THE UNIVERSITY

OF ILLINOIS

LIBRARY

cop.

ACRIGUITURE

CIRCU

CHECK JDIRCULA

St. Louis Milk Problems

With Suggested Solutions

Boston

^Minneapolis New York

R.W. Bartlett

Los Angeles j! Milwaukee ® Cleveland

? Philadelphia * ^Pittsburg

Chicago

Low store prices in boston and New York and low wagon -54

prices in Minneapolis have .5

caused high milk consumption. In St. Louis low incomes and high milk prices have caused low sales. Bottles show daily per capita consumption in 14 U.S. cities.

University of Illinois Agricultural Experiment Station Bulletin 412

Detroit

^n Francisco

Acknowledgment

For the willingness with which various organizations and agencies in the St. Louis milk-producing and sales area have supplied information essential to this study, the author expresses his sincere appreciation. Producers' as- sociations, distributors, consumers' organizations, conden- series, and milk haulers have given the study their hearty support.

A substantial part of the funds used in financing the project was supplied by the St. Louis Milk Market Ad- ministration thru the interest of the Administrator, Mr. Fred L. Shipley, who realized the need for facts as a basis for market decisions. In accepting these funds the Uni- versity adhered to its established policy of reserving the right to publish the findings in a thoroly impartial manner thru such channels as it might choose.

It is hoped that this report of milk-producing and marketing conditions in the St. Louis area will help to give all those interested a clearer understanding of the economic problems involved in placing so important a commodity before the consumers of the area and will assist them in working out just solutions.

CONTENTS

PAGE

PRESENT MILK CONSUMPTION IN ST. LOUIS 94

Daily Per-Capita Consumption 94

Benefits From Larger Consumption 97

CAUSES OF LOW MILK CONSUMPTION IN ST. LOUIS 99

Low Family Incomes 99

Other Foods Relatively Cheaper Than Whole Milk 101

Evaporated Milk an Effective Competitor 104

Hot Summers and Lack of Refrigeration Discourage Use of Fresh

Milk 107

Nationality Not a Major Cause 109

HOW ST. LOUIS MILK SALES MIGHT BE INCREASED 110

Greater Per-Capita Consumption 110

Adoption of Lower Prices for Store Milk Ill

Enlargement of Educational Program 113

Districts Most Favorable for Store Sales 114

WHY PRICES TO PRODUCERS DECLINED FROM 1929 to 1933 117

Downward Trend of General Price-Level 117

Lower Prices for Feeds 118

Decline in Consumers' Incomes 120

Increase in Number of Cattle 123

Whole-Milk Prices Affected by Condensery Prices 124

THE BASIC-SURPLUS PRICE PLAN 125

Advantages in Open-Market Policy Under Plan 125

Different Kinds of Milk Surpluses 126

Production More Even Under Basic-Surplus Plan 128

Basic-Surplus Plan Not Cause of Price Decline 130

DISTRIBUTORS GROSS HANDLING MARGINS 131

Proportions of Milk Utilized in Different Forms 131

Retail and Wholesale Sales of Class I Milk 133

Gross Handling Margins on Class I Milk 134

ST. LOUIS MILK MARKET ORGANIZATIONS: AIMS AND

ACCOMPLISHMENTS 135

Sanitary Milk Producers 136

Milk Distributor Groups 136

Consumers' Milk Commission 137

St. Louis Consumers' Council.. . 138

PAGE

St. Louis Division of Public Health 139

St. Louis District Dairy Council and Dairy Commission 140

Production Credit Associations 141

Dairy Herd Improvement Associations 142

PRESENT POLICIES UNDER THE FEDERAL MILK LICENSE 143

Purposes and Scope of License 144

Functions of Milk Market Administrator 144

Use-Classification Principle Recognized 145

Producer Prices in St. Louis Area 146

Producer Prices Converted to Weighted Average 147

Reasons for Price Differences Based on Milk Use 150

Equalization Fund Eliminates Destructive Price Cutting 152

Distributors Bonded to Insure Pay to Producers 155

All Producers Contribute to Service Fund 155

Price Conferences a Necessary Part of Any Plan 157

SUMMARY 158

RECOMMENDATIONS 159

APPENDIX 161

Detailed tables not essential to the text are shown in the Appendix.

Urbana, Illinois April, 1935

Publications in the Bulletin series report the results of investigations made by or sponsored by the Experiment Station

St. Louis Milk Problems, With Suggested Solutions

By R. W. BARTLETT, Assistant Chief in Agricultural Economics1 HE ST. LOUIS milk sales area has experienced rapid increases in population during the past thirty-five years. Confined to a city of 605,000 in 1900, the area (Fig. 1) now includes approxi- mately 1.3 million people, or almost twice the earlier number.

Coincident with the rapid growth in the size of this market has occurred a concentration of the business of distributing milk in the hands of relatively few dealers, an expansion of the milkshed (Fig. 2) accompanied with increasing dissatisfaction among producers because of prices paid them for their milk and dissatisfaction among consum- ers because of the quality and cost of the milk delivered to their doors. Producer dissatisfaction has resulted in numerous "strikes." Con- sumer dissatisfaction has recently been evidenced by the development of consumer organizations with various objectives, including that of improving the quality of the milk sold in the area.

Concerted effort to improve milk-marketing conditions in this area culminated in the adoption, on November 25, 1933, of a federal milk marketing agreement approved by the Agricultural Adjustment Admin- istration under the authority of the Secretary of Agriculture, and a federal milk license, which became effective March 2, 1934.

The purposes and powers of the license are broad in nature. Each of its provisions is capable of interpretations and applications vitally affecting all groups producers, distributors, and consumers inter- ested in the milk industry. It is therefore important that the policies developed under this license shall be mutually beneficial and shall tend to promote harmonious solutions of the problems that arise from time to time. It was in order to have a factual basis on which desirable policies might be determined that the Milk Market Administrator ar- ranged for the study reported in this bulletin.

No attempt has been made by the author to formulate sure reme- dies for all the problems that confront the dairy industry in this area. The aim has been first to present the facts bearing on the situation and then to offer suggestions that may help to solve some of the more vexing problems in this market.

'The author acknowledges the assistance of T. R. Hedges, B. T. Inman, W. H. Casky, and Edgar Burtis, who supervised the assembling and tabulation of the data for different sections of this study.

93

94

BULLETIN No. 412

[April,

FIG. 1. THE ST. Louis MILK SALES AREA AS DEFINED BY FEDERAL MILK LICENSE, NOVEMBER, 1934

The St. Louis milk sales area is shown within the heavy black lines. It in- cludes approximately 832 square miles and 1.3 million people, of which about 400,000 are outside the 26 Census districts of the city.

PRESENT MILK CONSUMPTION IN ST. LOUIS Daily Per-Capita Consumption

The daily per-capita consumption of milk at St. Louis in May, 1934, was the lowest of the 14 largest cities in the United States, all these cities having populations of more than 500,000 (see cover illustration and Table 1 ) .

The people of Boston had the highest per-capita consumption, a daily average of more than Y\ (.77) pint; whereas in St. Louis the average daily consumption was .42 pint. St. Louis consumption was only one-third the amount recommended by nutrition authorities and only about half the amount generally considered as the minimum for

19351

ST. Louis MILK PROBLEMS

95

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FIG. 2. VOLUMES OF MILK PRODUCED IN THE ST. Louis MILKSHED

FROM JUNE, 1933, TO MAY, 1934

The four counties producing the greatest volumes of milk for the St. Louis market are Madison, St. Clair, Clinton, and Washington all in Illinois. Ap- proximately 417 million pounds of milk were produced during the above period, of which 64 percent was produced by members of the Sanitary Milk Producers.

the maintenance of good health. Even the per-capita consumption in Boston was considerably below the latter standard.

The consumption of milk in the different Census districts of St. Louis (Fig. 3) varied even more widely than among the 14 largest cities.1 In Districts 14 and 16 it averaged nearly ^ pint per person per day; whereas in District 21 it was less than y$ pint. In eleven districts it was higher than the average for the area; whereas in thirteen districts it was lower than the average. Districts 1 and 8 had

'Unpublished data from a study made by C.W.A. workers under the di- rection of Mrs. M. C. Harrington of the St. Louis District Dairy Council. Parts of the study were published by the St. Louis Department of Public Welfare, Division of Health, in "Food Habits Survey," 1934.

BULLETIN No. 412

[April,

TABLE 1. DAILY CONSUMPTION OF MILK IN THE 14 LARGEST MILK SALES AREAS IN

THE UNITED STATES, ALL HAVING POPULATIONS OF MORE THAN

500,000, MAY, 1934"

Area

Amount of milk sold daily

Population of area

Daily con- sumption of milk per person

Boston

thousands of pints 1 574.5

2 052 000

pint .767

Minneapolis (1933)

372.2

516 000

.721

New York

7 173.9

10 275 400

.698

Los Angeles (June, 1934)

1 163.9

2 485 000

.650

490.8

761 800

.644

Cleveland

880.2

1 385 400

.635

Philadelphia ...

1 594.4

2 674 100

.596

Pittsburgh

802.0

1 400 800

.573

Chicago

2 674.4

4 952 700

.540

Detroit

1 161.7

2 174 000

.534

San Francisco (1932)

339.4

645 700

.526

Buffalo .

282.6

586 300

.482

Baltimore (Jan.-June, 1934)

448.0

1 047 500

.428

St. Louis

551.7

1 303 100

.423

•For more detailed data, see Appendix, Tables 18 and 19, pages 161 and 162.

DISTRICT NUMBER

MILK CONSUMED DAILY PER PERSON -PINT 0 .10 .20 .30 .40 .50 .60

14 16 19 5 2 3 1 5 6 12 17 4 1 8 10 7 9 13 16 24 22 20 26 23 11 25 21

.56 .56 .54 .53 .52 .52

.49 .46 .48 .48 .45 .42 .42 .41 .41 .41

.41 .40 .40 .39 .38 .38 .36 .26 .24 .19

^^|

FIG. 3. DAILY CONSUMPTION OF MILK PER PERSON IN THE DIFFERENT CENSUS DISTRICTS OF THE CITY OF ST. Louis, 1934

In Districts 14 and 16, where family incomes are relatively high (see Fig. 6), the daily consumption of milk per person averaged nearly three times as much as in District 21, where incomes are low. The average consumption in the en- tire sales area was ^ (.42) pint per person daily.

1935] ST. Louis MILK PROBLEMS 97

the same per-capita consumption as the average for the entire area, .42 pint per day.

The information on per-capita consumption given above was ob- tained from replies to a questionnaire answered by 8,136 housewives in St. Louis. Every family on at least one street in each district and other families scattered thru the district were interviewed (Fig. 4).

Benefits From Larger Consumption

The per-capita consumption of milk is coming to be recognized by leaders in the whole-milk1 industry as one of the best standards for measuring the efficiency of the industry. A high per-capita consump- tion of high-quality milk would benefit consumers, producers, and dis- tributors alike.

From a health standpoint a quart of milk a day for children and a pint for adults is recommended by nutrition authorities2 as highly desirable. On a weighted basis this is equivalent to about lJ/3 pints daily per person; yet the average daily consumption of milk in the United States is less than half this amount, and in many markets, in- cluding St. Louis, it is not more than one-third. Hence from the view- point of consumers, increased per-capita consumption of milk in the St. Louis area is of material importance.

To farmers, increased per-capita consumption of milk means higher gross incomes, for milk utilized in fluid form commands a higher price than that utilized as cream or manufactured into other products. If the per-capita consumption of milk in the St. Louis sales area were in- creased to the Boston rate, producers in the St. Louis milkshed would benefit to the extent of about $1,300,000 a year.3 This would mean an average increase of about $125 a year to each producer. Since the present whole-milk demand in this market is only about half the total production in this dairy district, such an increase in whole-milk sales could be supplied largely by dairymen now in the market.

Other increases that might be expected to occur in the income of producers in the St. Louis milkshed as the result of certain increases in per-capita consumption are shown in Fig. 5.

Milk dealers in the St. Louis area would benefit by a substantial increase in milk consumption if the increased sales were to be handled

'In this bulletin the terms whole milk, fluid milk, fresh milk, and Class I milk are used synonymously.

"Recommended by Drs. E. V. McCollum, H. C. Sherman, and M. S. Rose.

*This represents the net gain that would accrue to producers as a result of their receiving the Class I price for the additional Class I sales, instead of the Class III price for this volume, as at present.

BULLETIN No. 412

[.April,

1935]

ST. Louis MILK PROBLEMS

99

by the present number of distributors, for very little additional equip- ment would be needed in order to handle the larger volume, and unit operating costs would consequently be reduced.

ASSUMING SALES EXCEEDED PRESEN T B\

ADDITIONAL INCOME FOR MARKET

20 PERCENT 40 PERCENT 60 PERCENT 80 PERCENT 100 PERCENT

THOUSANDS OF DOLLARS

40O 6OO 1200

ADDITONAL INCOME PER FARM

ASSUMING SALfS EXCEEDED PRESENT BY

20 PERCENT 40 PERCENT 60 PERCENT 80 PERCENT 100 PERCENT

DOLLARS ADDITIONAL INCOME 0 30 60 9O 120 150

FIG. 5. How FARMERS IN THE ST. Louis MILKSHED WOULD BENEFIT BY

CERTAIN PROPORTIONAL INCREASES IN MILK CONSUMPTION

IN THE ST. Louis SALES AREA

If the per-capita consumption of milk in St. Louis were increased to that of Boston, fluid-milk sales would be increased about 83 percent. Such an in- crease would bring producers about $1,300,000 more income annually, or an average of about $125 to each producer. Even smaller increases would have marked effect on producer income.

CAUSES OF LOW MILK CONSUMPTION IN ST. LOUIS Low Family Incomes

The low per-capita consumption of milk in St. Louis is undoubtedly due basically to the large number of families having low incomes. On the basis of rentals reported in the 1930 Census and corrected to a 1934 basis, about one-third of the families had incomes averaging about $800 a year, another third about $1,600 a year, and the remainder about $3,650 a year (Table 2). The average family income in each of the St. Louis Census districts is shown in Fig. 6. The lowest was $999 in District 25 and the highest $3,255 in District 5.

100

BULLETIN No. 412

[April,

TABLE 2. NUMBER OF FAMILIES PAYING RENTALS INDICATED, AND AVERAGE INCOMES OF CERTAIN INCOME-GROUPS, ST. Louis, 1930 AND 1934

Monthly rentals*

Mid-point of monthly rental

Yearly average

Number of families 1930*

Weighted average income

Rental

Income*1

1930

1934"

Group 1 Under J10.0 . .

$ 7.50 12.50 17.50 25.00

340.00

$ 62.50 87.50 125.00 175.00 225.00

$ 90 150 210 300

f 480

$ 750 1 050 1 500 2 100 2 700

$ 360 600 840 1 200

$1 920

$ 3 000 4 200 6 000 8 400 10 800

4 144 12 375 18 897 36 597 72 013

64 537

38 813 15 777 11 642 3 600 2 582 72 414

$"954 $1 920

$4 290

$"»\4 $1 638

$3' 659

$10-14.9

315-19.9

J20-29.9 . . .

Total and average . .

Group 2 $30-49.9

Group 3

$50-74 9 .

$75-99 .9

£100-149.9

J150-199 9

$200 and over

Total and average . .

or footnotes giving sources of data, see page 181, Appendix.

DISTRICT

NUMBER

5

12

14

2

19

17

16

3

7

15 6 4

to

1

6 9 13 11 24 16 23 21 20 22 26 25

ANNUAL INCOME PER FAMILY IN DOLLARS

600 1200 1600 2400 3000

$3,255

3,000

2,918

2,815

2,779

2.582

2,568

2.452

2,384

2,338

2.320

2,302

2,184

2,075

,970

.883

.715

,696

.631

,492

,396

1,307

1.267

1.148

1.136

999

FIG. 6. FAMILY INCOMES IN THE DIFFERENT CENSUS DISTRICTS OF ST. Louis, 1934

The income in the district with the lowest average was less than one-third as large as the income in the two districts with the highest averages.

19351

ST. Louis MILK PROBLEMS

101

The effect of low incomes on milk consumption in St. Louis is shown in summarized form in Table 3. In those districts in which family incomes averaged less than $1,600 a year, daily milk consump- tion averaged 1/3 (.33) pint per person; whereas in districts in which incomes averaged $2,400 a year or more, milk consumption averaged more than i/i (.52) pint per person daily.

TABLE 3. PER-CAPITA CONSUMPTION OF MILK BY INCOME-GROUPS, ST. Louis, 1934

Income per year*

Number of districts

Weighted average annual income

Daily per capita consumption of milk*

Pint

Percent 01 average

Under $1600. . .

7 S 6

8

$\ 279 1 729 2 276 2 805

$2 022

.333 .359 .449 .520

.423

79 85 106 123

100

J1600-J1999

J2000-J2399

£2400 and over

Average for city

•See Table 20. page 163. Appendix.

The relationship between incomes and milk consumption, district by district, is shown graphically in Fig. 7. In District 23, where the aver- age annual income in 1934 was $1,396, the average daily milk consump- tion was about one-third (.36) pint per person; whereas in Districts 14 and 16, where family incomes averaged $2,918 and $2,568 respec- tively, the daily per-capita consumption was .56 pint per person.

Thus milk consumption is shown to be very directly influenced by amount of family income.

Other Foods Relatively Cheaper Than Whole Milk

The retail price of a quart of whole milk delivered to consumers, declined from 13 cents in November, 1930, to 10 cents in March, 1932, and then advanced to 11 cents in December, 1933, at which figure it has remained until the present time (January, 1935) (Table 4).

Measured by the relationship existing between retail prices of fluid milk during the five years 1925-1929 and the prices of 42 commonly used foods, the prices for milk during 1930-1934 were high, the index price of "all foods"1 declining about 30 percent2 whereas if the retail

'In this bulletin the average retail price of "42 foods" is used synonymously with the average retail price of "all foods."

JIt might be added that even during the base period, 1925-1929, prices of all foods changed but little and milk prices remained unchanged.

102

BULLETIN No. 412

[April,

500 1000 1500 2000 2500

AVERAGE INCOME PER FAMILY IN DOLLARS

3000 3500

FIG. 7. MILK CONSUMPTION PER PERSON AND AVERAGE FAMILY INCOME IN THE VARIOUS CENSUS DISTRICTS OF ST. Louis, 1934

The numbers in the body of the chart indicate Census districts. In the districts where family incomes are low, at the left of the graph, less milk is consumed than in the districts where family incomes are high. As incomes increase, milk consumption increases. Districts consisting of more than 35 percent Negro population are not included above because much less milk is used by Negroes than whites even when on the same income-level.

TABLE 4. CHANGES IN RETAIL DELIVERED PRICE OF MILK IN ST. Louis, 1925-1934"

Time

Cents per quart

Price index (1925-27 = 100)

January, 1925, to November, 1930

13

100.0

December, 1930, to August, 1931

12

92.3

September, 1931, to February, 1932

11

84.6

March, 1932, to November, 1933

10

76.9

December, 1933, to January, 1935

11

84.6

•From U. S. Department of Agriculture Yearbooks and U. S. Bureau of Agricultural Economics fluid-milk reports.

price of milk had declined similarly it would have been 2 cents a quart lower in 1933 and 1934 than it actually was3 (Fig. 8).

*In the winter of 1932 and up to June, 1933, distributors offered for sale a low-test milk at prices 2 cents a quart under the usual retail milk prices in order to compete with the substandard milk offered by peddlers. About 20 per- cent of Class I milk during this period was sold at these prices. Thus while the sale of this substandard milk had some effect upon the total sales of milk, it was of no great significance to the market as a whole because of the short period during which it was sold and the relatively small volume that was sold.

J9J5]

ST. Louis MILK PROBLEMS

103

This discrepancy between the retail price of milk and of competing foods at a time when consumers' incomes were very low was another basic factor causing low consumption of milk in this city.

i- z eo

70

RETAIL MILK PRICE IF KEPT IN LINE WITH PRICES OF ALL FOODS

1925 1926 1927 1928 1929 1930 1931 1932 1933 1934

FIG. 8. CHANGES IN RETAIL PRICES OF MILK AND OF "ALL FOODS" IN ST. Louis, BY MONTHS, 1925-1934

Since 1930 the retail price of milk in St. Louis has been high in relation to prices of other foods. If it had changed in the same proportion as the average retail price of "all foods" (42 commonly used foods) it would have been 2 cents a quart lower in 1933 and the early part of 1934 than it was.

The relative position of fresh-milk prices during the first eight months of 1934 in relation to the prices of 15 other commonly used foods is shown in Fig. 9. The retail price of fluid milk stood next to the highest in this list of foods, compared with the prices of the same foods in 1925-1927. Foods that stood at prices relatively higher than the average of "all foods" were, in the order named, canned peas, fresh milk, round steak, canned tomatoes, bread, cabbage, sugar, and pork chops. Foods that stood at relatively lower prices were evapo- rated milk, orariges, corn, eggs, potatoes, butter, coffee, and oleo- margarine.

A general rise in prices of foods in the late summer of 1934, with- out a corresponding increase occurring in the retail price of milk, has

104

BULLETIN No. 412

{.April,

somewhat narrowed the discrepancy between milk and other foods, milk dropping to fifth place on the list.

Evaporated Milk an Effective Competitor

Evaporated milk, one of the principal direct competitors of whole milk, has held a relative price advantage at St. Louis during recent years. Compared with the average prices of these commodities in 1925-

FOODS

8-MONTH AVERAGE JAN.- AUG. 1934

FOODS

PCAS

FRESH MILK

OOUWSTEAK

TOMATOES

BREAD

CABBAGE

SUGAR

PORK CHOPS

AVERAGE 42 FOODS EVAP MILK

ORANGES

CORN

EGGS

POTATOES

BUTTER

COFFEE

OLIO.

PEAS

PORK CHOPS

BREAD

ROUNDSTEAK

FRESH MILK

TOMATOES

ORANGES

SUGAR

CABBAGE

EGGS

AVERAGE

42 FOODS

CORN

EVAP MILK

POTATOES

BUTTER

COFFEE

OLEO

FIG. 9. RETAIL PRICE INDEXES OF SIXTEEN COMMONLY USED FOODS, in St. Louis, JANUARY TO AUGUST, 1934, AND AUGUST 28, 1934

Out of a series of 16 foods in common use, milk during the eight months January to August, 1934, held closer to 1925-1927 price-levels than any of the others, with the exception of one. When consumer incomes are greatly reduced, consumers will naturally buy the foods whose prices have declined most.

1927, the retail price of evaporated milk at this center from 1931 to 1934 averaged only 80 percent as high as the retail price of whole milk (Fig. 10).

Stated in another way, the retail price of a quart of whole milk in 1927 was 3 cents higher than the retail price of a 14i/£-ounce can of evaporated milk.1 By 1932 this difference had increased to 4 cents and in 1934 to 4i/2 cents (Fig. 11 ).

While no data are available showing the consumption of evaporated milk in St. Louis, if the same tendency has existed there as has existed

'Prices of evaporated milk were formerly quoted on the basis of a 16- ounce can. January, 1925, to December, 1931, prices for a 16-ounce can were converted to 14i/2-ounce units by multiplying by .90625.

1935}

ST. Louis MILK PROBLEMS

105

1923 1920 1927 1928 1929 1930 1931 1932 1933 1934

FIG. 10. CHANGES IN AVERAGE RETAIL PRICES OF WHOLE AND EVAPORATED MILK IN ST. Louis, BY MONTHS, 1925-1934

From 1931 to 1934 the retail price of whole milk in St. Louis was high com- pared with the retail price of evaporated milk.

FIG. 11. AMOUNTS BY WHICH THE RETAIL QUART PRICE OF WHOLE MILK

EXCEEDED THE AVERAGE RETAIL PRICE OF A 14i/$-OuNCE CAN OF

EVAPORATED MILK, IN ST. Louis, BY MONTHS, 1925-1934

In 1927 the retail price of a quart of whole milk averaged 3 cents higher than the retail price of a 14y$-ounce can of evaporated milk. During the greater part of 1934 the price of a quart of whole milk was 4Vi cents or more above the price of evaporated milk. (The price of a 16-ounce can of evaporated milk, commonly sold until December, 1931, was converted to the equivalent of a 14 y$- ounce can by multiplying it by .90625.)

in 15 other cities, the wide price differential that has prevailed between evaporated milk and retail quarts of whole milk has led to a marked

106

BULLETIN No. 412

{.April,

increase in the consumption of evaporated milk and has been one of the causes of low whole-milk consumption in this city.

The relation between the per-capita consumption of evaporated milk in 15 cities of the United States and the differential between whole-milk prices and evaporated-milk prices is shown in Table 5 and Fig. 12. It will be noted from the table that in Minneapolis, where

TABLE 5. EVAPORATED MILK CONSUMPTION IN 15 CITIES IN MAY, 1934, AND AMOUNT BY WHICH THE PRICE OF FLUID MILK EXCEEDED THE PRICE

OF EVAPORATED MILK FROM JUNE, 1932, TO MAY, 1934

(Data on consumption obtained by Consumers' Council of the Agricultural Adjust- ment Administration")

City

Per-capita consumption of evaporated milk May, 1934

Amount by which retail quart price of fluid milk exceeded price per can of evaporated milk, June, 1932— May. 1934

Minneapolis

Ibs. 10.2

cents .72

Providence

12.0

5.79

Washington, D. C

14.2

6.25

Cincinnati

14.8

3.65

Chicago ,

15.2

3.30

Philadelphia

16.1

3.30

Pittsburgh

16.1

3.70

17.5

4.25

Kansas City, Missouri

18.4

3.13

Atlanta

19.1

4.99

19.2

4.38

Los Angeles

20.1

4.67

Portland, Oregon

21.0

3.72

San Francisco

23.2

5.62

Seattle

24.0

3.58

•The per-capita consumption of evaporated milk for 59 cities in the United States was ascertained by a survey made by the Consumers' Council of the Agricultural Adjustment Administration in May, 1934. In compiling the above table, 30 of the 59 cities for which the U. S. Bureau of Labor Statistics published no retail price data for evaporated milk were excluded. There were also excluded those cities which from June to August had an average temperature of 77° F. or over for thirty years or more, as well as those which in 1930 had populations of 250,000 or less.

there was a price differential of less than one (.72) cent, the annual per-capita consumption of evaporated milk was only 10.2 pounds. At San Francisco, where there was a price differential of 5.62 cents, the annual per-capita consumption was 23.2 pounds. While the data given here do not show an absolutely consistent relationship between price differentials and the consumption of these two forms of milk other factors evidently being active when the per-capita consumption of evaporated milk in all these 15 cities is plotted on the same chart as the price differentials (Fig. 12) it becomes evident that the per-capita con- sumption of evaporated milk tends to increase when the retail price of whole milk is high in relation to the price of evaporated milk.

1935]

ST. Louis MILK PROBLEMS

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01234567 DIFFERENTIAL- CENTS PER QUART

FIG. 12. EVAPORATED MILK CONSUMPTION TENDS TO INCREASE AS THE PRICE DIFFERENTIAL BETWEEN FLUID MILK AND EVAPORATED MILK INCREASES

If the same tendency has existed in St. Louis as has existed in the above cities, the difference that has prevailed between the retail price of a quart of fluid milk and of an equivalent amount of evaporated milk has been one of the causes of low fluid-milk consumption in this city.

Incidentally evaporated milk is a more forceful competitor of whole milk in St. Louis than in Chicago because the retail price of evapo- rated milk is usually relatively lower in St. Louis than in Chicago (Fig. 13). The price differential in St. Louis in 1932 was .8 cent per can less than at Chicago, and in 1933 it was .6 cent less.

