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BOSTON PUBLIC LIBRARY 



3 9999 06317 399 9 

OFFICE OF NATIONAL RECOVERY ADMINISTRATION 
DIVISION OF REVIEW 



FERTILIZER INDUSTRY PRICE FILING STUDY 



By 
SIMON WHITNEY 



WORK MATERIALS NO. 67 



Special Studies Section 
March, 1936 



9815 



OFFICE OF NATIONAL RECOVERY ADMINISTRATION 
DIVISION OF REVIEW 



FERTILIZER INDUSTRY PRICE FILING STUDY 
By 
SIMON iJHITHBY 



Special Studies Section 
March, 1936 



'•*■*' ^O^aZ. crJ A&/ryisur»>tjeA^cjis 



*"*# 



j o s n o a d 



This study of pricing practices in the fertilizer 
industry and the operation and effects of price filing under 
the Code of Fair Competition for the Fertilizer Industry was 
prepared by Dr. Simon TThitney of the Special Studies Section, 
Mr. G-. C. Gamble in charge. Acknowledgment is made of effect- 
ive cooperation "by those in charge of the Fertilizer Industry 
Study. The data for the report were furnished by the repre- 
sentatives of the National Fertilizer Association, whose price 
files were made readily accessible to the staff. 

Although the industry is one in which the large 
number and small size of competitors would seem to make 
success of cooperative action, including price filing, less 
likely than in more concentrated industries, the facts (l) 
that price schedules were interchanged and filed as public 
documents, and. (2) that one had reason to believe that 
the prices so filed were the true market prices prevailing 
in the industry, dispelled false reports, secrecj'- and ig- 
norance of the true facts and enabled producer, distribu- 
tor and consumer to act intelligently in making business 
decisions, particularly with respect to matters involving 
price and pricing ora.etices. 

The review of the record contained, in the follow- 
ing pages should constitute a valuable contribution to our 
understanding of the operation and effects of price filing. 

At the back of this report will be found a. brief 
statement of the studies undertaken by the Division of 
Review. 



L. C. Marshall 
Director, Division of Review 



March 14, 1936 



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FERTILIZER INDUSTRY PRICE FILING STUDY 
Table of Contents 

SUMMARY 1 

Chapter I 
INTRODUCTION 5 

Chapter II 
OPERATION OF PRICE FILING 10 

Chapter III 
COMPETITION AND COOPERATION 19 

Chapter IV 
EFFECT ON PRICES 27 

Chapter V 
EFFECT ON DISTRIBUTION 36 

Chapter VI 
EFFECT ON TERMS OF SALE 41 

Chapter VII 
GENERAL RESULTS 44 

Appendix I 
METHODS AND FURTHER RESEARCH 49 

Appendix II 
EXHIBITS 51 

Appendix III 
TABLES AND EXHIBITS 65 



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List of Tallies 
Table p age 

1. Number of companies selling in each Zone, Zones 1-12 66 

2. Number of schedules filed, Zones 1-12 67 

3. Humbcr of schedules filed by each company, Zones 5, 6, 83 

and 8C 69 

4. Number of companies selling to one and several zones 70 

5. Month of first and last filing, Zones 5, 6 71 

6. Detail in price schedules, 1928, 1933 and 1925, Zone 5 72 

7. Delays in meeting price changes, Zones 5, 80 and 12B 73 

8. Price leaders, Zone 1-12 76 

9. Price leaders, Zones 1, 2, 5, 8B, 8C 77 

10. Size of companies meeting competition, Zone 6 82 

11. Delays in meeting competition within waiting period, Zone 5. 83 

12. Price indexes, fertilizer, materials and other products, 
1933-1935. 84 

13. Fertilizer costs and net receipts to producer, 1933-1934.... 85 

14. Consumer's list and cash prices, 3-8-3 and 4-8-4, Zones 5, 

8B and 8C 36 

15. Trend of list and cash prices to "tynical" buyers, 4-8-4, 

Zone 5 87 

16. Consumer's list and cash prices, 4-8-4, Zones 1-12 88 

17. Distributor's list and cash prices, 4-8-4, Zone 1-12 89 

18. Uniformity of list prices, 3-3-3, Zone 5 90 

19. Uniformity of cash prices, 3-8-5, Zone 4C 91 

20. Uniformity of prices, 3-9-3, Zone 6 92 

21. Uniformity of prices, first schedules filed, Zones 8C, 9.... 93 

Exhibit 21-A . 

Schedules withdrawn, Zones 4C, 5, 83, SC, 11 94 



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Table Page 

22. Dealers' and consumers' list and cash prices 98 

23. Consumer's list -orices of materials, Zones 5, 8B 99 

24. Theoretical derivation of saving from home mixing Zone 5.100 

25. Extras on tobacco grades, Zone 5 101 

26. Special mix charges, Zone 5 102 

27. Grade differentials, Zone 5 103 

28. Price basing methods, Zones 1-12 104 

29. Inter-state selling, Zone 5 105 

30. Freight absorbed by nine large companies, 1935 106 

31. Prices and freight rates from Baltimore 107 

32. Trucking allowances, Zones 1-12 108 

33. Trucking allowances and freight rates, Zone 5 109 

34. Comoarative consumer's list prices, 3-8-3 110 

35. Inter-zone price changes • HI 

36. llumber of grades quoted, Zones 1-12 112 

37. Number of grades quoted, Zones 4C, 5, 6, 8, 9 113 

38. llumber cf grades quoted, Zone 5 114 

39. Changes in price schedules, March 1-7, 1935, Zone 5 116 

40. Change from dealer to agency system, Zones 1-12 117 

41. Dealers and agents, Zone 8B 118 

42. Agent's compensation, Zone 5 119 

43. Agent ' s compensation, Zones 1-12 120 

44. Percentage of credit sales, Zones 1-10 121 

45. Cash discounts, Zones 1-12 122 

Cash discounts, Zone 5 123 

Exhibit - 45-A 123 



-IV- 

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Table Pago 

46. Quantity discounts, Zone 5 124 

47. Consumers' quantity discounts, Zones 1-12. 125 

48. Bag extras, Zone 5 126 

49. Carload discounts and less than carload charges to con- 
sumers, Zone 5 127 

50. Uniformity in prices and terms of sale, February 4, 1934, 
Zone 5 128 

51. Uniformity in prices and terms of sale, April 1, 1935, 

Zone 5 129 

52. Tax tag sales classified by size of company, four states.. 130 

53. Changes in consumer's prices and terms, June 1935 131 



-v- 
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-1- 
sumliary 

c^ipter i. 

1. This study deals with the pricing practices in the fertilizer 
industry and the operation and effects of price filing under the Fertlizer 
Code; it is based on the price schedules filed with the National Fertilizer 
Association. 

CHAPTER II. 

1. Each producer was required to mail a complete schedule of his 
prices and terms of sale (except on sales to other producers) to all com- 
petitors selling I7i thin the same zone (of which there were twelve) or sub- 
zone, and simultaneously to file a copy With the Association. 

2. The Secretary of the Association "accepted" all schedules filed 
and mailed out daily list 3 of schedules received currently, mentioning 
any inconsistencies with the "Regulations" issued by the code authority. 

3. The regulations prescribed in detail the form and content of 
schedules, with the object of making producers disclose their pricing 
practices., fully. 

4. Large and small producers alike filed schedules w the latter only 
once or twice in each selling season ( January-April) . 

5. A complete schedule had to be filed when any change in terms was 
made (although not when grades were added or withdrawn), the labor and ex- 
pense of which may have tended to discourage changes. 

6. The requirement that schedules be mailed to all producers within 
the zone discouraged small companies from selling into the borderline coun- 
ties of neighboring zones. 

CHAPTER III. 

1. The purpose of price filing was to inform all competitor 1 :, of all 
prices current in the market; the chief practical benefit desired was the 
stabilization of prices. 

2. The Association always considered the filed schedules public docu- 
ments, open to any one to inspect; it is not known whether customers took 
advantage of this, but they had little incentive to go to a code authority 
zone office to inspect schedules in any case. Abbreviated lists, however, 
not schedules of the kind going to competitors, were actually sent out by 
producers to customers. 

3. The large companies sometimes discussed prices and terms; the 
small companies followed the terms of the large ones with few or no devia- 
tions. 

4. Committees of producers in each zone, under authority of the code, 
recommended uniform marketing rales to the code authority, which passed 
them on to iJRA; although none was approved, the result tended to be uniform- 
ity in actual practice. 

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5. The code authority regulations likewise tended to standardize 
selling practices, and through them terms of sale. 

6. The Association acted impartially, throughout, neither favoring 
any group within the industry nor attempting to influence the action of 
any company. 

7. Price leadership is well developed in the industry - one large 
company being the leader in the South and another in the Northeast, with 
other companies both large and snail, making independent chcngos occasion- 
ally. 

8. Price changes were not allowed to become effective until ten days 
after filing, unless filed to meet the competition of another company, in 
which case they could become effective on the same date. The big companies 
usually filed to meet the competition of the price leader within ten days, 
but the smaller companies met the changes which occurred during the slack 
selling season (as most of them did) at their leisure and were thus unaffect- 
ed by the requirement of a waiting period. 

9. The purpose of the waiting period was to insure full knowledge lay 
all producers of all prices at all times, allowing each company plenty of 
time to decide what action to take when changes occurred. There is no in- 
formation available as to its misuse for either "coercion" or "collusion" 
- e.g. most of the withdrawals of schedules before the effective date were 
for technical reasons. 

CHAPTER IV. 

1. Prices of mixed fertilizers rose under the code more than fertili- 
zer materials, but less than other finished products. The price to farmers 
rose much less than the net receipts of manufacturers (which increased "by 
one-third), the dealer's margin being reduced proportionately. 

2. The code period was so short that a statistical analysis of price 
flexibility cannot be made. It is clear, however, that prices were not 
"rigid. " 

3. The price uniformity shown by the later schedules was much greater 
than that in the earlier schedules; but it is understood that prior to the 
code actual (although not formal) uniformity existed - i.e. wherever a com- 
pany found itself being undersold it would give the necessary discount to 
obtain the trade. Moreover, some of the differences in the first schedules 
filed were merely due to differences in methods of quotation. Uniformity in 
both prices and terms was increased by the NRA. interpretation that a schedule 
did not "meet the competition" of another as required to avoid the ten day 
waiting period, unless the terms to the buyer were exactly the same. 

4. The evidence does not show whether home mixing of fertilizer by 
farmers increased under the code, although the more rapid rise in fertili- 
zer prices than in material prices indicate, without proving it, that home 
mixing may have become more profitable. 

5. In 1933 fertilizer was generally quoted on a "delivered to the 
dealer's railraod station" basis, although some zones used an F.O.B. plant 

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system; in 1934 most zones went t over to a "delivered to the farm" "basis. 
The delivered price system involves an extra, charge to nearby cons"amers 
for rail shipment not required by. them and the "gift" of transportation 
to distant consumers. 

6. There were always some companies from outside each zone selling 
into it, and some companies within it selling outside, hut there is no 
evidence that cross-hauling was an evil in the industry, 

7. Trucking allowances to customers were reduced helow the railroad 
mileage for the same distance in most zones, soon after the adoption of the 
code, resulting in complaints by the American Truckers Association. 

8. Price differences between zones were due either to relative dis- 
tance from manufacturing center's or relative intensity of competition. 
Price movements commonly spread within a month or two through most of the 
Southeastern States. 

CHAPTER V. 

1. By NBA action the number of "analyses" of mixed fertilizer which 
could be sold was reduced in nine southeastern states. The number of grades 
quoted for sale by individual producers tended to increase in other states, 
partly because it was advisable to list all grades, additions not being 
permitted without ten days' notice. 

2. Prior to the code most companies sold to independent dealers or 
direct to large farmers. In 1934 nearly all went over to the consignment 
method of distribution, the dealers becoming agents handling the goods on 

a commission basis. One price was at first quoted to consumers, regardless 
of their size, and any advantage to a consumer in buying direct was elimina- 
ted. 

3. Government purchasers were allowed special discounts.. Executive 
Order 6767, which allowed price cuts up to 15 percent to government bodies, 
was effective at times and in certain zones, but not universally. 

4. There has apparently been no special complaint by dealers against 
the change to the agency system, but there were a few complaints against 
the reduction in the distributor's margin under the code. 

CHAPTER VI. 

1. In the South the cash discount sca.le for carload consumers was re- 
duced under the code; that for smaller consumers, agents, and dealers was 
increased. 

2. Quantity discounts were written into all price schedules early in 
1934 as a result of Administrative Order 57-3, adopted after protest by 
large consumers against the loss of their previous differential, for buying 
direct. Quantity discounts were granted to both agents and consumers, and 
generally depended on the amount bought in the entire season, from all pro- 
ducers - a feature intended to aid the small producer to keep his customers. 

3. Terms of sale were in general fairly uniform within a zone and be- 
tween different zones, although there were always a number of deviations 
effective and in process of being filed. 

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_4- ' 
CHAPTER VII. 

1. There were many violations of the open price provision - i. e. 
sales at deviations from published prices. The code authority was at 
first able to correct these, but by Spring of 1935 it had become clear 
that it could inflict no penalty. Violations, therefore, increased. 

2. Small producers benefitted under the open-price, as appears from 
(a) letters of commendation from them and absence of complaints; (b) the 
establishment of many new companies and revival of many which had failed; 
and (c) tax tag sale figuresin four States showing that gales of small com- 
panies, increased more rapidly than sales of large companies. 

3. The price filing plan was popular with producers in the industry, 
no dissenters having been discovered either in the KRA correspondence 
files or in field trips. 

4. As soon as the code became ineffective, drastic price reductions 
were made. The same uniformity of prices and terms continued, however. 

5. The industry has pending before the Federal Trade Commission a 
voluntary code, which includes a price filing plan without a waiting per- 
iod and without a prohibition of deviations from filed prices (although 
such deviations must be reported after the fact). 

6. On the whole, the price filing plan was successful in eliminat- 
ing ignorance of the market and discrimina.tion; and such defects as (a) 
elimination of a price differential beti?een large and small companies to 
the disadvantage of the latter; (b) unwillingness to cut prices, since 
the cut would at once be met by competitors; and (c) difficulty of en- 
forcement, were not very serious in this industry. 



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C HAPTER I 
INTRODUCTION 



I, SUBJECT 03 1 THE STUDY 

The subject of this report is the experience of the fertiliz- 
er industry under the system of "ouen prices" , or "-price filing." 
This system was put into operation at the effective date of the Code 
of Eair Competition, November 10, 1933, and continued until the 
Supreme Court decision in the Schechter Case, May 27, 1935. During 
this period members of the industry were required to file their price 
schedules with the National Fertilizer Association (*) and also to 
mail them to all competitors in the same "zone." This represented 
the first experiment of the industry in ooen pricing. 

The ooject of the present inouiry is to answer these Questions: 
"what are the pricing practices in the fertilizer industry as reflected 
in the filed schedules? 'i/hat effects did price filing have on prices, 
terms of sale, and methods of selling in the industry? Was it ben- 
eficial or injurious, and should it serve as an example or a warning 
to other industries? 

II, SOURCES 

The principal source of the material in this report lias been 
the file of price schedules kept by the Association. Some 12,000 
schedules were actually filed under .the code and perhaps two-thirds 
of them "ere loaned to this unit. Some of the ommissions in the 
present report, as well as instances of excessive detail, are due 
to its origin in a desire to analyze the fertilizer price files and 
to the fact that other sources were used only secondarily. The 
most useful of these other sources have been: (lj Interviews with 
officers of the Association; (**) (2) interviews' with members of the 
industry and customers, on field trips in Maryland and Virginia; (3) 
publications and releases of the Association and the closely affil- 
iated Code Authority (known as the Fertilizer Recovery Committee); 
(4) speecnes and articles, principally by the Secretary of the Asso- 
ciation, Charles J. Brand; (5) price data from the Department of 
Agriculture and the Bureau of Labor Statistics; and (6) VERA files. 
The MA files were in no sense covered, their search halving been 
left to the Industry Studies Section of the Division of Review, 

III, RELATION TO OTHER STUDIES 

The .present report, as was indicated in the preceding paragraph, 

(*) This is the national trade association in the industry, founded in 
1925 by a consolidation of trade groups. It is called hereafter 
"the Association." 

(**) Information was obtained especially : r rom Charles J. Brand, E.S. 
Lodge, D..S. ifriroh, and K. R. Smnlley. 

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does not attempt to give a complete picture. It does not survey 
"broadly either the problem of open nrices or the experience of the 
fertilizer industry under ERA these subjects having been assigned to 
two other units in the Division of Review - the price filing unit 
of the Trade Practice Studies Section, and the fertilizer unit of 
the Chemical group of the Industry Studies Section. Since this last 
Unit has made the most careful study of the MA files, many admin- 
istrative and other aspects of the fertilizer open price plan it- 
self are left to it to discuss at its will. 

The present report was written independently of the other re- 
ports being prepared in the Division of Review and does not draw 
on them for dat a.. 

IV. INDUSTRY BACKGROUND 

A. Definition of the Industry 

Since another unit is expected to describe the fer- 
tilizer industry in detail, only the features essential 
to an understanding of the open price plan will be treat- 
ed here. According to the code, 

"The term 'fertilizer industry 1 as used herein 
includes the importation, production and/or 
distribution of mixed fertilizer, superphos- 
phate, and/or other fertilizer material. "(*) 

As the code goes on to state, however, it does not cover 
the actual production of fertilizer materials other than 
superphosphate, nor the distribution of any product at 
all to members of the industry - but only to the 50,000 
dealers and two million or more consumers. Thus the eight 
to nine hundred companies manufacturing mixed fertilizer, 
all of which likewise distribute materials to dealers and 
farmers, are included. Importers and producers of ferti- 
lizer materials other than superphosphate however, are 
included only to the extent that they sell to dealers and 
consumers (a minor part of their business). 

. B. Materials and Products 

Many materials can be used for nlant food, but three 
groups are overwhelmingly predominant - nitrogen carriers, 
phosphate rock, and potash. These three types of material 
are combined to form the staple mixed fertilizers of com- 
merce. Thus grade '13-8-3" is a fertilizer which contains 
3 percent nitrogen, (**) 8 percent phosphoric acid, and 



(*) Article II , Section I of the Code for the Fertilizer Industry, 
Codes of Fair Competition, Volume II, p. 123. . 

(**) In some States the content is .3 percent, ammoni.a, which is 
equivalent to 2.47 percent nitrogen. 

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3 percent potash. This particular grade is the most 
popular especially in cotton culture supplying 14 percent 
of the total sales in the year 1933-34, while grade 4-8-4 
(which is sold in more states) supplied 11 percent. (*) 
hitrogen is classified, into inorganic (nitrate of soda, 
sulphate of ammonia, etc.) and organic (tankage, blood, 
fish scrap, cottonseed meal, etc.). Phosphoric acid is 
supplied by superphosphate, which is made by treating 
phosphate rock with sulohuric acid. As can be seen from 
the code definition cited above, superphosphate (although 
actually a material) is usually named as a separate cat- 
egory in deference to its intermediate position between 
phosphate rock and nixed goods. 

Materials and superphosphate are often sold in un- 
mixed form, both because some farmers like to do their 
o^n mixing and because only one material may be needed for 
a certain soil or crop. More than two-thirds of the plant 
food consumed in the United States, however, is sold in 
mixed form. (**) 

A striking feature of this industry is the large 
number of formulas or grades of mixed fertilizer sold by 
the manufacturers - ruining to more than a thousr-nd and 
resulting in a great deal of waste. 

C. Distribution 

Fertilizer companies sell a substantial portion of 
their products (but much less than half) direct to consumers- 
partly through wholesale or retail farm cooperatives. The 
rest of the supply, barring a small fraction sold to whole- 
salers, is distributed either through independent retail 
dealers who buy the fertilizer outright or through agents 
working on a commission basis. Both dealers and agents 
usually handle the product of several manufacturers, and 
nearly all of them deal in feed and other farm supplies 
as well. 

The great bulk of fertilizer consumption and sales 
is concentrated' in the planting season.- From 1926 through 
193?) sale of the tax tags which must be attached to ferti- 
lizer bags in many states and which are ait least a rough 



(*) Mehring, A. L. and Smalley, H.E.: -"A Survey of Fertilizer and 
Plant-Food Consumption in the United States for the Year end- 
ed June 30, 1934", Proceeding of the Eleventh Annual Conven- 
tion of the National Fertilizer Association (1935), p. 145. 

(**) Ibid, .pp. 179, 191. 



9815 



measure of fertilizer shipments (*)' was divided as follows: (**) 

January 9.5 percent 

February 13.9 " 

March 33.5 " 

April 21.0 " 

May-December 22.1 " 

D. Large and Small Ccrrpanies 

Some of the fertilizer companies are partially integrated, since 
they own phosphate rock deposits or possess their own sources of nitrogen - 
e.g. the Armour Fertilizer Works and Swift and Company Fertilizer Works 
which draw organic nitrogen fnm the affiliated meat packing corporations. 
In recent years the markets for the chief raw materials have been so de- 
pressed that integration was doubtless of little advantage. A much larger 
number of companies, some 200 in all, purchase their materials but manu- 
facture superphosphate, and go under the name of "wet mixers." The 600 
or more "dry mixers" purchase their superphosphate. 

Six companies stand out as the largest - The American Agricultural 
Chemical Corporation, International Agricultural Corporation, F. S. Royster 
Guano Company, Virginia-Carolina Chemical Coporation, and the Armour and 
Swift Fertilizer groups. It is generally believed that the fraction of 
the country's "tnisiness done by these firms is not far below one-half; but 
complete figures on production and sales are not available. (***) 



\,*) It is understood that an analysis of this correlation is being 

made by the Fertilizer Unit, Chemical group, Industry Studies 
Section, Division of Review. 

(**) "Investigation of the National Recovery Administration", Hear- 
ings before the Committee on Finance, United States Senate, 
74th Congress, First Session, Pursuant to S. Res. 79, page 1759. 
The figures are for 13 southern states. 

(**) Only a few of the States which sell tax tags keep records of the 
purchasers. The Association has made available to this Unit 
data which it gathered for Alabama, Florida, Georgia, and South 
Carolina. The figures for the four States end in 1935, 1932, 
1935, and 1933, respectively. Combining them for the most 
recent years, it appears that the "big six" did only 36 per cent 
of the business. An effort was made to secure additional data 
from the State Governments for the NRA study but it proved impos- 
sible. It has been estimated that 70 to 73 percent of the nation's 
business is done by 20 companies (Senate Hearings, loc . cit . . 
note (**) above, pp. 1735 



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_o_ 



Nearly all the manufacturers, whether large or small, sell "both mixed 
goods and materials, and it is not believed that any one branch of the 
trade more than another is dominated by the large concerns. 

E. The Southern States 

One of the most striking characteristics of the Fertilizer 
Industry is the importance of the southern states. Factories are 
located all along the Atlantic Seaboard ( and inland in fewer cases ), 
buL.they are most thickly scattered in the South. Much more fer- 
tilizer is applied to the cotton crot> than to any other. The six 
largest consuming States - Virginia., the Carolinas, Georgia, Florida 
and Alabama - used 3,11F,0C0 tons in 1933-34 or 56 percent of the 
total. (*} For this reason, most of the detailed analyses made in 
the course of the present study were for southern districts. 

(*) 'lehring and Smalley, loc . cit . , note page 7, _ 140-142 



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CKAPTBR ir ■ 

OPERATION OF PRICE FILING 

I. CODE PROVISION 

The fertilizer code contained two price clauses - one forbidding 
sales below individual cost except to meet competition, and the open 
price provision (*) which concerns us here. Under this provision, 
(using its lettering): 

a. By November 15 (1933) each producer was to file with 
the Secretary of the Association 

1. A statement of the zones in which he in- 
tended to sell; . • 

2. A schedule, for each such zone, showing 

his prices and terms of sale to distributors 
and consummers (not to other producers); 
and he was also to 

1 '. i ' - 

3. Deliver copies of such schedules to com- 
petitors within such zone. 

b. If any schedule represented a change in terms it was L 
not to become effective until 48 hours after filing. No 
sales were to be made except at filed prices. 

c. No later changes were to become effective until 10 days 
after filing and unless, simultaneously with filing, copies 
were delivered to all competitors in the zone in question - 
except that those filed to meet a new schedule of a com- 
petitor might become effective at the same time as the com- 
petitor's if filed at least 48 hours prior to such time. 
All filed schedules were to be open to inspection by any 
producer. 

d. On receiving each schedule, the Secretary was to mail 

a notice of its receipt and effective date to each competitor. 

e. Each schedule was to have a list of the changes contained 
in it attached. 

As originally submitted, on August 2, 1933, the provision had been 
different to two respects; (l) The last clause had required not only 
that changes be listed but that "the reasons therefor" be stated; and 
(2) there had been an additional clause to the following effect: 



(*) Article VI, Section 2 of the Code for the Fertilizer Industry, 
Codes of Fair Competition, Volume II, pages 127-128. 



9815 



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"Any new or changed schedule shall only be issued or made 
as a result of legitimate and general changes in market 
costs of materials or manufacturing costs or to meet a 
general competitive condition, and not to obtain some 
special trade advantage not consistent with the spirit of 
this Code." 

After a conference with the ^e'puty Administrator and representa- 
tives of IJEA boards, on August 15, these phrases were dropped. Thus, 
the purpose to discourage price changes was eliminated from the price 
filing plan as adopted, in favor of mere publication. 

II. ZONES 

In pursuance of authority given it by Article III , Section 3 of 
the code, the code authority divided the country into twelve zones, 
and shortly divided seven of there into subzones. Most of the bound- 
aries followed those used by the Association for many years in its 
administrative work. The principal changes were the shifting of 
Virginia north of the James River from the North Carolina to the Mary- 
land zone, the splitting off from the Florida zone of two pieces - 
one to be attached to the G-eorgia and the other to the Alabama zone - 
and the zoning for the first time of twelve Western States which consume 
little fertilizer. The more careful, delimitation of zones under the 
code was due to the requirement that producers mail price schedules 
to all other producers within their zones and the resulting necessity 
of establishing truly competitive areas. The crop grown and freight 
rates were the nrincioal factors in setting up zones. 

The zone' structure as revised in April 1934 was as follows: 

Zone 1: New England. 

Zone 2: New York, Pennsylvania, New Jersey, and 

: Puerto Rico. 
Zone 3: Maryland, Delaware, and the Northern parts 

of Virginia and West Virginia, 
Zone 4: The rest of the Virginias and North Carolina.. 
Zone 5: South Carolina'. 

Zone 6: Georgia and North Central Florida. 
Zone 7: The Florida peninsula.. 
Zone 8: Tennessee, Alabama, Mississippi, Northwestern 

Florida, and -^astern Louisiana. 
Zone 9: Arkansas, Texas, Oklahoma, New Mexico, 

and Western Louisiana. 
Zone 10: Sixteen Middle Western and Northwestern 

O "C cl Xi G S * 

Zone 11: Washington, Oregon and Idaho. 

Zone 12: California, Nevada, Utah, Arizona and Hawaii. 

Zones 1-4, 8, 10 and 12 were further divided into subzones. 

The number of companies whose intentions to sell in the different 
zones were registered with the Association in the spring of 1935 ranged 
from 37 in Zone 1 to 159 in Zone 6 (table 1). 

Zone 5, a typical Southern zone and the only one which consisted of 
a single State, has been covered most fully in the present study; but all 
districts were surveyed in varying degrees of detail. 
9815 



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III. MECHANICS OF FILING 

The price filing plain was carried through in practice above as out- 
lined in "the code. Each producer mailed his new -price schedules to the 
Association and simultaneously to every other company which had regis- 
tered with the Association as selling in the zone or sub zone to? which 
the schedule applied and was so listed in the "Fertilizer Industry Zone 
List" issued' by" the Association. Producers were permitted to waive in 
writing the light to receive schedules'' of any given competitor, but few 
did so (*). 

On the receipt of each schedule, the Association officials checked 
it for compliance with the code and the regulations issued under it, 
then sent a (collect) telegram of acknowledgment to the company in 
question. Every day it mailed to all producers in each zone a mimeo- 
graphed "List of Filed Price Schedules" currently received. The . 
schedules received at the' Association' s offices were filed for permanent 
record; producers actually r eceived their information on the current 
market from the schedules mailed them by competitors. Some companies 
sent schedules to their dealers; but most sent abbriviated lists — 
omitting clauses which they thought would not or should not interest the 
dealer. 

A producer could if he chose file within each subzone, different 
prices and terms for different areas and could withdraw from as much 
of f he subzone as he Y/ished; but he could not have more than one price 
in affect at a given time, for the same goods, in a specific area, but 
he was obliged to specify all of this in his schedule for tne subzone, 
so that others would know just what competition they had to meet. 

The practice of exchanging price schedules directly between com- 
petitors instead of through the Association was adopted: First, to in- 
sure quick knowledge of changes, and second, to ptit the expenss of 
duplication and mailing on the individual producers - both to 'avoid 
assessment difficulties and to prevent the company ■which filed few 
and brief schedules from bearing an excessive share of the cost. (*) 
There was no complaint against the system adopted. 



(*) At first some companies mi sxinde 2 stood the rule and mailed schedules 
only to firms which they believed actively competed with them in- 
stead of to all within the zone or subzone. In one case 'a govern- 
ment agency is said to have helped enforce the Code by canceling a 
purchase contract with a firm which had failed (through misunder- 
standing) to send its lists to all producers within the zone. 

(**) Mr. Brand of the Association stated ^'another reason I felt it better 
public and industry policy to remove a danger of suspicion and 
sometimes a possible temptation to influence content of any 
schedule before distribution, if the duty of distribution had been 
imposed upon the filing agency.. 1 ' 



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IV. CONTROL 

A. Interpretations . 

One of the few steps actively taken by NRA in the administration 
of the price filing plan consisted in the issue of Interpretations 
(suggested in the individual instances by the coda authority). One 
of these, dated Lay 2, 1954, is cited here for illustration and because 
it throws light on two basic features of this price filing plan: 

"Question. We are producers and have listed prices for 

twenty different grades. A customer wants to buy a car 
of a grade that is not covered by our schedule, fey we 
sell to him at prices quoted by a competitor who makes the 
grade he wants to buy? 

"Interpretation. No. You may not sell or offer for sale 
except at the prices specified in your own schedule." 

The basic principles disclosed are these: (l) No grade could 
be offer3d for sale unless listed on the schedule; (*) and (2) No 
deviations x'rom published prices were permitted merely to meet com- 
petition (in contrast to the permission to deviate granted by some 
other price filing plans and by the sale below cost provision of the 
fertilizer code itself). 

E. Regulations . 

In conformity with the practice of a number of code authorities 
under the ERA, the Administrative Committee of the Fertilizer Recovery 
Committee (*) issued Regulations on the price filing plan. These were 
published first in letter form and then in a printed booklet of some 
20 pages. (*) They were not submitted to NRA for approval, but were 
believed legally warranted by the terms of the code - especially the 
reqxiirement that all producers file prices, "together with the terms 
and conditions", for "all grades" sold. According to the booklet: 

"Schedules not conforming to these Regulations will be con- 
sidered violative of the Code and as subjecting filers to 
having complaints filed against them." 

These regulations are here summarized: 



(*) See Chapter IV,- IV, D, for further discussion of this point. 

(**) The Administrrtion members of the Code Authority were invited 
to attend all committee meetings and at least one did attend, 
each meeting, according to the Association's officers. 

(***) "Regulations Covering the Filing of Open Price Schedules under 
the Code of Fair Competition for the Fertilizer Industry", 
National Fertilizer Association, iE.su.: of July 11, 1934. The 
first edition had appeared at the end of 1933. 



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-14- 

1. 3ach schedule shall state the zone (and subzone or part 

of subzone if any) to which it allies; a serial number; date • 
of issue; name and address of company; ha sis of "orice quota- 
tion (e.g. "consumer, delivered to farm"); prices on all grades 
"to consumers and/or dealers;" LCL (less than carlot) charge 
if any; charge for special hags or containers; charge for 
special grades (e.g. tobacco fertilizers); charge for snecial 
materials (e.g. sulphate of potash); scale on which to base 
charges for formulas not in schedule; terms; prices and terras 
to government byers; prices and terms on any private brands; 
compensation of agents; treatment of any sales tax; wharfage 
charges; prices on bulk shipments; period of delivery; allow- 
ances for trucking; whether freight is prepaid; quantity dis- 
counts; location of factories and warehouses. 

2. 3ach schedule shall be accompanied by a "Statement of 
Charges" (including grades added or withdrawn) and the name 
and schedule number of any company whose competition is being 
met ( alone with a st?,tement of variations from such other 
schedule) . 

3. Each schedule shall be coranlete in its list of terms. 

4. Indefinite phrases (li ;e " at our option",- "not more 
than", and "minimum prices") must be avoided. 

5. Incomplete and faulty schedxiles "may subject the filers 
to complaints and consequent penalties." 

6. Separate .schedules must be filed for every zone or sub- 
zone even if identical terms are used in more than one. 

7. A producer may confine his sales to part of a subzone, 
and must so state in his schedule. 

8. No sales may be made except at schedule -orices and terms. 

9. Each schedule shall be numbered. 

10. Additional grades may be listed at any time by filing a 
supplementary page. 

11-12. Schedules become effective 10 days after filing, unless 
filed to meet competition. 

