3 1293 01013 9271

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This is to certify that the
thesis entitled
AN WYSIS 0F IIICHTBAN'S LIVESTWK
AUCTION INDUSTRY
presented by
Stanton P. Parry
' ' l . has been accepted towards fulfillment
‘ of the requirements for ,
1 later of Science—degree inJaimalztnru Economics
'3 Major professor
,/ Date—MES“;at 7, 1953
k f
' ' 0-169
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m l m “tumult-Wm macaw.
To AVOID FINES return on or baton dot- duo.

DATE DUE DATE DUE DATE DUE

 

 

AN ANALYSIS OF HICHIGAN'S LIVESTOCK
AUCTION INDUSTRY

A Thesis
thod to the School of Graduate Studios of Michigan
State College of Agriculture and Applied Science
in partial fulfillnent of the requirements
for the degree 0!

MASTER OF SCIENCE

Department of Agricultural
Renaldo:

Stanton 1’. Pan-y
1953

.1 ~{ r‘ R

- -

 

 

Ammmr

The author desires to express his sincere appreciation to all those
who assisted in the develomsent or this thesis. The author is particular-
ly indebted to Dr. Robert Eraser, she gave freely or his tine during or-
ganisation or the study and preparation of this thesis.

The assistance of Mr. George Boutell, Commuty Auction Sale In-
specter of the Bureau of Label Industry and other nesbers of that Bur-
eau, is gratefully aclmewledged.

me author wishes to them: especially the auction operators who
gave gemrousl: of their tine and intonation in order to note this stw
possible. 1

Thanks are due to Mrs. Robert React-thy rho typed the nanusoript,
under deadline pressures, and gave new helpful suggestions which aided
in the technical construction or this thesis.

Finally the author wishes to thank the Department of Agriculhrel
Economics and particularly Dr. '1'. I. Garden for the assistsntship which
lads the author's continuing education and this thesis possible.

no author assumes full responsibility for an errors in this
thesis.

‘30!j”‘{‘ (\
[.5 \_ Jde}

TABLEOFCONTERTS

CHAPTER PAGE
I. A] INTRODUCTION 1'0 THE LIVETCCK AUCTION INDIBmY e e e 1
Thepm'poseofthissmdy.............. 2
Livestock auction industry history. . . . . . . . . . 5

II. Gmmwrmmmmemwsmmmum-
STOCKINDUS'mI.................... 114
III. PROCEDURE IN SELECTING a REPRESENTATIVE sums. . . . . 23
Iv. GEOGRAPHIC Locum! AND SALE 1m COMPETITION or MICHI-
GANAUCTIONS..................... 36
v. SEASOMLIT! or LIVESTOCK MOVEMENT THROUGH SELECTED

MICHIGANAUCTIONHARKETS............... 52
VI. mGANIZATIOU, worms FACEI‘I'IES, ma PEESOUNEI. . . . . 66
VII. Gm 09mm PROCEDURE, 100mm mum

3mm came: AT momma AUtn'ION newts. . . . . 8!:

VIII. sum um cmcLUSst 100
311mm...”..................... 106
APPENDIIA. mnOUEerOUMIRE................ 108
APPENDIX B. QUESTIONNAIRE USED INPERSONAL mmvmds. . . . . 110

APPERDHC. AUCTIQIMARETSEILINGCHARGES..eeeooooo 121

TABLE
I.

II.

III.

IV.

V.

VI.

LIST OF TABLES

Changes in Numbers of Auctions and Percentage Change
Betveen 1937 and 1952 For Selected Earth Central
States......................ee.

The Location of 57 General Livestock Auctions in Michigan
Classified According to Type of rerun Area, June, 1952

The 57 General Livestock Auctions, and the 22 Sampled Auc-
tions from this Population Classified by Type of Other-
ship, and Imortant Quantitative Relationships to Each
0ther.........................

The Relationship Between the Samle Size of Business and
the Size of Business in the Total Population. . . . . .

The 57 General livestock Auctions in Michigan and the 22
Sespled Auctions Compared on Average High weekly Sale
inl9SlbySiseCategory................

Auction Grnership Entities and Embers of Auctions Glued
byEachEntityClassification. . . . . . . . . . . . e

lumber of Auctions and Percentage of the Total Auctions
Classified tn the Distance tron which Six Major Species
of Livestock are Received. Twenty-one Samled Auction

Beporting,l9§2....................

PAGE

33

h?

TABIE

II.

I.

II.

IV.

PAGE

Estinated Cost of Livestock Auction Facilities at

Tuenty-Tlto of Mchigan's Livestock Auctions. Gri-

ginal Valuation as Declared by Present Au: tion

Operator....................... 71
Estimated Replacement Cost of the Livestock Auctions

SanpledintheState.................. 71
Twenty-Two General Livestock Auctions in mchigan Clas-

sified by Amount of Pen Space, Exclusive of Runs and

Alleys......................... 72
Twenty-Two Michigan Auctions, Classified According to

SalesRingSeatingCapacity.............. 75
Twenty-Two Richigan Auctions Classified by the Amount of

IardageUnderCover.................. 77
The Ratings of Tuenty-Tso Ssspled Auctions on Condition

otPlentFacilities..............e... 79
Twenty-Two Michigan Livestock Auctions Classified by

Amount of Personnel Mloyed in Various Job Categories 81
Twenty-Two Aflchigan Auctions Classified by Size of Blai-

mssandNtmberofMloyeestorBachase....... 82

. Sources of Harket Information for Auction mentors of

Twenty-TwolflchiganAuctions.............. 90
Methods of Advertising Used at Twenty-Tee Samled Michi-

ganAuctions...................... 90

TABLE
XVIII. Selling Charges at an Auction Levying Most Common Charges
and Comparable Charges at the Detroit Terminal Harlot

Caspared........................

PAGE

97

LIST OF FIGURE

FIGURE PAGE
1. Sons Alternative Channels Through Which llichigan Parlors
lisySellTheirLivestock................ h
2. The Geographic Location of Michigan's Fifty-Seven General
Livestock Auctions, June 1, 1952. . . . . . . . . . . . 10
3. The Date of Establishment and Cumlative Number of Auctions
As Recorded for the Twenty-Tito Seapled Auctions Visited
intheSulmerofl952................. 13
1:. Distribution of the Fifty-Seven General Livestock Auc-
tions in thehigan, Classified by Type-or-Psrung Area,
1952.......................... 27
5. me Fifty-Seven General Livestock Auctions in mchigan
Classified by Type-churning Area, Along with the
Trenty-Two Such Auctions Samled, 1952. . . . . . . . . 29
6. Anilal Units and Decentralized Market mtlete for Each
Type-er-Farling Area So Delineated in Hchigan. . . . . 37
7. file Three Kain Livestock Areas of Inchigsn with lunbers
and Percentage of State's Auctions, Aninsl Units, and
flaughterersinEech.................. M
8. Three Principle Livestock Areas of Michigan with Anctiom
inEach Area ClassifiedbySise of Basin.” . . . . . . N.
9. Sales Dm for Hichigan's Fifty-Seven General Livestock
Auctions,Junc,l952.................. h?
10. Sale Day Conetition Between Contiguous Sales . . . . . . he

FIGURE PAGE

11. Average Seasonal Distribution of All Livestock Marketed

Through (Eleven) Sampled Auctions (Fiscal Year July,

1951toJune,l952).................. 53
12. Seasonality of Harketings of Cattle, Calves, Hogs, Sheep

and Lanbs Through Eleven Saapled Auctions (Fiscal Year

July,l951toJune,1952)............... 55
13. Seasonality of livestock hovenent Through Six Auctions in

the Southern livestock Area of Ilichigan (Fiscal Year

July,1951toJune,l952)............... 58
1h. Seasonality of Livestock Hovenent Through Four Livestock

Auctions in the Northern Livestock Area of Michigan

(Fiscal Year July, 1951 to June, 1952). . . . . . . . . 60
15. Seasonality of Livestock Hovenent Through the Auction in

the Upper Peninsula of Hichigan (Fiscal Tear July, 1951

toJune,1952)..................... 62
16. Percentage Distribution by Species of Livestock Sold in the

Three Major Livestock Areas, and for the Whole State of

mchigm....................... 6h

17. A Well-Arranged Snell mchigan Auction Sale Barn. . . . . 68

CHAHERI

AN INTRODUCTION 1‘0 THE LIVETCBK AUCTION INDUSM

me of the leading agricultural industries in the State of Michi-
gan is the livestock industry. Ch January 1, 1952 there were 1,890,000
cattle and calves: £63,000 sheep and lambs; 956,000 hogs and pigs; and,
79,000 horses and colts on the ferns in Michigan. This placed the State
of Michigan sixteenth in the United States in numbers of cattle and cal-
ves on farms, twenty-second in numbers of all sheep and lambs on ferns,
and seventeenth in nunbers of hogs and pigs on {8138.1 Furthermore, in
menigan the estinated total. cash receipts from the narketing of live-
stock and livestock products can to [:70 million dollars in 1952. In
this sense year the returns from all crops marketed totaled only 275 nil-
lion dollars.2 '

In the last few years, the livestock auction has appeared on the
marketing scene and has grown to be one of the more imortent outlets
for livestock. However, at Michigan State College no studies had ever
been nade dealing explicitly with the livestock auction industry, and no
information was available to answer questions about this industry submitted
by farmers, auction operators, law-makers, students and others interested
in livestock marketing.

 

1 Michigan cultural Statistics 122, (Michigan anrtnent of
Agriculture coopera with-the B.A.E. of the United States Departunt
of Agriculture, 1952).

2 Information from office Michigan Co-operative Crop Reportim
Service - Lansing, Michigan, date in process of publication for 1952
"Michigan Agricultural Statistics ". ‘

 

2

The moses 9_f_'_ _th_i_._s_ st 1°39 First, to ascertain the develop-
nent of livestock auction narkets for the sale of all types of livestock
in Michigan; second, to determine the character, and seasonality of the
livestock handled by then; third, to inquire into their facilities, or-
ganisation and nethod of operation; fourth, to attth to determine the
services rendered by then and charges nade for such services; fifth, to
inquire into the auction's Operating, disease and credit problem; and,
sixth, to deterrine the auction's effectiveness as a narketing outlet for
the mchigan farner's livestock.

The farmers of Michigan are not restricted to the use of this new-
set of the livestock marketing outlets, for other possible alternative
narkets were the following:

1. They could elect to ship their livestock direct to the ter-
nlnal narkets at Chicago or Detroit.

2. They could ship their livestock to a dealer or packer owned
concentration yard, or to one of the three cooperatively run concentra-
tion yards in the state (at Hour, Schoolcraft and Portland).

3. As a further alternative, the faners of Michigan could de-
cide to ship direct to the packers. There were a nunber of these local
packers and slaughterers available. For enamle, wtile only 103 were in
operation throughout the state in 193933 there were 523 such packers and
slaughterers in operation in 1951.h

 

3 r. voee, Marketing maggot: livestock (Unpublished Master's
Thesis for Department of Economics, Michigan State College, 1910), pp. 70.

h R. Eraser, Unpublished emery from Office of Price Stabilisation
records for the year 1950, (Department of Agricultural Economics, Michigan
State College) (nap).

h. Fanters could elect to sell to dealers and truckers at the
farm. There were over 900 such dealers and truckers licensed in the
state in June, 1952.5

5. Furthermore, farmers could ship to one of the few remaining
cooperatively run shipping associations. In 1952, reliable information
shows that only four remained in the state. These were the Lake Odessa
Cooperative Association, the North Adams Cooperative Association, Reed
City Shipping Association, and Williamston Cooperative Association. There
has been an extremely rapid decline in the number of these shipping as-
sociations in the last few years. In 1922, there were 200 such associa-
tions in Michigan. In 1930, 11:3 remained. Subsequent years found 33
associations in 1939, 23 in 1915, 11; in 1915, and four in 1952.6

6. As a final alternative, farmrs may ship and sell to other
farmers directly. Contacts and contracts are harder to make and trans-
act here, but much of our dairy breeding stock is 'sold in this manner.

Figure 1 shows diagramatically the alternative marketing channels
open to a Michigan famer. However, this thesis has concerned itself

with only the livestock auction industry.

 

5 List 01 Licensed Dealers and Truckers Sgpt ,
ember 1952 Bureau
of Animal Wm, Michigan Department of Agriculture, responsible for
dealer licensing.

 

6 D. Stark, LivestockHar Market%igg Extension Re ort ((Depart-
ment of Agricultural Economics, c gen 8 College,
graphed). pp. 10-13. The 1952 information was obtained from a personal
interview With Mr. Stark.

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Perhaps it would be easier _t9_ W the livestock auction

industry if; we delve briefly into its history: The earliest reference

 

believed to have been made to this method of selling was in 193 A.D.7
At this time it is believed that Roman soldiers, after the death of
Pertinax, offered to sell the Roman World at auction.
The holding of auctions in America is supposed to have started
as early as 1676 in New York City.8 The first livestock auctions were
started in England around 1836, while at almost this same time similar
emeriments were supposed to have been carried on in America. In Sect-
land reference is made to the holding of livestock auctions in 18149.9
The first livestock auction sale recorded in the United States
took place in Ohio in 1836. This was a sale of imported English Cattle
(largely Shorthorns) conducted by The 9_h_i_o_ 9M _i_'_o_1_'_ morted English
Cattle, which had been established in 18314.10 One of the oldest regular
livestock auction sales was established in 1853 at London, Ohio. This
was called The Madison mowing m: and started with a total capital

 

7 Charles S. Plumb, Marketing 9; Farm Animals, (Boston: Ginn and
Compalv, 1927), pp. 259.

8 Ibid, pp. 260.

9 G. G. Randall, and L. B. Mann, Livestock Auction Sales in The;
United States, Farm Credit Administration‘fi‘un't’, e in‘BFT, Mai-I939): pp.
111;.

10 R. A. Clemen, The American livestock and Meat Industg, (New
York: Roland Press, 19237; pp. 55.

of 10,000 dollars. They purchased livestock in England and on Septem-
ber 27, 1853 held their first sale of fifteen bulls, nine cows, titelve
hogs, and twenty sheep (all imorted from England). This first sale
grossed 26,257 dollars. m March 5, 1856 this company started monthly
sales. On March 2, 1869 this comparw held a sale in which one thousand
head of cattle were sold.n

Also in the 1850's, the picturesque Kentuclq "Court Day Salesu
were established. A monthly court on the first Monday of the month
brought the planters and stockmen together at the county seat. Some of
these sales were believed to have transacted as much as 250,000 dollars
worth of business in a single day.”

Other early sales include the one for horses which was started in
1900 at Miles City, Montana.13 Another early livestock auction started
in 19014 at Union City, Iowa.1h While a monthly auction was started in
1911 in Berlin, (1:10.15 This auction at Berlin was followed by other
Chic auctions, largely patterned, according to reliable resources,16

 

11 Ple, as £1.33, Pp. 260.
12 Clown, fie 2-1-20, pp. 75-770

13 H. Holland and A. R. Clark, Livestock Auction Markets in Montana
(Montana State College, Dcperimental Sta tann WW)— pp.

1’" K. Bjorka and S. Thompson, Cowman. Livestock Auctions in We
(Iowa Experiment Station Bulletin 376, 1938’, pp. 280.

15 P. Eckert and e. F. Kenning, The Livestock A_u_c_____tion in Ohio
(Ohio Encperiment Station Bulletin 557, 193-55, pp. 5.“

16 Ibid, pp. h.

7

after those of Kentucky. In the State of Kentucky as early as 1925 there
were thirteen livestock auction sales in Operation. The first regular
sale started in Lexington in May of 1922. From October, 1921; to October,
1925, eight of these sales averaged 21,079 dollars per sale}7

Farther West, it was found that there was an active livestock
auction sale in Nebraska in 1912.18 The State of Illinois started its
first livestock auction sale in 1927.19

Michigan started in the livestock auction business after most of
the other Mid-Western States, and the growth of its auctions was much
slower. The first record of a livestock auction in Hichigan was that of
the sale at Adrian in Lenawee County. This sale was established in May,
1933. It was known as ”The Adrian livestock Sales Convex-v" and it was
incorporated as such on May 1;, 1933. It was dissolved as a corporation
on June 30, 19113, and has since been operated as an individually owned
enteiprise.20

An auction was established at St. Johns, Gratiot County, late in

 

‘ 17 E. C. Johnson, Kentuc Livestock Sales 0r arrizations (Ken-
tucky Agricultural Experimen S ammO, , pp. 213, 217.

18 H. c. Filley, Livestock Auctions in Nebraska (Nebraska Agi-
cultural mperiment Station metin, 369, 1911115, pp. .

15’ Salli Illinois Livestock Thro h Auctions (The De
E? e partmcnt

of 3EAggricul ofics, Ufiversity o Womph 890, June,
19 )3 pp. 2e

20 Files of Corporations, Michigan Corporations and Securities
Comdssioming, Michigan.

1933s and another started operations at mosso, Shiawassee County, in
1933. The latter auction was incorporated in March, 193h.21 Other
early mchigan livestock auction sales were established as follows:
me at Charlotte in 1931:; one at Marlette, Breckenridge and Traverse
City in 1935, and one at Hillsdale about this: same time. In 1936,sa1-
as were established at Lapeer, Kalamazoo, and Ionia. In 1937, sales
were started at Big Rapids and Sancmsky.22

When the Farm Credit Administration made a study of livestock
auctiOns in the United States in 1937,23 they found that there were
thirteen livestock auctions in Mchigan. At the same time they found
that there were 1,317 livestock auctions in the United States and that
Iowa had 195, Illinois 139, Kansas 139, Missouri 113, Nebraska 98, (his
76, Indiana hh, Minnesota 38, and Uisconsin three.

Michigan and Wisconsin apparently were the slow starters in the
devlepment of decentralized livestock auction marketing in the Hid-West.

Since 1937, Michigan has shown a very rapid deve10pnent in the
livestock auction field. 01 June 1, 1952, there were sixty-four licensed
auctions in the State of Iflchigan. This represents a 392 percent-increase
in numbers of auctions since 1937. Michigan's phenomenal late increase
has not been confomable with the North Central Region as a whole. Host

 

21 Stark, 2’s fie, pp. 6e
22 Ibid pp. 6e
23 Randall and Nam, 22. 313., pp. 2 (Table I).

9
or the states in this region had their rapid develOpment during the early
1930' s, the depression years. Table I shows the growth of these auctions
from 1937 to 1952, in selected North Central States and for the United
States as a whole.

