Front Cover
        Front Cover
    Abstract
        Page i
    Acknowledgements
        Page i
    Table of Contents
        Page ii
        Page iii
    Main
        Page 1
        Page 2
        Page 3
        Page 4
        Page 5
        Page 6
        Page 7
        Page 8
        Page 9
        Page 10
        Page 11
        Page 12
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        Page 15
        Page 16
        Page 17
    Reference
        Page 18

R. Clegg Hooks


IA


Economic Information
Report 195


Estimated Costs of Packing
and Selling Fresh Florida Citrus,
1980-81 Season


Food & Resource Economics Department
Agricultural Experiment Stations and
Cooperative Extension Service
Institute of Food and Agricultural Sciences
University of Florida, Gainesville 32611


March 1984


















ABSTRACT


Packing costs increased during the 1980-81 season, with the great-
est increases shown in other direct and indirect operating expense.
Packing costs for two 4/5-bu. cartons of Florida oranges and grapefruit
were estimated at $3.65 and $3.57, an increase of 24.8 and 23.3 percent
above 1979-80. Tangerine and tangelo packing costs for two 4/5-bu.
cartons were estimated at $5.18 and $4.33, an increase of 38.5 percent
for tangerines and 27.0 percent for tangelos. The 1980-81 estimates
were based on accounting information obtained from 22 Florida packing-
houses.


Key words: Fresh citrus packing costs, packinghouse cost trends,
fresh fruit, container costs, labor costs.














ACKNOWLEDGEMENTS



We wish to express our appreciation to the participant packing-
houses for their excellent cooperation, and to Mrs. Theresa Zerr and Ms.
Gwen McCann for their clerical and secretarial assistance.


















ABSTRACT


Packing costs increased during the 1980-81 season, with the great-
est increases shown in other direct and indirect operating expense.
Packing costs for two 4/5-bu. cartons of Florida oranges and grapefruit
were estimated at $3.65 and $3.57, an increase of 24.8 and 23.3 percent
above 1979-80. Tangerine and tangelo packing costs for two 4/5-bu.
cartons were estimated at $5.18 and $4.33, an increase of 38.5 percent
for tangerines and 27.0 percent for tangelos. The 1980-81 estimates
were based on accounting information obtained from 22 Florida packing-
houses.


Key words: Fresh citrus packing costs, packinghouse cost trends,
fresh fruit, container costs, labor costs.














ACKNOWLEDGEMENTS



We wish to express our appreciation to the participant packing-
houses for their excellent cooperation, and to Mrs. Theresa Zerr and Ms.
Gwen McCann for their clerical and secretarial assistance.








TABLE OF CONTENTS


Page

LIST OF TABLES.........................................**.......... ii

SUMMARY...............................................................I

SAMPLE FIRMS.............................................. 1

DATA COLLECTION ......... ............................ ..........2

WEIGHTED AVERAGE PACKING AND BULK HANDLING COSTS......................6

COST TRENDS .................................................... .12

SELECTED REFERENCES... ................................****..*....****18

LIST OF TABLES

Table Page

1 Distribution of citrus handled by class of fruit, 22
Florida packinghouses, 1980-81 season............ ............3

2 Distribution of the sample packinghouses by total volume
packed compared with the industry distribution of firms
in Florida by total volume packed, 1980-81 season.............4

3 Percent of total fruit received which was packed for
shipment by kind of fruit and packinghouse location; 20
packinghouses, 1980-81 season.................... .........4

4 Volume of citrus handled and total packing and selling
cost by type of container, 22 Florida packinghouses,
1980-81 season.......................0....0*.................* 5

5 Weighted average costs of packing and selling Florida
oranges per 1 3/5 -bushel equivalent by type of container,
1980-81 season ...............................................7

6 Weighted average costs of packing and selling Florida
grapefruit per 1 3/5-bushel equivalent by type of container
1980-81 season......o.........................................9

7 Weighted average costs of packing and selling Florida
tangelos and tangerines per 1 3/5-bushel equivalent
by type of container, 1980-81 season.........................11

8 Weighted average costs of handling bulk Florida citrus,
1980-81 season..........................................13








9 Weighted average costs of handling Florida citrus
eliminations, 1980-81 season................................14

10 Percentage change in the items that make up the total
cost of packing 1 3/5-bushel Florida oranges and grape-
fruit in two 4/5-bushel cartons, 1980-81 over 1979-80........15

11 Total cost per 1 3/5-bushel equivalent for packing and
selling Florida citrus by type of pack, 1969-70 through
1980-81 seasons ............................................. 16

12 Value of packed 4/5-bushel cartons of Florida oranges and
grapefruit relative to packing costs, years 1967-68
through 1980-81 seasons, 1 3/5-bushel equivalent boxes.......17

















ESTIMATED COSTS OF PACKING AND SELLING
FRESH FLORIDA CITRUS, 1980-81 SEASON

R. Clegg Hooks

SUMMARY


Packing costs for two 4/5-bushel cartons of Florida oranges and
grapefruit are estimated at $3.651 and $3.57, respectively, for the
1980-81 season. The estimates are 24.8 and 23.3 percent above 1979-80
season estimates. Tangerine packing costs for two 4/5-bushel cartons
are estimated at $5.18, up 38.5 percent from previous season estimates,
and the cost to pack two 4/5-bushel cartons of tangelos was $4.33, an
increase of 27.0 percent.

