the unification of the activities of existing cooperative marketing associations in these States. The board assisted in the establishment of a sour-cherry marketing association in northern Michigan whose activities will be closely correlated with the organization in Wisconsin. Loans have been made to the Fruit Growers Union Cooperative) to acquire canneries in Michigan as well as to enlarge the existing Wisconsin plants. It has also assisted a number of small southern Michigan associations in the formation of a single large association to handle deciduous fruits of that region, and has assured them of financial assistance if the new organization when completed meets with the board's approval.

In the Northeastern States the board has found that a large number of small cooperative associations are engaged in the marketing of a wide variety of products under varying conditions and without attempt at coordination of effort. Before undertaking to develop a program for the extension of cooperative activities in these States, the board felt it necessary to obtain further information concerning the existing associations. Accordingly, it is financing a survey of all cooperative marketing associations in the 12 northeastern States in cooperation with the State agricultural colleges in that region. With the information which is to be obtained from this inventory of cooperative effort, it is hoped that plans for further development may be made most successfully.

PECAN GROWERS' ORGANIZATIONS

For a number of years past, efforts have been made by various interested groups to develop some sort of growers' marketing organization in the pecan industry. Prior to 1930, two pecan growers' cooperative associations had established marketing facilities and a third growers' organization, not a cooperative, had also engaged in marketing this product. Shortly after the board's organization, representatives of the industry requested that a study be made by the board with a view to suggesting a satisfactory plan for the unified marketing of pecans.

As a result of the study, which was conducted by members of the division of cooperative marketing, a meeting of some 75 representatives of all sections of the pecan growing belt was held, at which a committee was appointed to undertake the formation of a national marketing organization. This led to the organization of the National Pecan Marketing Association. As there has been little cooperative organization in this industry prior to the formation of the national association-the existing cooperatives having handled approximately 17 per cent of the improved varieties, which is equivalent to about 5 per cent of all varieties of pecans produced-the new

association is devoting its attention first to assisting producers in the organization of local associations throughout the pecan belt.11

11

It is contemplated that the national association will act primarily as a sales agency, but that it will also supervise grading on the part of its member local associations.

TOBACCO MARKETING ASSOCIATIONS

When the Federal Farm Board undertook its duties in July, 1929. there were only two cooperative tobacco marketing associations in operation in the United States. These were the Northern Wisconsin Cooperative Tobacco Pool and the Maryland Tobacco Growers Association. The Wisconsin association was organized in 1922 and has been in active operation since that time. The Maryland association was organized in 1919 and is still operating. The board, after investigation of this association, made a substantial loan to it for the expansion of its activities in the effective merchandising of its members' tobacco.12

Shortly after the organization of the board, a movement developed among the growers of flue-cured tobacco in North Carolina, South Carolina, and Virginia for the formation of a cooperative tobacco association. This movement gained headway first in South Carolina, where the growers elected an organization committee in November, 1929. The board assisted this committee in the preparation of a contract and plans for the organization. By April 1, 1930, a sufficient quantity of tobacco had been pledged by the South Carolina growers to enable the committee to organize the association. The South Carolina Tobacco Growers Marketing Association is in position to handle the 1930 crop for its members.18

The board made substantial loans to this association for operating expenses and for advances to its members at the time of delivery. The loans on this tobacco are supplementary to loans obtained from commercial banks.

The situation in North Carolina and Virginia indicated the need for further education in the possibilities and limitations of cooperative marketing of tobacco and, accordingly, the board joined with the extension forces of these States in conducting a series of educational meetings. Subsequently the growers in Virginia decided to set up a cooperative tobacco marketing association. They elected two organization committees, one for the bright tobacco area and

11 The board has granted the National Pecan Marketing Association a small loan to assist it in financing the development of this program, prior to receipt of the 1930 crop. The national association now has 18 member locals in 10 States.

12 This loan had been repaid in full at the time this report was completed.

13 The association had, by Nov. 1, 1930, received from its members approximately 16,000,000 pounds of tobacco.

one for the dark-fired tobacco area. Both of these organization committees prepared contracts and outlined plans for the proposed association, with the assistance of the board. Each of these committees is conducting an active campaign for signatures to the contract, which will be effective, if sufficient volume is signed, for the 1931 crop.

14

In North Carolina a similar educational program was undertaken; the board and the extension service are cooperating in this work.

In Georgia a movement has likewise been started for organization of the tobacco growers.

A similar movement to organize the tobacco growers of Tennessee started some months ago at Springfield, Tenn. A number of meetings have been held in that territory, at which board representatives were present. Leaders in that territory are now working on a plan to organize an association for the growers of dark-fired tobacco in Tennessee and western Kentucky. They have sought the assistance of the board and of the extension services of Tennessee and Kentucky. The board, cooperating with the two extension departments, has been working with these leaders on a contract and plan for the proposed association.

The Burley tobacco growers of Kentucky and adjoining States are in a position where they could again start the operation of the Burley Tobacco Growers Cooperative Association quickly, because that association is still in existence. It has a board of directors, an office building, a cash reserve, and warehouse facilities which are available from the district warehousing corporations that are owned by the members of the Burley association. The directors of the Burley association have sought the assistance and advice of the board and representatives of the board have met with those directors.

