with the greatest reductions for the longest hauls, indicates that considerations other than truck competition influenced the reductions.

The interior Louisiana and Texas complainants contend that, since water competition from Beaumont and Lake Charles caused the disruption of the former rates to the Southeast, the rail carriers should have met this competition where they found it and should not have reduced the rates from New Orleans, Arkansas, or Memphis. The interior Louisiana shippers point out, as typical of the existing situation, that Memphis, without actual truck or water competition, has been given a rate of 33 cents to Charleston, which is 10 cents less than the all-rail rate from Crowley and Lake Charles. This illustration is not impressive, because under the normal basis the all-rail rate from Memphis was 15 cents lower than from interior Louisiana. Moreover the water rate from Lake Charles to Charleston is 23.5 cents and the rail-water rate from Crowley is 29 cents, or 9.5 and 4 cents less, respectively, than the rail rate from Memphis.

Interior Louisiana complainants point out also that to Macon the water-and-rail rate from Lake Charles is 46 cents and the rail-waterrail rate from Crowley 51.5 cents, whereas New Orleans has available to Macon a rail rate of 33 cents and a barge-rail rate of 28 cents. Presumably shipments from both Crowley and Lake Charles move to Macon under the all-rail rate of 43 cents, and there is no contention that the barge-rail rate from New Orleans is not made with proper relation to the all-rail rate from Lake Charles. Before water transportation became available from Lake Charles to the Southeast the all-rail rate from interior Louisiana to Macon was 15 cents over the all-rail rate and 21 cents over the barge-rail rate from New Orleans. These differences have now been reduced to 10 and 15 cents, respectively, and the differentials, Texas over New Orleans, have been correspondingly narrowed. Therefore, since relation is all that is complained of, it is apparent that interior Louisiana and Texas have gained by the disruption of the former rate structure.

These complainants contend, however, that they have not gained as much as they should have, that no reductions whatever should have been made from other shipping points and territories. When water competition forced a reduction of the rates to the Southeast from interior Louisiana and Texas, it is probable that as a matter of law New Orleans, Memphis, and Arkansas could not have compelled commensurate reductions in their rates, but it by no means follows that the action of the carriers in revising those rates and permitting New Orleans, Memphis, and Arkansas to retain a limited access to the southeastern markets was unlawful.

*Assuming that the barge-and-rail rate from New Orleans was then, as now, 85 percent of the all-rail rate.

Although adhering to their agreement, hereinbefore referred to, with other Gulf shippers that the clean-rice rates from interior Louisiana to the Southeast should generally be 5 cents higher than from New Orleans, the interior Louisiana complainants contend that they have a valid claim to the same rates as New Orleans, that under the tariffs the interior Louisiana group extends as far east as the western switching limits of New Orleans, and that since New Orleans obtains practically all of its rough rice from interior Louisiana it is arbitrary to place it just outside the group and give it lower rates on eastbound clean rice than other Louisiana mills. Regardless of what the tariffs show, the real boundary of the interior Louisiana group is more than 100 miles west of New Orleans, where the rice fields commence. Complainants' argument on this point is contradictory to their contention, hereinafter discussed, that the rates on rough rice to New Orleans give inadequate recognition to the fact that New Orleans is far removed from interior Louisiana.

A further allegation in the interior Louisiana complaint is that the maintenance by defendants of joint barge-and-rail rates from New Orleans and joint rail-barge-rail rates from Texas to the Southeast, while failing or refusing to establish rail-barge-rail rates from interior Louisiana to the same territory, results in undue prejudice to interior Louisiana millers and undue preference of their New Orleans and Texas competitors. There are no joint rail-barge or rail-barge-rail rates on clean rice from Texas, to the Southeast or elsewhere, although such rates are effective from New Orleans. For example, the present rates to Charlotte, N. C., from New Orleans are 33 cents all-rail and 28 cents barge-rail, while from Crowley they are 49 cents rail-water-rail and 43 cents all-rail. Presumably a rail-bargerail rate differentially under the all-rail rate would be of value to Crowley in reaching Charlotte. Numerous similar situations could be instanced. This record, however, contains nothing by which to determine how rail-barge-rail rates from interior Louisiana should be made, if at all. We have given considerable attention in recent years to the subject of joint rates between rail and barge lines and the relation of such rates to the all-rail rates. A wholly satisfactory solution has not yet been evolved and the entire subject is now under further consideration in Docket No. 26712, on which hearings are in progress. On the record before us we are unable to find that the action of defendants in according such rates to New Orleans and withholding them from interior Louisiana is unlawful.