Packing costs increased during the 1980-81 season, with the great-
est increase shown in other direct and indirect operating expense.

The 1980-81 estimates are based on accounting information obtained
from 22 Florida packinghouses.

SAMPLE FIRMS

The 22 sample Florida packinghouses packed 8,245,382 equivalent
1 3/5-bushel boxes or approximately 28.8 percent of total Florida fresh





IBeginning with the 1975-76 season, tangelo packing costs were
reported separately from orange packing costs. This change in reporting
will cause packing costs for oranges to increase relatively less than if
tangelo packing costs had continued to be included in oranges. This is
predicted on information in this report which shows average tangelo
packing cost to be greater than average orange packing cost (Table 4).

R. CLEGG HOOKS is an assistant in food and resource economics.









fruit shipments [2]. As indicated in Table 1, the sample firms provided
information on a total of over 25.2 million boxes (including elimina-
tions and direct-to-cannery fruit) or 10.8 percent of total Florida
citrus production [2, p. 8].

The distribution of firms by size category shown in Table 2 indi-
cates that the proportion of existing larger firms represented in the
sample is greater than the proportion of smaller firms in the sample.
The average volume packed per packinghouse for all 147 Florida packing-
houses operating during the 1980-81 season was 194,640 equivalent 1 3/5-
bushel boxes [2], while the average sample packinghouse packed 355,682
equivalent 1 3/5-bushel boxes. This was 66.0 percent of the total
volume that went through houses with the balance composed of elimina-
tions (Table 3). The number and type of firms in the sample are res-
tricted by availability of accurate data and firms' willingness to
provide information.

DATA COLLECTION

Most of the firms provided information from their auditors' per-box
cost analysis reports. The average costs of packing the more important
containers reported by the sample firms are shown in Table 4.

For those firms that did not allocate costs to different types of
fruit or packages, per-box cost distributions are based on information
provided by houses that keep more detailed records. Quite often audi-
tors' reports did not show labor costs categories and it was necessary
to distribute per-box labor costs into the categories shown in the
following tables. Again the labor costs distribution was based on
information available from packinghouses showing costs for each labor
category.

In general, the firms tended to use similar methods for allocating
materials, general and administrative, and selling expenses, but labor
and other direct operating expenses were allocated by various methods.

Two different auditing philosophies were reflected by the labor and
direct operating cost allocations shown in the auditors' reports. One









Table 1.--Distribution of citrus handled
packinghouses, 1980-81 season


Class of fruit


by class of fruit, 22 Florida


Total volume


1 3/5-bushel equivalent


5 East Coast packinghouses
Packed fruit
Cannery fruit through house
Total through house
Direct, grove-to-cannery
Total

17 Interior packinghouses
Packed fruit
Cannery fruit through house
Total through house
Direct, grove-to-cannery
Total

22 packinghouses
Packed fruit
Cannery fruit through house
Total through house
Direct, grove-to-cannery
Total


2,474,259
647,047
3,121,299
688,398
3,809,697


5,771,123
3,153,518
8,924,641
12,387,211
21,311,852


8,245,382
3,800,558
12,045,940
13,075,609
25,212,549


aGrove-to-cannery fruit data were not obtained from 12 houses; had
these been included, it would have increased the volume going directly
to cannery. Two firms did not supply information on eliminated fruit.

bCannery fruit through the house is fruit with acceptable internal
quality but does not meet fresh market size or external appearance
standards. Cannery fruit through the house is often called eliminated
fruit or eliminations.


_I___ __ __ _____ ___ ___









Table 2.--Distribution of the sample packinghouses by total volume
packed compared with the industry distribution of firms in
Florida by total volume packed, 1980-81 season
-~~~. =z==,=m ~"~=`n""P"' U'


Total volume
1 3/5-bushel
equivalent


Number of
packinghouses
in Floridaa


Number of
packinghouses
included in
the sample


Percentage of
packinghouses
in the industry
included in
the sample


Less than 200,000 88 4 4.5
200,001 400,000 37 10 27.0
400,001 600,000 12 5 41.7
Greater than 600,000 10 3 30.0


Total 147 22 15.0


aCalculated from [2]. e






Table 3.--Percent of total fruit received which was packed for shipment
by kind of fruit and packinghouse location, 20a packinghouses,
1980-81 season
East Coast Interior All
Kind of Fruit
houses houses houses

Percent Percent Percent
Oranges 80.9 60.6 61.1
Grapefruit 80.2 65.6 71.2
Tangerines 0.0 64.2 64.2
Tangelos 70.6 67.6 67.9

All fruit 80.2 63.3 66.0


aTwo firms did not report eliminations.










