• TABLE OF CONTENTS
HIDE
 Copyright
 Front Cover
 Table of Contents
 Acknowledgement
 Introduction
 Organization of the industry
 Marketing celery
 Theoretical guidelines for price...
 Summary
 Literature cited
 Statistical analysis of the weekly...
 Back Cover






Group Title: Bulletin - University of Florida. Agricultural Experiment Station - no. 709
Title: Market organization and operation of the Florida celery industry
CITATION PAGE IMAGE ZOOMABLE PAGE TEXT
Full Citation
STANDARD VIEW MARC VIEW
Permanent Link: http://ufdc.ufl.edu/UF00027535/00001
 Material Information
Title: Market organization and operation of the Florida celery industry
Series Title: Bulletin University of Florida. Agricultural Experiment Station
Physical Description: 75 p. : charts, maps ; 23 cm.
Language: English
Creator: Brooke, Donald Lloyd, 1915-
Jung, George Henry, 1938-
Publisher: Agricultural Experiment Stations, Institute of Food and Agricultural Sciences, University of Florida
Place of Publication: Gainesville Fla
Publication Date: 1966
 Subjects
Subject: Celery industry -- Florida   ( lcsh )
Celery -- Marketing   ( lcsh )
Genre: government publication (state, provincial, terriorial, dependent)   ( marcgt )
bibliography   ( marcgt )
non-fiction   ( marcgt )
 Notes
Bibliography: Bibliography: p. 92.
Statement of Responsibility: D.L. Brooke, G.H. Jung.
General Note: Cover title.
Funding: Bulletin (University of Florida. Agricultural Experiment Station) ;
 Record Information
Bibliographic ID: UF00027535
Volume ID: VID00001
Source Institution: Marston Science Library, George A. Smathers Libraries, University of Florida
Holding Location: Florida Agricultural Experiment Station, Florida Cooperative Extension Service, Florida Department of Agriculture and Consumer Services, and the Engineering and Industrial Experiment Station; Institute for Food and Agricultural Services (IFAS), University of Florida
Rights Management: All rights reserved, Board of Trustees of the University of Florida
Resource Identifier: aleph - 000929301
oclc - 18363713
notis - AEP0081

Table of Contents
    Copyright
        Copyright
    Front Cover
        Page 1
    Table of Contents
        Page 2
    Acknowledgement
        Page 2
    Introduction
        Page 3
        Page 4
        Purpose of study
            Page 3
        Source of data
            Page 3
    Organization of the industry
        Page 5
        Florida fresh produce exchange
            Page 5
            Page 6
        Celery marketing order
            Page 7
            Purpose
                Page 7
            Administration
                Page 7
            Quantity regulations
                Page 8
            Quality, pack, and container regulations
                Page 9
            Unfair trade practices
                Page 9
            Research studies and projects
                Page 9
            Advertising and promotion
                Page 9
            Assessments
                Page 10
        Producing areas and firms
            Page 10
            Areas
                Page 10
            Firms
                Page 10
                Page 11
                Page 12
        Shipping areas
            Page 13
            Weekly shipments
                Page 14
            Weekly prices
                Page 14
                Page 15
                Page 16
            Sizes of celery
                Page 17
        Authorized sales firms
            Page 18
            Page 19
    Marketing celery
        Page 20
        Bases of sale
            Page 20
            Page 21
            Shipping areas
                Page 22
            Sizes of firms
                Page 23
            Weekly shipments
                Page 24
                Page 25
                Page 26
            Sizes of celery
                Page 27
            Types of buyers
                Page 27
                Page 28
                Page 29
            Methods of transportation
                Page 30
            Market distribution
                Page 31
                Page 32
        Types of buyers
            Page 33
            Page 34
            Page 35
            Page 36
            Page 37
            Page 38
            Page 39
            Page 40
            Page 41
            Page 42
        Interpackinghouse sales
            Page 43
            Page 44
            Page 45
            Page 46
        Methods of transportation
            Page 47
            Page 48
            Page 49
        Market distribution
            Page 50
    Theoretical guidelines for price and marketable output
        Page 51
        The economic model
            Page 51
            Page 52
            Page 53
            Page 54
            Page 55
            Page 56
        Assumptions of the analysis
            Page 57
        Short run
            Page 58
            Page 59
        Intermediate period-season
            Page 60
            Page 61
            Page 62
            Page 63
        Long run
            Page 64
            Page 65
    Summary
        Page 66
        Page 67
        Page 68
        Page 69
        Page 70
        Page 71
    Literature cited
        Page 72
    Statistical analysis of the weekly price-quantity relationship
        Page 73
        Page 74
        Page 75
    Back Cover
        Back Cover
Full Text





HISTORIC NOTE


The publications in this collection do
not reflect current scientific knowledge
or recommendations. These texts
represent the historic publishing
record of the Institute for Food and
Agricultural Sciences and should be
used only to trace the historic work of
the Institute and its staff. Current IFAS
research may be found on the
Electronic Data Information Source
(EDIS)

site maintained by the Florida
Cooperative Extension Service.






Copyright 2005, Board of Trustees, University
of Florida




BULLETIN 709


Agricultural Experiment Stations
Institute of Food and Agricultural Sciences
University of Florida, Gainesville
J. R. Beckenbach, Director

D. L. BROOKE, G. H. JUNG

MARKET ORGANIZATION
AND OPERATION
OF THE FLORIDA
CELERY INDUSTRY


APRIL 1966







CONTENTS


INTRODUCTION
Purpose of Study ---
Source of Data ---

ORGANIZATION OF
THE INDUSTRY --
Florida Fresh Produce
Exchange
Celery Marketing Order ---..
Purpose ----_ --
Administration
Quantity Regulations -
Quality, Pack, and
Container Regulations
Unfair Trade Practices
Research Studies
and Projects --
Advertising and Promotion
Assessments
Producing Areas and Firms
Areas --. -
Firms
Shipping Areas ------
Weekly Shipments -.---
Weekly Prices
Sizes of Celery _.-----
Authorized Sales Firms --

MARKETING CELERY --..-.
Bases of Sale --. ----
Shipping Areas ----
Sizes of Firms ---.---
Weekly Shipments --
Sizes of Celery -.--..-.-....._-
Types of Buyers ---
Methods of Transportation
Market Distribution ----.-_-


3 MARKETING CELERY
3 Types of Buyers --- --
3 Shipping Areas ---------------
Sizes of Firms
5 Weekly Shipments ------
Sizes of Celery -----
5 Methods of Transportation _-
7 Market Distribution .------.. -
7 Interpackinghoue Sales --...
Methods of Transportation --
Shipping Areas .---
8 Sizes of Firms ----.
Weekly Shipments .---.---. -
Market Distribution ..-------. -
9 Weekly Shipments -...---
Methods of Transportation _
9
9 THEORETICAL GUIDELINES
10 FOR PRICE AND
S MARKETABLE OUTPUT --
LO
The Economic Model -.------
S Number of Sellers ------.--
L3 Collusion .----- -
L3 Identical Products --..
4 Assumptions of the Analysis
4 Short Run ..-------.....------
L7 Maximization of Revenue --
18 Evaluation -.----------
Intermediate Period-Season
20 Maximization of Profits ----
20 Evaluation ---- ---
22 Long Run ..... ----
33 Maximization of Profits ---
24 Evaluation
27 SUMMARY -----------
27
30 LITERATURE CITED ---.. -.--
31 APPENDIX


ACKNOWLEDGMENTS
Some of the data in this bulletin was originally in a thesis
presented by G. H. Jung to the Graduate Council of the Univer-
sity of Florida in partial fulfillment of the requirements for
the degree Master of Science. The authors express their appre-
ciation to the managers of the Florida celery firms and to the
personnel of the Florida Celery Advisory Committee and Fresh
Produce Exchange who cooperated in providing the data which
made this study possible.







CONTENTS


INTRODUCTION
Purpose of Study ---
Source of Data ---

ORGANIZATION OF
THE INDUSTRY --
Florida Fresh Produce
Exchange
Celery Marketing Order ---..
Purpose ----_ --
Administration
Quantity Regulations -
Quality, Pack, and
Container Regulations
Unfair Trade Practices
Research Studies
and Projects --
Advertising and Promotion
Assessments
Producing Areas and Firms
Areas --. -
Firms
Shipping Areas ------
Weekly Shipments -.---
Weekly Prices
Sizes of Celery _.-----
Authorized Sales Firms --

MARKETING CELERY --..-.
Bases of Sale --. ----
Shipping Areas ----
Sizes of Firms ---.---
Weekly Shipments --
Sizes of Celery -.--..-.-....._-
Types of Buyers ---
Methods of Transportation
Market Distribution ----.-_-


3 MARKETING CELERY
3 Types of Buyers --- --
3 Shipping Areas ---------------
Sizes of Firms
5 Weekly Shipments ------
Sizes of Celery -----
5 Methods of Transportation _-
7 Market Distribution .------.. -
7 Interpackinghoue Sales --...
Methods of Transportation --
Shipping Areas .---
8 Sizes of Firms ----.
Weekly Shipments .---.---. -
Market Distribution ..-------. -
9 Weekly Shipments -...---
Methods of Transportation _
9
9 THEORETICAL GUIDELINES
10 FOR PRICE AND
S MARKETABLE OUTPUT --
LO
The Economic Model -.------
S Number of Sellers ------.--
L3 Collusion .----- -
L3 Identical Products --..
4 Assumptions of the Analysis
4 Short Run ..-------.....------
L7 Maximization of Revenue --
18 Evaluation -.----------
Intermediate Period-Season
20 Maximization of Profits ----
20 Evaluation ---- ---
22 Long Run ..... ----
33 Maximization of Profits ---
24 Evaluation
27 SUMMARY -----------
27
30 LITERATURE CITED ---.. -.--
31 APPENDIX


ACKNOWLEDGMENTS
Some of the data in this bulletin was originally in a thesis
presented by G. H. Jung to the Graduate Council of the Univer-
sity of Florida in partial fulfillment of the requirements for
the degree Master of Science. The authors express their appre-
ciation to the managers of the Florida celery firms and to the
personnel of the Florida Celery Advisory Committee and Fresh
Produce Exchange who cooperated in providing the data which
made this study possible.






MARKET ORGANIZATION AND OPERATION

OF THE FLORIDA CELERY INDUSTRY

1963

D. L. Brooke and G. H. Jung'

INTRODUCTION

Purpose of Study
Prior to the 1961-62 season Florida celery was produced and
sold by individual firms in open competition with each other for
a portion of the Florida share of the national celery market.
These firms were supplying more celery than the market would
absorb at a price which would return a fair profit to the growers.
Evidence of this is the fact that between 1950 and 1961 the
number of farms producing celery in Florida decreased from
165 to 38,2 and the number of sales agencies declined from about
22 to 14.3 In this period market prices for Florida celery often
were below the costs of production, harvesting, and marketing
for the most efficient firms (Figure 1).
In 1961, following three successive years in which prices
were below $2.00 per crate, most growers were faced with loss
of credit and possible bankruptcy unless some method of market-
ing could be found to achieve higher prices and to provide more
control over the marketing of celery during the Florida season.
The organization which the industry adopted and the methods
under which it operated during the 1962-63 season are the
subjects of this study.

Source of Data
Three sources of information were used in collecting data.
First, a 10 percent sample of all sales invoices was taken from
12 of the 14 authorized sales firms of the Florida Fresh Produce
Exchange. The second source was from interviews with 12 of
the 14 authorized sales agents. An interview schedule was used

'Agricultural Economist and Former Research Assistant, Agricultural
Economics Department, Florida Agricultural Experiment Station, Gaines-
ville, Florida.
SFlorida Celery Advisory Committee records.
3 Unpublished data, Florida Agricultural Experiment Stations.







Florida Agricultural Experiment Stations


Dollars
Per Crate
4.00






3.00
FOB Price





2.00
tt t!


Range in Total Cost


1.00







1947 49 51 53 55 57 59 61 63
Year of Season Ending
Figure 1.-Relation of season average FOB price of celery to range in total cost
per crate, Florida, 1946-47 to 1962-63.

f Cost data not available.

Source: USDA, SRS, Florida Crop and Livestock Reporting Service,
Annual Statistical Summaries, 1947-63 and D. L. Brooke, Costs
and Returns from Vegetable Crops in Florida, Florida Agricul-
tural Experiment Station, Agricultural Economics Mimeo Re-
ports, 1949-58 and 1962-64.

to develop data utilized in determining and evaluating the organi-
zation of individual firms and differences in their sales policies
and marketing practices. Thirdly, data from secondary and
unpublished sources were utilized for the purpose of making
comparisons of various aspects of past and present operations
of the celery industry.






MARKET ORGANIZATION AND OPERATION

OF THE FLORIDA CELERY INDUSTRY

1963

D. L. Brooke and G. H. Jung'

INTRODUCTION

Purpose of Study
Prior to the 1961-62 season Florida celery was produced and
sold by individual firms in open competition with each other for
a portion of the Florida share of the national celery market.
These firms were supplying more celery than the market would
absorb at a price which would return a fair profit to the growers.
Evidence of this is the fact that between 1950 and 1961 the
number of farms producing celery in Florida decreased from
165 to 38,2 and the number of sales agencies declined from about
22 to 14.3 In this period market prices for Florida celery often
were below the costs of production, harvesting, and marketing
for the most efficient firms (Figure 1).
In 1961, following three successive years in which prices
were below $2.00 per crate, most growers were faced with loss
of credit and possible bankruptcy unless some method of market-
ing could be found to achieve higher prices and to provide more
control over the marketing of celery during the Florida season.
The organization which the industry adopted and the methods
under which it operated during the 1962-63 season are the
subjects of this study.

Source of Data
Three sources of information were used in collecting data.
First, a 10 percent sample of all sales invoices was taken from
12 of the 14 authorized sales firms of the Florida Fresh Produce
Exchange. The second source was from interviews with 12 of
the 14 authorized sales agents. An interview schedule was used

'Agricultural Economist and Former Research Assistant, Agricultural
Economics Department, Florida Agricultural Experiment Station, Gaines-
ville, Florida.
SFlorida Celery Advisory Committee records.
3 Unpublished data, Florida Agricultural Experiment Stations.






MARKET ORGANIZATION AND OPERATION

OF THE FLORIDA CELERY INDUSTRY

1963

D. L. Brooke and G. H. Jung'

INTRODUCTION

Purpose of Study
Prior to the 1961-62 season Florida celery was produced and
sold by individual firms in open competition with each other for
a portion of the Florida share of the national celery market.
These firms were supplying more celery than the market would
absorb at a price which would return a fair profit to the growers.
Evidence of this is the fact that between 1950 and 1961 the
number of farms producing celery in Florida decreased from
165 to 38,2 and the number of sales agencies declined from about
22 to 14.3 In this period market prices for Florida celery often
were below the costs of production, harvesting, and marketing
for the most efficient firms (Figure 1).
In 1961, following three successive years in which prices
were below $2.00 per crate, most growers were faced with loss
of credit and possible bankruptcy unless some method of market-
ing could be found to achieve higher prices and to provide more
control over the marketing of celery during the Florida season.
The organization which the industry adopted and the methods
under which it operated during the 1962-63 season are the
subjects of this study.

Source of Data
Three sources of information were used in collecting data.
First, a 10 percent sample of all sales invoices was taken from
12 of the 14 authorized sales firms of the Florida Fresh Produce
Exchange. The second source was from interviews with 12 of
the 14 authorized sales agents. An interview schedule was used

'Agricultural Economist and Former Research Assistant, Agricultural
Economics Department, Florida Agricultural Experiment Station, Gaines-
ville, Florida.
SFlorida Celery Advisory Committee records.
3 Unpublished data, Florida Agricultural Experiment Stations.






Florida Celery Industry


ORGANIZATION OF THE INDUSTRY

In April 1961 the Florida celery industry was organized into
a master sales exchange, and later the same year a state market-
ing order was adopted. All celery growers and shippers, with a
few minor exceptions, joined voluntarily into one master sales
cooperative through the organization of the Exchange and the
provisions of the marketing order. Their action provided for a
mechanism which could bring about volume control, pricing
stability, and standard marketing operations for the entire in-
dustry. The state marketing order authorized indirect and direct
production controls, an advertising assessment, and other pro-
visions. The voluntary sales cooperative and compulsory mar-
keting order programs operate with an interlocking group of
directorships and committees. Members of the industry have a
desire to make both programs successful. This has been backed
by a willingness to take aggressive and positive action, such as
voluntary volume control and shipping point pricing, to solve
their basic marketing problems.

Florida Fresh Produce Exchange
The Florida Fresh Produce Exchange is the master sales
organization. It is not a new concept, nor does it incorporate
any unusual innovations. Its charter and bylaws are revised
versions of standard incorporating forms. In general, the mem-
bers, by means of growers' contracts, have passed complete mar-
keting control and title to their celery to the Exchange. The
Exchange, in order to market the celery, has signed handler
contracts with existing and thoroughly experienced celery ship-
pers who were made authorized sales agents for the Exchange.
These sales contracts require the agents to abide by all rules
and regulations of the Exchange, including the sale of celery
for its members at prices established by the directors of the
Exchange.
The membership of the Exchange is composed of celery
growers. A 15-member board of directors is selected from the
membership. The board of directors appoints a three-man execu-
tive committee to which all the powers of the board of directors
is given. A general manager is selected by the board of directors
to administer three divisions: (a) Informational Service, (b)
Compliance, and (c) Promotion and Advertising. George M.






Florida Celery Industry


ORGANIZATION OF THE INDUSTRY

In April 1961 the Florida celery industry was organized into
a master sales exchange, and later the same year a state market-
ing order was adopted. All celery growers and shippers, with a
few minor exceptions, joined voluntarily into one master sales
cooperative through the organization of the Exchange and the
provisions of the marketing order. Their action provided for a
mechanism which could bring about volume control, pricing
stability, and standard marketing operations for the entire in-
dustry. The state marketing order authorized indirect and direct
production controls, an advertising assessment, and other pro-
visions. The voluntary sales cooperative and compulsory mar-
keting order programs operate with an interlocking group of
directorships and committees. Members of the industry have a
desire to make both programs successful. This has been backed
by a willingness to take aggressive and positive action, such as
voluntary volume control and shipping point pricing, to solve
their basic marketing problems.

Florida Fresh Produce Exchange
The Florida Fresh Produce Exchange is the master sales
organization. It is not a new concept, nor does it incorporate
any unusual innovations. Its charter and bylaws are revised
versions of standard incorporating forms. In general, the mem-
bers, by means of growers' contracts, have passed complete mar-
keting control and title to their celery to the Exchange. The
Exchange, in order to market the celery, has signed handler
contracts with existing and thoroughly experienced celery ship-
pers who were made authorized sales agents for the Exchange.
These sales contracts require the agents to abide by all rules
and regulations of the Exchange, including the sale of celery
for its members at prices established by the directors of the
Exchange.
The membership of the Exchange is composed of celery
growers. A 15-member board of directors is selected from the
membership. The board of directors appoints a three-man execu-
tive committee to which all the powers of the board of directors
is given. A general manager is selected by the board of directors
to administer three divisions: (a) Informational Service, (b)
Compliance, and (c) Promotion and Advertising. George M.






Florida Agricultural Experiment Stations


Talbott, General Manager of the Exchange since 1961, explains
the activities of the Exchange as follows:

Each morning our usual routine is to obtain from our fieldmen
the total harvest for the previous day by sizes, the expected harvest
for the day, amount on hand, and the amount left to be sold at the
time of the call. The Exchange office then consolidates this informa-
tion and relays it and other pertinent information to the Executive
Committee. These committee members contact specific salesmen
assigned to them with whom they discuss market conditions and
trends. Daily or whenever required, the Executive Committee meets
by telephone or in assembled meetings with the general manager,
at which time movement, competition, weather, supplies on hand
and supply prospects are considered. Prices by sizes are then
established by the Executive Committee. These selling instructions
are then relayed to the authorized sales agents by the General
Manager (7).'
Other measures which the Exchange may use to aid in the
marketing of celery are cutting holidays,5 regulating the grades
and packs shipped, controlling the size and type of containers,
promoting and merchandising Florida celery, developing infor-
mation, and taking any other constructive action which will best
promote the interests of the members of the Exchange and the
celery industry.
The Exchange has faced many problems since its organiza-
tion. Two of the more important were to acquaint buyers with
the program so as to avoid any bias or prejudice and, further,
to assist authorized sales agents in adjusting to the new opera-
tional procedure which, at times, has been contrary to their
previous experiences and operational methods. Some continuing
problems are to obtain accurate information on current celery
production in California, particularly the daily and weekly
volume; to allow for variations in celery qualities which make
it difficult to adhere to uniform prices without special considera-
tion; to take advantage of historical and current information
on celery when there is a need to project potential supplies and
prices in order to make price determinations and exercise con-
trol over existing supplies; to adjust volume to potential demand;
and to provide orderly marketing through establishing firm
weekly or semi-weekly prices for celery. This somewhat drastic
experiment in pricing a perishable for weekly intervals is gradu-
ally becoming perfected through the use of floor and ceiling

'Numbers in parentheses refer to Literature Cited.
SDays or periods during which no celery is harvested.







