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Costs of packing and selling Florida fresh citrus fruits
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Permanent Link: http://ufdc.ufl.edu/UF00027603/00004
 Material Information
Title: Costs of packing and selling Florida fresh citrus fruits
Series Title: <1971-72 season>-1972-73 season Economics report
Portion of title: Cost of packing and selling Florida fresh citrus fruits
Physical Description: v. : ; 27 cm.
Language: English
Creator: University of Florida -- Agricultural Economics Dept
University of Florida -- Food and Resource Economics Dept
Publisher: Dept. of Agricultural Economics, Florida Agricultural Experiment Stations, Institute of Food and Agricultural Sciences, University of Florida
Place of Publication: Gainesville
Creation Date: 1971
Frequency: annual
regular
 Subjects
Subjects / Keywords: Citrus fruit industry -- Costs -- Periodicals -- Florida   ( lcsh )
Genre: government publication (state, provincial, terriorial, dependent)   ( marcgt )
statistics   ( marcgt )
serial   ( sobekcm )
 Notes
Dates or Sequential Designation: Ceased with 1972-73 season.
Issuing Body: Issued by: Dept. of Agricultural Economics, University of Florida, <1969-70 season->; Food and Resource Economics Dept., University of Florida, <1971-72 season>-1972-73 season.
General Note: Title varies slightly.
General Note: Description based on: 1969-70 season; title from cover.
Funding: Florida Historical Agriculture and Rural Life
 Record Information
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: oclc - 23368100
lccn - 91649936
System ID: UF00027603:00004
 Related Items
Succeeded by: Estimated costs of packing and selling fresh Florida citrus

Table of Contents
    Copyright
        Copyright
    Title Page
        Title
    Table of Contents
        Page i
    Introduction
        Page 1
        Page 2
    Costs of packing and selling, 1971-72
        Page 3
        Page 4
        Page 5
        Page 6
        Page 7
        Page 8
        Page 9
        Page 10
        Page 11
        Page 12
        Page 13
        Page 14
        Page 15
    Variations in packing and selling cost among firms
        Page 16
        Page 17
        Page 18
    Trends in packing and selling cost
        Page 19
        Page 20
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





February 1973


SE0oi ,
-43


Cost of


Economics Report 43



Packing and Selling


Florida Fresh Citrus Fruits,


1971-72


Season


JHUMLVE LIbM^ T
APR 5 1973

I.F.A.S.- Univ. of Florida


Food and Resource Economics Department
Agricultural Experiment Stations
Institute of Food and Agricultural Sciences
University of Florida, Gainesville 32601


A. H. Spurlock


I














TABLE OF CONTENTS

INTRODUCTION . . . . . ..1

COSTS OF PACKING AND SELLING, 1971-72. .. . . 3

VARIATIONS IN PACKING AND SELLING COST AMONG FIRMS . ... .. .16

RELATIONSHIP OF SEASONAL VOLUME TO AVERAGE COST OF PACKING
AND SELLING . . . . .. . . .. 16

TRENDS IN PACKING AND SELLING COST . . . ... .19






LIST OF TABLES


TABLE
1 Distribution of citrus fruit handled by class of fruit,
38 packinghouses, 1971-72 . . . .

2 Percent of total fruit received which was packed for
shipment, 38 packinghouses, 1971-72 season . .

3 Volume of citrus fruit handled and total packing and
selling cost by type of container, 38 packinghouses,
1971-72 season . . . . . .

4 Weighted average costs of packing and selling Florida
citrus fruits per 1-3/5 bushel equivalent, by type of
container, 38 packinghouses, 1971-72 season . .

5 Typical distribution of administrative and general ex-
pense and other items, 38 packinghouses, 1971-72 season.

6 Relation of total volume of fruit packed to season
average packing and selling cost per 1-3/5 bushel
equivalents, 38 packinghouses, 1971-72 season . .

7 Total cost per 1-3/5 bushel equivalent for packing and
selling Florida citrus fruits, by type of pack,
1962-63 through 1971-72 season . . . .


. 2


4



7
* 4



. 7


. .15



. .17


. .18


. .













COSTS OF PACKING AND SELLING FLORIDA
FRESH CITRUS FRUITS, 1971-72 SEASON



A. H. Spurlock







INTRODUCTION

This summary is based on the accounting records of 38 citrus
packinghouses for the citrus marketing season 1971-72. Eleven of
these houses were located in the Indian River section along the East
Coast and 27 were in the Interior section.
The volume of fruit packed by the 38 packinghouses in 1971-72
amounted to 14,868,957 equivalent boxes of 1-3/5 bushels, or approxi-
mately 49 percent of the certified fresh fruit shipments. The packed
volume ranged from 23,000 to 1,187,000 boxes and averaged 391,288 boxes.
Thus, the sample packinghouses were considerably larger than the
average of all citrus packinghouses in the state. These latter
averaged only 204,761 boxes for certified fresh citrus shippers who
handled fruit from about 147 houses in 1971-72.1 Thirty-eight of these
houses shipped fewer than 10,000 boxes of 1-3/5 bushel equivalent each
and 16 were under 1,000 boxes. The average volume of 109 packers who
shipped over 10,000 boxes each was 275,167 boxes.
The distribution of fruit handled by class of fruit is shown in
Table 1. Data on direct grove-to-cannery fruit from 6 houses were




1Calculated from data in 1971-72 Season Annual Report, Division
of Fruit and Vegetable Inspection, Florida Department of Agriculture.

