The London Corn Trade Association

The LCTA was founded in 1878 in a context marked altogether by the rapid growth of the demand for grains in Europe, the expansion of new producing regions like Argentina, South Russia or India, and a steep fall in transport and information costs, from the steamer ship to the telegraph.Footnote ²⁰ The primary objective of the Association’s founders was to answer the demand voiced by bankers and insurers for streamlined arbitration procedures and standard contracts.Footnote ²¹

On the whole, the LCTA does not appear to be a high-cost operation. From around £3,000 at the turn of the 1890s, annual receipts reached £5,000 a decade later before hovering between £8,000 and £10,000 until 1914, e.g. about one million pounds at today’s value.Footnote ²² Large financial reserves were also accumulated over time, ultimately representing well over twice the annual budget of the Association by 1910. Hence, there does not seem to have been a lot of pressure to release this accumulated wealth. The suspicion of rent-seeking comes rather from arbitration fees, especially for appellate cases: for the representative member of the top-tier Appeal Committee, they grew from £25 per annum before 1900 to £43 afterwards, which was about the annual wage of an adult male worker.Footnote ²³ This resulted, however, from an increase in the total number of cases, without a commensurate growth in the number of potential arbitrators and without any upward adjustment in per-case payments. Hence, whether or not it qualifies as rent-seeking, the practice was not allowed to debase the market over time.

The formal governance structure of the Association hinged first on an annual General Assembly that elected an Executive Committee of twenty, later twenty-five, members. This Committee met about every two weeks and was the main governing body of the Association. A Chairman was elected every year and was re-eligible once, at which point he would propose his own successor. In practice this would be the last step in a long career through the LCTA ranks where co-optation was the rule all along. This top tier was entirely made up of dominant London-based shippers (importers), millers and brokers who had often inherited their position from their fathers. Very little suggests, however, that they were seen as associate members of the imperial governing classes, with all their usual attributes, like club membership, intermarriage, and public-school education.Footnote ²⁴

More generally, the Association was a very discrete organisation which rarely boasted its success in running one of largest markets in the world. Most existing books on its rules and practices were written by merchants for their peers (or their sons), with the assumption that they already had some knowledge of business practices.Footnote ²⁵ Tellingly, the rare comprehensive presentations of the LCTA’s market were published either in GermanFootnote ²⁶ or in French.Footnote ²⁷ In other words, they were written by semi-insiders for outsiders who wanted to get in. And in an unexpected twist, this social distance or invisibility fitted remarkably well with the nineteenth-century myth of a quasi-natural, self-regulated market. It was easy indeed to give to the market’s invisible hand the credit that belonged in fact to the trade associations’ deft handling of international transactions.

Making commodities

Beyond the Executive Committee, the work of the Association rested on some ten geographic committees, like the Black Sea & Danube Committee or the East Indian one. Their six-to-eight non-remunerated members were in direct relation with the LCTA institutional correspondents, say in Kherson, Calcutta, or Durban. They directly received a host of market information, for instance on how the growing season progressed in the various regions, which colleagues had encountered problems here or there, or how given export markets worked. The whole Association was in fact a huge information clearing house, backed up by considerable collective expertise. Geographic committees would thus report for instance that:

Still, the main task of these committees was to prepare grain standards. By 1914, there were more than twenty standards for Argentine oats, wheat, or barley of different nutritive qualities, regional origin or maturation date. The grain could then be pooled in deep, competitive markets where quality would be clearly ascertained and pricing exact. The minutes of the geographic committees are full of small notes and reports that attest to how critical this process was, which transformed the highly diverse agricultural products into fungible commodities.

The by-default technique was to collect samples of grains in as many incoming ships as possible. The Association would then cautiously mix them before assessing grain humidity, the proportion of broken kernels, their nutritive quality, or the presence of ‘admixture’.Footnote ²⁹ Alternately, it could accept the grain standard made by local associations or exchanges in the producing regions, although this raised issues of trust or mutual recognition. For years, Russian market operators sent their own standards of grains, but they were never used in London, to the former’s continuing exasperation.

Yet the process of commodification was never perfect. When a grain delivery arrived at destination, divergences were often observed with the standard mentioned in the contract. Local exporters could have cheated or the grain might have been damaged by sea water during travel. It was the job of the LCTA arbitrators to appraise this divergence in quality and correct prices accordingly, downwards or upwards. Thousands of arbitration awards were rendered each year, followed in dozens of cases by a second, appellate, procedure.

