car-lot movement of 234,500 cars for the United States as a whole. The fresh vegetable shipments from California and Arizona likewise constitute an important percentage of the entire United States carlot movement of fresh fruits and vegetables. Because of the size of the industry, its geographical distribution, and the number of commodities involved, the agreement is in reality a number of commodity agreements placed together.

CALIFORNIA ASPARAGUS

Another agreement is being completed for the growers and shippers of fresh California asparagus. The distinct need of some means of stabilizing marketing conditions for this industry is indicated by the fact that during the spring of 1933 prices f.o.b. shipping points were 61 percent below parity. Since the price of fresh asparagus is largely determined by the supply shipped to market the control of shipments at point of origin provides the best means of increasing producers' returns. Not only are prices raised thereby, but large savings are possible in freight, refrigeration, and marketing costs. This agreement and its accompanying license are expected to be effective in ample time for the 1934 shipping season.

ENGLISH WALNUTS

The production of English walnuts in the United States is concentrated largely in California, though smaller quantities are produced in Oregon and Washington. In the past this product has been sold primarily in the shell, only the culls being shelled. Increased production and a declining demand during recent years have made it impossible to dispose of the crop without a drastic decline in prices to growers. This situation has resulted in spite of the fact that about 90 percent of the crop is marketed by one large cooperative which has used intensive methods of merchandising and advertising.

At the beginning of the 1933 season this industry was confronted with the largest supply in its history, consisting in part of a carryover of nearly 50 percent of the 1932 crop. To meet this situation, which threatened disaster to the growers, a marketing agreement was submitted to the Administration by the cooperatives of California and the Northwest. This agreement has been approved by the Administration and signed by nearly all the walnut packers, and is now in operation.

The principal provision of this agreement relates to the limitation of the supply of walnuts to be sold in the shell in the domestic and Canadian markets. The agreement authorizes a control board to determine the percentage of the available supply which may be sold in the shell in these markets. This percentage is applicable to the individual supplies of all packers. The balance of the supply is turned over to the control board to be sold as shelled walnuts or to be exported. The agreement also provides for both maximum and minimum packer sales prices. Minimum prices to producers are not provided in this agreement, since more than 90 percent of the crop is sold by cooperatives which operate on a pooling basis.

While it is impossible to determine accurately the net effect which this agreement will have on prices to growers, the sponsors of the agreement estimate that it will add nearly $2,000,000 to the purchasing power of the walnut growers.

CALIFORNIA CANNED RIPE OLIVES

The olive industry of California is primarily dependent upon the domestic market for canned ripe olives, which is supplied entirely by domestic production. Increased production of olives in California together with a decline in demand during recent years has necessitated that an increasing percentage of the crop be processed into olive oil to be sold in competition with the imported oil. This has tended to reduce the price of ripe olives to their value for oil purposes. The marketing agreement for canned ripe olives limits the pack to a quantity that can be sold at reasonable prices and provides a plan of proration among growers which aims to give all growers an equitable share in supplying olives for canning purposes. The agreement provides for minimum prices to growers and minimum resale prices by canners. Minimum resale prices are necessary in this instance to prevent price cutting by canners, particularly since a large percentage of the pack is sold by grower canners and cooperatives which do not purchase their fruit at a fixed price.

This is a continuous agreement and it is felt that it will result in material benefit to the growers of olives and to the industry in general.

INCREASE IN PRICES TO GROWERS OF CANNING CROPS

In August 1933 the Agricultural Adjustment Administration requested canners to increase their prices to the growers of certain canning crops above those stated in their contracts with the growers. Most of these contracts had been made early in the year while economic and financial conditions were extremely unsettled. Canners throughout the country cooperated in making these adjustments by raising prices of canning corn, tomatoes, beets, lima beans, and cabbage for kraut.

Prices to the growers of these crops were increased from 20 to 371⁄2 percent above those originally stated in early contracts. As a result of this action, the purchasing power of the growers of canning crops was increased at least some $3,000,000. The growers of vegetables for canning and vegetable canners have indicated a strong interest in the development of marketing agreements for these products in 1934 with a view to obtaining higher prices for growers and bringing about some control over the volume of canned vegetables packed.

PEANUT INDUSTRY

A marketing agreement and an accompanying license covering the peanut milling industry were placed in effect by the Secretary of Agriculture on January 27, 1934. The agreement provides for the payment of minimum prices to growers, and adherence to standard United States grades is made mandatory. Control of production is the principal problem in this industry and one of the main responsibilities of the control board, composed of 5 growers and 5 peanut millers, is to investigate this problem and file a report on it to the Secretary.

OTHER CROPS

In addition, proposals for a great many agreements covering special commodities have been considered by the Administration. Some of these may be developed with a view to improving the income of producers of special crops in 1934. A number of agreements were sub

mitted too late for completion in time to aid in the marketing of the 1933 crops. Such agreements were proposed for prunes, avocados, grapefruit for canning, pimentos for canning, alfalfa hay in California, olive oil, raisins, dry beans, sour cherries, and for various regional groups of florists and nurserymen.

