University of California College of Agriculture Agricultural Experiment Station Berkeley, California THE MANUFACTURE AND USE OF CALIFORNIA CANI^TED ORANGE JUICE by H. J. Stover A Preliminary Report April, 1936 Contribution of the annini Foundation of - Agricultural Economics Mimeographed Report No o 45 1" 4. THE MNUFACTURE MD USE OF CALIFORNIA CAi^ffiD OM.NGE JUICE H. J. Stover^ This constitutes a' preliminary report upon one portion of a project relat- ing to the manufacture and use of California canned orange juice, the objectives of which are 1. To determine the character and degree of market competition between csmned orange juice and fresh oranges. 2. To determine the character and degree of market competition between canned orange juice and other canned juices, such as grapefruit, pineapple, and tomato . 3. To determine the relation, from a manufacturing standpoint, of orange- juice canning to the manufacture of other orange by-products such as orange con- centrate, beverage base, orange oil, pectin, and orange pulp dairy feedo 4. To demonstrate the feasibility, or inf easibility, from an economic point of view, of marketing large quantities of California Valencia oranges in the form of canned juice. 5. To determine the relative returns which grovrers might expect to obtain for oranges manufactured into canned juice as compared v^rith those marketed as fresh oranges. The portion of the project to which this report relates raight be referred to as "the factual picture of the supply side of the canned-orange- juice industry." The Consumers' Counsel division of the Agricultural Adjustment Administration will report at some later date upon "the factual picture of the demand side of the canned-orange- juice industry" and "the attitudes of consumers toward canned orange juice ." This report is based, to a considerable extent, upon the feturns obtained in a survey of the manufacturers of orange by-products in California, made in February, 1936. Orange Production The average annual production of oranges in the United States during the five-year period, 1920-1924, amounted to 34,386,000 boxes of 70 pounds each (table l). Of this amount, 20,123,000 boxes, or 59 per cent, were produced in California, and 13,918,000 boxes, or 40 per cent, were produced in Florida. Only 345,000 boxes -- 1 per cent of the total were produced in other states. By 1920-1934, the average annual production of oranges in the United States had reached 58,898,000 boxes, indicating an increase of 71 per cent in the output ^Xllssistant Professor of Agricultural Economics, Assistant Agricultural Economist in the Experiment Station, and Assistant Agricultural Economist on the Giannini Foundation. 1 I i y 2. TABLE 1 Production of Oranges in the United States j by States, 1920-1935 Crop T' .-^ -t- 1 ioxai year* California r lor Ida iexas Arizona Alabama Louisiana Missis- Unitea sippi States thou sand thousand thousand thousand thousand thousand thousand thousand boxes boxes -f - n boxes 7 boxes boxes -j^ boxes f -J— boxes '1 boxes -f 1920 22 j,547 12, 159 60 105 54 32 "7 / n cT o4, 95 ( 1921 13, 921 11 ,405 80 105 A 64 39 25 , 614 1922 21 5 286 14,010 5 81 244 77 58 35 , 761 1923 24, 324 17,051 8 86 289 96 71 41,925 1924 18,535 14, 964 15 60 3 96 mm «■ 33,673 1920- 1924 average 20 ,123 13, 918 6 r7 73 149 77 40 34, 386 1925 24y 200 13, 299 13 86 167 129 35 37 , 929 28, 167 14, 801 53 75 96 TOT 193 54 A ry A rz C\ 43 ,439 1927 22, 737 12,771 90 54 141 o tr r7 257 64 o6 , 114 1928 38, 994 19 , 435 148 99 109 o r7 283 39 59,107 1929 21,483 13, 248 336 137 O rr 273 240 4:0 35 , 765 1960 60 , 470 24, 700 f? O T 321 139 4 251 o 60 , 800 1931 34,900 18,283 669 145 103 315 69 54,484 1932 34 265 20 828 405 147 154 310 O jU W 103 -i. V/ w 56 212 1933 28,439 23,271 501 143 4 273 3 52,634 1934 46,086 22,628 720 170 180 377 113 70,274 1930- 1934 average 35,832 21,942 523 149 89 305 58 58,898 1935 t 34,392 20,571 806 260 3 1 314 1 56,347 * Year beginning November 1 in California and. Arizona, and September 1 in other states e t The net contents of boxes vary. In California and Arizona the approximate average for oranges is 70 pounds net; in Florida and other states it is 90 pounds. In order that the data might be comparable, the author converted the figures for Florida, Texas, Alabama, Louisiana, and Mississippi to a 70-pound box-equivalent basis by multiplying the figures as given by the Division of Crop and Livestock Estimates by 9/7. ^ Prelimimry estimate of indicated production. Sources of data: Division of Crop and Livestock Estimates, Bureau of Agricultural Economics, United States Department of Agriculture. 1920-1933: U. 5, Dept. Agr. Bur. Agr. Econ. Statistics relating to the citrus industry, 1934:3. March, 1935. (Mimeo.) * 1934-1935: U. S. Dept. Agr. Crops and Markets. February, 1938. p. 52. s. during the intervening decade. The production increase, by states, was 78 per cent in California, 58 per cent in Florida, and 226 per cent in other states. The annual production of oranges in the United States during the past six- teen years has fluctuated between the 1921 figure of 25,614,000 boxes and the 1934 figure of 70,274,000 boxes (table 1 and figure l). The trend of this production has been upward at the rate of approximately 2,000,000 boxes per year. Concerning the outlook for orange production, the United States Department of Agriculture reports as follows "Orange-tree numbers in California, Florida, Texas, and Arizona climbed from about 20,000,000 in 1920 to around 31,000,000 in 1930, and in 1935 reached 32,000,000. Of the total trees nov/ in groves, about 13 per cent are not of bearing age, while 27,897,000, or 87 per cent, v^rill be in bearing for the 1935-36 crop. Of the bearing trees now in groves, about 26 per cent are from 4 to 10 years old, 18 per cent are from 11 to 15 years old and therefore approaching full production, and 56 per cent are more than 15 years old. With so large a proportion of the bearing trees still in that group where large increase in production per tree will take place, it seems inevitable that, barring unusual loss from abandon- ment or weather hazards, producing surface will increase materially during the next 5 years." "The outlook for the next decade is for increasing supplies of oranges inmost exporting countries. Present world production is roughly 175,000,000 boxes. Ten years from now it will probably be over 200,000,000 boxes. In the older countries that export winter oranges, such as Spain and Italy, production is not increasing rapidly but attention is being paid to the improvement in quality of the fruit. Output is increasing very rapidly in Palestine. Among the summer exporting countries, Brazil and South Africa offer the most competition to American oranges. Pro- duction in both of those countries is increasing." "The long-time outlook therefore is for a continuation of the upv;ard trend of supplies of oranges, both in this country and abroad. It seems certain that if trees now in groves in this and other countries roach full