The Birmingham age-herald., 1921-07-23
PRICES OF FARM MACHINERY

To the Editor of The Age Herald:
 In your issue of Sunday. July IT, appears a lengthy statement from M, c. Allgood, Alabama commissioner of agriculture, condemning the farm machinery manufacturers for con- tinued high prices of their products and urging the farmers to declare war against the implement trusts and keep out of the hardware stores"
 I know nothing of MT. Allgood save that understand he expects to be candidate for Congress at the next election in district composed al- most entirely of farmers-and if this is the case, it is not difficult to un- derstand the reason for this appeal to class prejudice and this play for the farmer vote.
 However, in justice to the many implement manufacturers who have already suffered staggering losses in the readjustment of business, and in the interests of the hundreds of hard ware and implement merchants Of Alabama who are striving to serve the farm trade efficiently while handicapped by a tremendous burden of farmers accounts long past due in simple justice to these people reel Indl you Suoulu DIiHl iHlS Sldlc- ment designed to clarify the situa- ton and reveal the inconsistencies and inaccuracies of MT. Allgood's re- marks.
 In the first place prices of farm machinery are now and always have been priced most reasonably com pared with prices of other manufac- tured proudcts. The latest price in- dex numbers received from the United States department of commerce, based on 1913 as normal pre-war year and using 100 to represent the price level of that year, show that the price level in May, 1921, was as follows: Clothes and clothing, 1S1; fuel and lighting. 194; building ma terials. POP; chemicals and drugs 166; house furnishing goods, 262. No price comparisons are made on farm ma chinery but the fact is that using 100 as Aasis to represent 1913 prices, 165 would fairly represent the average of farm implement prices to- day
 In the light of these figures, Is there any reason why the farm im- plement trade should be singled out for condemnation?
 There are some farm implements which are selling today at more than ga per cent above pre-war prices. For instance, certain type of walking blow which sold at S5 before the war Is generally priced at $9 today. The price last year was $11.25. On the other hand, some implements are selling at considerably less than 65 per cent above pre-war prices. For instance, a moving machine which usually sold at $70 before the war is generally priced at $100 today; while several tractor manufacturers re- gently reduced their prices to the point where several of their models tractors which have been on the market, for many years-are quoted at the lowest prices that have ever been placed on them.
 On the other hand prices of farm machinery advanced very slowly as compared with prices of other com modities, and even farm products. The federal trade commissions in- vestigation of the implement indus. try covering the years 1914 to 1918 makes this comment regarding im- plement prices: The increase in the prices to the farmers during the five year period 1914 to 1918 averaged T3 per cent. The greater part of this in- crease occurred in 1918 The increases in 1914 and 1916 were quite small.
 And yet. while in 1918 farm ma chinery was costing the farmer but 73 per cent more than pre- war prices. cotton middling at New Or leans had advanced to more than S5 cents pound. or an Increase of 2S1 per cent above the pre-war average of le.7 cents in 1913; wheat and corn had both advanced more than 250 per cent; hogs had advanced 2S5 per cent. Does 1t appear from these figures that the farm Implement industry ever profiteered at the expense of the farmers?
 The fact is that the Implement manufacturers did not lay up any profits during the war period suffi- cient to take care of the losses which are now being incurred. The report of one of the largest farm imple- ment manufacturers for the year 1913, the most prosperous in its his, tory. shows a net profit of less than 10 per cent on it's capitalization. And yet this same concern. in reducing its prices in April of this year, had to write off loss on it inventory of more than sS0o0 900.
 At the peak price of 1920 the aver age price Of farm machinery had ad- vanced to 9S per cent above pre-wsr prices. Since then reductions have been made in all lines just as rapidly, in most cases, than production costs would justify.
 The Implement industry is peculiar in that It's products are made up, on the average, nearly year before they pass into the hands of the farm CTS. In 1920. in order 10 be able to have. the usual stocks of implements, at the disposal of the farmers in 1921, the manufacturers bought the usual supplies of raw material-and at thes highest prices ever known. This raw material was made up by labor which was receiving more than 100 per cent above pre-war prices.