Marketing American dried fruit in Europe

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Marketing American dried fruit in Europe
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Newhouse, Milton, J
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i .. .Introduction a9 summary ,......... ...... 1

iportance of Europe in .merican dried fruit trade.. 2

SIfactors affecting demand for American dried fruit... 5
Sales practices and marketing developments......6,,. 18

S: Prune packing industry in Europe ............. 31


Washington, D.C.





























































































































































































































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r M!'.33ETING A 2fICLN DRIED FRUIT IN EUROPE

h :By
.ilton J. Nowhouso
'H Specialist in Dried Fruit Marketing j/


Introduction and Summary

European markets on the average arc now taking over throe-fourths
,+ of our annual exports of dried fruits. Prunes and raisins constitute
+ the bulk of such exports and shipments in recent years have boon far
above the pro-war average. The most important European dried fruit con-
S suming areas are Groat Britain Germany, France, the Netherlands, Belgium,
and the Scandinavian countries, practically all of which arc highly in-
dustrialized and depend, to large extr-t upon irlports for their food ro-
quirerionts. iAll of these countries arc deficit producing areas as far as
fruit is concerned and as n result imported dried fruit has bccomc popular
in the diet of the people.

There are indications of increasing consumption of dried fruit in
Europe but, at the same time, competition is becoming keener. The main
competitors of the United States for the European dried fruit market are
Yugoslavia, Sprin, Greece, Smyrna, Australia and South -frica. Of these
only Yugoslavia has shown a downward tendency in production in recent years.
In most countries the production trend is upward. The relatively low
price and excellent quality of Amcrican, dried fruits in recent years have
booeen important factors in the increasing dcriand for iincricn dried fruits
in Europe. `-nother factor of imrportancc in, the expanding European market
for these products since the war has been the wider appreciation of relative
food values in dried fruits.

IMny of the European buyers of .-:crican dried fruit purchase the bulk
of their requirements in June, July and .ugust for delivery during October,
November end December. -.s prices early in the season arc frequently out
of line with the actual supply and demand situation, it frequently happens
that those who have made early purchases at high prices for the Christmas
trade arc confronted with a sudden decline in values as soon as the transac-
tions have been completed. Steps should be taken to bring prices into
line with supply and do-mand conditions. Direct buying by cooperative
societies -PnC by chain store organizations are tending to r.bsorb the
functions of the long established agent-broker and distributor-wholesaler,
a.nd dcvclopmonts along these lines must be carefully watched by the Amorican
tr.de.c


rD Bascd on investigations in Europe by Mr. Neowhouso duiiring, 1928-29 while
attached to the Division of Coopcrativo Marketing, Twhich has since been
transferred to the Federal Fcrni Board; supplemented by inform--tion supplied
by the Foreign agricultural Servicc of the Bureau of .Agricultural Economics.









The practice of buying unprocessed prun.os for repacking in certa.i:a-iM|
European centers has made r-apie progress, since the war. Hamburg lead s:.:.,iii,,
in the number of such plants in the volume of packing and in exports ,Ir
repacked prunes. The Euroncan trade is unanimous in the opinion, ho Al
that the quality of the original pack. from the Pacific coast is superiOtkS
There arc indications, that the packing of prunes in the European consIW
ing centers ha,. materially expanded the demand for this fruit during thO.::
surnior months and to that extent the prune packing industry in Europe. b"A'. '"P'
unqu-stionably boon a boon to American shippers during certain months of
the yea.r. ..i

Importance of Europe in Amorican Dried Fruit Trade I/ "
.:: ., 1
Thu Americai dried fruit export trade ii .the past five years, 1924-25 A
to 1928-29, has experienced an expansion of more than 175 per cent compared ::
with the average pro-war volume of trade. Our total exports of dried fruit.
during this period averaged 437,358,000 pounds annually as compared with
a?.i average of only 158,489,000 pounds annually during 1909-10 to 1913-1,4.
Increased shipments of r'aisins and prunes account for practically the onti e,:.,
expansion ii: the dried ruit trade. Exports, of dried apples show a decline "Y
whil- cxjorts of the othcr dried fruits increased only slightly. Prunes :"
a.re the most important item in our dried fruit exports, having consti-
tuted 47 per cent of the tote.l in the pas.t five years. Raisins come next
in importa.nce with 36 per cent of the total. VWhile Amorican dried fruits
arc o:rportac. to all parts of the world., the European market in the aggro-
gate t.a.kus c.roun'd 78 per crnt of the total. The most important Amorican
dricd fruit markets ir Europe arc the United Kingdom, Germany, the
Sccaninavi.n countries, the Netherlands, France, and Belgium.

The dcnzm.n for Ai.,cric-.n i.ried fruits in Great Britain is mainly for
raisins an: prunes aic=. those constitute 93 per cent of our total shipments
to th-.t Di..rkct. The dc..rO. in Gczrn.ny is.r.zinly for prunes, raisins and
c'ricl a.pl.cs, which constitute 88 per cent of our shipments to that market.
The Scan.V.incvian countries tzk(. mostly prunes, raisins, and mixed dried
fruits, those three constituting over 80 ojr cent of our exports to those
countries'. Mixed dri.-Ad fruits -.re especially important in our dried fruit
tr:.:le with Swcden. Shipmc:its of dried fruit to the Netherlands consist
moL.tly of ra.isirs an. prun--s which constitute 70 per cent of our shipments
to that ma.rkct. The I.Tcthorlr.nc.s is ,-.lso c: important purchasur of dried
apples. France is interested r.-ii.ly in prunes, more than 85 par cent of
our -ried fruit exports to th.-t m-."rk:.t consistinG of thr.t friit.


1/ Conrtiibutc. by the For..ign Agricultur..l SLUrvicc, Bureau of Agricultural
Ecoro. Iice.


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Op-*r ogorgonoy or when they have to fill in stocKs Until supplies arrive rrom
'*r ." A mrica.-" '. .. -' '" "" ..

i..il DRIED FRUIT: Averagc owports to Europe and to Other
N ,O Countries from theo United States.


i : : *: ,1 I" "
: Fruit :Avorago 1909-10 to 1913-14 :Averagc 1924-25 to 1928-29- ..*
S: Total : Exports :Per cont : Total : Exports : Per cent ..
S.. :F;Eports:to Europe; to Europe: Exports: to Europe: to Europe.
1.000: 1.000: : 1.000: 1.000:


Prunes
Raisins
Driod Apples
Apricots
Poaches
All others
Total


r -.
Pounds: Pounds: Per ccnt
.80,428: 66,644: 82.9 :
18,004: 2,143: 11.9
35,137: 34 054: 96.9 :
: 19,438: 17,714: 91.1
: 5,482: 26.09:. 47.6 :
: 2/1:.. 2/
:158.489: 123.164: 77.7


Pounds: Pounds:
206,479: 177,179:
158,600: 101,083:
21,691: 28,650:
19,532: 17,227:
6,793: 4,293:
16,263: 135496:
437.358: 340.928:


Per cent....
85.8 .
63.7
96.5
88.2
63 52.
83.0
78.0


DRIED FRUIT: United States Exports to Europe and to Other Countries
Avorago 1910-1914 g and average 1925-29 /
i*


Bistination


United Kingdom...:
Germany.........:
FrPjCcc ...........:
Nothorlnrds......:
Belgium....,.....:
Swodon.........,.:
Dcnnnrk. .*SU.....:
Norway......me*..:
Finland..........:
Other Europe.....:
Total Europe :
Other Countries:
Gramd Total......:


: Raisins : Frruncs : Apples
:1910-1914:1925-1929:1910-1914:1925-1929:1910-1914:1925-1929


1,000 :
pounds :
846:
506
214:

35:
90:
295:
10:
5:
140:
2,143:
185.861:
18.004:


1,000
pound s
54,132:
17,875:
2 1456:
15,340:
4,143:
7,747:
2,043:
1,324:
336:
4,695:
110,091:
54,0241-
164.115:


1,000
pounds
8 848:
29 420:
10 226:
7 238:
5 006:
1 896:
1 854:
356:
397:
11,403:
66,644:
13,784:
80.428:


. 1,000 :
pounds :
38 012:
52 212:
32 450:
12 920:
6 783:
6 063:
6 695:
3 134:
4 209:
7,421:
169,899:
29,919:
199.817:


1000


1,000
pounds
1,1.86:
17,474:
827:
9,613:
1,946:
1,136:
1,302:
321:
133:
116:
34.054:
1,083:
35,137:


1,000
pounds
1,894
12,919
1,206
7,427
527
2,512
1,268
630
723
174
29,280
1,058
30.338


Compiled in the Foreign Agricultural Sdrvicc of the Bureau of Agricultural
Economics, fram torecords of the United States Dcpartmcnt of Cormorco.
l/ For the years ending June 30.
2/ Quantitative statistics are not available.


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: j
United Kingdom..:
Gonmany**0*...*e:
Franco..........:
Netherlands.....:
Belgium........:
Sweden..... ...:
Denmark .......a
Norway.........,
Finland........:
Other Europe....:
Total Europe..:
Other Countries.:
Grand Total.....:


pounds
5,552:
5,208:
2,559:
2,205:
957:
228:
616:
165:
21:
202:
17,713:
1,725:
19,438:


ppTounds .:pounds : found's
1,9-4: 452: 790:
5,686: 1,640: 1,642:
1,374: 178: 568:
3, 564: 151: 317:
1,182: 52: 116:
871: 40: 144:
1,981: 27: 219
933: 4: 18:
S 259: 7: 188:
439: ,,58: 580:
18,232: 2,609: 4,382:
2,196: 2.873: 2,390:
20.428: 5.482: 6.772:


Compiled in the Foreign Agricultural Service
Economics, "
a/ Years ondihg June 30.'
b/' Years cr.ding December 31.
c4Not available by quantity in prb-war years.


of the Bureau


954""


:"::. in
15,17,:*:, 2;;l


5 .77 ..;
14,6 '
:. .:i;:;":.;
2.724&:. ,,,
17 s3MO9


of Agricultiurhi`,
S : ii~mi
".. .: "::"ii
... ..


..! .........
Exports by Customs Districts .... '." ,

The rmnrchandising of American dried fruit in Europe was facilitated ::;
materially by the opening of the Panamn Canal route. Shipments by this routeK::.:i
cnm be made direct from the packing centers to the large European markets at'.
a considerable saving in transportation costs. -Out of a total of 432,000,000
pounds of C'ricd fruit uxpolrtcd front the-Unitbd States to all foreign ..
markets in 1928, approximately 69 per cent was shipped by the all water route -:
direct from thc Pacific Coast ports, mostly fron Shn Francisco and
Portland, Orogon. :






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ror_'asor T ng ien; ________________________
Fruit Pacific : Atlantic Canadian :Mexican : Gulf : Total
-I I: Coast : Coast : Border :Border : Coast P d
Pounds :: Pounds : Pounds o Pounds Pounds: Pounds

143,545,728:39 821,414:13,131.,661 567 398: 161 382:197 227,583
Ij, aisins 109,864,236:15,472,433:22,994,072 1,107,805: 248 113:149,686,659
II" App les 12,226,929:25,445,213: 156,445 49,691: 121 909: 37,889,187
i1 Apricots 5,387,946: 5,323,075: 489,258 61,128: 31 209: 21,264,616
S Peaches 5,626,264: 1,469,054: 628,256 : 53,819: 8 504: 7 785,897
I ears : 3,495,509: 984,580: 82,403 : 12,085: 1 890: 4,576,467
i: Others : 9,635.827: 3 503.289 337876 : 45,489: 45,019: 13,567,500
Hr Total 299,782,439:92017,058:37,819.971 : 1897.415: 481,026:431,997,909
S Compiles in the Foreign Agricultural Service of the Bureau of Agricultural
Economics.

