better seed. But the farmers found themselves at the mercy of the manure merchants and implement manufacturers. Phosphates and nitrates and sulphates were dear and adulterated, and it was too expensive and troublesome a matter for the small and middling farmer to get his purchases analysed. Hence the farmers naturally turned to the co-operative methods, which in other directions were already familiar in Italian rural districts. They wished to combine for purchase, so as to be able to buy at greater advantage, to save the retail profits for themselves, and above all to secure themselves against adulteration. The suggestion came from France, where the Syndicates had spread rapidly after 1884. About 1887 their introduction was first spoken of in Italy, and since 1890 their growth has been a very rapid one. At the present time there are over 300 Syndicates, and at the end of 1901 they had a probable membership of 45,000, and a yearly business not far, if any, short of 1,000,000l. It is a small figure compared with the estimated 8,000,000l. of the French Syndicates, but it is probably not much inferior to the German total. One of the Milan Syndicates sold 92,000l. worth of goods in 1901; another—that of Parma-is doing a business of over 40,000l. a year; at least five more do over 30,000l. The Italian Federation of Agricultural Societies (Federazione Italiana dei Consorzi Agrari) at Piacenza, which acts as a wholesale agency for the Syndicates, sold goods to the value of 163,000l. in 1901. The Syndicates have sprung up in various ways. Some have developed out of the existing Comizi Agrari, which roughly correspond to our County Agricultural Societies, except that they are to a slight extent regulated and subsidized by the State. It was found, however, that any suspicion of State control was unwholesome for the Syndicates; and it has also proved better to keep them, as trading bodies, distinct from societies, whose work was propagandist and educational. Hence more frequently either the Comizi have dropped their old character and transformed themselves into Syndicates, or independent societies have been formed, and as a rule have been registered as co-operative societies. Most of the Syndicates cover a province (which corresponds to an English county), though there are cases where they are confined to a smaller district or even to a single village. Their membership differs widely; in the larger societies it runs as a rule to between 300

1 See article on the Agricultural Syndicates of France, Journal R.A.S.E., Vol. 61, 1900, pp. 252-262.

Origin and Procedure of Farmers' Syndicates.

65

and 1,200. But though most of the Syndicates are purely trading bodies, and though with some exceptions—which will be mentioned below-they themselves abstain from educational work, they have recognized that the value of their work depends on education, that it is of small advantage to supply the farmer with cheap manures and disinfectants and implements, unless he knows how to use them intelligently. Thus they have a working arrangement with the itinerant teachers of agriculture, who are now fairly numerous, and who supply what is perhaps the most practical form of agricultural education known in Europe; travelling from village to village, adapting their teaching to the requirements of each locality and the intelligence of its inhabitants, corresponding by letter with individual inquirers, supervising experimental plots, promoting anything that is likely to benefit agriculture, such as co-operative dairies, or village banks, or the importation of high-class stock. The travelling teacher advises the farmer as to the kind of manure he wants, the Syndicate supplies it; and thus the two institutions admirably supplement each other's work.

A Syndicate's method of operations is as follows. As far as possible, it gets its members to send in orders beforehand. Once or oftener in the year it posts a circular to them asking for orders and enclosing a price-list. The price-list is sometimes calculated on the prices ruling in the market at the time, plus a commission of one or two per cent.; sometimes it allows a wider margin, to guard against a possible rise of prices, and if afterwards the market remains stationary or falls, it returns the balance to the purchasers. When the orders come in, they are totalled up, and are either transmitted to a particular firm or to the Federation, or tenders are invited for them. In the early history of the Syndicates, the latter seems to have been the more general procedure, as it was found to be the only means of securing reasonable quotations. But now that the Syndicates have made themselves a power, the better class of traders offer fair terms without the necessity for tenders; and it is found more convenient to place the orders at once without the delay and formalities of throwing them open to tender. In France the Syndicates so far control the prices of the market, that tenders have been almost entirely abandoned. The Syndicates, when purchasing, require a strict guarantee of quality and an undertaking from the selling firm to pay a forfeit, if on analysis the material turns out to be below the

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guaranteed quality. The Syndicates have every purchase analysed, sending the samples to some recognized public or private laboratory; sometimes they send them as far as Paris to secure the best possible analysis.

But

Beyond taking these precautions to secure the purity of the materials supplied, the younger Syndicates do no more than act as intermediaries between their members and the trader. They collect the payments and transmit them to the merchant; they instruct him as to the delivery of the goods to the station nearest to the purchasers, and they sometimes require that the purchases shall be in quantities of not less than a truckful. as a Syndicate acquires strength, it soon passes beyond this stage. It is found impossible to get all orders sent in in advance, especially in districts of small farms. The condition of supplying truckfuls only discourages the small purchaser. In order to reach the remote districts, it is often found expedient to have branch stores, where the farmer can go with his cart and fetch as small a quantity as he requires. Sometimes, when the market threatens to rise, it is to the advantage of a Syndicate to purchase in advance and stock the goods. In the case of implements unfamiliar to the district, farmers will not buy unless they can see the article beforehand. Seeds need testing and cleansing before sale. For all these reasons, most of the large societies buy in advance, without reference to the amount of members' orders, and stock a large portion of their goods. This system requires more care and business capacity than the other method; there is a chance of selling at a loss, should the market fall; and capital must be borrowed to buy or build warehouses. But these difficulties have been successfully surmounted; and it is as a rule those societies that work on these lines that flourish most. Some societies show on their balance-sheets stock in hand to the value of 4,000l. to 6,000l.