Standard-making and arbitration were thus closely tied up together. They were perceived by the Association as key contributions to ‘the benefit of the trade’, hence as quasi-public goods, which served the market as a whole and should have been seen as unbiased and neutral. The principals were quite jealous of this prerogative, as of the collective expertise and market information they invested in it, which endowed them with a distinct sense of authority and legitimacy.

At the same time, power relationships along the value chain are hard to miss: grain standards were made at the very end of the supply chains by a small group of unaccountable London insiders, with powerful vested interests; the quality of grain deliveries was also assessed by them on the basis of their own standards, without relying on third-party certifiers (like rating agencies for debt issuers, for instance); and in cases of arbitration, the final price might not be decided for months. For sure this caused a lot of resentment.Footnote ³⁰ At a point, also, commodification and marketisation could be resisted by more diffuse, societal factors. Think to the social lives of peasantries across the peripheries, their diverse farming technologies, the local ecologies, also the property rights over the land, therefore the local politics. Colonial powers exercised considerable pressures as they tried to move local communities towards more market-oriented property and money relations. But there were limits to their capacity to impose on local communities a full restructuring of their production and marketing practice—say, the supply side.

‘Indian wheats are too dirty!’

Take the case of Indian wheat exports. For decades, both importers and the LCTA unceasingly complained of the large proportion of ‘dirt and admixture’ in grain deliveries, which caused extra costs: girls, apparently, were employed in London and Liverpool ‘to handpick over samples and to remove the pieces of clay and other foreign matter that have found their way in …’.Footnote ³¹ This was one of the rare grain issues that was de facto politicised: no less than six reports were submitted to Parliament during the period under review, learned journals repeatedly came back to the issue, two conferences on the poor quality of Indian wheat were organised in 1889 and 1906. A consensus was eventually formed attributing the problem to the traditional economy of ‘the natives’. Small Punjabi farmers grew different cereals in tiny fields, close to each other, so that wheats were often mixed up with oat or barley.Footnote ³² After harvesting, the grain was then kept in pits, covered by straw and cow dung.Footnote ³³ Traditional commercial practices made the problem worse: ‘every little lot of wheat has to be carried by the owner to his market, may be more than once; it then passes from dealer to dealer, each time causing expense and loss; and no two quantities being of the same grade’.Footnote ³⁴

No solution was ever found, and grievances kept coming from London. Still in the 1960s, while studying the economics of lemons, George Akerlof noticed that rice in India raised the same problems as wheat had decades before: ‘Indian housewives must carefully glean the rice of the local bazaar to sort out stones of the same color and shape which have been intentionally added to the rice. … quality variation is a greater problem in the East than in the West’.Footnote ³⁵ The London and the Liverpool Corn Trade Associations ultimately adopted a specific scale of price cuts for Indian exports, depending upon the proportion of ‘foreign matter’ in the deliveries.Footnote ³⁶ And when samples from incoming vessels proved too dirty and too heterogenous, the Association refused to make a standard. The Executive Committee would only be informed that ‘Your East Indian Committee at its meeting to-day refrained from making a July Standard of Choice White Bombay Wheat, owing to the Standard samples being so full of dirt’.Footnote ³⁷ In other words, commodification had failed.

A small portable commercial code

Materially, contracts were printed on large, two-sided forms and then sold for a small price to merchants, who would write in by hand the specifics of their transaction, like the standard of grain, the price and volume, the date of shipment, and the ship’s name.Footnote ³⁹

And as they signed these Voluntary clauses, traders also endorsed a much greater number of pre-printed Adhesion clauses on which they had no say and which stated the rules of the market. Some of these latter clauses were specific to each standard contract, others were common to all contracts that governed the export trade of a given country (e.g. Argentina). But the most important ones were written in the exact same terms on all LCTA standard contracts, such as those governing arbitration or non-payment. This way, the merchant who signed a LCTA contract form accepted that his entire transaction would be governed by the Association’s rules, hence by its small ‘portable code’. This was the condition for accessing the superior market externalities of the LCTA market. Legally, he could still use bespoke contracts, though this would imply considerably higher transactions costs for all parties (legal expertise, paperwork, etc).