A. H. Spurlock is an economist in the Food and Resource Economics
Department.








not obtained.
Packed fruit represented only 34 percent of the total volume of
all houses, but was 49 percent of the East Coast houses and 31 percent
of the other houses, Fruit going direct from grove-to-cannery was 42
percent of the total of all houses, but only 28 percent of the East
Coast houses. The packed fruit of the East Coast houses consisted of
85 percent grapefruit, 13 percent oranges and 2 percent tangerines.
The Interior houses packed 36 percent grapefruit, 55 percent oranges
and 9 percent tangerines. The East Coast firms ran a larger percentage
of their total fruit through the house and, except for oranges, got a
higher percentage packout than the other group of packinghouses. The




Table 1.-Distribution of citrus fruit handled by class of fruit, 38
packinghouses, 1971-72 season


11 East Coast packinghouses
Packed fruit
Cannery fruit through house
Total through house
Direct, grove-to-cannery
Total
27 Interior packinghouses
Packed fruit
Cannery fruit through house
Total through house
Direct, grove-to-cannery
Total

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


equivalent equivalent

3,518,722 319,884 49.1
1,615,858 146,896 22.5
5,134,580 466,780 71.6
2,032,394 184,945 28.4
7,166,974 651,725 100.0


11,350,236
8,633,331
19,983,567
16,073,189
36,056,756


14,868,958
10,249,189
25,118,147
18,105,584
43,223,731


420,379
319,753
740,132
595,303
1.335.435


391,288
269,716
661,004
476,463
1,137,467


31.5
23.9
55.4
44.6
100.0


34.4
23.7
58.1
41.9
100.0


a
Grove-to-cannery fruit data not obtained from six houses. Had these
been included it would have increased the proportion going direct to
cannery.


----------


_ ~___--~.


F








packout for all fruit averaged 59.2 percent of the total received by
the house, with 68.4 percent for the East Coast houses and 56.9 percent
for Interior houses (Table 2).


Table 2.-Percent of total fruit received which was packed for ship-
ment, 38 packinghouses, 1971-72 season

Kind of fruit East Coast Interior All
houses houses houses
Percent Percent Percent

Oranges 52.5 54.5 54.4
Grapefruit 71.7 58.9 63.7
Tangerines 74.5 64.8 65.1
All fruit 68.4 56.9 59.2


COSTS OF PACKING AND SELLING, 1971-72

The cost data made available by the fresh fruit packinghouses
showed the itemized expenses of each for 1971-72 together with the
boxes of fruit handled by kind of fruit and type of container. Distri-
bution of the various items of cost to each kind of fruit and each
container was usually made by the firms' own accountants or by outside
auditors. For a few packinghouses which had only incomplete distributions
or only total costs by items of expense, allocations, using average ratios
based on labor requirements, were made to each pack. Thus, there were
several different methods of cost allocations used in the original
data from which the averages were derived. Methods used for distributing
materials costs and general and administrative and selling expenses
appeared to be similar, but labor and other direct operating costs were
allocated by various methods. In some of the packinghouses a pro-
portion of the labor for receiving and dumping and for grading was
allocated to the fruit graded out for canneries (eliminations). A few
of the houses also charged a small amount of labor not otherwise listed to
eliminated fruit. Any other direct operating expenses allocated to the
eliminated fruit were at a lower per-box rate than to the packed fruit.
In a large number of the houses the eliminated fruit was charged prin-
cipally with administrative expenses at the same rate as fruit going
direct from grove-to-cannery.








The total volume of citrus fruit handled by type of container
and kind of fruit is shown in Table 3. The number of sample houses
using each container is also shown with the total cost of packing and
selling. Packing and selling costs for those containers handled in low
volume by a small number of houses are not considered representative as

they may reflect unusual conditions and costs. Itemized costs for the
principal packs are treated in subsequent tables.
The 38 packinghouses prepared a total of 32 different packs of
fruit plus a mixed group of miscellaneous containers for each kind of

fruit. This is a wide reduction from the practice prior to 1968-69 in



Table 3.-Volume of citrus fruit handled and total packing and selling
cost by type of container, 38 packinghouses, 1971-72 season

Sample Volume Total
Sample pack and
Commodity and type of container Total Average sell per
firms per firm box
No. ---1-3/5 bushel equivalent---


Oranges
4/5 bu. fiberboard
5-1b. vexar bag in
5-lb. poly.'.bag in
4/5 bu. Bruce box
Bulk
4/5 bu. Bruce-flat
4/5 bu. fiberboard
8-lb. poly. bag in
8-lb. vexar bag in
Field box
4/5 bu. fiberboard
2/5 bu. fiberboard


carton
master carton
master carton



carton-white
master carton
master carton

carton-export
carton


Miscellaneous containers
Total packed oranges


4,004,873
919,238
799,470
514,862
139,367
123,623
236,605
59,694
44,310
31,585
21,039
2,661
6,628
6.633.955


108,240
38,302
28,552
25,743
12,670
61,812
78,868
2,595
2,014
3,948
7,013
665
1,105
179.296


$1.8136
2.4065
2.2666
2.2051
1.1326
2.2328
1.6419
2.2099
2.2962
1.1400
1.7927
1.8168
1.4636
$1.9467


Grapefruit
4/5 bu. fiberboard
5-lb. poly. bag in
5-lb. vexar bag in
Bulk
Field box
4/5 bu. fiberboard
8-lb. poly. bag in
4/5 bu. fiberboard
8-lb. vexar bag in
4/5 bu. Bruce box


carton
master carton
master carton


carton-export
master carton
carton-white
master carton


4/5 bu. Bruce box-export
Miscellaneous containers
Total packed grapefruit


5,333,103
944,031
476,743
121,441
49,015
47,304
16,359
8,140
5,401
3,058
654
2,798
7.008.047


140,345
31,468
19,864
11,040
6,127
11,826
861
2,713
338
383
327
560
184.422


$1.7187
2.0884
2.3095
1.1114
.9674
1.5109
2.1129
1.4588
2.1770
1.8690
1.8479
.9853
$1.7922
Continued


c"


v


; --1-


~--- ~


--









Table 3.-Volume of citrus fruit handled and total packing and selling
cost by type of container, 38 packinghouses, 1971-72 season
--rnnt ntnpd


Tangerines
4/5 bu. Bruce box
4/5 bu. fiberboard box
4/5 bu. Bruce-flat
4/5 bu. fiberboard carton-white
Bulk
5-lb. poly. bag in master carton
Bushel basket
Field box
5-lb. vexar bag in master carton
Miscellaneous containers
Total packed tangerines
Miscellaneous varieties
Miscellaneous containers
Total packed fruit
Bulk fruit through house to cannery
Oranges
Grapefruit
Tangerines
Miscellaneous varieties
Total bulk through house
Other
Direct, grove-to-cannery
Total all fruit


382,944
355,213
187,020
174,884
6,980
5,354
2,009
504
226
872
1,116,006


21,275
16,146
62,340
58,295
2,327
5,354
2,009
252
226
436
37,200


$2.4680
2.1437
2.6568
1.8568
1.5260
2.3114
2.5996
1.2520
2.4223
1.3177
$2.2928


4 110,950 27,738 $2.0076
38 14,868,958 391,288 $1.9038
*


5,562,998
3,988,674
586,096
111,421
10.249,189


150,351
104,965
20,210
276855
269.716


$0.2422
.1834
.3107
.0648
$0.2211


31 18,105,584 584,051 $0.0641
38 43,223,731 1,137,467 $0.7659


the kinds of packages used. It follows an industry decision to eliminate
some package types. The 4/5 bushel fiberboard box, in several variations,
was the most important container used for oranges and grapefruit in
1971-72; it carried 64 percent of the oranges and 77 percent of the
grapefruit. Most of the remaining oranges and grapefruit were packed
in polyethylene or vexar bags and placed in fiberboard master containers.
Fifty-one percent of the tangerines were packed in two types of 4/5
bushel wire-bound boxes, with fiberboard boxes being used for 47 percent.
Itemized costs of packing and selling oranges, grapefruit and
tangerines for the 1971-72 season are given in Table 4 for 38 packing-
houses. This table shows the weighted average costs for the major items
of expense by type of pack, together with the number of firms packing
each container and the average volume per house using each. Only the








more important packs are included in these detailed tables, but they
represent 95 percent of the packed fruit.
Costs of handling cannery fruit direct-from-grove also are shown
in Table 4. This operation was not separated by kind of fruit, but
represents a mixture of all kinds.
Costs for the principal packs handled by the East Coast houses
are shown separately from the other houses. The principal reason for
separating the two sections is that the East Coast houses generally
used a heavier fiberboard box which cost about 5 or 6 cents more than
the one used by the Interior houses.
All of the 38 packinghouses in the sample did not use every
container listed in Table 4. Thus, the costs shown for any container
are averages of the group of firms packing that container. Since this
grouping of houses and the volume-weights change with each container,
some of the differences in costs between various packs are due to these
variations in the sample.
The average costs shown in each category are weighted averages
for the packinghouses included, i.e., the total money cost of each
item for all houses was divided by the total number of boxes packed.
The use of weighted averages in this summary usually tends to show the
cost of packing and selling at figures lower than the simple average.
This is true because the larger houses, which usually had somewhat
lower costs, affect the average more than smaller houses. For example,
the weighted average costs of packing and selling oranges in the 4/5
bushel fiberboard box by 37 firms was $1.8136, or $0.0767 lower than
the simple average of $1.8903. Eighteen firms had total costs lower
than the weighted average and 19 had higher costs.
The cost of selling as shown in Table 4 includes brokerage.
Statements from a few large firms showed brokerage in addition to their
own sales department expense. Firms selling through a separate sales
organization incurred only one charge, which covered brokerage. For a
few other firms with no data on brokerage cost an estimated amount was
added in an attempt to make the selling cost more comparable among all.
Brokerage cost averaged approximately 35 percent of the total selling
cost for those reporting this item, and was the basis of estimating
this cost for firms with no data. The actual brokerage cost to a firm,








Table 4.-Weighted average costs of packing and selling Florida citrus
fruits per 1-3/5 bushel equivalent, by type of container, 38
packinghouses, 1971-72 season
Part A--Oranges


Type of container


Number of packinghouses
Average volume packed
(1-3/5 bushel equivalent)
Item of cost
Materials
Containers
Other materials
Total materials
Labor
Receive, truck, dump
Cratemaking & labeling
Foremen, graders, others
Packing
Truck, check, load
Payroll taxes, comp. ins.
Total labor
Other direct operating
Power, lights, water
Repairs & maintenance
Misc. supplies & expense
Total other direct
Indirect operating
Insurance-fire & casualty
Taxes & licenses
Depreciation
Rent
Total indirect operating

Total packing expense
Administrativea
Selling
Other items


5-lb. poly 8-lb.poly 5-lb. vexar 8-1b.vexar
bag in bag in bag in bag in
master master master master
carton carton carton carton
28 23 24 22

28,552 2,595 38,302 2,014
----Cost per 1-3/5 bushel equivalent-------


$0.7595
.0165
$0.7760


$0.7983
.0126
$0.8109


$0.9152
.0158
$0.9310


$0.8606
.0134
$0.8740


$0.0443 $0.0411 $0.0421 $0.0392
.0663 .0657 .0641 .0647
.1936 .1968 .1902 .1897
.2237 .1984 .2210 .2066
.0969 .0909 .0940 .0927
.0760 .0690 .0750 .0674
$0.7008 $0.6619 $0.6864 $0.6603

$0.0270 $0.0264 $0.0269 $0.0265
.0836 .0864 .0858 .0880
.0420 .0358 .0400 .0338
$0.1526 $0.1486 $0.1527 $0.1483

$0.0165 $0.0138 $0.0187 $0.0147
.0197 .0172 .0225 .0190
.1057 .0876 .1186 .1014
.0117 .0090 .0056 .0031
$0.1536 $0.1276 $0.1654 $0.1382

$1.7830 $1.7490 $1.9355 $1.8208
.0880 .0885 .0807 .0915
.1501 .1319 .1472 .1400
.2455 .2405 .2431 .2439


Total packing and selling $2.2666 $2.2099 $2.4065 $2.2962
Range in total costs-low $1.7905 $1.8285 $1.9718 $1.9216
--high 3.5023 3.4911 3.9477 3.9154
Standard deviationd .3586 .2974 .4468 .4388
See footnotes at end of table.


- --


c









Table 4.-Weighted average costs of packing and selling Florida citrus
fruits per 1-3/5 bushel equivalent, by type of container, 38
packinghouses, 1971-72 season-Continued
Part A--Oranges

4/5 bu. Bruce box
Type of container East Coast Interior All houses
houses
Number of packinghouses 3 17 20
Average volume packed
(1-3/5 bushel equivalent) 9,087 28,682 25,743
Item of cost ------Cost per 1-3/5 bushel------


Materials
Containers
Other materials
Total materials
Labor
Receive, truck, dump
Cratemaking & labeling
Foremen, graders, others
Packing
Truck, check, load
Payroll taxes, comp. ins.
Total labor
Other direct operating
Power, lights, water
Repairs & maintenance
Misc. supplies & expense
Total other direct operating
Indirect operating
Insurance-fire & casualty
Taxes and licenses
Depreciation
Rent
Total indirect operating

Total packing expense
Administrative
Selling
Other items


$0.7835
.0617
$0.8452


$0.7813
.0256
$0.8069


$0.7814
.0275
$0.8089


$0.0295 $0.0465 $0.0457
.1013 .0760 .0774
.2452 .1440 .1493
.1969 .1516 .1540
.1343 .1048 .1063
.0803 .0600 .0610
$0.7875 $0.5829 $0.5937

$0.0168 $0.0237 $0.0233
.0540 .0746 .0735
.0240 .0394 .0387
$0.0948 $0.1377 $0.1355

$0.0137 $0.0167 $0.0165
.0166 .0227 .0224
.0427 .1208 .1167
.0000 .0032 .0030
$0.0730 $0.1634 $0.1586

$1,8005 $1.6909 $1.6967
.1412 .0847 .0877
.1600 .1586 .1587
.4233 .2530 .2620


Total packing and selling $2.5250 $2.1872 $2.2051

Range in total costs--low $2.2448 $1.8329 $1.8329
-high 2.5948 2.8125 2.8125
Standard deviation .0486 .3084 .3097


See footnotes at end of. table.


---`


Continued









Table 4.-Weighted average costs of packing and selling Florida citrus
fruits per 1-3/5 bushel equivalent, by type of container, 38
packinghouses, 1971-72 season-Continued
Part A--Oranges

4/5 bu. fiberboard box
Type of container East Coast Interior All houses
houses
Number of packinghouses 10 27 37
Average volume packed
(1-3/5 bu. equivalent) 39,568 123,673 108,240
Item of cost ---------Cost per 1-3/5 bushel----


Materials
Containers
Other materials
Total materials
Labor
Receive, truck, dump
Cratemaking & labeling
Foremen, graders, others
Packing
Truck, check, load
Payroll taxes, comp. ins.
Total labor
Other direct operating
Power, lights, water
Repairs & maintenance
Misc. supplies & expense
Total other direct operating
Indirect operating
Insurance-fire & casualty
Taxes and licenses
Depreciation
Rent
Total indirect operating

Total packing expense
Administrativea
Selling
Other items


$0.4818
.0275
$0.5093


$0.4212
.0198
$0.4410


$0.4257
.0204
$0.4461


$0.0423 $0.0427 $0.0427
.0456 .0718 .0697
.2125 .1749 .1779
.1660 .1338 .1363
.0913 .1094 .1080
.0938 .0664 .0686
$0.6515 $0.5990 $0.6032

$0.0280 $0.0236 $0.0239
.0891 .0698 .0714
.0408 .0373 .0376
$0.1579 $0.1307 $0.1329

$0.0210 $0.0154 $0.0158
.0251 .0219 .0221
.0921 .1117 .1102
.0005 .0056 .0052
$0.1387 $0.1546 $0.1533
$1.4574 $1.3253 $1.3355
.1054 .0799 .0820
.1641 .1441 .1457
.2863 .2473 .2504


Total packing and selling $2.0132 $1.7966 $1.8136

Range in total costs--low $1.8049 $1.4013 $1.4013
--high 2.3205 2.7828 2.7828
Standard deviations .1040 .2658 .2635


Continued


I~


See footnotes at end of table. .








Table 4.--Weighted average costs of packing and selling Florida citrus
fruits per 1-3/5 bushel equivalent, by type of container, 38
packinghouses, 1971-72 season-Continued
Part A--Oranges

Bulk Bulk through house to cannery
Type of container in East Coast Interior All houses
truck houses
Number of packinghouses 11 10 27 37
Average volume packed
(1-3/5 bushel equivalent) 12,670 42,323 190,362 150,351
Item of cost -----Cost per 1-3/5 bushel equivalent---------


Materials
Containers
Other materials
Total materials
Labor
Receive, truck, dump
Cratemaking & labeling
Foremen, graders, others
Packing
Truck, check, load
Payroll taxes, comp. ins.
Total labor
Other direct operating
Power, lights, water
Repairs & maintenance
Misc. supplies & expense
Total other direct
Indirect operating
Insurance-fire & casualty
Taxes & license
Depreciation
Rent
Total indirect operating


Total packing expense
Administrativea
Selling
Other items


$0.0000
.0039
$0.0039


$0.0000
.0000
$0.0000


$0.0000
.0000
$0.0000


$0.0000
.0000
$0.0000


$0.0308 $0.0202 $0.0247 $0.0243
.0088 .0000 .0000 .0000
.1426 .0657 .0464 .0479
.0727 .0000 .0000 .0000
.0480 .0057 .0020 .0023
.0443 .0132 .0164 .0162
$0.3472 $0.1048 $0.0895 $0.0907

$0.0200 $0.0064 $0.0055 $0.0055
.0760 .0264 .0365 .0358
.0359 .0062 .0077 .0076
0. 1319 $0.0390 $0.0497 $0.0489

$0.0233 $0.0098 $0.0065 $0.0067
.0182 .0073 .0044 .0047
.0919 .0147 .0245 .0238
.0031 .0000 .0020 .0018
$0.1365 $0.0318 $0.0374 $0.0370

$0.6195 $0.1756 $0.1766 $0.1766
.0815 .1127 .0616 .0654
.1565 .0000 .0000 .0000
.2751 .0002 .0001 .0002


Total packing and selling $1.1326 $0.2885 $0.2383 $0.2422
Range in total costs--low $1.0146 $0.0842 $0.0361 $0.0361
--high 1.7034 .4272 .5938 .5938
Standard deviation d .1742 .1267 .1563 .1548


See footnotes at end of table.


Continued








Table 4.--Weighted average costs of packing and selling Florida citrus
fruits per 1-3/5 bushel equivalent, by type of container, 38
packinghouses, 1971-72 season-Continued
Part B--Grapefruit

5-1b,poly 8-1b. poly 5-lb. vexar 8-lb. vexar
Type of container bag in bag in bag in bag in
master master master master
carton carton carton carton
Number of packinghouses 30 19 24 16
Average volume packed
(1-3/5 bushel equivalent) 31,468 861 19,864 338
Item of cost ------Cost per 1-3/5 bushel equivalent-----


Materials
Containers
Other materials
Total materials
Labor
Receive, truck, dump
Cratemaking & labeling
Foremen, graders, others
Packing
Truck, check, load
Payroll taxes, comp. ins.
Total labor
Other direct operating
Power, lights, water
Repairs & maintenance
Mics. supplies & expense
Total other direct
Indirect operating
Insurance-fire & casualty
Taxes & licenses
Depreciation
Rent
Total indirect operating

Total packing expense
Administrative
Selling
Other items
Total packing and selling


$0.7326
.0204
$0.7530


$0.8060
.0130
$0,8190


$0.9361
.0182
$0.9543


$0.8322
.0162
$0.8484


$0.0386 $0.0403 $0.0412 $0.0420
.0596 .0677 .0633 .0689
.1630 .1860 .1744 .1822
.1911 .1550 .2028 .1726
.0844 .0927 .0886 .0947
.0700 .0544 .0688 .0662
$0.6067 $0.5961 $0.6391 $0.6266

$0.0257 $0.0274 $0.0253 $0.0274
.0711 .0769 .0729 .0771
.0437 ,0436 .0427 .0385
$0.1405 $0.1479 $0.1409 $0.1430

$0.0132 $0.0149 $0.0121 $0.0120
.0177 .0170 .0178 .0182
.0899 .0918 .0920 .0995
.0026 .0009 .0032 .0019
$0.1234 $0.1246 $0.1251 $0.1316

$1.6236 $1.6876 $1.8594 $1.7496
.1137 .1083 .1130 .1042
.1453 .1269 .1390 .1264
.2058 .1901 .1981 .1968
$2.0884 $2.1129 $2.3095 $2.1770


See footnotes at end of table.


Range in total costs--low $1.7603 $1.7481 $1.9651 $1.8260
--high 2.9283 2.7990 3.6792 3.0276
Standard deviations .2251 .2219 .3038 .2804


Continued








Table 4.-Weighted average costs of packing and selling Florida citrus
fruits per 1-3/5 bushel equivalent, by type of container, 38
packinghouses, 1971-72 season-Continued
Part B- Grapefruit

4/5 bushel fiberboard box Fld
Type of container East Interior All box
box
Coast houses houses
Number of packinghouses 11 27 38 8
Average volume packed
(1-3/5 bushel equivalent) 244,484 97,917 140,345 6,127
Item of cost -----Cost per 1-3/5 bushel equivalent------


Materials
Containers
Other materials
Total materials
Labor
Receive, truck, dump
Cratemaking & labeling
Foremen, graders, others
Packing
Truck, check, load
Payroll taxes, comp. ins.
Total labor
Other direct operating
Power, lights, water
Repairs & maintenance
Misc. supplies & expense
Total other direct
Indirect operating
Insurance-fire & casualty
Taxes & licenses
Depreciation
Rent
Total indirect operating

Total packing expense
Administrative
Selling
Other items


$0.4712
.0400
CAn 11 1


$0.4181
.0139
sn A/3n


$0.4447
.0271
cn A718A


$0.0000
.0000
0n nnnn


y.I*. .. YS.T.2 9V.2 .,

$0.0437 $0.0377 $0.0408 $0.0370
.0470 .0632 .0550 .0001
.1915 .1176 .1550 .1964
.1203 .1140 .1172 .0260
.1029 .0854 .0942 .1022
.0770 .0523 .0648 .0609
$0.5824 $0.4702 $0.5270 $0.4226

$0.0200 $0.0214 $0.0207 $0.0173
.0704 .0575 .0640 .0649
.0322 ,0419 .0370 .0409
$0.1226 $0.1208 $0.1217 $0.1231

$0.0163 $0.0091 $0.0128 $0.0088
.0148 .0151 .0150 .0067
.0669 .0767 .0717 .0598
.0003 .0043 .0022 .0158
$0.0983 $0.1052 $0.1017 $0.0911

$1.3145 $1.1282 $1.2222 $0.6368
.1054 .1144 .1098 .0713
.1639 .1520 .1580 .0627
.2541 .2028 .2287 .1966


See footnotes at end of table.


Total packing and selling $1.8379 $1.5974 $1.7187 $0.9674

Range in total costs--low $1.6122 $1.3390 $1.3390 $0.8537
-high 2.1467 2.1936 2.1936 1.4338
Standard deviationd .1613 .2307 .2329 .0979


Continued









Table 4.-Weighted average costs of packing and selling Florida citrus
fruits per 1-3/5 bushel equivalent, by type of container, 38
packinghouses, 1971-72 season-Continued
Part B- Grapefruit

Bulk Bulk through house to cannery
Type of container in East Interior All
truck Coast houses houses
Number of packinghouses 11 11 27 38
Average volume packed
(1-3/5 bushel equivalent) 11,040 106,595 104,301 104,965
Item of cost -----Cost per 1-3/5 bushel equivalent------


Materials
Containers
Other materials
Total materials
Labor
Receive, truck, dump
Cratemaking & labeling
Foremen, graders, others
Packing
Truck, check, load
Payroll taxes, comp. ins.
Total labor
Other direct operating
Power, lights, water
Repairs & maintenance
Misc. supplies & expense
Total other direct
Indirect operating
Insurance-fire & casualty
Taxes & licenses
Depreciation
Rent
Total indirect operating

Total packing expense
Administrative
Selling
Other items


$0.0000
.0002
$0.0002


$0.0000
.0000
$0.0000


$0.0000
.0000
$0.0000


$0.0000
.000
$0.0000


$0.0285 $0.0110 $0.0153 $0.0140
.0006 .0000 .0000 .0000
.1366 .0324 .0203 .0238
.0862 .0000 .0000 .0000
.0496 .0040 .0010 .0019
.0379 .0062 .0067 .0066
$0.3394 $0.0536 $0.0433 $0.0463

$0.0125 $0.0034 $0.0029 $0.0030
.0416 .0127 .0163 .0153
.0167 .0042 .0053 .0050
$0.0708 $0.0203 $0.0245 $0.0233

$0.0116 $0.0026 $0.0025 $0.0026
.0110 .0028 .0029 .0028
.0415 .0060 .0127 .0107
.0001 .0000 .0009 .0007
$0.0642 $0.0114 $0.0190 $0.0168

$0.4746 $0.0853 $0.0868 $0.0864
.1295 .1060 .0927 .0966
.1623 .0000 .0000 .0000
.3450 .0002 .0005 .0004


Total packing and selling $1.1114 $0.1915 $0.1800 $0.1834
Range in total costs--low $0.8077 $0.0496 $0.0361 $0.0361
--high 1.3067 .3462 .4312 .4312
Standard deviation .1342 .0982 .0895 .0923


See footnotes at end of table.


Continued


--








Table 4.-Weighted average costs of packing and selling Florida citrus
fruits per 1-3/5 bushel equivalent, by type of container, 38
packinghouses, 1971-72 season-Continued
Part C-Tangerines and all fruit direct to cannery

Tangerines All fruit
4/5 u Bulk Direct
Type of container rue 4/5 bu. house grove
Bruce
x carton to to
box
cannery cannery
Number of packinghouses 18 22 29 31
Average volume packed
(1-3/5 bushel equivalent) 21,275 16,146 20,210 584,051


Item of cost
Materials
Containers
Other materials
Total materials
Labor
Receive, truck, dump
Cratemaking & labeling
Foremen, gradres, others
Packing
Truck, check, load
Payroll taxes, comp. ins.
Total labor
Other direct operating
Power, lights, water
Repairs & maintenance
Misc. supplies & expense
Total other direct
Indirect operating
Insurance-fire & casualty
Taxes & licenses
Depreciation
Rent
Total indirect operating

Total packing expense
Administrativea
Sellingb
Other items


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


$0.7714 $0.4645 $0.0000
.0289 .0195 .0000


$0.0000
.0000


$0.8003 $0.4840 $0.0000 $0.0000

$0.0561 $0.0607 $0.0255 $0.0028
.0711 .0656 .0000 .0000
.1934 .2534 .0629 .0002
.2191 .1905 .0000 .0000
.1083 .1147 .0018 .0000
.0811 .0916 .0190 .0003
$0.7291 $0.7765 $0.1092 $0.0033

$0.0352 $0.0439 $0.0091 $0.0002
.1174 .1169 .0467 .0030
..0396 .0354 .0094 .0002
$0.1922 $0.1962 $0.0652 $0.0034

$0.0367 $0.0243 $0.0117 $0.0002
.0287 .0253 .0077 .0001
.2041 .1182 .0329 .0006
.0004 .0030 .0009 .0000
$0.2699 $0.1708 $0.0532 $0.0009

$1.9915 $1.6275 $0.2276 $0.0076
.1040 .1038 .0824 .0561
.1364 .1661 .0000 .0003
.2361 .2463 .0007 .0001


Total packing and selling $2.4680 $2.1437 $0.3107 $0.0641

Range in total cost--low $1.9090 $1.7000 $0.0361 $0.0131
--high 3.3102 3.5492 1.0709 .1808
Standard deviations .4946 .2532 .2552 .0342


aAdministrative expense includes management and office salaries,
office expense, auto and travel, interest paid, telephone and telegraph.
b ling includes sales salaries, travel, telephone and telegraph
Selling includes sales salaries, travel, telephone and telegraph








however, depends upon the extent that brokers are used in the selling
process.
In the detailed cost analysis in Table 4 administrative and gen-
eral costs were condensed into one item; a group of expenses shown as
"other items" was also reduced to one line. A typical distribution
of these groups of expenses is shown in Table 5. Some of the items
such as waxing, degreening and color-add appear lower in cost per box
than the cost of the services, but not all fruit was so treated. Total
expenditure for any item or service was divided by the whole number of
boxes packed.


Table 5.-Typical distribution of administrative and general expense
and other items, 38 packinghouses, 1971-72 season

Oranges Grapefruit Tangerines
Expense items 4/5 bu. 4/5 bu. 4/5 bu.
fiberboard fiberboard Bruce
Cost.per 1-3/5 bushel equivalent'
Administrative & general expense
Management & office supplies $0.0474 $0.0578 $0.0572
Office supplies and expense .0049 .0063 .0049
Auto & travel, entertainment .0030 .0073 .0031
Operating interest .0061 .007'8 .0136
Telephone & telegraph .0030 .0055 .0032
Miscellaneous administrative .0176 .0251 .0220
Total administrative & general $0.0820 $0.1098 $0.1040
Other items
Degreening, color-add & wax $0.0587 $0.0358 $0.0389
Precooling .0083 .0183 .0174
Florida citrus advertising tax .0995 .0798 .0697
Federal-State inspection .0624 .0628 .0614
Florida Citrus Mutual .0074 .0074 .0075
Growers Administrative Committee .0029 .0031 .0028
Miscellaneous other .0112 .0215 .0384
Total other items $0.2504 $0.2287 $0.2361


and brokerage.
cOther items include Florida citrus advertising tax, Federal state
inspection, precooling, coloring and waxing and various industry assess-
ments.
A range of one standard deviation above and below the total
average packing and selling cost usually includes about two-thirds of
the observations. Ninety-five percent of the firms are within the
range of two standard deviations from the average total cost.








VARIATIONS IN PACKING AND SELLING COST AMONG FIRMS

There was a wide variation among firms in the cost of packing and
selling citrus in 1971-72. This occurs each season and is due to a
variety of factors, most of which cannot be identified from accounting
summaries of operations. Some of the variation may be due to the
method of allocating aggregate costs to each pack. An index is prepared
annually to eliminace the effect of this allocation on each firm's
overall costs.
In Table 4, below the total cost of packing and selling, is given
the extreme range in total costs among all the firms having each pack.
however, only a few firms are near either extreme; most fall within a
narrower range about the average cost. To delineate this group the
standard deviation has been given for each total cost. The standard
deviation added to and subtracted from the average total cost should
give a range within which the total average costs for about two-thirds
of the firms fall. Two times the standard deviation added to and sub-
tracted from the total cost indicates a range that will include the
costs for about 95 percent of the firms.


RELATIONSHIP OF SEASONAL VOLUME TO AVERAGE
COST OF PACKING AND SELLING

The data indicate some relationship between the seasonal volume
of fruit handled and the total packing and selling cost. Houses with
the largest volumes had the lowest unit costs.
Packinghouses in the smallest volume group (under 200,000 packed
boxes) had costs for packing and selling oranges in 4/5 bushel fiber-
board boxes of 18.2 cents more than the average for all houses. The
next larger group (200,000 to 399,999 boxes) also had about the same
cost differential. Houses in the largest group (600,000 & over packed
boxes) had costs 28 cents below the average of all houses. Costs for
the largest volume houses were 46 cents lower than the smallest volume
groups (Table 6).
For packing and selling grapefruit in 4/5 bushel fiberboard boxes,
houses in the smallest volume group had total costs of 7.9 cents above
the average cost, while those in the largest volume group had costs of
28.6 cents per box below the average. The largest houses were 36 cents








Table 6.-Relation of total volume of fruit packed to season average
packing and selling cost per 1-3/5 bushel equivalents, 38
packinghouses, 1971-72 season
Part A-Oranges in 4/5 bushel fiberboard boxes

Total packing
Volume group Average volume Firms & selling cost
1,000 boxes 1,000 boxes Number Dollars
Under 200 98 7 $1.9952
200 to 399 315 17 1.9976
400 to 599 506 8 1.8362
600 & over 892 5 1.5368
All groups 393 37 $1.8136


