Report of the Federal Trade Commission on the Grain Trade

form of a letter of advice written by the agent; and in still other cases the bill of lading constitutes the only notice. In those cases where the elevator company draws on the consignee in advance on account of the shipment, the draft is attached to the bill of lading and deposited in the local bank instead of being sent direct to the commission company.

After the necessary documents have been prepared the car of grain is picked up by the railroad company and hauled to the terminal market or other destination.

Section 2. Agents' reports.

REPORTING BY LINE AGENTS.-Line elevator agents are usually required to make up a detailed daily report of business transacted, and these reports are mailed each day to the head office of the company, where they are carefully checked. Sometimes a daily load report (Appendix 6) is required of the agent and daily reports of receipts are practically always made up and sent to the head office.

The load report sets out the number of loads of grain received not only by the reporting elevator but also by each competitor. Weather and road conditions are also noted, and should farmers or "scoopers be shipping grain, this fact is so recorded in the space provided. By reference to these slips the company is able to keep a fairly close check upon the amount of business being done at the station and also whether their agent is proving himself able to meet existing competition and procure a proper proportion of the business. (Ch. XI, sec. 17.)

Line companies usually provide two blanks for reporting daily receipts, one for wheat, including durum, and one for coarse grains. These forms are similar to Appendix 7.

When the line company ships grain from the house, the shipment, as stated in the preceding section, is reported to the head office on the form known as Report of Shipment. (Appendix 5.)

Companies issuing storage tickets instead of scale tickets in buying grain (Ch. V, sec. 3) usually require their agents to return on the daily shipping report all local sales of grain for feed or seed, etc., either to farmers or others. Thus the Monarch Elevator Co. requires that all grain going out of the house, whether shipped or sold locally, must be reported on this blank. This is done for the purpose of clearing the agents' storage ticket account.

The reports required by line companies of their agents vary somewhat with each company. The general character and tenor of these reports, however, is much the same. In some cases agents of line companies are required to make periodical reports to their traveling superintendents in addition to those made to the head office. These reports, usually rendered weekly, give a summary statement of the week's business.

At the end of every month the line agents are required to submit to the head offices their expense accounts showing, among other things, the various bills paid by them.

REPORTS OF ELEVATORS OTHER THAN LINE.-Agents of individual elevators, whether cooperative, independent, or mill-owned, do not as a rule keep extensive records and reports of transactions such as are made up by the line elevator agents. Since such elevators are a unit in themselves, there is no home office to report to nor is the manage

ment_of_the_average individual elevator usually given to keeping complete and accurate records and reports. Line companies usually record in minute detail every step of the various operations. The other types of elevators as a rule keep as few records as possible, and at times these are exceedingly poorly kept. The situation in this respect is improving, however (Ch. X, sec. 4).

In a number of cases, however, country elevators other than line houses are obliged to submit to commission houses detailed daily reports similar to those required of line company agents. When, as is frequently the case in the Northwest, the elevator is financed by a commission company, the latter organization in many cases requires such reports as a measure of protection to itself, and in such instances records and reports comparable with those of line agents may be made. (Ch. X, sec. 4.)

Section 3. Destinations of country elevator and warehouse shipments. TOTAL MOVEMENT. Of 1,541,391 cars of grain reported by country elevators and warehouses as shipped during the five crops years1912-13 to 1916-17 (Appendix 2, inquiry 6)-about 70 per cent went to cities which received 5,000 or more cars during this period, or an average of more than 1,000 cars a year. These cities were arbitrarily classed as terminal markets as distinct from other geographic points receiving less than 5,000 cars during the period and from various commercial factors to which shipments were also reported. The following table presents the number of cars shipped to each of the 23 markets to which country elevators and warehouses reported shipments of 5,000 or more cars during the five crop years, 1912-13 to 1916-17, together with the percentages of total shipments to all destinations:

TABLE 34.-Number of cars shipped to specified markets receiving more than 5,000 cars and proportion of total shipments reported by country elevators and warehouses, crop years 1912-13 to 1916-17.

From this table it appears that slightly less than 70 per cent of the total reported shipments went to terminal markets. Another and smaller proportion (7.08 per cent) of the total shipments went to various geographic points receiving less than 5,000 cars. The balance, or about 23 per cent, was sold to mills, feeders, interior brokers, maltsters, retailers, etc. The following table presents the numbers and proportions of cars moving to various destinations from all reporting country elevators and warehouses:

9964°-20-9

TABLE 35.-Destination of total shipments from all reporting country elevators and warehouses for the five crop years 1912-13 to 1916-17.

