Omaha Daily Bee Newspaper, April 4, 1909, Page 44

THE OMAHA COW AND CREAM EARN BIG MONEY Development of Creamery Industry in Nebraska in Recent Years Remarkable.” Uniformly High and Even Quality is Reason for Leadership. DEMAND OFTEN EXCEEDS SUPPLY Glimpse at Early History of the In- dustry by Pioneers. VIEWS OF RUSHTON AND HARDING fes that Give High Position as =n Dairy State and Syaopsis of RecentsDeclslon. ¢ aairy industry in Webraska: .‘.-‘I‘;"‘:: gl m cows in the state Jan- uary 1.'1908, government figures, 897, “l' of sama, at aa sversge prics of I-h.:‘ol‘ :s.mml“l:‘ Webrasks, oon- trali: L, ; 00 ral ipat of cremmery butier 1908, esti- mated, 40, pounds. Value of samse, ,000,000. ’M‘.f. of same manufactured in ocentralized ereameries, 90. Wumber of farms in Nebraska ocon- tributing more or less to production of oreamery butter, 1 Statistios of o industry in Omadat Rumber of o o, 7. Investment in same, #1,000,000. utter manufactured in 1908, about 18,000,000 pounds. ‘altle of name, $4,500,000. Wamber of {atmers comtributing cream, Ayerage price of butter fat in Nebrask Ipcretss of “Gumans’ creamery b ase A oreamery business ‘since 1900, 318 per oent. In 1900 the creamery butter produced in Nebraska aggregated 11,000,000 pounds, with & value of $2,000,000. In 1908 the production of creamery butter in tho state amounted to 45,000,000 pounds, with & value of $10,000,000. J. H. Rushton makes the estimated total value of the milk and cream sold from the farms of Nebrasks in 1908 between $15,000, 000 and $20,000,000, This represents cash re enue of greater or less volume to a very large proportion of the farmers of this state, and to a great many more in the states immediately adjacent. There are seven centralized creameries In Omaha, and during the year 1908 they manufactured 18,000,000 pounds of butter, with a market value of $4,600,000, Figured down to a going basis, the in- vestment represented by the seven Omaha butter factories easily tops $1,000,000. The average price paid for butter fat in Nebraska during 1907 was 28.9 cénts a pound, being 4.08 cents less than the New York price. During 1908 the average price paid in Nebraska was .17 cents a pound, belng but 351 cents less than the average New York price If growth denotes health, the creamery industry in this state, and the underlying business of dairying, has been enjoying health of high degree since 10, for its Browth in the perlod ending with last year has amounted to 818 per cent. If the same ratio s continued for the next ten ycars the creamery output of the state will amount to 100,000,000 pounds annually, with an approximate value of $25,000,000. Butter Fat is Ready Mouey. Butter . the sls of the creamery industry as integral factor of the com- mercial world, Is cash. This means that while the farmer turns his cfop but ono in & year, the butter fat producer turns his output from twenty-four to fifty times jear. He gets in on the compound inter- est tal with both feet, a tremendous consideration from the dollars and cents standpoint. Laying aside for the moment the fer- tility of the soil that is conserved by dairy- Ing, take the skim milk item. This by- product of buttermaking is worth 3 cents a hundred. at a falr valuation. On the basis of present production, the skim milk represents a value of $.750,00 for feeding to the calves and plgs, the tribe of which is very numerous in Nebraska. The creamery industry in this state 1s necessarily done on a thin margin of profit. Competition is keen, and only the vast volume of business transacted makes it possible for the creameries of Omaha to maintain the position they have attained as makers of the very highest grade of butter known to the United States. This pre-eminent holding of quality, year fn and year out, commands a price, based on d: mend, which enables the financlers of the fawn-eyed cow to stick consistently to the “thin margin” spoken of above. Here is the elemental secret of their great success. J. H. Rushton, president of the Fairmont Creamery company, s & nestor of the clan of dairy cow men, and he is, further, an encyclopedia of the vital things that are tangled up with this business of far-flung ramifications. He says Cow as Revenue Producer. ““There are seven sources of revenue from the cow. Firet, the butter fat; second, the whole milk that feeds the calf for a cer- tain time after birth; third, the butter made for family use; fourth, the calf; fifth, the skim milk for ealves and pigs; sixth, the manurial element, Mquid and solid, thou- sands of pounds; seventh, the value for beet after her day of usefulness as a milker is dove." And Mr. Rushton asks, with eyes reflect- fng & fine conviction, “What other crop under the sun compares with the cow crop?’ There is none, of course. Back of the figures qucted above, and back of Rushton's seven separate elements of profit, we have to keep in mind all the local household uses to which dairy prod- uects are put on the 125,000 or more farms of this state. The cow is, for instance, the great seconder of the Kinkald act. In the so-called “'sand hill" country, after the settier has moved onto his mile-square farm, his first resource as & cash producer is his cows, so much so that it is now the rule for the Kinkalders to provide them- selves with cows as certainly with horses. Steers, even, are a secondary com- slderation with the wise begirner on the section homesteads. A milker is ready money any hour of the day when her product is taken to town, and she carries many & family with flying colors through the first tollsome year The battalions of cans ranged on the milk platforms of the big stations here in Omaha are but representative of the smaller companies and regiments of cans that are assembled every d&y on country station platforms. During 1907 there was veceived at the Union depot in Omaha over 340,000 cans of cream. and during 198 there came Into the same station over 0,000 cans i butter material Many thousands more were recelved at the Burling Webster street depots It must not be o 1ooked, either, that thousands of tons of ice cream are mad from the fiuid r of the Nebraska cow No mccount is taken of this food for the gods in computing money totals herein The ice crecam Industry Involves a big story in ieelf Condensed Milk Industry. At Waterloo, Neb.,, the Waterloo Cream ery company has a factory which turns out 500 gallons of condensed milk per day when running at capacity. This condensed milk adjunct of the Waterloo reamery com- pany is steadlly growing in output and reputation, and promises to be within a very few years one of the big noises in that branch of the business, which is vet & new thing in this section. This company dld a business of $350,000 last year. While it 1s one of the comparatively small com panies, it deals with 1,200 farmers and has sixty employes, representing a total of 23 people dependent on the payroll. These fig- ures will give an idea of the very great Importance of the seven establishments lo- cated in Omaha Division of production of the seven Omaha creameries may be roughly made as | follows: Falrmount and Farmers' Co-Oper ative companies, 5,000,000 pounds each, more or less; David Cole Creamery company. and Kirschbraun & Sons, 0,000 pounds each, more or less; Omaha Cold Storage pany, 2000000 pounds or better; Waterloa Creamery compar.y, 200,000 pounds; Alamito Sanitary Dairy company, 100000 pounds These figures are, of course, approximate. thusiast says: “The world is our fleld. The Omaha product goes wherever high- class butter s in demand from the Atlantic to the Pacifie, fo New Orleans, to Alaska and to the Mexican line. “In the space of a few years the busi- ness of butter-making has been changed from a cross-roads industry to an import- ant commercial enterprise.” Charles Harding, president of the Farm- ers Co-Operative Creamery company. thus Nebraska. He further asserts: “Nowhere in the Urnited States has the scientific manufacture of butter been carried to the point that it has fn Omaba.” Demand Often Exceeds Supply. The quality of Omaha butter s uniform, as to color, salt and texture, all the year round; and those who handle it and con sume it agree that it is the most satisfac- tory grade of butter produced anywhere in this country. The demand Is often greater than the supply. On a recent day | were excessive and defendants wore or- Mr. Harding had on his desk orders for two carloads which he coultl not fill Going outside of Omaha, the dairy busi- ness in Nebraska has had probably the most rapld growth In the last ten years of any place in the United States. This is due largely to the energy and vigor with which the men engaged in the ind have pushed out for business in ever rection. As & result Omaha Is today the greatest butter-making center in the world beyond any doubt Mr. Harding is, by the way, the grand- dad creameéry man of the state. Twenty- elght years ago he was running one of the ploneer butter factories of Nebraska at Schuyler. There were only two others, one at Fremont, run by J. Dickson Avery, and one at Columbus, run by a man whose name is now forgotten. ,(Ten years ago, through the efforts of Harding, the pres- ent so-called centralized creamery indus- try had its inception in Omaha. He was the first man to advertise in farm papers of general circulation offering a price for butter fat from hand separated cream, based on the New York market. Harding's advertisements had two im- mediate effects. Because of the price of- fered, much higher than the farmers had ever been able to secure under any other system in this part of the country, ship- ments of cream increased enormously, and a demand was created for hand separators whereby thousands were sold all over the state of Nebraska. The Omaha market was at once opened to all farmers in the state and the distance from which ship- ments came was limited only by the rate of transportation. Regardless almost of the location of the producer, Omaha be- came a market where a remunerative price could be secured for butter fat. It has | 50 remained to this day, and the business has grown by leaps and bounds. Other creamerles in the state followed Hard- ing’s lead as quickly as they realized the good thing that had been opened to them and they began at once to push the sale of hand