Hot Summers and Lack of Refrigeration Discourage Use of Fresh Milk

High average temperatures, combined with lack of refrigeration by about 40 percent of the families in the St. Louis milk sales area, constitute another basic factor in the low consumption of fluid milk in this area.

Of the 14 largest cities in the United States, St. Louis has the highest average summer temperature. For the sixty- four years from 1870 to 1933 the temperature at this point during June, July, and August averaged 77.2 Fahrenheit (Fig. 14). This was about 7 degrees higher than at Chicago and more than 18 degrees higher than at San Francisco.

108

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1925 1926 1927 1928 1929 1930 1931 1932 1933 1934

FIG. 13. AVERAGE RETAIL PRICE OF 14Vi-Ounce Can of Evaporated MILK IN CHICAGO AND ST. Louis, by MONTHS, 1925-1934

The retail price of evaporated milk at St. Louis has usually been lower than at Chicago. That is why evaporated milk is a more forceful competitor of whole milk in St. Louis than it is in Chicago.

14 LARGER CITIES

JUNE -AUGUST TEMPERATURE (*F) 60-YEAR AVERAGE 0 10 20 3O 40 50 60 70 80

ST. LOUIS BALTIMORE PHILADELPHIA PITTSBURC(1) NEW YORK CHICAGO DETROIT

MINNEAPOLIS -ST. PAUL CLEVELAND

BOSTON LOSAHGELES

MILWAUKEE BUFFALO SAN FRANCISCO

•F 77.2

75.2

MJ 72.7

71.9 70.5 70.0

70.0 69.6 69/4 69.2 67.6 67.6 56.7 1

FIG. 14. AVERAGE TEMPERATURES OF 14 CITIES IN THE UNITED STATES IN JUNE, JULY, AND AUGUST, 1874-1933

The summer temperature at St. Louis has been the highest of the 14 largest cities in the United States. For the sixty years from 1874 to 1933 it averaged 77.2° F. This was nearly 7 degrees higher than the temperature at Chicago and more than 18 degrees higher than at San Francisco.

Because of these excessively high summer temperatures, refrigera- tion is necessary if milk is to be kept sweet. The fact that so many families in St. Louis and St. Louis county have no refrigeration (Table

1935}

ST. Louis MILK PROBLEMS

109

6) is probably the most important reason why almost a third (31.3 percent) of the families included in this survey stated that they did not buy fresh milk daily (Fig. 15).

TABLE 6.-

REFRIGERATING FACILITIES OF FAMILIES IN ST. Louis AND ST. Louis COUNTY, 1934, AND IN THE UNITED STATES, 1933"

St. Louis and St. Louis county, 1934

United States. 1933

Total number of families in area

266 960

29 904 663

Families using ice refrigeration

60 000

101 000

Total families using refrigeration

161 000

IS 000 000

Families having no refrigeration

105 960

14 904 663

Percentage of families having no refrigeration

39.7

49.8

•Sources of data are given on page 181, Appendix.

FAMILIES HAVING NO 39.7 REFRIGERATION

FAMILIES

NOT GETTING ,, ,

FRESH MILK 31-3

REGULARLY

10 20 30

PERCENT OF TOTAL

4O

FIG. 15. PROPORTIONS OF FAMILIES IN ST. Louis THAT HAD No REFRIGERATION AND USED No MILK REGULARLY IN 1934

The fact that nearly 40 percent of the families in St. Louis have no re- frigeration partially explains why about a third of them do not buy fresh milk regularly. Extremely high summer temperatures make refrigeration a necessity in keeping milk sweet.

Nationality Not a Major Cause of Low Milk Consumption in St. Louis

Whether the low per-capita consumption of milk in St. Louis is caused, to any important extent, by the origin of the St. Louis people with respect to race or nationality, can be determined fairly accurately on the basis of a study made in Boston in 1930. The amount of milk which would have been used in St. Louis had the various racial and national groups there used as much milk as the same groups did in Boston is shown in Table 7. On the Boston basis, St. Louis consump-

no

BULLETIN No. 412

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tion would have been .74 pint daily per person in 1934 nearly twice the actual consumption and only 31/i percent less than the per-capita consumption in Boston. Since three-fourths of the St. Louis people are in the high-consumption nationality groups and only one- fourth

TABLE 7. THEORETICAL CONSUMPTION OF MILK IN ST. Louis IN 1934 IF THE

VARIOUS NATIONALITIES IN ST. Louis HAD CONSUMED THE

SAME AMOUNTS OF MILK AS THOSE IN BOSTON

Nationality

Number of individuals in St. Louis*

Daily per- capita con- sumption in Boston1"

Theoretical daily con- sumption of milk in St. Louis

Total

Per capita

Irish

31 873 131 873 438 592 14 663 4 466 82 096 23 817 93 580 821 960

pint .848 .825 .800° .771 .720 .716 .488 .387 .767

pints 27 028 108 795 350 874 11 305 3 216 58 731 11 623 36 215 607 837

pint 740

German

Native white

English, Scotch, and Welsh

Canadian

Miscellaneous

Negro

All

»U. S. Census, 1930.

bBased on a report prepared by F. V. Waugh and published by the Mass. Agr. Exp. Sta., Sept., 1931, entitled "The Consumption of Milk and Dairy Products in Metropolitan Boston in December, 1930." Figures in Table 5, p. 6, of that report are here corrected to correspond with the daily per-capita consumption of milk at Boston in May, 1934 (see Table 1 herewith).

"The majority of native whites in St. Louis are of German descent. Since in Boston the daily per-capita consumption of milk by the German people was found to be higher than that of native whites, the per-capita consumption figure shown here for native whites in St. Louis appears reasonable.

in the low-consumption groups, it is evident that the national or racial origin of the St. Louis people is not a major factor in the low per- capita consumption in that city.

HOW ST. LOUIS MILK SALES MIGHT BE INCREASED Greater Per-Capita Consumption

Until recently a fairly rapid increase in the population of the United States has made possible an expansion of markets for milk and other dairy products without any increase in per-capita consumption. In late years, however, the rate of population increase in the United States has been declining, and it is not unlikely that within the next thirty years population will become stationary.1

'From 1790 to 1880 population in the United States increased at the rate of 3.1 percent annually. During the next thirty years the average annual in- crease was 2.2 percent. From 1910 to 1930 the rate declined to 1.6 percent annually. During the latter part of the decade 1920 to 1930 the U. S. Census

1935] ST. Louis MILK PROBLEMS 111

vThe population in the St. Louis milk-sales area increased approxi- mately 20 percent between 1920 and 1930, advancing from 1,061,000 to 1,276,000 people. This was an average annual increase of 2 percent. The present rate of increase in the United States as a whole is less than 1 (.9) percent annually. Assuming the same rate of increase in St. Louis as in the United States as a whole, St. Louis would add to its population yearly about ten thousand people.

As previously stated by the writer, "The fact that population is increasing at a declining rate intensifies the problem of bringing about any marked increase in total sales of market milk. Problems of local milk distribution increase when the rate of increase in population de- clines, since it is less easy for either old or new distributors to find expanding outlets for their products."1

Considering the foregoing facts, the chief opportunities for pro- ducers and dealers in the St. Louis dairy district to increase milk sales would seem to lie, not in serving a new or increasing population, but rather in stimulating a larger consumption of milk per capita among those now living in this sales area. An increase of less than one- hundredth pint per person daily would be equivalent, in its effect on the milk industry, to a 2-percent annual increase in population.

Adoption of Lower Prices for Store Milk

It has been shown (pages 99 to 109) that the low per-capita con- sumption of milk at St. Louis is attributable to two principal causes: (1) low incomes of consumers, combined with relatively high prices of milk compared with prices of competing foods; and (2) the ex- treme heat at St. Louis during the summer, combined with lack of refrigeration facilities in the homes of a large number of families in this area.

How to remove these factors that depress milk consumption is sug- gested by an analysis of store milk prices and sales in St. Louis and their comparison with prices and sales in other large cities, especially in Boston, where the per-capita consumption, as already shown, is the highest of any of the 14 largest cities in the United States.

In New York and Boston, where store sales have constituted an important part of the total sales of milk for a longer period than in any of the other large cities, per-capita sales have been higher than

'111. Agr. Exp. Sta. Bui. 397, p. 427.

Bureau estimated the average increase at .71 percent annually. While authori- ties do not agree on the exact time, they are in general agreement that a station- ary population will be reached within twenty-five to forty years.

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BULLETIN No. 412

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in any other large market in the country (except Minneapolis-St.Paul1) for which sales data are available. The daily consumption of milk in New York from 1929 to 1932 was .778 pint per person, while at Boston from 1930 to 1932 it averaged .849 pint per person.2 In May, 1934, these two cities still ranked among the leading cities in per-capita sales of milk (Table 1).

The difference between store prices and prices of retail delivered milk in Boston from 1922 to 1925 usually exceeded 2^2 cents a quart (Fig. 16), altho at times the cutting of the retail delivered price nar- rowed this to only one cent. In New York during the same period, the difference between the store price and the price of delivered milk was even wider than at Boston, because of the sale of bulk milk per- mitted in New York during this period.3

1932

'30 '31

•32 1933

FIG. 16. DIFFERENCE BETWEEN RETAIL WAGON PRICES OF MILK AND STORE PRICES IN BOSTON, BY MONTHS, 1922-1933

In 1922 stores in Boston sold milk at an average of 3yi cents a quart below the wagon price. After ten years of competition between these two methods of sale, store prices, for the greater part of 1933, were still 2 cents a quart below wagon prices.

'The high per-capita sales at Minneapolis-St. Paul can be attributed princi- pally to the low retail price of delivered milk prevailing there. From 1929 to 1934 the. average retail prices of delivered milk there were the lowest of the 14 largest cities.

•111. Agr. Exp. Sta. Bui. 397, p. 445.

'Same, pp. 445-448.

19351 ST. Louis MILK PROBLEMS 113

Thus carefully compiled evidence indicates that milk sold in stores at prices below wagon prices tends to result in a greater per-capita consumption.

The next question concerns the margin on which dealers can afford to sell milk to stores. Again we may look to Boston for information.

In Boston in 1934 wholesale milk prices quoted to stores averaged 9.0 cents a quart. This price represented 6.6 cents paid to producers and a gross margin for distributors of 2.4 cents to pay the costs of as- sembling, pasteurizing, bottling, and delivering to the stores. In St. Louis in 1934, altho the wholesale price of milk per quart quoted to stores averaged 8.9 cents, producers received only 4.5 cents a quart.1 Thus the distributors' gross handling margin in St. Louis averaged 4.4 cents, or 2 cents more than in Boston during the same period.

The store price of milk to consumers in St. Louis during the past year (1934) has been quoted each month at 10 or 11 cents a quart. If St. Louis distributors had operated on the same margin as Boston distributors, St. Louis consumers willing to buy milk at stores could have bought it at 2 cents a quart less than they did. A 2-cent reduction in the price of milk sold thru stores, if widely advertised, would doubt- less have been reflected in a markedly increased volume of sales, for it would have opened up a better market among families with low incomes (who are in general the same families that lack refrigeration and who would therefore be interested in utilizing store facilities by buying milk closer to the time of its use), and it would have en- couraged families with medium-sized incomes to increase their daily purchases of milk.

Enlargement of Educational Program

The second recommendation for promoting sales of milk in the St. Louis sales area that of an enlarged educational program may be divided into two parts: an intensive current program, and a long- time program.

The current program should include the placing of educational material before St. Louis consumers in such a way as to popularize the use of milk in locations where the greatest increases in consump- tion can be obtained at the lowest cost. The types of displays or presentations will vary with different localities, and in their initial stages will necessarily be experimental. Consequently results from this type of program should be measured frequently.

lAs calculated from the monthly fluid-milk reports of the Bureau of Agri- cultural Economics, U. S. Department of Agriculture.

114 BULLETIN No. 412 {.April,

The long-time program should incorporate the plans at present sponsored by the Dairy Commission of St. Louis (formerly Dairy Council). This program has already been established on a working basis and could well be expanded to cover the entire St. Louis sales area.

Improved business conditions, in themselves, can hardly be de- pended upon to increase milk consumption in the St. Louis area, for even in the fairly prosperous year of 1930 more than two-thirds of the families in this area had average incomes of only $117 a month. The need obviously is to establish prices for milk that will bring this com- modity within the reach of the mass of consumers, who have and probably will continue to have low incomes.

Districts Most Favorable for Store Sales

Successful distribution of milk thru stores is dependent usually upon the following factors:

1. A high concentration of people within a restricted area.

2. Average family incomes higher than the subsistence level but lower than the luxury level.

3. A population of nationality or racial origin accustomed to a fairly extensive use of milk.

Assuming that store sales are to be encouraged in St. Louis, the next question is in what districts attempts to increase such sales would probably prove most successful.

Other things being equal, promotion of store sales is likely to be most successful in areas having a population of 20,000 or more people per square mile. The first thirteen districts shown in Fig. 17 meet this requirement: Nos. 6, 10, 11, 12, 16, 17, 19-24, and 26.

Of the above districts, Nos. 20, 21, 22, 23, and 26 would be ex- cluded from consideration because of the large number of families with incomes below the subsistence level (Fig. 6, page 100). In these districts the average income was less than $1,500 a year; which means that the majority of the families had incomes much lower than $1,500. District 11 would be excluded because of the high proportion of Negroes, who have been shown by several studies to consume less milk than whites even when on the same income-level. Districts 18, 21, 22, and 25 would also be excluded for the same reason were they not already excluded because of low incomes or low population density, all these districts having less than 80 percent white population.

This leaves Districts 6, 10. 12, 16, 17, 19, and 24 as those in which

1935]

ST. Louis MILK PROBLEMS

115

store sales of milk could, theoretically at least, be most successfully promoted. Among these districts the one having the largest number of families in the middle-income group is No. 6, followed by 10, 16, 17, 24, 19, and 12 in the order named. This item is of interest since it is

THOUSANDS OF PEOPLE PER SQUARE MILE

0 5 10 15 20 25

FIG. 17. DENSITY OF POPULATION IN THE VARIOUS ST. Louis CENSUS DISTRICTS, 1930

A relatively dense population is needed for the successful promotion of retail milk sales thru stores. The first 13 districts shown above have more than 20,000 people per square mile. Six of these districts would be excluded from consideration, however, either because of low incomes or because of the high proportion of Negroes, who are not so favorable to the use of milk as whites. The seven districts that are starred are the ones most susceptible to increased milk consumption thru store sales.

among the families in this income-range that the greatest interest seems to be shown in increasing milk consumption and in effecting savings by purchasing milk thru stores.

From another point of view also these districts appear to be favor- able territories for the expansion of store sales of milk. There are few relief cases here in comparison with the average for the city (Fig. 18). In May, 1934, only 6 percent of the families in these districts were on relief, whereas in St. Louis as a whole 16 percent were on relief. This

116

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is another indication that the majority of the families in these dis- tricts have incomes above the subsistence level.

In certain parts of the 19 districts not listed above, it is likely that concentrated efforts to increase milk consumption thru store sales would be as effective as in the selected districts. If special efforts are made in selected acreas to promote sales of milk, the results should be

CITY Of ST. LOUIS Pll»CENT OF ' FAMILIES ON RtUCf

I I LtSS THUH 4.»%OH V/40J FROM ST. TO ».»%ON IILIIF E&'gj FROM KJ%TO £4.9% ON KILIIF YSS1 FROM Z5% TO 4-5 9 -A ON RtL.tr

FIG. 18. MAP OF THE CITY OF ST. Louis SHOWING PROPORTION OF FAMILIES ON RELIEF IN THE VARIOUS CENSUS DISTRICTS, MAY, 1934

In general the districts having the greatest density of population (Fig. 17) and the lowest average annual income (Fig. 6) had the greatest proportion of families on relief. In May, 1934, 75 percent of the families in District 21 were receiving public help. The average number of families on relief in all districts was 16.1 percent.

carefully measured, and if successful, similar measures used to increase sales in other districts.

Companies having stores scattered thruout the city may find it worth while to handle milk at all their stores, regardless of district, when little or no extra equipment is necessary for so doing. This is especially true when newspaper advertising is used for increasing milk consumption. Tho only a small volume may be handled in some stores in the less densely populated areas, the margin of profit should be sufficient to bear its proportionate part of the advertising cost and thereby reduce the company's unit cost for this purpose. The decision as to which stores can handle milk profitably must of course be made by the management of each store or company ; it was for the purpose of presenting the possibilities more clearly and of facilitating such de- cisions that this survey was made.

J955]

ST. Louis MILK PROBLEMS

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WHY PRICES TO PRODUCERS DECLINED FROM 1929 TO 1933

Dairymen in the St. Louis dairy district experienced rapidly de- clining milk prices from 1929 to the early part of 1933. Many of these dairymen have asked why this decline occurred. Primarily it was a part of the general decline in price-levels (including the price of farm feeds) and in consumers' incomes. A secondary factor was the greater volume of milk that resulted from an increase in the number of dairy cows in this area and in the country at large.

Downward Trend of General Price-Level

The close correlation between changes in the general price-level, the wholesale prices of farm foods, and the St. Louis fluid-milk prices during recent years is shown graphically in Figs. 19 and 20.

60

1924 1925 1926 1927 1928 1929 1930 1931 1932 1933 1934

FIG. 19. CHANGES IN WHOLESALE PRICES OF ALL COMMODITIES IN THE UNITED STATES AND IN OTHER COUNTRIES, 1924 TO 1934

The decline in the general price-level in 1929-1933 was world wide. Since early in 1933 the general price trend has been upward. It is reasonable to expect a continuation of this general upward movement in the United States until the forces of recovery now in operation have worked out their influence.

The rapid decline in the general price-level from 1929 to 1933 brought the price average of 784 commodities in the United States in February, 1933, to less than two-thirds of the 1929 average. This decline was world-wide, conditions in the United States correspond- ing very closely to those in England, Canada, Germany, France, Italy, Netherlands, Japan, and China countries that take about 75 percent of the agricultural exports from the United States.

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BULLETIN No. 412

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Food prices, as is always true, tended to follow closely the changes in the general price-level. And St. Louis fluid-milk prices to pro- ducers followed closely the prices of farm foods in general, altho re- maining most of the time at a little higher level. It is always true that food prices tend to change as a group, tho prices of particular foods frequently do not change at the same rate as the group.

FIG. 20. INDEX OF PRICES OF FARM FOODS IN THE UNITED STATES, AND A TWELVE-MONTHS' MOVING AVERAGE OF ST. Louis FLUID- MILK WHOLESALE PRICES, 1910 TO 1934

When the general price-level declines or rises, food prices tend to follow these changes closely. Also, prices of different foods tend to change at the same time tho frequently they do not change at the same rate. A close cor- respondence between prices of farm foods in the United States and St. Louis fluid-milk prices is shown in this chart.

The outlook now seems to be for a general upward movement of prices in the United States during the next few years. The general level has risen considerably since the low point in July, 1932, having (in December, 1934) advanced 29 percent since that time. St. Louis milk prices were 89 percent higher in December, 1934, than in Decem- ber, 1932, and they have advanced considerably faster than prices of farm foods in general, tho in the late summer and fall months of 1934 milk prices were only slightly higher than those for farm foods in general.

Lower Prices for Feeds

Cheap feeds encourage heavy milk production. When feed is cheap in relation to milk, farmers feed their cows more liberally and they feed more cows if they can buy them at reasonable prices. Both these practices tend to produce an oversupply of milk, and consequently milk prices decline. When milk prices become too low in relation to feed

1935}

ST. Louis MILK PROBLEMS

119

prices, farmers feed less grain, production drops, and prices after a time rise.

In the St. Louis dairy district during the ten years 1925 to 1934, 100 pounds of milk would purchase an average of 158 pounds of a standard dairy ration (Fig. 21). In 1932, when feed was exceedingly cheap, 100 pounds of milk would buy 198 pounds of the ration. As a result of advancing feed prices, 100 pounds of milk in 1934 would

FIG. 21. AMOUNT OF A ST. Louis DAIRY RATION THAT 100 POUNDS OF MILK IN THE ST. Louis MILKSHED WOULD BUY YEARLY, 1925-1934

In 1932, when feed was cheap, 100 pounds of milk in the St. Louis milkshed would buy 198 pounds of the dairy ration. In 1934 this amount of milk would buy only 120 pounds of the ration, or about four-fifths as much as for the above ten-year average. Low-priced feeds encourage heavy milk production, whereas high-priced feeds discourage it.

buy only 120 pounds of this ration, or about four-fifths as much as during the ten-year average. Monthly variations in the feed-purchasing power of milk during 1925-1934 are shown in Fig. 22. It will be noted that in September, 1934, 100 pounds of milk would buy only 111 pounds of the dairy ration or less than three- fourths of the ten-year average amount. The high hay and feed prices during the present winter (1934-35) are the result of the very low production of hay and feeds during the summer of 1934. These higher feed prices can be expected to result in a lower production of milk in the early part of 1935.

Changes in the farm prices of several products important in the St. Louis dairy district are shown in Table 8.

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BULLETIN No. 412

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90

1925 1926 1927 1928 1929 1930 1931 1932 1933 1934

FIG. 22. AMOUNT OF A ST. Louis DAIRY RATION THAT 100 POUNDS OF MILK WOULD BUY MONTHLY IN THE ST. Louis MILKSHED, 1925-1934

Milk prices have risen much more slowly during the past three years than have feed prices, with the result that the feed-purchasing power of milk has sharply declined. In the latter part of 1934, 100 pounds of milk would buy less feed than at any time since 1928.

TABLE 8. FARM PRICES FOR SELECTED FARM PRODUCTS IN THE ILLINOIS PART OF THE ST. Louis MILKSHED AND FOR A STANDARD DAIRY RATION

Commodity

Average 1925-1929

Average in July, August, September

1932

1934

Percent change

Livestock and poultry products Milk (cwt.)

$1.95 .395 .265 .216

77.04 8.56 11.34 11.87

1.30 .91 .42 2.15 1.44 16.64

$ .88 .157 .123 .103

33.68 5.22 4.27 5.31

.40 .22 .14 .39 .47 7.40

$1.41 .22 .15 .113

31.10 4.87 5.06 4.89

.89

.67 .44 1.14 1.20 15.80

+60.2 +40.1 +22.0 + 9.7

- 7.7 - 6.7 + 18.5 - 7.9

+122.5 +204.5 +214.3 +192.3 +155.3 +113.5

Butterfat (Ib.)

Eggs (doz.)

Chickens (Ib.)

Livestock Milk cows (head)

Beef cattle (cwt.)

Hogs (cwt.)

Veal calves (cwt.)

Grains Wheat (bu.)

Corn (bu.)

Oats (bu.)

Soybeans (bu.)

Dairy ration (cwt.)

Alfalfa hay (ton)

Decline in Consumers' Incomes

About 50 percent of the milk sold by producers in the St. Louis milkshed is manufactured into butter or is utilized in products sold on a butter-value basis; hence their market value is directly proper-

1935J

ST. Louis MILK PROBLEMS

121

tional to the worth of the butter. Since the worth of this milk in turn influences the price of fluid milk1 sold in whole form to retail con- sumers, circumstances that influence the price of butter influence in- directly the price of whole milk.

This relation between butter prices and whole-milk prices is of interest at this point because data are available showing the course of factory payrolls (a good index of consumer incomes) and butter prices over the past few years (Fig. 23). The similar up-and-down

140

1920 1922 1924

1926

1926 1930

1932 1934

FIG. 23. CHANGES IN PRICE OF 92- SCORE BUTTER IN CHICAGO, AND IN

CONSUMERS' INCOMES IN THE UNITED STATES AS MEASURED

BY FACTORY PAYROLLS, 1919 TO 1934

Changes in consumers' incomes have had a strong influence on butter prices, as shown by the similar up-and-down swings of these items from 1919 to 1934. It is reasonable to expect that both factory payrolls and butter prices will move upward thru the next few years.

swings in factory payrolls and butter prices in the United States since 1919 indicate the strong influence that changes in the incomes of con- sumers have had on butter prices. Both the moderate decrease in pay- rolls in 1927, resulting from the business recession, and the severe decline in payrolls during the depression of 1929-1933 were accom- panied by declining butter prices. The substantial increase in consumer incomes during the eigtheen months preceding September, 1934, as measured by factory payrolls, has been accompanied by a correspond- ing increase in butter prices.

'Class I milk ; see definitions on page 146.

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It may be added that the general movement of both factory pay- rolls and butter prices is likely to continue upward during the next few years a prospect that is of vital importance to milk producers in the St. Louis milkshed. This long-time upward swing should not be confused with temporary up-and-down fluctuations.

1873 I860

1890

1900

1910

1920

1930 1934

FIG. 24. CHANGES IN CATTLE PRICES AS INFLUENCED BY CHANGES IN NUMBER OF CATTLE IN THE UNITED STATES, 1873 TO 1934

Cattle prices are characterized by well-defined cycles in which peaks usually occur every fourteen to sixteen years. The above chart shows these peaks oc- curring in 1885, 1899, 1915, and 1930. When numbers of cattle are high, total milk production is high and the purchasing power of cattle low. If history repeats itself, an upward movement in cattle prices may be expected during the next few years as the result of a decline in the number of cattle and in milk production.

79J5]

ST. Louis MILK PROBLEMS

123

Increase in Number of Cattle

Cattle numbers and prices are characterized by well-defined cycles whose peaks usually come fourteen to sixteen years apart (Fig. 24). When numbers of cattle are high, prices of cattle are relatively low, and these low prices induce dairymen to acquire more cows for milk production. Thus a larger volume of milk becomes available for the market, which in turn depresses the price of milk, and producers begin to dispose of their less efficient cows.

An increase in the number of cattle, and consequently in the pro- duction of milk, is one of the economic forces that would have caused relatively lower butter and milk prices from 1931 to 1934 even had there been no general price decline. In January, 1934, the price of cattle compared with the price of other items reached its lowest point in nearly half a century.

Faced with an acute feed shortage in 1934, producers began to liquidate their milk cows in the summer and early fall. This movement is likely to continue; and if history repeats itself, an upward move- ment in cattle prices, accompanied by a decreasing volume of milk and increasing milk prices, may be expected during the next few years.

While the above remarks apply to the situation in the United States as a whole, the situation in the St. Louis milkshed is somewhat differ- ent. The number of heifers that will come into milking in the St. Louis milkshed during the next two years is materially larger pro- portionately than in the country as a whole, or for Illinois as a whole (Table 9) ; and for this reason an abundance of milk is in prospect

TABLE 9. DAIRY CATTLE POPULATION AND PRODUCTION OF MILK IN THE ST. Louis MILKSHED, IN ILLINOIS, AND IN THE UNITED STATES, 1934

St. Louis milkshed*

Illinois1'

United Statesb

Milk sold daily per cow milked, pounds

15.

Milk sold annually per cow, pounds

4 H.I ;

Number of animals per 10 farms Milk cows

73

Dry cows

17

Total cows

90

Two-year old heifers ....

10

Yearling heifers

13

Heifer calves to be raised

12

Total heifers

35

Proportion of yearling and two-year old heifers to total number of cows

25.8%

17.9%

18. 2%

•Information furnished by 5,409 producers in the St. Louis milkshed in June, 1934. Table 32, Appendix, gives data by counties. The questionnaire used for obtaining these statistics is shown on page 182, Appendix. bBased on data mcluded in Table 33. Appendix. 'May, 1934. ''From June, 1933, to May, 1934, all cows.

124

BULLETIN No. 412

[April,

in this area during this period. Relatively high milk production, com- bined with higher butterfat prices, which will be reflected in higher prices for whole milk, should cause substantial increases in the incomes of dairymen in the St. Louis milkshed during the next few years.

