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!> Obstacles To Fair 

 f Livestock Prices 



By R. C. Ashby, University of Illinois, before anhual meeting 

 Chicago Producers Connmission Association 



OTATEMENT of the subject of this 

 ^^ paper immediately raises two ques- 

 tions: (1) what is meant by ob- 

 stacles; (2) what are fair livestock 

 prices. For purposes of this discussion 

 obstacles are any hindrances or impedi- 

 ments that delay or prevent needed ac- 

 complishment. In seriousness they may 

 range from simple detours on the mar- 

 ket highway to complete washouts. Fair 

 prices are assumed to be those which 

 would prevail if every group which op- 

 erates between livestock producers and 

 meat consumers was so organized and 

 so operated as to render maximum serv- 

 ice in the most effective and most eco- 

 nomical manner possible. 



Actually most groups now operating 

 between stockmen and consumers are 

 seeking maximum financial returns, and 

 are rendering service only in proportion 

 as it promises to expand such returns. 

 The resulting conflicts of interests be- 

 tween groups make difficult the develop- 

 ment of frank and open-minded discus- 

 sion of the problems at issue. Yet such 

 discussion is essential to effective solu- 

 tion. 



That the need of such approach is real- 

 ized in the meat packing industry is 

 shown by the two statements that fol- 

 low. Said a well-known eastern packer: 

 "The meat packing industry cannot 

 really be on a permanently satisfactory 

 basis until all groups — stockmen, pack- 

 ers, retailers and consum«rs — understand 

 the primary problems involved, and co- 

 operate in meeting them." A nationally 

 known Iowa packer operator says: 

 "Whether we agree or disagree on cer- 

 tain angles of livestock marketing is 

 secondary to the honest presentation of 

 facts as we see them. It is only by the 

 continued practice of this policy that 

 fair-minded men can eventually agree 

 upon a plan that will advance the inter- 

 ests of Agriculture." 



It is in the spirit of those two state- 

 ments that this presentation is undertaken. 



Since any defect in current livestock 

 marketing practice may, and usually 

 does, constitute an obstacle to fair prices, 

 the number of obstacles that might be 

 enumerated is large. Eight of the more 

 important ones have been selected for 

 consideration here. 



First, becaXise af absence of a clear 

 undertanding of basis livestock market- 

 ing problems and lack of adequate and 

 accurate market information, too many 

 stockmen and farmers are themselves 

 often obstacles to fair livestock prices. 

 Nor is this so surprising. It is largely 

 within the last twenty years that any ^ 

 considerable number of stockmen have 

 begun to regard livestock marketing as 

 "any of their business." And twenty 

 years is a short time in which to inform 

 thousands of producers regarding a busi- 

 ness so intricate, so complicated, and so 

 complex as that of marketing — process- 

 ing — distributing some 75 million head 

 of meat animals slaughtered annually 

 under United States federal inspection. 



One of the keenest analysts in the 

 livestock marketing field recently re- 

 marked: "Lack of clearer understanding 

 on the part of stockmen of the many 

 phases of livestock marketing is due part- 

 ly to the fact that market men have not, 

 as a group, undertaken to give stock- 

 men dependable and complete livestock 

 marketing information; partly to the 

 fact that concerns buying livestock from 



Here is a thought-provoking ar- 

 ticle on a much discussed and high- 

 ly interesting question — livestock 

 marketing. In it. Prof. Ashby 

 makes a good case for marketing 

 through Strang farmer-owned co- 

 operatives, whether they be organ- 

 ized in the country or at the termi- 

 nal markets. The author emphati- 

 cally discounts packer arguments 

 that the farmer will get a fair 

 price regardless of how and. where 

 he sells his livestock. His studies 

 show that there are wide fluctua- 

 tions in prices at different mar- 

 kets. The farmer has a better 

 chance to get what his livestock 

 is worth by supporting the co-op- 

 erative agencies that are working 

 for him. — Editor. 



IN THE WAY 



stockmen have presented only their side 

 of the picture — packers are engaged in 

 buying livestock in the manner which 

 appears to result in lowest cost, and 

 their presentation of marketing problems 

 is necessarily colored to serve their in- 

 terests; part of the fault is chargeable 

 to agricultural colleges which have re- 

 leased loosely thought-out data; publica- 

 tions of some professors on livestock 

 marketing have not reached the depth 

 that might have been expected; and the 

 Bureau of Agricultural Economics has 

 not helped greatly." 



On the other hand, there is more wide- 

 spread interest in marketing problems 

 than has been evident previously. Stock- 

 men apparently want to know where and 

 how they can get dependable informa- 

 tion. It must be obtained from many 

 sources, and stockmen must learn to ap- 

 ply the acid test before accepting any 

 of it — to ask who is the author; whom 

 does he represent; what are the inter- 

 ests of the organization or corporation 

 behind him; are they presenting the 

 whole picture or just part of it. More 

 and more propagandic material is like- 

 ly to be circulated. Only accurately in- 

 formed stockmen will be able to recog- 

 nize it as such. 



Further, we have the right to expect 

 that our agricultural colleges and ex- 

 periment stations will employ as respon- 

 sible livestock marketing men — whether 

 research, teaching or extension — only 

 those who have a thorough first-hand 

 knowledge of livestock markets and of 

 livestock marketing. The time has passed 

 when anyone endowed with a Ph. D. in 

 Economics is per se an authority on live- 

 stock marketing problems. The quality 

 of our institutional marketing work 

 would be greatly improved if it were 

 possible to require that every worker, 

 before appointment to a responsible posi- 

 tion, should have had at least two years 

 successful experience in actual commer- 

 cial marketing service. In Illinois no man 

 is accepted for appointment as a farm 

 adviser until he has had 5 years prac- 



) 



MAY, 1935 



:ii 



