12 BULLETIN 682, U. S. DEPARTMENT OF AGRICULTURE. 
parison of actual market values of exactly the same grades of butter; 
but either actual or potential competition between numerous cream- 
eries producing in excess of local market demands has tended to 
establish a fundamental level of prices between such market centers. 
The retail prices in some of the cities of the country, however, may 
sometimes be out of line with the basic prices of the larger butter- 
distributing centers: First, because definite and dependable market 
reports on creamery butter are not available for many cities in dif- 
ferent parts of the country; and, second, because country creameries 
generally have no direct trade connections in such cities. Most coun- 
try creameries can choose only between such large wholesale dis- 
tributing centers as New York, Philadelphia, Chicago, and San 
Francisco. There are not many wholesale butter merchants in any 
other American cities who have won the patronage of a large num- 
ber of creameries, and consequently there is little direct competition 
between different creameries for market outlets in a large number of 
different cities. This lack of direct competition between a large num- 
ber of different creameries for various market outlets in various cities 
has enabled certain large centralizer creameries, which maintain 
their own distributing organizations in cities lke Denver, Colo., 
Omaha, Nebr., Sioux City, Iowa, St. Paul and Duluth, Minn., De- 
troit, Mich., Milwaukee, Wis., and Columbus, Ohio, to sell at prices 
which temporarily may be higher than those received by some local 
country creameries. 
Figure 3 compares the prevailing average retail prices of creamery 
butter in some of the larger cities of the United States. These prices 
are based on the reports of representative retail grocers which are 
made monthly to the Bureau of Labor Statistics, United States 
Department of Labor. Although there are differences in prices re- 
ported by different retailers within the same city, the average yearly 
prices show that, on the whole, consumers generally pay higher prices 
for butter in some cities than in others. 
The variations in the margins between the lines which show the 
retail prices in the various cities and the line which shows the basic 
Chicago wholesale quotation, represent roughly the differences in 
transportation costs from various sources of supply. The combined 
costs and profits of both the wholesale and retail distribution within 
a city, are indicated by the margin of difference between the whole- 
sale price quotations of Chicago and the average of the prevailing 
retail prices in that city. 
COMPETITION BETWEEN COUNTRY CREAMERIES AND CENTRALIZERS. 
As a rule the wholesale prices of centralizer creameries are in 
line with the Chicago quotations, except for occasional increases 
1 Bulletin 84 of the U. S. Bureau of Labor Statistics, entitled ‘‘ Retail Prices of Food, 
1915-1916.” 