Florida Celery Industry


prices, with retroactive price protection to buyers during the
pricing periods, and allowing some flexibility in hardship cases.
Nevertheless, there are still some vital problems to be solved.


Celery Marketing Order
The Celery Marketing Order (as amended 1962) was author-
ized by The Florida Celery Marketing Act of 1959, Chapter 573,
Florida Statutes, as amended. This law provided the framework
under which the celery industry could adopt a marketing order
if approved by its growers and handlers and the Commissioner
of Agriculture. Adoption of the Order, as amended, required the
approval of 75 percent of the celery producers having 75 percent
of the volume of celery, and of 75 percent of the handlers mar-
keting 75 percent of the volume affected. Thus approved, the
regulations and restrictions issued under the authority of the
Order are binding on all growers and handlers of celery grown
and sold in the designated area. The Marketing Order may be
suspended or terminated at the end of a marketing season by
the Commissioner of Agriculture when such action is requested
in writing by more than 50 percent of the producers covered by
the Order who produce for market more than 50 percent of the
volume of celery produced in Florida. The important provisions
of the Marketing Order are discussed below.
Purpose.-The purposes of the Act and of the Marketing
Order are to provide for more orderly marketing of celery and
to improve returns to growers. Provisions of the Order intended
to promote these purposes are quantity regulation, quality, pack
and container regulations, prohibition of unfair trade practices,
research, and advertising.
Administration.-The primary responsibility for the admin-
istration of the Marketing Order rests with the Commissioner
of Agriculture. He is authorized to appoint a 15-member Celery
Advisory Committee, the majority of whom shall be producers,
to recommend rules and regulations to the Commissioner and to
administer the Order with his approval. Committeemen (and
alternates) are elected at an annual meeting of the producers.
Five members and alternates are nominated from the South
Florida District, three from Central Florida, two from the West
Coast-North Florida District, two from among producers whose







Florida Celery Industry


prices, with retroactive price protection to buyers during the
pricing periods, and allowing some flexibility in hardship cases.
Nevertheless, there are still some vital problems to be solved.


Celery Marketing Order
The Celery Marketing Order (as amended 1962) was author-
ized by The Florida Celery Marketing Act of 1959, Chapter 573,
Florida Statutes, as amended. This law provided the framework
under which the celery industry could adopt a marketing order
if approved by its growers and handlers and the Commissioner
of Agriculture. Adoption of the Order, as amended, required the
approval of 75 percent of the celery producers having 75 percent
of the volume of celery, and of 75 percent of the handlers mar-
keting 75 percent of the volume affected. Thus approved, the
regulations and restrictions issued under the authority of the
Order are binding on all growers and handlers of celery grown
and sold in the designated area. The Marketing Order may be
suspended or terminated at the end of a marketing season by
the Commissioner of Agriculture when such action is requested
in writing by more than 50 percent of the producers covered by
the Order who produce for market more than 50 percent of the
volume of celery produced in Florida. The important provisions
of the Marketing Order are discussed below.
Purpose.-The purposes of the Act and of the Marketing
Order are to provide for more orderly marketing of celery and
to improve returns to growers. Provisions of the Order intended
to promote these purposes are quantity regulation, quality, pack
and container regulations, prohibition of unfair trade practices,
research, and advertising.
Administration.-The primary responsibility for the admin-
istration of the Marketing Order rests with the Commissioner
of Agriculture. He is authorized to appoint a 15-member Celery
Advisory Committee, the majority of whom shall be producers,
to recommend rules and regulations to the Commissioner and to
administer the Order with his approval. Committeemen (and
alternates) are elected at an annual meeting of the producers.
Five members and alternates are nominated from the South
Florida District, three from Central Florida, two from the West
Coast-North Florida District, two from among producers whose







Florida Celery Industry


prices, with retroactive price protection to buyers during the
pricing periods, and allowing some flexibility in hardship cases.
Nevertheless, there are still some vital problems to be solved.


Celery Marketing Order
The Celery Marketing Order (as amended 1962) was author-
ized by The Florida Celery Marketing Act of 1959, Chapter 573,
Florida Statutes, as amended. This law provided the framework
under which the celery industry could adopt a marketing order
if approved by its growers and handlers and the Commissioner
of Agriculture. Adoption of the Order, as amended, required the
approval of 75 percent of the celery producers having 75 percent
of the volume of celery, and of 75 percent of the handlers mar-
keting 75 percent of the volume affected. Thus approved, the
regulations and restrictions issued under the authority of the
Order are binding on all growers and handlers of celery grown
and sold in the designated area. The Marketing Order may be
suspended or terminated at the end of a marketing season by
the Commissioner of Agriculture when such action is requested
in writing by more than 50 percent of the producers covered by
the Order who produce for market more than 50 percent of the
volume of celery produced in Florida. The important provisions
of the Marketing Order are discussed below.
Purpose.-The purposes of the Act and of the Marketing
Order are to provide for more orderly marketing of celery and
to improve returns to growers. Provisions of the Order intended
to promote these purposes are quantity regulation, quality, pack
and container regulations, prohibition of unfair trade practices,
research, and advertising.
Administration.-The primary responsibility for the admin-
istration of the Marketing Order rests with the Commissioner
of Agriculture. He is authorized to appoint a 15-member Celery
Advisory Committee, the majority of whom shall be producers,
to recommend rules and regulations to the Commissioner and to
administer the Order with his approval. Committeemen (and
alternates) are elected at an annual meeting of the producers.
Five members and alternates are nominated from the South
Florida District, three from Central Florida, two from the West
Coast-North Florida District, two from among producers whose






Florida Agricultural Experiment Stations


celery was marketed by the handler who shipped the second
largest volume of celery in the immediately preceding season,
and three from among the producers whose celery was marketed
by the handler who shipped the largest volume of celery in the
immediately preceding season. This method assures representa-
tion of all producing areas and some additional representation
of large volume handlers. All members or alternates serve for
a period of one year unless relieved sooner by the Commissioner.
Quantity Regulations.-Control of the quantity of celery
sold during a marketing year is provided for by the establish-
ment of a "marketable goal" for the industry and a "marketable
allotment" for the individual producers. The "marketable goal"
is the total number of crates which the industry intends to
market in a marketing year. It is determined prior to the begin-
ning of each season on the basis of an "economic and marketing
survey" conducted by the Celery Advisory Committee and recom-
mended to the Commissioner. With his approval, and agreement
that the recommended quantity is not less than that amount
necessary to supply the market demands of consumers of celery
during the Florida season, the "marketable goal" becomes one
of the factors used in developing "marketable allotments" for
growers.
"Base quantity" is the amount assigned to a producer. It
represents the average number of crates produced by each
grower during the 1960-61 and 1961-62 seasons, and is, for those
growers, a permanent base quantity. The sum of the permanent
base quantities is another factor in developing "marketable
allotments." A base quantity reserve of 21/ percent of the total
permanent base quantities is set aside each year for new growers.
This amount was mandatory for 1963-64 but is permissive in
succeeding seasons.
The "marketable allotment" assigned each grower annually
is the product of a uniform percentage increase or decrease,
derived by dividing the amount fixed as the season's marketable
goal by the total of all permanent base quantities, applied to
each grower's base quantity. Thus each grower is authorized
a maximum number of crates which he may market in a season.
Temporary base quantities are issued to new growers with
certain restrictions: (a) any temporary base quantity issued
out of the reserve shall not be considered in computing the uni-
form percentage, but the uniform percentage shall be applied






Florida Celery Industry


to all base quantities in computing allotments; (b) temporary
base quantities are issued on an annual basis and are renewable
for three years, at which time they become permanent quantities;
(c) not more than 25 percent of the base quantity reserve shall
be assigned to one applicant as a temporary base quantity; (d)
applications must be filed before May 15 of each year.
Other volume control measures the Advisory Committee may
recommend are: (a) regulating the flow-to-market of the
quantity of celery of any grade, size, or quality during specified
periods; (b) limiting or restricting the period during which
celery of a specified grade, size, or quality may be sold or
handled; (c) allotting the quantities (crates) of celery, under
a uniform rule, which each handler may handle during a specified
period or periods; (d) eliminating surplus celery in the field,
under a uniform rule, so it is no longer available for sale. An
exception to the above is made for producers whose season's
"marketable allotment" is 37,500 or fewer crates.
Quality, Pack, and Container Regulations.-The Advisory
Committee may recommend to the Commissioner of Agriculture
that standards of grading, quality, condition, size, maturity, or
pack be established. Uniform inspection, grading, and proper
labeling may also be recommended. It may suggest the size,
weight, capacity, dimensions, or pack of containers used in
packaging, transportation, sale, shipment, or other handling of
celery.
Unfair Trade Practices.-The Advisory Committee may rec-
ommend and the Commissioner may issue and enforce regula-
tions to prohibit unfair trade practices, or to correct any trade
practice deemed to be unfair or detrimental to the purposes of
the Act.
Research Studies and Projects.-The Advisory Committee is
authorized to carry on or contract for such research studies
as it deems desirable, and to expend reasonable amounts of
money for such purposes.
Advertising and Promotion.-The Advisory Committee with
the approval of the Commissioner may establish advertising and
sales promotion programs to create new, or maintain present,
markets for Florida celery, or to prevent or remove trade bar-
riers which obstruct the free flow of celery to market. Individual
brands or trade names may not be promoted.






Florida Celery Industry


to all base quantities in computing allotments; (b) temporary
base quantities are issued on an annual basis and are renewable
for three years, at which time they become permanent quantities;
(c) not more than 25 percent of the base quantity reserve shall
be assigned to one applicant as a temporary base quantity; (d)
applications must be filed before May 15 of each year.
Other volume control measures the Advisory Committee may
recommend are: (a) regulating the flow-to-market of the
quantity of celery of any grade, size, or quality during specified
periods; (b) limiting or restricting the period during which
celery of a specified grade, size, or quality may be sold or
handled; (c) allotting the quantities (crates) of celery, under
a uniform rule, which each handler may handle during a specified
period or periods; (d) eliminating surplus celery in the field,
under a uniform rule, so it is no longer available for sale. An
exception to the above is made for producers whose season's
"marketable allotment" is 37,500 or fewer crates.
Quality, Pack, and Container Regulations.-The Advisory
Committee may recommend to the Commissioner of Agriculture
that standards of grading, quality, condition, size, maturity, or
pack be established. Uniform inspection, grading, and proper
labeling may also be recommended. It may suggest the size,
weight, capacity, dimensions, or pack of containers used in
packaging, transportation, sale, shipment, or other handling of
celery.
Unfair Trade Practices.-The Advisory Committee may rec-
ommend and the Commissioner may issue and enforce regula-
tions to prohibit unfair trade practices, or to correct any trade
practice deemed to be unfair or detrimental to the purposes of
the Act.
Research Studies and Projects.-The Advisory Committee is
authorized to carry on or contract for such research studies
as it deems desirable, and to expend reasonable amounts of
money for such purposes.
Advertising and Promotion.-The Advisory Committee with
the approval of the Commissioner may establish advertising and
sales promotion programs to create new, or maintain present,
markets for Florida celery, or to prevent or remove trade bar-
riers which obstruct the free flow of celery to market. Individual
brands or trade names may not be promoted.






Florida Celery Industry


to all base quantities in computing allotments; (b) temporary
base quantities are issued on an annual basis and are renewable
for three years, at which time they become permanent quantities;
(c) not more than 25 percent of the base quantity reserve shall
be assigned to one applicant as a temporary base quantity; (d)
applications must be filed before May 15 of each year.
Other volume control measures the Advisory Committee may
recommend are: (a) regulating the flow-to-market of the
quantity of celery of any grade, size, or quality during specified
periods; (b) limiting or restricting the period during which
celery of a specified grade, size, or quality may be sold or
handled; (c) allotting the quantities (crates) of celery, under
a uniform rule, which each handler may handle during a specified
period or periods; (d) eliminating surplus celery in the field,
under a uniform rule, so it is no longer available for sale. An
exception to the above is made for producers whose season's
"marketable allotment" is 37,500 or fewer crates.
Quality, Pack, and Container Regulations.-The Advisory
Committee may recommend to the Commissioner of Agriculture
that standards of grading, quality, condition, size, maturity, or
pack be established. Uniform inspection, grading, and proper
labeling may also be recommended. It may suggest the size,
weight, capacity, dimensions, or pack of containers used in
packaging, transportation, sale, shipment, or other handling of
celery.
Unfair Trade Practices.-The Advisory Committee may rec-
ommend and the Commissioner may issue and enforce regula-
tions to prohibit unfair trade practices, or to correct any trade
practice deemed to be unfair or detrimental to the purposes of
the Act.
Research Studies and Projects.-The Advisory Committee is
authorized to carry on or contract for such research studies
as it deems desirable, and to expend reasonable amounts of
money for such purposes.
Advertising and Promotion.-The Advisory Committee with
the approval of the Commissioner may establish advertising and
sales promotion programs to create new, or maintain present,
markets for Florida celery, or to prevent or remove trade bar-
riers which obstruct the free flow of celery to market. Individual
brands or trade names may not be promoted.






Florida Celery Industry


to all base quantities in computing allotments; (b) temporary
base quantities are issued on an annual basis and are renewable
for three years, at which time they become permanent quantities;
(c) not more than 25 percent of the base quantity reserve shall
be assigned to one applicant as a temporary base quantity; (d)
applications must be filed before May 15 of each year.
Other volume control measures the Advisory Committee may
recommend are: (a) regulating the flow-to-market of the
quantity of celery of any grade, size, or quality during specified
periods; (b) limiting or restricting the period during which
celery of a specified grade, size, or quality may be sold or
handled; (c) allotting the quantities (crates) of celery, under
a uniform rule, which each handler may handle during a specified
period or periods; (d) eliminating surplus celery in the field,
under a uniform rule, so it is no longer available for sale. An
exception to the above is made for producers whose season's
"marketable allotment" is 37,500 or fewer crates.
Quality, Pack, and Container Regulations.-The Advisory
Committee may recommend to the Commissioner of Agriculture
that standards of grading, quality, condition, size, maturity, or
pack be established. Uniform inspection, grading, and proper
labeling may also be recommended. It may suggest the size,
weight, capacity, dimensions, or pack of containers used in
packaging, transportation, sale, shipment, or other handling of
celery.
Unfair Trade Practices.-The Advisory Committee may rec-
ommend and the Commissioner may issue and enforce regula-
tions to prohibit unfair trade practices, or to correct any trade
practice deemed to be unfair or detrimental to the purposes of
the Act.
Research Studies and Projects.-The Advisory Committee is
authorized to carry on or contract for such research studies
as it deems desirable, and to expend reasonable amounts of
money for such purposes.
Advertising and Promotion.-The Advisory Committee with
the approval of the Commissioner may establish advertising and
sales promotion programs to create new, or maintain present,
markets for Florida celery, or to prevent or remove trade bar-
riers which obstruct the free flow of celery to market. Individual
brands or trade names may not be promoted.






Florida Agricultural Experiment Stations


Assessments.-The Marketing Order program is financed by
an annual assessment on an equitable basis which may not ex-
ceed 5 cents per crate on first handlers of Florida celery.

Producing Areas and Firms
Areas.-Production of celery is confined to two major and
two minor producing areas, all of which are in the peninsular
portion of the state (Figure 2).
The Belle Glade area, located in the muck soils on the south-
eastern shores of Lake Okeechobee in western Palm Beach
County, is the major area of production. During the 1962-63
season 5,500 acres of winter celery and 2,900 acres of spring
celery were planted. Of that total 8,370 acres were available
for harvest, yielding 5,864,000 crates of which 5,588,000 crates
were sold (Table 1).
The Central Florida area, second in importance, embraces
parts of Lake, Orange, and Seminole counties. Celery is pro-
duced on both muck and sand land. In 1962-63 830 acres of
winter celery and 1,330 acres of spring celery were planted in
this area. Of the total, 2,010 acres were available for harvest,
yielding 1,120,000 crates of which 1,074,000 crates were sold.
The West Florida area produces celery on a pocket of muck
soil in Sarasota County about seven miles east of the city of
Sarasota. This area produced 320 acres for winter and 50 acres
for spring harvest. Of the 296,000 crates available, 266,000 were
sold in 1962-63.
The smallest area, North Florida, produces celery on muck
land in the southeastern portion of Alachua County. There 50
acres were planted for winter and 320 acres for spring harvest.
Of that total, 370 acres were available for harvest, producing
296,000 crates of which 266,000 were sold in 1962-63.

Firms.-In general, firms producing celery in the Belle Glade
area were medium to large in size, while those of the other pro-
ducing areas were of small to medium size.6 For purposes of
analysis here, all areas have been combined in Table 2. The 49
grower allotments in 1962-63 were combined by corporate or
partnership arrangements into 42 separate producing firms.
6 Size classifications were as follows: Large-500 or more acres; Medium
-100 to 499 acres; Small-1 to 99 acres. Average firm size was 916, 243,
and 36 acres, respectively.






Florida Agricultural Experiment Stations


Assessments.-The Marketing Order program is financed by
an annual assessment on an equitable basis which may not ex-
ceed 5 cents per crate on first handlers of Florida celery.

Producing Areas and Firms
Areas.-Production of celery is confined to two major and
two minor producing areas, all of which are in the peninsular
portion of the state (Figure 2).
The Belle Glade area, located in the muck soils on the south-
eastern shores of Lake Okeechobee in western Palm Beach
County, is the major area of production. During the 1962-63
season 5,500 acres of winter celery and 2,900 acres of spring
celery were planted. Of that total 8,370 acres were available
for harvest, yielding 5,864,000 crates of which 5,588,000 crates
were sold (Table 1).
The Central Florida area, second in importance, embraces
parts of Lake, Orange, and Seminole counties. Celery is pro-
duced on both muck and sand land. In 1962-63 830 acres of
winter celery and 1,330 acres of spring celery were planted in
this area. Of the total, 2,010 acres were available for harvest,
yielding 1,120,000 crates of which 1,074,000 crates were sold.
The West Florida area produces celery on a pocket of muck
soil in Sarasota County about seven miles east of the city of
Sarasota. This area produced 320 acres for winter and 50 acres
for spring harvest. Of the 296,000 crates available, 266,000 were
sold in 1962-63.
The smallest area, North Florida, produces celery on muck
land in the southeastern portion of Alachua County. There 50
acres were planted for winter and 320 acres for spring harvest.
Of that total, 370 acres were available for harvest, producing
296,000 crates of which 266,000 were sold in 1962-63.

Firms.-In general, firms producing celery in the Belle Glade
area were medium to large in size, while those of the other pro-
ducing areas were of small to medium size.6 For purposes of
analysis here, all areas have been combined in Table 2. The 49
grower allotments in 1962-63 were combined by corporate or
partnership arrangements into 42 separate producing firms.
6 Size classifications were as follows: Large-500 or more acres; Medium
-100 to 499 acres; Small-1 to 99 acres. Average firm size was 916, 243,
and 36 acres, respectively.






Florida Agricultural Experiment Stations


Assessments.-The Marketing Order program is financed by
an annual assessment on an equitable basis which may not ex-
ceed 5 cents per crate on first handlers of Florida celery.

Producing Areas and Firms
Areas.-Production of celery is confined to two major and
two minor producing areas, all of which are in the peninsular
portion of the state (Figure 2).
The Belle Glade area, located in the muck soils on the south-
eastern shores of Lake Okeechobee in western Palm Beach
County, is the major area of production. During the 1962-63
season 5,500 acres of winter celery and 2,900 acres of spring
celery were planted. Of that total 8,370 acres were available
for harvest, yielding 5,864,000 crates of which 5,588,000 crates
were sold (Table 1).
The Central Florida area, second in importance, embraces
parts of Lake, Orange, and Seminole counties. Celery is pro-
duced on both muck and sand land. In 1962-63 830 acres of
winter celery and 1,330 acres of spring celery were planted in
this area. Of the total, 2,010 acres were available for harvest,
yielding 1,120,000 crates of which 1,074,000 crates were sold.
The West Florida area produces celery on a pocket of muck
soil in Sarasota County about seven miles east of the city of
Sarasota. This area produced 320 acres for winter and 50 acres
for spring harvest. Of the 296,000 crates available, 266,000 were
sold in 1962-63.
The smallest area, North Florida, produces celery on muck
land in the southeastern portion of Alachua County. There 50
acres were planted for winter and 320 acres for spring harvest.
Of that total, 370 acres were available for harvest, producing
296,000 crates of which 266,000 were sold in 1962-63.