Table 4.--Volume of citrus handled and total packing and selling cost by type
of container, 22 Florida packinghouses, 1980-81 season

Total weighted
Commodity and Sample Total average packing
type of container firms volume and selling
cost per box

---1 3/5-bushel equivalent---


Oranges
4/5-bu. fiberboard carton
5-lb. poly. bag in master carton
5-lb. vexar bag in master carton
8-lb. poly. bag in master carton
8-lb. vexar bag in master carton
4/5-bu. fiberboard carton--export
4/5-bu. fiberboard carton--heavy duty
2/5-bu. carton
Bulk in truck sales
Miscellaneous containers
Total packed oranges

Grapefruit
4/5-bu. fiberboard carton
5-lb. poly. bag in master carton
5-lb. vexar bag in master carton
8-lb. poly. bag in master carton
8-lb. vexar bag in master carton
4/5-bu. fiberboard carton--export
2/4-bu. carton
Bulk in truck sales
Miscellaneous containers
Total packed grapefruit

Tangerines
4/5-bu. fiberboard carton
4.5-bu. fiberboard carton--heavy duty
4/5-bu. fiberboard carton--export
4/5-bu. Bruce box
Miscellaneous
Total packed tangerines

Tangelos
4/5-bu. fiberboard carton
4/5-bu. fiberboard carton--heavy duty
5-lb. poly. bag in master carton
5-lb. vexar bag in master carton
Miscellaneous containers
Total tangelos packed

Total packed fruit

Bulk fruit through house to cannery
Oranges
Grapefruit
Tangerines
Tangelos
Total bulk through house


1,771,425
239,490
626,222
9,346
17,266
15,826
144,592
26,357
6,691
41 814
2,899,029


2,852,802
247,471
269,788
8,697
7,629
558,995
14,373
6,450
55,169
4,021,3/4


39,189
412,112
148,067
127,905
20,906
748,1/9


114,495
359,734
48,199
47,378
6 994
5/6,800


22 8,245,382


1,920,200
1,242,920
391,936
245,502
3,800,558


3.65
4.55
4.94
4.52
4.94
3.96
3.76
5.64
2.33
1.98
T 02"


3.57
4.46
4.90
4.34
4.14
4.19
5.09
2.38
2.10
337


5.18
4.09
4.39
5.51
4.48
4.46


4.33
3.82
4.92
5.23
3.08


4.01


.65
.35
.83
.66
75W









philosophy is based on the premise that all labor and other direct oper-
ating costs should be allocated to the packed fruit. The other philo-
sophy is based on the premise that at least some of the direct operating
costs (unloading, grading, etc.) should be borne by the eliminations.2

Of the 22 firms in the sample, 12 firms supplied information
consistent with the first philosophy, 8 firms supplied information
consistent with the second philosophy and two firms did not report
eliminations handling costs. No corrections or adjustment of either
auditing system was made so that the averages shown in the following
tables reflect both auditing philosophies. The procedures used in
calculating the averages shown in this report are the same as those used
in previous reports in this series.

In all tables, administrative expense includes management and
office salaries, office expense, auto and travel, interest paid, tele-
phone and telegraph. Selling includes sales salaries, travel, telephone
and telegraph, and brokerage. Other items include Florida citrus adver-
tising tax, federal-state inspection, precooling, coloring and waxing,
and various industry assessments.

WEIGHTED AVERAGE PACKING AND BULK HANDLING COSTS

The weighted average costs of packing and selling Florida citrus in
various types of containers are presented in Tables 5, 6, and 7.
Detailed costs are shown for only the more important containers listed
in Table 4. Costs for the 4/5-bushel fiberboard carton for Interior and
East Coast houses are shown separately.

The costs shown are the weighted average costs for the sample
packinghouses, i.e., the total monetary costs of each item for all
houses were divided by the total number of boxes packed. The use of
weighted averages tends to result in a lower estimated cost than would




2Eliminations are fruit intended for fresh use but not packed
because of exterior appearance or size. Most eliminations are sent to
processing plants.