' From Table I it can also be observed that those states which had
the largest number of auction sales in the late 1930's have since tended
to level off or decrease in numbers. Those states which had little live-
stock auction development up to the late 1930's have shown tremendous in-
creases in numbers since 1937.

m June 1, 1952 there were 611 licensed livestock auctions in Richi-
gan. Of those 611 licensed auctions, only 57 were true general livestock
auctions as defined in Chapter II. The location of those 57 general live-
stock auctions as of June 1, 1952 is shown in Figure 2.

Although historical records were destroyed in the State Office
Building fire in Lansing (1951), available data2h indicates that there
were 13 auctions in 1937, 20 in 1939, and 148 in 19th. More recent data
shows 65 auctions in 19119, 70 in 1950, 67 in 1951 and 6b in 1952. These
figures would indicate that Michigan had reached its peak in auction num-
bers in 1950.

 

2’" Stark, . 933., (data for the years prior to 1937 and the year
19111;) Randall andgfiann, a. cit., pp. 2. (data for the year 1937).
Voss, o . g_i_t_., ppT'75. (data for the year 1939).
List _o_ vestock Auctions licensed in Michi an Bureau of A111-
mal Industry, Hichigan Department of Agriculture, (data for the years
19h9, 1950, 1951 and 1952). '

 

Map Auction
Code Location
No.
1 Adrian
2 Alpcna
3 Armada
h Bad Axe
5 Battle Creek
6 Big Rapids
7 Breckenridge
8 Cadillac
9 Caledonia
10 Caro
ll Cassopolis
2 Charlotte
13 Clare
lb Goldwater
15 Coopersville

16 Copemish
17 Croswell

18 Dundee
19 Escanaba
20 Fremont
21 Gaylord
2 Gladwin
23 Hart

2h Hastings

25 Hemlock

26 Hillsdale
27 Hepkins

2 Howell

2 Jackson

30 Kalamazoo
31 Kawkawlin
32 Lake Odessa

 

 

33 Lapeer

3h Lincoln 39
35’ Marion to
36 Marlette 1L].
3? Montague h2
38 Onaway h3
Figure 2.

(D r
h3
19
.oo'" 9
Cf, " "
SO 38
00 g 2.
52 /
C
3h
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16 0 '
8 55
1‘52 h?
~ ‘IL7 SQ; ‘.5
3 94
93 .6 3
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37 h! 7 g 32 O
.h1.h2 , 17
95 fl 9 93
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IDSh
s 9 9 ' 9
2 2 28 ‘
g»
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to 38 5 29
o e .
I? a .50 111 2.6 1 18
Owosso hh St. Johns h9 Standish 5h Wayland
Paw Paw hS St. Louis 50 Sturgis 55 West Branch
Ravenna L6 Sandusky 51 Three Rivers 56 Wolverine
Rockford h? Scottville 52 Traverse City 57 Zeeland
Rudyard hB Shepherd 53 Trufant

The Geographic Location

Auctions, June 1, 1952

of Michigan's Fifty-Seven General Livestock

TABLE I

CHANGES IN NUMBERS OF AUCTIONS AND PERCENTAGE CHANGE
BETWEEN 1937 AND 1952 FOR SELECTED NOR'fi-I CENTRAL STATES

 

 

 

Percentage in-
crease or decrease

 

 

 

State 1937* 195% between years
Iowa 195 , 171; -11
Illinois 139 95 -32
Kansas 139 150 8
Missouri 113 122 8
Nebraska 98 106 8
Ohio 76 76 0
Indiana M4 1 76 73
Minnesota 38 51 3!;
South Dakota 27 53 96
Ifichigan 13 G4 392
Wisconsin 3 15" 500
Total this region 885 882 0.0
Total United States 1,317 2,178 65.0

 

SOURCE:

* G. G. Randall, and L. B. Mann, Livestock Auction

Sales 32 The United States Fern—Wadi Am
Frat-Eon, menu 35, as 1939), pp. 2. ,.

*3- List of Livestock Auctions in The United States 331

s'T'ate'é", Tryp"“e'dT—: 'c‘oxfile‘d “657" t‘n‘é’ RT“: ”aid" "Re-
gistrations Section, Packers and Stockyards Division,
United States Department of Agriculture. (These 1952
numbers thus obtained checked closely with similar
figures obtained from the Land-Grant Colleges of the
above states except as noted).

,l Professor Schaars of the Department of Agriculture

Econonics, The University of Wisconsin, indicates
that in the beginning of 1953 there were 15 author-
ized sales in Wisconsin. The older List of the Bates
and Regulations Section of the Packers and Stockyards
Adidnistration indicated only three in this case.

12
During the summer of 1952, 22 of the 57 general livestock auctions

were visited as part of this livestock auction study. The selection of
the sample has been explained in Chapter III. it this time, it might be
well to look at Figure 3 and note the growth of the livestock auction
industry as recorded for these 22 sampled auctions. This chart shows
that four of the 22 auctions were established in 1950, which has been
shown to be the year for greatest growth in the state. Other trends
that should be noted are as follows: (1) The years 19111-1942 marked
the first real growth of the livestock auction business in Michigan.
(2) The munber of auctions in Michigan remained quite stable during
the middle war years of 19113-191414, probably due to O.P.A. price ceil-
ings on livestock, lack of building materials, and shortage of labor.
(3) With the end of World War II in 19115, a new growth of auctions oc-

curred. (h) This growth apparently reached its peak in 1950, and then
began to decline slightly.

Cumulative Number of Auctions

 

13

 

 

2h .1 a
?3 T- . _
22 Ar- . —+
20 +- NOTE: 7
19 dr- -4
= Yearl Addition
18 4—. I y 1
16 db— --4
15 he. .1
.1
fi
._.7
c1
.4
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.4
—1

 

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1933 '311 '35 '35 '37 '33 '39 'hO ‘hl ”42 '143 'hh 'hS 'L6 '11? '118 ”:9 '50 '51 1952
Year Established

Figure 3. The Date of Establishment and Cumulative Number of Auctions As Re-
corded for the Twenty-two Sampled Auctions Visited in the Summer
of 1952

CHAPTERII

GLObSARY OF TERPB AND MICHIGAN LAWS

AFFECTING THE LIVESTOCK INDUSTRY

Definitions Pertinent __t_c_>_ 2:13 Livestock Auction Industg. This
chapter contains a list of terms common to the livestock industry. These
are terms which will be referred to throughout this thesis, and are list-
ed alphabetically and qualified below. The latter part of this chapter
contains a brief description of some of the laws frequently referred to
in the livestock auction industry.

1. Auction: An auction may be defined as a mthod of determin-
ing price in which the auctioneer invites bids from the buyers in at-
tendance and sells the object, offered for sale, to the person who has
made the highest bid.

2. m: A male hog which was unsexed when a young pig.

3. £93 9313 93; W 931;: Calves which are one week old or
less and those calves over a week old, but weighing under a hundred
pounds.

h. Butcher Eggs: Hogs (largely barrows and gilts) carrying good
flesh and of a weight desired by the packing and slaughter industry.

5. Community Auction ectorz State emloyees who were res-
ponsible for licensing of dealers and auctions and inspecting comurdty
livestock auctions to check on their compliance with health and other
laws and regulations administered by the Michigan Departmnt of Agricul-
ture's Bureau of Animal Industry. 011 June 1, 1952 the state employed two
such inspectors.

15

6. Countgz Dealers: Country buyers who, as independent operan
tors, buy livestock directly from the farmer and sell them.for a profit
at public stockyards, packers or livestock auctions. This term'was used
‘whenever the operator actually took possession of the farmer's livestock
at the farm.

7. Counts: Trucker: Farmers and others who do hired trucking of
livestock to public stockyards, auctions, concentration.yerds and other
markets. They charged a transportation.and handling fee, but did not
take possession of the shipper's livestock.

8. Concentration 1932'; g; Assam 221.933: Local narkets which
‘were privately operated and where only privileged.groups were allowed to
buy and sell. These were largely owned and operated by packers, private
dealers, and some cooperative associations. They”were largely hog ner-
kets and were much more cannon in other states than in Michigan.

9. Decentralized Hhrketing: The selling of livestock locally
through a livestock auction, concentration.yard.or to a local packer.

lo. Qigggt_uarketing: The sale and transfer of livestock from
producers direct to packers or other slaughterers without using an.inp
termediate selling agency.

11. EESQEEHEEEEF Young pigs with insufficient growth or flesh to
be sold for slaughter purposes: they were returned to the farm for feedp
ing and finishing.

12. {33923 Heifers EEEL§52§£§3 Sometimes referred to as Eggggg
.EEEEEE? Cattle with sufficient growth and flesh to make suitable fer

feedlot feeding.

16

13. 9.9.45.3 A young female hog which has not farrowed.

11:. Livestock Auction: "Am livestock market where livestock is
accepted on consignment and the auction method is used in the marketing
of such livestocle There are many types of livestock auctions, but
the following types were considered the most important and are the most
referred to.2

(a) _'1_'_h_e_ General Livestock §£1£' Sales which handled all
species of livestock, and some, at the same time, did a
minor business in miscellaneous goods. They have per-
manent physical facilities and were often referred to as
auction sales, sales barns, sales pavilions, or conmunity
livestock auctions. There were 57 of these licensed in
Michigan on June 1, 1952. This was the grow) which was
given the najor emphasis in this study.

(b) The y_ar_k_§_t_ gay 3}: Combination £1.33: Some livestock was
handled, but the largest income was from the sale of
miscellaneous goods. There were five sales of this type
in Michigan on June 1, 1952. They each carried a 1,500

 

l .
Laws Bela _tg_ and Administered by the artment of culture
achggan fiepartmeng of Agricflt'ure, 1951, (Act-281;, E37, 237, 1%; pp.
, e

2 Note: Livestock auctions licensed by the mchigan Department of
Agriculture under authority of Public Act 281: of 1937 are listed here as
Type “a through (1. There were 6).: livestock auctions licensed in Michigan
on June 1, 1952. However, this study was based on category .3, the gen-
eral livestock sale.

 

3Laws

culture, '

(e)

(d)

(e)

(f)

c

17
dollar surety bond for the previous year meaning that
their high weekly sale for that period was less than
1,500 dollars; therefore, this group was quite insign-
ificant as a livestock market outlet.

Purebred livestock gale: This sale was usually re-
stricted to that livestock (largely cattle) which was
eligible for registration with a purebred association.
There was only one of these highly specialized sales
licensed in Michigan on June 1, 1952.

92333; §pecialized Livestock §_a_l_e_s_: Sales limited
usually to one type or species of livestock; for ex-
ample, a sale where only saddle horses were sold.

There was one sale of this type licensed in Michigan

on June 1, 1952.

Lag Auction £53193: Sales which were held at the farm
usually co-instantaneously with a sale of real estate
and other farm preperty being liquidated due to a change
of ownership. These sales were specifically exempted
neon: licensing by the state legislature's definition of
a livestock auction.3

3331133 _S;a_l_e_s_: Sales which were highly seasonal, and en-
bodied selling at a central location (often at a general
livestock auction sale barn) feeder cattle or sheep to

livestock feeders.

 

 

Relating 8? and; Administered by the Department 9£ gari-
0, PP. o

18
(s) iéasflriza—Wls erg-assesses: Sales cate-
gory which included the selling of purebred livestock
by breed associations, fat stock at fairs and livestock
shows, h-H livestock, and others of similar nature.

15. livestock m Associations: A cooperative organization
of livestock producers that assembled, loaded, and shipped their live-
stock to some central market.

16. m m: Private individuals who buy on order for dis-
tant or local packers. They charged a commission for their services. In
some cases the auction operators or their representatives acted as order
buyers for some packers.

l7. _lf_a_¢_:k_e_r_ ers: Those Were at the public terminal markets
or livestock auctions who represented packing plants as direct mloyees.

18. 11133.33 Stoc ards: As defined under the Packers and Stockyards
Acth: "Stockyard, means any place, establishment or facility commonly
known as stockyards, conducted or operated for comensation or profit as
a public market, consisting of pens, or other inclosures, and their ap-
purtenames, in which live cattle, sheep, swine, horses, or goats are
received, held or kept for sale or shipment in cameras. This title shall
not apply to a stoclqard of which the area normally available for hand-
ling livestock, exclusive of runs, alleys, or passage ways is less than

treaty thousand square feet.”

 

1‘ Regulations under the Packers Egg Stoclqards Act 1921 as amended
War Food Administration, United States Department of cum-r630. IE,

February, 1916, pp. 20.

19

19. M Markets: Stoclqards meeting the definition under eigh-
teen above are posted under regulation of the Packers and Stockyards
Administration of the United States Department of Agriculture, and must
comply with federal regulations on health, licensing, benching, charges,
record keeping, and trade practices. Only one of the 57 general live-
stock auctions in Michigan was listed as a posted market. This was the
livestock sale at St. Johns. All other auction markets were under state
regulations only. In the United States, there were 327 posted stock-
yards of all types on October 15, 1952.5

20. m: An employee of the auction who keeps stock moving
through the auction ring, past the auctioneer and more and thence to
the outlet to return to the yarding.

21. 113%: Old sows, boars, and stage are usually classed as
roughs.

22. Slaughter 95331.3: Those heifers, steers, bulls, and cows
brought to the auction, for innediate slaughter (and therefore do not have
to be accompanied with certificates as defined under the Bonine Law).

23. Slag: Bears unsexed after maturity and sold as roughs.

21:. W61 ter: A person employed by the auction to weigh in
all livestock. In Michigan he must be licensed and registered with the
Bureau of Weights and Measures.

 

 

5 List of Stoc ards Posted Under the gaskers and Stoc ds
Act 1921 fioEctIon and Mmmnfifiatfin, United §$s
nt of Agriculture, October 15, 1952.

20
2S. Yardmen: Persons employed in loading, unloading, penning and
driving livestock as part of handling Operations at the auction.

Lars Frequently Referred to in the Livestock Auction Industry

1. Auction La; 23; the Livestock Auction L53: Public Act 281: of
the 1937 session of the Michigan Legislature with later amendments.6
This was an act to prevent the spread of infectious diseases of livestock.
It required those engaged in buying, selling, and transporting livestock
to be licensed and bonded by the Department of Agriculture. It also pro-
vided for weighnasters, and inspection and disinfection of sales yards
and vehicles. Its major provisions that needed defining in this paper
were as follows:

(s) 133113; Licens : Those individuals engaged in bwing
and selling, or transporting, but not operating or con-
ducting a livestock yard where livestock is kept and
sold at public sale were to be licensed as dealers for
five dollars per year. Those Operating such a livestock
yard were charged ten dollars per year. This latter pro-
vision included livestock auction operators.

(b) Licensigg g_f_ Weighmaster: Where am livestock is pur-
chased or sold by weight: such licensees were required
to employ a registered weighmaster (see previous de-
finitions) to do all their weighing.

 

6 Lents relat to _a__nd Administered artnent of ricul-
Inch ch'i'é'é'n 347“" of Agriculture,1%1-,_(Ao 2 ,377ég'7'Ifi),

£21311.

21
(c) Bondig 9}; Auctions: Besides being licensed, each dealer

or broker operating a livestock yard or livestock auction
must for the period of his license (October 1 through the
following September 30) obtain a surety bond, to indem-
nify persons from whom livestock was purchased or for
whom livestock was sold. These bonds ran from a 1,500
dollar minimum to a 15,000 dollar maximum. This amount
was based on the amount of the highest weekly sale re-
corded during the previous yearly period, and the bond
usually amounted to an amount one thousand dollars over
this high weekly sale for those auctions bonded less than
the maxim amount.
2. The W keg: Act 157 as amended by the 191:9 legislature:7
Cattle over twelve months of age could not be sold or otherwise disposed
of unless they were accompanied by an official certificate of record,
issued by the Director of Agriculture, showing that they had passed an
official test for Brucellosis (Bang's disease) within thirty days prior
to the sale. This law made the seller responsible for furnishing this
record, but the law did not apply to steers or other cattle disposed of
for slaughter. However, even those sold by auctions for slaughter must
be accompanied by a sales slip and must be killed within ten days in most

cases.

 

7 ma, (287.21a, Section 21a) pp. 76, 77.

22

3. The 1333222 Lag: Act 3110 of the 1913 legislature, as amended
in 1952.8 This 'Deacon Law' made it unlawful to transport a calf under
one week of age in inter or intra-state commerce, or to sell for trans-
portation any calf under one week old, except from one tanner to another.

1:. 392%. gig Unloadieg L399 Swine could not be sold or re-
moved fron a public livestock yard unless immediately slaughtered. They
must be killed or delivered at inspected yardings within seventy-two
hours following removal from the public yarding. There was no objection
to a sale outside the auction building provided the swine was loaded from
one vehicle to another one in which they were removed from the premises.
Feeder pigs and breeding stock, going back to the farm, were therefore
transferred behveen vehicles at many of the auction yards in Mchigan.

5. Immature Eea_l_ Laue: Act 3140 of the 1913 legislature makes it
unlawful to sell for human consumption the carcass or meat of a calf less

than four weeks old.10

 

3 ma, (289.251, Section 1, supplement) pp. 172.

9 Administrative Code of 19111:, (Section 6 of Regulation 119),
Michigan Department oTAchuIt'ure, (Himeographed) .

10 Laws relatieg _t_e 31.2 Administered ye the artment of -
culture ra'EKigen Department o—f Agfi—riculmre, 153T, D—?Alctn3filmof_1 ,
289.251) pp. 172.

CHAPTER III
PROCEDURE IN SEIECTING A REPRESENTATIVE SAMPLE

There were 611 licensed livestock auctions in Michigan on June 1,
1952. It was impossible to visit every one of the licensed livestock
auctions in Michigan. If this had been possible, it was not necessary
to visit all 611 licensed auctions to get a true representation of the
typical operations of mchigan's livestock auction industry.

