The following table indicates the remarkable changes which have taken place in the transportation of wheat, wheat-flour, and corn to the East from Chicago since the year 1863:

The rail-shipments increased from less than one per cent. of the total shipments in 1863, to 42 per cent. of the total shipments in 1876. In view of the fluctuations in the aggregate shipments from year to year, the general tendency of traffic may be better illustrated by comparing. the shipments during the first five years with the shipments during the last five years of the period mentioned.

The rail-shipments during the first and second periods of five years were as follows:

The lake-shipments during the first and second periods of five years were as follows:

From 1863 to 1867.

From 1672 to 1876.....

This shows an increase of.....

Or 56 per cent.

Bushels. 41, 452, 727 64,792, 526

23, 339, 799

It will be observed from the table that the rail-shipments have increased more rapidly during the last four years than ever before.

The following table furnishes data similar to the foregoing in regard to the movements of flour from Chicago by lake and by rail:

The diversion of flour from the lakes to the railroads has been much more marked than that of wheat. It appears from the foregoing table that the shipments of flour from Chicago by lake during the year 1876 were only about one-sixth of the shipments by lake during the year 1863, but that the shipments by rail during the year 1876 were about eight times the shipments by rail during the year 1863. This diversion of trade from the lakes to the railroads has been more rapid during the last four or five years than ever before.

The following table furnishes similar data in regard to the movements of corn at Chicago.

It will be seen from this table that the shipment of corn by lake has not exhibited any marked decrease. There has, however, been a very large increase in the shipments by rail. It appears that during the year 1876 the shipments by rail were fifty-seven times greater than during the year 1863.

Corn being a commodity of lower value than either wheat or wheatflour, and being chiefly moved in large quantities under one consignment, the principal part of it is still shipped on the cheap water-line.

As navigation on the lakes is limited to about seven months of the year, it is a matter of interest to note the amount of wheat and corn

shipped by rail during the period when navigation is open and during the period when navigation is closed.

The following table gives the amount of wheat and corn shipped from Chicago by lake and by rail during each month of the year 1876:

Shipments of wheat and corn from Chicago by lake and by rail during each month of the year 1876.

The average monthly shipments of wheat by rail during the five months when navigation was closed were 542,256 bushels, and during the seven months when navigation was open, 620,614 bushels. The average shipments of corn by rail during the five months when navigation was closed were 1,182,283 bushels, and during the seven months when navigation was open, 1,659,051 bushels.

In order that the general facts indicated by these statistics may be clearly appreciated, they have been represented on certain charts which may be found at the end of this report.

Lake and rail lines are formed by combinations between steamerlines on the lakes and the Philadelphia and Erie Railroad at Erie, Pa., and the New York Central and Hudson River Railroad, and the Erie Railway, at Buffalo.

Chart No. 2, at the end of this report, represents the monthly shipments of wheat from Chicago by lake and by rail from 1869 to 1876, inclusive.

Chart No. 3 represents the monthly shipments of corn from Chicago by lake and by rail from 1869 to 1876, inclusive.

Very important changes have taken place in the transportation interests of the lakes during the last six years.

The tonnage of vessels employed has been very greatly increased. Vessels of three or four times the carrying capacity of those formerly built are now employed in lake commerce.

Within the same period also several steamer-lines have been estab lished which run in connection with the New York Central, the Erie,

and the Philadelphia and Erie Railroads. The economical transportation of grain on a railroad requires regularity of movement, and therefore it was found to be necessary to establish steamer-lines in order to secure proper lake connections for the roads.

Another very important improvement in lake-transportation which has tended greatly to reduce freight-charges is the employment of steam. ers having one or more barges in tow. The amount of tonnage thus employed is gradually increasing. The average freight-charges from Chicago to New York by the three modes of transportation are shown in the following table:

Average monthly freight-charges per bushel on wheat from Chicago to New York by water, (lakes, Erie Canal, and Hudson River,) by lake and rail, (lake to Buffalo, and thence rail to New York,) and by all rail, from 1872 to 1876, inclusive.

The facts indicated by the foregoing table are represented on statis tical chart No. 1 at the end of this report. The general fact is clearly indicated upon this chart, that rail-rates are very much advanced at about the time of the close of navigation, and that they are correspond. ingly lowered, at or about the time when navigation opens in the spring, thus proving the regulating power of the water-line.

For several months during the years 1875 and 1876 the railroads were engaged in a war of rates, and the actual charges were oftentimes much below the published rates.

COMPARATIVE

GROWTH OF COMMERCE ON THE ERIE CANAL AND ON THE TRUNK RAILROADS OF THE STATE OF NEW YORK.

For several years the New York Central and Hudson River Railroad and the Erie Railway have been active competitors of the Erie Canal for the commerce between the Western States and the States on the Atlantic seaboard. This competition has undoubtedly been greatly stimulated by the competition of rival roads to other seaports than New

York, namely, the Grand Trunk Railway to Montreal and Portland, Me., the Pennsylvania Railroad to Philadelphia and Baltimore, and the Baltimore and Ohio Railroad to Baltimore.

In order to appreciate the nature of the competition between the Erie Canal and the two trunk railroads of the State of New York, it is necessary to take notice of the circumstances which control shipments east from Buffalo by the several lines. The eastward traffic on the Erie Canal is now, and has been for several years confined mainly to grain and other heavy products of the West received by lake at Buffalo.

The railroads connecting Buffalo with the Western States bring very little traffic to the canal. Probably there is not shipped from Buffalo by canal, more than 3 per cent. of all the freights received by rail at that point.

The two great trunk railroads which compete with the canal at Buffalo possess, however, very great advantages, from the fact that they have both rail and lake connections with the West. Steamer-lines plying on the lakes bring to these roads a large amount of traffic from Chicago and from other lake ports. Their rail connections, viz: the Great Western Railway, the Grand Trunk Railway, the Canada Southern Railway, and the Lake Shore and Michigan Southern Railway, also bring to them traffic from all parts of the West.

The eastern and lateral rail connections of the two New York trunk roads also afford to them great advantages for through traffic to and from Atlantic seaports and interior points in the seaboard States.

The New York Central and the Erie Railroads have been enabled to secure an enormous traffic by means of these rail and water connections and branch lines. This has led to a great reduction in the actual cost of moving freights by rail between the lakes and the seaboard;-the volume of traffic being the most important condition toward securing cheap transportation. So long as the cereal products of the West were marketed almost exclusively at Chicago, Milwaukee, and other lake ports, the Erie Canal was the principal avenue of transport; but after the great trunk roads formed direct rail-connections throughout the Western and Northwestern States, they were enabled to divert a large amount of traffic from the water-line. The commerce developed as a result of the construction of these railroads far exceeds the amount of traffic which may have been diverted from the water-line to the railroads, and it is generally true throughout the country that the traffic secured by railroads has been to a much greater extent developed by them, than it has been diverted from other transportation-lines. Notwithstanding the fact that the rail-rates have been considerably higher than the lake and canal rates, the railroads have been enabled, by means of direct shipments, to effect such saving of commissions, transfer-charges, warehousing, &c., incident to transportation by the water line, as to become active competitors for the transportation of grain and other heavy products of the West.

The reduction in the cost of rail-transportation in consequence of im