Voi.. LXXIV. No. 4309. 
NEW YORK, JUNE 5, 1915. 
WEEKLY $1.00 PER YEAR. 
Co-operation in Western Canada. 
Where Farmers Hang Together. 
I‘art I. 
W INNIPEG WHEAT.—A recent pamphlet from 
the University of Minnesota is entitled 
“Studies in the Marketing of Farm Pro¬ 
ducts.” This gives an interesting statement regard¬ 
ing the handling of live stock, potatoes, poultry, 
milk, and other articles in the State of Minnesota. 
There is also a discussion of the cooperative work 
of the grain growers in Western Canada by L. D. 
H. Weld. Up in that country some remarkable 
things have been done by associations of farmers. 
It is not generally known that Winnipeg is the 
greatest primary wheat market in the world. In the 
year 1913, 238,000,000 bushels of wheat were re¬ 
ceived in that city. Railroad lines from all over 
the wheat growing section run into it. In order to 
handle this great trade, the grain dealers organized 
the Winnipeg Grain Ex¬ 
change. As the grain 
trade of Western Can¬ 
ada developed, many of 
the abuses and difficul¬ 
ties which were found 
in the American North¬ 
west worked into the 
Canadian trade. Farm¬ 
ers and shippers found 
it difficult to get cars. 
Low prices were paid to 
the farmers at country 
points and there were 
frequent complaints of 
under - weighing a n d 
heavy dockage. These 
abuses grew until the 
farmers began to organ¬ 
ize and they finally suc¬ 
ceeded in forming three 
cooperative companies. 
BEGINNING TIIE 
M () V E M E N T .— 1 The 
movement first took the 
form of local grain 
dealers’ asociations, and 
these were finally 
brought together or fed¬ 
erated into large asso¬ 
ciations. The objects 
of these grain growers 
were and are both so¬ 
cial and legislative. 
First, they were formed 
to get together a n d 
learn how to hold to¬ 
gether when they were 
organized. They expect¬ 
ed through their organization to influence legisla¬ 
tion which would bring about improvement in mar¬ 
keting. grading, and the transportation of grain As 
a part of their work, they tried to promote better edu¬ 
cation among farmers, and to learn how to purchase 
supplies to better advantage, and also how to dis¬ 
tribute their own products in the most effective way. 
FORMING A GRAIN COMPANY.—The Grain 
Growers’ Grain Company seems to have had the 
greatest success as an organization. It was started 
with the idea of organizing a company which should 
obtain a seat on the Winnipeg Grain Exchange, and 
a °t i,s commission agent for consignments of grain. 
It started in 1905 with about 40 shareholders. It 
giew, and in 190G a seat in the Grain Exchange was 
purchased for $2,500, and a line of credit was se¬ 
cured by the joint signature of many farmers. Few 
things in connection with business agriculture are 
more interesting and startling than the growth of 
this organization since 1900. It started in debt; 
i! entered upon a business with leaders who had 
had no experience, and met in competition power¬ 
ful and organized interests that had been long es¬ 
tablished in the terminal market. Every business 
difficulty that can be imagined faced this young 
company, yet it soon began to prosper and within 
six years, had become the largest single handler of 
grain in the Winnipeg market. The great secret of 
its success seems to be the fact that its members 
hung loyally together in the face of discouragement 
ami defeat, and even put up extra money willingly 
in order to save the organization when it was 
threatened with ruin. 
TRADE OPPOSITION.—The Winnipeg Grain 
Exchange was naturally opposed to this organiza¬ 
tion. A month after the Grain Growers started 
growers face to face with a crisis. There was no 
market for wheat in or near Winnipeg, outside of 
the Exchange. The manager of the Grain Growers 
went East and succeeded in finding a market for 
considerable grain, but it was necessary for them 
at that time to belong to the Exchange. The Grain 
Growers appealed to the Manitoba Government 
asking it to compel the Grain Exchange to rein¬ 
state them. Their influence was so strong that the 
Government took their side, and held that they 
should not have been expelled. It even threatened 
to take away the charter of the Grain Exchange. 
The latter was willing to readmit the Grain Grow¬ 
ers on condition that it would abandon its intention 
of dividend profits on a patronage basis. This was 
finally agieed to, and the Grain (1 rowers were again 
admitted to the Exchange in April, 1907. 
DIVISION OF PROFITS.—As it turned out, this 
inability to divide the profits proved a blessing in 
disguise. If it bad carried out its original plan, tin* 
Grain Growers’ C’om- 
Horses that Talk and Express Their Gratitude. Fig. 291 
they issued a circular, and declared their'plan of 
paying wlmt was known as "a patronage dividend.’’ 
What they meant by that was. that they would pay 
a fair rate of dividend to stockholders, but would 
distribute surplus profits to grain shippers in pro¬ 
portion to the amount of grain shipped by each. 
The Winnipeg Exchange objected to this “patron¬ 
age dividend." They claimed that this was a re¬ 
bate to shippers and against their rules. The Grain 
Growers were expelled from membership, with the 
result that no member of the Exchange could pur¬ 
chase grain from the company without charging 
the usual commission. This of course would have 
left the grain company without any revenue, as it 
in turn depended on the commission charged farm¬ 
ers who consigned grain to it. This put the grain 
pany would probably 
have paid out all its 
profits as dividend with¬ 
out building up a sub¬ 
stantial reserve. At 
first these profits were 
generously divided. The 
first year there was a 
7% dividend, the sec¬ 
ond year 40%, the third 
30%, and so on. It is 
said that the original 
subscribers to the com¬ 
pany paid in cash only 
$7.50 for shares which 
are now worth $25. At 
the end of three years, 
the dividend had paid 
for these shares in full, 
and had it not. been for 
the Grain Growers’ 
Company, all of these 
dividends would have 
been taken from the 
farmers and given to 
the handlers. It is no 
wonder that, as we are 
told, the Grain Grow¬ 
ers realized this point, 
and many of them nev¬ 
er cashed in the 7% 
cash dividend checks of 
the first year, but have 
had them framed and 
keep hanging on their 
wall as they would a 
picture. In 1909 the 
policy of this company 
was changed; 15% dividends were declared in 1910. 
and 10% since that time. As a result of this, the 
company has built up a great reserve, and this has 
been used as a source of financial strength, for this 
money taken from its earnings has enabled the 
company to enter into various activities, such as 
providing coal, lumber and other supplies: buying 
fruit for its members and also in operating elevators 
and flour mills. A sketch of some of these develop¬ 
ments will be given next week in which we shall 
show how these farmers were able to succeed where 
other large organizations have melted or fallen 
apart. These men knew that they were obliged to 
hold together and therefore, in time of trouble or 
financial loss, they did not crumble or give way, but 
stood ready to give up more money, if it were no- 