Whole-Milk Prices Affected by Condensery Prices

During the past twenty-five years changes in the average net prices received by producers in the 41- to 50-mile zone from St. Louis and selling to the whole-milk market have corresponded closely to changes in condensery prices at Greenville during the same period (Fig. 25).

$4.00

1909'10 '11 '12 '13 '14 '15 '16 '17 '18 '19 '20 '21 '22 '23 '24 '25 '26 '27 '28 '29 '30 31 32 33 1934

FIG. 25. PRICES FOR WHOLE MILK AT ST. Louis COUNTRY PLANTS AND CONDENSERY PRICES AT GREENVILLE, ILLINOIS, 1909 TO 1934

Changes in whole-milk prices paid to producers in the St. Louis milkshed have corresponded closely to changes in condensery prices in this area. From 1930 to 1934 whole-milk prices were somewhat higher than condensery prices. Because of a probable upward movement in consumers' incomes and a lowered milk production, as the result of fewer cows, milk prices to St. Louis producers may be expected to move upward during the next few years.

Furthermore these changes in condensery and whole-milk prices have corresponded closely to changes in the general price-level during the past fifteen years (Fig. 19, page 117).

Judging from relationships existing in the past, producers in the country-plant areas of the St. Louis milkshed may expect to receive for whole milk an average price higher than the condensery price by about the amount that the unit cost of producing milk of the higher quality demanded for fluid sales in even quantities thruout the year, exceeds the costs of producing milk for condensery uses. With the enactment of more stringent quality requirements for whole milk, and the resulting increase in the cost of producing it, it is probable that whole-milk prices in the St. Louis milkshed will continue to exceed materially the condensery prices.

1935] ST. Louis MILK PROBLEMS 125

THE BASIC-SURPLUS PRICE PLAN

During the past few years what is known as the "basic-surplus" price plan for paying producers for milk has spread rapidly within the United States. This plan was adopted by the organized producers in the St. Louis milkshed in October, 1930, and was continued until November 15, 1934, with the exception of five months in 1933, when a flat-price plan was in effect. During the last year in which the basic-surplus plan was in effect November 25, 1933, to November 15, 1934 it was applied to all producers in the milkshed. The plan was abandoned because organized producers, by a two-to-one vote indicated their preference for a weighted average price for milk (see page 147).

Under the basic-surplus plan differences between the average mar- ket value of milk marketed as whole milk (or "basic" milk) and of milk marketed as cream or manufactured products ("surplus" milk) are recognized in determining payments to producers for their milk. In other words, this plan distributes to producers the proceeds from the sale of milk at two or more prices, according to the potential mar- ket value of the milk contributed by each producer.

Advantages in Open-Market Policy Under Plan

The basic-surplus plan may operate under either an open-market policy or a closed-market policy. Under an open-market policy there is no artificial restriction to the quantity of whole milk that each pro- ducer shall be permitted to market during any given year, nor as to how many producers may sell whole milk to a given market.

In contrast to the open-market policy, the closed-market policy re- stricts the volume of milk for which any producer may receive the base, or Class I, price to the volume which he produced in some pre- vious period, or to some practical increase resulting from an increase in sales of milk.

From an economic standpoint the use of a closed base is both unsound and unwise, because, in the first place, it tends to penalize the more efficient to the benefit of the less efficient dairyman, particularly if it be extended over a period of years; and, second, because it is in essence a producer monopoly which is almost certain to be broken down eventually by outside milk coming into the market and disrupt- ing the outlets of those trying to secure a privileged position.

The open-market policy was used in the operation of the basic- surplus plan in the St. Louis milkshed. Under it the volume of basic milk that each producer was entitled to market was subject to change

126

BULLETIN No. 412

\_April,

each year, and new producers, after a short probationary period, were able to sell milk to the market on a parity with the older producers.

Different Kinds of Milk Surpluses

In discussing "surplus" milk the amount of milk produced for market over and above that consumed as whole milk it is well to re- member that such milk may be divided into three distinct categories: seasonal surplus, marginal surplus, and constant surplus (Fig. 26).

150 140

20

JUNE JULY AUG. SEPT. OCT. NOV. DEC. JAN: FEB. MAR. APR. MAY

1933 1934

FIG. 26. VOLUME OF WHOLE-MILK SALES MONTHLY IN THE ST. Louis DAIRY DISTRICT, 1933-1934, AND VOLUME OF DIFFERENT SURPLUSES

Milk surpluses may be thought of as three distinct kinds: (1) seasonal, that is, the amount by which, during given seasons, production exceeds that of the lowest season ; (2) marginal, that is, the amount necessary to insure against daily variations in production and consumption ; and (3) constant, that is, the difference between the seasonal surplus and the marginal surplus, a rather constant amount that would be available for fluid sales were there a demand for it.

The seasonal surplus is the volume of milk produced in some months in excess of that produced in the lowest month of the year. This surplus must necessarily be utilized as cream for buttermaking or converted into other milk products. The marginal surplus is that volume in excess of the average daily consumption of whole milk that

19351

ST. Louis MILK PROBLEMS

127

must be on hand to protect distributors against the wide variation that occurs in day-to-day consumption and production. Distributors carry about 20 percent in excess of their average daily sales of whole milk in order to meet this contingency. The third type of surplus, the constant surplus, is the amount of milk in excess of both the daily demand and the marginal surplus that is available every month of the year. The fact that there is such a surplus would make it possible to increase im- mediately the consumption of whole milk in the St. Louis sales area without drawing upon producers outside the present producing area. A still larger increase would be possible, without recourse to milk from outside the present area, if producers would so alter their pro- duction practices as gradually to redistribute some of the large sur- pluses now occurring in April, May, and June, to July, August, Septem- ber, and October, the months of low production. For seasonal varia- tions among two groups of producers, see Fig. 27.

200

160

2120

80

40

130

120

PRODUCERS WHOSE BASE VOLUME WAS LESS THAN 10 PERCENT OF THEIR MAY VOLUME

JUNE JULY AU6. SEPT. OCT. NOV. DEC. JAN. FEB. MAR. APR. MAY

PRODUCERS WHOSE BASE VOLUME WAS 50-59 PERCENT OF THEIR MAY VOLUME

JUNE JULY AUe. SEPT. OCT. NOV. DEC. JAN. FES. MAR. APR MAY

1933 1934

FIG. 27. MONTHLY VARIATION IN PRODUCTION OF FARMERS WHOSE BASE

VOLUMES WERE DIFFERENT PROPORTIONS OF THEIR MAY VOLUMES:

JUNE, 1933, TO MAY, 1934

The seasonal surplus of certain groups of producers is very small compared with other groups of producers.

128

BULLETIN No. 412

[April,

Production More Even Under Basic-Surplus Plan

The influence of the basic-surplus plan in encouraging dairymen to produce more even volumes of milk thruout the different months of the year has been demonstrated in the St. Louis milkshed.

As already stated, part of the producers in this area were paid on the basic-surplus plan from October, 1930, to June, 1933. The seasonal variation of these producers in 1932, when the basic-surplus plan had been in operation more than a year, is shown by the heavy solid line in Fig. 28. Contrasting with this heavy line is a broken line showing

PRODUCERS

123 \ (AVERA6C I913-I9ZS)

JAN FEB. MAR. APR. MAY JUNE JULY AUG. SEPT. OCT. NOV. DEC

FIG. 28. MONTHLY PRODUCTION IN 1932 OF PRODUCERS PAID ON THE BASIC- SURPLUS PLAN, COMPARED WITH THAT OF ALL PRODUCERS IN THE ST. Louis MILKSHED FROM 1922 TO 1925

The range in seasonal production of those dairymen in the St. Louis milk- shed who in 1932 had been paid on the basic-surplus plan for over a year was less than half that of all producers in this milkshed from 1922 to 1925. In other words, the basic-surplus plan tended to encourage more even production.

the seasonal variation in the production of all dairymen in the St. Louis milkshed during an earlier period (1922-1925) when the flat-price system was in operation. A very marked change toward a more even production of milk during the different months of the year is evident under the basic-surplus plan.

One reason for striving toward a more even production of milk for the fluid market is that the demand for fluid milk is relatively even thruout the year. Thus during the twelve months from June, 1933, thru May, 1934, sales of fluid milk in the St. Louis area were about the same every month (Fig. 29). In September, the high sales month, they were only 7 percent higher than in January, the low month.

1935}

ST. Louis MILK PROBLEMS

129

Production of milk, on the other hand was 73 percent higher in May, the high production month, than in September, the low month. Thus production varied about ten times as greatly from month to month as did the consumption of milk. Such wide differences between con- sumption and production are costly for all concerned in the fluid-milk business.

PRODUCTION IN MAY

TOTAL PRODUCTION

1

THE HIGH MONTH, WAS 73% HIGHER

(LOW MONTH- lOO]

•iQ-

THAN IN SEPTEMBER,"

3^

THE LOW MONTH

"«T1

7^

PS

S*V

fy

^35

^

•WJ

100

t-

1

*<«

PERCEN

9 o

1

* -...',

"''.'

i -,-.-;

••.v;

,v -^

1

1

L>_,.,

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1

1

";.'';:!

||

§

••V'1

•£vi

.v

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•'. '; '' 7

20

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117 lot toe too 100 no ne 124 us izo 137 173

JUNE JULY AUG. SEPT. OCT. NOV. DEC. JAN. FEB. MAR. APR. MAY

100

H Z

LJ

1

i

s

AL

1

ES OFCLA

CiOJf MONTH

asa—

ss

/fl

I

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MILK SALES IN SEPTEMBER , ^ THE HIGH MONTH, (WERE 7% HIGHER THAN IN

YJAN- THUS^MONTHwn

1

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060 cc.

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104 103 102 107 104 103 100 100 102 103 102 106

JUNE JULY AUG. SEPT. OCT. NOV. DEC. JAN. FEB. MAR. APR. MAY

IOT.*\ -" io*^ji

FIG. 29. MONTHLY VARIATIONS IN TOTAL MILK PRODUCTION AND IN

TOTAL SALES OF CLASS I MILK IN THE ST. Louis

DAIRY DISTRICT, 1933-34

The total production of milk in May, the high month, was 73 percent greater than in September, the low month. On the other hand, the sales of Class I milk in September, the high month, were only 7 percent greater than in January, the low month. Thus the seasonal fluctuation in production was more than ten times as great as the seasonal fluctuation in the volume of Class I milk sales.

It is interesting to note that the wide seasonal variation in pro- duction just mentioned was caused, in large part, by dairymen who were on the market nine months or less during this period (Fig. 30). The majority of these "in-and-outers," having received a flat price for their milk previous to November 25, 1934, had no particular in-

130

BULLETIN No. 412

{.April,

centive for making any adjustments in the volume of milk they pro- duced in the different months.

More rigid enforcement of quality requirements in the St. Louis milkshed should reduce greatly the number of the so-called "in-and- outers," since it becomes unprofitable for a farmer who buys the necessary equipment to enable him to remain on the whole-milk market to ship milk to a condensery or other alternative market, where he gets a lower price for his milk.

300 240

o

K "120

60

180

PRODUCERS SHIPPING MILK 9 MONTHS OR LESS

(LOW MONTH 100}

£120

PRODUCERS SHIPPING MILK 10 MONTHS OR MORE

•(LOW MONTH* 100)

I Ml Ml II II I

JUNE JULY AUG. SEF

FIG. 30. MONTHLY VARIATION IN THE PRODUCTION OF Two GROUPS OF DAIRYMEN IN THE ST. Louis MILKSHED, JUNE, 1933, TO MAY, 1934

Dairymen who shipped milk nine months or less had a seasonal variation in production that was nearly four times as large as that of producers who shipped milk ten months or more.

The restoration of the basic-surplus plan, which tends to discourage wide seasonal variation in production, coupled with strictly enforced quality requirements, which will keep the sporadic producers out of the whole-milk market, should, the author believes, reduce greatly seasonal fluctuations in production in this market and thereby permit it to operate on a more efficient basis.

Basic-Surplus Plan Not Cause of Price Decline

The rapid decline in producer milk prices which took place from 1929 to 1933 caused much dissatisfaction among dairymen in the St.

1935] ST. Louis MILK PROBLEMS 131

Louis milkshed. Many individuals in the area attributed the decline to the basic-surplus plan of paying for milk which, as stated above, was adopted in October, 1930.

Actually, however, the basic-surplus plan had nothing to do with this price decline. Producers in the Minneapolis-St.Paul, New York, and other milksheds, who received a weighted average price during this period, were likewise dissatisfied with milk prices. The real cause for declining prices in the various milksheds of the country from 1929 to 1933 is not to be found in any particular type of plan for paying producers but may be traced to deep-seated economic disturbances, as already pointed out on pages 117 to 124.

Since the use of this plan tends to effect economies in transporta- tion and plant operation in addition to giving a higher average price to dairymen whose production of milk is more nearly in line with con- sumers' demands, it is not unlikely that sooner or later it will again be adopted in the St. Louis milkshed. In the meantime it would seem a wise policy for producers in this milkshed to continue to so adjust their feeding and breeding practices as to bring about a more even production of milk thruout the year.

DISTRIBUTORS' GROSS HANDLING MARGINS

A distributor's gross handling margin for a given unit of milk is the difference between the price that he pays producers for it and the price he receives for it.

Producers and consumers frequently assume that the gross hand- ling margin realized by distributors is the difference between the retail quart price of delivered milk and the wholesale price paid to producers for milk. The fact is that sales in quarts at retail constitute only a small proportion of the milk purchased from producers. For instance, in July, 1934, only 23.7 percent, or about one quart of every four purchased by distributors in the St. Louis sales area, was sold in quart bottles to retail consumers. The sale prices of the other three- fourths of the milk which distributors handle must of course be taken into account when one is considering their gross handling margins.

Proportions of Milk Utilized in Different Forms

For the twelve months from June, 1933, to May, 1934, approxi- mately half the milk purchased by distributors in the St. Louis dairy district was utilized as whole milk (Class I). These proportions held also for July, 1934 (Table 10).

132

BULLETIN No. 412

[April,

TABLE 10. UTILIZATION OF MILK PURCHASED BY DISTRIBUTORS IN THE ST. Louis DAIRY DISTRICT, JULY, 1934

Class

Amount

Percentage

Class I . .

Ibs. 18 285 155

50.7

Class II

3 603 342

10.0

Class III

14 168 155

39.3

Total

36 056 652

100.0

The half used otherwise than as whole milk was used as Class II milk, which constituted 10 percent of distributors' total purchases, and Class III milk, which made up 40 percent of distributors' pur- chases. Milk known as Class II and Class III is that used as table cream, condensed milk, or butter, or converted into other milk prod- ucts (see pages 146 and 147 for further definition of classes).

FIG. 31. PROPORTIONS OF CLASS I MILK SOLD THRU RETAIL AND WHOLESALE OUTLETS IN THE ST. Louis SALES AREA, JULY, 1934

More than half the total volume of Class I milk sold in the St. Louis area in July, 1934, was sold direct to retail consumers ; the other half was sold at wholesale prices to restaurants, stores, hotels, and other institutions.

ST. Louis MILK PROBLEMS

133

Retail and Wholesale Sales of Class I Milk

Of the total volume of Class I sales of milk in the St. Louis area in July, 1934, retail and wholesale sales comprized practically equiva- lent proportions 50.5 percent and 49.5 percent respectively (Fig 31). The total amount of Grade A milk, sold at retail and wholesale, con- stituted 9.6 percent of the total volume of Class I sales.

By far the larger part of the volume of Class I sales consisted of retail and wholesale quarts (retail quarts, 47.4 percent and wholesale quarts, 28.0 percent (Fig. 32 and Table 11). The volume of Class I

FIG. 32. PROPORTIONS OF CLASS I MILK SOLD IN THE PRINCIPAL SALES UNITS, ST. Louis SALES AREA, JULY, 1934

Retail quarts of milk (including Grade A) constituted slightly less than half the total sales of Class I milk in the St. Louis sales area in July, 1934; wholesale quarts, about three-tenths ; and wholesale gallons, about one-seventh. Together, these items equaled about nine-tenths of the total sales of Class I milk.

milk sold in these units, together with that sold in bulk gallons whole- sale, comprized 90 percent of the total Class I sales. The remaining 10 percent was divided among fifteen other sales units.

134

BULLETIN No. 412

[.April,

Gross Handling Margins on Class I Milk

Since distributors in the St. Louis sales area sell Class I milk in twenty different sales units (Table 11), they have twenty different gross handling margins. The margin for retail quarts in July, 1934, was 6.47 cents; for wholesale quarts, 3.47 cents; and for wholesale bulk gallons, 2.47 cents a quart (and less when wholesale bulk milk

TABLE 11. PROPORTIONS OF CLASS I MILK SOLD IN THE DIFFERENT SALES UNITS,

AND DISTRIBUTORS' GROSS HANDLING MARGINS ON EACH UNIT,

ST. Louis MILK SALES AREA, JULY, 1934

Sales units

Percent of total Class I milk sales

Distributors' gross margin on quart basis

Retail quarts

39.90

cents 6 47

Wholesale quarts '

27.99

3.47

15 09

2 47

7.52

8 61

Wholesale pints

2.93

7.47

Retail pints

2.22

9.47

1 83

9 47

Wholesale Grade A quarts

.80

6 61

Retail Grade A, Vitamin D, quarts

.53

9.18

.47

8 97

.26

12.61

Wholesale Grade A \^ pints

.22

14.61

.11

12 61

Retail Grade A }^ pints

.03

18 61

Wholesale Grade A pints

.03

10.61

.02

15 47

Wholesale Grade A Vitamin D quarts

.02

7.18

Retail Grade A Vitamin D pints

.01

14.18

.01

12 18

Wholesale Grade A Vitamin D J4 pints

.01

18.18

Total

100.00

5 41

TABLE 12. DISTRIBUTORS' AVERAGE GROSS MARGIN FOR HANDLING WHOLESALE QUARTS OF MILK, BOSTON AND ST. Louis, 1934a

City

Distributors' average sale price for wholesale quarts

Average price paid producers'5

Distributors' gross handling margin

St. Louis

8.9

4.5

4.4

Boston

9.0

6.6

2.4

Difference

2.0

•Based on monthly fluid-milk reports of the Bureau of Agricultural Economics, U. S. Department of Agriculture.

bMilk prices to producers are quoted on the basis of 3.5-percent butterfat content. Since milk sold by distributors to stores or consumers contained more than 3.5 percent butterfat, the average prices paid to producers were herein coi reeled to include the value of the additional butterfat con- tained in the milk when sold.

79J5] ST. Louis MILK PROBLEMS 135

was contracted at figures lower than quoted prices). The weighted average gross handling margins for the 20 retail units were 5.41 cents a quart, which is 1.06 cents a quart less than the margin on retail quarts.

The average gross handling margin of distributors in the St. Louis area on wholesale quarts for the year 1934 is shown in Table 12 in comparison with the margin on which distributors in the Boston area operated. The St. Louis margin was 4.4 cents, the Boston average 2.4 cents a wholesale quart.

ST. LOUIS MILK MARKET ORGANIZATIONS: AIMS AND ACCOMPLISHMENTS

The forces that determine how and in what volume milk shall be produced and what the marketing service shall be are not self- operative; they are influenced by the activities of all the groups con- cerned— producers, distributors, and consumers.

For the twenty years preceding 1929 the major policies followed in the production and marketing of milk in the St. Louis dairy district were determined by milk distributors. Consumers had no organized representation. Producers made several attempts to unify their inter- ests but in each instance the organization was short-lived.

Finally in 1929 an organization known as the Sanitary Milk Pro- ducers was effected among producers in the St. Louis milkshed in order to bargain collectively with distributors. In 1930 a consumer organization, the Consumers' Milk Commission, was established to represent consumer interests. The activities of this commission were taken over in 1934 by the St. Louis Consumers' Council. With the advent of these producer and consumer organizations, the control of the major policies in the St. Louis dairy district has become more nearly representative of all interests concerned.

At the present time milk policies in St. Louis are, in a measure, specified in the provisions of the federal milk license, which became effective on March 2, 1934, superseding a marketing plan approved and incorporated into a federal marketing agreement on November 25, 1933, after the passage of the Agricultural Adjustment Act.

The objectives and accomplishments of the principal organizations which influence the production and marketing of milk in this area are described in the following pages.

136 BULLETIN No. 412 {.April,

Sanitary Milk Producers

The Sanitary Milk Producers is a collective milk-bargaining as- sociation of producers located in the St. Louis milkshed. It was organ- ized in 1929 for the following purposes:1

1. "Standardization and improvement of milk and dairy products.

2. "Collective bargaining in selling.

3. "Control of surplus and supplying milk as the market demands.2

4. "Checking weights and tests.

5. "Watching credit rating of buyers.

6. "Issuing truthful market information.

7. "Advertising milk and dairy products to broaden the outlet."

In 1934 the association had a membership of about ten thousand producers organized into 112 local units. These producers supplied regularly 64 percent of the total volume of milk shipped to the St. Louis market (Fig. 2). The organization is an active member of the National Cooperative Milk Producers' Federation. Operating expenses of the association are financed by a membership fee and a "check-off" taken from the amounts due members for milk shipments. The amount of this check-off has varied from 3 to 5 cents a hundred pounds of milk ; in December, 1934, it was 3 cents a hundred pounds of milk.

The management of this association has made steady progress in carrying out the program outlined above, and much of the improvement in the market organization in the St. Louis dairy district since 1929 can be credited to its activities.

Milk Distributor Groups

Milk distributors in the St. Louis sales area are not organized into a formal trade association. Since, however, three distributors buy two- thirds of the milk in the market and ten purchase nine-tenths of it, it is possible to effect working agreements without a formal association.

Milk dealers in the St. Louis market were represented in the joint conferences of distributors, producers, and consumers in the summer of 1930 (see page 137) by the representatives of the St. Louis Dairy Company, the Highland Dairy Company, and the Beatrice Creamery Company. Likewise, in the price conferences held in this market from 1930 to 1933 distributors were usually represented by individuals from the principal companies. These price conferences were discontinued upon the adoption of the federal marketing agreement.

"As stated in the Illinois Agricultural Association Record, April, 1929, p. 1. *The author suggests that this objective be changed to read: "adjustment of milk production to meet market demands."

79J5] ST. Louis MILK PROBLEMS 137

In the early part of 1934 a group of small dealers in the St. Louis market organized into the Small Dealers' Association, which includes .(December, 1934) twenty-five distributors. The association discusses and takes action on problems which are of mutual interest to these small dairies in the St. Louis market.

Another dealer organization in the city is the St. Louis Milk Exchange, which was organized in 1932. This organization provides for the systematic return of milk bottles and other milk packages to the original owners. For each package received from or returned to the exchange, milk dealers pay or receive a stipulated price. This is an economic way of lowering the very heavy losses that otherwise occur on milk bottles and other milk packages.

Consumers' Milk Commission

Much of the improvement in producer-distributor relations in the St. Louis market from 1930 to 1933 can be credited to the activities of the Consumers' Milk Commission.

This commission, sponsored by the St. Louis League of Women Voters, was organized March 3, 1930, at a meeting called by the Sanitary Milk Producers, at which it was explained that the serious financial condition of the dairymen who produced the supply of milk for St. Louis seemed likely to be reflected in a poorer quality of milk delivered into the city.

On June 4, 1930, in the headquarters of the League, the first of a series of three conferences was held by eighteen persons representing dealers, producers, and the Consumers' Milk Commission. The purpose of this meeting was to consider the objectives of the Sanitary Milk Producers and dealers' reactions to the development of a marketing plan for the purchase and sale of milk in this area. On July 7, 1930, this large group was reduced to a joint conference committee of nine three members representing dealers, three representing producers, and three representing consumers.1

Four conferences by this committee were held to discuss milk marketing agreements and price plans. In August, 1930, the committee agreed upon provisions for a marketing plan, and the consumer repre-

'Dealer representatives were: B. M. Lide, Jr., president of the St. Louis Dairy Company; Bruno Tschannen of the Highland Dairy Company; and H. W. Barr, president of the Beatrice Creamery Company. E. W. Tiedeman, A. D. Lynch, and George Grueningcr represented the Sanitary Milk Producers. Con- sumers were represented by Mrs. George Gellhorn, Mrs. W. W. Burke, and Mrs. Virgil Loeb. Mrs. Loeb was made chairman of the committee at the joint conference.

138 BULLETIN No. 412 [April,

sentatives of the committee presented a report of their activities. From 1930 to 1933 the Consumers' Milk Commission was represented at each of the price conferences which took place in the St. Louis market. As stated above, these conferences ceased with the adoption of the federal milk marketing agreement.

The writer is convinced that the type of conference sponsored and developed by this commission is a definite help in solving producer- distributor-consumer problems and differences in this market, and might well be reestablished.

St. Louis Consumers' Council

The Consumers' Council of St. Louis and St. Louis county, one of 200 such councils set up thru the nation by the National Emergency Council, was organized in May, 1934.

Members of local councils are appointed by the local chairman, who is in turn appointed by the National Emergency Council. Mem- bers of the St. Louis Consumers' Council serve without pay and are chosen because of their reputations as public-spirited and informed members of the community. Specialists in social sciences, those who have had practical experience in marketing organization work, and specialists in research are included in the membership.1

The main purpose of the St. Louis Consumers' Council is to focus consumers' endeavors and to give consumers adequate representation in solving local problems, as well as to obtain and disseminate infor- mation relating to retail prices and standards of quality. It has taken definite action toward improving the quality of milk in St. Louis. Two major provisions of its present program are (1) to improve present standards for obtaining milk of high quality; and (2) to insure ade- quate financing and a nonpolitical personnel for the enforcement of a quality improvement program.

This organization had an important part in effecting the passage of an ordinance which became effective December, 1934, governing

'The present members (December, 1934) of the Council are: Mrs. Roscoe Anderson, chairman ; Reverend Father W. F. Mullally, vice-chairman ; Mrs. Herman Maas, secretary; Mrs. George A. Bass, Mrs. F. B. Bowles, Miss Esther Lee Bride, Mrs. W. W. Burke, Mrs. Walston Chubb, Mr. Ralph Fletcher, Mrs. George Gellhorn, Dr. George M. Gibson, Mr. Raymond Howes, Dr. F. M. Isserman, Mrs. Edmund J. Kerber, Mr. Joseph M. Klamon, Mrs. Virgil Loeb, Bishop William J. Scarlett, Dr. David C. Todd, Mrs. W. Victor Weir, Mr. Tyrell Williams. It will be observed that Mrs. Gellhorn, Mrs. Loeb, and Mrs. Burke, formerly members of the Consumers' Milk Commission, are now members of the Consumers' Council. Mr. J. C. Waldron, the survey secretary of the Council, is engaged in assembling and disseminating facts pertaining to Council activities.

1935}

ST. Louis MILK PROBLEMS

139

quality requirements for milk and providing methods for financing their enforcement.

St. Louis Division of Public Health

The St. Louis Division of Public Health is responsible for main- taining inspection and control of the quality of milk and milk products sold in the city of St. Louis. Specific provisions for controlling the quality of milk and milk products prior to November, 1934, were in- cluded in an ordinance approved March 21, 1928. A new ordinance, as mentioned above, containing requirements more stringent than those previously in force, became effective on November 22, 1934.

In practice the Division of Public Health in St. Louis was very lax in enforcing quality requirements included in the ordinance of 1928. As a result dairymen producing high-quality milk were penal- ized ; and those producing low-quality milk benefited, since producers were paid the same price for milk regardless of quality. Furthermore milk of lower quality than specified as minimum quality by the ordi- nance was permitted to be offered for sale to consumers. Part of the laxity in enforcing quality requirements can be attributed to lack of funds for carrying out an effective program.

