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Competition in agriculture : a case study of a marketing board Fredericks, Leo Jocelyn 1965

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' COMPETITION IN AGRICULTURE; A CASE STUDY OF A MARKETING BOARD by LEO JOCELYN FREDERICKS B.A. (Hons.), U n i v e r s i t y o f Malaya, 1963 A t h e s i s submitted i n p a r t i a l f u l f i l m e n t o f the requirements f o r the degree of MASTER OF SCIENCE IN AGRICULTURE i n the Department o f AGRICULTURAL ECONOMICS We accept t h i s t h e s i s as conforming t o the r e q u i r e d standard THE UNIVERSITY OF BRITISH COLUMBIA A p r i l , 1965 I n p r e s e n t i n g t h i s t h e s i s i n p a r t i a l f u l f i l m e n t o f t h e r e q u i r e m e n t s f o r an a d v a n c e d d e g r e e a t t h e U n i v e r s i t y o f • B r i t i s h C o l u m b i a , I a g r e e t h a t t h e L i b r a r y s h a l l make i t f r e e l y a v a i l a b l e f o r r e f e r e n c e and study., I f u r t h e r a g r e e t h a t p e r -m i s s i o n f o r e x t e n s i v e c o p y i n g o f t h i s t h e s i s f o r s c h o l a r l y p u r p o s e s may be g r a n t e d b y t h e Head o f my D e p a r t m e n t o r by h i s r e p r e s e n t a t i v e s . I t i s u n d e r s t o o d t h a t , c o p y i n g o r p u b l i -c a t i o n o f t h i s t h e s i s f o r f i n a n c i a l g a i n s h a l l n o t be a l l o w e d w i t h o u t my w r i t t e n p e r m i s s i o n * D e p a r t m e n t o f A g r i c u l t u r a l Economics The U n i v e r s i t y o f B r i t i s h C o l u m b i a , V a n c o u v e r 8, C a n a d a D a t e 23rd A p r i l . 1965.  ABSTRACT T h i s study had two purposes s t o analyze and assess the use of the l e g a l powers vested i n the B r i t i s h Columbia F r u i t Board and i t s marketing agency, B.C. Tree F r u i t s , L t d . , and s e c o n d l y , to evaluate the impact of the f o r m a t i o n of the marketing scheme upon supply, market s t r u c t u r e and market procedure i n the f r u i t i n d u s t r y . Against the background of the t h e o r i e s of c o m p e t i t i o n , an a n a l y s i s of marketing was made f o r a p p l e s , c r a b - a p p l e s , pears, peaches, plums, prunes, c h e r r i e s and a p r i c o t s f o r the I 9 6 3 crop season. Data f o r the study were obtained from the records of the B.C. F r u i t Board and B.C. Tree F r u i t s L t d . , the Dominion Bureau of S t a t i s t i c s and the Canada Department o f A g r i c u l t u r e . For the a n a l y s i s , the f o l l o w i n g components of the scheme were examined: the i n t e g r a t e d s t r u c t u r e of marketing, the methods of d i s t r i b u t i n g s a l e s r e t u r n s and the p o l i c i n g powers of the F r u i t Board; the use of supply r e g u l a t i o n i n regard t o time, place and form; p r i c i n g p o l i c y and p r i c e d i f f e r e n t i a t i o n procedures. The s t r u c t u r e of the marketing scheme was found t o be both a v e r t i c a l and h o r i z o n t a l i n t e g r a t i o n of growers, packers and s h i p p e r s , canners and p r o c e s s o r s and the marketing agency. The p o o l i n g d i s t r i b u t i o n of revenues c o n s t i t u t e s an important aspect of the r e l a t i o n s h i p between growers and the F r u i t Board. Of the three methods c u r r e n t l y used, the t r e n d l i n e p o o l i n g method seems t o o f f e r the best p o s s i b i l i t i e s f o r an e q u i t a b l e d i s t r i b u t i o n . The p o l i c i n g of the r e g u l a t e d area i s w i t h i n the j u r i s d i c t i o n of the F r u i t Board. P o l i c i n g i s done t o ensure t h a t there are no i l l e g a l movements of r e g u l a t e d f r u i t w i t h i n the r e g i o n or outside i t and t h a t r u l e s p e r t a i n i n g t o f r u i t - s t a n d s a l e s are complied w i t h . The marketing agency has a p p l i e d supply c o n t r o l l i n g procedures through expanding i t s markets s p a t i a l l y , through the use of storage f a c i l i t i e s t o r e g u l a t e i t s shipments t o a l l o u t l e t s and through the d i v e r s i o n of f r u i t i n excess of normal f r e s h f r u i t consumption to the processed and canned f r u i t markets. The o b j e c t i v e of the agency's p r i c i n g p o l i c y i s the l o n g - r u n maximization of r e t u r n s t o growers. The m u l t i -p l i c i t y of v a r i a b l e s which have t o be considered before a p r i c e can be quoted makes i t impossible t o s t a t e that there i s a d e f i n i t e p r i c e p o l i c y f o l l o w e d by the agency. P r i c e d i f f e r e n t i a t i o n i s a p p l i e d whenever p o s s i b l e by the agency to maximize revenues. I n extreme cases where t r a d i t i o n a l markets are s a t u r a t e d , excess f r u i t i s "dumped" i n other markets. The c o n c l u s i o n of t h i s study i s that the B.C. F r u i t Board and B.C. Tree F r u i t s L t d . have developed an extensive use of t h e i r powers t o ensure s t a b l e r e t u r n s f o r the f r u i t growers of the Okanagan. The e x i s t e n c e of three main reasons prevent the B.C. F r u i t Scheme from e x e r c i s i n g g r e a t e r monopoly powers. They are c o m p e t i t i o n from other f r u i t growing areas, the absence of p r o d u c t i o n c o n t r o l s on the farm l e v e l and the absence of t a r i f f r e g u l a t o r y powers. ACKNOWLEDGEMENT The w r i t e r wishes t o acknowledge the many h e l p f u l comments and c r i t i c i s m s o f f e r e d by the members of h i s t h e s i s committee. S p e c i a l thanks are due to Dr. J . J . R i c h t e r , Dr. M.J. D o r l i n g , Mr. M. Moore and Dr. G. Eaton. A debt of g r a t i t u d e i s owed to the s t a f f of B.C. Tree F r u i t s L t d . , Kelowna, and e s p e c i a l l y t o Mr. D.J. S u t h e r l a n d , the A s s i s t a n t t o the General Manager, f o r p r o v i d i n g e s s e n t i a l d a t a f o r t h i s t h e s i s . Mr. P.C. McCallum, S e c r e t a r y of the B . C . F r u i t Board, and Mr. L.R. S-tephens of the Okanagan Federated Shippers a l s o helped g r e a t l y i n t h i s r e g a r d . F i n a l l y , the w r i t e r wishes t o express deep a p p r e c i a t i o n to the Government of Canada f o r the o p p o r t u n i t y of studying i n Canada. TABLE OF CONTENTS. Chapter Page I INTRODUCTION 1 Purpose of the Study 1 Methodology of the Study 1 Scope of the Study 3 D e f i n i t i o n s 4 I I MICR';0-ECONOMIC ANALYSIS OF THE FARM-FIRM: DEMAND AND SUPPLY RELATIONS 7 Demand Functions . . . . . 7 Supply Schedules 9 Aggregate Supply Responses 15 I n d i v i d u a l Commodity Responses 19 Resource Response i n the Okanagan F r u i t I n d u s t r y 1 9 I I I DEVELOPMENT OF AGRICULTURAL MARKETING BOARDS. . . . 28 F a c t o r s C o n t r i b u t i n g to the Development of Marketing Boards 28 Types of Marketing Boards 33 B.C. Tree F r u i t Scheme 34 IV ANALYSIS OF THE POWERS; OF THE BRITISH COLUMBIA FRUIT BOARD 37 S t r u c t u r e of the B . C . F r u i t Board 37 Methods of D i s t r i b u t i n g Returns 41 v i Chapter Page Types of Pools 42 Cherry P o o l s . . . . . . . . . . . . . . 43 Apple Pools ; . 44 Summary 53 P o l i c i n g of the Regulated Area 54 V ANALYSIS OF THE PROCEDURES APPLIED BY B.C. TREE FRUITS LTD. TO MAXIMIZE REVENUES. 58 Supply R e g u l a t i o n . 58 Season a l D i s t r i b u t i o n of F r u i t 58 Supply R e g u l a t i o n Through the Time F a c t o r . . 69 Supply R e g u l a t i o n Through the Form F a c t o r 72 Supply R e g u l a t i o n Through the Space Fa c t o r 75 P r o d u c t i o n C o n t r o l . 77 P r i c i n g and P r i c e D i f f e r e n t i a t i o n . . . . . 79 P r i c i n g P o l i c y 79 D i f f e r e n t i a t e d P r i c i n g 81 R e g i o n a l Demand A n a l y s i s f o r Apples . . 90 V a r i a t i o n s i n P r i c e s . 97 Summary 100 VI SUMMARY AND CONCLUSIONS 101 v i i LIST OF TABLES Table .. , Page I Estimated Values of the C o e f f i c i e n t of 'the P r i c e E l a s t i c i t y of Demand f o r Food at the R e t a i l L e v e l , U.S. and Canada. . . 11 I I E s timated Values of the C o e f f i c i e n t of the Income E l a s t i c i t y of Demand f o r Food at the R e t a i l L e v e l , U.S.A. and Canada 12 I I I Estimated Values of the C o e f f i c i e n t of the P r i c e E l a s t i c i t y of Demand f o r S e l e c t e d Food Products at F a r m - R e t a i l L e v e l , U n i t e d S t a t e s and Canada. 13 IV Estimated Values of the C o e f f i c i e n t of the Income E l a s t i c i t y of Demand f o r S e l e c t e d Food Pr o d u c t s , United S t a t e s and Canada 14 V Index of T o t a l Farm Value, Regulated F r u i t s , Okanagan V a l l e y , 1947- 1962. . 29 VI Summary of Poo l s f o r A l l Regulated F r u i t , 1963 Crop 45 V I I P o o l Returns f o r C h e r r i e s , I963 Crop 46 V I I I P o o l Returns f o r A l l A p p l e s , 1963 Crop. . . . . 