producing capacity , orange producers and prospective producers can expect to divert larger and larger proportions of their orange crop to by-product plants or cull piles in order to maintain prices on the packaged fruit, or can expect that prices must be reduced to conform more closely to the prices of other fruits if the crop is to be marketed. In either case, it does not seem probable that average orange prices during the next decade will equal those of the prode press ion period." Orange Shipments o.nd Prices Oranges produced in the United States are often classified into two groups according to time of shipment. Those shipped during the six months. May through October, are referred to as "summer oranges." A large portion of these oranges is produced in California and consists mainly of the Valencia variety. •^u. s. Dept. Agr. Bur. Agr. Econ. The Agricultural Outlook for 1936. U. S. Dept. Agr. Misc. Pub. No. 235:110-111. November, 1935. Digitized by tlie Internet Arcliive in 2014 littps://arcliive.org/details/inanufactureuseof45stov 4. Production (000 boxes) 75,000 \ I Florida, Texas, Alabama, Louisiana, and Mississippi California and Arizona 50.000 25,000 0 1920 1925 1930 1935 Crop year Fig. I,— Production of oranges in the United States, 1920-1935, The trend of orange production in the United States since 1920 has b6en upward at the rate of approximately 2,000,000 boxes per yeari the trend in California has been upward at the rate of approximately 1,500,000 boxes per year, (Data from table 1.) ) I 5 . Oranges shipped during the six months, November through April, are termed "winter oranges." They consist mainly of the Washington Navel variety produced in Cali- fornia and of the numerous varieties of a quite different type produced in Florida. Shipments of summer oranges in the United States since 19 21 have fluctuated between the 5,202,000 boxes recorded in 1922 and the 20,939,000 boxes estimated for 1935 (table 2 and figure 2). The trend of shipments betvTOen 1921 and 1935 was upward at the rate of approximately 800,000 boxes per year. During the fifteen-year period, 1921 through 1935, over 91 per cent of the summer orange shipments were made from California, nearly 9 per cent from Florida, and a negligible proportion from other states. The ratio of California shipments to total shipments did not change much during the intervening years, declining slightly. During the ten-year period, 1921-1930, the f.o.b, California price of sum- mer oranges shipped from California averaged |4.11 per box. It varied from hp2.69 per box in 1929 to |5.87 per box in 1930. During the next five years, 1931-1935, the price averaged s^2.12 per box — 52 per cent of the 1921-1930 figure. When deductions are made for the approximate costs of packing, selling, and advertising oranges, it is estimated that the average price received by growers for fruit delivered to the packing house amounted to $1«48 per box during the 1932- 1935 period. It varied from |lol7 per box in 1932 to *2cl4 per box in 1934. Additional deductions for the costs of picking and hauling give an estimated average price of 11.35 per box between 1932 and 1935 for suimner oranges on tho trees . Shipments of v\rinter oranges in the United States since 1920-21 have fluc- tuated between the 13,850,000 boxes recorded in 1921-22, and the 30,639,000 boxes in 1934-35 (table 3 and figure 3). During the fifteen-year period, 1920-21 through 1934-35, average annual shipments have am.ountod to 22,812,000 boxes. The trend during this decade and one -half has been upvard at tho rate of approximately 900,000 boxes per year. On tho average, during the fifteen years 1920-21 through 1934-35, 55 per cent of the winter orange shipments were m.ade from California, 44 per cent from Florida, and 1 per cent from other states. As was the co.se v;ith summer oranges, the ratio of California shipments to total shipments exhibited practically no trend. During the ten -year period, 1920-21 through 1929-30, the average f.o.b. California price of winter oranges shipped from California amounted to $3.34 per box. This figure is comparable with the $4.11 per box received for summer oranges. The fluctuation in tho annual average price was between the |2.12 per box recorded in 1923-24 and the |4.45 per box in 1929-30. During tho five years, 1930-31 through 1934-35, the average price amounted to $1.77 per box — 53 per cent of the figure for the previous ten years. An estimated average price of $1,07 per box was received by grov/crs in California for winter oranges delivered to the packing house during tho four years, 1931-32 through 1934-35. Deductions for the costs of picking and hauling give an estimated average price of |0.93 per box for tho fruit on tho trees o TABLE 2 6. Shipments of Summer Oranges in the United States, by States, and Average Prices of California Summer Oranges, 1921-1935 May to Shipments California prices October Otiie r United r oO . D o Price at Price California Florida state s pri ce packing on house* trees 1 1 2 3 4 5 6 r? / thousand thou s'liid thousand '".■^.C'.loa'.l d d.: Ij.ars dollars _ : dollars boxes bo xe s boxes boxes per box po r bo X per box 10, 549 409 10 10, 968 3.32 1 Q O O A c: o O 4,o2o bbl 13 5 , 202 4. 64 T QO'Z Ivco 10, Ooo 1,01 y 3 11, Ooo 2 . / o 1 Q O/l 10,0OD 1 , Odd 1 11 , 14o 0.12 IvcO /? ceo D , bby b 1 1 10 n o n / , 2ob 0 .26 xy CO 10, olo 4oo 1 11,29/ o .59 ~\ 00'7 XC f J. o cs J. G , V^C i7 4-11 1 928 9,154 607 8 9,769 5.74 1929 17,735 1,702 46 19,483 2.69 1930 9,306 792 15 10,113 5,87 1931 16,426 1,937 10 18,373 2.27 1932 16,011 851 8 16,870 1,82 1.17 1,02 1933 15,884 2,919 17 18,820 1.78 1.22 1.09 1934 15,234 1,856 46 17,136 2,74 2.14 2.01 , 1935 19,361 1,577 ^ 1 1 20,939 t 2.01 1.41 t 1.28 'r * FoO.b. price less packing, selling, and advertising costs « i'F.o.b, price less picking, hauling, packing, selling, and advertisjjig costs. \ Pre 1 iminary . Sources of data: Col. 1: Compiled from records of the California Fruit Growers' Exchange. Cols. 2 and 3: U. S. Dept » Agr. Annual summaries of cerlot shipments (mimeo.) and Crops and Markets (monthly). Data converted from carlots to boxes o Col. 4: Col. 1 plus col. 2 plus col. 3. Col. 5: Compiled from records of the California Fruit Growers' Exchange. Prices are the weighted average prices received for oranges shipped during the six months, May through October, and include prices of packed fruit and loose fruit on a packed-box basis. Cols. 6 and 7: Computed from cost data published in the Annual Reports of the General Manager of the California Fruit Gro\rers ' Exchange. 1932: Report for the year ended October 31, 1932. p. 29, 1933: Report for the year ended October 31, 1934, p. 27. 1934 and 1935: Report for the year endod October 31, 1935. p. 29. 7. Shipments (000 boxes) California f.o.b. prices (doll ars per box) 30,000 Shipments, United States ^ Shipments, California 20,000 10,000 - 7.50 6o00 " 2 •50 1921 1926 1931 1936 May- October Fig, 2e Shipments of summer oranges in the United States and average prices of California summer oranges, 1921-1935, (Data from table 2.) \ •1 / I ■ • ' '' " . > ' r ■ . ■•>.