373] THE BUTTER MARKET I49 



geles were still receiving butter on the commission basis, 

 while dealers in eastern and middle western markets, in 

 1896, 1 were already generally receiving butter on the " con- 

 tract " basis, which is an agreement between the producer 

 and dealer to use the quotations of some exchange as a 

 basis for trading. While five per cent was the usual charge 

 by commission men everywhere at the time this method 

 was principally used, it was probably a very common prac- 

 tice among them to make deductions on account of loss in 

 weight, or storage, etc., and by such extra charges raise 

 their income considerably above five per cent. Of course 

 it must not be forgotten that a good deal of the butter made 

 at that time was of a poor quality, and that the dealer in 

 such instances was in no way to blame for the small returns 

 made to the producer. 



The organization of the Elgin Board of Trade may be 

 regarded as a protest against this kind of dealing and as a 

 means of protecting the producer. What its founders spe- 

 cifically wanted was to make the dealers buy on the manu- 

 facturers' terms. They wanted the dealer to come to the 

 producer to make the purchase, and pay for the butter 

 f. o. b. shipping place. Doubtless the action taken by the 

 producers in the Elgin district served to stimulate the whole- 

 sale dealers to greater activity in organizing the butter 

 markets. So that it may be said that the development of 

 these organized markets, both the producers' and middle- 

 men's markets, was due in large measure to the fight that 

 was waged by the producers against the commission men. 



The great need that the butter trade felt in the 70's was 

 for an accurate trading basis, or correct market prices for 

 the various qualities. From a broad economic point of view 

 this was a force inherent in the trade that would sooner 



1 Report of the Elgin Board of Trade for ign. 