13. Schedules received between 4 P.M. and 10 A.M. shall be 
filed as of 10 A.M., etc. 

14. The filer will receive acknowledgment by collect telegram 
unless he -.waives it. All producers in the zone will be notified 
by a "List of filed price schedules." The Secretary, when he 
accents a schedule, docs not thereby certify that a given comoany 
is a "producer" in the meaning of tho Code. 



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15. "The prices, terms, and conditions of the 
schedule filed to meet must be the same as those 
of the schedule being met", although any grade may 
be omitted. 

16-21. 3ach schedule shall be accompanied by a certifi- 
cate that it has been mailed to all competitors. Such 
mailing must be simultaneous, and copies must also be 
sent to the Zone Secretary. Copies must be sent by 
first-class mail, and must be on db by 11 inch paper, in 
type of at least a certainsize. 

22. A producer may file a "no-sales schedules" at any 
time to supersede his effective schedule, without any 
waiting period. 

23. 'wholesale cooperative associations shall file 
scheduler- on sales of materials when the supplying 
producer files no scnedule. When buying any product 
from a producer who file'-, it shall maintain his 
prices. 

24. A schedule may be withdrawn if the Association is 
notified 48 hours before the effective date and hour 
and if competitors and the Zone Secretary are notified 
simultaneously. A schedule filed to meet a schedule so 
withdrawn does not itself become effective. 

25. Typographical errors may not be corrected after 
a schedule lias been listed by the Association in its 
"List of Filed Price 3cne Aules. " 

26. If a producer repurchases used bags, it must be 
mentioned. 

27. Producers must comply with the orohibition of sales 
below cost. 

The effect of the regulations, especially lio. 1, was to make 
the producers disclose their pricing practices in full, thus making 
evasion of the code through the granting of indirect price concessions 
next to impossible. The Association is well satisfied with the results 
achieved in this effort. 

C. .Review of Schedules 

In January 1934 the Secretary Gf the Association, under 
instructions from the Administrative Committee of the Code Authority, 
asked HBA to approve his right to "reject" schedules which did not 
conform to the code. The Legal Division die not favor this, and the 
power was not granted. The Secretary, therefore, at the advice of 



9815 



-16- 

his own counsel, merely mentioned, irregularities in his acknowledg- 
ments and lists of schedules. The following are typical telegrams 
of acknowledgment j sent to one company in 1934: 

"Schedule 2, Zone 6, Georgia only, effective 10 A. M. 
February 10" - in which it appears that this schedule 
was the second filed by the company in question for 
zone 6, that it did not apply to Florida (although 
it was required to be mailed to the producers selling 
in the Florida section of Zone 6), and that it reached 
the Association on January 31. 

"Schedule Zone 6, meet Spalding, effective March 15, 
except items not in Spalding schedule effective 22" - 
in which it appears that this producer had accompanied 
his schedule with a statement that it was to meet the 
competition of the Spalding company but had included 
certain grades not sold by Spalding, and that the list 
had reached the Association on March 12 and the Spald- 
ing list on March 5. 

"Schedule 8, Zone G, filed meet Spalding, effective 
10 A. M. November 1 on competitive items. All sales 
Talbot, Taylor, Upson, Lamar, Monroe and Crawford 
counties and all time sales guaranteed by agent and 
non-competitive items effective 9th. Writing" - 
in which it appears that Spalding was not selling in 
these 6 counties or was selling there on different 
terms from this firm, that its time sales were not 
guaranteed, by its agents, that its list had reached 
the Association on October 22, and that the schedule 
being acknowledged arrived on October 30. 

It is apparent from the last telegram quoted that the office staff 
of the Association had to make careful study of the often lengthy 
and complicated schedules, especially to determine whether or 
they actually "met" the other firm's comoetition on specific types 
of sale. (*) 

The qualifications stated in these telegrams of acknowledg- 
ment appeared again on the mimeographed lists mailed out daily to 
all producers. 

D. Other Actions. 



In addition to dividing the country into zones, suggesting 
interpretations, and issuing regulations, the code authority com- 
piled a list; of producers by zones and sub-zones, investigated 
complaints and secured compliance pledges from violators, and 
considered recommendations made by zone committees. (**) 



(*) See Appendix II for a typical price schedule and notations by 

the Secretary. 

(**) See Chapter III, III, 3. 
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-17- 

The Association, despite its close affiliation with the 
coda authority, acted on the whole as impartially* as any "confiden- 
tial agent" of the type envisaged by NBA. Office Memorandum Ho. 228. 

V. HUM33R OF SCH3DUL3S FIL3D 

Schdulcs were filed by practically all producers as required 
by the code. During the year 1934, 7,327 schedules were receiv- 
ed by the Association - ranging from 116 in Zone 11 to 1,225 in 
Zone S (table 2). 3oth in 1934 and 1955 the greatest activity 
was in the first three months of the year, covering most of the 
heavy selling season. In zones 5, 6, 8 3, and 8 C, 421 com- 
panies (including duplications anon;; two or all three districts) 
filed 2,446 schedules, or an average of -3.8 -piece, during the 
lift of the code, (table 3). The large number of schedules filed 
by so many individual producers indicates that the price structure 
of this industry is at least not completely "rigid". 

Small and large producers alike filed prices - the small 
ones in one zone, the largo ones in several (table 4). Only two 
companies filed in every zone. The fact that three schedules or 
less were filed by about one-third of the firms (table 3) reflects 
the practice of small companies of issuing a list only in the spring 
season. The changes in prices and terms announced by the big com- 
panies during the off-season had only an academic interest for their 
smaller competitors. With regard to the companies shown by table 
3 to have filed only one list, almost without exception they were 
engaged in the fertilizer business during but one of the two selling 
seasons in the life of the code (table 5). 

VI. COMPLEXITY 07 SCHSDUL3S. 

A. Increasing Detail. 

We have seen that one purpose of the regulations issued 
by the code authority was to insure that every particular in a 
producer's selling terms be mentioned in the schedule, so that 
indirect rebates would not be possible and producers would know 
exactly what competition they 'had to meet. This had the natural 
result of increasing the number of terms in schedules and the de- 
tail of each term (table 6), through a process which should rather 
be described as clarification than merely as increasing complexity, 

3. Cost . 

The price filing plan was not operated without cost to 
its participants. One large company states that price filing re- 
quired the addition of two" persons to its staff and the letting of 
a contract for mimeographing, the total cost being "heavy." A 
small company (with net profits around $2000 or £3000) estimates 
its cost in 1934 as follows: 7 schedules, each sent to about 
100 competitors, postage 13^ rich, or $91 - the mimeographing, 
done in the office being additional. 



9815 



-18- 

. The cost of the system might have "been reduced had the 
Association not required that every change in terms (e.g. such a 
minor change as that from 8 to 7 percent in the interest rate 
allowed on cash deposits) "be accompanied "by the filing of a com- 
plete new schedule. Other industries - lime, for instance, - re- 
quired that only the changes be filed. In the fertilizer industry, 
however, it • as felt by the Association (not by all members of the 
industry) that successful administration of the plan would be ham- 
pered if each producer coiild file his changes in the form of a mere 
telegram or brief note - several of which would bury the original 
schedule beneath confusing corrections. (*) 

It has been stated by a leading member of the industry that 
one reason for the rule requiring the filing of a complete new 
schedule was the. desire to make price changes costly and difficult 
and thus discourage them. 

The labor of mailing schedules to all competitors in a zone 
had a certain effect in restricting the free flow of competition, 
geographically. One producer situated near the border of zone 
3 remarked to interviewers that prices in zone 4 had been higher 
at times, but that he was unable to sell in its Northern counties, 
(which might have contributed to equalizing prices) because of 
the labor involved in filing price lists with all of the producers 
in the zone. Another company rejected a, favorable contract from 
a friend across the zone line for the same reason. 

The cost of filing is not, however, a highly significant 
phase of the problem. The very small producers filed only one or 
two lists a year and could have devised briefer lists than they 
actually did had it been necessary. Thus the mailing cost might 
easily have been kept down to perhaps ten or fifteen dollars. 
There are, in any case, much more important issues at stake than 
that of cost, and especially this: did the price filing plan assist 
or hamper the operation of the competitive system? 

(*) "The Executive Director of the Code Authority, Mr. Brand 
takes full responsibility for insistence on this rule in 
the face of keen and sometimes unfriendly criticism from 
a minority within the industry. Competitors had no voice 
■either in the preparation or in the application of the 
rule. Advised by the expert checking and filing staff in 
his Open Price Filing Section, Mr. Brand resisted, both 
in Code Authority and in producers' meetings, an existing 
and sometimes widespread demand that general filing of par- 
tial schedules, amendments, changes, corrections,' etc. , be 
permitted. He states that his position was based solely on 
principles of fair and open competition and operational 
practicability and not on considerations involving restraint 
upon individual freedom of price action. » 



9815 



- 19 - 

CHAPTER I II 

COMPETITION ME COOPi-KATI ^ 

I. PUriPOSES OF PRICE FILING 

The only remarks mede on the price filing provision at the original 
NRA code hearing were the following: (*) 

"■The. thought back of this section is to bring out into the open 
the prices and terms asked by different producers; to require 
each producer to issue a schedule and mail a cony to his com- 
petitors so that competitors can know »vhat his .prices and terms 
are at any given time, and thus to discourage the circulation 
of false rumors, misstatements, and other misleading methods 
so often used by buyer and seller. Competition will thus be 
met with full knowledge as to the facts, and buyers will be 
given a great advantage that they do not now have " 

Another statement of the purpose of the industry in establishing 
price filing is worth quoting: (**) 

"Circulation of false reports, secrecy, ignorance of the true 
facts as to prices, terms, and conditions of sale, suspicion, 
and distrust lie at the root of m^st of the destructive competi- 
tive practices that harass business. 

"Open pricing is a device whereby producer, distributor and 
consumer may act intelligently in making business decisisions, 
particularly as to all matters that involve price. Open pricing 
does not involve, directly or indirectly, agreement upon price, 
coercion to file or observe particular prices, or action in any 
way inequitable or adverse to the consumer. 

"In the fertilizer industry the open pricing tirovisions of the 
code have profoundly and in the puolic interest decreased, fraud 
and misrepresentation, price discrimination, destructive price- 
cutting, and even what might be termed 'blood-letting' which in 
the years 1931 and 193? nearly involved industry self-destruction." 

From these and other statements made by sponsors of the plan it 
appears that its declared purpose was not to fix prices, but to give them 
fullest publicity^ The chief practical benefit expected for the industry 
from this increased publicity was greater stabilization of prices. 



(*) Stroohar, A. D. , Fresident, Southern Fertilizer and Chemical Company 
of Savannah, Transcript of Hearin-: , Fertilizer Industry Code of Fair 
Competition, September 6, 1953, p. 187. 

(**) Brand, Charles J., Transcri pt .ji Hearin,; , NHA Public Hearing on 
Prices, January 9, 1935, p, 131. 



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-SO- 
IL PUBLICITY 

A. To Producer s 

The code required that filed schedules be open to inspection' by 
any producer, but the real increase in publicity came from the direct 
interchange of schedules between competitors. Knowledge of competitive 
prices and terms thus became nearly 100 percent complete. Prior to the 
code, producers could easily obtain copies of competitive schedules or, 
if necessary, find out the terms from dealers handling both their own 
and competing products. Under the code, however, this knowledge was 
both prompter and more reliable. 

B. To Customers 

Although the code did not mention access by customers to the 
price schedules, the Association took the position throughout (although 
it did not specifically circularize customers to this effect) that the 
schedules were public documents, open to all, A very few inquiries were 
made at Washington, chiefly by Congressmen acting on behalf of constitu- 
ents. It is not known whether inquiries were made at zone offices as 
wello None of the customers interviewed on a three-day field trip, in 
Virginia complained on this point - and in fact it was evident that they 
were satisfied to receive schedules from their 'supplying companies and 
to compare these with eachother. It would not have paid to make an effort 
to obtain exhaustive knowledge. One dealer said that there was no use 
getting the prices of more than the four companies which regularly 
supplied him, since it was obvious that the other prices would be the same. 
In any event: (*) . 

» 

"Prices become known almost instantly in the fertilizer using 

territories through the publicity given by agents, dealers, local 
manufacturers, county agricultural agents, and other instrumentalities." 

III. AGREE MENT AND PERSUASION 

A. Among Producers ■ 

It is vital in the consideration of an open price plan to know 
whether or not there was agreement among the members of the industry on 
the prices to be filed. 

In the fertilizer industry, the long delays which were usual in meeting 
changes in price (table 7) show that there was at least no closely knit 
price agreement. (**) 

On the ^>ther hand, many small companies did not draw up their own 
schedules independently, but used the forms of their larger competitors 
down to the last comma. Thus one company, which wrote the Association in 



(*) Ibid ., p. 134 

(**) These delavs "-ill be discussed again in Section IV, C, of this 
chapter. 

9815 



May, 1935, on a battered typewriter, hoping that the attached price list 
would "be satisfactory and that there would be no more "trouble" over the 
matter, enclosed a seven page schedule prepared in perfect form, and 
speaking of "our factories". The schedule was evidently borrowed for the 
need that arose. Such instances, however, show rather the willingness of 
little competitors (frankly admitted in conversation) to copy big ones 
than any understanding among thenu Occasionally small companies would 
simply call up the local printer and tell him to save the forms he had 
used for the X company, since they would want the same thing. 

As for the medium-sized and larger concerns, there is no doubt that 
they discussed prices and terms in advance of their filing. Circular let- 
ters which two companies sent to tneir sales staffs after the Schechter 
decision have been examined, and may be paraphrased as follows: 

The anti-trust laws are now restored, and as a result discussion 
of "prices, terras, and conditions with competitors which can be 
construed as restraining competition" is again forbidden. You 
will please discontinue, therefore, your discussions with 
competitors* 

The interpretation of the anti-trust laws presented in this letter 
can be criticized in two respects - i.e., these laws do not forbid 
discussions of prices and terms with competitors so long as no agree- 
ment results, and they were not suspended during NEA except as to acts 
in obedience to code provisions. There is no provision in the fertilizer 
code which permitted price agreements. Regardless of these considerations, 
however, the letter illustrates the belief of many producers that the 
legal bars had been raised a little (*) 

Assuming that there were frequent price discussions, it results that 
filed prices were not always determined by each company in isolation from 
the rest. The picture of "free competition" is thereby disturbed. On the 
other hand, only p distorted nicture would be acquired by overlooking (l) 
that the' discussions did not necessarily result in agreements, although 
they may have done so (there being no direct evidence on this), (2) that 
such discussions, and indeed such agreements, have been frequently found 
in industries without price filing plans, and (3) that any faults in the 
operation of price filing under the code which may have resulted from 
agreements rather than independent decisions would not necessarily recur, 
were price filing to be practiced in the future with the anti-trust laws 
definitely in force. 

B, Zone Officials 

In each zone there were committees of producers acting on code 
problems. It would not have been astonishing if these committees had 
occasionally made suggestions as to prices to be charged. This may account 
for the reference in one price list in Zone 5 to "the committee's prices," 
On the other hand, salesmen were prone to use without authority the expres- 
sions "committee prices" or M oode prices" in order to escape responsibility 

(*) The officers of the association believe the discussions referred to 
•here may have been on subjects specifically authorized by Article VII, 
Section 7 of the code. (see pages 21-22.) 

9815 



-22- 

for the price in question. The Association many tines condemned the use 
of such expressions. (*) Whether zone committees or secretaries went "beyond 
their oroper functions in this regard cannot he known with certainty; but 
at least no oroof of it has been seen. It is stated that some member of 
the association staff attended almost all zone committee meetings, and 
that no price fixing proposal was ever discussed. 

There was one line of action by zone committees which must have had 
some effect in making terms of sale more uniform. Under the code, pro- 
ducers in each zone were given authority to recommend to the code authority 
and through it to EM: 

11 . . .uniform rules, not inconsistent with any provision 
ir/ this Code, governing the methods of auoting prices, 
methods of distribution, and methods of deliver;', includ- 
ing trucking allowances." (**) 

This unit does nob have a. complete list of the recommendations which 
resulted. Seme of the, certainly, were rejected by the code authority, 
on the ground that "it is dangerous for the He co very Committee to under- 
take to prescribe so closely in relation to pricing." (***) Others, ap- 
parently because they were considered to be, were mechanical regulations 
essential to any proper price filing plan and not to be new marketing 
rules, were inserted in the booklet of regulations instead of being sub- 
mitted to LTRA. A few were accepted by the code authority with the pur- 
pose of submitting them to NRA when the time should Drove ripe. One of 
these last, for illustration, was the ; recommendation that "sales within 
Zone 5 shall be entirely on a consumer's delivered to the farm ba.sis of 
pricing . . . " , adopted likewise by Zones 1, 4, 6, 8 and 9, at least. 
Since there is no record of NRA acion on these recommendations, it is 
presumed that they '."fere never submitted. On the other hand, the discus- 
sion and general agreement within the zones on marketing pra.ctices must 
have been a strong force making for uniformity in actual practice. Such 
changes as that to a "consumer, delivered to the farm" basis of pricing, 
while they actually occurred before the recommendation had been formulated 
in the zones, did not take place until the subject had been thoroughly 
discussed. As was stated by one price leader in defending 'its terms of 
sale to the trade: 

"A gre'at majority of these principles and methods of 
marketing have previously been endorsed by a large 
majority of the producers in the zones which they cover. " 

Although none of the recommendations actually fixed anv charge or 
price, thev were designed to standardize the method of quoting, and would 
thus have made uniform charges more likely. It must be remembered, how- 
ever, that sveh discussions and decisions were the result of the whole 
code plan rather than of the price filing plan alone. Moreover, the 
existence of a code ■■provision for the establishment of uniform contracts 
( *) See, for instance, No. 10 The fertilizer Review , p. 5 1 , (January - 

February 1935) . 
(**) Article VII . Section 7 , of the Code for the Fertilizer Industry, 

Codes of Fair Competition, Volume II, pp. 129-130. 
(***) Minutes of Tenth Meeting of Fertilizer Recovery Committee (June 9, 

1934), p. 20. 

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33- 



offered another authorised and effective means of standardizing" terras of 
sale, had the marketing recommendations not been employed. (*) 

C. Code Authority 

There is no evidence that the code- authority or Association suggested 
that any -producer file any given prices or terms. On the contrary, the 
price filing plan was administered, throughout with discretion, and the 
only suggestions made o" r the secretary were those designed, to correct vio- 
lations o^ the regulations. 

The regulations undoubtedly had an influence similar to that of the 

zone committee recommendations in r i;'-'i, ; for unif ormity in terras of sale. 
Thus the requirement that ■.n • e::tra charges to be made for using cotton 
instead, of burlap bags be mentioned had the tendency to create uniformity 
in such charges. The meanin : of this is that the regulations enforced 
complete disclosure of .rices and ti m , and that complete disclosure 
prevented many t ir jes of secret r< bates as '''el 1 i s msn ' differences in 
charges due to ignorance of the -1 market. 

IV. PRICE LEADERSHIP 

A. "heating Competition" 

The uniformity in prices and terns found under the Code arose from 
the practice of "price leaderships" In other words, it was auite usual 
for other producers to copy the schedule of the first to file a certain 
change in his terms. rhis copyii was done ,_r ith few or no variations, as 
required by the NEA ruling that ; company "meeting competition" hod to 
follow the precise terms of the price leader. (**) 

This ruling did not mean that the price leader's schedule must be 
copied word for word, out only that the full ten days had to expire be- 
fore sales could be made under the new schedule on an _r item for which the 
prices and terms to the buyer differed from those of the price leader. 

This rather drastic ruling was not adopted without opposition within 
NPA. One school of thought held Biat competttipn souldbe substantially met 
without quoting the exact price - just as in certain industries large 
companies allow others to undersell them by small differentials and yet 
keep their share of the market on the oasis of their reputations. 



(*) A rticle VII. Section o of the Code for the Fertilizer Industry , Code 
of Pair Competition, Volume II, p. 129. 

(**) NRA. Code Interpretation To. 57-3 , March 16, 1934: "Article VI, Sec- 
tion 2. Question: If a producer of mixed fertilizer wished to file a 
price schedule to meet a ne^j -> -• changed schedule filed by another pro- 
ducer of mined fertilizer, to become effective on the same date as the 
competitor's, can it be di ' ■ ■ ;. ,' 'oi -ice schedule that he is 
filing to meet? Interpretati :: ho." This was later amended to read 
that the wording of the second schedule raur.t be "the same as" that of 
the r irst. 

9815 



-24- 



B. Price Leaders 

Tables 8 and 9 give some of the price leaders under the code - that 
is, the companies named by other producers in their schedules as those 
whose competition they were meeting. In the south the P. S. Royster 
Guano Company was the principal ;orice leader, and more so than the tables 
indicate, since producers would often name another company whose compe- 
tition they were directly "meeting", but which in turn was actually meet- 
ing Roaster. In other zones, however, Royster was content to follow. 

A price leader often brings out its list some weeks before the open- 
ing of the selling season (in January), but it must be readv to replace 
it at any tire during the "season. The officer of one leading company, in 
explaining his method of establishing consumer prices, stated that he 
added to fp.c'ovy cost the average freight, throughout his whole selling 
territory to arrive at a delivered price, then added 10 percent, and fin- 
ally added agent's compensation. 

C. Price Follower s 

A very important phenomenon in connection -r ith price leadership in 
the fertilizer industry is the fret that the .average compan 1 '- does not 
meet the price leader at once, but at its leisure. Table 7 has shown 
the delays in meeting price changes in zones 5, 8-C, and 12-B. In zones 
5 and 8-C the majority of companies did not meet them until after the 
lapse of several days or weeks. In zone 12-3 a price reduction was met 
within ten da^s by just half of the competitors. 

Table 10 shows that it is the very large companies which meet compe- 
tition at once. Doubtless both their reputation and the actual sales 
they a,re making demand :that they be quoting the latest prices even in the 
slack season. 

No difference is noticeable between price advances and price reduc- 
tions as regards either the identity or type of the price leader or the 
speed of following. 

V. THE WAITDIG PERIOD 

A. Purpose 

The official reason for the adoption of a ten-day waiting period be- 
fore filed p -ices could become effective is that this much time is re- 
auired'by the Pacific Coast producers. As a rule ten days are not neces- 
sary since the competitors on the coast receive new schedules fron each 
other several days before they reach Washington, sud. thus have more than 
ten days in which to decide on their action (table 7). The Association 
states, however, that the real problem arose from defective schedules. 
At one time such a schedule arrived from a California company and was 
followed by several competitors, then by a corrected schedule from the 
original firm. It reouired ten days to straighten this out. Admittedly 
producers in the eastern states did not need so long a waiting period, 
and the coast companies might either have filed in a regional office or 

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have been allowed ten days while eastern companies were allowed five. The 
Association, however, having decided that complete coverage of the coun- 
try under one price filing system r 'as desirable, stood ~by it regardless of 
such differences. 

The reason for the waiting period may be sunned up by saying that it 
v.'as desired (l) to insure knowledge o~- everyone of all orices in effect 
at the moment, end (2) to give sroducers who are informed of a change 
time within which to decide on action, prepare schedules, and send them ■ 
out to all their salesmen. In practice so nuch time vas thus consuned 
that schedules seld.om arrived, until i. If of the waiting neriod was pone, 
(to. ble 11). Indeed, out of 204 schedules filed to meet competition in 
Zone 5 which were counted for this purpose, 3? reached the Association 
too late to be effective along with the price leader's list ( and 10 
of the rest failed to meet the competition exactly anc thus also had to 
wait ten full days). In Zone 5, 44 ■ at of 154 schedules filed to ieet 
competition arrived too late (t .1 10), 

Another argument usee in t.iis Lndi stry is that so large a percentage 
of the sales ere ma.de in the olanting season that without a waiting 
•oeriod it would be easy T "or a conroajav to make a sudden price cut and then 
sell its entire output before competitors realized the situation. 

3. Critic! sm 

The .principal complaint made against the ".laiting period in other in- 
dustries has been that it constitutes a "period of inti lidation and co- 
ercion" during which a compan?/ reducing prices is induced to withdraw 
its list and a company raising them is able to bring the rest into line. 
So far as the. evidence in the possession of this unit is concerned, such 
a view is not applicable to the fertilizer industrv. It has not found 
corn-plaints, either, in. the files or in the field, to this effect. ( *) 
Certainly the fact that only the large concerns regularly met changes 
within ten days (table 7^ indicates that there cannot have been much 
"coercion" by the price leader to make the rest, follow his price advances 
within the waiting -period. 

The best proof that the waiti » period results in coercion should 
be found in the record of withdrawals of price reductions before their 
effective date. In this connection it has been said, that: 

"Reasonable stability in prices, terms, and conditions 
resulted despite the fact that some oroducers were too 
prone blindly to follow a competitor's open orice fil- 
ings that were not soundly conceived. Very frequently 
experience and sober second thought resulted either in 
the withdrawal of sue i a fall cious schedule or in the 
filing of a new schedule that returned to sounder mar- 
keting principles." (**) 



(*) It is not claimed that such c; e have not occurred. Nor does this 
discussion pretend to be a co iolete tre; t le it of the writing period as 
a tool in price filing. This bask is left to the Price Filing Unit, 
Trade Practice Studies Section, Division of Review, 

(**) Brand, Charles J., in Proceedings of the Eleventh Annual Convention 
of the Kational Fertilizer Association (1935), to. 32-33. 

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On the other hand, an analysis of the withdrawals in t r, o zones and 
three subsones (Table 21, exhibit 21A) failed to disclose more than tvo 
cases (Zone 5 - April and May 1934) in which terms mo^e favorable to con- 
sumers were withdrawn without explanation. Even in these instances, there 
were nrice cuts on onl - ' t'' r o to four out of fort - / to fifty items. The evi- 
dence of coercion under this heading is scanty or non-existent. 

VI. RELATED CODE PROVISIONS 

The price filing provision of the code was an essential tool in en- 
forcing the prohibition of sales below cost, ranking next in importance 
to the cost accounting formula approved for the industry by FRA. In 
other words, if the sale charged to be below cost was in accordance with 
the filed price of the company, such filing constituted necessarv and 
sufficient admission of sales at the price in question. It it involved 
a deviation from the schedule, it w r . s found easier to proceed on grounds 
of deviation than on grounds of selling below cost. 

There is no provision in the code for classification of customers. 
In August 19,11 NRA approved a proposed compilation of the names of dis- 
tributors by zones, and in October 1934 NPA Administrative Order Uo. 67- 
36 gave the code authority power to require producers to prepare such 
lists; but the only list actually prepared, according to the Association, 
was for Zone 4. The purpose in mind was primarily to unmask consumers 
who were masquerading as agents in order to secure lower prices. It is 
clear that the price filing plan resulted in a more strict classification 
of customers in so far as it tended to separate agents and consumers more 
sharply and prevent the latter from receiving the agent's discount. (*) 



(*) There was a good deal of trouble with the treatment of farm coopera- 
tives under the orice filing plan, but this topic is left to the Ferti- 
lizer Unit, Chemical Group, Industry Studies Section, Division of Review, 
which has acquired more information on it. See Chapter V on a further 
discussion of dealers, agents and consumers. 



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. -27- 

CHAPTEP, IV 

EFFECT ON PHI PES 

1, TREED 

Table 12 present? seven price series - the wholesale, price indexes 
for mined fertilizers compiled by the national Fertilizer Association and 
the Bureau of Labor Statistics, the. Latter' s index of prices of 3-8-3 in 
the South Atlantic States and, for comparison, its price indexes for all 
finished products and fertilizer materials; and the Bureau of Agricultural 
Economics index of prices paid by farmers for fertilizer and materials, and, 
for comparison, tha _ for all goods bought. On both the wholesale and re- 
tail basis the price of fertilizer rose less rapidly than other prices (ex- 
cept those of fertilizer materials, which actually declined during the Code), 
whether measured from the low point in the spring of 1933 or from the last 
p re-Code month. 

In considering these index.es, it should be remembered that the Nation- 
al Fertilizer Association index is compiled from reports on 14 grades sent 
in by one company each and gives 3T.0.B. plant cash car lot prices to dealers. 
The individual prices are, therefore, unreal in that tney are obtained by 
deducting the average freight oaid on all sales, whereas the actual price 
charged (being on a delivered basis) always includes freight. ( *) The 
Bureau of Labor Statistics uses the same prices (obtained from the Associa- 
tion) but different weights. 

Uhen we turn from price indexes to actual prices received by the pro- 
ducer as reported in a cost survey undertaken by the Association, the in- 
crease turns out to be much larger - 34 percent between March 1933 and, 
March, 1934 (table 13). If this result is correct, the price indexes give 
a misleading picture. Discussion of this contrast with representatives of 
the industry brought out that the probable explanation is that the cost sur- 
vey is based on actual cash receipts, while the companies which report their 
prices to the Association monthly, for use in the indexes, do not mention 
any discounts granted below the published price, especially those granted 
at the end of the selling season in the form of "retroactive settlements". 
In other words, tables 12 and 13 taken together indicate that such discounts 
were large .in. the spring of 1933 - a fact which is brought most clearly by 
comparing the 3-3-3 prices in the two tables. Evidently the comparison of- 
ten made by the Secretary of the Association between the 34 percent increase 
in the manufacturer's receipts and the increase of only about 15 -percent in 



( *) The price indexes for mixed, fertilizer and fertilizer materials com- 
piled. by the Association are components of its weekly wholesale com- 
modity price index, which 'was the first comprehensive weekly index 
compiled in this country, and which has been issued regularly each 
week for the past ten -ears. The index has a wide distribution and 
■use, the result of its long record in accurately reflecting changing 
price levels. Although the prices of fertilizer, as well as of other 
commodities included in the index., are quotations rather than realized 
- prices, changing price trends are quickly shown by fluctuations in 
the indexes. 

9815 



-28- 

farmer's cost in the same period is justified. ( *) If so, the dealer ra- 
ther than the farmer has been affected by price movements under the code. 

Turning to the price trends reflected in the filed schedules, the 
increases measured from November 15, 1933, are relatively moderate. Thus 
the cash price of grade 3-8-3 to carload consumers increased 10.7 percent 
in Zone 5, .3 percent in Zone 8-B, and 5.3 percent in Zone 8-C, between 
November 1933 arid May 1935 (table 14). Evidently much of the rise had oc- 
curred prior to the establishment of the price filing system. Indeed, the 
average farmer, who buys less than 10 tons a year (**) - that is, much less 
than a carload - paid no more for his fertilizer at the end of the code 
than at the beginning, in a typical Southern State (table 15). 

Similarly, tables 16 and 17, which compare the list and cash prices 

of 4-8-4 in nearly all the sub-zones, for the first and last schedules 

■filed under the code, show in many cases very small increases, in a few 
cases actual decreases. 

The difficulty with the use of filed schedules to judge price trends, 
as has been observed already, is that deviations from the list were 
common prior to the code,, Ih some districts - especially Virginia, the 
"Carolinas, and other parts of the Atlantic Seaboard - it was customary 
after selling sea.sons during the depression for producers to make retro- 
active settlements allowing customers the lowest price prevailing at any 
time during the • season. In other districts, in other seasons, or with 
other customers, competition did not go so far - but producers would 
meet a lower price than their own, wherever they. found it in the field, ' 
regardless of their published schedules. 

II. FLEXIBILITY 

It is difficult to discuss the flexibility of prices under the price 
filing plan in the absence of comparative data for the pre-code period. ( ***) 
The price schedules show, on the average, four changes during the 18 
months of code operation. The only comparison possible is on the basis 
of the wholesale price of grade 3-8-3 in South Atlantic States (the only 
product given separately) as reported by the Bureau of Labor Statistics. 
It- appears that there were four changes in the 18 months under NRA as 
compared with 13 in the l\ years ending in July, 1933 (an average of 2.6 
in each 18 months period); and that the later changes averaged 79 cents each 
and the pre-code changes averaged $1.38. Apparently there was no "undue 
rigidity" of prices here, under the code. 



(*) Senate Hearings, loc. cit.., note p., page 1734 

(**) National Fertilizer Association, "American Fertilizer Practices, 
A series of Reports Relating to the Use of Commercial Plant Food 
Presenting Information Obtained by a Survey Among 48,000 Farmers in 35 
States" (1929), page 60. 

(***) All producers interviewed on field trips were ashed for copies of 
pre-Gbde price lists to be examined there or borrowed as convenient. All 
stated that they had no such lists left. 



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_ 3 n _ 



III. UhlFOhhITY 



Tables 18-22 throw light on the increasing uniformity of prices among 
competitors which, in this as in other industries, is one of the results of 
open --rices. The various elements in t le situation may "be stated as follows: 

(1) There was a reasonably nigh degree of uniformity even in the first 
schedules filed under the code - 30 percent in Zone 4 C, 69 percent in Zone 
5, 77 percent in Zone 6, 72 percent in Zone 8 C, and 85 percent in Zone 9. 
The deviations from the t pic .1 price are partially hut not entirely explain- 
ed "by ciffe.-ences in the basis of quotation - e.g. the Zone 5 companies 
Itable 20) which quoted ;>22.65 to dealers were willing to sell to consumers 
in carloac lots at a pre: hum of $1.50, thus bringing their prices in line 
with the two companies quoting |524.15. Table 22 illustrates this uniformity 
hiding behind diversity in the early schedules in Zone 5. Some of the other 
deviations' are explained simply by the fact that companies ostensible charg- 
ing more than their eonroetitors wore prepared to give rebates when necessary 
to get the business. It usually was necessary, since if farmers had no other 
way of knowing when lovrer nrices were quoted elsewhere, they were able to 
learn it from county agents, who e ctive in the South in spreading in- 
formation regarding fertilizer -prices . As far as can be learned, fertili- 
zer is sold on so competitive p basis in the heavy consuming districts that 
no company can secure more than another for its product. Pre-code deversity 
of prices, in short, was nuch more apparent than real. 