•' < I TABLE 3 8. Shipments of Winter Oranges in the United States, "by States, and Average Prices of California Winter Oranges 1920-21 to 1934-35 Shipments California prices November Other United F.o.b. Price at Price to California Florida states States price packing on April house * tree si 1 2 3 4 5 6 7 thousand thousand thousand thousand dollars dollars dollars "boxes "boxes boxes boxes per box per box per box 1920-21 11,388 7,103 51 18,542 2,44 1921-22 8,252 5,519 79 13,850 3 • 9 9 1922-23 9,934 7,838 194 17,966 2.71 1923-24 11,369 11,337 263 22,969 2.12 1924-25 10,267 9,555 23 19,845 3,60 11,782 7,643 161 19,586 3.50 1926-27 13,782 8,833 100 22,715 3,45 1927-28 11,903 6,888 192 18,983 4.39 1928-29 15^472 12,321 168 27,961 2.80 1929-30 11,351 8,366 340 20,057 4.45 1930-31 15,526 13,806 181 29,513 2.17 1931-32 15,125 11,683 244 27,052 1.80 1.15 1,00 1932-33 13,132 11,008 277 24,417 1,43 0.87 0,74 1933-34 12,570 15,059 450 28,079 1.65 1,05 0,92 1934-35 17,050 13,004 585 30,639 1.80 lo20^ l«07f * F,o.b, price less packing, selling, and advertising costs. "t F.o.b. price loss picking, hauling, packing, selling, and advertising costso Preliminary. Sources of data: Col. 1: Compiled from records of the California Fruit Growers' Exchange. Colso 2 and 3: U. S. Dept. Agr, Annual summaries of carlot shipments (mimeo.) and Crops and Markets (monthly) „ Data converted from carlots to boxes o Col. 4: Col. 1 plus col. 2 plus col. 3. Col. 5: Compiled from records of the California Fruit Growers' Exchange, Prices are the weighted average prices received for oranges shipped during the six months, Noveiriber through April, and include prices of packed fruit and loose fruit on a packed-box basis. Cols. 6 and 7: Computed from cost data published in the Annual Reports of the General Manager of the California Fruit Growers' Exchange, 1932: Report for the year ended October 31, 1932c p. 29. 1933: Report for the year ended October 31, 1934. p. 27. 1934 and 1935: Report for the year ended October 31, 1935. p. 29. 9 Shipments (000 boxes) California f«o.b. prices (dollars per bo x) 30,000 "^7/^ Shipments, United States V/^^ Shipments, California 20,000- 10,000 0 1920-21 - 7o50 5,00 2.50 •1925-26 November- April 1930-31 0 1935-36 Fig, 3e Shipments of sumitier oranges in the United States and average prices of California winter oranges, 1920-21 to 1934-35. (Data from table 3.) J 10 The Manufacture of Canned Orange Juice in California Prior to 1931, as indicated in figures 2 and 3, the prices of both summer and winter oranges in California were maintained at levels sufficiently high as to permit the sale of all merchantable fruit as fresh packed friiit. Extensive advertising, together with the greater availability of the fruit in practically all markets at all times, had created a demand for the product which made it possible to sell increasing quantities of the fruit at the same or higher prices. The limited quantities of oranges which for one reason or another were unsalable as fresh fruit were converted into by-products such as oil of orange and pectin — products definitely noncompetitive with fresh fruit — at prices which were generally considered quite satisfactory. Much of the growth in the demand for fresh oranges in the United States during the 1920 's was at the expense of other fruits, notably apples and prunes. A large proportion of the fruit consumed by the American people is consumed at breakfast, and the old standbys of baked apples^ applesauce, and prunes gave way to the preferred orange. The emphasis in advertising placed upon the health- giving properties of citrus fruits had considerable effect upon this shift, as did also the slogan, "Drink your oranges," which was designed to appeal to the many hurried breolcf ast-eaters of the nation. Since 1931 the prices of both summer and winter oranges in California have been at very low levels. This has been due, in part, to the low buying pov^er of consumers during these depression years and, in part, to the failure of the up- ward trend in the demand for oranges in the United States to keep pace with the ever-increasing supplies of the product which were available for sale. The favorable prices of the 1920 's so stimulated the planting of oranges that the entire resultant excessive supplies have not been salable as fresh fruit at prices which would give (Satisfactory returns to growers. In an attempt to make the best of the unsatisfactory condition of the market in recent years, the orange industry has put into effect various plans for controlling the volume of fruit to be marketed as fresh fruit. These plans have been predicated upon the theory that the total returns to grovrers for oranges increase as the volume sold decreases. Accordingly, large quantities of fruit have been withheld from the market for disposal in forms other than the fresh product. As increasing quantities of oranges have been diverted from the fresh marked to by-products channels, the profitableness of the latter means of ■. disposal has also declined. The market outlets for many of the orange by- products, such as oil of orange, are quite limited, hence the offering of large supplies of the product on the market often proves very price-depressing. The availability of large supplies of oranges at relatively low prices during the early 1930' s gave an added stimulus to the development and use of many orange by-products. Among the more important of these products are concen- trates, dairy orange juice, canned juice, pectin, and oil. Of these, only the first three are strictly "juice" products. Orange concentrates include a wide variety of concentrated juices which manufacturers pack for use in carbonated beverages, ice cream products, and the like. They have been manufactured for many years from the low-grade oranges which were unsuitable for packing as fresh fruit. As the supplies of oranges at relatively low prices have increased, the output of orange concentrates has 11 o increased along ivith that of other by-products . "Dairy orange juice," as the trade has come to call it, is also an orange concentrate. It is referred to as a separate product in this report, hovrever, because of its comparative newness, its rapid rise to popularity, and its unknown market limitations. The name of the product is derived from the fact that it is marketed through milk-distributing organizations — another special character- istic of this particular orange concentrate. Although the exact make-up of the product varies with the concern manufacturing it, dairy orange juice is usually either a pure, concentrated orange juice or a concentrated orange juice blended, to standardize the color and flavor, with lemon juice and certified color. This concentrated product is shipped in large containers, usually gallon tins, to dairies all over the country, where it is combined with water at varying ratios, bottled, and either distributed house-to-house in conjunction