COOPERATIVE GRAIN MARKETING. 13 



vators located either at Port Arthur or Fort William, Ontario, from 

 which grain may move eastward by rail or boat across the Great 

 Lakes. By public terminal elevators is meant terminal elevators 

 which have qualified as such under the Canada Grain Act and are 

 duly licensed to conduct a public storage business under the rules and 

 regulations prescribed by the Board of Grain Commissioners for 

 Canada. 



A distinction should be noted here between public terminal ele- 

 vators and private terminal elevators. The former are not allowed 

 to mix grades nor to own any of the grain held in their custody as 

 public warehousemen. Their business is to clean and store grain 

 under such conditions and for such charges as the Board of Grain 

 Commissioners for Canada may approve. They are subject to very 

 close Government supervision, and warehouse receipts issued by 

 them are deliverable on future contracts. The private or " hospital " 3 

 elevators, while also under Government supervision, , are allowed to 

 mix certain grades, but are not allowed to conduct a public-storage 

 business. They must buy all of the grain which they handle. They, 

 of course, are able to earn a considerable amount at times through 

 their mixing operations. For example, when low-grade grain is be- 

 ing sold at heavy discounts they may buy a quantity of very high 

 quality No. 2 Hard wheat, mix into it a quantity of low-grade wheat 

 and still retain No. 2 grade. It may be noted that hospital elevators 

 are prohibited from taking certain grades into their elevators and 

 also that when it appears that grain shipped from any private ele- 

 vator is being systematically reduced in quality below the general 

 average quality of the grain of similar grades in the bins of the 

 public terminal elevators, such grain may be required to pass inspec- 

 tion at a lower designated grade. It will be seen therefore, that 

 while the manufacturing of grades by mixing constitutes a consider- 

 able part of the business of private elevators, even these operations 

 are not without limitation. 



The benefits which may be secured to the farmers' companies from 

 the operation of hospital elevators are evident. These elevators en- 

 able them to condition their own grain and to take advantage of any 

 profits to be made through mixing operations. In the operation of 

 their public terminal elevators, however, the source of profit is some- 

 what obscured by the fact that under the law they may not store any 

 grain for themselves, but must depend for their profits upon storage 

 patronage secured from others. 



The methods by which grain is sold on the Winnipeg Grain Ex- 

 change is of interest in this connection. While sample markets have 



3 The Canada Grain Act defines a hospital elevator to include every elevator or ware- 

 house which is used for cleaning or other special treatment of rejected grain which is 

 equipped with special machinery for that purpose. 