Firms.-In general, firms producing celery in the Belle Glade
area were medium to large in size, while those of the other pro-
ducing areas were of small to medium size.6 For purposes of
analysis here, all areas have been combined in Table 2. The 49
grower allotments in 1962-63 were combined by corporate or
partnership arrangements into 42 separate producing firms.
6 Size classifications were as follows: Large-500 or more acres; Medium
-100 to 499 acres; Small-1 to 99 acres. Average firm size was 916, 243,
and 36 acres, respectively.






Florida Agricultural Experiment Stations


Assessments.-The Marketing Order program is financed by
an annual assessment on an equitable basis which may not ex-
ceed 5 cents per crate on first handlers of Florida celery.

Producing Areas and Firms
Areas.-Production of celery is confined to two major and
two minor producing areas, all of which are in the peninsular
portion of the state (Figure 2).
The Belle Glade area, located in the muck soils on the south-
eastern shores of Lake Okeechobee in western Palm Beach
County, is the major area of production. During the 1962-63
season 5,500 acres of winter celery and 2,900 acres of spring
celery were planted. Of that total 8,370 acres were available
for harvest, yielding 5,864,000 crates of which 5,588,000 crates
were sold (Table 1).
The Central Florida area, second in importance, embraces
parts of Lake, Orange, and Seminole counties. Celery is pro-
duced on both muck and sand land. In 1962-63 830 acres of
winter celery and 1,330 acres of spring celery were planted in
this area. Of the total, 2,010 acres were available for harvest,
yielding 1,120,000 crates of which 1,074,000 crates were sold.
The West Florida area produces celery on a pocket of muck
soil in Sarasota County about seven miles east of the city of
Sarasota. This area produced 320 acres for winter and 50 acres
for spring harvest. Of the 296,000 crates available, 266,000 were
sold in 1962-63.
The smallest area, North Florida, produces celery on muck
land in the southeastern portion of Alachua County. There 50
acres were planted for winter and 320 acres for spring harvest.
Of that total, 370 acres were available for harvest, producing
296,000 crates of which 266,000 were sold in 1962-63.

Firms.-In general, firms producing celery in the Belle Glade
area were medium to large in size, while those of the other pro-
ducing areas were of small to medium size.6 For purposes of
analysis here, all areas have been combined in Table 2. The 49
grower allotments in 1962-63 were combined by corporate or
partnership arrangements into 42 separate producing firms.
6 Size classifications were as follows: Large-500 or more acres; Medium
-100 to 499 acres; Small-1 to 99 acres. Average firm size was 916, 243,
and 36 acres, respectively.

















North Florida


Figure 2.-Celery producing areas in Florida, 1962-63 season.


Florida Celery Industry


Sarasota








Florida Agricultural Experiment Stations


TABLE 1.-Acreage and production of celery, by area and season, Florida,
1962-63 season.


Acreage Yield Production
Area Per
Planted Harvested Acre Total Sold


Acres Acres Crates


Crates Crates


North Florida
Central Florida
West Florida
Belle Glade


Total 6,700 6,600


North Florida
Central Florida
West Florida
Belle Glade


320
1,330
50
2,900


300
1,280
50
2,870


Total 4,600 4,500


717 4,730,000 4,507,000


Spring

650
595
485
625


195,000
762,000
24,000
1,794,000


174,000
735,000
24,000
1,692,000


617 2,775,000 2,625,000


North Florida
Central Florida
West Florida
Belle Glade


370
2,160
370
8,400


State total 11,300


350
2,010
370
8,370


11,100


All Seasons

643 225,000
557 1,120,000
800 296,000
701 5,864,000


676 7,505,000 7,132,000


Source: USDA, AMS, Florida Crop and Livestock Reporting Service, Florida Agricultural
Statistics, Vegetable Summary, 1968 Issue, Orlando, Florida, pp. 28-29.



Eighteen firms, 42.8 percent, produced 94.3 percent of the celery
in Florida.

Yields were higher for large and medium than for small firms.
However, there is some evidence that these differences may have
been due to soil type as well as to firm size. Although firm size
within an area was important, there were no medium or large
firms producing sand land celery.


50
830
320
5,500


50
730
320
5,500


Winter

605
490
850
740


30,000
358,000
272,000
4,070,000


30,000
339,000
242,000
3,896,000


204,000
1,074,000
266,000
5,588,000







Florida Celery Industry


TABLE 2.-Characteristics of Florida celery firms, by firm size, number, acreage,
production, and yield, 1962-63 season.

Firm Proportion of Average
Sizet Firms Firms Acreage Production Yield Per
Acre
No. Percent Percent Percent Crates
Large 9 21.4 73.0 78.7 695
Medium 9 21.4 19.3 15.6 606
Small 24 57.2 6.7 5.7 539
Total or average 42 100.0 100.0 100.0 681
t Large-500 or more acres; Medium-100 to 499 acres; Small-1 to 99 acres.
Source: Celery Advisory Committee records.


Shipping Areas
Celery shipping areas are similar to those of production:
(a) the Belle Glade area; (b) the Central Florida area; (c) the
West Florida area; and (d) the North Florida area. However,
because of the small number of sales firms and the fact that less
than 400 acres were produced in each, the West and North
Florida areas have been combined in discussions throughout this
publication and are referred to as the West Florida area.
Twelve of the 14 authorized sales firms were included in the
sample of organizations from which data for this study were
obtained.7 One firm in the Belle Glade area and one firm which
produced both in the Central Florida and Belle Glade areas were
omitted from this study for lack of adequate invoice data. The
sample represented approximately 10 percent of the total ship-
ments of firms sampled and 9 percent of the total shipments from
Florida in 1962-63. Data in Table 3 and all following tables in-
clude only sizes 11/2 through XX unless otherwise noted. Data
for sizes 1 and 2 dozen hearts were omitted from all tables unless
specified.
The percentage of value of the crates sampled was slightly
greater than percentage of volume sampled in both the Belle
Glade and West Florida areas. This was reflected also in the
average price per crate received in the three areas. It was caused
by the relative distribution of shipments throughout the season
from the respective areas.

STwo of the authorized sales firms were combined to avoid disclosure.
All tables include data from 12 sales offices reported as 11 firms.







Florida Agricultural Experiment Stations


TABLE 3.-Number and percentage of crates and value of celery sampled, and
average price per crate, by shipping area, 11 Florida sales firms,
1962-63 season.
Average
Shipping Area Crates Sampled Value of Crates Sampled Price
Number Percent Dollars Percent Dollars

Belle Glade 508,005 79.9 1,088,549 80.5 2.14
Central Florida 75,834 11.9 151,443 11.2 2.00
West Florida 52,433 8.2 112,120 8.3 2.14
Total or average 636,272 100.0 1,352,112 100.0 2.13

Weekly Shipments.-Shipments from the Belle Glade and
Central Florida areas began the first week of November 1962,
while shipments from the West Florida area did not begin until
the last week of January 1963. Shipments from Florida con-
tinued throughout the season ending the first week of July 1963.
Peak movement months during the Florida season were Febru-
ary, March and April (Figure 3).
Shipments from the Belle Glade area were continuous
throughout the Florida season, reaching a peak the week of
March 3, when 5.5 percent of the total Belle Glade volume was
shipped. Unlike the Belle Glade area, or the state as a whole, the
Central Florida peak season occurred during the last three
months of the Florida season.
Peak shipments began from the West Florida area the middle
of February and continued throughout April. A second, but
relatively smaller, peak was reached during the first three weeks
of May.

Weekly Prices.-Weekly average prices received for celery
from the Belle Glade area tended to correspond to the average
price for all areas most closely (Figure 4). This is logical, since
the bulk of the celery marketed was from the Belle Glade area.
Grades, sizes, and types of sale in that area had the greatest
effect on the average price in all areas.
When average weekly prices and shipments were plotted to
examine price-quantity relationships, average weekly prices per
crate for all shipments reacted inversely to changes in weekly
volume. It was evident also that there were three fairly distinct
price periods: (a) the first six weeks, (b) the middle 21 weeks,
and (c) the last eight weeks of the 1962-63 Florida season. These







Florida Agricultural Experiment Stations


TABLE 3.-Number and percentage of crates and value of celery sampled, and
average price per crate, by shipping area, 11 Florida sales firms,
1962-63 season.
Average
Shipping Area Crates Sampled Value of Crates Sampled Price
Number Percent Dollars Percent Dollars

Belle Glade 508,005 79.9 1,088,549 80.5 2.14
Central Florida 75,834 11.9 151,443 11.2 2.00
West Florida 52,433 8.2 112,120 8.3 2.14
Total or average 636,272 100.0 1,352,112 100.0 2.13

Weekly Shipments.-Shipments from the Belle Glade and
Central Florida areas began the first week of November 1962,
while shipments from the West Florida area did not begin until
the last week of January 1963. Shipments from Florida con-
tinued throughout the season ending the first week of July 1963.
Peak movement months during the Florida season were Febru-
ary, March and April (Figure 3).
Shipments from the Belle Glade area were continuous
throughout the Florida season, reaching a peak the week of
March 3, when 5.5 percent of the total Belle Glade volume was
shipped. Unlike the Belle Glade area, or the state as a whole, the
Central Florida peak season occurred during the last three
months of the Florida season.
Peak shipments began from the West Florida area the middle
of February and continued throughout April. A second, but
relatively smaller, peak was reached during the first three weeks
of May.

Weekly Prices.-Weekly average prices received for celery
from the Belle Glade area tended to correspond to the average
price for all areas most closely (Figure 4). This is logical, since
the bulk of the celery marketed was from the Belle Glade area.
Grades, sizes, and types of sale in that area had the greatest
effect on the average price in all areas.
When average weekly prices and shipments were plotted to
examine price-quantity relationships, average weekly prices per
crate for all shipments reacted inversely to changes in weekly
volume. It was evident also that there were three fairly distinct
price periods: (a) the first six weeks, (b) the middle 21 weeks,
and (c) the last eight weeks of the 1962-63 Florida season. These








Florida Celery Industry 15


Percent
5
4
3
2
Belle Glade



1 1



7 Central Florida
6
5
4
3






7
6
5
4
3
2 West Florida







2
All Areas

4 18 2 16 30 13 27 10 24 10 24 7 21 5 19 2 16 30
Nov. Dec. Jan. Feb. Mar. Apr. May June
Weeks Beginning

Figure 3.-Percentage of volume shipped weekly, by area, I I Florida sales firms,
1962-63 season.



data suggested a possible shift in the level of demand for Florida
celery from one period to the next. Demand in period "a" was
lower than in period "b" or "c." Demand in period "b" was
greater than in period "c." Using weekly average prices as the
dependent variable and weekly volume sampled as the independ-
ent variable, the data for each of the three periods were analyzed








Florida Agricultural Experiment Stations


2.75
2.50
2.25
2.00
1.75
1.50 Central Florida



2.75
2.50

2.25
2.00
1.75
1.50
West Florida
1.25 .
OT IIsellllllllleslassallllllllrlall


Nov. Dec. Jan. Feb. Mar. Apr. May June
Weeks Beginning

Figure 4.-Weekly overage price, by shipping area, 11 Florida sales firms,
1962-63 season.

by simple linear regression methods, and estimates of the co-
efficients (slopes of the three regression lines) were made.8
Appropriate tests made for the goodness of fit of each regression
line to the data indicated significance at the 95 percent confi-
dence level.

8 See Appendix for statistical analysis and tests of significance.







Florida Celery Industry


From inspection of the regression coefficients and the regres-
sion lines drawn, the slopes (regression coefficients) of the three
regression lines were practically identical. The covariance tech-
nique was used to test for significant differences between the
three previous regression coefficients and to test for a significant
difference in the elevation of the three regression lines. It was
found that the common regression coefficient or slope provided
a valid estimate of the relationship which existed between
weekly price and quantity. The second test resulted in a signifi-
cant difference in the elevations of the three regression lines,
indicating a change in demand had occurred during the three
periods analyzed.
The resulting inverse relationship can be described as the
change in weekly average price resulting from a change in
weekly volume. The change in price due to a change in Florida
weekly volume is equal to the common regression coefficient
times the change in weekly volume. The common regression
coefficient for the 1962-63 data of -.000004 indicated a negatively
sloping line where price changed inversely $0.000004 per crate
with each crate change in weekly volume. Thus, a 4 cent per
crate increase in average price would occur when weekly volume
decreased 10,000 crates. Weekly average price would decrease
a similar amount when weekly volume increased 10,000 crates.
The reaction of price to changes in volume, as described
above, shows the inverse relationship of volume and price. How-
ever, several factors not contained within the data may help to
explain the variation in the Y-intercepts of the regression lines
(6). Changes in California supply, the total supply of salad
vegetables, and perhaps climatic conditions in Florida and in
consuming areas tend to modify the effect of changes in Florida
supply on the Florida price.
Sizes of Celery.-There are eight basic sizes of celery-11/2,
2, 21/2, 3, 4, 6, 8, and XX. The number indicates the number of
dozens of stalks packed per crate. Crates which contain more
than eight dozen stalks of celery are grouped together, called
size XX, and are sold as one size. Several firms packed two
celery stalks in cellophane bags and sold them as hearts. There
were two sizes of hearts-1 and 2 dozen sizes-each containing
the number of packages their name implies.
During the 1962-63 season 30.3 percent of the total volume
of sizes 11/ through XX were size 21/2. Size 3 was the next most







Florida Agricultural Experiment Stations


important, accounting for 28.7 percent of the total volume.
Sizes 2 and 4 accounted for 19.3 and 14.2 percent of the total
volume, respectively. Those four sizes made up 92.5 percent of
the total volume shipped (Table 4).
A marked difference in sizes by area is evident in Table 4
when a comparison of the percentage from each area by sizes
is made with the average percentage of all sizes from each
area. The Belle Glade area showed a larger percentage of sizes
11/ through 3 than the average percentage of all sizes from the
area. A smaller percentage of the larger sizes was produced in
the Central Florida area. Production by sizes in the West Florida
area showed no definite trend to a greater percentage for the
larger or smaller sizes.
The distribution of celery hearts among the three areas
indicated a greater volume packaged in the Belle Glade area.
The volume of hearts packaged in each area is governed by the
number and size of firms which package hearts. Not all firms
in all areas, or any one area, package hearts. Furthermore, a
disproportionate number of firms in each area engaged in heart
packaging. As a result, heart shipments varied widely from
the average volume from each area.
Average price per crate by sizes and shipping areas varied
greatly during the 1962-63 season, ranging from a low of $1.40
per crate for size 11/2 celery to a high of $2.30 per crate for the
XX size. Sizes 21/2 and 3, which represented 59.0 percent of the
total volume, averaged $2.17 and $2.16 per crate, respectively.
Average prices by sizes in the Belle Glade area and the West
Florida area were generally higher than the prices received in
the Central Florida area.

Authorized Sales Firms
Three classifications by sizes were established for the sales
firms. Those firms which handled 10 percent or more of the
total volume sampled were grouped together and are referred
to as large firms, medium firms 5 to 9.9 percent, and small firms,
those handling less than 5 percent of the total volume sampled.
During the 1962-63 season, the four large firms shipped 64.0
percent of the volume sampled. The four medium firms shipped
29.8 percent, and the three small firms 6.2 percent. The percent-
age distribution of value sampled between firm size followed
closely that for the total volume. Only slight variations were








TABLE 4.-Percentage of sampled volume sold and average price per crate, by size of celery in various shipping areas, 11 Florida
sales firms, 1962-63 season.



Shipping Size of Celery 1 doz. 2 doz. Avg.
Area 11/ 2 2/2 3 4 6 8 XX Hearts Hearts 1/2-XX


Belle Glade
Central Florida
West Florida


Total
Percent
by size 1%-XX


Percent

84.1 81.2 82.7 80.4 73.9 71.6 45.1 100.0 78.5 87.0 79.9
9.0 10.5 7.8 12.6 17.6 20.2 48.8 21.5 8.9 11.9
6.9 8.3 9.5 7.0 8.5 8.2 6.1 4.1 8.2


100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0 100.0


1.1 19.3 30.3 28.7 14.2


5.2 .6 .6 -


- 100.0


Dollars Per Crate

Belle Glade 1.69 2.09 2.17 2.17 2.06 2.32 2.24 2.30 2.04 3.34 2.14
Central Florida 1.50 1.96 2.07 2.06 1.85 2.06 2.02 1.76 2.83 2.00
West Florida 1.40 2.00 2.18 2.23 2.08 2.22 2.29 2.97 2.14

Average price
by size 1.65 2.07 2.17 2.16 2.02 2.26 2.14 2.30 1.98 3.28 2.13


<-t







Florida Agricultural Experiment Stations


detected in the medium and small firm groups. These differences
were more accurately reflected in the average price per crate
received by the individual firm groups (Table 5).

TABLE 5.-Number and percentage of crates and value of celery sampled, and
average price per crate, by firm size, 11 Florida sales firms, 1962-63
season.
Average
Crates Sampled Value of Crates Sampled Price
Firm Size -
Number Percent Dollars Percent Dollars

Large 407,557 64.0 867,084 64.1 2.13
Medium 189,356 29.8 406,001 30.0 2.14
Small 39,359 6.2 79,027 5.9 2.01
Total or
average 636,272 100.0 1,352,112 100.0 2.13


MARKETING CELERY

Bases of Sale
Five bases of sale-FOBAF, FOBIAA, Delivered, Consigned,
and Price Arrival-were used in marketing Florida celery in the
1962-63 season. FOBAF sales, as used in this study, means that
the celery was loaded "free on board" the conveyance at the
shipping point. The price quoted applied at shipping point. The
buyer bore the risk of goods in transit and paid the transporta-
tion charges. The buyer relinquished his right of inspection
at destination for the purpose of determining that the goods
were as ordered at the time of shipment. A small price reduction
was given for the assumption of risk by the buyer.
FOBIAA sales means that the celery was loaded "free on
board" the conveyance at shipping point. The price quoted
applied at shipping point. The buyer bore the risk of goods in
transit and paid the transportation charges. The buyer had the
right of inspection at destination for the purpose of determining,
before acceptance, that the goods were as ordered at time of
shipment and had arrived in good condition.
Delivered sales means that the shipper had the celery de-
livered to the destination specified by the buyer. The shipper
paid the transportation charges and assumed all risks in transit,







Florida Agricultural Experiment Stations


detected in the medium and small firm groups. These differences
were more accurately reflected in the average price per crate
received by the individual firm groups (Table 5).

TABLE 5.-Number and percentage of crates and value of celery sampled, and
average price per crate, by firm size, 11 Florida sales firms, 1962-63
season.
Average
Crates Sampled Value of Crates Sampled Price
Firm Size -
Number Percent Dollars Percent Dollars

Large 407,557 64.0 867,084 64.1 2.13
Medium 189,356 29.8 406,001 30.0 2.14
Small 39,359 6.2 79,027 5.9 2.01
Total or
average 636,272 100.0 1,352,112 100.0 2.13


MARKETING CELERY

Bases of Sale
Five bases of sale-FOBAF, FOBIAA, Delivered, Consigned,
and Price Arrival-were used in marketing Florida celery in the
1962-63 season. FOBAF sales, as used in this study, means that
the celery was loaded "free on board" the conveyance at the
shipping point. The price quoted applied at shipping point. The
buyer bore the risk of goods in transit and paid the transporta-
tion charges. The buyer relinquished his right of inspection
at destination for the purpose of determining that the goods
were as ordered at the time of shipment. A small price reduction
was given for the assumption of risk by the buyer.
FOBIAA sales means that the celery was loaded "free on
board" the conveyance at shipping point. The price quoted
applied at shipping point. The buyer bore the risk of goods in
transit and paid the transportation charges. The buyer had the
right of inspection at destination for the purpose of determining,
before acceptance, that the goods were as ordered at time of
shipment and had arrived in good condition.
Delivered sales means that the shipper had the celery de-
livered to the destination specified by the buyer. The shipper
paid the transportation charges and assumed all risks in transit,







Florida Celery Industry


other than normal damage. Transfer of title to the celery took
place at destination, but the sales price was usually established
before shipment. The buyer had the right of inspection at desti-
nation for the purpose of determining, before acceptance, that
the goods were as ordered at time of shipment and arrived in
good condition.
Consigned sales means the celery was shipped to a wholesale-
receiver, jobber, or other type of terminal wholesale handler to
be sold for the account of the shipper who, in the meantime,
maintained title to the celery. The shipper paid the transporta-
tion, terminal, and commission charges and assumed the risk
of loss in transit.
Price Arrival sales applied to an arrangement between the
shipper and buyer, whereby the shipper sent the celery to the
destination, bearing all transportation costs and risks involved.
The buyer inspected the celery on arrival, and a price was
mutually agreed upon. Under such a sale the buyer and seller
usually had a previously arranged working agreement.
The three major bases of sale used during the 1962-63 season
were FOBIAA, FOBAF, and Delivered, accounting for 92.6
percent of the total volume sampled (Table 6).
A comparison of percentage columns of Table 6 indicated a
greater percentage of value than of volume for the three most
important bases of sale. This was reflected in the average price
per crate. The three major bases of sale resulted in greater than
average prices, with only that for FOBIAA sales being sub-
stantially higher than the average price per crate for all bases
of sale. Consigned and Price Arrival sales resulted in substan-
tially lower average prices than the over-all average.

