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HISTORY and DEVELOPMENT of AGRICULTURAL COOPERATIVES in OHIO DISSERTATION Presented in Partial Fulfillment of the Requirements F

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HISTORY AND DEVELOPMENT OF AGRICULTURAL
COOPERATIVES IN OHIO

DISSERTATION
Presented in Partial Fulfillment of the Requirements for the Degree Doctor of Philosophy in the
Graduate School of The Ohio State
University

By
WILLIAM TAFT RICHIE, B. S., M. S.

The Ohio State University
1958

Approved by:
Adviser
Department of Agricultural
Economics and Rural Sociology
ACKNOWLEDGMENTS
I am grateful to all the people who have helped to make this manuscript possible. A special word of appre- ciation goes to Dr. George P. Henning, of the Department of Agricultural Economics and Rural Sociology, for his guidance and supervision. I also wish to thank Dr. Ralph W. Sherman and Dr. Virgil R. Wertz for their suggestions and assistance.
My wife, Sadie, has been a source of inestimable help and encouragement at all times. To her I am indebted for the typing of this manuscript.

ii
TABLE OF CONTENTS

  • CHAPTER
  • PAGE

  • 1
  • I. INTRODUCTION.................................

Purpose and Scope of Study.............. Previous Studies........
6

  • 8
  • Source of Data

.....................

II. ECONOMIC PRINCIPLES AND CONCEPTS OF

COOPERATIVES................................

10 lk- 21
III. STATE AND FEDERAL LEGISLATIONS.............. IV. DEVELOPMENT OF FARMER COOPERATIVES IN OHIO..
Ohio Farmers Late in Organizing

Cooperatives.............................

22

  • 26
  • Farm Organizations............

Number, Membership and Volume of

Business.................................

39 57 57
V. DAIRY COOPERATIVES...............
Early Developments.......... Some Factors Affecting Development and

Growth...................................

61
Background Information of Some of the

  • Associations Operating in Ohio Milksheds.
  • 67

  • 82
  • Ohio Milk Producers Federation..........

Statistics and Trends in Dairy Coopera-

tives....................................

82

  • 89
  • VI. FRUIT AND VEGETABLE COOPERATIVES............

Development of Fruit Cooperatives in

Ohio.....................................

90 92 96
Development of Vegetable Cooperatives.... Statistics and Trends.................... iii
TABLE OF CONTENTS (Continued)

  • CHAPTER
  • PAGE

99
VII. GRAIN AND FARM SUPPLY COOPERATIVES.......
Early Elevator Cooperatives........... State Organization Formed.......... ... The National Program...................
100 109 113
Central Grain and Purchasing

Organizations.................

116 133 133 l*+0 l*+9 l5*+
VIII. LIVESTOCK COOPERATIVES....................
Early Developments in Ohio............ Local Shipping Associations........... County-Wide Shipping Cooperatives The Need for a State Organization. Cooperative Selling on Terminal

Markets.........

159
The Decline in Shipping Associations

in Ohio............

16*+ 167

Direct Marketing.......................

Consolidation of Cooperative Terminal Sales Agencies and Decentralized

Marketing..............................

V/Q

190 190 19^
IX. POULTRY COOPERATIVES......................

Early Developments.....................

Ohio Farm Bureau Federation........... Auction and Commission Pool

Associations...........................

195 201 20U-

Sales Federation.......................

Statistics of Poultry Cooperatives iv
TABLE OF CONTENTS (Continued)

  • CHAPTER
  • PAGE

208 208 209 220 220
X. TOBACCO COOPERATIVES........................
Early Efforts. ......................... Organization in the Miami Valley.........
XI. WOOL COOPERATIVES...........................
Early Efforts

........

Ohio Wool Growers Cooperative

Association..................

222 232 2*fO
XII. FARMERS1 MUTUAL INSURANCE COMPANIES........ XIII. CREDIT COOPERATIVES.................
The Federal Land Bank and National Farm

Loan Association.........................

2^2 2^6 2*+8 251 256 260 266
The Federal Intermediate Credit Banks.... Credit Subsidiaries of Ohio Cooperatives. Producer Credit Associations............ Bank for Cooperatives....................
XIV. RURAL ELECTRIC COOPERATIVES................ XV. SUMMARY AND APPRAISAL......................

APPENDIX A.............................................

APPENDIX B.............................................

BIBLIOGRAPHY...........................................

AUTOBIOGRAPHY..........................................