The existing differentials of interior Louisiana and east and west Texas over New Orleans in the all-rail rates on clean rice to the Southeast are 10, 16.5, and 22.5 cents, respectively. The interior Louisiana and Texas complainants ask that these differentials be

reduced to 5, 9, and 9 cents as maxima. In support of this request they show that in shipping clean rice to most, if not all, destinations in the Southeast the combined transportation charges, which they are required to pay on rough rice into the mill and on clean rice out, exceed the charges paid by the mills at New Orleans on rough rice drawn from the same point and shipped to the same destination. For example, the intrastate rate on rough rice to New Orleans from most of interior Louisiana is 10 cents, and the rate on clean rice from. New Orleans to Atlanta is 33 cents. Therefore, on a 100,000-pound carload of rough rice to New Orleans the freight charges would be $100 and on the resulting 68,000 pounds of clean rice to Atlanta $224.40, aggregating $324.40. If the same quantity of rough rice were shipped to Crowley at a rate of 5 cents and the resulting clean rice thereafter shipped to Atlanta, the total charges would be $325.40, determined by applying the through rate of 43 cents plus a transit charge of 2.5 cents on the weight of the clean rice from the point of origin of the rough rice to Atlanta, plus 5 cents on the additional weight of the rough rice (32,000 pounds) which remained at the transit point. Thus in the situation described the carriers give the New Orleans miller a materially greater transportation service for a slightly lower charge, the excess transportation being represented by the longer haul of the rough rice to New Orleans than to Crowley. The disadvantage of the Texas millers in competing with New Orleans in the Southeast is even greater than that of the interior Louisiana millers. The rate on rough rice to New Orleans from points adjacent to Houston is 13 cents, the rate on clean rice from the east Texas group to Atlanta is 49.5 cents, and the charge for milling in transit at Houston is 2.5 cents. Accordingly, assuming as before an inbound carload of 100,000 pounds of rough rice to Houston, subject to a 5-cent rate, the total charges paid by the Houston miller would be $369.60, as contrasted with $354.40 paid by the New Orleans miller.

The Texas and interior Louisiana complainants feel that the existing rate adjustment unfairly deprives them of the advantage of their location, and it is principally to redress this condition that they seek to have their rates on clean rice to the Southeast more nearly alined with those of New Orleans. It is contended that when rice is shipped from interior Louisiana to New Orleans and there milled, and the product is reshipped to a point in the Southeast outside of Louisiana, the transportation both to and from New Orleans is interstate in character and, under defendants' transit tariffs, charges should be based on the through rate on clean rice from interior Louisiana, plus a transit charge, plus the interstate rate on rough rice to New Orleans, which is higher than the intra

state rate, on the weight of the rough rice not reshipped from New Orleans. The same contention was made in Lake Charles Rice Milling Co. v. Brimstone R. & C. Co., supra, and decided adversely to complainants. The record before us confirms the correctness of the conclusion there reached.