Factora Affecting Zuropean Demar.d for American Dried Fruit

The combined population of the United Kingdom, Germany, France, Belgium,
the Netherlands and the Scandinavian countries, whiich constitute the principal
European markets for Ame'rican dried fruit, amounts to about 176,000,000 on
a total area of only 813,000 square miles. The concentration of such a
large population in this deficit fruit producing area accounts for the
importance of the demand there for dried fruit. While dried fruits have
become popular in the diet of these countries mainly because of their
relative cheapness and highly concentrated food values, there are many
factors that affect the demand for these products from year to yeor.
Among the most important of these is purchasing power. As industrial
nations, these countries must import zmuch of their food and raw material
requirements and pay for them with the proceeds of exports, largely
manufactured goods. Anything that interferes with the industrial situa-
tion is reflected in the purchasing power of the consumer, particularly in
the event of unemployment. Other factors that have an effect on the
demand for Ancrican dried fruits are quality, competition of fresh fruit and
of dried fruit from other countries, official aids to marketing, and
consumers' preferences.

Influence of Price and Quality on Demand.

The dried fruit markets of Continental Europe are universally recognized
as "price markets". Under such trying economic conditions as have prevailed
in Europe since the war, it is quite natural that price should have been the
factor determining the quantities consumed. Shopping with attention fixed
primarily on food values for money to be expended has always been a charac-
teristic of the European housewife and for that reason price is much more of
a factor in those markets than in the United States. The relatively low
prices that have prevailed on American dried fruit since the war have there-
Sfore been a very important factor in the increasing European demand for these
products. This does not moan, however, that the European market is interested


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in price to the extent of excluding the quality factor. On the contrarpe.
the uniformly good quality, neat pack and appetizing appearance of
American dried fruits h'.vo boor. of as much importanco in: the incroasin.A1ii
European dcrmand for those products in recent years as tho: actor of
relative prices. hi

The opinion held in some quarters that Europe is maore interested in f
thec price than in the quality of our frutt hau boon created erroneously
b-. the fIact that certainr. markets .frequently absorb large quantitioskf off'
grcdu stock. Europe, however, is an excellent judge .of dried fruits. .i
Whenever shipncrs doxir. to dispose of fruit snoewhat inferior as to "
quality, such goods should be solC only on sanplc and should not be con- i
ncctCd in any mri-;2iicr rith the rogul-.r inspection service. No liberties'
should be tak.n -ith goods inspected and recognized to be "Bettor than or .
equal to avcragc'for the season, evenr though prices arc low. .The importaot.,j/1
Europcan rarkcts havc a high respect for a contract once entered into and :::
Amcrican ship-crs should at all times adhere strictly to its terms.

Conp.tition of Fresh Fruit .-'
*~~ "*-.
The extent to which the consurmtion of.fresh fruit interferes with
tha-t of dried frutt in Europe cannot be stated definitely, Satisfactory
statistics arc not available on the production of fresh fruits in most of
the .uropcr, countries, but rn.y o0 theo- arc doing .everything possible to
develop their fresh 'ruit irn7ustrics not or-ly in order to correct, as far
as climatic alid soil conditions will permit, ceIy present unfavorable trade
baln.ncc.s in fr(shli fruits but -lso to bring into use land that is more
suitable for frcsh fruit than for other crops. Lack of experience in
modern methods of fresh fr-uit culture together vith a shortage of capital
and poor organiz-.tioni, houcvcr, is making developmUr.t along these lines
slo-.7 ii- most of the potential proCucing areas in Europe. Inmportcd fresh
fruits arc readily available, th. year round. When fruits from the
Northern Hc-imisherc arc no longer on the market supplies come in from
the Southrr.. Hemisphere.

Sevcral of the Euro-pcar, Governments arc giving direct aid to the
development of their o'-n n-ation-.l fresh fruit industries. In several in-
st-.nccs nation-vide studbi-s -ire bcirs ca.rried on for the adaptation of
varittics suitable to specific localities. Ma.ny state nurseries have
bcen established for the distribution at cost of young tree stock and mfnny
schools hove been organized for specializing in the general field of
imqproveC horticulturc.l anr. packi.-ng mlcthods. In sonrac cc.sos high tariffs
have been placed on fresh fruits in order to encourage local fruit produc-
tion. Scv.ral of the countries havdanunchcd comprehensive fresh fruit
".dvorti!i',x ca.npc.igns for the purpose of stimnlating the loca-l demand for
home grorri' fresh fruits.



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rF The nations on the Cohtincnt most activeoalong the lines above
I wntionod are Austria, Hungary, Czechoslovakia, Poland, Yugoslavia,
S Switzeorland and Germa1ny. Hungary has a well developed apricot industry
;; in the Danubian plain and a program of fruit production expansion his
l been started with this industry as a nucleus. Austria, having lost the
Tyrol, is active in developing qtruit industry elsewhere. Czechoslovakia
has forrmiulatod an elaborate program and intends to use the fresh prune
Industry of Bohemia as a nucleus. Switzerland has already accomplished
a great deal in developing the apple industry, particularly around Lake
Constance, Germany has planted many of her former vineyards with apples
and cherries and rapid progress is being made in the fruit industry in
the Boden Sue Area. Considerable attention is being devoted by the
Government in Yugblavia to the expansion of fruit production other than
plums, with particular reference to the export market. Poland is attempt-
ing to build up qruno industry by introducing the "'Fallenberg" variety
for grafting on the local root stock. All of these nations, however, will
find many limiting factors in production and it will probably take a new
generation of farmers, horticulturally trained, before such programs for
*expanding fresh fruit industries -can be put into effect fully.

The trade statistics .for many of the :uropean countries indicate that
imports of fresh frutt are increasing, particularly imports of apples and
bananas. The availability of fresh apples has caused a decline in the
demajd for dried apples, particularly in thu Scandinavian markets, but in
general imported fresh fruit in most European markets is still corsidored
an.itom of luxury. It seems reasonable to assume,.hoeyvor, .that as far as
competition from fresh fruit is concerned, AmoricanL .ri.dc fruits will
continue to .hold their orrn in .European markets for many years to come not
only because of,their relative cheapness in comparison with imported fresh
fruit but also because of their inherent efficiency in the diet and their
availability during practically all months of the year. At present the
local production of fresh fruits in most of the Europoa: countries does
not appear to be much of' .a factor in the dorand for dried fruits. The
relative price of fresh and dried fruit howievor, is always an important
factor in the Luropean market.

Competition-of Dried Fruits from Other .Countries

Although the dried fruit export trade of the United .States has shown
Gains in most items since the war, there is ovidonec/of increasing conpeti-
tion in the principal consuming markets not only fram the old-established
dried-fruit producing areas of the M.editcrranoan Basin but also from the
relatively neow arcasoof the Southern Hemisphere, mainly fzom Lustralia andf
South Africa. Most of the dried fruit from the latter two countries are
marketed in Groat Britain, the supplies consisting mainly of raisins
although shipments of apricots, pcachos, pears and prunes arc increasing.
Raisins from Sryrna, Greece and Spain campote with American raisins in
practically all of the Europcar; mnrkcts. In prunes Yqgoslavia is the most
important competitor.


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Thoro has boon c. distinct upac.rd trend in the production of raisifl i
in Australia a-rd Sm-rna in recon-t years but th( Spanish crop has remo 4
fairly constant. The prwnc in7.ustry in Yugoslavia has boon declining n
importance since the u.ar duo to treoc losses resulting fracm lack of care.ii
and planting during the.war and to tho spread of insect posts and
diseases. Production of prunes in South '_frica, horevor, saorms to bo
increasing. Greece maid .ustralia furnish practically all of the currants
seld in Europe. Production in Australia shors an upward te-ndoncy. The
significant foaturos of the foreign apricot situation is the steady ox-
pansion in production in South tfrica and AusQralia. The South African
situation is of special iriportanr.ce sincc apricots from that area give
promise of becoming a vdry important factor ir. tho world n.rkct in a few
years.

DRIED FRUIT: Production of Raisins, CurrantpPrunes ,nd
Apricots in Specified Countries.


F mit
and
Country


-5-------


RAISIKS:
United States.....:
Australia,........:
Smyrna.......... e.:
Spairb.....**.....*:
Greece...........:
South Africa.... :


1919-20
to
1923-24
Short
tons

206,300:
18,841:
370C0:
18,177:
13,557:
5, 208:


CURRANTS:
Greece............: 118,600:
Australia.........: 10,715:

PRUNES:
California ........a: 114,450:
Pacific Northwvest.a/ b6,880:
Yugoslavia......... :a/ 59,495:
Franice............: 9,645:
South Africa..e....: 752:


APRICOTS:
California,......:
Australia...e....:b/
South Africa......:


16,500:
1,414:
334:


1924-25:1925-26 :1926-27 :1927-28 :1928-29 -


Short
tons :

170,000:
29,876:
56,000:
22,575:
9.103:
4,660:


172,000:
13,050:


159,000:
19,360:
4,980:
6,063:
1,2354:


16,000:
885:
549:


Short :
tons

200,o000oo:
27,752
33,000:
25,028:
8,564:
4,565:


167,000:
13,703:


146,000:
12,960:
46,456:
1,378:
678:


18,000;
654:
537:


Compiled in the Foreign Agricultural Service
Agricultural Economrics from official records
Consuls and Trade Comiissioners abroad.
T/ Two year average 1922-23 and 1923-24.
SThree year average 1921-;22 to 1923-24.


Short
tons

285,000:
48,722:
38,000:
23,700:
8,306:
5,146:


188,500:
14,290:


150,000:
40,250:
51,871:
8,488:
1,050:


13,800:
932:
979:


Division
and from


Short : Short
tons : tons

300,090: 268,OC
28P252: 58;9C
54,000: 50,OC
25,400:' 21,8C
7,118: 12,;3E
5,414: 290C


141,500:
8,540:


225,000:
19,500:
34,033:
5,500:
296:


25,000:
740:
1.109:


)0
0
)0
)0
i9
)0


157,500
21,160


220,300
5,900
20,757
990
1,500


22,120
1,680
2.750


of the Bureau of
reports of American


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Yugoslavia in prunes and the Mediterranean countries in raisins
' n joy a close proximity to the principal consuming markets of Europe.
V-hile freight rates from these areas aronot much lower compared with
iihl'" ipments through the Panana Canal the fruit is not exposed to tropical
renditions and Shipments arrive much more quickly. The time required
fl" or fruits to arrive from different countries varies considerably. It
ta1: makes from 10 to 14 days for shipments to roach Hanburg from either
N Mew York or Yugoslavia. From 4 to 6 weeks are required, however, for
shipments to reach Hamburg from the Pacific Coast via the Panama Canal.
8'hipments of dried fruit from the Mediterranean producing countries to
northwestern Europe usually take frcm 2 to 3 weks to roach their
destination. The movement of dried fruit from the repacking centers
in Hamburg and Bordeaux to nearby markets of couLrse only takes a feow
days.

SOfficial'and Semi-official Aids to Marketing Competitive Fruits

Most of the foreign dried producing areas have been favored at some
time or other in recent years with some form of official or scrii-official
assistance. ThisAs particularly true of Yugoslavia, Australia, Greece,
Snurnt a and Spain. Most of the agencies sot up in those countries for
the development of their dried fruit industries and for the expansion of
their export markets arc still in operation. In Smyrna a special raisAn
exchange was established to facilitate the sC.ls of r.isins. In the
Zlagq raisin producing arca of Spain a special board was sct up to
grade ancd classify fruit intended for export ind to takeJ stops to promote
sales ir. foreign markets. In Australia, the Commonwoalth Driqd Fruit
Export Control Board was created to effect th. systematic marketing of
the dried- fruit crops. In England, the British Empire "c.rkcting Board
is doing everything possible to promotEW the sale- of renpire-grown fruits.