It was possible to classify the general livestock auctions and
to select from them a stratified purposive sample of representative gen-
eral livestock auctions with the aid of information obtained from the
Michigan Department of Agriculture, mchigan Department of Securities
and Corporations, interviews with the Community Livestock Auction In-
spector, and from answers to a preliminary mail questionnaire sent to
each of the 611 licensed livestock auctions in Michigan.

01 the basis of information so obtained, a universe of 57 gen-
eral livestock auctions was selected as a base for the study of Inchi-
gan's livestock auction industry. Furthermore on the basis of this
same information five of the 611 licensed auctions were placed in the
miscellaneous auction classification; one‘ auction was classified as a
purebred sale, and one auction was classified as a saddle horse sale.

The 57 general livestock auctions which were included in the uni-

verse of stuw were stratified on the basis of geographic location, size

21:
of business, and type of ownership. This stratificationwas made pos-
sible from information obtained as follows:

1. The geographic location of each of the auctions, was obtained
from a list of bonded and licensed auctions, maintained by the Bureau of
Animal Industry of the Michigan Department of Agriculture.

2. The eiee ef; business as indicated by the high weekly sale and
the amount of bond carried by each of the 57 general livestock auctions,
was obtained from the Bureau of 1mm Industry of the Michigan Depart-
ment of Agriculture. For those not reporting a high sale, the Commity
Auction Inspector estimated their high weekly sale for 1951.

3. The page e; ownership for each of the 57 general livestock
auctions was obtained from the list maintained by the Bureau of Animal
Industry of the Michigan Department of Agriculture. The corporations
were verified by the mchigan Corporation and Securities Commission.

There were 25 responses to the mail questionnaire from 5? auctions
in the general livestock auction category. This information was used to
make a comparison with e Lr_1_o_r_i_._ kno‘fledge on type of ownership, and size
of business. The 25 mail responses on type of ownership agreed in every
case with the listing made from advance information. Therefore, it was
concluded that the 57 general livestock auctions could be correctly
stratified in this respect. The reply to the question on the average
size sale for June, 1952 seemed to correspond quite closely with informa-
tion which had been previously obtained on these auctions' high weekly

sale for the year 1951. Thus, it was concluded that it was correct to use

25
this high weekly sale as a base for stratifying the universe in respect
to size of business} The prior information on location was already
quite conclusive.

The desired stratification, available information, and desired
accuracy were discussed with the statistician at the Michigan State Col-
lege Agricultural Esperiment Station. It was confirmed here that a
sample of 22 of the general livestock auctions was more than ample to
give a true representative picture of Michigan's livestock auction in-
dustry.

The 22 general livestock auctions were selected purposively from
the stratified universe of 57 general livestock auctions as follows:

1. Location: The first basis of stratification of the 57 genera"
a1 livestock auctions was location. Each of the general livestock auc-
tions was placed in a cell by type-of-farndng area in the state. The
type-of-farming area on a county line basis was used as set up by the

 

1 A linear regression line was plotted on a scatter diagram re-
lating high weekly sale in 1951 to average June sale 1952 for the 22
auctions selected for the purposive sample (this included 19 of the
25 original mail reaponses). The resulting correlation coefficient
calculated from this data was .9hh, which showed a very close cor-
relation bet’waen-high sale for 1951, and June, 1952 average sale.

It was concluded that it was correct to use high sale as an indication
of an auction's relative size of business in this stratification.

26
farm.management section of the Department of Agriculturalfificonomics.2
By using this concept and selecting auctions within these typedof-farm-
ing areas, it'was assured that a good geographic distributicnnwas being
obtained.

Furthermore, it meant that any variations between.auctions oc-
curring because of differences in geographic location (as it affects
type of livestock, seasonality of receipts, availability of labor,
concentration of livestock and competitionnwith other’markets) would be
accounted fer through this type of distribution. The type-ofbfarming
areas and the number of auctions in each area are as shown in Table II.
the actual delineation and location of‘the general livestock auctions
within each type-ofhfarming area may be seen by referring to Figure h.

The sample of general livestock auctions was selected as follows:

(a) One auction was selected from each type-of-farming area
in the Lower'Peninsula (this required a sample of 13
auctions, for all type-of-farming areas in the Lower
Peninsula except area thirteen contained at least one
auction).

(b) One auction was selected from.the Upper Peninsula
(type-of-farming areas 15, 16 and 17). Only two

 

2 s. B. 11111, Mes-ef-Famg Areas is Michigg, Ifichigan Agri-
cultural Experiment Station Bulletin.206 (revised June, 1939) pp. 68:
This Bulletin was over thirteen years old, but it was believed to be
sufficiently accurate for the desired geographic distribution of this
prOJect.

27

17

 

Type of Farming Number of

 

 

Area ‘___ Auctions
1. Corn and Live-
stock h
2. Small Grains and
Livestock 6

 

1. Southwest Fruit
and Truck Crops 1
1:. Poultry, Dairy and
Truck 8
6
2

 

 

5. Dairy and General
Farming
6. Dairy and Cash Crops
7. Dairy, Hay and Spec-
ial Crops 3
8. Beans, Sugar Beets
and Dairy 7
9. Cattle, Sheep and
Forage h
10. Central Potato and
Dairy h
h
2

 

 

 

 

 

 

' 11. Northern Fruit and
Dairy

12. Northern Potato
and Dairy

13. General Self Suf-
ficing and Part-

 

 

 

 

 

time 0
1h. Cattle, Potatoes,
and Self-Suffic-
ing 11 ‘
15. Cattle, Hay and *
, Spring Grain 1
lo. Dal and Potatoes 0
17. Pota es, Dairy,
Part-time 1
Total Auctions g7

Figure h. Distribution of the Fifty-Seven General
Livestock Auctions in Michigan, Classified
by Type-of-Farming Area, 1952

28
auctions were located in the Upper Peninsula, and both
were under the same ownership. This added another auc-
tion to the sample size.

(c) Type-of-farming areas 2, h, S and 8 had more than four
auctions per area; therefbre, at least two were selected
from.each of these areas to properly weightthe sample in
preportion to the total population. This required four
more auctions in the sample size.

(d) In order to get the proper proportion of small individ-
ually owned businesses in the sample, two auctions were
added as follows: one each from area eleven and area
fourteen. Another auction was selected from.area two
to complete the small partnership representation, and
another from.area eight to complete the large individ-
ually owned auction category. This added four more
auctions to the sample size.

The sample thus selected contained 22 of the 57 general livestock
auctions in.Hichigan, or 38.6 percent of'the state's general livestock
auctions.

The sample of auctions selected to be visited represented type-of-
farning areas in the prOportions listed in Table II. Figure 5, shows the
geographic distribution.of the 22 sampled auctions on an outline map of
lflchigannwith the type-of-farming areas delineated (the red dots on.the

map signify sampled auctions).

17 Q5

 

 

 

 

 

 

 

 

 

 

 

 

0’
0 ®
Number Number in
TFA Auctions Sample 6?
—" " $
1 h 1 1h
2 6 3 ‘ i.
3 l l C'
h 8 2 12 13 l O
2 6 2 . —
2 1
7 3 l C) 1‘9
8 7 3 1
9 ’4 l a o
10 h 1 a O
11 u 2 10 O 9
12 2 1 . O O
113; g 0 o
2 0
1S) 0 ' 0
16>U.P. 2 1 0 0 0 O c 8
17) O O
9 0 O

 

or 5 o b O

. O 0 a
Q = Auctions visited. A ‘9
3 0 0 2 0

Figure 5. The Fifty-Seven General Livestock Auctions in Michigan Classified by
{yEe-of-Farming Area, Along with the Twenty-Two Such Auctions Sampled,
922

 

 

aw eacmcdoom_noaeb \
6.83823 mo Eastman gametes .NmmH .33. $8334 €8.3qu mm :3 a.
.8 :3 mmaHUgg usage EN :3..de 833m

 

 

 

 

 

 

 

 

 

 

 

 

assumes HmépHsoEma amnesia: ea 23.: fi 384 a mo mug .Hdm .m .m * £258
9mm 0.03 NN am omega: .8 H.309
A w.H o H Senate Ba 5.3. .8338 .5
02 o.o o o 833% e5 EH8 .oHv x
A 9H H H «59% mate. as. has .338 .mHv
om o; N e . mutated?» Ba 3333 .338 3H
o 0.0 o 0 gauge was meaoammsnuflmm .Hfimaoo .mH
om m.m H N has. as 333 Efitoz .NH
om 3. N 4 has. on. path fiofiaoz .HH
mN o.» H : EH3 as 33% Hanson .oH
mN o; H a omega as asst .338 .a
Na m.NH m a. Ede as 3.3 new... .238 .w
mm m.m H m 398 Hates. as he .hHan .N
om m.m H N 398 e80 as. been .9
mm m.0H N 0 means.“ Henoemm e9. EH3 .m
mN as: N a were aqua... on. $33 .EHuom .e
8H 9H H H .83 asap as 35 pmofifiom .m
om m.0H m o topmofiH as 233 HHesm .N
mN o; H e c.8233 as. 58 .H
acOHpose fleece escapees aspen coagsme seas and oewz noospz
means no n.09mpm Mo nonscz honscz eoh<
escapee aceoaom
as nausea
**ncoޢos< xoopmobaq scone measumm mo coma

 

1"
L

NmmH .sza. Jame madam
.6 mg 8 $3803 ceramic 5.859
E monaoea Moog game am so 5233 was

HH Manda

31

2. Type 93 Ownership: The purposive sample, besides meeting the
requirement of at least one auction from each type-of-farndng area in
the Lower Peninsula, met qualifications on type of ownership as follows:

(a) In the total universe of 57 general livestock auctions,
there were 18 auctions individually owned, 21 corned by
partnerships and 18 owned by corporations.

(b) In selecting the sample, each type of ownership in the
sample was given as nearly'as possible the same weight
as in the total population. Thus, the final sample con-
tained six auctions owned by individuals, eight owned by
partnerships, and eight owned by corporations (Table III).

3. §_i_z_e_ of; Business: The third type of classification used to
stratify the total pepulation and thenceforth as a basis'for the selection
of a representative sample was the size of business.

The 57 general livestock auctions were classified by size of busi-
ness using data on the high weekly sale for the auction year 1951 (Sept-
ember 30, 1950 through October 1, 1951). Four categories were used for
stratification.

The first category was classified small business and included all
those auctions with a less than 25,000 dollar high weekly sale for 1951.
The second category was classified medium business and included all those
auctions with a high weekly sale in 1951 between 25,000 dollars and 149,999
dollars. The third category was classified l_a__rg_e_ business and included
all those auctions with a high weekly sale in 1951 bebteen 50,000 dollars

32
TABLEIII‘

THE 57 GENERAL ummx AUCTIONS, AND
THE 22 SAMPLED AUCTIONS FROM THIS
POPULATION CLASSIFIED EI TYPE OF
(NNERSIIP, AND IMPORTANT QUANTI-
TETIVE RELATIONSHIPS TO EACH OTHER

 

 

 

 

 

 

Type of Ownership Total population Sample
Number Percent Number Percent
Individuals 18 31.6 . 6 27.2
Partnerships 21 36.8 8 36.1;
Corporations 18 31.6 8 36.1;
Totals 57 100 .0 22 . 100.0

 

and 7h,999 dollars. The fourth category was classified very large busi-
ness and included all those auctions having a.7S,OOO dollars or none high
weekly sale in 1951.

In Iflchigan it was found that of the total population of 57 Ken-
ersl livestock auctions 18 were small businesses 3 17 were nediun busi-
nesses; six were large businesses, and 16 were very large businesses.
Because there were so few in the cell labeled large business this is
shown conbined with the very large category in new of the later clas-
sifications in this thesis. When this is done it is labeled 'large'
business.

In selecting the sample, each size of business in the sale was
weighted as nearly as possible to its weight in the total population. This
resulted in a sasple of seven small businesses, seven sodium businesses,

33
three large businesses and five very large businesses. Table IV shows

this quantitative relationship between the sampled auctions and the
total population.
TABLE IV
THE RELATIONSHIP BETWEEN THE SAMPLE

SIZE OF BUSINESS AND THE SIZE (1“
BUSINESS IN THE TOTAL POPULATION

 

 

Size of Business Total POpulation Sample Population

 

 

 

 

 

 

Number Percent Number Percent
Small 18 31.6 ‘ 7 31.8
Medium 17 29.8 7 _ 31.8
iii-Plagues“ 12m Tim-6 .. 2” give
Total 57 100.0 22 100.0

 

 

 

 

To further verify the validity of the selection of the sample on
the basis of the size of business the arithmetic mean of the pepulation
and the arithmetic mean of the sample were compared with respect to the
actual high weekly sale reported by these auctions in 1951.

The 57 general livestock auctions' high weekly sales averaged
52,091; dollars. The 22 samled general livestock auctions' high weekly
sale averaged 51,620 dollars. This was a difference of only four hun-
dred and seventy-four dollars bemoan the two means. Within each size

of business category, 0. similar relationship was evident (Table V).

 

 

 

 

 

 

 

:3 4; 034m a .3ch a .33 no 8822
. .. 23.3”. . mafimfi a . 93.3 .33 he» owes
Em m “mafia u 06 8280.3 m m RfmoJo essay. .
cadmi- eoiom «8.? 53a:
5.4 .. a 80.3 a 5%? a 32m
Andes edge , do
.. gagged nogwgmoa 32335
uses soapwdfionv 398m H.309 no 03m

832 a.“ sensuous

. RS .38 583 swam «o swans:

 

wfiomaao mNHm em HRH E
3% edema :on Saga 8 Ease
«2883 En mm may 92 ESE?
E 3883 589:5 Emu R an.

> ad“.

35

The three major characteristics which could cause variations be-
hreen livestock auctions were location, type of ownership, and size of
business. Inasmuch as these were the same characteristics which were used
to stratify the population, and since it was shown that the sample se-
lected represented the total population quite closely in all three cate-
gories; it was concluded that the 22 livestock auctions (38.6 percent of
the state's total) selected as a purposive sample gave a true representa-
tive picture of the livestock suction industry in Michigan.

The 22 seapled auctions were visited during the latter part of
July and during the month of August, 1952. Everyone of the 22 opera-
tors so selected and visited cooperated fully with the author. The re-
sults obtained from the answers to the schedule used in the interviews,
and results obtained tron observations made while in attendance at each
of the 22 sales are presented in the following chapters to give a pic-
ture of typical operations in the Michigan livestock auction industry.

CHAPTERIV

GECBRAPHIC LCL‘ATION AND SALE DAY CQIPETITION
OF MICHIGAN AUCTIONS

Location _o_{ _t_h_e_ Auctions: From some of the maps presented in the
early chapters of this thesis, it was noticed that the auctions were
widely scattered throughout the state. However, it was also noticed that
a large number of these auctions seemed to be located in the Southern
part of the Lower Peninsula. This would be emected by one with know-
ledge of the state's livestock concentration. mis concentration and
relationship behveen areas of the state may be affirmed by converting
the livestock numbers of the various species into a single number for
each type-of-farming area. This was done In? using the concept of aninal
units.1

A map of Michigan (Figure 6) shows these animal units as computed
for each type-of-farming area, and lists the number of auctions, slaugh-

terers, and terminal markets located in each type-of-fandng area. There

 

1 R. D. Jennings, Animal Units of Livestock Egg The
United States Department of Agricfitur'ej' Bureau of Agric tural Econo-
mics, F.M. 614 (19119) pp. 15. The weights used were the animal-nut
factors for grain and roughage consuming livestock fed in a year. The
base (1.0) for the factors was the quantity of all feeds including pas-
ture expressed in feed units used by the average null: cow in the United
States in a year. As Michigan milk cows were fed higher than average
the base was raised to (1.1). Other factors used included: Heifers
and calves (.5), Beef cows, 2 years and older (.8), Cattle on feed
(.7), Sheep (.15), and Hogs fed during the year (.17).

 

 

 

  

 

 

 

 

 

 

 

 

 
  

37
(U. P.) Areas 15,16, and 101,271 A.U. (i
1 2 Auct. 0
Ll? Pa ks
. (D
0 “DD Q
0
area 12
59,1147 1.0
,,<1
5 Area 13
71 A.U
’ 8 Auct.
59,b70 AeUe Area 3 . 100,851 AeUe
h Auct 11 3 Auct
25 Pac . Area 9 23 Pack
3‘ b01 . &’17O Act's
.gm 5. Area 10 h Auct.
(A.U. U Animal Units)* 102 265 A U 13 Pack.
(Auct.= Livestock Auction) ’ h A. g; ‘
(Pack.= Packers and us
Slaughterers)** 29 Pack. Area 8
(U.P. 3 Upper Peninsula) 218988; fiag£
Ara, h 61 Pack. Tea 7
123,282 A.U Area
Total in Michigan 8 Auc , Area 5 b
8 P . '
1,628,2gg fifiigiingnits 5 ac 315,722 A.U. 10o,?37 A. .
Auct. C Auc‘,
23 Packers 68 Pack. 7: Pac -.
1 Terminal Mar- 1 TE minal

ket
(13,381 AeUe

l Auct.

2h Pac

  

 

 

 

 

136,319 A.U.
Area 3 6 Auct.
Pack 7
Area 1h3,97h A.U.
1 h Auct.
, _ 4_1_ 31 Pack

  

Source: * Computed from number of livestock by counties, U.S. Census of Agri-

culture, 1950 .

** R. Kramer, Unpublished summary from Office of Price Stabilization for
the year 1950 (Michigan State College) (map).

Figure 6. Animal Units and Decentralized Market Outlets for Each Type-of-Farming
Area So Delineated in Michigan.

 

38

seemed to be a definite positive relationship betteen the location of
the number of animal units and,the outlets for them. This indicated
that these localized market outlets increased as the number of live-
stock in an area increased. These outlets listed did not account for
all the potential outlets for the livestock, nor did they shut the dif-
ferences in the size of various outlets as the amount of livestock in
an area increased. However, these were the major decentralized outlets.

When the animal units in each type~of-farming area were plotted
on a scatter diagram with the number of outlets (auctions, packers,
terminals); and,a straight line regression equation was fitted to this
diagram a fairly close fit was noted. When a correlation coefficient
was calculated to verify the closeness of this relationship between am.-
Ial units and available market outlets for each area, the result obtain-
ed was a l .77. This showed a fairly high positive relationship, indi-
cating that when the numbers of animal units in an area increased the
market outlets increased also.

