The Mankato free press. [volume] (Mankato, Blue Earth County, Minn.) 1879-1924, 1920-11-19
Urge COOPERATIVE PLAN !:
IUGHJ. HUGHES SA KS THAT
STATE MUST SUPERVISE
Farmer Should Assume Risks of
y The Middle Man, He
Contends
ASSOCIATED Press Dispatch. ]

ASSOCIATED Press Dispatch.l
St. Paul, Mimi. November IL
State supervision of machinery for
marketing CO. operative ownership Of
retail agencies by farmers are recon-
mended in q report by Hugh J..
Hughes, director Of the Minnesota
department. OF agriculture, made pub
&c today. The report deals with the
results of an investigation by the
department.. into conditions affecting
he marketing of farm products,
which was ordered by the 1919 legis-
allure.
Cooperative ownership by the
farmers Of the machinery of market
ne. at least as far as q poinc, where
the farm product loses Its identity or
where Il reaches retail distribution,
8 offered as the best availabls solu-
ton Of the farmers marketing prob
en-. says the report.
Saving to Consumer.
Co operative ownership OF retail
agencies such as grocery stores, meat
markets, milk depots and similar
places Is suggested by Mr.. Hughes as
airy expenses of living borne by the
consumer" State superintendent the
purpose OF establishing a fair bartem
md exchange is held essential
Mr.. Hughes said that local CO.
operative elevators create q central
telling agency. Such agencies should
hold membership In any grain ex-
change TO which it can find Q market
Ing outlet, continues the report, and
he board OF directors Of the central
organisation should be empowered to
constitute itself corporation to deal
IN grain, to comply with rules of the
Tarious boards Of trade In order to
bbtain membership in them. As an
Alternative plan, the report ruggests
creation OF a central association to
sct Independently Of existing grain
exchanges and in connection with like
sales agencies In other states.
Create Active Market.
"A problem before such an organi-
Eation In that Of commanding a suf-
ncient volume TO create an active
insure profitable sale for the crop
consigned to Il, upon a market at
least as wide as that provided by
existing agencies" the report adds.
Discussing the proposition as to
the farmer becoming middle man.
Mr.. Hughes writes: y "The substitu-
ton OF federation CO. operation for
The services rendered by the jobber
Dr. the Wholesaler Is a matter that
must be determined in each line Of
farm production. strictly on the bust
normal sales period Of wheat was,
only a generation ago, but little
more than a month. Conditions to-
day. including car shortage and
greater ability Of the farmer to g.
nance his crop, have spread this
period OF wheat sale to practically
The entire year 1t has been the func-
ton of the middleman to handle the
crop. This Is a highly speculative
undertaking. involving risk that nee
sssitates q somewhat wide margin OF
against losses due to price fiuctua-
tons. IL the farmer takes over this
phase OF distribution, he autoMati-
eally assumes the risks inher!tent to
the middleinan- Theeb risks can be
absorbed and insured against, by
adopting the CO. operative principle
q marketing"
First add urge oooperatice plan
Comparison Is Same.
"A comparison OF private business
and cooperative business helps to
udk0 Cl0oI WHY OOOpOl oSLNo Va ScS4AA
ration not infrequently md Difficult
ties In securing needed banking as
business, his tangible assets and his
sistance In private business the basis
Of credit is the character OF the indi-
vidual and the performance OF his
volume. The bank loans, apparently
on the basis Of tangible assets.
TN cooperative business the same
essential credit requirements hold. 1t
H necessary for the cooperative as
ISOLATION to give the banking inter
ssts reasonable assurance OF perma-
nence. THIS requirement is fully met
by the cooperative association when
it issues capital stock, establishes a
place Of business, and chooses a man
aeemenf In which men have confi-
dence.
Similar programs are advocated
for the handling Of farm timber, eggs,
hay and roughage wool, dairy pro-
ducts and other farm products.
Taking up tho matter of livestock
marketing, Mr.. Hughes says:
Livestock 10 Discussed.
eat least seventy percent OF the
livestock In Minnesota is shipped
through cooperative associations.
There "a reason to doubt whether the
present form Of organization 10 suf-
hcieotty substantial as basis on
which 30 build q terminal selling
agency. The need Of such an agency,
through which the farmer can come
direct TO the packer is apparent, and
FROM eve--- etnrdnoint desirable It
q suggested: First that local asso-
Citations incorporate under the corpor-
ative law of 1919, with capital stock
sufficient to make good any agree
ments entered INTO with the central
agency. Second In order to insure q
dependable volume of business, the
local association contracts their bust
ness for a term or yeart to the CEN
trail association.
Third that central sales agency,
reporting local associations the
created to receive and sell livestock.
Fourth that such sales agency be
made, II desired by the farmers, q
member Of an existing livestock ex-
change on terms assuring the farm
er the maintenance of cooperative
principle Of profits distribution on the
basis OF patronaee."