Division of Agricultural Sciences UNIVERSITY OF CALIFORNIA LONG-HAUL TRUCK TRANSPORTATION OF CALIFORNIA FRESH FRUITS AND VEGETABLES Guy Black CALIFORNIA AGRICULTURAL EXPERIMENT STATION GIANNINI FOUNDATION OF AGRICULTURAL ECONOMICS Mimeographed Report No. 174 ISO? \ February 1955 i SUMMARY There is an ever-changing nationwide market for California fresh fruits and vegetables, and part of the problem of marketing this produce is transporting it to market. The problem is the annual movement to market of about 1*20,000 car- loads a year. Of this, 210,000 must be moved to points east of the Mississippi; and 100,000 must be distributed within the state of California, There is a well- developed transportation system available to accomplish this task. It is, how- ever, a constantly changing system, and agricultural marketers must be alert to its changes as well as to the changing market for their produce. Some considerations are especially important in fresh fruit and vegetable transportation. It must be rapid enough to preserve the essential freshness of the produce and to minimize the risk of price change while the produce is in transit. Because fresh produce has a relatively low value per pound, the cost of movement per pound must be relatively low. Transportation companies must ad- just to meet a highly seasonal and quite irregular demand. More and more, the transportation of produce is by motor truck. Short-haul movement was taken over by trucking many years ago, but today the longer hauls are more and mere frequently accomplished by trucks. This long-haul trucking is, curiously, performed for the most part not by the large common carriers whose names are landmarks on the highways but by small owner-operators or by small fleets. Such operators have concentrated on hauling of agricultural commodities because their transportation is exempt from many of the licensing and certifica- tion requirements which the law requires common and contract carriers of general commodities to meet. Just the cost of getting permits often are beyond the means of truckers with limited economic resources. The truckers who concentrate on hauling agricultural products in many re- spects are a separate transportation industry. As a group they, and the agencies associated with them, have much of the unsettled organisation characteristic of a new industry because competition has not had time to organize them into an ef- ficient pattern. Many details of inefficient organization can be seen. The disorganized market for transportation by truck is one of the most im- portant sources of inefficiency in the truck transportation of fresh fruits and vegetables. This market is important because free entry, rate bargaining, and rapid shifting of equipment from one route to another are all made possible by exemption from most ICC regulations. Where regulatory agencies do not interfere, these kinds of adjustments which take place in a well-organized market help ii develop an efficient industry organization* However, this result depends on a market throughout which there can be free and ready interchange of information between shippers and true 'cars. Such a market has not developed in the agricul- tural commodities trucking industry. Its absence means that truckers and ship- pers must spend an inordinate amount of time and energy locating traffic or trucks and bargaining on rates. Frequently, they do not find the "right" ship- per or trucker. To a limited extent, truck brokers have served as coordinating middlemen, but they have achieved only a limited development and have not been altogether satisfactory. Also, their rates are very high. Whether fresh fruits and vegetables should be shipped by truck or by rail is a problem for both the shippers and the makers of transportation policy. In general, trucks are cheaper for short hauls, and railroads are cheaper for long hauls. The choice is complicated by the fact that, while railroad rates are fixed, being regulated by the ICG, truckers are free to change whatever rates they xjill. Truckers undercut rail rates when traffic is scarce and charge what the market will bear when transportation equipment is scarce. Also, trucks have advantages of extra speed, flexibility, and gentleness of ride which sometimes are so important that they can charge even more than rail rates. Dealing with railroads may have certain advantages to shippers also. Of the shippers of fresh fruits and vegetables who have been using trucks, many would prefer to rely primarily upon the railroads. It costs them money to reorganize their plants and shipping platforms for truck use; the prompt loading and unloading, upon which shippers insist, is frequently very irritating and inconvenient. Relying on small, unknown, and underfinanced truckers has some hazards which shippers would like to avoid and against which they are unable to protect themselves adequately by insurance or any other means. Trucking has a job to do and can do it better than it is being done at this time. Research on many quite simple difficulties may lead to better efficiency. Anything which helps the market for truck transportation do a better job of co- ordinating supp]y and demand for truck services will help trucking do a more ef- ficient job. Shippers and truckers can do a better job if they are guided by a program of training and education. For example, truckers should be made to realize that such irresponsible behavior as failing to keep appointments — at present all too common — can be very costly to shippers and may lead them to avoid using trucks whenever possible. iii Better systems of insurance should not be overlooked. Credit-rating bu- reaus can be invaluable. Brokers could improve coordination and might find the organization of a truck transportation exchange invaluable, even though it would entail a substantial reorganization of the way brokerage is conducted. The mar- ket news services might consider disseminating information on trucking as well as on fresh fruits and vegetables. Producers' concentration markets have been valuable in connection with trucking in the East and particularly in the South- east, and such markets may be a logical next development in California. The impact of trucking on fresh fruit and vegetable marketing has been wide and deep. The industry cannot accept a new system of transportation and leave everything else as before. A change in transportation means new competition in produce marketing because trucking means advantages for new firms, new ways of doing business, and new geographic areas. Today, there is a revolution in prod- uce marketing under way, the outcome of which cannot yet be seen; trucking has played its part in getting this revolution under way. There are many unsettled issues of public transportation policy whose fu- ture course has significance for efficiency of agricultural truck transportation. The special position of unprocessed agricultural commodities in the Motor Car- rier Act, 1935, has had the broadest possible significance in the organization of agricultural transportation and, indeed, has seriously affected railroads and nonagricultural truck transportation. While the exemption is a long-established part of governmental transportation policy, it is still under regular attack from railroad and nonagricultural trucking interests. In recent years, the ICC has tried s by a proposed new regulation on trip D.easing, to isolate the agricultural haulers from the remainder of the trucking industry. Agricultural shippers have been seriously concerned over the impact of the proposed regulation on costs of their transportation. There is a conflict in policy and economic interest at the root of the trip-lease controversy which can be resolved only by reference to the broadest phases of economic policy. iv TABLE OF CONTENTS Chapter Page SUMMARY i I The Reasons for This Study 1 The Changing Transportation Picture 2 II Produce Industry Transportation Requirements . f? Areas to Which It Must Be Moved .......... $ Seasonality of Movement ......... 7 Coordination of Transportation as Part of the Nationwide Produce Marketing System ... .......... 7 Cost of Transportation .... ..... 9 Speed Requirements ». 10 Perishability as a Problem in Produce Transportation .... 10 Other Requirements .......... 11 Refrigeration Equipment ....... ....... 12 Heat Removal Requirements of Various Loads 13 Calculating Refrigeration Requirements Jli Temperature Ranges ••• lU Precooling , ....... 17 III Functional Description of Truck Transportation of Fresh Fruits and Vegetables .... ....... 18 Equipment Used 18 Associated Facilities . ..... 19 Mechanics of Truck Movement ................. 20 Mixed Loads Popular 2$ What Produce Truckers Are Like 25 The Market for Truck Transportation of Produce ....... 27 IV Public Regulation and Truck Transportation of Fresh Fruits and Vegetables ......... .. 30 How It Came About 30 Regulation as a Barrier to Interstate Commerce ....... 30 Classification of Motor Carriers ......... 32 The Exempt Interstate Carriers 33 Exempt Commodities . ........ 33 Consequences of the Exemption 3I4. V Chapter p age V The Trip-Lease Controversy . , , 36 Economics of Exempt Trucking 36 Ex Parte No. MCU3 37 Why the ICC Is Concerned . . t 38 Effect of ICC Proposal on Produce Marketing 39 Effect on the Structure of the Trucking Industry Ill VI Why Trucks Are Used Instead of Railroads ^2 What Users Said . U2 Trucking Is Most Effective in Smaller Markets . U3 Still Room for Improvement k3 Transit Time , , ifo Rates ■ ». \x$ Determining Truck Rates a Problem •••••« U8 Comparing Truck and Rail ••• 50 Other Factors ...... Q ........ . 5l Why Financial Responsibility Is a Problem ..... 5l Brokers 1 Insurance Arrangements 52 VII Trucking Can Be More Useful 55 Transportation Efficiency .................. 55 How Brokers Have Helped , ., 57 Can Brokerage Be Improved? . » ........ 59 Other Means of Coordinating , 60 Market News Coverage of Trucking , 6l Better Insurance . . ....... 62 Risk Reduction by Other Means ................ 62 Government Regulation and Marketing Efficiency ....... 63 VIII Better Ways of Assembling Loads for Truck Transportation ... 65 What Concentration Markets Can Do ....... 65 Where a California Concentration Market Might Be Located . « 67 The Wat sonvi lie -Salinas Area Possible ••• 67 The Stockton Area ...................... 69 Farther South , 69 Markets in Metropolitan Areas ■ c . . « 69 What Would Be Gained by a New Concentration Market? ..... 72 Who Might Develop a California Concentration Market ..... 73 vi Chapter Page IX Trucking Hakes Marketing Dynamic 7J1 Competition in Transportation 7I1 The Transition in Produce Marketing 76 Ultimate Objectives ....... 78 List of Figures Figure 1 Estimated Unloads of California Fresh Fruits and Vegetables by Regions in Car lot Equivalents, 1951 6 2 Carload Shipments of California Fresh Fruits and Vegetables by Crop Reporting Districts, Monthly, 1951 (thousands of carloads) 8 3 Approximate Rate of Evolution of Heat by Certain Fresh Fruits and Vegetables When Stored at the Temperatures Indicated . ..... 1$ h Outbound Truck Passings of Fresh Fruits and Vegetables Through California Border Stations in Carload Equivalents, 1951, 1952, and 1953 21 5 Percentage Distribution of California Fruits and Vegetables Transported Out of California by Truck, by Border Stations, 1950 . 23 6 Typical Movement of Motor Vehicles Carrying California Fresh Fruit and Vegetables in Interstate Trade and Coordination of Transportation by Shippers and Receivers ... 2k 7 Estimated Maximum Transit Times in Hours for Truckload of Fresh Fruits and Vegetables Shipped from Central California to United States Points I4.6 8 Total of Freight, Standard Refrigeration Salting Rates and Federal Tax on Shipments of California Fresh Fruits and Vegetables to United States Points, in Cents Per 31-Pound Container, Summer, 1953 hi 9 General Pattern of Estimated Rates for Truck Transportation of Peaches from California to United States Points as Quoted by California Truck Transportation Brokers in Cents Per Lug, Summer, 1952 k9 List of Tables Tab le 1 Intercity Motor Vehicle Ton-Miles: Public and Private Intercity Freight Traffic by Motor Carriers, 19UH-1952 .... 2 2 Illustration of Calculation of Refrigeration Requirements of a Truckload of Thompson Seedless Grapes Transported for 60 Hours Under Typical Conditions ............... 16 ■ * v « ■ (r 1 t » r. I TO 1 etoamvi&rpiH tto^fi^T'**^^ 1% : ^|Ml»i>if'D lo l£W£ Page 3 Number of Commodities in Truckloads of Fresh Fruit and Vegetable Outbound Through California Border Stations 25 h Monthly Rail Shipments of All Fresh Fruits and Vegetables from Three California Counties, 1953 68 5 Monthly Rail Shipments of All Fresh Fruits and Vegetables from Three California Counties, 1953 70 6 Monthly Rail Shipments of All Fresh Fruits and Vegetables from Two Counties, 1953 • • . 71 LONG-HAUL TRUCK TRANSPORTATION OF CALIFORNIA FRESH FRUITS AND VEGETABLES Guy Black^ I. The Reasons for This Study- How long-haul truck transportation of California fresh fruits and vegetables can be used more effectively is the concern of this study. It is hoped that it 2/ will contribute to the produce industry's efficient use of transportation.— It is hoped that this study will help solve the problems confronting the produce industry in the use of the trucks at its disposal. Growers, truckers, and the middlemen of the produce industry have a common interest in trucking. There are many shortcomings to trucking as it exists to- day, and both individual action and cooperation can make trucking more effective. Long-haul trucking of produce has grown so fast that we have every reason to be- lieve that it will continue to become more and more useful. In the first part of this study, how trucking of California fresh fruits and vegetables is done is examined in detail. Following this presentation, prob- lem areas confronting shippers and others are searched out and examined. Then, steps which have been taken to overcome these problems are considered. Proposals for the future are examined in as much detail as readily available information permits. To be sure, action to improve produce transportation should always be based on an understanding of the over-all transportation system and not merely truck transportation. This study is of one phase of truck transportation only, and its restricted scope means that, before drawing conclusions, you should learn a great deal about other transportation. Some limitations of this study have to do with local truck transportation and long-haul rail transportation, neither of which are considered. Other limi- tations come from the unavailability of much important data. To a large extent, l/ Assistant Agricultural Economist in the Experiment Station and on the Giannini Foundation. I wish to acknowledge with thanks the cooperation of mem- bers of the fruit and vegetable marketing industry, the transportation industry, and my colleagues in the universities and in government in making available the information on which this publication is based and in helping me eliminate errors and oversights. The editorial office of the College of Agriculture has been very helpful. 2/ The term "produce" in this publication means fresh fruits and vegetables only. 3*««3 BtriT TO I -ofSiK-SOJi ari : - > • ■■ '"• ' ■ ' ■: ■ ,■ • : ■ • . • " is - • ■ : ■ '■ 8 - • '•. ' ' • . '. ..• . .■ fort suii'Sfoi/'tJ siL&fl fffeo -no^iViscrcoo brs-? r. plicus .leOfcivIfaui". rl. no j .... mo Tin o: SVjn-eit;-. [trade ooiiii-iWJftflBSct - 'S'sC'frs'j ie tfov- » eVxe'Jfe-.K J-skoo'-. *jf*£tf«*r£ ' sis ' 'r& xfih lb " i s»d .t 1 ?a ■1st' fu 2. public information on transportation is a by-product of public regulation, and since interstate truck transportation of produce is exempt from most regulations, our information is weak. The Changing Transportation Picture Today, the transportation industry is at midstream in a technological revolu- tion produced by the substitution of trucks and highways for trains and rails. How rapidly trucking has grown is shown in Table 1. TABLE 1 Intercity Motor Vehicle Ton-Miles: Public and Private Intercity Freight Traffic by Motor Carriers, 19kli-1952 Per cent of all intercity freight Millions of traffic — rail, highway, waterway, Year ton-miles pipe line, and airway 19hh 58,OU7 5.33 19U5 66,6lU 6.39 19U6 81,676 9.01* 19U7 101,667 9.98 19U8 115,U67 11.05 19U9 12U,9U9 13.67 1950 170,l8U 16.06 1951 182,1*67 15.56 1952 181;, 106 16.21 Source: Interstate Commerce Commission. Bureau of Transport Economics and Statistics. Intercity Ton -Miles, 1939-1952 , with Adjustment of Motor Vehicle Ton -Miles . (Statement No. 5kk, File No. 10-D-7, March, 195U, p. U. Estimated from data from Bureau of Public Roads.) What the future may be for trucks hauling fresh fruits and vegetables is hard to guess. The increased business of long-haul trucking involving movement of fresh fruits and vegetables was discussed in a recent ICC report: "Freight is transported over the highways for long distances in sub- stantial quantities, and such transportation is constantly increasing. . . . "The average length of haul on the lines of individual class I intercity motor carriers has increased from 177 miles in 19U5 to 218 miles in 191*9 > while the comparable railroad average decreased from 2I4.I miles to 229 miles. This does not measure the average distance per shipment, as there is a substantial amount of joint-line freight. vr' i«K$ ,i?coa£ Xa#g#? Jii^d t n©jsBi«raoO aim* 32. During January and Febru- ary, a trickle arrived from Florida. This increased in March to 5>1 carloads. But during March, Louisiana entered the market. Florida gradually dropped out so Louisiana became the sole source of supply. In May, Illinois production became important, and, in addition, supplies came in from California. Louisiana and the riO «f« boil ti&t >4* FIGURE 2 Carload Shipments of California Fresh Fruits and Vegetables by Crop Reporting Districts, Monthly, 19$1 (thousands of carloads) 8 Northern District JFMAMJ JASOND All California JFMAMJJASOND Source: Compiled from data of the U» 3« Production and Marketing Administration, Federal-State Market News Service, Sacramento, California. Imperial District 9. local producers had dropped out by June, but Michigan shipped 75 per cent of the strawberries received at Chicago during that month. California kept sending strawberries to market and from July-November was the only source of supply. Another example is asparagus. California is an early producer and dominates the eastern market until eastern production becomes available in quantity. This drives down the eastern price so that California shippers can no longer stand the transportation costs and divert their production to canning, freezing, and local markets. The California season for shipping east opens when the California crop becomes mature, and the date on which the eastern crops mature effectively brings the California shipping season to a close. Not one but many perishable commodities must be handled in this way — simul- taneously. Some crops make major demands on transportation facilities. For a short period each spring, half the potatoes being shipped in the United States come from Kern County, California — a matter of up to SCO carloads a day. The significance of these typically complex supply situations is that a transporta- tion system is needed that will meet the needs of all of the. United States and must be prepared to furnish transportation first from one area and then from another. The perishability of the commodity and the rapidity with which the geography of supply changes set produce marketing and transporting apart from the marketing of products whose production and distribution from well-established locations are fairly stable and predictable. Cost of Transportation Compared to their value per pound, fresh fruits and vegetables are rela- tively heavy. For this reason, transportation costs can be an important indus- try problem. One of the most fundamental means of overcoming high transportation costs is, of course, to concentrate production as near to points of consumption as is practicable, even when some increase in production cost is involved. How- ever, the specialized cultural requirements of many fruits and vegetables mean that they cannot be "market oriented" in this way. Many of the California fresh fruits and vegetables that are shipped to eastern markets incur transportation costs comparable to their price at point of shipment. The prices received by California shippers for their produce are, therefore, greatly affected by the level of transportation rates and also by the relative transportation costs of other areas supplying the same consuming centers as does California. It is of critical importance to California growers that the rates they pay not become high compared with rates charged other areas. In the case of rail transportation, California growers can protect themselves in ICC rate-determination hearings. 