(2) The percentage of uniformity disclosed by the schedules became 
much greater under the price filing plan, rising from SO to 95 percent in 
Zone 4 0, from 69 to 98 perce.it in Zone 5, and from 77 to 95 percent in 
Zone 6. 

(3) lairing long stretches, especially in the slack season but extend- 
ing well into the selling season, diversity of nriccs rrevailcd since so 
many companies delayed filing new schedules until January, February or March 
of' the new year, (table 7). An attempt was made to find out whether compan- 
ies delaying their filings 'at the time of a price increase were exploiting 
their position in the interval by actively selling at the old trices, and 
whether those which delayed their filings at the time of a price decline 
were actually deviating from their schedules when necessary to make sales. 
As far as could be ascertained from discussion with members of the industry, 
both of these situations occurred occasionally - but much more often the com- 
pany which delayed its filing was not selling at all during the interval. 

IV. MATERIALS A"D SPECIAL MIXES 

A. M aterial s 

Hone of the materials used in the fertilizer industry, with the possible 
exception of superphosphate, mas its price determined by conditions within 
the industry. Although producers of mixed goods all quote selling prices 
on materials, the real market is their bu; i: m rket. Table 23, which gives 
prices under the. code for superphosphate, nitrate of soda, and kainit, the 
three most widely used materials in the South, is -presented merely for com- 
parison with nrices of mixed : 

The uniformity of -'-.rices for materials sold by fertilizer producers is 
about as great as that for mix >d.s'. The principal diversity is in nitrate 

9815 



-30- 

of soda and sulphate of ammonia, articles in which the competition is 
greater and which have at tines been used as "loss leaders" by 
fertilizer producers. 

B. Home Mixing 

If a farmer has the labor to spare and does not mind a possibly 
lower duality product, it may pay him to buy the materials direct and 
mix them on the farm. It is impossible to say how much of this home 
mixing is dene, or whether it is increasing or decreasing, since there 
is no way o1 knowing what' percentage of the materials sold to farmers 
is applied directly to the soil and what percentage is used for home 
mixing. In 1928 the Association, by a questionnaire to 48,000 farmers, 
found that 31.4 percent had tried home mixing in the past, that 78.9 
percent of these had found the results satisfactory, and that 9.3 per- 
cent of the total "'ere still home mixers (*). Table 24, which is 
based on the price schedules filed by a leading company in South 
Carolina, shows the hypothetical "money saving" to a farmer by home 
mixing and the trend of that saving under the code. It is merely 
suggestive, since there are no data, on the relative percentages of the 
various kinds of nitrogen and potash in the different grades sold by 
the various companies. These formulas are jealously guarded trade 
secrets. If, for example, the percentage of organic nitrogens used in 
the mest popular mixed goods increased under NBA, then the farmer would 
have to pay more for his materials, if he were planning to match the 
product of the manufacturer. In this case the apparent increase in the 
home mixing margin would be deceptive. 

C. Tobacco Grades 

The numoer of grades prepared for the use of particular crops is 
almost as large as the number of crops in the country. Whether the 
major crop of a zone is cotton, corn, wheat, potatoes, or citrus fruits, 
there are "special grades" for other uses - e.g. truck gardening, 
grapes, onions, etc. The most important of these special grades in the 
South is that for tobacco. The formulas for this use are kept secret 
by the individual producers, but they include sulphate of potash, 
cottonseed meal, and other expensive materials. Table 25 shows the 
extra charge made for tobacco grades under the code in zone 5. 

D. Special Mixes 

On September 2, 1933, a small South Orolina producer wrote the 
NBA protesting against the proposed ten-day waiting period in the price 
filing plan on the ground that a large part of his work consisted of 
mixing to order, so that he could not know until the order was placed 
what grade was wanted(**). This letter is especially interesting since 



(*) National Fertilizer Association, "American fertilizer Practices", 
1929, page 35. 

(**) This letter is summarized in the NBA Piles, Fertilizer Code, 
Division of Beview Vork Sheets. 

9815 



-31- 

it is the only one received from a producer objecting to the price 
filing plan. 

To clear up such doubts as these, the code authority passed the 
following resolution. 

"That it is the opinion of the Committee that, under the 
provisions of the Code, each producer's open price 
schedule must list each grade or hind of mixed fertilizer 
superphosphate, and/or other fertilizer material to he 
sold or offered for sale to dealers, agents, or consumers 
by such producer, but this shall not be construed to pre- 
vent the sale of special formula.s or special ingredients 
in standard formulas to satisfy bona fide orders from 
consumers if adeauate additional charge is made for mixing 
costs as determined for the particular plant under the 
uniform accounting methods prescribed under, the Code, plus 
the extra cost of special materials used, and if such 
additional charge is shown in such producer's schedule." (*) 

In other words, no ten-dry waiting ceriod was required if a producer 
listed a general scale of charges for any formulas not specifically 
named in his schedule,, After January 1, 1934, therefore, the producers 
stated in their schedules what they would charge for each unit of 
nitrogen, phosphoric acid, or potash in any special mix desired by a 
customer and not included in their regular list of grades, and what 
charge they would make for the service of mixing (tabJ'e 26). The 
charges filed were almost all the same, in spite of the diversity of 
charges which might have been expected from the wording of the Regula- 
tion, which im-olied that mixing costs would vary with the individual 
costs of the companies;, On the other hand, sales belo™ cost to meet 
competition were permitted by the coda. 

E. Crade Differentials 

The fertilizer producers used the same, unit prices for nitrogen, 
phosphoric acid, and potash in establishing the differentials between 
the various grades regularly offered as in fixing rates for special 
mixes (table 27). . 

V. DELIVERED' FRICES 

A. Pre-Code Price Bases 

The 1928 price schedules in the Federal, Trade Commission files 
(basing -point inquiry) show that the majority of price ouotaticns were 
on a zone delivered basis, as they are today. There were far more 
dissenters, however, many firms having been selling F.O.B. plant. One 
large company, for, example, used delivered prices in one district F.O.B. 



(*) This follows in nart the wording of Article YII , Section 1 of 
the Code (Code for the Fertilizer Industry, Codes of Fair Com- 
petition, Volume II, cage 123). 

9815 



-32- 

plant prices in another, and' a basing point system (i.e. quotation at 
a given city, although plants from which shipments were made to the 
district in question were located elsewhere as well) in a third. A 
saving clause -provided that "when : and if competition warrants", any 
city would be used as a basing point. 

The industry has on the whole always preferred the delivered price 
system. In 1926 it had been adopted with substantial uniformity, but 
the Department of Justice considered it a major feature of price fixing, 
when achieved by agreement, and its investigation was enough to 
restore the diversity found by the Federal Trade Commission in its 1928 
basing point inquiry. 

In 1933 a few companies were auoting on a "delivered to the farm" 
basis, the majority on a "delivered to the dealer's railroad station or 
boat landing" basis, and a very few F.O.B. plant. Nitrate of soda 
(and for a brief neriod all materials) was being sold "F.O.B. Gulf and 
Atlantic Ports", because of the dominance of the importing interests 
vhich naturally sold at these -points. In December 1933 one company with 
seven or eight plants from which it shipped fixed fertilizer to South 
Carolina, changed its quotations from a "delivered to the dealer" to 
an "F.O.B, three ports" basis. In other words, it adopted a basing 
point system for mixed goods similar to that for nitrate of soda. It 
was followed by one other company, but the nlan was abandoned at the 
beginning of 1934. 

3. Delivered to the Farm Basis 

The typical price Quotation under the fertilizer code has been on 
a "consumer, delivered to the farm" basis. The great majority of the 
zones went over to this method in their first -price lists filed in 
1934 (table 28); and in this move the majority of companies formerly 
quoting "delivered to the dealer" were joined by the small minority 
formerly quoting F.O.B. r>lant. Materials also were sold thereafter on 
a farm basis. 

Rea,sons given by members of the industry for the use of a 
delivered price system are that it makes it easier to meet competition, 
that it simplifies quotations to the customer, and that it diminishes 
the evil of discrimination by establishing a known price for each 
company uniform throughout a given territory. (As has been observed, . 
prices became uniform among different companies within each zone as 
well). From some points of view delivered prices are simpler than 
F.O.B. prices, but not from all; thus in 1928 the producers using the 
F.O.B. system replied to the Federal Trade Commission Questionnaire 
that they preferred it for its simplicity. Another reason given at 
that time for not using delivered pricing was that it led to the 
absorption of undue amounts in freight on shipments to distant customers, 
or, as stated by others, that it prevented the earning of a uniform 
profit over cost at all factories owned by one company or on all ship- 
ments made from one plant. 

While ,• full discussion of the effects of delivered prices 
9815 



~33~ 

is not -possible here (*), it must at least he remarked that significant 
criticisms could he made. The customer located close to the factory is 
charged a higher freight than that actually paid on his shipments, while 
the most distant customer does not pay for all the freight service which 
he receives. This special favor to the latter is inconsistent with the 
code provision which (doubtless actually intended to apnly to trucking) 
condemns such "gifts" of transportation: 

"The following shall he deemed to he unfair competition within 
the meaning of the national Industrial Recovery Act and are 
herehy -orohibited: , . Providing transportation without 
adequate charge for it. •"(**)• 

C • Inter-Zone Shipments rnd Fre igl it Absorption 

The delivered "orice system usually has as one result the cross- 
shipment of the -oroduct by coiroanies located at different ooints. Table 
29 shows the location of slants outside South Carolina which sold into 
the State and the States into which South Carolina companies sold. The 
thirty outside firms selling in South Carolina constituted approximately 
one-fourth of the total number selling there, The range of freight 
rates per ton from some of these outside points to various South 
Carolina cities is mentioned in taole 27, to show the degree to which 
these firms were billing to a,usorb freight and thus reduce their mill 
net 'receipts in order to get into the market. This very brief survey 
would indicate that cross-shipuing between zones is not a very serious 
problem - thus, it may be that no plant outside zone 5 (except the one 
in Baltimore) absorbs more than $3.2') per ton in freight. In comparison, 
the freight between Charleston and Anderson, both within zone 5, is 
$3.50. ' Similar!', South Carolina producers do not sell very far beyond 
the borders of the State, 

A number of estimates have been obtained from comoanies of their 
average freight cost per ton of fertilizer on oroducts both manufactured 
and sold within a territory (table 30). They range around two or three 
dollars, for mixed fertilizer on which the arice to the dealer or agent 
averages $25 to $50. The peal" figure (which is ouite exceptional) is 
$6, or approximately 20 to 25 oercent of the delivered price. This 
$6 is apparently absorbed only in order to convenience distant customers 
who buy other fertilizer from branch olants of the company located nearer 
to their ola.ces of business. 

One coraoany is uniaue in resoect to the number of zones to which it 
shins from one Blant in Baltimore. Traditionally, this firm has ouoted 



(*) They will be analyzed at length in the report of the G-eographic 
Price Structure Unit, Trade Practices Studies Section, Division 
of Review. 

(**) Article VIII . Section 5 of the Code "or the fertilizer Industry, 
Codes of Pair Comoetition, Volume II, page 130. 



9815 



-34- 

on an F.O.B. Baltirao-e basis, but it yielded to the trend in 1934 and 
shifted its method of quotation. On A'oril 1, 1934 it sold in 16 out 
of the 18 sub zones fof which its prices wer© available on an F.Q.I3. 
basis', but a year later this had dropped to 4 out of 20. Table 31 shows 
some price and freight rate data gathered for this company, but its value 
is illustrative only - due to ignorance of now much fertilizer the firm 
ships to different -points within each zone or subzone and how much by 
rail, by water, and by truck. It is understood that nearly all its 
sales are in the territory oounded by New York, Ohio and Virginia, and 
that it filed in other zones only in order to take advantage of any 
profitable large contract that might develop. All that can be said is 
that the mill not receipts of the company vary with the zones in which 
it sells - but not inversely with the distance (due to the non-distance 
elements contributing to price differentials between zones). Mill net 
receipts vary even when the company is selling P. 0.3. plant, since in 
that case it must reduce its Quotations if necessary to get its 
product into different zones at their prevailing market level. 

D. Trucking Allowances 

Under the code producers in each zone were permitted to recommend 
to the NBA uniform schedules for trucking allowances - in other words, 
for deductions from the price to customers who trucked their own 
fertilizer either from the railroad station or from the factory (*)• 
This unit has not found any record that such recommendation were 
actually made. Presumably the various companies decided independently 
on the 'allowances they would make - although the usual high degree of 
uniformity at once developed either as a result of the discussion held 
within each zone or more simply from the meeting of competition. 

For trucking from the railroad station to the farm, the dealer or 
farmer received in most zones an allowance of 75 cents per ton, which 
remained constant (except that a very few companies, early in the 
code, allowed $1.00). 

The allowance for trucking from the factory itself was usually 
on a sliding-scale basis, depending on the distance. It was uniform 
within each zone, but varied from zone to zone (table 32). Prior to 
the code, most districts had provided for deductions equal to the actual 
rail or water freight rate from the plant to the receiving point nearest 
the customer; but the schedules rdopted after January 1, 1934, usually 
allowed a lower rate (table 33). According to the American Trucking 
Association, which protested against the schedules in force vmder the 
code^ the allowances were so low that it did not pay dealers or con- 
sumers to hire trucks, thus switching this business to the railroads. 
In a few zones the railroads had already cut freight rates so low to 
meet truck competition that the trucking allowances were not subject to 
this cril '■■ism.) \fnen the farmers did their own trucking (having only 
gasoline and oil to consider), the profit of the fertilizer companies 
was presumably increased over what it would have been had shipment been 



(*) Article VII . Section 7 , of the Code for the Fertilizer Industry, 
Codes of Fair Competition, Volume II, pages 129-130. 

9815 



-35- 

raade by rail. 

The importance of this problem may be measured by the fact that 
in 1935 approximately 30 percent of the shipments of fertilizer by 
factories east of the BGcky Mountains were by truck (*). The trucking 
allowances constituted only a very United modification of the delivered 
price system, since - to the extent that trucking allowances and 
trucking costs cor~espond - it should be indifferent to the buyer 
whether he takes deliver,.' at the delivered price or fetches the 
product and receives the allowance* 

3. Inter-Zone Price Comparis ons 

The difference among prices charged in the various zones are 
constantly changing, due to the varying intensity of competition, to 
crop prospects and resulting demand for fertilizer, etc* Underneath 
these changes, however, differences based on the relative distances of 
the territories from centers of manufacturing production tend to remain. 
?or example, Tennessee prices are generally higher than those prevailing 
nearer the Atlantic Seaboard, whe v the majority of factories are 
located, and ^here nitrate of soda and potash are landed (table 34). 
At the beginning of the Cede period prices "ere uniform from Ilorth 
Carolina through G-eorgia, the whole South Atlantic Seaboard constituting 
a selling district (with subdistricts frequently splitting off, however, 
as supply and demand warranted). The break-up of this territory into 
three zones resulted in a drift of prices apart - (table 34) - 
South Carolina prices being lowest, due, it is understood, to greater 
manufacturing capacity in relation to consumption (rather than to any 
freight or distance factor). 

The Middle Western and Western zones - 10, 11 and 12 - tend to 
have their own separate price movements. Zone 1 stands apart also, due 
to crop differences, (subzone A being the county's chief potato 
producing district) and the neighborhood of Canada, who ,e producers, 
having no tariff to surmount and wages of 30 instead of 35 cents an 
hour to pay, were active competitors during the code period, In zones 
2 and 3 price changes ran through most 1 " all of the subzones on 
January 18, February 5, and February ?2, 1934. Later, however, these 
zones practically formed a part of the Southern belt throughout which 
important price changes tended to travel. The Alabama territory stood 
apart at times when it was quoting on a dealer oasis, but typically 
price movements would spread throughout the whole south within a period 
of a month or two (table 35). 



(*) National Fertilizer Association, "Special Survey of Inbound and 
Outbound Fertilizer Shipments, 1053," reported in USA. Files, 
Fertilizer Code, Division of P-eview Work Sheets. 



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CHATTER V 

EFFECT PIT DISTRIBUTION 

I. NUMBER OF GRADES SOLD 

The large number of grades made by the fertilizer producers is 
one of the main sources of waste in this industry. In several states (*) 
the number of analyses which could "be sold was reduced during the code 
by order of NRA, acting on recommendation of the local producers (**). 
In most zones, however, the number of grades quoted increased during 
this period (tables 36, 37) „ 

There is some confusion as to whether the large companies usually 
offer more *rades for sale than the smaller comprnies. Table 38 indi- 
cates that they offer more grades than the/tiny local concerns - which 
is admitted by all - but that the medium-sized companies are not left 
behind. In respect to this point, the big producers state that they 
can afford chemists, who have taught them the folly of selling too many 
grades* On the other hand, the number of grades quoted on price schedules 
(the source of tables 36-38) is deceptive, since the la„rge companies say 
they have at times listed all the grades they could think of, so as not 
to have trouble with the ten-day waiting period in case an order should 
come in for an unusual grade, while the small firms often admit that they have 
merely copied the grades on the big firm's list, with no intention or 
likelihood of selling all. 

One of the most active forms of competition under the code con- 
sisted in the offer of additional grades, which could be done under the 
price filing plan without the mailing of a complete new schedule. During 
the heavy selling seasons producers repeatedly filed additions to their 
lists (effective ten days later) and net each other's competition, 
(table 39) although no one grade was ever added in such fa.shion by more 
than a few firms. These additions night be due to a demand by an impor- 
tant customer, the disclosure that the soil needed some special plant 
food that particular season, etc. 

II. SALES TO CONSUMERS . 

A. Lar^e Farmers 

A large but unknown fraction of the fertilizer used in the country 
is sold direct by producer to consumer. According to a practice origi- 
nating in the World War with government control, the producers are gener- 
ally willin ; to sell direct to consumers buying as much as a carload 
(which is about the season's supply of. /a fair-sized, but not large, 
farmer.) Some, however, give the agent his compensation on all sales in his 



(*) Arkansas, Delaware, District of Columbia, Louisiana, Maryland, Miss- 
issippi, North Carolina, Texas, Virginia, West Virginia. These re- 
ductions occurred in November and December 1934. 

(**) This is provided for in Article VII . Section 1 of the Code for the 
Fertilizer Industry, Code? of Fair Competition, Volume II, pages 
128-129. 

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-37- 

territory, even direct ones. This is no special loss to the producer, 
since ''aider the consumer price basis adopted unler the code there is 
no discount allowed a consumer for buying direct, A number of large 
farmers have become "agents" in order to secure the discounts, caas'.ing 
much confusion in code enforcement* Other large consumers ^ere later 
appeased by the grant of qus rtity discounts (*). 

Seven farmers were interviewed on a field trip in Virginia. All 
bought their fertiliser from dealers rrther than direct, and none was 
interested in the code or believed that it had raised prices unduly. 

S . Government Purchases 

: Most price -schedules provided special terms to governmental buyers 
(and usually to charitable agencies ps veil). In Zone 4 B, for example, 
the terms allowed by omeleadin; company were: 

After February 5, 1934 - agent's trices; 

After June .30 - agent's prices on cash sales, consumer prices 
on time sales; 

After November 19 - consumer's cash -Trices (quantity discounts 
to be bfised on single murchaRes, not entire season's 
transactions); plus "any part or all of the tolerance 
permitted by the Pr< sident's Executive Order No« 5767". 

ITi-lA. Execut iv e Ord er No« 6737, dated June 20, 1934, permitted compan- 
ies operating under open price codes to reduce trices 15 percent below 
the published list on srles to government bodieso The producers state 
that public purchasing agents refused to buy any fertilizer on which 
this 15 percent reduction was not ;rante ., resulting in many sa3.es below 
cost. Some companies formally -enounced that they would not grant the 
reduction - e.g. the company just cited made such a declaration in its 
list effective September 29, 1934, but was unable to maintain it. At 
the end of the code this firm allowed the 15 percent cut in its schedules 
for zones 4 and 8-B. stipulated against it in zones 5 end 8-C, and was 
silent in zone 3- A. 

III. DEALERS AID AGENTS 

A. C hange from Se al er to Agen t 

Prior to the code, fertilizer was generally soli by the producers 
to independent dealers, although dealers whose credit was poor were 
treated as commission agents, goods being shipped to them on consignment 
(the title remaining' with' the manufacturer) The producers state that 
the dealers were able to force down their buying prices by playing one 
producer against another, and that at' the same time they exacted exorbi- 
tant prices from consumers. Throughout . ost of the country the agency 
system replaced the dealer syst ;:: under the cede (table 40)e Simultan- 



(*) See Chapter VI, II. 
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-38- 

eously the producers began to quote their prices on a "consumer, 
delivered to the farm" basis. 

Under the agency system the -orice scheduD.es usually required 
the agent to sell at list -prices (as appears in the agency contract, 
reprinted in Appendix II). He was allowed to sell above list prices 
only in case of special credit risk or special warehousing services 
rendered to buyers and involving expense. These provisions make it 
appear that the maintenance (in .a legal manner) of resale prices against 
cutting was one of the purposes of adopting the commission system of 
distribution. (*) 

In Zone 8-3, consisting of Alabama and Western Florida, a number 
of companies continued to sell to dealers, (table 41), and price cutting 
both to dealers and to consumers continued more actively than in other 
zonesr This involved some reductions in published prices (tables 14, 16, 
17) and scrrrj violations of the Code by sales belov; published prices. 
Wv'i [."!• olo: - being free to charge the consumer what they wished, cut 
prjces 'ci'lc r the published schedules of the companies selling on a con- 
su::j r>, :.i\ there was no alternative for the agents of the latter ex- 
cept ic ;• . ■ the competition. According to the Association, there were 
times ' - ' discrimination between customers was as common as it had 
been elsewhere prior to the Code. 

The change from dealer to agent was of great importance, not only 
in the control f ' .. ii-ice to the consumer but in the securing of a 
pre' ' i C^-li price '/ the manufacturers B s depressing influence on 
act'j . market prices exerted ~oy dealers who played one producer off 
against another before the cede must have been eliminated when the 
dealers became agents, and the disappearance of the previous discounts 
which had cut the manufacturer's net receipts so far in 1933 (table 13) 
was due partly to this change. 

It is worth mentioning that the i nous try had made ■ two earlier ex- 
periments with the agency system. It was in effect around 1922 and 
1923 (**'jj and again in 1925 and 1926 it was adopted by the whole in- 
dustry (at least in the South). The Department of Justice in 1926 dis- 

(*) According to an officer of a large fertilizer company: "Since the 
adoption of the Code, consumers have had a. uniform -orice, the 
agents a known profit, and the producers a fair return on invested 
capital. In this connection, I think it is generally conceded that 
when a producer (manufacturer) sets a consumer -orice, a much fairer 
price is set in rela.tion to cost than when such a price is set by 
a middleman" (Senate Hearing, loc cit . . note p. 8i > p« 1745), 

(**) "Fertilizer Industry," Letter fro. i the Acting Chairman of the 

Feder; L Trade Commission, 67th Congress, 4th Session, Senate Docu- 
ment Ho. 347 (1923), page 36. 



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-39- 

covered the existence of an agreement which it alleged to be in viola- 
tion of the anti- trust lavs, one feature of which was the "delivered 
to the farm" basis combined with the consignment system of selling 
through agents. As a result of the ■ ction which it instituted in 
December 1956, the fertiliser companies involved, naid $90,500 in 
fines following a pies of "nolo contendere" (*), and most of them then 
vent back to the inde ionde: t dealer system. 

B , A,::ent ' s Coi r:' j n^-tion 

There are no fiaures available on the margin of the independent 
dealers, since their resale prices '-'ere not fixed. As regards the 
comriensati on allowed by the jroducors to their agents, there were no 
really significant changes during the life of the code (tables 42, 
43) e For a tine in the summer of 1934, the compensation allowed in 
several southern States vs increT-ed from 5 to 7 percent; this was 
due to the complaint of a ;ents in soarsely settled districts arising 
from the establishment of quantity discounts and the discovery that 
they did not sell enough to qualify for them. It was again reduced, 
however, when it appeared - according to the ^r'-ducers - that the 
agents in thickly settled sections were passing on the extra 2 per- 
cent to the consumer in order to ricrop.se sales. This problem was 
still unsolved -at the end of the code. 

C . Com xl pints by Distributors . 

There is no record in the !IRA correspondence files (**) of any 
complaint by dealers against the change in their status fron merchant 
to agent, llor did any of the ten dealers interviewed on field trips 
in Maryland and Virginia complain - most of them s in fret, considered 
the fertiliser to belong to them after they had paid cash for it, al- 
though they admitted that their contracts ^itr iroducers stipulated 
the opposite (Appendix ll). 

There was, on the ether h; id, a certain amount of complaint 
against the reduction in the margin allowed distributors. According to 
Mr. drand; 

"There has been soie slight complaint, very mod- 
erate in extent, en the part of distributors.. This 
has been due largely to the fact that their profit 
margins have been dacreased under the more efficient 
and fairer distribution of fertilizer that exists under 
codal as compared with pre-codal conditions^ I think 
it is a. safe generalization to say that 90 percent of the 
dealers and agent:: engaged in the distribution of ferti- 



(*) See Department of Justice, "The Federal Anti-Trust Laws with Amend- 
ments*" a pamphlet giving data one 1 .! government anti-lrust suits. 

(**) See Semi-Weekly Hail Summaries, The remarks in this reoort are 
based on ITos. 1-140 onl . 

9815 



-40- 

lizer feel that the code has operated, efficiently and 
fairly to all concerned." (*) 

Similarly, a number of letters came to NBA complaining against the re- 
duction of agent's compensation "to 5 percent" (**)• In the zone re- 
ferred to in the one complaint for which the address of the writer is 
given (Zone 4-B), the agent received 15 percent if he paid cash him- 
self, 10 percent if he did not pay cash but guaranteed ultimate pay- 
ment of the fertilizer "by the customer, and 5 percent if he did not 
guarantee. These terms were customary in most of the country. In the 
price lists filed at the beginning of the code, and dated September 1933 
- thus representing pre-code condition - the terms are the same. They 
are also the same in the schedules filed with the Federal Trade Commis- 
sion in 1928 in connection with its basing point inquiry. 

No interviews on the field trips in Maryland and Virginia dis- 
closed small dealers who felt that the margin of compensation allowed 
under the code was too small. Two of the ten stated that their margins 
were higher under the code than previously; three (including the first 
two) were glad of the protection offered against competitors receiving 
secret rebates; four were merely "satisfied" with the code; and three 
were indifferent. 

It seems probable that it was the big dealers who suffered a re- 
duction in their compensation, since they had previously been able to 
buy at lesr than producers' list prices and sell for what they could 
obtain. This would partially explain the rise of 34 percent in prices 
to dealers (table 13) and only 14 or 15 percent in prices to consumers 
(table 12). 



(*) NBA Public Hearing on Prices, January 9, 1935, Transcript of Hear- 
ing , page 138. 

.(**) Two letters are referred to specifically in the Work Sheets of the 
Division of Beview, and it is stated that there were "a series of 
letters." NBA Semi-Weekly Mail Summaries, ITos. 1-140, mention only 
one complaint on this score, but perhaps include the rest under 
another more general heading. 

9815 



-41- 

CHAPTZR VI 

EFFECT Oil TiR T iS OF SALE 

I. CASH DISCOUNTS 

Host sales of fertilizer are on a cash "basis. In 1934 reports 
from '97 conroanies showed that only IS percent of their sales were on 
credit, while onl ,r 28 percent of purchases by farmers were on credit 
(table 44). Moreover, the percentage of cash sales increased during 
the life of the code. It has grown as a result both of the establish- 
ment of farm credit agencies by the government and of the high cash 
discounts allowed in the industry (Toole 45 exhibit 45A) 

The cash discounts allowed are almost invariably the same for 
agents and consumers. In other words, if the consumer jays casn to the 
agent, the latter must pass on to him his own saving as a result of his 
own cash payment. As a general rule, the fertilizer companies allow 
interest - usually 6, 7, or 8 percent per annum - on cash deposited be- 
fore the beginning of the season (often placed as late as March 1, and 
in the autumn September 1). Similarly, they charge the same rate for 
accounts not paid by the end of the season - often stated as July 1 or 
December 1. For payments made earlier a progressive scale of discounts 
is set up, starting usually around 6 to 8 percent (straight deduction 
from the time price - not per annum allowance) and rising as high as 15 
percent in certain zones. In addition, payment with order or on delivery 
(regardless of the calendar month) is usually rewarded by a 1 percent 
additional discount. 

In 1928 the highest cash discount (payment with order or on 
delivery) was generally 10 percent (*). By 1933 the companies selling 
on a consumer basis were allowing carload consumers an audit ional 5 per- 
cent cash discount - less than carload consumers, agents, and independent 
dealers receiving only the usual (10 percent) discount. When the majority 
of companies shifted to the consumer basis, they raised their discounts 
to the scale previously allowed b^ the companies selling on a consumer 
basis to carload consumers only. This was, however, only a formal 
change, since the $1.50 per ton differential over the dealer price 
charged to consumers (buying direct) by such companies usually meant in 
fact the same price to cash carload consumers as that charged by the 
"15 percent companies" (table 22). 

During the code, the discount allowed carload consumers rose in 5 
zones, was reduced in 18, and remained the same itt 9 (table 45). The 
discount allowed less than carload buyers, agents, and dealers was in- 
creased in 8 additional sub zones (Zones 4, 5, 6, 8B, and 8C) , but it 
was compensated, as stated, by the change in the list price. In short, 
the cash discount scale had no unified trend, but, if anything, tended 

(*) Based on examination of schedules filed with the Federal Trade 
Commission in its basing point study. 



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-43- 

down (on account of the establishment of quantity discounts) rather than 
up. 

II. QUANTITY DISCOUNTS 

The first price schedules filed indicate that prior to the Code 
quantity discounts were allowed in Tories 1 and 7. In December they 
were includr I in zone 12 schedules and in January in zone 11 schedules. 
Meanwhile lrrge consumers elsewhere, whom the "consumer delivered to the 
farm" "basis deprived of their differential for buying direct, were 
demanding quantity discounts to replace it. The result was the issue on 
February 6, 1934, of ERA Administrative Order Ho. 67-3, which made such 
discounts a mandatory part of r)rice schedules. There was much reluctance 
on the part of producers, as appears from the fact that the February 
1934 price schedules generally provided for discounts only on mixed 
goods and superphosphate, with the result that special instructions from 
the Secretary of the Association were necessary before the discounts were 
extended to materials (table 46). 

The establishment of quantity discounts was one factor which caused 
producers in several zones, in the autumn of 1934, to reduce their cash 
discounts (table 45 exhibit 45A) . On the other hand, the tonnage re- 
quired to receive quantity discounts was simultaneously reduced in most 
of these zones - the two changes offsetting each other for buyers of 
intermediate quantities. 

Only a very small percentage of farmers bu r in large enough 
quantities to receive the discounts (table 47). A larger percentage of 
agents handle sufficient quantities, but many of the typical county store 
agents do not, as appeared in the Maryland-Virginia field trip. 

The quantity discount scale was very nearly uniform among the 
competing companies. In zone 8-B at the end of March 1935, for example, 
47 out of 50 companies allowed exactly the same discounts. One of the 
other three provided more" liberal discounts to agents and the second to 
consumers, while the third allowed consumers more, but agents less, 
liberal termj. 

One unique feature of the quantity discount procedure was that dis- 
counts allowed to agents, and in some zones to consumers, were computed 
on the basis of total fertilizer bought during the season, regardless of 
whether it was bought from one producer or many. The object is stated 
to have been to help the small producers keep their share of the business. 
Presumably it did this, since under this rule agents who had to handle 
the well-known brands of some large firm were not driven by desire for 
a quantity discount to refuse to handle lesser known brands of smaller 
manufacturers. The enforcement of the rule made it necessary for the 
producers to check how much fertilizer each of their agents bought from 
each competing producer (submission of bills of lading or invoices being 
required for proof.) The thought has arisen that the object of this 
might have been to compile and interchange information on customers and 
the amount of their purchases from each producer, with the intent of 
allocating business. There is no hint in any of the records, however, 
which would support such a suspicion. A salesman of a producer, in any 

9815 



-43- 

event, could usually tell about how much a dealer had on hand from each 
manufacturer with whom he dealt. 

III. BULK ALLOWANCES AND BaG- EXTRAS 

Allied to the quantity discounts were the discounts allowed customers 
in most zones if they took delivery in bulk form instead of in bags. 
This allowance was not made prior to the code; in January 1934 it was 
established (using zone 5 as an example) at $1 per ton; in June it was 
raised to $1.50; in November it was again reduced to $1. Bulk shipments 
are made to producers, almost no consumers buying in this way except in 
New York State. 

Extra charges were made to customers requiring delivery in bags 
other than the standard burlap bag. The size of the standard bag varied, 
but 20C pounds was most common. Table 48 shows the trend of these bag 
extras in zone 5. 