The rail distance from New Orleans to Crowley is 166 miles, and to Beaumont and Houston 266 and 349 miles, respectively. The rates on rough rice to New Orleans are 10 cents from Crowley and 13 cents from Beaumont and Houston and are considerably lower than the column 17.5 rates under the southwestern revision. There is little or no trucking of rough rice to New Orleans, but in recent years a barge canal was completed from a point on the Mississippi River near New Orleans, through the rice fields, to a point near Houston, and since then the rail carriers have encountered active competition from that source, the rice being trucked to points on the canal and moving thence by barge to New Orleans. Prior to 1931 the intrastate rate on rough rice from practically all of the interior Louisiana district to New Orleans was 18.5 cents. It was reduced in that year to 13 cents, and early in 1932 the present 10-cent rate was established. The barge canal closely parallels the line of the Texas & New Orleans Railroad across Louisiana. The total amount of rough rice transported by that railroad within Louisiana was 166.000 tons in 1929, 110,000 tons in 1931, 56.000 tons in 1932, and 65.000 tons in 1933. These figures support defendants' assertion that the reduction in the rough-rice rate to New Orleans in 1931 was insufficient, and the further reduction in 1932 was necessary to meet truck-and-barge competition. The figures do not disclose the tonnage moving from interior Louisiana to New Orleans, but there is evidence that in the fall of 1931 and spring of 1932 one mill at New Orleans received between 5,000 and 10.000 tons of rough rice by barge from Louisiana points, and that in the following season, because of the further reduction in the rail rate, all of its shipments moved by rail.

Although the barge canal extends as far west as Houston, the principal competition which the rail carriers encounter in the transportation of rough rice from that area to New Orleans is by the Gulf. Prior to November 19, 1932, when the rail rate to New Orleans was 25 cents from Beaumont and 27 cents from Houston, shipments of rough rice transported by the Texas & New Orleans Railroad between Texas and Louisiana progressively decreased frem 13.300 tons in 1929 to 3.3500 tons in 1932. In the following year, after the rate from both points was reduced to 13 cents, the shipments increased to 9.000 tons. In 1931 a miller at New Orleans received

"many thousands" of tons of rough rice by water from Houston, but since the 13-cent rate was established its shipments from Texas, have moved by rail. The 13-cent rate was designed to meet a 10cent water rate from Beaumont and Houston to New Orleans, plus trucking and certain incidental charges to and at the ports.

Finding 6-We find that the rates on rough rice from interior Louisiana and Texas to New Orleans are not unreasonably low or otherwise unlawful.

Reverting to the differentials in the rates on clean rice to the Southeast, interior Louisiana over New Orleans, and east and west Texas over interior Louisiana, an analysis shows that to 18 representative destinations in the Southeast to which key rates were prescribed in the recent southwestern revision the column 27.5 rates from Crowley exceed those from New Orleans by amounts ranging from 10 to 12 cents with an average excess of 10.8 cents; those from Beaumont are from 6 to 9 cents higher, and average 6.3 cents higher, than those from Crowley; those from Houston are from 2 to 5 cents higher, and average 3.7 cents higher, than those from Beaumont; and those from El Campo are 5 cents higher than those from Houston. Thus from each group the actual differential to these 18 destinations is less than would obtain on the average if maximum reasonable rates were applicable in all instances. Stated otherwise, on the basis of the column 27.5 rates the average differentials of Crowley, Beaumont, Houston, and El Campo over New Orleans would be 10.8, 17.1, 20.8, and 25.8 cents, respectively, as compared with existing differentials of 10, 16.5, 16.5, and 22.5 cents, and as compared with differentials which the interior Louisiana and Texas complainants seek of 5, 9, 9, and 9 cents. The diferentials sought by complainants are less than would result from the application of any scale which by existing standards could be regarded as reasonable, and no ground exists for an order requiring either the establishment of the differentials herein sought or any reduction in those now existing.

The Texas complainants ask that from mill points between Beaumont and El Campo to points in the Carolinas and Georgia as far inland as Asheville, N. C., and Atlanta, a blanket rate of 41 cents be prescribed on clean rice, applicable by rail to Galveston and Houston, thence by the Clyde-Mallory Line to Charleston, thence rail to destination. The present rates, which are combinations based on the ports,

The destinations are Birmingham and Montgomery, Ala., Jacksonville, Fla., Albany, Atlanta, Augusta, and Macon, Ga., Lexington, Ky., Bristol, Va.-Tenn., Chattanooga and Nashville, Tenn., Charlotte, Raleigh, and Wilmington, N. C., and Charleston, Columbia, Florence, and Georgetown, S. C.