v/ith milk delivery or sold to soda fountains, restaurants, grocery stores, and similar places. A half-pint bottle of the produce retails at the standardized price of five cents. Manufacturers of dairy orange juice consider their product competitive with other five-cent beverages. The results obtained in a survey of the manufacturers of orange by-products in California in February, 1936 indicate that ner.rly 36,000 tons of oranges were used in California in the manufacture of orange concentrates in 1935. Of this amount, about 12,600 tons, or 35 per cent, were used in the manufacture of the so-called "dairy orange juice," Assuming an output of 33.8 gallons of juice per ton of oranges, the average return obtained by the juice co.nners (see table 4), the pure- juice equivalent of orange concentrates manufactured in California in 1935 amounted to 3^,016,800 gallons. The juice which went into dairy orange juice was about 1,055,880 gallons and that which went into other orange concen- trates amounted to about 1,960,920 gallons. For a number of years scientists have been working on the problem, of perfecting some method for the preservation of pure citrus juices. Experiments have been carried on along both freezing and canning linos in an effort to develop a satisfactory method for preserving the product which would retain its natural flavor and at the same timo would permit extensive distribution mider conditions which are economically feasible. Many difficulties have been encount- ered in the process but none have as yet proven insurmountable. On the other hand, much progress has been made, some persons going so far as to contend that the problem has now been completely solved. Data concerning the volume and cost of oranges used in the manufacture of canned orange juice, and the pack of the product, in California in 1935 are given in table 4. Those values are based to a large extent upon the results obtained in the February, 1936 survey referred to above. Figures for earlier years are not given, because of the fact that the survey returns for those years were not considered sufficiently complete for that purpose. It is probably safe to say, however, that the volume of orange juice canned in California in 1934 did not exceed 40 per cent of the 19 35 pack and that the packs of earlier years were of inconsequential commercial importance. According to the figures given in table 4, 27,428 tons of oranges vrere purchased in California for the canning of pure orange juice in 1935. On the average, a price of |16.55 per ton was paid for this fruit. Thus the total value of the oranges used for this purpose amounted to 0453,933. The quantity of orange juice obtained from a ton of oranges varied widely among the canners, the weighted average figure being 83.8 gallons. Accordingly, the total canned TABLE 4 The Volume and Cost of Orangos Used in the Manufacture of Canned Orange Juice, and the Pack of Canned Orange Juice, California, 1935 Item Value Tonnage of oranges used (tons) 27,428 Total cost of oranges used (dollars) 453,933 Cost of oranges used, per ton (dollars) 16 e55 Total quantity of orange juice canned (gallons) 298,466 Quantity of orange juice canned per ton of oranges (gallons) 85.8 Cost of oranges used, per gallon of orange juice canned (cents) Pack of canned orange juice (equivalent 24-Gan cases of No . 1 cans ) 19o8 817,232 Percentage, by volume, of the pack in various size cans 8 Z cans 0,7 Picnic Nocl B cans 18,0 12~ounco cans 3 e6 No. 300 cans 7*5 No . 1 cans 59a No . 10 cans 8,8 Other size cans 2,3 Source of data: Estimates based upon the results obtained in a survey of the manufacturers of orange by-products in California in February, 1936 and upon data compiled by R. L. MacRao of the GroY/ers* Advisory Com- mittee, California-Arizona Citrus Marketing Agreement. ' f i j i 13. pack amounted to 2,298,466 gallons, or the equivalent of 817,232 cases of No. 1 cans at twenty- four cans per case « A very large proportion of the orange juice canned in California in 1935 was put up in the No. 1 can, which contains 15 ounces (table 4) « Nearly 60 per cent of the totad. volume of juice packed went into cans of this size. Another 18 per cent went into the so-called picnic or No. 1 eastern can which holds "between 9 and 10 ounces and is often referred to as the 10-ounco can. Nearly 9 per cent was put up in the large No. 10 can, containing 3 quarts, for the use of large-scale consumers. The Packs of Canned Fruit Juices Other than California Orange Juice The success of the citrus industry in selling the American people the idea of consuming their fruit in liquid form has "been a very important factor in the expansion of the market for all fruit juices. Moreover, the main competitors, from the consumers* standpoint, of oranges, a large proportion of which are con- sumed in juice form, have come to "be tomato juice, grapefruit juice, and pine- apple juice. As evidence of this fact, may it be noted that orange advertise- ments are no longer aimed at the baked apple and the stewed prune. They are directed at other fruit juices the output of which has, in recent years, become of sufficient importance to warrant a discussion in this report. Canned Tomato Juice Tomato juice and cocktail packs were first produced by several companies in the United States in the middle 1920 's as a means of utilizing the waste products from tomato canning operations. Hor-rever, as canners became more and more interested in the nev\r product and the use of waste material proved less satisfactory than was anticipated, increasing proportions of it have been made from the whole fruit. The federal biennial Census of Manufactures reports that in 1929 manu- facturers throughout the United States produced 185,000 cases of canned tomato juice (table 5). The beverage spurted to popularity in 1930, in company v/ith other fruit juices, and the production in that year amounted to a total of 1,338,964 cases. Since that time the annual output has continued to rise at a very rapid rate. The 1935 production has been estimated at 8,170,640 cases of cans of all sizes » Tomato juice, unlike most other fruit juices of commercial iraportance, is canned in large quantities in widely separated parts of the United States (table S). Of the estimated total 1935 pack of 8,170,640 cases, 13 per cent v/as canned in Ne¥f York, 9 per cent in Maryland and Delaware, 26 per cent in Ohio and Indiana, 14 per cent in California, and 38 per cent in other states. This fact has a significant bearing upon the competitive position of canned tomato juice in relation to other canned fruit juices. The distribution of the 1933, 1934, and 1935 packs of canned tomato juice in the United States, according to the size of container, is given in table 7, Although this distribution is not strictly comparable w-ith that given for Cali- fornia orange juice, since the latter was based on volume rather than numbers of cases and the volume of cases of different sized cans varies, there is some indication that tomato juice