Certain requirements under the 1928 ordinance were much lower

TABLE 13. MAXIMUM NUMBER OF BACTERIA PERMITTED IN MILK BEFORE AND AFTER PASTEURIZATION, IN 14 CITIES OF THE UNITED STATES WITH MORE THAN 500,000 POPULATION, JULY, 1934»

City

Maximum bacteria count before pasteurization

Maximum bacteria count after pasteurization

Baltimore

200 000

30 000

Boston

750 000

50 000

Buffalo

100 000

30 000

Chicago1"

750 000 Oct. to April

50 000 Oct.-Apr.

Cleveland

1 000 000 May to Sept. 1 000 000

100 000 May-Sept. 100 000

Detroit

Not fixed

Not fixed

Los Angeles

150 000

15 000

Milwaukee

Not fixed

250 000

1 000 000

25 000

New York

750 000 if to be pasteurized

50 000

Philadelphia

in city 300 000 if to be pasteurized outside city Not fixed

50 000

Pittsburgh

Not fixed

Not fixed

St. Louis'

4 000 000

100 000

San Francisco

150 000

15 000

•Sources of data are given on page 181, Appendix.

bThe Chicago ordinance was revised in December, 1934, to include a maximum bacteria count of 200,000 before pasteurization and 30,000 after pasteurization, no seasonal variation being permitted.

•The St. Louis ordinance was revised in December, 1934, to include a maximum bacteria count of 1,500,000 before pasteurization.

140 BULLETIN No. 412 [.April,

than those of other large markets in the country. The requirements for raw milk to be pasteurized were the most lenient of the ten largest markets of the country that include definite bacteria counts in their ordinances (Table 13). In St. Louis the maximum bacteria count of raw milk before pasteurization was 4 million per cubic centimeter, four times the count permitted at Cleveland, Chicago, and Minneapolis, which permit a maximum of one million per cubic centimeter, and twenty-seven times that of Los Angeles and San Francisco, which per- mit a maximum of only 150,000 per cubic centimeter. The maximum bacteria count after pasteurization was the same as that for Chicago and Cleveland and lower than that for Milwaukee.

In the new ordinance the bacteria counts permitted in the raw milk to be pasteurized for sale have been materially reduced, and consumers will be assured of clean, safe milk if the specified quality requirements are enforced.

St. Louis District Dairy Council and Dairy Commission

The St. Louis District Dairy Council was organized on February 1, 1931, for the purpose of bringing about a greater consumption of milk thru a general educational program stressing the importance of milk and milk products in a well-ordered diet. The subject of food and nutrition as a necessary part of a general health program is pre- sented by staff members thru cooperation with educational and health agencies, by personal contact and letter, by distribution of leaflets and posters, and by the showing of plays and motion pictures.

Funds to support the Dairy Council's activities have been contri- buted by milk distributors and producers in the St. Louis district. Under an agreement between these two groups, which became effective in December, 1934, the educational program of the Dairy Council be- came part of the program of the Dairy Commission of St. Louis. This commission also is financed jointly by producers and distributors.

The Dairy Council and the Dairy Commission work with public, private, and parochial school teachers, boys' and girls' clubs, parent- teacher associations, community clubs, church and fraternal organiza- tions, the health department, and various individual groups. The type of information included in the educational programs assembled for these organizations furnishes a constructive basis for increasing the consumption of milk and dairy products. Perhaps the only word of caution for this organization is that the expenditure of funds for the purpose of increasing consumption of dairy products be carefully planned in order to insure results commensurate with their cost.

1935] ST. Louis MILK PROBLEMS 141

Production Credit Associations

More stringent requirements concerning the quality of milk to be offered for sale in St. Louis are likely soon to force many farmers in the St. Louis milkshed to purchase new equipment. The cooperative production credit system, recently established thruout the United States, affords an economical way for producers with adequate security to obtain loans for these purposes.

One of the twelve Production Credit Corporations is located at St. Louis. Production credit associations that are branches of the Pro- duction Credit Corporation, serving the producers in the St. Louis milkshed, are located at Carrollton, Carlinville, Belleville, Shelbyville, and Mt. Vernon in Illinois, and Bloomfield, Farmington, Hannibal, Rolla, O'Fallon, St. Joseph, Steelville, and West Plains in Missouri.

The current rate of interest to borrowers in production credit as- sociations is 5 percent for the actual time that the money is in use. Loans to dairymen can be made for one year but will be considered for a period not to exceed three years. Renewals are contingent upon new application, inspection, and approval of the collateral offered as security.

The estimated cost of the inspection fee for obtaining a loan of $150 to $200 is $2.00, and other costs incident to a loan usually do not exceed $1.50. On an annual basis the interest and charges on a $200 loan are about 6.5 percent.

To be eligible for a loan, each borrower must become a member of the association and must purchase five dollars' worth of Class B stock for each $100 borrowed. After a loan has been repaid, this stock can be listed with the production credit association to be sold, according to the present policy of the Farm Credit Administration, to new borrowers that qualify for loans before new stock is issued. In this manner it is possible for old borrowers to retire their investment in the stock.

All loans to producers of fluid milk are customarily retired on a monthly repayment plan with a minimum monthly repayment of 3 percent of the money borrowed. It is also customary to ascertain that the borrower has a definite milk base, and then to have the pur- chaser of the milk accept an assignment to make deductions from the monthly milk check and remit these to the local association making the loan. It is believed that many producers in this milkshed will find it profitable to make use of these new credit facilities.1

'Complete detailed instructions for obtaining a loan can be secured by ap- plying to the nearest production credit association or to the Production Credit Corporation, St. Louis, Missouri.

142

BULLETIN No. 412

Dairy Herd Improvement Associations

[April,

Dairy herd improvement associations have been in existence in the Middle West for more than twenty years. The principal objective of the associations is to increase efficiency in the production of milk, so that farmers may realize higher net returns from their dairy herds, this objective to be realized by:

1. Improving feeding practices

2. Rigid culling of unprofitable cows

3. Improving dairy herds thru the location of families of cows of out-

standing merit

4. Improving herd sires

5. Increasing the owner's interest in his dairy herd

Records kept by these associations show clearly that one of the best ways for a producer to realize better returns above feed costs is to in- crease his production per cow. Thus in 1933, 383 cows producing more than 500 pounds of butterfat per cow returned an average of $133.84 per cow above feed costs; whereas cows producing less than 150 pounds of butterfat returned an average of only $7.76 above feed costs (Fig. 33 and Table 14).

The need for broader adoption by producers in the St. Louis milk- shed of practices that will improve their productive efficiency is em- phasized by comparing the average annual production per cow in this area with that for all Illinois cows and for all cows in dairy herd im-

POUNDS OF

BUTTERFAT

PER COW

ANNUAL RETURNS PER COW ABOVE FEED COST

O 25 50 75 100 125 150

OVER 500

450- 500

400-450

350-400

300-350

250-300

200-250

150-200

UNDER 150

FIG. 33. RETURNS PER Cow AS RELATED TO VOLUME OF BUTTERFAT

As production per cow increases, returns above feed costs increase. Thus for cows producing over 500 pounds of butterfat, the returns above feed costs averaged $133.84 per cow; while for cows producing less than 150 pounds of butterfat the returns averaged only $7.75 above feed costs. This graph is based on the records of 53 dairy herd improvement associations in Illinois in 1933.

1935}

ST. Louis MILK PROBLEMS

143

TABLE 14. AVERAGE RETURNS PER Cow ABOVE FEED COSTS, AS RELATED TO

PRODUCTION PER Cow, FROM RECORDS OF 53 ILLINOIS DAIRY HERD

IMPROVEMENT ASSOCIATIONS, 1933»

Pounds of butterfat

Number of cows

Fat per cow

Returns per cow above feed cost

500 and over

383

Ibs. 553.6

£133.84

450-499

544

472.1

107.05

400-449

1 088

421.8

93.35

350-399

2 095

373.0

77.92

300-349

2 799

324.0

65.67

250-299

2 562

276.3

51.99

200-249

1 499

229.2

40.33

150-199

531

180.2

26.78

Under 150

189

118.4

7.76

•Rhode, C. S., and Cash, J. G., "A Year's Progress in Dairy Herd Improvement." Univ. of 111., Dept. of Dairy Husbandry, April, 1934. Mimeo.

provement associations in Illinois. The average milk production in the St. Louis milkshed in 1934 was 4,161 pounds per cow, whereas the Illinois average was 4,690 pounds per cow, and the average in 1933 for all dairy herd improvement associations in Illinois was 8,331 pounds per cow.

The following associations are now operating in Illinois in the St. Louis milkshed: Jersey-Greene-Morgan Association; St. Clair-Mon- roe-Randolph Association ; Effingham County Association ; Montgom- ery-Macoupin Association ; and Macoupin-Madison Association. On the Missouri side of the St. Louis milkshed the following associations are operating: Rails-Marion Association; Pike-Lincoln Association; St. Charles-St. Louis Association ; and Jefferson Association.

Since dairy herd improvement associations afford a practical way for farmers to obtain help in increasing the efficiency of their produc- tion, and since the benefits of these associations extend much farther than to participating members, these associations should be given en- couragement by all persons and agencies concerned in improving pro- duction practices in this area.

PRESENT POLICIES UNDER FEDERAL MILK LICENSE

Under Section 8 of the Agricultural Adjustment Act approved May 12, 1933, the Secretary of Agriculture was given power to issue licenses which would assist in bringing about improvements in the marketing of milk. The powers specified in the act are:

"To issue licenses permitting processors, associations of producers and others to engage in the handling, in the current of interstate or foreign commerce, of any agricultural commodity or product thereof, or any com-

144 BULLETIN No. 412 {.April,

peting commodity or product thereof. Such licenses shall be subject to such terms and conditions, not in conflict with existing Acts of Congress or regulations pursuant thereto, as may be necessary to eliminate unfair practices or charges that prevent or tend to prevent the effectuation of the declared policy and the restoration of normal economic conditions in the marketing of such commodities or products and the financing thereof.

"To require any licensee under this section to furnish such reports as to quantities of agricultural commodities or products thereof bought and sold and the prices thereof, and as to trade practices and charges, and to keep such systems of accounts, as may be necessary for the purpose of part 2 of this title."

Purposes and Scope of License

Under the authority of the above act, the Agricultural Adjustment Administration, upon the request of the Sanitary Milk Producers, issued a milk license applicable to all milk producers and distributors in the St. Louis sales area. The license, which became effective on March 2, 1934, embodies the following statement of purposes and powers :

1. To increase the income of the dairy farmer.

2. To increase the farmer's share in the management and operation of

his own market.

3. To maintain proper relationships between producers on the same

market and between groups of producers in different markets.

4. To provide reasonable protection to the consumer.

5. To define use-classifications which shall be employed as the basis for

sale of milk to distributors, and to require each distributor to submit monthly reports of the sale of milk in each of these classi- fications.

6. To fix minimum prices for each classification to be paid by each dis-

tributor in the St. Louis sales area for whole milk received from producers.

7. To change classification prices from time to time as necessitated by

changes in market conditions.

8. To define zones and fix transportation differentials for milk received

outside of the St. Louis sales area.

Functions of Milk Market Administrator

In order to carry out the provisions of the federal milk license, the office of Milk Market Administrator was created by the Secretary of Agriculture, under the authority of the Agricultural Adjustment Act. In the St. Louis dairy district the responsibilities of this office are principally the following:

1. To operate a market pool and an equalization fund, in order (a) to assure competing distributors that each will pay the same price for milk in the same classification, and to prevent by this as-

1935} ST. Louis MILK PROBLEMS 145

surance destructive distributor competition and price-cutting in the purchase of milk from producers; (b) to distribute, on a fair basis, proceeds to producers in the milkshed.

2. To audit books of each distributor in order to assure producers and

competing distributors that the sales reported to the market ad- ministrator represent actual sales.

3. To request each distributor to furnish bond or other satisfactory

surety that will guarantee to producers payment for milk pur- chased.

4. To check distributors' samples, weights, and butterfat tests of milk

for producers who are not members of the Sanitary Milk Pro- ducers.

5. To furnish market information to producers, distributors, and con-

sumers in the St. Louis dairy district.

In essence, these regulations are designed to eliminate some of the destructive market practices which have operated against the best interests of producers, distributors, and consumers in the St. Louis sales area.

Use-Classification Principle Recognized

A fundamental principle of milk marketing which is recognized in the St. Louis federal milk license is that distributors should pay for the milk they purchase, according to the way in which the milk is used. The practice of classifying milk according to its use is based upon differences in market values recognized by distributors and manufac- turers who use the milk.

In the classified, or use, system of paying for milk there may be one price for milk used in fluid form, another price for milk separated to be used as cream, and still another price for milk manufactured into other products. When distributors and manufacturers pay for milk on a use basis, a market pool, together with an equalization fund, becomes necessary if payments for milk are to be fairly distributed to producers (see pages 152 to 155).

The classification, or use, price plan was in operation as far back as 1898. "In 1898, for a period of five or six years, the Boston milk contractors accounted for their surplus for what it was worth made into butter, and credited the market value of this surplus back to the producer."1 The Dairymen's League Cooperative Association in New York State commenced to use this type of plan in May, 1921. Besides being used in Boston and New York, the plan is also in operation in Chicago, Cleveland, Detroit, Los Angeles, Pittsburgh, Baltimore, and Minneapolis-St. Paul, as well as in about seventy-five other cities in the

'Personal communication from W. H. Bronson, Research Department, New England Milk Producers' Association, Boston.

146 BULLETIN No. 412 [April,

United States ; and it is generally recognized by students of milk marketing as being a distinct advance over previous methods used in the purchase and sale of milk.

The classes outlined in the St. Louis federal milk license1 are three and are defined as follows:

"Class I milk means all milk sold or distributed by distributors as whole milk for consumption or use in the St. Louis Sales Area.

"Class II milk means all milk used by distributors to produce cream for consumption as cream, evaporated milk, condensed milk, flavored drinks, creamed buttermilk, and creamed cottage cheese, for sale or distribution by distributors in the St. Louis Sales Area, Provided, that the milk from which only the skimmed milk is used in the production of the above products shall not be included as Class II milk.

"Class III milk means the quantity of milk purchased, sold, used or distributed by distributors in excess of Class I and Class II milk."

Producer Prices in St. Louis Area

According to the federal milk license, prices for milk in the St. Louis sales area are based upon milk of 3.5-percent butterfat content delivered f .o.b. distributor's plant in the area. The prices which became effective on August 14, 1934, were as follows (per 100 pounds):

Class I milk, $2.35; Class II milk, $1.33; Class III milk, $1.02. These prices were determined as follows:

Class I milk. The price for Class I milk, in any market, is the highest price that is obtainable when the principal economic factors in the particular area in which it is sold and the conditions and welfare of the dairy industry as a whole are taken into account. The above price remained in effect until November 16, 1934, when it was lowered to $2.00 as a result of excessive quantities of milk coming to the market.

Class II milk. The price for Class II milk is determined by the formula: "For each 100 pounds of milk, 3.5 times the average price per pound of 92 score butter at wholesale in the Chicago market, as reported by the United States Department of Agriculture for the de- livery period during which such milk is purchased, plus 30 percent thereof plus 20 cents." Applying this formula to the market conditions of September, 1934, we have:

3.5 times $.2482 (price per pound of 92-score butter at wholesale in Chicago markets) equals $.8687

1.30 times $.8687 equals $1.13

$1.13 plus $.20 equals $1.33

'Amended license for milk, St. Louis sales area, effective August 14, 1934.

79J5] ST. Louis MILK PROBLEMS 147

Class III milk. For Class III milk the following formula is used: "For each 100 pounds of milk, 3.5 times the average price per pound of 92 score butter at wholesale in the Chicago market, as reported by the United States Department of Agriculture for the delivery period during which such milk is purchased plus 15 cents." Applying this formula we have:

3.5 times $.2482 equals $.87

$.87 plus $.15 equals $1.02

Producer Prices Converted to Weighted Average

As a means of distributing payments for milk to producers, dairy- men in the St. Louis milkshed, beginning in the latter half of Novem- ber, 1934,1 were paid one price for their milk a weighted average price based on the prices and volumes of milk of the different classes sold in the area, and subject of course to variation for butterfat con- tent, transportation charges, and other differentials. This plan replaced the market-blend and excess prices2 in effect from March to Novem- ber, 1934.

The weighted average price, when milk is sold on a classified or "use" basis, is the quotient obtained by dividing the total market value of Class I, Class II, and Class III milk by the total volume of milk produced. For example, if we assume that of a total 200,000 pounds of milk, Class I sales consisted of 100,000 pounds at $2.00 a hundred- weight; Class II sales, 80,000 pounds at $1.30 a hundredweight; and Class III sales, 20,000 pounds at $1.00 a hundredweight, the total market value of the 200,000 pounds of milk was $3,240. The weighted average price would then be $1.62 a hundredweight ($3,240 divided by 200,000).

While the use of a weighted average price is designed to distribute payments for milk more equitably among producers than the flat-price system formerly in use, the plan has rather serious disadvantages. Unless, for instance, some arrangement is included whereby prices are reduced during periods of low production costs and increased during periods of high production costs, the use of such a system encourages, rather than discourages, production during the months of low costs, when surpluses are already burdensome.

The effect of using a weighted average price for whole milk thru-

'Under the license as amended November 14 to become effective Novem- ber 16, 1934.

"The market-blend price was about equal to the weighted average of Class I and Class II milk prices, and the excess price equaled the price paid by distribu- tors for Class III milk.

148

BULLETIN No. 412

[April,

out the year is shown by production records in the New York milkshed since May, 1921, when this system of payment was adopted. The average daily increase in the milk production of about 15,000 dairymen in this area for the five Junes from 1926 to 1930, compared with the five Junes from 1921 to 1925, was 14.7 pounds higher per producer than the average increase for all sixty months of the later period com- pared with all sixty months of the earlier period. (Table 15 and Fig. 34).

40

§10

rr

JAM FEB. MAR. APR. MAY JUNf JULY AU6.UPT OCT. NQV OfC

FIG. 34. AVERAGE DAILY INCREASE IN MILK PRODUCTION PER FARM BY

15,000 DAIRYMEN IN NEW YORK STATE, 1926-1930 OVER 1922-1925,

UNDER WEIGHTED AVERAGE PRICE PLAN OF PAYING FOR MILK

A weighted average price has been used since May, 1921, in paying pro- ducers in the New York«milkshed. This has caused a greater increase in milk production in the spring and summer than in the shortage months, and con- sequently a widening of the area necessary to supply the whole-milk needs of the New York sales area.

The greater concentration of production in the months of low costs has caused a widening of the milkshed to meet the needs of the fluid- milk market during the months of higher costs and lower production; and the widening of the milkshed has in turn increased hauling costs and the operating costs of country and city plants in taking care of peak loads of production.

It would seem that the making of seasonal adjustments in the weighted average* price for whole milk might be an effective way of inducing dairymen to adjust production more nearly to seasonal de- mands ; but the fact is that such adjustments in the weighted average price have not proved practical, for there is a tendency to keep Class I prices at too high a level in months when production costs are low and at too low a level in months when production costs are high.

While the St. Louis market doubtless will benefit by the use of this system of paying milk producers, compared with a flat-price system,

1935]

ST. Louis MILK PROBLEMS

149

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150 BULLETIN No. 412 {.April,

there seems to be no evidence that it will help in the solution of the problem of seasonal surpluses, which is one of the troublesome prob- lems in the industry.

Reasons for Price Differences Based on Milk Use

People not familiar with the fluid-milk business frequently ask why there should be differences in the prices paid by distributors for milk of different classes when "Class I milk is of no better quality than milk used as cream or in manufactured products."

The fact is that while a considerable volume of milk sold for manu- facturing purposes is actually of the same quality as Class I milk, it need not be of as high quality to be acceptable for those purposes, it need not be produced to such a large extent in the high-cost months nor in high-cost seasons, and it need be transported in bulk form only to a country market, not to a city market. It therefore cannot com- mand a price that is any higher than that for milk of acceptable quality produced under less costly conditions and delivered in bulk form nearer to the point of production.

The reasons for milk of Class I quality being more expensive to produce than milk for other purposes may be summarized as follows:

1. Requirements with respect to the conditions under which Class I milk is produced and marketed, and with respect to its final quality, are usually much more stringent than those for milk utilized in a condensery, creamery, or manufactured into other products. It costs producers money to meet these requirements. Since the surplus milk of Class I quality produced incidentally in the effort to meet the de- mand for Class I milk cannot be sold at a price commensurate with its unit production cost, the milk that is sold for fluid purposes must bear more than its unit cost. Thus the spread between the price of Class I milk and milk sold for other purposes becomes still wider than a pro- portionate difference in basic unit costs. If, in the future, it is required that milk utilized in manufacture be of the same quality and produced under the same conditions as Class I milk, the reasons for the differ- ence between the prices of milk sold in these different classes would be removed except to the extent that differences in transportation costs continued to be operative.

2. The demand for Class I milk is just as great during months of high costs as during months of low costs (Fig. 29). Producers who adjust their year-round production in an attempt to meet this rather uniform demand must incur higher costs in certain months in order to do so. The necessity for meeting a constant demand regardless of

79J5]

ST. Louis MILK PROBLEMS

151

unusual conditions such as floods, drouths, or other events beyond the control of man, also increase the costs of producing Class I milk during such abnormal periods.

As to transportation, the purchasing points to which producers deliver milk for manufacturing purposes are in the country; hence transportation costs are less. Because of this fact, the price that a

FIG. 35. COUNTRY SHIPPING STATIONS AND TRANSPORTATION ZONES IN THE ST. LOUIS MlLKSHED, 1934

Transportation deductions in the St. Louis milkshed are made on the basis of 10-mile zones. See Table 16.

producer gets for milk in any class is not the quoted f.o.b. city market price but the quoted price less a differential for transportation. It is therefore necessary, when comparing Class I milk prices with conden- sery prices or prices for milk to be used in other manufactured products, to make certain deductions from f.o.b. city milk prices before arriving at a just basis of comparing these prices at country points.

152

BULLETIN No. 412

[April,

Transportation deductions which apply in the St. Louis milkshed under the St. Louis federal milk license are shown in Table 16; the zones are mapped in Fig. 35.

TABLE 16. TRANSPORTATION DEDUCTIONS FROM PRICES OF MILK PURCHASED F.O.B.

ST. Louis BY DISTRIBUTORS IN THE ST. Louis DAIRY

DISTRICT, 1934B

Zone

Distance from St. Louis

Deductions per 100 pounds

Class I and Class II milk

Class III milk

1...

miles ...20 21-30 31-40 41-50 51-60 61-70 71-80 81-90 91-100 101-110 111-120 121-130 131-140 141-150 151-160

cents 16 18 20 21 22 23 24 25 26 27 28 29 30 31 32

cents 5 5 5 5 5 5 5 5 5 5 5 5 5 5 5

2

3

4

5

6

7

8

9

10

11

12

13

14...

15

•These differentials became effective August 14. 1934.

Equalization Fund Eliminates Destructive Price Cutting

When producers are paid a market-blend or a weighted average price, unjust conditions may arise on the one hand among distributors competing for markets and using varying quantities of the different classes of milk and, on the other, among producers selling to different distributors. To overcome this possibility, the Dairy Division of the Agricultural Adjustment Administration, in cooperation with organized producers and distributors in the St. Louis market, introduced a price plan that includes the use of an equalization fund. By the use of this fund competition among distributors is changed from a struggle to obtain milk at the cheapest possible price to an attempt to lower their costs of distribution by more efficient handling. Producers, relieved from sharp price-cutting competition, may turn their attention to im- proving quality and to lowering their costs of production by more efficient practices.

How Plan Works for Distributors. For distributors the essential feature of the equalization plan is that each distributor is enabled to pay .the weighted average price for all the milk he buys, without loss

1935}

ST. Louis MILK PROBLEMS

153

to himself or undue advantage over others because his purchases of milk are made up of relatively different proportions of the various classes than the purchases made by other dealers. The way in which the equalization fund works from the distribution angle is shown in Table 17.

Suppose two dealers, Distributors A and B, are operating on the same market. If Distributor A purchases 70,000 pounds of Class I milk at $2.00 a hundredweight, 30,000 pounds of Class II milk at $1.30, and no Class III milk, the total market value of this milk is $1,790. If Distributor B purchases the same total amount of milk but the milk is differently classified as, for example, 30,000 pounds of Class II milk and 20,000 pounds of Class III milk, the total market

TABLE 17. EXAMPLE OF METHOD USED FOR DETERMINING THE WEIGHTED AVERAGE

PRICE OF MILK TO PRODUCERS AND THE OPERATION OF THE

EQUALIZATION FUND"

Classes of milk bought

Pounds

Price per 100 pound

Market value

Payments to producers

Clearances in equaliza- tion fund

Total producers' sales to given market

Class I

100 000

£2.00

$2 000

Class II

80 000

1.30

1 040

Class III

20 000

1.00

200

Total

200 000

3 240

Weighted average price ....

1.62

Payments by Distributor A, buying Class I and Class II milk

Class I

70 000

S2.00

$1 400

Class II

30 000

1.30

390

Total purchases

100 000

1 790

Average market value

1.79

Payments to producers at

100 000

1.62

Jl 620

Difference paid to equalization fund

$170

Payments by Distributor B, buying Class I, Class II, and Class III milk

Class I

30 000

$2 00

$ 600

Class II

50 000

1.30

650

Class III

20 000

1.00

200

Total purchases

100 000

1 450

1 45

Payments to producers at weighted average price . . .

100 000

1.62

$1 620

Difference paid from equaliza- tion fund

-J170

Net difference

0

•In this example it is assumed that the base and excess volumes of Distributors A and B were exactly the same.

154 BULLETIN No. 412 [.April,

value of Distributor B's milk is $1,450. But each distributor is required actually to pay the weighted average price (explained on page 147), which in this case is $1.62 a hundredweight (Table 17). Distributor A would therefore pay $1,620 for his 100,000 pounds of milk worth $1,790, and Distributor B would pay $1,620 for his 100,000 pounds worth $1,450.

It is at this point that the equalization fund comes into use. A is required to turn over to the fund $170, the amount by which the market value of his milk exceeded the amount he was required to pay. for it. Distributor B receives from the fund $170, which is the amount by which his payment to producers exceeded the market value of the milk he bought. In this way these two distributors, altho using differ- ent quantities of the various classes of milk, pay to producers the same weighted average price for all the milk they buy.

How Plan Works for Producers. To ascertain how the equaliza- tion plan works for producers, we may assume that Farmer Jones ships milk to Distributor A, and Farmer Brown, his neighbor across the road, ships to Distributor B. If Farmer Jones were paid by Distribu- tor A a weighted average price for all the milk which A bought of him, he would be paid $1.79 a hundredweight for it. Under the same scheme Farmer Brown selling to Distributor B would receive only $1.45 a hundredweight for milk of presumably the same quality. Obviously Farmer Brown would be dissatisfied. He and other farmers so situated would undoubtedly quit selling to Distributor B and would try to sell to A, with resulting instability and destructive competition. But when, thru the operation of the equalization fund, distributors are enabled to pay one weighted average price for all the milk they buy, this source of competition and dissatisfaction among producers is removed.

The weakness of this plan, from the production angle, is that it in- cludes the use of one average price for milk thruout the year, and thus intensifies the surplus problem, as pointed out on pages 128 to 130.