A less detailed, and therefore clearer picture of the state's live-
stock concentration and its significance on auction outlet location was
obtained by dividing the state into Upper and Lower Peninsula, and then
dividing the Lmer Peninsula into Northern and Southern halves. These
three large areas provided a basis for generalization on inter-area dif-.
ferences in numbers of livestock and livestock auction outlets. The
division of the Southern half of the Lowor Peninsula from the Northern

half of the Lower Peninsula follows county type-of-farming area boundary

39
lines, and the line of delineation roughly approximates a line between

Bay City and Muskegon. The Upper Peninsula area was separated by the
natural water barrier (Figure 7).

The broader classification combined somewhat similar type-of-farm-
ing areas in respect to numbers and kinds of livestock. It was realized
that within each of these three areas so delineated there was still much
heterogeneity, but far outweighing this disadvantage was the ability now
to generalize. The problem of having small localized type-of-farming
areas where nary outlets were used over the localized boundary lines and
where so may detailed type-of-farming differentiations had to be con-
sidered separately was that the human mind could not comprehend these
differences, nor should it have to for it is the preper role of classifi-
cation and categorization to make generalization possible. It was be-
lieved that much the same marketing conditions prevailed within each of
these areas so delimited. While the differences between areas was con-
sidered significant enough for the delineation .

1. The Southern half of the Lower Peninsula, so delineated, and
henceforth referred to as the Southern Michigan Livestock £123. contains
type of farming areas one through eight. This Southern Michigan Live-
stock Area was the heavy livestock populated area of the state. The
area also had the heaviest pOpulated cities in Michigan. It had, besides
the livestock auctions, numerous in-state market outlets including the
terminal market at Detroit. It also had access to the big markets at

Chicago, and other out-state markets in Indiana, and Ohio.

to

2. The Northern half of the Lowor Peninsula, so delineated, and
henceforth referred to as the Northern Michigan Livestock L133 presented
a different marketing picture. It had smaller human and livestock popu-
lation, and was located farther from the main in-state and out-of-state
population centers. The type-of-farming areas within this region in-
cluded areas nine through fourteen. This Northern Livestock Area with
its limited market outlets of other types was most dependent on its live-
stock auction industry.

3. The third area of the state delineated was the Upper Peninsula,
here called the 9213.3. Peninsula Livestock A332. This area was compris-
ed of type-of-farming areas fifteen, sixteen and seventeen. It was an
area of very sparse human and livestock population. The major job of a
market outlet in this area was the assembly of the widely scattered,
sparse livestock population. The lack of concentrated livestock product-
ion had deterred the establishment of may market outlets and the auctions
located in this area were very important to these limited number of pro-
ducers having access to them.

The division of the state into these three livestock regions, and
the amount of livestock (in terms of ardmal units) along with the number
of decentralized market outlets are shown in Figure 7. The Southern Michi-
gan Livestock Area had 73 percent of the animal units of the state, and
65 percent of the livestock auctions. It also had over 72 percent of the
slaughterers. The relatively fewer auctions (in relation to livestock popu-
lation) in this area was emlained by the nearness of the area to the num-

erous other types of in-state and out-state markets.

    
   

UPPER PENIN-
SULA LIVESTOCK AREA

  

Animal Units

 

 

 

 

101,271 Auctions Packers & Slaughterer
6.2% 2 h78 9%
3.5% ' A
it
, C) fill
0
<9
(3
NORTHERN MICHIGAN
£?£! LIVESTOCK AREA
NOTE:
All percentages appearing Animgl Units AEfiégflflé.
in this figure represents 33 ’323 1
the percent of state's 20' % 31-5%
:i::: in each area so de- ’eckers and Slaughterers

99
18.7% \q\\

SOUTHERN MICHIGAN L JP‘CTOCK
‘ AREA

 

Animal Units Auctions Packers and Slaughtereis

1,188 ,6937 37 38b
73% 65% 72.h%

 

 

I
v——

Source: Cartographic Generalization as preposed by G. L. Johnson, Relative
Importance of Alternative Market Outlets used by_hfichdgan Farmers in
SellingULivestock, Unpublished Master's Thesis, Michigan State College,

19h2, pp. 11.

Figure 7: The Three Main Livestock Areas of Michigan with Numbers and Percentage
of State's Auctions, Animal Units, and Slaughterers in Each

 

 

h2
The Northern Michigan Livestock Area had only 20.8 percent of the

livestock in the state (in terms of animal units). Furthermore, it had
only 18.7 Percent of the state's slaughter plants. However, 31.5 per-
cent of the state's livestock auctions were located in this region. There-
fore, livestock auctions (quantitatively) seemed to be relatively more
important to the farmers in this Northern Livestock Area than to those
farmers in the Southern livestock Area. For this Northern Livestock Area
did not have as nary alternative markets or the concentrated livestock
population needed for individual farmers to ship volume loads long dis-
tances. It was believed that as the farms in the Northern Livestock Area
were smaller, often of a subsistence or part-time level, that many of the
arrivals at these Northern auction markets were of the odd-lot type.
This meant that the auctions were acting as concentration or assembly
points for more distant shipments. It was this feature of the auctions
which seemed to make them especially adaptable to the needs of the pro-
ducers in this area.

The Upper Peninsula Livestock Area had only 6.2 percent of the
state's livestock (in terms of animal units). This livestock was wide-
ly scattered over a vast area; making it difficult to justify an auction
in nary parts of the Upper Poninsula. There were two auctions (or 3.5
percent of the state's tutu) in this area. Also 8.9 percent of the
state's slaughter plants were located in this area. In the Upper Pen-
insula, one would hypothesize a larger number of auctions due to the

increased distance to central markets, but apparently the scattered

1:3
livestock and great distances needed to accumulate any reasonable con-

centration of livestock for marketing, over-rode the local people' 8 need
for this decentralized method of marketing.

It was shown that the large livestock numbers in the Southern
Livestock Area warranted the building of decentralized livestock auction
markets, but it was further seen that in proportion to the amount of
livestock concentrated in this area they were limited in numbers. This
was largely because of the nearness of other outlets for the farmr's
livestock as one approached the huge population centers of Chicago and
Detroit.

The Northern Livestock Area was the best suited to the location
of the auction type of market outlet and hence auctions were proportion-
ally more successful here. Previous fern outlets for livestock had in-
cluded some sales direct to local slaughter plants, concentration yards
and shipping associations, but a large number were handled by dealers,
an unsuitable mthod of marketing. For the dealer was an experienced
buyer who did business with a less experienced seller (the farmer) am
he often found it possible to use his greater knowledge of current
prices and price trends, along with his experience at Judging weights
to give the producer a very unfair price for his livestock. The local
auction provided a place where the producers could sell by weight and
put hi: in a better position to keep tract of current price trends.

When the size of the auctions in each area was taken into ac-
count, a pattern as presented in Figure 8 was obtained. It was found

. d9

Size of Auctions

 

Small Medium ‘Large'*
Percent of state's auctions O . 0
Percent of area's auctions 0 100.0 0
Number of auctions in area 0 2. O

R an
ab

 

UPPER PENINSULA LIVESTOCK AREA

 

 

00° C
CD
NORTHERN MICHIGAN LIVE-
0 STOCK AREA
1’
/
Size of Auctions
Small Medium 'Large'*
Percent of state's auctions hh.h 35.3 18.2
Percent of area's auctions hb.h 33.3 22.2
Number of auctions in area 8. e. h.

 

SOUTHERN MICHIGAN LIVhfiTCCK
AREA

Size of Auctions
Small Medium 'Large}*
Percent of state's auctions 55.6 53.0 81.8

 

 

Percent of area's auctions 27.0 2h.3 h8.7
Number of auctions in area 10. 9. 18.
a

 

fi

*For the purpose of this analysis the large and very large auctions as
differentiated under sampling were combined. The title given to this
combination was 'large'.

Figure 8: Three Principle Livestock Areas of Michigan with Auctions in Each
Area Classified by Size of Business

16
that in the Southern Livestock Area 148.? percent of the auctions were
'large'2 businesses. Fm'thermore, 27.0 percent of the auctions were
classified small businesses, and 2h.3 percent were classified as med-
ium businesses.

Comparing the Southern Livestock Area with the other two live-
stock areas of the state; it was found that this Southern Livestock Area
had 81.8 percent of the state's 'large' auctions; at the same time it
contained 55.6 percent of the state's small auctions, and 53.0 percent
of the state's medium auctions.

The two auctions located in the Upper Peninsula were medium in
size, and constituted 11.? percent of the state's medium auctions.

In the Northern Livestock Area, Huh percent of the auctions were
small businesses; 33.3 percent were medium businesses, and 22.2 percent
were designated 'large' businesses. It was further found that Nut;
percent of the state's small auctions, 35.3 percent of the state's med-
ium auctions, and 18.2 percent of the state's 'large' auctions were

located in this Northern Livestock Area.

 

2 'Large' as here designated includes the large and very large
categories as set forth in Chapter III. This appeared to be a lore
meaningful classification for use in this Chapter since only six of
the 57 general livestock auctions in the state actually fall into the
large category. The use of small businesses and medium businesses
is the same differentiation as presented in Chapter III.

he

_S_al_3 is; cognition betateen auctions: The 57 general livestock
auctions were stratified according to sale day in Figure 9. The lost
canon sale day in Michigan was Monday, when 1h sales were held.

From Figure 10, it can be seen that there was very little ceIpeti-
tion between closely contiguous sales. Much of this lack of sale day
competition may be attributed to the fact that nary contiguous sales
were owned by the same ownership entity. They used the sane help at each
different location, and did not desire to compete with themselves for
buyers and sellers. This multiple auction ownership pattern may be seen
by referring to Table VI.

It was found that 10 auction ownership entities had interests in
23 livestock auctions in Mchigan. The other 31; general livestock enc-
tions were owned by individual ownership entities . For the whole in-
dustry, M; auction ownership entities controlled 5? general livestock
auction outlets.

Sale day cometition within the sane area, besides being control-
led by multiple auction ownership, was further controlled because of the
fear or willingness of Operators in contiguous territory to engage in
direct conpetition for sellers and buyers. Auction operators recognized
the fact that the number of bwers and sellers in a given territory were
limited; therefore, they tried to adjust their sales so additional buyers
may attend, and so that sellers do not have bro sales to choose between

on the sane day.

 

 

 

11 .v'

2* “ Wednesday

   

SYMBOLS:
Sale Dav

Menday
Tuesday
Wednesday
Thursday
Friday
Saturday

Figure 10:

e
(7
0'
D
Q . 6
08
f,
e
. 0 a9
3 e
e
S c
,3 e
=,- $ .‘9’
9o
0 o c
e 9 69
so 0 e
0e

 

Sale Day Competition Between Contiguous Sales

he

119
TABLE VI

AUCTION OWNERSHIP ENTITIES AND NUMBERS 0F AUCTIONS
OWNED BY EACH ENTITY CLASSIFICATION

 

T

 

 

 

 

 

Number of
separate Number of Total number
ownership Type of sales per of auctions per
entities ownership entity classification

h Individual 2 8

2 Partnership 2 h

1 Partnership 3 3

1 Corporation 2 2

l Corporation h h

1 Cooperative 2 2

Corporation
10 23

 

Something of the magnitude, or more nearly the distance, of sale
day competition.may be seen if one looks at the answers received.fron.21
of the 22 sampled auctions to the question: 'Within what distance to your
market did the largest percentage (approximately 80 percent) of each
species arrive? Table VII shows the responses received from this ques-
tion.

The largest percentage of the auctions (at least 60 percent of the
auctions reporting for all Species except feeder'cattle) reported that
they got the largest percentage of their livestock'within a 39 mile rad-
ius of their auction. This varied.from.8ljpercent of the auctions re-

porting they obtained the largest percentage of their feeder pigs and

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51
sheep and lambs within this 39 mile radius to 52 percent of the auctions
reporting they received the largest percent of their feeder cattle with-
in this 39 mile radius.

Apparently feeder cattle came the longest distance; many coming
from the'western states in car lot shipments, and from Northern.Michi-
gan to the auctions in the Southern Livestock Area. Feeder*pigs and
sheep and lambs came from a close proximity to the auction. Slaughter
cattle and.butcher hogs came from within a medium.radius of the auction

market (0 to h9 miles).

CHAPTERV

SEASONALITY 0F LIVESTUJK MOVEMENT THROUGH
SELECTED MICHIGAN AUCTION MARKETS

Considerable seasonal variation existed in receipts of livestock
at the livestock auction markets of Michigan. The average monthly re-
ceipts of calves, cattle, sheep and lambs, and hogs combined at eleven
of the 22 sampled auctions from which records were available during the
period of July 1, 1951 through June 30, 1952 are shown in Figure 11.

The seasonal pattern for all livestock received at these eleven
auctions shows that the peak month was October. At this time approxi-
mately 13 percent of the livestock was marketed. This was followed by
a decline especially in the months of December and January. Receipts
increased somewhat in February and the spring peak was reached in March
when 9.6 percent of the livestock was marketed. Thereafter the volume
marketed declined until the low point of the year was reached in July
when only 6.1 percent of the livestock was marketed.

This pattern shows receipts for only a one-year period, and must
be Judged on the basis of this limited data. However, there was no in-
dication that this fiscal year was not a fairly representative year in
Michigan. Feed supplies were not short nor were there any unusual sea-
sonal prices evident which might have affected the movement of this

livestock.

53

 

 

Percent

 

All Livestock

_ _ xir _ _ L

-

‘ll'v

' It“. ds‘.§‘3 4n .-
. n . u.) ,. k . ‘-..

I'-‘ .

-.'€l' It

r. 'I'II 1|...

‘ ‘\I“"{!3.clu \ 3.}. 1“]S‘Qfl m":
‘ ‘ u ’1 . \lt. . u
\l\ c
O '
. t.
,d«.0..olllllp . a. .
I- .“ t1‘vV'ivl.

 

v, t‘l‘-‘

 

 

12

10

Graphed by percent of annual total marketed monthly.

NOTE:

Average Seasonal Distribution of All Livestock Marketed Through
(Eleven) Sampled Auctions (Fiscal Year July, 1951 To June, 1952)

Figure 11.

Sh

When the seasonal distributions of the individual species were
examined, it was found that the seasonal distribution of all cattle nar-
keted through these auctions (Figure 12) corresponded fairly closely to
that of all species combined (Figure 11).

The largest number of cattle was marketed in the fall months of
September and October. The peak cattle month when 11: percent of the an-
nual total was marketed occurred in October. The smallest number of
cattle came to these auction markets during July (6.5 percent) and Dec-
ember (6.7 percent).

Calf receipts at these eleven auction markets were more stable
through the year than for any other species or the receipts of all live-
stock marketed through these same auctions. April, when 10.6 percent of
the annual total was marketed, was the peak month for calf marketings
through auctions. This was a period when a large number of dairy cat-
tle freshened and veal calves from these dairy-type animals began to
move through the auctions. From the month of April, there was a grad-
ual decline in calf marketings until the month of July. The period from
July through November was fairly stable, with the exception of the slight
upswing during the month of October. The seasonal low in calf receipts
was in December, when only 5.9 percent of the annual total. was marketed.

Hog receipts at these eleven auction markets shaved two seasonal
peaks. The highest, when 11.5 percent of the annual total was marketed,
occurred in October. The secondary peak (when the fall pig crop was
marketed) was in March. At this time 11.1 percent of the annual total

55

 

 

   

 

  

 

 

 

Percent 7
20 —-h- r—
Cattle Calves
18 .1_ it“
16 l- .41.. l
13:; l. h +
I
12 l l «fr-
l
10 —-1— ar- ‘4—
' '! §
8—i— Jr— +
6)")— J— 4.
J
h 4,. .JL .1.
* 4
2 4*- «1r-
'Ju1ASON DJMAMJun JurASONDJFMAMJun
Percent W 21 E 9
18 1— __ 4-
Hogs Sheep and Lambs
16 «— Jr. V -F
I
12 4- + —+
10 '1- d;- A)
l
l
8 Jr- -+ W;-
6 1!- -1$- 4}-
h J- 4 a}
2 4 if 4-

 

‘ Jul
NOTE:

Figure 12 e

   

 

ASON {JFMAMJun

 

JulASONDJFMAMJun

Graphed in percent of annual total. marketed monthly

Seasonality of Marketings of Cattle, Calves, Hogs, Sheep and Lambs
Through Eleven Sampled Michigan Auctions (Fiscal Year July, 1951 To

June, 1952 )

 

56
was marketed. There were two low months. In June 5.6 percent and in

July 5.? percent of the annual total hog marketings were received at
these eleven auctions. Except for these twa peaks and two early summer
troughs, hog marketings were quite uniform the other eight months of the
year.

The specie which varied the most in marketings was sheep aui
lambs. There was a range from a low of 1.9 percent in June and 2.14
percent in July to peaks of 21.8 percent of the annual total marketed
in October and 18.9 percent marketed in November. wring these latter
two months most of the feeder lambs and native fat lambs were arriving
at the auction markets. There was a moderate rise in sheep and lamb
receipts from July to August. There was a sharp advance to September,
and an abrupt rise to October and November. Very few sheep and lambs
were marketed in the late spring and early summer months.

It was believed that by dividing the state into the three major
livestock areas (Southern half of the Lowar Peninsula, Northern half of
the Lowar Peninsula, and the Upper Peninsula), it would be possible to
notice differences in seasonal distribution of the livestock receipts
at these auction markets due to geographic location.

Of the eleven auctions in the state reporting livestock numbers
for the year 1951-1952, six were located. in the Southern Livestock Area;
four were located in the Northern Livestock Area, and one was located in

the Upper Peninsula. The proportion sampled in each area was fairly close

57

to the total auction population in each of these areas. However, these
eleven auctions were not selected from this standpoint, but were merely
those auctions of the 22 sampled which maintained complete records on
livestock movement through their auctions.

Looking at the graphs for the individual species in the Southern
Livestock Area (Figure 13), it can be observed that October was the peak
month for cattle. At this time 13.1; percent of the annual cattle re-
ceipts were received at these six auction markets. July was the low
month for cattle receipts. At this time only six percent of the annual
cattle receipts were received.