278 313 350 358

v
LIST OF TABLES

  • TABLE
  • PAGE

23
1. Index Numbers of Wholesale Prices in the
United States (1860-1900)...................

2. Financial Picture of the Ohio Farm Bureau

  • Cooperative Association,, Inc. (1931+-1956)...
  • 37

3. Number listed of Marketing, Farm Supply, and
Related Service Cooperatives in Ohio

b2

*f. Number of Marketing, Farm Supply, and
Related Service Cooperatives for Each 10,000 Farms in Ohio (1925-1955)...........

5. Number and Estimated Membership of the
Farmers' Marketing Cooperatives in Ohio, By Specified Commodity Groups (195^-55)....
*t3

6. Estimated Business in Specified Commodity
Groups of Marketing Cooperatives in

Ohio (195^-55)..............................

*+5 ^6
7. Estimated Business of Farm Supply Cooperatives

in Ohio (195^-55)...........................

8. Estimated Membership of Marketing, Farm
Supply, and Related Service Cooperatives in Ohio for Specified Periods

(1915 to 195*+-55)...........................

50 52
9. Estimated Business of Marketing, Farm Supply, and Related Services in Ohio for Specified Periods (1913 to 195^-55).......

10. Number, Membership and Dollar Volume of Dairy
Cooperatives in Ohio for Specified Periods

(1913 to 195j+-55).........................

85

11. Trends in Dairy Cooperatives (1950 to 195^-55).•

87

12. Number, Estimated Membership and Estimated
Business of Fruits and Vegetables in Ohio for Specified Periods

(1913 to 195^-55)..........................

97 vi
LIST OF TABLES (Continued)

  • TABLE
  • PAGE

98

13. Trends in Fruit and Vegetable Cooperatives
(1950-51 to 195*4-55)......................

I1*-. Data on 217 Farmers' Elevators in Ohio, When

and By Whom Formed (190*f-192*0.......
105

15. Number, Estimated Membership, and Estimated
Business of Grain Cooperatives in Ohio

  • for Specified Periods (1913 to 195*4-55).....
  • Ill

16. Trends in Grain Cooperatives (1950-51 to

195*4-55).....................................

130 132
17. Some Financial Aspects of Ohio Farmers'
Elevators (1933-3*4 to 1953-5*0..............

18. Number, Estimated Membership and Estimated
Business of Cooperatives Marketing Livestock in Ohio for Specified Periods

(1913 to 195*4-55)...................

165 185
19. Producers Livestock Association and Its

Branch Markets 1957..........................

20. Value and Volume of Business of the Producers
Livestock Association, Columbus, Ohio

(1935-1956)..................................

187
21. Number, Membership and Dollar Volume of
Poultry Cooperatives in Ohio for Specified

  • Periods (1925-26 to 195*4-55).................
  • 205

206

22. Trends in Poultry Cooperatives (1950-51 to

195*4-55).....................................

23. Number, Estimated Membership and Estimated
Business of Cooperatives Marketing Wool in Ohio for Specified Periods (1925-26 to

195*4-55).....................................

228

230

2*4. Trends in Wool Cooperatives (1950-51 to

195*4-55).....................................

25. Periods When 102 Farmers' Mutual Insurance
Companies Were Organized in Ohio

(1950 to 1956)...............................

23*4 vii
LIST OF TABLES (Continued)

  • TABLE
  • PAGE

26. Number of Farmers' Mutual Fire Insurance
Companies, Insurance in Force, and

  • Costs in Ohio (1935 to 1955)................
  • 237

2^5 252 255
27. Federal Land Bank Loans Made and Outstanding

in Ohio (1933-1956)..........................

28. Loan Business of the Producers Livestock
Credit Association (1935-1956)..............

29. Production Credit Association Loans Made and
Outstanding in Ohio (193*+-1956).............

30. Number and Amount of Loans Outstanding Made by the Louisville Bank for Cooperatives to Ohio Cooperatives (1935-1956)..,.........
259

265
31. Loans Made and Loans Outstanding by Ohio
Rural Electric Cooperatives (19*+5-1956).....

APPENDIX TABLES

32. Dairy Marketing Cooperatives in Ohio, 1957....... 33. Fruit and Vegetable Cooperatives in Ohio, 1957...
31^

320

3*+. Location of Farmers' Grain Elevator Companies in Ohio Showing Laws and Code Sections Under Which They are Incorporated and

  • Dates of Incorporation, 1957.....
  • 323

33^
35. List of Poultry Cooperatives in Ohio, 1957...... 36. Farmers' Mutual Insurance Associations in

Ohio, 1957...................................