Accurate Audits of Distributors' Records Essential to Plan. It is evident from the foregoing discussion that the payment of a weighted average price and the operation of an equalization fund is possible only when bookkeeping operations are both accurate and open. In order to provide this service, the federal license gives the Market Adminis- trator certain definite auditing powers, as follows:

"The Market Administrator shall have the right .... to examine the books and records of the distributors and the books and records of affiliates and subsidiaries of each distributor for the purpose of (1) verifying the reports and information furnished to the Market Administrator by each

1935] ST. Louis MILK PROBLEMS 155

distributor pursuant to this License and/or (2) obtaining the information from any distributor in the event such distributor fails to furnish reports or information as required by this License."1

In pursuance to this provision, the distributors in the St. Louis sales area are required to submit monthly reports to the Market Administra- tor showing the volumes of each of the three classes of milk they have handled. The license, as may be noted from the above quotations, specifically empowers the Market Administrator to verify these reports. This provision is essential to the success of the plan, for failure to re- port sales accurately would result in unfair competition between dealers and in losses to farmers who were not paid the full market value for their milk.

Since the initiation of the federal milk license in March, 1934, a force of auditors has been at work in the St. Louis market verifying the reports submitted by dealers.

Distributors Bonded to Insure Pay to Producers

For the adequate protection of producers it is essential that all dis- tributors be able to meet their financial obligations to producers when due; and for that reason, under the federal license, distributors re- porting sales may be required to furnish bond to the Market Admin- istrator in an amount not in excess of the purchase value of two months' supply of milk.

If the Market Administrator is satisfied that a distributor can ful- fil his obligations to pay for milk purchased, he may waive the require- ment for bond from such distributor ; but the authority to place dis- tributors under bond for this purpose is essential to securing for pro- ducers adequate protection against distributors' insolvency.

All Producers Contribute to Service Fund

The effective operation of the federal milk license, or any other comprehensive plan for administering a city milk supply, calls for funds with which to pay for certain services that must be available to producers if they are to conduct their business operations intelli- gently and be assured of fair treatment in certain technical aspects of their transactions.

A large number of producers in the St. Louis milkshed have pro- cured some of the necessary services by organizing into the associa- tion known as the Sanitary Milk Producers. Others have worked

'Amended license for milk, St. Louis sales area, effective August 14, 1934.

156 BULLETIN No. 412 {.April,

blindly or ineffectively without such service; while others have bene- fited from the information that is made available thru the efforts of the organized farmers.

In order to provide producers generally with authentic market in- formation and assure them proper weights and tests, the federal milk license gives the Market Administrator authority to deduct 3 cents a hundred pounds from the amount due producers for milk sold to dis- tributors. The following paragraph on this point is quoted from the license:1

"Each distributor shall deduct for marketing services three (3) cents per hundredweight of milk from the payments to be made pursuant to article IX for all milk delivered to such distributor by producers, and on or before the 15th day after the end of each delivery period, pay such amount to the Market Administrator. Such monies shall be expended by the Market Administrator, in a manner hereinafter prescribed, for the purposes of securing to producers the following services: (a) market in- formation, (b) supervision of weights and tests, (c) to the extent that funds permit, the establishment and maintenance of a reserve fund for protection -against the failure of distributors to make payments for milk purchased, and (d) other similar benefits. The Market Administrator shall pay to the Sanitary Milk Producers, Inc., hereinafter called 'the Asso- ciation,' such amounts as are deducted pursuant to this section, from pay- ments to producers who are members of the Association, for purposes of securing the aforementioned benefits for such members."

Thus the interests of the organized farmers are left in the hands of their organization; whereas the interests of nonmember producers are the responsibility of the Market Administrator, whose representa- tives make careful investigations to ascertain that they are being served in the most efficient manner. Carrying out the provisions of the license, the Market Administrator collects market information and dissemi- nates it thru a "Market Review" issued monthly and sent to non- member producers. A force of check-testers is employed to supervise weights and tests and so assure to nonmembers accurate weights and butterfat tests by dealers.

While the services of the Milk Market Administrator and those of the Sanitary Milk Producers are similar in some respects, there is no real conflict in their activities. Both agencies issue reliable market information, and both check weights and tests for producers, but they reach entirely different groups of producers, the federal agency sup- plementing rather than supplanting the services of the Sanitary Milk Producers.2 In certain functions, however, the broadening of market

'As amended November 14, 1934, Sec. 2, p. 13.

*See page 136 for objectives of Sanitary Milk Producers.

19351 ST. Louis MILK PROBLEMS 157

outlets, furnishing the initiative in obtaining advances in price when warranted by market conditions, or in preventing unwarranted de- creases in prices to producers the association of producers is not supplemented by government activities.

Price Conferences a Necessary Part of Any Plan

The problem of price is the most controversial problem in a milk market. Under the present federal license, the Dairy Division of the Agricultural Adjustment Administration is given the power to fix minimum prices for each classification of milk to be paid by each distributor in the St. Louis sales area for whole milk received from producers.

It is the writer's belief, however, that an amendment to the federal license providing that conferences between producers, distributors, and consumers should precede any contemplated changes in prices or classi- fications, would be highly desirable. To be effective such conferences would need to include representatives of the above groups, each group having the privilege of assembling and presenting facts to the confer- ence as a whole and participating openly in the discussion. Recom- mendations on which the group as a whole might agree could be sent to the officials of the Agricultural Adjustment Administration as one report. Groups, or even individuals, who failed to agree on any im- portant point would have the privilege of submitting separate reports to the Administration. The federal representatives would thereupon act as arbiters and return their decisions on the suggested changes.

Existing organizations might well be recognized in the selection of representatives to such conferences. The Sanitary Milk Producers are capable of representing producers, the St. Louis Consumers' Council, consumers, and individuals from the principal companies and repre- sentatives of the Small Dealers' Association might represent the dealers.

The good will developed and fostered by such conferences would make for mutual understanding and friendliness, replacing the con- troversies and animosities that have so often characterized the relations existing between the different groups concerned in the whole-milk industry.

158 BULLETIN No. 412 [April,

SUMMARY

1. The present consumption of milk in the St. Louis area (.42 pint daily per person) is the lowest of that in the 14 largest cities in the United States. It is only one-third that recommended as desirable by nutrition authorities and approximately half the amount generally considered the minimum for the maintenance of good health.

2. Increased consumption of milk in the St. Louis area would benefit producers as well as consumers. Were the present per-capita consumption raised to the present per-capita consumption at Boston (.77 pint daily) and the increased sales furnished by dairymen now supplying the market, producers in the St. Louis milkshed would benefit to the extent of about $1,300,000 a year. This would mean an average increase of more than $125 a year gross income to each producer.

3. A major increase in milk consumption would also be of benefit to distributors. If handled by distributors now in the area, such an increase would reduce materially their unit operating costs, enabling them to maintain profitable businesses while narrowing the margin between the prices they pay for milk and those at which they sell it.

4. One of the major causes of the low per-capita consumption of milk in the St. Louis sales area is the low level of consumer incomes coupled with relatively high prices for milk. About one-third of the families in this area average only $800 income annually and another third approximately $1,600 annually. Low incomes have been an es- pecially important deterrent to milk consumption during the past few years, when the price of milk has been relatively high compared with prices of competing foods. Retail prices of milk have averaged 2 cents a quart higher during the past two years than they would have aver- aged had they declined as much proportionately from the 1925-1929 level as the average retail price of all foods at St. Louis has declined.

5. Extremely high summer temperatures, combined with lack of refrigeration, are another basic cause for the low consumption of milk in St. Louis. The average summer temperature at this point is the highest of that in any of the 14 largest cities in the United States, yet nearly two-fifths of the families in the milk sales area have no refriger- ation. The difficulty in keeping milk sweet is probably the most impor- tant reason for nearly one-third of the families in St. Louis not buy- ing milk regularly.

6. The policy in St. Louis of maintaining store prices of milk at a level equal to retail delivery prices, or not more than one cent a quart below them, has tended to discourage store sales in this area. The effect of this policy on per-capita consumption is suggested by com-

79J5] ST. Louis MILK PROBLEMS 159

parison with sales in Boston and New York. These cities, which have the highest percentage of store sales in the country, also are among the highest in per-capita consumption of milk. Furthermore the largest increases in the consumption of milk in these cities have oc- curred when store prices have ranged from 2 to 5 cents a quart lower than retail delivered prices.

7. The basic-surplus price plan adopted in the St. Louis milkshed in 1930 does not appear to have been the cause for the declining prices received by milk producers in this area during 1929-1933. A lowered general price-level, reduced consumers' incomes, and increased milk production as a result of an increase in the number of cattle and lowered feed prices all combined to depress prices to producers.

8. An upward movement in milk prices to St. Louis producers may be expected during the next few years. Such expectation is based, first, on probable increases in the general price-level and in consumers' in- comes, and second, on a prospective decline in milk production in the country as a whole as a result of advancing feed prices and fewer cows.

RECOMMENDATIONS

1. In order to increase the per-capita consumption of milk in St. Louis, it is recommended (1) that the sale of milk thru stores which can furnish adequate refrigeration be encouraged in this city by es- tablishing prices enough lower than retail prices of delivered milk to give consumers the full benefit of the lower cost of distribution; and (2) that the educational program of the Dairy Commission of St. Louis (formerly Dairy Council) be expanded to become a more effec- tive instrument for increasing the consumption of milk and other dairy products.

2. Hauling routes from farms to milk plants in the St. Louis milk- shed should be gradually rearranged in order to reduce excessive costs resulting from the duplication and overlapping of routes. It is esti- mated that farmers in this area could save from $150,000 to $200,000 yearly if routes were rearranged on an economic basis. Because of the importance of such changes to producers, distributors, and haulers, arrangements have been made for a careful analysis of the problem. If consumption of milk were increased at the same time, such an improvement could be effected without throwing any of the present haulers out of employment.

3. Since the basic-surplus plan for paying producers for milk con- tains certain features that tend to effect economies in the marketing

160 BULLETIN No. 412 [April,

of milk and since it is not unlikely that this plan will again be introduc- ed in the St. Louis milkshed within a few years, it is recommended that producers continue to so adjust their feeding and breeding practices as to bring about a more even production of milk thruout the year.

4. Specific regulations should be made as to the conditions under which milk may be produced for manufacturing purposes and under which it may be produced for the fluid market. Producers who have only a few cows, who have high hauling charges, or who cannot afford to meet the quality requirements of this milkshed, should be en- couraged to find more profitable outlets thru condenseries, creameries, or cheese factories.

5. Milk producers should be encouraged to increase their dairy in- come by adopting more efficient production practices. The greater use of dairy herd improvement associations and the keeping of more ade- quate farm accounts are worth wider consideration. The production and sale of milk cows, poultry, eggs, and meat as sidelines is also recommended as a practical means for dairy farmers in this milkshed to increase their incomes.1

6. The programs of the St. Louis Consumers' Council, or St. Louis Dairy Commission, and the Sanitary Milk Producers are basically sound and should be continued. In addition to their present programs, it is recommended that the Dairy Commission and the Sanitary Milk Producers have careful studies made of their activities, in order to ascertain whether their funds are so spent as to be productive of the greatest possible service.

7. The principal functions of the Agricultural Adjustment Admin- istration and the Milk Market Administration in the fluid milk industry are economically sound and should be continued by some agency, fed- eral or other. The services of the federal government in the St. Louis market would be materially strengthened if provision were made in the license for reestablishing price conferences between producers, distri- butors, and consumers.

8. Research studies of important problems confronting producers, distributors, and consumers of milk should be continued in order to furnish a factual basis for determining policies that will be mutually beneficial. Only by the joint efforts of different groups in the in- dustry, thru conclusions reached in such studies, are harmonious so- lutions of problems possible.

'See 111. Agr. Exp. Sta. Buls. 374 and 403.

79J5]

ST. Louis MILK PROBLEMS APPENDIX

161

TABLE 18. POPULATION OF THE MILK SALES AREAS AND CONSUMPTION OF WHOLE

MILK IN 14 CITIES IN THE UNITED STATES HAVING POPULATIONS OF

MORE THAN 500,000 PEOPLE, MAY, 1934"

Area -

Clan I salea

Whole-milk sales of producer- distributors

Total whole-milk sales

Population of sales area

Average daily consumption

Reported

Not reported

Total

Per

capita

Baltimore

Ibt. 74 716 800

46 698 900

Ibi. 6 226 000

5 771 775

Ibt. 6 226 000

lb,. 87 168 800

52 470 675

42 820 088 9 417 745 89 123 831 29 332 954 38 712 583 52 088 102 16 355 924 146 059 890 239 070 970 53 134 842 26 727 068 18 385 895

1 047 500 2 052 000

1 687 600 586 300 4 952 700 1 385 400 2 174 000 2 485 000 761 800 516 000 10 275 400 2 674 100 1 400 800 1 303 100 645 700

thousands of pint* 448.0

1 574.5

1 284.9 282.6 2 674.4 880.2 1 161.7 1 615.1 490.8 372.2 7 173.9 1 594.4 802.0 551.7 339.4

pintt .428

.767

.761

.482 .540 .635 .534 .650 .644 .721 .698 .596 .573 .423 .526

Boston Market Administra- tion

U. S. Bureau of Agri- ' cultural Eco- nomics

Buffalo

7 707 173 84 375 331 21 345 592 37 852 583 39 051 102 14 603 924 136 504 890 239 070 970 53 134 842 15 830 068 18 091 395

1 710 572 3 375 000 6 631 344 244 000 13 037 000 1 460 000 6 825 000

Chicago

1 373 500 1 356 018 616 000

292 000 2 730 000

Cleveland

Detroit

Milwaukee

New York

Philadelphia

Pittsburgh . . .

9 910 000

987 000 294 500

St. Louis

San Francisco

•For sources of population figures see Table 19, page 162. For sources of sales data for each area, see notes on next page.

(Sources of Sales Data in Table 18)

Baltimore. Figures are for Jan.-June, 1934. Class I sales reported: as reported to I. W. Heap, Secretary- Treasurer, Maryland State Dairymen's Association. Clats I sales not reported: estimate of I. W. Heaps. Sales of producer- distributors: estimated same volume as Class I sales which were not reported.

Boston. Market Administration. Class I tales reported: as reported to Einar Jensen, Milk Market Administrator of greater Boston milk sales area, and including sales of producer distributors. Class I sales not reported: estimate of Einar Jensen.

Boston. U. S. Bureau of Agricultural Economics. From monthly milk and cream reports. See 111. Agr. Exp. Sta. Bui. 397, p. 447, Table 26.

Buffalo. Clats I tales reported: as reported to Department of Health. Class I sales not reported: estimate of H. W. Mumford, Jr., Cornell University, Ithaca, New York.

Chicago. Class I sales reported: as reported to Market Administrator of Chicago milk sales area. Clatt I stiles not reported: estimate of Frank C. Baker, Market Administrator. >S'a/c» of producer-distributors: estimated to bear the same relation to reported Class I sales as in the St. Louis milk sales MM.

Cleveland. Clatt I talet reported: as reported to the Dairymen's Cooperative Sales Association, Cleveland, Ohio. Clatt I talet not reported: estimated. Salet of producer-distributors: estimated to bear same relation to Class I sales as in Pittsburgh milk sales area.

Detroit. Clatt I tales reported: as reported to Milk Market Administrator, Detroit milk sales area. Clan I sales not reported: estimate of E. M . Bailey, Milk Market Administrator, Detroit milk sales area. Salet of producer-distributors: estimated to bear same relation to total reported sales as in the St. Louis sales area.

Los Angeles. Class I talet reported (June 19S4): as reported to Milk Market Administrator, Los Angeles milk sales area. Clatt I tales not reported (June 1934): estimate of H. C. Darger, Market Administrator.

Milwaukee. Class I salet reported: as reported to the Department of Health. Class I talet not reported and vKole milk talet of producer-distributors: estimates of C. F. Dineen, Milwaukee Cooperative Milk Producers.

Minneapolis. Clots I tales reported (1933): as reported to Department of Public Health, Minneapolis, and obtained thru courtesy of W. C. Waite, University of Minnesota. Clatt I talet not reported (1933): estimated. Salet of producer- distributors (1933): estimated to bear the same relation to reported Class I sales as in the Milwaukee milk sales area.

New York. From monthly milk and cream reports, U. S. Bureau of Agricultural Economics.

Philadelphia. From monthly milk and cream reports, U. S. Bureau of Agricultural Economics.

Pittsburgh. Clan I talet reported: determined from Dairymen's Cooperative Sales Association's reports, Pitts- burgh, Penn., and from Penn. Agr. Exp. Sta. Tech. Paper 641, p. 5. Three percent of the reported Class I sales for May, 1934, was subtracted from the totals reported in order to allow for sales of Allegheny county dealers outside the county. Class I talet not reported: based on Dairymen's Cooperative Sales Association's percentage of total fluid-milk sales in Allegheny county. Percentage derived from Penn. Agr. Exp. Sta. Tech. Paper 641, p. 11. Salet of producer- distributors: determined from data on number of cows in Penn. Agr. Exp. Sta. Tech. Paper 641, p. 2, and average production per cow in Pennsylvania in 1933 as stated in the U. S. D. A. Yearbook, 1934, p. 629.

St. Louis. Clatt I Halts reporttd: as reported to St. Louis Milk Market Administrator under U. S. License No. 35. Sales of producer-distributors: based on sales of 95 producer-distributors with average sales of 100 pounds of milk daily.

San Francisco. Figures are for 1932. See 111. Agr. Exp. Sta. Bui. 397, Table 17, p. 450.

162

BULLETIN No. 412

\_April,

TABLE 19. POPULATION OF MILK SALES AREAS OF 14 CITIES IN THE UNITED STATES HAVING MORE THAN 500,000 PEOPLE, 1934

Population*

Areat

1920

1930

Percent increase in total popu- lation 1920-1930

Nonfarm 1934

Total

Farm

Nonfarm

Baltimore

. 928 636

1 065 892 1 998 867

45 065 2 029

1 020 827 1 996 838

14.8 15.6

1 047 500 2 052 000

1 687 600 586 300 4 952 700 1 385 400 2 174 000 2 485 000 761 800 516 000 10 275 400 2 674 100 1 400 800 1 303 100 645 700

Boston Market Administration

. 1 729 772

U. 8. Bureau of Agricultural Economics

Buffalo

506 775

573 076 4 682 034 1 320 974 2 114 113 2 416 390 718 149 499 509

13.1

32.7 27.6 67.2 114.7 34.4 25.0

Chicago

. 3 575 518

4 743 707 1 334 439 2 129 904 2 474 073 725 263 499 509

61 673 13 465 15 791 57 683 7 114 None

. 1 046 049

Detroit

. 1 274 185

Los Angeles

539 449

Minneapolis

399 698

New York

Pittsburgh

. 1 185 808

1 374 310 1 276 309

11 740 18 218

1 362 570 1 258 091

15.9 20.2

St. Louis

. 1 061 610

San Francisco . . . .

•Data are from 1930 U. S. Census (Vol. 1, Agriculture; and Vol. 6, Population). According to estimates of the U. S. Bureau of the Census, the population of the United States increased only 44.2 percent as rapidly during the latter part of the decade 1920-1930 as it did for the decade as a whole. Hence population data since 1930 have been inter- polated on a basis of 44.2 percent of the average annual increase in the respective sales areas from 1920 to 1930.

bThe sales areas of the various cities listed here are as follows:

Baltimore. Includes Harford, Baltimore, Howard, Anne, Arundel (less villages of Churchton and Fair Haven), Carroll (less villages of Union Mills, Taneytown, Keymar, Union Bridge, Uniontown, Newton, Marlboro, and Forestville) .

Boston. Market Administration. Includes the towns of Marblehead, Swampscott, Saugus, and Nahant in Essex county; Wakefield, Reading, Winchester, Stoneham, Lexington, Arlington, Belmont, and Watertown in Middlesex county; Brookline, Wellesley, Needham, Dedham, Milton, Braintree, and Weymouth in Norfolk county; Winthrop in Suffolk county; and the cities of Beverly, Boston, Cambridge, Chelsea, Everett, Lynn, Maiden, Medford, Melrose, Newton, Peabody, Quincy, Revere, Salem, Somerville, Waltham, and Woburn. U. S. Bureau of Agricultural Economic! (nonfann 1934 population) is explained in 111. Agr. Exp. Sta. Bui. 397, Table 26, p. 447. Population as interpolated for 1934 is explained in footnote a above.

Buffalo. Based on milk sales area as determined by Herbert W. Mumford, Jr., Cornell University, Ithaca, N.Y., unpublished data.

Chicago. The Chicago milk sales area includes the counties of Lake, Cook, DuPage, Will (less the villages of Torino, Ouster Park, and Braidwood), Kane (less the village of Burlington), and Kendall (less the cities or villages of Piano, Millington, Newark, and Lisbon) all in Illinois; Lake and Porter counties in Indiana; and the cities and villages of McHenry, Ridgefield, Crystal Lake, Algonquin, Huntley, Minooka, Manteno, Grant Park, Solitt, Delmar, and Momence in Illinois, as well as the cities and villages of Michigan City, Otis, and Westville in Indiana.

Cleveland. The Cleveland milk sales area includes Cuyahoga county; the townships of Willoughby, Kirtland, Mentor, Painesville and Concord in Lake county; Chester, Russell, and Bainbridge in Geauga county; Twinsburg and Northfield in Summit county; Columbia, Eaton, Carlisle, Ridgeville, Elyria, Amherst, Avon, Sheffield, and Black River in Lorain county all in the state of Ohio.

Detroit. The Detroit milk sales area includes Wayne county (less Sumpter and Huron townships) ; the townships of Highland, White Lake, Water Ford, Pontiac, Troy, Bloomfield, West Bloomfield, Commerce, Novi, Farmington, Southfield, and Royal Oak in Oakland county; Warren, Erin, Clinton, Macomb, Harrison, and Chesterfield in Macomb county; Ira, Clay, and Cottrelville in St. Clair county; the cities of Pontiac, Royal Oak, Farmington, Ferndale, Pleasant Ridge City, East Detroit City, Mt. Clemens, and Marine City all in Michigan. Population for Detroit was inter- polated at 44.2 percent of the average annual increase in the United States during 1920-1930.

Los Angeles. The Los Angeles milk sales area includes the counties of Los Angeles and Orange; the cities and villages of Ontano, Chino, Cajon, Rialto, San Bernardino, Colton, Highland, Redlands, Pine Knot, Summit, Victorville, Oro Grande, Lucerne Valley, Barstpw, Daggett, and Ludlow in San Bernardino county; and the cities and villages of Corona, Arlington, Riverside, Pervis, Elsinore, Temscula, Lakeview, San Jacinto, Hermit, Beaumont, Banning, Indo, Coachella, and Thermal in Riverside county. Population for Los Angeles was interpolated at 44.2 percent of the average annual increase in the United States during 1920-1930.

Milwaukee. The Milwaukee milk sales area consists of Milwaukee county, Wisconsin.

Minneapolis. The Minneapolis milk sales area consists of the cities and villages of Brooklyn Center, Columbia Heights, Crystal, Deep Haven, Edina, Excelsior, Golden Valley, Hopkins, Island Park, Long Lake, Minneapolis, Minne- topka Beach, Morning Side, Mound, Osseo, Richfield, Robbins Dale, St. Louis Park, Tonka Bay, and Wayzctta, in the state of Minnesota.

New York. See 111. Agr. Exp. Sta. Bui. 397, Table 25, p. 447.

Philadelphia. See 111. Agr. Exp. Sta. Bui. 397, Table 25, p. 447.

Pittsburgh. The Pittsburgh milk sales area consists of Allegheny county, Pennsylvania.

St. Louis The St. Louis milk sales area is composed of the following governmental units in the state of Missouri: the city of St. Louis; the townships of Carondelet, St. Ferdinand, and Central of St. Louis county and St. Charles in St. Charles county. In the state of Illinois the area is composed of the cities of Alton, Belleville, East St. Louis; the town- ships of Godfrey, Wood River, Chouteau, Venice, Nameoki, and Collinsville in Madison county, and Canteen, Caseyville, Centerville, St. Clair, Sugar Loaf, Stookey, Millstadt, and O'Fallon in St. Clair county.

1935]

ST. Louis MILK PROBLEMS

163

TABLE 20.-

-AVERAGE FAMILY INCOMES AND PER-CAPITA CONSUMPTION OF MILK BY CENSUS DISTRICTS, ST. Louis, 1934"

District

Total families

Number of families with incomes of

Percentages of families with incomes of

Weighted average income6

Daily per- capita consump- tion of

milk'-

Under $1230

$1230 to $2049

$2050 and over

Under $1230

$1230 to $2049

$2050 and over

1...

7 176

2 642 353 777 902 577 1 898 1 351 863 2 548 2 226 5 210 769 1 184 220 2 109 1 062 978 4 246 1 112 4 682 7 165 6 059 10 821 5 108 4 894 8 144

77 900

906 266 124 114 113 7 297 3 386 586 2 142 4 509 5 202 1 591 911 973 4 865 4 484 4 025 2 665 1 379 1 562 2 240 1 126 3 662 3 577 322 1 391

64 418

2 628 2 602 1 811 1 535 7 941 5 851 3 644 706 1 829 3 738 2 493 5 838 585 2 307 5 013 5 528 5 136 1 148 4 269 702 1 188 586 2 389 2 045 264 761

72 537

36.8 8.4 20.9 25.4 6.0 12.6 16.1 40.0 39.1 21.2 40.4 9.4 44.2 6.3 17.6 9.6 9.6 52.7 16.4 67.4 67.6 78.0 64.1 47.6 89.3 79.1

36.3

26.6 30.0 30.3 31.4 11.6 48.5 40.4 27.2 32.8 43.1 40.3 19.4 34.0 27.8 40.6 40.5 39.7 33.1 20.4 22.5 21.4 14.5 21.7 33.3 5.9 13.5

30.0

36.6 61.6 48.8 43.2 82.4 38.9 43.5 32.8 28.1 35.7 19.3 71.2 21.8 65.9 41.8 49.9 50.7 14.2 63.2 10.1 11.0 7.5 14.2 19.1 4.8 7.4

33.7

$2 075 2 815 2 452 2 302 3 255 2 320 2 384 1 970 1 883 2 184 1 696 3 000 1 715 2 918 2 338 2 568 2 582 1 492 2 779 1 287 1 307 1 148 1 396 1 631 999 1 136

$2 022

pint .42 .52 .52 .45 .53 .48 .41 .42 .41 .41 .28 .48 .41 .56 .49 .56 .48 .40 .54 .38 .19 .39 .36 .40 .24 .38

.423

2

. . 4 221

3

3 712

4

.. 3 551

5

.. 9 631

6

.. 15 046

7

. . 8 381

8

.. 2 155

9

6 519

10

. . 10 473

11

.. 12 905

12

.. 8 198

13

.. 2 680

14

.. 3 500

15

.. 11 987

16....

.. 11 074

17

.. 10 139

18

8 059

19

.. 6 760

20

6 946

21

. . 10 593

22

. . 7 771

23

. . 16 872

24

. . 10 730

25

.. 5 480

20

. . 10 296

Total

.. 214 855

•Determined from a pamphlet published by the research department of the St. Louis Globe-Democrat entitled "Metropolitan St. Louis Population and Families Divided by Income Groups for Census Tracts," based on the 1930 U.S. Census.

bTo obtain the weighted average income for each district the average income for each income-group was multiplied by the number of families in each income-group.

°From unpublished data of a study made under the direction of Mrs. M. C. Harrington, of the St. Louis District Dairy Council, in cooperation with the St. Louis Department of Public Health. The average per-capita consumption of milk for the 8,136 families included in this study was .48 pint daily, compared with .423 pint daily for the market (Table 1). Consumers' statements were corrected for exaggeration by multiplying the reported consumption for each

423 district by , or 88.1 percent.