The low month for calf receipts in this Southern Livestock Area
was December when 6.3 percent of the areas total was marketed. This was
a little above the low point for the state's auctions as a whole. March
and April were the high months for calves receipts in this Southern Live-
stock Area. Approximately ten percent of the annual total was marketed
in each of these tw0 spring months.

When the monthly marketings of hogs in the Southern Livestock
Area were compared with the entire state's auctions, it was found that
this Southern Livestock Area had an identical seasonal pattern. This
would be expected, for the largest part of the state's hogs were sold
from this Southern Livestock Area (which includes Ifichigan's Corn Belt).

The seasonality cf marketings of sheep and lambs through auctions
in this Southern Livestock Area was similar to the seasonal movement re-

corded for this specie for the state as a whole. October was the peak

58

 

 

Percent
20 J, 4L
Cattle
18 4_ vr
4%
4L
‘F
J.

J

.LJ

 

 

 

D J F A Jun"

 

Calves

 

 

Percent _
18 ‘” Hogs 1“
l6 ___ T
1? fl... 4)—
11‘-_ l“
R
0-9- J.—
u -r. -p
?4r . it

 

 

‘1 ' 0 ‘ i " ' un

 

 

v— WV o..-‘.-_--_~...

21.2

Sheep and Lambs

+—-~+4——+——-J —-—+-——+——+~+—_+

‘ ‘ ‘ . o ..,.
O I ' 1111

NOTE: Graphed by percent of annual total marketed monthly.

Figure 13. Seasonality of Livestock Movement Through Six Auctions in the South-
ern Livestock Area of Michigan (Fiscal Year July, 1951 To June, 1952)

59
month with approximately 21 percent of the annual total receipts. Nov-
ember, in the Southern Livestock Area, did not have the high secondary
peak as was noted for all eleven auctions in the state. In the Southern
Livestock Area approximately 1h percent of the total sheep and lambs re-
ceived at the area's sampled auctions were received in November. For
the state as a whole, almost 19 percent of the total sheep and lamb re-
ceipts were received at the eleven sampled auctions during November.

Very few sheep and lambs were sold from the Southern Livestock Area dur-
ing the spring or sunmer months. Almost 60 percent of the sheep and
lambs were sold during the four fall months of September through December.

In the Northern Livestock Area there seemed to be more extrem
fluctuations for all four species, than had been previously noted for
the state's eleven livestock auctions, or for the six sampled auctiorm in
the Southern Livestock Area. Figure 114 shows the movement by species
through four sampled auctions in the Northern Livestock Area.

It can be seen in Figure 11; that the peaks in this Northern Live-
stock Area were higher, and the troughs lower than for the Southern Area
or the state as a whole. The rest of the auctions in the state when com-
bined with this area apparently had a leveling effect.

The high month for cattle in this Northern area was in October when
15.5 percent of the annual cattle marketings were made. December was the
low month. At that time only 14.1; percent of the annual cattle marketings
were received at these Northern Livestock Area auctions.

For calves, the spring months of April, May and June were higher

than for all the auctions in the state or for the Southern Livestock Area.

 

Percent
20 _, gr
Cattle
18 .9. .4.
16 4)— .1.—
Jl‘fir 4P

 

        

6+ g,
h 1)- ‘1)—
2_“_ 4r

 

 

JulASONDJFMAMJUn

Calves

 

ASONDJFMAM

 

1n.r T

12 4,. 4L-

 

 

 

NOI‘E: Graphed by percent of annual total marketed monthly.

Figure 11;. Seasonality of Livestock Movement Through Four Livestock Auctions in

Percent I 25 0.0 ' I
18.—4 fiv-
I- Hogs Sheep and Lambs
16 JL - -
i .

 

JulASONDJFMAMJun JulASONDJFMAMJun

the Northern Livestock Ame of Michigan (Fiscal Year July, 1951 To

June, 1952)

 

 

61
This was largely due to the importance of dairying in the Northern Area
and the large number of veal calves being marketed from late winter and
early spring freshenings.

Hog marketings in the Northern Livestock Area had a slightly high-
er spring marketing total when differentiated from the rest of the state's
auctions or from the Southern Livestock Area's auctions.

Sheep and lamb receipts by the auctions in this Northern Livestock
Area were lower in the spring and summer months than had been previously
noted for the state as a whole or for the Southern Livestock Area. The
peak month occurred one month later than for the auctions in the rest of
the state. During this peak month of November, to percent of the annual
marketings of sheep and lambs were sold through these four Northern auc-
tions.

The pattern of seasonal distribution of livestock receipts at the
single sanpled auction in the Upper Peninsula was much different for each
of the species than recorded for the other two of Michigan's livestock
areas, or for the state's auctions as a whole (Figure 15).

Although the records are for only one auction, this auction repre-
sents one half of the auctions in the entire Upper Peninsula Area, and
it was believed that the marketings would give a good indication of sea-
sonality of livestock movement in that area.

Receipts of all livestock were low during the winter months of
December, January and February due to unfavorable winters, which made
marketing difficult.

 

18 .4 .A ' ..
r C ttl r Cal F
e
16 v. a 4)— ves 4»—
13 «p 47 *F
12 +— ’ —-Jp— Jr—

 

 

 

 

 

 

 

 

: r 1"
b + 1“ I Jr
b a 4% -4r
11. 4F J
2 1» 4+ ;_
JulASO DJFMA‘VIJun MASONDJ‘AMMJun
Percent
18 +— __
Hogs Sheep and Lambs ‘1
16.- in
11: h. iL
f
12-1r- 4L
1
mi if
f
8 A» 1-
6A
T
b—u—
2 1-
J

 

 

 

 

JulASON A'un “A a~u '
NOTE: Graphed by percent of annual total marketed monthly.

Figure 15. Seasonality of Livestock Movement Through (he Auction in the Upper
Peninsula of Michigan (Fiscal Year July, 1951 To June, 1952)

 

63

Over fifty percent of the auctioan annual cattle marketings were
made during the fall months of August through November. Calf receipts
at the sampled auction ranged from a December low of three percent of
the annual total to a June high of 16.5 percent of the annual total.
Over hO percent of the calf receipts arrived at this auction in.April,
they and June. Very few hogs were raised or marketed in this deficit
feed area of Michigan. From.these limited arrivals itvwas noted that
November was the peak month with 15.2 percent of the annual receipts.
The recorded.marketings of sheep and lambs showed 35 percent of’the any
nual total was marketed in September. The months of July, August and
September accounted for 56.6 percent of the annual sheep and lamb mar-
ketings through this Upper Peninsula auction.

Percentage Distribution of species of livestock sold at auctions
in the state as a whole and for each of the three major livestock areas
are recorded in Figure 16.

Fbr the state's auctions as a whole it was noted that 25.7 perb
cent of the marketings were cattle; 18.5 percent were calves; h6.8 per-
cent were hogs, and nine percent of marketings were sheep and lambs.

HogS‘were quantitatively the most important specie marketed
through the state's auctions. This was also the most important specie
marketed in the Southern.Livestock Area. In this area hogs accounted
for 51.1 percent of the total livestock marketed through its sampled
auctions; cattle made up 22.7 percent of the marketings; calves made up

17.h percent, and sheep and lambs made up 8.8 percent.

6h

 

Pe went
Upper Peninsula Northern Michigan Livestock
One Auction Area
Four Auctions
60-1» q}— -< L-
504}— .. L— .J ,-

tel.

20.. -

10+

           

    

 

 

 

 

Ca t1. Calves Hogs She and Cattle Calves Hogs Sheep and
Laxigs Lambs

 

Pe cent

Southern Michigan Livestock Area Total Michigan
Six Auctions Eleven Auctions

 

 

 

 

Cattle Calves Hogs Sheep and Cattle Calves Hogs Sheep and

Lambs Lambs
Source: Data from the records of eleven of the twenty-two auc tions in the
State of Michigan, data for the fiscal year July, 1951 through June,

1952.

Figure 16. Percentage Distribution by Species of Livestock Sold in the Three
Major Livestock Areas, and for the Whole State of Michigan

65
Hogs were not as important in the Northern Livestock Area. It

was found that 37.14 percent of the marketings through this area's auctions
were cattle; 30.8 percent were hogs; 21.8 percent were calves, and sheep
and lambs accounted for ten percent.

In the Upper Peninsula, it was found that 146 percent of the live-
stock marketings through auctions were cattle; 32 percent of the market-
ings were calves; 1).; percent were hogs, and sheep and lambs accounted

for eight percent of the total livestock marketed through this auction.

CHAPTER VI
ORGANIZATION, AUCTION FACILITIES, AND PERSONNEL

Twenty-one of the state's general livestock auctions were owned
by partnerships. Eighteen were owned by individuals, and eighteen were
owned by corporations.

The auction facilities were found in most cases to be owned by
the auction operators. It was found that 19 operators of the 22 studied
auctions owned their auction facilities; while the other three operators
rented their auction prOperty.

P sical P_l_._a_n_t_s_ Q3 Eguipment: The facilities used in Michigan
for livestock auctions differed greatly in functional design, size, age,
ease of Operation and layout. A large percentage of the buildings were
constructed specifically for livestock auction purposes. Seventeen of
the 22 auctions in this study were occupying buildings built specifically
for livestock auctions when originally constructed. Five of the 22 saxqal-
ed auctions were not built for this specific purpose. Considering a
building built specifically for auctions in the last ten years as a new
auction building, and one built more than ten years ago specifically for
auctions as an old auction building; it was found that eight of the 22
auctions were in new auction buildings; nine of the 22 were in old auc-
tion buildings; while 1750 of the 22 were in remodeled old buildings; twa

were in old barns little changed, and one was located at a fairgrounds.

67

Some of the auctions had the sale ring, office, lunchroom, and
yards all under one roof. Others had the office and lunchroom separated
from the sale barn or had these located in a leanpto type structure next
to the sale barn. One of these latter-type barns is shown in Figure 17.

_A_ §1_n__all_ Michigan Auction: Figure 17 shows the floor plan of a
modern,‘well-arranged small Michigan auction. 1

This auction used.the same truck dock for unloading and loading-
out the livestock consignments. This slowed.up early loading-out when
there were many late arrivals. ‘While this auction could be criticized
on lack of smoothness of livestock movement because of this, the auction
had many good features.

One of the better features'was the lift separation between bull
pens which allowed the bulls to be driven in one side and driven out the
other to the scales and ring hence not forcing a yardman to back them out
of the pen. This often difficult and dangerous job'was necessary at most
yards.

Another good feature of this auction was the use of some of the
alleys as pens by employing swinging gates which acted as space savers.
They worked especially well with hogs and sheep in the narrow six foot
alleys as in the bottom.of Figure 17. The use of these narrower alleys
made it much easier to steer livestock to the proper pens, and six to
eight foot alleys seemed wide enough for these small auctions.

The scales were located near the sale ring and the livestock was

weighed before selling at all except one of the sampled auctions. The

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69
weighmaster was in a position at this auction to hand stamped weight
slips directly to the clerk, who recorded selling price and buyer's
name on them and relayed the information to the conveniently located
main office. The sales pavilion, where livestock was displayed and
sold, was sealed up separately from the rest of the auction building.

The pavilion seated over two hundred peOple and the seats were raised
in amphitheatre style. This allowed all interested buyers, sellers and
visitors a good view of the sales ring.

The livestock entered the ring from the scales and left from the
right side of the sales ring as depicted in Figure 17. This allowed the
stock to flow smoothly through the sales ring. The pens on the tOp of
this Figure were sellers' pens and were usually enptied from the back
of the building forward. When the livestock was sold it was put into the
larger buyers' pens.

A raised counter was provided at one side of the sale ring. It
was occupied by the auctioneer and clerk. It enabled the auctioneer to
see the livestock, and as he faced all prospective buyers, it allowed him
to follow the bids more easily.

The drive-through trailer dock, with gates at each and, allowed a
car and trailer to be driven in and unloaded quickly without losing the
cargo. A slight dip in the road allowed the wheels of the trailer to
«tap down so that the back of the trailer was low, which made for easier
unloading. Except for the lack of separate loading chutes, this was a
well arranged and easy to Operate small livestock auction. A barn of this

type would have cost around 20,000 dollars in 1953.

93st 93 Auction Facilities: The auctions in the state ranged
from those costing 2,000 dollars up to those reporting an original in-
vestment of 100,000 dollars. The average of 18 of the 22 sampled auc-
tions was 214,971 dollars, which was close to the cost of the auction
depicted in Figure 17. When these same 22 operators were asked what
they valued their auction facilities in 1952, the 21 replying gave an-
swers which ranged from 2,000 to 125,000 dollars. The average 1952
valuation was 3h,02h dollars. This increase in the average by almost
10,000 dollars can be attributed largely to the inflationary rise in
building costs, since mamr of the auctions were constructed before
World War II. '

Table VIII shows the original cost of 18 of the 22 sawled auc-
tions. Table IX shows the estimated replacement valuation in 1952 for
21 of the 22 sampled auctions.

Lunchrooms, Acreg e E22 .P_e_n_ @232: Twenty of the 22 auctions
(91 percent) had lunchrcom concessions. Only two did not provide lunch-
room concessions for their patrons. These were auctions located in towns
where other lunchrooms were in close competition with theirs.

These lunchrooms were not run for supplemental income, but for the
convenience of the auction's buyers and sellers; therefore, they were
often leased out to various civic groups.

The auctions were located on land ranging from one acre to 111;
acres. The average of 19 auctions was 13.5 acres which was available

for use if needed for the business. The actual acreage used was 14.7 acres

TABLE VIII

ESTIMATED COST OF LIVESTOCK AUCTION FACILITIES
AT TWENTYQTWO OF MICHIGAN‘S LIVESTOCK AUCTIONS.
ORIGINAL VALUATION AS DECLARED BY PRESENT
AUCTION OPERATOR

 

 

Number Percent of
of total
value in dollars auctions auctions
Auctions not replying
to question h 18.18
0" 1.4999 2 9010
5,000“ 9,999 l heSh
10,000-1h,999 h 18.18
15,000-19,999 A 18.18
20,000-2h,999 3 13.6h
25,000-29,999 O 0.00
30,000’3h,999 1 Art-Sh
35,000 and over 3 13.6h

 

 

TABLE IX

ESTIMATED REPLACEMENT COST OF THE LIVESTOCK
AUCTIONS SAMPLED IN THE STATE

 

 

 

 

 

 

Number Percent of
of total
Value in dollars auctions auctions
Auctions not replying
to question 1 h.5h
o- h,999 o 0.00
5,000- 9,999 2 9.10
10,000-1h,999 o 0.00
15,000-19,999 3 13.6h
20,000-2h,999 7 31.82
25,000-29,999 2 9.10
30,000-3143999 1 110511»
35,000 and over 6 27.26
Total 22 100.00

 

——-:‘— :-
J -

72
on the average with a range between one acre and ten acres. This includ-
ed space occupied by the buildings, outside parking lots, and outside
yards.

The average auction in.Michigan had 9,927 square feet of pen space,
exclusive of runs and alleys. This was approximately half that needed
to be posted.under the administration of The Packers and Stockyards Act.
The pen space ranged from.one auction.have 3,000 square feet of pen space

to one having 21,708 square feet of pen space (Table X).

TABLE X
TWENTYBTWO GENERAL LIVESTOCK AUCTIONS IN MICHIGAN

CLASSIFIMD BY AMOUNT OF PEN SPACE, EXCLUSIVE OF
RUNS AND ALLEYS

=====================================================

 

 

 

Square feet of ' Auctions Percentage
pen Space studied of total
3,000- h,999 3 13.6h
5,000‘ 6,999 5 22073
7,000- 8,999 3 13.6h
9,000-10,999 S 22073
11,000-12,999 0 0.00
13,000-lh, 999 1 11.521
15,000-16, 999 2 9.10
17,000-18,999 1 h.5h
19,000-20,999 1 11.51;
21,000-22,999 1 h.5h
Total 22 100.00

 

 

Seventy-three percent of the 22 studied auctions had less than

11,000 square feet of pen space.

73
Scales: Weighing facilities were provided at all of the state's

auctions. Each of the sampled auctions had only one scale and weighed
both single animals and lots over the same scale. Of these 22 scales,
20 were registered beam type with a pointer in the indicator attach-
ment which showed when the scale beam was balanced. Two scales were
registered beam type of scales, which enabled the weighmaster to stamp
the weight on a scale ticket as with the other 20, but these txm were
also equipped with a dial which allowed the patrons to see the weight
registered. Reports from 17 of the 22 auctions showed that the age of
the scales ranged from six months to fifteen years. Fifty-taro percent
were five years old or less. Thirty-five percent were over five years
old, but less than ten years of age. Only taro scales of the 17 report-
ing were over ten years old.

These scales were tested infrequently by the Bureau of Marketing
and Enforcement of the Michigan Department of Agriculture, and scale
companies. Nelve of the 22 sanpled auctions reported the frequency
of scale tests. This ranged from an auction reporting the testing of
its scales every two months to several which listed tests once a year.
Forty-two percent listed tests at least once every six months while the
remaining 58 percent listed tests as occurring once every year.

All 22 sampled auctions listed the minimum scale graduation as
five pounds and the minimum weight they could record was five pounds.
The beam capacity of 50 percent of these sales was five tons. Thirty-13m
percent listed the maximum beam capacity as ten tons. While four other

auctions reported other weight limits.

7h
The Bureau of Marketing and Enforcement tested the scales and 11-

censed and examined weighmasters. These scales were required to meet the
national handbook regulations of the United States Bureau of Standards}

The Bureau of Marketing and Enforcement calibrated and tested new
auction facilities' scales. It also tried to conduct at least annual
inspections of already established sales. Whenever it had written re-
quest of a patron, it retested the scales. There was no charge for this
service and any person using the scales could request it. Livestock
scales were required to have a fence on the scales and a stationary fence
surrounding the scales to help prevent rubbing against them and prevent
obtaining inaccurate weights. The scales were required to be accurate
within one and one-half pounds for each one-thousand pounds.

M Facilities: None of the 22 sampled auctions gave the live-
stock feed before the sale; however, some did provide water. Most of
the livestock arrived on the day of the sale, and except for those auc-
tions also running a daily market there were few facilities for special
feeding and watering of livestock at any of the sales.

