In arriving at this figure a local elevator margin of 7 cents per bushel was deducted. Analysis of operating costs per bushel indicates, however, that the average cost of handling grain for the group studied was 4.46 cents per bushel or 2.54 cents lower than the figure deducted for that purpose. Wherever farmers delivered to cooperative elevators whose handling costs were lower than the 7 cents per bushel deducted in obtaining the average, some further credit would accrue to the patron in addition to the average price per bushel as shown.

Altogether the 1925-26 season, especially regarding supply of high-protein wheat, presented a considerably different market situation than the one that prevailed in 1924-25. Premiums for high protein wheat were therefore lower. On the other hand, supplies of high-test weight wheat were smaller for the 1925 crop than for the 1924 crop. For that reason premiums paid for test weight increased throughout the period. Effect of dockage on premiums was not analyzed for the 1924 crop, but the results of the 1825-26 analysis indicate clearly that, for the 1925 crop at least, dockage tended to decrease the premiums paid for wheat at the terminal markets. For the spring-wheat area as a whole, premiums received during 1925-26 depended largely upon the factors of test weight and protein content and so varied considerably between sections of the area. Resulting gross and net prices varied because of these two factors and because of the time of sale and the cost of marketing.

STATEMENT OF CONGRESSMAN O. B. BURTNESS, OF NORTH DAKOTA, BY WAY OF REBUTTAL

Mr. BURTNESS. I desire to make a few comments and observations with reference to the opposition that has been presented against this proposed legislation, and also with reference to the splendid information which has been submitted by the Department of Agriculture, but I will try to make my statement as brief as possible.

First, let me say that I am pleased at the fact that the policy embodied in my legislation has drawn so little fire. The information presented by Colonel Wilkinson does not, as I see it, in any way present any grounds for objecting to this type of legislation

In fact,

I am in absolute accord with more than 90 per cent of what Colonel Wilkinson said to you. His time was taken up not in trying to show you how this legislation would work, or objections thereto, but rather in showing how the Minnesota inspection department and its State laboratory is conducting its work.

If in my presentation on behalf of the bill, I did or said anything which would justify Colonel Wilkinson in reaching a conclusion that the Minnesota department was in any way on trial, I want to disabuse your minds of any such intent on my part. I know that the work done by the Minnesota commission, the law passed by the State of Minnesota requiring every car to be tested for protein content, and the work done in any of the States of the Union, which has tended to advise producers and the public generally that protein content is probably the most important factor in determining the milling value of wheat, have all been of very substantial help.

With the development of interest in the subject and with the experience which we have gained from year to year, we find, however, that possibly something further can be toward attaining the general object of having the protein premium reflected in every case back to the individual farmer who actually grows the protein in the wheat. Aside from that, we have shown the actual situation which now exists.

We have shown by specific evidence the difficulties confronting an individual like Mr. Fahey, representing the North Dakota Wheat Growers' Association, who has wheat to sell, in that he can not specifi

cally rely upon the information given him in any certificate which he may now obtain from protein laboratories, be they State or private. Something seems to be wrong somewhere, but it is not easy to put one's finger upon the exact difficulty. We do know that regardless of what boasting Colonel Wilkinson may do on behalf of the Minnesota State laboratory, and regardless of what Mr. Scott may say on behalf of the laboratory conducted by the State of Wisconsin, the fact is that official samples tested for protein in the two laboratories of these States show widely varying results.

You will recall that I asked Colonel Wilkinson, not once but three times, whether, if Doctor Benton's testimony showing that 320 carloads of wheat, owned by the Farmers' Union, had been tested at these two laboratories with discrepancies ranging from one-half of 1 per cent to 134 per cent in protein content is correct, whether such a situation can be satisfactory, either to the producers, the elevator men, the buyers, the grain trade, or any one else, and that Colonel Wilkinson utterly failed to answer it. Of course, the answer was obvious. If the present situation were satisfactory we would not be here. On the other hand, it is highly unsatisfactory to producers, grain dealers, and millers alike.

The material presented by the Department of Agriculture thoroughly disposes of the claim made by Colonel Wilkinson to the effect that it would not do for a country elevator manager to take a sample out of each load as the load is brought in by the farmer, and then mix those samples thoroughly so as to get a composite sample fairly representing the average of the wheat delivered by the farmer. The department's investigations show that it can not only be done but that it is being done, and that the practice is increasing. I have used this plan myself and know how it works.

