The Eastern Shore Produce Exchange offered shares at
$5 each to white farmers. No subscriber could own as much as one-tenth
of the total stock and most of the shares were held in blocks of one to
five. Black farmers were not allowed to participate as shareholders but
could use the Exchange to market and sell their crops and were eligible
for the frequently lucrative patronage dividend. By 1915 the organization
had 2,500 stockholders and, extending its services to 1,000 non-stockholding
farmers, controlled 75 percent of the potato crop on the Eastern Shore.
The Exchange expanded the potential market for local produce by employing
agents in cities throughout the North and Midwest. Where once farmers
had consigned their crops to a handful of commission merchants in five
or six cities on the Atlantic coast, within two years of its founding
the Exchange directly supplied over one hundred customers in more than
twenty states. "By its system of distribution, in finding customers
all over the country," an Accomack man noted, "it has contributed
its part in relieving the demoralizing congestions of shipments to New
York, Boston and Baltimore of a few years ago." By 1930 the Exchange
had further extended its network to 616 cities in the United States, Canada,
and Cuba. The Exchange improved the reputation of Eastern Shore produce
by requiring that goods shipped under its Red Star brand be subjected
to tight quality control (previous to the Exchange, some Eastern Shore
farmers had packed pumpkins in the bottoms of barrels of sweet potatoes).
Twenty-eight local boards organized and coordinated the activities of
Exchange agents who inspected and graded the produce shipped from forty
depots and wharves on the peninsula. The Exchange also bought seed potatoes
in bulk and negotiated with (and on occasion brought legal action against)
the railroad and steamboat companies for better freight rates.
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The Produce Exchange invested in the latest
technologies of the day. From its headquarters in Onley it ran
a private telephone system between the local offices and shipping
points. It used the telephone and telegraph to receive and monitor
prices through its agents in major cities across the nation and
world - Chicago, New York, Boston, Pittsburgh, Toronto, Scranton,
Havana. The Exchange obliterated economic hierarchies. "Do
not make the mistake of supposing that Baltimore can ever become
the distributing point for Eastern Shore of Virginia goods,"
the general manager of the Exchange warned a Baltimore reporter.
"The little country town of Onley, Va., is now the distributing
point and will be such so far as man can see into the future.
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Don't you know, sir, that we can get as good
rates from this point as Baltimore or Philadelphia or New York
can possibly get?"
The Exchange pooled the prices for each day’s sales and
paid the farmers the prevailing price. The system assured farmers that
they would not pay commissions for this service, that they could gain
the highest average market price, and that their products would be marketed
with a brand, “The Red Star," nationally recognized for quality.
The Exchange could handle the sale of 200 to 350 railcar loads of
potatoes
each day with this system.
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Aggressive marketing and improved quality control stimulated demand for
Eastern Shore produce. “Better potatoes of better grades went
out in better packages to better markets at better prices than ever
in the
history of the two counties,” an observer declared. The value of
real and personal property increased exponentially. Between 1870 and
1920
the average value of farmland and buildings per acre jumped in Accomack
from $16 to $137 and in Northampton from $15 to $197. In 1910 Accomack
enjoyed the highest per capita income of any non-urban county in the
United States and in 1919 Northampton and Accomack led all American
counties
in value of crop per acre. Annually, the Produce Exchange alone amassed
receipts of $6,000,000 to $7,000,000. The exceptional year of 1920 saw
the Exchange’s receipts climb to an astounding $19,000,000. The
influx of cash encouraged the formation of new businesses. Between 1880
and 1928 the number of mercantile establishments in Northampton County
increased from 46 to 306. Banks, hitherto nonexistent on the peninsula,
opened in the larger towns. By 1919, total deposits averaged $7,000,000.
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The Richmond
News-Leader ascribed the Eastern Shore’s prosperity
to the Produce Exchange, “adequate and quick transportation,”
and the willingness of the farmers to abandon the ways of the fathers,
to experiment, and to plant “those products that promise most from
the land.” While the
News-Leader was correct to identify
agriculture as central to the peninsula’s prosperity, it failed
to note that the fisheries and lumbering industries were also, in the
words of a Northampton man, “on the boom."
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Published: 31 July 2007
© 2007 William G. Thomas III, Brooks Miles Barnes, Tom Szuba and
Southern Spaces 