Miscellaneous, including private terminal elevators, maltsters, and other converters, retailers, etc.

Total....

1,070, 027

69.42

109, 108

7.08

208, 229

13.51

30, 236

1.96

93,334

6.05

MOVEMENT BY STATES AND GRAND DIVISIONS.-The next table presents by States and grand divisions and according to destination the movement of the total grain (i. e., wheat, corn, oats, rye, and barley) reported as shipped by country elevators and warehouses during the five crop years 1912-13 to 1916-17:

TABLE 36.-Distribution of total shipments of five principal grains from country elevators and warehouses in specified States and grand divisions according to specified destinations during the five crop years 1912-13 to 1916–17.

Private terminal elevators, retailers, maltsters, and other converters, etc.
* For States included in the various grand divisions, see Ch. II, sec. 5.

The direction of the movement of grain from the country elevators and warehouses is governed by a wide variety of conditions, the complexity of which renders any explanation more or less unsatisfactory. It is, however, possible at least to point out certain factors which undoubtedly exercise an important influence upon this flow.

As already indicated, a little less than 70 per cent of all grain shipped by country elevators goes to the terminal market. Only 6, however, of the 14 principal grain-producing States, i. e., Illinois, Iowa, Wisconsin, Minnesota, and the Dakotas, report a higher than average proportion of total grain shipments to terminal markets. While thus considerably above the average in its proportion of terminal market shipments, this area as a whole is consistently below the average in the percentage of its shipments which go to mills, feeders, interior brokers, and the smaller markets. In the balance of the 14 principal grain producing States, i. e., Oklahoma, Michigan, Ohio, Kansas, Nebraska, Montana, Missouri, and Indiana, the reverse of this situation obtains, and much higher than average proportions of their shipments go to small markets, mills, feeders, etc., and a much lower than average proportion to terminal markets (as low as 28 per cent from Michigan and Oklahoma). Section 4. Relation of size of terminal markets to country grain movement. REPORTED RECEIPTS OF COUNTRY GRAIN AT DIFFERENT TERMINAL MARKETS.-There appears to be good reason for assuming that the proportion of terminal market shipments by country elevators from a given area as compared with shipments to other destinations will be considerably affected by the size of the terminal markets to which the area is tributary. Other things being equal, the larger the market the greater the number of buyers, the keener the competition between them, and the higher the resulting price that will be obtained for grain. Thus size may become an attractive force, leading to a high proportion of terminal market shipments by rendering it difficult for the smaller markets and local buyers to compete with such

markets.

An examination of Table 36 reveals the fact that five of the six States reporting the highest proportion of terminal market shipments, i. e., Minnesota, the Dakotas, Iowa, and Illinois, are very directly tributary to Chicago and Minneapolis.

The balance of the principal grain-producing States are tributary chiefly to other primary markets; for example, Kansas and Nebraska to Kansas City; Michigan to Detroit; Missouri to St. Louis; Ohio to Cincinnati; Indiana to Indianapolis, Cincinnati, and Detroit. (See Table 37.)

Based on the shipments reported by country elevators and warehouses, Minneapolis during the five-year period received something over 300,000 cars of grain and Chicago 262,000. The reported receipts of country grain at each of these two markets, therefore, are between three and four times as great as those at Kansas City, the third largest market in point of country receipts, as reported, and are many more times the receipts at the small terminal markets. (See Table 37.)

5 Wisconsin not included.

DIRECTION OF GRAIN MOVEMENT.-The size of the Chicago and Minneapolis markets as compared with the various other terminal markets is greatly affected by the direction of the grain movement and the location of the markets with reference to production. Broadly speaking, the general current of the grain movement is from the surplus to the deficit areas, or from west to east, with a certain amount of southern and southeastern flow, there being comparatively little westward, northern, or southwestern movement. This appears more concretely from Table 37, which presents the proportion of the total country receipts of the principal terminal markets which are derived from each of the 14 principal grain-producing States and various grand divisions during the crop years 1912-13 to 1916–17.

TABLE 37.-Distribution of country grain shipments to specified terminal markets as reported for crop years 1912-13 to 1916-17.