In Yugoslavia the Government is vigorously encouraging prune growers
to adopt more modern methods of production and drying. Special demonstra-
tion centers have boon established and state nurseries furnish new stock
practically free of charge. In Greece the important currant industry is
controlled by the Greek Currant Office which rcgula-tcs the movement of
supplies. The poorer grades of currants arc not llowcd to leave the
country but arc worked up into by-products. Low prices on competing rai-
sins comparable to Greek currants and used for the sane purpose have
caused a decline in Gruok currant exports in recent years. The syndicate
has attumptod to counteract this decline by using more of the fruit in
the by-products industries. Higher.future vclucs on raisins arc expected
to correct this situation as Greek currants arc well liked in Europe. A
commercial treaty with England provides for -. definite tonnage of Greek
currants to bo ioprted into that market each year.

Effect of Tariff and Other 'RLgulations on Dec.and

The trade in Europe generally is of the opinion that
tariffs on dried fruit in various countries have had little effect on
imports and consumption because of tho rcl-tivoly low prices that have


-9-







prevailed on dried fruit in rocent yc.rs. It is nidmittod, however, that
prevailing tariffs 7aould 'hav: had a &otcrring cffoct on dmeiand if initial
values had bscn higher than thc:/ wore. The United Stateos in most cases iM"E
arssured equality of trLc.tUnnt whenever special.tariff concessions Tro ali."&
by one European country to another by rcasn of the "'most favored nation ,
clause" in our conmc;rcia.l treaties with most of thu Europcan countries.
The recippocal corac.-rcial treaties between Yugoslavia and other European .
nations have initiated a r.cll defined tendency to lover import duties on *
prunes in mniost of the l1,.rgc consuming rma.rkets. The most important of thce.e :
arc the agrooicnts with GCr.ny, Austria, and Italy, rhich show a material
reduction end, in the case of Austria, have boon entirely removed on pruOes,
in bags. There is r. tendency ir- the Scandinavianm countries to lowxor the .I
duty on dried fruits, the Swcdish parlia-cnt alrcaay having removed all '
tariff barriers to the inportc.tion of prunes. Franco materially increased. ..
her duty on prunLs ir, 1927 order to encourage the local prune industry, but '
no significant increase in ne" paintings is apac.ront as yet. The loaders .
in the French prune packing industry are opposed to this tariff increase .
since the industry has to drnaw upon the Pacific Coast for unprocessed prunes.
Great Britain has imposed tOrifi'fs oL Cl dried fruits c.nd has given products
from products from Emrpir. sources of supFly preferential treatment. Tho
Empire countries as yet produce no appreciable amount of prunes but in rai- A^
sins and dried apricots the Pacific Coast is placod at a distinct disadvantage
by reason of the British preferences or shipments fran Austrac.lica and South
Africa.

The CGovecrnimennt of Foland mr.int.ins a rathn"r unique system, knom as ,
' contingents ;hcrcb" cort'.in goods can be imported only upon permits is-
sued by the Mlinistry of industry -',id Co--ricrec. Such perm..its must be renewed
every thrie months and arc issued only to Polish importers r ho pay taxes and
carry or. business under r-gistcrcd Polish trr.du licenses. The idea of the
system is to establish basis for bargaining in cormnnection with reciprocal
comncrcial oagrocmcrents bLt7cn 'oland r-.d the neighboring countries of
Czechoslovakia, Hungary and Austria. The .:no.ct contingents" allov.-od various
foreign countries for the inrortcation of prun cs are not nm.de public by
Poland but it is wvcll knot.m that the perits for imports from the United
St-'tcs in recent ycars have ,cen fl r bclo:- the "contingrents" allowed such
nonproducing but rclatively irrmortant prune packing countries as Czechoslovakia,
Hung-iry a.nd -.ustriz. Th. i:-ncdiat *:-ffrct h-.s beenr the development of the
prui-r packing industry in] theso la.ttor countries arnd increased imports of
processed pu'ncs by Polni:c f,'ra. those centers. It is the opiL:ion of the
tr'-.ec in Pcl- n2 thu'.t the ,.extra c rOnsL cvt.taileod b: this procedure amounts to
at least 9'C rcr cont.

Socron-l Cha'c-.ctertstics of th D-L-ied Fruit Trac.c.

G-r. orally speaking, th. cornsurption of dried fruits in Eu-roe) is highly
seasonal. ost of the supplies of cheap locl1 fruits havc discppearcd by
the Chiriotr.s holidays, .ni1 it is imncr;.tio-,: thl.t nevi crcp dried fruits be
av.-il.bl ii, thy r.tzil char-,cls at that tine. To "ccomplish this shipments
should not arrive latur than the middle tc th.e l1.-.st of Novonbcr. Failure in
this resmct maans the loss of the most irmorta.nt consuming pe-riod in Europe.

10 -






.. ""* _-J..











Ena xLporbang. .unrLus ;ui.z iinu3.L3ouy g aurji.Tur uj.rjy 1.5
lotdr rmzo. why. c.rly- shipments should be rushed to Europe. Some markets,
0='-tiaulirly thu Soandin.viar coantrirsa buy practically all of their rc-
l:.^c&bs oarly. .ith-r districts purchasc.fra 50 to.75 per cent of their
y:: .rl...irc urncnt. orly, djcpcnding4 upon prices x.d.general conditions. There
or' b 'indifations, ho-e.v'r, that dried..fruits arco.bocoming loss seasonal in
COIL :toaBi ton; .. The European pruc. packers, for oxamnlo, Lvr.int-.in that the
I:'illability of thcir-froshly packed, stock hcs definitely increased the
S... ar-round duImd"d'for- prunes,

*. GcnaumzPr.Prtfcroncc and Buying Clharactoristics

i On oof. the essential- requisites to the-.successful marketing of .dried
i 'ruit in Europe is at. undcrtacviding of the consuiMer proferonccs and buying
fleanctorlstics. This.cclls for-accurate lkro-jledgo of consumers' preferences
i as to bulk ,md packaged fruit, cnnsunc.rs' rcacticr. to brands, frequency and
IH, -:iAzo of retail sales, corn.sumors' ideas ns to food values in dried fruit,
w proforcncbs as to sizes, cooking.practiccs nsid rnys ir.rhich dried fruits are
*. *used, randl'nt, but.not leost, the price of dried fruits corpnrod n-ith fresh
i. fruit or other foodstuffs. Amcrican- shippers of dried fruit must hn.ve reliable
in. formation along all'of those lines- in order to develop the various markets
ii officicntly.

Attitude To'ard Dried Fruit in Cartons

Generally speaking, Europu docs not t.-.kc kindly to dried fruits in sealed
P, cartons. The" only exceptioni found in this respect is ir thno case of carton
.rlislns in Er~land and the Scondircvirn countries. An exceptionally lov price
'" .Aling ofn' this frtit, continuous advertisin-:, :nd uniforn quality hr.vc broken
do wn .the oncnccntura]. antipathy in thosqbiarkcts this innovation in larkcting
as far as raisins arc concerned. Euroerarn pruno packing centers, however, have
found carton packing a financial burden because of small repct orders and
the consequent high cost of packing. A second objection to dried fruit irn
cartons is that tho ruropcan housewife nrzefcrs to buy on "eight". I:er shop -
ping program involves an inspuctirn of the fruit and the price tag. Thus
equipped, shc judges values for herself. Naturally the appc"rancc of the
fruit rather than thd container'plays the most i.o rtant part in sales appeal.

Europcan housewives buy sparingly as a matter of necessity and alr:ays with
an eye to fo6d value received. To the average houscruife's slender purse and
frugal mind the sor.lo., cartonr. presents xan added cest to be paid for by her.
.. This, of courso, dcos not hold true for the more prosperous class of buyers
but the bulk of the dried fruits, prunes particularly, is ccnsunod by the
laboring cla.sscs -rd l-oi-incomc f-amilics. This partly oxplir-s vrhy Europe is
Called a pricee -xnrkcte It also explUir.s the' "clasticity'- of European markets
L .for prunes, s indicated by its ability to consume apparently unlimited carry-
overs and record crops when prices arL lo7 and withiL the reach of the mil-
lions of consumers.


- 11 -










Month : Pears

1927-28: Pound
July L i
Aug. : j
Sept.:
Oct. : /
Nov. :
Dec. : i
Jan. :
Feb. :
Mar. :
Apr. :
May : A
June
Total

1928-29:
July :
Aug. :
Sept.: I
Oct. :
Nov. : /
Dec. : i
Jan. : 535
Feb. : 820,
Mar. : 521,d
Apr. : 546,1
May : 158,1
June : 42.


Total

1929-30:
July
Aug.
Sept.:
Oct.
Nov.
Dec.
Jan.
Feb.
Mar.
Apr.
May
June


: Raisins


8


Pounds
8,172,110:
9,906,078:
9,007,733:
45,472,032:
33,158,587:
21,369,417:
14,234,079:
11,365,670:
13,311,577:
8,245,220:
7,894,209:
10,981,805:


* 6


:Arple : Peaches n nes
: Apples. : Apricots ; Peaches : Primes


C C
Pounds : Pounds :
583,913: 478 077:
2131384: 5,799 475:
568,071: 5,66, 303:
2,839,146: 2,549 065:
6,378,382: 1,576 864:
5,327,375: 1,505,841:
2.602,894: 1,351,756:
1,248,057: 1,199,859:
941,307: 940,652:
448,293: 976, 546:
459,023: 657, 242:
94,640: 982,588:


:193.098.517:21.704.485:23.684.268:


919:
374:
r22:
261:
350:
548:


11,356,232: 143,599:
11,777,695: 1,064,822
20,485,368: 1,692,4O:
66,300,365: 5,884,001:
32,990,268: 9,737,405:
17,547,246:10,769,893:
13,229,283: 7,822,681:
11 ,414,045: 5,575,186:
7,530,518: 3,642,353:
6,827,173: 2,215,544:
8,391,503: 1;232,423:
13,905,820: 24.3,798:


1,650,806:
6,662,889:
3,469,861:
2,959,990:
1,639,062:
1 352,231:
1 142,694:
1 330,917:
1 627,421:
1 975,789:
545,044:
295,224:


Pounds
150,579:
259,396:
536,507i
1,500,1286:
1,055,891:
642,581:
607,783:
546,307:
309,281:
417,644:
289,172:
226,825:


Pounds : ...
5 170119
4, 986,5325:; f
5,877,050:..
49 615,263: '"4@9
60,706,727:3,14mi0
35 097,400:2,05w,1
28 6000,351:2,96$
27,020,529:1,497%,4
16,.443,1-08: 84AA
9,720,930: 51i6
7,223,836: 4A21
10,1689,863: 5


6.542.092:260'.,624,501:1


123,331:
331,637.
2,033,479:
2,752,313:
1,172,143:
1,000,348:
934,414:
1,106,115:
1,204,311:
959,268:
464,497:
354,137:


.. 'A. 19

7,726,813: 17Z 5G0
8,655,505: 341i.,VU-:::::ai
10,014,668: -8'S4O '
77,166,358:8,555,94.2 !
37,042,715:4,000,591:;
27,923,114:1,721,:8g.::
23,629,274:1,81,9400 ::
22,999,073:1,05,g9.. :I
19,598,097: 674,854 i'
19,858,055: 676,987 .
10,606,011: 531,017.
7,831,143: 7660


i/ :221.755.516:50.024.165:24.651.928:12.435.993:273,050,826:20803,58S


48,957:
134,802:
118,120:
742,326:
399,912:
510,767
412,457:
249,165:
565,247:
166,286:
140,573:
171.046:


9,490,681:
12,190,219:
16,912,034:
27,681,491:
14,185,667:
7,929,0353:
4,712,588:
4,108,0814:
5,692,156:
7,463,209:
7,744,450:
10.476.652:


.14,049:
115,013:
2491551:
4,086., 317:
8,264,533:
4,397,739:
2,777,452:
1,428,4'22:
682,945:
4 .,938:
781,079:
517,279:


322,240:
3,926,813:
4,897,079:
2,265,615:
1,350,108:
1,585,632:
1,332,632:
735,503:
555,405:
579,230:
891,594:
659.0863:


135,735:
249,572:
8371572:
796,729:
375,240:
368,307:
217,173:
215, 308:
239,532:
112,548:
145,925:
150.211:


4,563,722:
8,255,014:
5,375,624:
24,699,799:5
30,894,554:
18,919,217:
12,504,433:
9,605,856:
6,020,476:
4,793,184:
8,736,201:
8.622.945:


164, 304
872,277
728,689
,403,059
807,116
618,024
885,443
726,506
506.076
475,853
357,871
124,165


- 12 -


Total :3,659,658:1.28,585,456:23,79,317: 19,100,934: 3,8.,852:12,989,025:11669,383.
Compiled from official records of the Bureau of Foreign and Domestic Commerce.
ij/ Included in -'Other Dried Fru.it.'


k" "


S


D


.me..


f jr -


- i _














o prune in Sweden showed a gradually growing interest until advertis-
unds were withdrawn which killed all interest in the carton pack. If
attemptss to introduce the carton prune are made, it would be well to limit
*Iefforts for the tire being to those-countries that have accepted the carton
f$S^in and undoubtedly the best response would come from the cooperative
'tying| societies.

*": Dried fruit in Europe has to be openly displayed to permit its ap-
;",;v -pestlaing appearance to act as a sales aid. Since actual sight of the
; goods is such an essential factor in sales appeal, it would seem that tho
ai, transparent cellophane package should bodecome popular in Luropean markets.
.... are Visibility is so desirable in emphasizing quality, the cellophane
c"p." caught to be acceptable since it not only permits actual sight of the
S goods but in- addition protects the product from dust and generally keeps
I it inna sanitary condition. It provides the answer to requirements for
.' an attractive, convenient, sanitary, identified package that can be dis-
played :on open stands where "sooeeing what you buy' is the watchword in
constumor purchases. The mm.in objection to the cellophane pack in Europe
S would undoubtedly be 'price'". Some progress has booeen made with the collo-
pb hane package in both Hamburg and Zurich but only for the finest quality
-and grades purchased by the better trade.

Consumer Preferences as to'Types and Sizes of Prunes.

i: The three principal types of prunes sold in the European market are
Sthe California, the Yugoslav and the Pacific Northwest. Each type has
i*, distinct characteristics but in most markets the price of the fruit is of
S more imaportracc than the type. The Luropean market in general scons to be
S partial to the California prune. This preference, however, is more the
result of a trade preference due to the steady supplies of good quality
fruit than to an actual consumer demand. The tart Pacific Northwest prune
can be sold in most markets only on price concessions in comparison with
California fruit. The Yugoslav prune from the standpoint of acidity falls
somewhere between the California and the Pacific Plorthr.cst prune. It is
not as sweet as the California prune nor as t..rt as the Oregon variety.
The heavy crop losses and the inferior quality of the Yugoslav prane in
most of the recent years has left a definite place for the Pacific Northrcst
prune in most of the European m..rkets, particularly in filling the dearrnd for .
the larger sizes absent from the Balkan countries.

It has boon suggested in the United Statos that r.ll prunes smnllcr
S than ninety to the pound should be withdrawn from domestic tradc channels
S as a mxasurc to protect the lzrgdr and better fruit. It is contended that
small prunes arc not profitable to the grower r.nd that their elimination
would create a correspondingly larger dcr-mand for the better fruit. Whether


- 13 -







small prunes arc profitable, of. course, is very largely a mtter for tiJ::i
individual grower to decide. It is possible thbt our osw. domeosticL mark4:f
would respond in buyir.g more of the bettor fruit wore the snr-ll sizes
eliminated. The sivll sizes, howov.cr,' find their main outlet in the 0'
markets and to that extent do- not interfere in the domestic oorLsUmMOV,''z.^^
demo.nd. From the virewpoint of the oixport tradc, thercforc, the quostionA'IM.4
of thu elimination of the snrxller sizes presents Pn entirely different.Ji.
aspect. '
I.
..: ... ... "..~

European Demand for Prmnos Arn Largely For Smaller Sizes eio :i||i

Unquestionably there is a real need and demand for small cnd rolcti...'iti
ly cheoap prunes in Europe. The very sn-.ll sizdt have in the past boen i
supplied mainly 5y Yugoslavia, but owing to inferior quality in recent ,
years as roll cs to the shortage in supplies fran that country, there ha ,:.
been an increasing sale of the 1-rgor sized prunes from the Pacific Coaa: :'iI
From the earliest days of the dried fruit industry Europe hn.s boon ac- ,i
custoricd to sEn.ll prunes. In fact, prior to the development of the in- "i
dustry on the Pacific Coast, practically all of the prunes available w17Ot-::,.
of thu sr.ll sizes. .s ta result, consuming habits and. mcthods of prepcr .- 3Mi; i
tion have developed on the basis of the sm,.ller fruit. The widc use of .
pruncs in sn'ecil prairie dishes and in various fixtures of dried fruits in:...|
Germany, Hollcnd, Finland and in the Scandinavian countries, favors the ,'
usu of the s..ll.r sized prunes. In f.cA, cithor raisins or the small .
sized prun-s arc used for this purpose. -

Another re'.son for the popular dcm-nd for small prunes in Europe is .r
the fact thit a. co:apnarativcly small purchase, must often satisfy c. great ..::
many mouths .nd c larger number of pi.ccs p-r pound nrmcs a bettor showi.s .i
Somewhat th. s-ne principle is involved in the European dcrr.nd for the io
smaller sizes in a--,ics. It is doubtful, therefore, if the elimination of :
.... f ..*:"
the semalltrun.e oul!- incr,.ease the dc:a.nnd for the larger fruit in Europe, .
Aside fraa the feelings thit sm-.ll fruit is not inferior but even preferable, ..
the economic situr-tion in l;rgc areas of Europe is such that many consumers
would go withoutt dried prunes and other dried frait rather tha.n pay the .
enhanccd price for the l.rrer &izcs. :

EliruintinC .he small sizes in American shipments .:oul only cncourrgo
the incr.rcscd production of the smaller sizes in the potential prune pro-
ducin; sccctions of Europo. During the 1928-29 season, scnu of the principal
mnark,.tc in northern Europe .erer calling upon southern France for small
fruit rhc'n Pv.cific Coast supplies of this t up :ere scarce a-nd relatively .,
high. The rcl:tively cheo.-p Pacific Coast prunLs ..n:j raisins available in
Eurrop,% 1: recent yr.rs have served :.-.s a check on production and expansion
in co.ipctiJ-.r areas but a total absence of snma.ll fruit from the United
States would undoubtedly be an incentive for expansion in the potentially
co-pe titivo arca-.e




14 -













plies fnom that country in recent years. however, together with the in-
Sferior quality and relatively high price of the fruit compared with the
abundant supplies of excellent quality fruit from the Pacific Coast at
relatively cheap prices even in the larger sizes, has caused an increase
t-. the demand in practically allof the markets of continental Europe for
the larger Sizes from the United. States. It is commonly admitted, however,
that many European consumers aLe favorably disposed to the small, tart
prune from Yogoslavia and many dealers there are of the opinion that the
consuming public would readily give preference to. prunes from that country
if they could be delivered in adeq qate quantity in good quality and at
their one-time relatively cheap price. In general it can be said that the
various European markets differ as to size preference but that there is
now a growing tendency towards the medium and larger sizes. The latter
tendency is not due to any educational campaign but rather to the relative-
ly low prices at which even the larger fruit has been sold in recent years.
It seems reasonable t. assume that the tendency will continue, particularly
in countries where economic conditions are improving.

The demand for 4merican primes in France is mostly for the sizes 40/50,
50/60, 60/70, and 70/80 although in the Oregon varieties the larger sizes
S such as 3O/401s may be included. In general the larger sizes are too ex-
pensive while the extremely small sizes from the United States are thought
to have too much pit in relation to flesh. One of the larger cooperative
agencies in France demands that 75 per cent of its prune purchases be of
the 50/60 size. Germany, before and shortly after the war consumed prin-
cipally small prunes 70/80's and smaller but during the past three or
four years the trend has been toward sizes 40/50's ani 60/70's because of
the abundant sup jlies and relatively cheap prices ruling on the larger
sizes from the United States compared with the continued shortage and
relatively high prices of the formerly popular small sizes from Yugoslavia.
The 2erman trade does not care to accept this tendency as permanent since
the Yugoslav prune is well liked and it is believed that with adequate sup-
plies of good quality fruit, once more available from that country, the
market will again turn to the Yugoslav. product.

Switzerland has been purchasing mainly the 60/70, 70/75, and 80/85
sizes in prunes. The demand for the very large sizes is limited. Some
complaint is registered in Switzerland because of the fact that our prunes
are classed as 70/80's, for example, when the count is around 79. This
complaint no doubt irises from the fact that Yugoslavia designates the 70
size by the term 70/75. The next sizes in demand are the 95/100's and the
-10O/1lO's. Belgi consumes mostly the 40/50 and 50/60 sizes in prunes.
i The smaller sizes from Yugoslavia were very popular formerly but in recent
grpears the demand for those prunes has been greatly restricted. Belgium
Snow prefers the California prunes. Prunes from Oregon are purchased only


- 15 -







when the difference in price is ap?reciable Size demand in.7he ethera
runs as follows and in the order named-: ... 40/61'b,- 70/801s, 50/60', 90.
30/40's and 80/90's. The natural demand is for theqweeter "Santa Clara"
prune. The sale: of Pacific Northwest"prunes is a matter of price, the. 3
size being wanted especially when cheaper than California gaodd.

In enmark the sizes 30/40b' and 60/70' s are generally called for' :
The vertsmall aizes in the past were obtained' from Yugoslavia but with'
the relatively low prices ruling on all prunes in recent 'years the denma:4 ',
for the larger sizes has been increasing. In Nrw the'greatest demand '.f
is for the 40/50 and the 60/70 size although 30/40's are in demand by ".
the wealthier classes., In the 30/40 and 40/50 sizes "Santa Clara" puimep .,,
are desired bout in 60/701 s the "California Outside" may be& sold. For ..Ib
country trade the 70/80's and possibly the 80/90's are suitable but
seldom smaller. The demand in Sweden is mainly for the sizes 40/50's and w
50/60's,with aome call for 30/40's. These sizes are used largely in the
cities. For the country trade 80/900's to 90/100's are wanted. In Finla d !,
the city trade requires the sizqs 20/30's to 50/60's. For the country trade a =
the small sizes 90/100's to 120( over are demanded especially in mixtures,. 5 .
== i
Selling Prunes as Large Miedium and Small.