put up for consumption in the home has usually been TABLE 5 Canned Pack of Tomato Juice in the United States, 1929-1935 (Actual cases, of all sizes) Year Canned Pack cases 1929 185,000 1930 1,338,964 1931 3,476,244 1932 4,583,835 1933 4,170,794 1934 5,703,920 1935 8,170,640 Source of data: National Canners Association and U. S, Dept. Com. Biennial Census of Manufactures. TABLE 6 Canned Pack of Tomato Juice in the United States, by States, 1933-1935 (Actual cases, of all sizes) State 1933 1934 1935 cases cases cases Nev/ York 264,527 635,423 1,045,232 Maryland * 300,407 351,083 Delaware 314,070 424,847 New Jersey and Pennsylvania * 1,475,629 * Ohio 207,027 51,470 120,490 Indiana 1,137,741 1,663,586 1,980,981 California 386,007 1,014,508 1,153,064 Other states 2,175,492 248,827 3,094,943 Total 4,170,794 5,703,920 1 8,170,640 * Included in "other states." Source of data: National Canners Association. ] 4 i 1 I li 15. TABLE 7 Canned Pack of Toriiato Juice in tii.e United States, by olze of Container, 19o5-1935 (Actual cases) Size of conts.iner 1933 1934 1935 oases cases cases Wo . 1 E cans (cases of 48 cans) 566,991 1,609,120 2,329,994* No. TiCiCi nrifl '^n7> r*nn^ t' <^ p n-P 48 c.?jis) Boo, 619 634,250 215,642f Wo. 2 cans (cases of 24 cans) 209,783 762,441 799,191 Wo, 10 cans (cases of 6 cans) 550,230 862,751 1,174,012 Miscellaneous 1,576,912 1,400,102 2,683,929 Glass 433,259 435,258 967,872 GTotal 4,170,794 5,703,920 8,170,640 * Includes 211 x 400 and «ome 301 x 411. 1" Cases of 36 cans. Source of data: National Cannors Association. TABLE 8 Canned Pack of Ha-\7aiian Pineapple Juice, 1933-1935 (Actual cases of all sizes) Year Canned pack cases 193^ 700,000 1934 2,000,000 1935 2,500,000 Source of data: Estiiiiates given in Western Canner and Packer » Statistical Revievr W-umber. March 20, 1935 « p. 92 and in Western Crjiner and Packer, March, 1936. po 39. 16. canned in smaller-sized cans than, has orange juice canned in California. Canned Pineapple Juice Pineapple juice has been canned for many years on a small scale. Hovj-evcr, it V\ras not until 1933, after an improved type had been developed, that the pack assumed sizable proportions. At first, the entire pack of the juice was produced from the waste materials of the canning operations where, in cutting out the central cylinders of the fruit, some of the sweetest and juiciest fruit next to the husk was lost. In recent years the pack has been so large that portions of the fruit not generally considered as waste mater iaHs have been required. The estimated annual packs of canned pineapple juice in the Hawaiian Islands since 1933 are given in table 8. In two years the output has risen from 700,000 cases to 2,500,000 cases an increase of 257 per cent. Florida Orange and Grapefruit Juices The orange juice which is packed in Florida is so different from that canned in California as to warrant a distinction being made betv^eon the two juices. Inasmuch as the entire pack of tho California juice is of the summer orange, primarily the Valencia variety, the product is very sweet in taste and a deep orange in color. The Florida product, on the other hand, is pale yellow in color and has a tartness in flavor similar to that of grapefruit. Some canned Florida juice has appeared on the market v/hich is a combination of orange and grapefruit juices. During the 1929-30 canning season, 37,552 cases of orange juice were packed in Florida (table 9). From 1929-30 to 1933-34 the output fluctuated betv/eon 36,362 and 61,110 cases o It has been estimated that the 1934-35 pack amounted to about 175,000 cases of 24 cans. No, 2 size — a quantity over three times as great as the pack of the preceding year and 280 per cent greater than the average annual pack for the five years, 19 29-30 through 1933-34. The canned pack of grapefruit juice in Florida has been considerably larger than that of orange juice, averaging during the five years, 1929-30 through 1933-34, nearly ten times as large. In general, the grovrth of the Florida grape- fruit juice canning industry has paralleled the groYirth in orange ju.ice canning, at this higher level. The 1934-35 pack of Florida grapefruit juice has been estimated at 2,175,000 cases — an amount over five times as largo as the average for the preceding five years and over ten times as largo as the estimated pack of Florida orange juice in the same year. The distributions of tho 1933-34 Florida packs of both orange juice and grapefruit juice, according to the size of container, are given in table 10 ^ A very large proportion of the packs of both of these juices in that yeo.r was put up in the No. 2 can which contains 18 ounces. Other Canned Fruit Juices In addition to the large quantities of grapefruit juice canned in Florida in recent years, significant quantities are now being packed in Texas, Arizona, and California. No reliable statistical information on the size of the packs in these states is available. TABLE 9 Canned Packs of Orange Juice and Grape frriit Juice in Florida 1929-50 to 1934-35 (Converted to represent cases of 24 cans, No. 2 size) Canned pack. Canned pack. Year orange juice grapefruit juice cases cases 1929-30 37,552 173,934 1930-31 61,110 412,066 1931-32 36,362 247,652 1932-33 37,258 727,803 1933-34 57,678 610,115 1934-35 175,000* 2,175,000* * Subject to correction. Source of data: Florida Citrus Exchange. Statistical Bulletin. Season 1934-35. TABLE 10 Canned Packs of Orange Juice and Grapefruit Juice in Florida by Size of Container, 1953-34 Season (actual cases) Size of container Orange Grapefruit juice juice cases cases 8-ounce cans (cases of 48 cans) 1,596 6,727 8-ounce cans (cases of 72 cans) 41 12-ounce cans (cases of 24 cans) 7,670 67,668 300 X 407 cans (cases of 36 cans) 23,741 No. 1 cans (cases of 48 cans) 13,269 57,010 No, 2 cans (cases of 24 cans) 53,848 594,659 No. 5 cans (cases of 12 cans) 2,182 56,012 Source of data: Florida Citrus Exchange. Statistical Bulletin. Season 1933-34 0 18o Other canned fruit juices which have appeared on the m8.rket include prune juice, loganberry juice, lemon juice, and lime juice. Of these only prune juice and loganberry juice may be considered as competitive with orange juice, and the volume of these is so small that it is not much of a factor in the juice market. Both lemon juice and lime juice have special uses which put them in a class by themselves . The Relation of Canned Orange Juice to Fresh Oranges and to Other Canned Fruit Juices A large number of factors need to be taken into account in a discussion of the relation of canned orange juice to fresh oranges. From the consumer's point of view, there is the matter of "taste preference" for the product, of the relative cost of the juice obtained in the two ways, and of the comparative ease of obtaining, keeping, and using the two products. From the orange grower's standpoint, there is the all-important item of securing the largest possible net return for the product which he sells, considered from both the short- and the long-time points of view. Needless