IV. LESS THAN CARLOAD EXTRAS 

As a general rule rail shipments of fertilizer and materials are 
made in carload lots, the agents distributing it to consumers locally 
by truck. Quotations were commonly for carload shipments or for ship- 
ment at the option of the company (except that materials were often 
quoted in less than carload shipments provided mixed goods were bought 
at the same time in sufficient quantities to make up a carload), and 
agents or direct-purchasing consumers who bought in less than carloads 
were usually, although not always, charged extra. The charges applicable 
to agents in zone 5 were mentioned in table 42. Table 49 shows the 
charges applicable to consumers in zone 5. 

V. UNIFORMITY IN TEHMS OF SALE 

Most of the schedules which daily flooded the office of the 
Association in Washington were concerned with changes in terms of sale 
rather than the basic price. An example from zone 5 - the schedules and 
supplements which became effective during the first week in March 1935 - 
is given in table 39. 

Despite these constant changes, there was substantial uniformity 
in important terms among the various companies, allowing for the delays 
in meeting competition which have already been discussed (tables 50 and 
51). Terms of sale, as is apparent from the schedules and from dis- 
cussions with members of the industry, may be as important as prices in 
making sales, but the minor differences that are found in the records 
were seldom sufficient to let one -oroducer oust another from the market. 



9815 



-44- 
OEAPTSR VI I 
GEITEHAL RESULTS 



I . COLiPLIAlTCE 

It is believed in the industry that compliance with the price 
• filing provision of the code was fairly good on the whole - much 
better the.:: in the majority of industries under IRA. In other words, 
few of the fertilizer producers deviated from their filed prices. 
The records show that by the end of 1934 there had been IPO complaints 
of deviations. Only one-quarter turned out to have been justified, 
and the coco authority was able to settle practically all of these 
without recourse to TEA, usually by reouiring the signing of a future 
compliance cgrccment. (*) Iio'st of the deviations were by agents 
rather than producers, and producers often cooperated by cancelling 
the contr .cts of the offending distributor. '(** ) In the spring season 
of 1935, since it had become plain that no other penalty than signing 
such an agreement was involved, violations increased rapidly, far 
exceeding the number in 1954. It is oerhaps fair to infer tentatively ■ 
that price filing can be .enforced with reasonable success in this in- 
dustry, ii 'he efforts of the industry itself are bached by govern- 
mental authority, and, that the costs of axlmini strati on would be reason- 
able compared to those involved in enforcing the codes of many other 
industries. . 

II. EFFECT OF SMALL FIEFS 

The evidence indicates that the effect of price filing in the 
fertilizer industry was beneficial rather than injurious to small 
firms. I the first place, the feature of open pricing which is be- 
lieved to be injurious to the small firm in other industries - that it 
brings about price uniformity and thus deprives the small company of 
the lower price which alone pernits.it to market its product in con- 
petition with the highly advertised product of the large concern - is 
seldom significant here. Information obtained during the field trips 
and other contacts with the industry indicates that in many districts 
there was such a differential before the code, (***) but that the small 
company did not have to rely upon it for survival. The farmer knows 



(*) Senate Hearings, lpc. cit ., note p. 8 p. 1755. 

(**) The Fertilizer Unit, Chemical Group, Industry Studies Section, 
Division of Review, has ma.de a careful tabulation of all trade' 
practice complaints, and will doubtless present the results in 
its report. 

(***) See Federal Trade Commission, lp_c. crt . , note p. 39, p. 58 

"the list prices arc considered maximum -iriccs, the independent 
companies usually having to shade these -.rices by a margin of 
a dollar or a dollar and a half nor ton." 



9815 



-45- 

that the -or o duct of the small concern is about as good as that of the 
big concern and, if he wants to buy a special product which the small- 
est producer cannot supply, he cm get it from the stochs of larger 
producers in the shop of the same dealer. 

In the second ;-ilace, small companies appear to have supported the 
code and been anxious for its renewal, "."o small firm wrote to the 1TRA 
durin_. its existence protesting against the price idling plan, whereas 
eight or ten letters of approval were received from small companies. (*) 
Eight similar letters, sent to FRA in response to a request by the 
Secretary of the Association that members of the industry express their 
views on renewal of the law, were reprinted in the Senate Hearings. (**) 
Finally the eight small producers interviewed in Maryland and Virginia 
expressed their satisfaction with the open price plan. 

In the third place, the evidence indicates that small producers 
fared as veil rr better than their bi ger competitors under the code. 
One who reads the price schedules is struck by the large number of 
companies which entered the industry during 1934 - most or all of them 
small firms. The secretary of the Association found himself obliged to 
add 162 names of companies, IIP- of them old firms which had ceased 
operation during the depression, to the "Zone List" during the November 
1933-Ju.ne 1934 selling year, and 91 names, 29 being old firms, during 
the seconc. selling year under the code.(***) -he average size of these 
253 firms is very small. In addition, the tax tag data from four 
South rr. States (table 52) indicate that the business of the small, firms 
increased faster than that of the large firms under the code. (****) 

III. FEELING OF TEE INDUSTRY 

There is no doubt that the overwhelming majority of producers, 
large and sraa.ll, approved of the code, and of the -"rice filing plan 
above all. Ninety letters favoring the r>rice ^rovisiens of the code 



(*) These letters were abstracted from the Work Sheets of the 

Division of Review, (ERA files, Fertilizer Code) f rom FBA Semi- 
weekly Lail Summaries, Fee. 1-140. The writer has been in- 
formed that no letters in opposition to the plan reached the 
ERA after the period covered. 

(**) Lpc. cit. .Note v. 8,1742-1746 MR.Drand has stated that he did 
not suggest that any given position or form be adopted by 
these letters (l T PA Public Hearing on Prices. Transcript of 
Fearing , p. 156). 

(***) Proceedings of the Eleventh Annual Convention of the National 
Fertilizer Association (1935) p. 28. 

(***) The table combines the two influences - entrance of new com- 
panies into the Industry and increasing sales of existing 
companies. 



9815 



-46- 
and only four opnosin^ them, arc known to nave been sent to NRA. (*) 

The opposing letters include the dealer letter already referred 
to; (**) a letter criticizing the effect of the code on government 
bidding and the fixing of trucking allowances (sent in hay 1934 "by a 
Virginia company which in December 1935 expressed itself to field in- 
terviewers as being pleased with the code); the letter which pro- 
tested the inclusion of special mixes in the price schedules; (*** ) 
and one letter not seen. 

IV. POST-CODE PRICE SCHEDULES 

•Since the Schechtcr decision the price filing plan has been 
dropped, and producers send schedules only to competitors requesting 
them in writing. The price lists issued at the end of June 1935 con- 
tained radical reductions (tables 12,53). In its announcement of these 
cuts, one company indicates that the price structure had already been 
breaking down in the last months under the code. 

"The prices themselves are based on our costs at 
various plants. Admittedly the margin is small, 
but we believe, in view of certain sales made 
during the past spring season, these prices are 
just as high as competition will permit." 

This probably refers to violations, since there had been no active 
competition in the spring of 1935 which was reflected in the published 
schedules. The June schedules restored the practice of guaranteeing the 
prices against decline which had been abolished by the code. In 
Eovember an increase in the cash discount allowed in "forth Carolina 
from 10 to 13 per cent brought the guarantee into effect. 

Complete uniformity of both prices rnd terms was maintained 
between the two post-code schedules for Maryland ^^ among the three 
for Virginia which have been examined. 

V. PROPOSED VOLUNTARY CODE 

One evidence of the success of the price filing plan in the 
fertilizer industry is the fact that this is one of the seven in- 
dustries which proposed a voluntary code of fair .trade practices to 
the Federal Trade Commission. A Hearing was held on this matter by the 
Commission on Povcmbcr 25, 1935, at which the Association presented 
the case for the voluntary code, and a representative of mail order 
houses presented arguments agains* the price filing plan included under 
it. ho decision had been handed down by the Commission at the date of 
writing. Judging by statements made by the Association and by pro- 
ducers interviewed on field trips; the industry is united in surnort of 
this code. 



(*) :~RA Semiweekly Mail Summary, Nos. 1-140. Other letters may have 
come in later, but they are not shown on the Work Sheets of the 
Division of Review. 

(**) Sec Chapter V, III 

(***)Scc Chapter IV. IV. D. 



9815 



-47- 

The o'oen-price plan provided under the voluntas code is chan ed 
in several respects from that in operation under 1~PA, not because of 
dissatisfaction with the latter but in order to conform to the changed 
legal situation. The plan may be summarized as follows: 

1. (a) Original price schedules shf.ll be mailed to all 

competitors within districts and sub-districts 
and to the Association (no waiting period bein^ 
. provided. ) 

(b) Changes -and supplements adding or removing one or 
more grades shall be mailed lihe 1 ise, and no more 
than three supplements shall be filed for any one 
schedule. 

(c) In case of conflict, the lists filed with com- 
petitors take -precedence over that filed with the 
Association. 

(a) Each list shall be arted and shall contain in 
definite language all terms of sale (seventeen 
of which rrc armed in the Cede.) 

(e) Within three days after receipt of any request 
for clarification made by the Association the 
member shall file such clarification. 

(.1 ) vThen mailing his first list, a member shall file 
a statement of outstanding contracts in variance 
therewith, including names of ->orchasers. 

2. Every devirtion from price schedules shall be reported to the 
Associati or. within 24 hours, including all terms of the sr.le and the 
point of destination -'but not the purchrser's name. A daily summary 
of such reports shall be mailed oat to all competitors by the Asso- 
ciation. 

3. hembers are to understand distinctly that they ?re free to 
deviate from filet, prices at any time, "irovided it does not involve any 
violation of other provisions of the Code. 

VI. ACCOLIPL-ISEMEnTS AKD DEFECTS 

The purpose of the industry j.;., adcptin;_ price filing was ful- 
filled in its operation. Within the limits set oy imperfect, even if 
not unsatisfactory, enf orcement, "false reports, secrecy, ignorance of 
the true frets" were dispelled, and thus " -roducer, distributor and 
consumer" could "act intelligently in raahing business decisions, par- 
ticularly as to all matters that involve "iricc." (*) This is so for 
two reasons: 



(*) See pa;_.es 19-2C. 



9S15 



- 48 - 

(1) Price schedules '-ere interchanged and filed 
as mublic uocuments, whereas previously it 
had not been so easy to know just what prices 
different companies '.'ere announcing; 

(2) There was good reason, to think that the pub- 
lished trices v.-ere the true wrices wreva.iling 
in the market, whereas previously there was no 
guarantee whatsoever that priva.te discounts 
did not or would not completely alter the 
published -oicture. 

The puroose of the industry to stablize arices was fulfilled. 
Burin; the 13 months of the code the index of fertiliser prices rose 
slowly, the net increase being between 5 and 10 per cent, whereas 
fluctuations before and since have been more ra '.'id. The drop in 
•orices in June 1935 indicates (without aroving) that the code, of which 
the open price provision was felt by the industry to be the most sig- 
nificant feature, nay have been influential in preventing prices from 
f riling. 

The -ooint just made le.~ds to the question of aossible evils re- 
sulting from the open-price plan. Undue stabilization of prices would 
be one of these. The only test of the justification for fertilizer price 
trends under the plan is thrt of the movement of "orices in other similar 
industries. r .hile these comparisons have not been presented here at 
length, the ( incomplete) evidence surveyed in this study does not in- 
dicate that the rise in fertilizer trices has been out of proportion to 
what might be exoected in a oeriod of recovery like tha.t from 1933 to 1935. 

Other possible evils include: (l) Price rigidity due to the realiza- 
tion by fertilizer jroducers that, as soon a.s they sent out schedules to 
all comoetitors announcing a -'rice cut, it would a.t once be met by all, 
and no advanta :e would-be gained. In spite of this factor, price cuts did 
occur under the code, and the deep cut of June 1935 took wlace with full 
knowledge on the part of the or ice leaders that they would be followed by 
the rest - as did ha? jen in fact. It seems likely that a more effective 
form of control than a ;orice filing plan ^ould be reouired to arevent 
price cuts really demanded by changes in market conditions. 

(2) In some industries small firms have complained that the loss of 
their price differential under the omen price regime results in loss of 
the market to bigger and more widely known competitors. This has not 
happened in the fertilizer industry. 

(3) A rrice filing plan may be the instrument of standardizing 
pricing and marketing loractices. This has bee:i so under the fertilizer 
code. It is not yet proved, however, that the extent to which this went 
in this industry constitutes an "evil". 

(4) Enforcement has not iroved the insuperable problem that it often 
feared. Violations were many', but with more authority added to the tech- 
niques which "ere develoaod for coming ' ith them under the code, it seems 
probable thrt the-' could have been nearly wimed out. The state of affairs 
is the more encouraging since this industry is one in which the large numb- 
er and small size of the comoetitors woulu seem to make success of coooera- 
tive action, including jrice filling, less likely than in more concentrat- 
ed industries. 



9815 



-49- 

APPSI-DIX I 

METHODS A2TD FURTHER RESEARCH 



I. JiETHODS 

The statistical Stud;/ of the fertilizer price schedules contained 
two steps.. The first Fas the transcription of the 'orices and terras 
of sale, zone by ztfne, on work sheets. This could he done in such a 
way as to disclose either their trend or their uniformity at any one 
time.' In each case the terras would be listed vertically down the left- 
hand side of the sheet. To: show the trend, the terras of one company 
were carried through the code period from the first schedule to the 
last, under date captions across the top of the "oage. To show the 
uniformity, the terras" of the price leader made effective on any given 
date would be 'summarized in the first' column, and deviations by each 
other company in its schedule or schedules becoming effective between 
the date mentioned and the next date on which a schedule of a price 
leader became effective would be checked in the succeeding columns. ; 

On the basis of "these work sheets, the tables were constructed 
from which those in 'Chapters IV, V and VI '-ere selected. The use of 
elaborate statistical methods on these data, was not justified, since 
(l) there were no consistent -ore-code nor post-code figures with which 
to make comparisons (and, 'of course, there were no non-code figures 
for the same period); (2) -the period in which -orice filing was in ef- 
fect was too short - including on the average only four price changes 
(less in some zones and more in others); and (3) it was evident that 
statistical results "hi ch might have been drawn in certain cases would 
give a false impression unless modified to the simple conclusions that 
would have followed knowledge" of the industry's practices in any case. 
To give one illustration, tables were set up (following the lead of 
table 7) which showed- the number of ' companies- quoting each specific 
price daily during the code period. It soon appeared, however, that 
the diversities were mainly due to delays in formally announcing price 
changes which the companies involved were going to declare, as a matter 
of course, a.s soon as they were ready to enter the market. In other 
words, a simpler table like No. 13 expressed the situation better. 

To sura up the difficulties which really prevent making a reliable 
judgment on open prices in this industry, (l) the -orice filing plan 
covered only two selling seasons, the first of which is not accepted by 
the Industry as giving a fair picture since the com-oanies were only just 
learning how to use the plan, and the secend of which is not accented 
because the growing difficulties of "RA enforcement were beginning to 
have demoralizing effects even in the best run codes such as this one; 
and (2) the effects of the open-price plan on the level of prices and 
on sales, production, profits, etc. , cannot be disentangled from the 
effects either of the code as a whole, or of the cooperation engendered 
in the industry bv the 17RA program, or of all the political and econom- 
ic influences of the period. Thus the code or the open-price plan 
itself might have helped to raise the price level from a depressed to 
a normal level, but this might not indicate what effect it would have 
if prices had already been profitable. 

9815 



-so- 
il . FURTHER RESEARCH 

Any further research on oroen prices in the fertilizer industry should 
crobably stress field work* This should involve the determination (oarticulcrl 
by interviewing small manufacturers) of the following: 

(1) Whether .the crice filing nlan caused com-oanie a 
to refrain from tirice actions they would other- 

■ .'- wise have taken, due to realization that the 

change would he met immediately by competitors, 
and how far different the situation in this regard 
had been before the Code; 

(2) Whether the uniformity of trices that resulted 
was any greater, in actual fact, than before the 
Code, and whether it had an injurious effect 

on -the -position of small as comoared to large 
companies, or would have had such an effect in 
the long run; 

(3) How much effort would be necessary to secure com- 
nliance with any t>rot>osed future crice filing 
nlan; 

(4) How far a voluntary nlan would be accepted by 

the Industry and how far it ^ould check discrimina- 
tion, ignorance and resulting demoralization; 

How far i>t was the filing of -orices which ac- 
complished the results desired by the Industry 
and how far it was such other elements as the 
delivered nrice system and the adoption of the 
consignment system of selling. 



9815 



-51-T 

APPENDIX II 
I. A PRICE SCHEDULE 

X COMPANY 
GENERAL OFFICES: XX 



Schedule #13 

Zone 5 

April 2, 1935 



Mr. Chas. J. Brand, Executive Sec. & Treas. 
The National Fertilizer Association 
Washington, D. C. 

Dear Sir: 

Attached is our schedule No. 13 for Zone 5, filed 
to meet competition of International Agricultural Corpora- 
tion, their schedule No. 13, dated March 26, 1935. 

STATEMENT OF CHANGES 

The only changes from our previous schedule are 
in DELIVERY provisions, and AGENT'S COMPENSATION Ufa 
Nitrate of Soda -and Sulphate of Ammonia in small lots - 
which reflect competitive conditions as outlines in 
current price lists of Southern Cotton Oil Company and 
numerous other producers in South Carolina. 

Prices are identical with those in our Schedule 
No. 12. 



Very truly yours, 
X Company 

CERTIFICATE OF MAILING 

This is to certify that true copies of this 
schedule are being mailed to producers operating in this 
zone simultaneously with this mailing to your office and 
to the Zone Secretary. (V)* 



Items marked V, represent checks made by The National 
Fertilizer Association. 



9815 



-52- 



COMPANY ' " Schedule #13 

Zone 5 



April 2, 1935 



CONSUMERS' DELIVERED PRICE LIST 
SPRING SEASON 1935 
SOUTH CAROLINA 
Subject to change on due notice 

1. PRICES ; Mixed fertilizer, Superphosphate and/or fertilizer 
materials are to be priced and sold only to consumers, either 
direct by us. or through our duly appointed agents. Attached 
are consumers' delivered to the farm basis and cash prices. 
At our option, shipment may be made in carload quantities to 
any regular railroad or boat landing delivery point, or loaded 
on trucks at our factories, and delivery to the farm effected 
as provided in Paragraph 3. (V)* 

2. LESS CARLO T SHIPMENTS: Shipments by rail .in less than carload 
quantities will be sold to consumers direct or through agents 
at the prices hereinafter provided, but agent's compensation 
will be reduced by $1 per ton_ on such shipments to offset the 
extra expense of handling and delivery. (V)* 

3. DELIVERY : . 

( a ) Delivery from railhead, boat landing or agents' ware- 
houses : T7hen shipments are made by rail, boat, or 
our company owned or controlled trucks, a compensation 
of 75^ per ton will be paid for delivery service from 
railhead, boat landing, or agents' warehouses to buy- 
ers' premises. (V)* 

(b) Uhen trucks, other than our own, are employed to trans- 
port fertilizer to buyers' premises or agents' ware- 
houses, they will be compensated according to the dis- 
tance hauled at the following rate per ton: (V)* 



.75 per 


ton 


from 


1 


to 


15 


miles 


(Highway 


mileage) 


1.00 per 


ton 


from 


15 


to 


25 


miles 


( 


n 


ii ) 


1.25 -oer 


ton 


from 


25 


to 


35 


miles 


( 


ii 


n ) 


1.50 3 er 


ton 


from 


35 


to 


50 


miles 


( 


it 


ii ) 


1.75 per 


ton 


from 


50 


to 


75 


miles 


( 


it 


ii ) 


2.00 per 


ton 


from 


75 


to 


100 


miles 


( 


n 


" ) 


2.25 per 


ton 


from 


100 


to 


125 


miles 


( 


it 


ii ) 


2.50 per 


ton 


from 


125 


to 


150 


miles 


( 


ii 


ii ) 


2.75 per 


ton 


from 


150 


to 


175 


miles 


( 


ii 


ii ) 


3.00 per 


ton 


over 


— - 


— 


175 


miles 


( 


ii 


ii ) 
(V)* 



9815 



-53- 

Except in the case of the first 75^ per ton trucking com- 
pensation which will be deducted from the price per ton, 
all other truck transportation costs are to be treated as 
a separate and distinct transaction from the sale of fer- 
tilizer and paid not more frequently than once a week upon 
receipt of regular itemized invoice or statement from the 
truck owner, showing to whom the fertilizer was delivered, 
the distance hauled, and all details. (V)* 



4. TERMS: 



(a) Cash prices to be charged for payments made prior to 
June 30, 1935 are determined by deducting from the consumer's 
delivered basis prices herein provided as follows: (v") J 



\* 



For Mixed Fertilizer, Super-phosphate and Fertilizer Materials , 
Except Ilitrate of Soda and Sulphate of Ammonia : (V)* 

For cash paid: 



On of before March 15, 1935 13;< 







9815 



Between March 15 and April 15, 1935 . . . \2rjo 

Between April 15 and May 15., 1935 11$ 

Between May 15 and Mey 31, 1935 9$ 

Between May 31 and June 30, 1935 7;o 

(V)* 

For Nitrate of Soda end Sulphate of Ammonia : 
For cash sales to consumers: 

Any time prior to June 30, 1935 13$ (V)* 

(b) For cash in advance of shipments deposited with us 
prior to March 1st, interest, from the day received to 
March 1st, at the rate of 7/b per annum, will be allowed. 
After March 1st cash paid in advance of shipments will be 
credited on the basis of the attached price list. (V)* 

(c) For time payments, notes are to be taken at the basis 
prices bearing interest from July 1, 1935, until paid at 
the rate of 7,o per annum. (V)* 

(d) From July 1, 1935, to maturity of notes the basis 
prices will aoply plus interest from July 1, 1935, and 
subject only to discount for anticipated payment of notes 
from date paid to maturity, at the rate of 7} per annum. (V)* 

5. COHSuina ' S QUANTITY DISCOUNT ; A consumer purchasing mixed 
fertilizer and/or Superphosphate, or purchasing fertilizer 
materials, direct from us or through any one of our agents, 
for use on farms individually owned, controlled or operated 
by himself, and not for re-sale, will be entitled to the 
following quantity discounts, depending upon t he quantity 
purchased. (V)* 



-54- 



MIX3D raaTiLi'zm and/ on supijjrfhospeats 

Less than 50 tons No quantity discount 

From 50 to 88 tons 2x> quantity discount 

100 tons or over 5,o quantity discount 

• ' ■ (V)* 

■ F^ TILIZER MAT TRIALS : 

Less than 100 tons No quantity discount 

From 100 to £99 tons ljo quantity discount 

• From 500 to 499 tons 2$ quantity discount 

500 tons and over 3;o quantity discpunt 

These quantity discounts will he figured on the consumer's "basis 
price provided herein and will apply on all tonnage of mi:ced fer- 
tilizer and/or Superphosphate and all tonnage of fertilizer mate- 
rials purchased from us direct or through any one of our agents 
"between Nov. .19, -1934 the effective date of this schedule and 
June 30, 1935. (V)' 



■ * 



The tonnage of fertilizer materials purchased may not "be used 
in determining the tonnage for quantity discounts on mixed fer- 
tilizer and/or Superphosphate; neither, may the tonnage of mixed 
fertilizer and/or ■ Superphosphate be used in determining the 
quantity discount applicable on fertilizer materials. (V)* 

These quantity discounts are not to be deducted from the con- 
sumer's price at ■time of sale, nor allov?ed on invoices. They 
will be due and payable at the end of the season after purchases 
have been completed. (V)* 

When the sales are made through an agent the amount of such 
quantity discounts shall be deducted from the agent's compen- 
sation, as hereinafter provided. ( w* 

6. BAGS ; The prices attached are for Mixed Fertilizer and Super- 
phosphate and Fertilizer Materials (except Nitrate of Soda and 
Sulphate of Ammonia) shipped in 200-lb. burlap bags. When other 
sizes are used, add to the consumer's basis prices the following: (V) 5 

25^ per ton for 167-lb. bags 
50{* per ton for 125-lb. bags 
75y* per ton for 100-lb. ba^s 

(V> 

Bag sizes for Nitrate of Soda and Sulphate of Ammonia appear on 
the attached price list. 

For any goods shipped in cotton bags, an extra charge is to be 
added to the consumers' basis prices of $1 per ton over the price 
for burlap bags, to cover increased cost. (V)* 



9815 



-55- 

7. TOBACCO FERTILIZERS : There will he an additional charge of 
$2.50 per ton on the consumers' basis price for all grades 
formulated for use on tobacco,' to cover the additional cost. 
This extra charge is to be added to these consumer basis prices 
and included in the price per ton in contracts and quotations 
for tobacco goods. (V)* 

8. SULPHATE OF POTASH : For goods requiring a specified quantity of 
Sulphate of Potash, an extra charge is to be added to the con- 
sumer basis prices at the rate of 40 cents per unit for each 

unit or fractional part thereof derived from Sulphate of Potash. (V)* 

9. COTTON SEEL I/iEAL : Meal body goods (the amount of meal used not 
to exceed 100 pounds to the ton) may be furnished without .chr.rge. 
For goods carrying an additional quantity of cotton seed meal, 
add to the consumer's basis prices herein provided $1.00 per ton 
for each 100 pounds of cotton seed meal used. (V)* 

10. GRADES : Sales must be confined to the grades shown on the attached 
price sheet. (V)* 

(a) If a sufficient demand for other grades develops to 
justify the publication of a new price list, we will use 
as a base price 8 — 3 — 3 at $26.70 per ton, in 200-lb. bur- 
lap bags, and figure up or down as follows to determine the 
consumer's basis, price on the grades desired: (V)* 

Ammonia $2.09 per unit 

A. P. A. .65 per unit 

Potash .50 per uni.t^ 

(b) If special mixtures are made on buyer's formulas, 
there will be an extra charge of $1.50 per ton in ad- 
dition to the price determined on the above basis, plus 
a further additional charge to cover the extra cost of 
any special materials used. (V)* 

(c) If materials listed herein are mixed to order of 
buyers, there will be a charge of $2 per ton added to 
the bagged price of the materials used to make the mix- 
ture, provided that in no case shall the price so de- 
termined be less than the price for the same analysis 
determined as in paragraph (a) above, (y)' 



I* 



11. BULK SALES : One dollar ($1.00) per ton will be deducted from 
the consumer basis prices for mixed fertilizer and/or Super- 
phosphate and/or fertilizer materials when sold and shipped in 
bulk. (V)* 



9815 



-56- 

AGENCY PROVISIONS 

12. SALES THROUGH AGENTS : Agents must sell goods to consumers at the 
prices provided herein. Sales through agents must, without ex- 
ception, be covered by duly executed contract. Agency contracts 
must specify that the agent agrees to be bound by the Code of Fair 
Competition to govern the fertilizer industry, as approved by the 
National Recovery Administration, and accepts personal liability 
for all penalties resulting from his failure to comply with the 
provisions of his contract, and furthermore, agrees to forfeit any 
and all compensation e arned, or to be earned, under the terms of 
his contract, if he violates the provisions thereof. (V)* 

13. AGENT ' S COMPENS AT ION : 

(a) Any individual, partnership or corporation that operates as 
a merchant with an established place of business in which he 
regularly stocks and offers for sale a variety of farm supplies 
and sells fertilizer at the producer's published price list is 
entitled to the agent's compensation. The operation of a com- 
missary does not qualify for agent's compensation under this par- 
agraph, (v)* 

(b) Any other individual, partnership or corporation represent- 
ing us as an agent that distributes at the consumers' prices herein 
provided, a minimum of 100 tons of fertilizer and/or Superphosphate 
and/or fertilizer materials between the effective date , < Nov". '19, 
19S4, of this schedule and June 30, 1935, will be paid the agent's 
compensation, but with this class of distributor the compensation 
is in no case to be paid or allowed until he has qualified as an 
agent by distributing a minimum of 100 tons. 

(c) Any individual, partnership or corporation that distributes 
for us at the consumers' prices herein provided, but distributes 
less than 100 tons and does not qualify for the agent's compen- 
sation under paragraph (a), will be entitled only to the quantity 
discount on a tonnage basis provided for consumers in Section 5.(V)* 

Determination as to whether or not distributors under paragraphs 
(b) and (c) are entitled to the agent's compensation is to be 
based on the quantity distributed for all producers and not for 
any one producer. If the distributor under paragraph (b) or (c) 
does not represent us exclusively, he will be required before pay- 
ment of any compensation or quantity discount to certify to the 
total tonnage distributed, naming the producers for whom he dis- 
tributed and the quantity for each. (VJ* 

For the whole and complete performance of the terms of his contract 
with us, the agent will be paid the following compensation for sell- 
ing at the consumers' prices authorized herein: (*)■* 



9815 



-57- 

On cash sales of Mixed fertilizer, Superphosphate and materials 
(except Nitrate of Soda and Sulphate of Ammonia) — ^ 

5$ of the bads prices herein -;rovided. (V)* 

On cash sales of Hit rate of Soda and Supphate of Ammonia — 

$2.20 per ton. (V)* 

On time sales, the agent must guarantee absolutely and uncondit ion- 
ally prompt and coimlete payment of all notes and accounts resulting 
from sales made on time basis, and he will be paid an additional 5^ 
compensation on the basis orices herein provided. (V)' 



\* 



Goods paid for prior to July 1, 1935 are to be construed as cash 
sales and the agent will not bo entitled to the additional 5;j compensa- 
tion for guaranteeing payment of time spies on such business. (V)" 



i* 



Where an agent furnishes special service or terms, such as ware- 
housing goods or selling on time, to trade unacceptable to us, he may 
charge an amount separate and apart from the price of the fertilizer 
sufficient to repay him for special services rendered, or commensurate 
with the credit risk assumed. (V)* 

14. AGENT'S QJJAIITITY DISCOUNT ; In addition to the compensation s et 
forth in Section 13 of this schedule, agents will be paid the following 
quantity discounts, depending upon the quantity of mixed fertilizers 
and/or Superphosphate and the quantity of fertilizer materials sold . 
and delivered for producers: (V)* 

MIXED F25TIIIZ5R A1ID/03. SU?ZH?E0S?KAT3 

Less than 250 tons No quantity discount 

From 250 to 499 tons 1$ quantity discount 

Prom 500 to 999 tons 2$ quantity discount 

Over 1,000 tons 3$ quantity discpunj 

14. AGFHT'S QUANTITY DISCOUNT : (continued) 

FERTILIZES MATERIALS 

Less than 500 tons To quantity discount 

From 500 to 999 tons ..-.;• ly> quantity discount 

From 1,000 to 1,499. . . " 2$ quantity discount 

Over 1,5000 tons 3;j auantity discount 

' - J (V)* 

Agent's quantity discounts will ap^ly on all tonnage of mixed 
fertilizers and/or Superphosphate -and all tonnage of fertilizer 
materials sole, and delivered for us between Nov. 19 r 19S4 and . Jtme 
30, 1935, and will be figured from the consumer's basis prices pro- 
vided herein. The total tonnage of mixed fertilizer and/or Superphos- 
phate and the total, tonnage of fertilizer materials sold and delivered 
for all producers, and not for any one producer, will be' the determining 



9815 



-58- • ' 

factor as to the quantity discounts to which the agent is entitled, if 
any. (V)* 

The tonnage of mixed fertilizer and/or Superphosphast may net he 
counted in determining the quantity discounts to he allowed on fertilizer 
materials. Neither may the tonnage of fertilizer materials he counted 
to determine the quantity discounts to he allowed on mixed fertilizers 
and/or Superphosphate. (V)* 

Agent's quantity discounts are not to he paid at the time of ship- 
ment or sale or deducted from invoices, hut will he due and payable at 
the end of the season, after we have estahlished the exact facts as to 
the quantity distributed hy the agent. If the agent does not sell 
exclusively for us he will he required to certify to the total tonnage 
sold and delivered, naming the producers for whom he distributed it. (V)* 

15. CASH GUAPAIITEE DEPOSIT BY AGEUTS : Agents may take advantage of 
the consumer discounts outlines in Section 4 hy placing funds with us 
prior to the varying discounts dates, provided that in selling to con- 
sumers the agent will adhere strictly to the prices, terms and con- 
ditions of this schedule. In such cases the discounts on funds so de- 
posited hy the agent in excess of any discount due the consumer when 
he pays for the goods are considered as additional compensation earned 
hy the agent through the use of his money to finance the consumer buyer. 
Except on Nitrate of Soda and Sulphate of Ammonia, where the agent 
deposits cash in advance of shipment or takes goods order notify 
S.D.B.L., he will he allowed an additional compensation equal to two 
percent (2)j) of the consumer's hasis prices to further compensate him 
for financing the "business. In no care is this discount to be allowed 
to the consumers. (V)* 

16. SETTLEMENT: Agents are to remit cash. promptly as collected for 
all sales, and final accounting for all goods shipped is to be made on 
demand by us, but not later than the termination of the heavy shipping 
season in each territory, when all open accounts are to be closed by 
cash for cash sales and by c-->sh or notes for time sales. If any agent 
fails to remit cash promptly as collected, we will deduct from such 
agent's compensation an amoxint equal to the difference between the 
consumer's cash price in effect at time of remittance and the consumer's 
cash price in effect at time of sale. (V)* 

17- ON^HAND GOODS : All goods remaining In .the hands of agents from 
season to season, or when We issue a new or changed price list, must be 
sold in accordance with the new or changed price list, on and after its 
effective date. (VJ* 

18. CONTRACTS AND INVOICES: Contracts are to be made, prices quoted, and 
the compensation of agents and all discounts are to be calculated on the 
comsumers 1 basis prices provided herein. Invoices are tn he rendered at 
these consumer's basis prices on all shipments except where goods are 
paid for prior to delivery, when our published cash prices may be used. (V) 



* 



QfllB 



-59- 

19. MATURITY OF NOTES : Notes must "be made to mature at dates coinciding 
With the early -part of the marketing season for the crops for which the 
fertilizer is sold. (Vj* 



Agents' guaranty notes for fertilizers used on truck crops should 
mature average July 1 to August 1, 1935;^ for cotton and tobacco goods, 

lg£ 



average October 1 to November 1, 1935. (V) 1 



Consumers' notes should mature thirty (30) days earlier than agent's 
average maturity dates. (V)* 

Particular attention 'must be given to making average note maturities 
as early as consistent with the crop and marketing conditions in each 
section. (V)* 

20. SALES TO GOVEF-NmEIITAL AGENCIES, ETC.: Quotations and sales (made 
direct and not through agents) to agencies of the Federal or State 
Government, or political subdivisions thereof, purchasing fertilizer 
for use on State or Federal cvmed or operated farms or projects, and 
eleemosynary institutions, will be. made on open, basis at th. consumer 
cash prices herein provided for payment between April 15 and May 15, 
iess the following discounts: (V)* 

Mixed fertilizer, sun o mho s-o hate and fertilizer materials (except 
Nitrate of Soda and Sulphate of Ammonia) 10$ flat. (V)* 

Nitrate of Soda and Sulphate of Ammonia-Consumers' listed cash 
prices less $2.20 per ton. 