separators. Bitter Opposition Overcome. Large butter dealers offered bitter op- position to the system at the outset be- cause heretofore the small creamery had consigned its output to some commission house and had been compelled to accept such price ms the commission merchant saw fit to return. Now, however, the but- ter dealers found it necessary, if they wanted to handle any of the centralized creamery butter, to buy It outright at a price satisfactory to the creamery man. Right here was where the cross roads method was cut out, commercial stability was established and the present stupend- ous development began. The old plan, followed at Fremont, Schuyler and Columbus, was to furnish the farmer with what were known as deep- sitting cans In which to place the milk. These cans were provided with glass gauges in the side and wero submerged in water. Cream was paid for by the inch, or gauge, and was gathered by wagons sent to the farmer's door by the creamerfes. This plan looks good on paper, but during the ten or fifteen years it was in operation the farmer found he was not getting ! remunerative price for his butter fat. The expence of conducting the business was very heavy, and the loss to the farmer came from the fact that he was unable to get more than about three-fourths of the butter fat out of his milk by the process. Thus he was Inft mighty small pay for his work and trouble. Realization of these drawbacks made Harding’s opportunity. Besides this, the quality of butter pro- @uced in these old-time creameries—so- called for want of a better name—was as uncertain as the weather. It, In fact, depended on the weather, as pasteurizers and starters were unknown. Hence there was no such thing as scientific butter- making. Promoters Soaked Farmers. Promoters, sent out usually by creamery supply houses, were instrumental in starts Ing & great many creamerles. Organizing local stock companies, men were placed in charge of (he plants who had no practical knowledge or experience. These factories were often, almost generally, located re gardless of the cow population. They were failures, and it is safe to say that almost every town in Nebraska which existed at that time has bad a creamery of this kind They still have the memcry thereof, heavily charged with regret. Later came the power separator and (he “whole mik" p'an, by which the sweet milk was brcught to some ceatral polnt to be separated and the skim milk returned to the farms. Dairying being a side issue, this plan was foredoomed to fallure, aus It had been in other localities. Kxpense of bringing the large volume of milk to a central polnt was encrmous and the plan wan a time-killer of top-notch caliber. By the time the skim milk was returned t the farm it was fit only Lo feed to the I'g [on some sections of the roads, notably on | strenuously fought suit by which the cen- | tralized creameries sought to securs a re- AS to the field of distribution, one en- | | the Wisconsin Dairy Manufacturers and | epitomizes the progress of butter-making in | calves could not possibly be raised on | the stuff. Falling to raise calves, dairying as @ farm resource was dead. It should be sald, however, that the whole milk plan | still works well enough In thickly settled airying sections in Tllinols, Wisconsin and Minnesota, but only in sueh territory. Bven there it Is gradually giving way to the hand separator system. The latter had economy for its great merit, saving the farmer the hauling of the milk, which was a continual task In summer time, as get- ting the milk to the station while sweet was the one great point. Mixing of ths skim milk is found to be a source of spreading bovine tuberculosis, as has lately been proven by Investigators of agricul tural colleges, who have issued warnings against the plan. Not all of the cream produced in Ne- braska goes to the creameries of the state, Denver, Kansas City, Topeka and Sioux City taking a great deal from the producers in thelr immediate neighborhoods. On the other hand, Nebraska cr parts of Kansas and Towa quite heavily. The number of dairymen and tarmers look- Ing to Omaha for cream checks every week 1s 30,000, as closely as can be estimated. Resume of a Noted Cane. So great has become this business of cream gathering and shipping that trains devoted to it almost exclusively are run the “high line” of the Burlington. It was this development beyond the dreams of early years that brought about the recent duction in the rates for hauling cream. The plaintiffs of record were Beatrice Cream- ery company et al. Falrmont Creamery company et al. and Blue Valley Creamery company et al. The railroad companies di- rectly represented by counsel were the Tili- nols Central, Chicago & Eastern Illinois Chicago & Alton, Chicago Great Western Chicago, Burlington & Quincy, the North- | western and the Rock Island. The Pacific | Express company was also represented, and Producers’ association et al., intervenors, | baving backing, largely, of the local or | country creameries. After exhaustive hearings, the case was submitted to the Interstate Commerce com- | mission on December 1 last On January | 6 of this year