Trade sentiment in Europe is opposed to any change from the present
grading and packing on the nine or ten point to the more elastic basis of
large r.edium and s-all, even though the European housewife does not buy
prunes by exact count but rather along the broad lines of large, medium
and small. If any attempts were made to change from our present system of
grading a clear and definite understanding of what was meant in each case
would be expected. Under the present plan the imrporter knows exactly what
he is buying and being accustomed ti these standards it would be difficult
to change his point ;f view. Ih so-..e f the European prune' packing centers
the exact ciunt, as understood in the Pacific Coast is not followed and
according ti retailers' needs and pumse the count nay break ali.jst anywhere,
In general, however it miiht be sail that prune standards as to size'have
not been set by growers or by consumers but by the trade practices of many
years. The present size gradings are well established in the European im-
port trade and any change would be unwelcwnie.

Mixed Dried Fruits Popular in Many Markets

Many of the dried fruit markets of Continental Europe show a good
demp.nd for dried .. fruit mixtures. This is particularly true of Germany,
the Scandinavian countries and Finlani. In France and Belgium, however,
dried fruit ;Axtures are unpopular and are hardly ever to be seen in the"
retail stores. French buyers lok upon such mixtures as remnants of various
dried fruits, while the French cojks -aintain that mixtures cannot be made
up into satisfactory diishes, since each fruit requires special treatmpnt.
Mixed dried fruits on the other hani are very.popular in Germany, and
retailers there report greater -sales of prunes in this.form than separately.
Prunes used in such r.ixtures in Germany are usually of the small sizes, and
the prices )f the mixtures as a rule increase as the prune percentage declines.

-16 -





















-, .p '4Jpraximately 50 per-cent of. the prunes, i,,poted into Finland arqm sold
t. a. consumers in the. for. of mixtures With .other dried fruit. These mix-
W! ies cansist mostly of prunes, raisins and .apples. -with smaller quantities
o::: f apricots ani pears. Peaches may occasionally. replace pears if prices
Are low. Owing to a lower duty on prunes, the mixing. of dried fruits for
the Finland trade is dane mainly by local importers. Unprocessed bag
prines from California are used for this purpose. .but if prices are high,
the smaller sizes from the Pacific N.wr.thwesat ar.:e used.

Fruit Advertising in Europe.

Cansuners in all parts of Europe buy mainly on the strength of indivi-
Sdual judgment as to the quality of the fruit. In other words; the actual
i. ght of the goads is the strangest sales factor rather than any printed
.statement as to its excellence. Under the prevailing characteristics of
consumer buying in Europe, it is evident that dried fruits must be prominently
displayed. -In- the better and medium, class stores these. displays are often
very effective. The -newedr department stores in the larger cities, with
their :separate'department devoted to dried fruit, usually present an appetiz-
ing-iisplay. of these products. The .fruit is luaped out .on counters in
-i.. nedtlyarransed,.piles and always :with prominently displayed price tags.
This in..itself-is effective advertising. ; Continual national advertising,
however-. w.ul. uidjubtedly -have .favorab e results in stimulating the demand
for dried.fruits 1in cartons. .
.. .
A 'great deal o.f publicity in behalf .of.fresh fruit is being carried
.on in luropean.markets. -Europe has been..extremely health-minied since the
war and prnpaganda:.for increasing the ciansumption of fresh fruit has had
-*n. important-part in this .movement. In Germany-six distinct fresh fruit
adverti-sing. caupai-gqs have been under way in recent years. This work is
being sponsored by such private concerns as the:banana .interests,. by com-
bined efforts of auction houses or trade factors, or through more or less
direct Goyernmentt. ai.an:jdirectijn.- The 3enrman trade is unan.imus in
the opinion-that public-ity and education have greatly stimulated interest
S in fresh...frufts; ..-Similar campaigns have .been .inaugurated in the
Scandi..aTia. .cauntries... .. .
..' "


- 17-





The British "Eat More Fruit" campaign is said by authorities t 'i
have increased fresh.:1,rit' demand in that country, by 35 per cent ,uii|
the past three years, This..camptign is supported joint 'by* shipper. L
and brokers whd in taura xa wns. the supoOrt of thousands qf retail'isl....
Empire dried fruits are being.eztensively advertised in #-reat Brit1A:a :lll'
Through the Empire Marketing Board not only to increase cansumption
but to :creqate.a preference for Empire products. The Greek Currant .
Syndicate, a semi-3overnnent. and semi-industry organization, isdoing
effective publicity work in -behalf of areek currants. ', ,
xjH
'Trade circles in Europe generally:'fav or similar advertising-8
on dripd fruits, Such efforts must., be-, educational in character, with|.:
cular emphasis on the health'. ad relative tood. value features. One. A :r i...
Pacific Coast cooperative has done very effective trade'promotion' wort '..,:
raisins ini several of. the Europeam-markets -particularly Engln4 and
Scandinavian countries. While this.was brand advertising, thIe r'ult I.:4
have been most gratifying and are conclusive evidence of thee.psl+bA|^^,
in expanding the demand for American dried fruits. The tr"de =pgenp
is of' -the opinion that any dried fruit advertising campaign 'should e
industry rather than a "brand" affair and in order'to be successful it' .....
must command the united action- on the.part of the industry -on the P atal4..0 .
Coast. Small independent factors would make little progress in the f ,,'.,'.....
of the united action on the part of our competitors. '. ... :...........
.. .. .. ..
Sales Practices and Marketing Developments '"...

Fiixing Opering Prices .... .:::. :
H .. :EE. .
American quotations on dried fruits in recent.years have shown a t. 40#Ii'ta
cy to decline seriously as soon as European buyers have mad' their early:.
purchases. This practice has caused mat.erial losses to. those who pur- .":.. .:: :!
chased early. Many dealers .Jn the European market are positive that o.... :fii
early price quotations are often made without regard to .the world factor;: *I'
that bear upon a proper price- level. Pronounced objection is made to thee":: ..
practice of naming opening prices on dried fruits so .high as to be cOmp-l.lir -el. "!
out of line with later developmentss. Individual losses subsequently in ': ,.
curred antagonize the trade and discourage .volume buying. This practice -..
is especially reprehensible in years of heavy dried fruit crops when the.:.
cooperation of every factor in the trade is necessary to move large tonnage ..
into c'onsuistion, Specifically, the European trade charges that the
Pacific Coast operators either have little knowledge of world factors which
determine a proper price level, or.that facts as'to production and carry--:
overs are deliberately mis-stated. Unfortunately the latter belief. s very
pronodunced and is '.responsible for much of the present irritation towards
the Pacific Coast unifo.rm.dried fruit contract,

While there is wide. objection in the European dried fruit trade to
price cutting the trade.doeas:not favor a- "strictly uniform, price policy".
It is felt that such a:pdlicy would deaden individual initiative and pur-
chasing aoility and would probably eliminate alAnteres't in the.part of
the trade. For that reason the..trade favors price variations within


-. 18 -
















1 i ~ r ,* re. : "" ....
~p .n prices are better k11o W.

SOpening prices that allow 'ofusne ,rbfit on "early purchases lead to
.lume buying and present an opportunity for the speedy cearance of the
....ason's supplies. Heavy losses in early purchases on the other hand lead
:":" indifference which is highly detrimental to vilune buying. To the
M erican industry this means pric@ cutting in order to renew lost interest.
sharply declining markets however, retard the miyeirent of supplies
into coansumntin md result in vexing carryovers which adversely affect
prices on future craoss Euroean dealers feel that there is a proper price
::: range fir every year's crop and that the. best results generally would be
S secure if opening prices were in line or slightly'below that level so
2 .that-impetus in-buying, ..fJstered by reasonable profits would enable the
I entire crop to be consumed and the zarketk, clase at well above the open-
S ing level. While such an opening price level might or might not be
*l profitable in the last analysis it w.juld be justified by world conditions.

1 It is "possible,. -of course, tj naime prices unjustifiably low as was
t : he case in 1928, While Calif jrriia that year was faced with a large crop
Sof both fresh and dried fruits when'.early prices were'named, no consider-
i atiin was given tUthe prune crap situati-n'in Oregin, n.r to the results
: of insect ravages in the Yugoslav orchards, which reduced that country's
crop by fully fifty per cent. The Eurjpean packing centers were the first
to realize the full significance of prospects for a very light crop of
local fruits in Europe that year. The crip year 1926 again illustrates a
situation-when our opening prices were far out of "line with actual condi-
tions. All fruit production that year was at a iaxwixu and the enormous
aggregate total could not be consumed excet at relatively low prices.
The dried fruit industry that year received a severe blow and large quanti-
ties were carried over into 1927. More reliable and comprehensive crop
and, market information is urgently needed in order to give growers and
shippers a reasonably accurate basis for determining opening prices. Such
information must be available tb American Shippers throughout the entire
season in order that prices pan be maintained at levels consistent with
the world supply and demand situation.

Eartort Procedure in Handling Dried Fruits

S. ales of dried fruits from the Pacific Coast are controlled by voluntary
action of the California ani Pacific Northwest Dried Fruit Associations.
These trade associations are made up of actual packers in the industry.
| Comparatively recent development is the organization of the California
S and Pacific Northwest Dried Fruit Ex.ort Associations which admit to mem-
ership the dried fruit exporter as well as the packer. Organized under


- 19 -








the Webb Act, which .exempts export operation frax the restrictidaonn :!
Sherman Anti-Trust law, these organizations have' the power to' cbmbnio&
terests for varies pur-oses including e port price stabilization.' `Sf
their efforts have, been confined mainly td the adoption of more unifOfi....
contract regulations ..and placing aldefinite check on consignments.' Tunr
primary object andi-function of these trade asisosiat-ions is to establi.4i:tw ib
a uniform. trading basis as it affects contractual- relationship betweent.O........,
buyer and seller; to impose rules and regulatiansartaining to standatq:.'e :
and quality, azi to maintain an. inspection service for the enactment :,
such standards as have been established.*
.....* :.... :*. :;
Practices of competing areas ....i
...--------. ,'. :: ... .. '* i"ii

The.Balkan countries sell their prunes on the oasis of payment'c:i!| ::. .... J
presentation of documents but ins-ection and-aibitration,- if any, are at'
points of destination. The Australian'Dried Fruit-Control Board has ...
agency in London that regulates the n-arketing of Australian dried fruit "l:
in the .British market. Dried fruits from several of the Mediterranean "::':1i
countries are consigned to a selected. and restricted group of importes..f .'
located in the principal ports. Sales of currants from Greece are direotS*1.G:L
by the Greek Currant Office, a semi-Government, semi-industry organiza tia. ':
with the main office in Athens and a branch-office in London. In some ...
countries on the Continent, Smyrna raisins are sold on sample. Russia ..8'
her fruits .through resident representatives of the Soviet .Government, who
in turn often eramloy a selected groua of agents. The -rune packing cents0". :
in Europe are not restricted by quality or selling regulations and may offer. :
credit terms far out of the ordinary. ,.
', :. ." ". :
American driel fruit associations develop uniform sales contract :::

Uniform contracts covering the sale of American dried fr&itdfor export :
have been developed by the American dried fruit associations in cooperation ":."
with the or~anizel. dried fruit trade located in the principal importing
countries. While, these contracts differ in detail for the various types.'
of dried fruit, the important features are uniform. Under its terms, the'
matter of insJection of the fruit before shipment is of great importance
as the certificate issued covering soundness gene-ral quality and count,.as
in the.case of ?runes is final. and is accepted oy the buyer as such.
Under the American contract arbitration is in the country of origin. The
seller is thus protected, should unavoidable conditions seriously interfere
with the exoecteil tonnage or quality.of tneshipments. It is in these
particulars c.ainly that the the Pacific Coast contract differs from that
usei by ciwpeting countries. American payment terms- are usually three
days' sizht upon arrival of documents. These documents include Ocean Bill
of Lading, W'eirht, Insurance and qualityy certificate Draft-Invoices'and
Consular certificates if required. WThere payments are in dollars,
as on the Continent, no discounts are allowed. In the case of England,
where payments are in English money, the discount is one per cent.'