Table 5.--Weighted average costs of packing and selling Florida orangesa per
1 3/5 bushel equivalent by type of container, 1980-81 season

Type of Container 4/5-bushel fiberboard box

East Interior All Export
Coast houses houses all houses

Number of packinghouses 5 16 21 4

Average volume packed
1 3/5-bushel equivalent 14,317 106,240 84,354 3,956


Item of Cost
Materials
Containers
Other materials
Total materials

Labor
Receive, truck, dump /
Cratemaking & labeling
Foremen, graders, others
Packing
Truck, check, load
Payroll taxes, comp. ins.
Total labor

Other Direct Operating
Power, lights, water
Repairs & maintenance
Misc. supplies & expense
Total other direct

Indirect Operating
Insurance-fire & casualty
Taxes & licenses
Depreciation & rent
Total indirect operating

Total Packing Expense
Administrative
Selling
Other Items


Total Costs


---------$ per 1 3/5-bushel equivalent-------


1.1116
0.0229
1.1345


0.1472
0.1983
0.4869
0.3345
0.2354
0.2639
1.6662


0.1267
0.4454
0.0534
0.6255


0.0472
0.0293
0.2102
0.2867

3.7129
0.3289
0.2637
0.4998

4.8053


0.9287
0.0449
0.9736


0.0829
0.1072
0.3403
0.2284
0.1808
0.1538
1.0934


0.0962
0.2234
0.0933
0.4129


0.0426
0.0423
0.1933
0.2782

2.7581
0.1577
0.2548
0.4505

3.6211


0.9332
0.0444
0.9776


0.0845
0.1094
0.3439
0.2310
0.1822
0.1565
1.1075


0.0969
0.2289
0.0923
0.4181


0.0427
0.0419
0.1938
0.2784

2.7816
0.1619
0.2551
0.4517

3.6503


Range in total costs--low 4.4754 3.1934 3.1934 3.3648
--high 5.2511 5.6620 5.6620 4.0071
Standard deviation 0.2276 0.4086 0.4448 0.1183

Continued


1.3459
0.1435
1.4894


0.0712
0.0719
0.3939
0.2263
0.1127
0.1071
0.9831


0.1087
0.0975
0.0987
0.3049


0.0174
0.0509
0.1407
0.2090

2.9864
0.2293
0.2474
0.4962

3.9593










Table 5.--Weighted average costs of packing and selling Florida orangesa per
1 3/5-bushel equivalent by type of container, 1980-81 season--
Continued
i i i i ic;I~


Type of Container


5-lb. poly.
bag in
master
carton


8-lb. poly.
bag in
master
carton


5-lb. vexar
bag in
master
carton


8-lb. vexar
bag in
master
carton


Number of packinghouses 16 9 15 12

Average volume packed
(1 3/5-bushel equivalent) 14,968 1,038 41,748 1,485


Item of Cost
Materials
Containers
Other materials
Total materials

Labor
Receive, truck, dump
Cratemaking & labeling
Foremen, graders, others
Packing
Truck, check, load
Payroll taxes, comp. ins.
Total labor

Other Direct Operating
Power, lights, water
Repairs & maintenance
Misc. supplies & expense
Total other direct

Indirect Operating
Insurance-fire & casualty
Taxes & licenses
Depreciation & rent
Total indirect operating


Total Packing Expense
Administrative
Selling
Other Items


Total Costs


----------$ per 1 3/5-bushel equivalent----------


1.6428
0.0707
1.7135


0.0838
0.1238
0.4134
0.3441
0.1763
0.1993
1.3407


0.1057
0.2352
0.0887
0.4296


0.0346
0.0405
0.1842
0.2593

3.7431
0.1302
0.2727
0.4082

4.5542


1.6682
0.0857
1.7539


0.0828
0.1195
0.3876
0.3362
0.1939
0.1648
1.2848


0.0882
0.2556
0.0742
0.4180


0.0354
0.0287
0.1797
0.2438


3.7005
0.1340
0.2563
S0.4280

4.5188


1.9553
0.1025
2.0578


0.0793
0.1127
0.3950
0.3491
0.1765
0.1807
1.2933


0.1028
0.2733
0.0916
0.4677


0.0427
0.0421
0.1935
0.2783

4.0971
0.1351
0.2733
0.4378

4.9433


Range in total costs--low 4.2716 4.1349 4.5493 4.3869
--high 6.9347 5.7679 7.4645 6.8991
Standard deviation 0.3994 0.3000 0.4727 0.4136

aSee footnote 1, page 1.


2.0185
0.0896
2.1081


0.0753
0.1049
0.3439
0.3154
0.1628
0.1556
1.1579


0.0998
0.3268
0.0918
0.5184


0.0513
0.0418
0.1946
0.2877

4.0721
0.1320
0.2853
0.4513

4.9407









Table 6.--Weighted average costs of packing and selling Florida grapefruit per
1 3/5 bushel equivalent by type of container, 1980-81 season


Type of Container 4/5-bushel fiberboard box

East Interior All Export
Coast houses houses all houses

Number of packinghouses 5 16 21 7

Average volume packed
1 3/5-bushel equivalent 367,706 63,392 135,848 79,856


Item of Cost
Materials
Containers
Other materials
Total materials

Labor
Receive, truck, dump
Cratemaking & labeling
Foremen, graders, others
Packing
Truck, check, load
Payroll taxes, comp. ins.
Total labor