10. However, in the case of unregulated truck transportation, the free play of the market determines relative transportation charges. This might sometimes create serious difficulties for California shippers; actually, however, recent develop- ments in truck transportation appear to have been to the advantage of California shippers . Speed Requirements Few other industries demand expedited handling with the persistence of the fresh fruit and vegetable industry, yet, because cf the bulkiness of the product, this must be low-cost transportation. Freshness on arrival can be a controlling factor leading shippers to pay the extra charges involved in rapid transporta- tion. Fresh strawberries have been shipped from California to Chicago by air primarily because they w»uld arrive in superior condition. The cost of air transportation generally precludes its use, however, and even railway express is used «nly to a limited degree. Speed is also important for another reason. Fresh fruit and vegetable prices fluctuate frequently and rapidly. Aside from the problem of deteriora- tion, there is always a chance of substantial economic loss through changes in the value of inventories, including inventories of produce being transported. By speeding up transportation, inventories can be reduced and the risk of loss through change in price reduced thereby. Truck transportation has permitted a higher speed of transit at little or no increase in cost over rail rates. Frequently, truck shipments move as rapidly as railway express shipment. It is feasible from the c«st p*int of view to use truck shipment during the entire shipping season while express rail and air ship- ments of fresh fruits are good business practice only in the early part of the shipping season when the chances are that rapid price declines can be expected. Once the period of relative price stability (typical of the midseason of any com- modity) is reached, express and air are seldom used. The shorter transit time and easier ride provided by express and air shipments would iroi:r-»ve p. educe 1/ quality at all times, but the price risk is no longer as important.— 1 Perishability as a Problem in Produce Transportation The perishability *f fresh fruits and vegetables is responsible for many unique characteristics of their marketing. The most striking — although not l/ It should also be noted that the keeping quality of immature fruit, most common at the first of the season, is poorer than average. T •'IPVO 1 11. necessarily the most significant economically — is refrigeration. Perishability has created the need for specially insulated equipment. The "reefer," a famil- iar sight on all railroads, is a unit capable of maintaining the temperatures and humidities required for produce quality. Railroads have developed techniques for controlling temperature conditions at all times of year and will follow rather explicit instructions on the part of shippers. Motor carriers, where long hauls are involved, have developed comparably specialized equipment. Such trans- portation improvements as greater speed, easier ride, and better temperature con- trol are always being sought. Perishability can be defined in terms of economic effect. It is the natural tendency of a commodity so to change in character over a period of time, through maturity, decay, dehydration, or other life process, that the effective demand for or salability of that commodity is decreased — eventually to the point of non- salability. Perishability of produce is increased by mechanical damage from jar- ring, bumping, or crushing. Even after harvest, fresh fruits and vegetables continue their life proc- esses, some even reaching maturity after being picked. They continue the proc- esses of respiration — oxidizing sugar and generating heat. The rate of respira- tion increased with temperature and, in some cases, is affected by the degree of ripeness. The quicker cooling can be accomplished after harvest, the sooner these processes are slowed down and the better produce will be preserved. Some vegetables and fruits, such as spinach, broccoli, strawberries, blackberries, and figs, have especially high respiration rates. Cooling can be overdone, as prod- uce also is injured by too low temperatures. Summer squash, tomatoes, cucumbers, and sweet potatoes are liable to injury at temperatures no lower than 5>0° F. Humidity as well as temperature is important. Produce high in moisture tends to lose water by evaporation after harvest. This produces wilting and loss of quality and weight. By maintaining a relative humidity of 85-95 per cent and by keeping down temperature, this water loss can be minimized. Some produce is waxed to reduce water loss, and wrapping also is sometimes of benefit. During transportation, temperatures must be held relatively constant because changes in temperature lead to condensation of moisture on produce and loss of quality. Other Requirements Some commodities cannot be stored or transported together for even a short while. Apples will absorb undesirable odors from potatoes. Other combinations which should be avoided are apples with celery, cabbage, or onions; celery with — v£J.£0 12 onions j and citrus fruit with any of the strongly scented vegetables. Also, ethylene gas, which is present in the exhaust fumes of gasoline engines and is given off by some fruits, has a powerful ripening effect on some other fruits and causes rapid deterioration of flowers. Special care is required in packaging and loading fresh fruits and vege- tables. Produce is easily damaged by rough handling. Yet, growers cannot bear the cost of really expensive packaging. Containers must be reasonable in price, designed and loaded to permit free circulation of cooling air during the trans- portation period. Most of the research on improved transportation of perishables has dealt with rail transportation, and while, no doubt, the same information is generally applicable to trucks, they have their special problems too. The motion of a truck differs from that of a railroad car, for one thing. Generally, trucks give an easier ride but, in the case of strawberries, some peculiarity in the motion of truck has made it not practicable to substitute trucks for rail transit. New types of running gear for trucks, such as air suspension "springs," may change this situation. The truck industry has not developed as elaborate techniques of refrigera- tion nor the methods of enforcement of icing schedules which are railroad proce- dure. However, there seems to be less need in trucking for many of the precau- tions typical of railroads. Refrigeration Equipment Ice is the standard refrigeration material in produce transportation. Trailers used for produce hauling are designed with bunkers in the nose, holding up to 3,000 pounds of ice plus 10-2$ per cent of that weight of salt. In addi- tion, snow or chopped ice may be blown in on top of loads to provide extra cool- ing or to create the moist condition favorable to preservation of quality. Cir- culating fans or air vents are used to circulate the cool air, and canvas ducts are used to improve its distribution. Dry ice can be used in place of "wet" ice, although it is more expensive and not so widely available, and adequate control of temperature variation has been hard to obtain. Its widespread use depends on development of satisfactory tem- perature control and lower costs. Dry ice has the additional advantages of lower weight and dryness which makes it easier on the truck equipment. WLth salty wet ice, moisture corrodes the truck body and eventually gets into the insulation, greatly reducing efficiency. Dry ice is widely used for frozen commodities where temperature variation is not a problem, provided that the load is cold enough. 13. Mechanical refrigeration is also common. Some mechanical refrigeration units are small and merely supplement other means of cooling or delay the inevit- able rise in temperature long enough for the truck to arrive at destination with- out too much loss from deterioration. Other refrigeration units have a capacity equal to four or five tons of ice and are capable of maintaining near zero tem- perature for considerable periods of time. Such units are used with trailers in- sulated to meet the stringent requirements of frozen foods, concentrated juices, or meats. They more than meet the requirements for fresh fruits and vegetables.^ Heat Removal Requirements of Various Loads Surprising as it may be, more refrigeration capacity may be required to hold a load of produce at U0° F. than to hold a load of frozen food at 0° F. This is because, at the temperatures at which produce is transported, the vital head of the load may make important demands on the refrigeration system. For example, in a trailer where a dry ice system could maintain a load of frozen food at 0° F. with 3U0 pounds of dry ice per day because 25,000 pounds of lettuce at U0° F. would release 15,990 Btu. of heat per ton per 2U-hour period, keeping a load of lettuce at k0° F. would require 592 pounds of dry ice to compensate for the vital heat released. Since 16? pounds would be required to overcome the trailer's heat leakage at k0° F., 759 pounds would be used in contrast with the 3h0 pounds required for a 0° F. load which released no vital heat. The vital heat evolved by commodities is a highly significant factor in refrigeration requirements and varies tremendously. Ten tons of peas, broccoli, spinach, snap beans, lettuce, and sweet corn at 60° F. may produce enough heat 2/ to melt one and a quarter or more tons of ice per day.— Some commodities, such as l/ The U. S. Production and Marketing Administration has made a series of tests of vehicle refrigeration units. See, for example, H. D. Johnson, and C. E. Garver. T est of a Mechanical Unit Designed to Maintain Low Temperatures in Motor Truck Transportation . (An interim report) Washington, D. C, U. S. Production and Marketing Administration, March, 1953. Processed. See, also, Some Refrigera- tion Tests of a Motor Truck -Trailer Equipped with One Type of Dry Ice System of Refrigeration . April, 1953. Processed. There are many other tests which have been reported by this agency. .2/ For a tabulation of heat of respiration of various commodities and an ex- cellent and brief discussion of the problem of storing perishables, see D. H. Rose, R. C. Wright, and I. M. Whitman. The Commercial Storage of Fruits, Vege- tables, and Florists Stocks . Washington, Govt. Print. Off., 19U9. (U. S. Dept. of Agr. Circ. 2?8, revised.) ;> f row I 1U. grapes, evolve heat at a low rate. At temperatures in the low UO's, Emperor grapes evolve no more than 35 Btu. per ton per hour. Figure 3 shows how the amount of heat, evolved by certain fruits and vegetables, changes with tempera- ture. Calculating Refrigeration Requirements Table 2 shows how to calculate total heat to be removed, using Thompson Seedless grapes as an example, and how to convert refrigeration requirements into tons of ice required.— ^ It is evident from the requirements that a fairly small mechanical refrigeration unit would be satisfactory for transporting precooled grapes. However, in the case of 12 tons of lettuce loaded at U0° F. into the same truck for the same trip, the total demand would be for removal of 12,300 Btu. per hour — enough to melt 2.6 tons of ice during the same 60-hour trip. Since it is not considered advisable to operate mechanical refrigeration equipment continu- ously with no reserve capacity, only the largest mechanical units now available could handle a load of lettuce at the same temperature at which a smaller unit could handle a load of grapes. Data of the same sort indicate the vital importance of precooling commodi- ties with a high rate of evolving heat. If the same 12 tons of lettuce were loaded at 60° F., the heat removal requirement would be 27,500 Btu. per hour, and it is doubtful that any mechanical refrigeration unit now in common usage could remove this heat, plus the sensible heat in the lettuce van and containers, at a rate sufficient to prevent severe spoilage. Temperature Ranges For extended storage periods and optimum results, conditions under which produce can be stored are rather narrowly defined. "Variations of 2° or 3 F. 2/ above or below the desired temperature are in most cases too large.' 1 - Since l/ Table 2 is patterned after ¥. T. Pentzer. Refrigeration of Fruits and Vegetables in Transit . Davis, 1953. PP. U1-U8. (Association of American Rail- roads, Proceedings of Conference on Transportation of Perishables at Davis, Cali- fornia, February 5-7, 1953). The information on refrigeration requirements in this section must not be used as a guide for actual commercial operations and are only illustrative. Shippers of produce are advised to consult refrigeration ex- perts for information on their own shipping problems. 2/ Rose, D. H., R. C. Wright, and I. M. Whiteman, op. cit ., p. 3. 15. FIGURE 3 Approximate Rate of Evolution of Heat by Certain Fresh Fruits and Vegetables When Stored at the Temperatures Indicated 2,500 Temperature, degrees Fahrenheit Source* Based on D. H. Rose, et al. The Commercial Storage of Fruits, vegetables, and Florists""Stocks . Washington, Govt. Print. Off., 19U9, pp. 7-9. (U. S. Dept. of Agr» Circ. 278) 16. TABLE 2 Illustration of Calculation of Refrigeration Requirements of a Truckload of Thompson Seedless Grapes Transported for 60 Hours Under Typical Conditions ASSUMPTIONS: LEAKAGE OF TRAILER : HEAT OF RESPIRATION: HEAT FROM BLOWER: TOTAL HEAT PER HOUR: Cargo of 1,125 lugs of Thompson Seedless grapes weighing 15.73 tons. Cargo loaded and maintained at an average temperature of U3 F. Outside average temperature 83° F. Trailer measures 35 x 8 x 85 feet with 3 inches of fiberglas insulation (1,291 square feet of outside surface). Heat of respiration of Thompson Seedless grapes at U3° F. is ii3.8 Btu. per ton per hour. Heat conductance of wall section of trailer is .083 Btu. per square foot per hour. Door leakage of trailer amounts to 15 Per cent. Blowers in trailer produce 500 Btu. of heat per hour. Walls 1,291 x .083 x UO = U,286 Btu. per hour. Doors U,286 x .15 = 6U3 1*3.8 x 15.73 = 689 500 6,118 Btu. per hour. TOTAL ICE MELTED IN 60 HOURS (TONS): 6,118 x 60 0 Ihh x 2,000 ~ U£ Z ons RESERVE ICE REQUIREMENTS: TOTAL ICE REQUIREMENTS: Estimated .5 tons. 1-3 A tons. 17. produce being transported is not generally intended to be stored for any exten- sive period of time, refrigeration requirements are less severe than those for cold-storage plants. A recent publication giving permissible temperature ranges for a period of air transportation up to 1*8 hours is available.—^ These data are generally applicable to truck movement also. Pre cooling One of the important developments in refrigeration of produce loads has been pre cooling which first appeared before 1910 and was extensively adopted in the citrus industry at that time. Widespread use elsewhere did not develop until the late 1920's.— Precooling is especially important in truck shipment since truck refrigeration units are often just barely adequate and trucks are often loaded in ways which result in poor air circulation. Precooling has the advantage of quickly removing field heat thereby quickly reducing the respiration rate. Keeping quality is improved and the amount of refrigeration necessary in transit is reduced. Better control and uniformity of temperature are possible when prod- uce is precooled. Precooling may be done in separate rooms, by hydrocooling, or in transportation equipment, especially rail refrigerator cars. When done in cars, forced air circulation and external mechanical refrigeration are used to provide more efficient cooling than is possible from bunkers of ice. Air is cir- culated in reverse of the direction of normal flow during transit as a means of compensating for the temperature gradient resulting from convection and blower induced air circulation during transit. The truck operator cannot afford the delay of having his equipment standing idle while attached to an external source of refrigeration for precooling. He is, therefore, greatly helped by having adequate plant precooling facilities. Gen- erally, those shippers who use trucks have installed precooling rooms in their packing sheds. One recent development at small packing plants which previously had no precooling facilities (because they precooled within refrigerator cars) has been to use old rail refrigerator cars set up on blocks as precooling rooms. l/ Claypool, L. L., L. L. Morris, ¥. T. Pentzer, and W. R. Barger. Air Trans- portation of Fruits, Vegetables, and Cut Flowers; Temperature and Humidity Re- quirements and Perishable Nature . Beltsville, Maryland, U. S. Bureau of Plant Industry, Soils, and Agricultural Engineering and Calif. Agr. Exp. Sta. H. T. & S. Office Report No. 2^8, October 15, 1951. 2/ Ande rson, Oscar E. Refrigeration in America . Princeton, New Jersey, Princeton University Press, 1953, PP. 153-155 and 251-252. : IB. III. Functional Description of Truck Transportation of Fresh Fruits and Vegetables Equipment Used For long-distance transportation of fresh fruits and vegetables, the operat- ing costs of very large units are lower than the costs of smaller units by such a margin that only large-scale equipment is used. Equipment is not standardized. Specifications depend largely on the owner's ideas. They are influenced by his financial position, the types of hauling he expects to do, and most important, the legal requirements of the various states regarding height, width, length, and weight. Requirements vary from state to state, although less than formerly due to influences of the recommended minimum standards of the American Association of State Highway officials. Truckers choose their rigs according to where they wish to operate. A trucker may select equipment of Derhaps limited length because it is legal in the states with the most restrictive laws. Alternatively, he may choose equip- ment which is larger and more economical to operate but which can be operated in fewer states.— ^ It is paradoxical that the effect of dimensional restrictions of various state laws is such that the larger equipment, which achieves its greatest economy on the longer hauls, is more restricted in area of operation. While trucks can be at least 60 feet long in the 11 most western states, the laws make it impractical to operate equipment over US> feet long in the large 2/ population centers of the Midwest, South, and East.- Long-haul truck units almost invariably consist of a four- or six-wheel truck- tractor unit hauling a van body semitrailer. Sometimes an additional full 1/ Hillman, J. S., and J. D. Rowell. Barri er s to Interstate Movement of Agri- cultural Products by Motor Vehicle in the 11 Western Sta tes. Tucion, 1953. U7p. (AriiL. Agr. Exp. Sta, Bui. 21*8) See also Watch Your Weight , (current edition) Truck- Trailer Manufacturers Association, Inc. Washington, D. C. 2p. 2/ Long-wheel base tractors are used to meet the requirements of various state laws" which incorporate formulas involving the concentr ation of weight on the high- way. By spreading out the axles, the maximum permissible load in a unit is in- creased. Some tractors have a movable "fifth wheel" to legthen or shorten the over-all combination and thereby meet various combinations of load and over-all length requirements. 19. trailer (or semitrailer with dolly), and sometimes a larger truck hauling a full trailer is used. The truck- tractor and semitrailer combination is preferred for its maneuverability and the advantages of having a detachable power unit. Van bodies with insulated walls, roofs, and floors are essential for long hauling of perishables. There is some variation in types of insulation, but spun glass is by far the most common. The thickness varies according to the tempera- tures to be maintained and the capacity of the refrigeration system. Three inches of insulation is probably the most popular and is considered suitable for loads carried at l|0°-60° F,, but 6 inches is common for units which haul frozen fruits, vegetables, and concentrated juices, A typical semitrailer van, as used on the Pacific Coast, having 3 inches of insulation all round and ice bunkers, might have the following dimensions: Such a unit combined with truck- tractor might have an over-all length of from U5-53 feet, depending on the design of the truck- tractor , Associated Facilities Efficient truck operation requires loading docks at pickup and delivery points. Terminals are needed where assembly, distribution, or transshipment are common. There are a few terminals for assembly of truckloads and less-than- truck- load- lot shipments in California, such as at the old produce market in Stockton, where one trucker specializes in assembling small lots of produce from many shippers and delivering it to various commission houses in Los Angeles, Such operations are far more common in the truck crop areas of the East than they are in California, Lack of such facilities is a common problem among the truckers serving the produce industry; only a few of the shippers or receivers are well equipped. Some of the large shippers by truck in the Los Angeles area have developed elaborate assembly and loading facilities for transshipment of produce received from the Central Valley, There are no union truck terminals specializing in refrigerated produce. length (outside) width (outside) length (inside) width (inside) height (inside) weight (empty) payload 35 feet 7 feet, 11-3/U inches 33 feet 7 feet, 2 inches 7 feet, 2-1/2 inches 10,^00 pounds U2,000 pounds 1,706 cubic feet volume (payload) 20. Although it affects the quality of produce for it to undergo the temperature changes involved in transferring it from one refrigerated truck to a loading dock and then to another refrigerated truck, it is not uncommon for produce to be trucked into Los Angeles from the Central Valley and there assembled into mixed loads for shipment out of state. Upon arrival at southern or midwestern points, such produce is, of course, reloaded into delivery trucks which may sometimes be refrigerated units. Some service wholesalers use insulated hampers to protect small quantities of produce during the last stage of its journey to retail stores. Mechanics of Truck Movement Figure h shows where California's fruits and vegetables are shipped by truck. These shipments are almost entirely by refrigerator vans which, on the average, hold somewhat in excess of the equivalent of a minimum or "usual" rail carload.