The above disccmnt includes both cash and quantity discounts to 
this class of buyer, and no other discounts or compensations (except 
delivery compensation, Clause 3) of any kind will apply. • The small 
profit provided in this schedule will not permit any reduction in 
accordance with the President's Executive Order N . 6767, and the 
prices as determined above are absolutely net. to us, (V)' 



i* 



21. SPRING SALE PERIOD : Sales may.be made under this schedule for 
shipment any time prior to July 1, 1935, in accordance with the prices, 
terms and conditions outlined herein. (V)* 

22. Shipments will be made uider this schedule from our factories at 
Norfolk, Va., Charlotte and Wilmington, N. C, Columbia and Spartan- 
burg, S. C, and fertilizer materials from customary Atlantic ports. (V) s 

We have no distributing warehouses. 



9815 





















-6C 


- 




























X 


COMPANY 
























CONSUMERS ' 


DELIVERED ? 


RICE 


LIST 
























SPRING SEASON 1935 






- 




















SOUTH CAROLINA 












iLYSIS 


Consumers ' 
Basis 






FOR 


SHIPMENT III 


200-POUND 


BURLAP 


BAGS 






On 
Be 


or 
fore 






CONSU 


I.iERS ' 


PRICE 


S FOR 


CASH PAID — 




Marc 






B E 


T V; 3 


E N 






an; 


h 15 


April 15 


May 


15 & 


June 


1 & 


AP. 


AM. P 


•Prices* 




Ma 


r. 15 


&Avr 


. 15 


& May 15 


June 1 


June 


30 


12 


4 


4 


$31 


.90 ( 


V)* 


$27 


,75 


$28 


.07 


$28 


.39 


$29 


.03 


$29 


.67 


12 


4 


2 


30 


.90 ( 


V)* 


26 


.88 


27 


.19 


27 


.50 


28 


.12 


28 


.74 


12 


3 


5 


30 


.30 ( 


V)* 


26 


.36 


26 


. 66 


26 


.97 


27 


.57 


28 


.12 


12 


3 


3 


29 


.30 ( 


V)* 


25 


.49 


25 


.78 


26 


.08 


26 


.66 


27 


.25 


10 


4 


6 


31 


.60 ( 


V)* 


27 


.49 


27 


.81 


28 


.12 


28 


.76 


29 


.39 


10 


4 


4 


30 


.60 ( 


V)* 


26 


.62 


26 


.93 


27 


.23 


27 


.85 


28 


.46 


10 


4 


2 


29 


.60 ( 


V)* 


25 


.75 


26 


.05 


26 


.34 


26 


.94 


27 


.53 


10 


4 





28 


.60 ( 


V)* 


24 


.88 


25 


.17 


25 


.45 


26 


.03 


26 


.60 


10 


3 


6 


29 


.50 ( 


V)* 


25 


.67 


25 


.96 


26 


.26 


26 


.85 


27 


.44 


10 


3 


5' 


29 


.00 ( 


V)* 


25 


.23' 


25 


.52 


25 


.81 


26 


.39 


26 


.97 


10 


3 


3 


28 


.00 ( 


V)* 


24 


.36 


,24 


64 


24 


.92 


25 


.48 


26 


.04 


10 


.2 


4 


26 


.40 ( 


V)* 


22 


.97 


23 


.23 


23 


50 


24 


.02 


24 


.55 


10 


2 


2 


25 


.40 ( 


V)* 


22 


.10 


22 


35 


22 


61 


23 


.11 


23 


.62 


9 


3 


7 


29 


35 ( 


V)* 


25 


.53 


25. 


83 


26. 


12 


26 


71 


27 


30 


9 


2 


2 


24. 


75 ( 


V)* 


21 


53 


21. 


78 


22. 


03 


22 


52 


23 


02 


8 


4 


6 


30. 


30 ( 


V)* 


26. 


36 


26. 


66 


26. 


97 


27, 


57 


28. 


12 


8 


4 


5 


29. 


80 ( 


V)* 


25. 


93 


26. 


22 


26. 


52 


27. 


12 


27. 


71 


8 


4 


4 


29, 


30 


V)* 


25. 


49 


25. 


78 


26. 


08 


26. 


66 


27. 


25 


8 


4 


2 


28. 


30 ( 


V)* 


24. 


62 


24. 


90 


25. 


19 


25. 


75 


26. 


32 


8 


4 





27. 


30 


[V)* 


23. 


75 


24. 


02 


24. 


30 


24. 


84 


25. 


39 


.8 


3 


10 


30. 


20 


;v)* 


26. 


27 


26. 


58 


26. 


88 


27. 


48 


28. 


09 


8 


3 


8 


29. 


20 


y)* 


25. 


40 


25. 


70 


25. 


99 


26. 


57 


27. 


16 


8 


3 


5 


27. 


70 


(V)* 


24. 


10 


24. 


38 


24. 


65 


25. 


21 


25. 


76. 


8 


3 


3 


26. 


70 


;v)* 


CO. 


23 


23. 


50 


23. 


76 


24. 


30 


24. 


83 


8 


3 





25. 


20 


Iv)* 


21. 


92 


22. 


18 


22. 


43 


99 


93 


23. 


43 


8 


2i 


1 


24. 


65 


(V)* 


21. 


45 


21. 


69 


21. 


94 


22. 


43 


22. 


92 


8 


2 


2 


24. 


10 


(v)-* 


20. 


97 


21. 


21 


21. 


45 


21. 


93 


22. 


41 


7 


5 


7 


32. 


25 


(v)* 


28. 


06 


28. 


38 


28. 


70 


29. 


35 


29. 


99 


7 


5 


5 


31. 


25 


(V)* 


27. 


19 


27. 


50 


27. 


81 


28. 


44 


29. 


06 


6 


4 





26. 


00 


(V)* 


22. 


62 


22. 


88 


23. 


14 


23. 


66 


24. 


18 



erest from July 1, 1935 at 7 -> per annum. 



9815 



-61- 
X COMPAHY 
COHSUMZRS 1 DZLIVSRZD PRICF LIST 
SPRI1IG SFAS0IT1935 
SOUTH CAROLINA 



FOR SHIPMENT Hi 200-POUHD BAGS 



COITSUMSRS' PRICES FOR CASH PAID 

Consigners On or 3.5 117 S 5 H 

ANALYSIS Basis Before March 15 Aoril 15 May 15 & 



AP AM. Pot. Prices * Mar. 15 &Aor. 15 & May 15 June 1 

4 10 $37.25 V* $32.41 $32.78 $33.15 $33.90 

2 10 4 39.25 7* 34.15 34.54 34.93 35.72 



4 li 



2k 



4 7^ 

10 4 

18 

16 



12 


3 


5 


12 


3 


3 


10 


4 


6 


10 


3 


5 


10 


3 


3 


.8 


4 


6 


8 


4 


5 


8 


4 


4 


8 


3 


5 


8 


3 


3 


8 


2* 


1 


8 


2 


2 



33.25 V* 28.93 



29.26 



32.00 V* 27.84 28.16 

22.25 V* 19.36. 19.58. 



23.45-V* 20.40 
22.15 V* 19.27 

T B 



20.64 
19.49. 



A C C G R A D. 



29.59 


30.26 


28.48 


29.12 


19.80 


20.25 


20.87 


21.34 


19.71 


20.16 



32.80 V* 28.54 
31.80 V* 27.67 
34.10 V* 29,67 

31.50 V* 27.41 
30.50 V* 26.54 
32.80. V* 28.54 

32.30.V* 28.10. 
31.80 V* 27.67 
30.20 V* 26.27 

29.20 V* 25.40 
27.15 V* 23.62 
26.60 V* 23.14 



June 1 & 
J-unc 30 

$34.64 
36.50 
30.92 

29.76 

20.69 

21.81 
20.60 



28.86. 


29.19 


29.85 . 


30.50 


27.98. 


28.30 


28.94 . 


29.57 


30.01. 


30.35 


31.03 


31.37 


27.72. 


28.04 


28.67 


29.30 


26.84 


27.15 


27.76 


28.37 


28.36 


29.19 


29.85 


30.50 


28.42 


28.75 


29.39 


30.04 


27.98. 


28.30 


28.94 


29.57 


26 . 58 


26.88 


27.48 


28.09 


25.70 


25.99 


26.57 


27.16 


23.89 


24.16 


24.71 


25.25 


23.41 


23.67 


24.21 


24.74 



(*) For time prices adc 1 . interest from July 1, 1935 at 7^ per annum. 



9815 



-62- 



SPRING SEASON 1935 

SOUTH CAROLINA 

FERTILIZER MATERIALS 

Cons-umers' Delivered Price List for Sales Direct or Through Agents 

These material prices are quo tee for shipment along with manufactured 
goods and sale in less car and mixed car lots direct by us or by our agents. 
A consumer purchasing is solid carload lots of any one material for his own 
use will be allowed $1 per ton from these prices. This $1. per ton will be 
credited to agen,ts as a dditional compensation when they order in solid car- 
load lots of any one material, but if the agent sells from such orders in 
less than carload quantities, he must sell at these less carload prices. (V)* 



FOR SHIPMENT IN 200-POUND BURLAP BAGS 



MATERIAL 



Kainit, 14$ 
Kainit, 20$ 

Potash Salts, 30$ 

Potash Salts, 25$ 
Mur. of Pot., 50$ 
Sul. of Pot. Mag.. 26$ 
Sul. of Pot., 48$ 
Raw Bone Meal 
(Am. 4.50$, TPA 21.50$) 
Pine Ground Bone Meal 
(Am. 3.00$, TPA 23.00%) 



: Consumers' On or 
Basis Eefore 

S Prices* Mar 



CONSUMERS' PRICES FOR CASH PAID — 

BETWEEN - 

March 15 April 15 May 15 & June 1 & 
15 Apr. ^15. fcMay 15 June 1 June 30 



$22.00V*$19.14 ' $19.36 '$19.36 $20.02 $20.46 
22.20 V* 19.30 19.54 19.76 20.20 20.65 

28.40 V* 24.71 24.99 25.28 25.84 26.41 



25.70 V* 22.36 22.62 22.87 23.39 23.90 

37.20 V* 32.36 " 32.74 "33.11 33.85 34.60 

38.50 V* 53.76 34.14 34.53 35.31 36.08 



54.35 V* 47.28 


47.83 


48.37 


49.46 


50.55 


44.00 V* 38.28 


38.72 


39.16 


40.04 


40.92 



44.00 V* 38,28 



38.72 



39.16 



40.04 



C. S. Meal (Am. 7.00$) 
Dried Blood (Am v 16$) 
Fish Scrap (Am. 11$) 



Animal T a nkage 
(Am. 10$, APA 6$) 



53.00 46.11 



46.64 



47.17 



48.23 



40.92 



51.00 V* 44.37 44.88 45.39 46.41 47.43 

74.00 V* 64,38 . 65.12 .'65.86 '67.34 68.82 

48.00 V* 41. 76 42.24 '42.72 ' 43.68 44.64 



49.29 



NITRATE OF SODA AND SULPHATE OF AMMONIA • 

The following prices on Nitrate of Soda and Sulphate of Ammonia are 
quoted for sale on terms as outlines in paragraph 4, cash prior to ship- 
ment, or order notify S.D.B.L. (V)* 



MATE RIAL 



BAG SIZE 



Nitrate of Soda (Ammo. 18$) 100-lb. 

Nitrate of Soda (Ammo. 18$) 200-lb. 

Sulphate of Ammonia (Ammo. 25$) 100-lb. 

Sulphate of Ammonia (Ammo. 25$) 200-lb. 



BASIS PRICE* 


CASH PRICE 


$=39.65 V* 


$34.50 


38.85 V* 


33.80 


39.65 V* 


34.50 


38.85 V* 


33.80 



(*) For time prices add interest from July 1, 1935, at 7$ per annum. V* 



-63- 

Agreenent Between 
ThE X FERTILIZER CGIIPMY 



Date. 



P.C. 



1. We hereby anoint ycu our agent, and agree to consign to you 
such amounts anc?. kinds of fertilizers as from time to time shall be 
mutually agreeable, . to be sold by you as our agent for our account 
upon the terms and conditions hereinafter provided, and, or set forth 
in our price lists issued from time tc time, which lists and their re- 
spective effective periods shall be deemed to be and become a part of 
this contract. We agree to pay you such commissions as set forth in 
these current- lists as full compensation for all services rendered by 
you in the fulfillment of this contract. 

2. You agree to furnish us a full account of your sales and 
fully complete your settlement with us on the basis of prices and terms 
issued to you in our current price lists. All casb received by you as 

'. roceeds of cash sales and other collections shall be key>t by you 
serrate and distinct from other monies and promptly remitted to us. 
All fertilizers consigned to you aereunder, the cash, notes, accounts 
and proceeds thereof, resulting from the sale of said fertilizers, 
shall at all times be and remain our property and subject to our order. 
"vThenever our price lists provide that you may accent customers 1 notes, 
we may at our election, return to you all or any part of such notes 
for collection, free of expense to us, and ycu agree to hold such notes 
and all proceeds thereof as our property and to immediately remit such 
~roceeds tc us. You agree absolutely and unconditionally to guarantee 
payment when due, of all accounts representing sales of fertilizers 
consigned to you hereunder. 

3. This agreement shall remain in effect as to all future business 
until cancelled in writing "oy wire or letter by either you or us, and 

in any event as to any business commenced or liability incurred there- 
under, until the same has been fully completed and satisfied. If this 
agreement is terminated for any reason all obligations arising there- 
under shall, at our option, become due and payable immediately. We re- 
serve the right to withhold further deliveries in case of any report 
or occurrence regarded by us as unfavorable tc your credit, or in the 
event of any breech of this agreement ''oy you. 

4. You agree tc keep separate "roper books and records covering 
all transactions hereunder and we shall have access at any time to 
such books and records, if we so desire. You agree to furnish us when- 
ever required, a complete statement of all sales of fertilizers, a list 
of purchasers 1 names in full and the post office address of each end 
also a report of your stock on hand. 



9315 



-b<±- 



5. You a^ree "hereby to be bound by and to comply with the pro- 
visions of any Code and any rules or regulations -promulgated there- 
under, approved by the National Recovery Administration and adopted 
by us, relating to sales of our products, and agree to indemnify us 
against any loss or damage resulting from your breach or failure to 
comply with any of the provisions of this contract. 

6. V/e shall not be liable in any respect for any failure or 
delay whatsoever, in the fulfillment or the performance of this con- 
tract, or any sales or orders taken hereunder, if prevented or hindered 
by any cause beyond our reasonable control. 

Accepted and agreed to this day of Signed in duplicate, 

, 193 

By 

Name 

P. 



9815 



-65- 



APPENDIX III 



Tables and E:cuibits 



9815 



-66- 



I 

Table 1 

llurnber of companies selling in each Zone, zones 1-12 



Zone 


Resident 


lion-resident 


Total 




Producers 


: Producers 




1 


20 


: 17 


37 


2 


65 


52 


97 


3 


51 


29 


80 


4 


60 


32 


92 


5 


70 


55 


105 


6 


136 


23 


159 


7 


46 


14 


60 


8 


69 


27 


96 


9 


41 


21 


62 


10 


67 


17 


84 


11 


18 


6 


24 


12 


62 


7 


69 


Perceni 


;age 73$ : 


27/ 3 : 


lOO/o 



Prom the "Fertilizer Industry Zone List", 
National Fertilizer Association, Third 
Edition (March 12, 1935). 



9315 





01 Ilumber of schedules filed, zones 1-12 


Year 
& Zone 

Month 


rH 

cti 
+■• 



H 

OJ 

<H 

r-l 
r-l 

O 

H 

CP 
BO 

f- 
>x> 

.IT 

.=t 

CM 

rH 


* 


-67- 

tO LO O O l"^\ CM OX=f tO VO LO f- 

' H W r°lH CTiUD LO CTi rH O J" O 

O r-o to r^o ^O vn rouD J- r^vo 

rH rH 

C 


r— 

CM 

r- 








.zl" J" LO tO U) 1 — OrHUDrHUJCM 
r-OU) VX) rH rH ^t I s — VX> KMT 


O 
r- 






rH O 
rH 


C-MD^CMtsOLrAO-rl-^-rHCMCMr^ 
I^OrH rH rH rH 


U3 

rH 

H 


CTlO O O f~ 
rH rH 






VJD rH I^O CTMO OJ VO CM r-O CPiLOtO 
>vO^DLT\ CM rH .rt CM rH 
rH CM 


cr> 

CM 
M3 








Or— tO rH rHUJjHr (^[>- LO.Hr VX5 
LO.H/ rH rH rH rH CM 


CM 

O 

01 








V£> tO J" HMO inLHr--C\) M O 
W l^iOW v£> U) rOt>0 .rt LOvjO 

H rH 


0^ 

LO 

r-- 




00 
<D 

r-l 




K1.H- LO CT, H -rt" >sD »X) rH CO rH r*> 

(\1 I^H HH r^CVJPJ r^iH WH 


r-— 

CM 




n3 

EH 


J" LP 

1 — r*- 


C\JlTiHHHCr\tiOOCrinH 
J- ^IHD H H N r^ t-O ^ij" LO 
rH rH 
H 




J- r— cr>u3 rH 

tO U3^t 




lo to 

LOCM 


r^i caud to 1 — r~- O U3 rOJ- LO 

r— tO CM rH LO.£f C\J LTir^rfMT 


to 

O 

LT 


LOP- CM CT.CM 
J- CM CM CM 






VJD LO K> H LO r-^i" hOVJD tO rH LO 
O r— r— MD H W CM LfMTi(M O CT 
rH rH rH rH rH rH 


rH 

rH 

rH 








O J" to LP. r^VD *X> CP» tO CTi O tO 
CT> LO LO.J- r--Nh-U3M H N 
rH CM rH rH 


VD 

OJ 
rH 








i-o r>- r-ovn to to J- ^0 rH lo cnuD 

UD tO O CM 0\^t LO r-O J* r-J VD 
rH rH rH 










LO O tO r*~\ t*\=f rH tO LO J" rH LO 

1*^1 vja r*-\ i*-\ i<^h hct 

rH rH 


1*- 

u ■ 




Jg 




r-o > O 

CTi O ID 
rH ' h n 


1 ■& 

I^C^D fn p >, fj h yi p,.p > 
CPinJcDctfp. cSpjjrjcDOOQ) 

HbPqS^ShbflJcnorHfH 


0- 

rH 
rH 

rj 
-p 
O 
rH 


LO ... 

ro d rD U u t>-. 
<y> cd CD ci p, c3 



CD 
rij 

cm 



0) 

o 

o 

6 



-68- 



Footnote ; Table 2. ; 

The 1934 figures were compiled by the Association from its "Lists 
of Filed Price Schedules" (results reported in Senate Hearings, loc» cit. , 

note p.___ , page 1756). The 1933 and 1935 figures were compiled 

for the present study. Due to the impossibility of making the figures 
check with those, for 1934. (on accaunt of confusion between schedules and 
sup .dements, mistakes in serial numbers on schedules, creating of new 
subzones, etc.) and the labor involved, in counting and checking, cnly 
three zones' Were "tabulated out of the nine for which data were avail- 
able. . , 



9815 



-69- 



TA3LE 3 
Number of schedules filed by each company, zones 5, 6, 8B, 8C 



Number of 


Number of companies filing 


schedules 


Zone 5 


Zone 6 


Zone 3B 


Zone 8C : 


Total 


22 






1 : 




1 


21 : 








1 : 


1 


20 : 












19 






1 




1 


18 : 






1 


3 : 


4 


17 






2 




2 


16 






3 


1 


4 


15 




1 ! 


o < 


l : 


4 


14 


3 




1 


5 


9 


13 


2 


: 1 


4 


! 2 


: 9 


12 


1 3 


2 ! 


4 


: 2 


! 11 


11 


5 


4 


4 


2 


15 


1") 


6 


2 


2 


: l 


: 11 


9 


8 


10 


4 


: 1 


: 23 


8 


1 5 


: 10 


6 


! 4 


: 25 


7 


: 8 


14 


: 6 


: 2 


30 


6 


: 7 


. 14 


: 3 


! 1 


: 25 


5 


: 12 


: 23 


: 6 


: 5 


: 46 


4 


16 


: 28 


: 5 


: 4 


: 53 


3 


: 15 


: 25 


4 


: 4 


: 48 


2 


: 17 


: 24 


: 8 


: 3 


: 52 


1 


: 20 


: 22 


! 3 


: 2 


: 47 



Total companies 127 180 70 
Total schedules 652 840 574 



44 

380 



421 

2446 



Footnote: 

These totals are smaller than those in Table 2 for zones 
5 and 6, due to the omission in Table 3 of certain supplements 
to schedules which had been included in Table 2. The zone 8 
figures are Larger in Table 3, since many schedules filed to 
cover both subzones are here counted twice. 



9815 



-70- 



Table 4. . 
Humber of companies selling on- one and several zones 



humber 


of 


zones 


: Number of 


in which p 


rices 


companies 


were 


fil 


ed 




1 






: 521 : 


2 






82 ' 


3 






19 


4 






12 


5 






,3 = 


6 






5 


■ 7 









8 






3 


9 






2 


10 






5 


' 11 






' 2 ' 


12 






o 



Total 



656 



From the "Fertilizer Incus try 
Zones List," Loc. cit . , note p. 90, 



9815 



-71- 



Table 5 
Month of first bug. last filing, zones 5, o 



Year 


: Zone : 


Zone- 


6 


L 


: First 


: Lest : 


First 


: Last 


Month 


: filing 


: filing : 


filing 


: filing 


1933— 










~¥.vv. 


—52 


5 :• 


'■■- .66 


3 


Lee. 


22 


2 : 


21 


2 


1934- 










Jf n. 


19 ' 


1 : 


35 





Feb. 


6 ' 


3 : 


27 


2 


Mar, 


1 


1 : 


r, 


4 


Apr. 


: 


1 : 


1 


3 


May- 


2 ' 


: 


1 : 





June 


: 


1 :' 







July 





: 





l 


Aug. 





: 





o • 


Sep. : 





3 





1 


Oct. 


LL 


3 : 





2 


IIov. 


1 : 


7 : 


4 : 


i 


Dec. 


8 


14 :' 


6 


6 


1935- : 










Jan. : 


7 : 


26 :■ 


7 


8 


Feb. : 


3 : 


12 :' 


7 : 


18 


Mar. : 


1 : 


14 : 


1 : 


105 


Apr. : 


1 


31 : ; 


: 


17 


May : 


: 


3 


: 


2 



Humber of 
companies 
127 



127 



180 



18Q 



ilote: A reduction in iv.tra-state freight rates in 
Georgia on iierch 20, 1935, required the fil- 
ing of new schedules for -Zone 6. There were 
. ^actually only 49 schedules filed in ::arch 
which were not uiere repetitions (except for 
adjusting to the freight 'change) of previous 
schedules (see to.ble 2). : 



9815 



-72- 



Table 6 
Detail in price schedules, 1923, 1955 and 1955, zone 5 



Detail 


July 1928 


: September 1955 


: April 1955 




: (nui 


nber of typewritt 


en lines) 


Price Basis 


: 20 


: 7 


! ii 


Freight payment and LCL extra 


: 6 


5 


: 4 


Trucking allowance 




9 


: 24 


Credit terms 


41 


45- 


: 41 


Agents and dealers 


17 


: 11 


67 


Bag extras 


5 


; 5 


: 12 


Bulk discount 






5 


Tobacco goods and 








special materials 


11 


14 


15 


Warehousing 


5 • 


5 




Quantity discounts 






55 


Sales to government bodies 






15 


Special mixtures 






18 


Sales and delivery jeriod 






5 


Location of factories and : 








vr rehouses : 






4 


Statement of changes : 






one page 


Prices quoted : 


? 


22 items 


66 items 



Total lines 



Total pages 



105 



97 



270 



11 



The July 1928 schedule was examined at the Federal Trade Commission, which 
secured it in connection with its basing-point study made at that time. 
The number of -rices quoted was not taken doen at the time of examination. 



. i . . 



-73- 
Table 7 

Delays in meeting t>rice changes, zones 5, 8C and 12B 

(All companies in each zone except ; Mississippi only in zone 8C) 
(Change to consumer basis involving price advance for some firms, 
decline for others, January 1, 1934) 





Z 


H E 5 








Days delay 


Number of 


Days de! 


Lay 


Number of 




coTrroanies 








conroanies 








29 




1 





3 




31 




5 


5 


1 




32 




4 


7 


1 




33 




2 


8 


3 




34 




1 


12 


2 




35 




- 7 


13 


1 




36 




5 


14 


4 




38 




1 


15 


3 




41 




3 


17 


5 




42 




3 


20 


2 




43 




7 


21 


10 




45 




2 


22 


2 




47 




5 


24 


2 




40 




1 


25 


2 




49 




■ 2 


26 


3 




50 




3 


27 


4 




52 




3 


28 


1 




Total 




104 




(Price advance, 


i Novemt 


ier 2, 


1934) 







9 




69 


/ 


3 


10 


2 




71 




2 


11 


1 




72 




1 


13 


1 




73 




1 


17 


3 




• 74 




2 


27 


2 




■ 76 




1 


23 


1 




79 




2 


29 


1 




81 




1 


32 


1 




83 




1 


34 


2 




84 




1 


35 


1 




85 




1 


36 


1 




87 




2 


38 


3 




88 




1 


41 


2 




90 




2 


42 


1 




93 




• 2 


43 


3 




98 






44 


. . 1 




99 




1 


45 


2 




101 




1 


46 


1 




108 




1. 


48 


4 




109 




2 


50 


1 




113 




1 


51 


' . 4 




118 




1 


52 


1 




119 




1 



9815 



9815 







-74- 








Table 7 








(Continued) 




(Pric? advance, November 2, 1934) continued 




56 


1 121 


1 




58' 


3 132 


1 




59: 


. 1 141 


1 




60 


2 






62 


3 Total 


95 




66 


1 








ZONE 8 C 




Date 


Number of conroanies Date 


Number of com-oanies 




quo tin-"' 
( Change 


on new basis 


quoting on new basis 




i from dealer to consumer 


basis, January 1, 1934) 


Jan. 1 




5 Mar . 1 


23 


13 




6 Avt. 1 


24 


15 




7 May 10 


25 


16 




8 




18 




9 




20 




10 




25 




11 




28 




12 




29 




13 




Feb. 1 




15 




8 




16 




13 




17 




15 




19 




19 




20 




22 




22 . 




(Price reduction from $31.25 to *30.85, grad 


e 4-8-4, June 30, 1934) 


June 30 




7 Aug. 2 


17 


July 7 




9 4 


18 


8 




10 11 


19 


12 




11 Oct. 25 


21 


15 




12 Nov. 22 


22 


22 




13 




24 




15 




28 




16 




(Price increase from *30.85 to $32.15, 


December 1, 1934) 


Dec. 1 




11 




10 




13 




13 




15 




16 




17 




(Pr 


ice reduct- 


Lon from *32.15 to *31.75, 


December 27, 1934) 


Dec. 27 




10 Jan. 14 


21 


20 




12 17 


22 


Jan. 5 




14 24 


23 


6 




17 26 


24 


10 




19 Feb. 21 


25 






Mar. 18 


27 






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28 



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-77- 

Tahle 9 

Price leaders, zones 1, 2, >i, 8B, 80 

Zone 1 



American Agricultural Chemical 133 

Olds and Whipple S 11 
Standard Wholesale Phosphate and 

Acid M 10 

Apothecaries Hall S 7 

Internation Fertilizers ? 7 

Consolidated Rendering V. 4 

International Agriculture B 3 

Higgins Fertilizer S 2" 

Callnan Bros. S 2 

3a stern States Farmers L - 1 

Summe'rs Fertilizer M 1 

Miller Fertilzer (*) S ' . 1 

Canada Packers ? 1 

Berkshire Chemical (*) S _1_ 

Total 134 



(*) Controlled "by Davison Chemical 



9815 



-73- 

Table 9 
(Continued) 

Zone 2 



American Agricultural Chemical 

Baugh n.nd Sons 

Standard Wholesale Phosphate and 

Acid 
Ober and Sons, G-. 
Summers Fertilizer 
Miller Fertilizer (*) 
Cooperative 0. L. F. 
Roys tor Guana, F. S. 
Farmers Fer ilizer and Feed 
York Chemical 
Berkshire Chemical (*) 
Virginia - Carolina Chemical 
Shippingburg Fertilizer 
Tunnel 1, F. W. 
Central Chemical (*) 
Long Island Produce and Fertilizer 
Lord Fertilizer, F. E, 
Reindollar 
Reed and Perrine 
Bennett and Foreman 
Rooney and Fly 
Chamberlin and Barclay 
Consolidated Pondering 
Armour Fertilizer 

Total 



(*) Controlled by Davison Chemical 





3 


179 


A 


M 


172 


.11 


M 


20 




M 


16 




M 


12 






10 




M 


8 




B 


5 




S 


4 




. S 


4 




S 


3 




3 


3 




S 


2 




ivi 


2 




ivi 


1 


ser 


S 


1 




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1 




S 


1 




S 


1 




s 


1 




s 


1 




s 


1 




M 


1 




B 


1 



442 



9815 



-79- 

Table 9 
(Continued) 

Zone 5 



Roys tar Guana, F. S. 

Chilean Hit rate Sales 

International Agricultural 

Planters Fertilizer and Phosphate 

Virginia - Carolina Chemical 

Anderson Fertilizer 

Fpting Distributing 

Logan - Robinson Fertilizer 

Reliance Fertilizer 

Cber and Sons, G. 

Southern Cotton Oil 

American Agricultural Chemical 

Armour Fertilizer 

Catawba Fertilizer (*) 

Farmers Fertilizer and Storage 

Carolina Milling 

Carolina Oil Mill 

Ftiwan Fertilizer 

Merchants Fertilizer 

Pendleton Oil Mill 

Synthetic llitrogen Products 

Total 



B 


121 


Importer 


21 


B 


20 


M 


17 


B 


9 


M 


4 


S 


4 


S 


4 


M 


4 


M 


3 


M 


3 


B 


2 


B 


2 


S 


2 


S 


2 


? 


1 


? 


1 


i.: 


1 


M 


1 


S 


1 


? 


1 



224 



(*) Controlled by International Agricultural 



9815 



-80- 

Table 9 
(Continued) 

Zone 83 

Roys tor Guana, F. S. B 93 

Standard Chemical M 58 

Merchants Fertilizer and Phosphate M 34 

Alabama Warehouse ? 13 

Capital Fertilizer M 8 

Swift and Company Fertilizer E 5 

Virginia - Carolina Chemical B 5 

International Agricultural B 4 

Home Guano M 4 

Wilson and Toomer Fertilizer M 3 

American Agricultural Chemical B 2 

Ware Brothers Agency S 2 

Roanoke Guano S ;2 
Synthetic Nitrogen Products Importer '1 

McMillan and Harrison Fertilizer S 1 

Nitrate Agencies M 1 

Southern Cotton Oil M 1 

Federal Chemical M 1 

(*) Several producers 13 

Total 256 



(*) More than one competitor specifically named 



9815 



-31- 

Table 9 
(Continued) 

Zone 8C 



Royster Guano, F. S. 
Virginia - Carolina Chemical 
American Agricultural Chemical 
Newton Oil 

Swift and Company Fertilizer 
Alabama Chemical 
Meridian Fertilizer 
Laurel Oil and Fertilizer 
Ware Brothers Agency 
International Agricultural 
Davison - Pick Fertilizer 
Read Phosphate (*) 
Baugh and Sons 
Jackson Fertilizer 
Standard Chemical 
Federal Chemical 



Total . 142 



b 


79 


B 


26 


B 


8 


S 


8 


B 


5 


? 


3 


l: 


2 


s 


2 


s 


2 


B 


1 


M 


1 


U 


1 


;. 