the commission handed down | a decision, accompanied by a lengthy opin- | fon in which the whole history of the busi- ness is traversed, The commission held that, upon the facts disclosed in the record, the existing rates dered to establish new rates, which the centralized creamery men say are t0o high The commission established a rate of 2 cents for ten-gallon cans for all distances up to and Including twenty-five miles. “Be- | yond twenty-five miles,” says the commis- | slon, “we think the rate should increase 1| cent for each five miles, up to and includ- ing fifty miles. For the next fifty miles it should Increase 1 cent for every ten miles, and 1 cent for every fifteen miles there. after.” Rates Made by Commission. The commission thinks the effort should be made to transport all cream in the larger can. Tt therefore establishes “rates for five-gallon cans which are approxi- | mately seven-tenths of the rate charged | for the ten-gallon can, and for the ecight- gallon can rates which are approximately nine-tenths of the rates established for ten-gallon cans.” In the course of the discussion and opin- ion the commission gives the centralizers a clean bill as conducting a legitimate In- dustry In a legitimate manner. Holding that “the trouble comes In the borderland (between where the local creamery and the centralizers, ore or the other; clearly hold the advaniage), of which there is much the opinfon continues: “The general situation must be kept clearly In mind. The local creamery can only exist profitably when it can manu- facture 100,000 pounds and upward of butter annually. * * * Today farmers will not haul milk more than six or seven miles to the local creamery. Cream can be trans- lml"led by wagon profitably somewhat longer distances, but it may be generally stated that the local creamery can only operate profitably where sufficient milk is produced within a radius of half a doze miles to manufacture 100,000 pounds of but- ter per annum. Now, there are vast areas in the territory covered by this complaint, producing at the present time milk from which thousands of povnds of butter are annually made, in which the local cream- ery, under the above test, could not exist, for the reason the cow nopulation is not sufficlently dense to produce the necessary quantity of milk within the prescribed area. In all this territory the centralizer affords to the farmer the ovly means of disposing of his cream Centrallzer System Necessary. “To strike down the centralizer would be to strike down the dairy Interests in these sections. This territory includes al- most all the states of Nebraska and Kan- sas, much of Missourl, considerable of Towa, and some of Minnesota and South Dakota. * * * The centralizer affords to hundreds of thousands of farmers the only satisfactory means of disposing of their milk. A blow at the centralizer is a blow at every farmer who produces butter fat in thousands of square miles of the terrl- tory covered by this proceeding. It seems plain that the duty of this commission is to establish just and fair transportation charges Insofar as that can be done, and allow these rival methods to operate under those charges. We should not establish a scale of rates with a view and for the pur- pose of fostering or discouraging either form of this industry.” Since the controversy arose, the Rallway commissions of Nebraska and Wisconsin have established rates for the carriage of | cream. The Nebraska rate ranges from 16 | cents for twenty miles to 68 cents for 600 | miles, The Wisconsin rate ranges from 13 | cents for twenty miles to 50 cents for 300 | miles. One great factor in the remarkable suc- cess of the centralizer plan is the red tion in the cost of putting a high-class | butter on the market When the local creamery can draw material enough to make 100000 pounds per annum, fixed as the profitable minimum by the Interstate Commerce commission, the cost of manu- tacturing will be about 4 cents a pound Some large local or co-operative creameries have succeeded in reducing this cost to 2 cents, possibly a shade lower, The great | centralized plants turn out their product | at A cost of about 1 cent a pound, so that the cost of transportation is offset by the reduced cost of manufacture. They are | able, too. to command the services of the highest priced butter makers, working with the veny latest machinery; and here | ¢ should be remarked that certain fixed charges go on all the time that local creameries are going threugh the dull se son, whereas the large plants in Omaha make it a point to keep Tunning at full capacity every day they possibly can. Their output is so great, the units so many, they can easily afford to manufacture and sell at a margin of profit not possible to the loeal plant with a limited field to draw trom It requires 100 pounds of cream to make (hirty pounds of butter. The centralizer gets all the cream and no milk, as against he proposition the whole milk creamery is Farmers Co-Operative Creamer Compan Dairy Headquarters for more than 10,000 cream pro- ducers in Nebraska, Iowa, Kansas, Missouri and South Dakota. Are YOU With Us? HE increasing demand