49 IX Length of Marketing and H a r v e s t i n g S,easons, A l l Regulated F r u i t , 1963 Crop 70 X C o e f f i c i e n t s o f V a r i a t i o n s and A c t u a l Average Shipments of a l l Regulated F r u i t , 1963 Crop , , 71 v i i i T able Page XI Average Net Returns per U n i t Volume f o r S e l e c t e d Grades and V a r i e t i e s o f F r u i t , 1963 Crop Season #6 XII Comparison o f Average Naked F r e s h F r u i t Returns A l l Markets, Group. No. 1 C h e r r i e s , 1964 87 X I I I Type o f Demand F u n c t i o n , C o e f f i c i e n t s o f M u l t i p l e D e t e r m i n a t i o n and Regression C o e f f i c i e n t s f o r D i f f e r e n t R e g i o n a l Markets and Supply Areas, A l l Apples 94 XIV C o e f f i c i e n t s o f V a r i a t i o n ( e . v . ) , F r e s h F r u i t Average P r i c e s and the P r o p o r t i o n {%) o f Reg i o n a l S a l e s R e l a t i v e t o Aggregate S a l e s t o A l l Markets, 1963 Crop 99 XV Cumulative Percent of Output C o n t r o l l e d by Numbers o f Firms, Canada, 1948 and 1956 117 XVI E x t e n t of C o n c e n t r a t i o n of C o n t r o l o f the Assembly, P r o c e s s i n g and Wholesale D i s t r i b u t i o n o f the P r i n c i p a l C l a s s e s o f Farm Products and T h e i r Primary D e r i v a t i v e s , U n i t e d S t a t e s , 1934 . 120 XVII P o o l Returns f o r Prunes, 1963 Crop 121 XVIII P o o l Returns f o r Plums, 1963 Crop 122 XIX P o o l Returns f o r A p r i c o t s , 1963 Crop 123 XX P o o l Returns f o r Crab-Apples, 1963 Crop 124 XXI P o o l Returns f o r Pears, 1963 Crop 1 2 5 2XII P o o l Returns f o r Peaches, 1963 Crop 127 i x T a b l e Page XXIII P o o l Returns f o r Cookers, 1963 Crop 130 XXIV S p a t i a l D i s t r i b u t i o n o f Regulated F r u i t by Weight, 1963 Crop 132 XXV Apples, S u p p l i e s and D i s t r i b u t i o n , Canada, 1954 - 1963 146 XXVa Esti m a t e s o f Per C a p i t a Disappearance, F r e s h Apples, Western Canada, 1954 - 1963 147 XXVI E s t i m a t e s o f Per C a p i t a Disappearance, F r e s h Apples, E a s t e r n Canada, 1954 - 1963 148 XXVII Wholesale P r i c e s o f (P 2) Apples, Per C a p i t a D i s -posable income ( X 3 ) and Net Per C a p i t a D i s p o s a b l e Income ( X ' ^ ) , Western Canada and E a s t e r n Canada, 1954 - 1963 149 XXVIII Per C a p i t a Consumption o f B.C. Tree F r u i t s L t d . S a l e s o f F r e s h Apples (X^), Wholesale P r i c e s o f Apples ( P 2 ) per C a p i t a D i s p o s a b l e Income ( X 3 ) and Net Per C a p i t a D i s p o s a b l e Income ( X f 3 ) ; Vancouver 1954 - 1963 150 XXIX Per C a p i t a Consumption o f B.C. Tree F r u i t s L t d . S a l e s o f F r e s h Apples (X^), Wholesale P r i c e s o f Apples ( P 2 ) per C a p i t a D i s p o s a b l e Income ( X 3 ) Toronto, 1954 - 1963 151 XXX A p p l i c a t i o n and C a n c e l l a t i o n o f Seasonal S p e c i f i c T a r i f f Regulated F r u i t , 1963/1964 Season 183 X LIST OF ILLUSTRATIONS Number Page Graph 1 Average v a l u e o f a p r i c o t s marketed compared w i t h number of a p r i c o t t r e e s ( a l l ages), Okanagan V a l l e y , 1945 - 1955 21 Graph 2 Average v a l u e o f c h e r r i e s marketed compg?ed w i t h number of c h e r r y t r e e s ( a l l a g e s ) , Okanagan V a l l e y , 1945 - 1955 Graph 3 Average v a l u e o f pears marketed compared w i t h number of pear t r e e s ( a l l a g e s ) , Okanagan V a l l e y , 1945 - 1955. . . . 23 Graph 4 Average v a l u e o f a p p l e s and c r a b - a p p l e s marketed compared w i t h number of apple and c r a b - a p p l e t r e e s ( a l l a g e s ) , Okanagan V a l l e y , 1945-1955. . 24 Graph 5 - Average v a l u e o f plums and prunes marketed compared w i t h number o f plum and prune t r e e s ( a l l a g e s ) , Okanagan V a l l e y , 1945 - 1955 25 Graph 6 Average v a l u e o f peaches marketed compared w i t h number of peach t r e e s ( a l l a g e s ) , Okanagan V a l l e y , 1945 - 1955 26 F i g . 1 O r g a n i z a t i o n C h a r t o f the B.C. F r u i t M a r k e t i n g Scheme . . . . . . . . . 40 Map 1 ikrea under j u r i s d i c t i o n o f the B . C . F r u i t B oard. 56 Graph 7 B.C.Tree F r u i t L t d . shipments t o a l l markets and h a r v e s t i n g p e r i o d , a l l c h e r r i e s , 1963 c r o p . 59 x i Number Page Graph 8 B.C.Tree F r u i t shipments t o a l l markets, p e r i o d of h a r v e s t i n g and p e r i o d of a p p l i c a t i o n of s e a s o n a l s p e c i f i c t a r i f f , a l l a p r i c o t s , 1963 crop 60 Graph 9 B.C.Tree F r u i t s L t d . shipments t o a l l markets, p e r i o d of h a r v e s t i n g and p e r i o d of a p p l i c a t i o n of s e a s o n a l s p e c i f i c t a r i f f , a l l prunes, 1963 crop 62 Graph 10 B.C. Tree F r u i t s L t d . shipments t o a l l markets, p e r i o d of h a r v e s t i n g and p e r i o d of a p p l i c a t i o n o f s e asonal s p e c i f i c t a r i f f , a l l peaches, 1963 crop. 63 Graph 11 B.C.Tree F r u i t s L t d . shipments to a l l markets, a l l plums, I963 crop 64 Graph 12 B.C.Tree F r u i t s L t d . shipments t o a l l markets, a l l c r ab-apples, 1963 crop 65. Graph 13 B.C.Tree F r u i t s L t d . shipments t o a l l markets, p e r i o d of h a r v e s t i n g and p e r i o d of a p p l i c a t i o n of s e a s o n a l s p e c i f i c t a r i f f , a l l pears, 1963 crop 66 Graph 14 B.C.Tree F r u i t s L t d . shipments to a l l markets, p e r i o d of h a r v e s t i n g and p e r i o d of a p p l i c a t i o n of s e a s o n a l s p e c i f i c t a r i f f , a l l apples.1963 crop. 67 F i g . 2 Q u a n t i t i e s of winesaps i n storage, s h i p p i n g and packing houses, Okanagan V a l l e y , compared t o B.C. Tree F r u i t L t d . s a l e s , March t o May, 1964 73 x i i Number Page F i g . 3 Q u a n t i t y of red d e l i c i o u s i n storage, s h i p p i n g and packing houses, Okanagan V a l l e y , compared w i t h B.C. Tree F r u i t L t d . s a l e s , March t o May 1964 .... 74 Graph 15 B.C. Tree F r u i t s L t d . r e g i o n a l shipments and f . o . b . p r i c e s o f a l l f r e s h prunes, 1963 crop, B r i t i s h Columbia 152 Graph 16 B.C. Tree F r u i t s L t d . shipments and d e l i v e r e d p r i c e s , a l l f r e s h prunes, 1963 crop, Western Canada 153 Graph 17 B.$. Tree F r u i t s L t d . r e g i o n a l shipments and d e l i v e r e d p r i c e s , a l l f r e s h prunes, 1963 crop, E a s t e r n Canada 154 Graph IB B.C. Tree F r u i t s L t d . r e g i o n a l shipments and f.o.b. p r i c e s , a l l f r e s h c h e r r i e s , 1963 crop, B r i t i s h Columbia 155 Graph 19 B.C. Tree F r u i t s L t d . r e g i o n a l shipments and d e l i v e r e d p r i c e s , a l l f r e s h c h e r r i e s , 1963 crop, Western Canada 156 Graph 20 B.C. Tree F r u i t s L t d . r e g i o n a l shipments and f.o.b. p r i c e s , a l l f r e s h a p r i c o t s , 1963 crop B r i t i s h Columbia 157 Graph 21 B.C. Tree F r u i t s L t d . r e g i o n a l shipments and d e l i v e r e d p r i c e s , a l l f r e s h a p r i c o t s , 1963 cr o p , Western Canada 159 x i i i Number Page Graph 22 B.C. Tree F r u i t s L t d . r e g i o n a l shipments and f . o . b . p r i c e s , a l l f r e s h plums, 1963 crop, B r i t i s h Columbia 160 Graph 23 B.C. Tree F r u i t s L t d . r e g i o n a l shipments and d e l i v e r e d p r i c e s , a l l f r e s h plums, 1963 crop, Western Canada 161 Graph 24 B.C. Tree F r u i t s L t d . r e g i o n a l shipments and f.o.b. p r i c e s , a l l f r e s h peaches, 1963 crop, B r i t i s h Columbia 162 Graph 25 B.C. Tree F r u i t s L t d . r e g i o n a l shipments and d e l i v e r e d p r i c e s , a l l f r e s h peaches, 1963 crop, Western Canada 163 Graph 26 B.C. Tree F r u i t s L t d . r e g i o n a l shipments and f.o.b. p r i c e s , a l l f r e s h c r a b - a p p l e s , 1963 crop, B r i t i s h Columbia 164 Graph 27 B.C. Tree F r u i t s L t d . r e g i o n a l shipments and d e l i v e r e d p r i c e s , a l l f r e s h c r a b - a p p l e s , 1963 crop, Western Canada 165 Graph 28 B.C. Tree F r u i t s L t d . r e g i o n a l shipments and d e l i v e r e d p r i c e s , a l l f r e s h c r a b - a p p l e s , 1963 c r o p , E a s t e r n Canada 166 Graph 29 B.C. Tree F r u i t s L t d . r e g i o n a l shipments and f . o . b . p r i c e s , a l l f r e s h pears, 1963 crop, B r i t i s h Columbia 167 x i v Number Page Graph 3 0 B.C. Tree F r u i t s L t d . r e g i o n a l shipments and d e l i v e r e d p r i c e s , a l l f r e s h pears, 1963 crop, Western Canada 168 Graph 31 B.C. Tree F r u i t s L t d . r e g i o n a l shipments and d e l i v e r e d p r i c e s , a l l f r e s h pears, 1963 crop, E a s t e r n Canada 169 Graph 3 2 B.C. Tree F r u i t s Ltd.. r e g i o n a l shipments and f.o.b. p r i c e s , a l l f r e s h a p p l e s , 1963 crop B r i t i s h Columbia 170 Graph 33 B.C. Tree F r u i t s L t d . r e g i o n a l shipments and d e l i v e r e d p r i c e s , a l l f r e s h a p p l e s , 1963 crop, Western Canada 171 Graph 3k B.C. Tree F r u i t s L t d . r e g i o n a l shipments and d e l i v e r e d p r i c e s , a l l f r e s h a p p l e s , 1963 crop, E a s t e r n Canada 172 CHAPTER I INTRODUCTION A g r i c u l t u r a l p r o d u c t i o n i s s u c h t h a t c o n d i t i o n s among s e l l e r s approach t h a t o f pure c o m p e t i t i o n . The o r g a n i z a t i o n of l a r g e - s c a l e c o o p e r a t i v e s and p r o d u c t i o n c o n t r o l programs i s a common method o f a t t e m p t i n g t o escape t h e s e c o n d i t i o n s . 