<Ibt RURAL. NEW-YORKER 
1815 
How Canadian Farmers Fought a MilkTrust 
They Got Up Close to the Consumer 
i 
f 
F ormer condition s.—The 
drain Growers’ Guide, a farm 
paper printed in Manitoba, tells how 
the dairymen who supply the city of 
Vancouver, B. C., organized and finally 
gained control of their own business. 
Six years ago the dairymen of the 
Fraser Valley were obliged to take just 
about what the middlemen saw fit to 
hand them. The dairy business, in¬ 
cluding butter, cheese and milk, was 
handled by dealers, who in turn han¬ 
dled the unorganized farmers even 
worse than was the case in New York 
before the Dairymen’s League gained 
its power through organization. Today 
the Milk Producers’ Association con¬ 
trols entirely the manufacture of cheese 
and butter, and also about 05 per cent 
of the retail milk trade. 
DISPLACING THE MIDDLEMAN. 
—“We have displaced the capital of 
the middlemen with our own capital.” 
is the way the leaders put it. It was 
not easy to get the dairymen to com¬ 
bine at first. As is always the case, 
farmers are cautious about getting into 
a new company which is to be financed 
and directed by their own people. It 
is usually much easier for some un¬ 
known promoter to go into a country 
■ neighborhood and get money on an in¬ 
dustrial proposition than for old-time 
residents whose character is well 
known to organize a co-operative busi¬ 
ness. The first attempts to organize 
these milk producers were not success¬ 
ful. Most of them were not ready— 
they did not quite realize how hard 
they were being pinched. Finally, in 
1917. conditions ripened so that the 
producers were ready for anything. 
The war conditions had steadily in¬ 
creased the cost of production while, 
as Spring came on. the distributors 
prepared to cut down the price of milk 
to producers. 
FIGURING PRICES.—In that coun¬ 
try the price of milk is figured on a 
butterfat basis, as the surplus milk decides the price, 
and that surplus is made into butter and cheese. 
The dealers gave notice that the price would be 55 
cents a pound for butterfat, which for 3.5 per cent 
milk would he $1.92% per 100 pounds, or less than 
four cents a quart. The producers at once began 
to organize. They were asked to sign contracts to 
ship their milk for one year through the association. 
It was a warm and successful campaign, and the 
association obtained control of enough milk to handle 
the situation. Armed with these contracts the 
directors of the association met the milk companies, 
and forced them to raise their price to G5 cents a 
pound of butterfat, or $2.27% per 100 pounds of 3.5 
per cent milk. This was a practical demonstration 
of what organization can do, and the producers 
rushed to join the association. 
CONTRACTS AND CAPITAL.—At first members 
were asked to sign contracts for one year and take 
stock on the basis of $50 per can. Later this was 
changed to a contract for three years, and a stock 
assessment on the amount of butterfat shipped dur¬ 
ing the year. This means today a capital of 
$350,000. Ten per cent of the paid-up capital goes 
into what is called a “redemption fund.” Out of 
this any member who is going out of the dairy busi¬ 
ness may receive the full value of his shares plus 
six per cent interest money. He turns his shares 
back into the association. This fund was started 
in order to take care of the large number of renters 
among the dairymen. They might he obliged to sell 
out at any time, and it was necessary to accommo¬ 
date them in order to get their support. Up to now 
it has always been possible to sell such shares to 
new members without touching the “redemption” 
fund. 
OBTAINING LOANS.—In financing the business 
at first these farmers had the usual trouble in ob¬ 
taining bank loans. Most of the shares taken by 
The title of this picture might well he called “ Co-operation.’’ It shows Charles 
Campbell, of Dansville, in his field of Luce’s Favorite silage corn. This corn 
was pooled and graded by the Suffolk County farmers through their co-operative 
association, distributed by the Few York Grange Exchange—a co-operative asso¬ 
ciation, the result of test carried on by the Farm Bureau a co-opei atne 
association. 
A Job of Tree Surgery. Fig. 60.1. (See page 181)) 
farmers were paid by notes. These were based on 
land and a steady and certain business in the sale 
of milk, but bankers did not like such security, and 
only after long argument would they advance money 
at the rate of 50 cents on the dollar. The producers 
finally obtained a credit of $10,000 at the bank, but 
as the business grew a much larger credit was 
needed. They went to the bank and asked for 
$150,000 credit secured by farmers’ notes. They were 
refused, but the directors of that association are 
made of sound stuff. They would not stay refused. 
They found among the bank officials a man who had 
faith in farm organizations. They put the case up 
to him so convincingly and showed so clearly how 
the money saved to farmers would get back into 
circulation that through his influence the bank 
finally gave them credit to the full value of then- 
notes. At the present time the organization has 
half a million dollars invested. 