164

BULLETIN No. 412

{.April,

TABLE 21. RACIAL POPULATION ANALYSIS BY CENSUS DISTRICTS, ST. Louis, 1930

Census district

Total population*

Area in square milesb

Population

per square

mile

White*

Negro*

Total

white and

Negro0

Percent white is of total

(thoutandt)

1 26814 3.3 8.1 26117 680 26797 97.5

2 15139 1.6 10.1 15137 2 15139 100.0

3 14479 3.0 4.8 14469 10 14479 99.9

4 13376 1.6 8.4 13281 83 13364 99.4

5 35712 1.8 19.8 35247 424 35671 98.8

6 58588 2.8 20.9 58306 271 58577 99.5

7 31923 3.0 10.6 31908 13 31921 100.0

8 8387 2.7 3.1 8209 162 8371 98.1

9 23576 2.1 11.2 23193 317 23510 98.7

10 38583 1.6 24.1 37025 1540 38565 96.0

11 51806 1.9 27.3 29413 22352 51765 56.8

12 33425 1.6 20.9 32899 458 33357 98.6

13 16014 1.0 16.0 15419 593 16012 96.3

14 11670 2.2 5.3 11661 8 11669 99.9

15 43543 3.7 11.8 43251 291 43542 99.3

16 38766 1.9 20.4 38707 44 38751 99.9

17 37473 1.6 23.4 37365 82 37447 99.8

18 30546 1.9 16.1 22936 7587 30523 75.1

19 27648 1.1 25.1 25898 1597 27495 94.2

20 26081 .9 29.0 24648 1406 26054 94.6

21 44678 1.4 31.9 11916 32655 44571 26.7

22 31126 1.3 23.9 19101 11853 30954 61.7

23 62137 2.1 29.6 60729 1150 61879 98.1

24 37400 1.5 24.9 37373 .22 37395 99.9

25 24275 1.4 17.3 15027 8972 23999 62.6

26 38795 1.8 21.6 37644 1008 38652 97.4

Total 821960 50.7 16.3 726879 93580 820459 88.6

•From U. S. Census, 1930.

''Approximately 10.3 square miles of nonpopulated areas were subtracted from the total area of St. Louis.

cThe population of other races numbering 1,501 individuals was not included in the totals by Census districts.

TABLE 22. INDEXES OF AVERAGE RETAIL PRICES OF ALL FOODS IN ST. Louis

BY MONTHS, 1925-1934" (Same month, 1925-1927 = 100)

Year

Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. NOT. Dec. Average

1925. 1926. 1927. 1928. 1929. 1930. 1931. 1932. 1933. 1934.

96 103 100

97

96 104 102 97 99 100 82 68 57 70

103 99 97

97 104

100 80

104 102 98 100 97 78 64 60 68

97 102 101

102 100 98 97 103 90 77 63 68 70

102

104 93 78 64 71 73

101 101

103 93 75 63 69 76

101 101 98 97 100 90 74 61 66 73

103 101 96

102 101 97 97 98 84 70 60 64 72

102 99 97

100 94 77 64 63 71

•Tabulated from current reports of the U. S. Bureau of Labor Statistics.

1935] ST. Louis MILK PROBLEMS 165

TABLE 23. AVERAGE RETAIL PRICES OF EVAPORATED MILK IN ST. Louis, BY MONTHS, 1925-19348

Year

Jan.

Feb.

Mar.

April

May

June July Aug.

Sept.

Oct.

Nov.

Dec.

Average

1925-1927... 1925...

. 9.37 . 9.1

9.37

9.2 9.5 9.4 9.6 9.8 8.8 9.0

9.30

9.2 9.4 9.3 9.6 9.8 8.7 8.2

9.40

9.2 9.5 9.5 9.0 9.2 8.7 8.1

(Cento per 14]>$-ounce can) 9.50 9.50 9.63 9.63

9.2 9.3 9.5 9.6 9.4 9.4 9.4 9.4 9.9 9.8 10.0 9.9 9.0 9.0 9.0 9.3 9.0 9.0 9.0 8.8 8.7 8.7 8.7 8.7 81 81 8 3 7 :>

9.57

9.5 9.3 9.9 9.6 8.8 9.2 7 5

9.60

9.6 9.3 9.9 9.8 8.7 9.2 7 6

9.67

9.7 9.4 9.9 9.8 9.1 8.7 7 5

9.63

9.7 9.3 9.9 9.8 9.1 8.6 7 2

9.51

9.40 9.41 9.73 9.44 9.18 8.79 8 02

1926

9 6

1927

. 9 4

1928 ,

. 9.8

1929

9 9

1930 . . .

8 8

1931

. 9.1

1932

7.2

7.1 6.2 6.5

98 101 100 102 105 94 96 76 66 69

6.8 5.1 65

99 101 100 103 105 94 88 73 55 70

6.8 6.6 6.2 5.5 5.3 5.1 6.3 6.4 6.7 6.8 6.5 6.5 6.4 6.4 6.4

(Indexes: tame month 19t5-19t7 = 100) 98 97 98 99 100 101 99 99 98 98 101 104 103 104 103 96 95 95 94 97 98 95 95 94 91 93 92 92 90 90 86 85 85 86 78 72 70 65 57 55 54 66 67 70 71 69 68 67 67 67

5.3 6.5 6.4

99 97 103 100 92 96 78 55 68 67

5.2 6.4 6.3

100 97 103 102 91 96 79 54 67 66

5.3 6.5 6.3

100 97 102 101 94 90 78 55 67 65

6.2 6.5 6.4

101 97 103 102 94 89 75 64 68 66

6.13 6.23 6.42

99 99 102 99 97 92 84 64 65 68

1933 ,

. 6 2

1934

. 6.5

1925 .

97

1926

102

1927

. 100

1928 ... .

105

1929

. 106

1930

94

1931

97

1932

. 77

1933 .

66

1934

69

•From current reports of U. S. Bureau of Labor Statistics. Prices from January, 1925 ,to December, 1931, were converted from a 1 frounce can to a 14>£-ounce can by multiplying by .90625.

TABLE 24. DIFFERENCES BETWEEN THE RETAIL PRICES PER QUART OF WHOLE MILK

AND PER 14J^-OUNCE CAN OF EVAPORATED MlLK, ST. LOUIS,

BY MONTHS, 1925-1934 (Cents per unit)

Year

Jan.

Feb.

Mar.

Apr.

May

June

July

Aug.

Sept.

Oct.

Nov.

Dec.

Average

1925 .

3 9

3 8

3 8

3 8

3 8

3 7

3 5

3 4

3 5

3 4

3 3

3 3

3 6

1926

3 4

3 5

3 6

3 5

3 6

3 6

3 6

3 7

3 7

3 6

3 7

3 6

1927

3 6

3 6

3 7

3 5

3 1

3 2

3 0

3 1

3 1

3 1

3 1

3 1

3 3

1928

. 3 2

3 4

3 4

4 0

4 0

4 0

4 0

3 7

3 4

3 2

3 2

3 2

3 g

1929....

. 3.1

3 2

3 2

3 8

4 0

4 0

4 0

4 2

4 2

4 3

3 9

3 9

3 8

1930. . . .

4 2

4 2

4 3

4 3

4 3

4 3

4 3

4 3

3 8

3 8

4 3

3 4

4 i

1931...

,. 29

3 0

3 8

3 9

3 9

3 9

3 7

4 5

3 5

3 4

3 5

3 8

3 6

1932. ..

3 8

3 9

3 2

3 2

3 4

3 8

4 5

4 7

4 7

4 8

4 7

3 8

4 0

1933

3 8

3 8

4 9

4 9

3 7

3 6

3 3

3 2

3 5

3 6

3 5

4 5

3 9

1934...

. 45

45

45

4.5

45

46

4 6

46

46

47

47

46

46

166

BULLETIN No. 412

{.April,

TABLE 25. AVERAGE FARM PRICES OF TWELVE FARM COMMODITIES IN THE ILLINOIS PART OF THE ST. Louis MILKSHED, BY MONTHS, 1925-1934*

Year

Jan.

Feb.

Mar.

Apr. May June July Aug.

Sept.

Oct.

Nov.

Dec. Average

BEEF CATTLE

(Dottart per 100 pounds)

1925-1929....

. 7.73

7.87

8.04

8.07

8.38 8.28 8.47

8.84

8.37

8.48

8.42

8.45

8.28

1925....

. 6.02

6.76

7 65

7.22

7.32 7.74 7.62

9.18

7.44

6.91

7.29

7.12

7.36

1926

. 7.20

7.36

6 92

6.68

7.47 7.34 7.18

7.25

6.88

7.08

6.94

7.02

7.11

1927

. 6.83

7.10

7 09

7.65

7.34 7.30 7.23

7.88

7.51

8.27

8.66

9.42

7.69

1928

. 8.85

8.84

8 96

8.84

9.40 9.14 9.75

9.70

10.52

10.14

9.86

9.48

9.46

1929

. 9.76

9.29

9 58

9.94 10.38 9.89 10.58

10.22

9.52

10.00

9.36

9.20

9.81

1930

. 9.26

9.42

« 47

9.30

9.06 8.90 8.08

6.70

7.72

8.00

7.57

7.40

8.41

1931

. 7.04

6.26

6 74

6.42

6.03 5.95 5.58

5.45

5.80

5.66

5.45

5.20

5.96

1932

. 4.74

4.42

4 58

4.62

4.46 4.42 5.53

5.10

5.04

4.76

4.38

4.18

4.69

1933

. 3.96

3.79

3 70

3.86

4.51 4.17 4.62

4.18

4.24

4.16

3.90

3.47

4.05

1934

. 3.58

4.08

4.28

4.18

4.56 4.90 4.74

4.68

5.18

4.83

5.05

4.86

4.58

(Indexes:

tame month 19i5-l9S9

= 100)

1925....

78

86

95

89

87 93 90

104

89

81

87

84

89

1926

. 93

94

86

83

89 89 85

82

82

83

82

83

86

1927

. 88

90

88

95

88 88 85

89

90

98

103

111

93

1928

. 114

112

111

110

112 110 115

110

126

120

117

112

114

1929

. 126

118

119

123

124 119 125

116

114

118

111

109

118

1930

. 120

120

118

115

108 107 95

76

92

94

90

88

102

1931

. 91

80

84

80

72 72 66

62

69

67

65

62

72

1932

. 61

56

57

57

53 53 65

58

60

56

52

49

57

1933

. 51

48

46

48

54 50 55

47

51

49

46

41

49

1934

. 46

52

53

52

54 59 56

53

62

57

60

58

55

BUTTERFAT

1925-1929. . . ,

. 43

41.2

43

41.2

39.8 38.7 38 4

39.4

40.6

42.4

42.8

43.6

41.2

(Centt per pound)

1925....

38

34

40

38

36 36 37

38

39

44

43

44

39

1926

. 43

40

41

38

37 38 36

36

39

39

42

44

40

1927

. 43

44

44

44

42 37 37

36

39

41

44

44

41

1928

. 46

44

43

42

42 40 40

41

44

44

44

46

43

1929

. 45

44

47

44

42 42 42

46

42

44

41

40

43

1930

. 35

33

32

34

33 30 30

34

37

34

33

28

33

1931

. 25

23

27

26

19 20 20

23

24

29

27

25

24

1932

. 21

19

19

16

15 13 14

17

16

17

17

20

17

1933

. 18

16

14

15

19 18 22

16

17

18

18

16

17

1934

.. 14

22

22

20

20 22 20

24

22

21

25

25

21

(Indexes:

same month 1913-19*9

= 100)

1925....

88

82

93

92

90 93 96

96

96

104

100

101

80

1926

. 100

97

95

92

93 98 94

91

96

92

98

101

97

1927

. 100

107

102

107

106 96 96

91

96

97

103

101

99

1928

. 107

107

100

102

106 103 104

104

108

104

103

106

104

1929

. 105

107

109

107

106 108 109

117

103

104

96

92

104

1930

.. 81

80

74

82

83 78 78

86

91

80

77

64

80

1931

. 58

56

63

63

48 52 52

58

59

68

63

57

58

1932

. 49

46

44

39

38 34 36

43

39

40

40

46

41

1933

.. 42

39

33

36

48 47 57

41

42

42

42

37

41

1934

.. 33

53

61

48

50 57 52

61

54

50

58

57

51

•For Illinois districts South-Southwest and Southwest, as obtained from Illinois State Department of Agriculture.

1935}

ST. Louis MILK PROBLEMS

167

TABLE 25. FARM PRICES Continued

Year

Jan.

Feb.

Mar.

Apr.

May June July

Aug.

Sept.

Oct.

Nov.

Dec. i

Lverage

CHICKENS

1925-1929.... 1925...

. 20.2 18

21.4 20

21.

2 23 22

(Cents per pound) 23 21.2 22.4

21 20 21

21.2 20

21.2 21

20 19

19.4 19

19.4 20

21.13

20

1926

21

22

22

24

24 24 24

22

21

20

19

19

22

1927

. 20

22

22

22

25 18 22

18

19

19

19

19

20

1928 .

19

20

19

22

21 20 21

22

23

21

21

21

21

1929

23

23

25

24 24 24

24

22

21

19

18

22

1930

19

20

?0

21

18 18 16

16

18

16

15

14

18

1931

15

14

1ft

16

14 16 14

16

16

13

13

13

15

1932

13

12

1?

12

11 10 10

11

10

09

09

08

11

1933

. 08

09

08

09

09 08 09

09

08

08

07

06

08

1934

08

09

10

10

10 10 11

11

12

10

10

10

10

1925...

89

93

94

(Indexet: 95

tame month 19tS-19t9 91 94 94

= 100) 94

99

95

98

103

95

1926 .

104

103

104

104

104 113 107

104

99

100

98

98

104

1927

99

103

104

95

108 84 98

84

90

95

98

98

95

1928

94

93

90

95

91 94 94

104

108

105

105

105

100

1929.

114

107

108

108

104 113 107

113

104

105

98

92

104

1930

94

93

94

91

78 84 71

75

84

80

77

72

85

1931

. 74

65

75

70

60 75 62

75

75

65

67

67

71

1932 . .. .

64

56

Ifi

52

48 47 44

52

47

45

46

41

52

1933

40

42

38

39

39 38 40

42

38

40

36

31

38

1934

. 40

42

47

43

43 47 49

52

57

50

52

52

47

EGGS*

1925-1929.... 1925..

. 38.2 49

30 34

23

22.8 24

(Cents per dozen) 23.6 23.2 24

25 26 26

25.6 27

29.8 30

35.4 35

38 27

44.8 46

29.8 31

1926

36

26

n

25

25 25 24

25

29

39

43

46

30

W27 ...

37

30

?0

20

19 16 20

22

28

35

40

44

28

1928

. 38

28

23

25 24 24

26

30

32

37

42

29

1929

. 31

32

?7

22

24 25 26

28

32

36

43

46

31

1930

40

34

22

19 18 16

18

23

24

30

26

24

1931

. 22

12

17

15

12 13 13

14

16

20

25

24

17

1932....

14

11

8

8

10 8 9

13

15

21

26

30

14

1933

19

9

8

8

10 8 10

10

13

18

22

20

13

1934

16

14

13

12

12 12 11

14

20

20

26

26

16

1925

128

113

100

(Indexet: 105

tame month 1915-1919 106 112 108

= 100) 105

101

99

71

103

104

1926. . . .

94

87

100

110

106 108 100

98

97

110

113

103

101

1927 1928...

. 97 99

100 93

87 9ft

88 101

81 69 83 106 103 100

86 102

94 101

99 90

105 97

98 94

94 97

1929

, . 81

107

117

96

102 108 108

109

107

102

113

103

104

1930 ..

105

113

87

96

81 78 67

70

77

68

79

58

81

1931

. 58

40

74

66

51 56 54

55

54

56

66

54

57

1932 1933

. 37 50

37 30

35

35 35

42 34 38 42 34 42

61

39

50 44

59 51

68 58

67 45

47 44

1934

42

47

56

53

51 52 46

55

67

56

68

58

54

•For Illinois districts South-Southwest and Southwest, as obtained from the Illinois State Department of Agri- culture.

168

BULLETIN No. 412

[April,

TABLE 25. FARM PRICES Continued

Year

Jan.

Feb.

Mar.

Apr.

May June July

Aug.

Sept.

Oct.

NOT.

Dec.

Average

CORN-

1925-1929. . . 1925....

.. 75.4 . . 108

78.0

107.5

79.2 107.5

79.9 97.5

(Cents per bushel) 84.8 89.6 89.9

107.5 108.5 99.5

92.4 100 5

90.4

92

81.9 72.5

69.1 63.5

66.8 62

81.5 93.9

1926

.. 63 5

63

59 5

60

61 5 62 64

73 5

71

71

59 5

56

63 7

1927

. . 56

58

57.5

58

65 86.5 90 5

95

96 5

87 5

76

73

75 0

1928 ..

.. 72

75 5

84

94

104 5 103 5 103 5

98

96 5

86 5

69 5

72 5

88 3

1929

. . 77.5

86

87 5

90

85 5 87 5 92

95

96

92

77

70 5

86 4

1930

. . 70

68.5

67

72

71.5 73 71.5

86

89

77.5

64.5

63 5

72 8

1931

. 60

60

57

55 5

55 53 53

49 5

38

28 5

30

27

47 2

1932

. . 26.5

25

24.5

23

22.5 22 5 22

23

22

17 5

15 5

15

21 6

1933

. . 15.5

16

16

24.5

36 38.5 52.5

48.5

45.5

37

39

40.5

34.1

1934

. . 42

45

44 5

45 5

45 5 51 5 55

70

77

76

75 5

91 5

59 9

1925....

. 143

138

136

(Indexes: 122

same month 1985-1929 127 121 111

= 100) 109

102

88

92

93

125

1926

.. 84

81

76

75

73 69 71

80

78

87

86

84

78

1927

. . 74

74

73

73

77 96 101

103

107

107

110

109

93

1928

.. 95

97

106

118

123 116 115

106

107

106

101

108

108

1929 ..

103

110

110

113

101 98 102

103

106

112

111

106

106

1930

. . 93

88

85

90

84 81 80

93

98

95

93

95

89

1931

.. 80

77

72

69

65 59 59

54

42

35

43

40

58

1932 ...

35

32

31

29

26 25 24

25

24

21

22

22

26

1933

.. 21

20

20

31

42 43 58

52

50

45

56

61

42

1934

.. 56

58

56

57

54 57 61

76

85

93

109

137

73

HOGS

1925-1929. . .

.. 9.65

10.14

10.77

(

10.58

Dollars per 100 pounds) 10 54 10 41 11.13

11.37

11.54

10.95

9.87

9.43

10 53

1925 ...

. 9 56

9 88

12.50

11 96

10 96 11 02 12 58

12.94

12.28

11.62

10 85

10 68

11 40

1926

. . 11.28

12.39

12.12

11.98

12.54 13.38 13.34

12.40

13.00

12.69

11.74

11.42

12.36

1927

. . 11 12

11 53

11 22

10 67

9 67 8 34 8 93

9 89

10 37

10 73

9 39

8 19

10 00

1928

.. 8.04

7.69

7.56

7.89

9 21 9 15 10 02

10.57

11.92

10.17

8.59

8.17

9.08

1929

. . 8.26

9.20

10.44

10.39

10.34 10.18 10.76

11.05

10.12

9.54

8.76

8.70

9.81

1930

9 07

9 81

10 10

9 70

9 39 9 52 8 88

8 90

9 97

9 37

8 65

7 67

9 25

1931

. . 7.57

7.29

7.27

7.18

6.69 5.94 6.66

6.83

5.58

4.92

4.52

3.96

6.20

1932

. 3.92

3.56

4.10

3.66

3.02 2.90 4.60

4.26

3.95

3.38

3.19

2.83

3.61

1933

. . 2 81

3 08

3 34

3 25

4 27 4 06 4 20

3 91

3 87

4 38

3.72

2.88

3 65

1934

.. 3.09

4.11

4.04

3.57

3.16 3.58 4.06

4.94

6.20

5.30

5.30

5.45

4 40

1925.

99

97

116

(Indexes: 113

tame month 19t5-19t9 104 106 113

= 100) 114

106

106

110

113

108

1926

. . 117

122

113

113

119 129 120

109

113

116

119

121

117

1927...

. 115

114

104

101

92 80 80

87

90

98

95

87

95

1928

. 83

76

70

75

87 88 90

93

103

93

87

87

86

1929

.. 86

91

97

98

98 98 97

97

88

87

89

92

93

1930

94

97

94

92

89 91 80

78

86

86

88

81

88

1931

.. 78

72

68

68

63 57 60

60

48

45

46

42

59

1932....

41

35

38

34

29 28 41

37

34

31

32

30

34

1933

. 29

30

31

31

41 39 38

34

34

40

38

31

35

1934

32

41

38

34

30 34 36

43

54

48

54

58

42

•For Illinois districts South-Southwest and Southwest, as obtained from Illinois State Department of Agriculture.

1935]

ST. Louis MILK PROBLEMS

169

TABLE 25. FARM PRICES Continued

Year

Jan.

Feb.

Mar.

Apr.

May June July

Aug.

Sept.

Oct.

Nov.

Deo.

Average

LOOSE ALFALFA HAY«

(DoUan per ton)

1925-1929

18.18

18.58

18.04

17.98

17.92 17.22 16.57

16.51

16.83

16.52

17.69

17.88

17.49

1925...

15.80

16.44

14.00

15.00

15.50 15.00 13.25

15.12

16.60

16.00

18.38

19.20

15.86

1926

18.48

18.29

19.64

20.38

20.65 20.30 18.80

19.50

19.26

19.18

19.50

20.62

19.55

1927

21.86

21.88

21.00

20.00

19.99 1850 17.40

16.74

16.66

16.47

16.04

15.50

18.50

1928

17.22

16.52

16.66

16.25

16.46 16.66 16.98

16.20

16.46

16.41

19.04

18.06

16.91

1929

17.52

19.79

18.92

18.28

17.01 15.62 16.44

14.98

15.16

14.54

15.50

16.00

16.65

1930

15 88

16.00

15.44

1603

15.36 15.00 15.50

18.72

19.60

19.41

20.00

20.50

17.29

1931

18.88

18.93

18.09

18.44

17.72 12.97 10.58

11.12

10 96

11.16

11.28

11.61

14.31

1932

11.78

10.04

10.36

10.37

9.80 8.24 7.04

8.61

6.55

5.90

7.65

6.55

8.57

1933

7.55

7.05

6.80

6.55

7.20 6.78 8.65

9.30

10.55

10.95

11.55

11.25

8.68

1934

11.50

12.60

12.40

14.00

13.30 13.30 14.40

15.90

17.10

17.25

17.60

19.20

14.88

(Indextt:

tame month 19tS-19t9

= 100)

1925...

87

88

78

83

86 87 80

92

99

97

104

107

91

1926

102

98

109

113

115 118 113

118

114

116

110

115

112

1927

120

118

116

111

112 107 105

101

99

100

91

87

106

1928

95

89

92

90

92 97 102

98

98

99

108

101

97

1929

96

106

105

102

95 91 99

91

90

88

88

89

95

1930

87

86

86

89

86 87 94

113

116

117

113

115

99

1931

104

102

100

103

99 75 64

67

65

68

64

65

82

1932

65

54

57

58

55 48 42

52

39

36

43

37

49

1933

42

38

38

36

40 39 52

56

63

66

65

63

50

1934

63

68

69

78

74 77 87

96

102

104

99

107

85

MILK COWS

(Dollar » per head)

1925-1929

72.86

74.33

76.58

74.77

75.58 76.79 75.63

76.76

78.72

81.41

81.87

79 90

77.10

1925....

58.89

59.25

67.08

59.56

55.00 62.25 58.00

63.76

60.27

63.58

65.25

61.22

61.48

1926

62.41

67.48

65.34

67.77

67.88 64.72 70.16

63.64

66.82

66.98

66.11

65.76

66.26

1927

65.99

68.44

68.50

69.00

70.00 68.50 68.00

70.50

74.00

79.00

82.50

82.50

72.24

1928

81.50

81.50

82 50

83.00

86.00 93.00 86.50

90.50

91.00

94.50

93.00

92.50

87.96

1929

95.50

95.00

99.50

94.50

99.00 95.50 95.50

95.50

101.50

103.00

102.50

97.50

97.88

1930

88.50

91.50

78.50

82.00

74.50 70.50 71.50

56.00

65.50

69.50

65.00

64.50

73.12

1931

54.50

50.50

51.50

44.50

50.00 48.50 46.00

44.94

43 53

42.78

45.00

44.24

47.16

1932

42.28

35.44

40.03

37.60

36.64 35.38 33.64

36.09

31.30

36.50

33.25

30.50

35.72

1933

32.75

31.15

31.75

32.05

35.10 35.60 36.25

34.05

33.60

31.20

29.70

29.60

32.73

1934

29.50

32.15

31.60

31.95

31.90 29.50 28.80

31.10

33.40

34.85

33.15

32.05

31.66

(Indent:

tame month 19tS-19t9

= 100)

1925...

81

80

87

80

73 81 77

83

77

78

80

77

79

1926

86

91

85

91

90 84 93

83

85

82

81

82

86

1927

90

92

89

92

•93 89 90

92

94

97

101

103

94

1928

112

110

108

111

114 121 114

118

116

116

114

116

114

1929

131

128

130

126

131 124 126

124

129

127

125

122

127

1930

122

123

102

110

99 92 95

73

83

85

79

81

95

1931

74

68

67

60

66 63 61

59

55

53

55

55

61

1932

58

48

52

50

48 46 44

47

40

44

41

38

46

1933

44

42

41

43

46 46 48

44

43

38

36

37

42

1934

40

43

40

43

42 38 38

41

42

43

40

40

41

•For Illinois districts South-Southwest and Southwest, as obtained from the Illinois State Department of Agri- culture.

170

BULLETIN No. 412

{April,

TABLE 25. FARM PRICES Continued

Year

Jan.

Feb.

Mar.

Apr.

May June July

Aug.

Sept.

Oct.

Nov.

Dec.

Average

OATS'

(Cent* per bushel)

1925-1929...

. 48.2

50.0

50.7

49.9

48.0 49.0 45.8

40.3

40.8

43.1

42.4

44.7

46.1

1926....

. 59

58.5

58.5

51

45.5 49 45

41

39

40

38

41.5

47.1

1926

. 42.5

44

42.5

43.5

41.5 41.5 39

37.5

38

40

40.5

42

41.0

1927

. 43

43.5

45 5

45

45 46.5 47.5

45

46

48

48

49.5

46.0

1928

. 51

56

60

62

62 65 53

35

36

40.5

41

44.5

50.5

1929

. 45.5

48

47

48

46 43 44.5

43

45

47

44.5

46

45.6

1930

. 43

44.5

45

46

43.5 42 34

37

40.5

39.5

36.5

36

40.6

1931

. 35

35.5

35

35.5

33 30 19

16.5

18

17.5

21.3

20.5

26.4

1932

. 20

19.5

19.5

19.5

18.5 17.5 15

13.5

12.5

12

11.5

12

15.9

1933

. 12.5

12.5

13

16

21.5 24 38.5

32

32

30.5

31.5

33

24.8

1934

. 33.5

38

36

36

34 38.5 39

44

49

50

50

55

41.9

(Indexes:

same month 19X5-1919

= 100)

1925....

. 122

117

115

102

95 100 98

102

96

93

90

93

102

1926

. 88

88

84

87

86 85 85

93

93

93

96

94

89

1927

. 89

87

90

90

94 95 104

112

113

111

113

111

100

1928

. 106

112

118

124

129 133 116

87

88

94

97

100

110

1929

. 94

96

93

96

96 88 97

107

110

109

105

103

99

1930

. 89

89

89

92

91 86 74

92

99

92

86

81

88

1931

. 73

71

69

71

69 61 41

41

44

41

50

46

57

1932

. 41

39

38

39

39 36 33

33

31

28

27

27

34

1933

. 26

25

26

32

45 49 84

79

78

71

74

74

54

1934

. 70

76

71

72

71 79 85

109

120

116

118

123

91

SOYBEANS

(Dollars per bushel)

1925-1929. . .