This private, contractual construction was instrumental in addressing the tension between open markets and thoroughly fragmented national or territorial jurisdictions. In those times, the only official technique that addressed cross-border commercial relations was the discipline of conflicts of laws. It tells, in essence, whether and how a given national judicial system can receive, interpret and enforce foreign rights, contracts, or judgments.Footnote ⁴⁰ However, these rules were (and are) cumbersome and costly to mobilise, especially given the low unit-value of cereals. And when their foreign partners lived in a far-away, semi-sovereign Southern country, then the suspicion of lawlessness and corruption in the local courts tended to overwhelm any other concern. Chattaway, a long-time grain merchant, recalled in 1907 how, when caught in a dispute, merchants:

The Association’s portable, self-enforced codes were critical in controlling these risks thanks to their built-in extra-territoriality. Importantly, the Adhesion clauses stated that any dispute between the parties should be addressed to the Association for arbitration—not to a local court, here or there, depending upon the nationality or domicile of the merchants, the origin of the grain, or the ship’s flag. Ultimately, however, the contract and its on-board code were anchored on English law and English jurisdictions exclusively. A legal fiction written into all contracts stated that foreign merchants were all supposed to be domiciled at the consulate of their country of origin, in London, whereas Scots were nominally hosted in the offices of the Association. Hence, disputes over the wording of a contract, a given transaction, or an arbitration award could only be adjudicated by an English court of law. An Argentine, Russian, or Dutch judgment would have had no effect here.Footnote ⁴²

Significantly, over the whole period under review, the Association’s Executive Committee was never asked to enforce a single foreign judgement or arbitration award. Nor do we see a single discussion about a specific point of Romanian contract law or Canadian arbitration law. Neither did the Association call upon foreign counsels when drafting or amending its contracts. The contracts and the Association’s market rules were thus beyond the reach of foreign courts and foreign laws. The LCTA private legal order was anchored in the dominant legal system of the day, though it applied across the world—much more seamlessly in fact than the official English legal and judicial system as such, which was bound by conflicts of law rules. Yet again, extra-territoriality as a route to global market integration rested on private self-organisation, contractual ingenuity, and market power.

From a statutory perspective, this construction followed the landmark 1889 Arbitration Act, which drew a clear line between the last-resort oversight by English courts and the ‘province’ of private arbitrators, as they said.Footnote ⁴³ Self-regulation by the different ‘trades’ was a full part of the imperial construct though within the British hierarchy of norms and jurisdictions.Footnote ⁴⁴

Three contractual plug-ins

However, if they were to be adopted by international merchants, the LCTA contracts had to be effective, watertight vehicles. The grain had to pass from hand to hand, and from train to ship, without lapses or holes, hence with no uncertainty as to who held which rights and responsibilities at which point: the exporter, the ship captain, the port authority, their insurers, etc. A contractual failure may have raised material threats, but it could have also opened the way for a judge to step in and make a decision that might have destabilised the whole construction.

The LCTA sale contracts were thus closely tied to three other contracts, respectively for shipping, insurance, and trade finance. Standardisation and integration resulted from a decade-long process of experimentation, which eventually made it possible for the Association to offer them as a package.Footnote ⁴⁵ More than the ‘handshake’ transaction of classic liberal lore, we should see here a complex ‘contractual vehicle’ which carried altogether the grain, the property rights over it, and the payment guarantee, from buyer to seller. And critically hundreds, perhaps thousands, of market intermediaries used these standard vehicles, which thus directly supported market aggregation, therefore competition and price-making.

First were the so-called usances, which belonged to the local institutional set-up of each export country or export harbour. Which units of measures for weights and volumes apply in Bristol, Cadiz, or Bergen? Which institution is the legitimate authority to announce, by telegram, that the ports of Odessa or Riga have frozen and that traffic (hence, the execution of contracts) is interrupted? Who has the material responsibility if the grain falls into the water when being transferred into ships?Footnote ⁴⁶

For the value chains not to fall apart, each standard contract had to fit exactly into these local usances, more generally into the local institutional set-up of each ‘bridgehead’. The point was neither to write down entirely the usances in the contracts, nor to impose the rules, for instance, of the Port of London: the Association recognised the local trading customs in export countries and it often conceded when a local authority argued that it had long been accepted practice to take option B rather than A, on a given issue.Footnote ⁴⁷

When adjusting its contracts to the varied domestic environments, the Association dealt almost exclusively with non-governmental organisations: the Argentine Centro de Cereales, the Odessa Bourse, the Hamburg Börse, the Chambre Syndicale de Marseille, etc. Once it had opted out of inter-state coordination, based on treaties, rules of conflicts of law, and diplomacy, the Association had to build its own proprietary network of norm-setters and norm-enforcers. And all along, the LCTA’s principals avoided at all costs any binding interactions with public authorities, whether governments, courts, or standard setters.

