May, 1932 



THE LA. A. RECORD 



' Page Thirteen 



Grain 



Marketing" 



By Harrison Fabrnkopf 



STOCKHOLDERS and boards of 

 directors of farmers* elevators 

 should know that their co-operatives 

 can now become members of the Illinois 

 Grain Corporation without any cost. 

 In other words, the farmer, through 

 his elevator, has an opportunity of 

 building a strong terminal grain mar- 

 keting agency without the necessity of 

 advancing cash for the purpose. 



When an elevator board of directors 

 earnestly looks into the matter, it 

 eventually becomes a member of the 

 Illinois Grain Corporation, Some of 

 the members have even visited other 

 member elevators and perhaps made 

 trips to the terminal markets to meet 

 the personnel of the Illinois Grain Cor- 

 poration and of the Farmers National 

 Grain Corporation and to study the or- 

 ganizations at close range. 



If your elevator is a member, you 

 should keep yourself informed that your 

 faith in the organization will not only 

 be sustained but strengthened. If your 

 elevator is not a member, you as a di- 

 rector are seeking information that will 

 help you determine whether or not your 

 position is in the best interests of your 

 co-operative. 



Illinois Grain Corporation has been 

 in operation for more than a year, and 

 during what might be termed an or- 

 ganization period of twelve months, 

 succeeded in originating for market 

 nine million bushels of grain. If your 

 elevator is one of those not supporting 

 it with a membership, just what is the 

 reason? 



"The keynote to future prosperity is 

 improvement in distribution methods. 

 Distributors must cut costs and pass 

 along to the consumers the saving al- 

 ready achieved in production. Progress 

 in production has far outstripped prog- 

 ress in distribution. Our distribution 

 system because of its high cost, is still 

 the bottle neck which prevents the free 

 flow of mass production which gets to 

 the consumers. This business must at- 

 tract that great potential market among 

 the lower income classes to provide an 

 adequate outlet for its huge producing 

 capacity and to do this it must reduce 

 costs. Authorities estimate that the 

 avoidable waste in distribution is be- 

 tween $8,000,000,000 and $10,000,- 

 000,000 a year." 



After all, success in farming is de- 

 termined by a number of factors of 

 which marketing is one. If in local 

 co-operative marketing it is a good 

 thing for individuals to join together, 

 then in going beyond the local unit it 

 should be a profitable thing for co- 

 operatives themselves to join hands. 



Charge Trade Board 



With Discrimination 



Without attempting to enumerate a 

 number of individual reasons, doesn't 

 it cover it pretty well to say: "Our 

 board has just not got around to the 

 place where they felt it was the thing 

 to do?" Further enlightenment on the 

 question will probably reveal that the 

 directors talked it over several months 

 ago and JaTave not again given it fur- 

 ther serious consideration. 



The Illinois Grain Corporation is an 

 effort on the part of the farmer him- 

 self to render more efficient his system 

 of marketing. Certainly no industry 

 should be criticized for endeavoring to 

 conduct its business more efficiently. 

 Roger W. Babson, the well known 

 financial adviser and business forecaster, 

 said recently: 



Uncle Ab says, no matter what eco- 

 nomists may tell you, supply always 

 equals demand. 



PROPHECY DIDN'T COME 

 TRUE 



A PROPHECY made 30 years ago 

 was scheduled to mature this 

 year, but all signs indicate that the 

 prophecy just won't come true. 



At the turn of the century Sir Wil- 

 liam Crookes. eminent British scien- 

 tist, predicted that imless yields per 

 acre were increased, the world would 

 have a shortage of wheat by 1931, 

 even if all the potentially available 

 wheat land were put in use. 



Sir William noticed that wheat 

 production in the United States had 

 increased rapidly after the Civil War. 

 Finally the expansion halted, and ex- 

 ports began to decline. Prices stopped 

 falling, and began to rise. The 

 world's wheat area, Sir William 

 thought, could be increased by only 

 about 100 million acres. 



If Sir William were alive today he 

 would see his prophecy Ijnng in 

 ruins. It has been battered, Doctor 

 Stine of the Bureau of Ag^cultural 

 Economics points out, by the contri- 

 butions of science to wheat produc- 

 tion, by the introduction of power 

 machinery, and by the utilization of 

 lands hitherto thought useful only 

 for g^razing. 



Thirty years ago the average wheat 

 yield of the world, so far as statis- 

 tics are available, was 12.7 bushels 

 per acre. In the last seven years it 

 has averaged 14.1 bushels per acre, 

 an increase of 1.4 bushels. On last 

 year's wheat area, outside of Russia, 

 this increased yield on 320 million 

 acres makes a difference of nearly 

 half a billion bushels, or approxi- 

 mately 13 per cent of the world's 

 total production. 



Refusal of Membership on Chicago 



Market in Disregard of Law^ 



Alleged in Complaint Filed 



A charge of discrimination by the 

 Chicago Board of Trade against the 

 Farmers National Grain Corporation, 

 which, if sustained, places the grain ex- . 

 change liable to a Federal order closing 

 it under the Grain Futures Act, has 

 been filed by the corporation with the 

 commission of three cabinet members 

 created by the act to hear such dis- 

 putes, according to information made 

 available April 15 at the Department 

 of Agriculture and the Federal Farm 

 Board. 



The Board of Trade, it was explained, 

 refused membership in the clearing 

 house of the grain exchange to the 

 Farmers National Grain Corporation on 

 the ground that the corporation was 

 not qualified. Rules of the exchange 

 prohibit membership of corporations in 

 the clearing house, it was stated, al- 

 though the Grain Futures Act provides 

 specifically that co-operative marketing 

 associations shall be entitled to member- 

 ship on the Board of Trade "and all 

 privileges on" the Board, on terms re- 

 quired of other members. The follow- 

 ing additional information was pro- 

 vided: 



The Farmers National formerly em- 

 ployed the Updike Grain Co. to handle 

 its clearing house transactions, but some 

 months ago it decided to eliminate the 

 commission charges involved in this 

 procedure by acquiring the Updike 

 company. Since the acquisition the 

 Farmers National has done its clearing 

 through its subsidiaries. 



Recently the Board of Trade decided 

 to investigate the status of the Updike 

 company, now a subsidiary of a cor- 

 poration, the Farmers National. The 

 Farmers National then applied for 

 membership for itself on the clearing 

 house. Its application was rejected. 



The Farmers National now has asked 

 a hearing on this rejection, to be held 

 before the commission composed of the 

 Secretary of Agriculture, the Secretary 

 of Commerce, and the Attorney Gen- 

 eral of the United States, as provided 

 in the Grain Futures Act. 



The Grain Futures Act authorizes 

 the Secretary of Agriculture to desig- 

 nate any board of trade as a contract 

 market under certain conditions, and 

 only these contract markets may deal 

 in futures. One of the conditions spe- 

 cified by the act is as follows: 



"When the governing board thereof 

 does not exclude from membership in, 

 and all privileges on, such board of 

 (Continued on page 14 col. 1) 