1 Purpose o f t h e S t u d y T h i s o b s e r v a t i o n by N i c h o l l s p r o v i d e d the m o t i v a t i o n f o r s t u d y i n g t h e u t i l i z a t i o n of a m a r k e t i n g board's powers. I t i s u n i v e r s a l l y a p p r e c i a t e d t h a t the a t o m i s t i c n a t u r e o f p r o d u c t i o n i n a g r i c u l t u r e l e a d s t o pure c o m p e t i t i o n i n b o t h a g r i c u l t u r a l p r o d u c t and f a c t o r markets ( f r o m the fa r m e r ' s v i e w p o i n t ) . However, as farmers r e a l i z e the e f f e c t i v e n e s s of c o n s o l i d a t i o n and t a k e advantage o f t h a t measure i m p e r f e c t i o n s a r e i n t r o d u c e d . The p r i m a r y purposes o f t h i s s t u d y are? a. t o a n a l y s e and a s s e s s the e x t e n t o f the use of powers v e s t e d i n the B . C . F r u i t Board *, b. t o e v a l u a t e the impact o f the f o r m a t i o n of a m a r k e t i n g board upon pure c o m p e t i t i o n i n p r o d u c t i o n and m a r k e t i n g . Methodology of the S t u d y The h y p o t h e s i s upon w h i c h t h i s s t u d y r e s t s can be nftf.H. N i c h o l l s , I m p e r f e c t C o m p e t i t i o n W i t h i n A g r i c u l t u r a l  I n d u s t r i e s . Ames, The Iowa S t a t e C o l l e g e P r e s s , 194-7, p.12. 2 s t a t e d as f o l l o w s : i . I t i s r e c o g n i z e d t h a t pure c o m p e t i t i o n e x i s t s i n p r o d u c t i o n i n a g r i c u l t u r e . i i . The e x i s t e n c e of c e r t a i n f a c t o r s d e t r a c t s from the f u l l p l a y of the c o n d i t i o n s of pure c o m p e t i t i o n w i t h i n t h e s s e c t o r . B r i e f l y these f a c t o r s can be c l a s s i f i e d as c o o p e r a t i v e i n s t i t u t i o n s , marketing boards and other aspects of government p o l i c y and v e r t i c a l i n t e g r a t i o n i n the production-marketing s e c t o r . The f a c t o r r e l a t i n g t o marketing boards was s e l e c t e d f o r study. The prime reason f o r t h i s choice was the o p p o r t u n i t y of s e l e c t i n g from marketing boards i n Canada, one i n s t i t u t i o n which i s unanimously acclaimed as u t i l i z i n g i t s powers t o a maximum. Hence i t was p o s s i b l e to use the case-study method f o r a n a l y s i n g the o p e r a t i o n s of the B.C. F r u i t Board and i t s marketing agency, B.C. Tree F r u i t s L t d . P r o d u c t i o n , p r i c i n g , p o l i c i n g and' supply f i g u r e s p e r t a i n i n g t o the 1963 crop i n the r e g u l a t e d area were used. S i n c e t a r i f f c o n t r o l i s o u t s i d e the j u r i s d i c t i o n of the marketing scheme, i t i s i n c l u d e d i n the Appendix. Two c a t e g o r i e s of f r u i t are r e c o g n i z e d : f i r s t l y , the s o f t f r u i t group i n c l u d i n g plums, peaches, prunes, a p r i c o t s , and c h e r r i e s and secondly, the " t r e e - f r u i t " group c o n s i s t i n g of apples, crab-apples and pears. Although the marketing agency s e l l s non-regulated f r u i t l i k e grapes f o r i n s t a n c e , none of these are covered i n t h i s study. Apart from e x t e n s i v e use o f primary data e x t r a c t e d from the f i l e s of B.C. F r u i t Board and B.C. Tree F r u i t s L t d . , i n f o r m a l i n t e r v i e w s w i t h o f f i c i a l s o f the agency were a l s o conducted. Data f o r t h e regionalcfemand a n a l y s i s of apples were obtained from the Dominion Bureau of S t a t i s t i c s and the Canada Department of A g r i c u l t u r e . For the f i r s t two chapters on the t h e o r e t i c a l background t o the study, r e f e r e n c e was made t o the t e x t s on micro-economic f a r m - f i r m theory and marketing board t h e o r y . The N a t u r a l Products Marketing ( B r i t i s h Columbia) Act 1948, the B r i t i s h Columbia Tree F r u i t Marketing Scheme I 9 6 0 , the A g r i c u l t u r a l Products Marketing Act (Canada) 1949 and the A g r i c u l t u r a l Products Marketing A c t , B.C. Tree F r u i t Export R e g u l a t i o n s 1 9 6 3 were a l s o s c r u t i n i z e d . Scope of the Study. Before a n a l y s i n g the a p p l i c a t i o n of the powers vested i n the B.C. F r u i t Board and the procedures a p p l i e d by B.C. Tree F r u i t s L t d . and t h e i r impact upon market s t r u c t u r e i t was f i r s t necessary t o o u t l i n e the f a c t o r s l e a d i n g t o the development of marketing boards. Chapter I I on the micro-economic theory of the primary u n i t of p r o d u c t i o n i n a g r i c u l t u r e , l a y s the groundwork f o r the theory of marketing boards i n Chapter I I I . A review of the race between demand and supply i n a g r i c u l t u r e p r o v i d e s the l o g i c a l stepping-stone t o a d i s c u s s i o n of the i n s t i t u t i o n of marketing boards. 4 Chapter I I I analyses the main f a c t o r s l e a d i n g t o the establishment of marketing boards. I t a l s o c a t e g o r i z e s the e x i s t i n g marketing boards i n Canada as w e l l as examines the t h e o r e t i c a l extent of the l e g i s l a t i o n c r e a t i n g marketing boards i n g e n e r a l and the B.C. F r u i t Marketing Scheme i n p a r t i c u l a r . The focus of the t h e s i s i s i n Chapter IV and Chapter V. Chapter IV analyses the powers vested i n the B.C. F r u i t Board. S p e c i f i c a l l y , i t i n v e s t i g a t e s the s t r u c t u r e of the B.C. F r u i t Board from the p e r s p e c t i v e o f the process of v e r t i c a l and h o r i z o n t a l i n t e g r a t i o n , and the nature of i t s r e l a t i o n s h i p w i t h B.C. Tree F r u i t s L t d . , the packers and sh i p p e r s of f r u i t , the p r o c e s s o r s , canners and growers. I t s p o l i c i n g powers are a l s o examined. Chapter V analyses the procedure a p p l i e d by the marketing agency t o maximize grower r e t u r n s . It looks i n t o the methods by which B.C. Tree F r u i t s L t d . c o n t r o l s p r o d u c t i o n , r e g u l a t e s s u p p l i e s t o the market and p r i c e s r e g u l a t e d f r u i t . A r e g i o n a l demand a n a l y s i s f o r apples i s attempted to i n v e s t i g a t e the economic r a t i o n a l e f o r the agency's d i f f e r -e n t i a t e d p r i c i n g procedure. The f i n a l chapter summarises the f i n d i n g s i n Chapters IV and V and appraises them i n the l i g h t of the t w o - f o l d purpose of t h i s study. D e f i n i t i o n s In order t o assess the impact of the f r u i t marketing 5 scheme on market s t r u c t u r e , i t i s necessary to d e f i n e pure c o m p e t i t i o n i n the marke t . "Pure c o m p e t i t i o n r e f e r s to the s e l l e r s ' market i n which no p a r t i c u l a r s e l l e r has any degree of c o n t r o l over the aipply of a homogeneous good a v a i l a b l e t o many b u y e r s " . 2 M o n o p o l i s t i c or i m p e r f e c t c o m p e t i t i o n i n the market i s d e f i n e d by a s e r i e s o f r e l a t e d p r o p o s i t i o n s stemming from the nature of the r a t i o n a l conduct of a l i m i t e d number of competing producers s e l l i n g i n the same market . The b a s i c p r o -p o s i t i o n i s t h a t when the number of producers i s s m a l l enough so t h a t the a c t i o n of any one o f them w i l l n o t i c e a b l y a f f e c t the market f o r the products of each of the o t h e r s , they w i l l not act as pure compet-i t o r s . ' A d i g r e s s i o n on the theory of p r i c e d i f f e r e n t i a t i o n i s warranted s i n c e t h i s i s an important p a r t o f the t h e o r y o f imper fec t or m o n o p o l i s t i c c o m p e t i t i o n and s i n c e i t i s a major procedure f o l l o w e d by B . C . Tree F r u i t s L t d . i n order t o maximize grower r e t u r n s . P r i c e d i f f e r e n t i a t i o n i s a t a n g i b l e form of mono-p o l i s t i c c o m p e t i t i o n . The technique of d i f f e r e n t i a t e d p r i c i n g i s geared towards the p r o f i t m a x i m i z a t i o n o b j e c t i v e o f the entrepreneur and i n v o l v e s the s a l e of a homogeneous product at d i f f e r e n t i a t e d p r i c e s i n s p a t i a l l y separated . H . C h a m b e r l a i n , The Theory of M o n o p o l i s t i c C o m p e t i t i o n . Cambridge, Harvard U n i v e r s i t y P r e s s , 1942, p . 7 . 3T .C. Cochran , " H i s t o r i c a l Aspects of Imperfect C o m p e t i t i o n , Theory and H i s t o r y , " J o u r n a l of Economic H i s t o r y , v o l . I l l , (December, 1943) , p . 28 . 