I believe, Mr. Chairman, that in no part of the world is there a call for a change in the condition less than there is in Minnesota. I believe that to-day I far better represent the farming interests of Minnesota than any one of these gentlemen who have spoken here. It is a comparatively easy matter for a man to get up and say, "I represent 100,000 farmers, or 200,000 farmers," or any other number. I have had my dealings with them and they usually deal in very large figures; but I believe I repeat it-that I am in closer touch with the great farming interests of Minnesota than a single one of these gentlemen who have come before you at this time. That is my business. It has been my business for a number of years. And, Mr. Cantrill, I wish to call your attention, you asked the other day as to whether the farmers of Minnesota were finding it profitable to engage in farming. I wish that I could take you on a trip through the Red River Valley. I wish I could take you into some of the beautiful sections of this State, and I would not need to say a word, but the condition of the country would answer that question and answer in the affirmative. And I am going to call your attention at this time to some examples with which I am persoually familiar.

The first one is this: When I first came to the Red River Valley, there was a very large farm in the southern part that was being broken up. It was a farm that belonged to Mr. Dwight, formerly a Member of the Congress of the United States. There was a young man living in the town who was casting longing eyes, as every sensible young man does, upon some of the farms in the outlying territory. Mr. Dwight said to this young man, There is such-and-such a section, which lay about 5 miles out of town-I am well acquainted with it and have driven over it a hundred times--and he said to this young man, "I will sell you this farm for so many dollars per acre." My recollection is that it was $12 per acre. The young man employed all his finances; he strained his credit to the breaking point to break and prepare this piece of land for a crop, and he succeeded in doing it. The land was broken, the crop was garnered, and the proceeds of that crop paid for the farm entirely. I know of other instances where men have told me-men who are reliable that they have raised several crops in the course of their lifetime that have practically paid for the farm. And along this line I want to call your attention again, referring to the sturdy viking from Meeker County, in which, coming down on the train, he told me about his farm, costing $15 per acre, if I remember correctly, and now that he regarded it as worth $150 per acre.

It does not look very much as though the farmer were suffering from the condition of the grain market in the State of Minnesota, and I have no doubt it is true that farms have increased in the last 10 years more than 100 per cent in value, because of the ability of the farmers farming them, and because of the natural rise in land; and at this time, Mr. Chairman, the farmers from Illinois and the farmers from Indiana, the farmers from Iowa, are literally flocking into the State of Minnesota and buying land. Why do they do this? Mr. Chairman, why is it that it has apparently been reported that Honus Wagner and Christy Mathewson and certain other lords of that great fraternity that might be mentioned are simply given a check and simply fill out the sum they would require for their services during the season? Why has this been done? Because they know that

Honus Wagner and Christy Mathewson will deliver the goods. And the same reason is why the farms of Minnesota are being so eagerly sought at this time, simply because they know that the farms of Minnesota when the time comes will deliver the goods, and that it will be a splendid and profitable investment.

Mr. CANTRILL. Right there, Mr. Works, at that point what is the average wheat production of your State? What was it last year? Mr. WORKS. Approximately 90,000,000 bushels. Mr. CANTRILL. Per acre, what was it?

Mr. WORKS. The figures are not made up at the present time, but I should presume likely that throughout the State it would be somewhere in the neighborhood of something like 15 or 16 bushels to the acre, but in the Red River Valley, and some parts of southern Minnesota where conditions are more favorable, it is a very common thing for the yield to run above 35 bushels.

Mr. CANTRILL. I mean, taking the State as a whole?

Mr. WORKS. Well, as I told you, I think about 15 or 16 bushels— approximately that.

Mr. CANTRILL. What would be the average value of that wheat land per acre?

Mr. WORKS. The average value varies very much. We have land in southern Minnesota which sells for $125. Land in the Red River Valley averages probably $45 per acre.

Mr. CANTRILL. Now, at an average of 15 bushels per acre, what does it cost to prepare and sow and harvest and get to market an acre of wheat in your State?

Mr. WORKS. Mr. Chairman, I am farming if you will pardon a personal reference approximately 10,000 acres of land. In the very nature of things I am obliged to hire everything done, and I wish that I had my books here, because I open a ledger account with every farm. What I produce is credited, and what I pay out is charged. I have just made some figures here from memory, which are not very far from correct, and I usually charge off $1.50 for plowing the land, $1 per acre for seed, $1 for planting, $1.50 for the harvesting of the crop. Thrashing cost, on an average, 3 cents per bushel. Of course, the amount of the thrashing bill will depend a great deal upon what the crop produces per acre.