All of the sampled sales barns were equipped with rows of ele-
vated amphitheatre type seats arranged along three sides of the sales
ring or in front of one side of the sales ring. Seating capacity of

these 22 sampled auctions varied from those seating approximately 95

 

1 Handbook uh, United States Department of Commerce, Bureau of
Standards, l9h9.

7S

patrons to those seating close to four hundred. Sixty-four percent of

these auctions seated less than two hundred and fifty people (Table II).

TABLE XI

TWENTYeTWO MICHIGAN AUCTIONS, CLASSIFIED ACCORDING
TO SALES RING SEATING CAPACITY

 

 

 

 

NUmber of Persons Number of Auctions Percent of Total

50' 99 1 1‘05"
1m '1139 2 9009
150-199 3 13.61;
ZOO-2&9 8 36.36
250-299 h 18.18
350-399 2 9.09
Total 22 100.00

 

r

 

 

Looking at the loading facilities fer these auctions it was found
that in general the same truck chutes were used for loading and unload-
ing. However, at six of the sales special loading chutes were provided
for those wishing to load-out early while other stock was still arriving.
When most of the livestock had arrived, these unloading truck docks were
also employed in loading-out livestock. At 21 of the 22 auctions there
were special unloading ports for trailers. There was an average of ap-
proximately three truck chutes at each of these 22 auctions. The range
was from one chute to seven chutes. Fourteen of the auctions had less
than four truck chutes. Seven had four or five truck chutes and one

had seven chutes. Some of the larger auctions were handicapped by

76

having too few unloading or loading chutes and from not having separate
loading and unloading chutes.

Six of the livestock auctions had access to railroad loading and
unloading facilities. However, little use was being made of these facili-
ties.

The sale ring size varied from one auction with 2&0 square feet
of ring space to one having 600 square feet of space. The average sale
ring area for the 22 auctions was 359 square feet.

92eration‘gf'Facilities: It was found that over 86 percent of the
studied auctions allowed buyers to enter the ring if they so desired.
Only three auctions specifically objected to buyers entering the ring
and had.posted signs to this effect. This latter group'was protecting
other'buyers who want to see clearly. It was also a protection fer the
auction, for in case of injury the auction might be held responsible.
many auctions tried to get around this responsibility by posting signs
that buyers entered the ring‘at their own risk.

The majority of Michigan's livestock auction pens were under cover.-
Michigan's auctions operate the year around and must have some protection
for the livestock during inclement weather. The law was quite explicit
about requiring some such protection. A Michigan Department of Agricul-
ture regulationz states that, ”Livestock yards shall be provided with

 

2 Administrative Code of 121$, (Section 6 of Regulation 119),
Michigan Department of Agriculture, (Mimeographed).

77
pens and buildings necessary to reasonably protect any livestock handled

from injury and inclement weather. The pens and buildings shall be of
such construction as will facilitate cleaning and shall be regularly
cleaned and kept free of mud and accunmlation of manure and filth.fl

Over [:5 percent of Michigan's auctions had over 90 percent of their
auction yardage under cover. Over 86 percent of the auctions had over 60

percent of their yardage under cover (Table XII).

TABLE XII

TWENTY-TWO MICHIGAN AUCTIONS CLASSIFIED BY
THE AMOUNT OF IARDAGE UNDER COVER

 

 

 

 

Percent Auctions Auctions
under cover Number , percent
31- to 1 h.5h
141- 50 1 14.514
51- 60 1 h.5h
61- 70 2 9.10
71- 80 2 9.10
81- 90 5 22.73
91-100 10 16.16
Total 22 100.00

 

 

The auctioneer's voice was audible and distinct at all the suc-
tions visited. All of the 22 sampled auctions had amplifiers for their
auctioneers. This equipment was often ftu'nished by the auctioneers
themselves, but in some cases speakers were set up outside so peeple
in the yards and parking areas could hear what was being sold, and in

these cases the sound was good advertising. For the most part the

78

auction facilities were in good condition. The author visited each of

the 22 sampled auctions and subjectively ranked them on state of repair

of the pens, cleanliness in the pens, lighting in the pens and sale ring,
and sound in the pavilion. All these were considered essential items in
improving the buyers' knowledge of the livestock offered.for sale. Broken,
and poorly constructed.pens lead to possible injury; unclean pens to pos-
sible disease; while poor lighting in the pens and in the ring along with
indistinct or inaudible sound made it difficult to make an.intelligent
bid.

The condition of the pens was good or excellent for about 6h per»
cent of the studied auctions. The degree of cleanliness of the pens, for
the most part, was a little less favorable. Only 50 percent of the auc-
tions‘were in the good and excellent ratings. Only 18 percent of the total
auctions were in the excellent rating.

The lighting in the pens was often inadequate. Some buyers would
like to inapect their livestock early. This lack of adequate lighting
often hampered buyers interested in this early inspection. This was pro-
bably one of the reasons for the many buyers crowding into the auction
sales ring. Sixty-four percent of the auctions ranked.poor or fair in
respect to pen lighting. On the whole the auctions had good or excel-
lent lighting in the ring. Here 82 percent of the auctions were in the
good or excellent category. The same high ranking was true for sound
with 100 percent of the auctions falling into the good or excellent rat-
ing. On the whole Michigan's auctions seemed to be providing good fac-

ilities for the use of the farmers in the state.

79

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80

Personnel: The employees of an auction may be classified as mana-
gers, auctioneers, ringmen, yardmen, weighers, office help, and others
(Table XIV).

The manager usually has a dual role during the sale. He often
does the clerking for the auctioneer besides regular managerial duties.
The auctions were seldom large enough to warrant full-time managers.

The yardmen handled the livestock from the time it was unloaded
at the auction.until it was loaded for shipment as directed by the buyer.
The number of these employed varied from one to 2h depending on the size
of the auction. At the 22 sampled auctions it was found that the yard-
men.made up h8.h percent of all auction employees.

The ringman assisted the auctioneer in obtaining bids from.the
crowd at a few auctions, but his main occupation was moving animals
around the ring and taking them.from.the scale. One to two ringmen
handled all the livestock in the ring at the 22 sampled auctions, help-
ing the one to two auctioneers with the selling.

The‘weighmaster weighs the livestock and fills out a scale ticket.
This ticket listed the owner's name, the livestock's description, and
the weight was stamped on the ticket by the registered beam scale. This
ticket is given to the clerk at ringside.

The clerk sat with the auctioneer and recorded the selling price
and buyer on the scale ticket he received from the weighmaster. The

clerk then turned this completed scale ticket into the main office.

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82
The office help kept various accounts up to date for the buyers
and sellers during the sale, and handled bookkeeping records after the
sale. The amount of office help varied from.one to nine persons, de-
pending once again on the size of business.
The total personnel employed at auctions is shown in.Table IV.
This was categorized by small, medium.and 'large' business, as used in

previous chapters.

TABLE XV

TWENTY-TWO MICHIGAN AUCTIONS CLASSIFIED BY SIZE OF
BUSINESS AND NUMBER OF EMPLOIEES FOR EACH SIZE

 

 

 

 

Number of Employees
Size of 5-9 lo-u 15119 20-2h 25-29 30-31; 35-39

 

 

 

 

business Number of Auctions Total
Small 2 3 2 - - - - 7
Medium. - 3 3 - 1 - - 7
'Large' - - - 3 - 3 2 8
Total 2 6 5 3 1 3 2 22

 

 

The number employed at small auctions varied from seven to 17 amp
ployees. At the medium sized auctions the variation was from 13 to 27
employees. At 'large' auctions the range was from 20 to 36 employees.

The average number of employees in these 22 auctions was 19. The
average for small auctions was eleven employees, for medium seventeen

employees, and for 'large' auctions twenty-eight employees.

83
The employees for these one day a week sales came largely from

local farmers. All auctions listed this as their major male labor sup-
ply3'with minor additions from.school boys, local factory workers, and
traveling auction help. The office help was largely composed of local

housewives.

.CHAPTHVII

emu mm mocamms, Iccomlmn mums
um sumac cmmss u momma AUCTION manta

My}; §£_1_q: The suction nthod of sale was conducted one
day a week at each of the suction markets ssquod. ”Bottom, 23 percent
of these sections bought livestock as order buyers especially for hogs,
during the other due of the week.

2;. 95 §g_l_g: The starting tin for the typical mchigsn motion
ranged from twelve noon to 8:00 an.

The eagle included 15 auctions with afternoon sales, and seven
with evening sales. The operators of the smaller evening sales. stated
that, because theirs were small-scale enterprises, better bwer partici-
pation was obtained with evening sales. Sons buyers fra other sales
apparently visited these evening sales to finish out their day's buying.
Evming sales also provided a better opportunity for sellers to attend.
This was especially true of part-time tenors, who were unable to get
wayfrouwork during the dayto attend. Evening sales also provideda
better Opportunlty for the motions to obtain part-tine help for this
once-a-week operation.

The average starting time for the fifteen afternoon sales was
two Pm. The afternoon starting time ranged from twelve noon to three
P.H. The average startizg tine for the five evening sales was seven
PM. The starting tine for "stung sales ranged from four PJ. to
eight PJI.

85
‘ it the auctions the length of sale ranged from two to nine hours
during the sunsr; the average being four and one-half hours. The length
of sale was considerably longer during the busier fall season. brough-
out the year, the sales lasted until all the livestock was sold.

Sellers: The average mnber of sellers per sale in the eagle
ranged from 30 to 600. The average amber of sellers for the sample was
205.

The auction's livestock was either sent direct]: to the auction by
farners, or by dealers or auction btvers scum as dealers.

The livestock shipped to the auction by farnars was delivered in
their owntrucks orbroughtin for the farners byhired truckers. Sane
auction operators also ran their own trucking service; while others aet-
ed as a central dispatching service for commit: truckers.

It was found that 80 percent of the feeder cattle, 93 percent of
the slaughter cattle, 98 percent of the vealers, 98 percent of the sheep
and lube, 96 percent of the feeder pigs, and 99 percent of the betcher
hogs cane fro: farners. It was found that 20 percent of the feeder cat-
tle, seven percent of the slaughter cattle, two percent of the vealers,
two percent of the sheep and lanbs, four percent of the feeder pigs, and
one percent of the butcher hogs were supplied by dealers.

Buyers: Considerably fewer buyers than sellers were in attendance
at the auctions. it the auctions in the salple the average nunher of
bluers per sale ranged fron five to 100 depending on the size of the sale.
The average nunber of buyers in attenthnce was 3h.

86
The naJor buyers at auctions were packers and farners. The largest

percent of the slaughter livestock was taken by packers through their own
direct representatives or through order layers. Approxinately 100 per-
cent of the slaughter cattle, vealers, slaughter sheep and lambs, and
butcher hogs were taken Iv packers. Seventy-three pccent of the feeder
cattle were purchased by far-ere at these nation. Twenty-ho percent
were purchased by dealers, and five percent by packers. Three pacent of
the feeder pigs were purchased by dealers, while 97 percent wce pea-chased

by far-ers. (my 52 percent of the sapled auctions handled feeder lalbs.
These reported selling nine percent of then to packers, six percent of
then to dealers, and 85 percent to farmers.

mam: In Hichigan all the slaughter livestock was
sold by weight. The only types of livestock sold by the head were dea-
con calves, a few dairy replacements and feeder pigs. However, 59 per-
cent of the auctions reported that they sold feeder cattle by the head
when requested to do why consignors.

9:325 9_f_ E3: The comlete order of sale varied between sales.
For sons species however, the auctions were quite comistent in the order
of sale. This was especially true in the case of feed:- pigs which were
generally sold outside before the sale was started in the rim.

The order of sale in the rim followed senahat this general order:
deacon calves, veal, feeder cattle, weep and lanbs, slaughter cattle,
bulls, andhogs. Thebau-ows andgiltswereusuallysoldbefore the

rough hogs.

87
it three of the sales the hogs were sold first. The lungs-eat
explained that it node nore efficient use of pens, for when hept separa-
tedbyconsignors mnerepens were required thanwhen confinedin
hwers' pens. Early sales of these hogs therefore released seller pens
for late arriving livestock.

Auctions selling hogs last clained that, due to the dist created
tw hogs, nary of the more liloed towait until the end of the sale for
these. Secondly, deacons and feeders were largely purchased by famrs.
selling these first gave the far-ere an opportunity to get their purchas-
es hone early. Butcher hogs were purchased by a fa packer bwers who
were under less pressure to leave.

In general, the auctions had developed a sale order which see-ed
to be best suited to the desires of their buyers.

m _an__d_ gm: The livestock consigned at Richigan's ano-
tions was sorted for nsrket class at all the auctions studied and each
such narlnet class was sold under individual consignor's ownership. The
livestock was sold singly or in lots, but always under individual anor-
ship.

l‘oet slaughter heifers and steers, lost rough hogs, all. slnghter
cattle, all calves, all dairy replace-tents and all bulls were sold singly.

Feeder pigs were not sorted but sold as per arrival. They wee
usually sold in lots as groomed by the consignor prior to delivery at the
auction. However these lots were sometime broken up by the auctioneer
with the consignor's pernission.

88
lo strict grading was atteqted at the auctions; haever, sons
lots within individual narket class consign-ante were divided on the
basis of weight or acne other physical characteristic. For ennple,
feeder cattle were divided up into lots largely based on weight, age
and confer-ation. These lots or individual annals were sold as the
divided. lo two consigmnts were lined.

Barrow and gilts were separated into weight classes if tbre
was mch difference witMn an individual's consigmnt. boy were as-
wally sorted by the consignor haever, before arrival.

Sheep andlanbswereusuallysoldinlots. These lotsweregroup-
ed son-that uniforaly by age and weight, but no two consigments were
nixed.

2132 Protection: it all Hichigan auctions sons Torn of price
protection was allotted the seller. here were several nethods of price
protection in use. For angle, at sixty-thee percent or the auctions
inthe samlethe sellerwas allowedtobidashedesiredenhisown
livestock; at twenty-seven percent of the auctions the seller was lilited
to one bid; at five percent of the auction the seller was allowed to list
the winin- price he would tahe; and at five percent the seller could list
the Ital-In price or bid as desired.

When far-ere or dealers bid on their on livestock there was no
charge node. or any restrictions levied at 36 percent of the actions
canned. it 23 percent of the auctions there was no charge nade unless
the sellernade ahahit ofusingthispracflce as aneans ofinventorying

89
his livestock. Eighteen percent of the auctions charged one-half of the
regular coulssion when the livestock was bid in, while eigxteen percent
charged regular codssicn. Five percent of the auctions charged one
dollar if the seller bid in his cattle. in bidding-in which occurred
was largely on cattle and calves, for hogs could not be legally taken
back to the fanwhen sold through the ring.1

Further price protection cane fro. the auction mageaent buyin
on its own account to "protect the price". It was found that 73 percent
of the auctions in the sanple did my regularly to protect the price.
Another rune percent bought for this purpose occasionally, while 18 per-
cent did no price-protection bidding.

m 2; W. Inforaationa The sanpled auctions listed nrket
reports from the Detroit and Chicago stockyards as their naior source of
mrket infer-ation. This was dissednated to the auctions nest effective-
ly by radio (Table m).

Advertigigg Auction: The 22 auctions spent fro- aero to 55 del-
lars a week on paid advertising.

The average anount spent was 15.86 dollars per week. Olly four
of the 22 auctions spent 30 dollars or nore a week for advertising. There
were new nthcds used to solicit business at these studied auctions. So.
of thenainnethodsused arepresentedinTable I711. -

 

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hummeutudml 6. 9
Daily newspaper 5.5 3
0.8.13.1. Daily Market am Report h.5 7
Drover's Journal 5.5 7
Total ‘ 66. 100.

 

 

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91

W 2.“; 59% Procedure: Office prooeMe and ferns used
by the auctions varied greatly. However, an attenpt to generalize the
procedure is given below.

Upon arrival, the livestock was identified. cattle and calves were
ear-tagged at 20 of the auctions in the eagle. a nunerioal patch was
used for identification at the renainiu he auctions. Bogs and sheep
were painted or chalked for idmtification at 77 percent of the studied
auctions. it the renaining 23 percent these species were placed in in-
dividual ccnsigrnent pens and identified by nunbered pom. livestock in
large consignnents were not individually narked when they oceuppied an
entire pen. In odd-lot consignnents, the livestock was all identified
so that several consignnents could be collected in the sane pen.

' £035 Receipts: it the tine of identifyiu, a dock receipt or ship-
ping tioket was nade out for the trucker. This was nede out in triplicate.
It showed the miner's sane and address; the trucker's none and address;
the klnd of livestock; the unber of head. of each kind; am the identifi-
cation. Oee copy of this clock receipt went to the nain office for entry
in the seller's voucher. we went to the shipper as a receipt for de-
livery of the livestock. The other follaled the livestock to the pen for
later use in filling out the scale ticket. The pen mmber was often re-
corded on this deck receipt. i dock receipt was nade out separately for
each narket class of livestock so it could accomany livestock to the
correct pens.

92

goal; We Before sailing, the livestock was noved from sel-
ler's pens to the scales. are dock receipt was handed to the weigh-
naster who referred to em. to record on the scale ticket the ‘consignor's
none and address; the kind of livestock, the livestock's identification
amber, and the umber of head being weighed. he scale ticket was nade
out in duplicate. This scale ticket was handed to the clerk at the suc-
tion ring side. The clerk, who sat with the auctioneer, filled in the
scale ticket with the selling price, the War, and the bwer's pen nu-
ber. Then the clerk sent one copy of the scale ticket to.the nain office.
The other part of the scale ticket usually want with the livestock to the
buyer's pen as a Wer's receipt.

Er's Invoice: it the nain office a running account of the ba-
cr's purchases was kept on a m invoice. This invoice listed the
taver's nane, address, pen, kind and nunber of livestock, weight and price.
It was nade out in triplicate. The original was kept at the office; the
second copy went to the buyer as his bill; the third copy was somtinu
used for checkin out livestock frm the yards.

Seller's Voucher: it the sane tine that the nitry was node on the
Wer's invoice a sinilar entry was nade for the consignor on a seller's
voucher. This showed consignor, livestock's identification, buyer, type
of livestock, weight and price. The total value per lot, and the total
gross snount was listed. The various selling charges (Co-issien ad
insurance or service fee) were listed. These selling expenses included
a trucking mouse when a hired truck was used. when these expenses were
subtracted fron gross receipts, a net proceeds figure was obtained.