to say, the ansv'/er to the problem, locked at from the viewpoint of the grower, is, to a considerable extent, dependent upon the decisions which consiamers make. No evidence concerning the reaction of consumers in general toward canned orange juice is available at the present time. The results of the survey now being made in eastern markets by the Consumers' Counsel of tlie Agricultural Ad- justment Administration are expected to shed much light on this particular as- pect of the problm. In this report we shall have to omit a consideration of the influence of this factor, important as it is. The relative cost, to the c^cnsumer, of orange juice obtained from, a can and from the fresh fruit is, of coi:irse, dependent upon the price of canned orange juice, the price of fresh oranges, and the quantity of juice obtainable from fresh oranges, allowance being made for losses through spoilage. In table 11, some figures are given which indicate the quantities of oran.ge juice which may be expected from a dozen oranges with various juice-yielding ratios. For example, at the rate of 85 gallons of juice per ton of fruit, a dozen oranges of size 228 will yield 20 ounces of juice. Similarly, a dozen oranges of size 300 will, with a juice-yielding ratio of 95 gallons per ton, give 17 ounces. At a price of 20 cents per dozen for oranges v/hich v\rill give 20 ounces of juice, the cost of juice is, of course, one cent per ounce or 15 cents for 15 ounces, the content of a No, 1 can of canned juice (table 12). If oranges are priced at 40 cents per dozen and that quantity of fruit will give 30 ounces of juice, the cost of the juice is 20 cents for 15 ounces. The retail prices of oranges in Los Angeles, Chicago, and New York City, by two -week intervals, from A^igust 15, 19 33 to March 24, 1936, as compiled by the Bureau of Labor Statistics of the United States Department of Labor, are given in table 13, A graph of these prices appears in figure 4. The average retail price of oranges in Los Angeles during this period was 17 cents j in Chicago, 34 cents^ and, in New York City, 37 cents. Assuming, for the sake of illustration, that the oranges which retailed at the prices given in table 13 yielded 25 ounces of juice per dozen, the cost of 15 ounces of juice amounted, on the average, to 10.2 cents in Los Angeles, 20.4 cents in Chicago, and 22.2 cents in New York City. ?\Fith a juic e -yield ing ratio of 20 ounces per dozen oranges, the cost of juice was 12,8 cents per 15 19. TAELE 11 Quantity of Orange Juice per Dozen </ranges with Various Quantities of Orange Juice per Ton of Oranges and Various Sizes of Oranges Quantity of Size of oranges orange iuice (nimbor per 70- pound box) per ton of oranges 108 132 X vj 1 80 ?04 276 300 324 gallons ounces ounces ounces ounces ounc e s ounc e s ounces ounces ounces ounces 60 29.9 24,4 20,7 17.9 15.8 14.1 12.8 11.7 10.8 10.0 65 32.4 26,5 22.4 19.4 17.1 15.3 13,9 11,6 10.8 70 34.8 28.5 24.1 20.9 18.4 16.5 14.9 13,6 12.5 11.6 75 37,3 30.5 25.8 22.4 19.8 17.7 16.0 14,6 13.4 12.4 80 39,8 32.6 27.6 23.9 21.1 18,9 17.1 15,6 14,3 13.3 85 42.3 34.6 29.3 25.4 22,4 20,0 18.1 16.6 15,2 14,1 90 44,8 36.7 31.0 26,9 23.7 21,2 19.2 17.5 16.1 14.9 95 47.3 38.7 32.7 28.4 25.0 22,4 20.3 18.5 17.0 15.8 100 49*8 40 .7 34.5 , 29.9 26.4 23.6 21.3 19.5 17.9 16.6 105 52,3 42,8 36,2 31.4 27.7 24.8 22.4 20.5 18.8 17.4 Source of data: Calculations by the author. TABLE 12 Cost of Orange Juice per Fifteen Ounces with Various Quantities of Orange Juice per Dozen Oranges and Various Prices of Oranges Quantity of orange juice per dozen Price of oranges (coiits per dozer.i) oranges 15 20 25 30 35 40 45 50 55 60 ounces cents per " -5 oir./.ces 10 22.5 30.0 37.5 45.0 52,5 60.0 67,5 75.0 82,5 90.0 15 15,0 20,0 25.0 30.0 35,0 40.0 45.0 50.0 55,0 60.0 20 11.2 15.0 18.8 22.5 26.2 30.0 33.8 37.5 41.2 45.0 25 9,0 12.0 15.0 18.0 21.0 24.0 27,0 30.0 33.0 36.0 30 7.5 10.0 12.5 15,0 17,5 20.0 22 ,5 25.0 27.5 30 oO 35 6.4 8.6 10.7 12.9 15,0 17,1 19,3 21.4 23.6 25,7 40 5 ,6 7.5 9.4 llc2 13.1 15.0 16,9 18.8 20.6 22.5 45 5,0 6.7 8.3 10.0 11,7 13.3 15.0 16,7 18.3 20.0 50 4.5 6.0 7^5 9.0 10.5 12.0 13.5 15.0 16.5 18.0 55 4.1 5.5 6.8 8.2 9,5 10.9 12,3 13.6 15.0 16.4 Source of data: Calculations by the author. TABLE 13 20. Retail Prices of Oranges, Canned 'foraato Juice, and Canned Poaches in Los Angeles, Chicago, and Hew York City, oy TV/o-T-reek Intervals, August 15, 1933 to March 24, 1936 Oranges Canned toraato juice Canned peaches Date Los New York Los Nev; York Lo s Nevi York /mgeles Chicago City /mgole s Chicago City Angeles Chicago City r»pv> "t"<; per dozen cents per 13^;- ounce can cents per no. 2-|- can 1933 Aug o 15 . 17,1 31,5 38 ,4 « am Aug. 29 17.5 28 ,7 35*8 M mm mm " mm 14,1 18 .4 1 fr pn 15 .0 Sept. 12 17.7 29 .1- 36 ,5 p* «* mm mm M mm lo .7 1.8 .6 15 .3 Sept. 26 19.6 32 .2 37 ,2 ** — mm M 14,2 18 08 TP P\ 16 eO Oct a 10 18.8 31 .6 36,7 » M> 14 ,0 19 ,4 T C 0 1.5 ,8 Oct. 24 17,6 32 ,5 35 .6 M »-«■ "~ 14 .1 TO P\ 18,9 16 .1 Nov . 7 17.8 32 «0 39,3 mm 14,0 T P\ CT 19.5 TP P\ 16 .0 Nov. 21 18.3 30 ,4 34,8 mo am wm mm 14.0 TO 18.6 TP 0 15 .8 Dec . 5 18,5 29 .5 34 .3 13,8 T P\ P\ 19.0 T fT Pi 15 ,9 Dec. 19 17.2 2o • / 00,7 14.0 TO 0 18 08 15 ,9 1934 Jan. 2 19.9 oO.l 32,2 13.5 T Pi P" 19 . 6 TP 0 16 , 2 Jan . 16 18,5 31 .3 •7 T ^7 31 .3 ^ A f"7 14.7 T P^ ^7 19 ,3 1.6 ,3 Jan. 30 18.6 30 .0 31,9 8.6 9 .0 8,2 14 .8 T P\ 0 19 o9 TP 0 16,8 Feb. 13 18.5 29 .4 31 .8 8,0 9.3 8 ,4 15 .0 T P\ 19 .6 TP A 16 ,4 Feb. 27 17.5 29 *8 30,9 7,8 9 .2 8 .4 15 .2 T p\ r\ 19.9 16,5 Mar. 13 17.5 30,2 30,4 8 ,0 9,3 8,2 15 ,0 19 c9 16 .6 Mar. 27 15 . 9 30. 0 r-f /-\ <-S OV? « U 8 .4 9,2 8.2 T /I P) 14 .8 20.2 16 ,6 Apr. 10 15.8 31 .0 30,2 0.5 P\ 0 9 ,2 0 Pi *1 P P\ 20 ,0 ib ,41: Apr. 24 16.8 30 ,8 29 .6 8,6 Pv T 9.1 8,8 T /I P\ 14 ,9 oP\ 0 20,2 16,5 May 8 18.4 31.2 34.2 8.4 9,1 8.8 15,0 20,2 16.5 May 2 2 17 o6 37 .0 38,4 8,6 9,4 8.8 15 .0 19.6 16,7 June 5 17,9 38,7 38 ,5 8.5 9.2 8.7 15,4 20.3 16,5 Juno 19 16,1 42.7 43.6 8.4 9.0 9,2 15.4 20.2 16,7 July 3 17,9 42.7 43.7 9,4 8.9 9,4 15,3 20,4 16,9 July 17 17.5 40.3 42.7 9.3 8.9 9.1 15.0 20.4 17.0 July 31 16.9 40.3 42.6 9.3 8.9 9.1 15,4 20,6 17.3 15.4 37.9 44.3 9,3 8.8 9.2 15.4 20.9 17.5 Aug. 28 16.3 37.9 41.9 9.3 8.7 9.1 14.9 20.9 17.2 Sept, 11 16,8 40.5 42.8 9.5 9.0 9.0 15.8 21.2 17.3 Sept .25 16.0 38.8 43,0 9.1 8.9 9.0 16,2 20.9 17o4 Oct. 9 16.6 37,0 40.6 9.0 9.0 8,9 15.9 21.4 17.4 Oct. 23 22.5 43,3 49,8 8.6 8.7 8.4 16.4 21.2 17.4 Nov. 6 21.4 40.6 42.5 8,6 8.7 .8,5 15.7 21,7 17,5 Nov. 20 20 .0 36.1 40.5 8,7 8.9 8.3 15.7 21.5 17.7 Dec. 4 18.5 32.7 36,3 8,6 8.8 8.2 15.8 21,6 17,6 Dec. 18 17.1 31,2 33.5 8,5 8.6 8 .4 16.1 21,3 17,5 Continued on next page. Table 13 continued. 21. Orange s Canned tomato Juice Canned peaches Date Los Nev/ York Los Nev/ York Los Kew York jjn ge 1 e 3 j C h ic ago City Angeles Chicago City Ango lo G Chicago City cents per dozen cents per ISfy- ounce can cents per no « c Ir^j can 1935 Jan . 