TABLE 6.-Percentage of volume and value sampled and average price per
crate, by basis of sale, 11 Florida sales firms, 1962-63 season.
Percent of Average
Basis of Price
Sale Volume Value Per Crate
Dollars
FOBAF 35.0 35.3 2.14
FOBIAA 43.9 44.7 2.17
Delivered 13.7 13.8 2.14
Consigned 7.2 6.0 1.75
Price Arrival .2 .2 1.73
Total or average 100.0 100.0 2.13







Florida Agricultural Experiment Stations


Shipping Areas.-As a proportion of total sales by basis of
sale, shipments from the Belle Glade area ranged from 51.1
percent of all Consigned sales to 93.4 percent of all the FOBAF
sales (Table 7). FOBAF and Price Arrival sales showed a
greater percentage of the total shipments made by these bases
of sale than the percentage of all bases from the area. Delivered
sales were slightly higher than average, but FOBIAA sales were
5.9 percent lower and Consigned sales were 28.8 percent lower
than average. Consigned sales were more than twice the per-
centage of the average of shipments by all bases of sale from
the Central Florida area. FOBIAA and Delivered sales were
also slightly higher than the average. Little or no celery was
shipped from the West Florida area on an FOBAF or Price
Arrival basis. Delivered sales were less than the average for
all bases, while FOBIAA and Consigned sales were well above
the average of 8.2 percent.
Although average prices for the three major bases of sale in
the Belle Glade area showed no substantial differences, prices
for Consigned and Price Arrival sales were much lower than
the average for the three major bases of sale. Similarly, there

TABLE 7.-Percentage of volume sold and average price per crate, by basis of
sale in various shipping areas, 11 Florida sales firms, 1962-63 season.

Shipping Area
Basis of Total or Average
Sale Belle Central West by
Glade Florida Florida Basis of Sale
Percent
FOBAF 93.4 7.4 .2 100.0
FOBIAA 74.0 12.4 13.6 100.0
Delivered 81.6 13.1 5.3 100.0
Consigned 51.1 28.6 20.3 100.0
Price Arrival 90.6 9.4 100.0
Percent by
area 79.9 11.9 8.2 100.0
Dollars Per Crate
FOBAF 2.16 2.00 2.00 2.14
FOBIAA 2.18 2.04 2.21 2.17
Delivered 2.16 2.03 2.13 2.14
Consigned 1.65 1.86 1.85 1.75
Price Arrival 1.69 2.14 1.73
Average by
area 2.14 2.00 2.14 2.13







Florida Celery Industry


were no great differences in the average prices received for the
three major bases of sale in the Central Florida area. Consigned
sales returned the lowest average price of all bases of sale, while
Price Arrival sales returned the highest average price. There
was greater variation in prices received by bases of sale in the
West Florida area.

Sizes of Firms.-Among all firms FOBIAA sales were used
for the greatest percentage of volume sold. FOBAF type sales
were second in importance and Delivered sales third (Table 8).
A comparison of firm size and basis of sale reveals several in-
teresting differences. First, only large firms had a greater pro-
portion of sales made on an FOBAF and Delivered basis than
the average for all firms. Second, only large firms made sales
on a Price Arrival basis. Third, medium and small firms sold
a greater percentage of celery on an FOBIAA basis than the
average of all firms. Fourth, small firms showed a considerably
greater percentage of Consigned sales than other firms or the
average of all firms. Fifth, as firm size decreased, (a) the per-
centage of FOBAF sales decreased, (b) the percentage of FOB-
IAA sales tended to increase, (c)o the percentage of Delivered

TABLE 8.-Percentage of volume sold and average price per crate, by basis of
sale for various size firms, 11 Florida sales firms, 1962-63 season.

Size of Firm
Basis of e o F Average by
Sale Large Medium Small Basis of Sale
Percent
FOBAF 40.9 25.8 18.1 35.0
FOBIAA 38.2 55.0 48.9 43.9
Delivered 15.0 12.5 5.8 13.7
Consigned 5.6 6.7 27.2 7.2
Price Arrival .3 .2
Total 100.0 100.0 100.0 100.0
Dollars Per Crate
FOBAF 2.14 2.17 2.02 2.14
FOBIAA 2.16 2.18 2.13 2.17
Delivered 2.12 2.20 2.02 2.14
Consigned 1.81 1.62 1.79 1.75
Price Arrival 1.73 1.73
Average by
size 2.13 2.14 2.01 2.13







Florida Agricultural Experiment Stations


sales decreased, and (d) the percentage of Consigned sales in-
creased.
Average price per crate by each basis of sale indicated a
higher price for all bases of sale except Consigned for medium
firms. The average price per crate received by the large firms
was higher for each basis of sale than the prices received by
small firms. Except for the average price received for Con-
signed sales, small firms received a lower price for each basis
of sale when compared with the average for all firms.
Weekly Shipments.-Weekly shipments of celery from Flor-
ida by bases of sale varied by each basis of sale. Volume of
FOBAF sales was relatively stable from the week beginning
January 20, 1963, through the week beginning May 19, 1963
(Table 9). No peak periods are evident after January 13, 1963,
for the FOBAF sales. There were a few individual weeks of
high or low volume. The peak periods of shipments for the
FOBIAA and Delivered bases were during the months of Febru-
ary, March, and April. Little celery was shipped on a Consigned
basis before the second week in January. Heaviest movement
on a Consigned basis occurred in late March, early April, and
again in May. Price Arrival sales, not included in the figure,
were irregular over the season, with the greatest concentration
occurring during the month of May.
A comparison of the weekly percentage for each basis of sale
with the weekly percentage for all bases of sale (Table 9) as
price increased or decreased (Table 10) resulted in a few notice-
able differences. With an increasing or decreasing weekly aver-
age price the fluctuations of Delivered and Consigned sales were
greater than those for other bases of sale from the average
weekly volume by all bases of sale. The magnitude of the fluc-
tuations was greatest for Consigned sales. The percentage of
FOBIAA sales moved most consistently with the percentage for
all bases of sale, tending to move more rapidly upward or down-
ward in the direction opposite to changes in average weekly
prices.
A second comparison was made between the average price
for each basis of sale and the average for all bases of sale on a
weekly basis. For FOBIAA, FOBAF, and Delivered sales, aver-
age weekly prices were higher than the average for all bases of
sale when the latter average price was above or below $2.00 per
crate. The range in average prices by the above types of sale








Florida Celery Industry


TABLE 9.-Percentage of volume shipped weekly, by
sales firms, 1962-63 season.


basis of sale,t 11 Florida


~Week Basis of Sale Average
Beginning FOBAF FOBIAA Delivered Consigned by Week
Beginning FOBAF FOBIAA Delivered Consigned by Week


Nov. 4
11
18
25

Dec. 2
9
16
23
30

Jan. 6
13
20
27

Feb. 3
10
17
24

March 3
10
17
24
31

April 7
14
21
28

May 5
12
19
26

June 2
9
16
23
30

Total


Percent

.2
.7
.5
1.0


100.0


100.0


100.0


100.0


.3
.7
1.0
1.5

2.5
2.9
3.7
2.3
2.1

2.6
3.8
3.4
3.0

3.9
4.6
4.0
4.0

5.1
4.5
3.7
3.8
4.8

4.1
3.4
2.9
3.4

3.8
2.8
3.9
2.4

1.8
1.6
1.2
.5


100.0


t Does not include celery sold on a Price Arrival basis since less than two-tenths of
1 percent was sold on that basis.
t Less than one-tenth of 1 percent.








Florida Agricultural Experiment Stations


TABLE 10.-Weekly average price per crate, by basis
firms, 1962-63 season.


of sale.t 11 Florida sales


Week Basis of Sale Average
Week Average
Beginning FOBAF FOBIAA Delivered Consigned by Week

Dollars Per Crate


Nov. 4
11
18
25

Dec. 2
9
16
23
30

Jan. 6
13
20
27

Feb. 3
10
17
24

March 3
10
17
24
31

April 7
14
21
28

May 5
12
19
26

June 2
9
16
23
30
Average by
basis of
sale


2.32
2.03
1.92
1.45

1.35
1.35
2.56
2.75
2.86

2.60
2.31
2.23
2.24

2.24
2.71
2.86
2.37

1.92
2.02
1.93
1.93
1.96

1.94
2.29
2.38
2.20

2.02
1.99
1.95
1.91

1.91
2.17
2.27
2.21


2.29
2.45
1.95
1.46

1.30
1.32
2.48
2.75
2.78

2.57
2.20
2.25
2.25

2.25
2.66
2.84
2.21

1.93
1.94
1.92
2.05
1.94

1.92
2.40
2.35
2.15

2.00
1.96
1.87
1.93

1.98
2.47
2.12


2.34
2.13
1.95
1.47

1.33
1.33
2.56
2.73
2.79

2.57
2.21
2.20
2.22

2.24
2.70
2.80
2.32

1.91
1.94
1.91
1.90
1.91

1.90
2.30
2.37
2.13

1.93
1.91
1.86
1.82

1.86
2.21
2.10
2.39
2.83


t Does not include celery sold
1 percent was sold on that basis.


on a Price Arrival basis since less than two-tenths of







Florida Celery Industry


was from 1 cent to 31/2 cents per crate higher than the average
weekly price for all bases of sale. On the other hand, there was
a marked difference in weekly average Consigned sale prices
when the average weekly price for all bases of sale was above
or below $2.00 per crate. When the average weekly price for
all bases of sale was above $2.00, the weekly Consigned price
averaged 7 cents lower. When the average weekly price for all
bases of sale was below $2.00, the weekly Consigned price aver-
aged $0.27 per crate lower. Only during six of the 29 weeks in
which Consigned sales were made was the average Consigned
price equal to or greater than the average weekly price for all
bases of sale. Those instances occurred during periods of in-
creasing prices.

Sizes of Celery.-Over one-third of the FOBAF sales con-
sisted of size 3 dozen celery. The next most important sizes for
this basis of sale were 21/ and 4 dozen (Table 11). Of the FOB-
IAA sales, size 21. was the most prevalent, followed by sizes
3 and 2, respectively. Size 21/ dozen accounted for about one-
third of the Delivered and Consigned sales with sizes 2 and 3
dozen second and third in importance. Only four sizes were sold
on a Price Arrival basis, with size 4 dozen accounting for more
than one-half of all such sales.
There were considerable differences in the average prices of
the more common sizes sold on an FOBAF basis. Smaller sizes,
6, 8, and XX dozen, sold at a premium over all other sizes.
Average prices by sizes for sales on an FOBIAA basis indicated
the same distribution within a narrower range as those sales on
an FOBAF basis. For Delivered and Consigned sales, sizes 2
21, and 3 dozen returned the highest prices among the more
common sizes. A price premium was indicated for the XX size
under Delivered sales and size 11/ for Consigned sales (Table 11).
The smaller sizes returned a lower price than the larger sizes
when sold on a Consigned basis. Average price per crate by
sizes and all bases of sale tended to be higher for the smaller
sizes. Only sizes 4 and 8 dozen did not follow the general pattern
of increased price per crate as size decreased.

Types of Buyers.-Wholesale-receivers, brokers, and chains
bought 80.8 percent of the celery sold on an FOBAF basis." Of
these, only brokers bought more celery on an FOBAF basis than
o Types of buyers are defined on page 33.







Florida Celery Industry


was from 1 cent to 31/2 cents per crate higher than the average
weekly price for all bases of sale. On the other hand, there was
a marked difference in weekly average Consigned sale prices
when the average weekly price for all bases of sale was above
or below $2.00 per crate. When the average weekly price for
all bases of sale was above $2.00, the weekly Consigned price
averaged 7 cents lower. When the average weekly price for all
bases of sale was below $2.00, the weekly Consigned price aver-
aged $0.27 per crate lower. Only during six of the 29 weeks in
which Consigned sales were made was the average Consigned
price equal to or greater than the average weekly price for all
bases of sale. Those instances occurred during periods of in-
creasing prices.

Sizes of Celery.-Over one-third of the FOBAF sales con-
sisted of size 3 dozen celery. The next most important sizes for
this basis of sale were 21/ and 4 dozen (Table 11). Of the FOB-
IAA sales, size 21. was the most prevalent, followed by sizes
3 and 2, respectively. Size 21/ dozen accounted for about one-
third of the Delivered and Consigned sales with sizes 2 and 3
dozen second and third in importance. Only four sizes were sold
on a Price Arrival basis, with size 4 dozen accounting for more
than one-half of all such sales.
There were considerable differences in the average prices of
the more common sizes sold on an FOBAF basis. Smaller sizes,
6, 8, and XX dozen, sold at a premium over all other sizes.
Average prices by sizes for sales on an FOBIAA basis indicated
the same distribution within a narrower range as those sales on
an FOBAF basis. For Delivered and Consigned sales, sizes 2
21, and 3 dozen returned the highest prices among the more
common sizes. A price premium was indicated for the XX size
under Delivered sales and size 11/ for Consigned sales (Table 11).
The smaller sizes returned a lower price than the larger sizes
when sold on a Consigned basis. Average price per crate by
sizes and all bases of sale tended to be higher for the smaller
sizes. Only sizes 4 and 8 dozen did not follow the general pattern
of increased price per crate as size decreased.

Types of Buyers.-Wholesale-receivers, brokers, and chains
bought 80.8 percent of the celery sold on an FOBAF basis." Of
these, only brokers bought more celery on an FOBAF basis than
o Types of buyers are defined on page 33.








Florida Agricultural Experiment Stations


TABLE 11.-Percentage of volume sold and average price per crate, by size
of celery for various bases of sale, 11 Florida sales firms, 1962-63
season.

Basis of Sale
Size Average
FOBAF FOBIAA Delivered Consigned Price by Size
Arrival


1.1
13.3
28.1
35.4
14.1
7.0
.7


Percent
.7
28.3
33.3
25.5
10.0
1.8
.3


1.0
25.4
32.8
21.6
13.2
4.8
1.2


7.5
31.6
53.4
7.5


1.1
19.3
30.3
28.7
14.2
5.2
.6


.3 1.0 .1 .6
100.0 100.0 100.0 100.0 100.0 100.0

Dollars Per Crate
1.60 1.62 1.59 2.23 1.65
2.06 2.09 2.16 1.77 2.07
2.19 2.21 2.15 1.87 2.70 2.17
2.17 2.21 2.19 1.76 1.55 2.16
2.03 2.12 1.94 1.48 1.75 2.02
2.34 2.29 2.20 1.56 1.40 2.26
2.26 2.25 2.05 1.55 2.14
2.34 2.26 3.02 2.30


Average by
basis of 2.14
sale


1.75 1.73 2.13


their average for all bases of sale (Table 12). The same three
types of buyers purchased 92.2 percent of the FOBIAA sales,
with wholesale-receivers accounting for 40.7 percent. Again,
these three major buyers purchased 78.3 percent of all Delivered
sales; yet a fourth buyer, the government, made 15.7 percent
of all purchases on a Delivered basis. Consigned sales were
limited primarily to two types of buyers, wholesale-receivers and
jobbers, who purchased 95.2 percent of all Consigned sales.
All of the Price Arrival sales were made to wholesale-receivers
and brokers.
Average prices received from sales to the three major types
of buyers showed relatively little price differential for FOB type
sales. For Delivered sales there was a difference of $0.16 per
crate between average prices paid by chains and brokers. For


1Y2
2
2%
3
4
6
8
XX
Total


12
2
2/2
3
4
6
8
XX








Florida Celery Industry


TABLE 12.-Percentage of volume purchased and average price per crate, by
basis of sale for various types of buyers, 11 Florida sales firms,
1962-63 season.

Basis of Sale Average
Type of by
Buyer FOBAF FOBIAA Delivered Consigned Price Type of
Arrival Buyer

Percent


Wholesale-
receiver
Broker
Chain
Processor
Jobber
Chain repacker-
processor
Government
Repacker
Independent
retailer
Unknown

Total


Wholesale-
receiver
Broker
Chain
Processor
Jobber
Chain repacker-
processor
Government
Repacker
Independent
retailer
Unknown

Average by
basis of
sale


8.1 .2 2.9
.6 15.7 -- 2.4
1.2 2.1 1.3

.1 .2 .5 .2
.1 .1 .1

100.0 100.0 100.0 100.0 100.0 100.0

Dollars Per Crate


2.23 2.07
2.20 2.14


2.14 2.17


- 2.15
2.13 2.11
- 2.23

2.00 2.07
- 2.17


2.14 1.75 1.73 2.13


all bases of sales chains


paid the highest and wholesale-receivers


the lowest average price among the three major types of buyers.
Prices paid by other types of buyers varied substantially
from a low of $1.58 per crate on an FOBIAA basis by processors
to a high of $2.56 per crate on Delivered sales by jobbers.
Relatively small volumes were purchased in both cases. Although







Florida Agricultural Experiment Stations


prices ranged from $1.96 per crate for all bases of sale by
processors to $2.23 per crate by repackers, average prices paid
per crate for all bases of sale for five of the nine types of
buyers fell within a range of 8 cents per crate.

Methods of Transportation.-During the 1962-63 season, 52.6
percent of all shipments were made by truck and 47.4 percent
by rail. Two-thirds of all FOBAF sales were shipped by truck.
Of the total Consigned and Price Arrival sales, 88.9 and 71.9
percent, respectively, were shipped by rail (Table 13).
No substantial differences were noted in average prices re-
ceived for the two FOB type sales between rail and truck ship-
ments. The average prices received for truck shipments were
higher than those for rail shipments sold on a Delivered basis.
The price differences between rail and truck shipments for Con-
signed and Price Arrival sales were quite large. Consigned
shipments sold at an average price of $1.70 per crate when
shipped by rail and $2.17 per crate shipped by truck. An even
larger difference in price was noted for Price Arrival sales by
rail and truck. The average price received for celery shipped by
truck for all bases of sale was 7 cents per crate higher than
the average price received for all shipments.

TABLE 13.-Percentage of volume shipped and average price per crate, by
method of transportation for various bases of sale, 11 Florida sales
firms, 1962-63 season.
Method of Transportation Total or Average
Basis of by
Sale Rail Truck Basis of Sale
Percent
FOBAF 33.0 67.0 100.0
FOBIAA 51.3 48.7 100.0
Delivered 49.2 50.8 100.0
Consigned 88.9 11.1 100.0
Price Arrival 71.9 28.1 100.0
Average by method 47.4 52.6 100.0
Dollars Per Crate
FOBAF 2.14 2.15 2.14
FOBIAA 2.17 2.16 2.17
Delivered 2.11 2.17 2.14
Consigned 1.70 2.17 1.75
Price Arrival 1.43 2.50 1.73
Average by method 2.09 2.16 2.13







Florida Celery Industry


Market Distribution.-Shipments outside of Florida were
made to 35 states, the District of Columbia, and Canada, and
for export outside the continent of North America. Destinations
of celery shipments were recorded by states and later grouped
into distribution areas as shown in Figure 5. Only those ship-
ments with known destinations were included in the market dis-
tribution data. Shipments to Florida buyers for destinations
outside of Florida were included only if the final destination was
shown on the sales invoice. For that reason no data for sales to
Florida buyers are given. It was assumed that those shipments
with unknown destinations were distributed generally in the
same manner as those with known destinations.


Figure 5.-Market distribution areas for Florida celery, 11 Florida sales firms,
1962-63 season.

