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Show FARM CO-OPERATIVE SELLING By GLENN G. HAYES (,. 11)24, Western Ntwspaper Union.) One-Half Rice Sold Through Cooperative Plan. TTKN'IiY JACKSON has n rice plnn-tatinn plnn-tatinn in Arkansas 200 acres of the finest fields in the state. Anil lit' made money on those acres until the armistice was signed. That marked the furn In rice profits. Tlmt year the rice market took a downward shoot and for two years nothing could turn it from Its course. It was in October of 1020. For two months Henry Jackson had been holding hold-ing his creditors off with a "wait till my rice check comes." Then one day the long-expected letter came. It was waiting In the mail box at the crossroads cross-roads when Henry drove home from town a long, slim thin envelope with the miller's name In one corner. Out came the white slip. It wasn't a check at all. It was a bill for rice storage with a large "kindly remit" across its face. And Jackson wasn't the only Arkansas Arkan-sas farmer who received a "kindly remit" re-mit" notice Instead of a green bank draft. That particular crop was the most expensive that had ever been raised in Arkansas. Labor prices were the highest. The seed rices planted In the spring had been unusually expensive. Everything that had gone into the making of the 1920 rice crop was at, peak prices. Rice farmers all over the state had enlarged their operations to the last notch. They had mortgaged their land, their homes and their stock everything they had, to borrow money to plant rice. They expected a boom in rice prices and they got less than had ever before been paid for a rice crop. Practically the same thing happened In Louisiana and Texas, the other two great rice-producing areas . of the South. Everything went to pieces. The depression spared no one, no business, busi-ness, throughout the length and the breadth of the rice-producing districts. Co-operation, the Magic Word. Southern rice growers were down and out. They were ready to sell their acres for mere nothing anything to get out of the rice Industry. It was in the dark hour that the farm bureau proposed a way out co-operative marketing mar-keting was the suggestion. The magic word co-operation brought the dazed rice farmers back to consciousness. For the first time they set about to analyze their markets and find out just where the trouble lay. It wasn't hard to discover. Rice farmers sold their rough product prod-uct to the buyers, who in turn disposed dis-posed of it to the millers and sometimes some-times they sold It themselves direct to the millers. They knew that both the buyers and the millers were speculators. spec-ulators. The term miller and speculator specu-lator had become synonymous in the rice business. They knew that there were over 90 rice mills in America and thnt 85 per cent of them were controlled con-trolled by less than twenty men. It wasn't any secret that this little group of millers had in their power the complete com-plete price control. ' As long as the market had paid a living wage with an occasional extra spill for good measure the rice men merely grumbled among themselves and did nothing. In 1911 they had tried organization. The Southern Rice Growers' association associa-tion was formed in Louisiana to act as a growers' selling agent in dealing deal-ing with the millers. The organization organiza-tion was fairly well supported, but it didn't accomplish much. Then came the dark days of 1920. The association, associa-tion, urged by its members, tried to find a ay out. A plan of toll milling was tried, under which the growers turned their rices over to millers, who cleaned and milled and sold them, keeping a liberal amount for toll. That finished the growers. Under this system sys-tem came those bills for handling, with their big lettered "please remit" printed print-ed across the face. The prices for the the finest grades were so low that it seldom paid to haul them to the mills. The association had failed completely complete-ly ; the only thing left to do was to reorganize, not as a bargaining association, associa-tion, but as a full-fledged co-operative marketing association capable of controlling con-trolling its own markets. This was a stiff job for the growers were few in number and the rice growing areas were scattered In various parts of Louisiana, Arkansas and Texas. Leaders sprang up here and there xid offered themselves and their services serv-ices to the cause. In place of the old association a new movement was organized or-ganized the Arkansas Rice Growers' Co-operative association. This was started In January, 1921. The campaign cam-paign was carried on with grim determination deter-mination and In less than 90 days 800 growers, representing 80 per cent of the acreage of the state, were signed up and in time to market the 1921 crop. Based on Five-Year Contract. The association was based on a flve-, flve-, ar contract covering all the rice produced by the signer. The title to the rice passes to the association upon delivery. The crop is pooled by grades and varieties over an entire season's holdings. In this way the returns are equalized among the members. It is a nonstock, nonprofit organization, much the same as that of the other tuccessful producers' co-operatives. The association began marketin. the rice in the rough. They clean.