2 16*8 30.9 35.5 8.4 8.6 8.4 15,9 21.5 17.6 Jan. 15 16.0 30.8 34.8 8.4 8.6 8.4 16o3 21,8 17.6 Jan. 29 17.0 52.8 27.0 8.5 8,6 O « -c 16.3 21.6 17.7 Feb. 12 19.7 31.1 34.2 8.6 8.6 8.2 16,3 21.6 17.6 Feb. 26 18.0 31.7 35.4 8.3 8.5 8.3 16.6 21.8 17.7 Mar. 12 18.6 30.9 34.4 8.4 8.9 5.3 16,6 21.8 17.9 Mar. 26 18,2 31.8 34.3 8.3 8.6 8.3 16.7 22.2 17.8 Apr . 9 19.8 35.4 3 o .5 8.5 8.8 8,3 16,6 22.2 17.8 Apr. 23 20.4 35,7 38.0 8«4 8.7 8,3 16.4 21.8 17,8 Ma.y 7 23,0 35.7 37.4 8,4 8c8 8.2 16.3 21.8 17.9 May 21 25.9 35 .6 36.3 8,4 8.8 8.2 16.0 22.3 17,8 June 4 18.2 32.9 39.3 8.4 8.8 8.2 17,2 21.7 17.6 June 18 17.2 32.2 38,0 8.5 8.8 8.2 17,2 21.9 17.7 July 2 21,2 31.3 35,1 8.5 8.8 8.1 17.1 21.8 17.7 July 16 15.0 32,9 36.5 8.4 8.8 8,3 16,3 21.6 17.8 July 30 14.6 34.3 39,2 8.5 8,7 8.3 16.3 21.5 17,9 Aug, 13 14 .7 3 3 o (3 35.8 8.6 8.6 8.3 16.1 21,6 18.0 Aug. 27 13.7 32.8 36,9 8,4 8.3 8e2 16.2 22.0 18.1 Sept .10 14.3 37.3 41,2 8.5 8.9 8.0 16.4 22<.9 18.0 Sept. 24 14.1 35.5 43.6 8.1 8.9 7.9 16.4 22.7 17,7 Oct. 8 15.3 35 .7 38.9 8.2 8,7 8.2 16,0 22.7 17.7 Oct. 22 13.9 36.3 41.6 3.2 8,7 8.2 16,2 22,5 17.6 Nov. 5 13.5 35 , 3 40.8 -~ — 15.7 22.4 17.6 Nov. 19 14.0 35,9 39.0 — — 15.5 21.5 17.3 Dec. 3 15.9 36.0 37.8 MM (M « mm 15 .6 21.9 17.4 Dec. 17 14.4 36.0 37.6 15 ,3 21.9 17.4 Dec. 31 17.1 34.0 35 .1 8.4 8,4 8.0 15.5 22.1 17.4 1936 Jan. 14 16,8 33.6 35,0 8.4 8.3 8,3 15.6 22,1 17.6 Jan. 28 16.1 34.0 35.5 8.3 8,3 8.2 14.9 22,0 16.9 13.8 33.3 35.7 8.3 8.2 8.1 14,6 21,1 17.0 Feb. 25 13.9 34,0 36.4 8.2 8.2 8ol 14.7 20.7 16.9 JIar. 10 13.7 34.7 34.5 8.2 8cl 7.9 14,3 21.1 17.0 Wlar. 24 12.5 33,1 33.6 8,2 8.1 8.0 14.2 21,1 16.7 Source of data: U. S. Dept. Labor. Bur. Labor Stat is . Retail prices principal articles of food by cities. 22. Price ( cents per dozen) 50 40 30 20 10. New York City \/Uhicago Los Angeles J. ± ± Week Aug, 15 Jan. 2 May 22 Oct, 9 Feb. 26 of; 1933 1934 1934 1934 1935 July 16 Dec, 3 Apr, 21 Sept. 1935 1935 1936 1936 Fig. 4»— RtJtail prices of oranges in Los Angeles, Chicago, and New York City, by two-week intervals, August 15, 1933 to March 24, 1936. r E3. ounces in Los Angeles, 25.5 cents in Chicago, and 27.8 cents in Nev^r York, The very wide differences in the prices which consumers pay in different parts of the country for juice reamod from fresh oranges are due, in part, to variations in distribution costs, such as transportp.tion, and, in part, to variations in the quality of the product. Fruit shipped from California to IJevr York City, for example, must "boar heavy charges for freight and refrigeration, and in order to do this, it must be fruit of a high quality v/hich will sell for a price sufficiently high to at least cover these large fixed charges. Oranges sold in Los Angeles, on the other hand, do not need to bo packed, do not have high transportation costs assessed against them, and consequently may be low- grade fruit which sells at a low price. No information is available concerning the differences, geographically, in the retail prices of canned orange juice. Some basis for inferring what these differences might be is, however, provided by data relating to canned peaches. California earned orange juice and canned peaches are analogous in the sense that both are canned products packed entirely, practically speaking., in the state of California and hence have similar distribution costs. The retail prices of the No, 2%; can of carcied peaches in Los ^Vngeles, Chicago, and New York City, by two -week 'intervals , from August 29, 1933 to March 24, 1936, arc given in tabic 13, and shovm graphically in figure 5. Durir^ this period, the prices which consumers paid for canned peaches averaged 15.4 cents per can in Los Angeles, 21,0 cents in Chicago, and 17.1 cents in New Yorkc The price difference betvreen Los Angeles and Chicago was 5 ,6 cents per c^ (36 per cent of the Los Angeles price) and botv/eon Los Angeles and Now York City, it was 1.7 cents per can (ll per cent of the Los Angeles price). In the case of fresh oranges the price difference betvroen Los ^ngeles and Chicago was 17 cents per dozen (lOO per cent of the Los Angeles price) and betifveen Los Angeles and New York City, it v\ras 20 '"3nts per dozen (ll8 per cent of the Los Angeles price). Assuming that the same absolute differences in retail prices betv/een Los Angeles and Chicago and between Los Angeles and Nov\r York City vrould main- tain for canned orange juice as existed for camiod peaches, a No « 1 can which retails for 10 cents in Los Angeles might bo expected to sell for 15.6 cents in Chicago and for 11.7 conts in New York. With the same percentage relation- ships maintaining for cannod oran[',e juice as for canned poaches, the can of orange juice retailing for 10 conts in Los Angeles would retail for 13.6 conts in Chicago and for 11.1 cents in Now York. If one dozen oranges yields 20 ounces of juice and this fruit sells for 17 cents in Los -A-ngelos, 34 cents in Chicago, and 37 conts in Now York, the cost of 15 ounces of the juice is, as stated before, 12.8 cents in Los Angeles, 25.5 cents in *^hicago, and 27.8 cents in Now York. If a 15-ounce can of juice should sell for 12.8 conts in Los Angeles, one vrould oxpcct, inferring from the aforementioned analogy, that the price in Chicago would bo somewhere between 17.4 and 18.4 conts per can; and in Now York, botvroen 14.2 and 14.5 conts. Thus, it may be seen that the relative cost to the consumer of orange juice secured from fresh oranges and from a can may be expected to vary considerably in different parts of the country. The third factor which needs to be talcen into account in a discussion of the relation of canned orange juice to fresh oranges, from the consumer's point of view, is the comparative ease of obtaining, keeping, and using the two prod- ucts. While it is true that fresh oranges are now obtainable in nearly every grocery store in the United States throughout the year, there are times vj-hen, in 24. Price (cents per number 2-^ can) Week of:Aug,15 Jan.S May 22 Oct. 9 Feb, 26 July IS Dec. 3 Apr. 21 Sept. 8 1933 1934 1934 1934 1935 1935 1935 1936 1936 Fig, bo-- Retail prices of canned peaches in Los Angeles, Chicago, and New York City by two-week intervals, August 29, 1933, to March 24, 1936,, 25. many places, good quality oranges are unobtainable, except at prices which are so Mgh as to greatly curtail consujfiption. The extent to which the quality of canned orange juice can be expected to approximate that of freshly extracted juice and to remain at a sufficiently high level is, as stated before, a matter for wiiich there is no basis of discussion in this report. It may bo expected, hovrever, that the canned product can be made more readily obtainable than fresh fruit at prices which exliibit less seasonality. Tho comparative ease of using the product is a factor v^rhich operates in favor of canned juice. For most house- vj-ives, at least, opening a can is a much easier function to perform than ream- ing fresh oranges, whether this reaming is done by hand or by machine. The relation of canned orange juice to other canned fruit juices should be brought out more fully in the report v;hich the Consuuiers' Counsel