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its dependence on the lake region, had the important effect of creating direct routes from the west to seaboard cities other than New York and New Orleans. This resulted in a competition between the Atlantic seaboard cities for the grain trade, and a considerable loss of traffic from New York to such cities as Montreal, Boston, Philadelphia and Baltimore. Of the competing roads to the Atlantic, the New York Central had the greatest natural advantages. By means of reckless competition, however, other roads wrested differential concessions from the Central. The trunk lines endeavored to equalize opportunities for securing eastward traffic by agreeing that the less favored roads should maintain rates that were lower in proportion to their disadvantages. This differential arrangement began in 1869, and in different forms it has been maintained since that date. It has been claimed that New York was not as progressive as other Atlantic ports in methods of handling grain. The net resultant of the differential and of other causes was a decline in the proportion of the grain trade done by New York, for grain could move more economically from the primary markets to Europe by way of ports north and south of New York; Chicago grain reached Europe more largely through Canadian facilities.

The southern movement of the grain traffic is the next phase to be considered. This is characterized by a competition first between the southern railroads and the Mississippi, and subsequently between the southern and eastern railroads. It resulted in southern railroads securing the bulk of the grain traffic from the Mississippi, and they are diverting a continually increasing quantity of grain from the Atlantic coast. In 1873 New Orleans participated to the extent of less than 0.5 per cent in the wheat export. But little of the south-bound grain was then intended for export, while about 20 per cent of the east-bound grain was exported. In the early seventies about 75 per cent of the south-bound grain was shipped by water and 25 per cent by rail. Before the close of the nineteenth century this ratio was reversed, less than 25 per cent of the grain being shipped by water. Thus the railroads, both on the eastern and southern routes, demonstrated their capacity to compete successfully with water transportation. For 50 years or more, competition among the railroads, and between the railroads and the eastern water route, has centered in Chicago. The most recent phase of the competition for the great bulk of the wheat grown in the north central portion of the United States is that of the competition between the eastern and southern railroads. Of Atlantic ports, New York alone is falling behind in commerce. New York once held 75 per cent of the nation's commerce, but now holds less than 50 per cent. This tendency towards a division of commerce among different cities is eminently a healthful one. The construction of the New York state barge canal has been advocated as a means of enabling New York to regain and retain the grain trade. In view of the successful competition of the railroads with water routes, however, as well as the competition of the Canadian canal and the St. Lawrence, it is not probable that the proposed canal would attain the object aimed at. The question is, however, still considered an open one.

While differentials have exerted a great influence tending to distribute export grain among the different seaboard cities, the securing of through-railroad connections has also been a prime factor in diverting traffic. Within the past 15 years, New Orleans and Galveston secured through connections, which enabled them to receive grain shipped from the primary markets of the southwest at a rate below that which was prevailing to the Atlantic seaboard. Consequently the importance of the Gulf cities as grain ports, and especially as wheat ports, has greatly increased. The percentage of wheat exported from the Gulf ports has risen steadily from 2 per cent in 1884 to 55 per cent in 1904, and the percentage for the Atlantic ports decreased from 59 per cent to 20 per cent during the same period. The corresponding variations in the percentages for both wheat and flour were from 2 to 28 per cent for the Gulf ports, and from 69 to 48 per cent for the Atlantic ports.1 Within recent years through railroad connections have also greatly aided Newport News as an exporting city of wheat from the Atlantic coast.

Distance from Seaport to Primary Market is another factor in determining the direction taken by export grain. Some of the principle distances in miles by the best routes are as follows: From Duluth to Portland, Maine, 1330, to Boston 1400, and to Baltimore via Chicago, 1280; Chicago to Baltimore 802, 1 U. S. Dept. Agr., Bu. of Statistics, Bui. 38 (1905), pp. 10-28. and to New Orleans 914; St. Louis to Mobile 644, and to Baltimore 930; and Kansas City to Galveston 873. The railroads which cross the Allegheny mountains are not as level as those which follow the shores of the great Lakes, or as those which extend down the Mississippi valley, and as a consequence it costs them more to carry grain. The Gulf ports have a disadvantage on account of the tropical character of their climate, for flour and wheat, especially if northern grown, are more apt to deteriorate there than in a cooler climate.

Wheat Grown on the Pacific Coast passes into the export channels through the Pacific ports. This trade is very distinct from the rest of the wheat trade of the United States. It formed about 33 per cent of the total export trade in the ninth decade, but the amount fell to less than 25 per cent by 1900. Under abnormal conditions in 1905, however, the Pacific coast exports were 92 per cent of the wheat, and 41 per cent of the wheat and flour. It is probable that the development of Oriental commerce and western transportation facilities will increase the wheat exports from the Pacific coast.