6 markets. T h i s process i n v o l v e s the segmentation of a market i n t o s e v e r a l sub-markets, each c h a r a c t e r i s e d by a demand curve and e l e s t i c i t y p r o p e r t i e s d i f f e r e n t from the next. One s i g n i f i c a n t f a c t o r conducive t o the p r a c t i c e o f d i f f e r e n t i a t e d p r i c i n g i s the s p a t i a l s e p a r a t i o n o f markets r e i n f o r c e d by i n e r t i a , ignorance and im m o b i l i t y of the consuming u n i t s w i t h i n them. An e x t e n s i o n of t h i s case i s the i n s t i t u t i o n a l b a r r i e r s r a i s e d by p r o t e c t i v e t a r i f f s . A s e l l e r can t h e n d i s c r i m i n a t e a g a i n s t the home market by charging h i g h e r p r i c e s i n the export market. As L e o n t i e f f has observed, the powers of p r i c e d i f f e r e n t i a t i o n are l i m i t e d between c e r t a i n boundaries. In "dumping" the d i f f e r e n c e between l o c a l and export commodity p r i c e s cannot exceed the t a r i f f duty, w h i l e i n i n t e r r e g i o n a l p r i c e d i f f e r e n t i a t i o n , the p r i c e d i f f e r e n t i a l between two sub-markets cannot be g r e a t e r than the t r a n s p o r t a t i o n cost 4 between them. The economic r a t i o n a l e u n d e r l y i n g the p r a c t i c e o f p r i c e d i f f e r e n t i a t i o n i s the maximization of p r o f i t through the e q u a l i z a t i o n of m a r g i n a l revenues obtained i n d i f f e r e n t markets % . L e o n t i e f f , "Theory of L i m i t e d and U n l i m i t e d D i s c r i m i n a -t i o n , " Q u a r t e r l y J o u r n a l of Economics. v o l . L I V , (May 1940) pp. 490-491. ^For a l u c i d account of t h i s see J.R.Bowring, H.M.Southworth and F.V. Waugh, Marketing P o l i c i e s f o r A g r i c u l t u r e . New J e r s e y , P r e n t i c e - H a l l Inc., I960, pp. 114-118. 7 CHAPTER I I MICRO-ECONOMIC ANALYSIS OF THE FARM-FIRM; DEMAND AND SUPPLY RELATIONS Demand F u n c t i o n s A demand f u n c t i o n f o r farm products r e f e r s to the q u a n t i t i e s of farm commodities which would be purchased i n the market at v a r i o u s p r i c e s . A movement along a demand schedule i n d i c a t e s the a s s o c i a t i o n of g r e a t e r or l e s s q u a n t i t i e s s o l d at v a r y i n g p r i c e s . A s h i f t or change i n the demand curve r e f e r s to a temporal movement of the demand curve t o the l e f t or r i g h t because of q u a n t i t a t i v e and q u a l i t a t i v e changes i n p o p u l a t i o n , t a s t e and incomes. The aggregate demand f o r farm products i s r e l a t i v e l y i n e l a s t i c ^ t o changes i n the p r i c e o f the pr o d u c t s . I n the past, the i n t e r a c t i o n of two f a c t o r s , i n c r e a s e s i n the d i s p o s a b l e income of consumers and net a d d i t i o n s t o the p o p u l a t i o n , s h i f t e d the aggregate demand curve t o the r i g h t . I n Canada and the Un i t e d S t a t e s , the more s i g n i f i c a n t v a r i a b l e i s now p o p u l a t i o n growth. T h i s has i m p l i c a t i o n s " I n e l a s t i c i t y i s here d e f i n e d as being between zero and minus one. 8 f o r farmers s i n c e they cannot hope to reap the b e n e f i t s o f the i n c r e a s i n g spending power of consumers. I n other words the income e l a s t i c i t y o f demand f o r food i s low, e s p e c i a l l y t o the consumers i n the h i g h e r income b r a c k e t s . Although as per c a p i t a incomes i n c r e a s e , more w i l l be spent on farm products, food p r i c e s have i n the l o n g - r u n shown a downward tendency because of the i n c r e a s e i n farm output due t o t e c h n o l o g i c a l p r o g r e s s . The food b i l l , hence, c o n s t i t u t e s a s m a l l e r p a r t o f the t o t a l expenditure of consumers and the outcome of t h i s i s t h a t the p r i c e e l a s t i c i t y of demand f o r food i s d e c l i n i n g . For i n d i v i d u a l farm products, both p r i c e and income e l a s t i c i t i e s o f demand vary: of s i g n i f i c a n c e i s the f a c t that " b a s i c " foods have low c o e f f i c i e n t s f o r both r e l a t i o n -s h i p s . With an augmented spending power, consumers s u b s t i t u t e f o r low-value items the more expensive farm p r o d u c t s . There e x i s t s two c o e f f i c i e n t s of the p r i c e e l a s t i c i t y o f demand: one at the r e t a i l l e v e l and the other at the farm l e v e l . The p r i c e of farm products at the r e t a i l l e v e l Includes the cost of marketing and p r o c e s s i n g . I f marketing margins f o r food products are constant, any p r i c e changes at the r e t a i l l e v e l are f u l l y r e f l e c t e d back t o the farmer. Thus the d e r i v e d demand (at the farm l e v e l ) i s l e s s e l a s t i c than at the r e t a i l l e v e l . For the farmer t h i s i m p l i e s t h a t p r i c e movements at the r e t a i l l e v e l w i l l cause g r e a t e r f l u c t u a t i o n s of farmers' incomes. 9 Due to c e r t a i n p a t t e r n s of consumption (e.g., the d e s i r e f o r pre-cooked foods) there i s a trend towards 7 i n c r e a s i n g marketing margins, t h i s has d e l e t e r i o u s e f f e c t s e f f e c t s upon the e l a s t i c i t y of the d e r i v e d demardand t h e farmer's income. The demand schedule f a c i n g the i n d i v i d u a l farmer however, i s p e r f e c t l y e l a s t i c due to h i s i n a b i l i t y t o e x e r t any i n f l u e n c e on the p r i c e of h i s p r o d u ct. T h i s i s due mainly to the s i z e - d i s t r i b u t i o n of farms, and i n accordance w i t h the pure c o m p e t i t i o n model, p r i c e t h e n i s a parameter to t h e f a r m e r s . Some p r i c e and income e l a s t i c i t i e s f o r food and food products are g i v e n i n T a b l e s I t o IV f o r both the United S t a t e s and Canada. I r r e s p e c t i v e of the d i f f e r e n t techniques of c a l c u l a t i o n the f i g u r e s i n d i c a t e : 1. Decreasing p r i c e e l a s t i c i t i e s of demand f o r food and food products i n the U n i t e d S t a t e s and Canada over time. 2. Higher income e l a s t i c i t i e s a s s o c i a t e d w i t h the more expensive food items. 3. A s m a l l e r e l a s t i c i t y o f d e r i v e d demand r e l a t i v e t o the p r i c e e l a s t i c i t y o f demand at the r e t a i l l e v e l . Supply Schedules The supply f u n c t i o n f o r farm products - i n d i v i d u a l l y ?See f o r i n s t a n c e f o r the U.S., G.S. Shepherd,. Marketing  Farm P r o d u c t s . Ames, The Iowa S t a t e C o l l e g e P r e s s , 1958, F i g u r e 4.5> p. 53» and f o r Canada, Royal Commission on P r i c e Spreads of Food Products, Report. I l l , Ottawa, Queen's P r i n t e r , I960. ' examined or i n aggregate - shows v a r i a b i l i t y i n i t s t r e n d , c y c l i c a l or sea s o n a l a s p e c t s . G e n e r a l l y the causes f o r such v a r i a t i o n can be t r a c e d t o : 1. E p i s o d i c or exogeneous v a r i a b l e s i n c l u d i n g the e f f e c t s of war and the weather on supply. 2. T e c h n o l o g i c a l v a r i a b l e s . S c i e n t i f i c and t e c h -n o l o g i c a l advance e s p e c i a l l y i n the l a s t h a l f century has l e d t o r a p i d s h i f t s of the supply curve (n.b. the use of a movement along the supply curve i s d e f i n i -t i o n a l l y s i m i l a r t o t h a t g i v e n f o r demand f u n c t i o n s ) of farm products t o the r i g h t . 3. The p r i c e o f farm p r o d u c t s . I h i l e the c a u s a l e f f e c t t h a t p r i c e has on supply response i s r e c o g n i z e d , the a b i l i t y t o measure i t f o r i n d i v i d u a l farm products and the aggregate supply f u n c t i o n Is v a r i e d . I n t h i s s e c t i o n , the a n a l y s i s w i l l be mostly c o n f i n e d t o the e f f e c t s of p r i c e changes on the supply of a g r i c u l t u r a l p r o d u c t s . TABLE I ESTIMATED VALUES OF THE COEFFICIENT OF THE PRICE ELASTICITY OF DEMAND FOR FOOD AT THE RETAIL LEVEL, U.S. AND CANADA P e r i o d Reference 1913 1922 1929 1950 1941 1941 1942 1955 1958 1963 1 T o b i n - 0 . 2 8 2 G i r s e h i k and Haavelmo - 0 . 2 5 3 Burk - 0 . 2 5 4 Haavelmo - 0 . 2 7 5 Cochrane - 0 . 3 1 6 Bureau of A g r i c u l t u r a l - 0 . 3 3 Economics 7 Fox - 0 . 3 5 -8 - 0 . 3 7 Cochrane 9 Shepherd 10 Canada Department of A g r i c u l t u r e - 0 . 2 3 - 0 . 1 5 -- 0 . 2 0 - 0 . 2 5 - 0 . 1 8 N.B. References 1 - 9 p e r t a i n t o U.S. food Reference 10 p e r t a i n s t o Canada Sources i Ref. 1-7 T.W. S c h u l t z , The Economic O r g a n i z a t i o n of A g r i - c u l t u r e . New York. McGraw-Hill Book Co.Inc., 1953, Table I I - 1 , p. 188. 8 W.W. Cochrane, Farm P r i c e s Myth or R e a l i t y . Minneap-o l i s , U n i v e r s i t y o f Minnesota P r e s s , 1958, pp. 38-39. 9 Shepherd, o p . c i t . p.37. 