for our butter in all the markets of the country forces us to seek constantly new supplies of cream. this summer. overproduction. We predict good prices for butter fat again Everything points that way. On the contrary, there is much more danger No danger of of a shortage of butter. We are prepared to give you the very best possible deal. Ship us your next can of cream, and we will guarantee to give you satisfaction. Farmers Co-operative Creamery Company, Omaha up against, to pay transportation on| seventy pounds of wastage, and return the can besides. Hand Separator Great Factor. The hand separator, in the opinion of experts, bears the same relation to the growth of dalrying that steam has borne to transportation. It revivified, reinvig- orated and regenerated the whole busi- ness. It made possible the delivery of his { butter by the farmer at the least expense It enabled him to get the fullest value out of his skim milk. It opened to him the cholce of the best markets, Instead of being confined to one. The establishment of large butter factories as a result of the general use of hand separators resulted in economical manufacturing and the employ- ment of the highest skill thereln, produc- tion of goods of high and uniform quality, and the reaching out for and conquest of markets not open to small factories. All of these things combined have in nured largely and steadlly to the benefit of the produceF and the manufacturer alike. The policy pursued has been broad minded, necessarily, and has stood the test of wear. Every farmer in the western | country, Nebraska in particular, has been given & real and a stable market for his cream; not a market in one particular place or to one person company, but & choice, to be freely made and without restraint, of any one of the many want ing his cream. He could and can, in short, sell to whom he desires under con ditlons the most advantageous, Net cash returns, quick and certain, need be bhis only guide in disposing of his butter fat As a factor In conserving the fertilit of the soil on which she lives the cow is greatest of all. Today she is quite gen- erally granted this pre-eminent merit, and In the future this fact of potent import must command the studlous attention of the people. The cow as a money maker and basic element of continuing prosperity has an established position Omaha Motto, High Quality. The theory of the Omaha creameries s The more we improve the quality, the greater will be the demand. This has been a winning slogan and s a result the city and the state, too, has secured Ip this in dustry a source of growth that is not yet fully appreciated. As long as people eat butter, It handled along present progres- sive lines, the butter-making Industry will become and remain permanently among the really great elements of aha's development As Mr. Rushton says: “This indus reaches out and touches every home in t broad land—east, west, morth and south Cream is shipped to Omaha from all of Nebraska, a large part of Kansas, Missour] Towa, Dakota, Minnesota, and portions of | Colorado and Wyoming Because of this peculiar drawing power, there is no city that occupies & more ad vantageous position, or derives greater natural prestige, in having all these thou- sands of people conected with us by these lines of active dally commerelal life, Every | other industry in the city that is the home of these great money-spreaders and reputa tion-carriers is benefited, directly or in directly, because of this connection. Every | home outside of Omaha thus tied to us by | direct, lively interest, continuing through out the year, is also benefited by such a | connection with daily opportunity. In the census of 190 Nebraska was cred county of 198, which returns to include all the dairy T discrepancy of between the census 1900 and the assessors in QUALITY 4,000 Dairymen in Nebraska, lowa, Kan- sas, Missouri and South Dakota are SatisfiedPro- ducers of the Cream. We invite you fo join with us. PURITY “ “Just the Best” It requires the product of 60000 Cows to Fill Our annual re- quirements for Idlewild Butter David Cole reamery Co. and 26,812 "airy cow enclosures, making a total of time 4000 In excess of the state at that Tenth and Howard Streets, Omaha, Nebraska that the assessors have slighted their work credited Nebraska with 879.000 dairy g00d judges Lo be below to (he state bureau of statistics | rather thun above the actual dairy cow [ in the | population were sup- | the claim for population thav the number | cows, assessors of the substantiating | per cow per year in Nebraska census of best opinion m it is lsted i3 the immense in- | pounds better. Unfortunately production of but enumerators 1908 is has been & de- too great | crease of {ted with 513,644 dairy cows vn ferms and | 1o be explained on any other theory than|not to the extent indicat butter-making on the figures on creamery butter Increase. That there are more dairy cows than any one has in- cluded in returns is & well based concly slon. As to the amount of butter produced the ' con 200 the ber of cow owners who keep accurata ords 1s very small, despite the efforts (Conmnusd an r..- el