-i and milled it and then sold it to whole sale dca'ors. The old-time speculativi buyer and miller were eliminated. Koi a few weeks thnjrs went along wel enough. The first rice sold over tlu association's tables brought $1.30 per bushel. Then came the smash in the market. It dropped and kept on dropping drop-ping till offers were hovering around an So-cent basis and there were few offerings at that figure. The condition continued. It began to grow worse. It didn't pay to sell rice in the rough ; there were too many intermediate interme-diate fees. The farmers must take over the mills and market their own rice in the clean. This was just the situation that the organizers of the marketing company had expected from the beginning; and they were prepared to meet it. Although the association had no mills or money, the milling problem was easily solved. Tentative contracts with several large rice mills were made through which to mill the rice of the co-operative members when it no longer paid the organization to sell the rice in the rough. The War Finance corporation offered to loan the rice growers 00 per cent of the market value of the rice as it was delivered. This money was to be used for' the first advance payments to the growers. grow-ers. The other payments were not to he made until the cleaned rice was on the market. Made More Than Neighbors. The rice farmers of Arkansas began their milling operations in the last week of November, 1921. This was not until the bulk of the choice rice In the state had been sold to outside mills in the rough. All that was left was the lower grades, but even with these the association averaged on all grades and varieties a fraction over 90 cents a bushel. The bulk of the entire crop in 1920 had gons at' 35 cents per bushel. During 1921 the association as-sociation handled 137,700,000 pounds of rice, for which Its growers netted $3,000,000. The Arkansas rice growers grow-ers received more for their rice than the growers of any other section. They made from 10 to 35 per cent more than their neighbor's in Louisiana. In 1907 It was discovered that the swamp land of the Upper Sacramento valley would grow rice. The Japanese Immediately took advantage of these acres, renting them on a one-year lease. Then they pitched in with their Oriental pugnacity to make rice production pro-duction pay. As the California rice Industry developed there grew up with It an organization half co-operative. The Japanese needed someone to sell their product for them. In 1915 the Pacific Rice Growers' association was organized, to serve merely as an agent with the exclusive right to sell all the members' rice. The grower, however, had the privilege of accepting accept-ing or rejecting the bids. Under this system each grower's rice was kept separately and was accounted for separately sep-arately after the expenses of handling had been subtracted. This way of selling was almost like a public auction. The association wasn't a real producers' co-operative. But it did give good results for about five years, but in 1920 it failed because be-cause the millers were afraid to buy the crop. The association was forced to adopt a new plan." Toll milling was tried. This meant selling polished pol-ished rice. Most of the growers were working their land on a one-year lease, and this prevented the association associa-tion from buying and operating Its own mills. But the tolls plan didn't work out, so they fixed up the original plan under a new name the Rice Growers' Association of California. The one-year contract was lengthened to five; that was the one big change In the plan. The title of the rice was to pass to the association upon delivery, deliv-ery, hut the original plan of selling each lot separately was retained. The association continued to refer all bids to the growers for acceptance. The War Finance corporation made them a substantial loan and the plan worked. There was no dumping of rice on- the market in 1021. That year the association handled more than 1,500,000 bags of the 1921 crop and sold them for an average of $2.05, which was almost 40 cents per bag higher than was made by the unorganized un-organized rice growers of Texas and Louisiana. Under One Contract. Texas and Louisiana saw what cooperative co-operative marketing was doing for Arkansas and California growers ; they decided to give the marketing game a whirl for themselves. In 1922 the Louisiana Farm Bureau Rice Growers' Co-operative association was organized. organ-ized. It was an exact pattern of the Arkansas association. A similar plan is now being worked out for east Texas. When Louisiana and Texas groups are well under way, it is planned to co-ordinate the three southern state associations under ont overhead machine. Rice farmers are putting their faith in co-operative marketing. They are giving it a trial lease on their rice fields. In 1921 not one pound of the 2,000,000,000 pounds of rice produced annually In the United States was sold on the co-operative plan. During the years 1022 and 1923 one-half of all the rice produced was sold through cooperative co-operative growers' associations. |