Sales on an FOBAF basis were greater than average only
in the South Atlantic area, while sales on an FOBIAA basis
were less than average only in the New England and South
Atlantic areas (Table 14). Delivered sales made up 46.3 percent
of the total volume for export. Only the East South Central
area showed a substantially smaller volume of Delivered sales
than average. Consigned sales were made predominantly to
the New England, Middle Atlantic, and East North Central







Florida sales firms, 1962-63 season.
Basis of Sale Total or
Average
Market Price by
Distribution FOBAF FOBIAA Delivered Consigned Arrival Total Market Area


New England
Middle Atlantic
East North Central
West North Central
South Atlantic
East South Central
West South Central
Mountain
Pacific
Canada
Exports
Averagett by basis
of sale


New England
Middle Atlantic
East North Central
West North Central
South Atlantic
East South Central
West South Central
Mountain
Pacific
Canada
Exports
Averagett by basis
of sale


28.6
-49.2
44.5
68.1
33.9
65.6
75.8
100.0
100.0
89.0
53.7


Percent
17.2
17.7
22.3
21.4
19.9
2.8
13.6


100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0
100.0


35.0 43.9 13.7 7.2 .2 100.0
Dollars Per Crate
2.19 2.18 2.09 1.53 1.50 2.03
2.10 2.24 2.24 1.83 1.62 2.15
2.11 2.17 2.11 1.72 1.60 2.08
2.16 2.23 2.29 1.58 2.65 2.21
2.08 2.04 2.08 2.02 2.14 2.07
2.19 2.15 2.20 2.16
2.30 2.20 2.09 2.20
1.75 1.75
2.00 2.00
2.28 2.12 2.13
2.37 1.99 2.19


t Less than one-tenth of 1 percent.
t Mountain and Pacific areas combined are equal to one-tenth of 1 percent.
tt Includes shipments to Florida buyers and shipments with unknown destinations.


TABLE 14.-Percentage of volume purchased and average price per crate, by basis of sale


in designated market distribution areas, 11






Florida Celery Industry


areas, with a greater-than-average amount being consigned to
the New England area.
The five leading areas of distribution were: Middle Atlantic,
East North Central, South Atlantic, Canada and New England.
Among these leading areas, the highest average price for all
bases of sale was paid by buyers in the Middle Atlantic area.
By basis of sale, export sales on an FOBIAA basis returned the
highest average price per crate with the exception of a very
small volume sold on a Price Arrival basis in the West North
Central area. Average price varied from area to area and by
basis of sale with no apparent trend; yet each area showed a
higher-than-average price for at least one basis of sale.

Types of Buyers
For all sales invoices sampled, each buyer was classified by
the most important function which he performed. Data on
individual buyers were obtained from The Blue Book (5).
Buyers were classified according to the first listing given for the
type of business in which they were engaged. Celery was pur-
chased by 350 buyers in 36 states, the District of Columbia, and
Canada. Nine classifications by type of buyer were established.
The nine specific types of buyers were further classified into
four general groups according to their methods of operation.
The first group, brokers, includes both buying and selling as well
as terminal brokers. Although they arranged for such physical
handling by others, these firms did not physically handle mer-
chandise. Their primary function was to bring together a willing
buyer and seller. For this they charged a set amount per crate.
The usual brokerage ranged from $0.07 to $0.10 per crate. The
second general classification of buyer was that of retail organi-
zations. This group included national and regional chains and
independent retailers. They bought celery directly from sales
firms in the production area for sale in their own retail stores.
Also included were the chain repackers and processors who
bought celery directly from production area sales firms and
processed or repacked for their own retail stores. The third
group, known as wholesale-handlers, included wholesale-receivers
and jobbers. They purchased celery in carlot or smaller quan-
tities for resale to chains, independent retailers, and sometimes
to other wholesale-handlers. Included also in this group were
the processors and repackers who purchased celery and processed







Florida Agricultural Experiment Stations


or repacked it for resale to chains, independent retailers, or other
wholesale-handlers. The fourth general group, sales to the
government, were direct purchases by the military for immediate
consumption.
The three most important types of buyers during the 1962-63
season were wholesale-receivers, brokers, and chains. They pur-
chased 85.8 percent of the total volume sampled (Table 15).
Wholesale-receivers accounted for the greatest portion, brokers
were second, and chains third. The remaining 14.2 percent was
fairly evenly divided between processors, jobbers, repackers,
government, chain repackers and processors and, finally, in-
dependent retailers who accounted for less than 1 percent of the
volume sampled.
Of the three leading volume buyers, chain buyers paid the
highest average price, $2.18; brokers were second, $2.15; and
wholesale-receivers third, $2.10 per crate. Of the six remaining
types of buyers, repackers paid the highest average price per
crate, $2.33, and processors paid the lowest average price, $1.96
per crate.
TABLE 15.-Total number and percentage of crates sampled, value and average
price per crate, by type of buyer, 11 Florida sales firms, 1962-63
season.
Crates Sampled Value of Average
Type of Crates Price by
Buyer Number Percent Sampled Type of Buyer
Dollars Dollars
Wholesale-receiver 240,365 37.8 504,774 2.10
Broker 166,902 26.2 358,689 2.15
Chain 138,613 21.8 301,959 2.18
Processor 24,914 3.9 48,808 1.96
Jobber 21,357 3.4 42,991 2.01
Chain repacker-
processor 18,706 2.9 40,233 2.15
Government 15,288 2.4 32,266 2.11
Repacker 8,524 1.3 19,035 2.23
Independent retailer 1,246 .2 2,582 2.07
Unknown 357 .1 775 2.17
Total or average 636,272 100.0 1,352,112 2.13

Shipping Areas.-Buyers purchased three-fifths or more of
their Florida celery from the Belle Glade area, and only three
or four types of buyers were important purchasers in the other
areas (Table 16). Jobbers, brokers, and wholesale-receivers were








Florida Celery Industry


the three most important buyers in the Central Florida area.
Wholesale-receivers, government, and jobbers were the three
most important buyers in the West Florida area. Lack of volume
and lack of other vegetables for mixed loading may have caused
buyers to neglect the Central and West Florida areas. Shippers
in these areas have probably been forced to switch to buyers
who handle full carlots of celery. Likewise, firms in these two
areas sold more of their volume on a Consigned basis and shipped
to wholesale-receivers or jobbers who would accept Consigned
merchandise.
Average prices paid per crate by buyers who purchased in
the Belle Glade and Central Florida areas were higher in the


TABLE 16.-Percentage of volume purchased and average
type of buyer from various shipping areas, 11
1962-63 season.


price per crate, by
Florida sales firms,


Type of
Buyer


Wholesale-receiver
Broker
Chain
Processor
Jobber
Chain repacker-
processor
Government
Repacker
Independent retailer
Average by area


Wholesale-receiver
Broker
Chain
Processor
Jobber
Chain repacker-
processor
Government
Repacker
Independent retailer
Average by area


Shipping Area
Belle Central West
Glade Florida Florida
Percent
70.8 13.8 15.4
84.7 13.9 1.4
85.6 7.6 6.8
95.3 4.7 -
64.1 26.5 9.4


100.0
76.5
98.8
1 nn


Total or Average
by
Type of Buyer


100.0
100.0
100.0
100.0
100.0

100.0
100.0
100.0
1 nn


LVU.U -- -- V..
79.9 11.9 8.2 100.0

Dollars Per Crate
2.12 2.00 2.08 2.10
2.18 1.98 2.21 2.15
2.18 2.05 2.32 2.18
1.95 2.05 1.96
2.01 1.88 2.40 2.01

2.15 2.15
2.12 2.12 2.01 2.11
2.24 1.85 2.23
2.07 2.07
2.14 2.00 2.14 2.13


t Includes unknown type of buyer in the Belle Glade area who purchased less than
one-tenth of 1 percent of the volume.







Florida Agricultural Experiment Stations


Belle Glade area except for sales made to processors. Similarly,
average prices per crate by all buyers who purchased in the
Central and West Florida areas were higher in the West Florida
area for all buyers except for sales to the government. Although
average prices received from sales to brokers, chains, and jobbers
were higher in the West Florida area than in the Belle Glade
area, other comparable buyers paid a higher average price
in the Belle Glade area. However, the average price for the
two areas was the same.

Sizes of Firms.-By comparing volume sold to each type of
buyer by the three firm sizes in Table 17, several points are
evident: (a) As firm size decreased, the percentage of volume
sold to brokers decreased; (b) Sales to chains were greater than
average for the medium firms, slightly less for the large firms,
and quite small for the small firms; (c) The percentage of sales
to wholesale-receivers increased as firm size decreased; (d)
The percentage of sales to the other types of buyers varied be-
tween firm size, but tended to decrease as the size of firm
decreased.
By comparing wholesale-receiver purchases in Tables 12 and
17 it is apparent that the volume of Consigned sales among
medium and small firms accounts for the importance of whole-
sale-receivers to those firm groups.
Average prices paid by the three leading types of buyers
were generally higher for medium firms than for large or small
firms (Table 17). Likewise, prices paid to large firms were, for
the most part, higher than those paid to small firms.

Weekly Shipments.-No significant periods of peak pur-
chases could be determined among the three major types of
buyers. Shipments to these buyers were relatively constant over
the entire season (Table 18). The average prices paid by these
buyers indicated that brokers and chains purchased slightly
more celery when the price was high, while wholesale-receivers
purchased more celery when the price was low. Processors and
jobbers purchased more celery during periods of low prices.
Purchases by independent retailers were erratic, with greatest
volume during periods of low prices. Purchases by repackers
and chain repackers and processors were also erratic, but the
greater portion of their purchases were made during periods of
higher than season average prices. Although purchases by the







Florida Celery Industry


TABLE 17.-Percentage of volume purchased and average price per crate, by
type of buyer from various sizes of firms, 11 Florida sales firms,
1962-63 season.

Type of Size of Firm Average by
Buyer Large Medium Small Type of Buyer
Percent


Wholesale-receiver
Broker
Chain
Processor
Jobber
Chain repacker-
processor
Government
Repacker
Independent retailer
Unknown
Total
Average by
size of firm


Wholesale-receiver
Broker
Chain
Processor
Jobber
Chain repacker-
processor
Government
Repacker
Independent retailer
Unknown


30.3
32.4
20.5
5.7
3.9

3.3
2.8
.7
.3
.1
100.0

64.0


16.2 10.8 26.2
27.7 6.3 21.8
.9 3.9
2.3 3.1 3.4

2.8 2.9
2.1 2.4
3.0 1.3
t .2
.1
100.0 100.0 100.0

29.8 6.2 100.0
Dollars Per Crate
2.11 1.98 2.1(


Average by
size of firm 2.13 2.14 2.01 2.13
t Less than one-tenth of 1 percent.

government were made almost every week of the season, the


average volume purchased weekly was greatest
months of February through May.


during the


Sizes of Celery.-Four types of buyers-chain processors and
repackers, jobbers, brokers, and wholesale-receivers-indicated a
preference for size 3 dozen first and size 21/2 dozen second.
These two sizes accounted for 81.2 percent of the purchases by
chain repackers and processors, 60.8 percent of the purchases
by brokers, 55.4 percent by jobbers, and 52.9 percent by whole-







Florida Agricultural Experiment Stations


TABLE 18.-Percentage of volume purchased and average price per crate, by week for

Type of Buyer

Week Wholesale Broker Chain Processor
Week Receiver
Beginning
Per- Avg. Per- Avg. Per- Avg. Per- Avg.
cent Price cent Price cent Price cent Price


Nov. 4
11
18
25

Dec. 2
9
16
23
30

Jan. 6
13
20
27

Feb. 3
10
17
24

March 3
10
17
24
31

April 7
14
21
28

May 5
12
19
26

June 2
9
16
23
30
Total
Average by
type of
buyer


37.8 2.10 26.2


Dollars
2.38
2.16
2.02
1.44


Dollars Dollars
- 2.6 2.25


.3 2.50
.4 2.07
1.0 1.39

1.5 1.34
3.5 1.32
4.2 2.55
1.6 2.74
1.8 2.79


Dollars
.6
.2 1.93 1.5
1.1 1.88 1.4
1.9 1.48 1.7

1.7 1.30 3.6
2.0 1.33 3.7
2.8 2.51 4.2
1.8 2.74 3.8
2.2 2.70 2.7

2.2 2.60 2.8
3.8 2.25 4.0
3.5 2.19 3.4
3.1 2.20 3.1

4.4 2.26 3.5
5.2 2.71 5.0
3.6 2.81 4.2
3.3 2.27 3.4

5.1 1.98 3.1
4.4 1.93 4.1
3.5 1.93 3.4
3.7 1.87 4.2
5.1 1.90 3.9

4.7 1.89 4.4
2.9 2.27 3.3
2.5 2.35 3.1
2.9 2.03 3.8

6.0 1.89 2.3
3.4 1.85 2.4
3.7 1.77 3.5
2.8 1.74 2.2

2.7 1.82 .9
1.7 2.20 1.6
1.2 2.14 .7
.8 2.42 .4
.1
100.0 100.0


7.2 1.89
4.5 2.07
4.3 1.95
4.4 2.01
6.4 1.98


1.91 2.6 1.97
2.25 4.4 2.43
2.37 3.0 2.39
2.17 4.1 2.20

1.98 2.3 1.98
1.95 2.0 1.98
1.86 5.3 1.98
1.87 1.4 1.92


.9 1.98
.9 2.38
.8 2.12
.2 2.35

100.0


2.15 21.8 2.18


-- -
2.0 1.83
2.0 2.05

6.1 1.35
4.0 1.30
2.1 2.70
2.0 2.70

4.5 2.48
4.1 1.95

2.1 2.25

2.2 2.20
2.0 2.70
4.2 2.53
2.0 1.95

4.7 1.51
4.2 1.71
2.0 1.45
2.0 1.70


4.7 1.98
3.3 2.49
1.9 2.30
3.2 2.14

2.2 1.95
8.4 1.94
5.8 1.85
3.8 1.87

1.9 1.70
3.9 1.80
6.1 1.83


100.0

3.9 1.96


2.60 2.8 2.55
2.13 2.8 2.28
2.22 2.5 2.23
2.22 3.5 2.24

2.23 4.0 2.25
2.69 4.8 2.65
2.72 4.6 2.90
2.48 6.0 2.33







Florida Celery Industry 39

various types of buyers, IT Florida sales firms, 1962-63 season.

Type of Buyer

Jobber Chain Repacker- Government Repacker Independent
Jobber Processor Retailer
Per- Avg. Per- Avg. Per- Avg. Per- Avg. Per- Avg.
cent Price cent Price cent Price cent Price cent Price


Dollars
.1 2.45
3.3 1.66
.4 2.17
2.0 1.34

.9 1.31

6.0 2.57
.7 2.73


.2 2.63
1.7 2.13
5.0 2.15
.7 2.25

1.5 2.25
3.2 2.83
5.0 2.97
5.0 1.85

6.6 1.50
7.6 1.55
1.7 1.45
1.4 2.03
5.1 1.80

7.8 1.67
6.8 1.94
3.8 2.43
.8 2.04

5.9 1.99
1.5 1.91
3.1 2.14
1.6 1.91

2.6 1.86
2.3 2.03
4.4 2.14
1.3 3.16


Dollars






8.0 1.32
7.2 1.31
10.9 2.64
5.9 2.71
1.0 2.95

4.4 2.52
16.9 2.30
9.6 2.18
4.4 2.20

3.2 2.20
1.2 2.76
.1 3.45
.3 3.20

1.8 2.07
5.1 1.92
1.6 1.95

1.9 1.89

1.1 1.95
.8 2.25
3.8 2.30
5.0 2.17

5.8 1.97


Dollars
.3 2.80 -
3.4 2.57 -
.8 2.27 -
.5 1.35 1.5

2.1 1.35 1.8
1.1 1.35 3.5
1.3 2.75 2.9
- 3.0
1.8 2.75 8.4

1.8 2.66 1.9
1.5 2.36 -
7.8 2.25 -
.3 2.25 4.4

.9 2.25 9.4
2.5 2.75 -
3.7 2.73 7.9
8.1 2.00 8.4

1.5 1.65 19.8
t.0 1.90 4.7
8.8 1.75 2.5
6.1 1.82 -
2.7 2.00 8.7

5.8 2.00 -
2.1 2.50 -
7.8 2.35 -
2.3 2.22 1.3

1.3 2.00 -
1.2 1.82 -
4.1 1.75 -
5.7 1.95 4.0

3.9 2.00 5.9
2.5 2.45 -
1.3 2.50 -


Dollars Dollars

3.2 1.75

1.30 -

1.30 -
1.30 -
2.70 -
2.70 -
3.17 2.4 3.08

2.45 5.6 2.52
10.9 2.03
6.4 2.25
2.03 -

2.08 -

2.96 2.0 3.00
2.99 -

2.11 -
2.14 -
1.90 32.1 2.00

1.60 -




1.75 -




1.75 37.4 1.96


1.77 -


100.0 100.0 100.0 100.0 100.0


3.4 2.01 2.9 2.15 2.4 2.11 1.3 2.23 .2 2.07








TABLE 19.-Percent of volume purchased and average price per crate, by size of celery for various types of buyers, 11 Florida sales
firms, 1962-63 season.

All Sizes
e of Size of Celery
Type of Buyer
Buyer 1% 2 21/2 3 4 6 8 XX Total Average

Percent


Wholesale-receiver .6 22.2 26.0 26.9 14.1 8.3
Broker 1.5 16.5 27.7 33.1 15.4 4.5
Chain 1.0 16.2 46.8 26.9 8.2 .8
Processor 7.4 24.8 17.5 19.5 27.9 2.8
Jobber 18.0 21.8 33.6 21.2 4.8
Chain repacker-
processor 4.1 21.9 59.3 8.3 6.4
Government 54.3 36.8 8.7 .2 -
Repacker 6.2 2.8 11.8 68.4 10.8
Independent retailer 8.8 16.9 43.7 30.6


100.0
100.0
100.0
100.0
100.0

100.0
100.0
100.0
100.0


Average by size t

Wholesale-receiver
Broker
Chain
Processor
Jobber
Chain repacker-
processor
Government
Repacker
Independent retailer


1.1 19.3 30.3 28.7 14.2 5.2 .6 .6 100.0 100.0
Dollars Per Crate
1.74 2.05 2.14 2.14 1.97 2.21 2.18 2.26 2.10
1.65 2.07 2.20 2.17 2.07 2.30 2.04 2.36 2.15
1.63 2.11 2.17 2.24 2.24 2.23 2.14 2.18
1.59 2.15 1.92 2.08 1.81 2.11 2.00 1.96
- 1.96 2.27 1.99 1.80 2.13 1.79 2.00 2.01

- 2.35 2.26 2.08 2.16 2.33 2.15
- 2.02 2.22 2.18 2.50 2.11
- 1.73 2.29 2.46 2.09 3.20 2.23
- 2.32 2.15 2.02 2.03 2.07


Average by size 1.65 2.07 2.17 2.16 2.02 2.26 2.14 2.30 2.13
t Includes a small percentage of 2, 21, 3, and 4 dozen sizes purchased by an unknown type of buyer. Each size contains less than two-tenths of
1 percent unknown.







Florida Celery Industry


sale-receivers. Both repackers and processors bought a greater
percentage of size 4 dozen celery (Table 19). Their second choice
was quite different, and their preference for the larger or smaller
sizes was reversed. More than 90 percent of the total purchases
of repackers was for sizes 3 dozen and smaller, while over 97
percent of sales to the processors were for sizes 4 dozen and
larger. Government purchasers indicated the strongest prefer-
ence for the larger sizes. Although most buyers indicated an
over-all preference for the larger or smaller sizes, all except two
types of buyers purchased their second greatest percentage of
total purchases in one of the two most common sizes, 21/2 and 3
dozen.
Average prices paid by the three major buyers wholesale-
receivers, brokers, and chains for the four most common sizes
- 2, 21/, 3, and 4 increased and then decreased as the size
became smaller with prices much higher for sizes 21/ and 3 dozen
than those for sizes 2 and 4 dozen (Table 19). The only excep-
tion was that the price paid by chains for size 4 dozen was
greater than the price of the 214 dozen size and equal to the
price of the 3 dozen size. Prices paid for the four most common
sizes by the other buyers varied between the types of buyers.
Prices for sizes 2 and 4 dozen were $0.09 to $0.15 per crate lower
than the prices for sizes 21/ and 3 dozen. Prices for sizes smaller
than 4 dozen varied between type of buyer and size but resulted
in an over-all average price greater than all other sizes for 6 and
XX dozen sizes.

Methods of Transportation.-Each of the nine types of
buyers showed a preference for one of the two methods of
transportation. Wholesale-receivers and jobbers received a
greater percentage of their purchases by rail (Table 20). This
was the result of the relatively greater volume of Consigned
sales to those two types of buyers. Although brokers shipped
more of their volume by truck, their large percentage of rail
shipments was probably a result of purchases made on a Con-
signed basis. Those three buyer types handled almost all of the
celery sold on a Consigned basis (Table 12), of which almost 90
percent was shipped by rail (Table 13). Consequently, one would
expect those buyers to show a preference for rail transportation.
All other types of buyers preferred shipments by truck, ranging
from 84.6 percent of total volume to processors to 63.1 percent
to chain buyers.







Florida Agricultural Experiment Stations


TABLE 20.-Percentage of volume purchased and average price per crate, by
method of transportation for various types of buyers, 11 Florida
sales firms, 1962-63 season.

