Marketing Creamery Butter

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Formerly it was customary for storage operators to negotiate loans on butter through banks, but now many cold-storage houses handle the loans themselves and hold the warehouse receipt as collateral security. The usual interest rate charged on loans is 6 per cent. The charges for insurance range from $4 to $15.50 per $1,000 valuation, depending upon the construction, location, and equipment of the building. These are based upon a yearly period and rebates are made when the butter is carried for
...a shorter time. The amount loaned on butter varies from 60 to 70 per cent of its value. It is often con- venient for butter distributors to deal directly with a storage com- pany in obtaining loans and insurance, and storage companies acting as agents in these lines facilitate their business and fill their rooms.
They can also handle smaller accounts and make larger advances, as they have the butter in custody.
MARGINS ON STORAGE BUTTER.
The margins on storage butter depend upon a number of factors, such as the keeping quality of the butter, the marginal difference be- tween the price paid and the market value of the butter when it is removed from storage, the costs of storage, and the expense of han- dling it.


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