Mr. CANTRILL. Three cents a bushel for thrashing wheat, you say? Mr. WORKS. Yes; 3 cents a bushel. Although I consider that there is a profit on all this land, of course in my business I use probably the most economical methods that can be used. I have two large gasoline engines with which I plow from 30 to 50 acres per day with each one. Of course, the planting is done along the same line, and harvesting in like manner. It has been said by the Dalrymple Farm managers, who farm and own the largest farm in the Northwest, that the wheat can be raised at a cost of less than 50 cents per bushel. I have never figured it that way. I have always figured it and entered it on my books as an acreage proposition, but I have not any doubt but what they are correct, and that there is a profit in raising wheat if you can raise 10 bushels per acre and the price averages as it has averaged for the last 10 or 15 years. Before that, I know nothing about it except what I am told, but I have no doubt it is correct.

Now, I want to call the attention of this committee to another matter, and that is in reference to the handling and marketing of the crop. As I said before, I am in close touch with the farmers of my locality, and, Mr. Chairman, I have never heard a single complaint charged up against the chamber of commerce. I have heard people say that they have sent wheat there that they thought ought to grade No. I and it had been graded No. 2. But that, of course, is a matter which the State law has to do with, and in this connection I want to say further that the system of handling the grain, weighing, sampling, and grading by the State is as near perfect as any human system in the world can be. But I have thought a great many times, when I have shipped my wheat or my flax or my oats, or any other grain, to members of the Minneapolis Chamber of Commerce, and when the returns came in and I would look it over, so many dollars for freight and then $10 for commissions-an average of about $10 for commissions per car-and it seemed to me a ridiculously small thing. How would it be possible for a man, a farmer, to market his own crop if it could not be done through the medium of these commission men or middlemen?

Then, again, I wish to refer to the matter of hedging, as it applies to the farmer. Now, there are to-day in Minnesota, among the more progressive farmers, an increasing number of farmers who recognize the value of selling their crops when a good price can be obtained. Some years ago-to make the illustration absolutely concrete-I looked over a crop of wheat growing in July, and I figured that we would have 20,000 to 25,000 bushels of wheat. The wheat market at that time was very strong, owing to the conditions in the Southwest, and I am quite sure that it was the house of Van Dusen & Harrington through which the deal was made. The wheat was sold at $1.13 for delivery in September, and when the new crop commenced to come in the price went down, and when the deal was closed it was closed at 92 cents. The wheat was then put into the bins and it was carried through December and sold at $1.06 or $1.08, if I remember correctly; not very far from that.

Another instance comes to my mind, which I will relate briefly. During the season of 1912 I had quite a large crop of flax. In July the flax market was up around $1.75, and I sold aggregating 10,000 or 12,000 bushels to the firm of E. L. Welch & Co., to be delivered in October at $1.74. Flax continued to go down until the time of delivery it was somewhere in the neighborhood of $1.35 or $1.40, and I closed the option. I carried it in the bins until the next season, and in the spring, when I desired the bins to be emptied for other purposes, I put it into the Minneapolis market and sold flax for later delivery, and so did fairly well on that deal.

Now, those are some things, the value of hedging-future sales rather as it appeals to the farmer, and there is to-day an increasing number of them that are taking advantage of this opportunity for profit. It can be done, even with a small crop of about a thousand bushels, just as well as it can with more, and the services that will be rendered by these men are sure and quick, and I am sure entirely satisfactorily to all parties concerned.

Now, I am not a member of the chamber of commerce; I am not a member of the board of trade, but I am interested in seeing a fair deal and a square deal consummated to all parties, and I have come

before this committee and made these statements because I believed that it might be of some value to the members of this committee, as it appears from the farmer's standpoint.

STATEMENT OF G. F. EWE, OF MINNEAPOLIS, MINN.

Mr. EwE. Mr. Chairman, I am here in behalf of the Minneapolis Chamber of Commerce, of which I have been a member for a good many years. At one time I was the president of the Minneapolis Chamber of Commerce, and I come here for the purpose of trying to throw some light upon this question which is before you for consideration.

