18 



MASS. EXPERIMENT STATION BULLETIN 363 



Extreme variation of two types was present. The first and least important 

 was the variation among routes. The second and highly significant was the 

 marked difference between December and May costs on particular routes. Group 

 I (Table 11), composed of three carriers serving slightly over half of the producers 

 and carting over half the total volume of milk, had an unfavorable December- 

 May income ratio of 61. Group II, consisting of the remaining carriers, handled 

 somewhat less milk in May and slightly more in December than Group I. The 

 income of Group II was higher than that of Group I in both months, and the 

 December-May income ratio of Group II was 76.5. 



The group of carriers having the least variation in size of load was for the most 

 part charging higher rates for providing the service than the carriers operating 

 under less favorable conditions. The sole explanation for this apparent anomaly 

 probably lies in the volume per load. Some of the loads in Group II were rela- 

 tively small and although thej' represented high unit costs to the producer, they 

 probably did not provide much in the way of income to the carrier. 



T.\BLE 11. — Seasonal Variation in Income and Load of Most Variable 

 AND Least Variable Groups 

 May and December, 1935 



Trucking Income 



May dollars 



December dollars 



December- May ratio percent 



Volume 



May pounds 



December pounds 



December- May ratio percent 



Income 



May 



December 



Volume 



May 



December 



Number of Producers 



May 



December 



Percent of Total 

 49.3 50.6 



43.7 56.2 



54.7 

 48.9 



53.0 

 54.4 



47.0 



45.5 



The importance of cartage rates in a milk marketing system characterized by 

 artificial prices varies with the conditions prevailing in particular markets at 

 particular times. When total market supplies tend to be generally heavier than 

 demand, a discriminatory rate structure among carriers enables the dealer charg- 

 ing the higher cartage rate to use the differential in gaining a more preferential 

 price position than he could otherwise attain. Conversely, when the total market 

 supplies tend to closely approximate demand over a period of time, the dealer 

 attempting to use a higher cartage rate than his competitors is at a disadvantage 

 in the derivation of his supply because his prices to producers are proportionately 