Dried fruit, operators on the Pacific Coast are cautioned not 'to sup-
plement the present contract with special terms and conditions. In case of


- 20 -









.p' 5R UU jUULUU UAU4.4uZW CUJVU tL 6a ~ iUBJILH LJUNCU" JtUi ..LUUICuiLL I Jr bjICLaU.LUL FeiCL UM
^n.% anq inh4ication of the undesirability of the buyer or agent in the first
.$iltce.. :.Thi.s tendency is most pronounced in countries which have only
46 .. 4ntly been developed as dried fruit outlets.
||i/ 'J" :: J J" 's "v ;" : i ... '
r l"ied fruit inspection service a/

Practically all of the California dried fruits entering into the ex-
port trade are sold on contracts praviiing that the inspection certificate
of. the Driei Fruit Association of California ahalk be final and conclusive
.as to the .quality., ,rade, and condition of the 'fruits sold. A similar
itnspectiin. .service is operated by the Northwest Dried Fruit Association,
with offices in Portland, Oregjn, which serves the producers and shippers
of.dried fruits in-the States of Oregon and Washington. In the whole field
Off.commerce there is no better example of the value of a rigid and impartial
commodity inspection. Practically the entire American export commerce in
..-driei fruit passes through this inspection and tens of millions of dollars
of fruits are certified annually. This inspection service is operated under
the jurisdiction of the Dried Fruit Associations rmentioned. These Associa-
tions are n m-profit associations, having in their membership all packers
-whether they,,be private commercial enterprises, or grower-owned cooperatives.

The American dried fruit inspection service has been built upon the
philosophy, that it represents a protection to the buyer and that the buyers'
interests are the main responsibility of the service. The syetem is carried
out by means .of crews with a thoroughly qualified inspector heading each
crew. The..-crews consist of specialized laborers who open, recoop, and re-
strap all inspected parcels. Goods are not inspected until they have passed
from the.packer or seller into the hands of the transportation companies and
are, therefore on neutral ground. No effort is cared to preserve the
impartiality and efficiency of the inspection. The personnel of the inspec-
ti-m. force is very carefully chosen and trained so that only individuals of
demonstrated oonipetence and integrity are permitted tc serve on the staff.
A rigid system of discipline is employed to prevent error.. These inspec-
tim services have operated for many years and there is probably no other
single factor, aside from the excellent quality of the product, that has
done more to stabilize and develop the present large export trade in
American dried fruits.

Attitude of European trade toward unifirm- dried fruit contract

There has been. and still is some feeling in Europe that our uniform
dried fruit contract is too severe and that it has been deterring factor
in demand. It is pointed out that documents arrive fr-'rhree to four weeks
in advance of goods and that the buyer must pay interest charges from the
time the documents ar6 received until goods arrive. It is contended that

a/ Based on a statement supplied by Mr. DWi-ht K. Grady, Secretary of the
California Dried Fruit Association.


- 21 -







with inspection at source held ab finial., there is no' protection in caa:.|
rioration takes place during trans'.t.." Many of the Eurpean b-uyersa
that either the inspection certificate" should not be final' as to quati
that arbitration be held in the. couitr? .oT destination. Occasionally timv
idea is advanced that the use of the 'silty day' letter of credit should b
more universally adopted. It is claimed .that such action would not in
credit charges to shippers and that it would -lead -to -larger sales, .part,.fli&
larly if the additional safety on large purchases would justify a slight:":::1
reduction in price. .5'
i ,. ,,.,ii
While objections to. our uniform contract are heard quite generally, *
it is doubtful if the contract as at present applied is a deterrent to sales.oi
On the contrary there are good grounds for believing that it has been on.a
of the greatest of the-factors in building up confidence and a consequent'd-&
sire to purchase our fruits. One reason for this is that the contract
has replaced haphazard methods of buying by something which is uniform ,.
businesslike and reliable. The contract in practice has justified its#l .:,
because of the uniformly good quality of the fruit shipped under it, Witlb-
out exception, the quality of our prunes is considered excellent throuagbt
out Europe. A majority of the more responsible buyers in Europe believe '-A.
that this c.mtract in itself, is their greatest safeguard as it places the, '
full responsibility upon the Pacific Coast. They realize that such a 4on-
tract could not be maintained except as it justified itself in results.

The Pacific Coast dried fruit industry from grower to packer and the
inspection service must cooperate in maintaining ouvpresent high standards
of quality. All matters pertaining to shipping and storage must be given con-
sideratijn, particularly in shipments to the Mediterranean areas and in
shipments going forward during the warmer seaJson. Educational efforts to
acquaint .the trade in Europe with American methods and thoroughness of
inspection would have gJod results. Much cjnfusi~n now arises due to the
fact that the crops are not 'of uniform quality from year to year while
our contract definitely states that the quality shall be "better than ar
average for the season".' If leading buyers or their representatives could
personally visit inspection points, much of this confusion and consequent
objection to.our uniform contract wnuld disappear.

When we consider that practically every competing nation is trying to
arrive at uniform quality and uniform sales practices and not always with
complete success, even with Sjvernment aid, it is to the great credit of"
the Pacific Coast dried fruit industry that through voluntary, self-imposed
action, both quality and practices have been brought to such a high standard.
COoperation between leading steamship companies and trade associations has
reduced the stowage and ventilation of dried fruits to a fine art, so that
they can now be delivered throughout the year in generally good condition
in spite of the extremes of temperature encountered.


- 22 -














pyeravlime uuIe Un ur 1"er 1 reuuc. urIs u V;y a miniaum, in genera- mne ira-ue
Iporacticus are .: of long standing and the contracts are definite and uniform.
V Continental European countries pay in dollars and use the metric system of
weight, the unit of sale being 50 kilos or 110 pounds, Sales to the British
: market are made, on the basis of. the humired. w.6A of 112 pounds and in
shillings and pence. It is necessary, therefore, in making quotations
on dried fruits to convert the Aimerican' terms 3f weight to the terms used
i: in foreign countries.. Dried fruits' are generally sold c.i.f., which means
:, that all casts up t, the time the fruit Is deliveredd in the European base
posts are included in the price quoted to 'tba't pr`t.

FI r the ports of continental Europe.........

The handling costs on prunes fromr the packing plants the Willamette
Valley Oregon, to European base ports amount to $1.03 per 100 pounds gross
Weight. In making c.i.f. quotations on dried fruit to continental European
base pirta, these costs are merely converted to their gross weight -
equivaleht in kilos. The result is then added t) the original price f.a.b.
packing plant. For example, on two bundles. of prunes weighing 124 pounds
gross (i.e. four boxes strapped two boxes to a bundle with each- box contain-
ing 12i kilos or 27,5 pounds net) the handling charges would amount to $1.28.
WIth prunes valued at 6 cents per pound f. j.b. packing plant the c.i.f.
quotation wjuld amount/to $6.60 plus the "sales differential" of $1.28,
making a total of $7.88.

The steps in figuring the above c.i.f, quotations on various packs of
American .?runes are given in the following tabulations. While the price
listed for the fruit is ai arbitrary one and the charges given apply only
to shipments frdm Portland, Oregon, the deataill serve to illustrate and
explain the procedure followed.













a/ Based on information supplied by Mr, C. A. C. Hansen, Traffic Manager
for the North Pacific Cooperative Prune Exchange, Portland, Oregon.


- 23 -







PRUNEd: H1.dllng cd ht, for. packin; plants located in the.
Willsaette tlley oregon, to. 'uopean .base port .;;ii


Expense items


v. Chardes per 100 'pds Ij
S.~.gross weift ......
:iPruires in Boxes:Prunes in Bacs a-


I

Inland freight (from plant to dock in
Portland, Oregon) ........ ............ ..
Dock charge (wharfage sad unlxading)....
Ocean freight (common stowage)..........:
Strappinz (3 cents per bundle).......... :
Marine insurance" (average).............0.:
Inspection at dock..... ................. :
Miscellaneous erxense's. .. .........:
Total ......... ... .. .......... :


SDollars


0.125
0,035
0.0.35
0.750
*.050
0.045
0.030
0.005
1.030


: Dollars
___"__IIIIII______"


U"
U

S


0.125
0.035
0.750


0.045
0.032

0.985


:........... .i
PRUNES: Net 'and- gross weight equivalents of various packs A3
and handling charges. "

:Handling cha r
Net Weight Gross Weight :ges at $1.0 .
Description of Pack : :per 100 lbs,.*
:gross f'or. boza&
: ___:and $0.985 per
Per box Bundle&Per box :Bundle:100 lbs, groar :i
__________:for bag Dru es::
: :: :
BOXED PRUNES : Pojnds :Pounds : Pounds :Pounds: Dollars
When packei 12U- kilos: ,
When packed 12i kilos :i3


(27.5 ibs) net to the box :
(four boxes strapped two :
boxes to a bundle) .......:
When packed 25 kilos
(55 lbs.) net to the box
(two boxes sin-le strapped:
with two wires)......... :


27.5 :



55.0 :


BAG PRUNES

Bags containing 50 kilos
(110 lbs.) gross.......... 110


i1o



110
SI


ii6


31



61


pounds gross for net


- 24 -


124:



122:


1.3772



1. 3566


1.0835










Jn,:"' -.Price f b'.ib. -plant in Potiand plus'handling : Quotation c.i.f.
L::. --chares-a.tj ur .ean partt .....: European base port
:: ... ': ... .. Dollars
S": ib. b;ozes contatintni 121 kilos (275.bs.). net: ...... .....
Price -of 4 bojes (110 lbs. net) f.J.b. packing plant :
t 6 cents perpu *........ .............. 6.60
Plus ci.f. differential (at .$.1..Q3 per .100 ibs. gross)
an 124 lbs. 4ross.... .8
: 7.88
n *s cnta......................... .3
*In bjs containing^ R5 kilos (55 'b.lb) net: ..........
Pri6e of 2 b:nes (110 lbs. net) f..b.. pqc4in- plant
at 6 cents'er u s ........... .......... ..... .6.60
Plus"c.i.f. dLfferential (at $1.03 per6 100 lO bs. ross.
on 122 itS. 1ross ........ ".26
.Tjta1 c.i.f. Zuropean ?):t per-122 pounds.-ga:osa..: 7.86
In bags containing 50 kilos .(i0 lbs.) gross .Yr .et :
Price in eiqort b'gis" -110 lbs. "gross for net) at
$0.0575 per pound.......... .,.. .'. .. .: 6.32
Plus c.i.f, differential (at $0.985 per 100 lbs. grass)
on 110 lbs. gross...............................: 1.08
Totkal c.i.f, European pr r per '116.'23 pounds gross: 7.40


For'th'a-rt s of theU ite'ina .'

Quotations to British ports are figured. n the basis of the English
hundredweight f 11l2 pounds instead of on the metric weight unit.. The
handling costs from the packing plant to British ports amounts to $1.03 per
100 pounds gross weight. Thus in the case of prunes packed. in boxes con-
taining 112 pounds net but weighing 125.44 pounds gross the cast f. J.b. plant
at 6 cents per pound would be.$6.72, which -plus the handling, charges.at the
rate of $1.03 per 100 pounds gros wjuli brin; the c.i.f, quotation qp to
$8.01 for a )ack of 125.44 pounds gross or 112 pounds net. This is equivalent
to 33/0 per i12 pounds net, c.i.f. United Kingdom base ports with Sterling
at $4.86.