Adjustments to the conditions of each ‘bridgehead’, hence negotiations and ad hockery, are everywhere to be observed in the LCTA archives; but ultimately the structure of contracts and the arbitration procedure were all very similar, and all were subject to English law exclusively. In particular, the political status of exporting regions or countries did not have a massive influence if we compare for instance independent countries, like Argentina, to colonies or dominions, like India or Canada.Footnote ⁴⁸ In the former case, relations with the London Association seem to have worked in a rather business-like manner, probably because Argentine exports were controlled early on by a few big merchant houses.Footnote ⁴⁹ But relations with the market operators in the United States and India were much more fraught, with some conflicts extending over months or years. Yet in each case, the LCTA principals insisted on having, symbolically at least, the last word.

The second plug-in tied together the Association’s sale contract and a Bill of Lading, which is, altogether, a maritime transport contract, a property title regarding the goods, and a proof that the ship’s captain has received them, hence that they have been loaded onto the ship.Footnote ⁵⁰ The LCTA was thus regularly in discussion with the UK Chamber of Shipping, which was the main professional organisation of shipowners. This converged on a series of regional Bills of Lading, such as for Australia or Danubian countries, primarily Romania. But they failed, for instance, to reach a similar result in the case of trade with the United States, and each shipowner continued to use its own bespoke Bill of Lading.

The last of these three articulated contracts, the insurance policy, is also an old, well-known contract that accepted large variations in its degree of standardisation.Footnote ⁵¹ The main interlocutor of the LCTA here was the Institute of Underwriters, an institution indirectly attached to Lloyd’s.Footnote ⁵² Negotiations could go on for months to settle an ad hoc clause to be included into the Association’s sale contracts, which would delineate the respective rights and commitments of the parties.

As a whole, this assemblage of three contracts belonged to what is called the Cost, Insurance and Freight (CIF) technique of contracting, which offered considerable advantages: standardisation made transactions considerably easier, all parties were brought under the English legal umbrella, and these documents being accepted as a legally valid representation of the grain, they could be the instrument of secondary exchanges. If the initial buyer (importer) eventually concluded that he did not need the incoming grain delivery, he could resell it to a third party and hand him the said documents against payment.

While the practicality of contract standardisation seems evident, a long line of legal scholars have discussed till today the theoretical implications of this innovation.Footnote ⁵³ Can these arrangements be considered as a variety of contracts? Do they threaten competition? Or do they de facto imply unequal relations between larger and smaller firms, or between London insiders and foreign merchants? Drawing on the experience of CIF contracting and commodity markets, the great American legal scholar Karl N. Llewellyn concluded that:

He then continued: ‘It is a form of contract which … amounts to the exercise of unofficial government of some by others, via private law.’Footnote ⁵⁴ The LCTA contract drafters actually withdrew from the parties’ bargain a mass of clauses that were codified and uploaded in the contracts. They thus became default clauses that applied uniformly across borders, in an environment otherwise fractured by national codes and regulations. The LCTA thus offered a kind of alternative to clear-cut opposition between the market and the firm, hence between negotiability and administration (or codification).

Trade finance: From grain to gold

After the grain and the contracts, the last step in the standardisation process was about trade finance. Leaving aside the bank-based technique of Documentary Letters of Credit, the usual technique relied on bills of exchange. In the simplest case, after an Argentine exporter had sold and shipped the grain, he would give to his local banker in Buenos Aires original copies of the Bill of Lading, the insurance policy, and an unsigned Bill of Exchange, which materialised the demand for payment. These three ‘documents’, as they were called, were then sent by fast postal boat to the importer’s foreign trade or colonial bank, probably in London, who would ask our importer to come sign the said Bill of Exchange: he thus recognised his payment obligation and committed himself to pay, at maturity. In exchange, he received the Bill of Lading and the policy, which he would hand over to the ship captain against the grain, upon arrival. The symmetry between payment and grain delivery made the transaction essentially safe to both parties.

Still, the maturity of the Bill of Exchange typically extended well after the ship’s expected arrival, allowing the importer to resell the grain before having to pay for it: then as today, most merchants did not have the working capital to finance the whole trading cycle. In turn, rather than keeping these bills till maturity, and hence freezing their own capital, the foreign trade banks often resold them on the secondary market, typically to large deposit banks, which invested their excess liquidity in these short-term bills and kept them till maturity.