Type of Method of Transportation Total or Average
Buyer Rail Truck by Type Buyer
Percent
Wholesale-receiver 61.3 38.7 100.0
Broker 45.2 54.8 100.0
Chain 36.9 63.1 100.0
Processor 15.4 84.6 100.0
Jobber 54.2 45.8 100.0
Chain repacker-
processor 31.0 69.0 100.0
Government 22.4 77.6 100.0
Repacker 26.5 73.5 100.0
Independent retailer 32.1 67.9 100.0
Unknown 100.0 100.0
Average by method 47.4 52.6 100.0
Dollars Per Crate
Wholesale-receiver 2.04 2.19 2.10
Broker 2.14 2.16 2.15
Chain 2.16 2.19 2.18
Processor 2.12 1.93 1.96
Jobber 1.89 2.15 2.01
Chain repacker-
processor 2.21 2.12 2.15
Government 1.99 2.14 2.11
Repacker 2.70 2.06 2.23
Independent retailer 2.00 2.11 2.07
Unknown 2.17 2.17
Average by method 2.09 2.16 2.13


Average price paid by all buyers was $2.16 per crate for
celery shipped by truck, but only $2.09 per crate for celery
shipped by rail. To a great extent the difference in average
prices by method of transportation was due to the lower prices
received for Consigned sales shipped by rail (Table 13). The
three types of buyers who handled Consigned sales in volume
also paid a lower average price for purchases transported by
rail. Only processors, repackers, and chain repacker-processors
paid a higher average price for celery moved by rail. This was
due primarily to the sizes of celery they purchased and the
periods during the season when their purchases were made.






Florida Celery Industry


Market Distribution.-Wholesale-receivers accounted for the
greatest volume of purchases in all distribution areas except the
South Atlantic, Mountain, and Pacific. Brokers and chains were
the only purchasers in the latter two areas. In the South Atlantic
area purchases by processors accounted for the greatest percent-
age of the volume (Table 22). Brokers were more predominant
in the West North Central and West South Central areas than
expected from the average of all brokers for all areas. They may
have been purchasing for chain accounts in those areas to a
greater extent than in other areas. The invoices seldom disclosed
the identity of brokers' clients. For this reason also, total pur-
chases by chains were relatively greater than the data through-
out this publication indicate.
Shipments to the Middle Atlantic and East North Central
areas accounted for 50.9 percent of the volume of celery with
known destinations, while shipments to the Mountain and Pacific
areas accounted for 0.1 percent of the total volume.
Six of the nine types of buyers paid the highest price per
crate in one or more of the 11 distribution areas. Repackers
paid the highest and lowest average price by distribution areas
and the highest average price of all types of buyers. The three
major types of buyers, wholesale-receivers, brokers, and chains,
paid the highest price in six areas and the second highest price
in seven areas. Jobbers, repackers, and the government paid
the highest price per crate for the remaining five areas, while
the government paid the second highest price in two areas.
Interpackinghouse Sales
In the process of sampling invoices, data on transactions
between authorized sales firms were obtained. These data were
segregated from sales to all other types of buyers and analyzed
separately in order to avoid double sampling. Interpackinghouse
transactions were made by firms because of inadequate supplies
within their own organization.
Although a larger than normal volume of interpackinghouse
sales was noted in a few weeks, no definite trends were apparent
in the data (Table 22). Sales of hearts between firms which
maintained a heart packing operation and those firms which
did not were classified also as interpackinghouse sales, since
these transfers were for the purpose of filling orders. A rela-
tively small volume of hearts was purchased by interpacking-
house transfers.







Florida Agricultural Experiment Stations


TABLE 21.-Percentage of volume purchased and average price per crate, by type of buyer

Type of Buyer
Distribution Wholesale-
Area Receiver Broker Chain Processor Jobber

Percent

New England 68.3 11.6 18.4 -
Middle Atlantic 51.1 9.8 27.4 1.0 7.3
East North Central 52.8 23.6 21.5 1.7 .2
West North Central 37.4 36.8 23.4 1.2
South Atlantic 22.9 13.1 21.1 27.5 5.0
East South Central 46.7 26.3 21.6 3.8
West South Central 36.5 32.6 20.9 4.4
Mountain 100.0 -
Pacific 100.0 --
Canada 55.5 25.8 13.1 5.6
Exports 64.2 5.4 -
Average by type of
buyertt 37.8 26.2 21.8 3.9 3.4


Dollars Per Crate

New England 2.00 2.14 2.08 -

Middle Atlantic 2.10 2.22 2.21 2.38 1.92
East North Central 2.03 2.12 2.19 2.01 2.00
West North Central 2.19 2.23 2.24 1.95
South Atlantic 2.11 2.21 2.12 1.93 2.10
East South Central 2.21 2.15 2.06 2.33
West South Central 2.23 2.18 2.20 2.05
Mountain 1.75 -
Pacific 2.00 -
Canada 2.16 1.98 2.32 2.12
Exports 2.29 1.85 -
Average by type of
buyertt 2.10 2.15 2.18 1.96 2.01

t Includes only that celery for which both type of buyer and destination were known.
t Mountain and Pacific areas combined are equal to one-tenth of 1 percent.
tt Includes celery sold to known types of buyers with unknown destinations.







Florida Celery Industry


in various distribution areas, 11 Florida sales firms, 1962-63 season.
Type of Buyer Area

Chain Repacker- Independent
Processor Government Repacker Retailer Unknown Total Average

Percent

1.2 .5 100.0 6.7
1.9 1.0 .5 100.0 25.5
.2 100.0 25.4
1.2 100.0 5.4
9.5 .4 .5 100.0 15.9
1.6 100.0 3.9
.7t 3.7 .6 .6 100.0 6.0
100.0
100.0
100.0 9.2

30.4 -- 100.0 1.9

2.9 2.4 1.3 .2 .1 100.0 100.0

Dollars Per Crate

2.05 1.87 2.03
2.32 3.09 2.06 2.15
2.40 2.08
2.31 2.21
2.05 1.60 2.00 2.07
1.97 2.16
2.00t 2.17 2.32 2.17 2.20
1.75
S- 2.00
S- 2.13

2.05 2.19

2.15 2.11 2.23 2.07 2.17 2.13







Florida Agricultural Experiment Stations


A comparison of interpackinghouse transfers by size of firm
showed: (a) the percentages of total volume of sales by the
large and medium firms were greater than their purchases, and

TABLE 22.-Number and percentage of crates sold and weekly average price
per crate for interpackinghouse sales, 11 Florida sales firms, 1962-
63 season.

Sizes 11/2 through XX Hearts, 2 dozen Equivalent
Week Crates Sampled Average Crates Sampled Average
Beginning Number Percent Price Number Percent Price


Nov. 11
18
25

Dec. 2
9
16
23
30

Jan. 6
13
20
27

Feb. 3
10
17
24

March 3
10
17
24
31

April 7
14
21
28

May 5
12
19
26

June 2
9
16
Total or
average


1,768
359
750

1,626
1,642
652
2,421
1,865

1,215
5,145
1,487
1,675

2,545
967
1,880
2,809

2,968
956
1,937
2,428
1,923

1,650
702
1,384
2,480

2,185
1,588
3,591
1,114

225
1,085
680


Dollars

1.73
2.32
1.25

1.30
1.27
2.62
2.68
2.72

2.65
2.21
2.19
2.20

2.20
2.61
2.80
2.41


Dollars


2.25

2.25

3.43
3.65
3.90


3.13
3.05
4.40


3.65
4.50
3.98


1.3 2.75


55,702 100.0 2.08 2,349 100.0







Florida Celery Industry


TABLE 23.-Number and percentage of crates sampled and average price per
crate for interpackinghouse sales and purchases, by firm size,
11 Florida sales firms, 1962-63 season.
Sales Purchasest
Firm Per- Average Per- Average
Size Crates cent Price Crates cent Price
Dollars Dollars
Large 26,508 47.6 1.99 24,016 43.1 2.05
Medium 27,669 49.7 2.25 26,148 47.0 2.12
Small 1,525 2.7 2.01 5,538 9.9 2.00
Total or
average 55,702 100.0 2.08 55,702 100.0 2.08
t Sales were made by 11 Florida sales firms, while purchases were made by 14 Florida
sales firms.

conversely, smaller firms purchased considerably larger quanti-
ties than they sold (Table 23); (b) large firms sold at lower
prices than they bought, medium firms sold at a much higher
price than they bought, while little difference was indicated be-
tween purchases and sales by small firms. Except for the possi-
bility that large firms, in order to satisfy purchase contracts,
may have been forced to pay higher prices for celery, the differ-
ences in sizes bought and sold and the time during the season
in which the transactions were made were largely responsible
for the price differences shown.


Methods of Transportation

It has been shown earlier (Tables 13 and 21) that 52.6 percent
of the Florida celery was shipped by truck and 47.4 percent by
rail during the 1962-63 season. Transportation by type of sale
and type of buyer were shown also in the tables quoted above.
The methods of transportation from Florida shipping areas,
size of firm, and weekly movement will be covered in this section.

Shipping Areas.-Although more celery was shipped by truck
for the state as a whole, only the Belle Glade area shipped more
by truck than by rail (Table 24). That area, which accounted
for nearly 80 percent of total volume (Table 3), shipped 56.6
percent of its volume by truck and 43.4 percent by rail. Shippers
in the Central and West Florida areas moved 53.9 percent and
75.7 percent, respectively, by rail. This reflected the lack of







Florida Agricultural Experiment Stations


TABLE 24.-Percentage of volume shipped and average price per crate, by
method of transportation from various shipping areas, 11 Florida
sales firms, 1962-63 season.

Method of Transportation

Shipping Rail Truck By Area
Shipping
Area Average Average Total Average
Percent Price Percent Price Percent Price
Dollars Dollars Dollars
Belle Glade 43.4 2.10 56.6 2.17 100.0 2.14
Central 53.9 1.96 46.1 2.04 100.0 2.00
West Florida 75.7 2.13 24.3 2.15 100.0 2.14
Average by
method 47.4 2.09 52.6 2.16 100.0 2.13


local buyers in these two areas and the tendency of firms there
to sell direct to terminal buyers or to consign.
Average prices per crate by method of transportation and
shipping area were higher for shipments by truck from all areas.
Average prices received for celery transported by both methods
from the Central Florida area were considerably lower than
the prices received by type of transportation in the other two
areas.

Sizes of Firms.-Greater differences occurred between prices
received by methods of transportation when classified by firm
size. Large and medium firms shipped approximately 45 percent

TABLE 25.-Percentage of volume shipped and average price per crate, by
method of transportation for various size firms, 11 Florida sales
firms, 1962-63 season.

Method of Transportation
Rail Truck By Firm Size
Firm
Size Average Average Total Average
Percent Price Percent Price Percent Price
Dollars Dollars Dollars
Large 45.2 2.10 54.8 2.15 100.0 2.13
Medium 44.7 2.10 55.3 2.18 100.0 2.14
Small 82.5 1.99 17.5 2.10 100.0 2.01
Average by
method 47.4 2.09 52.6 2.16 100.0 2.13







Florida Celery Industry


of their volume by rail (Table 25). On the other hand, small
firms shipped 82.5 percent of their celery by rail.
Again, average prices were higher for shipments by truck
for all firms. Similarly, average prices for shipments by both
rail and truck were higher for the large and medium firms than
for the small firms.

Weekly Shipments.-Truck shipments were greater than rail
in most weeks during the months of November, December, Jan-
uary, February, and June. Rail shipments were greater than
those by truck during March, April, and May (Table 26). The
peak period for rail shipments occurred during March and early
April, while the peak for truck shipments occurred during Feb-
ruary and early March. Truck shipments were greater than rail
during most of the higher price periods.

Market Distribution
It was shown earlier that 50.9 percent of the volume shipped
from Florida was distributed in the Middle Atlantic and East
North Central areas (Tables 14 and 21). Distribution by type
of sale and type of buyer were also shown in those tables. The
weekly shipments and differences in type of transportation to
principal distribution areas will be taken up here.
Weekly Shipments.-The peak period of shipments to the
Middle Atlantic and East North Central areas was during the
15 weeks beginning the week of January 6 and ending the week
of April 14 (Table 27). The last five weeks of this period were
heaviest for the Middle Atlantic area, while the second five
weeks were the heaviest for the East North Central area. The
Middle Atlantic area received 65.6 percent of its volume and
the East North Central area 59.7 percent during this 15-week
period. Shipments to the South Atlantic area were continuous
throughout the season. Generally, the weeks of relatively higher
volume occurred during a low price period. Shipments to Canada
were heaviest during the period beginning January 27 and end-
ing the week of April 28, during which Canadian buyers received
63.2 percent of their total volume from Florida. Shipments
were made during both high and low price periods.
The preceding three areas, although showing a generalized
peak period, were characterized by a fairly even flow of celery
throughout the season. The reverse tended to be true in the









Florida Agricultural Experiment Stations


TABLE 26.-Percentage of volume shipped and average price per crate, by week
for different methods of transportation, 11 Florida sales firms,
1962-63 season.

Method of Transportation

Week Rail Truck Weekly
Beginning Average Average Percent Average
Percent Price Percent Price Shipped Price


Nov. 4
11
18
25

Dec. 2
9
16
23
30

Jan. 6
13
20
27

Feb. 3
10
17
24

March 3
10
17
24
31

April 7
14
21
28

May 5
12
19
26

June 2
9
16
23
30
Total or
average


Dollars

2.25
1.94
1.80
1.38

1.32
1.34
2.62
2.73
2.73

2.57
2.28
2.18
2.22

2.26
2.69
2.71
2.12

1.85
1.91
1.92
1.84
1.91

1.87
2.31
2.36
2.09

1.89
1.80
1.81
1.74

1.83
2.18
2.11
2.03


100.0


Dollars

2.56
2.16
2.02
1.54

1.33
1.32
2.53
2.72
2.84

2.57
2.15
2.22
2.21

2.23
2.70
2.89
2.46

1.98
1.98
1.89
1.96
1.92

1.94
2.28
2.37
2.18

1.98
1.96
1.93
1.90

1.88
2.23
2.09
2.60
2.83


Dollars

2.34
2.13
1.95
1.47

1.33
1.33
2.56
2.73
2.79

2.57
2.21
2.20
2.22

2.24
2.70
2.80
2.32

1.91
1.94
1.91
1.90
1.91

1.90
2.30
2.37
2.13

1.93
1.91
1.86
1.82

1.86
2.21
2.10
2.39
2.83


2.09 100.0 2.16 100.0 2.13


t Less than one-tenth of 1 percent.







Florida Celery Industry


New England and East South Central areas. Shipments to New
England were greatest during the weeks of February 17 through
March 31. During these seven weeks, 46.2 percent of the total
volume was received in the area and prices were generally below
average. In the East South Central area, also, a relatively large
percentage of the area's volume was received during a few
weeks. However, those purchases were made during a period
of relatively high prices in December and January. Shipments
to the West South Central area were heaviest from the week
of February 17 through that of April 17. Shipments for export
were erratic throughout the season.
Methods of Transportation.-Four of the five leading market
distribution areas received 65 percent or more of their total
volume by rail (Table 28). Three of these areas, New England,
East North Central, and West North Central, were located in
the northern part of the United States, and the fourth was
Canada. Other studies of vegetable distribution also indicate
that the use of rail transportation increases with distance from
the production area. Shipments to southern market distribution
areas were predominantly by truck. Sales for export were trans-
ported mainly by truck to eastern seaports.


THEORETICAL GUIDELINES FOR PRICE
AND MARKETABLE OUTPUT
The primary decisions which must be made by the Advisory
Committee for the Marketing Order relate to marketable output,
and those by the directors of the Exchange relate to price.
Although the organization and marketing operations of the
Florida celery industry have been discussed in some detail, these
discussions have not related directly to either of the above de-
cisions. The purpose of this section is to provide theoretical
guidelines for maximizing profits to the industry rather than
provide specific answers to price and output questions.

The Economic Model
Agriculture is often thought of as a segment of the United
States economy that closely approximates the economic model
of pure competition. This is undoubtedly true for some com-
modities, such as cattle and hogs at the farm level, but the







Florida Celery Industry


New England and East South Central areas. Shipments to New
England were greatest during the weeks of February 17 through
March 31. During these seven weeks, 46.2 percent of the total
volume was received in the area and prices were generally below
average. In the East South Central area, also, a relatively large
percentage of the area's volume was received during a few
weeks. However, those purchases were made during a period
of relatively high prices in December and January. Shipments
to the West South Central area were heaviest from the week
of February 17 through that of April 17. Shipments for export
were erratic throughout the season.
Methods of Transportation.-Four of the five leading market
distribution areas received 65 percent or more of their total
volume by rail (Table 28). Three of these areas, New England,
East North Central, and West North Central, were located in
the northern part of the United States, and the fourth was
Canada. Other studies of vegetable distribution also indicate
that the use of rail transportation increases with distance from
the production area. Shipments to southern market distribution
areas were predominantly by truck. Sales for export were trans-
ported mainly by truck to eastern seaports.


THEORETICAL GUIDELINES FOR PRICE
AND MARKETABLE OUTPUT
The primary decisions which must be made by the Advisory
Committee for the Marketing Order relate to marketable output,
and those by the directors of the Exchange relate to price.
Although the organization and marketing operations of the
Florida celery industry have been discussed in some detail, these
discussions have not related directly to either of the above de-
cisions. The purpose of this section is to provide theoretical
guidelines for maximizing profits to the industry rather than
provide specific answers to price and output questions.

The Economic Model
Agriculture is often thought of as a segment of the United
States economy that closely approximates the economic model
of pure competition. This is undoubtedly true for some com-
modities, such as cattle and hogs at the farm level, but the








Florida Agricultural Experiment Stations


TABLE 27.-Percentage of total volume shipped and average price per crate, by week in
Market Distribution Area
New Middle East North West North South
Week England Atlantic Central Central Atlantic
Beginning Per- Avg. Per- Avg. Per- Avg. Per- Avg. Per- Avg.
cent Price cent Price cent Price cent Price cent Price

Dollars Dollars Dollars Dollars Dollars

Nov. 4 1.0 2.25 .1 2.80
11 .1 1.75 2.7 2.11
18 2.0 1.93 .2 1.82 1.2 1.78 1.6 1.98
25 5.6 1.64 1.1 1.38 .8 1.47 1.1 1.81


Dec. 2
9
16
23
30

Jan. 6
13
20
27

Feb. 3
10
17
24

March 3
10
17
24
31

April 7
14
21
28

May 5
12
19
26

June 2
9
16
23
30

Total
Average price


.6 1.35 1.0 1.35 .8 1.24 .7 1.35 5.0 1.32
.4 1.45 .8 1.39 3.8 1.31 .4 1.30 5.2 1.33
2.0 2.75 1.4 2.66 3.6 2.48 7.4 2.18 3.0 2.69
1.0 2.75 1.5 2.73 2.6 2.75 1.6 2.74 2.8 2.72
2.8 3.00 3.1 2.68 1.9 2.63 .7 3.00 1.2 2.70

4.1 2.64 3.1 2.61 2.1 2.60 1.6 2.60 1.8 2.46
.3 2.50 2.7 2.27 4.8 2.27 5.4 1.83 3.3 2.06
.9 1.93 4.0 2.22 2.3 2.15 4.5 2.20 2.4 2.22
3.0 2.25 4.0 2.22 3.1 2.21 3.4 2.20 1.2 2.24

.3 2.25 6.0 2.25 3.8 2.27 1.7 2.28 1.6 2.21
2.3 2.75 5.0 2.73 5.4 2.71 9.2 2.57 2.6 2.70
6.1 2.82 3.4 2.81 1.3 2.74 13.3 2.60 4.4 2.76
8.4 1.86 2.6 2.35 6.0 2.27 2.7 2.52 3.7 2.34

10.4 2.02 6.0 1.85 6.0 1.81 1.6 2.14 3.9 1.86
2.2 1.46 4.5 1.77 5.6 2.06 6.9 2.00 2.7 1.84
4.2 2.04 2.9 1.93 4.1 1.81 6.6 1.97 3.5 1.77
6.7 1.99 3.5 2.04 3.2 1.73 2.4 2.06 3.9 1.83
8.2 1.77 8.6 1.97 4.5 1.92 2.2 1.92 2.9 1.94

2.9 1.35 5.5 1.90 3.4 1.99 4.9 1.91 5.0 1.92
.6 2.50 4.3 2.32 4.2 2.30 3.8 2.34 2.4 2.31
2.6 2.36 2.0 2.35 2.6 2.43 2.9 2.36
5.0 1.96 2.3 2.16 3.2 2.00 3.9 2.23 3.8 2.18

2.8 1.96 5.4 1.87 5.3 1.88 1.3 1.99 3.6 2.03
2.6 1.55 1.9 1.92 2.9 1.82 3.0 2.00 5.6 1.97
6.3 1.61 6.1 1.98 4.3 1.78 .3 2.00 2.8 1.89
2.2 1.83 2.4 1.98 3.0 1.49 .5 1.96 2.3 1.88

2.1 1.94 1.2 1.73 1.5 1.81 7.0 1.86 2.4 1.92
2.0 2.10 1.1 2.24 2.0 2.43 .4 2.35 1.7 1.94
t 2.45 1.3 2.10 5.2 2.10
2.0 2.01 .7 2.42 t 2.10 1.6 2.52
.1 2.83


100.0


100.0


100.0


100.0


100.0


t Less than one-tenth of 1 percent.