^ The trucks assemble their loads from packing sheds, cold-storage warehouses, or terminal markets. Trade sources estimate that about three fifths of truck- loads originate at Valley points. Los Angeles, the main point for assembling loads to fill out-of-state orders and for transshipments, is estimated to be the point of origin for about one third of all loads. Very frequently, truckers will pick up their load at a number of scattered points rather than having the entire cargo assembled with smaller vehicles to be loaded at one point. The truckers' willingness and ability to pick up loads this way is among his important competitive advantages over railroads. Brokers or the main offices of shipping organizations, in contact with packers or units of their own organization, inform truckers where and when to pick up the load. Mien the truck has been loaded, the trucker obtains the usual bill of lading. He can also get an inspection certificate from an inspector of the Bureau of Plant Quarantine, California Department of Agriculture, certifying compliance with standardization regulations. Arranging for this certificate at the point of loading prevents the delay and inconvenience of border inspection later. Almost all trucks carrying produce have certificates of previous inspections 1/ The Federal-State Market News Service, Sacramento, California, made a special calculation of interstate passings in trucks for the week of July 2$-31, 1953, and discovered that, according to their standard conversions, the 1,U77 trucks carried an average of 1.19 carloads per truck. Letter from Kermit Olson, Sacramento, Cali- fornia, August, 1953. FIGURE h Outbound Truck Passings of Fresh Fruits and Vegetables Through California Border Stations in Carload Equivalents, 1951, 1952, and 1953 - 1952 Total 44,646 5 1,155 55,513 533~I953 Source t Calculated from data of the U» S# Production and Marketing Administration, Federal-State Market News Service, Sacramento, California. 22. when they reach the border .-^ There are 16 "ports of entry" in California at which outgoing produce is inspected. Figure § shows the relative use of the various stations by truckers. About one third of all loads involve pickups at three or more points. These pickup points commonly are widely scattered, a substantial proportion (estimated at one fourth) of multiple pickups being made at points separated 2/ by more than 200 miles.— Responsibility for loading is shared by shipper and driver. The trucker is also concerned with icing and precooling arrangements. For regular icing of the load, he must proceed to an ice plant unless he has a mechanical refrigerator unit and does not plan to use top ice. While en route, the driver may be required to place daily "check calls" to the receiver to give him an idea of time of arrival and to reassure him that noth- ing has gone wrong. Upon arrival, truckers deliver the produce to the receivers and collect transportation charges and the cost of refrigeration less an advance. Frequently, the trucker is obliged to settle any damage claims on the spot, A typical trip cycle of a hauler of exempt commodities is pictured in Fig- ure 6. This may vary considerably. While most truckers operate on regular routes, others roam widely. They seldom have ICC operating authority for any kind of trasportation but operate under lease to authorized carriers or private haulers when they are hauling nonexempt commodities. Produce truckers accept a general responsibility to maintain an adequately low temperature of their cargo and replenish ice or maintain the refrigeration equipment at their own discretion. Generally, it is understood that ice bills or refrigeration charges are to be added to other transportation charges. This arrangement is considered to be sound since it minimizes any incentive on the part of the trucker to skimp on refrigeration. 1/ In the period January- October, 1903, only 1,185 out of U6,99$ outbound trucks carrying fruits and vegetables obtained their certificates of compliance at the border stations. The majority obtained them at point of loading. Let- ter from L. J. Lefebvre, California Bureau of Plant Quarantine. 2/ The estimates quoted in this section are based on confidential information supplied by a number of large shippers and brokers who cooperated by making some of their records available for analysis. The information was not tabulated be- cause of noncomparability of records of various concerns. However, it is believed that the estimates, derived from examining the records, are accurate general indi- cations. 23. FIGURE 5 Percentage Distribution of California Fruits and tegetables Transported Out of California by Truck, by Border Stations, 195>0 Smith , Rivtr f* / .14 ,Hornbrook nffQWOOO i ^ 23 Highway .30 \ ' DorrU 28.05 Tuleloke .58 • Alturat .11 Peavine .12 Truektt 6,07 Stattline .15 Sacramento Coleville .03 , Stockton San Francisco f\\POaklond Benton 2.2 Watsonvilt* Fresno (I Oil Bakertf ield Yermo 11.14 In 5.i3 'Daggett Lot Angelelj Parker 2.33 Blyths 16.65 Sources U. S» Production and Marketing Administration, Federal-State Market News Service, Sacramento, California. San Diego El Cintro Yuma 22.8 FIGURE 6 Typical Movement of Motor Vehicles Carrying California Fresh Fruit and Vegetables in Interstate Trade and Coordination of Transportation by Shippers and Receivers CARRYING FRESH PRODUCE CARRYING MEAT, ETC. EMP TY TELEPHONE COMMUNICATION SERVICE WHOLESALE CITY A SERVICE WHOLESALE CITY B SERVICE WHOLESALE CITY C Shipper or buyer coordinates orders to make up a truck load. Order f .o.b. from shipper 4 Trucker places "Check call" daily after second day A" PACKING PLANT COLD STOR- AGE WHSE. Buyer deals with trucker or packer MIDWESTERN MEAT PACKER Shipper instructs trucker about loading arra n ge men ts Trucker or packer may deal with produce buyer Uo Trucker calls when ready for load LOS ANGELES PRODUCE MARKET Shipper has facilities in Los Angeles Market WEST COAST MEAT HANDLING AGENCY Note: Meat is typical example of what might be carried. 25. Mi xed Loads Popular Data on composition of mixed loads show that these shipments are popular and varied. The Los Angeles market in particular specializes in assembling the extremely mixed "drug store" type of cargoes. Where large quantities of a few kinds of produce are wanted as, for example, half a cargo of grapes and half a cargo of peaches, the trucker is more likely to travel to the pack sheds where the produce was prepared for market. Mixed loads are more important in the southern part of the state. At the southern ports of entry, Uk»3 per cent of the loads of produce leaving the state had, in three surveys combined, five or more items, while for the state as a whole, only 3li,5 per cent of the loads contained five or more items. TABLE 3 Number of Commodities in Truckloads of Fresh Fruit and Vegetable Outbound Through California Border Stations^/ Period Number of trucks Per cent of trucks carrying specified number of commodities One commodity Two to four commodities Five or more commodities Total March 9-15, 1953 887 36 28 36 100 April 13-19, 1953 1,011 37 31 32 100 July 25-31, 1953 1,177 h$ 28 27 100 a/ Complete enumeration for period stated. Source. Compiled by U, S. Federal-State Market News Service, Sacramento, California, Mixed loads are almost invariably assembled by one shipper. Very few inter- state truckers of agricultural commodities are acting as itinerant merchants to- day, although this manner of operation was important in the 1930 's^ or accept less- than- truck load quantities. The trucker's usual role is to follow the instruc- tions of one shipper who may assemble the full load from several sources and who makes a single contract with the trucker, Fhat Produce Truckers Are Like There is no information available on xtfhich to base a statistical descrip- tion of truckers who serve the produce industry. They are mainly an unstudied 26. group about whom no organization gathers much data. It appears that the majority of them are either owner-operators or are small concerns. Most typical, probably, are the small fleets of trucks which bring meat, eggs, or dairy products to the West Coast. Although the seasonal pattern of inmovement of meat does not coin- cide perfectly with the seasonal pattern of outmovement of California fresh fruits and vegetables, these two movements have permitted haulers to obtain an adequate load factor .-^ Generally speaking, because they have refrigerated types of vans, the exempt haulers concentrate on cargoes requiring refrigera- tion. They cannot make as much money hauling other exempt commodities, although quite a lot of this is done too. Dried fruit being sent out of California is a popular cargo of the type not requiring refrigeration. Many other truckers are privat« haulers or independent operators under lease to meat packers or with other long-term arrangements for movement of westbound cargo. Some have ICC contract carrier permits. Their arrangements for eastbound cargoes are likely to be more irregular because of the seasonal nature of fruit and vegetable pro- duction. Seme truckers have been able to operate at a high level of efficiency be- cause of their success in making stable business arrangements. The most stable arrangements for eastbound movement are those made with the chain wholesale or- ganizations who ship regularly from integrated produce buying office in Califor- nia to warehouses where distribution to retailers takes place. Because of the frequent proximity of midwestern meat packers to these warehouses, truckers haul- ing meat can make regularly scheduled arrangements. This is a great business ad- vantage, of course, and truckers who have made such connections usually show greater than average financial strength, business responsibility, and rate of growth . Few of the really large trucking concerns do much produce transportation. Several have had some experience, and there is a certain amount of interest on their part; but in general, the seasonality of the traffic, the technical prob- lems and equipment needs for hauling perishables, and the unsettling effect of uncontrolled competition from small independents have caused them to stick to other transportation. That competition from the independents is the most signifi- cant factor is suggested by the larger conern's interest in hauling frozen foods and meat where the technical problems are similar but competition is controlled by ICC regulation. 1/ This is according to trade reports. There are no data on the monthly ship- ments into California of fresh meat. ^i-T.of,j?:.t tissue, J I ,ss«Jxh fhw ?.*V3ii$i->$ fldx$»siaa,yxo 00 mcnv fcNMta ciroi^ ,v, i ''f&cfov: t » sox;^-? -'-f'-:- .s.vi^rto'j ir«*it to enoJciBoo-iaawo rretkH-i b $em lo fosmvorattt 1o n'iSs+^ft:- Isaoraa* sd.* rt^t/odxlA ,*S9oO *bs«' i$jn#! bi«to1HbD le ^aB^vc-too lo nt&ttAo Xmoefteit art* rftfiw ^Itf? sitae 9bi* Mmpqpralrt ava*1 -.;>;! + sem-ood • v f Ot^: •*£ ~ , iov 4 ssl bBof 6-i eao£*rft5> oo 9^mJsr690Qis Bioli/ad tomsxs ltl«9 lo too Jftya 3fl$Mf xiincl baltft ,Ou.t snob *i siftf lo J-oI 0 ©JXwp W« et aborts - *;.=»fi^o v;nsH .fioiJei£»3i*3le>T gn X'rXjjnat ton srf* lo o^tso t*Ixfooq a?iw to f.~9)Joao, ;f99/rr bbssX tabm/ ertoi'ft'iefio tafjttogvtai 10 Ri^Ii'Sii ffe^fiVX'/q 001 evari s-roS ,o;j**s9 bmtotf.t&ew lo tfnemevo:- to! e^rrsmeanBrrs nnftf-gAof f9;f.fo ^X9Jll. r 97', z&(*?,im bnx«oo'*CB9 tol etna^asxfB'jts iX9dt .etfijinsrf t9jt*£*8 HwKteoe -otq 9Xd£,+9o»sV bus Jli/rrl lo eii-Jsn Xenoesae Bit* lo Bribed •jr.Iosatti a?om 9d &t >„ - > * rt , . -9d yoncXDrlla lo £«*«I ffsirf 6 BtfStBOO 0-t 91^9 K99d" ?:V£/f Rlf^JXtCf 9fl->3 slffstfe ^eo.i 9fiT « BiaaawjjaBtt* uaenipx/d aid sift ^ftxafan til fieaeoce lo bpi-so -•jo elsegicrfw n/srto »rk- dtiv ©bsm 950rf.t 979 ;fn9,ri9r.te5iasTxs -lOliXfiO oi 90t"ilo ^nit^d 9owboiq bs*x**r3ov-Mi r^oil vXt*. to'^st ^iri^ odw enoA+fisliiG^ rsrw lo sf.ucosS .oosXo strtnt e«t9Xi9*9*l oi nol^i/f?ii*p..fb sj-ssriw ft«*e*;.7daiBw c-in -lirsri 6i&$!:mt % 8epi'ori6iev sasriJ - 03- fissinfsq *c9fn Bplft^Mwfcira lo X i+ ^^Tq d'flfli;'p9Tl -be gesalearf ^p©iraffs ^XlBi'81; nooiitoerfioo rioi/e sbam svBri ori^ si9>'on9ail $%b-i*ve tuuii **J««J .rioliB.t'lOnenBiJ- 90i/ftoid doirm ob snieonor) gttXjJnjft^ 9^ir£ ^XXAtn 9rfi lo IM^t 00 J-esnsiftx .ii«»<5mB iii&itfi') e sx 9^9fl.t bn^ ,9on9i.'r«)qx9 *tnoe bud fn'gri Xm9V?»S -d 9i9dw tssr; bar- ibr-.htfiijt^fl'; OC-X yd • r Y,tiifnOt4 9iix a^ r.frib na 9t*»dr liffi^Kl obs^i o* ^ftiJMfooos ftX BirtT *3'9em a'BSVtj lo ex.iiO'iiXsC; oini 27. In several ways, the methods of operating of the large organizations would interfere with their giving as effective service to the produce industry as can be obtained from the independents. For example, a system of division points and the adherence to rigid time schedules which is almost essential for large opera- tors probably means longer times en route. Also, the larger organizations tend to shun shipments to points off their regular routes since their operation re- volves around facilities and managerial staffs, a bases of operation along their usual routes. On the other hand, there are important ways in which the larger trucking organizations can render a more effective service. The Market for Truck Transportation of Produce Truck shipments are almost entirely f .o.b. and are carried out in accord- and with the receivers' or buyers' instructions. The receiver may undertake the responsibility of providing the truck. He may have made arrangements with a near-by midwestern trucker or he may contact a truck broker when he wishes to place his order for a truck. Shippers are unenthusiastic about such general in- structions as "ship by truck" and usually attempt to make the receiver specify the particular truck broker or truck line he wishes to have used or make specific trucking arrangements. Receivers have preferences for certain truck lines and often specify the truck line anyway. In the past few years, in response to the need for coordination, truck trans- portation brokerage has come into existence in California. Although relatively new in California, there have been truck transportation brokers in eastern and southern produce markets for some time.^/ They appeared 1/ Transportation brokerage is known throughout the trucking industry and i3 expressly recognized as part of the transportation function in the Motor Carrier Act, 1935. Brokers arranging transportation which falls under the jurisdiction of the ICC must be licensed and are regulated by the ICC, Similarly, many state agencies covering motor transportation include brokerage within the scope of their actions. But brokers who deal only with interstate movement of commodities exempt from ICC regulations are al30 exempt. The California Public Utilities Commission has decided that, on the basis of a recent court case and an ICC ruling, it has the authority to regulate truck transportation brokers who deal in interstate movement of ICC exempt commodities where the ICC has not occupied the field. This claim is based on a rather am- biguous state law passed before the Motor Carrier Act, 1935. Several brokers registered in 1953 and were granted licenses after hearings, but, generally speaking, truck transportation brokers arranging interstate movement of exempt commodities do not agree that the California Public Utilities Commission had any jurisdiction. In the summer of 195H, the Public Utilities Commission warned shippers of dried fruits against hiring exempt truckers for less than Public Utilities Commission established rates, even in interstate commerce. TO Mft -eh^'Af^ %$Sfi ^ - t '6£& ■ -&$Mk "iu>»»it ;e$di '-W^^ftKM «tferir'd*n\rs tr$Ji}t* t*&d> AWvMUMq *i>^ jrf&*3 xXsiiitfre HomlB SUM e&fi$mqthk jJsinT fjffij^iiftricart' Taviedai sri? t8fra.fc*Sifi£eai 'ets^od io''a , »^« otti dMtf lRit itfi* edrit»n<98n**ti 'Sbam evari ^afi sH ■ i^bi/icT srtf gftlMVoic *d ^ixlidtenaqEs 1 ! Mtf §* Qfrftatv eri irtftf rrs^ibd a/oxJii a ^osinod *rf td' ttMSirx* me^fesvbirr vrf-ruBsri 3 -rii ffl^e^ifdife *i/d*a aiiknxzBMaeaii i4t$$jUB liMBI! 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IV. Public Regulation and Truck Transportation of Fresh Fruits and Vegetables How It Came About Regulation of transportation by administrative agencies began with railroads in the 19th century following in large measure well-established principles devel- oped from English common law. Today motor transportation laws and regulations govern rates, entry into the transportation business, the kind of service, and the equipment which may be used. Transportation confined to one state is regu- lated by state agencies of which the California Public Utilities Commission, formerly the Railroad Commission, is an example. Interstate land transportation is the domain of the ICC. Originally, the regulation of railroads grew out of the demand for reform of abuses common in the early days of railroading. Since that time, the transportation industry has changed very much, and the basic laws and regulations governing transportation have had to be updated repeatedly. Motor carrier regulation came in 1935 some time after interstate motor transportation had become well established. The need for regulation was evident, by that time, to the railroads, shippers, the various states, and the motor car- riers themselves. Regulation had been made urgent by the rapid growth of long- haul traffic by truck and the limited authority of the states under the interstate commerce clause of the Constitution. Regulation of interstate trucking was es- tablished by the Motor Carrier Act, 1935, which became Part II of the Interstate Commerce Act. Regulation under this Act stipulated standard safety practices, limitation of the number of certificated or permitted carriers, and often required common carriers to maintain service where they might prefer to drop it, even though it would leave some communities with inadequate transportation. Rate regulation in trucking more often aimed at limiting cut-rate competition than at control- ling monopoly. Regulation is under the Interstate Commerce Commission. The ICC is in a rather complex position. It establishes, by congressionally authorized procedures, regulations of wide scope; holds hearings on suspected violations of those regulations; and adjudicates those same hearings. It both detects and punishes violations. Thus, the ICC combines within itself elements of legisla- tive, judicial, and executive branches of the government. Regulation as a Barrier to Interstate Commerce The regulations and agencies of the various states affect interstate motor transportation even if the states cannot regulate interstate transportation ■ ;'Vf * V iogdA «TtBv' *X wpH .s~ r P' ddftf ad* ax ar»X*&fv^rc baa a.vai p^^a<5q.w^*t4 -rjiip?' ^a^?.* .wsX; ^out^ dsjXX^S fg#l'b$g> baa jftfUyi^- 3q fca|;J aril jBjftgCttfEKf qo^i^J^aas.-rf «?rf.dt clrtX y-$crn.*r na^rqg si QJfeip ecp p.* ^aXfrfqp noMGiaoq^a.-jcT .bscv gtf jjam rfsirk jff^siqXtfpa sri.7 f r*p^BatiK(Bo.a epXXXXi*!! pXXp»* ^d sXttB-rt Xi-ad .-es ^asc a ffhfttt*H> oi&szzzlni la nGjJ$£u%$st t api*y^^oO srii Ip pei/aX? ppTanPoo aXGj.Bifjn:! ad*. 4p XX ^ annoed (teXdw ,^$)™ no*t*lm& nomnjoci tenX«pa*j :s*1q has $ g^i^as b«.|.M«waq ?p fc4$f.a^i*rj9o 7q .tad-wn ad* Ip *X d^priJ, nav^ t ii qo«b oi 7otp«q ^dgXjr: xpd* a-i»/i»' 99X7393 afaiakm oi. zxstiqv&s fioXAaX-^ax .8*eH .nqX/BJ^cafsnsii sJaupjabiinX ri«7 A^XJ-Xapm^p ampf aypaX bXupw -Xa-i^q.0 *# noXXXXaqnjo^ pXa^-X^p aaXXx.ini X +a baarXs a0fy &jptt $fii$T>int oX Si J9j| a»i^wi»S ^aXp^atfflJ 900 fyfcw zl aoicfsXfgaH . ^qp^pjj! ^olj ftf^llijllp ^XXBAolB^ai^aQp ^0 ^^.dBX.Caajeg XI .aoXJXBpq xaXqnq» %a.fia-? 5 ni .ai : lo «rtp^«X%i»- ba.*P?ge«.8 S9 pcinX^ait .cbXad laqoae oPXm 0© ZiioXXaX^^a'x \^-xpb9sq^q djf.od U /saflXnatri paoni ^ppX^bp baa ; ^aoX^X^a.V' P.apd* .t4X?45?X %^«,^?,f? 1£il*J 3i?'XXt: .f.9nXd.9po adcj ,spdT . app^aX^iy' a^fpiooa ^^ctaf^wpa #rf* 5.9 sadqr^id pyXv+wpejca fepe tiaXpi^jf, t avXX W'/Si nj&$^'}* : f ^ i*! ^f¥fi'--y- .f;:'^£^.y .§dd &§X.-3;^ a myH^ II -^.fi^fa «t«af3tf p f#Xr>Xi 31. directly. State regulations must be complied with by all vehicles within the state and, where a vehicle must pass through a number of states, the variety of these regulations can be a serious impediment. The more states a truck passes through, the more complex becomes the problem of complying with regulations of equipment, dimensions, weight, and axle loading. The restrictions of the most limiting state in effect determine the truck types which can be used over the entire route. Since the larger equipment is generally most economical on the longer hauls, this type of limitation is of most concern to the long-distance haulers • While no state can constitutionally levy import or export duties except as may be absolutely necessary for operation of inspection laws, a number of port- of-entry and quarantine requirements are in effect. States and smaller political divisions can apply fixed fees and per-ton or per-mile fees to trucks passing through them. Despite reciprocity agreements, an interstate motor carrier gen- erally must pay fees in several states. State annual fees in 1950 ranged from $U5-$830. They generally are higher for common and contract carriers than for private carriers and generally apply whether or not the trucker does any busi- ness in that state. Gasoline in the tanks of trucks passing through a state is sometimes taxed at the ports of entry.