The nexus between trade and finance was an operation called ‘acceptance’ whereby these three- to six-month bills of exchange (also called London Bills) were endorsed, or guaranteed, by a high-reputation London-based bank, typically an elite merchant bank (hence a third category of banks).Footnote ⁵⁵ The overall effect was thus to transfer the credit risk to this institution while completing the standardisation process at work along the whole value chain: after the grain and the contracts, the specifics of each individual merchant were now being absorbed and his debt transformed into a safe, English-law, fungible, tradable paper.

As the great German-American banker Paul Warburg wrote, ‘through the acceptance or indorsement … the merchant’s note … becomes a liquid asset, part and parcel of the system of tokens of exchange which serves as a substitute or as auxiliary currency’.Footnote ⁵⁶ And just as in the previous stages of this standardisation process, massive information and professional expertise were mobilised in order to further reduce the idiosyncrasies present in each individual transaction.

The long value chain that originated in Bombay or Montreal now led straight into the London money market.Footnote ⁵⁷ In the absence of a large public debt before 1914, accepted foreign trade bills, particularly from import trade, were the main short-term securities used by financial institutions for liquidity management purposes. Even the Bank of England used them for market interventions and last-resort lending: in case of need, a commercial bank with a package of accepted trade bills could easily obtain hard cash against them.Footnote ⁵⁸ The most powerful Central Bank in the world thus stood ready to buy the merchants’ debt against pounds sterling, the ultimate international currency. After the insolvency risk had been covered by the accepting bank, the liquidity risk was essentially absorbed. Both Britain’s money market and its supply of foreign primary goods could not be threatened by the vagaries of capital markets.

Of course, discounting high-quality private bills had been the Bank’s stock in trade since foundation. What is striking here is the size of the underlying market, its international character, and how the Bank of England endorsed and backed up the Association’s private market order, based on contractual engineering and systematic standardisation (see Figure 1). Any doubts regarding the integrity of the value chain, disruptions by foreign authorities, or breakdowns in the underlying information flows would have immediately impaired the safety of the debt titles, hence their central position in the London money market.

Figure 1. Standardization and the LCTA value chain.

Carrying the market

A different, more intrinsic fragility of this market order came from the position of individual merchants as pure rule-takers vis-à-vis the Association: they had little voice in the design and the operation of this market, while the Associations’ principals, who were all dominant merchants, were in a strong position to defend their vested interests and extract rents. Many on the Continent actually complained that arbitration in London was biased. For Jöhlinger, a German, it was ‘in no way reliable’.Footnote ⁶¹ Van Hissenhoven, from Antwerp, also mentions ‘rather unpleasant experiences’ and even ‘considerable abuse’.Footnote ⁶² An aggrieved Austrian merchant, Maximilian Praschkauer, published a well-argued, critical pamphlet against London arbitration in The Miller, the main journal of the profession in London.Footnote ⁶³ Others underlined that, contrary to the practice in London, appellate arbitration on the Continent was always anonymous. Even a semi-official English report on commercial arbitration conceded that London arbitration was not up to the best standards:

At the same time, the underlying long-term risks were not lost on the LCTA principals, as its Chairman underlined at the 1907 General Assembly:

The minutes of the Executive and geographic committees are indeed full of letters exchanged with foreign, typically European merchants, whose demands were often constructively received. The large French merchant house, Dreyfus Frères, which had a branch in London, adhered to the Association in 1891 and was soon represented on the Executive Committee. Over time, loose forms of coordination also emerged with other European grain trade associations, when conflicts arose with Russian or American exporters or exchanges.Footnote ⁶⁶

In practice, however, what the Association absolutely needed was that market participants in general kept using its trading platform, hence its contracts, so that it ‘carried the market’. The comparative advantages of the London trading place were certainly at work when a contract was launched, but the Association did not have an enforceable monopoly. In the early 1900s, for instance, the Berlin grain association drafted a contract for trade with Russia, which became the standard for German grain merchants; but when the same association issued a contract for Argentine grains, it was rejected and the merchants continued to trade with the LCTA forms and under the Association’s rules.Footnote ⁶⁷

On another occasion, in 1908, the Executive Committee initiated a discussion on whether or not—and to what extent—clauses across contracts should be further unified. This proposal could have been seen as a further step in a process of standardisation that was at the core of the Association’s initial mandate. But it caused a lot of uncertainty and protestation. The East Indian Committee, for instance, opposed the introduction of changes in contracts ‘merely for the sake of a visionary uniformity’.Footnote ⁶⁸ Quite soon, the whole project was thus rejected and never discussed again. The Association’s Chairman could only conclude, somewhat pitifully, that ‘to build up new [contract] forms was very dangerous and not desirable’.Footnote ⁶⁹

This suggests that, once all market participants had signed on the same Adhesion clauses and were de facto coordinated by them, parametric changes in these default rules could have a material impact on the distribution of risks and rewards. Even discussing the possibility of such changes could affect how merchants calculated their position and investments.

