Tart II.] COST OF MILK PRODUCTION. 55 



the price of wheat has been fixed, which is intended to protect 

 all parties concerned, especially the consumer. Under this ar- 

 rangement farmers are not able to receive the price which they 

 would otherwise get for their wheat. At the present moment 

 the price of corn is so high, and consequently the price of pork, 

 which is largely dependent upon it, that some farmers are prac- 

 tically forced to feed wheat to hogs rather than sell it at the 

 price fixed by the Food Administration; therefore this wheat, 

 instead of being sent to our Allies, where it should go, is being 

 consumed at home in other forms than flour. This is merely 

 one illustration of the result of a price-fixing program. Of 

 course this is only temporary, and will be adjusted in a few 

 weeks when new corn is more abundant. 



What has all this to do with the cost of producing milk? It 

 has a great deal to do with it. In the first place, the making of 

 milk is in reality a manufacturing process. We ordinarily speak 

 of dairymen as producers, but as a matter of fact they are 

 middlemen, or, perhaps more correctly called, manufacturers. I 

 have attempted to illustrate by means of a diagram which is 

 intended to show graphically that dairymen ordinarily purchase 

 raw material in the form of concentrated feedstuffs, fertilizers, 

 farm machinery, seed and the like, and convert this, in one way 

 or ajnother, through the medium of their machinery, that is, the 

 dairy cow, into a relatively finished product, — raw milk. In 

 practice this raw milk is usually sold to large dealers who in 

 turn continue this manufacturing process by pasteurizing, 

 bottling and delivering the milk to the public. Therefore the 

 farmer is dependent primarily upon the prices of raw materials, 

 which he usually buys. As a result, if the price-fixing program 

 or the law of supply and demand or any exigencies force the 

 supply of raw material or labor to unusually high levels the 

 price of milk must be correspondingly increased. 



How are farmers as manufacturers going to know what price 

 to place upon their manufactured products if they do not have 

 information concerning the cost of the raw material and the 

 different expenses entering into the conversion of that raw 

 material into a finished product? 



These war times are necessitating every industry to have 

 more accurate information in regard to the costs of running its 