SUGAR BEET GROWERS ORGANIZE

Sugar beet growers have been endeavoring to perfect an organization for the purpose of encouraging better methods of production and distribution. It is proposed that this organization will work closely with the manufacturer to the end that both the producer and the processor will receive a fair income. The organization also contemplates working with producers of cane sugar to eliminate, in so

14 Before this educational program was completed in North Carolina, markets for the 1930 crop opened at prices that were unsatisfactory to the growers. This resulted in a movement in that State for organization of a cooperative association. Following several large mass meetings in the State, committees were elected by the growers to prepare a contract and plans for an association. Two committees were elected, one for the eastern section and one for the western section, or "old belt," of North Carolina. Each committee proposes to organize a separate association. Both of these proposed associations in North Carolina contemplate beginning operation with the 1931 crop.

far as possible, cross hauls and other uneconomical factors in sugar distribution. This should benefit both producers and consumers. The first meeting looking toward such an organization was held at Denver, Colo., late in June and a member of the board was present to advise with the growers in making the preliminary set-up.15

RICE GROWERS' COOPERATIVE ASSOCIATION

The board has given much attention to the problems of the rice growers. Loans have been made to rice cooperatives in California, Arkansas, Louisiana, and Texas, and a survey has been made looking toward the formation of a regional association in the ArkansasLouisiana-Texas area. A number of conferences have been held in the latter rice territory and the growers there are now developing their regional cooperative program.

OTHER COOPERATIVE MARKETING ACTIVITIES

In the foregoing paragraphs have been detailed the activities of the board primarily directed toward the development of a permanent system of farmer-owned and controlled cooperative-marketing associations, for most of the agricultural products of major importance. In addition to the work involved in these industry programs, the board has been carrying on a variety of activities for the benefit of specific associations. The staff of the division of cooperative marketing has been constantly occupied in analyzing the business problems of individual cooperative associations and making suggestions as to beneficial changes in their policies and marketing practices. Representatives of this division have also assisted a number of associations in planning and carrying out their educational campaigns for increased membership. The work has been conducted both with large organizations handling products which have been the subject of the board's consideration in the development of a permanent program of expansion, and with associations marketing farm products which are of less importance in value of product.

In addition to the loans which have been mentioned in connection with the industry programs described, the board has made similar loans to cooperative associations engaged in the marketing of poultry and eggs, turkeys, walnuts, honey, seeds, canned fruits, and truck crops.

15 On Aug. 2, 1930, representatives of sugar beet growers from the 17 sugar-beet producing States met in Greeley, Colo., and developed a national cooperative program for their product. At this meeting the National Beet Growers' Association was formed. It was incorporated on August 13. Also an advisory committee for sugar beets and sugar cane was selected. The purpose of this move was to take advantage of the clearing-house provisions (sec. 10) of the act, so that growers and processors of sugar beets and sugar cane might effect a more efficient system of marketing beet and cane sugar.

SURPLUS CONTROL MEASURES, INCLUDING STABILIZATION

OPERATIONS

Measures for surplus control and prevention, including what may be termed "stabilization operations," appear in the agricultural marketing act second in importance only to measures for building up effective cooperative marketing associations, and are closely linked with them.

* *

One of the stated major objectives of the act is "to protect, control, and stabilize the currents of interstate and foreign commerce in the marketing of agricultural commodities and their food products The Federal Farm Board is charged with the task of aiding in preventing and controlling surpluses in any agricultural commodity, through orderly production and distribution, so as to maintain advantageous domestic markets and prevent such surpluses from causing undue and excessive fluctuations or depressions in prices for the commodity." Provision is made for resort to stabilization corporations when the board and the advisory commodity committee consider that this special machinery is necessary. In section 5 the board is authorized and directed "to investigate conditions of overproduction of agricultural commodities and advise as to the prevention of such overproduction."

The problem of agricultural surpluses and instability is not new. In recent years it has been the subject of continuous discussion, and many schemes for solving it have been proposed.

The end sought by Congress, as the board interprets it, is to moderate or eliminate "undue and excessive" fluctuations in prices, such as tend to injure the farmer-producer; and to moderate or eliminate the causes of such "undue and excessive" fluctuations. Not stabilization, in the sense of rigid fixation or leveling of prices, but stabilizing, in the sense of limiting fluctuations and cushioning the shocks from severe fluctuations, is regarded as the objective. Even this end is to be sought only in so far as it promises real benefit to farmers, not only for the time being but over a period of years.

Congress avoided imposing upon the board any particular scheme or schemes—rather it gave authority for the employment of certain methods and machinery, to be used at the board's discretion. The board has, however, interpreted the act to mean that Congress counts upon the board not merely to study the problem but to act with vigor when conditions appear to demand action, even at the risk of loss to the revolving fund; and to develop through experience the methods best calculated to attain the objectives of the act.

The board recognizes four principal groups of stabilizing measures. In the first place, it conceives that the normal development of cooperative marketing associations should contribute appreciably toward