1 


i.; •■ 


1 


? 


1 


i: 


1 



(*) Controlled by Davison Chemical, 



9815 



-82- 



5126 



cl 


Kh 


.-. 


bd 










p 


tr] 


CD 


H- 


o 






1 


1 


p 


Oj 


0*1 


o 






b 


H 


H- 




3 en 






o 


H 


d 




y o K 






H3 3 

o p 




3 




03 Hj N 
<3 <" 






c+ 










^ 






& 


























o 
















o 
















3 g! 






H 










t £ 






03 


T. 


oa 


^4 




mber 

of 

anie 






O 


o 


•P" 


IX) 


-p" 
















N 














CO 


CD 
O 

o 
































o 














tei 


1-3 


>§ 




CO. 


ro 


OJ 


M 






O 


>d 




4=r 


nj 


U3 


~J 


p" 


p 


cl- 


S 




O 


_>~j 


m 


<JT 


m 


CD 


p. 

H) 

h- as 
H O 
CD P 
Pj CD 

Oj 


3 

H- 
CD 

CO 

CD 
CD 
c+- 
















& 














hj 


H 


H- 














CD 


CD 


b 


1-3 












i-J 


CD 


0*3 


?L 










H 








a 1 


-FT 


yjj 


■P 


on 


I- 1 


o 




O 


i- 1 


• 


• 




• 


• 


o 




O 


CD 


-J 


-^J 


--4 


vji 


on 


1 

e 
1 




3 

►d 

CD 
c+ 

c+ 

O 

3 


O 




























g! 


C/3 


- 






rv> 


CT> 


-p- 


OJ 


pi 

3 


& 


N 




-p" 


^j 


H 


Ol 


IX 


CD 


e dales f 
Total 


O 
CD 
CTv 














hd 
















CD 


H- 






H 




H 


V_nI 


G^. 


4 


H 






JD 


<o 


VJ1 


oa 


V.O 


o 


CD 






• 


m 


• 


• 


■ 


CD 


pJ 






Ol 


-j 


Ul 




G^ 


3 


ci- 
O 

3 

CD 


















c+ 


















1-3 
















B 5 


O O 
O O 






£ 


H 

M 


ro 


H 

IX 


O 


CD 


mpetiti 

late t 
































hd 


o o 
















CD 


3 






ix 


P" 


V_nI 


rx 




hi 


c3 






<T» 


-~i 


p" 


ui 


O 


o 


CD 






• 


• 


• 






CD 


CD 






OJ 


OJ 


P" 








ct 







-33- 
Table 11 
Delays in meeting competition within waiting period, zone 5 



iTumber of companies stating that they net 

competition of price leader on schedules 

filed January 26 and June 20, 1934 



Days delay after 


: Date of 


: • Date of 


schedule of price 


: I: riling : 


: filing (receipt) 


leader was filed 






r> 


1 


: . ' 


1 


1 • 


: ■ 


2 


1 


: 1 


3 


1 


: ■ 


'4 


2 • 


: 1 


5 


6 


3 


6 


. 


1 


7 


8 


4 


3 





8* 


9 








10 





2 


11 


1 





12 


0- 


1 


13 : 





2 


Total number of 






companies 


23 


23 



(*) Six of these 8 schedules arrived .too late to be 

effective the sane day as the price leader, as did 
all of the schedules received on succeeding days. 



9815 



-84- 

Table 12 

Price indexes, fertilizer, materials 

and other products, 1933-1935 

(3-8-3 in dollars per ton; other series changed from 

original indexes to nal-e 1929=100) 







Whole sal 


2 price 






Indexes < 


Df prices 




inde: 


ces 






-paid by 


farmers 




: Mixed 


fertilizers 


: 5-8-5 










Year 






: South 


: All 


: Ferti- 


: Fertili- 


: All 


and 






:Atlantic 


: finished 


: lizer 


: zer and 


: goods 


month 






: States 


: -oroducts 


: materials 


: materials 


: bought 


1933 


= 1/ 


:2/ 


:2/ 


w 


:2/ 


:5/ 


:3/ 


Jan. 


: 64.8 


: 64.5 


:$14.25 


: 70.6 


: 67.6 


: - 


: - 


Feb. 


: 64.6 


: 64.2 


: 14.25 


: 69.5 


: 66.8 


: 


: 


Mar . 


: 62.0 


: 61.8 : 


14.25 


65.7 


67.2 


69.7 


: 65.8 


Apr. : 


61.9 ■ 


61.7 : 


14.25 


65.7 


68.3 


- 


- 


May 


65.4 


64.9 : 


14.25 


• 71.1 : 


74.7 


- 


- 


June ; 


65.2 : 


64. 8 : 


14.25 


73.0 


73.8 


: 


62.8 


July : 


65.4 : 


65. 1 : 


14.25 


76.4 


74.5 


- 


- 


Aug. : 


66.3 ■ 


66.2 : 


14.25 


77.7 


74.9 


' 


- 


Sept. : 


69.6 • 


69.7 : 


16.00 


79.2 


72.3 


75.9 


76.3 


Oct. : 


70.2 


70.5 


15.25 


79.8 


73.4 


- 


- 


Nov. ; 


70.3 


70.5 


15.25 


79.6 


73.6 


: 


- 


Dec. : 


72.2 


71.9 


16.75 


79.2 


73.9 


78.2 


76.3 


1934- ; 
















Jan. ; 


75.9 : 


73.2 : 


17.58 


80.4 


74.3 


- 


- 


Feb. 


75.2 


74.6 : 


17.58 


: 81.5 


75.1 


- 


- 


Mar . 


75.5 


7.4.7 : 


17.25 


81.7 


75.5 


' 79.5 


78.9 


Apr. : 


75.5 


74.8 


17.25 


81.6 


74.6 


- 


- 


May « 


76.0 


75.3 


17.25 


: 82.3 


72.1 


: - 


: - 


June : 


76.5 


75.5 ; 


17.25 


82.8 


73.7 


: _ 


79.6 


July 


75.5 


74.9 - 


17.25 


78.2 


73.4 


' - 


- 


Aug. ; 


75.7 


75.1 


17.25 


83.8 


70.4 


: — 


' — 


Sept. 


74.0 


75.1 


17.25 


84.8 


72.1 


80.6 


82.9 


Oct. . : 


74.0 


75.1 


17.25 


83.8 


71.3 


! _ 


: - 


Nov. 


74.4 


75.6 


17.25 


83.9 


70.1 


- 


— 


Dec. 


76.5 


75.8 


18.15 


84.1 


70.9 


— 


82.9 


1935- 
















Jan. 


75.9 


75.4 


18.15 


85.5 


72.2 


— 


— 


Feb. 


75.5 


74.9 


13.15 


86.2 


71.9 


— 


- 


Mar. 


75.5 


74.9 


18.15 


86.5 : 


72.0 


81.2 


88.6 


Apr. 


75.4 


75.0 


18.15 


87.1 


71.7 


— 


— 


May 


75.7 


75.2 


18.15 


87.2 


71.6 


— 


— 


June 


71.1 


76.6 


18.15 


87.0 


71.3 


— 


38.6 


July 


70.3 


70.6 


15.75 


86.8 


71.3 


_ 


— 


Aug. 


70.4 


70.1 


15.75 


87.8 


72.5 


— 


— 


Sept. 


70.2 


69.8 


15.73 


87.9 


73.0 


75.9 


80.9 


Oct. 


70.5 


69.9 


15.73 


87.5 


73.0 


— 


— 


Nov. : 


70.0 


69.5 


15.73 


87.5 


73.3 


— 


— 


Dec. 


70.1 


69.7 


15.73 : 


87.9 : 


70.0 


— 


80.3 


Percent increase 














March 1935 to : 














March 1935 21.8 


21.2 


27.4 : 


24. 3 : 


7.1 


16.5 


27.0 


Sept. 1933 to 














May 1955 8.8 : 


7.9 : 


13.4 ! 


10.2 : 


1.0* : 


7.0 : 


6.0 



1/ National Ferti 
2/ Bureau of Labo 



lizcr Association, 
r Statistics. 



3/ Ikireau of Agricultural Economic! 
* Decrease 



nm r 



-35- 
Table 13 

Fertilizer costs one', net receipts to producer, 1933-1934 

(dollars per ton) 



Detail 1233 1934 Increase Per cent 

increase 



3.77 


11.02 


1.25 


13 


.88 


1.33 


.45 


51 


.61 


• .jO 


.32 


52 



Cost at plant: 
Liate rials 
Begs 

la; >r: mixing, shipping, etc. 
Tax tags; light, power, 

fuel, taxes; depreciation 

at income tax' rates; office ; 

sales and administrative 

expense; bad debts; insur- : 

ance; etc.. 4.24 4.40 .16 _4 

Total cost at plant 15.50 17. G8 2.19 14 

Actual net cash (dealer) price 
received by manufacturer at 
plant 15. PG 18.68 4.70 34 

Profit 1.52* 1.00 2.52 



Five States 



Retail ,/!/ /3/ [Zj_ M/ /5 / 

I 1 933 1934 1235 .1954 1933 1934 1955 1954 1935 1934 

Net cash .17.85 23.89:12.81 13.02 12.52 17.44 13.43 13.55 20.77 24.21 
price received 
Cost (ex- 
cluding in- 
terest on 
investment) . 19. 7u 24.34 13.84 17.08 14.60 16.25 15.80 17.40 21.83 23.00 

Profit 1.65* .45* 1.03* .94 ^ 2.01* 1.19 2.37* 1.15 1.06 * 1.21 

Percent increase in 



price 



.34 41 33 38 16 



1/ Eastern Shore, Virginia. (5-6-5 ) 

2/ llorth Carolina. (3-8-3) 

3/ South Carolina (3-8-5) 

4/ Georgia (3-9-3) 

5/ Indiana (2-12-6) 

This table is based on a cost survey made by the Association, covering a 
large number of companies. The general results were published in 10 The 
Fert il izer Review 6 (January- February, 1935). Those for the five States 
given here were reported in 1-TPA. files, Fertilizer Code, Division of Review 
Work Sheets. Since the reports were made as of Larch 1, 1334 (February 3 
in the case of Virginia), and one year earlier, the 1934 costs and profits 
were "anticipated." 
9R15 



-36- 



Table 14 



Consumer's list and cash. prices, .3-8-3 and 4-8-4, Zones 3, SB, 8C 
(based on price schedules of a leading company) 



1933: 



1934: 



Date price was 


: 3 - 


3 


- 3 


4 - 8 - 


- 4 


effective 


: List 


I 


Cash 


: List : 


Cash 


Zone 5 



Nov. 15 
Dec. 1 

Jan . 1 
July 26 
Nov. -2 



Percent increase 



£34.69 


.120 . 99 


$2?. 45 


$23.33 


26.35 


22.05 


29.35 


24.95 


25 . 85 


21.71 


28.45 


23.90 


24.95 


20.96 


27.50 


23.10 


26.70 


23.23 


29.30 


25.49 


8.136 


10. 7% 


6.738 


9.7$ 



Zone 8B 



1933: 


Nov . 


.15 


29.15 


24.78 


30 . 25 


25.71 




Dec. 


2 


51.20 


26. 52 


32.75 


27.84 


1934: 


Jan. 


2 


30.15 


25 . 37 


31.25 


26.31 




Jan. 


30 


27.86 


25.37 


28 . 87 


26.27 




June 


30 


29.75 


24.99 


30.85 


25 . 94 




Oct. 


26 


30.40 


26.45 


32.15 


27 . 97 




Nov. 


15- 


27.78 


25.00 


29.39 


26.16 


1955: 


Jan. 


20 


26.55 


23.36 


28.12 


24.46 




Feb. 


16 


25.74 


22.65 


26.72 


23.25 




Liar . 


22 


28 . 58 • 


24.86 


29.64 


25.79 






Percent increa.se 


2.0/3* 


. 3/o 


2.030* 


. <3JO 



Zone 8C 



1933: 


Nov. 15 


29.15 


24.78 


30.25 


25.71 




Dec. 2 


31 . 95 


26 . 84 


33.50 . 


28.14 


1934: 


Jan. 2 ' 


30.15- 


ijO • kJI 


31 . 35 


26.50 




June 30 


29.75 


34.99 


30.85 


25.91 




Dec. 1 


30.40 


26.45 


32.15 


. 27.97 




Dec. 27 


30.00 


26.10 


31.75 


27.62 




Percent increase 


2.9:o 


5 . ■.: .• 


-5.0,9 


8 . 1 % 



Decrease. 



This table and each of those like it (Nos. 15, 25, 24 



26, 27, 55, 42, 46, 48, 49) is based on the schedules of one company 
chosen as typical. The principal deviations by other companies were 
in the 1955 schedules. The November 1955 schedules of this company 
were actually issued in September and were simply mailed in to the 
Association when the Code Was adopted. They thus represented pre-Code 
conditions, although they "were influenced by the expectation of the 
adoption of a code. In this table the 1953 schedules are for carload 
buyers (see Table 49 for less than carload extras), the 1934 and 1935 
schedules for all consumers. 



9815 



-87- 



Table 15 



Trend of list and cash prices to. "typical" buyers, 4-8-4, Zone 5 
(a company selling on consigner' s ba.sis throughout) 



(Less than carload consumer 


d 












Tirst 


Last ' 






Schedule 


Schedule 


C?.rload consumer's list "orice 






',27.45 


. $29.30 


Less than carload extra 






1.15 


- 


Less than carload consumer 1 , s list 


->rice 




28 . GO ' 


. 2S . 30 


Cash discount 






10,-i 


13,3 


Less than carload consumer's cash 


price 




25.86 


25.49 



(Agents handling 250-499 


ton 


= in a 


season 


) 




Agent's compensation on time sales 




10 








o% 


Agent' s compensation on time sales, if 














payment of consumer's notes -guaranteed 




10 I 








10,? 


Agent' s compensation on cash sales 




30- 


; 






is ; 


Agent's compensation through quantity 














discount. 




— 








U 



(Let recei~ 


D.ts of 


company 


) 




i'Tet receipt of company on time 


sales 




24.71 


27 . 54 


het receipt of company on time 


sales, 


with 






consumer' s note:- guaranteed 






24.71 


2G.08 


Net receipt of company en cash 


sales 




21 . 96 


23.73 



9815 



-38- 
TABLI 16 
Consumer's list and ec-sh trices, 4-C-4-, Zones 1-13 





List 


Cash 




List ; 


Cash 


















First :Last 




First 


Last 


First 


Last 




First 


Last 


Sched-Sched- 


Zone 


schedule 


schedule 


schedule 


schedule 


Zone 


schedule 


schedule 


ule 


ule 


1 A 


: 34.40 


55.55 


30.37 


30.57 


5 


27. S3 


39 . 30 


too • >~>o 


85.49 


1 3 


' 32.25 


33.55 


■A ■ V • « O 


39.86 












1 C 


' 53.25 


31 . 56 


28.38 


3' . 08 


6 


25.90 


23.05 


22 . 02 


24--.98 


1 D 


^-i- ■ c>0 


31 . 55 




38 . 05 






















7* 


26.75 


27.00 


35. 32 


35.85 


2 A 


25.36 


2-6 . 27 


22 . 82 


6 i.44 












2 3 


■ 25.3: 


20.60 


33.82 


5.74 


8A 


cl . bl 


30.80 


36.87 


36.00 


2 C 


25. 56 


23 . 35 : 


23.62 


3; .40 


33 


30.25 


25 . 64 


35.71 


■35.75 


3 D 


c --■ • - o 


27.50 


21 . 57 


55.75 


66 


50.55 


■ 31.75 


85.71 


: 37 . : 


3 A 


7.6.05 


29.95 : 


23.44 


: 56.65 


9 


31.60 : 


1-7 r~> r— f— 


68. 1-4 


■50.33 


3 3 


2-". 60 


26 . 10 


33.04 


25.2? 












3 C 


27.60 


23.35 : 


24. £'.4 


25.42 


103* 


3 . 25 


• 31 . 66 


2" . 03 


36 . 51 


3 D 


2' .55 


50.60 : 


26 . 06 


n 7 . 54 


100* 


6 6.25 


33.89 


8'- . 05 


8. 6 SO 


3 E 


30 . 07 




27.06 


nn ^ r-j 


10D* 


53.65 


■ 35.53 


39.39 


30.00 


3 7 


26.45 


23.95 ; 


23. CI 


"5.95 












3 G- 


26 . 4 - 


29.95 


25.81 


: 26.95 


11 




33.00 


31 . 50 


30.40 


3 H 


26.45 


- 3 95 


23.51 


' 36.95 






















13A* 


44.50 


48 . 80 


43.38 


4 . 05 


4 A 


2G . 07 


33.00 


23.85 


•28.38 


123 


65.3 00 


38.87 


35.3 6 


•7 O r " 


4 3 


2G . 07 


31.10 


23.65 


36.75 












4 C 


27 . 45 


51.10 




3 .75 












4 D 


27.45 


31..10 


i->r7 r- — 


36.75 













* Zone 7: 4-7-5, citrus braird; Zo;-e 10: 4-8-6; Zone 135: 8-9-6 

For the source of this and the next t ble, see note to table 6. Ihe 
first schedules cited in this tabl..- and in nurobers 17, 88, 35, 40, 45 and 
47, are tl osc filed in lTovember 1835, End although nan-'- of then arc dated 
in this month (rather than in September as in the case of She comair; ised 
as the basis for tabic 14), they nevertheless represent pre-code ccndi- 
ti Dns. 

.'he first schedules shov; rices to ccn s uners in carload lets, the 
last schedules in either carload or less than carload lots. 



9815 



-39- 



TABLS 17 



Di stributor 1 s list and cash prices, 4—8-4, zone 1-12 
(price to agents or dealers not receiving auantit' r discount) 



L i 



C v s h 





Zone : 


First ! 


Last : 


First 


Last 






Schedule : 


Schedule ; 


Schedule 


Schedule 




1A : 


$33.02 : 


$34.13 : 


$29 . 05 


$29 . 35 




13 


30.54, : 


31 . 87 


25.98 


28.36 




1C : 


30.54 : 


29 . 97 : 


25. 9C 


25.67 




ID 


30 . 54 : 


29 . 97 : 


25.98 


26.67 




2A : 


24.15 


25.70 


21 . 74 


23.13 




23 : 


24.15 : 


26.03 


21.74 


22.38 




2C : 


24.15 : 


25.71 


21.74 


23.48 




2D 


22.50 


24.75 


20.25 


21.73 




3A 


33.44 


27.45 


20 . 84 


24. 25 




33 : 


24.75 : 


24.71 


22.28 


22.48 




3C 


26.10 : 


27 . 00 


23.43 


23.43 




3D 


27 . 45 : 


28.15 


24.71 


24.79 




32 


28.57 : 


29.30 


25.71 


25 . 30 




3? 


24.95 : 


27 . 25 


22.45 


23.96 




3G 


24.95 


27.25 


22.46 


23.95 




3H 


24.: 5 


e 1 . do 


22.45 


23. 95 




4A 


24.10 


23.70 


21. SS 


: 26.15 




43 


.95 


27 . 99 


22.45 


25.19 




4C 


: 2<: . 40 


27.99 


21.95 


: 25 . 30 




4D 


24.95 


27.99 


22.45 


25 . 19 


5 


24 . 10 


23.03 


21.95 


25.73 


5 


24 . 40 


25 . 8o 


21.95 


: 23.21 


7* 


25.25 


24 . 84 


23. 99 


25 . 50 




8A 


29.75 


28.54 


: 25.78 


: 25,76 




33 


26.90 


27.17 


24.21 


25.64 




8C 


: 25.90 


23.57 


24 . 21 


: 2' ; .36 


9 


28.75 


so.:: 3 


dD .Ol' 


: 27 . 57 




10B* 


29.15 


CO • OO 


2G .234 


: 25.95 




IOC* 


: 29.15 


: 29.93 


25.24 


: 26.34 




10D* 


pq 'zq 


30.00 


26.15 


: 27 . 00 




11 


: 28.93 


27.00 


: 28.35 


: 25 . 55 




12A* 


: 40.50 


43.65 


38.48 


41 . 23 




123 


: 33.50 


: 34.75 


: 32.83 


: 33.01 


* 


Zone 7: 4-7-3 


; citrus brand; Zo; 


le 10: 4-8-6; Zo. 


ie 12A: 5-9-5 






See note to T 


?bles 8 and 16. T< 


-bios 14-17, 43 ; 


tk 3 . 45 cannot 


be com- 



pletely checked against each other, since agent's compensation is some- 
times figured on the time price and sometimes on the cash price, since 
different corroanies are used in these tables at different points depend- 
ing an the fullness of the files available, etc. Thus, 'Table 15 uses a 
company which quoted on a consumer basis throughout, as does Table 15 
where available (e.C-.-not in Zone 6), while Table 17 uses companies 
which originally quoted on a dealer- basis. 



9815 



-90- 

TA3LE 18 
Uniformity of list prices, 5-3-3, zone 5 



Lists filed after date at hepc of column and 
b e f.ore following date: 





I.Iar. 15 


Jan. 1 


July 25 


Nov. 2 




1933 


1934 


1934 


1934 


Usual price per ton 


$21.95 




$24.95 


$26.70 


Number auoting usual rprice 


34 


83 


31 


105 


Quoting higher prices 


5 


- 


- 


- 


Quotation on consumer not 










dealer basis 


4 


- 


- 


- 


Reason unknown. 


j. 


- 


- 


- 












Quoting lower "Drice 


10 


p 


1 


2 


Quotation on P.O. .3. not 










delivered basis 


3 


- 


- 


- 


Heason unknown 


p 




1 


2 



9815 



-91- 

TA3LE 19 . 

Uniformity of cash prices, 3-0-5, zone 4-C 

(net receipt to company on cash sales deducting agent's 

compensation, if any - 20 identical companies, including 

all quoting 3-8-5 in 1933 schedules) 



First schedules filed under code, 1953 only 



Price 


Number of 
companies 


Hernarks 


$24.30 


1 


no discounts for cash 
payment 


23.54 


1 




21.40 


1 


•cash -price only 


21.33 


16 ; 




19 . 50 


1 


cash \irice only, P. 0.3. 




f 


plant 



Last- schedules filed un-^er code 



24.05 



22.08 




cash only; agency compen- 
sation not strted in 
percentages 



9815 



-92- 



Table 20 



Uniformity of prices, 3-9-3, zone 6 
(all companies quoting 3-9-3) 



27oVQ 
27.15 





First schedules 


filed under C 


Dde, 1933 only 


List 


: Cash 


I Number of 


: Basis of 


: Effective 


Price 


: Price 


: companies 


: auotation 


: date of schedule 


$27.15 


$23 08 


: 1 


Consumers 




27.00 


2: , 68 


\ 1 


Consumers 




- 


2?-. 65 


: 3 


Consumers 




24.45 


22,00 


1 


Dealers 




24.15 


21.73 


2 


Consumers 




22.44 


20.40 


1 


Dealers : 


. 


22.65 


20.33 


34 ! 


Dealers ! 




- : 


19.50 : 


1 : 


Dealers 





27,70 


: 24.10 


: 3 


27.70 


23.55 


! 1 


- 


23.10 


: 1 


27.15 


23.03 


89 


23.54 


22.85 


1 


- 


22.85 


1 


! 


22.65 


1 


24.15 : 


21.73 


1 


22.65 : 


20.38 ; 


3 



Schedules in e ffect Mar ch 1, 1934 



23.82 
23.08 

22.85 

22.35 



Schedules 



133 
5 

1 
1 



Consumers 
Consumer:'; 
Consumers 
Consumers 
Consumers 
Consumers 
Consumers 
Consumers 
Dealers 



Jan. 1934 (2), Feb. • 1934 (l). 

Jan.. 1934. 

Feb. 1934. 

On and after Jan. 2, 1934. 

March 1, 1934. 

February 1934. 

November 1933. 

November 1933. 

Nov. 1953 (2). 



Jan. 1934 (l). 



n effect March 1 C J, 1935 
Consumers 
Consumers 



Consumers 
Consumers 



On and after Nov. 19, 1934. 
March, April, June, July, 

October 1934. 
March 1934. 
April 1934. 



9815 



-93- 



Table 21 



Uniformity of prices, first schedules filed, zones 8 C, 9 
(all companies quoting grades mentioned: 1933 schedules only) 



rTumber of 


List 


Customer 


Place 


Cash 


comoanies 


■orice 


ouoted 


ouoted 


disco' 1 jilt 




$29.15 


3-3-5, Zone 80 


Delivered 




2 


Consuner(*) 


100 


1 


' 28.60 


Consumer 


Delivered 


10$ 


11 


: 25.90 


Dealer 


Delivered 


lOfo 




• 35.40 


•4-8-5, Zone 9 


Delivered 




1 


Consumer 


10$ 


17 


! 33.40 


Consumer 


Delivered 


10$ 


1 


' 32.50 


Consumer 


F. 0.3 .plant 


10$ 


1 


26.48(**) 


Dealer 


Delivered 


— 



(*) Met price to agent; $26.23. 
(**) Cash orice (no time orice). 



9815 



-94- 

Table 31 

Ilxhibit 21 A' 

Schedules withdrawn, zones 4-C, 5 83, BC, 11 
(Classified by big, medium-sized and small companiee) 

Zone 4C 



An original schedule (3) filed September 10, 1934 to "be effective 
September 20 s was withdrawn by tolegran 1 September 17. The conpany 
stated in a letter : of confirmation dated September 17: "In filing 
these schedules it : was our intention in pricing ITitrate of • Soda, to 
meet competition of the Chilean' nitrate Sales Corporation.-' As we did 
not meet exactly their prices to the consumer,- we find we 1?ill be vio- 
lating our agency contract with ; then to make sales under this schedule 
of their product. •' We trill i: mediately file a new price schedule chang- 
ing our prices, terns and agency compensation on ITitrate of Soda to ex- 
actly meet Chilean' competition." 

On September 13 the promised new sche'dule ; was mailed differing 
from the withdrawn schedule only in the particulars mentioned above. 
This is, nitrate of soda and sulphate of ammonia prices "ere reduced 
approximately one dollar a ton to the consumer", while agent's compen- 
sation was reduced one dollar a ton on less than carload shipments of 
these articles only. 

Two schedules (3,?) filed to meet the above withdrawn schedule 
were declared ineffective as a result of- its withdrawal'. 

A schedule (?) filed April 10,1335, was declared ineffective when 
a competitor (li) telegraphed a protest to the effect that this schedule 
had not been filed "simultaneously" with it, pn& proved it by reference 
to an envelope postmarked April 12. The principal change in the inef- 
fective schedule was a price reduction of about si:; dollars, a ton on 
nitrate of soda and sulphate of ammonia, ilo other comoany had made 
such a cut. On Aoril 15 the schedule mentioned was declared ineffective 
and on April 18 the firm mailed in a new one, with the price cuts men- 
tioned averaging only four dollars. The further action of the compe- 
titor named is unknown, its schedules being unavailable. 






9815 



-95- 

Toble 21 
Exhibit 21 A 
..(Continued) 

Zone 5 



Date 
1934 



Size of 
Company 



Days delay 

before 
withdrawal 



Change 

in 

Schedule 



Reason 
for 
T7J thdra.nal 



Apr. 



May 



May 



Sept. 
Septl 

Nov. 



1935 

Mar. 



Apr. 



Aor. 



M 



M: sane co, 



4 other 
companies, 

2M, 2S 



7 other 
companies, 

33, 311. IS 

M 



M: sane co. 
as in April 
and May 1934 



Autonatic 



Automatic 



0. 



Reduction on 
nitrogen 

Reduction on 
nitrogen and 
2 riixed goods 

Reduction on 
nitrogen 



See Zone 40 

Sane as price 
leader 



Censral 
change 



Contained an 
additional 
grade and 
nade slight 
change in 
delivery terns 

Slight change 
in agent's 
condensation 
and delivery 
terns 

Sane as above 



? 



Ineffective 
due to uith- 
draual of 
above list- 
See Zone 4C 

Ineffective 

due to nithdra'-'al 

of above list 

Errors 



Errors 



Filed to neet 
another sched- 
ule but arrived 
too late to 
neet 

Errors 



9815 



-95- 
TABLE 21 

Exhibit 21A 
( Continued) 

Zone 8B 

15 schedules withdrawn, plus 7 made ineffective because the 
schedules they were to meet had been withdrawn. 

One company (?) withdrew on March 12, 1935 a schedule in- 
creasing cash discounts, reducing quantity discounts and trucking 
allowances, etc., with no definite trend in prices and terms. On 
March 16 it filed another schedule tc meet a competitor, without 
significant changes. 

Another company ( S) withdrew a schedule so as to make special 
E. 0. B. prices meeting the competition of a local cooperative company 
which had just cut prices. 

Another company (m) increased the price on a popular grade 
in one schedule and then had to withdraw it to meet the competition of 
a lower price by a competitor. 

Another company (B) in October 1934 Withdrew a price cut, 
but followed it soon with a still greater cut. 

Another company (i.l) withdrew 5 lists, each of which 
made various changes in terms of sale, but none of which made a signigicant 
change which would have favored the consumer. : 

Another company (m) withdrew 6 lists, without definite trend, 

TABLE 21 

Exhibit 21 A 
(Continued) 

: Zone 8C : 



One schedule was withdrawn and 12 therefore made ineffective in 
September 1934 (See Zone 4C). ' 

One schedule (M) was. withdrawn and 3 (B, B,B) therefore made 
ineffective (although the companies withdrew 2 of these without waiting 
for declaration of ineffectiveness) in April, 1935. These had all in- 
volved changes from a consumer to a dealer basis far 4 Mississippi coun- 
ties bordering on Northwest Alabama, where one company (S) w a s threatening 
to go on this basis, but evidently refrained ('or returned to a consumer 
basis after illegally selling on a dealer basis for a brief period). 

Another company (S) ] withdrew a schedule reducing prices before 
it was even listed, in December, 1934, but repeated the cut in its next 
schedule. It withdrew a later 'schedule because by error it failed to meet 

9815 



-97- 

a competitor's scale of quantity discounts to consumer's exactly (which 
was pointed out by the Association in reply) and replaced, it by the correct 
scale. 

Another company (l.l) withdrew a. schedule adding one grade, hat 
making no other changes. 

TABLE 21 

EXHIBIT 21 A 

(Continued) 

Zone 11 

Cne schedule ( s) which, reduced prices one dollar (2fo) on 
one item Sulphate of ammonia) was. withdrawn before listing. This 
schedule stated it was to meet the competition of a named competitor 
but the company, was informed by the Association that no such competitive 
schedule was on file. 



9315 



-93- 



Table 22 



Dealers' and consumers' list and cash orices, 
4-8-4, early schedules, zone 5 





: Co'.-ro B.r.y A 


: Company P 


: Companies 




: (dealer distri- 
: but ion on 


: (agency distri- 
: but ion through- 


: A and B 


Remarks 


: Tirst uniform 




: first list) 


: out ) 


[schedule, January 




:Pirst schedules, November 15. 1933 


1. 1934 


Dealer' s list 








"ari'ce (or pay- 








ment required 








from agent) 


$24.40 


$24.71 


^25.61 


Dealer's (or 








agent !-s) cash 








discount 


10$ 


10$** 


5<2*** 


Dealer' s (or 








agent's) cash 








price 


21.96 


21.96 


24.18 


Carload consumer's 








list price 


25.90 


27.45 


28.45 


Carload consumer' s 








cash discount 


10"J 


15<g 


16<2 


Carload consumer's 








cash price 


23.31 


23.33 


23.90 


Less than car 1 , tad : 








consumer's list 








price ; 


* 


28.60 


28.45 


Less than carload : 








consumer's cash : 








discount : 


* 


10<3 


16< 


Less than carload : 








consumer's cash : 








nrice : 




25.86 : 


23.90 



* 



optional rith dealer. 

10*o of consumer's time urice. 

the agent received 5 percent of the consumer's time -orice on time 

sales, 10 percent on time sales if he guaranteed the buyer's notes, 

and 15 -percent on cash sales - this could be called a 10 percent 

cash discount, but it actually amounted to a reduction in the agent's 

cash discount (for Company B). 



9815 



-99- 



?able 23 



Consumer's list trices of materials, ^ones 5, 83 
(a leading company) 





Z o 


n e 5 






Year 


16$ 


18$ 


20<3 




and 


, . . Super- . 


Nitrate of 


' Eaini't' 




month 


•nhospha.te 


Soc*a 1/ 


(notash) 




1933: Nov. 15 


$19.46 


$43. : 32 


&25.31 




Dec. 1 


20 . 55 


42.70 


25.65 




1934: Jan. 1 


21.20- 


42.40 


28.15 




Feb. 5 




• 42.78 


27.20 




June 30 




45. '65 


26.60 




July 26 


20.50' 


: 42.25 


25.00 




Sept. 29. 




41.07 






Nov. 2 


22.15 


: 39.65 


23.05 




Nov. 19 






22.20 




Percent decrease, 










Nov. 1933 to May 1935 


13.8-1 


8.51 


12.3-1 





Zone 



1933: Nov. 15 


*.21 . 20 


$42.50 


$26.90 


Dec. 2 


22.85 


53.05 


27. 20 


1934: Jan. 2 


23.20 


42.40 


28.15 


Jan. 30 


21.43 


40.08 


25.83 


Mar. 11 




40.17 


26.02 


Mar. 24 




41.34 


26.99 


June 30 


22.80 


45.65 


26.95 


July 7** 




44.70 




Sept. 29** 




41.67 




Oct. 26 


23.95 


41.40 


23.50 


Nov. 15 


21.89 


39.17 


21.48 


1935: Jan. 2u 


20.80 


36.72 


20.21 


Feb. 16 


19.31 






Mar. 22 


: 21.70 


41.40 


23.36 


Percent decrease, 








Nov. 1933 to Mav 1935 


2.41* 


2.1«8 


13.21 



L/ 100 lb. bags. 