— ^ Local regulations severely limit itinerant merchant truckers almost every- where, and although this group no longer has its former importance in fresh fruit and vegetable marketing, it might reappear on a larger scale if the current strong demand by established merchants for truck transportation were to decline so that truckers might be encouraged to be merchants. 1/ There has been extended discussion of trade barriers arising from regula- tion. See : Purcell, M. R. Interstate Barriers to Truck Transportation . U. S. Bureau of Agricultural Economics^ Washington, Govt. Print. Off., December, 1950. Proc- essed. Hillman, J. S., and J. D. Rowell. Taws Relating to the Interstate Movement of Agricultural Products in the 11 Western Sta les. Tucson, May, 1952. (Ariz. Agr. Exp. Sta. Report No. 109) Hillman, J. S., and J. D. Rowell. Barriers to Interstate Movemen t of Agri- cultural Products by Motor Vehicle in the g We stern St ates . Tucson, 1953. U7p . -^Ariz. Agr. Exp. Sta. Bui. 2U8) Taff, Charles A. Commercial Motor Transportation. Chicago, Richard D. Irwin, 1950. (Chapter 13, "Restrictions of Interstate Movement of Goods") In addition, fruit and vegetable markets and the firms and persons operat- ing in them have been regulated by the U. S. Department of Agriculture under the provisions of the Perishable Agricultural Commodities Act. Solely transportation companies are not covered but are indirectly affected by this Act. ft*J fi*tt Ml till ,t?iifi» aSi^f M5i? ; Ii s»ttf S/tfrrwiSb tofts rfi !§£*&£l •0 p Itttaipji Hm TSlicfsnsa »| iufcif/jiiiirt ^**e ma , 9 i« 6 *| St tqaox* isihft gJggftNi *d *«IS^mf if I&rdi&tfjWiftaa =1*3 8iritfS &i sj&jtT «§j§l '** pp£ • tint* sai#*«jfcii jteJ*»Hd« ti£$fta*M ^isjaieerfs §d" $k isbiiKd? Hstt&m khh ttssKti ai m m$/mm^t wtom*** bit* -ieird 1 Oft* e*dB linta* sild §«0 Tt3 isrfisrtw jfgjjtyi til fe'isas^ 6ns atsiiHsd N - £ * g * *|*$**f ^rf>6Bfefi eiim? 16 ^.'«4i «d> rfi 9«lf5e*3 ifjfi* ai 839ft #**fil* 8^ji»j^.+ jfriitinwfliii jW)i||i|att|| ^^jftvsfc efid^^ici&i »Mi Iflifvi «| simeito^Mi iiMi &6» h0m Hi tjiMg &xri^ ttiiirtttrt &a& Ji-i^'fi/e sife 11 9t.*js f i35«iM d 95 Ufte^^i tttjlffl il ?«fiim aleisJ'jaSv fens • : :J " '~!&ztT>..&§. M.9teUf& w $Lxd imbmMviiU& {m\*T$ tWB «Sp »ai^7-- •-jptwo teibe>i^ fens ^Mfl ferfi fine &^«li$ i0 hfhftgq hmm m mm** m»M& tmfcm* $& (fmtsma mm 33. Private carriers are these persons, not common or contract carriers, who transport their own property for "sale, lease, rent, or bailment" in any commer- cial enterprise in their own or leased vehicles. An example of importance in fresh fruit and vegetable marketing is the midwestern meat packer. The Exempt Interstate Carriers A large class of interstate carriers is exempt from the major part of the regulations of the ICC. This includes motor vehicles engaged in carrying "live- stock, fish, or agricultural commodities not including manufactured products thereof if such motor vehicles are not used in carrying any other property or passengers for compensation."^ The agricultural exemption means that ICC does not have the power to pre- scribe rates or limits on rates, and rates do not have to be published. There is no restriction upon discriminatory business practices by truckers of exempt commodities. However, the same safety regulations apply as for nonexempt truckers. Exempt Commodities What constitutes an unmanufactured, agricultural commodity was clarified in a hearing following the so-called "spinach" or Harwood case. Agricultural com- modities falling within Section 203(b)(6) were said to include: 1. Fruits, berries, and vegetables, which remain in their natural state, including those packed in bags or other containers, by excluding those placed in heremetically sealed containers, those frozen or quick fro- zen, and those shelled, sliced, shredded, or chopped. 2. Fruits, berries, and vegetables dried naturally or artifically, in- cluding raisins. 3. Seeds, including inoculated seeds, but exclu ding seeds prepared for condiment use or those which have been deawned, scanified, or other- wise treated for seeding purposes. U. Forage, hay, straw, corn, sorghum fodder, and corn cobs. 5. (a) Hops and castor beans and (b) leaf tobacco but excluding redried tobacco leaf. 1/ Section 203(b)(6) of the Motor Carrier Act, 1935. Also, farmer owned ve- hicles transporting farm produce or supplies, and vehicles of agricultural co- operatives, are excluded from regulation. Formerly, the exemption applied only to carriers hauling exempt commodities exclusively . Under the ICC ruling of February 1, 1951, the exclusiveness of exempt hauling is no longer required, and common and contract carriers may haul exempt commodities without regulation of rates provided they do so in straight loads. This ruling was the outcome of the cases of ICC versus Dunn and ICC versus Service Trucking Company, Inc. The agri- cultural exemption was expanded by law in 1952 to include horticultural products. " : " '&-'*9ffi«™Pt lo ar^iife ^A -';^ibirf^ bafee&f to wo %9& ni' Wi'^^s^ Xfiio '"'ift&lbsa;' *ttiffli~rrt&SB$iriB» a:lt e.'f grtBl^ian- sldBi's^Qv bos Vllttl'rfsei't '9rf* lo disq lof.Ri-! artf moi'i *rjm9>;9 el 'etsiriftd "Wed aisASi io'eaflio ajrtsX A 9*ii*s ^bdoHtV s fcaJ:'X9:ia seoHi" f>!te" '^irss I"/?&b' £f99;f ' £»V fin "aOtdv 9POH* f'. *«T"4Plf tfn»rn*iii»>w s a^sooiK} ^nibees icI b9^6si ) 9p.i' •.7;% II^Xb'Bf^l'^l/E'gibiHsV' bn*;:^.' ; ^> t -^ .-ia'." X>lB5' ip ?!" ■ is ^Rj Ia'3"otiD6'ic ^^|?*.fa^^* > W#wipcj-'7: ^.fyW/*^ ^SW;^? 15 s.i^^eau,.^ t ,*:: n X amw9^m*tt$: : . sfe^poi. ' hn 6 S baft noflETOo i-voag it aevr no tJ 3U. 6. Raw peanuts and other nuts unshelled . 7. Whole grains, namely, wheat, rye, corn, rice, oats, barley, and sorghum grain, not including dehulled rice and oats and pearled barley. 8. (a) Cotton in bales or in the seed, (b) cottonseed and flaxseed, and (c) ramie fiber, flax fiber, and hemp fiber. 9. Live poultry, namely, chickens, turkeys, ducks, geese, and guineas. 10. Milk, cream, skim milk, including that which has been pasteurized, standardized milk, homogenized milk and cream, vitamin D milk, and vitamin D skim milk. 11. Wool and mohair, excluding cleaned and scoured wool and mohair. 12. Eggs, including oiled eggs, but excluding whole or shelled eggs, fro- zen or dried egg yolks, and frozen or dried egg albumen. 13. (a) Trees which have been felled and those trimmed, cut to length, peeled or split, but not further processed and (b) crude raisin syrup, maple sap, bark, leaves, Spanish moss, and greenery. 111. Sugar cane syrup, sugar beets, honey in the comb, and strained honey. All of the listed commodities are exempt, no matter how much sorted, boxed or packaged, washed, refrigerated, fumigated, ripened, dried (not dehydrated), shredded, chopped, or sliced. A packaged salad mix was not considered to be manufactured. On the other hand, the following were held to be manufacturing operations, and transportation of fruits and vegetables subjected to these opera- tions is not exempt: salting, crushing, extracting, steaming or filtering, blocking, canning, freezing (quick freeze process), dehydrating, evaporating, grinding (dry), fermenting, and splitting (peas). After the findings outlined above, it was widely assumed that the agricul- tural exemption was a settled matter. However, recently a court ruled that dressed poultry is also exempt. This interpretation has threatened to expand the scope of the exemption considerably. Consequences of the Exemption The transportation of exempt commodities is exempt, no matter by whom it is performed. The major economic significance of the agricultural exemption lies in its creation of a special group of commercial motor carriers who haul agricultural produce beyond the first point of sale. Just as with haulers of general merchan- dise, their business is primarily transportation, but by hauling exempt commodities only, they escape the bulk of regulation to which other carriers are subjected. Their whole manner of doing business is conditioned by this fact. Common and contract carriers hauling general commodities have found it impossible to com- pete with these exempt commodity specialists. ' ' : kaXEadsrta "e.$M -isri.to" She" feifofisa^ wbJ? . i iwrrfa'ioe hn-A • vystf-isd velso ^■saia.-.-morv. ( #fefltft ^£a.uB v i - bat'taX* toXiadgfe i fafoikaf io n t »t8'ja %P • t £>9©3XftfJ. 5 ^n»-- i 6s-ae«a*J'.o6'- (d) t b 0 s?a «2 10 asXsb" •ttx'-rKKrtdb (■?)' ,8 ••• • •mil -9Mt fons «titog$'&£& -viadxl aiflia* (o) .eesruog bns t 9asay ► a'jfctf/b * % WQ&m3 .>as.3fjJjrfa-:^l9jw^j , Vi^I'tdq''' 'svM . . y^Jfcu a J ia q ' esd daidw .j-drf#, ;^bgXofli ^jTXim ^ixsitBi -'-VitM^^CjN : .01 £, fca&' ^Iii./ Q- titn&tJtr-.-^m^'so bns .ill- f sir- -fc ssi H sgo.iiorf i ^Xiar •teHM&bfrB.re *•" i'rf&Jft «uble-0 nijrtB.Tiv .• ...•jisdorc biis. Xoow batuooe bns banaaXo'. anxbaXoafe' ;'?xado# biib looW- .XX •.• -o.^'x t 8§;ga bgflsris 10 elodw anxbpXaxs iucJ 1 835*9 baXib •an'xbaXon'x- .8333 ' .S£ . .naira/dXasaa bsitb «io tfesotl baa t 8J* aaortA-bhs bsXfsl assd svbd rfoidW eB9«rT (s)"- : -.i£ % q«Tj&;0i8.tst -©Jst/na (tt) bns bssasoo^ -isxtt-xul Jod-tod - - v-J-xXqe lo'-bslssq ^'•••Y'lsnraia bns % ezQ&' dexnsq?'. t &9v0% uoti-viStm oa\&amxe 9*0 aaxttborimoa- fcaialX ' adJ to- XX A ' i.(b6i*Tb%d9b Job) ' bai-jh ibsneqxi tbaJssimor ^b^G-i^iilsT ^"bsxiecw ( bssJBio'«8 10 b*»bi«»o toa. anrxftr b*£se Mgpfeaq A-^bssile 16 ' ^fisqqodo ft fi«&&»xdti jnimrfaalimaci ad oi b£ad an?v/ ardVoXXol sric!" ^bnsri ri'snlo- edi a®*' ' tb^+tf^elansR aisqo dead* aJcbdJaatdae esXdstfsaav bn£ axiail 1* A6&»fel$Rtttfl# bne is&lfcsSeqo , .«gnx«x8*Ixa «*© .3aiM894« 'i%f&*6fiitz*).-i:i,nMtoJ«o % an Wise ''Itfcfliaxe Jan ei 'iaolt < tS^*«W>q«Y® ianitB-ib^rfsfe' ? (e?.acoiq asaarfx Solap) •gnisesil ,$ttm*a \anx2fooXd , . (assq) anxJiiXoe bns igo^sSwWi i f Xib) gr.IBitc'ia -Xaoxnga. sdj ^c«J bsnu^es vXsbxv esw jt t avodfi - benxXjao a'anxball gHf WiA • ^Bdi-^baXu-: itooo- i yX^osaart 'itavawoit ^vs^m beX^sa fi rutf fgijiii Xbtx't • baaqx9 o* bsnataaTrii aad . ^ti^JmHlMifti exrfT ,tfqi«ax© oaXa ai vi^Xaoq bssaaib » . .yXdciabXanco ■ nbriqirtsxo 'arii 10 ^qooe arii a 9rii: .ta fesaflaroaeiro!) . ei *x mdtf \4 rfwfism qnr t iq l5 sxe el 'esisfifeoflOTOo ^qmsxe lo" noxuW«ibq^;-,vi;t ' aiff ni-.«e?ii .aoWqajaxa XsiaJXcdx^as, nd* l.o ayneoxlXrtais axf-oand'a' tbtsfs'-edf ■" * bsmoliaq Xa-raiXtfaftias Xasri- oriw. aftalnoab nto*6n; lai&^amwa* la ij ibnco al IWrttcfafl anibb la ^sariam sXodw ««fl eXdiggQqmi' ^i-todl-- avsd aaiixboranoo JMMg^ sdi£^ori !: 8* : i*>i s rtB3 : ifos-findo . ,'fe#«x£}?xaafcfs M^Xb^^ob-xqrtaxa' ?'8erfj : rijxt-r 35. The large volume of exempt traffic available has tended to support a large number of small trucking concerns without any ICC operating rights. But this same group is free to lease out to carriers who do have rights, and, in this way, they succeed in hauling a large volume of nonexempt traffic. This type of leasing has been of great significance in motor transportation. The exemption is under regular attack from fully regulated carriers and the railroads who urge that haulers of agricultural commodities beyond the first point of sale should be covered by the general body of ICC economic regulation. sasfil s t-ioqput oi bsbxjst sari. sXcfsXxnvB ollis** &fl*X3 5p efmloy ag-rcl- art? eiii H| fr^itt ap OOJ ^« raseoaoa ani%rrf VsHfemn aid* «x ,bns t ^ri&i-i svsri pb orfw ei«|T^p pi *?q 9^ 3 j 9**^ W>s 10 eqV sirfT Somstaoa f* 033*1 6 $gt&Sd nx bgeoaua |W apx^xs «f|C .noxcrs^occrtsiJ- **» n£ *mn>iUtt$te Jeegg lq «aptf 8srf gn/gsal 3 d -f« prfo ebso-iUfirr sd& ba& ctsxtibo ba^Ii/gen moil pstU xt£u$ei ' zefxw ft toSiiB *fea 10 *nioa ie-tfl etii bnp^erf esxjifco^moo XB-urctiuoQgs xp eisJxmrf Jarf* •nptcfB|w38!x ofraonoa? 0.01 lo *&pj» Xa.Ts>rr£3 arfx yri betavoo ad 36. V. The Trip-Lease Controversy Economics of Exempt Trucking The term "load factor" refers to the ratio of ton-miles of transportation actually performed to ton-miles that would have been performed if a truck were fully loaded at all times. The small truckers who serve the fruit and vegetable marketers of California depend on having a high load factor for their business profit. Since few of the loads available for movement toward California are exempt, they can achieve an adequate load factor only by frequently leasing their trucks—with themselves as drivers— to carriers authorized to haul the general class of commodities which are not exempt. Frequently, these leases cover a single trip only. How these arrangements have worked in the past and their uncertain future were discussed in a recent report of the ICC: "Trip leasing of exempt trucks by authorized carriers occurs only where two conditions exist: there are a number of exempt carriers haul- ing agricultural commodities from an area which the regulated carrier is authorized to serve, and there is more freight offered to the authorized carrier for transportation to that area than is offered from that area. This Commission originally interpreted the exemption of agricultural trucks 'motor vehicles used in carrying property consisting of . • . agri- cultural commodities ... if such motor vehicles are not used in carry- ing any other property or passengers for compensation' as applying only to trucks which are not used at any time in transporting other commodi- ties for the carrier. This interpretation prevented regulated carriers from transporting agricultural commodities in the direction of their light movement of general freight, because they were required to file rates and observe them and could not compete with the unregulated ex- empt carriers. When the courts reversed the Commission's interpretation and said that the exemption applied to trucks not used at the same time to haul exempt and other freight, it became possible for regulated car- riers to balance their loads by hauling agricultural commodities in one direction without regulation of charges and hauling general freight under regulation in the opposite direction. This removed the need for trip leasing of exempt trucks in order for regulated carriers to bal- ance their loads. This has resulted in a situation in the southeast section of the country— where the court decision was first made — wherein the regulated carriers are not handling agricultural commodi- ties to such an extent that trip leasing of exempt trucks has become negligible. In other parts of the country, however, the hauling of exempt commodities by regulated carriers has not been as extensive up to this time."!/ 1/ U. S. Congress. House. Committee on Interstate and Foreign Commerce. Effecl of Trip-Lease Prohibition on Cost of Farm Produce Transportation; Trip Leasing . Hearings, «3d Congress, 1st Session of H. R. 3202. April 21, 22, 23, 2E] 30, and May 7, 1953. Washington, Govt. Print. Off., pp. k91-U°2. M 1 1| tag|!&3 as&t s^ff Mm *rt* *&kmmt si hmsl-m mmm ■*>i&m& tim m mm m w&£& t§m Mr mm m h mz&ii^M* m *mm mi Am « ^mmm^ am&m & ■w-*m&U0 torn* mm*m mi. h&um* ma *M & m tt&m 2?hj ftmit v te*'&mui m&m *4«*mW k *& m.immm nttw kiam *mi ****** $f&m&& ttopm -m tm m'm m.iM*$6s Is &aib ikwm bt& te*h «is «i fesfeov ma *tem&km mm m tfm $k&& i e^ai rttfim «Mt8 If tiffin i ^ fM* Sf&ISkalb M *|hJ rat mm-io a *m mi $ ssito&ftoit* *Ii ^ iimtftfft*^ 18 SsHqto eftf b*m&$M>. tffioia&S -xiv3 i ; j to 3n^rrt§#,B Mt&eiq bSMtSS Hi &*» feattiiid* SfcWfli Bte? ifB:':} -;H jSa^^lfe m i^lJifjSsinBS E#^i£tfB|»tf RffM«Hk*ffiy fli&it sxii.31 ^t£^^ ^ wumi imm & &m»m jt&l ...^ s?gytsb ^ Itfta iiii 8v%§& PP. 33-37. There was a series of further hearings and changes in the proposed rules. See the current version in U. S. National Archives and Record Service, Division of the Federal Register, Cumulative Pocket Supplement to the Code of Federal R egulations. Title U9. "Transportation Part 165 to end, for use during 195h . Section 207 Lease and Interchange of Vehicles, pp. 99-lOij. 0* artai-rtft^^^^^ao ted totton** lift* vrt oMss^i o^sM jj smis !hfo*W *9#ttit§B fcff» fiMftit tot *l tb^^fe eft |%S ***** «jg» trtttt^g&ss gitifthfi- t^i«eD&T .^•A**** w ifctiiHMtr pm* nf j iwii-vt t%?v *ad «NHMb£l tepdj &»*| bos nttijfafyjtfr * a *«& BsJajgeovi ettoaa edf .tt&fe.jagsv i«g atom ao&« «tsa brig flo«>m tati Cii^t »«g scNsq jti ft| btaa&sq gad* S3* Stfft «wijj ^ertdi4fiXtr 3 ei tel U»*iM3(*89WBa dele mi atoi-fiso WiWbQftMdfl ^:l, " -.Iv:,; -;C"k£# O^'^ ^Tr^''':^^ T 38 it provides that authorized carriers may lease equipment provided with the driver for less than 30 days in certain special cases. These include trucks of farmers and farmer cooperatives used only for occasional for-hire transportation and the trucks of the professional exempt truckers in certain cases, such as when they have just completed a haul of exempt commodities and are headed back in the general direction from which they came or to their headquarters. Why the ICC Is Concerned Any circumvention of the letter or spirit of the law is of consequence to the ICC: first, because the law and the regulations are being avoided and the purpose of the Act thwarted; and, second, because pressure is put on other trans- portation agencies for whose economic health the ICC is responsible. Further- more, enforcement of highway safety by the ICC is at present made exceedingly difficult by trip leasing as the irregular operations of the individual truckers hauling nonexempt commodities under lease make them difficult to locate and check. Tightening up regulations on leasing and interchange of equipment also would clear up many ambiguities and make it more possible to eliminate some of the bor- derline practices.^ But, at the same time, the ICC recognizes that tighter con- trol of leasing will have substantial economic impacts upon the trucking industry. Other transportation interests are interested in the trip-lease issue for this reason also. The irregular practices of much trip leasing are a thorny problem. The lease of a truck fulfills ICC regulations if the truck is in exclusive posses- sion and control of the leasing trucking company. However, most truck owners who lease their trucks want to drive them too. If they also solicit loads for their truck, they are really contract carriers, and the law forbids anyone to act as a contract carrier without a special ICC permit, which these truckers do not have. One way in which operations by unauthorized carriers can be "legalized" is for the lessee to add the owner of the vehicles to his payroll for the 1/ See report of speech by Commissioner A. F. Aspaia, "The Future of Public Transportation." Traffic World , vol. 99, no. lit, April 3, 19$h, pp. 23-2U. ©di titbit bsbtvoiq 4n9mqJtssp9 ©s*©X yi*Si aiaxiiflo cs»siioT-*id doA arid- to eaoq-ujq -laifchofT .©Idxarxoqsoi ai 001 add ritlssd oxjttonooa aaorf'rf 10I asionsga frcidsd-roq yX^iiteeox© sbnin ina30iq is a£ 001 ©dd yd ydaisa gni$fc£ri lo dnamaoiolua t &iom aieafotf-xd Xfix/xivxbni arid ;.o ano^jsisqo leXi/gotix odd- as aaia#*£ qi'Xt yd dXj/oxllxb .jioftiio bos yjsooX od dXtfoxllxb mgf ©stem ease J. -xsbaii eaidxboramoo dqitioxarton ynirXi/ad bXxrow oala daomqiifpo lo eaiifid&aadni: bns gotxaseX «o snoxdeXjJssi qtr saxnojdaxT -lod ft& lo graoe odsnxmxX© Oi *jCetta«oq sion d£ ©-Jem b.is asxdxijaidta ynsm qx ?s©Xo -noo '.'©drfsld dsdd adsL-rgoosi 001 ©rid t wi4 omz 9rid &b t dxr3 ^aaoidosiq ©nxXi©b .r^aubnx yiMowrt ©rid OQQff adoeqmi: oimmoe Xsidifsdedirc avsrf XXxv gates 3! lo Xoid axdd lol straax ©3G9X~qin.t arid- at bsd-gsaaJni sin sd-£©i9tnx i9ridO •oaXs noaflo^ Kft .mXdoiq ^BWMtJ e O'ts gnxasyX qiii do.u/n 10 a©oxd-o.?!«tq tajj^mi aril -aaasoq avianXoxG ni ax iatnJ od* U enox^&Xbaa-x 001 eXXcxlul 4ai/i* a jo aa*«X 3-i9fiwo sloiiid dao.>n t 'X9V&ne!: .\-nsqmoo ^nxs^eX adi lo Xo-xinoa bna .loic 10I sbsoX fioxXoa oaX^ ^©dj 11 .coj aijgj -.viib oi dnsv STiOi/ii ii©d.t ©essX odu °- ^«o^£ta abxtfio: x«X Nit bi* t «tt»tnao d-osixnoo <&I&*t viz yste t Xtm* ixsrii ob vmtemi assrid- daidv t d-J*t«j OOI Xisiooqa « j;jodj±w isxTteo iWHto&o a es d-cs bastfaaaX 11 ad nca s'isxvxao b©$i«xorfi«»rttf yrf eoold-a-xaqo rioxdw «t ysv *0 .©vsrf den jhj toi xj.oif.t,q axfl w BS^^^dav ©nJ- io isnwo box cd- spsssX ©dj- 10I ax Oiidtg lo rmtet odT" ,sbcqg., fc j *A i&noxaaxmmoO yd doeaqa lo txsqpt saQ * X fclJ&1~U K l Uiq& ,4X .on |& .lo'- r t bXioVi pxllsiT ,J ./ioi^c'ioqartSiT 39. duration of the trip.i^ This employment is easily recognized as a fiction, particularly where the lease does not cover a round trip and the "wage" and "rental" are on a share basis. With a genuine lease of equipment, or genuine employment, the hiring party would be expected to return the man or equipment to the point at which he was hired and to be liable for a given wage or payment regardless of the revenue earned. Under the usual trip-lease type of arrange- ment, "employment" lasts only to the point of destination. Most of the carriers using owner-operator equipment concede that, after completion of a one-way trip, they assume no responsibility for the owner-operator or his equipment. An owner-operator might very well have a standing arrangement to be "employed" to haul cargo westbound on successive trips while the eastbound traffic arrangements were strictly the owner-operator's responsibility. Several midwestern meat packers have made such arrangements. The refrigerated vans, suitable for meat, are also ideal for eastward movement of fresh fruits and vege- tables. The truck owner-operator solicits business in California, perhaps through a truck broker, or makes arrangements with midwestern produce receivers before he leaves the Midwest. On the westbound hauls he is an "employee" or under lease, and, where the eastbound hauls are not performed under lease to the same midwestern shipper (as they usually are not), he must make a separate lease for each westbound trip. For all practical purposes, he is acting as a contract hauler for both eastbound and westbound shipments. Effect of ICC Proposal on Produce Marketing Marketers of California produce are interested in the quality of service, the volume of transportation available to them, and the rates which are charged. 