By Ray E. Miller 



ILLINOIS receives approximately 

 two-thirds of its total income from 

 livestock and its products. 

 \ In 1935 this amounted to $250,000,- 

 000.00, not including benefit payments. 

 In 1932 the comparable figure was 

 $164,000,000.00. Is it any wonder that 

 more* than 400 farmers were willing to 

 leave their homes and drive from ."lO 

 to 200 miles recently that they might 

 spend the day in considering some of 

 the probleirfs in marketing Illinois' big- 

 gest crop? 



What are some of these problems? 

 President E. A. Beamer of the Michi- 

 gan Livestock Exchange (also Presi- 

 dent of the Detroit Packing Company, 

 largest cooperative packing plant in the 

 United States), said recently. "We 

 need in livestock marketing not only a 

 clear windshield but ■we also need a 

 clear rear view. As we drive forward 

 we need to see where we are going. 

 But to make progress intelligently we 

 need also to look back and observe and 

 study the ground over which we have 

 traveled." 



Things Are Different 



Almost every livestock farmer is fa- 

 miliar with the changes that have 

 taken place in the livestock industry 

 during the last 15 years. Up to 1918 or 

 1920 the producer sold his hogs, and 

 many times other livestock, to the 

 country buyer. About this time the co- 

 operative shipping association came in- 

 to the picture. In most communities it 

 displaced the country buyer. Shipping 

 associations in turn have given way to 

 the live stock truck. 



The country buyer has drifted back 

 into some communities since the ship- 

 ping associations passed out. In many 

 instances he now ooerates a truck. 

 With the coming of the hard road and 

 the truck there came also numerous 

 country concentration points where 

 livestock can be bought by packers or 

 their representatives. Accurate figures 

 as to the volume purchased by packers 

 from livestock owners are difficult to 

 secure. But it is estimated that between 

 20% and 25% of Illinois hogs are sold 

 by farmers direct to the packers or 

 their representatives. 



Livestock producers, not only in Illi- 

 nois -but throughout the corn belt, had 

 a good start on a sound program in co- 

 operative marketing with the local 

 shipping association operating in the 

 country and the cooperative sales 

 agencies operating on the terminal 

 markets. But the new conditions re- 



14 



Firsf in s«les and service, the producer agencies on the terminal markets assure the grower all 

 the market affords for his livestock. 



It's the Modern Way 



Here Are Some Challenging Thoughts and A Few Pertinent 

 Questions For the Man Who Grows Livestock, to 

 Ponder In His Spare Moments 



ferred to have necessitated quite a dif- 

 ferent program. We may anticipate 

 continued changes in marketing meth- 

 ods and we might as well prepare for 

 them. Only a few years ago livestock 

 producers were working through a 

 centralized selling system which had 

 already made possible tremendous 

 strides in the development of co-oper- 

 ative sales agencies which were effec- 

 tively and economically representing 

 the livestock producer in the sale of his 

 live animals. Recent years have seen 

 trends in the opposite direction, that is 

 toward decentralized selling. At the 

 same time meat packers, particularly 

 the larger ones, have been further cen- 

 tralizing their buying through the pur- 

 chase of additional plants and the ex- 

 pansion of operations as supplies of 

 livestock have permitted. 



Useless Machinery 



Livestock farmers should expect at 

 least three major benefits from coop- 

 erative marketing, namely (1) better 

 prices, (2) improved service, and (3) 

 stable or lower costs. The decentral- 

 ization of livestock marketing inter- 

 feres with or reduces these benefits. 



Farmers cannot hope to have a voice 

 in determining or even affecting price 

 levels if they persist in maintaining a 



great deal of useless marketing ma- 

 chinery in the form of unnecessary 

 stockyards and an excessive number of 

 commission agencies. 



Little improvement in service can be 

 promised so long as livestock is handled 

 by individuals or agencies who are in- 

 terested largely in the consumer view- 

 point or in the margin they take. 



Want Cheaper Food 



The consumer is interested in getting 

 cheaper food. And quite naturally those 

 engaged in the distribution and mar- 

 keting of livestock and its products are 

 more interested in maintaining their 

 share of the consumer's dollar than 

 they are in increasing the proportion 

 the farmer gets. Why should we expect 

 anything different? The same principle 

 applies to marketing costs. Figuring 

 average marketing expenses on Illi- 

 nois livestock at 40c per hundred, 

 transportation, feed, yardage, and com- 

 mission costs over $7,000,000 annually. 

 The way to increase returns, improve 

 service and reduce costs is to concen- 

 trate volume in the hands of fewer 

 sales agencies! 



According to a study made under the 

 auspices of the American Institute of 

 Meat Packers and of the University of 

 Chicago over a period of ten years 



I. A. A. RECORD 



