THE I. A. A. RECORD 



Page Thirteen 



Cream Producers and 



Butter Mfgrs. Cooperate 



4. 



First Contracts with 111. Produce 

 Marketing Assn. Arrive 



AS we go to press the first signed agree- 

 ^ ments between the Illinois Produce 

 Marketing Association and butter manufac- 

 turers who buy Illinois cream are being re- 

 ceived. 



Signed contracts have come in from the 

 Pioneer Creamery Co. of Galesburg, Emster 

 Bros, of Chicago, which are now buying the 

 total output of five local produce marketing 

 associations, the Murphy Butter and Egg 

 Company, Chicago, and the Egyptian Dairy 

 Products Company of McLeansboro, Illinois. 



The new plan of producer-manufacturer 

 co-operation recently announced in the 

 press represents a departure from the usual 

 method of marketing farm products. The 

 marketing agreement is to run between the 

 Illinois Produce Marketing Association, a 

 co-operative representing some 10,000 or- 

 ganized producers of butterfat from 36 

 counties of the state, and butter manufac- 

 turers who buy Illinois cream. ;y ,... 



The plan provides that the farmers are 

 to share equally with processors in all profits 

 left after expenses of operation are paid 

 and three-fourths of a cent per lb. is allowed 

 the manufacturer as interest on invested 

 and operating capital and good will. 



The price schedule varies with the 90 

 score Chicago butter market as follows: 

 frice Range Premium 



2J— 293^ . ■ j^jjj^j y^^ 



30— 34J^ ^ Plus '74^ 



35— 39% ^ 



40 — 44J4 



45—49% V-i . 



JO— 54% 



55—593/4 



The premiums above are added to the 

 Chicago 90 score butter prices on a sliding 

 scale basis. 



Three Grades Cream 



Three grades of cream are to be recog- 

 nized, namely, sweet cream. No. 1 sour 

 cream, and No. 2 sour cream. The prices 

 quoted above apply on No. 1 sour cream 

 which ranges in acidity from .3 to .6 per 

 cent at point of delivery. When 25 per 

 cent of the total current receipts at any lo- 

 cal marketing unit consist of sweet cream, 

 the processor agrees to pay for the sweet 

 cream on the basis of the foregoing schedule 

 based on the 93 score butter price. The 

 No. 2 sour price is based on the 88 score 

 butter market and onion cream is to be 

 ■ docked five cents per lb. below the No. 2 

 price. 



The Marketing Association is to have ex- 

 clusive control of the weighing, grading, 

 and testing of all butterfat, and to assume 

 all obligations for the cost of such weigh- 

 ing, grading, and testing. The processor 

 has the privilege of rechecking on grades, 

 weights, and tests. 



1%* 



Eliminate Waste 



"One of the chief advantages of this co- 

 operative agreement," states Frank Gougler, 

 director of produce marketing for the Illi- 

 nois Agricultural Association, "is that much 

 waste and expense in assembling the prod- 

 uct will be eliminated. An effort will be 

 made to allocate cream to the nearest but- 

 ter manufacturer and save criss-cross haul- 

 ing," continued Gougler. "Wasteful com- 

 petition between processors fighting to se- 

 cure a larger volume of the raw product 

 will eventually be eliminated when the pro- 

 ducers of every county are organized. 



"At present some towns have as many as 

 five or six local cream buying stations repre- 

 senting as many manufacturers. By co- 

 operative organization farmers hope to re- 

 place these private cream stations in a given 

 town, with one co-operative marketing unit 

 where all the cream in the adjacent terri- 

 tory will be assembled and sold through one 

 channel." 



Committee of Three 



The administration of the plan is left to 

 a committee composed of three producer 

 and three processor representatives. The 

 following have been designated to serve un- 

 til their successors are chosen: Earl C. 

 Smith, president, and Geo. E. Metzger, sec- 

 retary of the Illinois Agricultural Associa- 

 tion; and S. M. Elkins, president of the 

 Illinois Produce Marketing Association for 

 the producers. For the processors; T. F. 