of the Agricultural Adjustment Administration will make than can be given in this re- port. However, although no factual informtion is available concerning the competition v/hich canned tomato juice, canned pineapple juice, and canned grape- fruit juice offer oranges, it is inconceivable, in viev/- of tho rc.pidity with which the output of these products has increased, that they are not, in some degree, affecting the demand situation for tho orange v/hich is consumed, to a large extent, as a juice. Y^hethor or not the availability of canned orange juice will in some measure counteract this influence is still another matter » Some evidence of the competitive position, from a price standpoint, of canned tomato juice and fresh oranges can be obtained from the data given in table 13, As indicated above, the avoro.ge retail prices of oranges in Los Angeles, Chicago, and New York City, during tho period covered, were 17 cents, 34 cents, and 37 cents per dozen, respectively. Comparable prices for canned tomato juice wore 8,5 cents per 13-|- ounce can in Los Angeles, 8.8 cents iu Chicago, and 8.4 cents in IJow York (sec figure 6), No basis is provided for determining tho absolute com.petitive relationship botv/eon oranges and canned tomato juice in any one of these cities, but it is evident from those figures that canned toraato juico is in a much more favorable situation, from the price standpoint, in Chicago and New York than in Los Angolos. If, in a consumor's mind, canned tomato juico at 8«5 cents per can is equivalent to oranges at 20 cents per dozen, his choice, undor tho conditions as stated, would be oranges in Los Angeles and tomato juico in either Chicago or Noyj- York. (This statement, as it stands, rather overstates the definitenoss of consumers' decisions, but it illustrates tho point v^rhich the author wishes to malce . ) The relation of canned orange juico to fresh oranges and to other canned fruit juices, considered from tho standpoint of its effect upon not returns to orange growers, involves many factors concerning which there is little basis for prognostication. Can one assume, if no orange juico is canned, that the not returns to growers for fresh oranges will, during either tho next few years or tho next docade, be in line v/ith tho net returns obtained in past years? Can one assume that the canning of orange juice T/ill result in a changed demand for the product vin. ich will affect the not returns received by growers for tho fruit? If so, in what direction may this force be expected to operate and v/hat results may be anticipated? During the 1935 season, cani\ers of orange juice purchased 27,428 tons of summer oranges in California at a prico of Vpl6.55 per ton (table 4). At the same time growers received ^11.41 per box for summer oranges delivered at the packing house door (table 2). This latter figure, converted to prico per ton, amounts to ^40.28, Some may bo inclined to consider this discrepancy as an indicator of the relative prices which growers may oxwct to receive for fruit 26. 1_ Week Aug, 15 Jan, 2 of: 1933 1934 22 Oct.. 9 Feb. 26 July 16 Dec, 3 Apr. 21 Sept, 1934 1934 1935 1935 1935 1936 1936 Fige 6. — Retail prices of canned tomato juice in Los' Angeles, Chicago, and New York City, by ti/vo-week intervals, January 30, 1934 to March 24, 1936, 27. sold as fresh fruit and to canneries. There is a fallacy in such reasoning, how- ever, inasmuch as the price received for the former fruit is somewhat higher than it otherwise would have "been, due to the diversion of a large portion of the available supply to by-products channels, includirg that used in the manufacture of canned juice., A true comparison of the relative net returns to growers for oranges mar- keted as fresh fruit and as canned juice can only be made when the comparison is made on the same base. Supposing, for example, that in a given year, the total crop of oranges amounts to 20,000,000 boxes of 70 pounds each, or 700,000 tons. If 10,000,000 boxes are sold at a net price to growers of ^fjJl.OO per box, the net return on that portion of the crop is, of course, |;10,000,000 . If the additional 10,000,000 boxes, or 350,000 tons, are disposed of to canners for $7,000,000 net to growers ($20 per ton), the total net return is .tpl7,000,000 . If, however, the total crop had been put on the market for sale either as fresh fruit or as a canned product, the total return might have been either greater or less, depending upon the relative demands for the two products. for For the fruityiA^iich in 1935 growers received an estimated price of $1.41 per box, delivered to the packing house, consumers have been paying in the neighborhood of $5.00 to $6*00 per box. For the canned juice manufactured from the oranges -vrfiich canners purchased at $16.55 per ton, consumers have been pay- ing from 9 to 13 cents for 15 ounces. Assuming the average quantity of juice obtainable from a 70-pound box of oranges as 375 ounces (the average quantity obtained by canners in 1935), consumers have been paying from 20 to 24 cents for 15 ounces of the juice which they have reamed from fresh fruit. Thus, while growers have been receiving in the neighborhood of $24 more per ton for oranges sold as fresh fruit than for oranges sold to canners, consumers have been paying from 7 to 15 cents more for 15 ounces of fresh orange juice than for that quan- tity of the canned product. When this difference of 7 to 15 cents per 15 ounces is converted into additional price to growers for oranges sold to canners, other factors remaining the same, it amounts to considerably more than the $24 re- ferred to above. Hence, if consumers should be willing to pay as high a price for juice obtained from a can as for juice extracted from fresh fruit, and to purchase as much of the product at that price as they would fresh oran.ges, it would appear from the foregoing that larger net returns to growers v/ould result from selling oranges in cans. Thus after all is said and done, the relative profitableness to growers of marketing oranges as fresh fruit and as canned orange juice depends, to a considerable extent, upon the consumer. Definite Conclusions Unwarranted The author has carried the analysis of this problem as far as he feels the present available facts in the case have warranted. Canned orange juice is a new product for which the demand is an unknoam quantity. Until the product has been on the market for some time, it is impossible to make very accurate estimates of the levels of prices at which given quantities can bo soldo It is hoped, however, that the facts presented in this report will be of some help to those who must, of necessity, make decisions regarding the relationships involved and that the discussion will serve to clarify, at least in some small measure, the thinking on the problem. After the report on the consumer survey has been issued and as additional information concerning the problem becomes available, conclusions somewhat more definite than those presented heroin may be xvarranted.