Railroads Raise the Freight on a Crop Already at Rock Bottom
A half-cent-a-pound shipping increase hits Washington hop growers just as overproduction and lice drive prices to their lowest ebb.
This is rather a poor time, very poor, in fact, it seems to us, for the railroads to commence charging a higher rate for shipping hops east. As will be seen from an article in another part of this issue, the rate has been advanced one-half cent a pound. At the present time the price of hops is at the very lowest ebb, so low that many growers are discouraged and are either leaving the hop-growing business or neglecting the crop and permitting the lice to do all the damage they possibly can. This higher rate will only have the effect of making growers still more discouraged. It begins to look in the hop business as though it was getting to be a case of over-production and consequent low prices. It certainly seems as if more hops are now being raised than the market calls for. The result will be the same in this as in any other case of over-production; the greater the surplus the lower the price will be. The only remedy seems to be the one which is generally effective: more and more producers will become discouraged and will leave the business for something which promises to be more profitable. This changing will continue until the production is decreased sufficiently to bring the price once more up to normal, and usually still higher. Then the business commences to be profitable once more, and persons who are engaged in industries which are at a low ebb the same as hop growing now is, will commence to grow hops. Then again, after a time too many are once again engaged at this employment. Finally over-production and low prices once again ensue. Thus it keeps continuing, in a circle round after round.
“This is rather a poor time, very poor, in fact, it seems to us, for the railroads to commence charging a higher rate for shipping hops east.”
Freight costs and monopoly power still shape Washington agriculture; today’s hop growers face similar margin squeezes from transportation, consolidation, and oversupply. The 1890s editorial’s cycle of boom-and-bust overproduction could be written about almost any commodity today.
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