10 P r i v a t e communication w i t h the Economics Branch, Canada Department of A g r i c u l t u r e , Ottawa, 1964. 12 TABLE II 'ESTIMATED VALUES OF THE COEFFICIENT OF THE INCOME ELASTICITY OF DEMAND FOR FOOD AT THE RETAIL LEVEL, U.S. AND CANADA Period 1913 1922 1929 1929 1909-1941 1941 1940 1941 1948 1948 1958 Reference 1 Tobin 0.27 2 Working 3 Girschik and Haavelmo 4 Mack 5 Stone 6 Bureau of A g r i c u l t u r a l Economics 7 Daly 8 Macfarlane and Black 0.28 0 . 2 5 0.54 0 . 5 3 0.21 0.20-0 . 2 5 0.40 N.B. Only Reference 8 refers to Canada; a l l the rest p e r t a i n to the U.S. Sour cess Ref. 1 - 6 Schultz, op.cit. p. 5 5 • Ref. 7 R»F. Daly,"Long-Range Demand for Farm Products" A g r i c u l t u r a l Economics Research. I l l , ( J u l y 1 9 5 6 ) , p.78. Ref. 8 D.L. Macfarlane and J.D.Black, The Development  of Canadian Agriculture to 1970. Macdonald College, 19581 13 TABLE I I I ESTIMATED VALUES OF THE COEFFICIENT OF THE PRICE ELASTICITY OF DEMAND FOR SELECTED FOOD PRODUCTS AT FARM/RETAIL LEVEL, UNITED STATES AND CANADA Product Red Meats Beef Beef Cattle Pork Lamb Mutton and Lamb Poultry Meats (turkey and chicken) Turkey Eggs Dairy Products (whole milk, butter and chee.se) Fl u i d Whole Milk and Cream Whole Milk Butter Cheese Margarine Lard Shortening Coffee Tea S*ugar White Potatoes Wheat Wheat f l o u r Cereals Barley Oats Corn Wool Vegetables (Farm-level) Mehren 1 1942 -0.80 -0.80 -0.80 -0.55 -0.42 -0.60 -0.15 -0.41 -0.51 -0.55 -0.67 -0.75 (Retail) Beckford^ 1926-62 -0.43 -0.31 -0.66 -1.06 -0.78 -0.31 -0.01 -0.47 -0.15 -0.71 -0.24 -0.94 -0.56 -0.27 -0.25 -0.27 -0.21 -0.24 -0.56 -0.46 N.B. Mehren's c o e f f i c i e n t s are for the United States; Beckford's f o r Canada. Sources; l&chultz, o p . c i t . . p.190. 2M.L.Beckford, Demand Analysis f o r Selected A g r i c u l t - u r a l Commodities. Canada. 1926 - 1962. Unpublished Ph.D. d i s s e r t a t i o n , Faculty of Graduate Studies and Research, University of Manitoba, 1964, Table XX. 14 TABLE IV ESTIMATED VALUES OF THE COEFFICIENT OF THE INCOME ELASTICITY OF DEMAND FOR SELECTED FOOD PRODUCTS, UNITED STATES. AND CANADA Un i t e d S t a t e s Canada 1 o Daly Macfarlane Beckford-* Menzies and and B l a c k 2 S c h e f r i n 4 Products 1948 1958 1926 - 6 2 1926-80 C e r e a l ( t o t a l ) -2 . 3 3 -0 . 1 5 Wheat -0 . 1 5 Wheat and F l o u r -0.20 F l o u r ( i n c l u d i n g rye) -0 . 1 5 Potatoes 0.42 -0.20 Potatoes and Sweet Potatoes - 0 . 2 5 Other S t a r c h es (sugar,syrup) 0.07 F r u i t s 0 . 3 2 0 . 3 2 Vegetables 0 . 2 5 1 . 6 9 0 . 2 5 O i l and Fats ( e x c l u d i n g 0.06 0.06 b u t t e r ) D a i r y Products ( t o t a l ) 0.01 0.31 0.01 F l u i d M i l k and Cream 0.12 0.14 0.00 F l u i d M i l k 0.10 B u t t e r -0.10 0 . 8 6 -0.40 Meats ( t o t a l 0 . 2 5 0 . 3 5 Beef and V e a l 0.40 Beef 0.40 0.40 0 . 1 9 V e a l Pork 0.20 0 . 3 0 -1.43 0 . 3 0 Lamb and Mutton 0 . 2 5 P o u l t r y 0.40 1 . 1 3 0.40 Chicken and Turkey 0 . 3 0 1.12 Eggs 0 . 1 5 0 . 1 5 0 . 3 7 0 . 1 5 Lamb -O . 8 9 Red Meats 0 . 3 5 Cheese 0.71 Margarine -1.09 Lard - 1 . 8 5 S h o r t e n i n g -0.49 C o f f e e 0 . 2 3 Tea - 0 . 3 5 Sugar 0.18 Wheat F l o u r - 1 . 6 7 Sources: i D a l y , o p . c i t . Table I I , p.80. 2Macfarlane & B l a c k , o p . c i t . , p. 7 . 3 B e c k f o r d , l o c . c i t . 4M.W. Menzies & F.Schefrin,"Demand Outlook f o r Canadian A g r i c u l t u r e , " Resources f o r Tomorrow Conference, I, ( J u l y 1 9 6 1 ) , .Table V, p. 2 3 . 15 Aggregate S u p p l y Responses The aggregate s u p p l y f u n c t i o n o f f a r m p r o d u c t s ( i n the s h o r t - r u n ) i s i n e l a s t i c t o changes i n p r i c e , a l t h o u g h i t does s h i f t t o the r i g h t i n p e r i o d s o f p r o s p e r i t y a i d e d by t e c h n o l o g i c a l changes. However, a c o r r e s p o n d i n g s h i f t downwards i s not m a n i f e s t e d i n p e r i o d s o f d e c l i n i n g g g e n e r a l p r i c e s . The e x p l a n a t i o n f o r t h i s p e r v e r s e r e a c t i o n has c r e a t e d much c o n t r o v e r s y ever s i n c e G a l b r a i t h and B l a c k p r e s e n t e d t h e i r h y p o t h e s i s f o r the maintenance o f a g r i c u l t u r a l g p r o d u c t i o n d u r i n g the d e p r e s s i o n y e a r s . A b r i e f r e v i e w o f c u r r e n t hypotheses f o r the p e r v e r s e r e a c t i o n o f the a g r i c u l t u r a l s u p p l y curve and i t s i n e l a s t i c i t y i s g i v e n below. G a l b r a i t h and B l a c k were among t h e e a r l i e s t proponents of t h e t h e o r y of f i x e d a s s e t s which t r a c e s the n e u t r a l r e a c t i o n of f a r m e r - e n t r e p r e n e u r s e s p e c i a l l y i n the s h o r t - r u n , t o f l u c t u a t i n g f a rm p r o d u c t p r i c e s t o t h e preponderance o f f i x e d a s s e t s i n t h e fa r m a s s e t s t r u c t u r e and a l o n g p r o d u c t i o n p e r i o d f o r most crops and e n t e r p r i s e s . The i m p l i c i t a s s u m p t i o n i n t h i s t h e o r y i s t h a t the f a r m a s s e t s t r u c t u r e c o n t r i b u t e s t o the c o n t i n u o u s employment o f farm r e s o u r c e s . ^ The p s y c h o l o g i c a l approach of the B r e w s t e r - P a r s o n s t h e s i s h o l d s t h a t the u n i t y of f u n c t i o n s performed by the Sj.K. G a l b r a i t h and J.D. B l a c k , "The Maintenance o f A g r i c u l t u r a l P r o d u c t i o n D u r i n g D e p r e s s i o n : the E x p l a n a t i o n s Reviews," J o u r n a l o f P o l i t i c a l Economy. I V L , June 1938. 9 l b i d . T P . 3 2 2 . 16 farmer ( l a b o u r , t e c h n i c a l and managerial) tends t o make a l l costs i n a time p e r i o d i n f l e x i b l e .•J-° I n the f a m i l y farm, e s p e c i a l l y , the o c c u p a t i o n a l u n i t y of f u n c t i o n s gives r i s e , f i r s t , t o a w o r k m a n l i k e - l i v e l i h o o d frame of mind; second, t o a v a r i a b l e c o s t s t r u c t u r e f o r the f i r m as a whole which i s both s m a l l and r e l a t i v e l y constant through-out the range of m e c h a n i c a l l y p o s s i b l e outputs; and, t h i r d , t o an i n a b i l i t y to develop a mental p i c t u r e of comparative costs and revenues f o r contemplated e n t e r p r i s e s , a l l of which c a l l f o r output t o the l i m i t s of t e c h n o l o g i c a l c a p a c i t y i n the hopes of maximizing p r o f i t s . H Resources a r e , t h e r e f o r e , f u l l y employed although a g r i c u l t u r a l product p r i c e s vary. A b a s i c a l l y s i m i l a r argument i s proposed by Cochrane t o e x p l a i n the i n e l a s t i c i t y of the aggregate output curve. "The p e c u l i a r u n i t y of o c c u p a t i o n a l f u n c t i o n s ( l a b o u r , t e c h n i c a l and business management), f i x i t y of labour supply and the importance of overhead costs compared with o p e r a t i n g c o s t s on f a m i l y farms," argue f o r the p l a u s i b i l i t y o f the 12 i n e l a s t i c aggregate supply curve. I n another t h e s i s , w r i t t e n j o i n t l y w i t h Butz, he a s s e r t s t h a t i n the s h o r t - r u n , the e l a s t i c i t y of the aggregate supply curve tends t o be zero or n e a r l y so because of the 1^  f i x i t y of inputs i n the farm s t r u c t u r e . 1 0J.M.Brewster and H.L.Parsons, "Can P r i c e s A l l o c a t e Resources i n American A g r i c u l t u r e ? " J o u r n a l of Farm Economics, XXVII, Nov. 194-6. i : L I b i d . . p. 957. 1%.I.Cochrane,"Farm P r i c e G y r a t i o n s - an Aggregative H y p o t h e s i s . " J o u r n a l of Farm Economics. XXLX,May 1947, p.384. •^W.W.Cochrane and W.T. Butz, "Output Responses of Farm F i r m s , " J o u r n a l of Farm Economics. XXXIII, Nov. 1951. 17 The authors argue, however, t h a t i t i s only on f a m i l y farms that t h i s i n e l a s t i c i t y i s prominent. Land, b u i l d i n g s , machinery and equipment, breeding s t o c k and l a b o u r are f i x e d because of three f a c t o r s , v i z . , the customary p r a c t i c e s i n the community, the purchase of land and equipment on l o n g -term c o n t r a c t s , and the d e s i r e to provide f o r the f a m i l y . 1 4 ' A s i g n i f i c a n t c o n t r i b u t i o n t o the theory of f i x e d a s s e t s i n e x p l a i n i n g the nature of the i n f l e x i b l e s upply r e a c t i o n s t o downward movements i n p r i c e s has been made by G.L. J o h n s o n . 1 ^ To analyze the e f f e c t s of the f i x e d a s s e t s of the f a r m - f i r m on i t s output f u n c t i o n , he c a t e g o r i z e s them i n t o nine d i v i s i o n s (non-farm produced d u r a b l e s , un-s p e c i a l i z e d farm d u r a b l e s , s p e c i a l i z e d farm d u r a b l e s , u n s p e c i a l i z e d farm expendables, s p e c i a l i z e d farm expendables, non-farm expendables, h i r e d l a b o u r , f a m i l y and o p e r a t o r ' s l a b o u r and land) and p o s t u l a t e s the expected changes i n t h e i r salvage v a l u e s , a c q u i s i t i o n p r i c e and the m a r g i n a l value p r o d u c t i v i t i e s i n times of p r o s p e r i t y and d e p r e s s i o n (as i n d i c a t e d i n h i s system by i n c r e a s e d and f a l l i n g p r i c e s f o r farm p r o d u c t s ) . The most s i g n i f i c a n t c o n c l u s i o n s t h a t Johnson a r r i v e s at r e g a r d i n g the aggregate supply curve a r e : l^Cochrane and Butz, o p . c i t . p. 448 . .Johnson, "Supply Functions - Some Fa c t s and Notions", c i t e d i n E.O.Heady and o t h e r s , eds. A g r i c u l t u r a l  Adjustment Problems i n a Growing Economy. Ames, The Iowa S t a t e C o l l e g e P r e s s , 1958, pp. 74-93. 