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Commercial grain charges on the Pacific coast have been an argument in favor of elevator methods, especially when they were compared with the charges at terminal points in the Mississippi valley, or with those in New York city. At the very outset, the sacks add a cost of 4 cents per bushel of wheat, an expense which, according to the above statistics of charges, is probably equal on an average to the entire commercial charge involved in getting a bushel of wheat from the Red river valley through country, terminal and Atlantic seaboard elevators and transferring it on board ship at the Atlantic port. While there was no storage charged at the local warehouse on the Pacific coast for the first 6 months, the handling charge paid the local warehouseman during this time was 1.5 cents per bushel. Each month after this time involved a charge of 0.3 cent per bushel. Since there was little capital invested in local warehouses, the charge for handling the wheat must have been about 1.5 cents per bushel, even if it was sold immediately. At Portland, 60 days' storage, including the discharging of cars and truckage across the dock to ship, involved a charge of 1.2 cents per bushel. This charge became 1.8 cents when grain was also loaded on the vessel, which made the charge for merely transferring to vessel 0.6 cent. After 60 days, storage charges were one-eighth cent per bushel for 10 days. Storage charges at San Francisco were 1.5 cents a bushel per year. The charge for loading wheat on vessels was 0.75 cent per bushel, and that for weighing was nearly 0.25 cent per bushel.
The greatest portion of the expense on the Pacific coast would seem to be for handling the wheat, while on the Atlantic coast it is for storage. Receiving grain, storing it 60 days, and discharging it involves a cost of 1.8 cents per bushel on the Pacific coast and 1.875 cents on the Atlantic coast. When delivered to vessels, there is an additional storage charge of 0.5 cent per bushel, making 2.375 cents on the Atlantic coast. Storage for 60 days costs two-thirds cent on the Pacific coast, and handling the grain costs 1.13 cents. Storage for 60 days at New York costs 1.25 cents, or, if it is to be loaded on vessels, 1.75 cents, which leaves a cost of 0.125 cent for handling. It costs, therefore, about 1 cent a bushel more at the seaboard port to handle wheat in sacks than to handle it by elevator methods. At the country elevator, however, there is a gain of perhaps half a cent when the grain is sacked, but the Pacific coast warehouse is often merely a platform, which in a different climate would afford no protection to the grain. If elevators had to be built, it would materially raise the cost at the country elevator, making it higher than 2 cents per bushel. As it is, on the whole, the cost is about 4 cents per bushel greater when wheat is handled in sacks than when it is handled by elevators. In some states warehouse rates are regulated by law. Discriminations are often practiced by elevator people, especially in eliminating independent competitors. In the interior of the country, the total cost of distributing wheat varies from 10 to 30 per cent of the price paid by the consumer. The average cost has been given as 9 cents per bushel. The cost of getting wheat to the seaboard has been given as 10 1-3 cents on the Pacific coast, and 14 or 15 cents on the Gulf and Atlantic coasts. The total cost from the United States to England was about 20 cents by way of Atlantic ports, 22 to 23 cents by way of Gulf ports, and 30 cents by way of Pacific ports.
The Rise and Progress of the Grain Trade of the United States is one of the greatest marvels of an age noted for its commercialism. Its entire history would form almost a complete record of the development of the American continent, for it was the major factor in the opening up of three-fourths of our settled domain. The pioneer husbandman formed the vanguard in the march of civilization. The first succeeding ranks were formed by the merchant. Then came in quick sequence the panoramic array of our ocean, lake and river fleets, of our canals, of our wonderful storage and transportation systems, and of our commercial institutions.
The cereal crop has been the distinctive feature of rural industry in the United States. Here, as in every agricultural community, the three concentric circles of distribution which arose were centered in the local market, in the city market, and in the foreign market. In the modern wheat industry, wheat farming is mainly for a commercial surplus. A minor portion of the wheat grown is consumed or retained on the farm, while the great bulk of wheat is poured into the streams of local, interstate and international commerce. The major factor in that part of the cereal crop which figures in the internal trade and foreign commerce of our nation is composed of wheat. Much more corn than wheat is produced in the United States, but only a minor portion of this corn becomes a factor in its raw form in the domestic trade of the country, while a comparatively insignificant portion is exported. Less than 3 per cent of the corn grown in the United States in 1906 was exported, and only 25 per cent of that grown in 1905 found its way into the channels of domestic trade. For the last decade of the nineteenth century, the exports of wheat from the United States were over one-third of the amount grown, while those of corn were only one-fifteenth. For the year 1902, ten-seventeenths of the wheat grown, but only twoninths of the corn, was shipped outside of the county where it was raised.
Thus the per cent of wheat exported from the United States is five times as large as the per cent of corn, while the per cent of wheat shipped outside of the county where grown is nearly three times as large as that of corn. Wheat is the keystone in the arch of commodities which is buttressed on consumption and production, and which supports the great commercial superstructure that, with its many ramifications, unites into a threefold nexus of interests—rural producer and urban consumer, manufacturer and agriculturist, and the producers engaged in diversified extractive industries. The grain movement has a function in the national economy second in importance to that of no other factor in our agricultural life. Directly and indirectly, it is the chief feature in our commercial relations.
The Three Methods of Marketing Wheat utilized by the American farmer depend upon the amount of wheat that is grown. The largest farmers make a wholesale disposal of the bulk of their wheat, watching a good opportunity to sell, or employing agents to watch at the chambers of commerce or boards of trade of such primary markets as Duluth, Minneapolis and Chicago. A large class of less extensive growers obtain a price remarkably close to city quotations by forming close business relations with commission men at the large terminal points. By shipping their grain directly, they avoid the middleman charge of the local dealer. The great mass of smaller farmers sell to the local elevators. The profits of the local buyers, however, have quite frequently been scaled to the lowest notch by competition.
The Buyer of Wheat is always located within hauling distance of the producer's home. There are two classes of buyers, the local grain dealers and the dealers who represent the terminal grain buyers. The general policy of the railroads has been to rely upon these two classes of buyers to provide the country elevator facilities needed for receiving and shipping grain, and to enable them to do this promptly by furnishing them with adequate transportation facilities. The terminal grain buyers, controlling lines of hundreds of elevators, have been the most important factor in the producer's grain market. The local buyer is usually a dealer engaged exclusively in the grain business, but frequently, especially in Minnesota and the