298 IOWA DEPARTMENT OF AGRICULTURE. 



one concern got on track at the place of their factory i/^c under Elgin. 

 Any creamery making Extras or Specials, if it properly understand its 

 business, can get Ic above the New York market or its equivalent in any 

 large market. The New Yorlc market averaged 27.83c for the last nine 

 months, to which Ic premium must be added. The commission, freight 

 and drayage average about 2.59c. Deducting this from the quotation, plus 

 the premium, would leave a net return of 26.24c. According to the state- 

 ment of the centralizer in question its net return would be 27.08c. As- 

 suming that the smallest creamery could operate profitably at present 

 prices 400 cows and 50,000 pounds of butter fat per annum. If this 

 creamery got an average overrun of 18.5 per cent on the previous basis 

 of cost it could pay to its patrons 26.98c per pound. 



As a matter of fact, from the prices given by the centralizer in ques- 

 tion, it paid 24.43c, or 2.55c less than a 400 cow creamery could pay. 

 The cost of operation in this small creamery could be nearly doubled and 

 still the same price be paid to the farmer as those paid by the cen- 

 tralizer. 



There are approximately 500,000,000 pounds of creamery butter made 

 in the United States annually. Two alternatives naturally present them- 

 selves to those interested in the development of the creamery business of 

 the country. If a well organized co-operative or individual creamery can 

 pay, as shown in previous statements they are paying, 4.64c per pound 

 more than some of the leading centralizers can pay, which is the better 

 policy, to develop the co-operative and small individual creamery, or to 

 develop the centralizer system to such a degree that it will supersede 

 the co-operative and individual creameries. 



It is true that large amounts of money are invested at the present 

 time in central plants, but their investment is only a very small frac- 

 tion of the investment of the farmer. The investments in hand sepa- 

 rators of those farmers who patronize central creameries alonfe represent 

 more value than the entire property used by the centralizers. That 

 system should assuredly stand which will give the farmers the great- 

 est net return. Where there are less than 400 cows in the community 

 the only way for the farmer to sell his produce is through the cen- 

 tralizing plant, large or small, until the time shall come when there shall 

 be enough stock and suflBcient itnerest to organize and build a co-opera- 

 tive plant. 



When that time comes the farmers can assuredly very materially in- 

 crease the interest on their investment by operating their own plant. 

 This statement has been made a number of times by those who are in- 

 terested in the centralizing system. They cannot deny the fact, and yet 

 in the face of this, it will be found that there is scarcely a community 

 in Minnesota, Iowa or Wisconsin, or in any of the butter states in which 

 there are not at present active agencies being established for the purchase 

 of cream and its shipment to centralizing plants. Statistics amply show 

 that active co-operation amongst the farmers increases their economic 

 wealth. 



Let us see if the centralizing system has developed or is developing 

 the dairy industry in such a way that this result is secured. In 1905 

 creameries, cheese factories and condenseries paid the farmers of the 