* Increase. 



** 



Com-puted from dealer prices, 



9815 



-100- 

Table 24 

Theoretical derivation of "saving from home mixing, zone 5 

(a leading company) 



No vember 19. 1934. and after 



Remarks 


16$ Super- 


18$ Nitrate 


20<£ ■ 


Total 




■ohosTDhate 


of Soda * 


Kainit 




Sale nrice of material 










per ton 


• .*22.15 


$38'. 85 


' $22.20 




Cost of elements in 


• 


■ 






8-3-3 


■ 11.0.75 


6.475 


3.. 333 


$20.88 


Actual sale price ■ 








26.70 


Presumed "saving" to farr 


le'r by home 


mixing ** 




5.82 



Presumed saving to : farmer by home mixing' throughout code 









— • 


1933: 


Nov. 


15 


*4.22 




Dec. 


1 


4.92 


L934: 


Jan. 


1 


'■ 4.21 • 




Feb. 


5 


4.27 ' 




June 


30 


3.80 


- 


July 


26 


4.05 • 




Setbt. 


29 " 


4.24 - 




"ov. 


2 • 


5.69 




Nov. 


19 ' 


5.82 



* 200 lb. tjags. 

** Cost of labor must be deducted from this, 



9815 



- 101 - 
Table 25 
Extras on tobacco grades, zone 5 



Date after 


ITumber 




union schedule 


of 


Charge 


became effective 


comoanies 




1933: ITov. , Dec. 


1 


$2.55 - 2.85 




2 


2.20 




1 


1.85 




. 27 


1.65 




1 


1.50 




IS 


ITo Mention 


1934: Jan. 1 : 


54 


2.50 




1 


2.00 




17 


ITo mention 


Aug. 28 


30 


2.00 




1 


' I T o mention 


ITov. 2 


64 


2.50 




9 


: ITo mention 



9815 



-102- 
Table'26 

Special mix charges, zone 5 
(a loading company) . 













Date charge 


Mixing 
charge 


Charge -or unit of materials used 


was 


Amonia, : Phosphoric 


Potash 


adopted 


per ton 


: Acid 




1934: Jan. 1 


$1.50 


Actual cost 


Actual cost 


Actual cost 


Feb.. ."5 


- 


: $1.63 ' 


$ .71 


$ .92 


Pet). 24 


$1.50 or 1 
2.00 if : 
made to : 
[special : 

[order * : 


same 


same 


same 

* 


July 25: 


same : 


same 


.69 


.89 


So ot ,2 9' 


same : 


1.62 


same 


same* 


Nov.. 19: 


same : 


2.09 


.65 


.50 


• 






: 


• 



* This usually meant that the purchaser would demand "100 pounds of 
blood," for example ,: instead of merely "10' 1 pounds'- of organic nitro- 



gen," and for this greater explicitness 
charged. 



;h<- additional 50 cents was 



9815 






-103- 
Table 27 



Grade differentials, zone 5 
(a leading company) 





Da 


te different: 


Lai was adop 


ted: 


Grades 


. : T ov. 17 


! Jan. 1 


! July 26 


: Nov. 2 




; 1933 


: 1934 . 


1934 


1934 




; . Ami 


nonia 


I $27.05 • 




Price of 4-10-2 


, .$24.00 


: $28.00 


: $29.60 


Price of 2-10-2 


: ■ 20.85 


: 24.65 


! 23.80 ■ 


: 25.40 


Difference : 


: . 3.15 


: 3.35 


! 3.25 


! 4.20 


Difference per unit 










of ammonia 


: : 1.575 


: 1.625 


: 1.525 


: 2.10 


Compare charge per 










"unit for special 




: (Feb. 2 






mixes 




: 1.68) 


: 1.62 


: 2.09 




! Phosrjj 


icric acid 


: $27.05 




Price of 4-10-2 


, $24.00 


: $28.00 


: $29.60 


Price of 4-8-2 


32.60 


: 2S.60 : 


: • 25 .70 ■ 


! 28.30 


Difference 


! : 1.40 


: 1.40 . 


: 1.35 


! 1.30 


Difference -oer unit 










of phosphoric acid 


. 70 


! .70 


! .675 


! .65 


Compare: charge per 










unit for special 




! (Feb. 2 






mixes 




i .71) 


: .69 


! .65 




Pol 


tash : 






Price of 4-8-4 


$24.40 


: $28.45 


$27.50 


$29.30 


Price of 4-8-2 


22.60 


, 26 . 60 


25. 70 


28.30 


Difference , 


1.80 


1.S5 


1.80 


1.00 


Differeno ->er unit of! 










potash J 


.90 


.925 ; 


.90 


.50 


Compare: charge per ; 










unit for special ; 




(Feb. 2 ! 






mixes : 




.92) : 


.89 ! 


.50 



The 1933 list is on a dealer basis; the later lists on a customer 
basis. 



9815 



-104- 

Table 28 
Price "basing methods, zones 1-12 



Zone 


: First 


: Last 


; Zone 


: First 


: Last 




;• Schedule 


: Schedule 




: Schedule 


Schedule 


1A 


t> 




! 5 


' R 


: F 


IB 


*: r 


: F 








1C 


R 


i F 


\ 6 


' ,R 


! F 


ID 


R 


5' 














' 7 


F.O.B. 


'. F 


2A 


R 


R 








2B 


R 


F 


8A 


R 


F 


2C 


R 


R 


8B 


R 


F 


2D 


i 


F 


8C 


R 


F 


3A i 


F 


F 


9 


, R 


F 


3B ; 


F.O.B. 


F 








3C ■ 


F.O.B. 


F 


10B 


R 


F 


3D 


F.O.B. 


F 


IOC 


• R 


: F 


32 s 


R ; 


F 


10D 


R 


F 


3E ■ : 


R ' 


F 








3G : 


R ' , 


F 


11 


'F.O.B. 


F.O.B. 


3H • : 


R 


F 




: 










12A 


D 


D 


4A | 


H ■ 


F : 


12B ■ 


D 


D 


4B : 


R : 


F 








4C . : 


R : 


F : 








4D : 


R ; 


F : 









F.O.B; F.O.B. factory. 

F: Delivered to farm. 

R: Customer's railraod station. 

D: Delivered in crop district. 

See note to Tables 8 and 16. 



9815 



-105- 

TABL5 29 

Inter— state selling, Zone 5 
L ocation of plants selling into South Carolina 



Georgia 


: North Carolina 


Maryland 


Michigan 


Athens (l) 


: Charlotte (l) 


Baltimore (2) 


Dearborn (l) 


Atlanta (2) 


: Elizabeth City (l) 


$6.37 -7.33 ! 




33.15 -4. 10 


:Laurinburg (l) 






Augusta (3) 


:Maxton (l) 






..: 1.30-2. 85 


:Hew Bern (l) 






Savanah (8) 


: $3.20 -4.70 






ci2.20-3.45 


:Portsmouth (l) 
:Ealeigh (l) 
:Sanford (l) 
: Wilmington (5) 








: $2.35 - 4.10 

• 







Location of South Carolina plants selling outside the 
state and states in which they »soll 



.-Qestination 



Zone 6 (Georgia, Florida) 



Zone 7 { Jl o rj da) 



Zone 8A .(Tennessee) 



Zone 8B /Alabama, F lorid a). 



Zone 4C "(North "Carolina) 



Location 



Anderson (l) 
Char 1 estoh (3) 



_ Charleston (2) 

Charleston (l) 



Charleston (l) 



Zone 10 (Kentucky and States 
Northwe s t) 



Charleston(4) 
Clio (1) 
Columbia '■ (l) 
Dillon (l) 
Greenville (l) 
Hart svi lie (l) 
Kershaw (l) 
Lancaster (l) 
Marion (l) 
Spartanburg (l) 



Charleston (l) 



South Carolina, restatement: companies selling int« 

more than one zone 



Location 



Zones sold into 



Charleston 
Charle ston 
Charleston 



6,7 

4C, 5, 8A 

6, 7, 8B, 10 



This table is compiled from the "Fertilizer Industry Zone List," loc.cit. iti 
note p. 66 _ and from the price schedules. 



9815 



-lCD- 
Tat le 30 

Freight aLorbed by, nine Iar t -;e cor.np.nies, 1935 



f 








■ 






: Average freight 


C ompany 


: Territory 




: absorbed per 
: ton sold 


A 


: Virginia to G-eorgia 








: (highest freight ab so rot ion, 


?riy 






: destination) 




: $6.00 




: (?verage freight absorption, 


all 






destinations) 




: 2.3a 


• 


: (lowest freight absorption, 


any 






: destination) 




: 1.00 


B 


Connecticut 




t 3.75 


C 


Virginia to Georgia , • . • 








(average) 




3.00 




(average, Georgia only) 




3.50 " 


D : 


South Carolina. 




2.55 


E ' . 


A labarca and Georgia 




2.50 


F : 


'Tennessee 




2.50 


G : 


Georgia 




2.17 


H . : 


' Maine 




1.93 


I • 


Maryland (Sa stern Shore) 




1.50 



9815 



-107- 

Table 31 
Prices and freight ra.tes from Baltimore 
(Consumer's cash price, 4-8-4) 





Piice F.O.B 


Freightto 




: Lei i vered: 


: Price FOB 


: Delivered 


* 




Baltimore 


lone city 


Delivered 


: Competing: 


: Baltimore 


: competing 


SMill net 


Zone 


April! 1934 


in zone 


price 


: price : 


:Apriiy.935 


: price 


: receipt 


1-1 


: 18. 55 


8.50 


27.15 


29. 58 : 


: 52.00 d 


: 30.57 


: 23.40 


1-B 


18. 35 


4.80 


23.35 


30. 17 : 


: 30.20 d. 


38. 57 : 


21'. 40 


1-B 


18« <jl 


4. 60 


23.15 


28. 84 : 


: 28.40 d, 


28.08 : 


23. 80 


1-D 


18. 55 


4.20 


22. 75 


28. 84 : 


: 28. 4C d 


29.86 : 


24. 35 


2-A 


IS. 55 ■ 


5. C 


24. 55 i 


•18.75 £ : 


: 23.13311! 


' 25.13 D : 


18.13 


2-B 


18.55 ' 


3.80 


22.35 


24. 96 : 


: 25. 74dD. 


25.74 : 


21.94 


2-C 


19.55 ' 


3. 80 


23.35 


•19.37 # : 


: 22. 19 dD. 


22.19 D : 


18.39 


3-D 


24.50 'd-'-' 


' 2. 00 


22.50 i: 


•24. 18 : 


: 24. 75d 


24.75 : 


32. 75 


3-A 


23. 90 d 


2.90 : 


21.00 h 


■22. 82 : 


: 26.69 d 


26. 95 : 


23.79 


3-B 


1 Ci S r 


C 


19. 55 


■19.87 i : 


: 25.74*d! 


25. 74* : 


25.74 


3-C 


19. 55 


4.60 


24. 15 : 


19.87 i : 


: 26.42 d 


26.42 : 


21.82 


3-D 


19.55' 


4. 60 


24.15 ■ 


•19.87 f : 


: 27. 54' d 


27. 54 : 


22. 94 


3-B 


19.55 ' 


5. 60 


25. 15 ■ 


19.87 # : 


: 28.67 d 


28. 67 : 


23.07 


3-F 


19. 55 


2. 90 


22. 45 


19.37 i : 


; 26.95 d 


26. 95 : 


24.05 


3-G 


19.' 55' 


4. 5C 


24. 05 


19.37 # : 


: 26.95 d 


26.95 : 


22. 45 


4-C 


18.55' 


5. 65 


24. 20 


2o. 12 : 


: 26.75 d 


26.75 : 


21.00 


5 : 


17.70' 


6.37 ; 


24. C7 • , 


23. 94 : 


: 19.38 . 


25.' 37 


25.75 d 


6 


18.76 


7.C9 : 


25.85 


24. 44 : 


: 18.52 


25. 49 


25.61 d 


11 : 


- 


? : 


- 


- 


: 12. 50** 


20. 90** 


- 


12 


- 


24. 80 


- 


: 


: 20.75 . 


• 37.76 


45.55 d 


d- deli 

Tl_ "Don' 1 , 


vered -.-.rice 















f- F.O.B. Baltimore' (quoted by 

**- 18 percent superphosphate 
H- mill net receipt 



a comneting firm) 



Hote; The ccmirrirons made in this table are obviously too 
rough for analysis. To cite one example, the company 
usually ships within its own zone ( 3) oy truck and 
thus saves the high freight charges shorn. 



9815 



.—tOS- 
Table 32 



Trucking allowances, zones 1-12 
(Lnd of code oeriod: allowance for hauling away from factory 
in customer's truck: per ton) 

(See notes to tables 8 and 16) 



Zone 




Allowances 






1A 


■■ 1 PP. 








IB ; 


: . 50 'up to ■ miles 


; 51.00 up to 10 miles; 01 fre 


i.7;ht rate 




ft 


: to custom r ' s 


station thereafter. 






ic . 


: v • '-'0 up. to ,- miles 


; $1.00 up to 10 miles; CL freight rate 






: to customer ' : 


station thereafter. 






ID • 


: 5 . 50 up tc 3 miles 
: :■» miles; etc. 


• $ .75 up to 15 miles; $1.00 


up to 2 . 




2A 


: #75 up to ..- miles 


■ $£)25 rer mile .thereafter. 






2B 


: ',-> . 73 up to 5 miles 


5(325 per mile to •■■ ,. miles; $015 per 






: : mile over 50 miles. 






2C 


: $ «75 up to 5 miles 


$,025 p r mile thereafter. 






2D 


$ .75 up to 5 miles 


5.02:3 per ..die thereafter. 






3A : 


5 . 75 up to i i males 


5,51.25 per mile thereafter. 






33 


, . 75 up to 5 miles 


$.025 per mile thereafter. 






3C 


3 . 75 un to _. miles 


3.025 per mile thereafter. 






3D 


$ .7:5 up to 5 miles 


3,025 per mile thereafter. 






32 


: $ . 75 up .to 5 miles 


$,025 jer mile thereafter. 






3? 


. 7 ; 5 up .to 5 miles 


S, 025 per mile thereafter. 






3G : 


$ .7.5 up .to 5 miles 


$,0:25 per mile thereafter. 






311 ; 


3 .75 up to 5 miles 


3,025 per mile thereafter. 


up to 55 




4A • 


$ . 75' up ,to 15 miles 


s; $1.00 up to 25 miles.; 51.25 




: 


miles; etc. 








43 : 


'•., .75 up to 13 ■railer 
mil.es; etc 


.; $1.00 up to 25 miles; 51.23 


up to 57 




4C ; 


$ .7/5 up to 15 mile: 
; miles; etc. 


,; $1.00 up to 2 miles; 51.35 


up to 35 




4D : • 


3 .75 up to 15 miles; $1.00 up to 25 miles; 51.25 


up to 35 




: 


: miles; etc. 








5 : 


: .75 up to 15 mile 
: miles'; etc. 


; $1.00 up to 3.'. .riles; si. 23 


up to 53 




6 : 


5 . 7-5 up to 13 mile 
: mil.es; etc. 


; $1.-00 up to 2? miles; 51.25 


up to 35 




7 : 


51.00 up to 2 .'; jiiiler 
miles; CL frei 


; $1.-2l up to 35 miles; 51.50 
rlit rate thereafter. 


up to 40 




8A : 


$ .75 up to 10 mile:; 
■ miles; etc. 


; $1.10 up to It miles; 51.30 


up to 20 




S3 : 


-,>. 75 








8C : 


.75 up to 15 miles; 


,:1.00 up to 25 miles; 51.25 up to 35 






miles; etc. 








9 ; 


3. 75 


103 : 


$. 50 








IOC : 


.50 








103 : 


5.50 








11 : 


Hone 


12A : 


hone 








12B : 


51.00 up to 2.. mile- 


; 1.50 up to $2.50 above 25 miles in 




• 


certain locali 


ties. 







9815 



-109- 



Table 33 

Trucking allov/ances rnd freight rates, zone 5 
(trucking allowances in effect after January 1, 1934) 



: igaway 


i j 


*ucl:in£ 


mileage 


Allowance 




per ton 


1-5 


r 1 - 


.75 


15-25 




l.'OO 


25-35 




1.35 


35-50 




1.50 


5Q-75 




1.75 


75-1 « 




2.00 


100-135 




2.25 


125-150 




2.50 


150-175 




2.75 


175 and over 




3.00 



A" iroximate L.C.L. freight r?,te 
■oer ton (on railwry pileage) 



$1.30 


- 


Si. 45 


1.45 


- 


1.65 


1 . 65 


- 


1.80 


] .80 


- 


2.15 


2.15 


- 


2.60 


2.60 


- 


2.95 


2.95 


- 


3.30 


3.30 


- 


3.60 


5.60 


- 


5.95 



1.95 and over 



9515 



-110- 



table 34 



Comparative consumer's list prices, 3-8-3, 
zones 4B, 4C, 5, 6, 8A 
(a leading company) 



Date price 


: Zone 43 


• Zone 40 


Zone 5 


: Zone 6 


Zone 8A 


occo.rae 


: Virginia 


: Tor tli 


: South 


: Georgia 


Tennessee 


effective 




Carolina 


Carolina 






1933,]!ov.l5 


- $24.00* 


$23.45* 


$23.45* 


: $23.45* 


$26.60 


1934, Jan. 1 


27.55 


26.90 


_ 


i 


M 


Jan. 2 


- 


— 


- 


26.45 


- 


Jan. 13 


- 


- 


25.85 


> _ 


- 


, Peb . £ 


- 


- 


— 


• — 


27.90 


Mar. 8 


26.90 


— 


— 


_ 


_ 


July 26. 


26.00 


26.00 : 


24.95 


: - 


- 


July 27 


- 


- 


_ 


_ 


27.59 


Ho v. 2 : 


- 


_ 


26 . 70 


- ; : 


- 


3fcv.l9 : 


•28.05 •; 


26.05 


- 


27.05 


- 


Dec. 31 : 


' •: 


- 


- 


. - 


27.61 


1936, Mir. 20: 


- 


: 


: 


26.45 ; 


- 



* Commuted fro:; dealer's prices "by 
to consumers, hence coanarable vitl 
direct. 



adding the • $1.50, mark-up on direct sales 
later prices only for consumers buying 



These are the only zones and sub zones for which quotations by this com- 
pa:.y on 5-0-3 were available to the study for the whole Code period. The 
company is not the one mentioned in the note to Table 14. 



981 



.-Ill- 
Table 35 



Inter-zone urice changes 
(including all zones ■oartici'oating in the changes) 



January 1, 1934 
(•pr ice adjustment s inv o lved in change from dealer to arent) 



Date 



Z ones changing 



January 1 

in 



4 ' 5 « 6 « 

2, ti, 9 



June 30, 1934 
(•prii-e reducti on, due to d eel ine__in -potash market) 



June 30, 
July 2 
July 25 
August 2 



November 2 

Ncvem er 19 

December 1 

Dec^'i\ n ; n r 11 

December 17 

Decoder 29 

Decer.bcr CO 

December 31 



4 

2, 3 
5 
9 • 



I'ov-mber 2, 1934 
(t>ric ^ adva nce) 



5 

A 
- i 

6 
2 
1 
3 
9 
8A 



Servra/e movements 



January 18 2, 3 
February 5, 22, 1934 
and 



Various dates 



10, 11 and 12 



These dates are not exact, -e.g. the trice decline of June 30, 1934, began 
in Zone 43 on that date, but did not st>read to the other sub zones in Zone 
4 until ...ulv 2, and 26. 



9315 



.-112- 
Table 36 

Number of .grades emoted, zones 1-12 





First 


schedule 


Last 


Schedule 




First 


schedule 


Last scnedule 


Zone 


in sub sons 


.line 
Date" 


er Code 
Grades 


Zon 


3 in 


sub z one 


und< 
Date 
1935 


;r Code 




Date 


Grades 


Date 
1953 


Grades 


Grades 




1934 




1935 








1A 


Jan. 


71 


Mar. 


95 


5 


Nov. 


56 


Mar . 


71 


IB 


Jan. 


73 


Mar. 


99 












1C 


Jan. 


74 


Feb. 


113 


6 


Nov. 


65 


war'. 


70 


ID 


Jan. 


77 


Mar. 


129' 






















7 


Nov. 


64 


Mar. 


67 


2A 


Jan. 


65 


Aor. 


118 




1934 




1934 




2B 


Jan. 


40 


Mar . 


111 


8A 


Feb. 


62 


Dec. 


67 


2C 


Jan. 


64 


Ar-r. 


101 








1935 




2D 


Jan. 


56 


Mar. 


126 


8B 


Feb. 


33 


Mar . 


55 












8C 


Feb. 


35 


A-or. 


34 


3A 


Jan. 


64 


Mar . 


125 












3B 


Jan. 


50 


Mar. 


80 




1933 








3C 


Jan. 


64 


Mar . 


91 


9 


Nov. 


33 


Jan. 


32 


3D 


Jan. 


64 


Mar. 
1934 


76 




1934 








3E 


Jan. 


64 


Dec. 


75 


10B 


Feb. 


76 


Jan. 


68 








1935 




IOC 


Feb. 


52 


Jan. 


62 


3F 


Jan. 


82 


Mar. 


117 


10D 


Feb. 


66 


Mar. 


72 


3G 


Jan. 


68 


Mar. 


114 












3H 


Jan. 


69 


Mar, 


121 




1933 














1934 




11 


Nov. 


21 


May- 


24 


4A 


Feb. 


27 


Nov. 


27 












4B 


Feb. 


67 


Nov. 


53 


12A 


■ Nov. 


55 


May 


40 








1935 




12B 


Nov. 


43 


A-or. 


54 


4G 


Feb. 


69 


A-or. 
1934 


77 

























Average (mean) 59 80 

4D Feb. 56 Dec. 76 



Note: See note to table 3. The dates of the first schedules 
are- for the first apolying specifically to the sub- 
zones. Table 37 uses the first .schedules for the 
States later included in the named subzones. 



9815 



-113- 
Tablc 57 

I T umber of grades quoted, zones 4C, 5, 6, 8, 9 
(based on -orice schedules of s£me connany as Table 36) 







Schedules effective or 


Zone an '. : 




bocomi; 


v.: effective i: 


i: 


Class of Goods : 


ITov. : 


Apr. 


: July ! 


Nov. 


Aor. 




1932 : 


1934 


: 1934 


1954 


1935 


Zone 4C (I'orth Carolina)* 












Mixed goods and superphosphate 


30 : 


57 


: 58 


53 


55 


Materials 






: 9 
: 67 


19 
72 




Total ; 


38 


79 


77 


Separate Analyses: mired goods 


27 


36 


: 52 


32 


29 


Zone 5 (South Carolina) 












Mixed ■ o ds and suoerrhosnhate 


42 


30 


: 34 


50 


52 


Materials 


14 


16 


: 20 


17 


19 


Total 


5C 


46 


: 54 


> 67 


71 


Zone 6 (Georgia) 












Mixed goods and suoer"">hos"Dhate 


55 


38 


: 41 


: 41 


- 45 


Materials 


10 
bo 


19 
57 


: 23 


- 23 

: 64 


- 15 


Total 


: 64 


: 60 


Zone SA (To..: -csscc) 












Mixed oo&s and su ciahoa4iate 


• 28 


> 54 


: 56 


: 48 


• 57 


Me.terials 


8 


6 . 


: 12 


: 12 


: 10 


Total 


: 36 


- 62 


: 68 


: 60 


: 67 


Zone 3B (Alabama,) 












Mixed goods and suarr -hosnhatc 


1— f- 


• 39 


: 31 


: 30 


■ 46 


Liateri als 


: 8 
: 41 


: 10 . 
49 


: 14 
: 45 


: 11 
: 41 


9 


Total 


■ 55 


Zone CC (Mississippi)* 












Mixed goods rnd sunei-ihosphate 


> 32 


23 


: 19 


: 21 


10 


Materials 


> 12 


■ 12 


: 13 


■ 14 


_16 


Total 


: 34 


r /R 


• [7*3 


■ 35 


- 34 


Zone 9 (Arkansas)* 












Mixec ™oods rnd sun ei—>ho senate 


■ or> : 


19 


: 19 


: 22 


' 23 


Materials 


: 11 
! 3i 


' .J--2 
■ 31 


1 ° 


' _9 
■ 51 


9 


Total 


; 31 


: 32 



*I~RA grade 'eduction eff :ctivc in those states in 1955. The April 1935 schedules 
in ever;- state in which grade reductions were in effect quoted all of the grades 
permitted; since the company wanted to be ready to sell each such grade, 
(without being bound by a waiting period) if an order should come in. Thus 29 
analyses were permitted in "forth Carolina; l r j in Mississippi and 17 in Arkansas. 
The extra grades sold by this company in April 1955 were either (l) different 
make-ups of the permitted analyses as Tobacco grades, (2.) "top dressings" a 
high-nitrogen group which was exempted in Forth Carolina, or (3) super?*! 
pllDspiia.t-es-.pwhich were always exempted. 



931, 



-114- 



Table 38 



Humber of : ra4es quoted, Zone 5 
(companies filing schedules 
to be effective on or soon 
after February 24, 1934) 



2 
1 
1 
1 
1 
2 
1 
1 











ITumb er 


of : 


: : Humber of 


mixed goods, superphosphates, 


conr-jan 


LCS 


: a 


ad materials auoted 






: . 3i£ 


producers 


1 






49 


1 






46 


1 






40 


2 






33 


medium 






40 






■ Kedium-sizcd "producers 


1 






92 


1 






78 


1 






S3 


: 1 






62 


: 1 






61 


1 






57 


2 




: 


56 


1 






50 


1 






47 


1 






46 


1 






44 


1 






39 


2 






38 


5 






36 


1 






32 


1 






30 


medium 




: 


45 



Small -.producers 

53 
52 
50 
49 
48 
45 
44 
43 



9815 



-115- 

Table 38 
(Continued) 



1 

1 
Median 



Number of 


Number of mired goods, superphosphates, 


companies 


and materials auoted 




Small producers 


2 


42 


5 


41 


1 


39 


8 


38 


3 


37 


2 


36 


2 


33 


1 


31 


1 


29 


1 


28 


2 


24 


2 


23 


2 


22 


1 


19 


1 


: 10 


1 


: 9 



o 

4 

38 



9815 



-116- 



TA3LE 39 



Changes in price schedules, March 1-7, 1935, ".one 5 









'Date in 


To meet 




'/um- 


: Dat 


e 


: March 


compe- 


: Change 


ber 


: filed 


: effective 


tition 




1. 


Feb. 


19 


1 


,r e s 


: general change in prices and terns 

(initiated by other convoanies in Fov- 
ember 1934) 


2. 


Feb. 


20 


2 


— 


4 additional -nixes;' 2 additional mater- 
: ials 


3. 


■Feb. 


23 


o 


To. 2 


2 additional mixes 


4. 


Feb. 


21 


3 


« 


a. all tobacco grades, 1 material dropped 

b. 2 prices corrected upward 20 cents a 
: ton 

c. proviso added that specially mixed 
grades shall never cost less tnan 
similar grades on the regular list 

d. agent's compensation on nitrate of 
soda and sulphate of amonia reduced 
$1 on LCL shipments 


5. 


Feb. 


23 


5 




a. 1 additional mix 

b. trucking allowance provision changed 
from "''ill jay" to "not more than" (in 
violation of tho Crc'e Authority Regu- 
lations) 


6. 


Feb. 


23 


5 


- 


an original schedule 


7. 


Feb . 


23 


5 




a. 2 additional mixes 

b. consumer's discounts en nitrate of 
soda applied to grade 0-16-5 

c. trucking allowance to be made on 
deliveriec from agent's va rehouse if 
located at rail receiving ooint 


8. 


Feb . 


23 


5 


- 


2 additional materials 


9. 


J " u . 


23 


5 


- 


3 additional mixes 


10. 


j ; u . 


27 


5 


No . 5 


5 b; 7 c. 


11. 


Feb. 


27 


5 : 


Fo. 8 


2 additional materials 


1?, 




2 


5 


Fo . 5 


5 b; 7c. 


13. 


, 


°5 


7 


- 


1 additional mix 


14. 


■ 


25 


7 


— 


1 additional mix 



9815 



-117- 
Table 40 

Change frora dealer to agency system, zones 1-12 



1 A pre-Code 

1 33 -ore-Code 

1 C -nre-Code 

1 D -ore-Code 



2 


A 


Jan. 


1934 


2 


3 


Jan. 


1934 


2 


C 


Jan. 


1934 


2 


D 


Jan. 


1934 


S 


A 


pre- 


Code 


3 


13 


Jan. 


1934 


3 


C 


Jan. 


1934 


3 


D 


Jan. 


1934 


3 


F 


Jr-n. 


1934 


3 


G 


Feb. 


1934 


3 


K 


pre- 


Code ; 


4 


A 


Jan. 


1934 


4 


B 


Jan. 


1934 



4 C Jan. 1934 
4 D Jan. 1934 



5 Jan. 1934 

6 Jan. 1934 

7 Aug. 1934 

8 A pre-Code 
8 B Jan. 1934 

8 C Jan. 1934 

9 pre-Code 

10 B Jan. 1934 

10 C Jan. 1934 

10 D nre-Code 



11 



Feb. 1934 



12 A Aug. 1934 
12 3 pre-Code 



See note to table 8. In the early months of the coie, and sometimes 
in the later months, v\pny conroanies sold through both independent 
dealers and commission agents (as 'ell as direct to consumers). 



9815 



-118- 



TABL3 41 



Dealers and agents, zone 8 B 



Date schedule 














made effective 


■Humber of schedules e:o'jl' r in- c : to: 


Tuo "orice 


leaders 




Dealer 


Agent 


Both 


Total 


Y 


Y 


u'ov. 15-Dec. 1, 1933 


41 


6 


2 


49 


A 


D 


Dec. 2,1935- Jan. 119 34 


11 


3 


16 


30 


A 




Jan. 2-29 




44 


2 


49 


A 


A 


Jan. 30-Feb. 5 




12 


1 


13- 






Feb. 6-Feb. 16 




11 


5 


16 




3 


Feb. 16-24 




12 


3 


15- 






Feb. 25-Iiar. 10 




14 


21 


35- 




B 


I.ar. 11-23 




21 


15 


36 


3 




I.'ar. 24- June 29 




23 


20 


43 




B 


June 30-July 6 




10 


1 


11 


A 




Jul- 7-Sept. 28 




19 


7 


26- 






Sept. 29-0ct. 25 


' 


12 


10 


22- 






Oct. 26-Nov. 14 


1 

J- 


9 


10 


20- 


A 




Nov. 15-28 


1 


17 




18- 


A 




ITov. 29- Jan. 19, 1935 


• 


33 


5 


38 


A 


A 


Jan. 20- -Feb. 15 


13 


1 


51 


65 


B 


D 


Feb. 16-I.Iar. 21 


33 


2 


36 


71- 


D 


B 


Mar. 22-May 27 


1 


48 


1 


50 


A 


A 



A: Agent 
D: Dealer 
3: Both 

Corrroanies X and Y did not file schedules in the -oeriods left blank. 



9815 



-119- 

Ta"ble 42 
Agent's compensation, zone 5 
(a leading company) 



Commission on 
time sales* 



On materials, 
if special 



On nitrate of soda 
and sulphate of 
amonia, if special 



Quantity dis- 
count allowed 
if agent 
handled in 
season more 
than: 



1933 ' 




Nov. 


15 


1934 




Jan. 


1 ' 



Feb. 5 



Feb. 24 



Mar. 5 



June 30 
Aug. 26 

Sept. 29 
Nov. 2 



1935 
Apr. 6 



104 



5%, plus 5%- for 
guaranteeing 
consumers' notes 

same 



same 



same 



deduct $1 -oer 
ton if shipped 
LCL** 



'deduct ^1 t>er ton 
'if shipped LCL • 



same 



same 

7f, plus 5^ for 
guaranteeing • 
consumers' notes 

» same 

5%', plus 54> for 
guaranteeing 
consumers' notes 



add $1 per ton 
if shipped CL 



$.2.20 ner ton 

same, but deduct 
$1 per ton if 
shinned LCL 



same 



same 



$2.20 per ten 



500 tons on 
mixed goods 

500 tons on 
everything bu 
nitrate of so 
and sulphate 
of amonia 
same 

same 

same 

same on 
materials, bu 
only 250 tons 
on mixed good: 
or superphos- 
phate 

same 



Footnote to table 42 

* Commission on cash sales 5 percent throughout. 

** LCL: less than carlots; CL : carlots 

In addition to the compensation mentioned in the table, agents were allowed to 
charge consumers for any special expenses incurred in handling LCL shipments; 
and, after December 2, 1933, they were permitted to charge extra under certain 
conditions, as follows: "Where an agent furnishes special servica or terms, 
such as warehousing goods or selling on time, to trade unacceptable to us, he 
may charge an amount separate and apart from the price of the fertilizer suf- 
ficient to repay him for special services rendered, or commensurate with the 
credit risk assumed." 