Other Direct Operating
Power, lights, water
Repairs & maintenance
Misc. supplies & expense
Total other direct

Indirect Operating
Insurance-fire & casualty
Taxes & licenses
Depreciation & rent
Total indirect operating

Total Packing Expense
Administrative
Selling
Other Items


-------$ per 1 3/5-bushel equivalent-------


1.1077
0.0468
1.1545


0.1124
0.1712
0.2881
0.2643
0.2368
0.2240
1.2968


0.0911
0.2568
0.0463
0.3942


0.0309
0.0190
0.1441
0.1940

3.0395
0.2797
0.2896
0.4572


Total Costs 4.0660


0.9168
0.0273
0.9441


0.0817
0.1071
0.2227
0.1874
0.1868
0.1477
0.9334


0.0792
0.1509
0.0719
0.3020


0.0227
0.0293
0.1374
0.1894

2.3689
0.1422
0.2673
0.4235

3.2019


0.9971
0.0355
1.0326


0.0946
0.1341
0.2502
0.2197
0.2078
0.1797
1.0861


0.0842
0.1954
0.0611
0.3407


0.0261
0.0250
0.1402
0.1913

2.6507
0.2000
0.2767
0.4377

3.5651


Range in total costs--low 3.6586 2.9535 2.9535 3.1319
--high 4.3343 4.8359 4.8359 4.5301
Standard deviation 0.3306 0.3375 0.5421 0.2264

Continued


1.2907
0.0918
1.3825


0.1107
0.1535
0.2898
0.1993
0.2686
0.1710
1.1929


0.0743
0.2826
0.0836
0.4405


0.0304
0.0275
0.2122
0.2701

3.2860
0.1606
0.2484
0.4916

4.1866









Table 6.--Weighted average costs of packing and selling Florida grapefruit per
1 3/5-bushel equivalent by type of container, 1980-81 season--
Continued
~.,------. ~t;~L= =-


Type of Container


5-lb. poly.
bag in
master
carton


8-lb. poly.
bag in
master
carton


5-lb. vexar
bag in
master
carton


8-lb. vexar
bag in
master
carton


Number of packinghouses 17 8 14 7

Average volume packed
(1 3/5-bushel equivalent) 14,557 1,739 19,270 1,089


Item of Cost
Materials
Containers
Other materials
Total materials

Labor
Receive, truck, dump
Cratemaking & labeling
Foremen, graders, others
Packing
Truck, check, load
Payroll taxes, comp. ins.
Total labor

Other Direct Operating
Power, lights, water
Repairs & maintenance
Misc. supplies & expense
Total other direct

Indirect Operating
Insurance-fire & casualty
Taxes & licenses
Depreciation & rent
Total indirect operating

Total Packing Expense
Administrative
Selling
Other Items

Total Costs


Range in total costs--low
--high
Standard deviation


----------$ per 1 3/5-bushel equivalent---------


1.6709
0.0817
1.7526


0.0821
0.1298
0.3645
0.3085
0.1918
0.1945
1.2712


0.0967
0.1952
0.0818
0.3737


0.0261
0.0317
0.1627
0.2205

3.6180
0.1378
0.2707
0.4318

4.4583


3.8648
6.0159
0.3339


1.7595
0.0794
1.8389


0.0961
0.1315
0.3263
0.2890
0.1916
0.1613
1.1958


0.0732
0.2090
0.0650
0.3472


0.0186
0.0197
0.1103
0.1486

3.5305
0.1153
0.2488
0.4459

4.3405


4.0126
4.4995
0.2081


2.0409
0.0556
2.0965


0.0788
0.1320
0.4034
0.3152
0.1968
0.2200
1.3462


0.1100
0.2061
0.0900
0.4061


0.0268
0.0379
0.1561
0.2208

4.0696
0.1321
0.2734
0.4264

4.9015


4.1080
6.5693
0.3508


aSee footnote 1, page 1.


1.4996
0.4889
1.9885


0.0749
0.0938
0.2073
0.2783
0.0759
0.0693
0.7995


0.0310
0.1520
0.0618
0.2448


0.0354
0.0162
0.1400
0.1916

3.2244
0.1515
0.2517
0.5145

4.1421


3.8288
6.0105
0.2856


-- U'









Table 7.--Weighted average costs of packing and selling Florida tangelos
and tangerines per 1 3/5-bushel equivalent by type of
container, 1980-81 season

Type of container Tangelos Tangerines
Type of container
4/5-bushel 4/5-bushel
carton carton

Number of packinghouses 12 8

Average volume packed
(1 3/5-bushel equivalent) 28,623 7,837

Item of Cost -----$ per 1 3/5-bushel equivalent-----
Materials
Containers 0.9152 1.0342
Other materials 0.0173 0.0423
Total materials 0.9325 1.0765