GETTING CLOSE TO CONSUMERS.—At first 
the idea was to sell to the dealers and let them do 
the distributing, but as they studied the matter they 
saw that the only future in their business lay in 
getting as close as possible to the consumer. The 
dealers were not interested in increasing sales, and 
the producers knew that there could be no future 
growth in their business unless more and more milk 
could be disposed of. The sales would not increase 
unless consumers were made to understand the true 
value of milk, and felt that they were buying it at 
a bargain. So the producers started systematically 
to handle the retail milk trade in Vancouver. They 
are reducing the price of retail milk to consumers 
and thus increasing the demand. By saving in the 
cost of distribution they are able to sell cheaper and 
at the same time pay more to the producer. This 
past Summer the producers received S5 cents a 
pound for butterfat. One great saving has been 
made in handling by-products. The association 
handles over GO,000 gallons of ice 
cream each year and uses the skim- 
milk for making cottage cheese. 
D E A L E R S’ OPPOSITION.—The 
dealers put up a great fight at first 
At one time they tried to bring milk 
from over the Canadian line in the 
State of Washington. The dairymen 
there were well organized, and they 
knew better than to fight against an¬ 
other dairy organization. When the 
situation was explained to them these 
American daiz-ymen refused to ship any 
milk to Vancouver, and this gave the 
Fraser Valley Association power to en- 
foi-ce its demands and control the situ¬ 
ation. The dealei-s then attempted to 
fi-ighten the consumei-s and disci*edit 
the producers. Milk bottles were tam¬ 
pered with and every possible annoy¬ 
ance given. This contest led to a com¬ 
mittee appointed by the Vancouver city 
council to investigate the price of milk. 
The faz-mers were so well supplied with 
figures that this committee was forced 
to report that farmers ought to receive 
more than they were getting. 
NEWSPAPER ADVERTISING.— 
Then came a big duel of advertising in 
the city papei*s. The dealers, as usual, 
started it by attempting to show that 
they were losing money, while their 
business was necessary. The farmers 
came right back—advertising in the 
same papers—telling their story so that 
city people could understand it. Here 
is a sample of what they said: 
“Why is the middleman necessary now 
the producer is organized to handle hfe 
own product? Owned by 1.400 Fraser 
Valley dairymen, the Fraser Valley Milk 
Producers’ Association is a co-operative 
organization. Through its efforts the 
surplus milk supply of the flush season— 
the amount of milk produced over and 
above the quantity necessary to supply 
the Winter demand—has been handled in 
condenseries, cheese and ice cream fac¬ 
tories. or made into butter, whereas the 
middleman was formerly unable to dis¬ 
pose of the Summer milk surplus, result- 
ing in loss to both consumer and producer. 
The association has not only taken care 
of this surplus in an economical way, but by making 
more stable markets has encouraged milk production 
and thus lowered the cost of the milk during other 
seasons. , , , , , , „ . - 
"As to a better product, not one herd, but all herds 
supplying milk through the association have been im¬ 
proved. It was through the efforts of the association 
that government testing came into existence. If the 
prosperity of the farmers means the prosperity of the 
whole community, why not buy your milk from the 
farmer direct—Fraser Valley milk?” 
WINNING THE FIGHT.—This campaign won, 
and it will now be but a shoi-t time before 90 per 
cent of the retail milk in Vancouver is sold by the 
producers. The association was fair to the middle¬ 
men and has paid over $60,000 in cash for “good 
will.” The opposition from the condensers was 
hardest to overcome. There is one big Borden plant 
in the valley, and it is reported that this plant 
fought for three months to prevent the farmers from 
setting a price on their own product. They closed 
down their plant twice, “and for a time the stream 
ran white with the skim-milk which the farmers’ 
creamery could not dispose of.” The eondensery 
managers told the farmers they could not afford to 
pay such prices as were asked, and would have to 
sell out. The Milk Producers’ Association at once 
wired the head office for their price on the plant— 
at spot cash. The plant was at once opened as fast 
as word could get back from headquarters! 
RESULTS SECURED.—These dairymen have cer¬ 
tainly had a great life, and they have won their 
fight by organizing and carrying their oz-ganization 
down to the consumer. They were not satisfied to 
simply combine for wholesale selling. That does 
not pzit them in a position whei-e they can inci-ease 
sales, they get all the evil reputation of being 
“profiteei-s” and they get less than 40 cents of the 
consumer’s dollar. By taking up the work of dis¬ 
tributing their own product they command the situ¬ 
ation, get what is coming to them, get the respect 
of the consumers and increase the demand for milk. 
