COOPERATIVES: EARLY PHASES 83 



to market could be avoided by not overfeeding their stock; they observed 

 that better animals brought better prices, hence saw new value in scientific 

 breeding; they got better treatment in the central market because of the 

 larger volume handled; and finally, they enhanced the prosperity and 

 the reputations of their local communities. 55 



The formation of local shipping associations in large numbers led 

 naturally to the establishment of terminal livestock-marketing associa- 

 tions. And essentially the same reasons that induced the farmers to create 

 local livestock cooperatives drew them into the terminal field. Here high 

 commission rates, unfair discrimination in the services rendered, and the 

 variety of prices paid spurred the livestock producers to compete with 

 private firms. 



The earliest farmer attempts to set up cooperative terminal agencies 

 were by no means successful. One of the first such efforts was the Amer- 

 ican Live Stock Commission Company, organized in 1889. The share- 

 holders in this company were the Farmers' Alliances of Kansas, Nebraska, 

 and Missouri and the Kansas state Grange. Beginning operations in May, 

 1889, it soon had commission firms operating on the Chicago, Kansas 

 City, St. Louis, and Omaha markets. With a paid-up capital of $25,000, 

 by November 30, 1889, the company had some $40,494 in profits to divide 

 among its stockholders. For the year which ended December i, 1890, it 

 collected more than $101,000 in commissions at the four markets and sold 

 more than $2,500,000 worth of livestock. At first the Chicago manager 

 was able to obtain a membership on the Chicago livestock exchange but 

 this was soon lost, and without it the company was unable to operate in 

 that center. The closing of the Chicago market was disastrous to the 

 whole organization, and soon the other markets were also abandoned. 56 



Typical of other early failures was the Co-operative Live Stock Com- 

 mission Company, organized under the laws of Colorado with a capital 

 stock of $100,000. This company began business at Chicago and Kansas 

 City on September i, 1907, but speedily aroused the anger of the private 

 firms by displaying a profit. The discriminations which followed led to 



55. Hibbard, Foster, and Davis, in Wisconsin Bulletin 314, pp. 7-9. 



56. C. G. Randall, Cooperative Marketing of Livestoc^ in the United States by 

 Terminal Associations, U. S. Dept. Agri., Technical Bulletin 57 (Washington, 1928), 

 pp. 6-7. 



