Evening Republican, Volume 18, Number 133, Rensselaer, Jasper County, 6 June 1914 — Co-Operative Farm Products Marketing [ARTICLE+ILLUSTRATION]

Co-Operative Farm Products Marketing

How It Is Done in Europe and May Be Done in America to the Profit of Both Farmer and Consumer

By MATTHEW S. DUDGEON.

. (Copyright. 181*. We* ter a Newspaper Union. >

Teaching Danish Agricultural Students How to Handle a Horse. A COOPERATIVE BACON FACTORY

Frederickssund, Denmark. —We take off our hats to the Danish packing house and Its product Here a most efficient packing house takes a high grade pig and manufactures him into the best bacon on earth. If Armour or Cudahy or Morris were here he would be compelled to join us In our salutation of the packing houses of Denmark. Here is the last word as to efficient scientific treatment of the dead porker. But in Denmark they demand something more than scientific treatment In the packing house. The Danish theory is that to produce good bacon you must go back into the history of the pig. They want to know of what breed he was, that he was raised in a sanitary pen, on pure, wholesome food, that he was between five and seven months old, and weighed from 180 to 200 pounds when butchered. He may not be a scrub, picked up by the buyers and rushed into the yards to be killed and cured, as may be the case in America. The Danish pig is an efficient scientific agency for transforming pure milk and grain and root crops and fodder into .fine pig meat. And so when the best packing house methods deal with the best pig the result is sure to be the best bacon. And the farmers after they have raised the pig and cured the bacon in the bacon factory which they themselves own, Insist that they get the profit from the sale. So these Danish farmers keep possession of the bacon until it is placed upon the counters of the retail dealers in England. In this way they get all the profits there are in the entire process. Organized Without Money. This is the way in which it is done. The bacon factory here at Frederickssund is owned by 3,000 farmers. There ■are big farmers and little farmers iamong them. Some of them have ionly five acres, and others have hunidreds of acres. Some contribute only tone or two hogs per year, while oth- . era send theirs in by the hundred. Strange to say, while the factory now represents a very large Investment

and while the farmers who own It hare In the aggregate great wealth, the plant was established without the direct Investment of one dollar. There was no capital paid In and there were no bonds issued. A large number of formers simply got together, organised, elected officers and directed that these officers should. In their behalf, borrow sufficient capital at the nearby bank to erect the plant and start the business. And the bank stood for it, well knowing that the unlimited liability of hundreds of farmers who were Interested In the bacon factory was the best security In the world; well knowing also that under proper management a bacon factory was Itself one of the most sound and profitable business ventures Into which these same farmers could go. High Grade Manager. This concern Is owned by 3,000 thrifty, close-fisted, money-making farmers, but they do not run this business on any narrow gaugo plan. They know that Incompetence does hot pay. They want good results and so employ the best superintendent and manager that monetary considerations can secure. His name Is Frederick L. Sleek. He Is an educated, widely read, much traveled, scientifically trained business man, who understands farming and hog raising In all Its details. He knows all about pigs from breeding to eating. He has studied every known process of transforming a live pig Into the finest bacon. He knows all about the by-products, be they sausage or fertilizers made from the Hood. He understands the problems of transportation. He Is familiar with the markets of the world and with the demands of each. Into his plant he has Introduced all the latest efficiency devices. He Is in the broadest sense, a competent, efficient, high priced manager. Overcoming Unfair Competition. Although for some twenty or thirty years co-operation has been in successful operation in Denmark, no cooperative society can count upon the ihssnes of rivalry and competition

from private dealers. Earlier in the game more than one co-operative society was sadly hindered in being outbid in its efforts to purchase the products of its members. It is hard indeed for the farmer to realize that he should accept $lO per hundred for his pigs from a co-operative society while the outside dealer is offering him sll per hundred. The private dealers here played the game that they are playing in America. Whenever any co-operative concern started doing business the private dealer at once outbid it. Here as in America the farmers sometimes abandoned their co-operative society and sold to the highest bidder. Occasionally the co-operative concern was pushed to the wall and went out of business. Here as in America the private dealer Immediately dropped his price and the farmer was where he was before getting whatever price the dealers agreed upon among themselves. No Selling to Rival Dealers. It did not take the organizers of the co-operative movement long to realize that this could not go on. Consequently, when a new organization is started now the matter is fully explained to the prospective members. They are told that unless they expect to give unlimited loyalty to the concern, unless they are willing to agree to bring all of their output to the society even when the society is outbid by private dealers, there is no use in starting a fioclety at all. It is fully explained to them that the high prices which may be offered can only be temporary and that the permanent welfare of the community demands that the co-operative concern be organized and be loyally supported. The matter thus fully before them the Danish farmers do not hesitate to enter into a contract to deliver all their product to the local co-operative society. The members of this bacon factory here are under absolute agreement to deliver pigs to no other dealer, although any member may of course use such hogs as he needs for his own use. . ■ -

If a member delivers pigs to any dealer he is penalized. He has gone into this agreement with full knowledge of its purpose. As ft result no one seems to be In the least. dissatisfied, although occasionally competitors offer prices that are indeed tempting. The manager told us, however, that repeatedly he had farmers not only express satisfaction over the profits which they were receiving, but when In addition to a fair price they have beep paid a dividend they have repeatedly remonstrated that It seemed to them they were getting more than they should out of the con* corn.