Labor
Receive, truck, dump 0.1668 0.1896
Cratemaking & labeling 0.1906 0.1990
Foremen, graders, others 0.4737 0.8537
Packing 0.2627 0.3508
Truck, check, load 0.2702 0.2588
Payroll, taxes, comp. ins. 0.2823 0.3627
Total labor 1.6463 2.2146

Other Direct Operating
Power, lights, water 0.1516 0.1819
Repairs & maintenance 0.2420 0.2149
Misc. supplies & expense 0.0910 0.2167
Total other direct 0.4846 0.6135

Indirect Operating
Insurance-fire & casualty 0.0303 0.0542
Taxes & licenses 0.0598 0.0545
Depreciation & rent 0.3963 0.2550
Total indirect operating 0.4864 0.3637

Total Packing Expense 3.5498 4.2683
Administrative 0.1938 0.2210
Selling 0.2556 0.2304
Other Items 0.3275 0.4622

Total costs 4.3267 5.1819


Range in costs--low 3.6457 3.7631
--high 5.5001 6.1024
Standard deviation 0.4427 0.9598









the simple average because larger houses, which usually have lower
costs, influence the average more than smaller houses.

Not all of the houses pack every container listed in Table 4. The
cost estimates presented in Tables 5, 6 and 7 are weighted averages for
the firms packing that container. Because the sample houses and weights
(volumes) change with each container, some of the cost differences among
containers can be attributed to the composition of firms packing each
container. The costs of handling and selling bulk fruit are shown in
Table 8. The weighted average costs allocated to eliminations are shown
in Table 9.

COST TRENDS


Changes in the reported costs of packing oranges and grapefruit in
two 4/5-bushel cartons from the 1979-80 to 1980-81 season are shown in
Table 10. Total packing and selling costs for oranges and grapefruit
increased 24.8 and 23.8 percent. This large increase in total packing
costs must partially be attributed to the freeze which occurred during
this season. Specifically, material costs and labor costs increased
10.2 and 21.0 percent for oranges while increasing 12.5 percent and 29.7
percent for grapefruit. Other direct operating costs and indirect
operating costs increased more dramatically 40.8 percent and 48.6 per-
cent for oranges and 36.3 percent and 29.5 percent for grapefruit.

Trends in orange and grapefruit packing costs for the past 12
seasons are reported in Table 11. In general, packing costs have
increased over time including 1980-81.

The relationship between average packing costs and the average FOB
value of packed fruit for two 4/5-bushel cartons of oranges and grape-
fruit in the Interior and East Coast regions for the past 13 seasons is
shown in Table 12. The changes in the ratio have been cyclical. The
value of fruit has shown greater variability than costs which have
tended to increase over time.









Table 8.--Weighted average costs
81 season


Type of Container


of handling bulk Florida citrus, 1980-


Bulk in truck sales


Orangesa


Grapefruit


Number of packinghouses 5 6

Average volume packed
(1 3/5-bushel equivalent) 1,338 1,075


Item of cost
Materials
Containers
Other materials
Total materials

Labor
Receive, truck, dump
Cratemaking & labeling
Foremen, graders, others
Packing
Truck, check, load
Payroll taxes, comp. ins.
Total labor

Other Direct Operating
Power, lights, water
Repairs & maintenance
Misc. supplies & expense
Total other direct

Indirect Operating
Insurance-fire & casualty
Taxes & licenses
Depreciation & rent
Total indirect operating

Total Packing Expense
Administrative
Selling
Other Items


Total Costs


---$ per 1 3/5-bushel equivalent---


0.0
0.0189
0.0189


0.0957
0.0486
0.3479
0.0267
0.0483
0.1360
0.7032


0.0728
0.3037
0.0664
0.4429


0.0689
0.0338
0.2532
0.3559

1.5209
0.1529
0.2149
0.4371

2.3258


0.2194
0.0047
0.2241


0.0772
0.0812
0.4030
0.0225
0.1262
0.1511
0.8612


0.0948
0.1917
0.0486
0.3351


0.0180
0.0370
0.2554
0.3104

1.7308
0.2223
0.0814
0.3471

2.3816


Range in total costs--low 1.5512 1.4466
-high 3.8061 4.2607
Standard deviation 0.3280 0.7455


aSee footnote 1, page 1.