. 1.91

1.91

2.10

2.11

2.22 2.36 2.39

2.29

1.78

1.52

1.55

1.66

1.98

1925

. 2.00

2.14

2.18

2.25

2.32 2.60 2.38

2.01

1.78

1.40

1.38

75

2.02

1926

. 2.44

1.86

2.51

2.22

2.42 3.01 2.63

3.21

2.57

1.62

1.67

84

2.33

1927

. 1.85

2.09

2.10

2.14

2.19 2.21 2.22

2.11

1.27

1.72

1.63

.52

1.92

1928

. 1.56

1.58

1.67

1.86

1.96 1.57 2.12

2.02

1.48

1.32

1.40

.48

1.67

1929

. 1.72

1.86

2.06

2.08

2.23 2.41 2.62

2.08

1.79

1.52

1.66

.70

1.98

1930

. 1.68

1.80

1.90

2.02

2.03 2.08 1.63

1.49

1.51

1.51

1.49

.36

1.70

1931

. 1.32

1.38

1.36

1.32

1.36 1.17 1.18

1.00

.57

.40

.36

.40

.98

1932

. .44

.46

.47

.45

.44 .45 .43

.36

.37

.38

.37

.39

.42

1933

. .40

.38

.43

.45

.66 .93 .98

.94

.83

.64

.66

.64

.66

1934

. .80

1.02

.96

1.79

1.13 1.35 1.42

1.16

.83

.82

.82

1.06

1.10

(Indexes:

same month 19S5-19S9

= 100)

1925....

. 105

112

104

106

105 110 100

88

100

92

89

105

104

1926

. 128

97

120

105

109 128 110

140

144

107

108

111

118

1927

. 96

109

100

101

99 94 93

92

71

113

105

92

95

1928

. 82

83

80

88

88 67 88

88

83

87

90

89

83

1929

. 90

97

98

99

100 102 110

90

101

100

107

102

100

1930

. 88

94

90

96

91 88 68

65

85

99

96

82

86

1931

. 69

72

65

63

61 50 49

44

32

26

23

24

49

1932

. 23

24

22

21

20 19 18

16

21

25

24

23

21

1933

. 21

20

20

21

30 39 41

41

47

42

43

39

34

1934

. 42

53

46

85

51 57 59

51

47

54

53

64

56

•For Illinois districts South-Southweet and Southwest, as obtained from Illinois State Department of Agriculture.

1935}

ST. Louis MILK PROBLEMS

171

TABLE 25. FARM PRICES Concluded

Year

Jan.

Feb.

Mar.

Apr.

May June July

Aug.

Sept.

Oct.

Nov.

Deo.

Average

VEAL CALVES'

(Dollars per 100 poundi)

1925-1929...

. 11.95

11.96

12.07

11.39

11.09 11.01 11.21

11.77

12.63

12.64

11.93

11.99

11.80

1925....

. 9.68

8.68

10.25

9.54

9.04 8.10 9.53

10.07

10.45

10.72

10.30

10.24

9.71

1926

. 11.51

11.65

11.01

10.39

10.45 11.22 10.70

10.76

11.88

12.46

10.84

10.84

11.14

1927

.. 11.54

12.14

12.07

11.57

10.26 10.04 10.28

11.66

12.17

12.41

11.64

12.42

11.52

1928

.. 12.41

13.03

12.66

12.00

12.25 12.75 12.44

13.00

14.60

13.82

13.73

13.06

12.98

1929

. 14.62

14.30

14.34

13.46

13.45 12.96 13.10

13.35

14.03

13.80

13.15

13.39

13.66

1930

.. 13.22

13.54

12.52

11.54

9.83 10.18 9.83

9.57

10.22

11.12

10.42

8.18

10.85

1931

. . 9.98

9.46

8.56

7.78

7.39 7.28 7.20

7.37

7.92

7.61

6.80

6.84

7.84

1932

. . 6.69

6.50

6.85

5.42

4.64 4.57 5.31

5.12

5.51

5.55

4.98

4.60

5.48

1933

.. 4.68

5.80

5.35

4.64

4.90 4.68 4.74

5.08

5.50

5.50

5.20

4.52

5.05

1934

.. 5.03

6.05

5.55

5.25

4.89 4.26 4.34

4.54

5.80

5.85

5.75

5 60

5.24

(Indexet:

tame month 1915-1919

= 100)

1925....

81

73

85

84

82 74 85

86

83

85

86

85

82

1926

. . 96

97

91

91

94 102 95

91

94

99

91

90

94

1927

. . 96

102

100

102

93 91 92

99

96

98

98

104

98

1928

. . 104

109

105

105

110 116 111

110

116

109

115

109

110

1929

. . 122

120

119

118

121 118 117

113

111

109

110

112

116

1930

. . Ill

113

104

101

89 92 88

81

81

88

87

68

92

1931

.. 84

79

71

68

67 66 64

63

63

60

57

57

66

1932

.. 56

54

56

48

42 42 47

44

44

44

42

38

46

1933

. . 39

48

44

41

44 42 42

43

44

44

44

38

41

1934

.. 42

51

46

46

44 39 39

39

46

46

48

47

44

WHEAT*

(Dollars per buthcl)

1925-1929. . .

.. 1.46

1.48

1.44

1.40

1.47 1.41 1.31

1.30

1.30

1.31

1.29

1.32

1.37

1925....

. 1.82

1.82

1.77

.60

1.65 1.66 1.42

1.55

1.53

1.48

1.54

.65

.62

1926

.. 1.72

1.72

1.53

.50

1.56 1.46 1.29

1.26

1.24

1.28

1.28

.26

.42

1927

.. 1.26

1.26

1.24

.18

1.28 1.35 1.34

1.28

1.28

1.29

1.27

.29

.28

1928

.. 1.28

1.30

1.42

.52

1.80 1.56 1.41

1.22

1.24

1.28

1.22

.25

.38

1929

. . 1.24

1.28

1.22

.18

1.08 1.00 1.10

1.18

1.21

1.20

1.13

.17

.16

1930

.. 1.19

1.10

1.05

.04

.98 .98 .76

.80

.82

.75

.73

.70

.91

1931

.69

.68

.66

.67

.66 .59 .39

.38

.38

.37

.50

.46

.54

1932

.. .45

.45

.46

.46

.44 .40 .37

.42

.42

.40

.38

.38

.42

1933

.. .40

.39

.42

.52

.71 .66 .94

.82

.76

.72

.80

.77

.66

1934

.. .78

.81

.80

.76

.74 .86 .82

.92

.94

.90

.90

.92

.85

(Indexet.

tame month 19t5-19t9

= 100)

1925....

. 125

123

123

114

112 118 108

119

118

113

119

125

118

1926

.. 118

116

106

107

106 104 98

97

95

98

99

95

103

1927

.. 86

85

86

84

87 96 102

98

98

98

98

98

93

1928

.. 88

88

99

109

122 111 108

94

95

98

95

95

100

1929

.. 85

86

85

84

73 71 84

91

93

92

88

89

85

1930

.. 82

74

73

74

67 70 58

62

63

57

57

53

66

1931

.. 47

46

46

48

45 42 30

29

29

28

39

35

39

1932

.. 31

30

32

33

30 28 28

32

32

30

29

29

30

1933

.. 27

26

29

37

48 47 72

63

58

55

62

58

48

1934

.. 53

55

56

54

50 61 63

71

72

69

70

70

62

•For Illinois districts South-Southwest and Southwest, as obtained from Illinois State Department of Agriculture.

172 BULLETIN No. 412 [.April,

TABLE 26. COST OF A ST. Louis DAIRY RATION,* BY MONTHS, 1925-1934 (Per 1000 pounds)

Year

Jan.

Feb.

Mar.

Apr.

May

June

July

Aug.

Sept.

Oct.

Nov.

Dec.

Average

1925-1929. 1925 ...

....$14.06 . 16.70

$14.17

15.90 12 04

$14.27 $14.33

15.89 15.06 11 51 11 83

$14.69

15.70 11 75

$14.95

16.07 11 76

$14.63 $14.46 $14.24

15.17 15.43 14.08 11 83 12 24 11 96

$13.75

12.78 11 66

$13.11

12.34 10 98

$13.20

12.35 11 09

$14.15

14.79 11.76 13.64 16.04 14.54 12.39 7.91 4 75

1926

12 39

1927

11 63

12.12 15.55 15 26

12.21 16.77 14 97

12.20 17.84 14 62

12.98 19.21 13 82

14.44 18.82 13 65

14.58 16.88 14 67

14.75 14.91 14 96

15.15 14.60 15 42

14.57 14.66 15 08

14.38 13.99 13 82

14.64 14.51 13 41

1928 .

. . 14.78

1929

14 82

1930

13 03

12.66 9.84 5 31

12.47 10.09 5 37

13.47 10.10 5 35

13.22 9.18 4 95

12.66 8.45 4 61

11.73 7.57 4 42

13.52 6.84 4 84

13.12 5.92 4 74

11.80 5.20 4 21

10.73 6.16 3 95

10.31 5.64 3 81

1931

. 9 97

1932

5 49

1933

. 3.87

4.02 9 08

4.44 9.19

5.30 9.14

6.55 8.76

6.82 9.88

10.02 10.38

8.92 12.61

8.09 13.17

7.23 13.16

7.68 13.67

7.77 15.24

6.73 11.05

1934

8 30

•Composed of 450 pounds of corn-and-cob meal, 180 pounds of oats, 190 pounds of bran, and 180 pounds of cotton- seed meal. Farm prices as obtained from the Illinois State Department of Agriculture have been used for corn and oats; St. Louis prices as obtained from Crops and Markets, U. S. Department of Agriculture, and from the St. Louis Merchants Exchange have been used for bran and cotton-seed meal. This ration was recommended by W. B. Nevens, Department of Dairy Husbandry, University of Illinois.

TABLE 27. QUANTITIES OF A ST. Louis DAIRY RATION THAT 100 POUNDS OF MILK

WOULD BUY, BY MONTHS, 1925-1934

(Pounds)

Year

Jan.

Feb.

Mar.

Apr.

May

June

July

Aug.

Sept.

Oct.

Nov.

Dec.

Average

1925....

. 138

145

126

133

111

109

128

126

146

164

178

178

140

1926 .

178

183

187

159

136

144

161

163

167

172

200

212

172

1927 1928

. 206 . 166

190 148

184 121

164 112

131

88

118 90

123 113

129 127

132 137

144 143

156 161

160 162

153 131

1929 .

159

151

147

137

123

124

130

134

130

143

163

172

142

1930

165

150

144

134

121

126

154

140

160

170

170

164

150

1931

. 147

148

153

138

138

167

218

234

277

312

244

257

203

1932

220

220

182

168

164

182

199

178

188

221

230

228

198

1933

. 214

199

180

160

137

139

116

130

143

160

151

175

159

1934

. 146

145

140

131

132

131

129

113

111

96

104

115

124

TABLE 28. AVERAGE DAILY PRICES OF 92-ScoRE BUTTER AT CHICAGO,

BY MONTHS, 1919-1934*

(Cents per pound)

Year

Jan.

Feb.

Mar.

Apr.

May

June

July

Aug.

Sept.

Oct.

Nov.

Dec.

Average

1919 ...

. 60

49

60

62

57

51

51

53

57

64

69

68

58.4

1920

. 63

63

66

64

57

55

55

54

57

57

60

51

58.5

1921

48

47

47

44

29

32

39

40

42

45

44

43

41 6

1922

, . 34

37

38

37

34

36

34

34

39

44

50

53

39.1

1923

. 50

50

49

45

40

39

38

43

46

47

52

53

46.0

1924

52

49

46

37

37

39

38

37

37

37

42

42

41.1

1926

. . 39

40

48

43

41

42

42

42

46

49

50

47

44.1

1926

43

43

42

38

39

39

39

40

43

46

49

53

42 8

1927

. 48

50

49

48

41

40

40

41

45

46

48

51

45.5

1928

. 47

46

48

44

43

43

44

46

47

46

49

49

46.0

1929

. 47

49

48

44

42

42

41

42

45

44

41

39

43.7

1930

. 35.1

35 3

37.2

37.2

33.7

32.1

34.6

38.0

38.2

37.7

33.7

30.5

35 3

1931 .

27 3

27 1

28 7

24 4

22 4

22 3

23 8

27.2

30.3

32.2

29.7

29.1

27.0

1932

23.0

21.6

22.0

19.0

17.1

16.3

17.7

19 4

20 0

19.8

22.1

22.7

20.0

1933

.. 18.8

17.8

17 6

19.8

21.8

22 4

23.9

20.6

22.7

23.0

22.6

18.6

20.8

1934

19 3

24 4

24 5

22 4

23 2

24.2

23.6

26.4

24.8

25.9

29.0

29.5

24.8

•From U. S. D. A. Yearbooks 1919 to 1932, and current copies of Michigan Milk Messenger, Jan., 1933, to Jan., 1935.

1935]

ST. Louis MILK PROBLEMS

173

TABLE 29. AVERAGE NET PRICES PAID TO PRODUCERS FOR S.S-PERCENT MILK

F.O.B. COUNTRY PLANTS IN A 41-TO-50-MiLE ZONE FROM

ST. Louis, 1909 TO 1934»

Year

Jan.

Feb.

Mar.

Apr.

May June July

Aug.

Sept.

Oct.

Nov.

Dec.

Average

1909 ..

. 1.52

1.52 1 68

.47 56

1.14 1 33

(Dollari per 100 poundt .84 .91 .06 1 07 1.07 16

1.20 1 26

.25

39

.52

63

.56 72

.66 83

1.30 45 .44 .39 .53 .55 .34 .45 2.18 2.86 3.22 3.19 2 02

1010

1 70

1911

1 87

1.82 1.74 1.73 1.80 1.64 1.63 1.99 3.20 3.39 3.42 2 63

.68 .56 .56 .66 .52 .52 1.70 3.10 3 18 3.11 2 15

1.31 1.30 1.36 1 35 1.34 1.48 1.70 2.65 2.78 2.98 2 21

1.01 1.01 .19 .01 .08 .11 1.11 1.26 .31 1.11 1.30 .39 1.00 1.02 .16 1.47 1.14 1.15 1.30 1.30 2.10 1.95 1.80 2.24 2.25 2.58 2.97 2.92 2.77 3.25 1 83 1 32 1 63

1.32 1.19 1.42 1 45 1.20 1.15 2.20 2.69 3.10 3.75 2 06

.29 .28 .50 .49 .13 .24 2.20 2.94 3.65 3 52 1 94

.50 .47 .69 64 .24 .34 3.20 3.30 3.66 2.76 1 94

.59 .59 .80 .73 1.50 1.78 3.20 3.65 3.67 3.02 2 15

.73 .76 .87 .77 .62 .89 3.20 3.66 3.80 3.07 1 75

1912

. 1.77

1913

. 1.76

1914

1 90

1915

. 1.76

1916

. 1.65

1917

. 2 04

1918

. 3.20

1910

3 56

1920

. 3 67

1921

2 70

1922

1 74

1.64 2.37 2.45

1.56 2.25 2.25

1.40 2 15 1.95

.35 1.40 1.80 .85 1.85 2.00 .60 1.60 1.80

1.80 2.10 1.80

1.80 2.10 1.85

1.95 2.25 2.00

2.25 2.40 2.00

2.45 2.40 2 20

1.76 2.18 2 00

1923

. 2 50

1924

. 2.45

1925....

. 2.30

2.30 2 20

2.00 2 15

2.00 1 90

.75 1.75 1.95 60 1 70 .90

1.95 2 00

2.05 2 00

2.10

2 00

2.20 2 20

2.20 2 35

2.05 2.02 2.06 2.07 2.07 1.85 1 50

1926 .. . .

2 20

1927

. 2 40

2.30 2 30

2.25 2 20

2.00 2 00

.70 1.70 .80 70 1 70 90

1.90 1 90

2.00 2 00

2.10 2 10

2.25 2 25

2.35 2.35 2.30 1.69 1.45

1028

2 45

1929

2 35

2.30 1.90 1.46

2.20 1.80 1.54

2.00 1.80 1 39

.70 1.70 .90 .60 1.60 .80 .27 1.41 .65

2.00 1.90 1.60

2.00 2.10 1.64

2.15 2.00 1.62

2.25 1.82 1.50

1930

. 2.15

1981.

. 1.47

1932

. 1 21

1.17

.80 1.32

101 96 101 101 101 83 64 51 35 58

.98 .80 1.29

93 100 104 102 102 83 71 45 39 60

.90 .81 .84 .88 .85 .90 .95 .16 1.20 1.16 1.29 .34

(Indezet: tame month 1915-19X9 101 104 102 103 96 95 99 101 101 101 99 95 101 101 99 101 101 101 99 101 91 95 94 95 70 75 82 87 45 48 49 47 43 53 56 61 61 69 75 71

.86 1.16 1.43

= 100)

100 103 97 97 103 97 82 44 59 73

.89 1.16 1.46

102 100 100 100 100 104 82 44 58 73

.93 1.16 1.53

100 96 100 100 103 96 78 44 56 73

.91 1.16 1.54

99 99 101 101 101 82 67 41 52 69

.87 1.36 1.43

95 102 102 102 100 73 63 38 59 62

.94 1.02 1.35

100 99 100 101 101 90 73 46 50 66

1933

.83

1934

. 1.21

1925 .

98

1926

. 94

1927

. 103

1928 ...

105

1929

. 100

1930

92

1931

63

1932

. 52

1933 .

35

1984

. 52

•The prices shown for October, 1930, and subsequent months are weighted averages of the prices paid members of the Sanitary Milk Producers for each month that milk was sold on a classified basis. Prices previous to October, 1930, were obtained thru the courtesy of the St. Louis Dairy Company.

An additional 10 cents a hundred pounds of milk was paid from July, 1927, to March, 1930, to those producers who installed certain specified equipment.

The weighted gross average price f.o.b. country plant was calculated from October, 1930, to October, 1934. Classi- fication prices were quoted f.o.b. city from December, 1933, to October, 1934. The transportation differential from the 50-mile zone to St. Louis from December, 1933, to February, 1934, was 15 cents per 100 pounds on each of the three classes of milk. The following transportation differentials were applied in the sale of milk to distributors from March to December, 1934, on 100 pounds of milk:

City limitt to 50-mile tone

March 1 to May 31, 1934

June 1, to August 13, 1934

41 to 50-mile tone

August 14 to December 31, 1934.

ClattI cent* 20 20

21

Claiill

centt

10

20

21

Clot* III

centt

5

5

These differentials were applied to the volumes in each classification for each month from March to November 14, 1934, in arriving at a weighted average transportation differential as applied to producers in the country-plant zones. The differentials per 100 pounds of milk for the 50-mile zone and 41-50 mile zone were as follows, in cents: March, 13; April, 12; May, 11; June, 14; July, 14; August, 13; September, 13; October, 15; November, 18; and December, 21. These differentials were subtracted from the weighted average gross price f.o.b. city to obtain the average weighted gross price f.o.b. country plant from November 14, 1934. From November 15, 1934, the transportation differential to pro- ducers was 21 cento per 100 pounds on all milk from the 41-50 mile zone to the city limits.

The following check-off was deducted from the average weighted gross price f.o.b. country plants to obtain the average weighted net price per 100 pounds paid to producers:

Sanitary Milk Producers centt

October, 1930, to February, 1932 3

March, 1932, to November, 1932 5

December, 1932, to February, 1934 4

February to December, 1934 3

Milk Industry Board

November 25, 1933, to February, 1934 1

Milk Market Administrator March to December, 1934 1

174 BULLETIN No. 412 [.April,

TABLE 30. GROSS PRICES PAID FOR S.S-PERCENT MILK BY DISTRIBUTORS, F.O.B.

COUNTRY PLANTS FROM OCTOBER, 1930, TO NOVEMBER 25, 1933,» AND

F.O.B. CITY PLANTS FROM NOVEMBER 26, 1933, TO OCTOBER, 1934

(Dollars per 100 pounds)

Year Jan. Feb. Mar. Apr. May June July Aug. Sept. Oct. Nov. Dec.

Class I milk

1930....

2.43 1 93

2.43 2 1 93 1

43 93 04

945 00

1931.... 1932....

1933.... 1934....

2 18

2 18

2 18 2 18

2 18

2 18

2 18

2 18 2

01

1 81

1.81

1 40 1 40

1 40

1 40

1 40

1.40 1

40

1 40

1 18 1

. 1.09 1 945

1.09 1 945

1.09 1.09 1.85 1 85

1.14 1.85

1.14 2 00

2 00

2 00* 2

T>

1.20*> 2 35

i:945«) 1 2 35" 2

(2.35)

(2.00)

Class II milk (formerly termed "first surplus")

1930 ...

1.58 1.35

1.42 1 1.25 1

28 22 95 29

54

1931.... 1932.... 1933....

1934....

. 1.15

1.14

1.20 1.02

.94

.94

1.00

1.14 1

?7

97

91

93 80

.72

.68

.74

76

76

.76

93

. .79 1 04

.75 1 265

.74 .80 1 33 1 24

.91 1.28

.94 1 27

1.24

(b) (

1 33<< 1

») Tl

1 38

(b) 1. 1 50* 1

(1.41)

(1.53)

Class HI milk (formerly termed "second surplus")

1930. . . .

1.32 1.13 .63

1.06

1.18 1 1.04 1 .77 0) 1 .79" 1.15* 1 (1.18)

.07

02 79 04

18

1931.... 1932.... 1933....

1934....

.96 . .81 . .66

. .84

.95

.76 .62

1.01

1.00 .85 .77 .66 .62 .69

1.01 .93

.78 .60 .76

.96

.78 .57

.78

1.00

'!62 .98

.95 1 .63

1.05<» 1 (1.08)

06 63 b)

02

•Prices from October, 1930, to November 25, 1933, are those paid by distributors contracting with the Sanitary Milk Producers.

'•'Producers were paid a flat price from July 1 to November 25, 1933.

°The Marketing Agreement under the Agricultural Adjustment Administration became effective November 26, 1933, and from that date prices were quoted f.o.b. city plants, St. Louis.

''These prices were in effect from August 1-13, 1934, when a new price series shown in parentheses became effective.

•Prices in effect November 1-15, 1934, when a new price series, shown in parentheses, became effective.

1935]

ST. Louis MILK PROBLEMS

175

TABLE 31. AVERAGE PRICES PAID TO PRODUCERS FOR 3.5-PERCENT MILK AT THE

GREENVILLE CONDENSERY, BY MONTHS, 1909 TO 1934"

(Dollars per 100 pounds)

Year

Jan.

Feb.

Mar.

Apr.

May

June

July

Aug.

Sept.

Oct.

Nov.

Dec.

Average

1909....

. 1.70

1.70

1.60

1.35

1.00

1.00

1.15

1.30

1.30

1.55

1.60

1.70

1.41

1910

. 1.75

1.75

1.60

1.40

1.15

1.15

1.25

1 30

1.35

1.75

1.80

1.90

1.51

1911

. 2.00

1.95

1.75

1.40

1.15

1.15

1.25

1.40

1.40

.60

1.75

1.90

1.56

1912

. 2.00

1.90

1.70

1.45

1.05

1.10

1.20

1.30

1.35

.55

1.75

1.95

1.521

1913

. 1.95

1.85

1.70

1.45

1.25

1.40

1.45

1.45

1.45

.80

1.90

2.00

1.64

1914

. 2.00

2.00

1.80

1.45

1.25

1.40

1.55

1.55

1.70

.90

1.90

2.00

1.71

1915

. 2.00

2.00

1.80

1.50

1.20

1.20

1.35

1.35

1.40

.50

1.65

1.80

1.56

1916

. 1.90

1.85

1.70

1.55

1.30

1.35

1.40

1.50

1.50

.90

2.00

2.25

1.68

1917

. 2.25

2.25

2.25

2.20

2.10

2.15

2.30

2.45

2.75

3.20

3.20

3.20

2.521

1918

. 3.20

3.07

2.95

2.65

2.00

2.00

2.30

« 75

3.00

3.35

3.68

3 70

2.89

1919

. 3.60

3.35

3.25

2.65

2.50

2.50

3.00

3.52

3.65

3.65

3.70

3.821

3.27

1920

. 3.70

3.45

3.00

3.00

2.90

2.80

3.25

3.75

3.25

2.65

3.10

2.50

3.11

1921

. 2.25

2.121

2.121

2.18

1.80

1.29

1.60

2 08

1.92

1.91

2.19

1 80

1.94

1922

. 1.75

1.65

1.55

1.40

1.35

1.40

1.80

1.80

1.80

1.95

2.25

2.45

1.76

1923

. 2.50

2.30

2.25

2.15

1.85

1.85

2.00

2.10

2.10

2.25

2.40

2.40

2.18

1924

. 2.25

2.25

2.15

1.85

1.60

1.60

1.70

1.70

1.70

1.85

1.921

2.20

1.90

1925

. 2.20

2.00

2.00

2.00

1.75

1.75

1.95

1.95

2.05

2.10

2.20

2.20

2.01

1926

. 2.20

2.10

2.10

1.90

1.60

1.70

1.90

2.00

2.00

2.00

2.10

« 35

1.991

1927

. 2.40

2.30

2.25

2.00

1.70

1.70

1.80

1.90

2.00

2.10

2.25

2.35

2.06

1928

. 2.45

2.30

2.20

2.00

1.70

1.70

1.90

2.00

2.10

2.20

2.35

2.45

2.11

1929

. 2.45

2.40

2.30

2.10

1.80

1.80

2.00

2.10

2.10

2.25

2.35

2.35

2.17

1930

. 2.00

1.80

1.75

1.75

1.60

1.60

1.80

1.90

1.90

1.70

1.75

1.60

1.76

1931 1932

1.40 . 1.071

1.30 .971

1.25 .95

1.20 .90

1.071 .85

1.021 .771

1.00 .75b

1.05 .75

1.20 .80

1.271 .80

1.25 .80

1.20 .85

1.181 .86

1933

. .82*

.75

.75

.80

.871

.90

1.021

1.05

1.05

1.06

1.06

1.00

.93

1934

. 1.02J

1.15

1.16

1.04

1.081

1.14

1.09

1.22

1.15

1.19

'Prices were obtained thru courtesy of Pet Milk Co., Greenville, 111.

bFroni July, 1932, to March, 1934, an additional 10 cents per 100 pounds was paid to each producer having a milk house.

