mmmiMy:^,^:miJy:A CALIFORNIA SPINACH ECONOMIC STATUS 1948-1949 . . «. , CALIFORNIA ACREAGE — 9500 ACRES CALIFORNIA YIELD- 4 TONS PER ACRE CALIFORNIA PRODUCTION 38,000 TONS This CIRCULAR, reporting trends in the SPINACH industry during 1919—48, concerns • PRODUCTION • ACREAGE • YIELDS •USE and • PRICES Tables and figures appearing in this circular are sum- maries of more detailed tables which are published in a separate Statistical Supplement. This supplement gives sources in detail and may be obtained by writing the Giannini Foundation of Agricultural Economics. THE AUTHORS: Sidney Hoos is Associate Professor of Agricultural Economics, and Associate Economist in the Experiment Station and on the Giannini Foun- dation. P. C. Habib, formerly Research Assistant on the Giannini Foundation. ^flCft&CvL has long been a major truck crop. Its adaptability to use in fresh, canned and now frozen form has given it a wide market. Wide distribution is possible and profitable because spinach can be handled in volume under varying conditions. In recent years, no other food item has received more publicity on nutri- tional values. Although acreage planted to spinach has greatly expanded in the last twenty-five years, the war years brought even greater expansion in both acreage and production. But since 1946, acreage and production have gone back to nearly pre-war levels. Post-war farm prices continue at a high level owing to reduced production and increased demand. PRODUCTION Nations long-time production trends influenced by 1930-32 depression and World War II California has shown slight increasing trend and stable production level Spinach production in the U. S. in- Two Events Mark Production creased steadily and significantly from • • 1918 to 1929. This trend was followed by a severe reduction in 1930. Production The depression years of the early later rose steadily during 1932-1937, but 1930's serve as a dividing line between tended downward again until the ap- the rapid expansion during the 1920's proach of the war. With the great war and the more gradual rise in the post- demand, particularly for canned spinach, depression period. production remained at a high level. The The long-time trends in production are end of the war was followed by a general affected by the extraordinary influences decrease in production. In 1948 it was of both the great depression and World below both the average of 1935-19.39 and War II. This cannot be lost sight of in the war years. any consideration of production trends. [3] FIGURE 1 Spinach Production in the U. S., 1919-1948 (thousands of tons) 200 100 200 100 1920 1930 1940 Production increases since 1919 and during the 1920's are the result of greater demand for spinach due to increasing population, expanding income, and grow- ing consumer acceptance of the product. Has Demand Reached Its Peak? Some may believe that demand has already reached its peak, and that a grad- ual leveling off is indicated because of a change in consumer tastes and increased availability of many other vegetables. But future prices, methods of marketing and population changes do not preclude fur- ther expansion of the industry. California's Production Trend Production in California has shown only a slight increasing trend since the middle 1920's. With the exception of a few years, a relatively stable production trend has been maintained. This trend has been characterized by fairly sharp fluctuations, but in general these have balanced themselves and resulted in a stable production level. Calif ornia's Share of Nation's Crop Spinach is grown in many states. The rapid expansion of output was a result of increased production outside Califor- nia; in the East and South (fig. 1). During 1920-1924, California pro- duced 43 per cent of the country's total spinach production, but by 1940 its share had fallen to 19.7 per cent. During the war years, California in- creased its share of national output, un- doubtedly due to the increased demand for processed spinach. In 1946, California was producing 30.4 per cent of the total spinach production, but by 1948 its share had dropped to 23.3 per cent. [4 California Crop Winter-produced Commercial spinach production in California takes place only in the winter season. The crop is harvested from about December 15 to April 1. Other areas produce spinach at differ- ent seasons, depending upon climate. Winter-produced spinach is the most important source of fresh market