_ __ _____ ___ ___I










Table 9.--Weighted average costs of handling Florida citrus eliminations,
1980-81 season

Bulk through house to cannery

Orangesa Grapefruit Tangerines Tangelos

Number of packinghouses 20 20 16 9

Average volume packed
(1 3/5-bushel equivalent) 96,010 62,146 24,496 27,278


Item of Cost
Materials
Containers
Other materials
Total materials

Labor
Receive, truck, dump
Cratemaking & labeling
Foremen, graders, others
Packing
Truck, check, load
Payroll taxes, comp. ins.
Total labor

Other Direct Operating
Power, lights, water
Repairs & maintenance
Misc. supplies & expense
Total other direct

Indirect Operating
Insurance-fire & casualty
Taxes & licenses
Depreciation & rent
Total indirect operating

Total Packing Expense
Administrative
Selling
Other Items

Total Costs


--------$ per 1 3/5-bushel equivalent---------


0.0
0.0129
0.0129


0.0464
0.0
0.1243
0.0
0.0027
0.0386
0.2120


0.0319
0.1250
0.0370
0.1939


0.0261
0.0147
0.0904
0.1312

0.5500
0.1010
0.0
0.0003

0.6513


0.0
0.0021
0.0021


0.9233
0.0
0.0421
0.0
0.0016
0.0130
0.0800


0.0108
0.0412
0.0157
0.0677


0.0086
0.0053
0.0472
0.0611

0.2109
0.1437
0.0
0.0001

0.3547


0.0
0.0025
0.0025


0.0562
0.0
0.1645
0.0
0.0018
0.0593
0.2818


0.0346
0.1876
0.0278
0.2500


0.0382
0.0165
0.1441
0.1988

0.7331
0.0937
0.0
0.0001

0.8269


0.0
0.0
0.0


0.0539
0.0
0.0919
0.0
0.0
0.0275
0.1733


0.0234
0.1305
0.0282
0.1821


0.0142
0.0156
0.1364
0.1662

0.5216
0.1416
0.0
0.0003

0.6635


Range in total costs--low 0.0776 0.0776 0.0865 0.0865
--high 1.5217 0.8949 2.1487 1.4564
Standard deviation 0.4472 0.2685 0.7034 0.6415


aSee footnote 1, page 1.






Table 10.--Percentage change in the items that make up the total cost of packing 1 3/5-bushel
Florida oranges and grapefruit in two 4/5-bushel cartons, 1980-81 over 1979-80

Type of fruit Orangesa Grapefruit

Season 1980-81 1979-80 Change 1980-81 1979-80 Change

Item of Cost $ per 1 3/5 equivalent Percent $ per 1 3/5-equivalent Percent
Materials
Containers 0.9332 0.8552 + 9.1 0.9971 0.8914 + 11.9
Other materials 0.0444 0.0319 + 39.2 0.0355 0.0261 + 36.0
Total materials U9776 88/71 +102 1.0326 0.9175 + 12.5

Labor
Receive, truck, dump 0.0845 0.0689 + 22.6 0.0946 0.0678 + 39.5
Cratemaking & labeling 0.1094 0.0895 + 22.2 0.1341 0.0884 + 51.7
Foremen, graders, others 0.3439 0.2490 + 38.1 0.2502 0.2065 + 21.2
Packing 0.2310 0.2104 + 9.8 0.2197 0.1802 + 21.9
Truck, check, load 0.1822 0.1620 + 12.5 0.2078 0.1475 + 40.9
Payroll taxes, comp. ins. 0.1565 0.1353 + 15.7 0.1797 0.1471 + 22.2
Total labor =1.TU7 U.915 +T2-T0 176 0.83/5 +-29.7

Other Direct Operating
Power, lights, water 0.0969 0.0601 + 61.2 0.0842 0.0467 + 80.3
Repairs & maintenance 0.2289 0.1708 + 34.0 0.1954 0.1400 + 39.6
Misc. supplies & expense 0.0923 0.0660 + 39.8 0.0611 0.0633 3.5
Total other direct U.417 U_.z69) T 40U.8 34U0T O.250- T36.3

Indirect Operating
Insurance-fire & casualty 0.0427 0.0287 + 48.8 0.0261 0.0263 0.8
Taxes & licenses 0.0419 0.0250 + 67.6 0.0250 0.0202 + 23.8
Depreciation & rent 0.1938 0.1335 45.2 0.1402 0.1012 + 38.5
Total indirect operating U727O8 0.1872 + 482 071913 0.147 + 29.5

Total Packing Expense 2.7816 2.2863 + 21.7 2.6507 2.1527 + 23.1
Administrative 0.1619 0.1283 + 26.2 0.2000 0.1728 + 15.7
Selling 0.2551 0.1823 + 39.9 0.2767 0.2583 + 7.1
Other Items 0.4517 0.3274 + 38.0 0.4377 0.3077 + 42.2

Total Costs 3.6503 2.9243 + 24.8 3.5651 2.8915 + 23.3


aSee footnote 1, page 1.