Lake Shipments.—In 1867 the iron steamship was rapidly replacing sailing vessels on the Great Lakes. In 1900 the largest class of lake vessels, known as ''whalebacks," carried 250,000 bushels of wheat in a single load. This amount rose to 380,000 bushels in 1906. At 12.5 bushel per acre, one shipload represents the wheat harvested from 30,400 acres of land. In point of tonnage, Duluth, on Lake Superior, was the second port in the United States at the close of the nineteenth century, having been exceeded by New York only. The Sault Sainte Marie canal carried 2.5 times as much tonnage in eight months as the Suez canal in a whole year. During October, 1902, 14,971,318 bushels of east-bound wheat passed through this canal, and also 1,298,751 barrels of flour.

Statistics Pertaining to Rail Shipments.—An empty car weighs on an average about one-third of the gross weight of a loaded car. Twenty years ago 1,020 tons net weight was the best load of grain that could be hauled in one train in the United States. The maximum weight (dead and paying load) hauled by the New York Central in ordinary grain practice is at present from 3,300 to 3,500 tons in a train containing over 60 cars of 30 tons of paying load each; 80 cars having a gross weight of 4,500 tons, have been hauled over the line in a single train; 85 loaded cars in one train is the outside limit, and not many more empty cars can be hauled on the return trip. Even 70 cars in one train is too wearing on the engine to be profitable. The prime cost of moving a sixty-car grain train, that is, the cost at which a few extra trains could be run over the line without loss where ordinary traffic pays for maintenance and fixed charges, is estimated to be considerably below one dollar per mile, very probably under 65 cents.1 Single wheat cars weighing 139,000 pounds and containing over 2,000 bushels of wheat have been shipped. About 25 years ago, 450 to 500 bushels were considered a large car load and a 1,000-bushel car was unheard of.

When properly shipped, all cars are sealed in transit. There is, however, considerable carelessness in shipping. For example, out of a total of 202,352 cars arriving at the five terminal points in Minnesota during 1905, 9,112 arrived in "bad order." Of these, 3,981 were not sealed; 647 had the seals broken; 1,019 had open end and side doors; 1,330 had poorly fastened doors; 878 had leaky grain doors; 259 had leaky ends and sides; 970 had doors unfastened; and 28 were without doors. Grain is lost from such cars by theft and leakage.

When shipments of grain are heavy there is often a shortage of grain cars. During such times of car shortage it is a common railroad practice to utilize the cars so as to secure the greatest possible amount of the grain traffic, taking into consideration that competing roads will also secure as much traffic as possible. In such cases buyers located at non-competitive points and having their elevators full to overflowing may lose several hundred dollars per day because they cannot secure grain cars.

The railroads often pursue a generous and far-sighted policy for the benefit of all concerned. Such cases are where transportation is furnished, often free of charge, for experts investigating questions connected with agriculture, and for farmers' meetings which are held in the interests of agriculture. The thousands of harvest laborers which the roads annually transport at greatly reduced rates, and even without any direct remuneration, is another case in point. The railroads recognize 1 Interview with competent observers.

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f that their prosperity depends upon the prosperity of the farmer, and that they cannot transport the crops which he fails to harvest.

Transportation from Seaboard to Foreign Market.—The increased exportation of American cereals, especially of wheat, dates from the middle of the nineteenth century, and was coincident with an increased demand for grain abroad. Europe's extremity in grain has always been America's opportunity. The chief features in the development of wheat exportation from the United States were a decrease in cereal production in western Europe; an increase in the demand for grain, mainly in the United Kingdom, Germany, Belgium, Holland and Switzerland; the laying of the Atlantic cable; the commercial grading of cereals; and the economies effected by modern elevator and transportation methods. Prior to 1850, not more than from 1 to 9 per cent of the production of agricultural nations, or of the consumption of manufacturing nations, was a factor in international trade.1

The first direct shipment of grain from the Great Lakes to Europe was a cargo of wheat in 1856. Out of 125 cargoes thus going in the next eight years, only three or four carried grain. The first wheat shipped from the Pacific coast around Cape Horn was sent to New York. The grain was of such a novel character that the New York millers did not know how to manage it, and the venture was not a success. In 1860 California made its first shipment of wheat to England. The English millers sent back for instructions how to mill this grain, but it found a ready market there. By 1901 about half of the wheat flour shipped from San Francisco went to China, Japan and the East Indies, but the United Kingdom still received the greater portion of wheat. At that date, 12 ships per month were leaving San Francisco loaded with flour for the Orient, whereas only a few years before there were but two or three.

In 1900 a load of 82,000 bushels of wheat was shipped from Portland, Oregon, to Yokohama. This was the first cargo made up of wheat alone that ever crossed the Pacific to Japan. In the same year at the same port a cargo of wheat was loaded for Europe to go the route by way of Japanese, Chinese, Philippine, and Indian ports through the Suez canal to the Mediter1 Emery, Speculation in U. S., p. 106.

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