538 IOWA DEPARTMENT OF AGRICULTURE 



weekly relations between the prices of cattle and those of beef and by- 

 products. These show price ratios between the cost of the live animal and 

 the value of the beef and by-products ranging all the way from 1 to .95 up 

 to 1 to 1.27, the ratios being obtained by dividing the indicated value of the 

 beef and by-products by the cost of the animal. These graphs indicate 

 that the ratio is most favorable to the slaughterer when the prices of beef 

 are advancing rapidly, and that they are the most unfavorable when beef 

 prices are declining rapidly, which justifies the statement that the prices 

 paid for cattle lag behind on advances and on declines. It is per- 

 haps also worthy of note that during the summer and fall, when the prices 

 of beef and by-products were fairly stable for a number of weeks and the 

 variations in the prices paid for good beef steers were very small, then the 

 ratios varied between 1 to 1.10 and 1 to 1.15. As these figures are not 

 weighted at all for days or for weeks, they do not represent except in a 

 very general way what were the financial results of the packers' beef 

 operations on this class of cattle, but one is justified in saying that they 

 do not indicate that the packers were making any very large profits, and 

 there are some weeks that certainly indicate that they were meeting with 

 very considerable losses. 



It is to be regretted that the data on which these graphs are based 

 is so meager and so uncertain. It was for the purpose of trying to get 

 dependable information with which to support such investigations in order 

 to have a continuous record of such price relations that the schedule 

 of desired information was submitted to the packers. But until some 

 plan can be worked out which will make such information available, de- 

 pendence will have to be placed on such sources as can be found. 



Some general conclusions can Ue drawn from the total of the informa- 

 tion furnished by these various charts and tables. The first is that pro- 

 duction of these better grades of fed cattle if left entirely to individual 

 Initiative is not apt to be very well adjusted to consumptive demand. 

 It is very plain that a year ago this time too many feeders decided that 

 the May and June markets would be good ones to feed for, and that 

 many thousands too many cattle were put in the feed yards in preparation 

 for those months. The result of this was the flooding of the market 

 during this period with good and choice corn fed cattle and a disastrous 

 decline in prices. In the past such a situation has adjusted itself by the 

 next year most of the feeders who lost in such a maladjustment not feed- 

 ing or feeding for a different market, and in the same period the receipts 

 ran far short of the consumptive demand and the limited number of feed- 

 ers who had cattle ready for that time received a high price; that is, 

 excessive receipts during a particular period one year having caused 

 losses, the same period the next year is apt to have deficient receipts and 

 instead of production being more or less adjusted to probable demand it 

 is influenced very largely by the experience of the previous year. Such 

 a condition does not make either for a stable or a prosperous industry so 

 far as the great bulk of feeders are concerned, and it is fairly evident 

 that it is no more satisfactory to the manufacturing and distributing in- 

 terests of the industry. 



A second conclusion is that the distribution of the production when 

 it is ready for market, controlled as it now is by individual action as in- 



