grain was sold.
$:me hes -lteu at h:s, AIT few
venturesome spirits began hauling
and taking storage tickets instead Of
cash.
The Munster house somehow kept
getting cars and shipping grain, and
the farmers kept on hauling, while
the old line houses, timid because Of
the embargo" refused to buy load
because they were afraid to invest
their cash in wheat. But Munster
"just sawed wood and said nothing"
At the end of two weeks the first
returns came back and the farmers
put cash in full in the bank.
That was right where it would
have lain during that two weeks if
they had got the spot cash and the
farmers knew it. They were just as
we'll off and they knew that too.
They had waited 10 days to two
weeks-but they had saved interest
on the large fund it would have re-
quired to pay them spot cash, and
instead of paying out, interest, had
actually earned interest.
Under the Munster system" this
one farmer-owned house shipped
10000 bushels of grain between De-
cember and April, and had a credit
balance at the terminal market of
$4,000 to $4,000 upon which the
Equity COOPERATIVE Exchange was
paying the farmers current interest.
They actually earned s197 in inter
est and saved all the difficulty and
cost of financing the grain move
ment" from that section-just be-
cause the grain farmers were willing
to take the same chance as the live
stock farmers and wait until they
could get returns on their cars.
every farmers elevator in the
country could do the same" said
Manager Dunham in an interview
in ST. Paul the other day. "1f they
would only establish this method it
would save them all the trouble of
raising the money. Anyone who has
to have spot cash can always get it
we always paid when they demand
ed, for we had a cash balance on
hand. If they would, they would be
free from the big financial burden
which is serious for so many houses
under the old habit of insisting on
spot cash every time you dump
load"