Sixty Thousand Pigs Per Year. “We handle from sixty thousand to seventy thousand pigs each year, said the manager. "During parts of the year two thousand pigs per week will come in. These all are nearly of the same age and size, practically all being between twenty-four and twenty-eight weeks old and weighing from 180 to 200 pounds. They have been fed almost the same food and have been raised upon conditions that are absolutely uniform. Slight differences occur in the individuals, some being a little fatter than their mates, others differing in the quality of meat, although it would take an expert to detect these differences. Our annual turn over of bacon amounts to about a million and a half dollars. We send out some fresh pork. Our leading article is cured side bacon with bam and shoulder attached. We send out also lard, sausage, boneless ham and a number of by-products. You will note as you go through the factory that every product which -we send out is marked with a government stamp with the number 39, which is the number of this factory. Utilising All Except ths Squeal. "All the waste from the factory is carefully cared for. We do not destroy a particle of material that comes in. Some one has said that the only thing we have not been able to make mopey out of is the squeak For example, we manufacture bone meal for chicken feed. We turn the blood into

Fixing Prices.

a special quality of fertilizer, most of which is shipped to Germany and Holland and used largely upon their famous tulip beds. We burn nothing. Most of the offal goes back to the farms- of this region as manures. There is no more profitable use for it The very water with which we flush out our slaughter rooms Is used as a fertilizer. Each Friday we send out quotations of prices which will prevail during the coming week. About one-half of our output however, is sold in advance on standing orders from England. They direct us to send them so many hundred pounds at the ruling price. They understand, of course, that we will fix a fair market price upon what we send them. With these who want good bacon, however, It is not so much a question of price as a question of quality, and it is because of our quality that we have these standing orders.”

Each of the factories has a local price-fixing committee, consisting of the. president of the local society, a well-known farmer who is not a director of the society, and the manager of the factory. The manager of course, produces the latest market reports, telegrams and all other information obtainable as to the results of previous shipments, the state of the market and its trend whether up or down. After providing foi a small profit which goes to the sinking fund and allowing a quarter of a cent per pound for working expense the committee decides upon the prices which should be paid and which it will recommend to the general district committee. The district committee of the» Federation of Bacon Factories meets once a week to fix the prices which are to prevail for the following week. This general committee first learns the views of all the local factory committees in the district and sets the prices according to their recommendations; that is to say, if five local committees recommend 45 ore per pound, while five others place the figures at 46, the general committee sets it at 45%. It Pays the Farmer. "We are now paying a little over fifteen dollars per hundred weight. Other private dealers pay the same price, but with the private dealer the first return is all the farmer will ever get for his pigs. Each year we lay aside something for our reserve fund, and something to pay off what we borrowed at the bank. After we have done this we declare an annual dividend, which amounts to from $1.25 to $1.50 on each hog that has been delivered to us. You see also that at the end of the ten years’ period each farmer has a share in our establishment here, which may be termed an additional price for his pigs. Under our system each farmer has an Interest in this concern, when it is finally paid for, in proportion to the number of pounds of pork which he has delivered to us during all these years. We figure that the average amount, which has been laid aside and Invested In this plant. Is about twenty-five dollars per member. We do not pay this In cash to them, but Issue a certificate which Is evidence that they own a share In this plant and in the business which we are doing here. This Is not a closed corporation, but any farmer who wishes to join it can do so by paying the estimated value of membership. Standing Together. "There are 43’ co-operative bacon factories In Denmark. We have a central organization, which Is rather a voluntary association for the mutual benefit of the various co-operative bacon factories. The office Is In Copenhagen. Weekly reports come In from each factory giving the amount killed and sold, the expense of the business and the market returns received. The heads of the various factories meet from time to time to talk over the best business methods and possible Improvements In our way of handling bacon. We give each other the benefit of our experience and think of every way'possible to help each other. We do not feel that we are, in any antagonistic sense, rivals. We fully believe that every factory is helped by the successor the other factories. The success of each depends upon the fact that all of the factories are putting out a good product and are dealing In an honest business-like way with the foreign retailers who take our products. What hurts one of us hurts all of us. We are anxious, therefore, to help each other in every way, since In helping others we are helping ourselves. "Our agricultural schools and our government departments help us, particularly upon all scientific problems. They help us along the technical side of all our work. They make experiments and give advice and cooperate with us generally In a thousand ways.” Possibly the most striking thing about the factory is that a group of farmers should run a concern that rivals in efficiency and . business methods the largest and best privately owned packing houses of the world. We expect farmers to farm well but we do not expert them to do business well. In America they take what is given them for'the raw product and go no further. Here they go so far as to get all there is in it. The farmer who raises the pig holds to it and keeps it as his property until it lands in the retail shops of England. All intervening processes are under his control and all Intervening profits are his owa. Denmark presents to the world the’scientific farmer who is an efficient business man wm the American farz'sr over * taln that position ?