Table 11.--Total cost per 1 3/5-bushel equivalent for packing and selling
Florida citrus by type of pack, 1969-70 through 1980-81 seasons

4/5-bu. 5-lb. poly. 8-lb. poly. 5-lb. vexar 8-lb. vexar
fiber- bag in bag in bag in bag in
Season board master master master master
box carton carton carton carton

- - - Oranges - -- - -

1969-70 $1.76 2.25 2.21 2.35 2.30
1970-71 1.78 2.23 2.42 2.42 2.33
1971-72 1.81 2.27 2.21 2.41 2.30
1972-73 1.86 2.33 2.22 2.52 2.36
1973-74 2.09 2.63 2.52 2.77 2.67

1974-75 2.18 2.79 2.73 3.01 3.00
1975-76 2.22 2.83 2.86 2.11 2.99
1976-77b 2.60 3.20 3.15 3.51 3.30
1977-78b 2.46 e 3.07 2.96 3.42 3.17
1978-79b 2.64 3.45 3.34 3.78 3.60

1979-80b 2.92 3.84 3.80 4.10 3.88
1980-81 3.65 4.55 4.52 4.94 4.94


- - - Grapefruit - - - --

1969-70 $1.66 2.12 2.13 2.29 2.16
1970-71 1.71 2.14 2.19 2.35 2.21
1971-72 1.72 2.09 2.12 2.31 2.18
1972-73 1.77 2.16 2.01 2.37 2.10
1973-74 2.06 2.52 2.57 2.77 2.67

1974-75 2.21 2.72 2.61 3.01 3.28
1975-76 2.27' 2.91 2.74 3.21 2.88
1976-77 2.55 3.30 3.08 3.59 3.25
1977-78 2.43 3.03 2.85 3.45 3.05
1978-79 2.62 3.33 3.42 3.76 3.55

1979-80 2.89 3.54 3.46 4.03 3.77
1980-81 3.57 4.46 4.34 4.90 4.14

aInformation for seasons prior to 1979-80 is from Hooks [3].
bsee footnote 1, page 1.










Table 12.--Value of packed 4/5-bushel cartons of Florida oranges and
grapefruit relative to packing costs, years 1967-68 through 1980-81
seasons, 1 3/5-bushel equivalent boxes

Interior East Coast

Season FOB value Packing FOB value Packing
of packed cost Ratioc of packed cost Ratioc
fruita fruita


Oranges
1967-68
1968-69
1969-70
1970-71
1971-72

1972-73
1973-74
1974-75
1975-76d
1976-77d

1977-78d
1978-79d
1979-80d
1980-81d

Grapefruit
1967-68
1968-69
1969-70
1970-71
1971-72

1972-73
1973-74
1974-75
1975-76
1976-77

1977-78
1979-79
1979-80
1980-81


$ per 1 3/5-bu.
equivalent


4.56
4.36
3.86
4.26
5.08

4.66
5.14
5.42
5.64
5.92

9.00
10.20
8.44
12.62


4.68
4.72
4.60
4.86
5.16

5.30
5.16
5.84
5.26
5.68

5.51
7.00
7.84
8.78


1.53
1.59
1.63
1.75
1.80

/ 1.86
2.04
2.13
2.19
2.56

2.44
2.62
2.87
3.62


1.84
1.90
2.01
1.89
2.01

2.14
1.87
1.94
2.05
2.28

2.25
2.44
2.54
3.20


Percent


32
36
42
41
35

40
40
39
39
43

27
26
34
29


39
40
44
39
39

40
36
33
39
40

41
35
32
36


$ per 1 3/5-bu.
equivalent


5.50
4.72
4.60
4.86
5.44

4.80
5.30
5.68
6.12
5.86

8.96
9.90
8.64
12.38


5.70
4.30
5.04
5.20
5.80

6.12
5.74
6.46
6.16
6.60

6.54
7.95
9.18
10.26


1.84
1.90
2.01
1.89
2.01

2.14
2.47
2.56
2.38
3.23

3.15
3.34
3.87
4.81


1.67
1.72
1.81
1.84
1.84

1.96
2.21
2.36
2.38
2.77

2.71
2.98
3.19
4.07


aFrom Florida Citrus Manual [1].
seasons prior to 1975-76 are from Hooks and Kilmer [3].

CRatio = packing cost value of packed fruit.
dsee footnote 1, page 1.


Percent


33
40
44
39
37

44
47
45
39
55

35
34
45
39


29
40
36
35
32

32
39
37
39
42

41
37
35
40



















SELECTED REFERENCES


Florida Citrus Mutual. Statistical Bulletin. Lakeland: var-
ious issues.


Florida Division of Fruit and Vegetable Inspection.
Season Annual Report. Winter Haven: 1981.


1980-81


[3] Hooks, R. Clegg and Richard L. Kilmer. Estimated Costs of
Packing and Selling Florida Citrus, 1979-80 Season. Food
and Resource Economics Department Economic Information
Report 145. Gainesville: University of Florida,
June 1981.






















This public document was promulgated at an annual cost of $202.91 or
$0.18 per copy to report citrus harvesting research results to county
agricultural directors and firms and agencies in the citrus industry.