Poultry and eggs have presented a very difficult problem in relation to marketing agreements, due to the widespread nature of the industry and the lack of organization on the part of producers and other handlers. There are over 5,000,000 farmers producing poultry and many thousands of dealers handling poultry. The products of the industry move throughout the country and in many cases are sold by direct methods. At present consideration is being given to an agreement by duckling producers on Long Island and in Massachusetts.

A list of the marketing agreements affecting special crops made effective in 1933 is given in table 18.

II. CODES OF FAIR COMPETITION

The Agricultural Adjustment Administration has had under consideration a number of codes of fair competition under the National Industrial Recovery Act for various groups of processors and handlers of special agricultural commodities. The most important are those for the shippers and wholesale distributors of fruits and vegetables; for the shippers, packers, and wholesale distributors of poultry and eggs; for the baby chick hatchery industry; for the raw peanut milling industry; for the paper-shell pecan distributors; for the pecan shellers; and for the imported date packing industry.

Codes have been approved and signed by the President for the imported date packing industry, the baby chick hatchery industry, and the raw peanut milling industry.

The proposed code for the paper-shell pecan distributors met considerable opposition at the public hearing and the industry has been requested to reconsider the matter and present to the Administration a code having more complete support from the various elements in the industry. The code for the pecan-shelling industry is in the process of redrafting.

Because of the large number of members in the wholesale fresh fruit and vegetable distributing industry and in the egg and poultry industry, and because of the lack of anything like complete organization among the members of these industries, progress has been slow in developing codes for these industries.

There have also been submitted for consideration a large number of supplementary codes relating to various segments of the egg and poultry industry, to florists, and to various groups of fresh fruit and vegetable shippers. Consideration of these supplementary codes has been delayed somewhat pending completion of codes on a national basis for these industries.

All of the above codes are designed primarily to eliminate certain unfair trade practices which have developed in these industries. Two important difficulties have been encountered in the formulation of codes satisfactory to most of the groups referred to above. Many of the groups have resisted the proposals made with reference to hours and wages, a matter over which the Agricultural Adjustment Administration has no control. The other principal difficulty has been caused by the fact that many of these groups are poorly organized,

and embrace a very large number of small individual business units. Representatives of some of these groups have expressed grave doubt about the practicability of effective administration of their codes in spite of the disposition of the majority of the industry to cooperate.

TABLE 18.-Market agreements affecting special crops and made effective in 1933

1 Basis no. 21⁄2 cans. Actual pack exceeded this slightly; the exact amount has not yet been determined. 2 Except apples. (Agreement was not consummated early enough to be operative in 1933.)

3 Includes apricots, cherries, peaches, pears, plums, and fresh prunes for 1933. Washington, Oregon, Idaho, and Montana.

Total of cherries, peaches, pears, plums, and fresh prunes shipped in 1933 and apples in 1932-33.

• Represents 25 percent of table grapes shipped from California. United States table grapes not listed separately.

At the request of the Agricultural Adjustment Administration, the canning industry agreed to voluntary price increases to growers. (No licenses issued.)

Source of data: Compiled from records of the Agricultural Adjustment Administration and reports issued by the Bureau of Agricultural Economics of the U.S. Department of Agriculture. (All data subject to minor revision.)

CHAPTER 10

SUGAR

Sugarcane and sugar beets were not designated as basic agricultural commodities in the Agricultural Adjustment Act. Benefits to producers of these commodities, therefore, could be secured only under section 8 of the act which provides for marketing agreements for any agricultural commodity.

In the spring of 1933, when the act was passed, it appeared that returns to domestic producers of beets and cane would be relatively attractive. For example, a prospective return of about $5.20 a ton was indicated for continental beet growers compared with the "fair exchange value" of approximately $5.50 per ton. Furthermore, since the United States is on an import basis for sugar, it was contemplated that sugar prices would increase as a result of the monetary policy of the Administration. This increase actually did take place and duty-paid sugar (raw basis) advanced from the low point of 2.65 cents per pound in February to an average monthly price of approximately 3.4 cents per pound for the period April to September. Continental beet growers benefited from this rise in sugar prices since their contracts with the factories are of a participating character.

Despite the fairly satisfactory prices for beets and cane which prevailed on the 1932-33 crop, it was clear that the prospective large crop of 1933 would exert a powerful bearish influence on prices during 1933-34.

In the Philippine Islands, where production had increased successively for a number of years, a record cane crop was in prospect. Continental beet growers planted by far the largest acreage which has ever been devoted to beets in this country. It was anticipated that the Puerto Rican crop which had suffered hurricane damage the previous year would be materially increased in the 1933-34 season.

Not only did this situation forecast a low level of sugar prices, but it involved a drastic reduction in probable shipments from Cuba to this country. In anticipation of price depression and disorganized marketing conditions during 1933-34, spokesmen for various branches of the sugar industry early in 1933 requested steps under section 8 of the act to stabilize conditions in the industry.

PROPOSED AGREEMENT DRAFTED

Dr. John Lee Coulter, a member of the United States Tariff Commission, was selected as special adviser to the Agricultural Adjustment Administration. An informal conference of the sugar industry was called on June 27 and a committee representing the various producing areas and the processors was selected by the industry to draft a sugar agreement which would attempt to establish a balance between supply and consumption. A tentative agreement was completed on July 19 and public hearings were held on August 10 and 11.