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Illinois Leads in Grain Marketing 



By Harrison Fahrnlcopf 



DUE to its production of surplus 

 grain Illinois has always ranked 

 high among the states in grain 

 marketing. In production of grain and 

 in co-operative marketing our state is 

 a leader. Although the state is but one 

 of 48, it sends to market one-seventh of 

 all the grain in the United States that 

 moves out of the territory vrhere grown. 

 In other words, if there were six more 

 states that furnished for commercial 

 channels as much grain of all kinds as 

 Illinois, these seven together would send 

 all of the grain which moves from 

 farms to commercial markets in the 

 United States. 



Furthermore, one-fourth of all the 

 corn which moves in the channels of 

 trade is shipped out of Illinois coun- 

 ties. We can well feel proud then of our 

 state as a producer of surplus grain 

 products. 



450 Farmer Elevators 



It is logical, therefore, that there have 

 been developed in this state facilities for 

 marketing grain second to none in the 

 country. At the local stations we have 

 about 450 farmer elevators and approxi- 

 mately 1,500 privately-owned grain ele- 

 vators operating. In the terminal mar- 

 kets, such as Chicago, Peoria, St. Louis 

 and Indianapolis, to which Illinois grain 

 is tributary, huge elevator facilities have 

 been built and many grain firms es- 

 tablished to handle Illinois' annual flow 

 of golden grain. 



The first efforts of Illinois farmers 

 in marketing grain co-operatively were 

 made at the country shipping point. The 

 co-operative farmer elevator came into 

 the picture in Illinois approximately 50 

 years ago. The movement grew until 

 there are today about 450 such elevators 

 in this state. The development in this 

 field is an old story. There is little to be 

 accomplished by dwelling on it here. 



As far as terminal markets are con- 

 cerned, the producer only in recent years 

 has made substantial progress. The out- 

 standing agency in co-operative market- 

 ing of grain which operates throughout 

 all the terminals of the country is 

 Farmers National Grain Corporation 

 which was organized in the fall of 1929. 

 The Illinois Grain Corporation, which 

 operates as a state regional for the 

 Farmers National, was organized early 

 in the year 1930 being incorporated 

 February 17 of that year. 



Long before Illinois Grain Corporation 

 was set up, the Illinois Agricultural As- 

 sociation had been making a study of 



the entire grain marketing situation. It 

 had long believed that for the producer 

 to realize the greatest return fnr his 

 product it was necessary that he have 

 representing him in the terminal mar- 

 kets a strong marketing agency. When 

 the Farmers National Grain Corporation 

 came along the Illinois Agricultural As- 

 sociation recognized in this agency an 

 opportunity to benefit the producer. Ac- 

 cordingly, Illinois Grain Corporation 

 was started. Today the corporation has 

 a membership of 200 local elevators and 

 member co-operatives. 



The process of growth has not been 

 rapid. In the field of membersh'O ac- 

 quisition, obstacles are bound to arise. 

 Illinois Grain Corporation has had some 

 robust opposition but such opposition 

 has served to prove as a testing g:round 

 for the young co-operative. 



We have heard the remark that Farm- 

 ers National Grain Corporation "is just 

 another commission company." It is just 

 another commission company — PLUS 

 and the plus means a great deal on the 

 vside favorable to the farmer. It is the 

 gioal of the co-operative to pay the 

 highest possible price for grain, in other 

 words to buy grain as high as it can 

 rather than at the lowest price. It 

 would be as unreasonable to say thit 

 the farmer elevator is just "ane-the'" 

 elevator." The farmer elevator does and 

 should serve the producer in a man- 

 ner that "just another elevator" does 

 not serve him. 



A Real Co-operative " 



The farmer does not think of Farmers 

 National Grain Corporation as those op- 

 posed to co-operative marketing wou'd 

 have him think of it — as a governmental 

 agency associated with politics. Even 

 though organized under the direction of 

 the Farm Board it does not stand out in 

 the farmer's mind as an instrument of 

 party politics. Instead, the Farmers 

 National Grain Corporation represents 

 a finished product in co-operative mar- 

 keting efl'ort and experience over a long 

 period of years. 



A recent issue of the Co-Oo Reporter 

 under the caption "Not Bad For A Six- 

 Year-Old" says:— 



"It (Farmers National) is not 

 subsidized by the federal govern- 

 ment, unless any firm, with money 

 borrowed from the federal treasury, 

 can be said to be subsidized by 

 ••■• 'n which case the banks, 

 the railroads, the insurance com- 

 panies, the buildmg and loan as- 

 sociations, the shipping interests. 



and many others, are being sub- 

 sidized. Farmers National does have 

 money borrowed from Farm Credit 

 Administration, but the average in- 

 terest rate on all its borrowings 

 from that source is no lower than 

 the current commercial rate. More- 

 over, the debt is funded over a long 

 period, and at regular interest and 

 principal paying times, Farmers Na- 

 tional has laid the money on the 

 line promptly. 



"Its loan with Farm Credit is in 

 good standing, despite the McNary 

 report and others to the contrary. 

 So eminent an authority as F. W. 

 Peck, cooperative loan commission- 

 er of Farm Credit Administration, 

 who is in charge of such loans, says 

 so. Borrowings of the Corporation 

 for grain merchandising come 

 largely from commercial banks, and 

 at interest rates as favorable as 

 those granted to its strongest com — ■ 

 petitors. With close to 40,000,000 

 bushels of terminal elevator snace, 

 located to serve the largest and best 

 mills in the country to advantage, 

 and backed as it is by regional co- 

 operatives, many of which have heen 

 serving successfullv for 20 or 25 

 years, it is small wonder that trades- 

 men oppose it constartly with every 

 device at their command. 



"Wh°n you're inclined to grow dis- 

 couraged with the seemingly slow 

 progrress of cooperative marketing, 

 take a look at your own organiza- 

 tion! Then remembei also that it " 

 forms but one sector in the co- 

 operative pattern. Nationals in four : 

 or five other commodities, backet! by 

 millions of individual producers, are 

 doing excellent work in their re- 

 spective fields. Then there is the 

 purchasing side of the cooperative " 

 movement, doing something like 

 $200,000,000 worth of business a " 

 year. Snap out of it fellow! You're 

 connected with the biggest, fastest- 

 growing movement on earth." 



Fair Price Is Goal ■> 



In marketing grain co-operat'rely, 

 volume, of course, is a factor but a fair 

 price to the producer for the grain he 

 markets is far more important than vol- 

 ume. The ideal or goal of the co-oper- 

 ative is to see that the producer receives 

 that fair price. This ideal, which does 

 not necessarily dominate the aims and 

 purposes of other marketing ag^encies, 

 gives a distinct label to co-operative 

 marketing organizations. With a good, 

 strong co-operative in the terminal mar- 

 ket the farmer has a friend who is on 

 the job looking after his interests at all 

 times. .. ^ ■..•.,. -r 



DECEMBER. 1935 



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