Part B-Grapefruit in 4/5 bushel fiberboard boxes

Total packing
Volume group Average volume Firms & selling cost
1,000 boxes 1,000 boxes Number Dollars
Under 200 98 7 $1.7974
200 to 399 315 18 1.7669
400 to 599 506 8 1.6738
600 & over 892 5 1.4331
All groups 391 38 $1.7187


per box lower in cost than those in the smallest group (Table 6).
The cost data in Table 6 are weighted averages of the observations.
Some of the cost differences among size groups are due to unavoidable
sample changes this year. However. diverse changes in composition and
volume of output occur each year with a constant sample.
The relationship between total volume of fruit through the house
and the cost per box is imperfect because important faci-rs affecting
costs may be unequally distributed in the volume groups. Som, of these
are length of season or number of days operated,.percent of house cL'-acity
used, investment in packinghouse assets, and extent of mechanization
which affects labor costs. The number of different lots, frequency of
change of lots, number of different containers packed, and percent pack-
out probably affect costs also to some extent. There was not sufficient
information on all these factors to account for the effect of each on costs.








TRENDS IN PACKING AND SELLING COST

The trend in total cost of packing and selling Florida citrus
fruits in the most common containers during the past 10 seasons has
been generally upward (Table 7). The trend is uneven because of
fluctuating total volume packed each season, but cost components,
especially labor and equipment costs, have continued to rise. In 1971-72
only very slight increases occurred in the principal container (4/5 bu.
cartons) and some packs showed a small decrease.
Since 1969-70 brokerage expense, which was omitted in prior years,
has been included in selling cost. The amount of brokerage varies
somewhat with pack but averaged $0.0455 per box for all packed fruit
in 1969-70, $0.0476 in 1970-71 and $0.0541 in 1971-72.









Table 7.--Total cost per 1-3/5 bushel equivalent for packing and selling
Florida citrus fruits, by type of pack, 1962-63 through
1971-72 season

4/5 u 4/5 bu. 5-lb. poly 8-lb. poly 5-lb.vexar 8-lb.vexar
S fiber- bag in bag in bag in bag in
Season Bruce
s board master master master master
box
o box carton carton carton carton
------------------------------------------------------------

1962-63 $1.73 $1.50 $1.96 -
1963-64 1.64 1.42 1.88 -
1964-65 1.59 1.44 1.74 -
1965-66 1.64 1.49 1.88 -
1966-67 1.67 1.48 1.87 $1.99 $1.76

1967-68 1.83 1.57 2.02 2.27 2.12
1968-69 1.94 1.64 2.14 2.30 2.16
1969-70 2.08 1.76 2.25 $2.21 2.35 2.30
1970-71 2.20 1.78 2.23 2.42 2.42 2.33
1971-72 2.21 1.81 2.27 2.21 2.41 2.30

-----------------------------Grefruit-----------------------------
1962-63 $1.48 $1.29 $1.77 $1.69 -
1963-64 1.36 1.29 1.66 1.85 -
1964-65 1.35 1.37 1.56 f.46 -
1965-66 1.43 1.41 1.74 1.69 -
1966-67 1.46 1.41 1.76 1.72 $2.05 $1.79

1967-68 1.69 1.56 2.07 2.02 2.27 2.10
1968-69 1.86 1.57 1.98 1.99 2.18 2.04
1969-70 1.87 1.66 2.12 2.13 2.29 2.16
1970-71 1.95 1.71 2.14 2.19 2.35 2.21
1971-72 1.87 1.72 2.09 2.12 2.31 2.18

----------------------------Tangerines----------------------------
4/5 bu. 4/5 bu.
Bruce Bruce
box box-flat

1962-63 $1.81 $2.13
1963-64 1.78 1.74
1964-65 1.64 1.66
1965-66 1.72 1.84
1966-67 1.87 1.88

1967-68 2.05 2.20
1968-69 2.14 2.33
1969-70 2.34 2.45
1970-71 2.41 2.94
1971-72 2.47 2.66


1,000 copies














OTHER MIMEOGRAPHED PUBLICATIONS AVAILABLE ON CITRUS COSTS


FOOD AND RESOURCE ECONOMICS DEPARTMENT
Institute of Food and Agricultural Sciences
University of Florida
Gainesville, Florida 32601


1. Costs of Picking and Hauling Florida Citrus Fruits, 1971-72 Season.
Economic Report 42. February 1973.

2. Citrus Production Costs and Returns in Florida Season 1970-71 with
Comparisons. Florida Cooperative Extension Service, Economic Report
39. October 1972.

3. Orange Production Costs and Returns in Florida, Season 1968-69 with
Comparisons. Florida Cooperative Extension Service, Economic
Series 70-3. October 1970.

4. Should I Buy a Citrus Grove? Florida Agricultural Extension Service
Circular 332. May 1969.

5. Cost of Planting and Developing Citrus Groves Through 10 Years of
Age. Florida Agricultural Extension Service Economic Series 65-1.
February 1965.

6. Cost of Planting and Developing Citrus Groves in the Indian River
Area of Florida Through Six Years of Age. Florida Cooperative
Extension Service Economic Series 70-1. July 1970.

7. Cost of Planting and Developing Citrus Groves in Southwest Florida
Through Seven Years of Age. Florida Cooperative Extension Service
Economic Series 70-4. October 1970.







"This public document was promulgated at an annual cost of $4870
or $4.87 per copy to inform county agricultural directors, fresh fruit
packers and others in the citrus industry of research results of citrus
ackinghouse costs for 1971-72."