Now comes in the question of credit, the most thorny problem that the Syndicates have had to face. It is obviously to their interest to pay cash to the trader, and the majority of them adhere strictly to this practice. But how are they to do this? It is difficult to get cash payments from their members. The Italian farmer generally works on an insufficient capital, and it is not easy for him to pay in autumn or spring for expenditure, whose results he will not see till harvest. Thus, though most of the Syndicates require a deposit of 10 to 20 per cent. when an order is sent in or goods purchased from the warehouse,

very few of them attempt more. The largest society, which has in the past allowed little or no credit-that of Turin-has found itself this year compelled by failing business to give credit. The societies therefore cannot pay the traders with the moneys received from their members; nor have they sufficient working capital of their own to do so out of that. Their shares are small (as a rule 8s. to 11. each), and they wisely do not allow any one member to take up a large number of shares. The capital of the large societies seldom exceeds 1,500l., though in one case it reaches 8,000l. And though the societies sometimes have a big overdraft at the local Cooperative Bank (in one case as much as 12,000l.), this is often not enough to enable them to meet their obligations promptly. The only way out of the difficulty is to realise their members' credits in the shape of discountable paper. Bills,' accepted by a responsible person, are of course easily negotiable. But the Italian farmer has a rooted objection to give bills, and, though the Parma Syndicate has insisted on bills, and done so successfully, the other Syndicates have found it impossible to get more than a simple promissory note' at the best.

The difficulty has been got over through the assistance of the People's Banks, those admirable co-operative institutions, which exist in almost every considerable town in North Italy, and which are always ready to assist every form of cooperation. Thus, at Mantua the People's Bank will advance to any member of the local Syndicate, whose credit is good, part or the whole of the cost of the goods supplied by the Syndicate, and pays over the amount to the credit of the Syndicate's account with itself. It only asks that the Syndicate shall assist it to ascertain the solvency of its members, and it reserves the right to require a guarantee for the repayment of the advance. But, as a matter of fact, it very seldom insists on the guarantee; and it has rejected only two per cent. of the applications for advances. In 1900 it advanced nearly 4,500l. At Cremona, the People's Bank offers to open a current account with a maximum overdraft with any member of the local Syndicate, on the security of a promissory note. The account is debited with the cost of any purchases made from the Syndicate, the amount being paid to the Syndicate's credit, and it must be balanced at the end of the year. At the end of 1901 it had thus advanced over

1 These are the nearest English equivalents.

16,500l. The great honesty of the Italian farmer has made this credit system perfectly safe. It is rare for a Syndicate to have a defaulter. Purchases made on credit in the autumn are almost invariably paid for after the next harvest. Thus the Cremona Syndicate had over 9,000l. owing on July 30, 1899; but by the end of summer all was repaid except 497., and this was eventually recovered. This Syndicate with an annual business of about 40,000l. has lost 71. 4s. in bad debts in five years' working; that of Parma with about an equal business has lost 41. in nine years; those of Padua, Mantua, Bergamo, have not lost a penny.

The organization of the Syndicates generally runs on uniform lines. The following is that recommended in the model rules drawn up by the Federation, and which many of the Syndicates have adopted. There is a general meeting of members at least once a year, and this annual meeting must be held before March 15. (It may be noted by the way that the attendance at general meetings is often rather small.) The meeting passes the balance-sheet, elects the officers for the coming year, and discusses any other matter which has been placed on the agendapaper by the committee or the "Syndics," or on the request of at least one-fifth of the members. The general control of the society is vested in a committee of six, of whom two retire annually. No member of the committee may have credit for goods supplied by the society beyond a limit which is fixed by the general meeting. The committee appoint the staff, control all purchases, fix the prices to be charged to members, decide what credit may be allowed to each member, and what interest shall be charged on arrears of payment. At the head of the staff is a manager, who may be a member of the committee and must be a member of the society. The Syndicates often escape any expense of book-keeping, their books being kept for them without charge by the local People's Bank. Every Syndicate has its three unpaid "Syndics," who correspond to our auditors, but have more extensive duties, as they not only audit the accounts, but have to inspect the books at frequent intervals, and generally watch over the observance of the society's rules. The societies have other useful officers in the probiciri or arbitrators, whose duty it is to examine into and decide upon any dispute between members and the society as a whole or its committee.

The Syndicates work very economically. Salaries in the larger societies amount to less than 9 per cent. of the business