', -, ,. ..2-
."' "' "- 26 -








Handling .costs from packing plants in the
Willamette:Valley, Oregon, to British ports


Expense i-t erms


: Chages per 100..::::
:pounds grosa wedA


Inland freight (from plant to dock in Portland, Oregon).:
Dock charges (unloading and wharfage).....;;..........:
Ocean freight (common stowage).........................:
Strapping (3 cents per bundle)...........
Marine insurance (average) ..... .......... ...,..... :
Inspection at dock............. ............... ,...,..:
Miscellaneous expenses........ ..... .................. :
Total........... ..... .....*.s....... ..g..... .e g


Dollar:
0.125
.035
.750
.055
.038
.020
1.030


PRUNES: Example of quotation from points in the
Vallev-y. Orezon. c.i.f. British norts.


Willamette


Price f.o.b. Packing Plant plus handling charges
to British ports;


Dollars
Cost f.o.b. Willamette Valley plant in 25 pound boxes (for 112 lbs.:
net) at 6 cents per pound.., ............................ ...... 6.72
Plus c.i.f. differential (at $1.03 per 100 lbs. gross) on 125.44 :
pounds gross weight ...... .... ... ........ .... .,....: 1.29
Total c.i.f. British ports per 125.44 pounds gross.............: 8,01


Other quotations

The c.i.f. quotations for all other ports are figured along similar
lines. When refrigerator space is used instead of common stowage the
handling charges (c.i.f. differentials) are higher. Thus in the case of
shipments to the United Kingdom under refrigeration the ocean freight rate
is 95 cents per 100 pounds instead of 75 tents as in common stowage. This
would make the c.i.f. differential $1.23 per 100 pounds gross instead of
$1.03 and would raise the handling charges on shipments to British base
ports from $1.29 to $1.54 on a shipment of 125.44 pounds gross weight.

Among the c.i.f. charges listed above, the inland freight will vary
greatly. Where plants are located on tidewater and growers deliver to such
a plant this item would be small. The ocean freight of 75 cents per 100
pounds gross weight is for common stowage by Panama Canal to certain base
ports in Europe. To points other than base ports certain additional costs
are added. As already mentioned, twenty cents per 100 pounds are added
where fruit goes under refrigeration. In case out-ports have no refrigerator


- 28 -


PRUNES;












5 a destinationn.

Itrap:ing and labeling

KS Strapping ia common for all shipments to Europe. Either two wires for
a bundle of two 12 kilos(27.5 lbs.) net boxes or one strap for one box is
used Europe rather favors the one strap box as the lighter weight causes
lesseropping and breakage. The larger docks ion the Pacific Coast are now
applied with electric strapping machines. Dried fruit destined for
England is packed in 25 pound boxes net, 28 pounds *ross. For continental
Z.urope the weight of the box is 12 kilos (27.5 pounds) net or 31 pounds
.sross.. Occasionally the 25 kilos (55 pounds) nqt box is used for the
smaller sizes. A differential of front. 1/8 to 1/4 cents per pound is allowed
in favor of the larger box.

SBoxeu are marked-showing brand, size, country of origin, destination and
net contents, jhile lithographed labels are still used by soie shippers,
marks and brands printed into the wood are the most common. Such a mark is
difficult to tamier with and buyers are sure then that they are getting
originall" pack. The value of neatness and uniformity in this respect is
fully appreciateJ when viewing the stored ;oods on the docks after unloading.
Some of the Continental markets buy lard quantities of unprocessed prunes
in bags usually containing 90 kiljs (198 Ibs.).

Factors in the dried fruit trade

Formerly driel fruit sales in the United States were made exclusively by
private operators and exporters. The former jwned jr operated packing houses
while the latter confined their efforts to selling,. These outletss for ex-
port were later augmented by cooperative imaiketing associations. All of
these generally use the established trade outlets abroad. In very recent
years a new type of exporter has developed, the packer-exrorter, who isAn-
dlined to i7nore the established agencies in Eur-pe by going direct t. retail-
ers. In some instances these exporters are not bound by the Dried Fruit
Association contracts and offer essentially different and often nore f4vor-
able terms. Aside from this new tendency, it can be said that many ofthe
export houses have been in business fJr years, have excellent connections and
are thoroughly versed in export demands and developments.

Packers of dried fruits -ay well decide tj limit their efforts tU pack-
ing or tj packin, ani dtestic sellin-, leqvin; the more coz=licated foreign
markets to firms who have asecialized in this field. This method of selling
involves ae eaiititnal agency, anda an extra 2 1 )er cent con'-ission. The
exporter )n occasion, can become the "back tor" for unloadin' dried fruits
where the owner of the fruit dtes nAt care to a-)-ear in the transaction.


- 27 -







This is possible as the identity of the fruit offered d by exporters is
under exporters' own or buyers' brands, There is some evidence in :
that this practice may reach a point where the packer's- own brand may
appear entirely and where his own representatives lose interest in pa.c!....
account. ...

The selling of dried fruits in Europe through the well known obachmns.i
of agent-broker, distributor-wholesaler and retailer, is still very n=1h t": *cbji,!
rule. Practices and methods established over a. great many years are not:'
easily changed'and so interwoven are the interests, financial and otherwNia1.!:
of these factors, that a continuation of this general plan for many years :t1ie'r
come may be expected. Occasionally wholesalers and retailers combine fak:or,
the purpose of buying dried fruit direct. Such combined buying is relatifrij',
smell and is done not only to save brokerage and commission or to s.ecur.@e..
better prices as a result of larger orders but also and mainly to meet th'.;4
competition of large purchasing on the part of cooperative societies and.. .
chain stores, In order to pacify the Ion established brokerage firms a... i'
percentage of the commission thus saved is frequently turned over to them, '

Cooperative buying organizations ::

The grocery chain-store movement has made comparatively little progress.,.,
in Europe as yet but its presence is beginning to be felt and undoubtedly: ""
will become of greater importance in time. In its place, however, karop:
presents in the buying field the large ani growing cooperative consumer, 1
retail and wholesale buying societies. The cooperative consumer and buying
societies are particularly stron. in. En.;land, France, Germany and the "
Scandinavian countries. Or-;anized primarily for mutual financial benefits, i
attempts are male to eliminate items of cost by more direct approach to the.
sources of supply. For this purpose, the functions of agent-broker and dis- i
tributor-wholesaler are absorbed by the or-anizations themselves in the case 4
of the more powerful concerns, Such direct transactions may necessitate the
establishment of offices in important producing countries as has already been
lone by the En~lish Wholesale Cooperative or, as in the case with the 1
Scaniinavian Cooperative, where a central buying office for all the countries
in that area was recently established at Copenhagen.

In nearly every market of Continental Europe the oll agent (broker)
finds himself in the difficult position of trying to decide whether to remain
loyal to the ln; established lines of distribution or whether to seek the
business of the cn)peratives and chain stores wnich are invading the field
of the imp rter. The iimporters resent the invasion .-of their field by these
new agencies and naturally favor exporters and brokers who do nit sell direct
to the cooperati;'es anl chains. The apparent success of the cooperative
consumer and buying r-.ove...ent, evidenced by its growth in recent years, brings
the position of the long established wholesaler ani agent-broker sharply to
the front. The wholesalers inlivi.lualiy an. in groups feel that the ad-
vantages of large scale buying And the elimination of all or.part of the
broker's cimxr.issi)n gives the cooperatives an unfair advantage. Threats of
bjycottin; firms selling to the co perative concerns aid allowing


- 28 -









Ylll^ a-Tr" .p &- "JA SO B UB -U S& WU ~ ea MJ I W (_a *bl&j. .y1/JUOA^M ^UUaJu J .L fUJ.&4U.^ B U *U W
H ^tbtource. of dried fruits,- either irdivisi.uatly or in gro-ups and. eliminating
t)W. o ntO' .cfl4 sOjn is .eiP n tried out. by the wholesalers in sae markets
a experimental w. Some inlividu4il. but powerful packing concerns have
HI !&aeoently. deserted. the "regular! chnn.ls. and.. are .goitg direct- to retail: out-
iPii .... backing. their products with national advertising..
ml,:mi et. backinc hei e
...Agent-brorerin roe "
? -. -' .. *
The ltpier cent commission -.pad.*brkerm...n dried fruits is a uniform
Spractice. 3rokets arnd sellers each take.care of their own cable expenses.
A .in sorme markets tthe agen tplits.coimmissions with.lOcal'brokers the'latter
1 ^;. getting .one percent and the agent retainig..!j per cent. Although there
-;-'t:'ve been -attempts to eliminate the agent as stated above, thereis nothing
itore important for the average .exporter than .a reliable and active represent-
ative. This-is .particularly true where distances-.are great and where
.. peculiarities. and re uire;ents of th.e trade are not .always understood by
the seller. The worth-wNhile agent still, is -the "clearing house'" and "shock-
absorber", fully informed of markett trends and ready to act as impartial in-
vestigator o. arbitrator in settim i7 disputes that are unavoidable.

As 1lona as the. personal. eVreient .is necessary in dried fruit sales,
-the service of .a representative. .:is indispensable. Where powerful. packers"
supply their: awn personal, contact th1e matter becomes .one of relative .cost"
and results,: The 2k per. cent comi-issin-i4s not excessive. In fact'-it is'
made possible only by the agent/carryinr a nu.-ber. of related accounts. Direct
.dealings with one factor or element in the trade, carries the possibility
of developing antag&onisih in other q'aartero to the detriment of the brandt
This does not apply, of. course, where direct dealing has become a matter of
course and iS an accepted practice, or. where. advertising has created a-dis-
tinct cons'm.er demand. In: general- the Lost effective policy-for merchandising
dried fruits .in Eurape is that of supporting existing channels .of.distribution
with personal direction and. pub-licity ..

Qualifications.of a broker .

There is no dearth of agents wishing accounts and from that standpoint
the selection and appointment, of a sales organization in Europe is not dif-
ficult. As in all lines of business, however, finding the desirable represent-
S atives is very difficult. Houses of long standing and prestige are generally
[ well supplied with so-called '!exclusive" accounts. Contacts are often
furnished through our government representatives abroad in which case "Bank
Sreferencesu are furnished but, of necessity, responsibility is waived. The
inherent'weakness of thistethod is that even "bank references" may not indi-
cate existence of the essential qualifications.. It does, however, furnish
the initial getting together.

A desirable broker should above all have integrity, as he must constantly
advise and in the heat of selling he .Lust subr-it reliable and not misleading


- 29 -








.or distorted market inforraati.n. Unlike the celebrated case of theC.
bile.merchant asking for a dried fruit account, it Is desirable that.ti
agent limit his interests to closely related lines.. 'Excluuiven repri
tin or. a brokera.;ehouse representing only one account 'in any.part icuiitm
fruit, should be insisted upon although, except with particularly:largi" i
valuable accounts, this feature in practice is frequently overlookeds .:: :

The uzatter of a brokerage finr-, confinin- its activity strictly 't;..:aJ.
functions of an a.ent and doing no buying on its own account, is in Br ,,
more a question of degree than of absolute adherence to principle. A iAs ...
fresh fruits most dried fruit brokers at one time or other find themlse s: 1.
owners of the fruit but where this.becomes are gular practice the val .'lioait
the agent as a representative is.destroyed and he is eliminated from the.l:pl
of desirable agents. He shoull know his trade and deal only with ,respoiow
outlets. In the matter of representation abroad, there is nothing more .
valuable than personal contacts. This has long been recognized by .the ,"
larger packers whose volume of business has justified them in keeping t-he::W
* men constantly in touch with the markets., .. .

