interests filed exhibits which set forth their rate disadvantage because of the necessity to market their rice in the east and southeast. They object to any alteration in rates that would result in more favorable rates to any of their Louisiana and Texas competitors. Lake Charles is not intermediate to New Orleans from most riceproducing Arkansas points, but an out-of-line haul of more than 15 per cent is necessary. At the hearing complainant limited its request for transit with respect to Arkansas points to the existing published through routes, and to points that do not involve an outof-line haul of more than 15 per cent. Louisiana rice is harvested about two months before Arkansas and California rice, and these interveners do not desire the interior Louisiana and Texas mills to have transit for competitive reasons.

The defendants contend that the group rate from California points to Lake Charles and New Orleans is reasonable, and that in the absence of undue prejudice we can not require that transit be established. They assert that transit on rice is not similar to that on grain, because the California and New Orleans rough and clean rice rates are the same, whereas, generally speaking, the rates on grain are considerably lower than those on the milled product, and that, when the privilege of transit is used, the higher rates apply from points of origin to destinations and the carriers do not lose as much revenue as they would if transit were accorded rice from California.

It is not necessary to discuss the law as to our authority to direct that transit be established where we are of the opinion that the peculiar circumstances with respect to the traffic warrant it. Southern Hardwood Traffic Asso. v. Director General, 61 I. C. C., 132, 141. The circumstances and conditions which justified the establishment of transit arrangements at intermediate points on rough rice from Louisiana and Texas are also controlling with respect to shipments from California and Arkansas, milled at Lake Charles.

ROUGH RICE FROM CALIFORNIA.

A considerable portion of the California rice crop has been milled in Louisiana and Texas within the last few years and shipped to consuming markets in the southeast and elsewhere. The movement to Lake Charles began in 1915 and complainant received 666 carloads between August 15, 1917, and May 23, 1918, and previously has received 300 carloads. The record shows that this extensive movement of California rough rice to southern mills was based largely on abnormal market conditions arising out of the war.

In 1915 the rate on rough and clean rice from California to Houston, Beaumont, Orange, and Echo, Tex., was 50 cents and to Lake Charles and New Orle 60 cents, minimum 40,000 pounds. These

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rates had been established primarily to apply on clean rice, as formerly little, if any, rough rice had been shipped. The rate on rough rice to Lake Charles exceeded the combination of 57.5 cents on Echo, Tex., and to that extent was found unreasonable in Lake Charles Rice Milling Co. v. S. P. Co., 46 I. C. C., 661, decided October 1, 1917. In Rice from California, 42 I. C. C., 437, a 60-cent rate on clean rice from California to Missouri River and intermediate territory, including Texas, was found justified, and on January 27, 1917, the rate to Houston, Beaumont, Orange, and other Texas points was increased to 60 cents. From this increase it resulted that a blanket rate of 60 cents, minimum 40,000 pounds, applied on rough and clean rice from California to New Orleans, the Missouri River, and intermediate territory. In April, 1917, defendants established a rate of 55 cents, minimum 60,000 pounds, on rough and clean rice to the same destination points and territories. Both rates remained in effect until June 25, 1918, when they were increased by general order No. 28 to 75 cents and 69 cents, respectively.

Complainant contends that rates on rough rice from California to Lake Charles should have been and should be 5 cents less than the contemporaneous rates to New Orleans; that prior to June 25, 1918, the rate should not have exceeded 50 cents; and that the increased rate should not have exceeded 62.5 cents. The former rate of 50 cents and the increased rate of 56 cents on barley from California to Lake Charles; an import rate of 50 cents on rough rice from Vancouver, British Columbia, and San Francisco, Calif., to New Orleans and Mobile, Ala., in effect by way of Lake Charles from December, 1916, to June 24, 1918; and the establishment by defendants on March 15, 1918, of a rate on clean rice from the eastern Texas mills. to the Pacific coast 5 cents lower than from New Orleans and Lake Charles are cited in support of its contentions. The rate of 55 cents, based on an average haul of 2,300 miles, yielded earnings of approximately 4.8 mills per ton-mile and based on the average weight of approximately 70,700 pounds, car-mile earnings of 17 cents. On several shipments that weighed in excess of 100,000 pounds each, the car-mile earnings approximated 25 cents. It is the practice to load cars to 10 per cent or more above their marked capacity, but many refrigerator cars of comparatively small capacity are used. These earnings are contrasted with the average earnings on all traffic for the year 1916 of the carriers participating in the transportation, which ranged from 13.9 cents to 22 cents per car-mile for average hauls of from 70 to 293 miles.

Complainant urges in conclusion that it would be reasonable to apply a lower rate on rough rice than on clean rice from California because claims for damage frequently occur on clean rice, but seldom,

if ever, on rough rice, and, further, that a large part of the rough rice is shipped in refrigerator cars which otherwise would move empty to the Texas vegetable producing districts. As above indicated the rates on rough and clean rice from California are blanketed over a large destination territory, and the evidence does not warrant a finding that such an adjustment is unlawful, or that the rates on rough rice should be made less than those on clean rice.

ROUGH RICE FROM ARKANSAS.

