sacked lots merit differing charges for storing. Those at two cities are:

At both cities all other warehouse charges are approximately 50% higher for sacked than for bulk grain (cleaning, mixing and all conditioning operations).

CHAPTER XXII

WAREHOUSING SERVICES OF GRAIN ELEVATORS

Services of the Elevator

The specific services performed by a terminal elevator are the storage of bulk grain in the bins or tanks; the storage of specialbinned grain; the transferring of grain from one carriage of transportation to another; cleaning and conditioning the grain, which processes include cooling, drying, clipping, bleaching and dockage; and grain mixing. Each of these services is a source of income.

Storage of Bulk Grain.-For bulk grain, of which the ownership is commingled under the principles of fungible goods, the storage charge is separated into "the first storage period" and "storage thereafter." The reason for this separation is that certain handling is needed in order to get the grain into storage, and, in due time, for discharge from store. The costs of these services of receiving and delivering are combined with storage for a few days, which is regarded as the minimum time for which grain will be received for storage. These days correspond to the "one month or fraction thereof" which is the basis of warehouse charges in other types of warehousing. With the costs of handling in and out thus included in the charge for the initial period, all storage thereafter is straight holding of the grain in store until ordered withdrawn.

The initial period shows wide variations,-from five to twenty days. It is spoken of as "free time" but it is not free time in the sense that railroads allow a certain time for removal of freight from the freight depot. The free time of grain storage is merely a colloquial manner of defining the minimum period for which storage may be contracted, or the number of days which are combined with the charge for receiving and discharging to make the

elevator's minimum charge. At Chicago, for instance, the initial storage charge is 14 cents per bushel, for which ten days' storage is allowed, with 1-20 cent per bushel for each day beyond the tenth. At Duluth and Minneapolis, the first storage charge is 11⁄2 cents

per bushel, with fifteen days' storage included, and with 1-30 cent per bushel per day thereafter.

STORAGE CHARGES AT TERMINAL ELEVATORS.-For the principal terminal markets, the preceding page gives the elevator charge for the initial storage period (including handling in and out), the number of days of free time included in this initial charge, and the rate per day for each day thereafter.

For Pacific Coast points the charges and free time are those of elevators where grain is handled in bulk, not for flat warehouses where grain is handled only in sacks.1

INSPECTION AND GRADING.-Grain as handled in bulk is fairly homogeneous in kind and quality. Moreover, the handling and storing in bulk itself tends to promote uniformity by washing out slight differences in quality through the mixture that is inevitable in such handling. As it is received into the terminal elevator, the grain is everywhere inspected (the “in-inspection") in order to establish its grade. The warehouse receipt is issued upon the basis of the inspector's certificate without reference to the owner's opinion as to quality. The grain is then stored with other of like grade and when delivery is to be made the desired quantity is drawn from the commingled whole. It is re-inspected as it goes out of the elevator (the "out-inspection").

So long as grain was sold by sample, grading was merely the buyer's determination of the value of a lot. When put into storage, each lot was held by itself, intact and separate from all other lots. The warehouse receipt was the equivalent of the identical parcel of grain for which it had been issued. With, however, the growing volume of American grain, the method of selling by sample and of holding each lot by itself became unwieldy. As, also, elevators attempted to deliver on demand each particular lot their difficulties multiplied, and even with most conscientious efforts to maintain prompt delivery, it became impossible to satisfy all patrons.

The necessity was so great that adoption was made of the

1 The data for this table, as for others that are to follow, are those in effect in 1924. They are derived from State regulations where such apply, from exchange regulations for "regular" elevators where such apply; from interviews and by direct correspondence; cross-verification has been applied by use of these sources to check each other. Railroad tariffs and port commissioners' tariffs have been consulted wherever they apply.

fungible principle, and this step coming, as it did, shortly after the invention of the elevator (1843), the grain trade of America within a single generation made the two greatest advances of its development.

In 1858, the Board of Trade of the City of Chicago by the appointment of a special committee, attacked the double problem of grading and of commingling. At the annual meeting of the following year (January 1859) the report of this committee was adopted. It provided for the inspection of grain not only into store, but on to the vessels also. It provided standard grades for wheat only, and these standards were repeatedly modified during the ensuing nine years, by the end of which period they settled down into permanent grades. Mess pork was the second commodity to be subjected to standard grades. Fish was third. Other products of the Chicago exchange quickly followed, so rapidly in fact that in three years practically all the products traded over that exchange were of standardized grade, under the new method of disinterested and official inspection.

The same committee met the elevator situation (of commingled grain) by formulating an agreement, to which all parties readily assented. It provided that all grain of the same grade, as determined by the newly instituted inspection system, was to be warehoused in bulk without attempt to preserve the identity of any lot. "General receipts," as they were at first styled, were issued for a specified quantity of the grade. The warehousemen, in the agreement, bound themselves at all times to deliver grain, which in the opinion of the inspectors is equal to the grade called for by the receipt.

The official inspection into standard grades and the commingling of fungible commodities was instituted on the 15th day of June 1859, on the date recommended by the committee. The inspection of grains was taken over by the State of Illinois in 1871, upon enactment of the public elevator warehouse laws (Form 32). The innovation, thus worked out at Chicago, won general approval, and its adoption at other markets followed, although curiously enough the use of general receipts was not permitted by the New York Produce Exchange for fourteen years (1874). At the present time, inspection and grading of grains.