6 BULLETIN" 277_, L T . S. DEPARTMENT OF AGRICULTURE. 



Notwithstanding all of the objectionable features of the storage 

 business as now conducted, the farmer frequently considers it neces- 

 sary or to his advantage to hold his cotton. The past year has been 

 most strenuous for the cotton farmer; one of the largest crops ever 

 produced in the United States, the growth of 1914, has left his hands. 

 However, the world's visible suppty, at the opening of the new 

 cotton year, August 1, was in round figures about If million bales 

 larger than a year earlier. That means a large proportion of the 

 world's cotton crop of 1914 growth was carried over and added to 

 this season's crop. However, the exports of cotton from this coun- 

 try during the cotton year closed August 1, 1915, were very close to 

 those of the year ended August 1, 1914. This year's crop, at the 

 time of this bulletin's going to press, is still in the making. But 

 when it is considered that in normal years there is a loss of from 

 $30,000,000 to $75,000,000 from what is generally, although incor- 

 rectly, called "country damage," it will be seen that there is ample 

 need of an adequate warehousing system, regardless of whether the 

 crop is larger or smaller than normal. 



In connection with the value of a negotiable warehouse receipt, it 

 should be said that proper State laws covering the issuance of the 

 receipts are necessary. In order to be of greatest value the ware- 

 house receipts should show beyond question the ownership of the 

 product stored, and this accuracy can not be accomplished unless 

 the States in which the warehouse companies operate have laws that 

 properly guard the issuance of receipts. If the laws of the State in 

 which the Avarehouse is located are such as to throw any cloud upon 

 the title of the goods covered by the receipt, the receipt immediately 

 becomes almost worthless as collateral and defeats any effort to 

 borrow money at cheap rates from outside sources. In addition to 

 enacting such laws as will guarantee effectively the integrity of ware- 

 house receipts, it seems advisable for all States to adopt a law of 

 uniform warehouse receipts. This law is now in effect in many of the 

 States, and has been approved by the American Warehousemen's 

 Association, the American Bankers' Association, and the American 

 Bar Association as being the best form in which laws can be made to 

 protect both the owner of the goods and the lender of money against 

 the receipts covering such goods. 



The investigations previously referred to showed that there has 

 been great loss in the construction of the present warehouses. The 

 data gathered seemed to prove that the average insurance rate on 

 cotton in the buildings now in use is no1 less than $2 per annum 

 on $100. It is also true that if the money that has been spent on 

 these buildings had been expended economically and intelligently 

 in the construction of standard warehouses, properly protected with 

 automatic sprinkler equipment, the rate of insurance could be 



