Kansas City competitors are Omaha, Nebraska City and Atchison; in the eastern and southeastern portions of Missouri, Kansas City largely supplies the trade. In those sections St. Louis and Chicago are the competitors. Testimony tended to show that an advance of the sugar rate from San Francisco to the Missouri river of ten or even five cents per hundred pounds would result in sending the raw sugar by ship from the Sandwich Islands to New York and other Atlantic coast points to be refined there. And that any material advance above the 65 cent rate on sugar would stop the traffic from San Francisco to the Missouri river.

One reason why a low rate on sugar can be made from San Francisco to the Missouri river is the great number of empty cars that would otherwise be hauled east. All the lines have a large number of east-bound empty cars. The proportions of west-bound and east-bound traffic are about sixty per cent. west-bound and forty per cent. east-bound. On the Atchison line, of the empty cars going east about ninetynine per cent. seek the Missouri river. The sugar traffic is about sixteen to twenty per cent. of the east-bound tonnage of the roads.

A maximum rate for a considerable distance prevails on the different lines, the increase from San Francisco being gradual until the maximum is reached, and the decrease also gradual until the minimum is reached at the Missouri river. On the line of the Atchison, Topeka & Santa Fe road the maximum is reached at Dodge City, and is $1.10 per hundred pounds. On that line the shipments from San Francisco to intermediate points that take the combination rates from the Missouri river do not exceed five per cent. of the total. On the route of which the Union Pacific road forms a part the maximum rate applies from Reno, Nev., and on the Union Pacific proper extends from Ogden, Utah, to Victoria, Kan., and is $1 per hundred pounds.

The practice of the lines has been to show on their tariffs only the through rate from San Francisco to the Missouri river, and the locals from the latter points, and not to show the rates from San Francisco to the intermediate points. New tariffs have since the hearing been issued that show

both the through rates and the rates to intermediate points. The proportion of shipments from San Francisco to intermediate points on the Union Pacific line, exclusive of Cheyenne and Denver, is about twenty-five per cent. of the total carriage.

The rate per ton per mile on sugar on the Atchison line from the Pacific coast to the Missouri river is about six and a half mills, and the 85 cent rate to Humboldt gives about eight and a half mills per ton per mile. These rates are less than the average gross earnings per ton per mile on that line in 1888, when it was a fraction over one and a quarter cents per ton per mile. The operating expenses were eightyfour hundredths of a cent per ton per mile The gross amount of fixed charges on this system is $4,968,773. Taking into account all the traffic east of the Rocky mountains, the proportion of the traffic to points west of the Missouri river would be about one-third of the whole. If the combination method of making rates based on the Missouri river were not allowed, the carriers claim they would be obliged to advance the Missouri river rates in order to protect the revenues of their lines. Evidence was given to the effect that it costs from thirty to forty per cent. more to haul a train of loaded cars than a train of empty cars of the same size. The question of empty cars does not affect interior points as much as Missouri river points, for the reason that the cars have to go to the Missouri river to be loaded with goods. To some of the intermediate points reached by roads leading from the direct lines the grades are heavier, and more cars can be hauled by the same engine to the Missouri river than to most of the intermediate points not on the main line. Cars taken to Humboldt and some other intermediate points to be unloaded have to be hauled empty to the Missouri river to be loaded and go west again. This deflection of cars from the main line to be unloaded at intermediate points and then hauled empty to the Missouri river adds fo some extent to the cost of the service in reaching such points.

There are some exceptions to the rule of charging on sugar from the East the rate to Kansas City plus the local rate to