Florida Celery Industry 53


designated market distribution areas, 11 Florida sales firms, 1962-63 season.
Market Distribution Area
Weekly
East South West South Mountain Canada Export
Central Central and Pacific
Per- Avg. Per- Avg. Per- Avg. Per- Avg. Per- Avg. Per- Avg.
cent Price cent Price cent Price cent Price cent Price cent Price

Dollars Dollars Dollars Dollars Dollars Dollars

.1 2.45 .3 2.28
1.0 2.06 .7 2.50 1.9 2.70 .6 2.16
1.5 2.25 .6 1.75 1.1 1.75 .9 1.88
1.5 1.57 .3 1.35 2.4 1.43 1.3 1.54

3.3 1.34 2.9 1.33 3.6 1.40 2.0 1.33
7.8 1.33 5.0 1.35 1.5 1.35 2.8 1.33
9.0 2.63 5.3 2.67 2.4 2.48 3.2 2.54
7.6 2.75 .1 2.75 1.9 2.71 2.1 2.74
1.9 2.99 1.1 2.92 1.4 3.08 2.0 2.75

.5 2.49 3.7 2.58 1.3 2.59 2.3 2.59
3.8 2.26 3.6 2.36 1.1 2.28 3.2 2.20
4.8 2.25 5.3 2.24 3.9 2.25 3.1 2.21
2.9 2.21 1.7 2.25 4.3 2.25 3.0 2.22

4.0 2.25 3.7 2.25 2.1 2.24 40.8 2.25 4.2 2.25
.3 2.70 1.6 2.53 9.8 2.69 12.9 2.75 5.0 2.70
1.1 2.96 8.9 2.95 3.2 2.89 3.9 2.78
7.0 2.21 3.2 2.75 3.8 2.33 4.3 2.27

2.4 2.13 4.8 2.15 6.8 1.83 5.5 1.89
2.9 2.11 4.9 2.01 5.1 1.86 5.9 1.90 4.5 1.92
2.6 1.95 4.3 2.00 18.8 2.00 3.2 1.92 5.2 2.00 3.7 1.89
2.6 1.98 5.1 1.98 3.0 1.82 3.6 1.91
2.3 1.87 3.3 1.84 2.9 2.00 5.4 1.85 5.1 1.93

3.7 1.94 4.4 1.95 4.9 1.88 10.5 1.87 4.6 1.90
3.0 2.34 .9 2.34 81.2 1.75 4.7 2.26 3.5 2.30
2.6 2.41 4.9 2.38 5.2 2.36 5.6 2.35 2.8 2.37
1.2 2.10 2.5 2.18 4.2 2.17 3.1 2.11

2.8 1.98 1.8 2.01 3.3 2.04 4.1 1.92
.2 2.00 3.8 2.01 3.3 1.91 3.0 1.90
.2 1.92 3.3 1.96 2.6 1.71 5.2 1.75 4.1 1.85
4.9 1.91 2.7 1.94 3.5 1.84 6.4 2.00 2.6 1.81

3.2 1.97 3.2 1.90 1.2 1.98 2.0 1.87
4.1 2.21 1.7 2.20 2.3 2.16 .2 2.50 1.7 2.22
.7 2.35 .7 2.05 1.2 2.11
2.5 2.54 .7 2.39
2.83

100.0 100.0 100.0 100.0 100.0 100.0
2.16 2.20 1.80 2.13 2.19 2.12







Florida Agricultural Experiment Stations


TABLE 28.-Percentage of total volume shipped and average price per crate,
by method of transportation to various market distribution areas,
I Florida sales firms, 1962-63 season.
Method of Transportation
Market Rail Truck Area
Distribution
Area Average Average Total Average
Percent Price Percent Price Percent Price
Dollars Dollars Dollars
New England 86.9 2.01 13.1 2.15 100.0 2.03
Middle Atlantic 65.6 2.10 34.4 2.25 100.0 2.15
East North Central 66.2 2.04 33.8 2.17 100.0 2.08
West North Central 51.0 2.24 49.0 2.19 100.0 2.21
South Atlantic 16.6 1.97 83.4 2.09 100.0 2.07
East South Central 13.7 2.29 86.3 2.14 100.0 2.16
West South Central 4.9 2.02 95.1 2.21 100.0 2.20
Mountain 100.0 1.75 100.0 1.75
Pacific 100.0 2.00 100.0 2.00
Canada 93.8 2.15 6.2 1.92 100.0 2.13
Export 17.5 1.89 82.5 2.26 100.0 2.19
Averaget by method 54.6 2.08 45.4 2.16 100.0 2.12
t Includes only known shipments outside of Florida.

Florida celery industry does not meet many of the conditions
assumed in this model. Conditions contributing to the celery
industry's variance from this model may be classified as (a)
natural phenomena and (b) organizational characteristics.
Natural phenomena refer to climate and cultural conditions
which permit production of celery in Florida over an extended
period when production is available from only one important
competing area outside of the state. Thus, barring a major
change in technology, Florida's peak production period cor-
responds to the period when the major competing area cannot
supply the total demand for celery.
Organizational characteristics refer to the number of sales
firms, their interrelationships, and their organization under the
Marketing Order and the Exchange. The limited number of
firms sets this industry aside from many others, but of even
more significance to its economic character is its organization
under the Marketing Order and Exchange.
These two characteristics, peculiar to the Florida celery and
sweet corn industries, introduce an element of monopoly and
seller concentration with some degree of collusion. These charac-







Florida Celery Industry


teristics, more pronounced for sweet corn than for celery because
of the degree of competition from other areas which celery faces,
are not compatible with the conditions of pure competition. It
is virtually impossible to develop a theoretical model that con-
forms in all respects to the conditions of an industry in the real
world. On the basis of results of this and a sweet corn study, it
was determined that the Florida celery and sweet corn industries
were most closely approximated by the conditions of the "or-
ganized collusive oligopoly" as discussed by Leftwich (4), or
the "collusive oligopoly selling identical products" as discussed
by Blodgett (2). These models, with certain modifications, ap-
peared to offer the most appropriate framework around which
to develop a theoretical analysis of the industry.
The validity of using the collusive oligopoly model to explain
price and output determinations depends on how well the in-
dustry in the real world conforms to the assumptions of the
theoretical model. Although it would not be expected that the
market conditions of the industry and the model would conform
perfectly, they should be approximated.
Number of Sellers.-Blodgett defines oligopoly as a "market
situation in which there are only a few sellers of some economic
good" (2). The term "a few" is difficult to define in absolute
numbers. Bain elaborates further by dividing oligopolies into
five classes based on the number of sellers and the concentration
of output (1). Bain's classification, "moderate concentration
among a few sellers with a competitive fringe," seems to be
most representative of the market conditions found in the
Florida celery industry. Bain describes this classification as
follows:
Industries where a very few sellers control the great bulk of
industry output-and a small number of small sellers divide the
remainder (1).

In the area of the Marketing Order there were 14 celery sales
firms in 1962-63.) Twelve of these were sampled and reported as
11 firms. Four large firms sold 64 percent of the celery observed.
The seven medium and small firms accounted for the remaining
36 percent. The two unsampled firms consisted of one large and
one small volume firm. Therefore, it is likely that little change
in relative percentage of volume sold by firm size would have
resulted from their inclusion in the sample. The small number







Florida Agricultural Experiment Stations


of firms and their relative sizes appear to qualify the industry
as an oligopoly by Bain's definition.
Leftwich, in discussing the number and size of firms in an
oligopoly, makes the additional point that "there are few enough
sellers of a particular product for the activities of one to be of
importance to the other ." (4). Since one of the objectives
of the Marketing Order was to control and eliminate unfair
trade practices, there appears little doubt that the activities of
one sales firm are of importance to all.
Collusion.-Leftwich defines the "organized collusive oligop-
oly" as follows:
Oligopoly of the Class 1 (this) variety consists primarily of cartel
arrangements. A cartel is a formal organization of the producers
within a given industry. Its purpose is to transfer certain manage-
ment decisions and functions of the individual firms to a central
association with the expectation that profit positions of the individual
firms will be improved by the transfer (4).
The Marketing Order and Exchange are types of cartels
operating in the celery industry in Florida. The management
decision on output level was transferred from the growers and
indirectly from the sales firms to the Advisory Committee of the
Marketing Order. The management decision of the sale price
was transferred from the sales firms to the Exchange. The
purpose of these transfers was to improve the profits of the
industry and its members. Certain other management decisions
and functions of the sales firms were transferred to the Market-
ing Order and Exchange also, but those of price and output are
most relevant to this analysis.
Identical Products.-It may be possible for a celery sales
firm to market a differentiated product in at least two ways:
(a) market a substantially different quality of celery and (b)
provide distinctive services to buyers.
While it is recognized that quality factors do vary both
within and between growers, it seems unlikely that any sub-
stantial degree of differentiation was secured by the firms
through marketing a consistently superior quality celery. All
except a few acres of the celery harvested was of the green
Utah type variety. The small amount (20 acres) of Golden type
celery harvested did not affect the market. All celery was in-
spected, precooled, and packed in standard crates. Thus, except
for loss of quality due to weather in one particular area in which







Florida Celery Industry


all celery was equally affected, celery quality can practically be
considered homogeneous during most of the season.
Services which the sales firms may offer buyers may take
several forms. Some of the more common are protection against
risks, confidence in business ethics, prompt adjustments of losses,
and credit terms on the shipments. Since most business is trans-
acted verbally and the buyer usually does not see the product
before purchase, confidence plays an important role in the
produce business. For this reason some degree of differentiation
could exist between sales firms in this manner. However, it
seems unlikely that it is large enough to alter substantially
the assumption of identical products.

Assumptions of the Analysis
It was necessary to assume prescribed time periods for
analytical purposes since the theoretical possibilities vary with
the length of time available for adjustments within the industry.
Three time periods, the short run, intermediate, and long run,
as outlined by Blodgett were used (2). The short run refers to
a period within the season after the celery has been planted.
Once planted, the quantity to be marketed cannot be changed
substantially,10 and the only relevant decision on output is
whether to sell or abandon a part of the crop. The intermediate
period roughly coincides with a planting season (July 20 to
April 30 in Florida). It is a period long enough to change the
rate of plantings and, consequently, the rate of marketable out-
put. This assumes that land is not a limiting factor in this period.
The long run is normally a period longer than a marketing
season. During this period the productive capacity of the firm
can be changed by acquiring or selling such equipment as
sprayers, harvesting machines, precoolers and, in some cases,
land.
This analysis is developed to show the combination of price
and marketable output for each time period that will maximize
profits. It is assumed that demand does not change. It is also
assumed that each time period is independent and that the
effects of action taken in one period are independent and do not
have to be considered in another. Theoretically, the analysis
develops how profits could be maximized in each time period.
0 It is realized that natural disasters may affect output in the short run.
but here reference is to a normal situation.







Florida Agricultural Experiment Stations


This does not necessarily mean that it would always be desir-
able or wise for the industry to attempt to maximize profits
as shown. For example, limitation of marketable output in one
period may limit long run growth or prompt the Commissioner
of Agriculture to intercede in the "public interest." This analysis
is intended to serve only as a guideline to show how profits could
be maximized.

Short Run
The Advisory Committee of the Marketing Order has the
authority to affect the short run supply of celery through the
use of flow-to-market regulations, harvesting holidays, and grade
restrictions. The level to which supply should be restricted is
a continuing problem for the Committee.
Maximization of Revenue.-In the short run costs become
irrelevant, since all costs, with the exception of harvesting and
marketing, have already been incurred. The only relevant de-
cision is whether to harvest and sell the crop. The short run
problem thus becomes one of how to maximize revenue with a
given potential marketable output.
In order to maximize short run net revenue the industry must
operate at the level on the demand curve where elasticity11 is at,
or as close as possible to, unity. An assumed weekly demand
schedule based on a typical price-quantity relationship during
a heavy shipment period for Florida celery is shown in the first
three columns of Table 30. In this demand schedule the most
profitable short run marketable output would be at the level
where elasticity is at unity. This level is obtained when the
marketable output is 27,000 crates and the price is $2.60 per
crate. The total industry revenue at this level is $70,200, and
if the marketable output were raised or lowered from this level,
total revenue would decline. For example, if all 37,500 crates
were sold the total revenue would drop $6,450, to a total of
$63,750.
If a schedule of marketing costs is considered as shown in
columns 4 and 5 of Table 30, then the optimum marketable
output the level where net industry revenue (column 6) would
U Elasticity is defined as the relative change in price expected or realized
from a given change in supply. For example, unit elasticity is at the point
where a relative (percentage) change in supply is accompanied by an equal
change in relative price, i.e., 1 percent, etc., resulting in no change in total
outlay for the product.







Florida Celery Industry


TABLE 30.-Estimated total and net revenue to Florida celery using assumed
weekly demand and marketing cost schedules.
Demand Schedule Marketing Cost Schedule
Price Total Marketing Total Net
Quantity Which Per Industry Cost Per Marketing Industry
Could be Sold Crate Revenue Crate Cost Revenue
Crates Dollars Dollars Dollars Dollars Dollars
18,500 3.50 64,750 1.50 27,750 37,000
21,000 3.20 67,200 1.40 29,400 37,800
24,000 2.90 69,600 1.30 31,200 38,400
27,000 2.60 70,200 1.20 32,400 37,800
30,000 2.30 69,000 1.10 33,000 36,000
33,500 2.00 67,000 1.00 33,500 33,500
37,500 1.70 63,750 .90 33,750 30,000

be maximized would be at a lower level of shipments. Net
industry revenue would now be maximized when the quantity
sold was 24,000 crates per week and the price was $2.90 per
crate. Marketing cost per crate would be $1.30, and the net
industry revenue would be $38,400.

Evaluation.-Attempts to maximize revenue by reducing
shipments in the short run have been undertaken in several
instances. Flow-to-market regulations, probably the most effec-
tive means of controlling short run supply, were invoked three
times in the 1962-63 season. These were in three successive
harvesting weeks beginning the week of March 18, 1963, with a
25 percent restriction on quantity harvested the first week, 15
percent the second week, and 20 percent the third week. Current
supply carry-over was reduced from 142,000 crates in the first
week to 79,000 in the second week, a much more manageable
supply situation. Early in the third week the 20 percent restric-
tion was lifted because the committee felt it was no longer
needed. The price of size 3 dozen celery remained at $2.00 FOB
Belle Glade throughout the period of the restriction and for two
weeks thereafter. Prices of other sizes were varied somewhat
in an effort to equalize stocks on hand. This too was successful.
Harvesting holidays were used seven times in 1962-63 and
14 times in 1963-64 to remove the pressure of "market gluts."
These were probably effective in relieving pressure on current
supplies and spreading out shipments. As a result of an un-
favorable market situation or weather risks, growers plowed
up 810 acres of celery in 1962-63 and 520 acres in 1963-64.







Florida Agricultural Experiment Stations


Therefore, it is difficult to distinguish the short run effect of
harvesting holidays from that of destroying marketable celery
in the field on a voluntary basis.
Minimum grade requirements for shipment, although per-
mitted under the Marketing Order, have not been invoked for
celery. Unless these requirements were quite stringent they
would be rather ineffective. A sample of inspection certificates
in a recent year indicated 93.6 percent of Florida celery graded
U.S. No. 1, 6.3 percent graded 75 to 89 percent of U.S. No. 1
quality, and 0.1 percent graded U.S. No. 2 (3). A limitation to
U.S. No. 1 quality would affect less than 10 percent of the total
supply in a normal season. It is believed that keeping low
quality celery in any amount off the market prevents possible
damage of the reputation of all Florida celery.

Intermediate Period-Season
The Advisory Committee has the authority to set the quan-
tity of celery that may be marketed during the Florida shipping
season. This is made possible by the provision for establishing
an annual "marketable goal" prior to the time plantings begin.
The "marketable goal" represents the total number of crates
which the industry intends to market during the marketing year.

Maximization of Profits.-The determination of the most
profitable level of price and marketable output in the inter-
mediate period is more involved than in the short run, since
costs cannot be ignored. Costs are important because that part
of the marginal cost schedule which exceeds the level where
marginal and average variable costs are equal makes up the
supply schedule for a firm. This is a schedule of quantities the
firm is willing to sell at corresponding prices.
The industry schedule is formed by a summation of the in-
dividual firm supply or marginal cost schedules. This process
is illustrated graphically in Figure 6. If it is assumed that the
industry is composed of three firms and that mcl, mc2, and mc3
represent their respective marginal cost curves, the industry
marginal cost or supply curve will be the horizontal summation
of these curves as illustrated by MC.
The principle of equating marginal cost and marginal revenue
is followed to determine the most profitable level of marketable
output for the industry. If DD represents the demand for celery
and MR the marginal revenue, then the most profitable level for







Florida Celery Industry


D







meI mIn mc I








q1 2 3 Q

Figure 6.-Optimum solution of price and marketable output in the intermediate
period.

the industry is at point b, where MC equals MR. At this level the
industry marketable output will be OQ and the price will be OP.
This solution indicates the total intermediate period output,
but does not solve the problem of what firms should produce how
much in order to maximize industry profits. In order to maxi-
mize profits at this price and output, cost must be at a minimum.
This may be accomplished only by equating the marginal cost of
all firms to that of the industry. This is illustrated in Figure 6
by line ab, which equates the marginal cost of all firms to that
of the industry at the optimum price and output level. The
marketable output of each firm is Oq1, Oq2, and Oqs, which neces-
sarily equals the industry output OQ. This is the optimum com-
bination of price, industry output, and firm output to maximize
intermediate period profits. A change in any of these factors
would cause profits to decline.
Evaluation.-The evaluation of the intermediate period will
be considered in two parts: first, the adjustment of the industry
price and output to the optimum level and second, adjustment
of the firms to the optimum output.
The extent to which marketable output is adjusted to a level
that equates industry marginal cost and marginal revenue is
that equates industry marginal cost and marginal revenue is







Florida Agricultural Experiment Stations


difficult to evaluate because of lack of adequate information.
Marginal cost and marginal revenue are not known and can
only be approximated. The 1962-63 production estimates in-
dicate that seasonal production was affected slightly, assuming
a reduction was necessary to approach the optimum output. Pro-
duction was 10,000 crates larger than in 1961-62 but considerably
below the 37,800 crate annual average increase of the 10 years
prior to the institution of the Marketing Order. If the 1963-64
season were included in the comparison, the conclusions reached
would be much different because of the substantial increase in
production in the latter season. One or two years is too short a
period to permit a valid evaluation to be made.
A look at some of the factors that may tend to inhibit inter-
mediate period output adjustments may provide an insight into
the extent that adjustments may be expected. The Marketing
Order provides that the Commissioner of Agriculture shall see
that the "public interest" is protected. Substantial exploitation
of the demand curve through marketable output limitations may
cause public reaction resulting in action against the industry
under this provision. Although this may affect marketable
output decisions under some conditions, other factors seem more
important.
The incentive for the individual firm to expand marketable
output, even though it may not be in the interest of greatest
industry profits, appears to be more important. This is illus-
trated graphically in Figure 7. If DD is the industry demand
curve, the firm demand curve will be illustrated by dd. Actually,
the total demand, DD, is composed of an aggregation of parallel
firm demand curves, dd, each representing the firm's market
share. All firm demand curves have identical slopes to that of
the industry demand curve because the Advisory Committee
determines the output at various levels on this curve. It should
be pointed out that this condition prevails only so long as the
Advisory Committee controls the output decisions, and the in-
dividual firm may not change output to exploit this sloped de-
mand curve.
If the Advisory Committee should decide that industry profits
could be increased by reducing marketable output from OQ to
OQ', then the firm must necessarily reduce its output by an
equal percentage or from Oq to Oq'. When this occurs, price
rises from OP to OP'.
When this phenomenon is considered industrywide, it means
that whenever the Advisory Committee reduces industry output,








Florida Celery Industry


D

d

MC AC
P' --------- I____- - - 1- 1-a

P I---------------------------- -- -Ib





q' q q Q'
Figure 7.-Response of the firm to an industry change in price and marketable
output.


and price rises, there is immediately, for the firms, an incentive
for expansion of the allotments since their profit would be
maximized at an output of Oq". This occurs when the price is
lower and output greater than that which would maximize in-
dustry intermediate period profits. Because of this conflict in
firm and industry interest, it is unlikely that the optimum price
and output levels will ever be reached.
A second criterion for the optimum intermediate period
solution was that quotas be assigned on the basis of each firm's
marginal cost. Present quotas are not assigned on that basis,
but on the basis of previous years' shipments. Authority to
assign quotas on the basis of marginal cost is not authorized
under the Marketing Order.
Under the present system any profits accruing to the industry
are distributed to the firms on the basis of their quotas. There-
fore, assignment of quotas on a basis other than that presently
used would involve a new system for distributing industry
profits, as well as a redistribution of production. It is unlikely
that a scheme acceptable to the industry could be found for re-
distribution of profits and production quotas, even if permissive
legislation were obtained.







