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10 





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I. A. A. Record — April. 1934 



Pure Milk Ass'n. Holds 



Ninth Annual Meeting 



• .'..■-^v. 





No Action Taken on Establish - 

 t ment of Surplus Plants 



f i . 



BON 6EYES 



A crowd estimated at more than 2,- 

 000 attended the ninth annual meeting 

 of Pure Milk Association in the Audi- 

 torium Theatre, Chicago, March 13. A 

 proposal submitted by the board of 

 directors recommending the establish- 

 ment of farmer-owned surplus plants 

 was cansidered but no definite action 

 was taken. It was 

 finally agreed to 

 postpone action 

 until more infor- 

 mation could be 

 given the mem- 

 bership. 



This plan, un- 

 der which all sur- 

 plus milk would 

 be processed into 

 condensed milk, 

 :heese, butter, etc. 

 is working out ' . ■ 



satisfactorily at Peoria, Quincy, and 

 other Illinois markets. . 



"When the membership of the Pure 

 Milk Association fully understands 

 this plan I believe they will support 

 it," said J. B. Countiss, director of 

 dairy marketing for the I. A. A. "The 

 producers can get higher net returns 

 by processing their own surplus milk 

 in their own plants than by sale 

 through other means." . ' / , , 

 : ; vProiuction Down 

 The reports of officers showed that 

 the Association marketed 1,120,316,242 

 pounds of basic milk and 208,528,352 

 pounds of surplus milk or a total of 

 1,369,692,650 pounds last year. . 



"This is approximately 7,000,000 

 pounds less production than the year 

 before," said Manager Don Geyer, 

 "and is the direct answer to critics of 

 fluid milk organizations who attempt 

 to place the responsibility for surplus 

 upon fluid milk producers." Mr. Geyer 

 stated that the breakdown in retail 

 prices with narrowing of dealers' 

 spreads had resulted in collection 

 problems, with dealers' outstanding 

 bills for milk the largest in the his- 

 tory of the organization. 



Through the adjustment fund ob- 

 tained by a five cent per 100 lb. check- 

 off on all members' milk, a market 

 was provided for members who had no 

 regular outlet. The adjustment fund, 

 according to L. D. Granger in charge 

 <>f-,this work, furnished a market 

 monthly to 2,365 members. It sold 

 nearly 70,000,000 pounds of basic milk 

 for members who had no fluid mar- 

 ket, and made up the difference in 



price by paying nearly 30,000 claims 

 totaling approximately $450,000. 



President Henry Pfister stated that 

 within the central office there is a 

 spirit of co-operation shown by the 75 

 employees "that makes possible the 

 carrying out of the Association's pol- 

 icies in as efficient and complete a 

 manner as possible. 



During the year the gross income of 

 the Association was $423,862.49, ex- 

 penses were $383,089.72, leaving a net 

 income to surplus of $40,772.77. The 

 net worth of the Association as of De- 

 cember 31, 1933 is $246,843.33. The 

 audit was made by the Illinois Agri- 

 cultural Auditing Association. 



Speakers include Fred Sexauer, 

 president of the New York Dairy- 

 men's League; Frank Baker, AAA 

 market administrator for Chicago; and 

 others. Women attending were enter- 

 tained at a luncheon in the Congress 



Hotel, ■•.■^^•^.•.■■>••vv:•.>••^.■: ■.<.-■..:,■ 



New directors elected to the board 

 include E. E. Houghtby of DeKalb 

 county, and Frank Green of McHenry 

 county. There were no changes in the 

 officers. The Association contributed 

 a little more than $80,000 of its in- 

 come during the year to the advertis- 

 ing fund spent under the direction of 

 the Milk Foundation. : ; ; \ ; 



New Rate On Soybeans 



Helps Illinois Growers 



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A new freight rate on soybeans 

 from Illinois to the eastern seaboard 

 which is eight cents lower than the 

 old rate was secured recently by the 

 transportation division of the Illinois 

 Agricultural Association. The new 

 rate which became effective March 10 

 .promises to have the effect of raising 

 the price at least eight cents per 

 bushel on a substantial part of-.the"'^ 

 commercial crop grown in Illinois. Ap- 

 plied to 2,000,000 bushels of beans it 

 would mean a saving of at least $160,- 

 000 to Illinois growers. 



The new rate on soybeans, accord- 

 ing to G. W. Baxter of the I. A. A., 

 who negotiated the reduction through 

 the Central Freight Association, is the 

 same as the rate on grain, namely, 

 23.7 cents per bushel. Illinois proces- 

 sors still have an advantage of ap- 

 proximately 17 cents per bushel on 

 freight since the average rate from 

 Illinois shipping points to processors' 

 plants within the state is about seven 

 cents per bushel. 



The lower rate was opposed by the 

 traffic department of one large pro- 

 cessor at Decatur apparently because 

 he feared that competition from east- 

 em buyers would raise the price re- 

 ceived by the Illinois farmer. 



Quad Cities Market 



A- .^?X^ AAA 



(Continued from page 9) ■ :- - • 



a 10 cent per quart market, for ex- 

 ample, certain dealers were paying 

 producers less than $1 per cwt. net for 

 milk. Net return tickets conclusively 

 proving this statement were intro- 

 duced into the records at the hearing 

 by President F. H. Schafer of Quality 

 Milk Ass'n. 



Before the organized producers will 

 revert to that kind of a situation, they 

 prefer to go into the distributing busi- 

 ness themselves and if necessary set 

 up milk depots throughout the Quad 

 Cities until routes can be established. 

 Even with a 50 per cent surplus and ' 

 a 6c retail price. Quality Milk As- 

 sociation members have been getting 

 from 85c to 95c per cwt. for milk 

 which is little worse than the deal 

 some distributors were handing out 

 when milk retailed for 10 cents. 



There is a very simple way out of 

 a bad situation at the Quad Cities. 

 That is to establish an 8 or 9c price . 

 to the consumer, allow the dealer a 

 fair margin for his services but not an 

 exorbitant profit as was the case 

 several years ago, and pay the balance 

 according to a pool plan to the milk 

 producers, as set forth in the proposed : 

 agreement. .••■■;•■/.:• •■■•/:■.•:::■ :.:^^;.. ■'-,.;-. 



V Later a base and surplus plan can 

 be put into effect by the federal ad-- 

 ministrator so as to adjust preductioh 

 more nearly to demand. . , v ?i 



Under the proposed plan, farmers 

 who retail their own milk up to 250 

 lbs. per day would not be included in 

 the pool. Sentiment was expressed 

 both for increasing and lowering this 

 arbitrary figure. r ^ -4 - > - 



^^' •^' ;-:•:. t '••'■•■ Cost of Sales ''\i.':.^'"<^^'■'■'^'.■ 

 The lowana Dairy testified that its 

 present sales cost is 2.8c per qt., proc- 

 essing cost 1.84c, and the cost of milk 

 at 95c per cwt. for 3.5% milk is 2.3c 

 or a total cost of 6.9c per qt. Milk is 

 sold to stores at 5c and delivered to 

 the housewife at 6c per qt. These 

 sales and processing costs are thought 

 to be higher than average because 

 they are figured on a relatively small 

 volume. On the present basis the 

 larger dealers, it is generally con- 

 ceded, are not making a fair profit 

 although most of them seem to be 

 paying expenses and living. 



Under the schedule of unfair trade 

 practices, the minimum prices to be 

 charged the consumer would be 7c 

 per qt. for milk containing 3.9% but- 

 terfat or less, 8c for 4% milk, 22c per 

 qt. for 22% or less cream, 29e per qt. 

 for 23-30% cream, etc. 



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