9815 



.. -rl.20- 
Tablc 43, ... 

Agent's compensation, zones 1-12 

(Percentage of consumer ' s time price paid agent on time sales, Including 
payment for guaranteeing consumer's notes when given; first and la.st 
schedules filed under Code which give agent's compensation, Do- 
ing on a consumer basis). 



Zone 


: Early 


: LLast 




Early 


J_i£LS X> 


- 


schedule 


schedule 


: Zone 


: schedule 


'. schedule 


1 A 


4<3 


*t 


'5 


9 ; 


10 


1 B 


: 5 


5 : 








1 C 


5 


5 


: :6 - ■ . 


•■ 9 :■ 


f • 11 


1 D i 


S 5 : 


5 ! 








- 






: 7 ' - ■ 


($1,50 


: 8 


2 A 


9 


9 








2 B 


9 


9 


: 8 A 


: 9 


: 8 


2 C : 


9 : 


9 ! 


8 B 


! 9 


10 


2 D : 


9 ' 


10 


8 C 


! 9 


10 


3 A ' 


10 


8 


■ 9 ' 


' 9 


9 


3 B ' • 


10 


! 9 








3 C 


10 


8 


! 10 B 


! 9 


: 9 


3 D 


10 


: 8 


10 C 


; 9 


: 9 


3 E ; 


10 


: 8 


: 10 D 


: 10 


: 10 


3 3? 


: 10 


i Q 








3 G 


10 


9 


11 


: 10 


: $3 - $5 


3 H 


9 


: 9 














: 12. A 


$3 


: 10 


4 A 


9 


10 


12 B 


: $2 


! $4 


4 B 


9 


! 10 








4 C 


: 9 


: 10 








4 D ., 


9 


1 10 









Sec note to table 8. The commissions stated in dollars can be turned 
into percentages,, as regards )ne grade of 'fertilizer, by reference to 
table 16. In Zone 7, the compensation 'stated In dollars differed 
according to the grade sold. Most but not' all of the early schedules 
cited in this table are for November 1933.. 



9845 



-121- 

Table 44 
Percentage of credit sales, zones 1-10 
(percent) 





Sales of 








State and Zone : 


fertilizer 
companies; 




Purchaser oi 
farmers 






1932 ; 


1333 i 


1934 


1933: 1934 : 


1935 


Maine (l) j 




30 : 


14 : 


28 : 


25 : 




Massachusetts (l) : 




45 : 


14 


45 . 


15 : 




Connecticut (l) : 




35 


37 


37 


50 : 




New England : 




37 


16 


37 


25 




New York (2) : 




27 : 


15 


42 


21 




New Jersey (2) 




55 


25 


57 


44 




Pennsylvania (2) i 




34 


19 


45 


30 




riddle Atlantic 




39 : 


13 


43 


28 




Ohio (10) 




14 


12 


16 


23 




Indiana (10) 




11 


11 


- 16 


21 




Illinois (10) 




- 





- 


•^ 




Michigan (10) 




17 


20 


26 


45-., 




East North Central 




14 


13 


24 


26 




Delaware (3) 




-' 


70 


- 


70:, 




Maryland (3) 




28 


20 


39 


39 




Virginia (3) (4) 


45 


23 


24 


. ' 40 


22 




North Carolina- (4) 


32 


25 


23 


: 36 


30 




South Carolina-" (5) 


15 


17 


16 


. . 32 


20 




G-eorgia (6) 


17 


20 


; 10 


28 


. 14 


: 


Florida (6) (7) (8) 


24 


37 


21 


; 40 


! 28 




South Atlantic 


22 


25- 


18" 


: 36 


; 24 




Kentucky (10) 


: 16 


17 


JF"" 


17 


21 




Tennessee (8). . 


: 20 


: 9 


11 


: 33 


. 30 




Alabama (8) (9) 


: 12 


: 13 


11 


; 26 


, 49 


* 


Mississippi (8) 


: 22 


23 


16 


: 31 


: 28 




East. South Central 


16 


16 


12 


26 


. . 44 




Arkansas (9) 


: 26 


: 19 


8 


! 39 


11 




Louisiana (8) (9) 


: 42 


: 29 


5 


! 54 


21 




Oklahoma (9) 


: 1 


: 7 


: 10 


: 42 


: 




Texas (9) 


: 17 


12 


: 4 


: 31 


: 18 




West South Central 


: 26 


: 25 


6 


: 44 


: 15 




TOTAL 


: 21 


: 24 


15 


35 


28 


23 



Source: Annual Bulletins of the Division of Agricultural Finance, 
Bureau of Agricultural Economies, Department of Agricul- 
ture, entitled: "Summary of Reports from Fertilizer Man- 
ufacturers Concerning Credit Outlook." 



9815 



J 



-122. 



Table 45 
Cash discounts, zones 1-12 
(highest cash discount - l,e, for payment on deliver-') 



First 

schedule 

filed 



Last 


:First 


Last 


schedule 


: s chedul e. 


schedule 


filed 


: filed 


filed 



1 A 


: 12 


: 14$ 


: 4 A 




1 B 


: 12 


: U 


. 4 B 




1 C 


: 12 


: 11 


: 4 C 




1 D 


: 12 


U 


. 4 D 




2 A 


: 10 


10 


5 




2 B 


: 10 


10 






2 C 


; 10 


10 


6 




2 3 


: 10 


10 


7 




3 A 


10-15 


10 






3 B 


10-15 


10 


8 A 




3 C 


10-15 


10 


8 3 




3 D 


10-15 : 


10 


8 C 




3 E 


10-15 


10 ! 






3 F 


10-15 ; 


10 : 


9 




3 G : 


10-15 : 


10 ; 






3 H : 


10-15 : 


10 : 


10 B 

10 C : 

10 D : 








1 


11 








12 A : 




j 






12 B : 





10-15 
10-15 
10-15 
10-15 

10-15 

10-15 

2 

10-15 
10-15 
10-15 

10 

10 
10 
10 



14$ 

14 
13 
14 

15 

14 

5 

9 
13 
13 



10 
10 
10 



5 
5 



See notes to tables 8 and 16 . Where two discounts are given, it means that 

carload consumers received the 150per cent discount and all others the 10 

per cent discoimt. In some zones the discount finally settled near the higher 
in others near the lower figure. 



9815 



-123- 

Table 45 

Exhibit 45 A 

Cash discounts, zone 5 
(a leading company) 

November 15, 1933 

Cash IO56 

Payment within 3 n days of invoice 9$ 

Payment within 6 n days of invoice 8$ 

Later payment: note required, bearing interest at 8$ 
Additional cash discount on carload sales to consumers 

(given by companies selling on consumer basis) 5$ 

January 1, 1934 

Interest on deposits in advance of "Purchase 8^ 

Payment by March 15 15$ 

Payment by April 15 14$ 

Payment by May 15 13$ 

Payment by June 30 12$ 

Additional discount for C.O.D regardless of month 1$ of cash price 

Payment after June 30: note required, bearing interest at 8$ 



June 30, 1954 

Same as above, except: 

(1) Dates of payment moved forward 6 months. 

(2) Interest on deposits and notes reduced from 8$ to 7$. 



September 29, 1934 

Same as above, except: 

lUtrate of soda and sulphate of ammonia allowed the top discount 
if paid for any time before December 31. 



November 2, 1934 

Same as above except: 

(1) 1 percent discount for cash eliminated. 

(2) Jther discounts reduced 2$, and final discount (12$) 3$ (to 9$), 



November 19, 1934 

Same as above, except: 

May 16-June 30 period split - 9$ being allowed in May and 7$ in June. 

9815 



-124, 
Table 46 

Quantity discounts 
Zone 5 

(a leading company) 

(on purchases in one season of tonnage mentioned 

or more) 





Agents 








Consumers 








Mixed goods and 






Mixed ; 


^oods and 








super oho sphate s 


Materials 


superol 


losohates 


Materials 




Tons 


Percent 


Tons 


Percent 


Tons 


Percent 


Tons 


Percent 


'34 








, 










Feb. 24 


500 


1 


- 


— 


100 


3 


— 


- 




1000 


2 


- 


- 


300 


4 


- 


- 




1500 


3 


- 


- 


500 


5 


- 


- 


Mar. 5 






500 
1000 


1 
2 






100 
3CQ 


1 
2 




• 




1500 


3 






500 


3 


Nov. 2 


250 

500 

1000 


1 
2 
5 






50 

100 


3 
5 






Nov. 19 










50 
100 


2 ■ 
5 







981.5 



-125- 



fable 47 

Consumers' quantity discounts, zones 1-12 
( end of code period) 





: Change from 


To image at 


Discount to: 


Principal : 


Percentage 


of 


Zone 


:first dis- 


which dis- 


"buyer of : 


state : 


farmers 






: count s un- 


count s be- 


100 tons : 




entitled to 






:der Code 


gin 






discount 




U 


: Same 


100 


If, 


Virginia 


\. . 0)0 




IB 


: Same 


15 


74 


Maine 


1.24* 




1C 


: Same 


15 


74 


a. I. 


15.4 :* 




ID 


: Same 


: 15 


74 


Conn. ' 


19. 24* 




2A 


: Higher 


20 


3'' 


New York 


11. 2=5* 




2B 


: Lower 


20 


: 34 


New York 


11 . 2}b* 




2C 


: Higher 


20 


1~5>) 


Penna. 


4.34* 




2D 


: Hi ;her 


20 


54 : 


t New Jersey 


• 26.71* 




3A 


: Higher 


20 


3;'; 


Delaware 


• 28. 6£* 




3B 


: Higher 


20 


54 


Maryland 


: 20.6-4* 




: 3C 


: Higher 


20 


54 


• 1. Va. 


: 1.4&* 




3D 


» Higher 


20 


5', 


• tf. Va. 


: 1.44* 




3E 


: Higher 


20 


5: j 


TT. Va. 


1.4,* 




3F 


: Higher 


20 


34 


Virginia 


! 14.94* 




3G 


: Higher 


20 


34 


: Virginia 


: 14.91* 




3H 


: Higher 


20 


34 


Virginia 


: 14. 94* 




4A 


: Higher 


25 


5; 


• W. Va. 


: 




43 


J Higher 


50 


tfjo 


Virginia 


: 9.2-0 




4C 


: Higher 


50 


5/o 


: N. Carolina 6.270 




4D 


: Higher 


50 


! 5; 


11. Carolina 6.0fi 




5 


: Higher 


50 


54 


• S. Carolina 12.94 


6 


: Higher 


50 


54 


' Georgia 


6.94_ 


7 


: Lower 


200 





Florida. 


7.l4*.. 


8A 


: Same 


20 


24 


Tenn. 


3.64* 




8B 


: Hi gher 


25 


Zfo 


Alabama 


12.1'. 




8C 


: Different 


50 


2 3 


Miss. 


1.94 




9 


• Lo-^er 


100 


14 


Arkansas 


.3$* 


10B 


: Different 


20 


or? 

2-,o 


Ohio 


2.04* 




IOC 


: Different 


20 


2rp 


Ohio 


2.04* 




10D 


: Different 


20 


24 


Indiana 


1.64* 




11 


: Same 


15 


$1.50 


- 


- 


12A 


: Same 


15 


$2.00 


• 


• 




12B 


: Same 


20 


1.00 


""" 


~ 





*See note to table 8. The first discounts under the Code -'ere in 
February 1934, except in Zones 1, 7, 11 and 12. The states named are 
the principal ones in eflch zone for which data on quantity purchased 
by farmers are available. These data were collected by the Association 
from 48,000 farmers in 34 states (not including any in Zones 11 and 12) 
in 1928 ("American Fertilizer Practices", loc.cit., note p. gn , pp. 59- 
63). The -oer cent ages marked with an asterisk are inexact-e.g. in Ver- 
mont 1.24 of the farmers bought 10 tons or more, so that 1.24 is the 
highest possible figure for those buying 15 tons or more; and in Ehode 
Island 6.14 bought 25 tons or more, and 15.44 bought 10 to 24,9 tons, 
the figure for 15-ton buyers being obtained by interpolation. These 
starred percentages are doubtless too high in -practically all canes. The 
trend in these percentages since 1928 is unknown. The "different" dis- 
counts are lower for big buyers, but extend the discount to smaller buyers 
than the first scale. 
9815 



-126- 



Table 43 . . 
Bag extras, zone 5 
(a. leading company - value per ton) 













Date of adoption. 


167 pound 


: 125 pound 


100 pound 


V/liite cotton 


by "3rice leader 


bags 


bags 


: bags 


bags 


1933 










.November 15 


0.25 


' $.50' 


$.75 . 


- 


1934 










January' 1 


$.25 


$.50 


,'.5.75 


'■.50 


September 29 


cj> 25 


; $.50 


; $.75 


3.73 


IT ov ember ? 


3, 25 


$ . 50 


: $.75 


$1.00 



9815 



-127- 



Table 49 



Carload discounts paid less than carload charges 
to consumers, zone 5 

(a leading company) 



Dr.te 



I a xe s and su serplio sphat e s 



Materials (if special) 



1933 

November 15 



Torms of quotation: C.L. ; /51.1-3 

per ton extra on L.C.L.;CL con- 
sumer ^ets 5-5 extra cash discount 



December 1 Terms of quotation: C.L.; actual 
freight plus $.75 per ton extra 
on L.C.L.; CL consumer gets 5/j 
extra cash discount 



1934 

January 1 



Terms of quotation 
"LCL in mixed car 
with mixed goods;" 
$1.00 per ton dis- 
count on CL 



February 5 
June 30 



January 1 prevision 
repeated 



September 29 
November 2 



January 1 provision 
repeated 



15 



-128- 



Table 50 

Uniformity in trices and tens of sales, February 4, 1934 

zone 5 



Number of 


! Terms in typical schedule 


Terms different from 


companies 


! omitted entirely 


typical schedule 


33 


- 


- 


7 


Extra charge for tobacco grades 


- 


3 


Bulk discounts 


- 


2 : 


Interest allowed on deposits prior ! 






to purchase 


- 


2 


Sale to government agencies; ' 






bag extras 


— 


1 ! 


- 


Higher price on nitrate 
of soda 


1 ! 


Charge for special mixtures 


- 


1 


Bulk discounts; extra charge for 






tobacco grades 


— 


1 


Interest on deposits; bag extras 


- 


1 


Interest on deposits 


Higher price on mixed 
goods 


1 


Interest charged on overdue pay- 


Lower agent's compen- 




ments; cash discounts (sold for 


sation; lower prices 




cash only); bag estras; charge for 






special mixtures 




1 


Delivery to be at railhead at option 
1 of company; sales to government 






agencies; bag extras; interest on 


— 




! deposits; extra charge for tobacco 






: grades 




1 


! Bag extras 


Interest on deposits 6$ 
instead of 8% 


1 


: Balk discounts on mixed goods; bag 






: extras 


~ 



About 23 : (Original 1933 lists still in effect hence altogether different) 



9315 



-129- 
Table 51 
Uniformity in prices and terms of sale, April 1, 1935, zone 5 



Number of 
companies 



Terms in typical schedule 
omitted entirely 



Terms different from 
typical schedule 



2 
20 

17 
17 



3 

2 
1 
1 

1 
1 

about 20 



requirement that agent must 
guarantee consumer's notes 



agent's compensation on 
cal-n'itro $2.50 instead 
of $2.20 

effective date of quan- 
tity 'discount 

cash discount 13$ through- 
out season, instead of 
gradual drop to 7$ 

agent's compensation 7% 
(varying on various mater- 
ials) instead of 3fo flat 
and 5$ for guaranteeing 
notes 



provision for interest, on money 
deposited before season and in- 
terest on overdue accounts 

bag extras 

(additional $1 for use. of own bags) 

special mix provision 



- charge for special mix $1 

instead of $2 

- 'no charge for special mix 

(entirely -different: F.O.B, plant price, 
cash only) 

(earlier lists still in effect: 10 very different; 
10 slightly different) 



9815 



-130- 
Table 52' 

Tax 'tag' sales classified by size of company, four states 
Percentage increase in tax tag sales, 1935 to 1934 





Big companies 


Medium-sized companies: 


Small companies 


Alabama 


6,9$ 


51.6$ 


155.5$ 


Georgia 


29.2 


55.5 


49.4 


Mississippi 


70.0 


90.6 


58.6 


Texas 


68.1 


73.3 


106,8 


Total 


27.0 


56.8 


64. C 



From Senate Hearings, loc. cit., note p. 12 , page 1758 



Trends in tax tag sales, Alabama, 1932-33 to 1934-35 



Increase, 1933-1 


Big companies 


Medium-sized companies 


Small companies 


54 


■ 




to 1934-35 








Tons 


16,330 


7,700 


18,550 


Percent 


9.2$ 


7.8$ 


54.8$ 


Percentage of 








total business 








1932-33 


62i3$ 


22. r.$ 


9.3$ 


1933-34 


49.7 


27.9 


9.4 


1934-35 


46.9 


25.9 


12.6 



The Alabama figures (supplied in detail by the Association) indicate that the 
large percentage increases shown above may correspond to much smaller 
relative increases in tonnage. Although this qualifies the conclusion of 
the first table, it still appears that small producers have gained the most 
of the three classes. Exporters and raw material producers had the follow- 
ing percentages of the total business: 



6.4$ 
13.0 
14.6 ' 



(1932-33) 
(1933-34) 
(1934-35) 



9815 



-131- 

Table 53 

Changes in consumer's prices and terms, June 1935 

Maryland 

Frice change: ^-12-5 




Cash price 



Last schedule under Code 
June 1935 schedule 



$20.93 
20.39 



Other changes: Agent's compensation reduced from 9% to 8%, 



Virginia and States South 



Price cnanges:4-8-4 


List * 


Cash * 


List ** 


Cash ** 


Virginia (4B district) 


$31.10 


$26.75 


$25.10 


$22.34 1/ 


North Carolina 


31.10 


26.75 


26.39 


23.41 1/ 


South Carolina: 










East 


29.30 


25.49 


25.30 


22.52 


West 


29.30 


25.49 


25. 90 


23.05 


Georgia: 










Nor th 


29.05 


26.15 


25.90 


23.05 


South 


29.05 


26.15 


25.30 


22.52 


Alabama 


29.64 


25.79 


28.15 


25.06 


Mississippi and 










Eastern Louisiana 


31.75 


27.62 


28.60 


! 26.00 


Tennessee 


30. 8C 


27.41 


29.70 


27. OC 



* Last schedule under code. 
** Jure 1935 schedule, 

1/ The schedules break up these two States and West Virginia into six 
districts. 

Other changes 

(1) Prices guaranteed against decline until December 1, 

(2) -fertilizer to be sold to consumers through salaried salesmen as 
well as agents. 

(3) Quantity discounts to be alloved to consumers buying over 50 tons 
and agents handling over 1000 tons (a more severe restriction in 
several states - cf. tables 46,47). In Tennessee the limits were 
made 40 and 500 tons, respectively; and in Mississippi 50 and 200, 

(4) Cash discounts to be 7 to 11 percent, depending on date of 
payment - except in Tennessee, 'Mississippi, and Eastern Louisiana, 
where time prices were made 10 percent more than cash prices. 



9815 jl 



OFFICE OF THE NATIONAL RECOVERY ADMINISTRATION 
THE DIVISION OF REVIEW 

THE WORK OF THE DIVISION OF REVIEW 

Executive Order No. 7075, dated June 15, 1935, established the Division of Review of the 
National Recovery Administration. The pertinent part of the Executive Order reads thus: 

The Division of Review shall assemble, analyze, and report upon the statistical 
information and records of experience of the operations of the various trades and 
industries heretofore subject to codes of fair competition, shall study the ef- 
fects of such codes upon trade, industrial and labor conditions in general, and 
other related matters, shall make available for the protection and promotion of 
the public interest an adequate review of the effects of the Administration of 
Title I of the National Industrial Recovery Act, and the principles and policies 
put into effect thereunder, and shall otherwise aid the President in carrying out 
his functions under the said Title. I hereby appoint Leon C. Marshall, Director of 
the Division of Review. 

The study sections set up in the Division of Review covered these areas: industry 
studies, foreign trade studies, labor studies, trade practice studies, statistical studies, 
legal studies, administration studies, miscellaneous studies, and the writing of code his- 
tories. The materials which were produced by these sections are indicated below, 

Except for the Code Histories, all items mentioned below are scheduled to be in mimeo- 
graphed form by April 1, 193S. 

THE CODE HISTORIES 

The Code Histories are documented accounts of the formation and administration of the 
codes. They contain the definition of the industry and the principal products thereof; the 
classes of members in the industr, ; the histor;, of code formation including an account of the 
sponsoring organi ations, the conferences, negotiations and hearings which were held, and 
the activities in connection with obtaining approval of the code, the history of the ad- 
ministration of the code, covering the organization and operation of the code authority. 
the difficulties encountered in administration, the extent of compliance or non-compliance, 
and the general success or lack of success of the code, and an analysis of the operation of 
code provisions dealing with wages, hours, trade practices, and other provisions. These 
and other matters are canvassed not only in terms of the materials to be found in the files, 
out also in terms of the experiences of the deputies and others concerned with code formation 
and administration. 

The Code Histories, (including histories of certain NRA units or agencies) are not 
mimeographed. They are to be turned over to the Department of Commerce in typewritten form. 
All told, approximately eight hundred and fifty (850) histories will be completed. This 
number includes all of the approved codes and some of the unapproved codes. (In Work 
Material s No 18, Content s of Code Histries . will be found the outline which governed 
the preparation of Code Histories.) 

(In the case of all approved codes and also in the case of some codes not carried to 
final approval, there are in NRA files further materials on industries. Particularly worthy 
of mention are the Volumes I, II and III which constitute the material officially submitted 
to the President in support of the recommendation for approval of each code. These volumes 
9768--1 . 



-11- 

set forth the origination of the code, the sponsoring group, the evidence advanced to sup- 
port the proposal, the report of the Division of Research and Planning on the industry, the 
recommendations of the various Advisory Boards, certain types of official correspondence, 
the transcript of the formal hearing, and other pertinent matter. There is also much offi- 
cial information relating to amendments, interpretations, exemptions, and other rulings. The 
materials mentioned in this paragraph were of course not a part of the work of the Division 
of Review. ) 

THE WORK MATERIALS SERIES 

In the work of the Division of Review a considerable number of studies and compilations 
of data (other than those noted below in the Evidence Studies Series and the Statistical 
Material Series) have been made. These are listed below, grouped according to the char- 
acter of the material. (In Work M aterials No . 17 . Tentati ve Outlines and Summaries of 
Studies in Process , these materials are fully described). 

I ndustry Studies 

Automobile Industry, An Economic Survey of 

Bituminous Coal Industry under Free Competition and Code Regulation, Economic Survey of 

Electrical Manufacturing Industry, The 

Fertilizer Industry, The 

Fishery Industry and the Fishery Codes 

Fishermen and Fishing Craft, Earnings of 

Foreign Trade under the National Industrial Recovery Act 

Part A - Competitive Position of the United States in International Trade 1927-29 through 

1934. 
Part B - Section 3 (e) of NIRA and its administration. 
Part C - Imports and Importing under NRA Codes. 
Part D - Exports and Exporting under NRA Codes. 
Forest Products Industries, Foreign Trade Study of the 
Iron and Steel Industry, The 
Knitting Industries, The 
Leather and Shoe Industries, The 

Lumber and Timber Products Industry, Economic Problems of the 
Men's Clothing Industry, The 
Millinery Industry, The 
Motion Picture Industry, The 
Migration of Industry, The: The Shift of Twenty-Five Needle Trades From New York State, 

1926 to 1934 
National Labor Income by Months, 1929-35 
Paper Industry, The 

Production, Prices, Employment and Payrolls in Industry, Agriculture and Railway Trans- 
portation, January 1923, to date 
Retail Trades Study, The 
Rubber Industry Study, The 

Textile Industry in the United Kingdom, France, Germany, Italy, and Japan 
Textile Yarns and Fabrics 
Tobacco Industry, The 
Wholesale Trades Study, The 

Women's Neckwear and Scarf Industry, Financial and Labor Data on 
9768—2 



- Ill - 

Women's Apparel Industry, Some Aspects of the 

T rade Practic e St udies 

Commodities, Information Concerning: A Study of NRA and Related Experiences in Control 
Distribution, Manufacturers' Control of: Trade Practice Provisions in Selected NRA Codes 
Distributive Relations in the Asbestos Industry 
Design Piracy: The ProbJem and Its Treatment Under NRA Codes 
Electrical Mfg. Industry: Price Filing Study 
Fertilizer Industry: Price Filing Study 

Geographical Price Relations Under Codes of Fair Competition, Control of 
Minimum Price Regulation Under Codes of Fair Competition 
Multiple Basing Point System in the Lime Industry: Operation of the 
Price Control in the Coffee Industry 
Price Filing Under NRA Codes 
Production Control in the Ice Industry 
Production Control, Case Studies in 

Resale Price Maintenance Legislation in the United States 

Retail Price Cutting, Restriction of, with special Emphasis on The Drug Industry. 
Trade Practice Rules of The Federal Trade Commission (1914-1936) : A classification for 
comparison with Trade Practice Provisions of NRA Codes. 

Labor Studies 

Cap and Cloth Hat Industry, Commission Report on Wage Differentials in 
Earnings in Selected Manufacturing Industries, by States, 1933-35 
Employment, Payrolls, Hours, and Wages in 115 Selected Code Industries 1933-35 
Fur Manufacturing, Commission Report on Wages and Hours in 
Hours and Wages in American Industry 
Labor Program Under the National Industrial Recovery Act, The 

Part A. Introduction 

Part B. Control of Hours and Reemployment 

Part C. Control of Wages 

Part D. Control of Other Conditions of Employment 

Part E. Section 7(a) of the Recovery Act 
Materials in the Field of Industrial Relations 
PRA Census of Employment, June, October, 1933 
Puerto Rico Needlework, Homeworkers Survey 

Administrativ e Studies 

Administrative and Legal Aspects of Stays, Exemptions and Exceptions, Code Amendments, Con- 
ditional Orders of Approval 

Administrative Interpretations of NRA Codes 

Administrative Law and Procedure under the NIRA 

Agreements Under Sections 4(a) and 7(b) of the NIRA 

Approve Codes in Industry Groups, Classification of 

Basic Code, the — (Administrative Order X-61) 

Code Authorities and Their Part in the Administration of the NIRA 
Part A. Introduction 
Part B. Nature, Composition and Organization of Code Authorities 

9768—2. 



Part C. Activities of the Code Authorities 

Part D. Code Authority Finances 

Part E. Summary and Evaluation 
Code Compliance Activities of the NRA 
Code Making Program of the NRA in the Territories, The 
Code Provisions and Related Subjects, Policy Statements Concerning 
Content of NIRA Administrative Legislation 

Part A. Executive and Administrative Orders 

Part B. Labor Provisions in the Codes 

Part C. Trade Practice Provisions in the Codes 

Part D. Administrative Provisions in the Codes 

Part E. Agreements under Sections 4(a) and 7(b) 

Part F. A Type Case: The Cotton Textile Code 
Labels Under NRA, A Study of 

Model Code and Model Provisions for Codes, Development of 

National Recovery Administration, The; A Review of its Organization and Activities 
NRA Insignia 

President's Reemployment Agreement, The 

President's Reemployment Agreement, Substitutions in Connection with the' 
Prison Labor Problem under NRA and the Prison Compact, The 
Problems of Administration in the Overlapping of Code Definitions of Industries and Trades, 

Multiple Code Coverage, Classifying Individual Members of Industries and Trades 
Relationship of NRA to Government Contracts and Contracts Involving the Use of Government 

Funds 
Relationship of NRA with States and Municipalities 
Sheltered Workshops Under NRA 
Uncodified Industries: A Study of Factors Limiting the Code Making Program 

Legal Studies 

Anti-Trust Laws and Unfair Competition 

Collective Bargaining Agreements, the Right of Individual Employees to Enforce 

Commerce Clause, Federal Regulation of the Employer-Employee Relationship Under the 

Delegation of Power, Certain Phases of the Principle of, with Reference tc Federal Industrial 

Regulatory Legislation 
Enforcement, Extra-Judicial Methods of 
Federal Regulation through the Joint Employment of the Power of Taxation and the Spending 

Power 
Government Contract Provisions as a Means ;f Establishing Proper Econcmic Standards, Legal 

Memorandum on Possibility of 
Industrial Relations in Australia, Regulation of 

Intrastate Activities Which so Affect Interstate Commsrce as to Bring them Under the Com- 
merce Clause, Cases on 
Legislative Possibilities of the State Constitutions 
Post Office and Post Road Power — Can it be Used as a Means of Federal Industrial Re^uls- 

tlon? 
State Recovery Legislation in Aid of Federal Recovery Legislation History and Analysis 
Tariff Rates to Secure Proper Standards of Wages and Hours, the Possibility *.f Variation ia 
Trade Practices and the Anti-Trust Laws 
Treaty Making Power of the United States 

War Power, Can it be Used as a Means of Federal Regulation of Child Labor? 
9768—4. 



THE EVIDENCE STUDIES SERI ES 

The Evidence Studies were originally undertaken to gather material for pending court 
cases. After the Schechter decision the project was continued in order to assemble data for 
use in connection with the studies cf the Division of Review. The data are particularly 
concerned with the nature, size and operations of the industry; and with the relation of the 
industry to interstate commerce. The industries covered by the Evidence Studies account for 
more than one-half of the total number of workers under codes. The list of those studies 
follows: 



Automobile Manufacturing Industry 
Automotive Parts and Equipment Industry 
Baking Industry 

Boot and Shoe Manufacturing Industry 
Bottled Soft Drink Industry 
Builders' Supplies Industry 
Canning Industry 
Chemical Manufacturing Industry 
Cigar Manufacturing Industry 
Coat dnd Suit Industry 
Construction Industry 
Cotton Garment Industry 
Drees Manufacturing Industry 
Electrical Contracting Industry 
Eiect"ical Manufacturing Industry 
Fabricated Metal Products Mfg. and Metal Fin- 
ishing and Metal Coating Industry 
Fishery Industry 

Furniture Manufacturing Industry 
General Contractors Industry 
Graphic Arts Industry 
Gray Iron Foundry Industry 
Hosiery Industry 

Infant's and Children's Wear Industry 
Iron and Steel Industry 



Leather Industry 

Lumber and Timber Products Industry 
Mason Contractors Industry 
Men's Clothing Industry 
Motion Picture Industry 
Motor Vehicle Retailing Trade 
Needlework Industry of Puerto Rico 
Painting and Paperhanging Industry 
Photo Engraving Industry 
Plumbing Contracting Industry 
Retail Lumber Industry 
Retail Trade Industry 

Retail Tire and Battery Trade Industry 
Rubber Manufacturing Industry 
Rubber Tire Manufacturing Industry 
Shipbuilding Industry 
Silk Textile Industry 
Structural Clay Products Industry 
Throwing Industry 
Trucking Industry 
Waste Materials Industry 
Wholesale and Retail Food Industry 
Wholesale Fresh Fruit and Vegetable Indus- 
try 
Wool Textile Industry 



THE STATISTICAL MATERIALS SERIES 



This series is supplementary to the Evidence Studies Series. The reports include data 
en establishments, firms, employment. Payrolls, wages, hours, production capacities, ship- 
ments, sales, consumption, stocks, prices, material costs, failures, exports and imports. 
They also include notes on the principal qualifications that should be observed in using the 
data, the technical methods employed, and the applicability of the material to the study of 
the industries concerned. The following numbers appear in the series: 
9768—5. 



- vi - 

Asphalt Shingle and Roofing Industry Fertilizer Industry- 
Business Furniture Funeral Supply Industry 
Candy Manufacturing Industry Glass Container Industry 
Carpet and Rug Industry Ice Manufacturing Industry 
Cement Industry Knitted Outerwear Industry 
Cleaning and Dyeing Trade Paint, Varnish, and Lacquer, Mfg. Industry 
Coffee Industry Plumbing Fixtures Industry 
Copper and Brass Mill Products Industry Rayon and Synthetic Yarn Producing Industry 
Cotton Textile Industry Salt Producing Industry 
Electrical Manufacturing Industry 

THE COVERAGE 

The original, and approved, plan of the Division of Review contemplated resources suf- 
ficient (a) to prepare some 1200 histories of codes and NRA units or agencies, (b) to con- 
solidate and index the NRA files containing some 40,000,000 pieces, (c) to engage in ex- 
tensive field work, (d) to secure much aid from established statistical agencies of govern- 
ment, (e) to assemble a considerable number of experts in various fields, (f) to conduct 
approximately 25% more studies than are listed above, and (g) to prepare a comprehensive 
summary report. 

Because of reductions made in personnel and in use of outside experts, limitation of 
access to field work and research agencies, and lack of jurisdiction over files, the pro- 
jected plan was necessarily curtailed. The most serious curtailments were the omission of 
the comprehensive summary report; the dropping of certain studies and the reduction in the 
coverage of other studies; and the abandonment of the consolidation and indexing of the 
files. Fortunately, there is reason to hope that the files may yet be cared for under other 
auspices. 

Notwithstanding these limitations, if the files are ultimately consolidated and in- 
dexed the exploration of the NRA materials will have been sufficient to make them accessible 
and highly useful. They constitute the largest and richest single body of information 
concerning the problems and operations of industry ever assembled in any nation. 

L. C. Marshall, 
Director, Division of Review. 
9768—6. 






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