18 1. I t has an e l a s t i c i t y g r e a t e r t h a n z e r o at the f o u r d i f f e r e n t l e v e l s of employment and business a c t i v i t y considered ( r e c o v e r y , p r o s p e r i t y , r e c e s s i o n and d e p r e s s i o n ) . 2. I t i s more e l a s t i c t o i n c r e a s e s i n p r i c e than t o downward movements i n p r i c e . 3. I t i s more r e s p o n s i v e t o i n c r e a s i n g p r i c e s at f u l l p r o s p e r i t y p e r i o d s and d u r i n g recovery t h a n d u r i n g r e c e s s i o n s or d e p r e s s i o n s . 4. I t i s l e s s e l a s t i c t o f a l l i n g p r i c e s d u r i n g p r o s p e r i t y and r e c o v e r y than at r e c e s s i o n s and d e p r e s s i o n s H i s v a r i o u s hypotheses i n d i c a t e t h a t f i x e d a s s e t s ( l a n d , f a m i l y - l a b o u r , non-farm d u r a b l e s ) i s a s i g n i f i c a n t determinant of the i n e l a s t i c i t y of the aggregate supply curve t o p r i c e changes. Thus f a r i t can b e . a s s e r t e d t h a t the t o t a l supply curve f o r a g r i c u l t u r e i s i n e l a s t i c throughout i t s whole range although i t does e x h i b i t a g r e a t e r degree of respons-iveness t o upward p r i c e swings than i t does to f a l l i n g p r i c e s . While being i n e l a s t i c , s h i f t s i n t o t a l output through time i s p o s s i b l e and i n d i c a t i v e of the e f f e c t s of t e c h n o l o g i c a l p r o g r e s s . T h i s i n d i c a t e s the i n t r o d u c t i o n of more e f f i c i e n t f a c t o r s r a t h e r t h a n a q u a n t i t a t i v e i n c r e a s e i n farm i n p u t s . ^ J o h n s o n , O P . c i t . pp.88-89. S c h u l t z has observed that the q u a n t i t y of inputs committed t o a g r i c u l t u r a l p r o d u c t i o n i s the most i n f l e x i b l e v a r i a b l e 1 7 i n a g r i c u l t u r e . In support of t h i s statement Cochrane has c a l c u l a t e d t h at d u r i n g the p e r i o d 1920 - 1950, the index of t o t a l i n p uts i n c r e a s e d by 10$. I n d i v i d u a l Commodity Responses In g e n e r a l i t i s b e l i e v e d t h a t while the i n d i v i d u a l a g r i c u l t u r a l commodity supply schedules are i n e l a s t i c , they are r e l a t i v e l y more s e n s i t i v e t o p r i c e v a r i a t i o n s than the aggregate supply curve. The e l a s t i c i t y of the commodity supply f u n c t i o n depends on the: 1. Time p e r i o d of the p r o d u c t i o n c y c l e of the product. 2. E x i s t e n c e and extent of p r o d u c t i o n a l t e r n a t i v e s . 19 3. Closeness of e x i s t i n g p r o d u c t i o n a l t e r n a t i v e s . In the s h o r t - r u n , e s p e c i a l l y f o r s i n g l e - e n t e r p r i s e f a m i l y - f a r m s , where the o p p o r t u n i t y f o r the d i v e r s i o n of resources i s l i m i t e d , the i n d i v i d u a l commodity supply curve i s i n e l a s t i c . For m u l t i p l e - e n t e r p r i s e farms however, i n t e r -e n t e r p r i s e s u b s t i t u t i o n of resources makes the farmer more res p o n s i v e to p r i c e changes. Resource Response i n the Okanagan F r u i t Industry Graphs 1 t o 6 are used to i l l u s t r a t e the s t a b i l i t y 1 %.I.Cochrane, " C o n c e p t u a l i z i n g the Supply R e l a t i o n i n A g r i c u l t u r e " , J o u r n a l o f Farm Economics, XXX.VII, Dec. 1955? p.1167. 1 9 I b i d . . p.II63. 20 of resource use i n the Okanagan f r u i t i n d u s t r y t o v a r i a t i o n s i n product p r i c e s r e c e i v e d . They compare the number of f r u i t t r e e s ( o f a l l ages) w i t h the average value (at the farm l e v e l ) o f the f r u i t s o l d f o r the p e r i o d 1945-195 5. For a p r i c o t s , c h e r r i e s and pears there i s a d i s t i n c t l y i n c r e a s i n g t r e n d i n the number of t r e e s compared w i t h the f l u c t u a t i o n s of the average f r u i t v alues r e c e i v e d by the farmer. T h i s i l l u s t r a t e s t h a t resource use, as here d e f i n e d , i s , at the most, very l i t t l e a f f e c t e d by the average X income r e c e i v e d ; % . , the farmer's use of resources i s i n e l a s t i c t o f r u i t r e t u r n s . In the case of plums, prunes, peaches, apples and c r a b - a p p l e s , although t h e r e i s a v a r i a t i o n i n the number of f r u i t t r e e s e s p e c i a l l y f o r the l a s t two f r u i t s , an apparent i n e l a s t i c i t y t o product p r i c e movements i s e x h i b i t e d . I n summary, wh i l e the p r i c e e l a s t i c i t y o f the aggregate supply f u n c t i o n of a g r i c u l t u r a l products i s very low, those f o r s p e c i f i c commodities v a r y . I t would appear t h a t apart from the u n c e r t a i n t i e s t h a t a l l farmers f a c e , t h e i r psycho-l o g i c a l s t r u c t u r e has much t o do w i t h t h e i r r e s p onsiveness t o p r i c e . As both S c h u l t z and Cochrane have p o s t u l a t e d , the race between a burgeoning supply and a r e l a t i v e l y s t a t i c demand f o r a g r i c u l t u r a l commodities seems t o be i n favour of the former.20 For a g r i c u l t u r e as a whole and farmers 20 T . W. S c h u l t z , A g r i c u l t u r e i n an Unstable Economy. New York, McGraw-Hill Book Co.Inc., 1945, pp.44-81. Cochrane, Farm P r i c e s , M y t h or R e a l i t y , o p . c i t . pp.85-94. Graph 1. Average value of apricots marketed compared with number of apricot trees (all ages), Okanagan Valley, 1945-1955. Source: (for graphs 1-6) 1. B.C., Department of Agriculture, Orchard Survey of the Okanagan Valley, 1955, Victoria, 1955, p. 4. 2. Canada, Department of Agriculture, Crop and Seasonal Summaries, Production and Marketing Branch. ro ro 4 0 0 r T4.00 number of pear trees Q 3 5 0 O O 3 0 0 </> a> <D o 2 5 0 Q> E 3 2 0 0 N A N / \ average value of pears 3.50 3 -O 3 .00 3 o > 2 .50 2 Q> > < 2 .00 I I u J I I I L. 1945 '46 '47 '48 '49 r 5 0 "51 '52 '53 '54 '55 Year Graph 3. Average value of pears marketed compared with number of pear trees (al l ages ) , Okanagan Va l l ey , 1 9 4 5 - 1 9 5 5 . o o o o> CD h-O 1150 r 1100 1050 " CD E = 1 0 0 0 number of apple and crab-apple trees 2 .00 average value of apples and crab-apples © o 1.50 1.00 0 . 5 0 1945 '46 '47 '48 '49 ' 5 0 '51 ' 52 '53 '54 ' 5 5 Y e a r Graph 4. Average value of apples and c rab-app les marketed compared with number of apple and c r a b - a p p l e trees (all a g e s ) , Okanagan Valley , 1945 — 1955. 2 5 0 r o o o 2 0 0 X cn CD CD 4. 1- 150 o CD 1 0 0 E 3 •z. 5 0 average value of plums and prunes number of plum and prune trees 1945 '46 '47 '48 '49 '50 '51 '52 '53 '54 '55 Year 2.50 3 2.00 _Q \ O k CD 1.50 3 o > CD O 1.00 CD > < 5 0 Graph 5 . Average value of plums and prunes marketed compared with number of plum and prune trees (a l l ages ) , Okanagan Va l l ey 9 1 9 4 5 - 1 9 5 5 . O 4 0 0 O O t/> 3 5 0 CD CD O 3 0 0 CD £ 3 2 2 5 0 average value of peaches number of peach trees J i i_ _i i i i_ J i_ 4.00 3 JD \ 3.00 -CD _3 CD 2.00 g> CD >• < 1.00 1945 '46 '47 '48 '49 '50 '51 '52 *53 '54 '55 Year Graph 6. Average value of peaches marketed compared with number of peach trees (al l ages) , Okanagan Val ley , 1 9 4 5 - 1 9 5 5 . i n d i v i d u a l l y , the consequences are s i m i l a r : the p r i c e - c o s t squeeze l e a d s t o r e l a t i v e l y low incomes f o r the a g r i c u l t u r a l s e c t o r . The problem of p r o g r e s s i v e d e c l i n e s i n the p r i c e e l a s t i c i t y of farm products and the i n c r e a s i n g supply was evid e n t a l o n g time ago. Davis observes t h a t "the problem of depressed farm income i s i n no sense a recent one. I t was behind the Grange Movement of the 1870 's and the P o p u l i s t and Free S i l v e r Movements of the 1890's". Moreover i t is h i s c o n t e n t i o n that t h i s problem r e f l e c t e d i t s e l f i n the spread of co o p e r a t i v e marketing a f t e r World War I and f i n a l l y the A g r i c u l t u r a l Marketing Act of 1929. 2 1 I t was no l e s s w i t h the Canadian farmer. The e a r l y c o - o p e r a t i v e movements sprang out of d i s s a t i s f a c t i o n with low r e t u r n s and culminated i n the N a t u r a l Products Marketing A c t , 1934, g i v i n g farmers l e g i s l a t i v e s a n c t i o n f o r c o l l e c t i v e a c t i o n f o r t h e i r b e n e f i t . J.H. D a v i s , "From A g r i c u l t u r e t o A g r i b u s i n e s s " , Harvard  Business Review. XXXIV, Jan.