The Harvester World: Volume 2, number 12, September 1911

              The Harvester World

Sisal

Standard Sisal
Stundard Manila
Manila
make the twine smooth, and protect it from the elements and insects. The International twine contains less oil than was used by the Deering and Osborne Companies when they operated those plants. The usual amount is 15 per cent, but fully one-third of this disappears in the process of making, so that the finished twine has less than 10 per cent of oil, instead of 18 per cent as charged. The wholesale prices of binder twine, f. o. b. factory, for the last ten 3'ears are as follows, carload lots being Jc. less: (From official "Cordage Trade Journal")
Pure Manila
1902  11 11 nH. Vi'A 15
1903- ¦  lOH lOH IIH 12 13
1904  lOhf lOK WM, i2H laa
1905   10 10 11 IS iS'A
1906    10 10 11 12 13
1907      9« 9% -- 12!^ 14
1908      HH        SH .. IM 13
1909      7H 7H -. 8^ 10
1910 1911
Thus, since the International entered the twine trade, the prices have steadily fallen; the wholesale price of sisal twine has fallen from 11 cents to 6i cents a pound, and of manila from 13i cents to 7i cents a pound.
(f) Manttfacture of New Lines. An investigator must be hostile indeed, when, in pursuit of restraints of competition, he complains of an increase oi coxa^^XxM^aw in other lines of agricultural implements. Yet that is precisely what the Report does. Although the Inter¬ national purchased plants which manufactured only binders, reapers, mowers, corn harvesters, buskers and shredders, and rakes, it had the hardihood to disregard the Report's classification of agricultural implements, and to engage "in making cultivators, harrows, manure spreaders, wagons, cream separators, gasoline engines and various other implements, in addition to harvesting machinery (pp. 836, 837).
It is as guilty when it increases the competition as ¦vi\i&a\\. lessens \.i—because the investigator is satisfied that the company's purpose is to monopolize the market "in everything that the farmer buys."
What are the facts? This company has gone into the manufacture of these new lines for the purpose of keeping its factories busy all the year'round, and for the purpose of furnishing to the International "of America" articles that will have a twelve months' selling season. But in not one of these new lines has it monopolized or attempted to monopolize the market. In not one of them docs it mam<facture more than 40 per cent of those made in the United States, and in most of them it makes less than 25 per cent: and the average of its share in the total output of agricultural implements in the United States, in the lines made by it (excepting binders, reapers and mowers) is not over 25per cent.
{g) Effect Upon Prices. The report charges that prices have been largely increased, the retail prices rigidly fixed, terms made less liberal, facilities of distribution impaired, and that the prices charged are excessive (pp. 837-839). These very important statements are all and each demonstrably erroneous.
The facts are these: Prior to the organization of the International, all harvester companies sold binders, mowers, and other harvesting tools on commission, and they  naturally  fixed the  prices at  which   their
agents should sell. The agency contracts required sales to be made at such prices, and forbade the agents to sell the goods of any competitor.
But the International agency contracts have con¬ tained neither provision since 1905, nor were they enforced before that time. Its contracts fix only the net price, at which the agent has to account for the machines when sold. The selling prices are fixed freely by the agent, exactly as every merchant fixes the price of his commodities.
Now, as then, machines are sold on liberal terms of credit, with a less price for cash than on time. Now, as then, expert services are freely furnished. And the facilities of distribution — general agencies, ware¬ houses, transfer houses, and local agencies—are much more numerous now than then. The statement that the company " fixes an invariable price at which the machine shall be sold by local dealers" is not true in fact or in effect. The prices to the farmers of binders and mowers are no more uniform than the prices of sugar, salt, and flour to the farmers, or than of butter, wheat, and corn when sold by the farmers.
The influence of the International Harvester Com¬ pany on prices of harvesting machinery has been to prevent increases rather than to cause them. During the period 1902 to 1907 the prices of steel and iron and hard and soft wood, which entered so largely into the production of these machines, had increased on the average more than 30 jjer cent, and the wages of labor employed in its factories had increased fully 17 per cent.* Yet during that period there was no increase in the prices of these necessary machines. They contin¬ ued as low as during the intense and bitter "harvester war."
*The precise figures are as follows:
Mnterials
Pia Iron;
No. 2 Foundry Iron	
Malleable llessetner	
Steel	
LUMBEB
Yellow Pine Polo Stock	
Hardwoods	
Cratine -	
Cotton Duck  	
Wages
Average   wage   per   hour,   com
bining time and piece work -
1901-2
Contract
Prices
$13.50 ton 14.50 ton 1.35 cwt.
26.00 per M.
25.50 per M.
9.00 per M.
.27 yard
1902 19.4 cents
1907
Contract
Prices
120.76 ton 21.40 ton 1.665 cwt.
37.50 per M.
37.50 per M.
15.00 per M.
.365 yard
1907
iDoreue
53.7% 47.6% 23.3%
44.2% 47.0% 66.6% 35.1% Inorease
The only increase was first made for the season of 1908, and amounted to only 7 per cent. During that same period, igo2 to igoS, the prices of other agri¬ cultural implements, which the International did not manufacture, had increased from 75 to 20 per cent — as every large farmer and implement dealer knows. Although the cost of labor is still over 26% higher than in 1902, the material costs have mate¬ rially lessened in the past two years (though still above those of 1902), and the compf.ny has announced a corresponding reduction of about 5% in harvester prices for 1912.
If the investigator could not discover the well- known and widely published market prices of these machines, he certainly could not learn the private figures of thq individual businesses of harvester com¬ panies during the period 1879 to 1902. His state¬ ments upon that subject and upon the cost of pro¬ duction are imaginary.