FARM AND TERMINAL, MARKET PRICES. 3 



A considerable part of the grain which is purchased in less than 

 car-lot quantities is bought without any grade being specified. In a 

 majority of cases the elevators are not equipped to handle, separately 

 all the different grades grown in the territory. Usually, local quo- 

 tations are made to cover any grain of merchantable quality that 

 may be offered and are based upon the prevailing prices quoted for 

 the grade of grain which the mixed lots will make. 



Freight rates enter largely as a factor in determining the local 

 market price; whether long or short haul rates apply should be con- 

 sidered in the study of prices paid at local points. An estimated 

 average freight rate of 14.1 cents per 100 pounds, or 8.5 cents per 

 bushel, would be required to move to Chicago the whole crop of 

 wheat produced in Illinois and Indiana within a radius of 200 miles of 

 that market. To compute this average, the production of each county 

 within the 200-mile radius was used as the weight, the local freight 

 rate from a central shipping point in each county as the value; the 

 number of bushels produced in the county was multiplied by the 

 local rate for that county, the production and the extensions for all 

 the counties involved were added, and the total of the extensions was 

 divided by the total production. 



An approximate average freight rate of 17.3 cents per bushel for 

 wheat can be considered in reviewing the farm and terminal prices 

 for the Minneapolis market. Practically the same rate per 100 pounds 

 applies to corn and oats as to wheat. The following freight rates for 

 wheat were in effect: 



September 20, 1921 : Cents per bushel. 



Billings, Mont. , to Minneapolis, Minn 27. 3 



Aberdeen, S. Dak., to Minneapolis, Minn 14. 7 



Frederick, Kans. , to Kansas City, Mo 12. 9 



Columbia, Mo., to St. Louis, Mo 11. 4 



November 11, 1921: 



Minneapolis, Minn., to New York, N. Y., exports 22. 5 



Minneapolis, Minn., to New York, N. Y., domestic 25. 8 



Kansas City, Mo., to Galveston, Tex., exports 27.0 



Kansas City, Mo., to Galveston, Tex., domestic 30. 



Chicago, 111. , to Boston, Mass., exportfe 13. 5 



Chicago, 111., to Boston, Mass., domestic 19. 2 



GRAIN-MARKETING CHART. 



The accompanying chart (fig. 1) illustrates several price-determin- 

 ing factors in produce marketing. A terminal market is the only 

 outlet that can be depended upon at all times to absorb a surplus 

 production. For this reason all comparisons are made on the basis 

 of what the article would net if the terminal were used as the outlet. 

 The numbers used on the chart should be considered only as examples. 

 A separate study should be made of each area. 