The power to standardise

Still, the LCTA market platform did not collapse on itself. As late as 1928, a French author, George Schwob, noted that ‘there is not a European house of some size in the grain trade, which is not part of the LCTA, whether in France, in England, in Belgium, in Holland, in Germany, in Italy, in Scandinavian countries’.Footnote ⁷⁰ The LCTA standard contracts also long remained popular.Footnote ⁷¹ Dutch, French, and German merchants had them translated. French commercial courts even addressed many cases based on them, assuming, somewhat curiously, that they were in fact governed by French contract law.Footnote ⁷²

The LCTA market rather experienced a gradual process of attrition in which the relative decline of Britain after the First World War certainly had a role. Market externalities became less powerful in London. The structure of the international grain trade changed as well: open competition between dozens, if not hundreds, of merchant houses, with high turnover, gave way during the interwar, and even more clearly after the Second World War, to a highly concentrated structure entirely dominated by vertically integrated trading multinationals, like Cargill, Bunge, and Dreyfus.Footnote ⁷³ Rather than the main coordinating mechanism, the market eventually became in this new environment an instrument to adjust residual supply and demand at the margin.Footnote ⁷⁴

Beyond, two factors seem to have played a strong role in this transition. The most striking one is, of course, the collapse of international markets in the early 1930s. Since the 1870s on, the integration of producing regions and countries into global markets had reached considerably farther into the fabric of local economies and societies than during previous centuries. From Latin America to the American Midwest and pre-war Russia, the lives of millions of often vulnerable farmers were now directly dependent upon grain exports. Most often, export-oriented, landed interests also exercised considerable pressure altogether on income distribution, on the local political systems, and on trade policies. The crisis of the 1930s then destroyed this old class coalition and empowered farmers unions, protectionist lobbies, and new nationalist elites.Footnote ⁷⁵

But well before the 1930s, an industry-specific discrete change in the technology for marketing grain had gradually debased the old market order. Starting in the United States already in the 1860s, grain was increasingly transported in bulk, by railways and steam ships, rather than in jute sacks and then by sailing ships, as had been the case for decades. In the producing regions, at origin, farmers now delivered their production into silos built along the railway lines, so that it could be directly loaded on trains. In the export harbours, ‘electric elevators’ then pumped the grain directly from train carriages into the hulls of steamers. An LCTA President thus warned in 1901 that this ‘monster combinations of American railways with Atlantic steamship lines … must, necessarily, be of consequence to the trade’;Footnote ⁷⁶ a ‘kind of Darwinian process of development’Footnote ⁷⁷ was now at work, he later added.

Critically, in this new world, grain quality was appraised immediately after harvesting, so that similar types of grains would end up in the same silo (or internal container). They were thus graded at the entry point of the value chain, literally when leaving the farm, and not at destination, in the import country, as was the case under the old trading regime. How this marketizing technology expanded and who gained from it are questions which belong to a complex political economy, with deep roots in the social and economic history of each producing country.Footnote ⁷⁸ Silos did not easily become fixtures of the rural landscapes of the US Midwest, the Argentine Pampas, or Ukraine. Railway companies, farmers’ cooperatives, large merchant houses, exchange operators, later multinationals: they all manoeuvred for decades to impose their standards, their expertise, and their interests, quite often under the strong oversight of a new, powerful regulatory state.Footnote ⁷⁹

If anything, the best signal of this trend in the US was the decision by the Department of Agriculture in 1913 to affirm its own regulatory power: from then on, all grains commercialised in the country would be assessed and valued on the basis of constant ‘gradings’ based on the up-to-date expertise of a whole new corps of state agronomists. In January 1914, the LCTA thus received a three-line message from one J. W. T. Dunel, ‘Crop Technologist in Charge’, in Washington. He had ‘the pleasure of sending you herewith copy of the grain grades as finally fixed and promulgated by the Department of Agriculture to take effect on July 1, 1914’.Footnote ⁸⁰ The days were over when a few private gatekeepers in London could bypass interest groups and governments all over the world and impose their standards and sanctions.Footnote ⁸¹ Inevitably, their own proprietary trading routes, fully governed by small portable codes, also declined. Not much of a place would be left for this old merchant elite in the new world of progressive governments, developmentalist states, and big multinationals.