points west of Kansas City; in southeastern Kansas the rates are based on the rates to St. Louis plus the local to destination. Humboldt is one of these, and Fort Scott, Chanute, Independence, Iola, Garnett and Ottawa are others. The rate on sugar from San Francisco to the Missouri river is a commodity rate. Carriers claim that it is not a reasonable and just rate to them, but that it is all they can get, and that if they charge more sailing vessels will get the traffic. The Southern Pacific road is the initial carrier, and its proportion of the 65 cent rate is about six mills per ton per mile, which is estimated to give about two mills per ton per mile above the cost of the service. This road carried in 1888 about 30,000 tons of sugar routed to the Missouri river, and about 15,000 tons went to Arizona and New Mexico to local points. The shipments of traffic to all intermediate points on this line are about equal in volume to the shipments for the Missouri river. The charges to intermediate points by this line are nearly all maximums, and are $1 per hundred pounds. The maximum is reached at Reno, Nevada, and continues on beyond Denver and includes all larger towns. The rates from the Missouri river to Denver have been greatly reduced within the last three years. There was a period before the law when the rate on sugar to the Missouri river was 50 cents per hundred pounds; at that time the rates to intermediate points were much higher. On the Southern Pacific proper direct rates are given to intermediate points on the tariff sheets.

On the Union Pacific line the average rate per ton per mile received in 1886 was 1.359 cents; in 1887, 1.276; in 1888, 1.173; not including company freight. On Pacific coast business the average rates received were: In 1886, .584 cents; in 1887, .773; in 1888, .925. On east-bound Pacific coast business these averages were: In 1886, .63; in 1887, .81; and in 1888, .85. On west-bound Pacific coast business they were: In 1886, .55; in 1887, .74; and in 1888,.98. The ratio of operating expenses of this company (exclusive of fixed charges) during the same years, to the gross earnings, was as follows: In 1886, 57.75 per cent.; in 1887, 53.38; and in 1888, 55.84. Estimating the approximate cost of Pacific coast

business at the same ratio as found for the cost on the entire business of the Union Pacific Company, the cost of moving sugar in 1888 was about .475 cents per ton per mile. At the 65 cent rate this company receives on sugar to Kansas City a little over .51 cents per ton per mile, leaving a profit above the estimated cost of nearly 4 of a mill per ton per mile, equivalent to about $6 per car of twelve tons.

The complainants purchase granulated sugar exclusively in San Francisco, except sometimes small quantities in New Orleans. The sugars they purchase at New Orleans and at Philadelphia, New York, and Boston are nearly all yellows. Of the sugar brought to Missouri river points about forty to forty-five per cent. comes from the Pacific coast, and about fifty-five to sixty per cent. from the Atlantic coast and the Gulf. The total competition of California sugar on the Missouri river was stated to be from two hundred to two hundred and fifty thousand barrels.

The water competition in the carriage of sugar from San Francisco by way of Cape Horn was shown to be as follows: In 1888 one firm chartered four vessels carrying raw sugar from San Francisco to New York for $4.00, $3.78 and $3.87 a ton. Vessels have been chartered as low as $3.75 a ton on sugar to New York. These rates might be obtained from January to July. Sugar is packed in bags when it goes by water, and requires an average of one hundred and ten days to go from San Francisco to New York. Other evidence showed that four vessels were chartered in 1887 and three in 1888 for this traffic. These charters were at $4.00 a ton for one vessel and $3.75 for the others. This is about 20 cents per hundred pounds. No raw sugar is sent at the present time for refining at the East. In 1888 from three to five vessels of three thousand tons each were chartered, amounting from ten to twelve per cent. of the importation for 1888. Sugars carried by sailing vessels from San Francisco to New York are generally damaged from five to ten per cent. A quantity of 50,000 tons shipped in that way was damaged to that extent. There are no schedule rates for the carriage of sugar by sail, the charge being regulated by the supply and demand.

The character of the combination rates to intermediate points, based on the standard rate of 65 cents from San Francisco to Kansas City, plus the local rate back to intermediate points, is shown by the following tables.

On the line of the Union Pacific Railway they are as follows:

At the time of the hearing there was no tariff in effect showing the through rates from San Francisco to the above points, but a tariff showing such rates was issued October 27, 1889. These combination rates extend westward, as far as Rossville, Kan., 83 miles from Kansas City. Lawrence, Kan., is given a rate two cents less per hundred pounds than the combination to that point. West of Rossville the rates are all lower than the combination on Kansas City. The highest rate to points on the Kansas division is one dollar per hundred pounds, and applies to all stations from Victoria, Kan., to Denver, Colo.

On the line of the Atchison, Topeka & Santa Fe Railroad combination rates are as follows: