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AKE GARFIELD CITRUS, COOPKIERATIt ia I:,* N
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MIMS CITRUS GROWERS ASSOCIATION *Si PA
* 'AK HILL CITRUS G*OWRS ASSOCIATION
OSLO CITRUS GROWERS ASSOCIATION & H@GAN IM
DIAMOND FRUIT COMPANY I'I eD RT ?:
IAN RIVER GROWERS SERVICE INC. AM
PLYMOUTH CITRUS GROWERS ASSOCIATION
-INDIAN RIVER PRODUCERS ASSOCW
IDE PACKING COMPANY, INC. LAKE i
PIlowRO Wtoes M*tC*fIta W
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SEALD-SWEET SALES. INC.
President and Chairman of the Board
C. G. Wilhoit, Vero Beach
J. C. Flake, Mims
G. B. Hurlburt, Mount Dora
Joe E. Keefe, Dundee
Ford W. Moody, Palm Harbor
John T. Lesley, Tampa
James Samson, Tampa
Counts Johnson, Tampa
E. F. Gudgen, Tampa
Luke C. Johnson, Tampa
R. G. Barr, Winter Garden
E. S. Beeland, Clearwater
Robert K. Cooper, Florence Villa
Joe P. Ellis, Bartow
R. W. Graves, Vero Beach
Ben Hill Griffin, Frostproof
O. J. Harvey, Tampa
E. S. Horton, Winter Haven
D. A. Hunt, Lake Wales
G. B. Hurlburt, Mount Dora
Armer C. Johnson, Mount Dora
Joe E. Keefe, Dundee
Ford W. Moody, Palm Harbor
Alfred A. McKethan, Brooksville
I. J. Pemberton, Jacksonville
John C. Updike, Lake Wales
C. G. Wilhoit, Vero Beach
H. H. Willis, Sr., Fort Pierce
John T. Lesley
Don M. Lins
General Sales Manager
Paul C. Sarrett
Howard N. Baron
Manager, International Division
The 1962-63 season has been, without doubt, unique among a series of
unusual seasons of the past two decades. Records seem to indicate that the
season we are just now completing has had no parallel in recent history, or
for that matter, in the citrus history of this century.
Actually, the 1962-63 season has been more like two seasons. The first
season beginning in September and ending in mid-December, and the sec-
ond season beginning with the December freeze and ending with our final
shipments in June.
Early crop estimates predicted the largest citrus crop in Florida history.
Carryover of canned products was at a record level, and the industry in
general was bracing for the marketing problems that were sure to follow.
While the industry in general was reconciled to the low price levels
that could be expected under the circumstances, there seemed to be no
despair or despondency over the situation.
Fresh fruit shippers throughout the state initiated an all out promotional
campaign through the Florida Fresh Citrus Shippers Association scheduling
national programs on specified dates for both oranges and grapefruit.
It was our feeling that most of the major trade factors were prepared to
support this promotional program, and would promote the various varieties
as they reached the peak of volume.
This was the earliest and most complete plan for fresh fruit promotion
ever formulated in the Florida citrus industry. It was designed to help
accomplish the greatest sales effort ever undertaken by the industry, and
it was to be sustained throughout the season.
All of this changed overnight of course, because of the devastating
damage to all varieties from the December freezes. Promotions were can-
celled as the emphasis shifted to the major task of spreading the available
top quality fruit to our many customers. The policy of the Florida Citrus
Exchange was to concern ourselves with the requirements of our regular
customers as best we could, while maintaining some distribution of our
brands to all markets customarily served by this organization. While this
was a difficult accomplishment, our volume records by market and cus-
tomer seem to indicate that we were successful in this endeavor.
Our grapefruit sales for the season have been rather astonishing. Al-
though we faced a stiffly competitive market before the freeze, our de-
mand and price level was reasonably good. Since December we have had
a constantly rising price level, and demand continued high. Our total ship-
ments for the season were down only about 7 percent below last season.
This was due to our substantial volume of grapefruit from the southern
portion of the interior, and the outstanding quality and high volume from
the Indian River section. The Indian River section shipped over two-thirds of
the state's total grapefruit volume following the freeze, and it is expected
that the Exchange's total volume of grapefruit for the season will amount
to about one-third of the state's total.
Orange prices were low prior to the freeze, although prices had
stabilized somewhat by the Christmas holiday season. Prices jumped rapidly,
of course, i "''' mnc. the freeze. All time highs were established early in May.
We -xDeo'nrered fair demand at the six dollar level As a practical mariF
or;c.> were reached that made fresh oranges virtually out of the reach of
Our hand eating varieties sold for all time record prices, and, surpris-
ingly, we marketed three-fourths as many boxes of tangerines, Temples,
tangelos, and Murcotts as were marketed last year.
One interesting and rather gratifying aspect of the 62-63 season is that
our total shipments exceeded shipments of the 1957-58 season while most
authorities agree that this season's freeze was considerably more severe
and more devastating than the freeze of five years ago. While the Ex-
change will ship more than it did in 1957-58, the state as a whole shows
a sizeable decrease.
There can be no doubt that the 1963-64 season will present many sales
problems, many of which are already manifest as we prepare for the new
season. We feel confident, however, that our percentage of the state's total
movement of fresh fruit will increase.
Through aggressive marketing, we are optimistic that a large volume
of all varieties will move in fresh form. We believe our combination of
facilities, including prepackaging, export, merchandising, and our own
representatives in major markets will provide a sound basis for the success-
ful marketing of a considerable volume of fresh fruit.
And, while we gear our sales program to accommodate the presently
reduced volume of fruit available to us, we cannot be unmindful of the
inevitable return to normal in future seasons. Thus, it is our hope to keep
abreast of changes at the trade level, of innovations in marketing, new
marketing techniques, and most certainly the rate of our return to normal
The 1962-63 season for exports, like the domestic market, was expected
to produce record shipments of fresh fruit. We began exporting around ihe
middle of September and had developed considerable momentum by De-
cember 12th when the freeze struck the industry.
At the time of the freeze, our exports had reached 431,000 cartons of
fresh citrus as compared to 160,000 cartons at the same time during the
previous season; an increase of more than 150%.
Obviously, our exports were substantially curtailed following the freeze
because of both the limited availability of fruit and the higher prices of
that which was available.
Our Indian River exports of grapefruit to Europe were increased this
season despite the price structure, and "FLORIGOLD" has become quite
well established in France as a premium high-quality fruit.
Exports of fresh citrus were discontinued in April as a result of the
severe drought throughout the citrus belt which quickened break-down and
adversely affected quality of fruit arriving on the European market after
the long voyage from Florida. By our discontinuance, we gained the two-
fold advantage of avoiding excessive claims as well as the advantage of
concluding shipments while quality was excellent; this will be remembered
by our trade in the years to come.
We have continued to export considerable tangerine concentrate, and
our exports of frozen concentrate and single strength juices have main-
tained their normal volume. The net effect of the freeze, however, will be a
rather sharp decline in the level of sales we could have expected had the
freeze not occurred.
Our basic problem for the present is to continue to export where pos-
sible, to keep our brands before the trade, and to maintain good relations
with customers we have developed over the years. All of these things will
be of great value to us when our production returns to normal.
The Florida Citrus Exchange has continued its promotional programs
throughout the season. This organization continues to maintain the only
comprehensive brand merchandising program among fresh fruit shippers
in the industry, a plus factor that has established high prestige for us
among our customers.
While the advertising program for Seald-Sweet products was sharply
curtailed following the freeze, our Indian River shippers continued their
schedule of advertising throughout the season. Merchandising personnel
was, of course, detailed to areas of greatest distribution.
Our major problem has been the need to reconcile the obvious need
for strictest economy with the equally obvious need to maintain our mer-
chandising program in expectation of our return to high productivity. Our
dealer-service personnel were utilized more often than not as contact men
in a sort of public relations program designed to assure our customers that
our organization contemplated no change in our basic service philosophy
ryu.-dr :,.. of the scarcity of fruit.
We have endeavored to economize by restricting considerable over-the-
road expense normally encountered by our dealer service representatives
in the process of covering our vast area of distribution. This became pos-
sible as supplies of fruit were reduced and the necessity for long trips was
decreased. At the same time, our dealer-service program was focused so
as to provide peak service at the high volume points.
There can be little doubt that the need for dealer-service representation
will be vital during our return to normal production. We believe our point
of purchase materials, our advertising where indicated, and our dealer-
service program represent the industry's most comprehensive fresh brand
product recognition of the needs of the trade. We are certain that our
efforts of this critical past season will be of importance as our volume
builds, and that our trade image has been greatly enhanced.
Although the circumstances surrounding the 1962-63 season were such
that publicity "breaks" were to a great extent inadvisable, our Industrial
Relations Department has continued to maintain good relations with both
the press and broadcast media at the industry level.
We have enjoyed favorable coverage and '.n.uge throughout the
season, and have again been able to our story to both our membership
and the public at large when such a course has been indicated.
It seems certain that as the citrus industry readjusts to the post-freeze
era, there will be further realignment of fresh fruit sales agencies, par-
ticularly in the interior part of the state. As this occurs, our pporlt:.-.ii" to
secure additional tonnage increases in an almost direct proportion to our
ability to convince prospective shippers that the Florida Citrus Exchange is
the state's most effective sales organization.
Much of the responsibility for establishing this conviction among fresh
fruit shippers rests with the factual presentation of our day to day accom-
plishments through the informational -Erioa of the state. This, in our opinion,
can best be accomplished by the long range program we have had under
way for the past several years.
We continue to feel that the size and c:.mn.'.-xi.i of the citrus industry
today is such that our continued ...,,d relations with state officials, the
legislature, the press, and the -,jllk.l in general is directly related to the
protection of our interests within the broad scope of the citrus industry.
For the five years ending August 31, 1962, the gross sales of this or-
ganization totaled $133,685,000.00. During the same period we have
charged off as .-- -Illctable accounts only 35 and one-half thousandths of
one percent of this amount. This favorable position is indicative of excellent
supervision on customer credits without imposition of unmanageable sales
restrictions. This procedure forms an extremely important part of the
Exchange system of -
Our c.. .E ... .and .' .. for the 962*. season were approxi-
.icic-l. 1 iC.,. "> Despite the j. de of this responsibility, and
the exactness with which it must be performed, c.- -:.ic.n!. were processed
and returns were forwarded to our .' ..cr members within twenty-four
hours after receipt.
Our ',::c.:u :- '.. invoices and collects from a wide range
of more than '.i :. accounts located in the United States, Canada,
and several r --.. countries, pays all brokerage and many transporta-
tion charges, and performs a score of .:.;,lonoi services for all depart-
ments requiring c~.. 'jniir.i. and ;, ,-. control.
-ie increasing volume of .'. ." required for tax purposes, as well
as the high degree of >kiin and knowledge involved in the handling of large
sums of -,-cri.-v, most certainly cal for both confidence and experience.
The FicrI- Citrus .r.ohnge is, in our ::nior. in u.'.-n, position in
The 1962-63 season opened on a general feeling of optimism for a
banner year in transportation. However, unexpected events such as the
freeze, railroad strike, and consistent truck shortages combined to present
an unusual number of perplexing problems before the season was com-
As the season began the Atlanic Coast Line and Seaboard Air Line
Railroads had announced the -- .: -: of special tri-weekly piggy-
back trains to the East and, ado the A' .. had announced plans to
provide special piggy-back train service to Chicago and the Middlewest.
It was anticipated that piggy-back service would be expanded with the
,raiirL.3J pori:cioD',n.: in the fresh fruit ,'.. :,rooig the use of motor
trucks on a more l;conalt basis than in several previous seasons.
Of course, the picture changed :a::; as a result of the freeze. The
railroads imme .-:-: irncelt-i the special ):ggy-bockl train schedules,
causing the industry to rely completely on normal perishable schedules.
To compound an already difc.'1 situation, the non-operating em-
ployees of the Florida East Coast 9i-.- n,, which serves the Indian River
area, called a strike on January 23, 1963 which continued in effect until
the close of the season. Whereas, just prior to the freeze the industry had
feared a truck shortage during the peak Christmas *;,-.,.. :..- a
surplus of trucks prevailed immediately following the freeze. This proved
advantageous to Indian River shippers, however, who were forced because of
the rail strike to rely on motor transportation to move much of their volume.
The ACL and SAL Railroads came to rescue of Indian River shippers by
providing trailers from and to ramps on their lines at the same rates appli-
cable from FEC points. This allowed the two companies an opportunity to
retain traffic which they ordinarily received from the FEC at Jacksonville.
It is our opinion that this action aided substantially in preventing an
acute truck shortage which could have been disastrous to shippers by
causing high rate levels.
Notwithstanding the inconvenience and additional expense to the Indian
River shippers because of the unavailability of normal rail service, all ship-
ments were made in an expeditious manner with no disastrous effects.
Both the Atlantic Coast Line and the Seaboard Airline railroads are to be
commended for their prompt action in serving the industry during the period
of acute emergency. Likewise, we should pay tribute too, to the tremendous
role the trucking industry played during this emergency.
Our Traffic Department was largely responsible for prevailing upon the
three Florida rail carriers to remove the Ex-Parte increases on fresh citrus
fruit exported through the port of Jacksonville. This action resulted in con-
siderable savings on several shiploads of fruit exported this season.
Likewise, we were instrumental in the establishment by rail carriers of
uniform billing weights on four-fifths bushel capacity containers with 1700-
to 1900-cubic-inch capacity.
We have continued to encourage the railroads to reduce rates on citrus
fruit in conventional refrigerator cars. We have sought this reduction in
an effort to induce greater utilization of much of this equipment which
normally is idle. At this time an application has been submitted and ap-
proved by all Southern lines for a 10 percent reduction in rates from Florida
to many destinations. This proposal is now awaiting action by other partici-
pating carriers and appropriate rate authorities.
The Traffic Department processed 1,206 rail and truck claims prior to
May 25, 1963, and collections at that time amounted to $55,029.86.
These figures will be considerably increased when the concluding months'
activities are reflected.
Railroad mergers and rail legislation will continue to be much in the
national picture. Many changes in the transportation industry will no doubt
take place as technological improvements are advanced and implemented.
It is our intention to assure that we remain alert to these changes, and to act
at every opportunity to protect the interest of the fresh fruit shipper.
Section 17 of the Revenue Act of 1962 dealing with tax treatment of
cooperatives and their patrons has necessarl claimed much time and
effort of our Legal Department this season.
This revenue measure makes mandatory the payment of a single tax
either by the cooperative itself or by the patrons themselves, pursuant to
their appropriate consent, on net earnings of the cooperative.
As usual, the Legal Department spent much time and effort in coopera-
tion with all other interests in the citrus industry in evolving the very broad
legislative package of the industry for presentation to the 1963 session of
the Florida Legislature.
Many matters involving the Perishable Agricultural Commodities Act
and the Robinson-Patman Act continued to claim much of the time and
attention of the Department throughout the season.
The 1962-63 season began under the formidable pressure of the largest
crop ever forecast for Florida, 120,500,000 boxes of oranges and 38,000,-
000 boxes of grapefruit. The industry was in general agreement that
profitable disposition of a crop of this proportion would require the utiliza-
tion of every channel of distribution to the fullest degree.
In order to assure maximum fresh utilization, the Florida Fresh Citrus
Shippers Association instigated a series of promotions designed to move
20,000,000 boxes of oranges and 20,000,000 boxes of grapefruit in fresh
channels. The so-called 20/20 promotion, supported by the Florida Citrus
Commission, was well on schedule when the freeze of December 12th and
13th interrupted shipments midway in the Christmas shipping period.
The industry's problems of the immediate post-freeze period have been
well documented. So far as the Florida Citrus Exchange is concerned, we
experienced an abundance of problems during the period between the
freeze and the embargo, but we came through this trying situation to the
benefit of both our shippers and our customers.
After resumption following the embargo, our operation had changed
from one of ample supply to one of potential shortage. During this time,
the Exchange was among the industry leaders in establishing fresh fruit
prices parallel to prices paid by canners for comparable fruit even when
they could average it with distressed fruit stocks.
Because of the freeze, we were forced to change our whole marketing
attitude. Instead of volume we now placed major emphasis on price. That
this transition was successfully undertaken is indicated by the number of
packing houses we were able to continue in fresh fruit shipment.
Most experienced estimates generally agree that it will be a number of
years before we return to the high volume position which confronted us at
the beginning of the 1962-63 season. Our major problem now is to main-
IN SUMMARY (CONTINUED)
tain distribution. If we fail to do this, we will jeopardize our marketing
position to competitive items, and it may be extremely difficult and expen-
sive to recapture this lost market.
Competitive items such as other fruit juices, ades and synthetics will
aggressively attempt to displace our citrus juices in the consumers' diet,
and we must just as aggressively resist. To do this we must undertake to
convince the consumer that citrus is still a "best buy" for both health and
I believe this interim would be a good time to test market new consumer
approaches, both in advertising and merchandising, to measure the effec-
tiveness of different media. In short, this period of light supply and high
prices should be used to do many of those things which had obviously
been left undone as we made plans to handle our record breaking crop
at the beginning of the 1962-63 season. We have a short breathing spell
and we should use it to our advantage to gain more and better marketing
The Florida Citrus Exchange is in a relatively excellent condition both
as to personnel and supplies as we look to next season. We certainly shall
not ship as much fruit as we would like, but we will have sufficient volume
to enable us to operate at a very competitive selling cost. With one new
member already signed, we are hopeful of securing additional members
prior to the beginning of the new shipping season.
More and more it becomes apparent that the Exchange's system of
marketing, based on 52 years of experience, provides for its membership
the most comprehensive and effective method of sales available to the fresh
fruit shipper in Florida. In times of short supply, as in years of abundance,
the Florida Citrus Exchange has built into its organization those factors
which consistently place its membership at an advantage over other
shippers. There is no doubt that the 1963-64 season will bring its own good
share of problems and difficulty, but past performance would seem to
indicate that the Exchange shipper can face each succeeding season with
the added confidence that only a half century of experience can provide.
FLORIDA CITRUS EXCHANGE
FRANKLIN AT OAK
Litho U 5 A