176

BULLETIN No. 412

{.April,

TABLE 32. DAIRY CATTLE POPULATION AND PRODUCTION OF MILK IN THE ST. Louis MILKSHED, JUNE, 1933, TO MAY, 1934"

Number of Average production producers per cow

Average number of cows per 10 farms

Average number of heifers per 10 farms

question- naires

Annual

Per dayb

Milk- ing

Dry

Total

Two- year olds

Year- lings

Calves

Total

Illinois

Madison

624

4 883

17.1

71

15

86

9

12

11

32

Clinton

489

4 618

16.0

81

19

100

10

12

11

33

St. Clair

447

4 235

14.3

58

12

70

7

10

9

26

Randolph

409

3 957

14.6

64

16

80

8

11

14

33

Washington

391

3 890

15.4

59

14

73

7

9

9

25

Effingham

361

3 924

15.1

76

18

94

12

15

13

40

Fayette

281

3 486

14.4

63

15

78

9

12

11

32

Montgomery

220

4 424

17.0

71

18

89

10

17

13

40

Bond

193

4 312

15.2

67

14

81

9

12

11

32

Marion

192

3 889

14.6

61

12

73

8

10

9

27

Greene

106

3 810

14.3

82

22

104

11

22

20

53

Monroe

103

4 809

16.6

53

10

63

7

8

8

23

Macoupin

102

5 050

17.3

89

19

108

15

19

15

49

Shelby

73

3 766

10.1

78

15

93

9

14

13

36

Moultrie

66

3 201

25.8

82

13

95

8

15

24

47

Others

64

4 514

12.2

84

16

100

14

14

19

47

Jersey

53

4 450

16.9

80

18

98

16

14

12

42

Perry

42

3 570

14.4

61

16

77

7

13

12

32

Christian

27

3 891

13.8

84

9

93

11

19

16

46

Cumberland

24

3 141

14.5

67

22

89

9

19

22

50

Clark

14

3 591

15.5

61

21

82

8

11

11

30

Jefferson

13

2 656

8.9

84

17

101

13

34

22

69

Average

(4 294)"

4 290

15.5

69

16

85

9

12

12

33

Missouri

Franklin

305

3 067

13.2

75

21

96

10

13

11

34

Jefferson

282

4 028

15.8

94

22

116

14

17

13

44

Lincoln

104

4 096

15.8

59

17

76

9

9

7

25

St. Charles

83

4 637

14.1

76

15

91

10

14

12

36

Texas

49

3 829

15.6

127

21

148

16

20

24

60

St. Louis

31

8 016

28.1

119

28

147

16

23

23

62

Others

29

3 744

16.6

116

28

144

18

41

30

89

Phelpe

28

2 826

11.2

77

28

105

7

11

10

28

Wright

28

3 852

12.0

141

14

155

19

18

38

75

Audrain

27

4 181

17.0

84

21

105

10

14

18

42

Pike

25

4 158

18.2

118

28

146

11

35

25

71

Montgomery

24

3 257

7.5

83

27

110

9

17

18

44

Howell

22

2 621

11.9

129

19

148

16

25

18

59

Marion

18

3 219

11.3

209

40

249

41

53

49

143

Gasconade

17

2 824

8.7

79

27

106

9

15

16

40

Crawford

16

3 951

14.5

99

21

120

19

22

29

70

Osage

14

2 323

10.1

97

50

147

12

29

23

64

Warren

13

3 602

13.7

62

23

85

4

18

8

30

Average

. (1 115)°

3 793

14.6

90

22

112

12

17

15

44

Illinois and Missouri

Average ,

. (5 409)"

4 161

15.3

73

17

90

10

13

12

35

•Based upon answers to questionnaires by 5,409 producers, June, 1934. k-For May, 1934. 'Total.

1935]

ST. Louis MILK PROBLEMS

177

TABLE 33. DAIRY CATTLE ON FARMS IN THE UNITED STATES AND IN ILLINOIS ON

JANUARY 1, 1920-1934"

United States

Illinois

Year

Milk cows and heifers two years old and older

Dairy heifers one and two years old

Milk cows and heifers two years old and older

Dairy heifers one and two years old

1920

21 427 000

4 418 000

1 047 000

1921

21 408 000

4 155 000

1 027 000

1922

21 788 000

4 023 000

125 000

1923

22 063 000

4 147 000

148 000

179 000

1924

22 256 000

4 137 000

159 000

196 000

1925

22 481 000

4 195 000

049 000

187 000

1926

22 188 000

3 916 000

039 000

167 000

1927

21 801 000

4 059 000

988 000

184 000

1928

21 828 000

4 201 000

968 000

175 000

1929

21 919 000

4 413 000

958 000

186 000

1930

22 499 000

4 669 000

1 006 000

208 000

1931

23 576 000

4 775 000

1 057 000

234 000

1932....

24 475 000

4 685 000

1 089 000

215 000

1933

25 277 000

4 704 000

1 122 000

219 000

1934

26 062 000

4 749 000

1 165 000

209 000

•As reported by the U. S. Department of Agriculture.

TABLE 34. AVERAGE NUMBER OF DAIRY CATTLE PER 10 FARMS IN THE ST. Louis

MILKSHED, JUNE, 1934

Number of milking cows

Number of producers

Cows per 10 farms

Heifers per 10 farms

Milking

Dry

. Total

2-year

Yearlings

Calves

Total

0-4....

1 300

33 64 102 142 184 221 345 73

13 15 20 25 32 32 54 17

46 79 122 167 216 253 399 90

6 8 8 18 28 42 54 10

7 12 16 27 35 53 74 13

6 11 10 27 30 42 63 12

19 31 40 72 93 137 191 35

5-8

2 643

9-12

1 004

13-16

285

17-20

95

21-24

37

Over 24

45

Average

. (5 409)<>

•Total

178

BULLETIN No. 412

{.April,

TABLE 35. TOTAL MILK PRODUCTION OF MEMBERS OF SANITARY MILK PRODUCERS, AND OF NONMEMBERS, BY COUNTIES, JUNE, 1933 TO MAY, 1934

Volume of milk in millions of pounds

Percent of county totals

Volume of milk in millions of pounds

Percent of county totals

Illinois counties

Non- Mem- mem. Total

bers bers

., Non- Mem- mem.

be" bers

Missouri counties

.. Non- Mem- mem. Totai

be« bers

Non- Mem- mem.

bers berg

Madison

. 54.9 20 4 75 3

73 27

Jefferson

13.5 6.8 20.3

67 33

Clinton

. 31.9 11.6 43.5

73 27

Franklin

11.3 8.6 19.9

57 43

St. Clair

21 7 14 9 36 6

59 41

St. Charles

42 20 62

68 32

Washington ....

. 21.8 95 31 3

70 30

Lincoln

42 .9 5.1

83 17

Randolph

. 13.2 9.8 23 0

57 43

Marion

.5 4.5 5.0

10 90

Kffingham . . .

. 12.4 8.0 20.4

61 39

St. Louis

1.3 2.7 4.0

32 68

Bond

11 7 40 15 7

74 26

Texas

1 32 33

4 96

Montgomery

. 10 9 41 15 0

72 28

Pike

1.8 .8 2.6

68 32

Macoupin

. 10.5 3.8 14.3

74 26

Montgomery. . . .

1.3 .6 1.9

70 30

Fayette

9.1 35 12 6

72 28

13 3 16

81 19

Marion

.77 18 95

81 19

Wright

(») 15 15

2 98

Greene

.61 12 73

83 17

Crawford

.5 .9 1.4

36 64

Monroe

. 2.2 6.5 8.7

25 75

Phelpe. ..

.1 1.0 1.1

9 91

Jersey

48 12 60

81 19

Howell

11 11

100

Shelby

. 15 27 42

35 65

Warren

1 .7 .8

16 84

Moultrie

.4 3.2 3.6

11 89

Gasconade

.6 .2 .8

72 28

Perry

8 11 19

42 58

Osage

156

23 78

Clark

6 12 18

32 68

Cole . .

5 .5

8 92

Douglas

.2 1.6 1.8

11 89

Rails

.4 .4

7 93

Coles

.3 1.4 1.7

17 83

Maries

.2 .2

0 100

Cumberland .

6 915

42 58

.2 .2

0 100

Christian

.1.0 4 14

71 29

Washington . . .

.1 ... .1

100 0

Jackson

.1 .3 .4

35 65

Others

.1 .1

0 100

Piatt . . .

(») 4 4

6 94

Jasper

.2 .1 3

60 40

Missouri totals. .

41 0 37.7 78.7

52 48

Jefferson Clay

. (») .2 .2 1 (») 1

6 94 67 33

Sangamon

1 (•) 1

60 40

Illinois totals

.224.8 113.8 338.6

66 34

Grand totals.. . .

265.8 151.5 417.3

64 36

•Less than 100,000 pounds of milk.

TABLE 36. MONTHLY VARIATION IN AVERAGE DAILY PRODUCTION OF MILK BY

MEMBERS OF THE SANITARY MILK PRODUCERS, NONMEMBERS, AND TOTAL

FOR THE ST. LOUIS MlLKSHED, JUNE, 1933, TO MAY, 1934"

June

July

Aug.

Sept.

Oct.

NOT. Dec.

Jan.

Feb.

Mar.

Apr.

May Average

(Average daily production per farm in poundt)

Members

111

101

104

94

91

94 97

102

103

99

112

140 104

Non-members..

108

97

97

87

84

85 86

92

94

92

105

132 97

Total

110

100

102

92

89

91 93

98

100

97

110

137 102

(Indeiet of average daily production: It montht average

100)

Members

107

97

100

90

88

90 93

98

99

95

108

134 100

Non-members..

112

101

101

90

87

88 89

95

97

95

108

137 100

Total

108

98

100

90

88

90 92

97

98

95

108

135 100

•Based upon data for 8,426 producers who shipped milk 10 months or longer.

1935]

ST. Louis MILK PROBLEMS

179

TABLE 37. AVERAGE DAILY PRODUCTION PER PRODUCER BY COUNTIES IN THE ST. Louis MILKSHED, JUNE, 1933, TO MAY, 1934

Counties

June

July

Aug.

Sept.

Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

Average

Ittinou Bond

108

99

99

87

91

92

89

93

94

89

106

137

99

Christian Clark

95 97

90 70

87

78

75 85

70

84

71 92

75 99

75 100

74

103

71 91

85 90

115 128

82 93

Clinton

126

112

114

105

108

111

118

125

126

123

137

171

123

Cumberland. . . Effingham Fayette . .

66 122 90

55

107 84

50 111 85

54 99 72

53

90 68

66 93 68

80 98 69

71 100 68

77 100 66

66 98 63

67

106 74

90 143 101

66 106 76

Greene

129

115

121

114

104

108

105

107

103

99

113

137

113

Jackson

124

106

105

86

77

121

148

142

145

128

118

141

120

84

96

76

51

58

70

76

82

84

80

98

128

82

Jersey .

126

114

114

101

94

107

106

102

100

101

114

124

108

Macoupin

164 121

151 111

148 114

140 102

151

104

160 110

165 114

176 120

175 119

170 114

184 128

216 160

167 118

Marion

109

96

104

88

88

94

77

88

89

86

102

136

96

Monroe

81

72

72

62

60

65

72

80

83

80

86

102

76

Montgomery. . Moultrie

110 339

97 237

98 192

89

174

86

187

96 191

103

229

97 273

96 294

90 352

101 392

131 373

100 269

Perry

98

86

92

84

68

70

68

76

76

76

83

105

82

Randolph Shelby

92 95

80 87

82 92

68 96

67 94

72 99

78 102

85 117

88 124

84 113

94 97

114 133

84 104

St. Clair

91

86

89

82

77

76

78

84

87

86

95

113

87

Washington . . .

Missouri Audrain

87 135

77 129

78 121

66 112

60 105

62 100

67 99

74 103

75 105

73 103

84 109

113

137

76 113

Buchanon Cole . ...

23 3

28 3

23

7

26 139

45 116

71 96

79 100

56 112

48 109

35 113

24 119

19

129

40

87

Crawford Franklin Gasconade Howell

162 101 73 180

164 92

72 144

172 94 90 154

156 84 95 145

126 76 92 135

112 67 73 120

119 68 69 85

131 74 71 81

146 76 69 100

151 75 60 103

184 85 71 139

226 108 94 176

154 83 77 130

Jefferson Lincoln

140 92

125

77

126 80

120 70

114 70

106 73

99

76

106 81

112 84

114 78

137 95

166 117

122 83

Maries

188

183

204

172

201

187

143

146

118

144

154

177

168

Marion

, 172

177

154

160

134

158

160

101

106

111

129

164

144

Montgomery . Oregon

, 96 . 825

81

790

82 963

93 804

98 629

91 438

100 317

116 363

122 266

117 156

128 190

151 559

106 525

Osage

107

97

99

120

134

108

89

86

88

89

118

140

106

PheTpa

82

74

106

95

79

65

66

61

62

64

84

95

78

Pike...

. 195

167

160

129

141

135

128

122

125

124

152

186

147

Rails

. 172

153

126

104

83

60

84

112

104

110

139

171

118

St. Charles... St. Louis Stoddard Texas . .

. 103 . 200 . 43 222

103 193 34 212

112 199 49 212

101 188 36 176

104 185 33 148

110 190 48 126

85 202 51 121

102 196 56

128

104 193 45

138

106 195 32 14

124 203 39 192

144 209 49 254

108 196 43 173

Warren

90

85

91

85

66

73

86

93

91

80

107

121

89

Wright

. 187

168

167

165

155

144

150

150

161

169

206

277

175

180

BULLETIN No. 412

{.April,

TABLE 38. NUMBER OF PRODUCERS IN THE ST. Louis MILKSHED, BY COUNTIES, MAY, 1933, TO JUNE, 1934

Number of producers shipping

Number of producers shipping

Illinois counties

10 months or more

9 months or less

Total

Missouri counties

10 months or more

9 months or less

Total

Madison

1 397 862 920 856 627 308 369 368 300 145 249 190 133 115 18 2 63 0 6 1 13 33 3 7 0 0 0 0

6 985

631 389 267 173 205 298 212 82 147 186 66 104 78 52 113 106 20 58 50 54 37 15 21 6 13 8 4 2

3 397

2 028 1 251 1 187 1 029 832 606 581 450 447 331 315 294 211 167 131 108 83 58 56 55 50 48 24 13 13 8 4 2

10 382

Franklin

453 380 105 132 36 32 46 36 29 35 32 12 15 22 13 23 14 13 4 4 0 3 1 1

1 441 8 426

218 112 66 36 100 42 23 21 25 12 7 23 13 5 13 2 5 5 6 0 4 0 1 0

739 4 136

671 492 171 168 136 74 69 57 54 47 39 35 28 27 26 25 19 18 10 4 4 3 2 1

2 180 12 562

St. Clair

Jefferson

Washington . .

St. Charles

Clinton

Lincoln

Randolph

Marion

Texas

Fayette

St. Louis.

Bond

Pike

Montgomery

Montgomery

Marion

Phelps

Monroe

Audrain

Macoupin

Wright...

Howell

Jersey

Shelby

Warren

Moultrie

Crawford

Perry

Osage

Douglas

Cole

Clark

Rails

Coles

Cumberland

Christian

Stoddard

Jefferson

Piatt

Missouri totals

Jasper

Clay

Illinois totals ...

TABLE 39. AVERAGE DAILY MILK PRODUCTION PER FARM BY 8,232 PRODUCERS IN

THE ST. Louis MILKSHED, CLASSIFIED BY PROPORTIONS THAT BASE

VOLUMES WERE OF MAY VOLUMES, JUNE, 1933, TO MAY, 1934

Percentage that base volumes were of May volumes

Num- ber of pro- ducers

June July Aug. Sept. Oct.

Nov.

Dec.

Jan.

Feb.

Mar.

Apr.

May

Aver- age

Under 10. ..

21

70 M 118 122 113 110 100 84 94 74

W2 l()ti

tea

no

10S

lor,

1(14 UK) 104 111

138

(Daily production per farm in pounds) 45 51 36 28 42 68 54 47 34 32 42 56 81 76 62 61 67 78 104 103 92 89 91 95 114 119 109 107 106 106 110 120 112 110 110 103 112 122 118 114 114 109 102 113 106 104 99 90 91 103 104 98 90 83 94 106 103 100 92 89 76 87 79 67 48 38

(Indexes of production: It months average = 74 84 59 45 68 112 82 72 52 49 64 85 89 84 68 67 74 86 97 96 86 83 85 89 100 105 97 95 94 94 103 113 106 104 104 96 106 115 112 108 108 104 111 124 116 114 108 99 112 127 128 120 111 102 111 126 122 119 108 106 139 160 144 123 88 70

77 70 91 104 108 101 100 86 76 84 62

100) 127 107 100 97 95 95 95 94 94 100 113

79 77 98 106 107 98 94 77 67 76 50

130 118 108 99 95 92 90 84 82 90 01

60 76 100 106 104 90 83 69 59 59 23

99 116 110 99 92 85 79 78 73 70 42

71 95 120 123 115 96 87 70 56 56 20

116 145 132 115 102 90 82 76 70 67 36

112 135 158 156 140 114 101 81 64 60 32

185 206 174 145 124 107 96 88 79 71 59

61 66 91 107 113 106 105 92 81 84 55

10-19

350

20-29

. 1 726

30-39

. 2 466

40-49

. 1 772

50-59

. 1 034

60-69

. 452

70-79

238

80-89

111

90-99

55

100 or over

7

Under 10. ...

21

10-19

. 350

20-29

. 1 726

30-39

. 2 466

40-49

. 1 772

50-59 ....

1 034

60-69

. 452

70-79

. 238

80-89

111

90-99

65

100 or over .

7

J9J5] ST. Louis MILK PROBLEMS 181

TABLE 40. TOTAL MILK PRODUCTION AND CLASS I SALES IN THE ST. Louis SALES AREA, JUNE, 1933, TO SEPTEMBER, 1934a

Month

Class I sales 1

Indexes (January, 934 = lOO11

Total , ) production

Indexes

[September, 1933 - 100")

19SS June

Ibi. 17 213 443

104

Ibt. 33 501 951

117

July

17 533 395

103

31 272 214

106

August

17 493 687

102

31 833 882

108

September

. 17 743 826

107

29 590 729

100

October

17 785 607

104

29 679 179

100

Nnvemhar ...... {..... .......

17 001 608

103

31 458 586

110

December

17 130 784

100

34 899 504

118

19S4 January

17 101 920

100

36 767 334

124

February

, 15 711 592

102

33 351 332

125

March

17 542 852

103

35 696 052

120

April

16 824 101

102

39 162 270

137

May...

. 18 091 395

106

51 198 356

173

Total for 12 months 207174210 ... 417311389

June 17928154 108 40423669 141

July 18 285 155 107 36 056 652 122

August 17482020 102 39554000 134

September 16 167 425 95 37 366 322 126

October 16922948 99 35393900 120

November 15 976 444 93 32 312 455 109

December 15 850 820 93 31 506 673 106

»Aa reported to St. Louis Milk Market Administrator under U. S. License No. 35. '•This was the low month of the 12 months June, 1933, to May, 1934.

(Sources of Data in Table 2, page 100)

•Rent intervals and number of families were determined from the 1930 U. S. Census (Population, Vol. 6: p. 63; Table 69, p. 756; and Table 24, p. 15). The number of families includes only the number reported in the Census classification on rents. For families owning their own homes the rental value is considered to be 10 percent of the total Census valuation. See "Marketing Notes," personal pub- lication by Paul D. Converse, University of Illinois.

bAverage incomes were estimated to be four times the rentals in 1930. See "The American Consumer Market," 1932, Table 23, p. 37, published by The Business Week.

"The weighted average income for 1930 was corrected to the 1934 general price-level by multiplying

by -' (from Farm Economics, N. Y. State Coll. Agr., Cornell Univ., June, 1934, p. 2073). (Sources of Data in Table 6, page 109)

ui HX iiiuusinee.

The number of families in the area using mechanical refrigeration is based on a survey made by the Union Electric Light and Power Company of St. Louis.

The number of families in the United Stalei using some kind of refrigeration is quoted from a statement by W. S. Shipley in the Refrigerating World, October, 1933, p. 5.

(Sources of Data in Table 13, page 139)

Baltimore. Information furnished by J. M. Lescure, Director, Bureau of Milk Control.

Boston. Health Department, city of Boston, "Regulations for the Care and Sale of Milk," Art. 6 and Art. 12, Sec. 2 and Sec. 8. Maximum bacterial count after pasteurization also fixed by Massachusetts statute.

Buffalo. Information furnished by the Board of Health.

Chicago. Information furnished by Herman H. Bundesen, President, Board of Health.

Cleveland. Cleveland Sanitary Code, Amendment 9, Sec. 451, para. H.

Detroit. Information furnished by Russel R. Palmer, Chief Milk Inspector, Department of Health.

Los Angeles. Information furnished by Wm. Veit, City Veterinarian, Department of Health.

Milwaukee. Milk ordinance of the city of Milwaukee, Sec. 780.

Minneapolis. Milk ordinance of the city of Minneapolis, Sec. 2 (B), para. 1, and Sec. 11, para. 11.

New York. City of New York, Board of Health, "Regulations Governing the Production, Handling, etc., of Milk," Regulation 79.

Philadelphia. Information furnished by Edward E. Behrens, Supervisor of Cattle, Food, Meat, and Milk Inspec- tion, Bureau of Health.

Pittsburgh. Information furnished by Leicester Patton, Assistant Superintendent, Bureau of Food Inspec- tion, Department of Public Health.

St Louis. Milk ordinance of the city of St. Louis, Sec. 27 (b).

San Francisco. Information furnished by Board of Health.

182 BULLETIN No. 412 [.April,

QUESTIONNAIRE SENT TO PRODUCERS MARKET ADMINISTRATOR

UNITED STATES MILK LICENSE NO. 35

ST. LOUIS MILKSHED

3688 CHOUTEAU AVE.

ST. LOUIS, MO.

June 15, 1934 MR. JOHN SMITH EDWARDSVILLE, ILLINOIS

Answers to the following questions will furnish information necessary for a study of the St. Louis Milkshed. Answer each question and return in enclosed stamped envelope not later than June 20, 1934.

1. What is the name of the dealer who buys your milk? Dealer

2. What is the name of your hauler? Hauler

3. What is the name of the station or plant where your milk is Station received? or plant

4. How many miles from your farm to the plant or station

where your milk is received? Miles

How much of this distance is hard road? Miles

How much of this distance is gravel road? Miles

How much of this distance is dirt road? Miles

5. How much per 100 pounds are you now paying for having Cents per milk hauled from your farm to the milk plant? 100 pounds

6. How many cows are you now milking? Cows

7. How many dry cows do you have? Cows

8. How many two-year-old heifers, which have not calved, are Two-year on the farm which you operate? old heifers

Yearling

9. How many yearling heifers on the farm which you operate? heifers

10. How many heifer calves less than a year old do you have, Heifer

which you are raising to produce milk? calves

1935] ST. Louis MILK PROBLEMS 183

TABLE LIST OF TABLES AND CHARTS PA01

1. Daily consumption of milk in 14 U. S. cities 96

2. Incomes of St. Louis families calculated from rentals 100

3. Per-capita consumption of milk by income-groups, St. Louis, 1934 101

4. Changes in retail delivered milk prices, St. Louis, 1925-1934 102

5. Evaporated milk consumption in 15 U. S. cities 106

6. Refrigerating facilities, St. Louis and U. S., 1933 109

7. Theoretical consumption of milk in St. Louis, by nationality and race,

1934 110

8. Prices of farm products, including grains used in dairy ration, St. Louis

milkshed, 1925-1934 120

9. Dairy cattle population and milk production, St. Louis milkshed, U. S.,

and Illinois, 1934 123

10. Volumes of different classes of milk purchased by distributors, St. Louis,

July, 1934 132

11. Handling margins on Class I sales units, St. Louis, July, 1934 134

12. Average handling margin on wholesale quarts, Boston and St. Louis, 1934 134

13. Bacteria permitted, before and after pasteurization, 14 cities, 1934 139

14. Average returns per cow as related to volume of butter fat 143

15. Milk production of group of New York dairymen under weighted aver-

age price plan, 1922-1930 149

16. Transportation differentials, St. Louis dairy district, 1934 152

17. Equilization fund in operation, an example 153

(Appendix, detail tables)

18. Population and consumption of milk, 14 U. S. cities, 1934 161

19. Population of milk sales areas, 14 U. S. cities, 1934 162

20. Family incomes and milk consumption, St. Louis, 1934 163

21. Racial population by Census districts, St. Louis, 1930 164

22. Indexes of retail food prices, St. Louis, by months, 1925-1934 164

23. Average retail prices of evaporated milk, St. Louis, 1925-1934 165

24. Price differentials, whole and evaporated milk, St. Louis, 1925-1934 165

25. Average farm prices of twelve farm commodities, St. Louis milkshed,

1925-1934 166

26. Cost of St. Louis dairy ration, 1925-1934 172

27. Milk values in relation to cost of dairy ration, St. Louis, 1925-1934 172

28. Average daily butter prices, Chicago, 1919-1934 172

29. Average net milk prices f.o.b. country plants, St. Louis, 1909-1934 173

30. Gross milk prices f.o.b. country plants and city plants, St. Louis,

1933-34 174

31. Average milk prices, Greenville condensery, 1909-1934 175

32. Dairy cattle population and milk production, St. Louis milkshed,

1933-34 176

33. Dairy cattle on farms in U. S. and Illinois, 1920-1934 177

34. Distribution of dairy cattle by farms, St. Louis milkshed, 1934 177

35. Milk production of Sanitary Milk Producers and of nonmembers,

1933-34 178

36. Seasonal variation of Sanitary Milk Producers and of nonmembers,

1933-34 178

37. Average daily production per producer, by counties, St. Louis milkshed,

1933-34 179

38. Number of producers, St. Louis milkshed, 1933-34 180

39. Average daily milk production per farm, by 8,232 producers in St. Louis

milkshed, 1933-34 180

40. Total milk production and Class I sales, St. Louis, 1933-34 181

184 BULLETIN No. 412

FIG. PAGE

1. Map of St. Louis milk sales area 94

2. Milk production by counties in St. Louis milkshed 95

3. Per-capita consumption of milk in St. Louis Census districts 96

4. Map, city of St. Louis, showing areas surveyed 98

5. Additional income from greater milk consumption 99

6. Family incomes in St. Louis by Census districts 100

7. Relation between incomes and milk consumption, St. Louis Census

districts 102

8. Changes in retail food prices and milk prices, St. Louis, 1925-1934...... 103

9. Price indexes of 16 foods, St. Louis, 1934 104

10. Changes in evaporated and whole-milk prices, St. Louis, 1925-1934 105

11. Difference between evaporated and whole-milk prices, St. Louis, 1925-

1934 105

12. Increase in use of evaporated milk with widening of price differentials. . 107

13. Evaporated milk prices, Chicago and St. Louis, 1925-1934 108

14. Average summer temperatures in 14 U. S. cities 108

15. Relation between refrigeration facilities and use of fresh milk 109

16. Differences between retail wagon prices and store prices of milk,

Boston, 1922-1933 112

17. Population of St. Louis Census districts, 1930 115

18. Families on relief in St. Louis Census districts, 1934 116

19. Changes in wholesale prices, U.S. and other countries, 1924-1934 117

20. Index of farm food prices in U. S. compared with St. Louis milk

prices, 1910-1934 118

21. Milk prices in relation to cost of dairy ration, St. Louis milkshed,

1925-1934, by years 119

22. Milk prices in relation to cost of dairy ration, St. Louis milkshed,

1925-1934, by months 120

23. Changes in Chicago butter prices compared with changes in factory

payrolls, U. S., 1919-1934 121

24. Cattle price and production cycles, U. S., 1873-1934 122

25. Whole-milk prices at St. Louis country plants compared with con-

densery prices, 1909-1934 124

26. Monthly sales and surpluses of whole milk, St. Louis dairy district,

1933-34 126

27. Seasonal variation in milk production of two groups of dairymen, St.

Louis milkshed, 1933-34 127

28. Seasonal variation in milk production of dairymen paid on basic-

surplus plan and dairymen not so paid 128

29. Seasonal variation in sale and production of milk, St. Louis, 1933-34 129

30. Seasonal production of producers shipping milk 9 months or less and

producers shipping 10 months or more 130

31. Proportions of Class I milk sold thru retail and wholesale outlets, St.

Louis, July, 1934 132

32. Proportions of Class I milk sold in the principal sales units, St. Louis,

July, 1934 133

33. Returns per cow as related to volume of butterfat 142

34. Average daily increase in milk production of group of New York dairy-

men under weighted average price plan, 1922-1930 148

35. Map showing country shipping stations and transportation zones, St.

Louis milkshed, 1934 151

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