Evening star., 1924-07-28
IN TODAY'S SPOTLIGHT
BY PAUL y. COLLINS

books of the vendors indicate. as the
basis of the valuation of the good will
of the going concerns?'
What is the outlook for American
grain exports in the next decade?
These are some Of the pertinent
questions asked. Under the merger
1t Is expected to absorb the trade and
good will Of the 1000 or 5000 CO.
operative elevators, with their pa
tronage of some million grain raisers.
When the five years limit Of the pur-
chase contract will have expired,
these farmers elevators and their
business will have been absorbed or
been put out of competition by the
agement of the holders of the merger
debenture stock. If then the merger
property falls back to the vendors or
their successors, all that farm CO.
oper alton will be dead.
X X X x
Not all cooperative marketing has
proved profitable to the producers.
Cooperation is not a substitute for
knowledge and judgment of world
market conditions. A survey of CO.
operative elevators of the Northwest,
made by DR.. Edwin G. Nourse and
his class of students in the Iowa Col
lege of Agriculture showed enormous
losses, due to overoptimism and mis-
taken judgment of the farmers At
one elevator corn was being shipped
out at 30 cents for which the owner
That elevator had a deficit of over
$4,000 on one years business.
Farmers who refuse current prices
are shocked to be told that they
are as truly 'speculating" as the
gambler who buys on margins. The
90 hair
safeguard their speculations, as do
the ga mi b1ers," by hedging-seIIine
short. for future delivery at a fixed
price, when they are not yet ready
to ship. How safely will they guide
the merger sales of their grain?
DR.. Nourse, who is now connected
with the Institute of Economics.
Washington, says in a book Just pub
ished by the institute, under title of
american Agriculture and the Euro
pean Market:
Cooperative marketing, when
wisely organized and managed. holds
out great promise of somewhat funda-
mentally overhauling the whole sys-
tenn In certain trade lines rather
crudely organized in the past I'm
fortunately. in many places there
nave been sizable losses to offset such
gains as nave been made. These
losses nave been due to the blunder-
ing efforts of persons who sought
10 make sweeping improvements in a
marketing machinery whose work
lngs they were far from understand
ing.
Furthermore. the trouble has
sometimes come from persons of the
promotional type, who saw in the
farmers simple faith in market pan
aceas a rare opportunity for financial
exploitation
Even at best the possible savings
in marketing would have been sadly
inadequate to recompense the grower
for the drastic declines in price
which have taken place. Where 1t
takes Is cents bushel to market
grain, 10 per cent saving (such as
would be really quite an achievement
in market reform) would do compar-
aiively little to mitigate the disaster
of price fall from s2.10 august.
1879, to AZ cents bushel October,
IaeD, as happened with corn in the
Chicago market
The promoters of the present mer-
ger do not talk so much about a 10
per cent saving in marketing costs as
they do OF the possibility of control
ling the market price by the volume
OF business under one management.
How capable they will be of doing
that in America may be considered
from the standpoint of tho lesscning
surpluses for export which America
is likely to have in tho next ) or 10
years. Our increase of population. at
100000 II year, will enhance home
consumption of wheat some 100000
bushels year, but the reduction of
@ 10 at
more rapid pace than that indicates.
for we cannot compete with the cost
of grain production in Canada and
Argentina and other pioneer regions;
and greater profits in other crops, in
cluding meat animals. will hasten the
day when this country will be
grain importing nation per h a p s
within a decade. Do the great grain
dealers see through the veil Of the
future more clearly than do the
farmers?
Copyright, 1924 by Paul V. Collins)