93

Part of this seller's voucher was often nade out fron the ship-
per's ticket or dock receipt before the scale ticket cans in. This sane
dock receipt inforned the office help when an individual consignor's lots
had been sold. The office could then have a comignor's check ready for
hin quickly. After a consignor's livestock was sold, a check was nde
out to the seller for the anount recorded on the seller's voucher as net
proceeds. In sons cases a conbination check and sale bill was used, while
in others separate sale bills and checks were used. One copy of the eel-
ler's voucher went to the seller, while one was retained at the office.

£22. M: Sons check on sales was allowed if the clerk who
recordedat theringkeptagalggM. Thiswasfilledoutatthesane
tins as the weight slip. It listed nunber of head, kind of livestock,
owner, bwer, price and weight. It was very useful in case of a lost
weight slip-

m m: Sons motions kept only weight slips, taver's vou-
chers, and seller's vouchers as pernanent records. Others kept very cen-
plste records of information obtained frcn the above nentioned smpcsedly
prinary records. These auctions which kept couplets records had 203k-
2933 £23 which mowed buyers, sellers, their addresses, umber of
head in transaction, weight, price, gross selling price, anount of con-
nission charged, aunt of service fees collected, and deduction for
trucking. These were arramed in individual colunus which could be sun-
nariaed for the weekly sale giving total nunber of head w species, gross
sales, paynents to far-ere, receipts from connissions and service fees,

9h

paynente fron more, gross insane to the auction, arr! itedsed opera-
tional expenses which were subtracted fron gross incone to give an anc-
tion' s net operational profit. Such a couplets bookkeeping sheet was
kept at very few auctions.

A final fern onloyed at nany sales was the release 9219.? This
order showed to when the livestock was released, nunber of head, pen nun-
ber, and who checked out the livestock. his released the comany fron
liabiliw after the trucker had hauled the stock fron the yard, for the
purchaser or trucker signed these releases when the livestock was loaded-
out.

The keeping of these or sinilar record! was a necessary part of an
auction's operation. This was true not only fron the stantkoint of good
nanagemnt, which required kneelsdge of business operations , bnt also as
legallyrequiredunderPublic Act 281;; anactwhioh requiredthat 'ade-
quate records“ be kept of all sales and purchases of livestock for two
years fir-on date of sale. These records were to be opened for impaction
at the request of the nopmnonr of Agriculture.2

m 9.253!!! The selling charges at marigan auction varied
greatly betteen auctions. Often within the cane sale there was a varia-
tion in selling charges to individual consignors due to differences in
nunberofheadcensignedorvalus ofthe nmtookoozmd (App-mac).

2 Less Relat to and Administered the artnent of culture
anon... mar-1% mar-W rot ragga-257133 , . org-57“.. _

pp. 86s

95

Seventeen auctions reported their selling charges for cattle. It
was feund that '41 percent of these auctions charged by the head with no
variation for differences in m:- of cattle supplied 1w consignor, or
for differences in their sale value. Selling charges for this group of
auctions ranged from one dollar to one and one-half dollars per head.
Nasty-four percent of these auctions varied selling charges accordin
to sale value 3 eighteen percent varied charges with changes in volune
of cattle arheted by individual oonsignors; and, eighteen percent charg-
ed a fixed percent of gross selling value.

At 82 percent of these auctions a service or imarance charge
was addedas anextraco-nission. i'hechargelsviedramedfronone-half
to one and one-half percent of the gross selling price.

In general selling omissions and service or insurance fees were
the only charges levied at livestock motions.

Seventeen auctions reported calf charges. It was found that 70
percent of these an tions charged by the head with no variation. ihe
charges ranged frcn SO to 80 cents per head. To this was added a service
or insurance charge of one-half to one and one-half percent of gross sel-
ling price. Eighteen percent of these auctions varied their selling charges
with the value of calves supplied; while 12 percent varied their calf eel.-
ling charges with the nunber of head supplied.

Seventeen auctions reported hog selling charges. It was found that
76 percent of these sales charged by the head with no variations for vole-e
or value differences. The charges ranged in this group fron 20 to 80 cents

96
per head. Twenty-four percent of these actions reported varying sellim
charges as thenunberofhogs consignedhyoneownerchanged.

Feeder pig selling charges were obtained from 15 diffth anc-
tions. All auctions sold feeder pigs by the head with no variations for
volune or value differences. the range in price was fron 25 to 35 cents
per head. i'he auctions usually eliminated the insurance or service charge
on sales of feeder pigs.

Sheep and lamb charges were reported by 12 muons. m1: eight
percent of these varied selling charges for couignors on the basis of
nuflaer of head consigned. linety-two percent charged a straidlt emis-
sion charge per head. he sellim chuge ranged from 25 to 60 cents per
head plus a half to one and one-half percent service or insurance charge.

fable XVIII shows the selling charges for four njor species of
livestock at the nest cc-cn motion rate and lists conparisons with con-
parable sellin charges at the Detroit 'rerdnal Harbt.

this comparison shots that in general there was very little dif-
ference beheen the charges at the auction and the terainal nrket.
Charges for odd-lots were a little higher at the tar-incl, hut as the
volu- of livestock shipped to the terdual increased, the charges at the
two markets becam quite close.

fable XVIII does not take into accomt the differences in trans-
portation costs batman the two narkets. me of the largest diffcences
between coats of using the two outlets would be the increased distances
fron nest fans to the tor-ire]. narket. There were 57 livestock stations

 

 

 

 

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98
widely scattered over the state and therefore, there was one within a

shorter distance to nest ferns than the terainal earkets at either Chic-
ago or Detroit.

Actually to draw an intelligent value Judgment in selectirg a place
to sell, a farmer should have access to the following intonation:

l. The fareer should know the selling price at the two narbets
which were being comared. This would vary little between auction sales
and the tar-inal market. The rain differential would be transportation.
Prices for couparison of the two markets were difficult to obtain. The
terminal narket, with its narket we service gave a fairly couplets ac-
count or prices by various grades and weight classes. Such mbiased, re-
liable reports were not available at the auction Iarkets. The only reports
tron auctions were issued by the operators themselves and these operators
usually confined theuelves to reportirg the tsp of the eel-Inst. Such re-
ports do not tell the couplets story.

It was considered doubtful if adequate arket reports could be obtain-
at the auction level. The actions were widely scattered with heterogeneous
receipts due to geographic location; they usually handled a relatively low
volue of am one narket class, and the livestock was not graded. It was
believed that the cost of maintaining market reporters at even a In re-
presentative sales would be out of proportion to the value of such a ser-
vice to farnere or other section Operators. 1 visit to the local sale
after haviu heard the tea-atlas]. Isrket quotations would probably give the
best indication of trend in prices between the two markets.

99
2. The farmrs should also know the weight of his livestock. This

weight and selling price would give the value of gross receipts, and should
be muted for both Iarkets.

‘ 3. The farmer should then investigate differences in narlaetirg costs
at the two narkets. The first such selling cost was the selling charge. 1
list of comisaion charges at the terminal narket could be obtained fro:
the conisdon agency which operated on that sarhet; the charges for yard-
age, feed and other services on the temnal narket could be obtained from
the stochyard company which owned the yard (on a terminal narket the facil-
ities and selling agencies were separate functions). A list of amtion
selling charges would have to come directly fro- the owne- of the auction
in which the faresr was interested.

h. The other udor selling cost was transportation. his could be
calculated on the basis of cost of operating the famr's own vehicle or
it could be obtained by calling local truckers. When estinatiu this cost
the shrinkage should be considered as an integral part of such cost.

Once this information on estinated selling costs and «tinted gross
receipts was carpeted it was then possible for the far-er to mice a fair-
ly objective choice betwun the he narkets on the basis of the net re-
venue. This difference or net revenue should be used as the criterion to

answer the age old question of where to sell.

CHAPTER VIII
SUMMARY AND CONCLUSIQB

m: The first livestock auction started in the United States
in 1836. The first livestock auction was established in Michigan in 1933.
By 1937 there were thirteen livestock auctions in Michigan. The number
grow until in June 1952 there were sixty-four licensed livestock auctions
in Michigan. The desire of the farmer to sell near at hose and watch his
livestock being sold was a big factor in the expansion of the decentrali-
zed livestock auction.

The major portion of this study dealt with general livestock auc-
tions. These were sales which handled all species of livestock and which
obtained their major source of income from the handling of livestock.
There were fifty-seven of these licensed in mchigan in 1952.

Twenty-bro of these general livestock auctions were selected as
a stratified purposive sawple based on geographic location, size of busi-
ness and type of ownership. These sampled auctions were visited during
July and August, 1952. The najor context of this thesis was derived from
these interviews.

It was found that the Southern Livestock Area had the largest ab-
solute nunber of auctions and the largest sised auctions. The auctions
were the nest numerous in proportion to livestock numbers in the lorthern
Livestock Area.

101

Here 31.5 percent of the state's livestock auctions were located
in an area which contained only twenty-one percent of the state's live-
stock.

It was found that a linited number of auctions in the Upper Pen-
insula were providing a mob needed outlet for this area of limited nar-
ket outlets and scattered livestock population. There seened to be a
lack of competition betIeen contiguous sales and it was concluded that
this was largely due to multiple auction ownership by contiguous owner-
ship entities. Feeder cattle were found to come the greatest distance
to the auctions, while feeder pigs and sheep and lambs cane fron within
a closer radius.

Considerable seasonal variation existed in receipts of livestock
at the livestock auction markets of Itichigan. The nonthly seasonal pat-
tern for all livestock showed that the peak nonth was October. At this
tine approximately thirteen percent of the yearly livestock receipts was
marketed. For the state's auctions as a whole it was found that the
largest number of cattle was mrketed in September and October. July and
December were the lowest cattle months. April was the largest calf nonth,
while hog receipts were largest in October, and sheep and lube were larg-
est in October and November. This pattern varied somewhat when the state
was divided into three major livestock areas.

It was found that eighty-six percent of the auction operators own-
ed their auction buildings while the other fourteen percut rented than.
Although the auction facilities used in Michigan varied greatly in

102
functional design, sise, age, ease of operation and layout, it was found
that seventy-seven percent of these auctions were occupying buildings
built specifically for livestock auctions. The average cost of these fac-
ilities was reported to be 214,971 dollars. linety-one percent of the
auctions provided lunchroon concessions. Furthermore, it was found that
the average auction in Michigan had 9,927 square feet of pen space.
Weighing facilities were provided at all of the state's auctions. The
naJority of mchigan's livestock pens were under cover. It was found
that forty-five percent of Michigan's livestock auction had over ninety
percent of their auction pen space under cover. The average umber of
employees in these samled auctions was nineteen.

The auction method of sale was conducted on day a week at each
of the auction markets salpled. However, at twenty-three parent of
these auctions livestock, especially hogs, was pm-chased on orders dur-
ing the other days of the week. The sawple included fifteen auctions
with afternoon sales, and seven with evening sales. Although the sapl-
ed auctions averaged 205 sellers per sale, there were on the average only
thirty-four bwers in attendance, and cone sales reported as few as five
buyers. it all Inchigan auctions sons fern of price protection was al-
lowed the seller. Radio narket reports were found to be the najor wu
that auction operators received price information. Selling charges
varied greatly between sales. In general, the auctions charged a straight
per-head comdssion charge regardless of the umber of head consigned or
the value of the consignment. There was in addition an insurance or ser-

vice charge of one half to one and one-half percent at nest of the auctions.

103
Conclusions: Three of the major operating problem cited by auc-
tion operators were:
1. The difficulty of obtaining good part-tine help.
2. The need for having a veterinarian in attendance to spot sick
aninals and test cattle so they night he returned to the fern.
3. n1. difficulty of getting farmers to brim their stock in on

A fourth and the nest inportant problem was their stated need for
a credit bureau to check on the financial status of bwers or the estab-
lishnent ofabwer'sbondiuluto requlrethebondizg ofccnnercial
Were on auction narkets.

Hhen new laws are being considered, the author believes first con—
sideration should be given to establishment of a buyer' a bonding law for
the protection of the auction operators - the ninimu bond should be at
least equal to the average weekly purchases of the buyer. While at the
sane tine consideration should be given to the raising of the auctions'
bond require-ants to an anount at least equal to the average weekly sale.
This would give nore realistic protection to seller and sellim agency
than the regulation nu in effect.

The author noted the inadequacy of the loading and unloading facil-
ities at new of the sales. The shortage of buyers at ease of the stall
auctions, where there was often only one buyer per species established
an unsound, uncemetitive narket for the farners. The evenim sales in
new cases should be elininated or started earlier for when these sales

10h
extended late into the night they lisited the number of buyers which re-
nained to bid on the last of the livestock. The author believes that as
imortant as the establishment of new livestock auction laws is the need
for acre strict - enforcement of 1m which are alrean established. Per-
haps a provision in the law for cancelling the licenses of license holders
who do not live up to the law would quickly close up irresponsible ano-
tion operators.

liarket prices should not be subject to manipulation by mane con-
nected with the auction, and all dealings should be fair and free from
discrinination with respect to the livestock offered for sale. Selling
charges should be published and should apply uniformly to all types of
sellers. These selling charges should be reported to and subject to ap-
proval of the mchigan Department of Agriculture. To help insure paynents
to patrons; auctions should keep accounts for payments to these patrons
separated from accounts for the eXpemes of the auction's operations and
fro. the operator's own personal account.

The auctioneer should announce the name of the actual consignor
when a lot is brought into the ring and the nane of the Wer when the
lot is sold. The law now requires that adequate records be kept. The
author feels that weekly reports on livestock numbers and gross sales
should be sent to the Michigan Deparhuent of Agriculture for use in es-
tablishing a bonding base and in evaluating trends in the industry.

These auctions were particularly valuable as a narket outlet for
the snall producer, who could neither take advantage of sellim in value

105
at the terminal narkets, nor narket directly to packers. A few years
ago the snall producer was almost at the mercy of the country dealer; the
only buying competition was between dealers. These dealers could usually
out guess the farmer on weight and had a better insight into current
prices; hence, the farmer was provided with an unsure, unsound, and often
unconstitive narket. The auction's establishIent has remedied sons of
that difficulty giving not only a nore conpetitive outlet, but a place
where the farner can keg» abreast of price trends.

The auctions have become alnost a tradition in the state, and on
the sale day are a social gathering place in the continuity. with the in-
provenent of these sales as a nrketim outlet at a high level of owner
integrity, they will becone even nore fir-1y established as a livestock
narketitg outlet in Michigan.

106
BIEIOERAPHI

Anew-cue, List 31; Stooge-ids Posted Under 31; Packers and Stoc
c on and Wstrafion,mted Sta 8

Act, 192
DeparEth of Agriculture, October 5, 1952.

idlinistration Code of 1% (Section 6 of Regulation 119),
We: gan Department of Agrififlture, (mmographed) .

2 Handbook 9.1!) United States Departnent of Comoros, Bureau of
S , 0

List of Livestock Auctions in the United States 3; States
lfid) : Comma Fates an'd-ii'eEstration' s Section, Packers
and Stwlqarcb Division, United States Dapartnent of Agriculture, 1952.

ations Michigan Corporations and Securities

Files 33 C

Mam , an.
ations Under the Packers and Stoc ds Act as
md%s imam», n3 fifiugfi Eu-

m 110. 1&3, February, 19,45, PP. 20.

m an Aggcultural Statistics 1 (Elohigan Department
of Agric ture Cooperating with the 34.3. o the United States De-
partnent of Agriculture, 1952).

Intonation from office mchigan Co-operative er: Reportdn
33H“, Lansing, Hichigan, data in process of publication for 1952,
'Ifichigan Agricultural Statistics ".

U. 6. Census gfégréculture, 122, 0.8. Btu-eau cf Census,
as n, D.C. I

List of Licensed Dealers and Truckers S tenber l
.m-rggz “Ban-e au um mWefiét £2”
cfi't'ure, responsible for dealer licensing.

Illinois Livestock Thro Auctions (The Depart-ant

of $1 t Emacs, Even o s, nineographed 890,
June 1938), We 2e

Lure Relat to and Adlinistered y; the De artant of 5%-
culfiie B: an warmest-57m, 195$ pp. 7:77: co .
5533, l72.

107

Bjorka, K. and 3. Thomson, Comm. Livestock Auctions in Iowa (Iowa
Exporilent Station Bulls 3 , 9335, pp. 230.

Clemen, R. A. , The Amrican Livestock and Heat m (New York Ro-
land m88,-m3), pp. §’ GOBEe 7W7.

Eckert, P. and G. F. Banning, The Livestock Auction in (hie, (Chic 3:-
perinent Station Bulletin 557, I93; 5 , pp. .

Filley, H. C., Livestock Auctions in Nebraska (Nebraska Agricultural
hperimnt Station W339, , pp. 3.

Hill E. B. s-of- Areas in mchi an mchigan Agricultual
fhpe , Station etin R Me, 1939), pp. 68.

Holland, H. and A. R. Clark, Livestock Auction Harkets in Hontana (lion-
tana State College, Mama on efin 1:31, , pp. h.

Jennings, R. D., Aninal Units of livestock _r_e_<_i_ The United
States Dapartne'EE of Agriculture, fist: of Ag c tural Bcononics,
Fen. al (19,49), We 15e

Johnson, K. C., Kentuc Livestock Sales anisations (Kentucky Agri-
cultural Eiqae 11 Station Bum , 2 pp. 213, cont. 217.

Johnson, a. L., Relative ortance 9; Alternative Market Outlets a...

ltichi an Farmers _i_n_ Sel Mum Eter's Essie,
gmrrco 1.9, 2, W

Kraur, 3., Unpublished emery from Office of Price Stabilisation records
for the year 1950 , (Department of Agricultural Economics, Michigan
State College) (nap).