1/' Other practices are for some owner-operators to solicit business and then arrange with some authorized carrier to legalize the transportation through a trip lease, the revenue being shared. Another arrangement is for the owner- operator to "purchase" the cargo, pose as an itinerant merchant in case he meets an ICC investigator, and then "sell" the cargo to the consignee at cost plus transportation charges. The ICC finds these practices, when skillfully per- formed, to be completely uncontrollable. It should be noted that these subter- fuges are an outgrowth of the near impossibility of an owner-operator's obtain- ing a license for a given route, the ICC and the Act serving to restrict the number authorized. licenses are granted only when public convenience and neces- sity can be proved in a hearing—which is very expensive and in which those already operating the proposed routes undertake to prove that they can adequately handle the business and that more carriers are undesirable. Further, licenses tend to limit the geographical range of operations more severely than would be practicable for single-unit owner-operators. (See the discussion of these prob- lems in Interstate Commerce Commission, 67th Annual Report , 1953, pp» 55-59.) fm ?! 33BV» feefSt fc£* qflsf B J OC 8©Ofc 63S3I «& at9 tf* 3nMn»3 ig **aamqxcrp<« 'in m«£ e*b*Sto| b r#il- : »aieBd &%iri« i is «« ''ischial inainqiupb *b nan fed ] nWs"i 6i ba^qfca atf bisow WtMH Sd* *iha^£qt «fs baitd a«:r ad HbM» #s iiiidq fe& ©i -s^ns-xTB '10 gqi^f aasal-qi-i* Xsme arid iabdti nflfiriiHi ajjitavsw ed* lo aealf?iaj. , 3*i b-wMtso aitf ftft febM (iiiiplM lb taloq U %jbm eiEBl ^ tmilHH i&fcri jjg£ft xe^fW s Id ndi&Xqmod mrls (jM aBabnab ^amqiirpa 7b*BiaqS--tariwti tfjkft cJn^iniqiup^ aid *ri io*BTaqb-^sftwei arid .tft41i£k$ lb eiai-a^tsM kbsaiadb a'Ts doxdw ea.+B-i sdi bna yftari-J oi e£tfe£isvB 0*W**^MB%rf lo awXfrr ad* Tsoi fSi» aaai??< » baxxiodJii-B ai : f sift ^3ftBd£ qf'iJ" la drixisdidqanBTJ' nad.t Bixa aEsnxsi/'d .-txcxloa bJ s'ioi-Biao^^amio tj fl rfyx/oirij noj-iB^toqarisici arii baxlBaal b-x lax- -iartwo ad* nto! ex tttfiiitjqiiji';iij -ieri*oriA .ba-i; acaara ad ^aab ni dosdo'iam snziscihi ds as aBbq i sx.'Iq #ebb iB aenpianbo ad* bgieb ad* *^aq ^tii/liXiaia iHri?# eaasxirip.TC aa9d* ebrii't -i9*rfif8 aaari* fed* fia^on bcT b£i?rda *I .arcKXib-i -nxBido a '*rdiBiaqo**K>mjo ntt to ^HictlaBOqifti ifl^n aif* "*o di^oiaif-trb na bir 3 r -)fi'' rJ^** ^ srf* fcte PDI adJ a#r^ a §1 aadaaii a in -esoarf bnB '4onaknavcth6 bitcf;-/q rtedw Vina ba^iiBi^ a : ir- £#r i! )" r jhiv^l-od-'"' d r' sa^d* ddi/fci ax biift s^ieaaqxa ai ifd-lffw--8njhcsall a n£ J'ii'v^^ &d mi) ?H.t i8JBi/pa/jc aso ^ad-^cten* fevoiq oj b^ei'-iafiaL' Si^ijjbi B^aoqcTq afltf |8f*H#q*5( ^ss^Vil aaaqaoxl liatlrrai^ isffe'iEaetiiii aiB eiaxi'iBS «%t)ft vteri* ftis feaaa^r»w rrarf* t£9f"avaa S«x6fa aadfefs-ja^ le bS'-tei i : aaadi la nofeat/ba.fcb 1 ' 83S) 4< ■taihl dr ig#i ho. All three would be affected by the trip-lease proposal. How great the effect would be is hard to tell since neither the extent to which the present arrange- ments would be disturbed nor possible alternative arrangements can be known. For that matter, our uncertain knowledge of the present trucking industry is a major limitation on estimating possible future change. If the authorized carriers cannot trip lease the trucks of the group which hauls exempt commodities at other times, they will have to make some other arrangement for their trucks, and by doing so they will deprive this group of a large share of this revenue. Naturally, this will reduce their numbers and in- crease their costs per trip to the detriment of the fresh fruit and vegetable shippers. However, a substantial proportion of the truck transportation avail- able for produce would not be affected by the trip-lease proposal at all. Truckers who now restrict themselves to exempt commodities at all times would not be affected. Private haulers would not be affected (other restrictions prescribe trip leasing by them); this group could continue hauling exempt com- modities legally and could remain an important source of agricultural commodity transportation. In addition, often truckers who at present do trip lease would be able to take advantage of the provision that trip leasing at the conclusion of an exempt haul is permissible. In addition, the authorized carriers may be- come more interested in exempt commodity hauling, often as ayneans of increas- ing load factors for newly acquired refrigerator equipment .- The quality of service rendered by the independents has been shown to be unsatisfactory in many respects. It would not be improved or much affected by Ex parte No. MCU3 except for a complicated concern of the trucker over the proviso which would permit trip lease so long as he had just completed an 1/ General operating practices of common and contract carriers, adapted to the~handling of nonexempt commodities, would almost certainly be carried over into their exempt commodity operation. Many common carriers view the business practices of the fresh fruit and vegetable marketing industry with unconcealed distaste and would be less satisfactory suppliers of transportation for this reason if for no other. These carriers have financial strength to resist rate cutting when their equipment is idle. The authorized carriers habitually ad- here to fixed rate schedules and would likely continue to do so even when not required by law. m iodiiZ adi iaatg ti&A »Xfiaot}dfq »0 « i tf "(yW teg fcsioalia *d fcXfhJv ilA ^anirtw 6H* HbldV H# ***** adi tsilfien a-mie XXfrf W bited si ad bW jnW6n£ §d riss airi-h^s-Ha ttiNMNMfj) aXdXaaeq bsditfiaib So 1 biuow ittrftjnr * 62 tr*e«fcni ga-fefoifW idaeaiq adJ *t» agfiaXfoboji rixBchaom/ t *a.fian Jarfi ^o*? issjnsrib aiitful aXd'sadq 32&#adfeJ^I £8 noifsixmiX io\-m -qii6i% ad> fed arfouii aaaaX qiii Jon»tGi> e*ei*%aa JWitodtfi/s arfi It •iarf^b «p mm ot ov&n in* ^gm &mt u *mm**o i-md mm ■ lo tqmaxa rii fca^aaiaini e^Stt aiaba -kiitafhqii/pa loih-iasjMa'i baiXcpoi ioi aieisa'l bebX grix ad oi mrorfe nal»d eBd einatasqa&fcj iki Wbnat ebiv^aS lo vtMsup drfT Yd fiaibalir. rfd«& id bov^mi ad *ori fcXridv il .a*osqaa-t V w &i ^dslsiMi aifi i3vo tajbini adi lb n«?noa bache^Hqmoo e -ioi iqadxa td^i *6tt ai^aq x'3 m teUlqmo isu* b^rf erf ae anol fta aasaX qiai ihtriaq b.fwow dsiritf bs r^otci bi fcaifqaba t a*iqi:TiB6 ioaiinoo be -•bp. 3ari qqifg li -wi fidiJai-iaqatie'xi 'jo s't risih? fiave da ofe ci awniiflda 'dtedlH & ; IbriBd""adJ ttrnX \rv? bd^ftrpai: exempt haul. Truckers would be particularly anxious to avoid completing non- exempt hauls into areas where exempt hauls were not available. Effect on the S t ructure of the Tru cking Ind ustry It is clear that the limitation imposed on leasing will force many car- riers to acquire new equipment. Having this equipment on hand, the authorized carriers undoubtedly will seek out means of employing it during slack seasons. The repercussions of such a trend are impossible to evaluate. The motor car- riers will seek out new traffic, including some not previously considered profitable for truck transportation. If the trip- lease proposal becomes effective, the independents without oper- ating rights must eventually be reduced in number and develop new means of oper- ating. For a time they may restrict themselves to exempt hauling. Temporarily, there may even be an increase in the number of trucks available for produce trans- portation. The major reduction in numbers would come through failure to replace worn out equipment. It is, of course, problematical whether the added restric- tions would cause private concerns doing their own trucking to shift to other means of transportation or to expand their lines of business to make good use of their vehicles in both directions. Contract and common carriers would likely make inroads into private hauling by virtue of a 30-day minimum on leases. Exempt haulers who were forced to restrict themselves to exempt commodities in both directions might compete where they have not been important before (East Coast fish to California). Agricultural commodities now shipped into California by rail would be likely candidates for truckers to substitute for nonexempt loads. In general, the most important sources of rail shipment of agricultural products into California are the Pacific Northwest and the Midwest— important markets for California fresh fruits and vegetables. vaam •©■•ji**' XXiW .grrP^'noX- rro bse'-nwl "aol&a&fr ■ '*! erfi J«rf x wo«r 3 »f~tr ' ■ ' | ■ • ; . .... . ' ■ . ■ ■ -•wo -rctfo* srfT - ^tjgf^ftv© ^ eXalseeqmX sus.-fcris-tf * rf^e' Id em>ia8i«'t«»q©* ©rfT 5 . - ■ ■ •. ....... ■ - . ■ • . . • ...... ytcls>d Sfifittoqr.t ne»*m Jo.T ©vsrl Tjetfi ©-isrtv' eteq.-aoo Jrisi/n 8toi«tofiffb ifobd at tfflO o^it bsoqide con fesXcrlbdmrnoo L^ivSiuolt^A , C-sinTjIiXeO oi- rieil .teeoO- i>'(3Xdnrtrt ' *rnl ecftf +x.f edt.r vrf ' .Xi %0l ;:,tS5, r i^r t Jne"ji^Aa-i~-,tPft«hrlsf t>H.* h iittoA erf* ete sitf'xolxXB'O L U2. VI. Why Trucks Are Used Instead of Railroads There are many explanations as to why trucks are being used more and more. The economic advantage of the shippers is the key, but a complete analysis of the advantages would be too complex to undertake here. We can discuss some factors which, although not necessarily the most important in over-all trans- portation policy, are special to fresh fruit and vegetable transportation. Other important related issues, such as whether truckers pay their full share of highway costs, have been avoided because to cover the necessary points would take us too far off the subject of produce transportation. What Users Said A large number of fruit and vegetable men reported that usually it was not entirely the price but also the type of service that truckers gave which inter- ested them. What these men reported— and some points were reported over and over __indicates the advantages which shippers hope to get from trucking. The disadvantages of using trucks which they mentioned should suggest to truckers how they could improve their service. Claimed advantages to shippers of using trucks were: 1. Multiple pickups and deliveries can be arranged with trucks where they could not be arranged with rails. Split and mixed load arrangements are often taken by truckers without extra charges which railroads would require. 2. Frequently, a truck can be obtained for loading more quickly than a railroad car. 3. Fruits and vegetables shipped in trucks often arrive in better condition because of speed of transit. U. There is less mechanical damage in truck transit than with rail- road cars for many fresh fruits and vegetables (but not all). The expensive stripping, bracing, and heavy containers necessary in rail shipment are not necessary in trucks. £. The regulations of railroads concerning irregular containers or methods of loading have no parallel among truckers. Since irregu- larly packed produce is often available at bargain rates, use of trucking may permit a business advantage. 6. Claim adjustments with truckers often can be made on the spot while the process of claim settlement with railroads is involved, drawn out, and less likely to be favorable to the claimant. 7. Price risk is reduced by shorter transit time and the decreased possibility of a price change while in transit. 8. Rates are lower. -smm -bos oro* oesx? S nxsd »tb KfpBtft •* as ^Waoafcpca ^aam s« e etBOa aso aW .«rtad etfotatatr x^Xqimg ocJ- ad fcEww p£pj£*«i| -9a&tr L£&^x»vy> mt Sos'Stowi team erf* ^Ix'rsss*eo9a $aa xJjtfiotftfB ,rioW» ITOftWl •ttoiAfi^o^wtf aXdaisgav brta Aiinrt daa.v>i ot*.t sfcttoq md* fcfts--b*fctoqs«: Bom saaricf «•* ,a»rfj faactea Hit .aa&Coci* mrA *n ft? fr*ftd arraqqida xfoirfw aaaaiaavb* artf niJftljftfl> .Mill, aralou** oi ^eassxra bXxroda banoIAtaa ^ed* dvltto eufcKrc* gotoe to ^stfwfeBaib .eoivrse ixad.t svcTOfrti jX:;co Y»d* worf :aiaw anoint sn/stf aisqqida oS sagsJitevba beateXO a-rad / a^qptrf d*X*vr bo^asiis ed a&o aox'isvxi^ bna eqioloxq aXqUXu;.; ,X b*oX tr.y.m IBs tfXXqS .aXJte* dixit oakums ad j-cn bXooo *adi Basifldo p-rixe ixerdiiw atari ox/~i x<* oasJarf «aii«> am a^nsmeanBtiij « attics** bXi/ow ebaatXxat tfftlstfw nadi xf^atwp ©iom ^tXbaoC 10 1 bartisJtfo ed neo ^oi/iif jb tfL&n»ms-xEiB'i xo «f$ .> *J$9«?* aatsx?. .a-xajioiT'f.f 90001 X-sCteiaq on av^d gfjib*o£ JO sbe^a .0 331s K zoJs-i oist^tAd aldaXjtsT* as#te sX aox/bo^- ba^ojeq '•aaa>tO£vba aaaaxaxrd s j l xxa*i9q ^sm ssikoxr^ {# sri,f BO •OOB ad nca na^flo ata?loi,^i riixw sd-flam^ai/tibfi uitsIC »d ^bavXovnx ai abao*tttrs ifciJtw ^M£#*h otXaXo lo aaeootq' o&t aXxdw * » y^>Wt9n fp«M »i$ttf» |f&fe*g e* frXda" la^ed absoiCXis?: bcs-r?aXe89 ISffiS^J. i?1 tf^^W* Iq a .*qX Jteoxjteo aarW aaeX qirfe o* elcfco |P B-wntfsoes t m^d fy m 9ji# ^oXevsb anx^oi.-t* e»»V98 \$obk tao 8 qa tfXIqV bPYXPpaT bfioTtiBc ifew « 10 tolJq^lb tfoutf IbooI .©nll'l^ai snsa o4# etc ad ioq ai qoX*8?r«qe Hp*/** Y«b-#a9B9'?i ♦o?Is anoXteiimiX eiX a'j;d" 'si'xjioffjjp *Wn»a Jte&VXSit. f$ at gjiHXea ^^S**Qfl fc ^Xoy/jna^aX gdtf oj n &?:t a V Ad .a^iflin aa^ ?3" '»st1^J ' i |fw©5t weso qagtsx'B' to 9fff ItQ epA^aX'aax '^"s?!^'? '^p-X'^Tte Bv + BX" , ;;.i "^ffB8 , epac lip* b??r^s ^ «d acXbaoX .ipl d-ioqrt ion pb »ie#xp Mtflptf .5 ||^HJ* «^?ri^9 r ,jprfn .^KRBfc* fVJS|f iop oh titkmup*£ ?«wfaiff U '•$^nro% '09 kh. U. Trucks, more than railroads, have delaying emergencies en route- such as accidents, breakdown of equipment, action of public authorities for traffic violations, overweight, etc. 5. Icing facilities for trucks are not so widely established nor so well organized as for railroads. 6. Additional precooling facilities are sometimes necessitated by extensive use of trucks since adequate precooling is particularly essential with trucks. 7. Truckers will seldom permit their vans to be used for temporary cold storage in the manner in which receivers frequently use refrigerator cars when storage facilities are crowded or loads arrive at inconvenient times. Truckers usually insist on prompt unloading. 8. Special loading facilities must be constructed where trucks are used extensively. 9. Lack of uniformity of equipment is more of a problem with trucks than with railroad cars. Some disadvantages of using trucking affect primarily "front office" opera- tions of shippers and receivers, for example: 1. The financial responsibility of a trucker is often uncertain. 2. A bill of lading issued by the exempt trucker does not have the same standing as a business document as does a railroad bill of lading. 3. The irregularity of truck transit time means more uncertainty in planning day-to-day business operations than with railroads. U. While there have been relatively few claim adjustment problems with trucks, the uncertain effectiveness of legal procedure and adjustment systems is a problem in the eyes of many shippers and receivers. For example, most truckers probably would not pay claims based on loss of market through unexpected delays in transit. $, For receivers whose business establishments are in terminal markets owned or controlled by railroads, to use long-haul trucking exclusively may be awkward. 6. Failure of truckers to adhere to published rates means that rate bargaining and close watch of truck rates are essential. This is a business complication avoided by using railroads. 7. There are no diversion privileges with trucks, and often there is no way of getting in touch with the trucker while en route. 8. Truckers often will not accept certain types of fresh fruits and vegetables. For example, wet-pack lettuce is disliked by many. Transit Time Speedy transit is a highly Important advantage of trucks both as a means of reducing price risk and because of improved quality of the fresh fruits and •o$» ^;-L$iei3TKRrcf ^anoxisXoxr oxlxcxt tol 3eiii.to.lJ3s. 03 ton bodeildiz&sis xXabivt oa 108 sis erfotrcj to! aa-JLtiXtoa-l %alol »sfcr,otr.xat to'i as r>9sxrt£-sio Hot gtf fcaisixseaoen aeastoS0i» ats eeJWXIxoal aniloooaiq Ximo.fcfib.6* Xltslroiiisq si gaiXoosstq ateimobs sortie b&jf?$ lo 33^ erlwaix© •etfomti dtxrr Xaxtfna8S9> vuyiyjrzaf tcl bo8U sd ocf arunr tioli iifc-iaq mobXaa IXxw 3i3>loxrr? ®sa xt^oi/peal atavtase? dafafer at i&nzsK adi «l t&&«xodts bio© ibft$£ to bahv/oto sxa z&t&Uias'i 0$ft*o& xiaxfa atso to-tst^sitlot no -*''Xeax X- r X*tfstf vtaaLwtt «««a& tataavm&iS fs avi-its «3nxJbsoXn» 9t0 a slows* sioris be#omt*9ae» ad Jaxro aoiJxIxcel anxbsol Xaxoaa. 1 dtt* Etsidotq £ to 91m si dn&Mjixrpe lo ^xmoliau lo :iojsl •atso bscti'xin dJ±w asd* -staqo "aoillo mm XXztcmitq ^oalls Jftfetwni gtfss lo ea^aavbsaxS araoS •. af g jtmq i tol t etdvxso3t bne araqqlda lo anoid 'Wfa&fr ax WStett* s lo ^xXidzenoqa^ Isiooxoi'l sriT ,1 asW jwyl cton aaofc tsjiout* dqraoxs add baxraai §nibsf lo Hid £ .s 16 xXld bsctlic-j £ aaob as daarwoob aaeoxacrf a a* ga&as& sraea •SffibaX if ^dftUd-sofMUr ©torn enasm B«W diseatd itoxrtd % x&i-z&Ls^&vxX adT •a&aooXle* d*xw /tad* aooidataqo eseflxai/d ^so-ocM'sb SttcxaaaXq amaldo^q Asa.tiJBirf.ba ."ttsXo vrel v r r©vxdsl©i noad evarf ai©rfd ©XxdW baa stabaoou? XsgaX lo aaanovidoa-l&j nlad-ison* ©rid .a>!oj^t dixw iSi ataqqJtda xttaai lo sexo erii rsx fflaXdot? a ei Bjaa^exa ^i^iffM taq d-ori bXxrow -sfdsdoio ataiojtni Jsoffl tfltfqinaxe toi .atsrisoet at BTtSiab bs^osqjcenu xfax/oidd- ^stsm lo saoX no Jte&ftg snlslo •d-xsnstJ' iBaiiirxoi? ni. a^nftccfeXXo'fsJ^e Baenxaxrd oaori-7 vtsv^eo&T left Xxrsd-3aoX ssif o* t «bao^i«t ^ fcaXXottnoo to bemro ai^tfim ei*t feic? aaaeffl esdst b&daxXdaq oi staribs od- a?e*W»%* lo srti/XJLG^ .a aidT iXaXisosac ats a**at ^oat* lo dodaw oeolo L>rt£ aax-tiia«ed .abfcotfxAt SffJta? X3 bsbxovjs aoxw^oiXqmco eaauisad £ 3i ataii nsiio btw t B>Ioi/t^ dfiw aaasXivxTi ctoietaVifc o^ ets stadl .V »p toot us eXiriw yafapst add rtixw douoi nt ^ix^as lo on aX bin ««tfti daatl lo $»qfit fUafrfes Jqaooa #oa Ubr n*no vsmbmS .8 .^bh \a fc9;IxJaxb ax awtSsi. ^oa^t^vi ^aXqmsxs icT .eaXdaiagav 10 ansae a at arfotnt* lo as£.*a6Tbs ^ mJ l eqal yrd^iri a 3 t .txana^ ^bttl»$B bits ttteil ttewl sd* lo y;d±Xcop bavotqisix lo sauaood boa jfait aoX-xa ^.tioifiOat 15. vegetables en rtnL How ™* trU * B «" ^ **" \ great deal upon the trucker. With many, times en route are somewhat irrefalar. Generally, truck schedules approximate railway express schedules.^ while evi- nce on L travel times of truckers is scanty, information from truck brokers, shippers, and receivers on the number of hours which can be taken as the rea- sonably certain maximum for truck delivery to various zones was obtained ar»i used to prepare Figure 7. ~Rates inevitably attract more attention than any other single point. What rates are charged and what incidental costs must be included in figuring fetal transportation costs are important to all shippers. They also consider differ- ences in services rendered, so direct comparison of rates alone is not com- pletely adequate. It is not possible, furthermore, to obtain completely satisfactory information on either rates or services. So far as the rate part of transportation costs is concerned, rail trans- portation charges can be determined precisely by those who know how to interpret them in the published tariffs. The California Grape and Tree Fruit league's Transportation Department has summarized rates on deciduous fruit from Califor- nia to United States and Canadian points. Figure 8, which is based on the i/ p.n wa v Express service guarantees fourth-morning delivery to Chicago, 1/ Railway Express service & U *V daliverv to East Coast markets, Minneapolis, and St. Louis, and fifth-morning del ivery ™J£ S Railroad started except sixth morning for Boston. On May J«#Wgj *J ^ov e f rSS and vege- for departure on eastern trains. For this extra service, there is a of SS-Sn: relJKfore sSpmentYs Xg^ST J» must be for points which are no farther west than Kansas City. ^ing 0*>e and August, ^^^^^^Z^ -ST trains and were generally reported to ^™ ^iv^ in g a comparable service. See further discussion of Santa 1?JW** ™ ■JSEZtiSEtiR * Bureau of Agricultural Economics. Marketing and lransporxa __ Washington, Govt. Print. Off., October-December, jyw, pp. 33-3U. | ta« «*O*W0 w ,«,« aJ ^ oviui ^ to* nts , M0 , :£dMC5 Ml .tato, RlSats ™ Wo MM ncWBsij* , w tM7iit xiatttrw ,, ^ ptfefcl*, o., ,>*w g WM , B x« SBOq al „ WWW mi *tMl « MM mMh* m**-m«. "* 80 *"* B! ■» M HMOS b**laS o* *!„ ,Bw f ■^ Lf n - 5 r!? . ?fe-1 •scicroiiocl Xs^«i;ox«A So i«mhiq&>ig aiiteae'sq k S*m* cHIbtt e'exmeeJ boa Wgietl f»d*^££t»si> to x*rf ed-i ..qant B.trfj sninaqeiq ill .c^f ^ ^6 H8 ea5xdxfcnoo X*6*q^ ^fifttl lo #306 ^bmrbq 001 naq e*H oJtesrf arfj tftebttCaai eia* asaisdo Sfcbrcifci frtabaa^ to idea g 16 tedo ^oi^f-ris* ******** ^ IT U.floiifi*xoti a n«t* flc xa* ism a bos. is*t*fe 6 e-vrgfi t fc9tebi6 saw gdXdXaa fc, bai*' ctae*el!ib a 11 id bee* sts* "noi^t^^ ^Icfiaao:! aa email rioaa ebxfX&i* .ten asob &m B :if .SnB-tQlUb YXdrf 8 Xl s erf hlaaw i^o odd lo aoteiem **3ze ibi ae^sdo t ee*tEda frtds*** ^-zedo soxXoooa-rq .si.'ob'.