434 ANNUAL REPORT OF THE Off. Doc. 



FERTILIZER VALUATIONS, 1914 



The object of an official valuation of commercial fertilizers is to 

 enable the consumer to Judge approximately whether he has been 

 asked to pay for a given i)rand more than the fertilizing ingredients 

 it contains and market conditions prevailing at the time would war- 

 rant. It is clear, therefore, that no attempt is made in this valua- 

 tion to indicate whether the fertilizer valued possesses a greater or 

 less crop-producing capacity than another fertilizer; but only whether 

 it is higher priced than another of the same general composition. 



For this purpose the valuation must be so computed as to include 

 all the elements entering into the cost of a fertilizer as it is de- 

 livered to the consumer. These elements differ with the conditions 

 of sale. Sales to consumers fall chiefly into two classes: (1) Those 

 made directly from the jobber or manufacturer to the consumer, 

 without the service of a local agent or dealer. Such sales are usually 

 in relatively large lots for cash. (2) Those made through a local 

 agent or dealer. These are most commonly made in relatively small 

 lots and often with arrangements for deferred payments. 



In some states, the valuations are so made as to represent sales 

 only of the former class. In Pennsylvania, however, the principal 

 volume of sales is of the second class, and the method of valuation 

 has, therefore, included the additional cost elements involved in 

 this mode of sale. The several cost elements or factors may con- 

 veniently be grouped as follows: 



1 . The wholesale cost of the ingredients. 



2. The jobbers' gross profit on the sale of the ingredients; this 

 includes office expenses, advertising, losses, etc. ; for the purpose of 

 the present computation it may be assumed that the sum of this 

 gross profit and the wholesale cost of the ingredients, is equivalent 

 to the retail price of the single ingredients near the wholesale mar- 

 kets in ton lots of original packages for cash. 



3. The expense and profit of mixing: This item applies only to 

 complete fertilizers, rock and potash, and ammoniated rock; not to 

 dissolved or ground bone, or to dissolved rock. 



4. The expense and profit of bagging. 



5. Agents' commission: This item includes not only the commis- 

 sion proper, but every advance in price due to the sale of the goods 

 through an agent in small ouantities on time, rather than directly 

 to the consumer in ton lots for cash. 



6. Freight from the wholesale market to the point of delivery. 



The valuations for 1914 are based: 



1. Upon the wholesale prices from September 1, 1913, to March 1, 

 1914, of the raw materials used in fertilizer manufacture, the quota- 

 tions of the New York market being adopted for all materials ex- 

 cept acidulated phosphate rock and ground bone. 



2. Upon an allowance of 20 per cent, of the wholesale prices, above 

 mentioned, to cover jobbers' gross profit. 



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