Plunb, Charles 8., Market}. of Fern Animals, (Boston: Gin and Conpaw,
1927), pp. 259,—Tcon .", i2:;6‘6)‘: ' "

Randall, G. 6., and L. B. Mann, Livestock Auction Sales _i_n_ the United
States Fern Credit Administration, MBE, (m, 19.3.95, pp. 2,

OOnEe 111‘s

Stark, D. , livestock Marketi Extension Re t (Depart-ant of
Agrigultura Beonozdcs, fi igan Wage, 9 8) (Hineographed) ,
me , conte 10.130

Tees, 1., Harke% Ifich an Livestock (Umublished haster's Thesis for
Departnen o 37.3%}? gen State College, 191:0), pp. 70, cont.
75.

APPENDIX A

MAIL QUESTIONNAIRE

109

IICHIGAN STATE COLLEGE
DEPARTMENT OF AGRICULTURAL EONOIICS
LIVESTmK WING PROJECT

 

WK AUCTIONS Stan Parry
Graduate Assistant
commrrm. Ag. Econ, II.S.G.
1. lane of your. auction .

 

Address of your auction .

2.!aneofyournsnager .
Addressofyournanager .

3. Ownership of your auction...p1ease check one(J).

 

Individual .
Partnership“. ,
Corporation ifyoucheckthisonepleaseindicatemnberofetock-
holders e
Cooperative if you am this one please indicate lumber of non--
hers e
h. lhen was your auction first started_ _‘R
5. Ihetdeyordayeofthe weekisyouranction held? _.

 

Doyoualsoprovideadailynarketfor farser's limyes_no .-

6.lhstwereyom'averagewee OrcssreceiptsfronsflesinmuSSZ)
. ‘ livestock? .
from other goods or are .
7. lhat is the average under of sellers in attendance at your auction? .
8.Uhet iathe eves-agenuwer efpggginattendance at your auction? .

9. Personal enployed in operating your aucflon...plsaee supply tubers.

 

v—

Auctioneer

_A

Ringnen f
Iardmn

leighters W
Others _

10. Didyourauction lose awsoneyfroabadchecks ornonpaynent of bills durim
1951? Tea he .
mimnldyoubewillingtocooperatewithus inanereconplste analysiecfthe
livestock motions in the state of Iiohiganf
Ill ”0 e

w“

 

 

fivw

—-e-.e“!~

.«ae».

APPENDIX B
QUESTIONNAIRE USED IN PERSONAL mmvmis

DEPARTMENT OF AGRICULTURAL ECONOMICS
MARKETIM} PROJEO'I‘o-LIVFBTOCK AUCTIONS
NICHI GAN STATE COLLME

NAME OF AUCTION -
Anmuss

 

CODE NUMBER
Record this number on each page of the schedule and
file separately until all are collected - then des-
troy this.

THE ENCLOSED INFORMATION IS STRICTHfiCQNFIDENTIAL

1.

2.
3.
h.

S.
6.

-l- CODENUMBER

How is your auction owned? Please check one.
a. individually
b. pa‘ tnership

 

 

 

 

c. corporation d. if checked here indicate number of
stockholders
a. cooperative f. if checked here Edict-ts number of
‘ members

 

When was your auction first started?

 

What day or days of the week is your auction held?

 

Do you also provide a daily market for farmer's livestock?

a. yes
b. no

 

What is the average number of sellers in attendance at your auction?
What is the average number of bgers in attendance at your auction?

Please list number of personnel employed in the various categories as follows:
a. (1) Manager
(2) How long?“ this manager been a manager with livestock
auctions ms.

b. Auctioneer
c. Ringmen
d. Yardmen
e. Weighters
8e Others

 

 

 

 

 

 

Note: Answers to the above questions only required in cases where mail

questionnaire was not rcturned...if previously answered remove this _
sheet before conducting study.

- 2 - CODE NUMBER

GENERAL INFOI-MATION
A.M.
8. Average time of opening sale? PJI.

9. Average length of time for sale
a. sumer hrs.
be Winter hI'Se

10. What media of advertising do you use?
a. newspaper
be radio
c. handbiIIs
d. letters, postcards
e. posters
f.

 

 

 

 

 

11. How much do you spend on weekly advertisements? S

12. Complete the following'blanks indicating order of sale by species - whether
these species are sold in lots or individually, whether these are sorted,
and whether these species are sold generally by weight or by head.

_.._‘

 

 

 

 

 

ORDER OF ' GENERALLY SOLD
SALE SORTED IN LOTS INDIVIDUALLY BY WEIGHT BY HEAL
g 1 2 3 z. m 5 6
a. Feeder heifers and { '
steers
b. Slaughter heifers {.
and steers

 

c. Slaughter cows

d. Calves (vealers)
e. Bulls

f. Dairy replacements
g. Sheep and lambs

h. Feeder lambs

i. Feeder pigs

.1. Barrows and gilts
k. Sows

1. Boers and stage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

13. Why do you sell in the order listed under 12?

 

11;. How is the livestock identified upon arrival at the sale?
a. Ear tag
b. Chalk
Ce Patch
(1. Paint
3e

 

 

 

 

 

-3 - cons NUMBER

15. How can the seller’protect himself on price?
a. Reject bid
b. List minimum price he will take '
c. Make one bid
d. Allowed to bye bid
e. Other (explain)

 

 

 

l6. ‘Nhat do you charge consignors who take home their own livestock as a result
of price protecting operations as under 15?

17. Does the management‘buy on its own account to protect the price?
a. Yes
b. No

 

18. Is livestock insurance carried on the livestock while at your auction?
8. YES
be NO

 

19. If the answer to 18 is yes...what does this livestock insurance cover?

20. Is a record.kept of where animals are yarded?
as Yes
b. No
21. Do you allow sale by private treaty previous to start of auction?
‘ as Yes
b. No

22. If the answer to 21 is yes, is regular commission charged?
a. Yes
be NO

 

23. Is a lunchroom concession provided?
a. Yes
b. No

 

2h. If the answer to 23 is yes, is this lunchroom:
a. Leased out
b. Operated by auction operator
c. Other'arrangements

 

 

25. 'Nhat is your most important source of market information?

 

OPERATING PROCEDURE

26. Office procedure - try to obtain forms used and order in which these are
processed.

27. Try to get schedule of selling charges by species, or make out as complete
as possible below (including yardage, commission, insurance, feed and
service fees if any of these are required). Use back of page if necessary

28.

-h

115

CODE NUMBER

What percentage of the livestock supplied to your auction came from the
following sources in 1951?

 

 

DEALERS AUCTION
mums AND TRADERS OPERATORS OTHERS
1 2 3 h

 

a.
b.

c.
d.

f.
g.
h.
i.
J.
k.
1.

Feeder heifers and
steers

Slaughter heifers
and steers

Slaughter cows
Calves (vealers)

Bulls

Dairy replacements
Sheep and lambs
Feeder lambs
Feeder pigs
Barrows and gilts

.Sows

Boars and stage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

29. What pacentage of your livestock was purchased by the following buyers in 195
PACKER ORDER TRADERS OTHERS
BUYERS BUYERS & DEALERS FARMERS (local butcher
1. 2 2 A s

 

a.

b.

d.
e.
f.
g.
h.
i.
J.
k.
l.

Feeder heifers and
steers

Slaughter heifers
and steers

Slaughter cows
Calves (vealers)

Bulls

Dairy replacements

Sheep and lambs

Feeder lambs

Feeder pigs

Barrows and gilts

Sows

Bears and stage

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

30.

What percentage of the livestock received at your auction comes from within
the following distances?

_L;

 

SLAUGHTER
CATTLE

FEEDER CATTLE
AND CALVES

DAIRY
COWS

VEALERS

BUTCHER
HOGS

FEEDER
PIGS

. SHEEP
«MAME

FEEDJEJ
mung

 

l

2

3

S

6

7

8

 

a.
b.
c.
d.

w

under 11 miles

 

11-25 miles

 

26-50 miles

 

over 51 miles

 

 

 

 

 

 

 

 

 

 

31.

32.

33.

3h.
35.

36.

37.

38.

39.

1:0.

.. 5 .. . CODE NUMBER

Where would you say most of the following classes of slaughter livestock
finally and up - City or Market
3. 311113
b. Vealers
c. Sheep and lambs
d. Butcher hogs
e. Slaughter cattle

 

 

 

 

 

Where do you get most of your help on sale day?
a. Local farmers
b. Local schoolboys
c. Local factory workers
d. Regular traveling auction help
e. Other

 

 

What care is usually given to the livestock before the sale?

a. Feed and water
be Water only.
c. No feed or water

 

 

When does most of the livestock arrive for the sale?
Are there any guarantees made on consigned livestock?
a. Yes
b. No

If the answer to 10 is yes, what are these guarantees?

 

How much time do you give the buyers to remove their livestock from the yards?

What charge is made for leaving this livestock in the yards over the alloted
time? .

CREDIT POLICY

 

How do you check on the financial condition of new buyers?

Did you have any losses from bad checks or other non payments in 1951?
a. Yes
b. NO
How much were your losses from these bad debts during the year 1951?
If you had losses in 1951 - from these bad debts - what were most of these
losses due to? '

How serious do you consider this problem of bad debts?

What method of settlement is followed for livestock sold through your suction“
(Use back of this page if necessary.)

b5.
us.
h7.

52.

53.

5h.
55.

57.
58.

59.

- 6 - CODE NUMBER
BUILDINGS AND GROUNDS

What was the original cost of the auction building?

 

What would you estimate it would cost to replace this building today?

DO you own or rent the present auction property?
a. Own
b. Rent
Co Other

How many acres are there surrounding the sale barn that you could make use of?
A acres.

How marw acres surrounding the sale barn do you actually use for yards, park-
ing lots, etc. (exclude that part occupied by building)? acres.

What is the total amount of pen space available (excluding alleys) q. fto

. 3
Was the auction building built specifically for livestock auctions?
a. Yes
b. No

 

Is the sale barn a:
a. New building
b. Remodeled old buiming A
c. Old building not remodelecf greatly
d. Other as (fair grounds)

ELEPMENT

What type of scales do you use?
a. Registered beam
b, Other

 

 

 

 

 

 

What is the approximate age of these scales?

 

How often are these scales tested?

 

What is the minimum graduation on the scales?

 

What is the minimmn weight that can be handled on the scales?

 

What is the total beam capacity of these scales?

 

What facilities does the auction have for feeding and watering the livestock?
SPECIAL PROBLEMS
WHAT ARE YOUR MAJOR OPERATING PROBLEMS? (Continue on back if necessary).

61.

62'.
63.
6h.
65.
66.

- 7 - CODE NUMBER
FACILITIES - CHECKED BYIMERVIEWER
Is the livestock sold too fast?

a. Yes
b. No

 

 

What is the average length of selling time per animal?

Can the auctioneer be clearly understood?

 

How many unloading chutes are there?

 

How many loading chutes are there?

 

What would you estimate the seating capacity of the amphitheatre to be?

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

67. Are railroad facilities available at the auction?

a. Yes

b. No
68. Are buyers permitted in the sale ring?

a. Yes

be NO
69. What is the size of the sale ring? sq. ft.
70. e

YARD CAPACITY NUMBER OF APPROXIMATE
AT ONE TIME PENS w SIZE OF PENS
l 2 3

a. Cattle and calves
b. Begs and sheep
c. Bullgpens
71. 'What percent Of the total pen space is under cover? i.
72. 'What type of flooring is used in:

as Pens

be Alleys

c. Ring "‘
73. Is an amplifier used by the auctioneer?

80 YES

b. No
7h. Rank the following:

POOR FAIR GOOD EXCELLENT
1 2 3 h

 

a. Pens (state Of repair)
Degree of cleanliness of pens
Lighting in pens
Lighting in ring
Sound in ring (clearness
and volume)

b.
Co
d.
90

 

 

 

 

 

 

 

 

 

 

119
- 8 - CODE NUMBER

NUMBER OF HEAD WHICH PASSED THROUGH hUCTION IN 1951—52

Date Total Grcs
nth Wee Sale Cattle Calves Shae Lambs No. Head __S_ale

J

“-

 

- 9 - CODE NUMBER

 

75. 'What percent of the cattle and calves in 1951 would.you say were in the
following groups?
a. Slaughter cattle
b. Feeder cattle and calves
c. Dairy replacements
d. Vealers
e. Bulls

 

 

 

 

 

76. 'What percent of the hogs in 1951 would be:
a. Feeder pigs
b. Butcher hogs

 

 

77. ‘What percent of the sheep and lambs would be:
a. Feeder lambs

 

APPENDIX C
AUCTION MARKET SELLIM} CHAMES

 

17

CATTLE 122
17 Reporting Cattle Charges
NUMBER
OF CQ'IMISSION YARDAGE SERVICE CHARGE
AUCTIONS
I. SEVEN CHARGED BY HEAD - NO VARIATION
:1 $1.50 None .3:
: 2 1025 None .
-1 1.25 NOne 1%
2 1.00 NOne 1%
1 1.00 NOne %%
II. FOUR WITH VARIATION ACCORDING TO SALE VALUE
2 ($1.7 75 ($200 sale) $1.00 5¢/head
E 1.80 ($200400 ; 1.00 5¢/head
2.00 (MOO—1.00 1.00 5¢/head
( 2.20 (over $1.00) 1.00 5¢/head
1 ($1.50 (3150 sale), None of gross sale
( 2.00 (8150-200 ) None of gross sale
( 2.50 (Over $200) NOne of gross sale
. 1 ($1.00 ("4100 sale) None of gross sale value
é 1.25 (to $150 sale) ane of gross sale value
1.50 (to $200 sale) ane of gross sale value
( 2.00 (Over $200) NOne of gross sale value
III. VARIATION PER HEAD CONSIGNED
l 281. .25 farmer ane 1 gross
l 00 dealer NOne 1 . gross
1 (E1.25 10 head NOne gross
( 1.00 10 head and over NOne gross
1 ($1.50 .1 head NOne 1% gross
( 1.40 15 head or less NOne 1% gross
( 1.25 over 15 head NOne 1% gross
IV. COMMISSION - PERCENT OF GROSS SELLING VALUE
1 2% minimum 1. 50 None None
maximum 2.00
1 1%rgross maximum 2.00 NOne ‘%% of gross
g 1 IS gross maximum 2.50 NOne -§% of gross

123

CALVES

 

' 17 Reporting '

 

 

AUCTIONS
REPORTING COMMISSION YARDAGE SERVICE CHARGE
I. STRAIGHT CHARGE PER HEAD - NO VARIATION 12
1 .80 None 3% gross
1 .75‘ None % gross
1 .75 None None
2 .75 deacons 100? down .25 5¢/head
.75 (veal loo-1.00.44) .50 Set/head
2 .60 None of grass
3 .50 Nope of gross
2 .50 NOne 1% of gross
II. VARIATION BY SALE AMOUNT 3
1 ( .50 (less than $30) NOne % of gross
( .75 (greater than $30) NOne % of gross
I (1.00 (greater than $60) ane 1% of gross
( .50 (less than $60) ane 1% of gross
1 .( .75 (greater than $50) NOne if of gross
( .60 (less than $50) None % of gross
III. VARIATION BY HEAD DELIVERED 2
1 .60 farmer ane 13% of gross
.50 dealer ane 1 % of gross
l .75 (1 head) NOne 1% of gross
.60 (2-15 head) NOne 1% of gross
.50 (over 15 head) NOne 1% of gross
.50 (deacons ane 1% of gross

u. .. u....."‘
o. . -

A...“

-.. -
’>0.,

 

... --.

m
. l .
' >1.

 

HOGS 123

17 Reporting Hog Charges

 

 

 

AUCTIONS
REPORTING COMMISSION ‘ YARDAGE SERVICE.CHARGE
I. PER HEAD WITHOUT VARIATION ON 13 REPORTING NUMBER OR SALE
VALUE
1 (.20 barrows and gilts ane % gross
(.50 roughs NOne % gross
l (.30 all NOne 1% gross
l (.35 all None 1% gross
1 (.40 barrows and gilts None -§% gross
(.50 roughs under $50 None %Agross
(.75 roughs over $50 None % gross
2 (.50 all NOne . -§% gross
1 (.50 (all except) I Name NOne
(.75 (boars & stage over 300?) None None
1 (.50 all None 1% gross
1 (.50 all except None % gross
(.75 boars NOne ~% gross
2 (.30 straight .30 straight 5¢/head
(.40 roughs .60 roughs 5¢/head
l .75 NOne 15% gross
1 .80 None Ԥ% gross
II. PER HEAD WITH VARIATION IN CHARGE PER NUMBER CONSIGNED
1 (.35 (1 head) None 1%
(.30 {2-25 head) NOne 1%
(.25 (over 25 head) None 1%
1 (.25 (greater than 2 head) ane :35
(.50 (less than 2 head) NOne %
1 (~50 (less than 10 head) ane :E%
(.35 (greater than 10 head) None %
1 _ (.50(1ess than 6 head) NOne 1%
17 (.35 (greater than 6 head) Name 1%

-¢....v

.-Ih ..,

0s... -- ..- -_ ‘4‘ -

--~- u....o . -.

. ...
.'1 1..
.‘ . .
-.-,. "‘ u-. ..-.
n
.-
1'.
u
' .
b
‘ .
‘o“ -
\
a .
- “s
" ' \-
I
. "
'l‘
.
' a
I

“a. . ,

*‘O' -0 -..—.

-0

 

o.

-0-.- -- ....._

"u-o-..-_

 

FEEDER PIGS

15 Reporting Charges

125

 

 

 

 

 

 

 

AUCTIONS

REPORTING COMMISSION YARDAGE SERVICE CHARGE
I. PER HEAD ~ NO VARIATION

9 .25 None None

2 .30 None 5¢/head

1 .30 None None

2 .35 None None

1 .35 None 1%

mmms
12 Reporting

AUCTIONS

REPORTING COMMISSION YARDAGE SERVICE CHARGE
I. STRAIGHT PER.HEAD — NO VARIATION

2 .25 .20 5¢/head

1 .25 None 1%%

l (.35 (lambs & ewes) None 3:
(.50 (rams) None

1 .35 None 1%

l (.35 (lambs) N0ne %%
(.50 (ewes & rams) None %%

2 .50 None %%

1 .60 None -%%

2 .30 None -%%
II. VARIATION PER HEAD DELIVERED

1 (.30 (first 40 head) NOne 1%
(.25 (next 40 head) None 1%
(.20 (each head over 50) None 1%

ROOM USE (mu,

N0 5'53
59 22 ”’1'

. 4 I
3.51 2.3 57,