-Feb. 1956, p.110. CHAPTER I I I DEVELOPMENT OF AGRICULTURAL MARKETING BOARDS T h i s chapter presents a b r i e f a n a l y s i s o f the f a c t o r s c o n t r i b u t i n g t o the e x i s t e n c e of marketing boards i n Canada, and a c l a s s i f i c a t i o n of Canadian marketing boards. To round o f f the chapter the l e g i s l a t i v e base and t h e o r e t i c a l extent of the powers of the B . C . F r u i t Board i s examined. There are three main f a c t o r s r e s p o n s i b l e f o r the development o f a g r i c u l t u r a l marketing boards. They a r e : a. The low and f l u c t u a t i n g income of farmers. b. The f a i l u r e of c o o p e r a t i v e s because of recusancy and t h e i r i n a b i l i t y t o pr o v i d e e f f e c t i v e counter-v a i l i n g power. c. The problem of c o n c e n t r a t i o n o f market power i n a g r i c u l t u r a l p r o c e s s i n g and supply i n d u s t r i e s . I n the previous chapter an examination of the causes of the "farm-problem" has been g i v e n . I t s s i g n i f i c a n t m a n i f e s t a t i o n s are f l u c t u a t i n g p r i c e s and f l u c t u a t i n g incomes. To provide some evidence of t h i s , r e f e r e n c e i s made t o the p r i c e curves i n Graphs 1 - 6 and Table V below, which g i v e s the t o t a l farm value of a p r i c o t s , peaches, pears, plums, prunes, sweet c h e r r i e s , crab-apples and apples f o r the Okanagan V a l l e y d u r i n g the p e r i o d 194-7 - 1962. The t o t a l farm value from the s a l e of r e g u l a t e d 29 f r u i t has been expressed by means of an index w i t h 1947 as the a r b i t r a r y b a s e - y e a r . TABLE V INDEX OF TOTAL FARM VALUE, REGULATED FRUITS., OKANAGAN VALLEY, 1947 - 1962 Year A b s o l u t e Farm Value Index of Farm Value 1947 1948 1949 1950 1951 1952 1953 1954 1955 1956 1957 1958 1959 I960 1961 1962 (1 thousands) (1947 -14,255 100. 13,601 95.4 10,688 74.8 7,784 54.6 9,204 64.6 11,409 80.0 10,910 76.5 9,022 63.3 7,862 55.2 8,535 59.9 22,108 155.1 9,978 70.0 9,799 68.7 14,511 101.8 14,423 101.2 16,317 114.5 S o u r c e : Canadian Department of A g r i c u l t u r e , P r o d u c t i o n and M a r k e t i n g B r a n c h , Markets I n f o r m a t i o n S e c t i o n , Crops and Seasonal P r i c e Summaries. 1945 - 1955, Ottawa. 30 I t i s important t o note t h a t the incomes o f the farmers are s u b j e c t t o y e a r l y f l u c t u a t i o n s . During the periods 1 9 4 7 - 1 9 5 0 , 1 9 5 2 - 1 9 5 4 , 1 9 5 7 - 1 9 5 9 and 1960-1961, crop v a l u e s are on the d e c l i n e . A s i g n i f i c a n t c h a r a c t e r i s t i c t o note i s t h a t r e l a t i v e t o 1947, excepting 1 9 5 7 , i 9 6 0 , 1 9 6 1 and 1962, a l l crop values are lower. Three stages can be t r a c e d i n the e v o l u t i o n a r y l a d d e r l e a d i n g to the i n s t i t u t i o n of marketing boards. a. Attempts by farmers unions to persuade govern-mental a u t h o r i t i e s t o impose c o n d i t i o n s of pure c o m p e t i t i o n i n a l l s e c t o r s of a g r i c u l t u r e . b. Autonomous e f f o r t s by farmers through c o o p e r a t i v e s t o m a i n t a i n the c o n d i t i o n s of pute c o m p e t i t i o n by competing w i t h p r i v a t e f i r m s i n the a g r i c u l t u r a l supply and p r o c e s s i n g i n d u s t r i e s . c. Government i n t e r v e n t i o n i n the a g r i c u l t u r a l economy r e s u l t i n g i n the g r a n t i n g of semi-monopoly power to farmers w i t h the c r e a t i o n of marketing boards. The most s i g n i f i c a n t f a c t o r r e s p o n s i b l e f o r the growth of farmer o r g a n i z a t i o n s ( i n c l u d i n g marketing boards) has been what G a l b r a i t h has termed c o u n t e r v a i l i n g power t o that wielded by the s u p p l i e r s of farm i n p u t s and the buyers of farm 2 ? p r o d u c t s . J . K . G a l b r a i t h , American C a p i t a l i s m The Concept o f C o u n t e r v a i l i n g Power. Boston, Houghton M i f f l i n Co., 1 9 5 6 , pp . 108-134 . From the e a r l i e s t p e r i o d s of Canadian and American a g r i c u l t u r e , the b a s i c form o f t h i s problem has remained unchanged. The numerical preponderance of farmers has faced w i t h In the market a r e l a t i v e l y s m a l l number of o l i g o p o l i s t s and o l i g o p s o n i s t s . An important c o r o l l a r y was the s m a l l s i z e of the farm f i r m compared w i t h the l a r g e and concentrated nature of the food p r o c e s s o r - f a r m supply i n d u s t r i e s ( f o r an i n d i c a t i o n of t h i s l a t t e r phenomenon i n Canada and the U.S., see T a b l e s XV and XVI i n Appendix I ) . As L a n z i l o t t i has s t a t e d an unequal balance of economic power i n the market r e s u l t e d i n d i s p r o p o r t i o n a t e b a r g a i n i n g power of the a g r i c u l t u r a l i n d u s t r i e s . Thus where i n d i v i d u a l farmers were i n h e r e n t l y unable t o e x e r c i s e any p o l i c i e s d e p a r t i n g from that which p e r f e c t c o m p e t i t i o n f o r c e s upon them, t h e i r opposite f o r c e s c o u l d , i n d i v i d u a l l y or i n c o n c e r t , f o l l o w p e r s i s t e n t l y p r i c e , product and marketing p o l i c i e s i n a manner d i f f e r e n t from the conduct a compet-e t i v e l y - s t r u c t u r e d market would impose upon f i r m s . 2 3 T h i s c o n c e n t r a t i o n i n a g r i c u l t u r a l i n d u s t r i e s l e d by the beginning of the f i r s t World War, t o marketing c o o p e r a t i v e s i n the P r a i r i e s . They attempted t o p r o v i d e c o m p e t i t i o n to the l i n e e l e v a t o r s and other commercial or g a n i z a t i o n s . 2 4 Although the e a r l y wheat-marketing c o o p e r a t i v e s R.F. L a n z i l o t t i , "The S u p e r i o r Market Power of Food P r o c e s s i n g and A g r i c u l t u r a l Supply Firms", J o u r n a l  of Farm Economics. X L I I , Dec. I960, p. 1229. "For a comprehensive e x p o s i t i o n s e e , f o r i n s t a n c e , R.D. C o l q u e t t e , The F i r s t F i f t y Years. Winnipeg, The P u b l i c Press L t d . , 1959. 32 d i d not s u f f e r overmuch from recusancy, t h i s was an ever present t h r e a t t o t h e i r e x i s t e n c e . The very philosophy of c o o p e r a t i o n based on v o l u n t a r y p a r t i c i p a t i o n i s the cause of t h i s t h r e a t . One of the e a r l y farmer o r g a n i z a t i o n s which s u f f e r e d from t h i s was the Okanagan U n i t e d Growers C o o p e r a t i v e . I t s e a r l y success i n the r e g u l a t i o n of the supply of f r u i t s provided the i n c e n t i v e f o r g r e a t e r p r o d u c t i o n with consequently d e l e t e r i o u s e f f e c t s upon p r i c e . As p r i c e s f e l l more and more of the growers d e s e r t e d the company and s t a r t e d s e l l i n g i n d e p e n d e n t l y . 2 ^ I h i l e the c o o p e r a t i v e s i n Canada have provided marketing f a c i l i t i e s to members r e s u l t i n g i n cost e f f i c i e n c y and maintained i f not pure at l e a s t workable competition, t h e i r impact has been d i m i n i s h e d by another b u i l t - i n d i sadvantage: the l a c k of supply c o n t r o l . The only way t o m a i n t a i n a h i g h p r i c e o b j e c t i v e i s t o c o n t r o l supply. T h i s c o n t r o l proves i n e f f e c t i v e because farmers then gear t h e i r p r o d u c t i o n t o these p r i c e s and o v e r p r o d u c t i o n r e s u l t s . Recusancy and i n e f f e c t i v e supply r e g u l a t i o n and, i n Canada, the success of the Canadian TOieat Board i n i t i a t e d demands from farmers f o r s i m i l a r c o n t r o l over t h e i r p r o d u c t s . The i m p l i e d o b j e c t i v e may have been g r e a t e r bargaining power 2^Canada, Royal Commission on Canada's Economic P r o s p e c t s : P r o g r e s s and Prospects of Canadian A g r i c u l t u r e . Ottawa, Queen's P r i n t e r , 1957, P. 292. as i s maintained by C l o d i u s or i n e f f e c t provide c o u n t e r v a i l i n g power. T h i s i s i n the Canadian context at l e a s t , a p a r t i a l l y t r u e statement s i n c e i n the n e g o t i a t i n g -type marketing boards, t h e r e i s c o u n t e r v a i l i n g power i n p r i c e n e g o t i a t i o n s w i t h processors but not so w i t h the c e n t r a l - a g e n c y type marketing board where p o s s i b i l i t i e s f o r d e a l i n g d i r e c t w i t h r e t a i l e r and f i n a l consumer e x i s t . Types of Marketing Boards An acceptable d e f i n i t i o n of marketing boards i n Canada i s : " A marketing board i s a compulsory, h o r i z o n t a l marketing o r g a n i z a t i o n f o r primary or processed n a t u r a l 27 products o p e r a t i n g under government-delegated a u t h o r i t y . " Marketing boards are b r o a d l y c l a s s i f i e d i n t o two c a t e g o r i e s : 1. Government boards. a. The Canadian 1/Sheat Board o p e r a t i n g under F e d e r a l a u t h o r i t y and e n a b l i n g p r o v i n c i a l l e g i s l a t i o n . b. D a i r y Products Marketing Boards e s t a b l i s h e d under p r o v i n c i a l P u b l i c U t i l i t y A c t s . 