spinach. In 1948, 46 per cent of U. S. fresh market production was harvested during the winter. Spring is the next most important sea- son, followed by summer, early fall and late fall; in that order. ACREAGE Nation's trend upward until 1945 with strong decline 1945-1948 California acreage fluctuated around a level trend since 1929 Other states have expanded acreage The underlying reasons for the trends in spinach production are found in the behavior of acreage and yields. Following World War I, the total spin- ach acreage in the U. S. increased rapidly (fig. 2). The upward trend continued until 1944, although there were severe acreage reductions in 1930 and during 1938-1939. During 1946-1948, there was a steady decline in total acreage. California Acreage During the period of rapid expansion in U. S. spinach acreage up to and includ- ing 1929, California's acreage also ex- panded, but not so rapidly. Since 1929, California acreage has re- mained fairly constant with only periodic fluctuations. This has resulted in a steady decrease of California acreage as a per cent of the total. During 1920-1924, Cali- fornia had 28.1 per cent of the total acre- age, but by 1948 it had only 11.6 per cent. Acreage of Other States Texas has a large acreage in spinach (table 1 ) . Producing mainly for the fresh market, Texas acreage expanded rapidly until the middle 1930's. At that time 50 per cent of the total U. S. spinach acreage was in Texas. In both California and Texas, acreage has not shown any significantly rising trend over the past ten years. The U. S. increase was a result of acreage expansion in other areas. Much of this was in states close to the main eastern markets. Acre- age in all states, other than California and Texas, rose from almost 11 million acres in 1920-1924 to 56.8 million in 1943. It dropped to 35.1 million in 1948. Where California Spinach Is Grown In California, spinach acreage is con- centrated in three main regions. These are: [5 FIGURE 2 Spinach Acreage in the U. S., Texas and California, 1918—1 948 (thousands of acres) 120 120 1920 1930 1940 TABLE 1 Spinach Acreage (acres) 1920-1948 Period or year U. S. California Texas All other states Averages 1920-1924 26,198 53,698 65,318 93,454 86,240 82,990 117,020 113,180 . 117,450 102,180 103,470 86,040 81,010 7,346 13,114 9,774 14,620 12,740 10,440 18,090 12,930 14,930 14,420 13,990 10,810 9,400 8,058 20,992 32,642 46,760 37,900 39,900 48,800 43,400 48,400 41,500 43,000 39,400 36,500 10,794 19,592 22,902 32,074 35,600 32,650 50 130 56,850 54,120 46,260 46,480 35,830 35,110 1925-1929 1930-1934 1935-1939 Annual 1940 1941 1942 1943 1944 1945 1946 1947 1948 [6] 1. The northern counties of the Cen- tral Valley. 2. The coast counties south of San Francisco. 3. The Los Angeles area. The leading counties are Monterey, Los Angeles, Stanislaus, and San Joaquin. Fifteen other counties trail with small acreages. The four leading counties have 67 per cent of the spinach acreage in the State. During the past twenty years, there has been a shift in the California acreage. In 1928, Sacramento, Santa Clara and Ala- meda counties had 57 per cent of the California acreage, but by 1947 they had only 6 per cent of the California total. Los Angeles County raises spinach al- most exclusively for the fresh market. The other major producing counties concen- trate on the processing markets. YIELDS U. S. yield per acre fairly stable since 1 933 California yield per acre highest in the U. S, While there was a rapid expansion in From 1930-1933 the U. S. yield per acreage and production during 1918- acre fell off rapidly. Since then the aver- 1929, the yield per acre followed a slowly age yield has been fairly constant, declining trend (fig. 3). FIGURE 3 Spinach Yields in the U. S., Texas and California, 1918-1 948 (bushels per acre) 900 600 300 1 \ \ \ \ V i i \ ( ' - / \y — CALIFORNIA \ V \ '\ . v\ - \ UNITED STi V^ ^ \ A^-TEXAS V K ^.^.< — i i i i i i i i i -A / V* 1 I f \ / \ 1 1 1 1 1 1 1 1 1 i i i i 1 i i 600 300 1920 1930 1940 [7 In California, there has been constant fluctuation with the indication of a rising yield trend over the past ten years. It is significant that California's yield per acre of spinach has always been much greater than in the U. S. as a whole. Dur- ing 1935-1939, the average yield in Cali- fornia was 400 bushels per acre, whereas the U. S. yield was only 226 bushels (table 2). Comparing California to Texas, the yield differences are large and readily apparent (table 2 and fig. 3) . California's average yield has been as much as two to four times more than the Texas yield. Spinach production and acreage have followed the same general trends since 1920. Despite exhibiting a decreasing trend, yields were high during the 1920's and production increased because of a rapidly expanding acreage. However, dur- TABLE 2 Spinach — Yield per Acre (bushels per acre) 1920-1948 Period or year U.S. California Texas Averages 1920-1924 . .. 