Importance of personal contact in distribution

The personal contact in seizing plays a far greater part in Europe
than it does in the United States. This is partly due -to custom and partly :
to the large number of relatively small countries which make up Europe., each-!`
with different languages, monetary systems, and trade practices.. Our com- i
petitors are taking full advantage of this fact. The Greek Central Currant..."'
Office has a representative in the most important markets and is establish- '
.ing more. The representatives of the Russian Soviet Government take an
active part in the upbuildibg of export markets for that country. The Danish
cooperatives are in close personal contact with their markets. The Empire
Marketing Board represents the interest directly .of England's Empire friit
industry. A few of the large packer-exporters on the Pacific Coast have per-
sonal representatives either permanently located in .the principal markets or..
traveling from one market to another. One large Pacific Coast dried fruit
factor has made excellent use of personal contact through the establishment
of offices in one or two of the principal markets.

As a rule. however, our many fruit cooperatives on the Pacific Coast or
in the United States fall. far short .of making full use of this .valuable asset
in selling abroad. Trade representatives are too often hastily secured with-
out proper investigation as to their fitness. A number of small cooperatives
each with its own export sales organizations, often indifferently represented
and all quoting at variance, precludes the possibility of success. It is
perhaps true that many are 'too small to establish the personal contact so
essential because of the expense involved. The only solution of this dif-
ficulty is to combine their interests. .



-i!
30 ii
'
-30 -









The common lactice of b 7iiin Luprocqsseed prunes tobe packed in
|]| ~ centers began& about thirty years ago and has made rapid progress
Y .s. nce the war, Prune packing centers ir6 now'founda in many arts of Europe.
.!iTaljevo in Yugoslavia Vienna in Austria,. Budapest in Hungary and Bordeaux
i::; t "z France are pacing centers located in the producing areas and have been
I established there 'for mAr.ny years. 'With.'the 'decline of production In-France,
*i, the 3otdeaux packing center is now drfwin upon unprocessed prunes from
i: Amerida to fill out their Own declining ,tonnage About 50 per cent of the
S prunes %nported int6 Bordeaux are in bags for subsequent repackifg; 'Budapest
.and Vienhna,.'which until very recently weIre exclusively .packers of Yugoslav
prunes halve'also begun totdraw upon Pacific ,oast supplies. Hamburg,
Antwerp,and Bremen are the most important packing centers operating'outside
S of the producing areas, Passau, Regensburg and Bratislavia, all located on
the Danube river, are as yet exclusively packers of Yugoslav prunes.

Hamburg leads ii! the'number ,Of plants, v6l.ne Of packing and exports of
packed prunes." The Hamburg' supplle's 'of "natural" iuiprocessed prunes come
from the Pacific Coast Yugoslavial Fraace, Rumania, Bulgaria, Russiar and
Italy. The German owned and operated'prune packing plant at Amsterdam was
active for a time but is now idle; Ant*erp has a flourishing packing indus-
try but the trade is divided in their loyalty to local and "original" pack.
Have has established a &processing plant for prunes for spring and summer
requirements. For the winter demand Havre will continue to rely as in the
past on boxed prunes from the Pacific Coast. Abaut two-thirds of all prunes
imported into Ffance coma in by iay'of Havre and are consumed mainly in
Northern Fran'ce. 'Packing of mixed dried fruits ia common in London and
Helsingfors, Finland.

Advantages and disadvantages of a local packing industry

The advantages of a packing industry 'to the countries in question is not
only strategic from a distributing and marketing standpoint but it provides
employment as regards actual labor in the plants and stimulates production in
the items used in packing, such as nacninery, equipment, nails, box shook and
paper. There is a growing bitef 'in some quarters that local packing facili-
ties are m-ore advantageous in furnishing supplies of freshly packed prunes
for spring and summer needs than for the 'winter requirements. Not a little
stimulus to this ilevelathament does fro, tariff agreements, tne duty on unpro-
cessed prunes in i:any instances beini lower than'the rates on prunes in boxes,
S In some countries thfs:difference is 'very material and L.eans the virtual eaclu-
sion of processed prunes.
; Three important questions unier2ying the development of the packing in-
S dustry in European conswaiing areas must be recc-nized: (i) Do the packing
methods result in cost advantages by permitting lDwer prices and -allowing
more favorable credit terms to buyers? (2) Does the relatively inferior qua-
lity of the f iiished European pack, as alleged in some quarters, affect the


- 31 -







demand for prunes in general?- "(6) 'Does the availability of freshly :
European packed prunes at all times. and under favorable -credit terms inQ
the consumption of prunes in" Europe? .:

If liberties taken in packing prunes in Europe and- consequent -infer4kg3.
quality are causing consumers there to turn to competing fruits ., then e
Pacific CoastAnd Yugoslav prune industries face a serious problem. On..ti....i....
other hand if the availability of. freshly packed prunes. :o f passable quAidt '
and sold under favorable credit terms actually increases the demand for-,.":i.
prunes, particularly during the summer or fresh fruit periods, then the '
producing areas are at least partially reimbursed for the.loss ofa packing :
industry. .,,.

There are undoubtedly important cost advantages in packing prunes in :i
the European consuming areas. Some.of these advantages, however, are the. i
result of questionable practices. These questionable practices, of course, ... 4 ".%
are possible in any packing plant lo matter where located. The Pacific *: 'A|
Coast has very strict and positive rules as to packing but no. such voluntary .|
trade or .government regulation restrict packing practices in Europe. While -,l
the European pack is generally quoted lower than original pack, this is noAt <||
always -the case. Lower prices, however, do not necessarily mean that such "
prices are the result of fraudulent practices since legitimate cost advantages'
are n mall item. 'i

The following is a list of the legitimate cost advantages and of the .*|
questionable packing practices involved in the European prune packing business.

Legitimate cost advantages


(1)
(2)
(3)
(4)


Lower duty on bag prunes than on boxes.
Elimination of strapping charges.
Lower freight on bags than on packed fruit.
Lower labor co.sts.


Questionable packing practices


(1)
(2)
(3)
(4)
(5)
(6)
(7)


Mixing varieties.
Selling goods under wrong classification.
Adling too much moisture.
Packing on points other than regular.
Too wide blending of sizes.
Blowing up to larger sizes.
Packing under weight.


Quality of locally packed prunes


Extensive investigations show that nowhere is the local European pack-
considered equal in quality to "original" .ack. This feeling is most pro-
nouncei in areas away from packing centers and where the local pack is sub-
jected to considerable shipment and handling or where the goods are not
32 -


4




















*i. tthe'Contraty it had meant settlements under @rbitrati., The burden of
'proof is nflw strictly oe'the'jr apean Tackers,

S.ffect of local pack on consuimti.n during summer months

at focl -Ltrticular-
'... '..Evidence' that local 'packing haq increased prune consumption, particular-
ly during the summer or fresh'fruit season is difficult to secures. T3 in-
land buyerean Germany are inclined to the view that it has had this result.
"1'In the past. few ypeari prunes have been moving through Hamburg all the year
S'+i"m' d while in former years there was a stop during the summer months.
raburg packers claim that this improvement is due to the Hamburg pack. It
:is stated that original California oack cannot be shipped through the Panama
t .. ial during the summer mo.u.ths without endangeit:gkhe quality. A, a conseq
SVquence it is concluded that fresh Hamburg pack has created the. summer.market
f+in Germany for prunes. Just what part of the summer cansumpti.)n., hoWever,
'has been due to te" shortage of local fruits and what part to. favorable bvy-
ing factori, is a question that. t.i.e only will determine.

*:zro ean' packers Lrant mjre favorable credit terms

It 'is in the field of' credit that European packers make their strongest
bid f r supremacy. In this tney. are taking advantage if the present lack
of ready capital and credit in many of the European countries. Credit terms
of thirt days are the rule and nmay be extended tJ sixty or even ninety days.
Buyers and their relative ratings are well known through personal contacts
and proximity of buyer to packer. In buying "original pack", the buyer must
anticipate not only his totalre4uirer.ents but sizes within that. order as
well. He is cx-elled to p iy his drafts .uon arrival of, documents while
Sallowing credit terms .to retailers. While the buyer is expected to. anticipate
his yearly requirements as far as pos.si3le when purchasing. European packed
fruit it is nAt necessary for him to accept the sizes within the order and
he may change M assortments" depending upon consumer preference. This in
itself is a bI'' advantage in placing an order. K reover, he can order small
quantities for shipment' throughout the year, thereby assuringf a constant
supply of freshly packed prunes.. This. practice is encouraged by +ackers as
themimAsttre czntent of 'the' packed fruit requires relatively quick turnovers..


- 33 -













The European packing interests contend that there can bq no -Y.td *-
jection on the part of American dried fruit interests to the growing.
tanbe of packing after arrival of the fruit, .The introduction of mode
packing machinery is advanced as proof that the industry in Europe is taj$.
.advantage of the legitimate advantages referred to. Looking at the
packing industry from the standpoint of the Pacific Coast prune industry1h!J
questions must be considered., First, is the loss to the prune packin.gI.;l4||
dustry in the United States serious enough to warrant drastic steps to
it back? Second, if European packing has resulted in increased conso^ .l
would it not be well to refrain ffom any drastic action and take adva.t.ice{
*only-Qf the legitimate, means to maintain the original1 pack in European.":;'.:i,
trade channels? .**.i:

The drastic action referred to mi-.ht include attemnptao induce Erb'iep(Op |ig
governments to equalize customs duties on bag and boxed prunes. Anyone ; .:.;
fau.iliar with European "reciprocal commercial. treaties" realizes t6at.is,...
* would be extremely difficult if not impossible. It has been suggested tait<
Pacific Coast dried fruit interests might ,.-operate packing plants of their: ..
own in European centers.. This is an extremely "rieky" undertAking beca ;e .,!
of distances involved and would nut correct the loss to the American paokisV,
industry. The industry on the Pacific Coast might refuse outright to ell .
prunes in bags. Individual packers have the privilege of taking this at'- ,:,4'
titude but it is scarcely in harmony with American ideals of free selling i:.
and in these years *f heavy craps, European operators would have no diff,-.e ::
culty in securing supplies if necessary throu-4h their own representatives. A:
few years ago .Yugoslavia tried the- expedient of placing an export tax on .. i
bag prunes tut without appreciably reducing bag shipments., Unquestionabl l. 1
an extension of more -favorable credit terms would have desired results but ,
this would endanger the entire dried fnuit contract which has been patiently ^
evolved over a number af years. .'

Those .supporting the secnndI view of taking every legitimate and practiaa
means to maintain the ",ri~inal" pack have the advantage that it is already |
everywhere looked uvon as superior in *q.ality. This reputation should be a .
maintained at all costs as there .is a very definite tendency in Europe to
rely upon originall" iack for the relatively large winter requirements and .
t. draw upon. l'.cal packing mainly for the relatively small summer needs.
The presence if the quickly available, freshly European packed prunes in sui:
mer might well lead to increased consumnA-tion of prunes during the season of i
the year when prune conqum.tijn is ordinarily or non-existent. Developments .:I.::
in this direction 'do- not mean a serio.pAs .inroad in- the present percentage of
boxed prune shipments from the United States. Early fall shipments are I
highly important in order that the European trade may be absolutely sure of ;:i

S34 .".

-AM










fbaving "original" new crop pack on hand for the Christmas trade. If this
,is not &one. countries including thjse where the packing industries are
located, will be forced to rely nore and more on European pack t, meet this
,early demand A wiliingmess on the part of Pacific Coast packers to accept
comparatively small orders, if strictly fresh pack, especially for spring
and summer needs, is also inryrtant. Personal contact and educational ef-
forts to acquaint the trade with the relative.. merits of original pack
would have very gjod results.


- 35 -





UNIVERSITY OF FLORIDA
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3 1262 08929 7435
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