Florida Agricultural Experiment Stations


Long Run
The primary authority of the Advisory Committee which is
applicable to the long run is that of limiting the entry of new
firms. This authority is not granted explicitly, but is implicit
in its authority to limit quantities that may be marketed by new
growers. A new marketing quota can be marketed through an
existing firm or through a new firm. However, due to the limited
size of new quotas, except by court order for an exception, it is
unlikely that an efficient sales firm could be established to handle
this volume.
Other barriers, exclusive of the Marketing Order, exist which
limit the entry of new firms. It would be difficult for a new
marketing firm to obtain supplies of celery, either by attracting
present growers from other sales firms or by obtaining suitable
land to go into production. The high investment necessary for
machinery and precoolers to enter the business on an economical
scale is a barrier also.
Maximization of Profits.-Two types of adjustments are
possible in the long run: (a) new firms may enter and existing
firms may exit from the industry and (b) firms may expand or
contract their productive capacity by changing the scale of their
plants. As long as the industry remains under the Marketing
Order and Exchange organizations, it does not appear that the
first type of adjustment will be of substantial importance. The
inherent barriers, plus those of the Marketing Order, should
discourage a significant entry of new firms. On the other hand,
if the Marketing Order and the Exchange operate effectively,
few, if any, firms should be forced to exit from the industry for
economic reasons. Some realignment of quotas between firms
may occur, but this would not substantially affect the economic
nature of the industry.
Adjustments in the productive capacity of the firms are of
primary long run interest to the industry. The long run problem
for the firm is to select the optimum scale of plant to handle its
volume.12 This may be analyzed theoretically by considering an
array of scale of plants, each operating at the optimum level for
a given output. If such an array of plant sizes is considered,
long run average and long run marginal cost curves can be
developed as shown in Figure 8. In order to choose the scale
"The word "plant" in this discussion refers to a production unit and/or
a marketing unit.







Florida Celery Industry


of plant from this array which would maximize profits, the firm
must equate its long run marginal cost, LRMC, with its marginal
revenue, mr. The most profitable long run solution would be for
the firm to sell quantity OQ at price OP.


LRMC


LRAC


Q
Figure 8.-Optimum solution for


plant size in the long run.


Evaluation.-Firms in the Florida celery industry will prob-
ably not approach this optimum solution very closely in the long
run because the firms are not free under the present Marketing
Order to change their marketable output. For example, if the
firm discussed in Figure 8 had a quota for less than OQ, it would
not be free to expand output to reach this optimum long run
output. It may obtain the most efficient scale plant at some
lesser output authorized by a quota and still make a profit, but
this would be less profitable than the long run optimum solution.
At some later date the Marketing Order may be amended to
allow the sale of marketable quotas, just as milk base quotas
were sold under former State Milk Commission legislation and
regulations. This would allow the optimum long run solution to
be more closely approximated.







Florida Agricultural Experiment Stations


SUMMARY
With the organization of the Florida celery industry under a
master sales exchange and the adoption of a state marketing
order, the industry has achieved standard marketing practices
along with indirect and direct production controls and some de-
gree of pricing stability.
The purpose of this study was to explain and evaluate the
organization and operation of the celery industry. It presents
a detailed analysis of the volume, distribution and prices received
by shipping area, firm size, basis of sale, type of buyer, size of
celery, weekly shipments, market distribution, and method of
transportation for the 1962-63 season, and some theoretical
guidelines for price and marketable output of the industry. Data
for the study were collected from three sources: (a) a 10 percent
sample of invoices from 12 of the 14 authorized sales firms; (b)
a sales agent questionnaire for which 12 of the 14 sales agents
were contacted; and (c) data from secondary and unpublished
sources.
The master sales organization, the Florida Fresh Produce
Exchange, was organized in April 1961. The membership of the
Exchange is composed of celery growers who have selected a
15-man board of directors. The board of directors appoints a
three-man executive committee which is given all the powers
of the board of directors. The board also hires a general manager
to handle the administrative matters of the Exchange.
The members of the Exchange, by means of growers' con-
tracts, have passed complete marketing control and title to their
celery to the Exchange. The latter, in order to market celery,
has signed handler contracts with existing and thoroughly ex-
perienced celery shippers, making them authorized sales agents
for the Exchange. These sales contracts require the agents to
abide by all rules and regulations of the Exchange, including
the selling of celery for its members at the prices established
by the Exchange.
The executive committee and the manager meet daily by
telephone to discuss market conditions and prices. At least once
each week, usually on Friday, they establish prices for the follow-
ing week for celery by sizes on an FOB Belle Glade basis. Should
market conditions warrant, these prices may be changed upward
or downward during the ensuing week. Any downward adjust-
ment effective Tuesday is retroactive to Monday sales to protect







Florida Celery Industry


early buyers. Downward adjustments after Tuesday are retro-
active to Tuesday rail sales only. Any upward adjustment in
prices is not retroactive to prior sales. The Exchange also at-
tempts to adjust volume to demand by restricting harvesting
during certain periods as the need arises.
The purpose of the Florida Celery Marketing Order, as
amended in 1962, was to improve returns to growers through a
more orderly marketing system. Specific important provisions
of the Order included: (a) quantity regulation through market-
able allotments for growers and flow-to-market regulations; (b)
quality, pack, and container regulations; and (c) advertising
and promotion of celery. The Order is administered by a 15-
member advisory committee, subject to the approval of the
Commissioner of Agriculture.
Production of celery is presently located in four areas in
Florida. Areas of major importance are: (a) Belle Glade, located
on the southeastern shores of Lake Okeechobee in western Palm
Beach County, and (b) Central Florida, located in parts of Lake,
Orange, and Seminole counties. Areas of minor importance are:
(a) West Florida, located in Sarasota County, and (b) North
Florida, located in Alachua County. Of the celery harvested in
the 1962-63 season, 78.1 percent was produced in the Belle Glade
area, 14.9 percent in Central Florida, 4.0 percent in West Florida,
and 3.0 percent in North Florida.
There were 42 separate producing firms in 1962-63. In
general, the firms producing celery in the Belle Glade area were
medium to large in size, while those of the other producing area
were of small to medium size. Nine large firms produced 78.7
percent of the state's celery in 1962-63, nine medium firms
15.6 percent, and 24 small firms 5.7 percent.
The shipping areas coincide with those of production Belle
Glade, Central Florida, West Florida, and North Florida. The
latter two were treated as one (designated as West Florida) in
this study. On the basis of the sampled data 79.9 percent of the
celery was shipped from the Belle Glade area, 11.9 percent from
Central Florida, and 8.2 percent from West Florida. Shipments
from the Belle Glade and Central Florida areas began in early
November 1962, while those from West Florida did not begin
until late in January 1963. Peak shipping months were February,
March, and April. The season ended the first week of July 1963.
Average weekly prices per crate for all Florida shipments
reacted inversely to changes in weekly volume. A change in







Florida Agricultural Experiment Stations


price of 4 cents per crate was found to be associated with an
inverse change in volume of 10,000 crates per week. This re-
lationship tends to be modified by such other factors as California
supply, supplies of competing salad vegetables, and perhaps by
climatic conditions in Florida and competing and consuming
areas of the nation.
There were eight basic sizes of celery; 30.3 percent of the
total volume was size 21/ and 28.7 percent was size 3. Sizes 2
through 4 made up 92.5 percent of the total volume shipped. A
larger percentage of the larger sizes were shipped from the
Belle Glade area, and a smaller percentage of sizes 11/2 through
3 were shipped from the Central Florida area. Shipments by
sizes from West Florida were normally distributed. Average
prices received by sizes were higher for Belle Glade and West
Florida shipments than for Central Florida shipments.
The 12 authorized sales firms sampled were grouped into
three classifications by volume shipped. The large firms shipped
64.0 percent of the volume sampled, while the small firms shipped
only 6.2 percent.
The three major bases of sale used were FOBIAA, FOBAF,
and Delivered. These bases accounted for 92.6 percent of the
total volume sampled, with Consigned sales accounting for 7.2
percent. By shipping areas, FOBAF and Delivered sales were
most important in the Belle Glade area, Consigned and Delivered
sales in Central Florida, and Consigned and FOBIAA type sales
in the West Florida area. Average prices received by shipping
area and basis of sale showed no substantial differences for the
three major bases of sale. Prices received for Consigned sales
were substantially lower in all areas.
Large firms used FOBIAA and FOBAF sales extensively,
while FOBIAA was used most extensively by the medium and
small firms. Small firms sold 27.2 percent of their volume on a
Consigned basis. Medium firms received a higher price for all
bases of sale except Consigned, while the small firms received
the lowest average price for all bases of sale.
Weekly shipments of celery by bases of sale varied by each
basis of sale. Volume of FOBAF sales was relatively stable
during most of the season, while that for FOBIAA and Delivered
bases was greatest in February, March, and April. Heaviest
Consigned sales volume was in late March, early April, and in
May. The magnitude of price fluctuations on a weekly basis
was greater for Consigned and Delivered sales than for the other







Florida Celery Industry


bases of sale. Differentials in weekly prices between average
prices by all bases of sale and Consigned sales were greater when
prices were below $2.00 than in weeks when prices were above
$2.00 per crate.
Relatively more of the 3 and 6 dozen size celery was sold
FOBAF, while 11/2, 4 and XX dozen sizes were more predomi-
nately sold on an FOBIAA basis. Sizes 2 and 21/2 dozen were sold
more on a Delivered or Consigned basis. Average prices per
crate by sizes and all bases of sale tended to be higher for the
smaller sizes of celery.
Brokers, chains, and wholesale-receivers bought 78 percent
or more of the total volume sold of any one of the five bases of
sale. Brokers were the largest purchasers on an FOBAF and
Delivered basis, while wholesale-receivers purchased the largest
volume on an FOBIAA, Consigned, and Price Arrival basis. For
all bases of sale chains paid the highest and wholesale-receivers
the lowest average price among the three major types of buyers.
During the 1962-63 season, 52.6 percent of all shipments were
made by truck and 47.4 percent by rail. Two-thirds of all FOBAF
sales were shipped by truck, while 88.9 and 71.9 percent of all
Consigned and Price Arrival sales, respectively, were shipped by
rail.
Shipments outside of Florida were made to 35 states, the
District of Columbia, and Canada, and for export outside the
continent of North America. Sales on an FOBAF basis were
greatest in the South Atlantic area, while sales on an FOBIAA
basis were less than average only in the New England and South
Atlantic areas. The two leading Consignment market areas
were the Middle Atlantic and East North Central. FOBIAA and
and Delivered sales returned the highest prices for shipments
to the Middle Atlantic area. Consigned sale prices also were
higher in the Middle Atlantic area.
The three most important types of buyers wholesale-
receivers, brokers, and chains purchased 85.8 percent of the
total volume sampled. Wholesale-receivers alone accounted for
37.8 percent of the total volume. Average prices paid by the
three leading buyers were highest at $2.18 per crate by chains,
while wholesale-receivers were lowest at $2.10 per crate. The
lower average price paid by the latter was apparently due to the
large volume of Consigned sales they handled.
Shippers in the Central and West Florida areas sold prac-
tically all of their volume to brokers, chains, wholesale-receivers,







Florida Agricultural Experiment Stations


jobbers, and the government. All other buyers purchased most
of their celery from the Belle Glade area. Average prices paid
per crate by all comparable buyers were higher in the Belle Glade
and West Florida areas than in Central Florida.
In comparing volume sold to each type of buyer by the three
firm sizes it was evident that as firm size decreased, the percent-
age of volume sold to brokers decreased, the percentage of sales
to wholesale-receivers increased, and the percentage of sales to
other types of buyers tended to decrease. Average prices paid
by the three leading types of buyers were generally higher for
the medium firms than for the large or small firms. Prices paid
by buyer type to large firms averaged generally higher than
those paid to small firms.
Weekly shipments to the three major buyer types were rela-
tively constant over the entire season. Brokers and chains pur-
chased slightly more when prices were high, while wholesale-
receivers purchased more when prices were low.
Chain repackers and processors, jobbers, brokers, and whole-
sale-receivers purchased a higher percentage of their volume in
sizes 21/% and 3 dozen. Other buyer types, except government,
purchased more size 4 dozen, while the latter preferred size 2
dozen over all other sizes. Average prices paid by the three
major buyers for the four most common sizes 2, 21/, 3, and
4 increased and then decreased as the size became smaller;
prices were highest for the 21/2 and 3 dozen sizes.
Only wholesale-receivers, among the nine buyer types, had
a larger percentage of their purchases transported by rail a
result of the high proportion of Consigned sales to that type and
and their willingness to handle straight carlot shipments. Aver-
age prices paid by all buyers were $2.16 for celery transported
by truck and $2.09 per crate for rail shipments. Much of this
difference can probably be attributed to the low price of Con-
signed sales, most of which were shipped by rail.
Wholesale-receivers accounted for the greatest volume of
purchases in all distribution areas except the South Atlantic,
Mountain, and Pacific. Processors purchased the greatest volume
in the South Atlantic area, while brokers predominated in the
Mountain, and chains in the Pacific area. Shipments to the
Middle Atlantic and East North Central areas accounted for 50.9
percent of the volume.
Interpackinghouse transactions were made to fill orders.







Florida Celery Industry


Small firms found it necessary to make more interpackinghouse
purchases than medium or large firms.
Only the Belle Glade area shipped more celery by truck than
by rail. Large and medium firms shipped less than 50 percent
by rail, while small firms shipped over 80 percent in that manner.
Similarly, prices were higher for both rail and truck shipments
by large and medium firms than by small firms. All of these
tendencies are linked to more Consigned sales by small firms.
Truck shipments were greater than rail in most weeks from
November through February and in June.
The theoretical economic model of the "collusive oligopoly
selling identical products" as explained by certain economic
theorists was found to most closely approximate the conditions
of the Florida celery industry. Number of sellers, degree of col-
lusion, and type of product did not vary appreciably from the
model. The analysis theoretically developed how profits could be
maximized in three time periods short run, intermediate
period, and long run.
In the short run costs are irrelevant, since all costs, with the
exception of harvesting and marketing, have already been in-
curred. Maximizing revenue with a given potential marketable
volume thus became the short run problem. It was determined
that revenue was maximized at a price and marketable volume
level on the demand schedule where elasticity was at, or as close
as possible to, unity. Attempts to maximize short run returns
have been made in several instances. Flow-to-market regulations
were used twice and harvesting holidays or partial holidays
seven times during the 1962-63 season. The first measure suc-
ceeded in reducing current supplies on hand and the latter in
spreading out supplies during the week.
In the intermediate period the supply schedule for a firm is
that part of the marginal cost schedule which exceeds the level
where marginal and average variable costs are equal. The in-
dustry supply schedule is formed from a summation of the in-
dividual firm supply schedules. The optimum industry price and
output combination is obtained at a level where the industry
marginal cost and marginal revenue are equated. Maximum in-
dustry profits are obtained when the marketable output of each
firm is such that the marginal costs of all individual firms are
equated with each other at the optimum level where industry
marginal cost and marginal revenue are equal.







Florida Agricultural Experiment Stations


Economic analysis indicates that it is unlikely that optimum
industry price and marketable volume levels will be reached
because of a conflict of firm and industry interest. This occurs
because each time industry output is reduced and price rises,
the incentive for the firm is to demand a larger quota. Assign-
ment of quotas to firms on the basis of marginal cost seems un-
likely, since it would involve a redistribution of industry profits
as well as production. It would, however, improve total efficiency
and promote the "public welfare" in the long run.
Entry of new firms into the industry, except by judicial
exception, does not appear to be a major factor in the long run
adjustments of the industry because of inherent barriers to
entry, plus those of the Marketing Order. Primary long run
adjustments are expected to be those of plant size. The optimum
scale plant for producing or marketing is one in which the firm's
long run marginal cost is equated with marginal revenue. Since
firms are not free to vary output under the Marketing Order,
it is questionable if the optimum long run conditions will be
closely approximated.


LITERATURE CITED

1. Bain, Joe S. Price Theory. New York: Henry Holt and Company, 1952.

2. Blodgett, Ralph H. Our Expanding Economy. New York: Rinehart and
Company, Inc., 1955.
3. Brooke, Donald L. Some Economic Problems in the Florida Celery In-
dustry. Gainesville, Florida: Florida Agricultural Experiment Station
Agricultural Economics Mimeo. Report 62-1, July 1961.

4. Leftwich, Richard H. The Price System and Resource Allocation. Rev.
ed., New York: Holt, Rinehart and Winston, March 1960.
5. Produce Reporter Company. Fruit and Produce Credit Book (The Blue
Book) Spring, 1963. Wheaton, Illinois: Produce Reporter Company,
April 1963.

6. Riggan, Wilson B. and Donald L. Brooke. Predicting the Price of Florida
Celery. Florida Agricultural Experiment Station Journal Series No.
1730, Proceedings, Florida State Horticultural Society, Vol. 76, 1963.

7. Talbott, George M. A Self-Help Program-Florida Celery Producers.
Proceedings, Agricultural Economics and Rural Sociology Section, Asso-
ciation of Southern Agricultural Workers, Vol. 1, 1962.






Florida Celery Industry









APPENDIX
Statistical Analysis of the Weekly
Price-Quantity Relationship








Florida Agricultural Experiment Stations


APPENDIX TABLE 1.-Analysis of variance of equation for first six weeks of the
1962-63 Florida season.
Source of
Variation df SS MS F
Due to
Regression 1 .853886 .853886 31.221836**
Deviation from
Regression 4 .109398 .027349
Total 5 .963284 r' = .886432
**Indicates significance at the 1 percent confidence level.

APPENDIX TABLE 2.-Analysis of variance of equation for the middle 21 weeks
of the 1962-63 Florida season.
Source of
Variation df SS MS F
Due to
Regression 1 .563791 .563791 7.192679*
Deviation from
Regression 19 1.489312 .078384
Total 20 2.053103 r = .274604
*Indicates significance at the 5 percent confidence level.

APPENDIX TABLE 3.-Analysis of variance of equation for the last eight weeks
of the 1962-63 Florida season.

Source of
Variation df SS MS F
Due to
Regression 1 .595358 .595358 13.771234**
Deviation from
Regression 6 .259393 .043232
Total 7 .854751 r- = .696527
**Indicates significance at the 1 percent confidence level.

APPENDIX TABLE 4.-Analysis of variance of equation for the entire 1962-63
Florida season.
Source of
Variation df SS MS F
Due to
Regression 1 .063610 .063610 .419339
Deviation from
Regression 33 5.005083 .151691
Total 34 5.068693 r2 = .012549







APPENDIX TABLE 5.-Analysis of covoriance.

Deviations from Regression
Item df xl 2xy Sy2 b df Zy2 (;xy)2 MS
(Slope) Zx2

First
Period 5 221.260536 -13.745233 .963284 -.06212 4 .109398 .027349
Second
Period 20 482.996704 -16.501801 2.053103 -.03417 19 1.489312 .078384
Third
Period 7 449.012314 -16.350031 .854751 -.03641 6 .259393 .043232

Within 29 1.858103 .064072
Regression
Coefficient 2 .130313 .065156
Common 32 1,153.269554 -46.597065 3.871138 -.04040 31 1.988416 .064142
Adjusted
Means 2 3.016667 1.508333

Total 34 2,516.627075 -12.652405 5.068693 -.00503 33 5.005083

F test for significance:
(1) Significant difference between the slopes of the regression lines for the three periods:
F'2a = MS Reg. Coef./MS Within = 1.016918 Tabular F', (a = .05) = 3.33
(2) Significant difference in the elevation of the regression lines for the three periods:
F' = MS Adj. Means/MS Common = 23.515528* Tabular F'si (a = .05) = 3.31
*Indicates significance at the 5 percent confidence level.






























~UR~LE)




University of Florida Home Page
© 2004 - 2010 University of Florida George A. Smathers Libraries.
All rights reserved.

Acceptable Use, Copyright, and Disclaimer Statement
Last updated October 10, 2010 - - mvs