405 621 284 1925-1929... 359 553 293 1930-1934 ... 272 510 200 1935-1939 .. 226 400 127 Annual 1940 222 296 139 1941 217 400 145 1942 235 397 153 1943 212 416 133 1944 228 473 148 1945 238 470 148 1946 228 514 122 1947 214 431 126 1948 223 448 137 TABLE 3 Utilization of U. S. Spinach Production (thousands of pounds) 1933-1948 Period or year Total production" Fresh Canned Frozen Average 1933-1936 1937-1940 Annual 1941 347,029 370,630 323,854 495,524 432,776 480,708 437,980 424,894 331,338 325,386 251,764 250,998 191,224 226,221 194,209 173,408 155,308 144,164 191,293 124,547 95,265 112,386 123,656 239,170 185,529 248,924 215,913 211,206 97,724 125,262 c 7,246 8,974 30,133 54,038 58,376 66,759 69,420 42,321 75,577 1942 1943 1944 1945 1946 1947 1948 a Does not include production not marketed, b Farm weight. « Not available. [8] ing the early 1930's production did not maintain an increasing trend although acreage did. This was due to a substantial drop in yield per acre. In the last ten years, yield per acre has been relatively stable and changes in pro- duction have followed acreage changes very closely. UTILIZATION U. S. crop marketed fresh, canned, and frozen California crop mostly used for processing Spinach is marketed in three forms; fresh, canned and frozen. Fresh Spinach. U. S. production going into fresh use declined during 1936-1941, rose slightly in 1942, and then declined steadily until 1946 (fig. 4 and table 3). In 1947, there was a strong increase in fresh use. Whereas 34 per cent of total production in 1946 went to fresh use, it increased to 58 per cent in 1947. Canned Spinach. In contrast, the use of spinach for canning maintained a ris- ing trend until 1945, with canned use being greater than fresh use in four out of five years during 1942-1946. However, canned use fell significantly in 1947, when only 30 per cent of total production went to canning compared to almost 50 per cent in 1946. FIGURE 4 Utilization of U. S. Spinach Production, 1933—1948 (millions of pounds) 300 200 100 - ^^^ f\-~£~" tESH — * CANNED -7 x/y V / >v / ^^ / ^ / -/ \ A ^^/ V \ \ v 1 1 -ROZEN-x , .> -• — •> i i 1 «••— y— p— -- | | | | 300 200 100 1935 1940 1945 [9 FIGURE 5 Utilization of California Spinach Production, 1933-1948 (millions of pounds) 100 75 50 25 / \ / \ / / / / / / / S> V'V/- CANNED \ v \ \ \ ' * / / v / / / / \ \ \ \ 1 ^V\- / / t /\ x-FRESH 1 1 1 L M ,.X'*'^»«ti ■ROZEN-x ..' \ • V 100 75 50 r 25 1935 1940 1945 In 1948, the distribution to canning returned to the 1946 level. Frozen Spinach. Data on the use of spinach for freezing are available only since 1937 when 1.8 per cent of total U. S. production was frozen. Since 1941, spinach production used for freezing has increased significantly. In 1947, 12.8 per cent of total production was frozen. It should be noted, however, that compared with a high of almost 35 thousand tons (farm weight) frozen in 1946, only 21 thousand tons (farm weight) were frozen in 1947. This reduc- tion may well have been due to the large 1946 pack and the subsequent large carry- over, and loss of the Government as an important purchaser. In General. Spinach production used for processing has become increasingly important. During 1937-1940, 32 per cent of total production was used proc- essed. By 1946, 66 per cent was used processed. In 1947 it had fallen to 42 per cent. Undoubtedly the war demand for canned vegetables for overseas shipment influenced the utilization trend. It now appears that we are returning closer to pre-war utilization, as evidenced by the situation in 1948. Utilization in California In California, the trend in the use of spinach production for the fresh market was steadily down until 1946 (fig. 5). But in 1947, the quantity used fresh in- creased considerably in spite of the sharp decrease in total production (table 4). Canned use has been considerably greater than fresh, except for 1938 and 1947. Frozen use increased significantly from 1942-1946. It then fell to a very