To even a greater degree does the information furnished by the department dispose of Colonel Wilkinson's outstanding recommendation that in order to solve this problem samples should be taken from one marketing point, and that all of the producers of grain at such marketing point should be paid for on the average results of those samples. I gathered the impression that this suggestion, when first made by the colonel, appealed to some of the members of the committee and naturally to those not particularly familiar with the vagaries of protein content the suggestion was plausible.

It was, however, nothing new. It has been tried more or less for years, and the longer it has been tried the more definitely has the unfairness thereof been established. The tables furnished by the department for these hearings show, for instance, that the variation in the protein content of wheat delivered at one station in northeastern Montana amounted to as much as 8.25 per cent. This means that the grower of the highest protein-content wheat produced a product worth probably from 50 to 80 cents per bushel more than that of another farmer marketing his wheat at the same market point, but who raised the lowest protein-content wheat. The station which I refer is the one designated as station No. 11, in eastern Montana.

But let us take another typical case from the department's records. Station No. 38, in southeastern North Dakota, showed a range of wagon-load tests from 10.60 per cent to 14.75 per cent, a little more than one-half as large as the range at the Montana station. These

tests are from 70 growers. Assuming protein premiums payable at any given time were substantially as they were during the threshing season in the fall of 1928, the last time when I marketed any wheat, we would have the wheat testing 14.75 per cent protein worth at least 30 cents per bushel more than the wheat raised at the same marketing point which tested below 11 per cent protein.

Just as I said in reply to a question asked by Mr. Adkins, following the close of Colonel Wilkinson's testimony, the pooling of protein would be no different, in principle, from the pooling of grades at any one market point. Of course, the information furnished by the department thoroughly substantiates my position in that regard. In fact, it would seem that there is more likelihood of being wider variations in values of different loads of wheat marketed at one station on account of their respective protein content than there is likely to be on account of the wheat falling into different grades, because of weight test, inseparable dockage, or some such factor.

Let me repeat that it is my purpose to provide a plan that will pay each producer the full value of wheat which he raises and not to follow Colonel Wilkinson's suggestion to simply average up values among all producers at any one given station. I want to encourage good farming methods, methods that will produce high protein wheat; while his suggestion would rather tend to encourage slipshod methods, for the producer would figure that regardless of the quality of his wheat he would be paid for the average of his station.

We are indebted to Colonel Wilkinson for the clear and interesting description which he gave us all as to how sampling and inspection of wheat is now being done in the Minnesota terminals. We all profited by it, and, with his magnetic personality, he kept us interested while explaining the various steps. I hope, however, that none of you were so charmed by his presentation in that respect that you failed to note that he made no argument against this bill. This was noted by my good friend, and one of the active members of this committee, Mr. Andreson, who as a Congressman from Minnesota, sponsored the opposition to this bill. Mr. Andreson, with his keen mind sensing the situation, came to the rescue, and before Colonel Wilkinson was permitted to close his testimony asked the latter whether this proposed legislation would be helpful in solving the protein problems and in getting the premiums reflected back to the producers. Then with considerable emphasis Colonel Wilkinson gave his positive opinion that it would not, but he failed otherwise to attempt to give a reason for that opinion.

It is for you, members of the committee, to determine for yourselves how much weight should be attached to his opinion, but, knowing Members of Congress generally, and members of this committee, as I think I do, I feel confident in saying that all of you are more interested in finding out the reason why any witness believes legislation will or will not work than in simply getting their conclusions or opinions.

The opposition to this bill can all be traced to one source, and that is to the men conducting State laboratories, who, for some reason or another, do not desire their work to be supervised by a Federal agency. The only witnesses who have appeared before you in opposition to the bill are representatives from such laboratories. I assume some of you may have received letters or telegrams from

others in opposition, but I feel justified in making the assertion that those telegrams and letters have been the result of propaganda eminating from the Minnesota Grain and Warehouse Commission.

In a State like ours, North Dakota, raising about six times as much wheat as Minnesota but knowing that the wheat must be sold in the terminals of Minnesota, we can't help but feel that if it is right to have Federal supervision of the grading of grain that it would also be right to have Federal supervision of the determination of protein content, for the latter factor is of more importance in determining the milling value of our wheat than any one factor which enters into the grading system. We are not charging the management of the State laboratories or the commercial laboratories with crookedness or anything of that sort. We have shown the difficulties with which we are confronted, and which have not been denied or satisfactorily explained. We know that the wheat from our State and almost all the wheat raised in the other great wheat States of the Union enters into interstate commerce. We know it is the solemn duty of Congress to regulate, to protect, to facilitate interstate commerce, and we feel we need offer no apology when we suggest that it would be better for us if there were a Federal agency having general supervision.