 Canfield of Swift & Co., Chicago; T. A. 

 Borman of the Beatrice Creamery Co., Chi- 

 cago; and N. W. Hepburn of the Peoria 

 Creamery Co., Peoria. 



The processors on the Administration 

 Committee are elected for one year. Each 

 processor signing the agreement is entitled 

 to one vote, and in addition to one vote, 

 each is entitled to another vote for every 

 500,000 lbs. or major fraction thereof, of 

 butter churned in plants receiving sour and 

 sweet cream from the Association during 

 its last fiscal year. 



This Committee is charged with the arbi- 

 tration of all controversies, allocation and 

 reallocation of cream to the processors, ad- 

 justment of grades, weights, and tests when 

 differences arise, and encouragement of co- 

 operative produce marketing. ■.. ., 



May Select Referees 



In case of disagreement the members of 

 the Administration Committee are to select 

 two referees; one representing the pro- 

 ducers, the other the processors. If they 

 cannot agree the two referees shall select 

 an umpire. The unanimous decision of a 

 matter by the referees, or a majority vote 

 of the referees acting with the iimpire will 

 be binding upon all parties. 



If the producers are not satisfied with 

 the report and accounting of the processors 

 on net profits, the Administration Commit- 

 tee shall appoint an independent auditor to 

 check all records. The finding of such re- 

 port and audit shall be binding upon both 

 parties, and the cost thereof shall be borne 

 equally by processors and producers. 



Supply Cans, Etc. 

 The manufacturer agrees to furnish all 

 cans, tags, seals, and other equipment used 

 in the transportation of cream. If fanners 

 can deliver cream cheaper to the manufac- 

 turing plant than the present cost, they will 

 have the right to do so, the processor allow- 

 ing the producer the true per lb. cost of 

 transportation from the country assembling 

 point to the plant. 



The right of contract is extended to all 

 processors who buy cream in Illinois. The 

 contract is to remain in force until Decem- 

 ber 31, 1931, and continues thereafter un- 

 less either party gives notice during Sep- 

 tember or October of its desire to terminate 

 the agreement, at the end of that year. 



The Illinois Produce Marketing Associa- 

 tion already has a membership of 22 coun- 

 ties. The rest of the county co-operatives 

 are expected to afEliate with the State As- 

 sociation shortly. 



Several Conferences ! 



The agreement was drawn up following 

 frequent conferences between producers and 

 processors during the past six months. 



"The producers recognize that the build- 

 ing of co-operative butter manufacturing 

 plants would more or less duplicate those 

 already in existence," according to Mr. 

 Gougler. "The purpose of th^ plan is to 

 promote efficiency in the assembling and 

 manufacturing of butterfat so as to give 

 the manufacturer a chance to make a fair 

 profit and at the same time to assure the 

 producer a fair price." 



Gougler predicts that the plan will have 

 a far-reaching influence in improving the 

 quality of Illinois butter because of the 

 grading system estabUshed, shortening of 

 the haul to the creamery, and payment 

 based on quality of cream delivered. 



NOTICE 



ELECTION OF DELEGATES 



ILLINOIS AGRICULTURAL 



ASSOCIATION 



Notice is hereby given that in connec- 

 tion with the annual meetings of all County 

 Farm Bureaus to be held during the 

 months of May and June, 1930, at the 

 hour and place to be determined by the 

 Board of Directors of each respective 

 County Farm Bureau, the members in 

 good standing of such County Farm 

 Bureaus and who are also qualified voting 

 members of Illinois Agricultural Associa* 

 tion shall elect a dele^te or delegates to 

 represent such members of Illinois Agri- 

 cultural Association and vote on all mat- 

 ters before the next annual meeting or any 

 special meeting of Association, including 

 the election of oflicers and directors as 

 provided for in the by-lawt of the As- 

 sociation. 



During the month of June, such meet- 

 ings will be conducted in the following 

 counties: Ogle, June 3. 



During the month of July no such meet- 

 ings will be conducted. 



Signed - t ">;." 



G. E. METZGER, Secretary. 

 April 4, 1930. 



• I ; 