low point 10 in 1947 but recovered again in 1948. In 1948, both canned and frozen use rose above the previous year. In terms of per cent of total California production, it is evident that the major use has been for processing. The share of California production going to canning increased until 1946. Of total state production, 73 per cent went to canning in 1946 compared to an aver- age of 59 per cent during 1933-1936. In 1947, production canned declined to half the 1946 level. Only 50 per cent of the total crop was canned. Although California spinach used fresh declined from 41 per cent of the total state output during 1933-1936 to 13 per cent in 1946, it is significant that 46 per cent of total output in 1947 was used fresh. The 1947 utilization pattern was not continued in 1948. In 1948, canned use increased to 58 per cent of total production while fresh use declined to 24 per cent. Significant changes have been evident in the use of spinach for freezing. This use became important in California in the late 1930's and increased to a great extent during the war. In 1946, as much as 14 per cent of California production was frozen. Along with the reduction in canning in 1947, there was a sharp reduction in the quantity of spinach frozen. Only 4 per cent of California production went to freezing. In 1948, the frozen pack increased sig- nificantly with 18 per cent of total Cali- fornia output being used. Although a significant proportion of California spinach is marketed in frozen form, it is still much less than the volume of California spinach canned. TABLE 4 Utilization of California Spinach Production (thousands of pounds) 1933-1948 Period or year Total production Fresh Canned Frozen Average 1933-1936 1937-1940 Annual 1941 110,755 85,636 75,100 129,356 96,760 127,060 122,082 129,316 83,818 75,808 45,853 35,872 20,781 37,159 18,884 21,900 23,120 16,547 38,283 18,106 64,902 49,301 53,602 89,088 70,151 89,113 83,664 94,462 42,017 43,970 b 464 727 3,109 7,725 16,047 15,298 18,307 3,518 13,833 1942 1943 1944 1945 1946 1947 1948. a Farm weight. b Not available. [11] CANNED SPINACH Declined after heavy war demand and slumped badly in 1947 California losing ground to other states Pack-year 1 949-50 begins with low carry-over Total Pack The total U. S. canned pack has varied considerably since 1929 (fig. 6). Following the very low pack of the early 1930's, output began to rise stead- ily. A cut-back occurred during the 1938 business recession, but from here on the war influence caused output to rise rap- idly. It reached a high of almost 10 mil- lion cases (24 No. 2's) in 1944. Total pack fell off to slightly less than 8.5 mil- lion cases in 1946 due to war's end. It then fell off sharply to 3.9 million cases in 1947, and rose to 5 million cases in 1948. California Pack There has been a significant shift in the pack by states (fig. 7 and table 5) . In 1933, California supplied 65 per cent of the total U. S. pack, but by 1947 it supplied only 43 per cent. The Missouri-Arkansas region has be- come increasingly important. Thirty-one per cent of the total 1947 pack came from these states. Thus, during the years when the total pack was increasing consider- ably, a greater share was coming from regions outside California in spite of the generally increasing trend of California canned pack. FIGURE 6 Canned Spinach Pack in the U. S., California, Missouri and Arkansas, 1929—1948 (millions of cases, 24 No. 2's) 10.0 1 1 1 1 K 1 1 10.0 2.5. From the latest statistics available, it seems that other regions will continue to maintain their share of the total pack. Shipments The trend in U. S. packer shipments of canned spinach has been upward since 1934. A sharp rise occurred after the out- break of war (fig. 8). Since the end of the war, a good deal of packer shipments went to replenishing inventories depleted during the war. Shipments going to export and war services (armed forces and lend-lease) became significant in 1941. They reached a peak of 3.6 million cases in 1944^1945. This was 39 per cent of total shipments. In 1946-1947, shipments to export and war services fell to one million cases, or 12 per cent of the total. Thus, while ship- ments to civilians increased in 1946- 1947, there was a sharp reduction in ex- ports. TABLE 5 Canned Spinach Pack (thousands of cases, 24 No. 2's) 1933-1948 Year California U. s. 1933 1934 2,069 2,564 3,043 2,708 2,949 1,335 1,901 1,704 2,144 3,564 2,806 3,565 3,347 3,778 1,681 