43 



bank is reduced year by year. As a rule the principal is paid off at a rate to clear the whole 

 debt in twenty to thirty years. The following is a usual form of guarantee: 



We the undersigned hereby pledge ourselves to deliver to the Co-operative Bacon Factory which 

 it is proposed to establish, all the pigs of weights between 150 and 200 Ibs. which we may produce for 

 sale. Such pigs will be delivered on conditions decided by the shareholders of the Society, and that 

 we shall receive such amount in payment of such delivered swine as may be realized for them by the 

 factory less preliminary expenses incurred in the organization of the Society and the annual instal- 

 ments on loan for building and plant payable during a period of about 25 years together with current 

 working expenses. 



The guarantee is graduated according to the number of acres owned by each member 

 respectively. Ownership of 25 acres or less is sufficient for a guarantee of about $14; be- 

 tween 25 and 250 acres, $28; and for larger amounts $28 for each 250 acres. The guarantee 

 of one member in no case exceeds $135. It is a fundamental principle that each guarantor 

 is a partner in the ownership of the whole property of the factory in proportion to the amount 

 of his respective guarantee. The penalty for violation of the agreement to deliver all market- 

 able pigs to the co-operative factory is $2.70 per pig sold to any other concern or person. 

 The further penalty of expulsion from the Association may also be exacted. 



Shareholders who live within 6 miles of the factory as a rule deliver their pigs free, but 

 those living at a greater distance deliver to the nearest railway station, and the association 

 pays the freight from there to the factory. In some associations a bonus of about 7 cents 

 per hog is granted the shareholders who deliver their own pigs. The packing plant agrees 

 to accept every sound hog delivered. The pigs when delivered are unloaded into a small 

 car and a metal tag is put into the ear of each for identification. If the owner so desires 

 the pigs may be weighed alive. Immediately after being dressed they are weighed and 

 classified. An advance covering a portion of the value, based on the current quotations 

 and the class to which the carcass belongs, is made at once. About one-quarter of a cent 

 per pound is withheld until the end of the year, when the final premium is paid on the basis 

 of weight of pork delivered during the year. 



FIXING THE PRICE. 



In each province or district there is a committee to fix the prices for the factories in that 

 province or district. Quotations are fixed on Saturday morning for the following week. 

 The committee charged with this learns the views of the several committees attached to 

 individual co-operative factories, and sets the price according to the average of the recom- 

 medations of the several local committees. That is to say, if five committees recommend 

 45 ore per pound while five others place the figure at 46 ore per pound for grade No. 1, the 

 general committee sets it at 45J. To guard the interests of all concerned an arbitrator is 

 appointed to decide cases in dispute. 



A local committee to arrange quotations consists of three, the president, a well known 

 farmer who is not a director of the association, and the manager of a factory. The manager 

 lays before the others the latest telegrams and information in regard to the state of the British 

 bacon market and the results of the consignments shipped during the week. After providing 

 for a profit of $1 .25 to $1 . 75 per hog and a quarter of a cent for working expenses, the com- 

 mittee decides upon its quotation. It was pointed out to the Commission that it is not 

 always possible to allow for a profit per hog as large as stated above. At times of low values 

 and dropping prices current quotations are held up. This condition occurred during 4 or 5 

 months early in 1908, when quotations were maintained as high as possible to satisfy the 

 producers, and thus keep up the weekly supply. The return of good prices later enabled 

 the association to make their entire profits for the year during the last 6 or 7 months. Care 

 has always to be taken to see that the quotations during the year are on the safe side. It 

 is usually sufficiently low to allow of a final dividend of from three-quarters to one cent per 

 pound for all deliveries during the year. Considerable competition exists between co-oper- 

 ative associations as to which shall pay the highest final dividends. 



The Commission was advised that no steps are taken by the association to discourage 

 heavy deliveries during any particular season of the year, as, for instance, the fall when 

 other countries have heavy runs. The farmers have learned the wisdom of even distribu- 