The resolution introduced for consideration by this committee. implies that there is a monopolistic condition existing in the grain trade in the Northwest, and I want to say that my many years of experience in the grain business, extending over a period of 35 years, having followed all branches of the grain trade, including the cash grain business, convinces me that such a condition does absolutely not exist, and can not exist by virtue of the conditions and facts that we have furnished here.

We have a great number of elevators in the country, far in excess of those required to handle the crop, and the result is that there is the keenest competition existing between the elevators who buy grain from the producers. And as indicated by the report of the Department of Labor, which has been referred to in the matter this morning, the 3-cent margin mentioned by that report is about in accord with our actual results in our relations with the farmer in the handling of his grain through these elevators. This margin, it must be borne in mind, is not the net margin per bushel, but is the gross margin out of which must come the cost of operation of these elevators, the cost of interest, insurance, and so forth, so that the net results to the man that handles these country elevators, with all the protection, all the safeguards he can throw around himself, leaves his profits not to exceed possibly 1 cent a bushel. These elevators are not only actually competitive among themselves, but representing as they do line elevator companies, independent elevator companies, farmers' elevator companies, and local organizations, which are created for that purpose, they are also under the jurisdiction of the railroad and warehouse commission which makes such rules and regulations for safeguards for the producer in the conduct of these elevators, and they have got to give bond to the State of Minnesota to indemnify the producer against any loss. They also fix the maximum charge that can be exacted from the producer in handling the grain from his wagon to the car, and for the storing of this grain for the producer until such time as he may elect to sell it. And we have to give bonds to indemnify the producer against loss by fire and also against loss by financial difficulties.

The grain passes from these elevators to the open market, the Minneapolis and Duluth markets, where it is exhibited on the exchange floor for sale to all the buyers that congregate there, perhaps 25 or 30 in number, and representing as they do local mills in the Minneapolis market, as well as millers in other markets and cities, and including exporters, so that there is at all times the keenest competition that it is possible to have in any market in the land.

A great deal has been said about the mixing of grain in our elevators before I touch upon that I want to make mention of the fact that the inspections of grain as it comes into the Minneapolis and Duluth market is by the State inspection department, which is created by the railroad and warehouse commission under a statute for that purpose. These men are the only men that inspect this grain, the only n.en that have access to the cars containing this grain. They do not know who shipped it, or to whom it is shipped, and the grain is inspected under the rules and regulations laid down by the railroad and warehouse commission, and created for that purpose. After the grain is unloaded at the mill or elevator to which it is to go, it is weighed by the State weighman, appointed and created by the railroad and warehouse commission for the purpose of obtaining the actual contents of the car. Now, to say that there is collusion, or to say that there is the least bit of influence exercised between the grain men and the inspection department is absolutely without foundation.

Mr. SIMPSON. How much of the grain that comes into the Minneapolis market is owned by farmers, and how much is owned by the elevators?

Mr. EwE. There have been some figures made on this question, Mr. Simpson, and, as I remember it, it was shown that the farmers severed the relations with the grain when he markets it to the local elevator man to the extent of about 95 per cent of the production of the country. So that of the grain that leaves the farm 95 per cent is not such grain as the farmer has any further interest in when it arrives at the market. And I want to say in that connection that it was shown by the Senate investigating committee, that has been referred to on several occasions, that invariably and without exception the grade placed upon the grain bought from the farmers by the country elevator men and the grade received for the same grain at the terminal is in favor of the farmer as compared with the grading of the same grain at the terminals.

You understand these country elevators have to make a report to the railroad and warehouse commission every year showing the grades placed on grain they receive from the farmers and the grades received for the same grain at the terminals.

I simply cite this to show that there could not be any colusion, that the competition is the very keenest, and that the business could not be conducted on more economical lines than it is being conducted.

Now, as to the mixing of grain. A great deal has been said to indicate that the farming interest is being imposed upon because the mixing of grain is allowed at terminals. I have already shown, gentlemen, that 95 per cent of the grain that comes into the terminals is grain that the farmer has lost interest in. It is owned by the country elevators, and the question of what it brings at the terminal can not affect the farmer. The terminal elevator man is in constant competition with the mills for this wheat, and he is forced by virtue of conditions to take everything into consideration, including the mixing, when he makes his initial purchase. In other words, if he has got to pay expenses, including 2 cents a bushel for carriage, and he can, by securing the wheat at a discount sufficient to justify it, clean it and treat it and remove the obnoxious features and produce a grade of wheat that will grade higher, by so doing he will possibly eke out a