335 3^3
37. Number and Location of National Farm Loan
Associations in Ohio, 1957.......

38. Number and Location of Production Credit

  • Associations in Ohio, 1957...................
  • 3*+5

3^7
39. Rural Electric Cooperatives in Ohio, 1957....... viii
LIST OF FIGURES

  • FIGURE
  • PAGE

*+8
I. Membership in Farmer Cooperatives and
Number of Farms in Ohio, 1925-55.........

II. Net Value of Farm Products Marketed and
Farm Supplies Handled by Ohio Cooperatives, 1930-31 to 195l+-55.........
5^

  • 83
  • III. Location of Dairy Cooperatives in Ohio, 1957...

IV. Location of Fruit and Vegetable Cooperatives in Ohio, 1957..........
9^
V. Location of Farmer Elevators in Ohio, 1957.....
110
VI. Location of Egg and Poultry Cooperatives in

Ohio, 1957.................................

200 235
VII. Location of Farmers' Mutual Insurance
Associations in Ohio, 1957.....

ix
CHAPTER I
INTRODUCTION

Throughout American history farmers have believed that they were victims of monopoly and were exploited by railroads, bankers, farm machinery companies, grain eleva- tors operators, and by others with whom they did business. This was so, they believed, because they produced and sold competitively, whereas the transportation services they used and the manufactured goods they bought were largely monopolized. This feeling, especially by Midwestern farmers, was in part responsible for the early legislation on government regulation of business — the Interstate Commerce Act of 1887 regulating railroads, and the Sherman Antitrust Act of 1890 curbing collusive monopoly and en- forcing competition.
Again in the early twenties and thirties farm senti- ment was largely responsible for legislation enacted to put the farmer on a basis of bargaining equality with those to whom he sold and from whom he bought.
Bigness or concentration has been a steady, if not a growing, characteristic cf American economic life. Most businesses today are bigger than they used to be. Since the end of World War II there has been a tremendous growth in
2the size of business corporations. Companies have bought out smaller firms and integrated their operations for greater efficiency. Today four or five large corporations dominate the farm machinery field. There are only four large meat packers in the United States. A few food pro- cessing companies dominate the market. Most groceries are now sold by large chain stores. The AFL and CIO have merged into a single organization representing more than 15 million workers. Agriculture, with its ^,500,000 farmers, makes up the largest single group of free enter- prise operators left today in the United States.
Census data show that over the years the farm popula- tion has been declining. One of the results of this change is that with each election farmers have shown less voting strength. City Congressmen are voting the consumer's viewpoint more emphatically.
Against such a background one can view the nature of the farmer's business and his need for collective action. The typical farm is a small-scale business unit or firm too small to achieve the advantages of integrated operations alone. As small business units, farmers have little or no influence on the prices of the commodities they sell or the prices of the supplies they buy -- they play such a small part In the total agricultural industry. And yet., the market for agricultural products (despite government programs)
3

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  • 2008 Subcommittee Reports of the Legal, Tax and Accounting Committee

    2008 Subcommittee Reports of the Legal, Tax and Accounting Committee

    2008 Legal, Tax and Accounting Subcommittee Reports INTRODUCTION The LTA subcommittee reports are prepared annually through the efforts of individuals who serve on NCFC’s Legal, Tax and Accounting Committee. NCFC is deeply grateful for the dedication and generosity of these volunteers, many of whom are national experts in their respective areas of practice. The purpose of the reports is to interpret and highlight the legal, tax and accounting events of the past year, and to discuss in detail many of the issues faced by cooperatives. The legal, tax and accounting issues of farmer cooperatives are affected by a number of external forces and general practice issues, with the added focus of specific industry issues. The LTA subcommittee reports are the only resource summarizing all these issues in a single volume. If you have questions or need materials referred to in the reports, please notify me by email at [email protected] or by telephone at 202.879.0825. Sincerely, Marlis Carson General Counsel & Vice President, Legal, Tax & Accounting 2 The following reports do not constitute specific advice and may fail to address aspects of an issue or development relevant to the reader. Readers should be particularly aware of the importance of checking for subsequent developments, as these reports may not have been updated since originally composed. 3 Table of Contents 2008 Subcommittee Reports of the Legal, Tax and Accounting Committee Page Introduction..............................................................................................................2