1,759 3,179 3,602 4,318 4,143 6,136 2,883 4,000 4,962 4,946 9,567 7,381 9,957 8,637 8,448 3,909 5,011 1935 1936 1937 1938 1939 1940 1941 1942 1943 1944 1945 1946 1947 1948 FIGURE 7 Canned Spinach Pack; Percentage Distribution Between California and Other States, 1933-1948 (per cent) 100 100 In view of the small 1947 pack, it is indicated that shipments during 1947- 1948 were much lower than in the previ- ous high-pack years. The annual movement of California canned spinach dropped from 3.3 million cases (24 No. 2's) in 1947 to slightly less than 2 million cases in 1948. This was below the 1935-1939 average, and evi- dently a result of the low 1947 and 1948 packs (fig. 9). Carry-over The carry-over may be linked to the general economic level. Normally, some stock will be held on hand by the packers. During a period of high business activity, carry-over will shrink. In depression peri- ods, particularly following a sharp reces- sion, the carry-over will be large (figs. 8 and 9. Table 6). During the period of recovery after the depression, carry-over remained about the same from 1934^1937 but the busi- ness slump of 1937-1938 caught the pack- ers with an increased pack on hand. This resulted in a large carry-over for 1938- 1939 of 1.9 million cases (24 No. 2's). Following this, there was a return to nor- mal carry-over sufficient for working stocks. The War Influence At the beginning of the war, the pack took a sharp leap upward. It approched 10 million cases during 1942-1943. This was due to the heavy government demand which provided an immediate outlet for the pack. The carry-over for 1942-1943 and 1943-1944 (fig. 9) were stocks held pri- marily for government use. Even these vanished in 1944-1945 as increased ship- ments rapidly moved the pack. The packers' carry-over began to re- appear after the war, but the pack year 1949-1950 will begin with a low carry- over compared to other peace-time years. The California Carry-over The carry-over in California has tended to follow the general trend except for a FIGURE 8 U. S. Canned Spinach; Pack, Packers' Carryover, and Packers' Shipments, 1934-35 to 1948-49 (millions of cases, 24 No. 2's) 1935-36 1940-4 [ 14 TABLE 6 U. S. and California Pack, Packers' Carry-over and Packers' Shipments of Canned Spinach (thousands of cases of 24 No. 2's) 1934-1950 Year (starting March 1) u. s. California Carry-over Pack Shipments Carry-over Pack Shipments 1934-35 400 500 400 400 1,900 900 600 400 300 1,400 100 600 1,200 3,602 4,318 4,143 6,136 2,883 4,000 4,962 4,946 9,567 7,381 9,957 8,637 8,448 3,909 4,989 3,502 4,418 4,143 4,636 3,883 4,300 5,162 5,046 8,467 8,781 9,857 8,137 7,848 325 285 234 220 737 335 207 116 227 74 121 124 122 630 343 54 2,564 3,043 2,708 2,949 1,335 1,901 1,704 2,144 3,564 2,806 3,565 3,347 3,778 1,681 1,759 2,604 3,094 2,722 2,432 1,736 2,029 1,794 2,032 3,717 2,758 3,562 3,348 3,271 1,967 2,048 1935-36 1936-37 1937-38 1938-39 1939-40 1940-41 1941-42 1942-43 1943-44 1944-45 1945-46 1946-47 1947-48 1948-49 1949-50 FIGURE 9 California Canned Spinach; Pack, Packers' Carryover and Packers' Shipments, 1934-35 to 1948-49 (millions of cases, 24 No. 2's) 1940-4 945-46 [15] small carry-over maintained during the war. After the war, the carry-over increased rapidly. This did not continue. The low pack of 1947, and the small pack of 1948 have been followed by low carry-overs. The peculiarities of the 1948 pack are reflected in the nearly current carry-over figures. The Canners League of California reported that as of January 1, 1949, the pack unsold and on hand was 29,610 actual cases compared to 282,972 cases on the same date in 1948. By March 1, 1949, when some 1948 packing had occurred, canners' stocks were some 40,172 cases compared with 266,284 cases a year before. MARKETING FRESH SPINACH California fresh spinach mostly marketed within State Cellophane packaging opens way to better consumer demand and merchandising Fresh spinach may be shipped either to distant or local markets. In the past, spinach was packed in crates or baskets. It was packed bunched or loose. For distant markets, fresh spinach is shipped in paper-lined lettuce crates. It is usually loose and unwashed. Crushed ice is added, and it is shipped under refrigeration in carload lots. In California, most fresh spinach reaches local markets by truck. Fresh spinach for the local market is harvested and delivered the next day. The yellow, dead or diseased leaves are re- moved and the spinach