^ ftp aiad §aX*Xod tol ass-isdo rro ,9?:;oi fie a^exfe a'rix© * + ^ CBOSd ^ £an 08 f^eswtq erf dortnao aotrtf *oi#*a*oq***rf ab a «ta! -*alllb Xaxd^dad;:* 9i 6 o-xerii ferfl smooA U n .baaxaddo ** &oivibo adai oiaarf waae^lttfi eeeiT .e-iaqqlrie aaoilev bxaq aedai add „± ft ao«e ^diXitfa &iinlii$TBd % Bbodtem aBeaxebrf ^neaqiiipe aoidad-xcqena'rd lb ^majjp XXXaaoaa« 3 fW* esda? anXtfoirsT . s ba«i aiiie^ns^ Xaadtatdaoo lo eftf srf.t .SaXtfoxnd- lot baa:** brt* y^* io ^#^60 sai^arto lo dXaae-r ^anralai li-jiihebX-labo sri cd ^odd as^l add wbiaaoo a-sqqMe ^ftai aXX/ft' aaDiierfbe eia* bsiaessire barfsJtldxrq OTa rf eeXaaega sa^orst Xa**9a |gff eB&rf,t 0 r h« ^ 8 dai-'Jw 8a*et aoife^ioqeaatJ XJ&* at mil erfo I liZU tfyJl ° q T^t ?B& ^ 6 * * a9 «?- £ ria tol rcerfsxrf ai % Caiwi4 8 ni ^xmv ari^ ir>l vlxXfix$> 0* b« liape* iifeieif aannXfiir? erf* o# bobaoX aS ^is'i SoSi trrV -* f"'" i " s * ?22 W v? I a -taaatqeda rio'l aXrfaa^tsdo sdai ftoitacf'ioiiasa'i* *eewoX si obdijoq 000«i£ lc» sMe^Xfie tEno fcbakrfrfb gd bx2oo ^2*1 BWf**x5 ^iofl si aoaa^ ed? .aiooiXXl W aboiroq 60Q K dl lb if^xew a beiatreaa avarf eW .a-ilibM a-rejaas oi be*»vlb ad aso tedS da hvso feaot p| H eoiiSalq Lauati lS3» ♦ 1«*8 i it ddgiatl nX vi/anaq a aotbtei #»arf*i# gdaX^i FIGURE 9 General Pattern of Estimated Rates for Truck Transportation of Peaches from California to United States Points as Quoted by California Truck Transportation Brokers in Cents Per Lug, Summer, 1952 Additional charges, which must be borne by the shipper or receiver and which are not considered in Figure 9, are for ice or mechanical refrigeration (usually about $2$ per trip) and the 3-per cent transportation tax.*/ Comparing Truck and Rail Do not expect to learn too much by comparing Figures 8 and 9. Point-for- polnt comparisons between the two maps should not be made. However, while the map of suggested truck rates is of limited significance so far as actual rates are concerned, the shape of the contours probably reflects fairly well the geo- graphic structure of truck transportation rates, and to compare the shape of the equirate contours with Figure 8 is helpful. The geographic pattern of truck rates differs in some respects from the pattern of rail rates. The entire area east of the Mississippi takes almost the same rail rates (with slight differences due to added refrigeration costs for the more distant points). However, truck rates continue to increase substan- tially between the Mississippi River and the East Coast. Truck refrigeration charges also increase with distance. The absence of a large area in the East where truck rates for shipments from California are identical, such as exists in rail tariff schedules, is a real difference between the structure of truck and rail rates. Figures 8 and 9 are consistent with common opinion about truck-rail competi- tion. Within the eastern flat rail rate zone, the railroads are in a relatively more advantageous position. If the rates on which Figure 9 is based do over- state what is actually paid by about 10 per cent, it would appear that trucking has a rate advantage as far east as the range of states south of the Great Lakes. Yet, trucking does not compete effectively for shipments this far east. The favorable position of trucking in the Southwest is indicated by the bulge of the contours. Compare Figure 9 with Figure 7 showing time en route. There is a marked similarity, suggesting that the relatively low rates per mile 1/ There is a 3-per cent federal tax on all interstate truck or rail trans- portation and a 3-per cent California tax on intrastate transportation, other than purely local. Tax records do not form the basis for any good statistical information on truckers. The federal tax is collected by the office of the district of the Bureau of Internal Revenue where the trucker has his principal place of business. Truckers report only their total revenue from taxable service and amount of tax on a quarterly basis. There is serious question over the completeness of tax collection in any case. e.'i^ o>M» E4& aay.«fe?p:i xs-xtxcis ..§0 itf fgf&tj ad Jet/a) rioia* ^tfjiaatfq ■$XXax«3a} «j? »o ig| au £ e^re.V5 «X ^a#£.saaea is>» - . .^#M SB W8Wf* > '* fails (siai jj«4 e# allri?/ jisv^pH ,aea» s.d *<$ i>X«-ca*a sqaai estf ari* ngawiasf jg|$«4$tqpeg .^igq S^M'iJ^S* «§ *i? fea.*fcnU Is ci eata* jJoasJ fsgfresgBg 3© tapn art* XXaw ^afca'.. a^asX-lte^ yXdaaoaq cwoAripa 'i« eqfarfa arts tbaoa .»$opg a?a acid %Q acrarta o;f.t anaqsroa qS but t s»4Jk.i noi^i"\.v,:;-tj >'s,-v V i-'-.torf** * ^"jura jJrjt^Xad ai 8 aipsi? arjgcijJaoa ajaiiggj; arf4 fflo-jl ad-oaqeaa q?s>s fli a«?*«* slain* 2p A^taq aJrfq^oa?, aa€ atii #aoK-Ca saiiaj Avjzt&izaM gctt 'la #aa§ aa%a a-xlina &1T .aaxs? Lts-r ^p xmi^q sl^po fl^a.'ta^LTfia':? ijobba p* aafc ^aoaa'salixb jMgXXa ittrvj) aaSa*s Sinjsa ^4«e »8B'5MjU p,* Sfifsxi^qo apJas aXHW* ^970^ .{g-taloq Jaaj^b a^oia ffw#s.-f.f».?i;-il3'x aJ^jwf t#faQ JaaS adJ b/fa .iay±fi J^ispir^i ad* fiaawi^f ^X^i# |S9g aria oX aais .«3aoa a*ejy XXa-'r n^^eaa arf-i nS0pf t fXd* pb si- ? rfaJtrfff no aa*aa aM U ,aci^aog f&o»$zt n&rb* p iof, Wti&Wit 'faaqfja fej-«o?/ *i f .f?i«a aeq fi£ jtoorf/j c-^aq \x£fiud^ zt ^rfw a^a^B • sa ^X jfa^tp a# %o aVf^aa a?*a?a U aagat adi aa *sa*a ?ai ea aap./a/ybs ©ia.« a l^ jfc i «al airfi a^axi^a ^EayWaaria Qj#*qs»a ton mud) fjffl0a&# t $pl §«X-- Wt*vi§ ? a«B§X? rf*iK .? e^wsx'-f a-xaqmpQ ,a/§«^n§a aa'f -t? dzh-a. tt^i aaia? woX ^Xavii^a'X pd& »Pl#«i89ffl ^ttTzlteia b&tw a a? a'j^iT -eaa , *# Xi.a-? qs ^oaa* =^ai?-iaini fia ao xa^ Xs-wbp-i ; Jnva «sa-£ a ai y «-9rfi.o <3o*ta.'Hpqf8/fBrx^ eig$§fpt$itt op «a.# aiBPtaliXap #aao ^sa^ § aoi^^tr^j ^i 1 ** f-.a ap^A^a-ja/^f ^d adit>^aXXaa aX Xa-tab^i aJT •a»ja / jiaiif , 'xi cq xcoX:*afi)Kto , laX JT^ipnXqq i; ci ,a>ri- arfi*: rToijasaf aa^i-'xwxv, p'jp^f ,BXas}s.iiu6 ip : f /?jfc$st asc.te'X&qo vioirxJ t'ottiv,. bio gao^-* -a? *aepO .*sajf ad,* <<* be-JS'iQsx.'iliji ad*/ fc© a§rviaes:xaq agial a 4g«a aaadw s*089aax&Va*wJaa adT r ^ &ftt$£$ 1© ax/q^aoo sd* ^cf fffifflffrfry oaXa ax ^38**aXs£5p $$a#$$ift ba& ,,a«3rt»S aw*e*8 t^wql aad* •x.jdgiri, dAoa*, anp ^foo atfasc a. aad ©sag ,as>aa4a£b Tcagaol dai'^ s B*±.-«3©b E'xoiss'S s adij -adTrcqaaa'x* .f.xni -re }jqx/'i4 xo a$i*o»Xaa ad* gciaaeifllai atrc^paS i9iJ*q $Bttl aesaiaavbs *xo o* ^io|.4s^t*jq $a_a3i .saeqqlde ifd ^Xaaoiasso© baaox-xi^a 929*? aoii sol biisfiisil t x|.«|*i*agM08 9#b> lo agba ad* *a£fL'i bailo rioxdDt- eitoxJat* 1© acxeaaqxa eife} o# bs£ ^sd 8|X9>3qjbi? i asr** ~ 9 f[*^S_J.;*£l^ii£ &? ' 1 ^° «*"*3,fi no sdxifoj/a* aviaaaq x^dile aaa* 8j.;| Qas^Ma le abi/****© Xaaaae^ ad? .gnxi-'-juTt Bpabo'sq jsi ,sab!ai/n* n.f .ici8.iJ9qxg saarafeana o* £©x*aaK©aiel§ X Asanas b 1© aaaaJaiaaa o* bapX j©Xrfs«cx#©o^fl(© qfiyw asJoaa* *ad* baasX&ab ne*lp eXsx;^ saia'xr aaaqqxda *ad aapoabaad esaalaad. faaqx*ibba. baaasa boa t*asj&3va©pni aaaw t e*3oq btJbba ?:'al 5 t'xavawofi r Cc.A*a8sj20 qaif rxisd* sbaai 3oi*x*aqina.'0 ip etuaaeaq ad* *ari4 -xxqo "f9 t &Aw:d la ozv fcoaaanaai art* ai a^idJraaf-jqqqo naaa avad aiaqqin's wal aa©rf* ^awx* ^d a/sgpi-crfs aiari* sviaoor: 0 * jfe^ ©i&r a-i^vxaoa* nc? &a»*a**aa,3 .^avi-aaatqoi saaslaud rxiau* b&fcnaaxa ^74-1 S e£ ^xXWxaaafleafl i«X©Oi»t}i? vrfr -fujan ba^JiaxiX ri^iw aoa^Q^i o| .":3*ifiq tiaili snia§iea.oo at fcaylpyai isxqc adf §«xa« ^aaxQ-sa rratsf,-! a aa axaqqXda yum baapirfnam a«w ^rXi^i3«oq3f*a Xsi-f? ^a«t a-i^qqWa ad* \b&a oq ax eaa^saiJ- arf* 1.q iyxcoaa adi i^rii *qa ax $1 t "-\(s fi-'i *' '• 'i i-'f^..--' ■■•-■«.) o .•' • " • ? :"v : ; it •••:'-:»:*' ' , j» *>£.. i ' -'i JS ?< ■ " " ' ■49*XIoaffd%a0i^tfi •« ■-. : •> 4& •-. a ."**a oX'., e s t&ktxd -si •3^;t9yoa/^iUf»ia?t»sss-anE*-*t-'4oftj .•;4wa«"»^ a^o; -ja»rsga?J.;ajp^A4'toa[stia.'ji,.6-,f<*i .>b?^i"-.>3?'tc{ :yXfi?.2%rcf5C'.' el ja£dWiara .©^lyavcn $A$-.b;i£ . se^ctai^jeiftl jtttwpa add' .So" 3&£Ii(fs*.gEiT « 3.onacu/3-'!t i 9 f x<>fflr|)9en- f5«^C;-e©?^©©n^c+v»i3dilwr' , iT boa ./tea e?tisMOT£ r X£&bJhr£bj3l . doga agasab ■: •Jo-aacI-aui'saTno &wmu?m± •■ t J.&n'i $Md~4»«£aff arftwnt-t.^isjc? .o4^.tCt±iwx; ttfffeM This statement, which accompanies the bill of lading, evidently means that the truck transportation broker undertakes a rather wide range of responsibility to the shipper for the safe arrival of his cargo. The broker is covered by an insurance company's open-cargo policy on all cargo for which he arranges trans- portation. He pays a premium based on gross revenue of the truckers for whom he arranges transportation. If the trucker is insured, his insurance coverage and not the transportation broker's must apply. How effective this type of arrangement has been in protecting shippers has not been determined since nothing is known of the loss record of firms using exempt truckers or the percentage of losses which have been allowed under the terms of this type of policy. Several different Los Angeles brokers have had extremely different loss records, reflecting mainly their skill or care in selecting truckers. W'toff^.fttc s 39Mfe/T^&£ftr -i^cirf rloidi#»Bf8i»n* ?fatrc* ad* y 4 qjf'JBU "aiact" lo Xevfrrtn v-t&a' til taqqJfcrfe arftf ■ A. 'ogT&o' i'Xfe uo •voi'iV-q bstS'tt-riearo' ? ' *onfewiu : ox/nsvsi aactg fro b&aad oa/±B««i£f £ s^sq ©U •flot.JsKHsq; ©a^arri ax isioini' ©fit IX »it{5-i.lftyioqftfifii- e©&fia.-j3j*- ©ri. d "torr sad 'aisqqlfa anifosvtoiq ifci »n»©tf esil chi©ra9sne":-is *© golfett innt'r' lo ftrtooai rvt ol ©d$ 2o nwoir* a." sxlrfdntt it i7>b(iif bewolXfi ri9©d ©vsrf fijxfaiv/ *$aia\5frnlsm srjxio-aila'i t afaico8i asaC VII. Trucking Can Be More Useful 55. Transportation Efficiency How the entire transportation system of the United States should be organ- ized if it is to be as efficient as possible cannot be easily determined. Ef- ficiency in the marketing of transportation services is part of the problem and is similar in many respects to the problem of efficiency in marketing fresh fruits and vegetables, more familiar to members of the produce industry. What- ever one's job — public official or private businessman— the transportation sys- tem which is synonymous with optimum utilization of all economic resources is the most suitable goal for any change in transportation organization or policy. The transportation laws themselves clearly have a broad conception of economic efficiency as their objective. Present-day truck transportation of fresh fruits and vegetables has been seen to be less than ideal. There are three general areas where improvement can be soughtj First, equipment and physical operations can be improved — better and more easily utilized trucks, better roads, and adequate mechanized loading ter- minals! second, governmental policy and regulations need to be formulated with economic efficiency clearly the major policy objective j and third, the structure of the transportation industry itself needs to be reconsidered in the light of objectives of efficiency. It is in reorganization of the structure of the trucking industry where mem- bers of the produce marketing trade and the trucking industry are most likely to be able to improve trucking. It is not the equipment which most needs improve- ment but the ways in which the equipment is used. A time lag exists in adapting business methods to trucks and establishing markets for truck transportation. Incomplete adaptation has meant a lack of smoothness in coordinating shipper and receiver needs with the services that truckers can render. One result is higher than necessary costs for the firms using trucks. Another is higher costs for the truck operators themselves. Some of the costs are partially hidden — such as backhauling or idle time. Coordination between buyers and sellers is primarily a marketing job, and the present method of marketing truck transportation is the source of many diffi- culties. Its most serious imperfection is the excessive costliness of time, en- ergy, and money with which information is developed between shippers, receivers, and truckers. Today, the majority of truck transportation arrangements are sepa- rately negotiated. Truckers frequently canvass the produce packing sheds, looking arid ^iMi has fssvid grid ttl b9i9bieno&»*j Jsotn r!oxriw jns.Tiqixfps odd d"on el d.T .gni/Iooii ^voi<}fux ald& :X9 gal sm'id A .bseir el- drreciqii/ps arid rfoiirk ni E'istf sriif ixrd Snsn ■tt Tlwii ioi 8d9>h3{n n'urfsi.W£v!B9 fans :?}lotf*rifr"oc> ebodJew eeefixBue MB.' ££ xiOLe — •ftPbb^'t Yii.BXJiF-Q ©as et^no eric 10 56. for loads, and in doing this, they travel considerable distance perhaps without ever finding the shipper whose needs fit in best with their own plans. Every call they make takes up their time and that of some shipper. Also, because they have no fixed place of business and do not appear to be completely reliable, shippers who otherwise might find their services very valuable hesitate to employ them. There is no single point to which a trucker, a shipper, or a receiver can turn to determine the availability of or demand for truck transportation. Both shippers and truckers are widely scattered although heavily represented in the terminal market cities. Furthermore, frequently the person who arranges for truck transportation is actually a midwestern or other distant receiver rather than a shipper — yet the truck must be loaded and the trucker must negotiate near the shipping point. This obviously awkward and costly situation is a result of the lack of adequate information on availability, rates, and responsibility of the truckers. This same lack is the reason why shippers, who are in a much bet- ter position to choose truckers, are unwilling to arrange truck transportation for receivers and insist that the receiver who wants to use trucks make his own Although it takes at least two parties to conduct a busine?s transaction, the fruit and vegetable middlemen who buy truck transportation can do some things by themselves to improve the efficiency with which they use trucking. What they can do is indicated by the common criticisms of their methods. The main diffi- culties which shippers experience which they should be able to correct by them- selves are: 1. Not using persons with "know-how" in traffic management. 2. Not reorganizing business methods or facilities so as to use trucks effectively. Keeping outmoded habits and equipment, although improved methods or changing conditions of demand and supply have developed. 3. Using trucks or rails on a hit-or-miss basis rather than according to some rational plan. l/ The demand for truck transportation is, to a large extent, a demand by the receivers. While policies among shippers differ, in general the receiver is pressed to make his own truck arrangements. The reason usually given is that shippers do not want to be blamed if they select the trucker and the transporta- tion service is not properly performed. Most shippers report that they will use trucks only for f.o.b. shipments and consider that, for other types of sales, the added risk involved in using trucking is prohibitive. ft ft. U. Overcompensating for the extra risks involved in using trucks or fail- ing to take adequate account of the risks, 5. Spending excessive time and resources in bargaining for and locating truck transportation. 6. Having inadequate capital.—^ At the same time, there are problems which could be better solved through some kind of organized effort. Examples of problems in this category are: 1. Having adequate information on rates, equipment available, financial responsibility of truckers, etc. 2. Having accurate information on the kinds of risk involved in using itinerant truckers. 3. Disestablishing obsolete customs which may only be changed by mutual consent. U. Shippers receiving poorly advised instructions from buyers who are acting without sufficient information. 5. Overcoming elements of monopoly in the market for truck transportation. 6. Improving governmental regulations. Another type of group action would be to assist truckers in improving their transportation of fresh produce. Truckers could be made more efficient by reducing: 1. Loss of operating time by over lengthy negotiating with shippers. 2. Difficulties in performing proper maintenance. 3. Revenue lost through failure to find the best shipper for truck trans- portation which means higher costs in the long run. h* Failure to keep business expenses in line with revenue, often the re- sult of not knowing how to calculate maintenance, depreciation costs and normal profit, or of not keeping adequate books. 5. Inadequate knowledge of loading and refrigeration requirements of produce • How Brokers Have Helped Transportation brokerage is one of the first developments to appear wher- ever better coordination is needed. Experts can, because of their many contacts, perform more efficiently than can the transportation departments of all but the largest shippers. The basic function of the truck transportation broker is l/ Given the present method of obtaining truck transportation, the most ef- ficient use of trucks can be made by a large firm with an integrated system of buying points and selling points. Its own integration substitutes for a poor marketing system. It appears unlikely that there are many economies of scale within any one plant associated with trucking. q ru a o. 4 .93nBn3.;txt«H ©cmufa.j.irD o* won gruworfli *afE 10 V 58. coordination of information. A broker with whom many truckers are registered is usually able to find one to go to any particular destination. To some ex- tent, truck brokers specialize in territories. Thus, one broker located at Los Angeles might have especially good connections to the Midwest butter and egg belt while another might specialize in Texas and other southern points. While the coordination of information has substantially improved by develop- ment of brokerage, it has not progressed so far as it might. As presently es- tablished, truck brokerage is not like brokerage on a board of trade. There is no single point at which all demands for truck transportation are concentrated together with all supplies. Brokers do not seem to exchange information with each other freely, and a shipper cannot find out what trucks are available by placing a single call. While the most important brokers are concentrated in a few buildings adjacent to the Los Angeles produce market, they have separate of- fices, and their negotiations are conducted by telephone and teletype. The physical concentration is mainly a convenience to the truckers who can very easily shop around among brokers and for whom brokerage offices are popular con- gregating places. The truck brokers are useful to shippers and truckers of all sizes and types although in different ways and to different degrees. Some brokers act as agents of fairly large truck companies. A typical customer of this type would be a ICC permitted contract carrier with a long-term contract with a midwestern meat packer to haul meat to the West Coast. The trucker would use the broker as his agent in finding exempt loads as backhauls. For the small trucker, the broker is not only a convenience but frequently is the only possible source of loads. He is known by the shippers and receivers and knows vrhich of them is likely to have business. Many shippers or receivers will refuse to deal with truckers except through brokers.— ^ His advantages make it possible for the broker to charge high for his service, and in some cases, the charges are out of line with the services rendered. The potential advantages l/ Some drivers will first attempt to obtain a load through direct dealing. Whe"reas an independent might not have much success along this line, a driver for a well-known concern— especially one who had originally become acquainted with a shipper or receiver through a broker — might be able to accomplish more. Some trucking companies have issued instructions to their drivers to resort to brok- ers only after failing to pick up a load through direct contact. However, some shippers and receivers consider it unethical to deal directly with truckers originally contacted through brokers. -X9 9&0 so? ,ao X*iA.