We especially emphasize that this is the logical thing to do and that it involves no new step in principle. We have Federal supervision of grades; when disputes arise appeals may be taken to a Federal agency. This is all we are asking for now with reference to protein content. If Congress and the country had known as much about protein in 1916 when the grain standards act was passed, as it does now, is there any one who would say that Congress would then have passed the grain standards act without including supervision over protein? In other words, my proposal is simply a natural extension of present legislation to include one other factor in connection with wheat marketing, and that factor is the most important of all in establishing the actual milling value of wheat.

Before closing, I desire also to make a few brief comments with reference to the more specific suggestions made by Mr. Olsen, Chief of the Bureau of Agricultural Economics, as to immediate legislation that might be enacted.

I am confident that the members of the committee have been tremendously interested, as I have been, in the information which the department has presented. I have already shown how conclusively its investigation disposes of the suggestion made by Colonel Wilkinson, that the wheat from any one market point can or should be paid for upon the average protein content of the grain marketed at that particular point. The charts presented by the department also show very clearly how the actual value of the protein varies from season to season, dependent upon the ordinary laws of supply and demand. In years of high protein content in the crop, small premiums prevail, while in years of low protein content, we inevitably see the premiums mount to a considerable figure.

Naturally the premiums operate behind the tariff wall, and inasmuch as Canadian wheat is rather uniformly of a high protein content, the maximum premium is pretty well limited by the tariff duty. However, so long as we have a substantial import duty we can expect substantial premiums in most seasons.

I agree thoroughly with the department that it is very important to ascertain as early as possible, in any marketing season, what the protein content of that season's crop is likely to be. Definite ascertainment of such facts would largely do away with the fluctuations of protein premiums for that season. This would be fair to the producers generally, and would also take away some of the hazards in the grain trade to which I have adverted.

If the trade could be assured that the premiums could not fluctuate appreciably, the entire amount of premiums paid at the terminals would be more likely to be reflected back to the individual farmer who sells his wheat by the wagonload or the truck load to the local elevator. A smaller margin on which to operate would be required.

On the other hand, I realize the difficulties that would be involved, due to the fact that wheat starts moving in Oklahoma and southern Kansas in June, at a time when our spring wheat in the Northwest is not even headed out. Ordinarily our wheat is harvested in the early part of August. Sometimes a little cutting is done in July, and in other years practically no cutting is done until the middle of August. Naturally the millers or the grain trade will not, even with thorough investigations, know just what they can rely upon, in so far as protein is concerned, until in August, and only from then on could we with any assurance rely upon any reasonable stability of protein premiums. I fear, therefore, that it would be impossible to do fully what the department hopes, but I do not mean to imply that every reasonable effort should be attempted to bring such results about.

Entertaining these views, I am naturally not opposing the suggestion that the department might set up laboratories to assist in gathering such information. Personally, I am perfectly willing that they should do so, and I can't help but feel that the appeal laboratories which my bill provides for, could, in the early part of the season, be engaged in doing that very work. I present that suggestion seriously to this committee for its careful consideration. Why not kill two birds with one stone?

I believe we all realize the general opposition which exists throughout the country against the Government entering into any business in direct competition with private industry. My Bill was drawn on the theory that no such direct competition would result, except to the extent necessary for safeguarding the interests of the producers. If Government laboratories are established for the purpose of making sufficient tests at the beginning of the season, so that there may be a complete survey of the protein situation for that particular year, it would be very well to consider whether those laboratories could not also serve a proper function for the balance of the year, for the overhead expense would be almost the same whether they were actually operating 12 months of the year or were lying more or less idle nine months of the year. Why not let those very laboratories operate at the same time and during the balance of the year for the purpose of determining appeals, that might be taken from any commercial or state laboratories? If the Government laboratories should after completion of the survey operate simply in competition with private laboratories, and thus bid for work generally, they would enter into direct competition with our private and State laboratories, and would be very much opposed by many people.

On the other hand, if such government laboratories should serve the purpose suggested by Mr. Olsen, in making a survey and disclosing