Country elevators charge two cents a bushel for storage during the first 15 days and 1/2 cent for each additional 15 days. The charge for storage at terminal elevators for the first 15 days is 3/4 cent. The farmer may thus store his wheat in an elevator in place of his farm if he chooses so to do, although the wheat he thus puts in storage may have been made into flour and consumed before he sells it. This may be looked upon as a sort of intermediary step between storing wheat in ones own granary and dealing in futures.
The country shipper pays 1/2 cent a bushel commission for the sale of wheat. There is also a charge for inspection and insurance, and, in case there is an advance payment, for interest. After five days there are storage charges. This has given rise to the expression, gilt edge, regular and short receipts, depending upon the length of time there remains before storage charges must be paid. Every market has a grade known as contract grade, meaning the quality that must be furnished when wheat or other grain is sold without specifying the grade. In Chicago No. 2 red winter wheat is the contract grade. Where grain is sold or purchased by a broker, the brokerage is usually 1/8 cent per bushel.
HAY MARKETS
At least twenty cities have adopted the rules of the National hay association as to classes and grades of hay and straw. The southern states constitute an important market for the hay of the north central states, while Boston, New York and the mining towns of Pennsylvania are important markets for the northeastern states. The size of bale varies from 75 to 200 pounds. Small bales of 100 pounds each are preferred in Baltimore, medium bales of 110 to 140 pounds in Philadelphia, while New York and Boston usually deal in the larger bales. The commission charges vary from 50 cents to $1 per car. In New York, $1 pays all charges. At Chicago, $3 per car has been charged for the inspection, divided equally between seller and buyer.
PRODUCE MARKETS
Every town of any consequence has its produce market. The South Water street district in Chicago and the West Washington street market in New York are noted for their extent and variety. There are also many special markets for certain classes of produce. Thus Elgin, Chicago and New York have butter exchanges. Wisconsin, Utica, Watertown and Cuba (New York) maintain exchanges where cheese is placed on sale each week during the manufacturing season. There is also a board of trade for cheese in New York City. The prices quoted upon these exchanges are made the basis of many transactions between buyer and seller, who never enter these markets. Not only do buyers and sellers agree to abide by the quotations of one or the other of these markets, but the quotations are also used as a basis of settlement for milk furnished the creamery or factory. These agencies are thus impartial arbiters in countless financial transactions.
The rate of commission varies in different markets and for different products. Generally, however, produce is handled on a 5% basis, but for individual products which are especially bulky and difficult to handle, such as cabbage, 10% may be charged. In some cases commission is by quantity instead of on a percentage basis. Thus for potatoes the commission is sometimes 10% and in other cases 4 or 5 cents a bushel.
LIVE STOCK MARKETS
While poultry and game, as well as the carcasses of the smaller animals, may be handled through the produce markets, the large animals require separate facilities. The United States is noted for its large live stock markets and for the perfection and size of the packing houses which have grown up about them. The most famous example of these combined agencies is to be found at Chicago, but important live stock markets are also maintained at St. Louis, Kansas City, Omaha, Pittsburgh, Buffalo and more recently Fort Worth, Texas. The commission charges vary from 50 cents to $1 per head for cattle and from 10 to 25 cents per head for calves, sheep and hogs. In some markets, the commission on hogs is 2% of the gross returns. When located within 150 miles of a central market, it is customary to allow 50 cents per hundred pounds for cattle and 40 cents for hogs to cover shrinkage, and cost of freight, yardage, food, bedding and commission. It is possible for an owner to sell his own live stock in these yards, but the commission man, because of his superior knowledge of existing trade conditions, is almost universally employed. Firms which handle cattle, sheep and hogs seldom sell horses. Although handled by different commission firms, important horse markets are maintained at Chicago and Buffalo immediately adjacent to the market for meat animals. In New York the horse markets are in a different section of the city, that for draft and common work horses on one street, while the American Horse Exchange, located at another point, handles high-class light horses. The usual custom is to sell horses at auction, although they may be purchased at private treaty. In whatever manner purchased, it is essential to understand precisely the character of the guarantee.
COTTON, WOOL AND TOBACCO MARKETS