is watered to keep it fresh and turgid. It reaches the retailer as soon as possible. Cellophane Bags Pre-packaging of fresh spinach has in- creased in the last few years. The spinach is thoroughly cleaned, sorted and pack- aged in cellophane consumer-size bags. The consumer gets a clean product which needs a minimum of preparation before cooking. Spinach is particularly suited to pre- packaging. It is the most important pack- aged vegetable crop. In California, about half of the fresh spinach sales in the Los Angeles and San Francisco areas are made in branded consumer-size packages. Packaging has been confined to the local market, but it is probable that it will be used for distant markets. Pre-packaging makes branding and ad- vertising possible. This has an important influence on marketing methods. Packag- ing makes the product more attractive and in better demand. It should be noted that if the consumer- package develops on a large scale, the purchases and sales of packers may be large enough to affect selling prices in the field. [16] CONSUMPTION Actual data unavailable but other trends show U. S. fresh consumption decreasing Canned and frozen increasing Actual consumption data are not avail- able, but certain trends are evident from utilization and shipment data. Before the war, both canned and frozen spinach were increasing in importance. It seemed that processed spinach was replac- ing consumer demand for fresh spinach. The situation during and since the end of the war is confused because much of the canned shipments did not go directly to the consumer. They were used to re- build war-depleted stocks of distributor and retail outlets. However, in spite of the low canned and frozen packs of 1947 and 1948, the indicated consumption of processed spinach is still high compared to pre-war years. In contrast, indicated fresh spinach consumption is below the average for 1935-1939. CALIFORNIA FARM PRICES Rose rapidly during war, reaching peak in 1 944 Post-war prices continue on high level Less production and greater demand keeps prices up California farm spinach prices from 1919 through 1948 may be divided into several periods. Prices followed a downward trend until 1926 when they flattened out for several years. They rose during 1930-1932. From 1933 through 1942, prices generally fol- lowed a gradual upward trend. A marked rise occurred in 1943. Since 1943, annual prices have fluctuated around a record level (fig. 10). When the downward price trend up to 1926 developed, there also developed an upward production trend over the same period. Prices remained stable during the latter half of the 1920's despite the marked increase in production. The price behav- ior reflects the strong increase in demand during those years. In the depression years of the early 1930's, prices held up chiefly due to mark- edly reduced production. As the U. S. recovered from the depres- sion, California farm prices advanced. This was due to economic recovery throughout the U. S. and production de- clining again rather than returning to previous high levels. [17] FIGURE 10 California Spinach Production and Average Farm Price, 1919—1948 (thousands of tons, and dollars per ton) 120 120 1920 1925 1930 1935 1940 1945 During the national defense and war years, spinach farm prices rose along with other prices. Increased demand, especially for processed spinach, played a strong part in the price picture. Although processed output increased during the war, total production (proc- essed and fresh combined) was stable and remained below previous record levels. High farm prices during 1947 and 1948 reflected low production compared to other years. California spinach farm prices in recent years have not only been higher than before the war, but they also have not suffered post-war declines as in some other farm prices. Reduced production coupled with ex- panded demand accounts for high post- war prices. 6|m-9/49(P>514G) [18 /1U AGRICULTURE • . • Contains brief, easy-to-read progress reports of agricultural research, and is published monthly by the University of California College of Agricul- ture, Agricultural Experiment Station. FIELD CROPS ORCHARDS TRUCK CROPS LIVESTOCK CALIFORNIA AGRICULTURE offers information useful to the farmer and food processor, together with announce- ments of other publications dealing with farm subjects as they are issued by the College of Agriculture. 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