The average distance by rail from Arkansas rice-producing points to Lake Charles by the routes apparently most used is approximately 456 miles, by the shortest routes published in the tariffs 420 miles, and by the shortest possible routes 398 miles, while the distance from the same points to New Orleans via the shortest published routes is 513 miles, and by the shortest possible routes 481 miles. Group rates of 20 and 23.5 cents formerly applied to Lake Charles from points on the St. Louis Southwestern and the Rock Island, respectively, and rates ranging from 15 cents to 20 cents from other Arkansas points to New Orleans, except that the rate from Helena to New Orleans via the Missouri Pacific was 10 cents. In Rice Rates from Helena, Ark., 31 I. C. C., 614, decided October 6, 1914, we found that the respondents had justified an increase in the rate on rough rice from Helena to New Orleans from 10 cents to the blanket basis, which at that time was 20 cents, but it seems not to have been taken advantage of. The former rates to Lake Charles yielded earnings of 11.47 mills per ton-mile and 31.26 cents per car-mile.

It appears that the rates from Arkansas producing points to New Orleans were originally based on the Mississippi River combinations through Memphis, a rate of 10 cents applying via the Illinois Central from Memphis to New Orleans. The rates from Lake Charles were closely related to those to New Orleans. The increased rates are 25 and 29.5 cents from points on the St. Louis Southwestern and Rock Island, respectively, to Lake Charles, 12.5 cents from Helena to New Orleans, and from 19 to 25 cents from the other Arkansas points to New Orleans. There is little or no rice production in the section from which the lower rates to New Orleans are applicable.

Under the former Louisiana and Texas intrastate scales a maximum rate of 15 cents applied for distances exceeding 125 miles and 240 miles, respectively. These distances perhaps represent the maximum hauls on rough rice within those states, and as mills are located at numerous points in the rice belt, the average hauls are much shorter than the maximum. Based on the rates found justified in Rice from Texas and Louisiana (No. 2), 43 I. C. C., 29, extended

as hereinafter provided, the former rates from the principal Arkansas producing points, 400 to 475 miles distant to Lake Charles by the shortest routes published in the tariffs, would range from 20 cents to 21 cents and from the same points to New Orleans from 21 cents to 22 cents. The increased rates would be 25 cents to 26.5 cents to Lake Charles and 26.5 to 27.5 cents to New Orleans. Complainant contends that from points in Arkansas, in particular those on the Missouri Pacific, which line serves both Lake Charles and New Orleans, the rates should be not less than 5 cents lower to Lake Charles than to New Orleans in view of the shorter average hauls.

There appears to be no justification for rates which exceeded or exceed rates based on the scale found justified in the case last cited, extended as shown later in this report, or for a relationship less favorable to Lake Charles than would result from the application of that scale from interior Arkansas points to both New Orleans and Lake Charles.

ROUGH RICE FROM TEXAS.

From the Texas rice-producing points east of Houston the former rates to Lake Charles for hauls of 51 to 140 miles varied from 9 to 13.5 cents, and the increased rates are 11.5 to 17 cents, respectively. From Houston and points farther west, where the distances to Lake Charles range from 141 to 250 miles, the former rates varied from 14 to 16 cents, and the increased rates are 17.5 to 20 cents, respectively. From both groups to Houston, Orange, Beaumont, and other eastern Texas rice-milling points the rates were and are based on the Texas state commission scale, which provided rates ranging from 3 cents for 5 miles to 7.5 cents for 100 miles and 15 cents for hauls exceeding 240 miles. Lake Charles is 31.5 miles from the eastern border of Texas. Extending the application of the Texas intrastate scale to Lake Charles would have resulted prior to June 25, 1918, in rates ranging from 4.5 cents to 9.5 cents from points east of Houston and from 10 to 15 cents from points west thereof. The increased rates would range from 7 cents to 12 cents and from 12.5 cents to 19 cents, respectively. Complainant contends that the rates on rough rice from Texas points to Lake Charles were and are unreasonable and unduly prejudicial to the extent that they exceeded and exceed rates based on the Texas intrastate scale.

In the following table the former distance rates applying from points in Texas to Lake Charles are contrasted with the former Texas and Louisiana intrastate rates and with those found justified by us in Rice from Texas and Louisiana (No. 2), supra.

The Texas intrastate rates for hauls over two or more lines were 1 cent higher for distances 210 miles or less, 0.5 cent higher for distances between 210 and 230 miles, and for longer hauls the same as one-line hauls. The Louisiana intrastate rates for two-line hauls were based on the sum of the locals less 10 per cent, with a maximum of 15 cents prior to August 15, 1917, and 17 cents from that date to June 25, 1918.

In connection with the Louisiana intrastate rates that became effective August 15, 1917, transit was accorded at directly intermediate points, or where the out-of-line haul did not exceed 125 miles, at a charge of 2 cents per 100 pounds of clean rice in addition to the through rate. The Southern Pacific Company charged 1 cent additional for transit. On Texas intrastate traffic an additional charge of 2 cents per 100 pounds for transit applied. It will be noted that the interstate rates for distances of 230 miles and less materially exceeded those found justified in Rice from Texas and Louisiana (No. 2), supra, for general interstate application between. points in Texas, Arkansas, and Louisiana. Our order in that case