%i Hi ff •9„ Ml os 39^9 fcftft, T( ' '-YXi«933^q 2 A »4%ta « e isi i>a baBesTracxq ton ecri SI. ««MHMl|MI ll rfnam 5/ fWtWrl? »9bClJ iff f T£f}d ft flO "< T '6'If>ffO*lCf 9)i L> J'Ofi 8/ C*T ^jj^d ^aJil t h(V*5> Mrfu t » t4f ©XdsXisve e*ts eztouii S&tbsi Soo h'till .t craws 9'' tf&oqVrfa'' B'bftV vla^Tl tari^o rioa^ -lo ;sJ-a*r«q98 9v^.1 Ysd* t 'SQ*um sobbotq' kslB^nA coJ art* oJ'inooe^bfi e^nibX ri'cf vsl bftf? 3»siE iXa to 879>foirxi brte naqqirie od- Xi/Iseu esasrAaoarr it> BTxjqiri? .eaeso &3xo« ni boa ■ tgj ■MH si sH .ebeoX to a: jsH .eeaaiecd evcri'o* ^Xs^iX < *r*oIc*rd •fBf/'OTtrij iqesxa 8?MtHIQl jhrias airi 10'i rigid 93is^o o.t oat ZuRci co lajtesq ijson nxfanll at .JnssB e±rf es ixrt* XXeme srf* »e sCdiaeoq v£no sdl «£- fsd-t to rt. oirf.fr swojaa fcflis 1st Xssb &S eeislov f£j^ id art* •jert oXcf&rSjoq .tJfc TtO JCO 6TJB £3S«tSf(D 9.1+ $9. to the transportation industry of a well-developed brokerage, justified by serv- ice and not monopoly power, should not be ignored, however. Can Brokerage Ee Improved ? Today, truck brokerage in the produce industry is a high-cost type of op- eration. A considerable amount of selling has to be done to both truckers and users of truck transportation. Many brokers run their offices like junior-grade social clubs for truckers. Considerable investigation and record keeping, keep- ing tract of truckers and negotiation via long-distance telephone are involved. Neither the ICC nor state agencies regulate brokers who restrict themselves to interstate movement of exempt commodities. Their rates, terms, and services are determined by what the market will bear or by their own good sense. Today, the most commonly quoted brokerage fee is 10 per cent of the cost of transportation. This is substantial enough to deter truckers who can avoid it from using truck transport brokers. Some truckers will go to considerable lengths to avoid rela- tively small charges, and the payment of fees as high as those charged by brok- ers indicates the importance of their services. The services which brokers do render to small truckers often are a real contribution to efficiency in transportation. Many small truck operators are sailing close to the wind, and their ability to make money depends on keeping their equipment utilized to the utmost. This is a factor in making truckers im- patient over delays in loading or in obtaining loads. It is one factor in their willingness to pay high brokerage rates. Truckers also need protection against unscrupulous clients. For example, sometimes receivers will settle transportation damage claims in an unsatisfactory manner, taking advantage of the poor bargaining position of the trucker to offer substantially less than the agreed upon transportation charge, perhaps under the guise of compensation for spoilage incurred en route. Truckers forego traffic revenue if they must remain to argue these claims, and there is no established mechanism of arbitration. Several established common carriers have reported that their own response to this kind of situation was to put the cargo in cold storage, take immediate legal action to obtain payment, and get out of busi- ness of hauling fresh produce very quickly.— ^ l/ It is not uncommon for truckers to demand partial advance payment for loads. Sometimes this is because they are short of cash, but at other times, it is merely a form of partial protection against not being paid in full by the receiver. Truck brokers may make advance payments to truckers; sometimes such payicents come from shippers. 60. Often the broker is more oriented toward providing service to the shippers and receivers than to the trucker. Some brokers, indeed, became established with the financial backing of large fresh fruit and vegetable middlemen, who felt that the establishment of brokerage would serve their needs. The conven- ience of being able to obtain trucks from a limited number of brokers instead of a multitude of shippers was one advantage sought. Responsible brokers also can be relied upon to police the quality of truck equipment and to insure certain standards of ethics and business practices on the part of truckers. Some brokers have developed a system of guaranteeing railway express delivery schedules for a surcharge; another development which they have pushed is the system of "check calls" by which truckers notify receivers of their location daily after the second day out on the road. The insurance arrangements which truck brokers make are primarily of interest to shippers and receivers, especially because it is not easy for them to check the insurance coverage of the occasional trucker who may solicit business from them. The efforts of brokers to improve their services to shippers may be looked upon as ways of encouraging the shippers and receivers to deal only through them and thereby put the truckers more thoroughly at the brokers' mercy, but their ac- tions are also steps forward in the general improvement of trucking of fresh fruits and vegetables. Brokers apparently are in a good position to encourage technical improvements in trucking equipment and perishable handling techniques. On the other hand, brokers have not been very successful in getting truckers to arrive at shipping points for loading according to schedule. This is perhaps the greatest single source of irritation to shippers. Nor have the brokers yet gone as far as they might in supervising refrigeration and en-route icing of produce loads. Other Means of Coordinating Good systems of marketing rarely develop entirely without planning. The most famous markets — the commodity and the stock exchanges— were deliberately developed and arp regulated by their own members and by government. These ex- changes are examples which are likely to be considered in any contemplated reor- ganization of the transportation market. The main argument for a truck trans- portation exchange is that it permits, by the free flow of information at low cost, a more efficient utilization of truck transportation. It should mean gen- erally lower brokerage and transportation rates. hi* uBnseonfnyani sdT .b*>"'Xirf »i ^vowoH "rsjfoTrf €tlj soothe Tlojdtv nJ {tci'-i' 41JL 62. Real gains in efficiency might develop from publication of market news informa- tion on the number of truckers looking for loads in various terminal markets or shipping areas or on the rates being paid. The news of produce movement has proved to be invaluable in fresh fruit and vegetable marketing. Would not com- parable news on the market for truck transportation be of use to shippers, re- ceivers, and particularly to truckers because there are so many small independent truck operators? Be tter Insurance Where risks are great, caution prevents businessmen from acts which, in retrospect, would have been profitable. One way of helping those who market fresh fruits and vegetables become more efficient is to reduce the risk in using motor transportation thereby encouraging them to use it when, risk aside, it is the best transportation available. The economic loss caused by using a less ef- fective system of transportation is indeed a real loss, although it might not be practicable to estimate its magnitude. Insurance is one way by which the problem of risk has often been partially solved. Lack of adequate insurance protection has led many shippers to avoid using trucks when they might have used them effectively. Adequate insurance coverage is not available mainly because the insurance companies do not have the experience or actuarial record necessary to operate effectively in this field. Insurance companies must, of course, be reasonably well able to ascertain that the insured truck operators have lived up to certain standards of performance for a risk to be insurable. Spoilage and loss in transit from mechanical damage are controllable by the trucker to a degree and complicate the problem for this reason. The techniques of insurance of perishable shipments being transported by small, owner-operator truckers need to be developed beyond their present point. Much must be done before such insurance is practicable. Insurance would be - pro- hibitive unless the risk really were small, and this would depend on the manner in which truck operators performed. Some truckers never would qualify for any reasonable type of insurance. Risk Reduction by Other Means Another risk against which it is desirable for a shipper to protect him- self is financial irresponsibility on the part of the truckers who may be re- ferred to him. T /\Jhile this might be covered by insurance, probably a kind of -36*332$** iM^i^sm' \* % aoi jig Biff iflSBravorc' eor'bBitJ- xc emMl fc'X tfl" t 0i 3j3;1 >lf,J • -y : r-- 9do i^d oldello i^rrco .aj. I.I TjO t) r/6o nd virgin '0*1 i-ET: 63. "credit bureau" would be more effective. In this way, the bad operators could be detected and quickly eliminated. For the shipper himself to check into the qualifications of truckers would be unreasonably expensive unless he dealt with a small selected number. Truckers need insurance also, for example, against nonpayment by receivers with protection so arranged that they need not wait several days or until the next trip to collect. A collection agency or truckers' association might do this work very well. Another type of risk faced by shippers is the possibility that transporta- tion equipment may not be available when needed. Truckers cannot individually, nor as an organized group, make any guarantee of availability. The total amount of equipment is too small compared to the total transportation needs, and in- dividual truckers cannot afford to assume obligations to meet any transportation demands such as falls on the railroads and other common carriers. Only if truck- ers were regulated and protected common carriers could they be in a position to guarantee availability of equipment. Reliability and responsibility are benefits which develop in a transporta- tion system dominated by common carriers. Yet, it is obvious that common car- riers cannot compete successfully side by side with unbridled competition. While the establisliment of produce trucking on a common carrier basis would not be favored by the produce industry, many of the risks of using trucks would be re- duced by such a change. The advantages are perhaps obscured at present because produce shippers do have a common carrier group — the railroads — to fall back on in time of emergency. Government Regulation and Marketing Efficiency Today, many of the factors which led to the original Interstate Commerce Act no longer apply. Competition among truckers is inherently greater than among railroads, and the railroads no longer have the virtual monopoly of transporta- tion which they did in the days when the Act was passed. The shifting emphasis in transportation suggests re-examining the laws affecting truck transportation and the administration of these laws. Since we have in the past ten years dispensed with wartime economic regula- tions when plausible arguments were advanced for their continuance, and often with strikingly beneficial results, a burden of proof rests on the shoulders of those who wish to continue transportation regulation. A more restricted scope for ICC activity might be an improvement over the extremes of no regulation or the present situation. hlitos etoiciBqo bad edtf t^ 8 * «I .ovi.+ nal'la e-xom sd bluov "flraowd* .+xb9"tn" erf* **xi ?ioado ocr IXeamXrt inqqiris ©ff# *tfl .ba^artimH* *xrp bna baJwfcfafc ad rfiw -t£ssb sd ?es>£nt/ aviectzox* ^Xdanoaeem" ©cf bXnov aiselornj- 1c pnojtfsoilxx-Tup tgvlaon yd ^n^mysqnorn tzcus-pB ,sIqmEoc? 'trl ,caXa aona , nr;inf b&sa s-rejfooif sriJ XJJntr -so sviib bnwes v+xsw ion been vad:r ierfj fcesnariB 08 nocJ-Ofaoiq ti&frt -nx r-ns t sb93n noxistfioqcne'v: Lbj'Ox ohj o 8ia yj"xXxoj.5.iioq-'^T l>ns ^Jiixuax is/i ~iao nonwoo dadd «ioxvtfo ?x >ti « t .t^Y ♦ siainae aotmco "%d bad«:Mob mad aye hoW sXinV .«c "c t id aqmoo beXblidnx; ddiw obx& yb abie \rIXui3e3coi/e odeqnoo -domusb -ei'oin ed don bXttow aXeed laio/fiR) aoraraoo e rVo aatobtttd sbttBt?*? to i ; •u!3xXdjt'iB9 •»sl od bXtow eiioxnrd griipti lo Vcjfa.t'x ed f lo \jtam l t %TOBijfjfrx aouto-iq add \Tj '-'fi&ftfefli eausood iriWa-iq da bswoedo '"aijwfcisq aia easBd'aBvbe 4iff * . agftadb : a dot's \p-b9aob no jfesd IXal ed--ebsp*Xxa«i '9'd>--qt/oig leivxso nbnmoo'a avad ©b p-iaqqirte aVjL'frfjq •^fS9^''X9iii9 lo braid 'ni 9oif>flfi!fo0 ydBieio^nl XaxiXslio ad* od b9X risxdw 8'tfo^oax ostt J.o vnam t vsboT on a flarid ladaaig yXtn'S'xannX fii'ojfwid 'tnotna fio2*x*t.qit(o0 - dJ bxia , t sfc>JoiXJ!e*i eXcariqais sniJ ^idi* ©dT ^boef'aq spw iok adJ n^rt^ ayeb adJ fii bib ysdd*' rioxd - -' noi i • .swaX osori ? xo ttol3si:!z i.iixotO£ Ml ons aXx/ssi oxmofiDOB s.-nxiisw' riiiw' bsaaoqaib eia )Y nsi *etq odJ flx avsri sw aonit. noilo bne 1 9onavnX jnoo niodi to't bd&aavba eisv biitamirsia oldxsiaXq nsd*/ anoXi 10 a"J9bI i, oria add no eiesi looiq 'io tiabiuo a t .:jXxsa'x Xcxo.tlsnad yX^nijiliJ'e dwiw aqooe b^oxiJaan won A «aciJsXu$9i noxiriioqariai) a^niinoo oJ daiw cdw «8od* "io ncid"aXi;rv'i on xo eanraiitx^ sdJ i^o Jnofflsvoiqmi. .18 acf irigirn ^ji'/Xtoa 03X tol 6U. There is still a plausible case for continuance of regulation — too involved to give here. Indeed, most of the enfranchised transportation industry has be- come accustomed to regulation and the protective umbrella it holds over them. It deplores the impact of unregulated price and other competition from the ex- empt part of the industry. It wants all carriers to compete on an equal basis and strongly prefers having them all regulated to having them all unregulated. It feels that regulation contributes to over-all industry efficiency. There has long been a presumption in the law that the common carrier, in- curring obligations for a certain performance and in turn partially protected from competition, was the type of agency best suited to serve public transporta- tion needs. The produce industry has never had a motor transportation common carrier group available for interstate transportation, although there are some intrastate common carrier operations. However, highway common carriers would produce many special advantages and retain as well advantages of speed and flexibility of exempt truckers. The agricultural exemption which rules out common carriers for produce trucking should be re-examined. Furthermore, public policy on transportation is a larger issue than fresh fruit and vegetable transportation, and the entire regulatory pattern can be adjusted to benefit a special group without producing serious dislocations elsewhere. The exemption was designed to help agriculture. It may be asked if the benefits to agriculture are large enough to offset the adverse effects on the transportation industry. There is, actually, no adequate way of answering this question. Perhaps agriculture as a whole does not benefit at all. Some transportation problems of agriculture, such as perishability and sea- sonal variation in shipments, may mean that common and contract carriers are not so well suited to agricultural transportation as are exempt haulers. On the other hand, lack of regulation may benefit agriculture mainly by permitting in- tensified competition among those supplying transportation. If this is the real advantage, and if the advantage is so great that the agricultural exemption is justified as public policy, the merit of public regulation of transportation for any product must be seriously questioned. ♦lujttf 7svo eblod ,tx sll-ncto svjrcroajoiq erf j- f ciafid Isx/co ns no oj^jnoo oi aisiTico lis stm -ni t'rsi'i'XB: baJni.l oici i ot^ tfarfj- wbI sdi rri noi.?c [ tnuS n| fens ao/tanioj.'ioq ibu .no. fallow bns » •' no Tjojfloq has ,noiiBi*t( LOrtW B P.B 'If! 65 VIII. Better Ways of Assembling Loads for Truck Transportation Efficient long-haul trucking means keeping the big trucks busy in the kind of transportation for which they were designed and not wasting them in local pickup and delivery operations for which smaller trucks are better adapted. Trucking can be more efficient and ultimately more economical if the big trucks' "turn around time" can be cut to a minimum. Reducing both of these wastes is mainly the job of the trucking industry, but the fruit and vegetable marketing industry can help too by arranging for the cross-country hauler to stop at a minimum number of points M One of the reasons some people have been interested in concentration mar- kets is that they would help trucking be more efficient in just these ways and would help establish a better market for truck transportation besides . Where concentration markets do exist — and there are nearly 100 in eastern United States—they have been particularly well adapted to trucking operations. Per- haps these markets belong in California too. What Concentration Markets Can Do A concentration or shipping point market is a center located in an area of commercial production of fresh fruits and vegetables to which near-by farmers or agents bring produce for sale (usually in small quantities), where buyers and sellers meet, and where the produce is purchased and assembled into lots for transportation to distant markets. A concentration market is not like a farmers' market located near or in a large city where produce is sold by growers mainly to consumers or retailers. While physical concentration is the outstanding characteristic of each type of market, sales in a concentration market are to middlemen, not consumers. Such a market only works if it is an assembly point for produce middlemen. If concentration markets are to be suc- cessful and useful, the commercial fruit and vegetable growing area where they are located must be at some distance from the consumers. Otherwise, growers find it too easy to contact retailers directly. Also, there must be enough 1/ While the extreme of always one single loading point and one single un- loading point would be inconsistent with some of the main advantages of truck- ing, reducing the number of loading points would produce economies. A cost study of various ways of using long-haul produce trucking would indicate what investment in a concentration market might be justified by the savings. oid'sJioCTafiBtT 3I01/1? 10I abfioa &A lo ey&W 19 ad.t nx yswd e>ioiii* §xd add 1 gnxqag?! errsdm afltfeftWl ftWHpBif flflriS) if marl* §at*aew Jon bne bertgiesb 9i9v; nsriJ doxdvr 10'i no EtffitooqtUtiH 19&&96 oifi eMoirid nsXXeaia doirfw 10I enoi Jsigqo q£**» *X9b t l tf3 li Xeeiraonooe 9io.n vX>dsmxdXu bits d olqoaq anroa anogesi 9rfi lo j bns ftfetr easrfd Jcxjc nx dn9xox'il9 o-ron sd gaialoi/i* aCsri bXffow Y 9f *J &&&& aisdW »&ebio9tf noidfid-ioqenaid- iIouiJ- 10I *e:#x«?ir» i9dcted s dsildr.tes ql< bsilnU ni9Je39 ni 001 xXisgn 91s 9iedcf bnB— Jaixg ob ziodiim aotiz 1 -'X9*? .anoxJsisqo : ax joMtsiu union SfitqqXiaC in noxTiviiynsonoo A \d-is&a doidw otf a9Xdedss9v baa adinil dssil lo noidoi/boiq I»io laeimoo 10 »iodv f (B9xJi:*nrjjp Xlenia Hi vXXfXfoii) olse 10 1 soi/boiq anxid EJn9gs 10 eienrasl octal, beldmpses one boc-domq si sowboiq ed-i 9i9rfvr bns «d/9P!n eioXXsa bna ei^ji/d »IiX ion el iaiJusm noi^Mirtsonoo A •aJeshtsm dns^eib o.r noitfsvfioqansid 10I adnj. ^d bXoB p.i 9O0boiq 9iedw yjko ©ai£l 6 at w «X99ttt bgJaooX d9^iani 'aiemisx e &A1 -cl noiJeiifnsonoo Xsoiey/iq aXidl-/ .sieXicfsi 10 aioitti/enoo oi YXniam eis^oiq Hoi^6ijn3onco s nJ: B9Xsa t ^9>fis£r. lo 9qyd doss lo olJsxioioslsdo pnibn^daino ne si <+i li a>(iow TjXno JsMism e xioi/2 ,Ri9fsiJ3noo Jon ^nsmaXobiai ri 9is jfjBoflsm — 01/13 s*u o-i sis 8J9?Iiort noxJaiijfTsonoo II *fiCMH9X.bbxjn 9onnoicr 10I jnxoc '^Lc.'i^v-Z!^ Ysdcf sisriw R913 sniT.'ois oXdRJo^gv bfts Jiyrl iGioiormtoo edi ^Xx/lesu bne Xylssgo Bi9;«Ji5 jSeiWioddO .Biaxsuanoo 9dJ iti?ii eonciaib e.i^e i& 00 $&m b9d-!5ocX 915 d^uon9 ed Jgum oigdJ { osXa .vXJoeitb eislx.^dsi JoaJnoo vea? or>& di bftix iX^ace ©no ji 9iH9'itxs tdJ sXJtdvT \X oa dcMw dnsiaxutoorti ad bXuov dnxoa ^tifeaoX 66. growers of the kind who find the market useful to keep it well supplied. This usually means growers who are small enough so that they cannot make effective use of such agents as shippers, brokers, or distant receivers or efficiently market their own crop directly in some distant big city. Concentration markets must be near to the growers. The one at Benton Harbor, Michigan — one of the largest — served mainly growers living within 20 miles according to a 19U6 study. Concentration markets in California would have to compete with the present well-established and efficient system of marketing. For this reason, they might not be as successful in California as they are in the Southeast where alterna- tive marketing systems frequently are not so good. In California, there are many large shipping organizations with packing plants or contacts all over the state which can arrange to assemble complicated mixtures of produce by tele- phone at little cost and then arrange for truckers to pick up the load at a minimum number of points. Concentration markets usually are for personal sell- ing by the grower. One of the bad features is that this may take him several hours a day. Not only does this distract him from his main interest — growing— but often he is not very skillful at selling. Parenthetically, it must be noted that there are many reasons why concen- tration markets are desired other than efficiency in truck transportation. Many- farm marketers are ever anxious to reduce the number of middlemen. Also, in the opinion of many, efficient price making requires physical assembly of a large number of buyers and sellers. There are those who feel that prices should be determined in a local market rather than at some distant big city. These problems do not concern truck transportation directly, and we will pass them by. Of direct and special interest is the problem of efficiency in marketing motor truck transportation itself. A trucker and potential buyer of truck transportation dealing with each other are somewhat isolated from other truckers and buyers, and it may be that more satisfactory trucking arrangements and rate determination would be made if many truckers and shippers were assembled at one place. Indeed, since the marketing of exempt truck transportation is poorly developed, the gain here might be more than in marketing of fruits and vege- tables-,^ 1/ Loading docks and terminals are needed badly by produce truckers. One other advantage of a concentration market is that in building it, a modern physical plant could be developed with consequent improvement in operating ef- ficiency of truckers and middlemen. •cirlT. . .baiXqqns XX&v dx qpeX -oi Inlaw &b~Ai&8( add brtil odw bnia add lo bisv ©v£do9ll9- ©jLsto donna o %qx{& darfd oa rf^uori© XXsnn sob odv siavo-cg sob era y,XXf • . vXdnaicjxlla 10 Riavxao©': onsdaib 10 ^Bifwiotd .aiaqqrn'a bb B^nr'Tia drwa lo ed-Mftam (iQx«J£i^naonoD .y.dxo aid daadaxb ©nos ni yXdoaiib qoio nwo ilo^t da> ©rij lo ano— •na^xrioi.M ,iodiaH aodn©3 da- 3 no sdT .stswoia ©rid od ia©n ©d i shuia bd%L a ©d Qnibioooa eaXirs OS niddiw gniv.frX siawrg- v;XnxBm baviaa — d-s©: dnaaaiq grid diiy-sisqsm? od arari blnov ainioliXaO ni edatfiBm noida-x+nsonoO rf;4ini -£©rfd •noaasi sirid io 7 ! * gnxd©:4 , xsni lo ftsdsY 3 drrsi^xlla baa bgxiaildfidaa-J -Bmrsdla ©isriv deftariduo':; ©rid- at &tb v.srid be axnioiJXaD at Xylassoot-'?. as ad a is aiadJ ^sintoliXaD nl .boo§ oa don 01a yldnanpa-il Braaje^s gnxjo^isin < add -xsvo XXa adosdnoo 10 adnaXq sai^osq ridxw enoxdacxnag-T.o ^nl-qqxria ©giaX 1 -ai'ai yd aooboiq lo Bsxadxim badaoiXqmoD ©Xdma?,as od a^rta-ris nap doidv? a, a da bsoX add - qir >ioxq od enatfoirrd lol agosfxa narid bna daoo ©XddxX da ai -Ilea IsnoBi9q -xol 9'ta yXXauBtr adsjham noidatdnaonoO .ednroq lo ladmun ira/jri. latoveB xniri ©Mad vsm aidd darid ax 89Ufda9l bad add *io .