• TABLE OF CONTENTS
HIDE
 Front Cover
 Table of Contents
 Introduction
 Trends in milk production, utilization...
 Characteristics of milk marketing...
 Milk marketing facilities and distributing...
 Milk supply, movement, utilization...
 Potential demand for fluid milk...
 Summary and conclusions
 Production and consumption of milk...
 Size characteristics of fluid milk...
 Sales of fluid milk products by...






Group Title: Agricultural economics mimeo report - University of Florida. Agricultural Experiment Station ; no. 63-1
Title: An Economic evaluation of fluid milk supply, movement and utilization in Florida
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 Material Information
Title: An Economic evaluation of fluid milk supply, movement and utilization in Florida
Series Title: Agricultural economics mimeo report
Physical Description: 119 p. : ; .. cm.
Language: English
Creator: Greene, R.E.L
Warburton, H.W
University of Florida -- Agricultural Experiment Station. -- Dept. of Agricultural Economics
Publisher: University of Florida. Agricultural Experiment Station.
Place of Publication: Gainesville, Fla.
Publication Date: 1962
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Statement of Responsibility: by R.E.L. Greene, and H.W. Warburton.
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Table of Contents
    Front Cover
        Front Cover
    Table of Contents
        Page i
        Page ii
    Introduction
        Page 1
        Page 2
        Page 3
        Page 3a
        Page 4
        Page 5
        Page 6
        Page 7
        Page 8
    Trends in milk production, utilization and consumption
        Page 9
        Page 10
        Page 11
        Page 12
        Page 13
        Page 14
        Page 15
        Page 16
        Page 17
        Page 18
        Page 19
        Page 20
        Page 21
        Page 22
        Page 23
        Page 24
    Characteristics of milk marketing areas in Florida
        Page 25
        Page 26
        Page 27
        Page 28
        Page 29
        Page 30
    Milk marketing facilities and distributing methods
        Page 31
        Page 32
        Page 33
        Page 34
        Page 35
        Page 36
        Page 37
        Page 38
        Page 39
        Page 40
        Page 41
        Page 42
        Page 43
        Page 44
        Page 45
        Page 46
    Milk supply, movement, utilization and production consumption balance in Florida markets
        Page 47
        Page 48
        Page 49
        Page 50
        Page 51
        Page 52
        Page 53
        Page 54
        Page 55
        Page 56
        Page 57
        Page 58
        Page 59
        Page 60
        Page 61
        Page 62
        Page 63
        Page 64
        Page 65
        Page 66
        Page 67
        Page 68
        Page 69
        Page 70
        Page 71
        Page 72
        Page 73
        Page 74
        Page 75
        Page 76
        Page 77
        Page 78
        Page 79
        Page 80
        Page 81
        Page 82
        Page 83
        Page 84
        Page 85
        Page 86
        Page 87
    Potential demand for fluid milk in Florida markets--1970
        Page 88
        Page 89
        Page 90
        Page 91
        Page 92
        Page 93
        Page 94
        Page 95
    Summary and conclusions
        Page 96
        Page 97
        Page 98
        Page 99
    Production and consumption of milk and milk products
        Page 100
        Page 101
        Page 102
        Page 103
    Size characteristics of fluid milk processing and distributing firms
        Page 104
        Page 105
        Page 106
        Page 107
        Page 108
        Page 109
        Page 110
    Sales of fluid milk products by package type and size
        Page 111
        Page 112
        Page 113
        Page 114
        Page 115
        Page 116
        Page 117
        Page 118
        Page 119
Full Text
September 1962
Agr. Econ. Series
No. 63-1


AN ECONOMIC EVALUATION OF FLUID MILK SUPPLY

MOVEMENT AND UTILIZATION IN FLORIDA


by

R. E. L. GREENE and H. W. WARBURTON


Agricultural Economist
and
Former Graduate Assistant


Department of Agricultural Economics
Florida Agricultural Experiment Station
Gainesville, Florida











TABLE OF CONTENTS


Page

INTRODUCTION................................... ..........

Defining the Problem....... ...................... 1
Objectives of Study.. ...... ...................... 2
Method of Study .......... ..... ................... 3
Review of Literature............................... 6

TRENDS IN MILK PRODUCTION, UTILIZATION AND CONSUMPTION.... 9

Production and Utilization of Milk, United
States and Southern Region, 1925-1960........... 9
Per Capita Consumption of Fluid and Manufactured
Milk Products, United States, 1925-1960.......... 16
Per Capita Consumption of Fluid and Manufactured
Milk Products, Southern Region, 1925-1960 with
Regional Comparisons ............................. 19

CHARACTERISTICS OF MILK MARKETING AREAS IN FLORIDA........ 25

Population......................................... 26

MILK MARKETING FACILITIES AND DISTRIBUTING METHODS........ 31

Types of Firms ..................................... 31
Number and Location of Firms..................... 32
Size of Firms................ ................... 33
Efficiency of Firms............................... 36
Market Shares of Firms............................. 39
Milk Distribution Methods......................... 41

MILK SUPPLY, MOVEMENT, UTILIZATION AND PRODUCTION
CONSUMPTION BALANCE IN FLORIDA MARKETS.................. 47

Production, Farm Distribution and Income to
Farmers, 1925-1959. .............. ................. 47
Location, Volume, and Movement of Supplies of Milk
Sold by Producers, April and October 1959........ 48
Fluid Milk Supplies Originating from Out-of-State
Sources, April and October 1959.................. 59
Total Fluid Milk Supply.......................... 61
Prices Paid for Fluid Milk, April and October 1959. 61
Location, Volume and Distribution of Milk Products
Sold to Consumers, April and October 1959........ 65
Fluid Milk Production-Consumption Balance in
Florida Markets, April and October 1959.......... 83








TABLE OF CONTENTS--Continued


Page

POTENTIAL DEMAND FOR FLUID MILK IN FLORIDA MARKETS--1970.. 88

Method Used in Projecting Fluid Milk Products
Consumption in Florida in 1970................... 89
Estimated Florida Population--1970................ 90
Estimated Per Capita Consumption of Fluid Milk
Products................................. ...... .. 91
Estimates of Potential Demand for Fluid Milk
in Florida Markets--1970...................... 94

SUMMARY AND CONCLUSIONS ................................. 96

Conclusions... ..................... ...........*** 98

APPENDICES.... ........ ............................... 100

Appendix A
Production and Consumption of Milk and Milk
Products.....*.. ..... ... ... ....... .... ..... .. 100
Appendix B
Size Characteristics of Fluid Milk Processing
and Distributing Firms...................... 104
Appendix C
Sales of Fluid Milk Products by Package Type
and Size............................... .......... ill









AN ECONOMIC EVALUATION OF FLUID MILK SUPPLY,
MOVEMENT AND UTILIZATION III FLORIDA


INTRODUCTION

A knowledge of market conditions and alternative courses of
action by both buyers and sellers is among the several assumptions
which must be met for a milk market to be considered competitive./
The marketing of dairy products involves a vast array of individuals,
firms and agencies. Each has a need for general market information
plus a specialized knowledge of quality, quantity, demand and price
in the market for the particular commodity handled. Market growth
potential also needs to be ascertained and made known to all members
of the dairy industry. Costs and margins for producing, processing
and distributing fluid milk are examples of types of economic in-
formation necessary in appraising the efficiency of the marketing of
dairy products,

Operators of dairy farms should be informed as to current
and potential milk supplies and present utilization of milk in their
own and alternative market areas. In regulated markets, they should
understand methods used by control agencies in pricing milk.
They should be aware of the effects of seasonal patterns of production
and consumption of milk on price. They should also know something
of their relative competitive position in the production of milk,
especially as this affects the movement of milk between producing
areas,


Defining the Problem

For the past 20 to 25 years, the dairy industry in Florida
has experienced rapid and continuous changes in (1) economic
conditions (2) population characteristics of its markets and (3)
technology of producing, processing and distributing its products.



1/Many markets for processed milk products approximate an
oligopoly with a few large sellers of brand-differentiated products
and many small buyers. The small number and large size of dairy
farms in Florida markets results in conditions similar toan oligopsony
as well.










All of these changes have had and continue to have an important
bearing on the economic well-being of the industry but they have
not been determined with any degree of reliability and accuracy.
The lack of adequate information and market statistics has led to
opinions and decisions based partly on intuitions and guesswork.

All segments of Florida's dairy industry and consumers of
dairy products should benefit from improved efficiency in milk
marketing. Studies to provide data necessary to such an improve-
ment should include a comprehensive account of past and present
market characteristics. This should include a survey of the
current technology of processing and distributing fluid milk, The
balance between present production and consumption of fluid milk in
each major market area in Florida also needs to be known. An
estimate of the potential demand for fluid milk products through
the present decade would also seem desirable as an aid to im-
proving management decisions.


Objectives of StudyZ/

This study was undertaken to supply some of the types of
data enumerated above. The specific objectives were:
1. To define and describe milk marketing areas in Florida.
2. To determine sources of fluid milk supplies and volumes
of supplies moving to market areas for specific months.
3. To determine marketing methods used and facilities
available for the movement of fluid milk to consumers.


2/
This study was a part of a Southern Region Dairy Marketing
Project SM-10 Revised, "Establishing Guides for Efficient Organization
of the Dairy Industry under Changing Conditions in the South." The
objectives of the Regional study are (1) to determine, for present
and future time periods and for selected milksheds or areas of the
South, the demand for Grade A and manufactured milk; to establish
the supply of this milk; to ascertain the present and prospective
movement of milk and dairy products among areas; and to determine
the most efficient location of processing, distributing and
manufacturing facilities and (2) to develop or synthesize a basic
economic model for procuring milk and processing and distributing
the milk and dairy products needed to satisy the demand of the
various market areas of the South, including location of facilities
and changes in technology and merchandising methods, and to compare
the model with existing conditions and with various alternatives.

This study attempts to describe the present situation as it
relates to Florida. The analysis of suggested changes in the dairy
industry in Florida will be a part of the Regional study.






-3-


This included current milk utilization patterns and net balance of
supplies and consumption in the various milk marketing areas.
4. To evaluate the probable effects of factors associated
with fluid milk consumption and to estimate prospective demand for
fluid milk in Florida markets.


Method of Study

Delineation of State Milk Marketing Areas.--The bulkiness
and perishability of fluid milk have in the past resulted in prod-
uction areas (milksheds) being located close to centers of con-
sumption. Market areas were thus local in nature. In recent years,
many changes in the technology of assembling, processing and marketing
of milk have tended to reduce the advantageous position of local
milk producers. These have tended to widen the production area
around a market and also the distribution area for milk plants.

In recent years, considerable shifts have occurred in the
location of dairy farms in Florida. However,milk production and
marketing in the state are still oriented primarily to the needs of
individual markets. Therefore it seemed desirable to relate the data
to individual marketing areas. Since such areas for fluid milk were
already delineated by state and federal milk marketing control
agencies, it was thought best in this study to use the sane de-
lineation of marketing areas as used by the control agencies. The
1959 geographic boundaries of the marketing areas are shown in
Figure 1. Only one marketing area, Uorthwest Florida, was un-
regdlated by any governmental body at the time of the study!3/
The Florida Milk Commission administered three markets--Uortheast
Florida, Central Florida and the Tampa Day areas. In Southeast
Florida, the farm pricing of milk was regulated by a federal
marketing agreement and order.A/



-/In September, 1961, the Tallahassee Milk Marketing Area
was established by the Florida Milk Commission as a result of a
referendum of producers. The counties in the area are: Day,
Calhoun, Dixie, Franklin, Gadsden, Gulf, Holmes, Jackson, Jefferson,
Lafayette, Leon, Liberty, Madison, Taylor, Wakulla and Washington.
In November, 1961, the pensacola Milk Marketing Area was established
by the same procedure. The area includes Escambia, Okaloosa, Santa
Rosa and Walton Counties.

4/The order covers the counties of Palm Beach, Broward,
Dade and Monroe. Farm prices for milk sold by distributors in the
other seven counties in the Southeast market area are not regulated
by any agency.






-3a-


Northeast 1

I ..--4^ ^ 7v



Northwest \ Central





Tampa Bay < -





Southeast

S




Fig. l.--Delineation of milk marketing areas in Florida, 1959.










In most parts of the United States, regulated marketing
areas for milk are provided with names having a supply area
connotation. This is also true in Florida. However, as stated by
W. G. Sullivan, "such an area is, in fact, an area in which milk
is sold to consumers rather than a production area."./ In each
Florida milk marketing area, most of the milk is consumed in no more
than two or three counties of high population concentration and urban-
ization. Each area, however, includes from eleven to twenty
counties.

Milk marketing areas as delineated in 1959 by market
control agencies were used for two important reasons. First,
this procedure facilitated the use and maximized the value of records
and reports of those agencies which are summarized and published
on an individual milk marketing area basis. Second, there are
numerous difficulties in defining marketing areas for milk. As
will be shown, only one area in Florida was fully supplied by
producers within the market. Distributors of fluid milk products
also are extending the size of the area in which they operate, and
in many cases sell to consumers located in two or more marketing
areas. Therefore, it seemed most logical to use marketing areas as
defined by state and federal agencies and to consider the unregulated
area in Northwest Florida as a distinct milk market.


Types of Data Collected

Data were obtained for each milk marketing area pertaining
to supply, movement and utilization of milk. Information on supply
included: (1) location, (2) volume and (3) prices paid by
processors for local and out-of-area sources of milk. Data on
milk movement included information on intermarket and intramarket
sales and transfers of both raw and processed fluid milk. Supply
information was obtained for the three milk marketing areas
regulated by the Florida Milk Commission from records supplied
by the Commission administrator and his staff. In the Southeastern
Florida Milk Market Area, supply data were obtained partly from the
market administrator and partly from the records of the Independent
Dairy Farmers Association./ In northwest Florida, supply data



5/W. G. Sullivan, "What Can Federal Orders Do to Solve the
Pricing Problem?" Proceedings, Part II, Milk Pricing, 25th Annual
Dairy Industry Week (Bozeman, Montana: Montana State College,
Department of Agricultural Economics) flovember 1960 p.91.

/'This association is a bargaining cooperative representing
dairy farmers supplying milk to the Southeastern Florida Milk
Marketing Area. Offices are in Ft. Lauderdale, Florida.










were obtained by personal interviews with the manager or
representatives of each fluid milk processing plant.-

An accounting was made of the utilization and distribution
of milk received. These data included: (1) location and capacity
of processing and distributing facilities, (2) volume handled by
product and by type and size of package, (3) methods of distribution
employed and quantity marketed by each method and (4) the volume of
sales for each county in which products were distributed. When
sales were made to a distributor, the products were shown as sold
in the county in which the distributor was located, Information
was not obtained from distributors as to whether they sold products
in counties other than those in which they were located.

Data on the utilization and distribution of milk were
obtained in the four administered milk marketing areas partly
from records of market control agencies. Additional data were
collected by schedules completed during personal interviews with
representatives of firms processing and distributing fluid milk
products in these areas. In Northwest Florida, data were obtained
entirely from interviews with representatives of each dairy
processing plant.

In each area, data were collected on supplies and utilization
of milk for two months--Aprll and October, 1959. April is a month
with heavier than normal producer deliveries of milk. October is
a month of greater than normal fluid milk sales in most marketss./
The Dairy Division of the Florida State Department of Agriculture
provided a summary of the amount and origin by states of all fluid
milk products shipped into Florida in 1959.


Method of Analysis

The data were analyzed on a marketing area basis largely by
tabular methods. Firms in each area were stratified into three
size groups on the basis of fluid milk sales per day: (1) less than
2,500 gallons, (2) 2,500 to 9,999 gallons and (3) 10,000 gallons and
over. Comparisons were made between size groups within each market
and for firms of each size in the several marketing areas.

The potential demand for fluid milk in Florida markets was
projected based on two estimates of expected population and assuming
a per capital consumption the same as the estimated consumption in
1959.

2/ For multi-unit firms, each processing plant was treated
as an individual firm.
8/This is shown graphically in Chapter V, Figure 21.
Furthermore, these months were used so that the data collected
would be for the same period as in each of the other state projects
contributing to the Southern Region Dairy Marketing Project SM-10
Revised.










There are two limitations on the data in the study. In many
instances, regional or national data were used to show relevant
trends in both production and utilization of fluid milk and milk
products. Discrepancies should exist only to the extent that these
data or the selected months for which they were collected fail to
portray Florida conditions. A second limitation arose due to the
refusal of a relatively few firms to provide all or a part of the
information requested. In the presentation, appropriate notations
are made in tabulations which do not include all firms or total
product volumes in a particular milk marketing area or other classi-
fications.


Review of Literature

The many aspects of dairy marketing have provided a wide and
diverse field for economics research throughout the United States.
Workers in the principal dairy states in the Northeast, Midwest and
Central regions have published the largest number of reports9/
During the past ten years several valuable economic studies of problems
in dairy marketing in the South have been reported.

Very little dairy marketing research was reported in Florida
during the 1950's or at any other time in the past. McPherson and
Luckey,.ia/: using data from the 1939 and 1949 United States censuses
of agriculture, reported trends in the production of milk in Florida
by counties. No attempt was made to identify and relate market and
supply areas. They did anticipate many of the changes which have since
occurred in the technology of milk production and marketing. However,
due to the insufficiency of available data, they could not project
the probable effects of such changes.

The market structure and degree of competition among dairy
processing firms in twenty-six counties in South Florida were
reported by Brownll/ in 1956. Three publications by Greene,



9 For a bibliography of this material see George n. Metts,
Marketing Handbook for Michigan Dairt Products (East Lansing, Michigan:
Michigan State University, Agricultural Experiment Station Special
Bulletin 430, November 1960) pp. 35, 36, 48, 57.

O/W. K. McPherson and R. F. Luckey, Jr., Some Trends and
Characteristics of the Dairy Industry in Florida (Gainesville,
Florida: Florida Agricultural Experiment Stations Bulletin 539,
March 1959).

11/E. E. Brown, "An Appraisal of and Recommendations for
Increasing the Degree of Competition in Florida's Dairy Industry"
(unpublished Ph.D. Dissertation, Department of Agricultural Economics,
University of Florida, June 1956).










et al.,12/, 13/, determinedd costs of producing milk in market
areas regulated by the Florida Milk Commission. Cost data were
obtained from randomly selected wholesale dairy farms producing
milk in the Northeast Florida, Central Florida and Tampa Bay
milk marketing areas.

The studies enumerated contain valuable information
regarding a few of the past and present dairy marketing problems
in Florida. Hone, however, had as its objective the determination
of current production-consumption balances, facilities and methods
used in movement of fluid milk from farms to consumers, or
projections of potential future demand for fluid milk products in
the major milk marketing areas of the State.

Studies with objectives similar to this one have been
published recently in several other Southern states. Purcell and
Corty15/ reported on a study of the position of dairying in the
South. They.6/ also released a publication on the consumption and


12/R. E. L. Greene, John Warrington and D. L. Drooke,
Summary of Costs and Returns for Wholesale Dairy Farms Northeast
Florida, 1958. (Gainesville, Florida: Florida Agricultural
Experiment Stations, Agricultural Economics Mimeo Report 60-5,
October 1959).

13/R. E. L. Greene, John Warrington and D. L. Brooke, Summary
of Costs and Returns for Wholesale Dairy Farms Central Florida, 1958
(ainesville, Florida: Florida Agricultural Experiment Stations,
Agricultural Economics Mimeo Report 60-2, October 1959).

14/R. E. L. Greene, R. H. Walker and D. L. Brooke, Summary
of Costs and Returns for Wholesale Dairy Farms Tampa Bay Milk
Marketing Area, 1959 (Gainesville, Florida: Florida Agricultural
Experiment Stations, Agricultural Economics Mimeo Report 61-5,
November 1960).

15/F. L. Corty, The Position of Dairying in the South
(Experiment, Georgia: Georgia Agricultural Experiment Stations,
SCS Bulletin 46, September 1956).

16/F. L. Corty and J. C. Purcell, Consumption and Demand
Fluid Milk and Fluid Milk Substitutes in the Urban South (Experiment,
Georgia: Georgia Agricultural Experiment Stations, SCS Bulletin
53, October 1957).










demand for fluid milk and fluid milk substitutes in the South.
Purcell.7/, 18/ made an analysis of the demand for fluid milk and
fluid milk substitutes and projected demand for these products in
the South. Workers in Alabama,19/ South Carolina 20/ and Uorth
Carolina 21/ published recent reports concerning the supplies of
fluid milk and adjustments of dairy farmers to changing market
conditions.

Data in later sections of this report show that market
conditions in Florida are different from those in other Southern
states. This tends to limit the application to this state of
much of the published material dealing with conditions in various
other Southern states or with the region as a whole.



l2/J. C. Purcell, Analysis of Demand for Fluid Milk and Fluid
Milk Substitutes in the Urban South (Experiment, Georgia: Georgia
Agricultural Experiment Stations Technical Bulletin U. S. 12,
October 1957).

18/J. C. Purcell, Prospective Demand for Milk and Milk Products
in the South (Experiment, Georgia: Georgia Agricultural Experiment
Stations, SCS Bulletin 68, October 1959).

19/V. L. Harness and J. H. Blackstone, Alabama's Grade A Milk
Supply (Auburn, Alabama: Alabama Agricultural Experiment Station,
December 1959).

20/C. E. Woodall and H. L. Steele, Grade A Milk Production
in South Carolina (Clemson, South Carolina: South Carolina
Agricultural Experiment Station Bulletin 456, April 1958).

/J. E. Faris and W. K'. McPherson, Adjustments in Milk
Supply, Grade A Dairy Farms, Uorth Carolina Piedmont (Raleigh,
North Carolina: North Carolina Agricultural Experiment Station,
Technical Bulletin 136, January 1959).









TRENDS IN MILK PRODUCTION, UTILIZATION
AND CONSUMPTION


Production and Utilization of Milk, United States
and Southern Region, 1925-1960


Farm Production.--Total United States farm output of milk
increased by more than one-third from 1925 to 1960. The level of
production reached a peak of 124,860 million pounds in 1956, but
some reduction has occurred since that time. The 1960 production
was slightly less than 123,000 million pounds (Table 1). An index
of farm production with 1925 equal to 100, showed output in 1960
to be equal to 136.


TABLE 1. Farm Production of Milk, United States and Southern Region,
1925-1960

: Farm Production : Index of Production
United : Southern : South as Percent : United : Southern
Year : States Region : of United States : States : Region
: Million Pounds : Percent : 1925=100

1925 90,699 10,088 11.1 100 100
1930 100,158 _12,103 12.1 110 120
1935 101,205 12,972 12.8 112 128
1940 109,412 13,538 12.4 121 134
1945 119,828 14,986 12.5 132 148
1950 116,602 14,395 12.3 129 142
1955 122,945 14,356 11.7 136 142
1960 122,920 13,480 11.0 136 133


Source: U. S. Department of Agriculture, Agricultural Marketing i
Service, Dairy Statistics, Statistical Bulletin No. 218 and Supplements
(Washington, D. C., October 1957 and June 1960). Also, U. S. Department
of Agriculture, Economics Research Service, The Dairy Situation (Washing-
ton, D. C., April 1961).

In the Southern Region,22/ milk production on farms rose con-
tinually from 1925 to 1945. The index of production was 148 in 1945,
which was the peak attained between 1925 and 1960. There was a small
decline in production from 1945 to 1955, which continued at a higher
rate from 1955 to 1960. The proportion of total United States output


2/Includes: Alabama, Arkansas, Florida, Georgia, Louisiana,
Mississippi, North Carolina, South Carolina, Tennessee and Texas.







-10-


produced in the Southern Region was 11.0 percent in 1960 compared to
12.i percent in 1945 and 12.8 percent in 1935.

Production varied much more among individual states in the
South from 1925 to 1960 than for the Region or the United States
(Table 2). Only in Arkansas and Alabama did farmers produce less
milk in 1960 than in 1925. The 1960 index of production (1925=100)
for these states was 86 and 99 respectively. By far, the largest
increase occurred in Florida, with the index of milk output at 619
for 1960. Production indices for other states ranged from 108 for
Georgia to 190 for Louisiana in L960.


TABLE 2.--Farm Production of Milk, Southern Region by States, 1925-1960

State : 1925 : 1930 : 1935 : 1940 : 1945 : 1950 : 1955 : 1960

Farm Production
Texas 2,679 3,655 3,741 4,.92 4,068 3,451 2,988 2,927
Tennessee 1,378 1,592 1,754 1,820 2,220 2,329 2,372 2,202
North Carolina 1,054 1,082 1,245 1,309 1,495 1,561 1,661 1,554
Arkansas 1,043 1,092 1,224 1,335 1,478 1,292 1,257 901
Alabama 970 1,134 1,232 1,143 1,357 1,292 1,204 961

Mississippi 925 1,212 1,299 1,176 1,455 1,423 1,447 1,255
Georgia 924 1,066 1,071 1,053 1,152 1,174 1,149 996
South Carolina 462 496 538 539 600 556 591 536
Louisiana 442 533 576 628 693 719 803 842
Florida 211 241 290 343 468 598 884 1,306

Index of Production (1925=100)
Texas 100 136 140 156 152 129 112 109
Tennessee 100 116 127 132 161 169 172 160
North Carolina 100 103 118 124 142 148 158 147
Arkansas 100 105 117 128 142 124 120 86
Alabama 100 117 127 118 140 133 124 99

Mississippi 100 131 140 127 157 154 156 136
Georgia 100 115 116 114 125 127 124 108
South Carolina 100 101 109 110 122 113 120 109
Louisiana 100 121 131 142 157 163 182 190
Florida 100 114 137 163 222 283 419 619


Source: U.S, Department of Agriculture, Agricultural Marketing
Service, Dairy Statistics, Statistical Bulletin No. 218 and Supplements
(Washington, D. C., October 1957 and June 1960). Also, US. Department
of Agriculture, Economics Research Service, The Dairy Situation (Washing-
ton, D. C., April 1961).






-11-


The most noticeable change within the Southern Region was the.
changing order of importance of each state relative to the total
regional output of milk (Table 3). States which ranked first, second
and third in total production in 1925 were Texas, Tennessee and North
Carolina. These states still held the same rank in 1960 but only
in Tennessee and North Carolina did production increase enough to
account for a higher percentage of the total regional output. The
greatest movement in order of rank was for Florida which was tenth
in 1925, but rose to fourth in 1960. Florida's output of milk in
1960 was 9.7 percent of the regional total compared to only 2.1 percent
in 1925.


TABLE 3.--Farm
Rank According


Production of Milk, Percent of Regional Production and
to Production by State, Southern Region, 1925 and 1960


Farm Production:
State and Million Pounds:Percent of Total: Rank:
Division: 1925: 1960: 1925: 1960: 1925: 1960:

Texas 2,679 2,927 26.5 21.8 1 1
Tennessee 1,378 2,202 13.6 16.3 2 2
North Carolina 1,054 1,554 10.4 11.5 3 3
Arkansas 1,043 901 10.3 6.7 4 8
Alabama 970 961 9.6 7.1 5 7

Mississippi 925 1,255 9.1 9.3 6 5
Georgia 924 996 9.1 7.4 7 6
South Carolina 492 536 4.9 4.0 8 10
Louisiana 442 842 4.4 6.2 9 9
Florida 211 1,306 2.1 9.7 10 4

Total 10,118 13,480 100.0 100.0 .

United States 90,699 122,920 ....

South as a percent
of United States 11.1 11.0 ... ... ..


Source: Calculated from data in Table 2, p.10.


Milk Marketed and Used on Farms.--From 1925 to 1960, dairy
farmers in the United States and the Southern Region increased the
volume and percent of milk output marketed. During this period,
milk production increased 36 percent nationally and 33 percent in
the Southern Region. The proportion of the United States output






-12-


marketed rose from
Region, farm sales
cent. Two factors
marketing of milk
ing and the growth


70 to 92.5 percent (Table 4). In the Southern
increased from 25.7 percent of output to 82.4 per-
which have given rise to the increase in farm
in the South are the decline in subsistence farm-
of large urban markets.


TABLE 4.--Milk Marketed and Used on Farms, United States and Southern
Region, 1925-1960

United States Southern Region
: : Milk : Total : : Milk : Total
Year : Milk : Used on : Pro- : Milk : Used on : Pro-
: Sold : Farms duction : Sold Farms : duction

Amount of Milk
1925 63,517 22,182 90,699 2,589 7,499 10,088
1930 75,318 24,840 100,158 4,345 7,758 12,103
1935 75,188 26,017 101,205 4,475 8,497 12,972
1940 86,226 23,186 109,412 5,839 7,699 13,538
1945 98,373 21,455 119,828 7,525 7,461 14,986
1950 98,348 18,254 116,602 8,258 6,137 14,395
1955 108,320 14,625 122,945 9,842 4,514 14,356
1960 113,721 9,199 122,920 11,104 2,376 13,480

--Percent of Total Production
1925 70.0 30.0 100.0 25.7 74.3 100.0
1930 75.2 24.8 100.0 35.9 64.1 100.0
1935 74.3 25.7 100.0 34.5 65.5 100.0
1940 78.8 21.2 100.0 43.1 56.9 100.0

1945 82.1 17.9 100.0 50.2 34.2 100.0
1950 84.3 15.7 100.0 57.4 42.6 100.0
1955 88.1 11.9 100.0 68.6 31.4 100.0
1960 92.5 7.5 100.0 82.4 17.6 100.0


Source:
Service, Dairy
Washington, D.


U. S. Department of Agriculture, Economic Research
Statistics Through 1960, Statistical Bulletin No. 303,
C.; February 1962.


Methods used to market milk and the form in which it is marketed
by farmers have changed significantly. In 1925, United States dairy
farmers sold 90.1 percent of the volume marketed to plants and dealers
(Table 5). Of this amount, 42.2 percent was whole milk and
47.9 percent farm-separated cream. The balance of farm marketing,





-13-


9.9 percent, was sold at Ottail to consumers. Sales to dealers and
plants increased to 98.3 percent of total United States production in
1960. However, only 7.2 percent of output was sold as farm-separated
cream. Whole milk sales to dealers increased to 91.1 percent of market-
ings. Retail sales to consumers declined to 1.7 percent of all milk
marketed in 1960.


TABLE 5.--Percentage Disposition of Milk Marketed, United States
and Southern Region, 1925-1960



: Percent of Total Milk Marketed Soldj:
Year : To Plants and Dealers as: Retailed : Total
: Whole : as Milk
: Milk : Cream : and Cream :

United States

1925 42.2 47.9 9.9 100.0
1930 45.8 45.1 9.1 100.0
1935 47.4 43.3 9.3 100.0
1940 54.7 38.2 7.1 100.0
1945 70.0 24.3 5.7 100.0
1950 75.5 20.5 4.0 100.0
1955 83.9 13.6 2.5 100.0
1960 91.1 7.2 1.7 100.0

Southern Region

1925 35.1 38.0 26.9 100.0
1930 40.1 39.0 20.9 100.0
1935 41.8 36.7 21.5 100.0
1940 49.2 33.3 17.5 100.0
1945 68.2 17.8 14.0 100.0
1950 80.0 9.0 11.0 100.0
1955 91.2 2.8 6.0 100.0
1960 96.5 0.7 2.8 100.0


Source: U. S. Department of Agriculture, Agricultural Marketing
Service, Dairy Statistics, Statistical Bulletin No. 218 and Supplements
(Washington, D. C.: October 1957 and June'1960). Also, U. S. Department
of Agriculture, Economics Research Service, The Dairy Situation (Washing-
ton, D. C.: April 1961).


In the Southern Region similar changes occurred. The greatest
portion of milk marketed in 1925 was in the form of farm-separated





-14-


cream. In that year sales to dealers accounted for 73.1 percent of
marketing. Of this amount, less than one-half was in the form of
whole milk. By 1960, only 0.7 percent of all farm sales of milk
was farm-separated cream. Whole milk sold to plants accounted for
96.5 percent of the volume marketed. Retail sales to consumers
also declined in the thirty-five year period, from 26.9 percent
of farm marketing in 1925 to 2.8 percent in 1960.

The disposition of milk used on farms has also changed. For
the United States as a whole, less milk is now consumed by farm
families and more is fed to calves (Table 6). In 1925, 89.8 per-
cent of milk used on farms was for human consumption and 10.2 per-
cent fed to calves. In 1960, 72.5 percent was consumed by farm
residents and 27.5 percent was fed to calves. The human consumption
of milk on farms was proportionally higher in the Southern Region
from 1925 to 1960 than in the entire United States. In 1960,
93.1 percent of farm use of milk was for human consumption and 6.9
percent was fed to calves.


TABLE 6.--Disposition of Milk Used on Farms, United States and Southern
,Region, 1925-1960


: United States: --Southern Region:
Year: : : Total: : : Total
: Human : Fed to: Farm : Human : Fed to : Farm
: Consumption: Calves: Use : Consumption: Calves : Use

Percent___
1925 89.8 10.2 100.0 98.2 1.8 100.0
1930 88.0 12.0 100.0 98.0 2.0 100.0
1935 89.7 10.3 100.0 98.2 1.8 100.0
1940 87.1 12.9 100.0 97.9 2.1 100.0

1945 84.6 15.4 100.0 97.1 2.9 100.0
1950 82.0 18.0 100.0 96.3 3.7 100.0
1955 77.7 22.3 100.0 95.2 4.8 100.0
1960 72.5 27.5 100.0 93.1 6,9 100.0


Source: U. S. Department of Agriculture, Agricultural Marketing
Service, Dairy Statistics, Statistical Bulletin No. 218 and Supplements
(Washington, D. C.: October 1957 and June 1960). Also, U. S. Department
of Agriculture, Economics Research Service, The Dairy Situation (Washing-
ton, D. C.: April 1961).


Among the states in the Southern Region, there was a considerable
range in the percent of output marketed and used on farms. The portion





-15-


of total production which was marketed was above the regional average
for Florida, Texas and Tennessee. The proportion of output marketed
was above the United States average only in Florida. The percent of
production marketed in 1960 ranged to a low of 68.6 percent in Alabama.

Number of Cows and Production per Cow.--Similar trends in
numbers of cows and production per cow have occurred in the United
States and the Southern Region. The United States dairy cow
population increased from 21,503,000 in 1925 to 25,033,00 in 1945
but has declined since (Table 7). The cow population in the ten
states of the Southern Region in 1960 was 2,908,000. This was a
considerable decline from the 4,708,000 reported in 1945. It was
also substantially below the 1925 total of 3,493,000 dairy cows. The
number of cows in Florida has shown a continuous increase from 1925 to
1960. The 195,000 cows on farms in Florida in 1960 were more than two
and one-half times as large as the number in 1925.

Despite the large reduction in numbers of dairy cows from 1925
to 1960, the increase in production per cow was more than ample to con-
tinue increases in total milk production, both in the United States and
the Southern Region. From 1925 to 1960, annual production per cow in
the United States rose from 4,218 to 7,004 pounds. Annual production
per cow in the Southern Region increased from 2,880 to 4,680 pounds.
The increase was far greater in Florida. Annual output per cow in-
creased from 2,850 pounds in 1925 to 6,700 pounds in 1960.


TABLE 7.--Number of Cows on Farms and Production per Cow, United States,
and Southern Region, 1925-1960

Number of Cows : Production per Cow: Index of Production:
SYear. per Cow
: United: Scuthern: United: Southern: United : Southern.
:States: Rrgion : States: Region : States: Region :
Thousands Founds 1925=100
1925 21,503 3,493 4,218 2,880 100 100
1930 22,218 3,782 4,508 3,160 107 110
1935 24,187 4,466 4,184 2,900 99 101
1940 23,671 4,328 4,622 3,150 110 109

1945 25,033 4,708 4,787 3,270 113 114
1950 21,944 4,158 5,314 3,550 126 123
1955 21,044 3,887 5,842 3,793 138 132
1960 17,549 2,908 7,004 4,680 166 162

Source: U. S. Department of Agriculture, Agricultural Marketing
Service, Dairy Statistics, Statistical Bulletin No. 218 (Washington,
D. C.: October 1957). Also, U. S. Department of Agriculture, Statis-
tical Reporting Service, Crop Reporting Board, Milk Production,
Disposition and Income 1959-60 (Washington, D. C.: April 1961).





-16-


On an index of production per cow, with 1925=100, output in
1960 was 166 for the United States and 162 in the Southern Region.
The increase in productivity in Florida far exceeded these levels,
at 235 in 1960.

Utilization of Milk Produced.--Since 1925, important changes in
consumer usage of dairy products have resulted in significant changes
in the disposition of milk supplies in the United States (Fig.2).
Fluid milk, cheese and frozen dairy products showed fairly consistent
gains in the percent of total United States milk supplies utilized
in these products. Cheese has risen constantly, from 5.3 percent
of total supplies in 1925 to 10.1 percent in 1959. Fluid milk and
frozen dairy products both showed gains in importance for the
entire period, but declined relative to other dairy products during
the early 1930's. Butter, evaporated milk and condensed milk showed
considerable declines from years of peak utilization of milk supplies
in these products. Other minor uses of milk have also shown con-
siderable declines from peak years in the period to 1959.23/ These
other uses include dry whole milk, farm butter, exports and storage
stocks, milk fed to calves and other minor uses of milk.


Per Capita Consumption of Fluid and Manufactured
Milk Products, United States, 1925-1960

Fluid Milk Products.--The United States per capital consumption
of all fluid dairy products remained fairly stable from 1925 to 1940.
Consumption rose to a record level in 1945. Since 1950, consumption
has again been stable at levels above 1925-1940, but below the 1945
rate by a considerable amount. In 1958, the latest year for which
complete data are available, the quantity of all dairy products
consumed was 368.0 pounds per capital (Table 8).24/

Among various products, trends in per capital consumption have
moved in opposite directions. Increases in consumption per person
of cultured buttermilk, chocolate-flavored skim milk and cottage
cheese have been little short of phenomenal. Cultured buttermilk
increased from 1.8 pounds per capital in 1925 to 8,1 pounds in
1958, an increase of 6.3 pounds or 350 percent. In this same
period, chocolate-flavored skim milk and cottage cheese showed
increases of 1,057 percent and 500 percent respectively. The rate
of increase of fresh whole milk was small compared to those products
which increased. Per capital consumption of whole milk also decreased
over a part of the period, declining from 335 pounds in 1945 to 287
pounds in 1960.



23/Reported in Appendix A, Table 44, which provides complete
data from 1925-1955 at five-year intervals and annually from
1956-1959.
24/Exclusive of donations and other special programs operated
by the federal government.






-17-


Percent


7r

7




V'


Fluid milk


Butter


40






30






20






10


Cheese

Frozen dairy
products
Evaporated and
condensed milk


1925 1930 1935 1940 1945 1950 1955 1959


Fig. 2.--Percent of United States milk production used for
various dairy products, 1925-1959.

Source: U. S. Department of Agriculture, Agricultural Marketing
Service, Dairy Statistics, Statistical Bulletin No. 218 (Washington,
D. C. : October 1957). Also, U. S. Department of Agriculture, Statis-
tical Reporting Service, Crop Reporting Board, Milk Production,
Disposition and Income 1959-60 (Washington, D. C.: April 1961).


Inr.~ .` .."
.. .,. -C.


Ir


1


,.... --
.,....,






-18-


TABLE 8.--Per Capita Consumption of Fluid Dairy Products, United States,
1925-1960a


Fluid Milk Chocolate: : : Total
and Creamb Fresh: Cultured: Drinks : Natural:Cottage : Fluid
Year : ::Skim : Butter-: Made from: Butter-:Cheesee : Dairy
: Fresh: :Milk : milkd : Skim Milk: milk : Products
: Whole: Cream : : :
: Milk :: ::::

Pounds

1925 270 10.8 18.2 1.8 .7 49.6 .9 352.0
1930 270 10.8 16.9 2.6 1.1 45.5 1.2 348.1
1935 261 10.4 17.2 2.9 2.9 45.6 1.3 341.3
1940 265 10.6 15.9 4.2 3.8 40.5 1.9 341.9
1945 335 12.8 13.9 7.0 6.1 34.2 3.0 412.0
1950 293 12.6 11.9 8.3 7.4 28.7 3.5 365.4
1955 303 11.1 11.6 8.6 7.9 26.8 4.6 373.6

1956 306 10.8 11.6 8.6 8.0 26.7 5.3 377.0
1957 303 10.1 11.7 8.7 8.1 26.6 5.4 373.6
1958 298 9.6 11.7 8.7 8.1 26.5 5.4 368.0
1959 292 9.3 .... ... ... .... 5.6 .....
1960g 287 9.3 ....f ...f ...f ....f 5.6 .....


Source: U. S. Department of Agriculture, Economics Research
Service, The Dairy Situation (Washington, D. C., April 1961).

.aCivilian consumption only, 1945 to date.

hCream estimated as 20 percent of total "fluid milk and cream"
consumption, 1925-1940. From 1945, the proportion has been varied
largely on the basis of information obtained from markets having
federal milk marketing orders.

POn basis of 25 percent fat content.

.Produced from skim milk.

eIncludes minor quantities of other skim milk cheese.

fData not available.


gPreliminary.






-19-


In contrast to increases for the above products, fresh fluid
creams, fresh skim milk and natural buttermilk showed considerable
declines in per capital consumption. Fluid cream usage dropped from
10.8 pounds per person in 1925 to 9.3 pounds in 1960, or 13.9 percent.
Fresh skim milk declined from 18.2 pounds in 1925 to 11.7 pounds in
1958. natural buttermilk declined from 49.6 to 26.5 pounds in the
same period.

Manufactured Dairv Products.--United States aggregate per
capital consumption of all types of manufactured dairy products
increased continuously from 1925 to 1950 but consumption was
fairly stable at about 91 to 94 pounds per person from 1955 to
1960 (Table 9). As was true. for the consumption of fresh fluid
products, considerable changes have occurred in patterns of
consumer use of various manufactured dairy products. Products with
rising national per capital consumption rates are frozen dairy
products--notably ice cream and ice milk--cheese, and nonfat dry milk.
The 1960 consumption of frozen dairy products in terms of net milk
used was 51.8 pounds per capl.ta--an increase of more than 120 percent
over the 1925 rate. Consumption of American and other cheeses was
8.4 pounds per capital in 1960--an increase from 1925 of more than
78 percent. The consumption of nonfat dry milk rose from 0.4 pounds
per capital in 1925 to 6.2 pounds in 1960, or an increase of
1,450 percent.

Since the mid-1940's, all forms of evaporated and condensed
milks and butter have experienced continuous and sharply declining
per capital rates of consumption. In 1945 evaporated and condensed
milks reached a combined peak per capital consumption of 26.0 pounds.
Dy 1960 the rate had fallen to 18.0 pounds, or a 31 percent decline.
Butter, which was consumed at a rate of 18.1 pounds per capital in
1925 dropped to a low of 7.6 pounds in 1960.

Throughout the period 1925-60, all forms of dry milk powder,
other than dry akim milk powder, accounted for only minor and
relatively insignificant amounts of the total per capital consumption
of manufactured dairy products. Since 1945, consumption of dry
milk products, which includes dry whole milk, dry whey, dry butter-
milk and malted milk, has been fairly stable, ranging from slightly
less to slightly more than 1.0 pound per capital.


Per Capita Consumption of Fluid and Manufactured
Milk Products, Southern Region, 1925-1960
with Regional Comparisons

Fluid Milk Products.--There have been relatively few studies
which attempted to estimate per capital consumption of fluid and
manufactured milk products. This is true not only for states






-20-


TABLE 9.--Per Capita Consumption of Manufactured Dairy Products,
United States, 1925-1960a


Year : Evaporated and: : : :
: Condensed : : : Frozen : DryMilk : Total
: Wholeb: Skim : : Dairy : : : Manufactured
: Milk : Milk : Butter: Cheese : Productsd: Nonfat: Other: Dairy Products

1925 11.7 1.9 18.1 4.7 23.5 0.4 0.2 60.5
1930 13.6 2.7 17.6 4.7 24.7 1.3 0.3 64.9
1935 16.2 2.5 17.6 5.3 20.2 1.6 0.2 63.6
1940 19.3 3.2 17.0 6.0 28.9 2.2 0.4 77.0
1945 18.3 7.7 10.9 6.7 37.5 1.9 1.1 84.1
1950 20.1 5.1 10.7 7.7 45.0 3.7 0.9 93.2
1955 16.2 4.7 9.0 7.9 48.7 5.5 0.8 92.8

1956 15.9 4.5 8.7 8.0 49.8 5.2 1.0 93.1
1957 15.4 4.6 3.3 7.7 49.3 5.3 0.9 91.5
1958 14.8 4.2 d.3 8.2 49.6 5.6 1.2 91.9
1959 14.4 4.5 7.9 8.1 52.1 6.1 1.1 94.2
1960 13.8 4.2 7.6 8.4 51.8 6.2 1.1 93.1


Source: U. S. Department of Agriculture, Agricultural Marketing Service,
Dairy Statistics, Statistical Bulletin 1o. 218 and Supplements (Washington, D. C.:
October 1957 and June 1960) Table 305. Also, U. S. Department of Agriculture,
Economics Research Service, The Dairy Situation (Washington, D. C.: April 1961).
a
Civilian Consumption only, 1945 to date.

Includes canned evaporated and both sweetened and unsweetened condensed
whole milk.

CIncludes American cheese and other whole and part-milk cheese.

dIncludes ice cream, ice milk, sherbet and other frozen dairy desserts.
Figures shown are for net milk used in all frozen dairy products.
eIncludes dry whole milk, dry whey, malted milk and dry buttermilk powder.

fPreliminary.





-21-


individually, but even more so for regional areas. Because of the
lack of periodic and comprehensive data, it is practically impossible
to derive trends over time in per capital consumption by product for
individual states or regions.

It is possible, however, to obtain a fairly reliable estimate
of per capital consumption rates for individual dairy products by regions
for 1955 from,a series of studies by the United States Department of
Agriculture.25/,26,/27'/28'/29 In these studies, quantities of dairy
and other foods used in a seven-day period were obtained from a sample
of households in each region. From these data, it was possible to 30/
calculate the annual per capital consumption of major dairy products.-

On a per capital basis, the South consumed considerably lower
amounts of most fluid milk products than any other region in the United
States (Table 10). Fluid whole milk accounted for the major proportion
of fresh fluid milk products consumed in all regions. Consumption of
fluid whole milk in the South was less than one-half that of the North
Central region, the highest consuming area, and was only about three-
fourths of the national average. Per capital consumption of fluid skim
milk, fluid creams and cottage cheese in the South approximated one-
third of the average for the United States. It was one-fifth or
less of the consumption in the region with the highest rate of



25/Food Consumption of Households in the United States, Report
T1o.1 (Washington, D. C.: U. S. Department of Agriculture, Agricultural
Research Service and Agricultural Marketing Service, December 1956).
26/Food Consumption of Households in the Northeast, Report No. 2
(Washington, D. C.: U. S. Department of Agriculture, Agricultural
Research Service and Agricultural Marketing Service, December 1956).

27/Food Consumption of Households in the North Central, Report
No. 3 (Washington, D. C.: U. S. Department of Agriculture, Agricultural
Research Service and Agricultural Marketing Service, December 1956).

28/Food Consumption of Households in the South, Report No. 4
(Washington, D. C.: U. S. Department of Agriculture, Agricultural
Research Service and Agricultural Marketing Service, December 1956).

29/Food Consumption of Households in the West, Report No. 5
(Washington, D. C.: U. S. Department of Agriculture, Agricultural
Research Service and Agricultural Marketing Service, December 1956).

30/Annual per capital consumption equals consumption per household
per week divided by household size multiplied by 52. Complete data are
given in Appendix A, Table 46.






-22-


consumption. Southerners consumed chocolate drinks at a rate per
capital equaling the national average. However, with the exception
of the north Central region, there was little variation between -egions
in per c.pita-consumption rates of this product. Buttermilk con-
sumption per capital in the South was higher than the United States
average by two and one-half times and over ten times as much as the
region with the lowest per capital consumption.


TABLE 10.--Annual Per Capita Consumption of Fluid Milk Products,
by Regions, 1955a


Region :Fluid Whole : Dutter-: Skim :Chocolate:Fluid:Cottage
: Milk milk Milk :Drinks :Cream:Cheese
Pounds
South 256.9 47.3 3.6 3.6 2.1 2.6
Northeast 364.0 4.7 10.4 4.2 5.2 5.7
North Central 551.7 6.2 23.4 1.0 22.4 9.4
West 354.1 9.4 19.2 3.6 12.0 12.0

United States 335.9 19.8 9.9 3.6 6.8 6.8

South as percent
of United States 76.5 2389 36.4 100.0 30.9 38.2


Source: Calculated from Appendix A, Table 45.

aIncludes products normally processed and distributed by fluid
milk plants.


Purcell estimated 1955 per capital consumption of fluid milk
products in the Sout by states and place of residence--ur-an, rural
non-farm and farm 3- (Table 11). His data indicated that no state
in the South had a per capital consumption rate much greater than
the regional average. These estimates agreed with the findings of
the United States Department of Agriculture--that the Southern
Region consumes far less than national average amounts of fluid
milk products. By showing rates of consumption by urbanization


31/J. C. Purcell, Op. cit.,p. 24, Table 6.








TABLE 11.--Estimated


Annual Per Capita Consumption of Fluid Milk Products in Fluid Jhole Milk Equivalent,
by States and Urbanization, 1955


Buttermilk, Skim
Fluid Whole Milka Milk and Creamb Ice Creamc Cottage Cheesed
State or Rural Rural Rural Rural
ea Urban lion- Farm Urban Hon- Farm Urban ion- Farm Urban Non- Farm
Farm Farm Farm Farm

Pounds
Alabama 215.2 223.6 327.4 38.9 49.2 97.6 52.7 29.3 30.9 23.7 14.0 10.9
Arkansas 229.7 238.3 345.6 39.6 50.1 98.8 55.3 30.7 33.3 26.3 15.4 11.6
Florida 231.8 233.1 355.4 39.7 49.8 98.9 55.7 30.2 33.5 26.6 14.9 11.7
Georgia 217.6 225.5 323.7 39.0 49.3 97.4 53.1 29.5 30.5 24.1 14.2 10.8
Louisiana 219.0 217.6 302.1 39.1 48.8 96.4 53.4 28.7 28.5 24.4 13.4 10.2
Mississippi 207.3 213.5 262.3 38.6 48.6 94.5 51.2 28.3 24.7 22.4 13.0 9.0
Horth Carolina 225.0 233.4 330.4 39.4 49.8 97.7 54.4 30.2 31.1 25.4 14.9 11.0
South Carolina 219.3 213.9 266.3 39.1 48.6 94.7 53.4 28.3 25.1 24.5 13.1 9.1
Tennessee 229.4 252.4 391.8 39.6 51.0 100.6 55.2 32.1 37.0 26.2 16.8 12.7
Texas 245.5 247.5 384.4 40.3 50.7 100.2 58.1 31.6 36.3 29.0 16.3 12.5

South 229.4 232.6 331.7 39.6 49.8 97.8 55.2 30.2 31.3 26.2 14.9 11.0
United States 334.3 313.0 412.5 31.2 31.8 65.9 56.1 50.7 53.9 57.3 45.9 38.2

South as a percent
of United States 68.6 74.3 80.4 127.0 156.6 148,4 98.4 59.5 58.0 45.7 32.4 28.8


Source: J. C. Purcell, Prospective Demand
SCS Bulletin 68, October 1959) Table 6,p. 24.

aWhole milk basis.
b
bIonfat-solids basis. No adjustments were
flavored skim milk.


for Milk and Milk Products in the


South (Experiment, Georgia:


made by states for cream. Includes chocolate and other


CFat-solids basis.

d Honfat-solids basis.


- --- --






-24-


it is also possible to account for part of the differences in per
capital consumption between various states in the South. Residents of
urban areas consume as much as one-third less fluid milk products per
person than the farm population. Rural non-farm residents also consume
slightly more fluid milk products than urban inhabitants of each state.
Consequently, those Southern states with the highest portion of total
population living on farms and in non-farm rural residences generally
have higher per capital rates of consumption when all urbanizations are
combined into weighted average rates. As these states experience declin-
ing farm and rural non-farm population, the total population may be
expected to consume less fluid milk per capital.

Manufactured Milk Products.--The consumption of manufactured
milk products on a per capital basis showed considerable variation among
regions (Table 12). With the exception of evaporated, condensed and
dry milks, the South consumed less per capital of products in this
group than any other region or the average for the nation. The Southern
Region population consumed butter at 50 percent, cheese at 84 percent
and frozen dairy products at 77 percent of the United States average
rates. Consumption per capital of evaporated and condensed milks was
152 percent and of dry milk 131 percent of the United States average.


TABLE 12.--Annual Per Capita Consumption of Manufactured Milk Products,
by Regions, 1955

SFrozen Evaporated
Region Dairy and Dry Milk : Cheese Butter
Products Condensed Milks.
Pounds
South 58.2 24.4 2.1 8.3 9.9
Northeast 69.7 12.0 1.0 12.0 24.4
Ilorth Central 123.8 6.8 1.0 10.9 25.4
West 83.2 19.8 1.6 10.4 18.7

United States 75.4 16.1 1.6 9.9 19.8

South as percent
of United States 77.2 151.6 131.2 83.8 50.0

Source: Calculated from Appendix A, Table 46.


The relatively low per capital consumption for most dairy products
--both fresh fluid milk and manufactured milk products--has many
important implications to all segments of the dairy industry in the
region.













CHARACTERISTICS OF MILK MARKETING
AREAS II FLORIDA



As indicated on page 3, the State was divided into five milk
marketing areas corresponding with state and federal milk control
areas in 1959. This section presents a description of the geographic
size of each marketing area and population and income characteristics
of each area.

Land Area and Number of Counties.--lumber of counties in the
five milk marketing areas varied from 11 to 20 (Table 13). The
number of counties within various market boundaries does not indicate
their relative size or land area comprised. Tampa Bay, with 7,640
square miles, is smallest in land area. Areas are progressively
larger in Northeast, Central, Southeast and Northwest Florida.
Northwest Florida is almost twice as large as Tampa Bay area. As
will be shown, amount of land in a market area is of consequence
principally as it affects population density which is important
because of its influence on milk distribution costs. Many factors
related to per capital consumption levels for dairy foocs are also
affected by the size and concentration of market population.


TABLE 13.--Florida Milk Marketing Areas: Counties included, Land Area
and Population Density, 1959

: :Land Area
Milk Marketing : lumber of : Population
Area : Counties : Square : Percent of : Density
.Miles Total

Northwest 20 14,312 26.4 41.8
Northeast 14 8,866 16.3 80.1
Central 11 10,797 19.9 83.7
Tampa Bay 11 7,640 14.1 141.2
Southeast 11 12,647 23.3 131.2
Florida 67 54,262 100.0 91.3


persons per square mile.


-25-






-26-


Population

The number of people in various milk marketing areas on April 1,
1960 varied from 598,000 in Northwest Florida to 1,660,000 in South-
east Florida. The population of each area was progressively larger
the farther south the marketing area was located in the state. The
proportion of the total population in the state in each area varied
from 12.1 percent for Northwest to 33.5 for Southeast Florida.

Trend in total population, 1930-1960.--Florida is unique in rate
of change in total population in at least one respect. For two
consecutive decades, 1940 to 1950 and 1950 to 1960, the rate of increase
in each period was higher than the rate for the 10 previous years.
This has not occurred recently in any other heavily populated state
in the United States.2/. Recent high rates of growth in population
have not been distributed uniformly among milk marketing areas.
From 1950 to 1960, rates of growth in Central Florida, Tampa Bay
and Southeast Florida exceeded the over-all growth rate.


TABLE 14.--Total Population, by Milk Marketing Areas, Florida,
April 1, 1960

: Total Population
Milk Marketing Area : Iumber Percent of
: Total
Northwest 598,336 12.1
Northeast 710,282 14.4
Central 904,111 18.3
Tampa Day 1,079,030 21.7
Southeast 1,659,801 33.5
Florida 4,951,560 100.0

Source: U. S. Bureau of the Cenus, U. S. Census of Population:
1960, Ilumber of Inhabitants, Florida (Washington, D. C.: U. S. Govern-
ment Printing Office, 1961) Final Report PC(1)-11A.


Rates of population increase from 1930 to 1940 were nearly alike
in each milk marketing area except Southeast Florida (Table 15).
Since 1940, lNorthwest and Dortheast Florida had nearly the same rate
of increase in population. However, these areas lagged behind the
remainder of the State by a considerable amount, especially from
1950 to 1960.



32/Arizona and Nevada also had two decades (1940-1960) of
population growth at increasing rates, but with much smaller
population totals than Florida.





-27-


TABLE 15.--Total Population and Rate of Increase, by Milk Marketing
Areas, Florida, 1930-1960

: Milk Marketing Area
Year
SI orthwesti northeast Central: Tampa Bayi Southeasti Florida

Total Population
1930 293,916 322,396 278,777 312,420 260,612 1,468,121
1940 345,442 387,585 337,407 382,173 444,807 1,897,414
1950 436,814 521,797 470,453 560,537 731,713 2,771,314
1960 598,336 710,282 904,111 1,079,030 1,659,801 4,951,560

Percent Increase
1930 to
1940 17.5 20.2 21.0 22.3 70.7 29.2
1940 to
1950 26.5 34.6 39.4 46.7 75.7 46.1
1950 to
1960 37.0 36.1 92.2 92.5 112.3 78.7


Source: U. S. Bureau of the Census, U. S. Census of Population:
1.950, Vol. II, Characteristics of the Population, Part 10, Florida
(Washington, D. C.: U. S. Government Printing Office, 1952). Also,
U. S. Census of Population: 1960, Number of Inhabitants, Florida
(Washington, D. C.: U. S. Government Printing Office, 1961)Final
Report PC(1)-11A.


Trend in Urban Population.--In numbers of urban residents in 1960,
milk marketing areas ranked from smallest to largest were: Northwest,
Northeast, Central, Tampa Bay and Southeast (Table 16). The pro-
portion of total population classified as urban ranged from 51.3 per-
cent in Northwest to 90.1 percent in Southeast Florida. The major
consuming group for commercially processed and distributed fluid
milk is the urban population. Consequently, Southeast Florida, with
over one-third of the State's total population and 40 percent of its
urban inhabitants, requires the largest volume of fluid milk to meet
consumer needs of any area.

Milk marketing areas have become increasingly urbanized.33/
As shown in Table 17, the 1960 urban population of the State was
202 percent of the 1950 total. The greatest increases in urban



33/Changes in definitions of the Bureau of the Census for -
classifying population as urban residents occurred in 1950. Conse-
quently, only the relative change from 1950 to 1960 is presented.





-28-


TABLE 16.--Urban Population by Milk Marketing Areas, Florida, April 1960
Urban Population
Milk Marketing
Area Percent of Percent of
Number Area Total State Total
northwest 306,838 51.3 8.4
Northeast 488,084 68.7 13.3
Central 544,900 60.3 14.9
Tampa Bay 825,504 76.5 22.6
Southeast 1,496,057 90.1 40.8
Florida 3,661,383 73.9 100.0

Source: U. S. Bureau of the Census, U. S. Census of Population:
1960, Number of Inhabitants, Florida (Washington, D. C.: U. S. Govern-
ment Printing Office, 1960) Final Report PC(1)-11A.


TABLE 17.--Variation in Urban Population by Milk Marketing Areas,
Florida, 1950 and 1960

: Urban Population : Relative Change from 1950-1960 in
Milk Marketing :
Area :1950 : 1960 : Urban Residents: Share of State
: in Area :Urban Population
: : (1950=100) : (1950=100)

Northwest 178,769 306,838 172 85
northeast 321,221 488,084 152 84
Central 251,584 544,900 217 107
Tampa Bay 397,125 825,504 208 103
Southeast 665.197 1,496,057 225 111
Florida 1,813,896 3,661,383 202 100

Source: U. S. Bureau of the Census, U. S. Census of Population:
1960, Number of Inhabitants, Florida (Washington, D. C.: U. S. Govern-
ment Printing Office, 1961) Final Report PC(1)--11A.


population were in the more southerly located milk marketing areas
of the State. The urban population more than doubled in Central
Florida, Tampa Lay and Southeastern Florida from 1950 to 1960. The
addition to urban population in Northwest Florida was 72 percent
of the 1950 figure and 52 in northeast Florida.





-29-


These variations in relative growth resulted in a shift in the
portion of total urban population residing in each market. Northwest
and Northeast markets had a smaller proportion ot total urban popula-
tion in 1960 than in 1950. The remaining areas had a larger share
of the State total. The largest gains were in the Central and South-
east milk marketing areas.

Income.--Personal income received by Florida residents in
1959 was $9,723 million. The per capital income (total divided by
estimated population) was $1,937 (Table 18),34/ By milk marketing
areas, income per capital varied from $1,520 in Northwest Florida to
$2,183 in Southeast Florida. Variability in average income per
capital was greater among individual counties in each milk marketing
area than between areas. Generally, income per capital increased the
farther south the county and milk marketing area were located in the
State. However,this was not true for a few counties in the Tampa
Bay and Southeast milk marketing areas.


TABLE 18,--Income Per Capita by Milk Marketing Areas, Florida, 1950
and 1959

Milk Per Capita Percent of State Relative Change
Marketing Income Average from 1950-1959
Area 1950 1959 1950 1959 (1950=100)

Northwest $ 955 $1520 73 78 159
Northeast 1287 1945 98 100 151
Central 1265 1960 96 101 157
Tampa Bay 1235 1787 94 92 148
Southeast 1629 2183 124 113 134

Florida 1314 1937 ... ... 147


Source: Bureau of Economic and Business Research, University of
Florida, Economic Leaflets, Vol. XX, No. 2 (Gainesville, Florida:
University of Florida, College of Business Administration, February,
1961).




-4/M. L. Kafoglis, "Personal Income Received in Florida Counties,
1959," Economic Leaflets, Vol. XX, No. 2 (Gainesville, Florida: Bureau
of Business and Economic Research, College of Business Administration,
University of Florida, February, 1961).





-30-


Average per capital income increased from $1,314 in 1950 to
$1,937 in 1959.35/ The relative increase was greatest in the
market with the lowest income in 1950--Northwest Florida. During
this period, only Southeast Florida had an increase less than the
average for the State. However, despite the difference between
Northwest and Southeast Florida in percentage increase in per capital
income over the period, they each maintained their position as areas
with lowest and highest per capital income. Despite considerable
increases in per capital income in all markets, large differences
continued to exist between markets. The variation between counties
within each area also remained considerable in 1959.




































35/Ibid. These are the most recent estimates since 1960 census
data on income characteristics were not available at the time of this
study.









MILK MARKETING FACILITIES AND
DISTRIBUTION METHODS


TZesy of Firms


Firms handling fluid whole milk and milk products are of three
general types ;36 processor-distributor, producer-distributor and
distributor.

Processor-distributor firms are those which produce no milk
on farms, but purchase all milk supplies from regular producers or
other sources. They process, package and distribute milk products
through various market channels. Such firms are defined as "dis-
tributors"37/ in markets regulated by the Florida Milk Commission and
as "handlers" in the Southeastern Federal Milk Market Order.38/ Licenses
required by the Florida Department of Agriculture and issued to such
firms carry the designation "processor.".'9/ Firms of this nature are
termed "processor-distributors" throughout this publication.

In addition to processing, packaging and distributing dairy
products, producer-distributors also produce a part or all of their
milk from their own herds. To be classified as a producer-distributor
in areas under the jurisdiction of the Florida Milk Commission, a firm
must "produce at least 75 percent of the milk processed and prepared
for sale.40/ In the federal market order area in Southeast Florida,
firms of this type are known as "producer-handlers."41i/ To meet the
requirements for this designation, such a firm must produce all the
milk it markets in fresh fluid form. The term producer-distributor
is used in conformance with local market definitions in this publi-
cation. The method used to classify firms in Northwest Florida was
the same as that used by the Florida Milk Cormnission.



36/Exclusive of retail establishments.

37/Florida Statutes, Chapter 501, Part 501.02.

38/"Proposed Rule Making, Milk Handling, Market Areas; South-
eastern Florida," Federal Register, Vol. 22, No. 136 (Washington,
D. C., 1957) p.5588.

39/Florida Department of Agriculture, Dairy Division, Tallahassee,
Florida.

40/Florida Statutes, op. cit.
41/Federal Register, op. cit,


-31-








-32-


Distributors are firms which sell milk and milk products but
do no processing or packaging of such products. Many of these enter-
prises exist in each market in Florida and are generally referred to
by the colloquial term "bob-tailer."42/


Number and Location of Firms

In 1959 the Florida Department of Agriculture issued licenses to
64 processor-distributors, 46 producer-distributors and 40 distributors
(Table 19). The number of licensed firms of each type changed consider-
ably during the past ten years. The number of processor-distributors
licensed increased from 59 in 1951 to 64 in both 1957 and 1959, but
declined to 57 in 1961. Companies licensed as producer-distributors
declined from 56 in 1957 to 46 in 1959 and 39 in 1961. Distributor
permits increased from 32 to 106 from 1957 to 1961.


TABLE 19.--Number of Different Types of Dairy Firms Licensed by Florida
Department of Agriculture by Milk Markets Area, Florida, Selected Year,
1951 to 1961

Year Milk Marketing Area

:Northwest' Northeast: Central: Tampa Bay' Southeast Florida

Processor-Distributor
1951 8 9 14 13 15 59
1952 9 9 13 13 17 61
1957 11 10 9 17 17 64
1959 13 10 7 18 16 64
1961 11 8 7 17 14 57
Producer-Distributora
1957 8 24 14 5 5 56
1959 7 21 10 4 4 46
1961 7 18 5 2 4 36
Distributor
1957 2 7 3 8 12 32
1959 2 8 8 8 14 40
1961 13 22 20 12 39 106


Source: Florida State Department of Agriculture, Division of
Dairy Industry, Tallahassee, Florida.

aInformation on numbers of producer-distributor and distributor
licenses issued was available only for 1957,1959 and 1961.



42The term is given status by definition in Florida Statutes.








-33-


The large increase in number of distributors can be explained
in a number of ways. Part was a shift in classification because of
a change in method of operation. Some of the national processor-
distributors closed plants in small towns to consolidate the proc-
essing of the milk in larger plants. They then handled their business
in these areas through distributor units. During the period some
people changed from producer-distributors to distributors.

The rapid growth of suburban areas was a factor in the increase
in number of distributors. This has resulted in greater distances
from existing processing plant locations to points of consumption.
Distributing branches were open in these areas. It is apparently
considered more efficient to process the milk in larger plants but
to operate retail and wholesale delivery routes from a central point
in or near consumption areas.

Facilities for processing dairy products are located throughout
the State (Fig. 3). Most are within the more highly urbanized centers
of population and are within reasonable shipping distance from present
supply areas. Producer-distributors generally are also located with-
in the heavily populated counties. The greatest number of producer-
distributors werein Northeast Florida. Twenty-one of the 46 such
licenses issued in 1959 were to firms in that market. Brevard,
Charlotte, Monroe, Seminole and several other counties, which have
experienced large urban population growth in recent years, are
served only by firms which distribute fluid milk. Many of these
firms are owned and operated by multi-unit processing and distri-
buting companies.


Size of Firms

Dairy firms may be stratified by several measures of size. The
fluid milk processing capacity of plant facilities may be used as one
measure. A second measure may be average daily sales of fluid milk.
The first measure is probably best for determining the variation
in efficient use of processing capacity by size of firm. To show
the relative market shares of various size firms, the second is more
suitable.

Firms were grouped into three size classes-small, medium and
large-on the bases of fluid milk processing capacity of plant facilities
in an eight-hour period. Plants with facilities to process less than
2,500 gallons in an eight hour period were classified as small;
2,500 to 9,999 gallons, medium and 10,000 gallons or more as large.
Small firms predominated in Northeast, Northwest and Central Florida.







-34-


# Processor-distributor
X Producer-distributor
* Distributor


Fig. 4.--Number and location of different types of dairy
firms in Florida, by counties, 1959.

Source: Florida State Department of Agriculture, Division
of Dairy Industry, Tallahassee, Florida.







-35-


TABLE 20.--Number of Fluid Milk Processing Plants in Various Milk
Marketing Areas by Size of Plant, October 1959

: :VFluid Milk Processing Capacity
Milk : : per 8-Hour Period
Marketing : Number of : Total : Average Gal.
Area : Plants : Gallons : per Plant


Northwest
Northeasta
Central
Tampa Bayb
Southeast

Total


Northwest
Northeast a
Central
Tampa Bayb
Southeast


7
20
10
6
2

45


4
4
2
5
6


Total


Northwest
Northeasta
Central
Tampa Bayb
Southeast

Total


Northwest
Northeast
Central
Tampa Bayb
Southeast

Total


3
2
3
5
9

22


14
26
15
16
17

88


Small Firms
4,500
12,200
7,300
5,700
1,000

30,700

Medium Firms
21,080
25,000
11,500
28,500
38,850

124,930

Large Firms
37,000
20,200
46,000
197,400
189,540

490,140

All Firms
62,580
57,400
64,800
231,600
229,390

645,770


Source: Estimates of capacity by either enumerator
ager based on plant processing equipment available.


or plant man-


aNo estimate available for four plants-one with sales under
2,500 gallons per day, one with sales between 2,500 and 10,000 gallons
per day and two with sales over 10,000 gallons per day.

bNo estimate available for one plant with sales between 2,500
and 10,000 gallons per day.


643
610
730
950
500

682


5,270
6,250
5,750
5,700
6,475

5,950


12,333
10,100
15,333
39,480
21,060

22,279


4,470
2,208
4,320
14,475
13,494

7,338


--










There were six small, five medium and five large firms in the Tampa
Bay area. In Southeast Florida, there were two small dairy firms,
six medium and nine large. In markets where small firms were most
numerous relative to other size dairy plants, their total capacity
was low relative to their numbers. In Northwest Florida, for
example, one-half of all firms were small, but their combined
processing capacity was less than one-tenth of the total for all
firms. Only in Northeast Florida did medium size firms have a
combined processing capacity greater than that for all large plants.
The greatest portion of the total market facilities for processing
fluid milk in all other markets is that of the large dairy companies.

Fluid milk processing and distributing firms, when grouped by
size on the basis of average daily volume of fluid milk sold, tended
to fall within a range of three naturally occurring volume classifica-
tions (Table 21). Small firms were those with sales under 2,500 gal-
lons daily. In each area, the upper limit for these firms could
have been set at a lower figure since no firm had sales over 2,000
gallons. Medium size firms were those with sales from 2,500 to
9,999 gallons. The large firms all had sales of 10,000 gallons and
over daily. It should be noted that the number of firms of a given
size in various market areas is not always the same for the two
measures of size--plant processing capacity and average daily sales.
This is true because in several cases a plant's processing capacity
was sufficiently above or below average daily sales to cause a firm
to be classified in a different size group, depending upon the
factor used. Average daily sales of each size of plant varied more
between firms in a given market than did the average daily sales
for the group between markets. The size of market served seemed
to be related to the size of plant most common in the area. North-
west Florida, the smallest market in terms of population numbers
and density, had no plant with sales over 10,000 gallons per day.
There were eight small and six medium size plants in this market
and the largest had daily sales of 5,600 gallons. The largest
daily sales of any plant in the State were 27,000 gallons by a
firm in Southeast Florida, nearly five times the volume of sales
of the largest plant in Northwest Florida.


Efficiency of Firms

The efficiency of processing plants in the three size groups
can be partially measured by comparing the percent of fluid milk
processing capacity utilized. Such a measure was obtained by
dividing estimated capacity per eight-hour period by average daily
sales 43/ of fluid milk (Tables 22 and 23). This percentage for all



43/Average daily sales of each plant are given in Appendix B.







-37-


TABLE 21.--Number
Ranges in


of Processing and Distributing Firms, Average and
Daily Sales by Milk Marketing Area and Size
of Firm, April and October 1959


Milk Number Average Range
Marketing of Firmsa Daily Sales i Low High
Area
(Gallons) (Gallons)


Northwest
Northeast
Central
Tampa Bay
Southeast
Average or Total

Northwest
Northeast
Central
Tampa Bay
Southeast
Average or Total


Northwest
Northeast
Central
Tampa Bay
Southeast
Average or Total


Northwest
Northeast
Central
Tampa Bay
Southeast
Average or Total


8
23
10
8
2
51

6
7
3
5
10
31


0
1
2
4
5
12


14
31
15
17
17
94


Small Firms

500
371
412
761
294
457
Medium Firms
5,651
5,686
6,338
4,479
5,013
5,331

Large Firms


10,181
13,685
14,320
18,411
15,574
All Firms
2,708
1,888
3,367
5,051
8,398
3,996


Source: Records of individual firms.

aSeveral Firms operate more than one processing and distributing
facility. Each individual plant was considered as a firm in this publi-
cation. Producer-distributors are also included in this table.


57
15
53
69
80
15

2,990
2,653
4,843
2,941
2,578
2,578


13,294
12,009
12,907
12,009


57
15
53
69
80
15


510
1,986
808
1,782
508
1,986

5,651
9,271
9,084
6,782
9,550
9,550


14,075
19,938
27,197
27,197


5,651
10,181
14,075
19,9-8
27,197
27,197







-38-


TABLE 22.--Average Total Daily Sales of Fluid Whole Milk and By-Products
of Processing and Distributing Firms by Milk Marketing Area
and Size of Firm, April and October 1959


Milk Size of Firm
Marketing : All
Area : Small i Medium : Large- : Firms


Northwest
Northeast
Central
Tampa Bay
Southeast


Northwest
Northeast
Central
Tampa Bay
Southeast


Northwest
Northeast
Central
Tampa Bay
Southeast


Northwest
Northeast
Central
Tamp Bay
Southeast


3,997
8,529
4,124
6,091
588


Fluid Whole Milk
33,908
39,804
19,015
22,394
50,126


(gallons)

10,181
27,369
57,281
92,053


Fluid, Cultured and Flavored Skim Milk


460
636
305
484
46


'37
46
26
103



81
238
39
88
. *


4,370 ...
4,246 .
2,154 3,140
2,157 7,753
4,788 9,345
Fluid Cream (gallons)


415
755
374
468
1,332


Cottage Cheese
1,727
3,084
1,518
813
3,290


392
1,598
3,432


(pounds)


2,828
7,488
9,323


Source: Records of individual firms.


plants in the State ranged from a low of 34 in Tampa Bay to 78 in
Central Florida. The relation between size of plant (measured by
processing capacity) and efficiency (measured by percent of capacity
utilized) was not consistent between areas. In the Tampa Bay area,
small plants were most efficient. In Northwest and Central Florida,


37,905
58,514
50,508
85,766
142,767


(gallons)
4,830
4,882
5,599
10,394
14,179


452
801
792
2,169
4,764


1,808
3,322
4,385
8,389
12,613






-39-


TABLE 23.--Average Percent Utilization of Processing Capacity in Fluid
Milk Processing Plants by Milk Marketing Area and Size of
Plant, April and October 1959


Size of : Milk Marketing Area: All
Plant :Northwest :Northeast :Central: Tampa Bay: Southeast: Areas
Percent

Small 34.8 37.5 53.5 77.7 54.7 46.8
Medium 71.8 53.6 121.1 48.5 59.8 64.1
Large 57.4 91.0 70.6 30.8 62.8 58.4

All Plants 60.6 63.3 77.6 34.1 62.2 59.9


Source: Based on data in Table 20 and Appendix B.


medium firms operated at the highest capacity. Largest size dairy
plants in Northeast and Southeast Florida were most efficient. Changes
over time in relative market shares of the various milk plants could
be a possible cause of the variation within size groups in percent
of capacity utilized. Firms of any size can experience declining
market shares of total fluid milk sales. If processing equipment
were of optimum capacity when purchased, declining sales would result
in lower utilization of the rated plant capacity. Unfortunately,
data are not available to show whether such changes in market shares
did occur over time. Also, a firm may build a new large plant in
anticipation of market growth. Until the expected increase in volume
is realized, processing capacity will not be utilized at the rated
level.


Market Shares of Firms

The market share of fluid milk sales for small firms tended to
decrease with increasing size of market (Table 24). In Northwest
Florida, where there were no large firms, eight small plants shared
slightly more than ten percent of the total market sales of fluid milk.
In Northeast Florida, the combined sales of nine small firms was
14.6 percent of the market. The one large firm in this area averaged
17.4 percent of daily market-wide sales. Approximately two-thirds of
the total fluid milk sales in Tampa Bay was shared by four large
dairies; in Southeast Florida, five plants shared about two-thirds of






-40-


TABLE 24.--Market Shares of Fluid Milk and By-Products Sales of Dairy
Firms, by Milk Marketing Area and Size of Firm, April and October 1959

: Product
Milk : : :
Marketing Skim Milk :
Area :Fluid Milk : Products : Fluid Cream : Cottage Cheese
Percent

Small Firms
Northwest 10.5 9.5 8.9 4.5
Northeast 14.6 13.0 5.7 5.7
Central 8.2 5.5 3.3 0.9
Tampa Bay 7.1 4.7 4.8 1.1
Southeast 0.4 0.3

Medium Firms

Northwest 89.5 90.5 91.1 95.5
Northeast 68.0 87.0 94.3 94.3
Central 37.7 38.5 47.2 34.6
Tampa Bay 26.1 20.8 21.6 9.7
Southeast 35.1 33.8 28.0 26.1

Large Firms

Northwest ... .... **
Northeast 17.4 ......a a
Central 54.2 56.1 49.5 64.5
Tampa Bay 66.8 74.6 73.7 89.3
Southeast 64.5 65.9 72.1 73.9


Source: Records of individual firms.


aNo data on by-products sales were available
firm in the Northeast milk marketing area.


from the one large


sales. Increasing population 44/ and decreasing plant numbers/ in all
markets should result in larger plants with greater market shares per
firm. Changes in the technology of processing and distributing milk
may also tend to increase plant sizes generally. The greater concentra-


44Above, Table 15, p. 28.
45/
- Above, Table 19, p. 33.






-41-


tion of population 46/ in the more southerly markets possibly tended to
make the few large plants the most efficient size processing unit in
those areas. This is a result of the economics of large-scale fluid
milk processing facilities.

In addition to the sizeable market share of fluid milk sales
held by large firms, they marketed an even greater portion of the
fluid milk by-products consumed in each area. In every market, small
dairy firms sold a smaller portion of skim milk products, fluid creams
and cottage cheese than of fluid milk.47/ The continued practice of
many small dairy firms of offering a full line of dairy products with
relatively small sales volumes for most by-products may well be ex-
cessively expensive. In such small firms, however, the problem of
joint costs for many products makes for complex decisions as to adding
or dropping one.


Milk Distribution Methods


Marketing Channels

The distribution and final sale of dairy products to consumers
may be accomplished through several alternative marketing channels
(Fig. 4). Processing and distributing firms, including producer-
distributors, may obtain their supplies of raw milk, cream and other
dairy ingredients from numerous sources. Dairy farmers, each shipping
to a single plant, are the normal origin for the largest part of milk
supplied to most dairy processing plants. Temporary supply sources and
emergency milk shipments during periods of short production may origin-
ate with milk brokers, other processing firms and farmer cooperative
bargaining associations. These firms may arrange shipments from pro-
duction areas within Florida or from other states. An additional
source of supply to producer-distributors is milk produced by herds
on their own farms.4"/

Processing and distributing firms use many combinations of mar-
keting channels to move packaged dairy foods to consumers. The most
direct channel is retail sales of products to consumers from company-
owned retail dairy stores or house-to-house delivery routes. Firms
also sell at wholesale directly to retail food outlets (grocery stores,
eating places, soda fountains) institutions (hospitals, schools) and


4Z/The only exception being a slightly smaller portion of cream
than fluid milk sales by large firms in Central Florida.

48/Volumes and relative amounts of milk supplies received from all
sources will be presented in the next section.







-42-


Fig. 4.--Marketing channels for Florida fluid milk and milk
products.







-43-


military installations. These sales, direct retail and wholesale, may
be made from the processing plant or from distribution branches. A
third method of distribution is selling to independent distributors,
either at the plant (platform sales) or delivered to the distributor's
own cold storage and distribution facility. Many dairy processors
employ all three, concentrating in varying degrees on each distribu-
tion channel. Most small producer-distributors sell all their products
from a single retail dairy store located on the farm or a single retail
delivery route operated in a small town.

The greatest volume of sales of the majority of dairy firms is
from retail distribution, based on a simple average of sales by various
distribution methods (Table 25). Weighting percent of sales through
each distribution channel with volumes handled indicated, however, that
a larger physical volume of milk products was moved by wholesale sales
than by any other method of distribution from processing plants. The
large firms tend to sell most of their volume through wholesale outlets.
Data were not obtained to show relative volumes sold to each type of
wholesale outlet. Dairy processing firms distributing their products
thus require any one or a combination of the following marketing
facilities: retail stores, retail or wholesale delivery trucks and
branch distribution facilities. Information provided by Florida
dairy firms showed only one case where all products processed were
distributed by an independent agent who received all products at the
loading platform of the dairy processor.

The measurement or relative efficiency in utilization of milk
distribution facilities, chiefly retail and wholesale delivery vehicles,
was more complex than was true of processing plants. Even for retail
or wholesale trucks of the same carrying (load) capacity, many variables
of differing relative importance complicated most attempts to measure
efficient use of equipment.

The data obtained included the number of retail and wholesale
delivery routes operated by each firm (Table 26). The 54 firms operat-
ing 1,196 retail routes had average daily sales of 87 gallons of fluid
milk per retail route. In the Northeast, Central, Tampa Bay and South-
east markets, the range was from 76 to 82 gallons daily. In the North-
west area, retail sales averaged 118 gallons per day. The 37 firms
distributing fluid milk to wholesale outlets operated 453 routes.
Average daily fluid milk sales were considerably higher on wholesale
than on retail routes. In four markets,volume ranged from 268 to 286
gallons offluidmilk sold per day. In the Southeast area, sales
averaged 311 gallons per day. Although it was not possible to determine
if any relationship existed between size of firm and distribution effi-
ciency, the data indicated that relatively small differences existed
between most markets in Florida in average daily sales on milk distri-
bution routes.






-44-


TABLE 25.--Percent of Sales by Retail, Wholesale and Platform Distribu-
tion, by Milk Marketing Area, April and October 1959

Distribution Method
Milk Retail Wholesale Platform
Milk Retailr
Marketing All Firms All Firms
Area Simple : Weighted: :Simple : Weighted: :Simple :Weighted
:Average: Average : Average: Average :Average :Average
Percent
Northwest 71 29 25 57 4 14
Northeastb 74 26 23 56 3 18
Centralc 64 46 30 48 6 6
Tamp Bayd 48 47 38 42 14 11
Southeast 55 41 30 43 15 16

Florida 63 39 29 48 8 13


Source: Records of individual firms.

aIncludes all firms in the market.

bIncluded 29 of 31 firms in the market.

CIncludes all firms in the market.

dIncludes 15 of 16 firms in the market.

eIncludes 15 of 17 firms in the market.


Types and Sizes of Packages
for Fluid Milk Products

Fluid milk products are packaged for distribution in refillable
glass bottles, single-service paper cartons and refillable metal cans.
By size, consumer packages range from one-half pint to one gallon for
glass bottles and from one-half pint to one-half gallon for paper
cartons. The standard size metal dispenser can is five gallons. A total
of ten types and sizes were available for packaging fluid milk products
(Table 27). With a minimum of ten fluid milk products commonly distrib-
uted by dairy firms, the product mix could include 100 combinations of
product, package type and size of container. Since many firms distribute
two, three or even four types of fresh whole milk, two types of fluid
skim milk and buttermilk, numerous non-fluid dairy products and other
non-dairy items, it is not uncommon for a firm's product mix to run as
high as 130 to 140 items.







.45-


TABLE 26.--Number of Retail and Wholesale Milk Routes and Average Number
of Gallons Sold per Route per Day, by Milk Marketing Area,
April and October 1959

Milk : Number of Routes : Gallons Sold per Day per Routea
Marketing
Area :Retailb : Wholesalec Retail ; Wholesale

Northwest 114 61 118 276
Northeast 83 58 80 286
Central 135 68 80 280
Tampa Bay 339 98 76 268
Southeast 525 168 82 311
Total or 1,196 453
Average 87 284

Source: Records of individual firms.

aAverage for the two months,

bData from 54 firms operating retail milk routes in Florida.

cData from 37 firms operating wholesale milk routes in Florida.


TABLE 27.--Package Types and Sizes Used for Fluid Milk Products by
Dairy Firms, in Florida


Package Type
and Size



Gallon
Half Gallon
Quart
Pint
Half Pint


Half Gallon
Quart
Pint
Half Pint


5 Gallon


Type of Product
Whole:Skim:Butter- : Chocolate:
Milk :Milk: milk :Milk :Drink:


Cream : Half &
Heavy:Light: Half


Glass Bottles


X X
X X
X X
X X


Paper Cartons


x x x x x x x
x x x x x x
x x x x x x x
Dispenser Cans
X X X X X X X
X X X X X X
X X X X X X X
Dispenser Cans
X X X X X X X


Source: Records of individual dairy firms.







-46-


The package types and sizes in which the greatest volume of
product was sold varied considerably by product and also between markets
for a given product. Paper cartons accounted for 51 to 59 percent of
fluid milk sales in the Northeast, Tampa Bay.and Southeast markets.
Only 44 percent of whole milk sales in Central Florida was in paper
cartons. The highest use of paper cartons was in Northwest Florida with
84 percent of total fluid milk sales in this type of container. For
most other fluid milk products, paper cartons predominated.49/ From 75
to almost 100 percent of all skim milk, buttermilk, chocolate milk and
cream were purchased in paper packages by consumers.

In all markets, more fluid whole milk was sold in half-gallon
containers than in any other size. Gallon jugs accounted for a smaller
volume of sales of fluid milk than half-pint containers. Even in the
Southeast Florida market where sales of gallon-size packages were
highest (9.30 percent), half-pints were more important in terms of total
volume of milk sold (10.36 percent). Quart size containers were the
most popular size in most markets for all fluid milk by-products,
except creams. These data are for a single time period only, hence
it was not possible to ascertain any trends in preference of Florida
consumers as to package type and size combinations.


9/Complete data are given in Appendix C.










MILK SUPPLY, MOVEMENT, UTILIZATION AND PRODUCTION
CONSUMPTION BALANCE IN FLORIDA MARKETS


Production, Farm Disposition and Income
to Farmers, 1925-1959

With its rapidly expanding population, Florida's needs for fluid
milk have continually increased in all milk marketing areas. Subtropical
climate, soil, animal and plant pests and diseases all add to the
problems of producing milk. These factors contribute to a relatively
higher cost of production However, during the period for which data
were collected, only minor reliance was made on fluid milk supplies
originating outside of Florida. Most of the need for temporary ship-
ments from other states was a result of seasonal shortages in the local
producer supply.

Production of Milk.-- Dairy farming in Florida has experienced
the same rapid growth that has characterized the State's total agri-
cultural economy. From 1925 to 1959, numbers of milk cows increased
threefold. Production per cow in 1959 was above 227 percent of the
1925 level; total milk production was almost six times the amount at
the beginning of the period. In 1959, 192,000 cows, with an average
production of 6,460 pounds per cow, produced a total of 1,240,000,000
pounds of milk (Table 28).

Disposition and Income to Farmers from Milk Sales.--Marketing
of milk produced on farms has changed considerably since 1925 (Table 29).
Farmers now sell most of their output to plants as whole milk rather
than as farm-separated cream. Milk utilized on farms, marketed at
retail and delivered to plants accounted for nearly equal portions of
the total production in 1925. Less than 10 percent of output in 1959
was used on farms and sold by farmers at retail. Of the total produc-
tion of milk, 37 million pounds were used on farms, 43 million pounds
were retailed as whole milk and cream and the remainder was sold as
whole milk to processing plants. The average price received for milk
decreased from 1925 to 1940, rose in 1945 and was nearly stable at
about $7,00 per hundredweight from 1950 to 1959. In 1959, the total
income received from milk was $83,916,000. This was nearly ten times
the $8,865,000 received in 1925.


-47-







-48-


TABLE 28.--Number of Cows, Production per Cow and Total Production of
Milk, Florida, Selected Years, 1925 to 1959

Production Total Production
Number of per Cowb Butterfat on Farmsb
Year Milk Cows Percent
on Farmsa Milk Milk Fat percent Milk Milk Fat


Thousand Pounds Pounds Percent Million Million
Pounds Pounds
1925 74 2,850 123 4.30 211 9
1930 86 2,800 120 4.30 241 10
1935 98 2,960 127 4.30 290 12
1940 101 3,400 144 4.25 343 15
1945 120 3,900 166 4.25 468 20
1950 136 4,400 187 4.25 598 25

1955 175 5,050 210 4.15 884 37
1956 179 5,600 230 4.10 1,002 41
1957 185 5,880 241 4.10 1,088 45
1958 189 5,910 242 4.10 1,117 46
1959 192 6,460 265 4.10 1,240 51


Source: U. S. Department of Agriculture, Agricultural Marketing
Service, Dairy Statistics, Statistical Bulletin No. 218 and No. 282
(Washington, D. C., October 1957 and April 1961). Also, Florida State
Department of Agriculture, Florida State Marketing Bureau, Annual
Agricultural Statistical Summary 1959-60 (Tallahassee, Florida,
November 1960).

aAverage number during year, heifers that have not freshened
excluded.

bExcludes milk sucked by calves and milk produced by cows not
on farms.


Location, Volume and Movement of Supplies
of Milk Sold by Producers,
April and October 1959


Location and Volume of Sales

During the months of April and October 1959, Florida dairy pro-
cessing firms received 192,340,000 pounds of milk from Florida pro-
ducers (Table 30). Supplying producers were located in 60 of the







-49-


TABLE 29.--Milk Disposition and Income to Farmers, Florida, Selected
Years, 1925 to 1959

Delivered
Retailed to Plants Total Cash Receiptsd
Total Uti- by and Dealers Milk
Year Farm lized Farmers and Per Hun-
Pro- on as Milk As As Cream dred- Total
ductiona Farmsb and Whole Cream Marketed weight
Creamc Milk

Million Million Million Million Million Million DollarsT thousand
Pounds Pounds Pounds Pounds Pounds Pounds -- Dollars
1925 211 76 70 59 6 135 6.29 8,865
1930 241 80 70 86 5 161 5.62 9,442
1935 290 96 74 112 8 194 4.19 8,459
1940 343 90 75 172 6 253 4.09 10,632
1945 468 83 80 304 1 385 5.44 21,225
1950 598 74 78 446 --- 524 7.05 37,300

1955 884 56 57 771 --- 828 6.99 57,867
1956 1,002 52 53 897 --- 950 6.89 65,495
1957 1,088 46 48 994 --- 1,042 7.02 73,149
1958 1,117 42 45 1,030 --- 1,075 7.06 75,946
1959 1,260 37 43 1,160 --- 1,203 6.98 83,916


Source: U. S. Department of Agriculture, Agricultural Marketing
Service, Dairy Statistics, Statistical Bulletin No. 218 and No. 282
(Washington, D, C.: October 1957 and April 1961). Also, Florida State
Department of Agriculture, Florida State Marketing Bureau, Annual Agri-
cultural Statistical Summary 1959-60 (Tallahassee, Florida: November 1960).

aExcludes milk sucked by calves and milk produced by cows not on


farms.


bIncludes milk used on farms where produced as fluid milk or
cream, farm-churned butter and feeding to calves.

cApproximations based on information on sales by producer-
distributors and other farmers on own routes or at farm.

dFor 1950 and earlier years, includes cash receipts from farm-
churned butter.


eCash receipts divided by total milk marketed.






-50-


TABLE 30.--Amount of Grade A Milk Sold by Florida Producers, Percent of
Total Production and County Rank in Area and State, by Milk Marketing
Areas and Counties, April and October 1959

Milk Marketing Amount of Milk Percent of Total in: Rank in:
Area and Sold
County (1,000 Pounds) Area State Area State


Santa Rosa
Escambia
Leon
Lafayette
Jackson
Holmes
Jefferson
Washington
Calhoun
Madison
Walton
Gadsden
Bay
Gulf
Okaloosa
Dixie
Franklin
Liberty
Taylor
Wakulla
Total


Duval
Clay
Alachua
St. Johns
Putnam
Baker
Union
Suwannee
Columbia
Nassau
Hamilton
Gilchrist
Bradford
Levy
Total


3,835
3,658
2,064
1,789
1,275
866
799
694
666
633
413
369
337
34
28





17,460


18,779
6,538
1,223
1,215
1,019
965
440
386
295
287
271
146
52
44
31,660


Northwest
21.9
21.0
11.8
10.2
7.3
5.0
4.6
4.0
3.8
3.6
2.4
2.1
1.9
0.2
0.2





100.0

Northeast
59.3
20.7
3.9
3.8
3.2
3.0
1.4
1.2
0.9
0.9
0.9
0.5
0.2
0.1
100.0


aLess than 0.05 percent


2.0
1.9
1.1
0.9
0.7
0.5
0.4
0.4
0.3
0.3
0.2
0.2
0.2
a--a
---a


12
14
19
20
25
32
34
35
37
39
43
46
47
59
60





5


9.9
3.5
0.6
0.6
0.5
0.5
0.2
0.2
0.2
0.1
0.1
0.1
---a
--- a
16.5


Source: Florida Milk Commission--Northeast, Central and Tampa Bay
market areas; Southeast Florida Milk Marketing Area Market Administrator--
Southeast market area; schedules from individual plants--Northwest market
area.






-51-


TABLE 30.--Continued

Milk Marketing Amount of Milk Percent of Total in: Rank in:
Area and Sold
County (1,000 Pounds) Area State Area State


Orange
Polk
Volusia
Seminole
Marion
Lake
Osceola
Sumter
Brevard
Flagler
Citrus
Total


Hillsborough
Pinellas
Manatee
Highlands
Pasco
Sarasota
Hardee
Lee
DeSoto
Hernando
Charlotte
Total


Broward
Palm Beach
Dade
Okeechobee
Martin
Glades
St. Lucie
Hendry
Indian River
Collier
Monroe
Total


8,599
7,196
3,303
2,695
1,615
1,534
940
587
455
298
285
27,508


25,106
6,904
5,844
3,700
2,692
997
657
373
262
198
54
46,787


26,400
21,679
6,674
5,966
3,583
1,673
1,480
802
667


68,925

192,340


Central
31.2
26.2
12.0
9.8
5.9
5.6
3.4
2.1
1.7
1.1
1.0
100.0

Tampa Bay
53.6
14.8
12.5
7.9
5.8
2.1
1.4
0.8
0.6
0.4
0.1
100.0

Southeast
38.2
31.5
9.7
8.7
5.2
2.4
2.1
1.2
1.0


100.0


Floid 100.0-----


4.5
3.7
1.7
1.4
0.8
0.8
0.5
0.3
0.2
0.2
0.2
14.3


13.2
3.6
3.0
1.9
1.4
0.5
0.3
0.2
0.1
0.1
---a
24.3


13.7
11.3
3.5
3.1
1.9
0.9
0.8
0.4
0.3


1
3
8
10
15
21
24
33
36


35.8


100.0


Florida






-52-


67 counties of the State. Five of the counties from which no milk was
supplied--(Dixie, Franklin, Liberty, Taylor and Wakulla)--were in
Northwest Florida. The other two counties--(Collier and Monroe)--were
located in Southeast Florida.

Of the five milk marketing areas, Southeast Florida ranked first
in amount of milk sold by farmers. Producers in that area marketed
68,925,000 pounds, or 35.8 percent of the total for the State. Other
markets in order of rank were: 46,787,000 pounds in the Tampa Bay
area; 31,660,000 pounds in the Northeast area; 27,508,000 pounds in the
Central area; and 17,460,000 pounds in the Northwest area. This was
123,415,000 pounds, or 64.2 percent for the four areas.

For the two months combined, three counties shipped over 20 mil-
lion pounds each. Broward County ranked first in the State, delivering
26,400,000 pounds. Hillsborough County producers, with a production of
25,106,000 pounds, had the second largest volume. Palm Beach County
producers were third with an output of 21,679,000 pounds. Duval County
ranked fourth with an output of 18,779,000 pounds--slightly under the
top three. Production in these four counties, all of which are among the
most heavily populated in the State, accounted for 48.1 percent of the
total milk output.


Amount and Source of Producer Milk Supplies by Milk Marketing
Areas.5-/ The major portion of producer milk in each marketing area
came from producers located in that area. However, Northeast Florida
was the only area not receiving some milk from producers outside of the
area.


Northwest Area.--The fluid milk supply area for Northwest Florida
included fifteen counties within the area, three counties in the North-
east market area and several counties in Southeastern Alabama (Figure 5).
During the months of April and October 1959, a total of 20,722,000 pounds
of milk was received from regular producers. No milk produced on farms
within the area was shipped to other Florida markets.

Dairy farmers located in Northwest Florida supplied 84.3 percent
of market receipts (Table 31). Producers in Alabama holding Florida
permits and supplying plants in Pensacola accounted for 14.1 percent of
total market receipts. Dairy farms located in three Northeast counties--
Duval, Gilchrist and Suwannee--supplied 1.6 percent of market needs.
Milk on one farm in the Northeast area (Duval County) was shipped nearly
175 miles to a Tallahassee fluid milk plant. Total producer receipts


50/ Producer milk supplies included only those receipts origi-
nating from farmers with Florida permits and delivering regularly. No
receipts from temporary supply sources were included.













Duval--102


Supplies in thousands of pounds.


Fig. 5.--Amount of Grade A milk by counties supplied by producers to milk plants in Northwest Florida,
April and October 1959.







-54-


from all areas and production within the market for the months of April
and October 1959 are given in summary form as a part of Table 31.


TABLE 31.--Amount of Grade A Milk Supplies of Producers in Various Milk
Marketing Areas and Distribution of Area Producer Supplies to Pro-
cessing Plants in Various Marketing Areas, April and October 1959

Total Production
Milk o Producion Amount of Area Producer Supplies
Marketing f Pro ers to Processing Plants in:
Area n rea Northwest: Northeast: Central: Tampa Bay: Southeast

Amount of Milk (1,000 Pounds)
Northwest 20,382a 20,382a ----- --- ----- ---
Northeast 31,660 340 29,586 1,734 ----- -----
Central 27,508 ----- ---- 21,625 3,630 2,253
Tampa Bay 46,787 ----- -- 363 43,104 3,320
Southeast 68,925 ---- ----- 116 213 68,596
Total
Receipts 195,262 20,722 29,586 23,838 46,947 74,169

Percent of Total Producer Supplies
in Area Delivered to Plants in:
Northwest 100.0 100.0 ---- ----- ----- -----
Northeast 100.0 1.1 93.4 5.5 ----- -
Central 100.0 ----- ----- 78.6 13.2 8.2
Tampa Bay 100.0 ----- ----- 0.8 92.1 7.1
Southeast 100.0 ----- ----- 0.2 0.3 99.5

Percent of Total Producer Receipts
in Area from Producers in:

Northwest ----- 98.4 ----- ----- -----
Northeast ----- 1.6 100.0 7.3 ----- -----
Central ----- ----- ----- 90.7 7.7 3.0
Tampa Bay ----- ----- ----- 1.5 91.8 4.5
Southeast ----- ----- ----- 0.5 0.5 92.5
Total
Receipts ---- 100.0 100.0 100.0 100.0 100.0


Source: Florida Milk Commission--Northeast, Central and Tampa Bay
market areas; Southeast Florida Milk Marketing Area Market Administrator--
Southeast market area; schedules from individual plants--Northwest market
area.

aIncludes 2,922,100 pounds of fluid milk from Alabama milk
producers.







-55-


Northeast Area.--All producers supplying the Northeast milk
marketing area were located within the fourteen-county area (Figure 6).
Total receipts at area plants were 29,586,000 pounds for the two months.
This was 93.4 percent of the total sales of milk by area producers. The
major portion of farm shipments was sold to dairy plants in Duval County.

Dairy farmers in Duval County, the most heavily populated within
the area, supplied 18,112,000 pounds of milk to area plants. This was
61.2 percent of market receipts from Florida producers. Clay County
dairies were second with 6,267,000 pounds, which was 21.2 percent of
supplies. A portion of total supply was received from each county in
the area. Levy County was the lowest with 44,000 pounds, or 0.1 percent
of total producer milk deliveries.


Central Area.--Milk receipts at dairy plants in Central Florida
originated in all of the eleven counties in the area, four counties in
Northeast Florida and one county each in the Southeast and Tampa Bay
areas. Total market receipts for the months of April and October 1959
were 23,838,000 pounds. Dairy farmers within Central Florida counties
accounted for 21,625,000 pounds, or 90.7 percent of receipts from
Florida producers. Northeast area milk producers shipped 1,734,000 pounds,
which was 7.3 percent of the total supply. Tampa Bay and Southeast dairy
farms delivered 1.5 and 0.5 percent of producer milk supply, respectively.

During the two-month period, 21.4 percent of the total area output
was delivered to plants in other areas. Plants in the Tampa Bay area
received 3,630,000 pounds of milk from Central Florida producers. Ship-
ments to Southeast Florida were 2,253,000 pounds. Thus, while the market
received a considerable portion of its total milk supply from adjacent
areas (9.3 percent), an even greater amount was shipped on a regular
basis by local producers to other milk marketing areas (21.4 percent).
Data on supply area locations, movement patterns and volumes are presented
in Table 31 and Figure 7.


Tampa Bay Area.--Milk processors in Tampa Bay received fluid milk
supplies from producers located in two other areas of Florida in addition
to local dairy farms. The total milk supply originating within the
eleven-county Tampa Bay area was 46,787,000 pounds in April and October.
This was 0.3 percent less than total plant receipts from all regular
supply sources. Of the total local production, 363,000 pounds were
shipped to Central Florida processors and 3,320,000 pounds were delivered
to plants in the Southeastern market. The county with the largest volume
of sales to area plants was Hillsborough. Fifty-seven percent of all
locally produced fluid milk originated on farms within that one county.

Producers in the Central Florida counties of Orange, Polk and
Sumter delivered 7.7 percent of total market receipts in the period
(Figure 8). Hendry County producers accounted for 213,000 pounds or
0.5 percent of milk supply. Thus, approximately 8.2 percent of market







-56-


Supplies in thousands of pounds.


Fig. 6.--Amount of Grade A milk by counties supplied by
producers to milk plants in Northeast Florida, April and October 1959.


i


*'*UIIII*LI(~lpl;Ulil~W*~yru^^-- I--- -~--r--.~.-u u~- r- -- -r ------


. MW~w^-irll*m,+ u*wiYl~rti.--&vr.Utl'-^.








-57-


Fig. 7.--Amount of Grade A milk by counties supplied by
producers to milk plants in Central Florida, April and October 1959.


__ __L1 ____~__I C__ _)___ ___~11__1____~~ ______I _~ ~~__








-58-


Fig. 8.--Amount of Grade A milk by counties supplied by
producers to milk plants in Tampa Bay area, April and October 1959.


Uw\UI ra*.-(liL(iuU1~(m L(IICL~LC-I~,TL~jl~r"rrYl~ai *nl~:iUlrrWWir;*r~UIlliUlll~i~Lllu~ IIU







-59-


receipts originated from farms in other markets and 7.9 percent of the
total area production was delivered to out-of-market processing plants.


Southeast Area,--Dairy farms regularly supplying Southeast Florida
dairy processing plants were located in two areas--Tampa Bay and Central
Florida--in addition to local area counties. Total market supply from
all producers for April and October 1959 amounted to 74,169,000 pounds,
the largest volume of any Florida area.

Local producer receipts originated in nine of the eleven counties
within the market (Figure 9 ). Total deliveries from these counties were
68,596,000 pounds. Palm Beach and Broward County farms accounted for
more than 48 million pounds--70.0 percent of receipts of local origin and
64.8 percent of total milk supply. The total two-month supply for the
market included 2,253,000 pounds from the Central area (3.0 percent) and
3,320,000 pounds from Tampa Bay farms (4.5 percent). Only 0.5 percent of
local production was shipped to other markets (0.3 and 0.2 percent,
respectively, to Tampa Bay and Central Florida).

In summary, four areas--Northwest, Central, Tampa Bay and South-
east--received over 90 percent of producer milk supplies from local pro-
ducers in the months of April and October 1959. All of the producer
supplies received at plants in the Northeast were from dairy farms located
in the area. In the Northeast and Central areas, local production of
milk was greater than total producer receipts at plants in the area. The
only market which received milk on a regular basis from producers outside
of Florida was the Northwest area. Producers in Alabama, shipping to
dairy plants in Pensacola, supplied 14.1 percent of the total Northwest
milk receipts in the period.


Fluid Milk Supplies Originating from
Out-of-State Sources, April
and October 1959

The only marketing area receiving supplies of milk on a regular
basis from out-of-state points of origin was the Northwest area. As
indicated earlier, producers in several counties in Southeast Alabama
held Florida permits and shipped milk to plants in Pensacola. For the
two months combined, deliveries from Alabama producers amounted to
2,922,100 pounds. Data from dairy firms showed receipts of emergency
fluid milk supplies from six states during the months of April and
October 1959, not including shipments from regular producer in Ala-
bama (Table 32).

Central Florida was the only market which received no supplies
from out-of-state sources in either month. The largest amount received
at plants in any milk marketing area was in Northwest Florida. Dairy
processors in that area received 554,200 pounds, or 42.3 percent of all
milk shipments originating in other states. This was also the only







-60-


Fig. 9.--Amount of Grade A milk by counties supplied by
producers to milk plants in Southeast Florida, April and October 1959.







-61-


TABLE 32.--Pounds of Fluid Milk Received from Outside of Florida by State


Origin and Amount of State
Marketing Areas


Supplies Received at Plants in Various


Amount of State Shipments Received at
Origin of Total Amount Plants in Various Marketing Areas
Supply of Shipments Tampa
supply of Shipments Northwest Northeast Central Tampa Southeast
Bay


Alabamaa 294,600 294,600 -- ---- ----- -----
Georgia 105,300 ----- 105,300 --- ----- -----
Illinois 582,320 259,600 -- ---- ----- 322,720
North Carolina 119,300 ----- 119,300 --- ----- -----
Tennessee 147,983 ----- ----- ---- ----- 147,983
Wisconsin 58,400 ----- ----- ---- 58,400 ----
Total 1,307,903 554,200 224,600 ---- 58,400 470,703


Source: Records of individual firms.

aDoes not include shipments of regular producers.


market to receive any out-of-state milk in April 1959. Milk plants in
Southeast Florida purchased 470,203 pounds from sources in Illinois and
Tennessee in October. Of the remainder, Northeast milk distributors re-
ceived 224,600 pounds and Tampa Bay firms 58,400 pounds, all in the month
of October.


Total Fluid Milk Supply

The total supply of fluid milk received in all milk marketing
areas was 196,570,000 pounds for April and October 1959. Receipts from
regular producers were 99.3 percent of the total supply (Table 33). For
all markets, local producer shipments were in excess of 90 percent of
total milk supplies received. The remainder in each area was obtained
mainly from sources located in other Florida markets. In Northwest Florida,
receipts from other states amounted to 2.6 percent of supplies. In no
other market was this amount above 1.0 percent of total receipts.


Prices Paid for Fluid Milk,
April and October 1959

Producer Milk.--Dairy farmers in all marketing areas were paid on







-62-


TABLE 33.--Amount of Fluid Milk Received from All Sources in Various Milk
Marketing Areas by Origin of Supply, April and October 1959

: Origin of Supply
Milk : Florida Production
Marketing Within : Other : Total : Out-of- Total
Area : Marketing : Marketing : Florida : State Supply
Milk
S Area : Areas Supply :

Total Supply of Milk (1,000 Pounds)

Northwest 20,382a 340 20,722 554 21,276
Northeast 29,586 --- 29,586 225 29,811
Central 21,625 2,213 23,838 --- 23,838
Tampa Bay 43,104 3,843 46,947 58 47,005
Southeast 68,596 5,573 74,169 471 74,640
Total 183,293 11,969 195,262 1,308 196,570

Percent of Total Supply

Northwest 95.8 1.6 97.4 2.6 100.0
Northeast 99.2 --- 99.2 0.8 100.0
Central 90.7 9.3 100.0 -- 100.0
Tampa Bay 91.7 8.2 99.9 0.1 100.0
Southeast 91.9 7.5 99.4 0.6 100.0
Average 93.2 6.1 99.3 0.7 100,0


Source: Records of individual firms.


aIncludes Alabama producers shipping on a regular basis
in Pensacola.


to plants


the basis of the value of final product form in which the pooled receipts51/
of all milk were sold to consumers. The products assigned to each use
classification varied according to the type of, or absence of, regulation
in each milk marketing area. In addition, the price designated for each
use classification varied in the same manner. It was possible to compare
average or blend prices received by milk producers supplying each Florida
milk marketing area. This blend price is an average price obtained by
weighting the different class prices by the volume of milk utilized in
each product classification.


51/ Receipts may be pooled on a market-wide basis or by individual
firms or cooperatives, depending upon the existence of and regulations
issued by regulatory agencies.







-63-


The average price varied between areas in a given month and be-
tween months in all areas (Table 34). The range in average price between
milk marketing areas in April was $6.60 to $6.69 per hundredweight. The
difference between October and April average prices was no greater with-
in any area than the variation between areas in a given month. The maxi-
mum difference between months occurred in Central Florida, where producer
blend price was $0.44 per hundredweight lower in April than in October.
In all marketing areas except Northwest Florida, blend prices were $0.25
to $0.44 per hundredweight higher in October than in April. This re-
flected a lower production and a higher proportion of supplies utilized
in higher value products in October.


TABLE 34.--Average Blend Price Received by Producer for Fluid Milk, by
Milk Marketing Areas, April and October 1959


Milk : Percent Butterfat : Price per Hundredweight
Marketing : :Blend price at : Average Blend Pricea
S:Ma : 4% butterfat
Area
: April :October :April : October: April : October


Northwest 4.00 4.06 $6.62 $6.60 $6.62 $6.63
Northeast 4.24 4.30 6.60 6.87 6.76 7.07
Central 4.40 4.15 6.60 7.04 6.86 7.14
Tampa Bay 3.97 3.96 6.69 6.96 6.71 6.99
Southeast 3.92 4.00 6.62b 6.87 6.62 6.87


Source: Schedules for individual plants for Northwest Marketing
area; Florida Milk Commission for Northeast, Central and Tampa Bay
Marketing areas; and Southeast Florida Milk Marketing Area Market Ad-
ministrator for Southeast Marketing areas.

aBlend price is a weighted average price for all milk sold by
producers and obtained by dividing total producer receipts by total
volume of milk.

bAs reported by the Market Administrator, no correction was given
for price adjustment from actual butterfat to a price on the basis of
4 percent milk.


Out-of State Milk.--Temporary grade A fluid milk supplies shipped
to Florida plants were obtained at widely varying prices per hundred-
weight (Table 35). In October 1959, milk was received from eleven
points of origin. F.O.B. origin prices ranged from $4.16 to $7.44 per
hundredweight. The lowest price milk was shipped from Atlanta, Georgia,
to Jacksonville. The highest price was for milk shipped from a point in










TABLE 35.--Origin of Out-of-State Milk Supplies and Florida Destination, F.O.B. and Delivered
Price, Shipping Distance and Shipping Charge, April and October 1959


: : : : Reported Price : :Shipping Charge
Origin of : Florida :Month Butter- : per Cwt. : Shipping : per Cwt.
Supply : Destination : ; fat : FO.B. delivered :Distance :To :Cents per
: : Percent : Origin : : : Mile


Alabama Pensacola April 4.0 $4.72 ---a 85 ---a
Alabama Pensacola October 4.1 5.33 --a 200 --a
Alabama Pensacola October 4.6 7.44 --a 85 ---a
Alabama Tallahassee October 4.0 ---a $5.18 350 --_a
Georgia Jacksonville October 3.8 4.16 4.79 325 $ .63 .19
Illinois Tallahassee October 3.6 4.67 6.57 940 1.90 .20
Illinois Miami October 4.0 4.98 7.48 1,400 2.50 .18
North Carolina Jacksonville October 3.9 4.44 4,99 400 .55 .14
North Carolina Jacksonville October 3.9 4.41 4.99 475 .58 .12
Tennessee Miami October 4.0 5.40 7.00 800 1,60 .20
Tennessee Miami October 4.0 5.57 7.00 790 1.43 .18
Wisconsin Tampa October 4.0 ---a 7.09 1,400 ---a


Source: Records of individual dairy firms.


aData not available.







-65-


Alabama 85 miles northwest of Pensacola, the Florida destination. Adjust-
ing both shipments to a 4.0 percent butterfat basis leaves a price spread
of nearly $3.00 per hundred pounds. The delivered price range for ship-
ments from eight shipping points for which complete data were available
was $4.79 to $7.48, or somewhat less than the range in the F.O.B. origin
price. Part of the differences in delivered prices was due to the vari-
ation in the distance between points of origin and Florida destination.
The lowest delivered price for out-of-state milk was from a source with
the lowest F.O.B. origin price, $4.16, and shortest hauling distance,
325 miles.

Shipping distances between points of origin and Florida markets
(destinations) varied from 85 to 1,400 miles. Shipping charges varied
considerably, ranging from 0.12 to 0.20 cent per hundredweight per mile.
On the basis of the few shipments for which information was obtained, it
was not possible to determine what prices might prevail for fluid milk
supplies and shipping charges from various distances if Florida dairy
firms were to rely more heavily upon these out-of-state sources. Further-
more, all prices reported were for emergency shipments only required be-
cause of seasonal patterns of production and utilization. It can be seen
from the data that, from five of the nine supply sources, milk was ob-
tained at delivered prices as much as $2.28 per hundredweight below the
average blend prices in some Florida markets during the period. However,
the prices may have been for supplies that were in surplus in these areas.
The F.O.B. origin prices did not necessarily reflect the prices paid to
producers for fluid milk utilization in their local markets.


Location, Volume and Distribution of Milk
Products Sold to Consumers,
April and October 1959


Location and Volume of Sales of Fluid Milk
Florida consumers purchased 196,653,000 pounds of fluid milk
products in April and October 1959 (Table 36). In order to rank by milk
marketing areas, sales volumes were: Southeast--73,472,000 pounds,
37.3 percent of total; Tampa Bay--46,206,000 pounds, 23.5 percent of
total; Central--31,227,000 pounds, 15.9 percent of total; Northeast--
25,393,000 pounds, 12.9 percent of total; and Northwest--20,355,000
pounds, 10.4 percent of total.

Dade County in the Southeast area ranked first, accounting for
sales of 42,409,000 pounds, or 21.6 percent of the total for the State.
Duval and Hillsborough counties ranked second and third in sales.
Volumes marketed were 18,815,000 pounds in Duval and 18,213,000 pounds
in Hillsborough County, or 9.7 and 9.2 percent, respectively, of the
State total. Sales in nine counties were less than 0.05 percent of all
marketing. Glades County in Southeast Florida was the only county in







-66-


TABLE 36.--Amount of Fluid Milk Products Sold by Processing and Distri-
buting Firms, Percent of Total Sales and County Rank in Area and
State, Milk Marketing Area, April and October 1959

Sa Amount of Fluid Milk Percent of Total in: Rank in:
Area and
andy Products Sold
County (1,000 Pounds) Area State Area State


Northwest
Escambia 8,632 42.4 4.4 1 7
Leon 2,476 12.2 1.3 2 15
Bay 2,158 10.6 1.1 3 18
Walton 2,119 10.4 1.1 4 19
Jackson 1.163 5.7 0.6 5 24
Okalooca 903 4.4 0.5 6 27
Gadsden 753 3.7 0.4 7 29
Santa Rosa 583 2.9 0.3 8 33
Taylor 224 1.1 0.1 9 43
Washington 224 1.1 0.1 9 43
Madison 221 1.1 0.1 10 44
Holmes 169 0.8 0.1 11 47
Dixie 151 0.7 0.1 12 50
Gulf 112 0.6 0.1 13 54
Jefferson 108 0.5 0.1 14 55
Franklin 103 0.5 ---a 15 56
Calhoun 92 0.5 ---a 16 58
Wakulla 82 0.4 -- a 17 59
Liberty 49 0.2 --a 18 61
Lafayette 33 0.2 ---a 19 63
Total 20,355 100.0 10.4 --- 5

Northeast
Duval 18,815 74.2 9.7 1 2
Alachua 2,242 8.8 1.1 2 16
Columbia 1,120 4.4 0.6 3 25
St. Johns 1,020 4.0 0.5 4 26
Putnam 687 2.7 0.3 5 31
Nassau 388 1.5 0.2 6 36
Levy 263 1.0 0.1 7 39
Suwannee 248 1.0 0.1 8 41
Bradford 154 0.6 0.1 9 49
Baker 149 0.6 0.1 10 51
Clay 136 0.5 0.1 11 52
Hamilton 102 0.4 --a 12 57
Union 45 0.2 --a 13 62
Gilchrist 24 0.1 --a 14 64
Total 25,393 100.0 12.9 --- 4







-67-


TABLE 36.--Continued


Amount of Fluid Milk Percent of Total in: Rank in:
Area and Products Sold
County (1,000 Pounds) Area State Area State


Central


Orange
Polk
Volusia
Lake
Marion
Seminole
Brevard
Osceola
Citrus
Sumter
Flagler
Total


Hillsborough
Pinellas
Manatee
Sarasota
Lee
Pasco
Charlotte
Highlands
Hardee
DeSoto
Hernando
Total


Dade
Broward
Palm Beach
Martin
Monroe
Indian River
St. Lucie
Okeechobee
Collier
Hendry
Glades
Total
Florida


12,302
6,146
4,387
2,036
2,011
1,802
1,695
264
232
217
135
31,227


18,213
15,414
3,570
3,467
2,871
792
545
529
366
254
185
46,206


42,409
14,824
7,640
4,006
2,224
753
731
672
157
56

73,472
196,653


39.5
19.7
14.1
6.5
6.4
5.8
5.4
0.8
0.7
0.7
0.4
100.0


Tampa Bay
39.5
33.4
7.7
7.5
6.2
1.7
1.2
1.1
0.8
0.5
0.4
100.0


Southeast


57.7
20.2
10.4
5.5
3.0


100.0


aLess than 0.05 percent.


6.4
3.1
2.2
1.0
1.0
0.9
0.9
0.1
0.1
0.1
0.1
15.9


9.2
7.8
1.8
1.8
1.5
0.4
0.3
0.3
0.2
0.1
0.1
23.5


1
2
3
4
5
6
7
8
9
10


21.6
7.5
3.9
2.0
1.1
0.4
0.4
0.3
0.1
a


37.3
100.0


1
5
8
11
17
29
30
32
48
60


- 1






-68-


which no sales were reported by commercial dairy firms. However, distri-
bution of sales was not obtained for independent producers. It seems
likely that the source of fluid milk products in Glades County was from
one or more firms of this type.


Amount and Source of Fluid Milk Products Sold (Consumed).--In this
analysis, it was assumed that sales by plants were synonymous with
consumption. As a rule, plants in each area sold the major proportion
of their volume within the market area in which they were located. How-
ever, in each area one or more plants sold products in market areas other
than the one in which they were located.


Northwest Area.--Total sales within the Northwest area by Florida
dairy firms were 20,355,000 for the two months (Table 37). Area firms
also marketed 677,700 pounds of fluid products in several near-by
counties in Southeastern Alabama making total sales 21,033,000 pounds.
Firms within the area accounted for 99.4 percent of the amount sold.
Northeast area dairy firms sold 124,000 pounds of products in Dixie and
Taylor counties. This was 0.6 of all marketing within the area.

The amount sold in Escambia County was 8,632,000 pounds (Figure 10).
This was the largest volume for any county in the area and was 42.4 per-
cent of total area sales. Sales in Leon, Bay and Walton counties
accounted for one-third (33.2 percent) of the volume distributed. In
nine of the twenty counties in the market, sales were less than 1.0 per-
cent of the total.

Local dairy firms sold 4.4 percent of their total volume outside
the market. Of this amount, 3.2 percent was in Alabama and 1.2 percent
in the Northeast Florida area. These data indicate that only relatively
minor amounts of processed fluid milk products were moved into or out
of the Northwest area during the period studied.


Northeast Area.--Total sales for April and October 1959 in the
area were 25,393,000 pounds. Of this volume, only 256,000 pounds
(1.0 percent of total) originated outside of Northeast Florida. These
sales were to consumers in two counties adjoining Northwest Florida, by
firms located in that area.

Total marketing of fluid milk products by local dairies were
30,979,000 pounds. The largest portion of sales was in Duval county
(Figure 11). Slightly under three-fourths (74.8 percent) of total sales
were in this one county. Dairy products processed in the Northeast
market were distributed throughout the fourteen county locality. Local
milk distributors accounted for 99.0 percent of within market sales in
addition to considerable amounts moved into other areas. Sales were
made in six of ten counties in Central Florida and two counties in





-69-


TABLE 37.--Amount of Fluid Milk Product Salesa of Plants Located in
Various Marketing Areas and Distribution of Area Plant Sales
in Various Marketing Areas, April and October 1959

Milk Total Amount of Area Plant Sales in:
Marketing
Area Sales Northwest Northeast Central Tampa Bay Southeast

Amount of Sales (1,000 Pounds)

Northwest 21,165 20,909b 256 -- -- --
Northeast 30,979 124 25,137 5,718 -- --
Central 23,862 ---- ---- 23,288 372 202
Tampa Bay 47,204 -- ---- 2,221 44,770 213
Southeast 74,121 ---- ---- ---- 064 73,057
Total 197,331 21,033 25,393 31,227 46,206 73,472

Percent of Area Plant Sales Sold in:

Northwest 100.0 98.8 1.2 ---- --- --
Northeast 100.0 0.4 81.1 18.5 --- ---
Central 100.0 ---- --- 97.6 1.6 0.8
Tampa Bay 100.0 --- ---- 4.7 94.8 0.5
Southeast 100.0 ---- ---- ---- 1.4 98.6

Percent of Sales in Each Area
Originating in Plants Located in:

Northwest ---- 99.4 1.0 --- ---- ---
Northeast ---- 0.6 99.0 18.3 ---- ----
Central ---- ---- --- 74.6 0.8 0.3
Tampa Bay ---- ---- ---- 7.1 96.9 0.3
Southeast ---- ---- ---- --- 2.3 99.4
Total ---- 100.0 100.0 100.0 100.0 100.0


Source: Records of individual firms.

aIncludes fresh whole milk, skim milk, buttermilk, chocolate milk
and drink and fluid cream.

bIncludes 677,700 pounds of fluid milk products sold in Alabama.


Northwest Florida. The volume sold in the Central market area was
18.5 percent of all sales by firms in Northeast Florida. Only 0.4 per-
cent moved into counties in Northwest Florida.






















N
Sales in thousands of pounds.


Fig. 10.--Amount and distribution by counties of fluid milk products sold by processing and
distributing firms located in Northwest Florida, April and October 1959.








-71-


Sales in thousands of pounds.



Fig, 1l.--Amount and distribution by counties of fluid milk
products sold by processing and distributing firms located in
Northeast Florida, April and October 1959.







-72-


The data showing movement of fluid milk products into and out of
the market are presented as a part of the summary in Table 37. It can
be seen from these data that while a considerable amount of product was
shipped to and sold in other markets, little was moved into Northeast
Florida by firms located in other areas.


Central Area.--Total sales of fluid milk products in the Central
area were 31,227,000 pounds in April and October 1959. Of this volume,
local firms supplied 74.6 percent. Sales by dairies located in the
Northeast area were 5,718,000 pounds or 18.3 percent of the total. An
additional 2,221,000 pounds (7.1 percent) of fluid milk products origi-
nated in the Tampa Bay area. The sales and movement of fluid milk pro-
ducts by Central Florida dairy plants and the origin of total sales in
the market are presented in Table 37. These data show that firms in
other markets sold about 25 percent of all milk products purchased by
area consumers, Furthermore, only about 2.4 percent of the volume of
products processed and distributed by local firms was moved into other
markets.

Central Florida dairy plants processed and distributed 23,862,000
pounds of fluid milk products in April and October 1959. In two counties
in Tampa Bay, sales amounted to 372,000 pounds or 1.6 percent; and
202,000 pounds or 0.8 percent were sold in four Southeast Florida
counties. The remainder, 97.6 percent, was marketed within the local
area. Orange County, the most heavily populated in the area, accounted
for 43.7 percent of all sales by local dairies. Consumers in two other
counties in the area, Polk and Volusia, purchased 17.5 percent and 12.5
percent respectively of total fluid milk products sold in the market by
local firms. The volume of fluid milk products distributed in each
county served by Central Florida fluid milk processing and distributing
firms is shown in Figure 12.


Tampa Bay Area.--The total volume of fluid milk products sold in
the Tampa Bay area in April and October 1959 was 46,206,00 pounds
(Table 37). As in most other markets, only a small percentage of total
sales of fluid milk products in the market originated with milk distri-
butors in other areas. Central Florida dairies marketed 372,000 pounds
or 0.8 percent of total consumer purchases. An additional amount,
1,064,000 pounds, or 2.3 percent of sales in the area, originated in
Southeast Florida. Volume sold within the market by local distributors
was 44,769,000 pounds. The largest amounts were distributed in two
counties--Hillsborough and Pinellas (Figure 13). The two counties ac-
counted for 75.1 percent of sales within the market and 72.9 percent of
the total volume of fluid milk products distributed in and out of the
market by local dairies.

Tampa Bay dairy firms distributed fluid milk products in all
counties within the market. Out-of-area sales by local firms were in







-73-
..fJ..rata. ft nqsar4ln~n fl~m~IU~fCtaA -6~


Also, Charlotte County -

rswirwa fMrt m- m" i uciwiiwtitamwirisM'i^ it~^ iiitt ja :-.


4,082 \




15
S58 \



90



248 39
I i


Fig. 12.--Amount and distribution by counties of fluid milk
products sold by processing and distributing firms located in Central
Florida, April and October 1959.








-74-


Il SWfl' S fl,.flS~*s s w i n ..aIt e -- u --r Y~() IT


15,414k kj



3,570 366 ,

\529
L 254
3,467 ,


297




1,807




157



Sales in thousands of pounds.


Fig. 13.--Amount and distribution by counties of fluid milk
products sold by processing and distributing firms in Tampa Bay,
April and October 1959.








-75-


two counties in Central Florida which accounted for 4.7 percent of total
sales, and two in Southeastern Florida which accounted for 0.5 percent
of sales.


Southeast Area.--The amounts of fluid milk products sold by pro-
cessors and distributors in Southeast Florida were the highest of any
market in the State in April and October 1959. Total sales were
73,472,000 pounds. Of this amount, local dairies accounted for
73,057,000 pounds, which was 99.4 percent of the total. The balance of
0.6 percent, 415,000 pounds, was marketed by firms located in the Tampa
Bay and Central areas (Table 37).

Local firms distributed in eight of eleven counties in the area
and one county in the Tampa Bay market (Figure 14). Total volume.of
products distributed was 74,121,000 pounds of which 98.6 percent was in
the local market, and the balance, 1.4 percent, in out-of-area markets.
Within the area, Dade County accounted for 57.7 percent of sales.
Combined sales in Dade, Broward and Palm Beach counties were 64,873,000
pounds, or 88.3 percent of total market consumption of fluid milk
products.


Amount and Source of Manufactured Milk Products Sold.--Dairy firms
handling fluid milk products also sold 7,470,000 pounds of non-fluid milk
products. These data do not include sales of non-fluid milk products in
the State by firms not handling fluid milk products. Therefore, total
sales within an area of all fluid milk firms, located in and out of the
market, cannot be considered as the total market consumption. Other
dairy firms specializing in the distribution of cottage chesse, sour
cream, yoghurt and ice cream operated in the market. No data were ob-
tained from these sources.52/


Northwest Area.--Sales of cottage cheese and ice cream, the
principal manufactured milk products handled by fluid milk distributors,
amounted to 367,000 pounds in Northwest Florida. Firms in the area also
sold 201,000 pounds in Alabama, or 34.7 percent of their total sales
volume. An additional 12,000 pounds, or 2.0 percent, was sold in the
Northeast market (Table 38).

No sales of manufactured milk products were made in the market by
fluid milk distributing firms in other Florida areas. Hence, the volume
of sales in each county given in Figure 15 equals the total sales by all
Florida milk distributors of these products. The greatest volume of


52/ Data were not obtained from such businesses because many of
these firms ship products from other states and frequently have their
headquarters outside of Florida.




































7,640


42,409


Fig. 14.--Amount and distribution by counties of fluid milk
products sold by processing and distributing firms in Southeast
Florida, April and October 1959.








-77-


TABLE 38.--Amount of Non-Fluid Milk Product Salesa of Plants Located in
Various Market Areas and Distribution of Area Plant Sales in
Market Areas, April and October 1959

Milk Amount of Area Plant Sales in:
Marketing Total -
Areas Sales Northwest Northeast Central Tampa Bay Southeast


Amojntrof.Sales (1,000 Pounds)


Northwest
Northeast
Central
Tampa Bay
Southeast
Total


580
1,762
510
1,652
2,966
7,470


568b





568


515
503
85

1,103


2
1,567
126
1,695


5

2,840
2,845


12
1,247




1,259


Percent of Area Plant Sales Sold in:


Northwest
Northeast
Central
Tampa Bay
Southeast


100.0
100.0
100.0
100.0
100.0


97.9


2.1
70.8
----


29.2
98.6
5.1


94.9
4.2


1.0

95.8


Percent of Sales in Each Area
Originating in Plants Located in:


100.0





100.0


1.0
99.0


46.7
45.6
7.7


100.0 100.0


0.1
92.5
7.4
100.0


Source: Records of individual firms.

aIncludes cottage cheese, ice cream and other non-fluid products.

Includes 201,000 pounds of non-fluid milk products sold in
Alabama.


sales within the local area was in Escambia County. Of the total amount
distributed in all areas served, 40.2 percent was in this one county.


Northwest
Northeast
Central
Tampa Bay
Southeast
Total


0.2
--w-
99.8
100.0






































Sales in thousands of pounds.


Fig. 15.-- Amount and distribution by counties of fluid milk products sold by processing and
distributing firms located in Northwest Florida, April and October 1959.







-79-


Northeast Area.--Total sales within Northeast Florida were
1,259,000 pounds of cottage cheese and ice cream (Table 38). Of this
amount, local firms accounted for 99.0 percent. The data show that only
minor amounts of product were sold in the local area by out-of-market
dairies. Of the total sales in the market, 1.0 percent originated in
Northwest Florida. The volume marketed by counties, by firms located in
Northeast Florida, is given in Figure 16. Slightly less than three-
fourths (74.9 percent) of sales within the area were in Duval County. It
can be observed from the sales area map that no sales were recorded in
four counties (each largely rural) within the local area.

Dairy firms located in Northeast Florida distributed a total of
1,762,000 pounds of manufactured milk products in the months for which
data were obtained. Within the area, local distributors marketed 70.8
percent of their total volume and the remainder, 29.2 percent, was sold
in Central Florida. Fewer counties in the Central Florida market were
served with manufactured products than with fluid milk products.


Central Area.--A larger portion of total sales of manufactured
milk products in Central Florida originated outside the area than was
true for any other Florida market. Total sales were 1,103,000 pounds;
local dairies marketed only 503,000 pounds in the area (Table 38). The
combined volume distributed by Northeast and Tampa Bay fluid milk pro-
ducts processors was 600,000 pounds. Volume of products sold in other
areas by Central Florida firms was also small--only 7,000 pounds or
1.4 percent of their total marketing for April and October 1959. The
sales by county for local dairies is given in Figure 17. In those
counties in which Northeast Florida firms as well as local firms oper-
ated, Northeast Florida firms sold more manufactured products than local
firms except in Orange County.


Tampa Bay Area.--The total amount of non-fluid milk products dis-
tributed in Tampa Bay by all Florida dairies operating in the area was
1,695,000 pounds for the two months. As shown by the data in Table 38,
local firms supplied 92.5 percent and out-of-area dairies the balance--
7.4 percent was from Southeast and 0.1 percent from Central Florida.
Total sales for all firms in the area slightly exceeded the volume dis-
tributed by Tampa Bay dairies in both local and other markets.

The combined volume of marketing by area firms in Pinellas and
Hillsborough counties was 79.8 percent of their total volume in all mar-
kets and 84.1 percent of local area sales. In Figure 18, the sales
volume of local firms is given by county in the period for which infor-
mation was obtained.

Dairy plants in the Tampa Bay area distributed a total volume of
1,652,000 pounds of manufactured dairy products in April and October 1959.







-80-


Fig. 16.--Amount and distribution by counties of fluid milk
products sold by processing,distributing firms located in Northeast
Florida, April and October 1959.








-81-


Also, Charlotte County 1


Fig. 17.--Amount and distribution by counties of fluid milk
products sold by processing and distributing firms located in Central
Florida, April and October 1959.


IIOL-LII~L.-~II.L__YIC~-~ --- --.~ .-- I- ___ -..--.I -







-82-


37










13






S29















Fig. 18.--Amount and distribution by counties of fluid milk
products sold by processing, distributing firms located in Tampa
Bay, April and October 1959.







-83-


Of this amount, 85,000 pounds or 5.1 percent were marketed in other areas.
These sales were in two adjacent counties in the Central Florida market.


Southeast Area.--As was found previously for fluid milk products,
sales of manufactured milk products in Southeast Florida exceeded any
other area by a considerable amount. Total sales by all firms operating
in the market were 2,845,000 pounds. Milk distributors within the area
marketed locally 2,840,000 pounds of cottage cheese and ice cream during
the two months. This was 95.8 percent of their total sales of these pro-
ducts in all areas and 99.8 percent of total sales of manufactured pro-
ducts by all Florida fluid milk distribution firms in Southeast Florida.
In summarizing the data on movement into and out of Southeast Florida in
Table 38, it is shown that sales in other markets by local firms exceeded
sales within the Southeast area originating outside the market.

The volume marketed in each county by Southeast Florida firms is
presented in Figure 19. As was true for fluid milk products, no manu-
factured items were sold by local dairies in the three counties west of
Lake Okeechobee--Collier, Glades and Hardee.


Fluid Milk Production-Consumption Balance in
Florida Markets, April and October 1959

Grade A fluid milk produced in Florida normally is used only for
fluid milk products. During periods of surplus of supply over consump-
tion of fluid milk products, some may be used in the manufacture of ice
cream and cottage cheese. These products normally are purchased in com-
pletely processed form or are processed locally using dairy ingredients
purchased out of the State,

There were seasonal patterns in both fluid milk production and
consumption in each milk marketing area of the State (Figure 20).53/
Similar patterns in production and consumption occurred in the Central,
Tampa Bay and Southeast milk marketing areas. High consumption months
were December through March; low consumption months were June, July and
August. Consumption rose rapidly from September through December. Pro-
duction generally lagged the change in consumption, both upward and down-
ward, by about one month. The monthly consumption-production pattern in
Northeast Florida bhre little resemblance to the other three areas.
Seasonal patterns were also more difficult to discern. In general,
changes in production and consumption were in similar directions, but
rather wide differences existed in most months.


53/ Data for 1959 production and consumption by month were not
available for Northwest Florida.






-84-


405


1,660


Fig. 19.--Amount and distribution by counties of fluid milk
products sold by processing, distributing firms located in Southeast
Florida, April and October 1959.






-85-


__ C'ass I sales
-- Producer
deliveries


1,15 -
li;5


100


95


J F M M J J:lS


\I.


ON D


JF M M JJA SON D


113 -

1i.:



100



95


90


85


I I I I I I


I I


I I I I 1


J F MA M J J S N '


J F M A M J J AS ON


Fig. 20.--Producer deliveries and Class I sales expressed as a
percent of monthly averages--selected Florida markets, 1959.

Source: Administrator, Florida Milk Commission, Tallahassee,
Florida, and Market Administrator, Southeastern Florida Milk Marketing
Order, Ft. LauderJale, Florida.


Percent


11iO


1"0F


I I I I I .-V .


I I # I


95 -


90-


85 -


I
'


I I


I A a 1


_~____I Y I ~ I__~__~_


.L' -t I I I i I I _


I I ~ 'L 1 I II 1


---






-86-


Amount of sales in each county in various marketingareas was added
to obtain the total consumption of fluid milk products in each market.
This was compared with amount of milk produced in the area to obtain a
production-consumption balance. These data are shown for the months of
October and April 1959 in Table 39. Fluid milk production exceeded the
total consumption of fluid milk products in two of the five milk market-
ing areas. In Northeast Florida, the net balance was 6,267,000 pounds
or 24.7 percent.-4/ In the Tampa Bay area production exceeded consumption
by 581,000 pounds or only 1.3 percent above the consumption of fluid milk
products.

The areas in which consumption fluid milk products was more than
production were Southeast, 6.2 percent; Northeast, 3.1 percent; and
Central Florida, 1.2 percent. For the State as a whole, consumption ex-
ceeded production of milk during April and October 1959 by 2,069,000
pounds or 1.0 percent. To the extent that the production of fluid milk
and consumption of fluid milk products in Florida in April and October
1959 wererepresentative of the average relationship, a net negative
balance should have existed for the year 1959. This is borne out by
data of the Dairy Division of the Florida State Department of Agri-
culture, which show that 46,353,000 pounds of fluid whole milk were im-
ported into the State during 1959.55/

















54/ A large positive net balance would be expected in the North-
east area between production of milk and consumption of fluid milk pro-
ducts. During April and October 1959, firms in the area moved 18.9 per-
cent of the volume processed into other market areas for distribution.
Local producers also shipped 6.6 percent of their production to pro-
cessing plants in other areas.

55/ Florida State Marketing Bureau, Annual Agricultural Statistical
Summary, 1959-60 Season (Jacksonville, Florida: Florida State Marketing
Bureau, November 1960) p. 167. Milk from regular producers in Alabama is
not included in their total.







-87-


TABLE 39.--Producer Supplies of Grade A Milk, Sales of Fluid Milk
Products (Consumption) and Production-Consumption Balance,
by Milk Marketing Areas, April and October 1959

Milk Producer Supplies Fluid Milk Production-Consumption
Marketing -of Product Salesa Balance
Area Grade A Milk (Consumption) Amount : Percent

LOo0 1.000 1,000
Pounds Pouuds Pounds

Northwest 20,382b 21,033c 651 3.1
Northeast 31,660 25,393 6,267 24.1
Central 27,508 31,227 -3,719 1.2
Tampa Bay 46,787 46,206 581 1.3
Southeast 68,925 73,472 -4,547 6.2
Florida 195,262 197,331d -2,069 1.0


aDoes not included cottage cheese, ice
milk products.


cream and other non-fluid


bIncludes 2,922,100 pounds from Alabama milk producers.

cIncludes 677,700 pounds sold in Alabama.

dThere is an indicated discrepancy of 0.3 percent (761,000 pounds)
between total supply received at all Florida plants, as given in Table 33,
and total consumption. Some of the buttermilk and chocolate drink sold
was made from nonfat dry milk powder purchased out-of-state, which would
in part explain the discrepancy. Reporting errors probably account for
most of the balance.














POTENTIAL DEMAND FOR FLUID MILK
IN FLORIDA MARKETS--1970


Economic theory ascribes the characteristics of demand for a
commodity to five basic determinants. Two relate to price and the
remaining three to population characteristics in a given market at a
given time. Price factors are: current prices of available substi-
tute goods and expectations of future price levels. The elements of
demand associated with population include: numbers, income and tastes
or preference patterns.

Ideally, demand projections would be based on a quantitative
measurement of the effect on demand for a commodity, in past and
present time periods, of each determinant. These values would then
be coupled with expected magnitudes of changes in each factor, over
a projected time period. The demand projection modeljS would then
approximate:

Dx = (P + Py + Pn + P+ Pt) where:
Dx = demand for good X,
Px = price of X,
Py = price of substitute goods,
Pn = population numbers,
P = per capital income, and
Pt = population tastes and preferences.

Results of past research dealing with price elasticity and cross-
elasticity of demand for the good would be employed to handle price
factors, i.e., increases or decreases in price of the commodity itself
and of substitute or complementary goods. Estimates of future population
numbers and income per capital would also be incorporated into the model.
This then would leave only the factor of changes in tastes and prefer-
ences to be measured and projected. For many classes of goods the vari-
ability in consumption preferences and tastes between buying units or
households and individual members of each unit would tend to confuse
any attempt to employ a single measure of taste and preference in a
predictive model.


56/ The model would provide an estimate of a point on the demand
schedule, not the schedule itself.


-88-







-89-


The difficulties involved in developing demand projections are
considerable. According to Fulmer,

There are three major problems, and numerous lesser problems,
in preparing economic projections. First, it is essential that
an orderly pattern in past behavior be isolated and meas-
ured if possible. Second, it is necessary to construct reason-
ably descriptive models third, application of the model or
models is dependent upon development of parameters which consti-
tute the model.57/

The need for projections of economic change over time is readily appar-
ent. However, as Kuznets has stated most concisely,

Empirical observation can relate to the past alone any
projection from the past into the future cannot possess
empirical validity in the way that a proposition having an
identifiable referrent in the past can. We cannot ask about
a statement concerning the future, "Is it true?" The
answer to this question no matter how strongly supported by
elaborate empirical study of the past, is merely a judgment
that cannot be fully tested, and is, in that sense, an act
of faith.58/

Thus, while proper procedures for making long-run, or at times even
short-term, economic plans generally require some form of projections
of the relevant factors, they must always be used with full recognition
of their inherent limitations. Further, their application in specific
situations shouldn't be made without reference to more recent or valid
sources of information.


Method Used in Projecting Fluid Milk Products
Consumption in Florida in 1970

In selecting a method of projecting consumption of fluid milk
products in Florida to 1970, past studies of the demand for fluid milk
were reviewed. It would appear that reliable quantitative measures of
various factors affecting the demand for milk products, other than


57/ John L. Fulmer, "Problems in Measuring and Projecting
Economic Growth," paper presented in graduate seminar on economic
growth, Department of Agricultural Economics, University of Florida,
Gainesville, Florida, April 14, 1961.

58/ Simon Kuznets, "Concepts and Assumptions in Long-Term Pro-
jections of National Product," Studies in Income and Wealth, Vol. 16
(Princeton University Press: National Bureau of Economic Research,
1954) p. 11.







-90-


populations, are not available in current literature. Development of
such measures was beyond the scope of their study. Hence, there appeared
to be little alternative other than projecting fluid milk products de-
mand as a function of population increase in Florida to 1970. This
method should give a satisfactory estimate if the statements of Mehren
and Daly are accepted that (1) per capital demand for food generally is
related to population at a ratio close to unity59/ and (2) per capital
requirements for dairy products should experience little change to
1975.60/ The model used for projecting demand for fluid milk products
in Florida in 1970 is stated below:

Dfmp ( t)(Cp ) where:
Dfmp demand for fluid milk products,
Pt = estimated Florida population in 1970, and
Cpe = consumption per capital of fluid milk products.

Fitting acceptable figures for population and consumption rates
to the equation gives an estimate of the total needs for fluid milk
products for the State as a whole. Since most dairy farmers and pro-
cessing and distributing firms produce and/or market their products in
a specific market area, it is also desirable to estimate the demand for
each market area. Separate estimates can be made for each area, the
sum of which equals the total demand projected for the State as a whole.
Using this method it is assumed that differences in present per capital
consumption rates in each area will remain constant. Also, the ratio of
population growth in each area will be the same from 1960 to 1970, as
from 1950 to 1960, if estimates of area population are not available.


Estimated Florida Population, 1970

The population of the State of Florida in 1970 has been estimated
by Webb61/ at 6,500:000 and by Arthur D. Little, Inc.62/ at 7,142,000.

59/ N. R. Collins and G. L. Mehren, "Demand Functions and
Prospects," Agricultural Adjustment Problems in A Growing Economy, ed.
E. 0. Heady, at. al. (Ames, Iowa: The Iowa State College Press, 1958)
p. 68.
60/ Rex Daly, "The Long-Run Demand Prospects for Farm Products,"
Agricultural Economics Research (Washington, D. C.: U. S. Department
of Agriculture) Vol. 8, No. 3, July 1956, pp. 73-91.
61/ John N. Webb, "The Prospect for Population Growth in Florida,
1960-1970," paper presented at the University of Florida-Rollins College
Seminar on Florida's Resources for Future Growth, Ft. Lauderdale, Florida,
December 8, 1960.
62/ Arthur D. Little, Inc., Review of Major Segments of the
Florida Economy (Cambridge, Massachusetts: April 1960) p, 4.







-91-


The Webb projection is based on a comparison of Florida with other states
that have grown mainly as a result of a large number of migrants annually
entering the State. Normally, there appears to be a cycle with a decade
of large growth in population followed by a decade of "rest and assimi-
lation" of the new residents into the economic, social and political
streams of the state. The fact that Florida has had two decades of in-
creasing rates of population indicates strongly that the decade 1960-1970
should be a period of somewhat slower increase in migration and hence in
total population growth. The Little projections assume that a smaller
decline in over-all growth will occur along with a "moderate shift" of
growth from the east coast to the west coast.63/

Based on the two projections of 1970 population, the estimated
population of each Florida market was determined (Table 40), Webb's
projection indicates an increase by 1970 of slightly over one and one-
half million persons. No estimates of area growth rates were given by
Webb. Therefore, the current ratio of area to total population was used
to allocate the increase in population among the five areas. On this
basis, Northwest Florida will have 785,000 residents, Northeast Florida
923,750, Central Florida 1,186,9.00, Tampa Bay 1,416,350 and Southeast
Florida 2,178,800.

The population projection of the Arthur D. Little, Inc. study
included estimates of the rate of growth by areas. The areas delineated
did not coincide exactly with the five milk marketing areas. It was
possible, however, to use them for allocating by markets the expected
increases in population. The Little population estimate for the State
was a total of 7,142,000 in 1970. Over one-third of this increase would
be in Southeast Florida, with lesser amounts in the other four areas.
If the projected rate of growth in each area is achieved, Northwest
Florida will have a population in 1970 of 721,342, Northeast Florida
942,700, Central Florida 1,457,000, Tampa Bay 1,578,400 and Southeast
Florida 2,442,600.


Estimated Per Capita Consumption
of Fluid Milk Products

Two recent studies of the demand for fluid milk have included
estimates of per capital consumption. The United States Department of
Agriculture household food consumption studies estimated per capital
consumption in the South in 1955 at 256.9 pounds.6i4 Purcell's


63/ Ibid., p. 4.

64/ United States Department of Agriculture, Food Consumption
in the South. Report No. 4. Washington, D. C.: Agricultural Research
Service and Agricultural Marketing Service, December 1956.














TABLE 40.--Total Population, 1960, and Estimated Population, 1970, by Market Areas

1970 Population
Milk 1960 Population
Marketing Webb Estimatea Little Estimate
Area Percent
Number of Number Increase Number Percent Increase
Total of Total


Northwest 598,336 12.1 785,200 186,864 721,300 10.1 122,964
Northeast 710,282 14.4 932,750 222,468 942,700 13.2 232,418
Central 904,111 18.3 1,186,900 282,789 1,457,000 20.4 552,889
Tampa Bay 1,079;030 21.7 1,416,350 337,320 1,578,400 22.1 499,370
Southeast 1,659,801 33.5 2,178,800 518,999 2,442,600 34.2 782,799

Florida 4,951,560 100.0 6,500,000 1,548,440 7,142,000 100.0 2,190,440


Source: U. S. Bureau of the Census, U. S. Census of Population: 1960, Number of Inhabitants,
Florida (Washington, D. C.: U. S. Government Printing Office, 1961) Final Report PC(1)-11A. Also,
John N. Webb, "The Prospects for Population Growth in Florida, 1960-1970," paper presented at the
University of Florida-Rollins College Seminar on Florida's Resources for Future Growth, Ft. Lauder-
dale, Florida, December 8, 1960, and Arthur D. Little, Inc., Review of Major Segments of the Florida
Economy (Cambridge, Massachusetts: April 1960) p. 4.

amusing 1960 ratio of area population to total in State as remaining constant to 1970.







-93-


estimate for Florida in 1955 was 234.38 pounds per capita.A5/ Both are
estimates of the weighted average per capital consumption based on the
rate for rural, non-farm, fatm and urban residents and the ratios to
total population of each segment. The rural rate of milk consumption
per capital is considerably higher than the urban and rural non-farm
rates. Therefore, the estimate of the United States Department of Agri-
culture and that of Purcell, with heavier weights applied to the rural
population than are applicable for Florida, are probably higher than the
actual fluid milk consumption rate per capital in Florida66/ in 1955.

From the utilization data presented earlier in this report, it
was possible to calculate :an estimate of total consumption of fluid
milk in all Florida markets in 1959. Expanding average daily sales
indicated a total consumption in 1959 of 1,184.0 million pounds of
fluid milk. This amount was divided by the 1960 total population for
Florida to obtain an estimated per capital consumption of 239.1 pounds
(Table 41). This figure is slightly above Purcell's 1955 estimate for
Florida of 234.4 pounds and slightly below the United States Department
of Agriculture estimate for the South of 256.9 pounds per capital.
Estimated per capital consumption for each market area was obtained by
dividing the estimated total consumption in the area by the area's
1960 population.


TABLE 41.--Estimated Total and Per Capita Consumption of Fluid Milk
in Florida, by Market Areas, 1959

Milk Total Estimated Annual
Marketing Consumption Population Per Capita
Area 1959 1960 Consumption

Thousand Pounds Number Pounds

Northwest 126,198 598,336 210.9
Northeast 152,358 710,282 214.5
Central 187,362 904,111 207.2
Tampa Bay 277,236 1,079,030 256.9
Southeast 440,832 1,659,801 265.6

Florida 1,183,986 4,951,560 239.1


65/ Purcell, J. C., Prospective Demand for Milk and Milk Products
in the South. Experiment, Georgia: Georgia Agricultural Experiment
Stations, SCS Series Bulletin 68, October, 1959.

66/ For example, Purcell's projected Florida population to 1975
included only 68.6 percent urban, while the 1960 census showed the
State's population was already 73.9 percent urban.







-94-


The estimated per capital consumption of 239.1 pounds could be
considered as in reasonably close agreement with the estimates of
Purcell and the United States Department of Agriculture. However, it
is subject to certain limitations. The method of obtaining the estimate,
i.e., using 1960 population and 1959 aggregate estimated consumption,
is not a precise way to allow for tourist consumption of fluid milk in
1959. The estimate of per capital consumption obtained by this method
was above Purcell's. This indicates that tourist consumption is prob-
ably over-compensated for by using 1960 population totals. Furthermore,
the variation in tourist numbers between markets is not accurately re-
flected in the use of 1960 resident population data. Milk consumed on
farms where produced was not included in the total consumption given
in Table 41. The months for which data were collected also may not have
perfectly reflected average per capital consumption of fluid milk.


Estimates of Potential Demand for Fluid Milk
in Florida Markets--1970

On the assumption of constant per capital consumption rates for
fluid milk from 1960 to 1970, the estimated total consumption (demand)
of fluid milk in Florida in 1970 will be 1,554.2 million pounds, using
the 6.5 million population estimate, or 1,707.7 million pounds if the
estimate of 7.142 million population is used (Table 42). In descending
order, the needs for fluid milk in 1970 will be greatest in Southeast
Florida, Tampa Bay area, Central Florida, Northeast Florida and North-
west Florida. The percentage increase in potential demand equals the
estimated percentage gain in market and state populations because of
the assumptions of unit relationship between population increase and
consumption and a constant rate of consumption per capital.

As was shown earlier, both total cow numbers and production per
cow have continually expanded as the amount of milk used in the State
has increased. Production per cow increased more than 50 percent be-
tween 1950 and 1960, and number of cows 43 percent. Nevertheless,
total production in Florida was slightly below market needs in 1959.
However, if dairymen should achieve an annual production of 9,000 pounds
of milk per cow in the next 10 years--which has already been reached in
several states--even the higher projected demand of 1,707.7 million
pounds could be produced with 5,000 less cows than the number in 1960.
To produce the lower demand for milk of 1,554.2 million pounds, only
173,000 cows would be needed if the rate of production per cow was
9,000 pounds. This would be 22,000 less cows than the number in 1960.

The technological base needed to obtain an increase in annual
output.to 9,000 pounds per cow already exists. This would be an increase
in production per cow of only 34 percent in the next 10 years, compared
to a 52 percent increase from 1950 to 1960. Thus, it seems likely that
little or no increase or some decline may occur in cow number between
1960 and 1970, provided farm production costs and fluid milk prices







-95-


remain near current levels.


TABLE 42.--Potential Demand for Fluid Milk in Florida Markets, Projected
to 1970, by Market Areas

Consump-
Milk 1970 Projected tion of Total 1970 Potential
Marketing Population Fluid Consump- Aggregate Demand
Area Milk per tion
Webb Little Capita 1959 Webb Little

Number Pounds Million Million Pounds
P--ounds
Northwest 785,200 721,300 210.9 126.2 165.6 152.1
Northeast 932,750 942,700 214.5 152,4 200.1 202.2
Central 1,186,900 1,457,000 207.2 187.4 245.9 301.4
Tampa Bay 1,416,350 1,578,400 256.9 277.2 363.9 404.6
Southeast 2,178,800 2,442,600 265.6 440.8 578.7 647.4
Florida 6,500,000 7,142,000 239.1 1,184.0 1,554.2 1,707.7


Source: John N. Webb, "The Prospects for Population Growth in
Florida, 1960-1970," paper presented at the University of Florida-Rollins
College Seminar on Florida's Resources for Future Growth, Ft. Lauderdale,
Florida, December 8, 1960. Also Arthur D. Little, Inc., Review of Major
Segments of the Florida Economy (Cambridge, Massachusetts: April 1960).


















SUMMARY AND CONCLUSIONS


For the past decade the dairy industry in Florida has been
experiencing continuous changes in economic conditions, population
characteristics of its market and in the technology of producing,
processing and distributing its products. The absence or lack of
adequate information has made it impossible to appraise the impact
of these changes or their effect on the economic well-being of the
industry. Future planning in the industry has proceeded, but with
a less adequate base than desirable.

The primary purposes of this study were to determine:
(1) the characteristics of Florida markets, (2) the location, volume,
marketing methods and movement patterns for fluid milk products from
producer to consumer, (3) the net balance of supplies and consumption
and (4) to evaluate the probable effects of factors associated with
fluid milk consumption and to estimate prospective demand for fluid
milk in Florida markets.

To accomplish the purposes of this study, the State was divided
into five milk marketing areas. Data on milk supply, movement and
utilization were collected for the months of April and October 1959.
These data showed source of supplies of milk by areas both for milk
produced in the State and inshipments of milk from other states. The
data also showed the number and location of processing plants, the
area of distribution for plants in each market and the volume and form
in which the products were delivered. Data for this study were obtained
from records of state and federal milk market control agencies and of
individual processing firms.

Previous studies and published statistics indicate that the
dairy industry has undergone important changes in the past thirty
years in the United States, in Florida and in other Southern states.
Market characteristics also have experienced profound changes. In-
creased population numbers, income and urbanization have all contri-
buted to changing market demand for dairy products. Taste and prefer-
ence patterns also have been recast within the past three decades. As
a result, consumption patterns for both fluid and manufactured dairy
products have shifted greatly.


-96-




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