4 BULLETIN 1392, U. 8S. DEPARTMENT OF AGRICULTURE 
of middling cotton in New Orleans was 40.52 cents in June, 1920, 
and 14.64 cents in December. In March, 1921, it was 11. 08 cents. 
At some inland points middling cotton was offered at as low as 8 
cents per pound. Both the 1919 and 1920 crops had been grown 
at great expense, and as a result of this enormous price decline in 
1920 cotton producers faced disaster. 
There were other reasons, traceable in part at least to war in- 
fluences, that contributed to ‘the development of widespread dissat- 
isfaction with the established cotton- marketing system. In 1912 
the United States Department of Agriculture began some research 
work relative to cotton marketing, the results of which showed that | 
cotton was not sold on the basis of quality in most local markets. 
The disadvantage of selling on the average or “ hog-round ” price, 
which was being brought to the growers’ attention, was emphasized 
by the wide differences for orade and staple that prevailed in 1919 
and 1920, 
In the 10-year period beginning in 1914 the United States Depart- 
ment of Agriculture, the agricultural colleges in the Southern 
States, and ‘other agencies did much that helped to pave the way 
for organized marketing by producers. Not only did they make 
available results of fundamental research work, thereby enabling 
the farmer to realize his problem, but this work also influenced 
much valuable State and National legislation. 
In 1914, nine grades of upland white cotton were promulgated 
as official cotton standards of the United States under provisions 
of the cotton futures act. Standards for tinged and stained cotton 
were promulgated under the same act in 1916, and standards for 
grade and length of staple for sea-island and American Egyptian 
cotton in 1918. In accordance with an amendment to the act in 
1919 a cotton-quotation service was developed and weekly reports 
on spot prices and cotton-market conditions were made available. 
The United States cotton standards act of 1923 provided, among 
other things, that in transactions in interstate and foreign commerce 
in which cotton is described by grade and staple the description 
shall be in terms of the official cotton standards. 
The United States warehouse act of August 11, 1916, amended in 
1919 and 1923, provided for the licensing under certain conditions 
of warehousemen who store agricultural products moving in inter- 
state or foreign commerce. Many States also enacted warehouse 
legislation during the period. The War Finance Corporation was 
revived in January, 1921, as a special aid to agriculture. The agri- 
cultural credits act of 1923 provided for the establishment of 12 
Federal intermediate credit banks to supply production and market- 
ing credit. The Capper-Volstead Act, which became a law on 
F ebruary 18, 1922, exempted agricultural organizations from ne 
Sherman antitrust law. Since 1920, 37 States have enacted, 
W hole or in part, what is commonly called the “ standard maces 
act,” an act providing specifically ‘for the incorporation and opera- 
tion of farmers’ cooperative marketing associations. 
AMERICAN COTTON ASSOCIATION 
An important factor in the development of cooperative cotton 
marketing was the organization in May, 1919, of the American Cot- 
ton Association, a south- wide association of farmers, bankers, mer- 