«»n0 «19v;ot3 ©rid vd ... «3niXX©B da XxrlXXbiB ri9'/ *>« ^ -n9orroo xfc EnoBasi yrtsra o-ia aiorid darid b©}on ad dsnm di ^YXTXaoidarfdrco-cs'i •noidadioqanaxj jtoircd ni ijongioxlls narfd larfdo baixaeb ©is adsjl'X8,n nob c oaXA •na."i9Xbbxtit lo tadmyn ©rid aoirbai od auoxxna rrav© ©is ai9d93i'xa»'« miax -■ a Yi^^aaa Xaoxsvdq B9iitrpo*i •^nWsm ©oi'iq dnaxorH© i^nam lo noXniqo 3d. X ;oda asDh^rr drdd X^^l odT,» «»^o4+ aie gigrf" piaXX^a bna Pi^vud "^djru/T 9' ©3©dT «'v;dx9 §id dnxdsxb 9jn^a da nadd isridci dsjliGfit XaooX a nx boniimadsi n»rii aaaq XXiv; sw bna t ^Xd03ixb rfoXdeJioqcrtsid ^ot;ad n^oonoa don ob arrol gnfrJ-^^-ism ni voasxoi'i'i© 'io maXdotq ©dd bX dsaiednf: XaXoaqa bna dnsiib J.0 ^iDutd lo ig^ad Xaidn3dO'} bna lejfoyxd A »xX©8dX noXdaiioqBrie7.d ^ouid n ':o'Aoui& i9n.!"o aistj. b9jpX0Bx 'tGiivssnoi^ 9*^8 *i9UuO d.0B9 ddxv ^rti'Xasb nOidadioq?! sdai bna BdnafnajasviP ^nXHouid - v^iodsBlBidfiB ©icm ds:ij od ysm dx bna iBVO^pd 9no da baXdsiaeas ©isv Bieqqiils bna ai^oxnd \naxn xl ©bam ©d biuow noid^ntcn yX'iooq ai noidsdioqanaij rfairnd dqnax* lo gnXdojiiesi add ©onia t b©9bnl .9: bna aj-xinl lo anidajftam ni nadi 910.1; ad drlaim aiod ntia^ add t b9qoX' b "r**"^ '"n/^d aoij^oTfi vd vXbad bab^9T n*>jG s r.anii^i'x^d bia F A loob '^nxba^d nc in 67. Where a California Concentration Market Might Be Located If a concentration market were established, engaged primarily in selling to middlemen and designed to accommodate trucking, how well would it perform and where might it be located? Adequate volume is obtainable only by locating in a producing center. A California concentration market in an area where other shipping channels exist might be predicted to draw 25 per cent of the produce from a surrounding area on the basis of eastern experience. Where 1,000 cars per month are shipped, this would mean about 12 cars per day. This volume probably would attract a limited number of buyers. The nine counties in California shipping at least 1,000 carloads per month for six months or more in 1950 were: Fresno, Kern, Monterey, San Joaquin, Santa Barbara, Tulare, Los Angeles, Orange, and Ventura. However, every county has a minimum season when the volume of produce would be too little to support a concentration market* The Watsonville-Salinas Area Possible All told, Monterey, San Benito, and Santa Clara counties ship 50,000 to over 60,000 carloads of produce a year. In 1953, Monterey County shipped over 6,000 carloads a month for a six-month period so that, even if quite a small percentage of the produce of this area flowed through a concentration market, it would be sufficient. Monthly shipments suggest a long season for a market in this area as shown in Table h» While the volume of produce is sufficient, the number of growers is quite low. According to the 1950 Census of Agriculture, there was a total of 3,759 fruit, nut, and vegetable farms in Santa Clara, Santa Cruz, and Monterey counties. Monterey and Santa Cruz counties had only 880 such farms, and it is from them that most volume comes. About 50 per cent of the shipments from Monterey County are lettuce, with celery and onions also representing an ap- preciable part of the traffic— ^ There are many small growers, however, especially in Santa Clara County, of the type that generally finds a concentration market useful. Of all the 1/ Truckloads of California lettuce have gone as far East as Philadelphia. Letter from E. R. Biddle, U« S. Production and Marketing Administration, Fruit and Vegetable Branch, Philadelphia, April 6, 1953. mm y awtfS'S.tfiaofto 0 • s ±in03 ilsO b tiXbni/OTXira 6 iw" irfa aiie rfJinfosi -Set; a 13 Wdbro hi hahgieafc fans nbmo.fbx-bii ot Tbaiasol ad ii d-dsim a-xaaw km sfd-niaidn a± arwlbv- 9#sirpobA at j-fdiBm noiisuinoorio*' fl/rnb'i.tlsO > *iaq SJS wJib oJ bsd-otfca'xq iri^cm 9scis±*i9qxo nosiaaa lo axeatf 9r!i no I igs p.iso SI iuods naerc blyow sirii •.aia^yd la ladrra/n fa9txini:X ittOliXaO nx as-tinyoo snin srii !&£ nx 9-fon ia adino/s xxa ioI riinoirt i^'ivr noaasa nynxnXn a a*. •i9?Ti6:rf noi'iJBiinsanoo 'xavb baqqjfcrfa ^imraD yo-iairicti i£5$£ hi ixSiV* £ sawbiraq lo shsbl'iso 000 t 0d "tavo Item e sixtjp It nov9 tish'i oa faoiicq rttndm-xxB a 'iol rfi/ion fe cbsolia-.i OOO^d ^i93i*i6i?T no±±6*itin9on6o 8 d^votdi bavoll saua ax/ii lb aor/boiq bdi lo 93Hin9t?x9q Jstfisai a ial -crjaaae a^oX a *e98saa einsmqiriE vEriircbH .Jnaxoxllua ad bXt'bw ix «ii alda? nx nv?oda aa B91B axrfi nx sixi/p gX •eiawoTi 16 TOdMiiff arfi tinaibxllt/e kl sauho-iq lo arafXo* adi aXXifi* &!?tC 'io I&frt s asT? aiarfi ^©rii/iliiaii^/'. lo weiraO ffeQI ad* oj snxbtoooA '.ml «9 : igin6M bne y&itO s$»tb3 jai&IO fiiasS ni siml aXdsiasav fcnfi .iiVn t i.tL-il a| $i iinh ykm&'i doua 033 iglhb bad aatihiroa at; s i6 eina3 bits YSiaJnoH isai^.^ba utiTti eixisSmqiffe 9iii lo iAaa iaq b2 J/iodA taswob arJIov iao.n isHi raarf* ntb'il oa gf ■fitnoBaiqa'r. dtXs arraiffo fans ''itaXea riitw ',ebitfi«I a« ^Jrix/S'O ^a«£ainbli ^toHxs'ii Sdi lo iiaq af da faa^q ttJm. { 88 bisXO isinsB at ^XXfti'baqasf ^lavswnri ia-is^pis XXb.hb Yne-Ti sib 3?9dT ad* if 4 lij ilv").k>zv i«*>Iia« aolisiinaanoo a abnxl ^XXe*iei«ia iarfi sq^i ad-t lb '.8.Wt t£c?X Xi'Kjft (fifdqliJSSijfcffi ',dbriciS aX 68. TABLE 4 Monthly Rail Shipments of All Fresh Fruits and Vegetables from Three California Counties, Month Santa Clara Monterey Santa Cru?, Total car lots January- 10 409 101 520 February l4 257 16 ■Mai 287 March 2Q 302 1*5 346 April 23 2 8U5 55 2.923 May 452 6,390 1,013 7,855 June 955 6,589 871 8,415 July 918 6,415 1,072 8,405 August 90 6,882 1,394 8,366 September 552 7,304 829 8,685 October 471 7,028 987 8,1*86 November 5^5 4,134 315 4,994 December 167 1,513 158 1,838 Total 4,226 50,068 6,826 61,120 - Preliminary data. Source: Calculated from U. S. Production and Marketing Adminis- tration. Federal-State Market News Service. Preliminary Summary of Car lot Shipments of Important Fruits and Vegetables in California , Sacramento. situ 1 ■ ( % -ho. is XiiqA ■ ■ ■ tadoiavofl j rnnfrii Io'tT ^£ teldet3®$\' biisTz'j hi-fi iaalr 69. fruit, nut, and vegetable farms in the three counties, for 58 per cent of them, the value of farm products sold amounted to less than ^,000 according to the 1950 Census. The Stockton Area Another possible area would be San Joaquin County. There is already a vestige of a concentration market in the old defunct product market. Here one trucker assembles less-than-truckload lots from many small growers and trans- ports them to Los Angeles for delivery to whatever broker the grower names. The variety of produce from this area is greater than in the Watsonville-Salinas area, and there are more small growers. The monthly pattern of fresh fruit and vegetable shipments from three Central Valley counties nearest to Stockton in 1953 is shown in Table 5. For a six-month period at least, 25 carloads a day might be expected (assuming 25 per cent) with considerably more at peaks. The Stockton area is also a moderate distance from metropolitan San Francisco where gluts could be shipped. Farther South Fresno and Tulare counties are another possibility and together ship about 38,000 carloads a year. Grapes are about 15,000 carloads a year, but there are also nearly 8,000 carloads of oranges, 3,000 of plums, 6,000 of cantaloupes, and 3,000 of peaches. Other near-by counties are also heavy shippers. To the south, Kern County ships about 7,000 carloads of produce a year, exclusive of the heavy early potato crop — a special case. The monthly pattern of shipments is shown in Table 6. According to the 1950 Census of Agriculture, there was a total of 6,935 fruit and nut and vegetable farms in Fresno and Tulare counties. The value of farm products sold amounted to less than oii,000 for h6 per cent of the farms which indicates that many of them are quite small and might find a concentra- tion market useful. If 25 per cent of the produce of this area passed through a market, once it was established, the central location of Fresno County and the variety of produce available would probably insure a successful market. Markets in Metropolitan Areas Because trucks available for hauling California produce back East have generally brought loads of other perishables to the major metropolitan centers %UK0 1® inaa i*q W$ *s«x^f«yap §&m$ ad* n,t MtJ^ BldB.asgav bn* ,it'« i$J?rcH a$ ^it-yoaos 000 f . 4-' -ffl&44 $Pt$ beAw*)*» M«P eitowhoiq mi*? la ©wIbv add' •ausnaO 0'£?I B9lA tiDMoztZ ari'f wsa e*jsli ,iaihB.<« joi'jjc'iq toiwlab hi© erf* ni Jaji-fBtij naiJ'ffi^iaono.i 0 Ho aaJUtea\' TSafiTJ - fens aisrojia HSBB whew jnoil e#«I feBoXatepiirflerfJ-aaoI esIdnjaqaB letfowji fit ;iOv'SvOOitc ■ lata no^>Io»c^S ad m.il aoyboiq ^9 -^a-heav 9d$ me aiofl! si? a*ai# bns t B9iB rtt aio^l pJnomqfi.'fe alcfe>t9§) b BbsoIiBo 3S i«la>0 rfllw (io©3 i orfej-oq >;Xi«?9 vyBSii ortJ aldsT jni rrasda si 3^ 4 ^ Ho Xfi^n.* b -bv a*d& t 9itKtfuoiij|A Ho st'arisD Q3$I ©d>+ otf gflj&wooA Ho 0ir|.iv ftiff ,8eWf!i/cc 01pj.fr-. fcrft ftg&wfl At emisH oXcfetosov fefiB ,tim b;i.R .tci.i^ niii Ho J'fsso isq ?k(l 10I 000 t i!' narii csoX b&$0B9m b/oe e^otibxnq wifiH "Bi?a«»pfloo b brjil J^si.-n bns XlBfra sJ-Jj/p oib r«34i 1o y^B" cterf3 ^csff ..o.owboiq bJLotoHIXbO sr^Iimu) 10H vX'fsXxBVB e^ouil ea^BSfl? ai9jnf»a rm 4 t f:Xo-. , .7f>a.^aM ^t**" *t 8aIo"i*d»s iiaq isdio Ho gbsol ^rigiro'jd TjIX^iOfcas 70 TABLE 5 Monthly Rail Shipments of All Fresh Fruits and Vegetables from Three California Counties, 1953^' Month San Joaquin Sacramento Stanislaus! Total carlots January- 189 0 0 189 February ia 0 18 59 March U86 22 10 518 April 583 95 11 689 May 1*05 179 131* 718 June 1*77 1*7 72 596 July 71*2 $99 138 1,1*79 August 1,266 297 982 2,51*5 September k,01$ 135 1,262 5,1*12 October U,539 28 1,331* 5,901 November 1,879 12 392 2,283 December 97U 2 0 976 Total 15,596 1,1*16 1*,353 21,365 a/ Preliminary data. Source: Calculated from U. S. Production and Marketing Adminis- tration. Federal-State Market News Service. Preliminary Summary of Car lot Shipments of Important Fruits and Vegetables in California, Sacramento. TABLE 6 Monthly Rail Shipments of All Fresh Fruits and Vegetables from Two California Counties, 1953^ Month ' Fresno Tulare Total carlots January U5i 1,738 2,189 February Uoi 1,078 1,1*79 March 212 175 387 April 322 201+ 526 May J-LO J., JOO X jOOt June 2,266 2,678 k,9hk July 3,36 9334 Jiwr 'o* 8fc«?q&b* JU^.^KC*****'"** <** rt.31reri.tX4 i&xWxevs *3i4 *9jf'»ya .?«K/boiq cfrjrbs&'xw '/fstf'isiSr rWxya^ftSbi&a 4 fes- Mas xVj. Crista 1 ! treed e4d s,?Xa.^nA aoJ ggcri -B9'J '?.i MS^bds l^naiJxfn-fS^Safiin&YJbB Srit-fcori ♦sbsrr. gfiisKf toplla Xsxaaqs \r.c iswot %U ftjt dojiian s IX Jxtltdcob «2 il .. « ♦ nJfd cMlaaSd ^aum tx jnlaq IStf -teXoq; xboiI gnivdm zwAouii Xi'Sd- ;noX. isiii insan.psd sXniolXXsO teo f»^3J[it!i 3ni3Siril ; to 'tllst o4T fasit ii^dJ- doirfw As 6-fd2oq *iadnu;n -odi -faepxifao^ tgrttheeX filling vbdt • ••sgetK^tf'itf ••§nXcfi6e9'i toodixw afasol, , gnxriXsicfb -lo-jr.fiXi cXXdiaaoq -id laJ.+SX' edj IX v;£d6' S^sM-csm noxifs^norrtoo -lo to^bXoVafi -9dX- a bs iAi;yd±*%f(*firt>v.4ii- htu&tf irtXtfq ilolci-6-r^ri9?i;-nrV-x:9XXs'r A .as^dasvfas ,;'i5ua bans.! •iol ^tW®6t*'rt xXXstonog"'** *X ' saxrsoeH .fa9rf'£5f9rioo-eX ^a£Aovr& as isl be. as^si-isy.. 8«?i:&gftfi aty ^hsoX fa^udsd^saw iisftij-'ri*Xw BtBiMO ac^slvqbq bi bg. * 3. Zilou^i , biiu<)$&kBV yp' ff?Xb ^"IrtlWbii^ed 1 ■.*& l t a Jnibq XssfaJt tfffol^.l*-.. bupj&ii&'fi, riaS. farte^. . afaStbX,. 73. Who Might Develop a California Concentration Market In general, where markets have not "just growed," they have been the work of private real estate companies, railroads, trade associations, or special market authorities. Governments have scmetimes built terminal markets. Con- centration markets have often been established by agricultural cooperatives. For a market to be supported at government expense, the area of benefit must correspond reasonably well with the area from which taxes are collected. Then cities can afford to operate terminal markets serving the retail outlets of the city even when the fees collected do nott cover the costs. It is not likely that a city would operate a concentration market when the majority of the sellers and buyers are from outside the city and the produce was not con- sumed locally. Financial support from actual beneficiaries would have to be obtained in some other way. A system of fees is a practical way of supporting a concentration market and causing the costs to be borne by the beneficiaries. Fees could be levied against truckers, growers, and middlemen who use the market facilities, and they would pass the cost on. Many markets operated m a fee basis are entirely self-supporting. Where there is sufficient use, and the economic benefits of the market justify fees adequate to cover the costs of operation, it is possible for almost any group with a real economic interest in produce marketing to op- erate a market successfully. jhcbV *wi* -Kd^rf wnA *iBri3 "fbsrwoia j"Mi B 'MstffMES-xXsaartos nl Ifliin^e to tC'Wia«iw>8a£ ©feet* t fti>«^iX.lA«i - t a9 NMIfllf liftBJaa 'XagT -s-JaV-f' XfemfXiMir^ b9riei.td6iG9 rt99d ftstto dvsd .fi^tsw-Tioiier iii9f»d -lo As^-'eiiJ t ofcnnqX8 friorLrxsyog is $ft**totjqua ed ofi--t&>xswris '-lVS .hsJoa/foV"^-^ e*Wi ifojtfw noil 9dt d*fr? XXsw tid*no*».Tj- bcrvf^TCoc oi&lcipv XifiJ©'! sift ^nJhnofe sftuhen X«fri.m9* 8*bib dtoft Ob btjJ'OOXXo* B9^I 9ii;fr fI9flW n&\~& T£.T.Efi 91 • • . - .■ bne t B9ivMIx9s'i ctoMicm erf.* 900 orivr ngraaibbirff hna t 2'X9woi^ t at9^wi* cte [gt.i-ino-'^is pxafid 98t b n» beJp-xeco- srt^istit -rnsM .jfo .Jbos 'srf* 8B»qfc33lJW ■ ilOOy XSS»'£ i 7U. IX. Trucking Makes Marketing Dynamic You cannot keep abreast of the changes in fruit and vegetable marketing without paying attention, among other thirgs, to the growing importance of truck transportation. Trucking is a tool for marketers, but it is the kind of tool which cannot be used without transforming the users into different kinds of op- erators. Changes must take place because of the new economic pressures generated by trucking, and if the old firms and institutions do not change, they find them- selves replaced by new ones. At the same time, fruit and vegetable marketers can control the development of trucking while they adapt themselves to it. To do this they need to think out how trucking can be guided into contributing as much as possible to marketing efficiency with as little disruption as necessary. For the truck operators and the marketers both, improvement in the tech- niques of produce transportation is a challenging problem. Such specific im- provements as better service, better equipment and facilities, and more responsible drivers are needed and will surely come in time. It is the insistence of the mar- keters, using their power to choose whom they hire, which has lead truckers to improve their service and equipment. Competition in T ransportation Of course, shippers are most interested in truck transportation because it has meant lower transportation rates and better service. Aside from rates lower than rail sometimes charged by truckers in recent years the main effect of truck competition has been to delay increases in rail rates and stimulate improvements in rail service rather than bring about any actual reduction in the rail rates. This is why even shippers who do not use trucks much are helped by having them compete with the railroads. A3 trucks have become able to compete on longer and longer hauls, more shippers have benefited by this competition and by the actual use of trucks too. On the very short-haul shipments, trucks have such great ad- vantages that they have taken over practically all traffic. There is one special point to make about the fact that trucking at first nwant savings only for short hauls, and over the years, the length of haul for which trucking was most economical gradually increased. At first trucking put the shippers nearest to market in a better competitive position vis-a-vis the more distant shippers. In the middle 1930' s, Duddy and Revzan noted that termi- nal markets were receiving a larger percentage of fresh fruits and vegetables j&fcteifW sft&frQgeV fern* SAMi '^sa* f.s-jfl^e^-' ditmoiWO*' »an' € iftjjf feife am- dgtfrftfJtir Bsau a* Jar ■99 > ot- 6*f £3$r»eia*& iqsbfi ^stff ifcfrfw anlJiSuid 1 ' lo toaj«ja£«>«'«& e gs" oidi sd Mi g«fa(*?ai^ «*f Jtfo *rfc» oi fear. d art* iS ©on^*/s>?i 9«1i Si il rbftii «t ewdS tfeWK baa fc&/**«fr sis eisviifc o* Pte&irii Bitfi as* 1 . rfSifiv i&iti frttte bSttOfo & WW ited* VU*8 icstfctf |j fcirfkde3 MoB^«"Vi^ Hi B3*S§*i6*fii *a3*! ** WW^f« » t^iibt feaie*t mo^ fefetf: A Bfft '»a.» •f^ttr.aiMMi *ta*fel daae>» ■*55 .bi'll'^ life xVQ&&r®'to "tSfvo £teis* %xrfefl ie.tii fesgsctaev tfitiJ S^el arii jirfcfe sitem ^n±Sq 'raii'^f; 'ear, s:r si9rfT ©rtj * t '?*rs9Y 9iW ':i/>6 bnc •,'8k"f?fe'ri --.T^ri'?. *^ol 'v;-J:flo assess PH(P> r\ \b&e&iba± '^Xfbt'ba^s l^.-?X*f '^r;J ! -: "or' , 5''*': : > 10 • ' ; V? ffflKft "'• . 5 Jiss&Jf -sc« s>'MSSs«*r» ®r? r ton • o J" r * rtp/m hit rmm AMI >. ; .. .-.->;■ T. ^3. 77. growing in numbers and size. They are especially well adapted to serve retailers in suburban and rural areas, and they have been helped by the decentralization of large cities, the larger incomes of rural people, and their growing tendency to buy their foodstuffs in the stores of the nearest town. Rural grocery stores no longer restrict themselves to local produce in season. New display equipment and technique and the increased variety and quality available to which truck trans- portation has contributed in no small part have helped expand sales of fresh fruits and vegetables from country stores and in turn the sales of the service wholesalers who supply them. Retailers in urban areas have found a growing group of service wholesalers in the terminal market towns who can serve their needs and make unnecessary the arduous and timeconsuming shopping for produce in crowded, unsanitary, and inef- ficient terminal markets. The larger supermarkets and the smaller chains too, by using trucks and the other new service wholesalers, are able to by-pass the terminal markets. The change is, of course, primarily one of emphasis. Service wholesalers have always existed, particularly to serve the country districts. In almost any town, middle sized cr larger, you will find today a long- established firm which has always been the intermediary between distant growers or the main terminal markets and the small isolated retailers. Of course, advantageous as truck transportation may be, there are disadvan- tages also. One of the inevitable by-products of the growth of trucking has been that some old facilities have been made obsolete. This has been costly to the firms with large investments in terminal market and railroad loading facilities. Another difficulty which probably never can be remedied is that the Market News Service does not get information on fruit and vegetable movement of the same ac- curacy as when movement was almost entirely by railroad car. Some of these problems can be attacked by trade organizations, by individuals alone, or by government. For example, problems having to do with the organization of transportation marketing, establishment of efficient trading customs, and co- ordinated movement of equipment seem to be of the type most suitable for trade associations to handle. Terminal markets need not give up their traditional po- sition without a struggle, and much might be done to make them more attractive for trucking operations and the service wholesalers. Present terminal markets are too often inadequate for trucks, the streets being too narrow, loading docks the wrong height, or too small. The development of truck maintenance facilities and brokerage houses in terminal markets, adequate parking areas and access roads would help in many cases. o eno n MM 10 vd , 'I- !•'- ■ r- «rfT 78. Ultimate Objectives While it is, of course, only a means to the end of more efficient produce marketing, how the market for truck transportation, as a coordinator of that transportation, affects fresh fruit and vegetable marketing is the primary con- cern of this report. A marketing system of a competitive economy tends to be more efficient as marketing information tacomesmore complete and accurate, as price making is systematized at low cost, as prospective buyers and sellers are enabled to make necessary business connections easily, as partial monopolies are limited, as the number of poor business decisions based on imperfect know- ledge of the market is reduced, and as efficient use is made of storage and transportation facilities. We are interested in whatever can be accomplished along these lines by growers, truckers, and middlemen working together to in- crease the effectiveness with which all of them do their jobs. yon, «.S£U . -..-5- >r wor j'£ Jjj forte \bo -4? M J