2. Producer Marketing Boards. These are of three types and i n c l u d e : ? 6 R.L. C l o d i u s , " O p p o r t u n i t i e s and L i m i t a t i o n s i n Improving the B a r g a i n i n g Power of Farmers", c i t e d i n Iowa S t a t e U n i v e r s i t y Centre f o r A g r i c u l t u r a l Adjustment, Problems  and P o l i c i e s of American Agriculture« Ames, The Iowa S t a t e U n i v e r s i t y P r e s s , I 9 6 0 , p. 30. ^ C a n a d i a n A g r i c u l t u r a l Economics S o c i e t y , S i x t h Annual Workshop Report, A g r i c u l t u r a l Marketing Boards« 1961, p. 34 a. N e g o t i a t i n g boards which n e g o t i a t e on b e h a l f of producers with the pr o c e s s o r ' s r e p r e s e n t a t i v e s the minimum p r i c e s of products a v a i l a b l e f o r s a l e t o p r o c e s s o r s . I n case of deadlock, an a r b i t r a t i o n board i s convened and once minimum p r i c e s are f i x e d the pr o c e s s o r s c o n t r a c t w i t h i n d i v i d u a l producers f o r s u p p l i e s of f r u i t . P r i c e e q u a l i z a t i o n of f r u i t used f o r p r o c e s s i n g i s o b t a i n e d . b. Boards which operate a c e n t r a l s a l e s agency. The e n t i r e supply o f the r e g u l a t e d products passes through the agency. c. Other boards t o dispose of s u r p l u s a g r i c u l t u r a l 2 8 commodities. There are f o u r important p i e c e s of l e g i s l a t i o n and r e g u l a t i o n s p e r t a i n i n g to the B.C. Tree F r u i t Scheme. The A g r i c u l t u r a l Products Marketing Act (Canada), 1949, t o g e t h e r w i t h the A g r i c u l t u r a l Products Marketing Act (Canada), B.C. Tree F r u i t Export R e g u l a t i o n s , 1963, f a c i l i t a t e the c o o p e r a t i o n of f e d e r a l and p r o v i n c i a l governments i n promoting o r d e r l y marketing and extends p r o v i n c i a l marketing l e g i s l a t i o n so th a t i n t e r p r o v i n c i a l and export trade may be c a r r i e d o ut. In a d d i t i o n , the N a t u r a l Products Marketing ( B r i t i s h Columbia) B.C. Tree F r u i t Scheme A c t , 1948, and the B.C. Tree F r u i t Marketing Scheme, i960, (Order-iriz/Council) are the instruments c r e a t i n g the B.C. F r u i t Board and a l l o w i n g f o r the appointment of the B.C. Tree F r u i t s L t d . t o c a r r y out the powers g i v e n i n the A c t . A d i s c u s s i o n of the powers of the F r u i t Board i s g i v e n below. It must he observed f i r s t that once a m a j o r i t y of growers votes f o r t h i s scheme, compulsory p a r t i c i p a t i o n by a l l i s mandatory. 1. The Board has the power i n p r o v i n c i a l , i n t e r -p r o v i n c i a l and export trade to promote, c o n t r o l , and r e g u l a t e the t r a n s p o r t a t i o n , packing, storage and marketing of r e g u l a t e d f r u i t s i n B r i t i s h Columbia. T h i s i n c l u d e s the p r o h i b i t i o n of any t r a n s p o r t a t i o n , packing, storage or marketing of the r e g u l a t e d f r u i t . 2. The marketing agency appointed by the Board has complete c o n t r o l over the r e g u l a t i o n of the f r u i t by area of d i s t r i b u t i o n , time of d i s t r i b u t i o n and use of the product. 3. The marketing agency i s vested w i t h the power of d e t e r m i n i n g the q u a l i t y , grade or c l a s s of the f r u i t s t h a t are t o be s o l d . In e f f e c t q u a l i t y , grade or c l a s s d i f f e r e n t i a t i o n of the v a r i e t i e s of f r u i t i n a s p e c i e s i s i n the hands of the c e n t r a l s e l l i n g agency. 4. The agency c o n t r o l s the maximum and minimum p r i c e s of d i f f e r e n t f r u i t s and t h e i r d i f f e r e n t grades and s i z e s , i n the d i f f e r e n t markets i n which r e g u l a t e d f r u i t i s s o l d * Apart from the power of p r i c e - f i x i n g , the c e n t r a l s e l l i n g agency i s empowered t o p r a c t i s e p r i c e d i f f e r e n t i a t i o n of i t s p r o d u c t s . 5 . To provide f o r the e q u a l i z a t i o n of r e t u r n s t o pro-ducers, i r r e s p e c t i v e of the end-use or plac e of consumption, a system of p o o l i n g r e t u r n s has t o be f o l l o w e d by the agency. 6 . The marketing agency i s empowered t o promote i t s product by j u d i c i o u s a d v e r t i s i n g . 7. The Board i s g i v e n r e g u l a t o r y c o n t r o l p e r t a i n i n g to r e g i s t r a t i o n of growers, insurance of l i c e n c e s , r e v o k i n g l i c e n c e s , p o l i c i n g the a r e a , c o n f i s c a t i n g and d i s p o s i n g of f r u i t which has been s o l d i n v i o l a t i o n of the Board's or d e r s , as w e l l as c o l l e c t i n g funds f o r the o p e r a t i o n of the Board and i t s agency. Hence a wide l a t i t u d e of powers i s g i v e n the Board and i t s agency, powers which, i n i s o l a t i o n , would be conducive t o the c r e a t i o n of a monopoly. However as w i l l be p o i n t e d out i n the conc l u d i n g chapter, c e r t a i n f a c t o r s make the complete u t i l i z a t i o n of powers i m p o s s i b l e . CHAPTER IV ANALYSIS OF THE POWERS OF THE BRITISH COLUMBIA FRUIT BOARD T h i s chapter d e a l s w i t h the s t r u c t u r e of the B.C. F r u i t Board and i t s r e l a t i o n s h i p w i t h the growers, s h i p p e r s , packers, canners and p r o c e s s o r s . The d i s t r i b u t i o n of the r e t u r n s of the s a l e of f r u i t s t o the growers i s i n v e s t i g a t e d as w e l l as the p o l i c i n g powers of the Board. S t r u c t u r e o f the B.C. F r u i t Board The o r g a n i z a t i o n and s t r u c t u r e of the B.C. F r u i H Board and the u n i t s i n t e g r a t e d i n t o i t a r e , per se, an e x e r c i s e o f the powers vested i n the Board by F e d e r a l and P r o v i n c i a l l e g i s l a t i o n . I t i s r e l e v a n t t h e r e f o r e , t o study the s t r u c t u r e below the Board from the p e r s p e c t i v e of h o r i z o n t a l and v e r t i c a l i n t e g r a t i o n . The whole marketing scheme i s a v e r t i c a l l y i n t e g r a t e d o r g a n i z a t i o n i n v o l v i n g growers, s h i p p e r s , processors and canners and the s o l e marketing agency (which a l s o performs some brokerage f u n c t i o n s ) . I t i s through B.C. Tree F r u i t s L t d . t h a t the Board manages the scheme. At the lowest l e v e l of p r o d u c t i o n , the compulsory p a r t i c i p a t i o n of a l l growers i n the Jruit marketing scheme i s a h o r i z o n t a l i n t e g r a t i o n of u n i t s o p e r a t i n g at the farm l e v e l . To a c e r t a i n e x t e n t , h o r i z o n t a l i n t e g r a t i o n a l s o e x i s t s among sh i p p e r s and packers, f o r those c o o p e r a t i v e l y owned. Hence the marketing scheme w h i l e being p r i m a r i l y the r e s u l t of v e r t i c a l i n t e g r a t i o n , a l s o owes i t s e x i s t e n c e t o the process of h o r i z o n t a l i n t e g r a t i o n . I n u s i n g a wide d e f i n i t i o n of " i n t e g r a t i o n " one must not o v e r l o o k the f a c t t h a t although f e d e r a l and p r o v i n c i a l l e g i s l a t i o n o p e r a t i n g through the o f f i c e s o f the F r u i t Board provide f o r the scheme's cohesion, not a l l d e c i s i o n s p e r t a i n i n g t o p r o d u c t i o n , canning, p r o c e s s i n g , packing and s h i p p i n g comes from i t . Below the l e v e l o f a u t h o r i t y of the Board, the growers, s h i p p e r s , canners and pro c e s s o r s and the marketing agency act wit h v a r y i n g degrees of exogeneous c o n t r o l over t h e i r decision-making f u n c t i o n s . Those r e l a t i n g t o the combination of re s o u r c e s and s c a l e of p l a n t f o r the growers, s h i p p e r s , p r o c e s s o r s , and canners, e s p e c i a l l y , l i e w i t h these separate u n i t s a l o n e . To a g r e a t e r extent i s t h i s t r u e of the privately-owned s h i p p i n g and packing houses and the p r o c e s s i n g and canning f i r m s who have only c o n t r a c t u a l o b l i g a t i o n s with the scheme. The primary b e n e f i t s of such an i n t e g r a t e d scheme i s assured d i s p o s a l o f the produce of the growers and guaranteed s u p p l i e s t o the processors and canners. B e n e f i t s accrue, n a t u r a l l y , to the growers as the scheme aims at the maintenance and s e c u r i t y of t h e i r income from the s a l e of r e g u l a t e d f r u i t . An a n c i l l a r y advantage of i n t e g r a t i o n i s the l a r g e -39 s c a l e economies not only of the v e r t i c a l l y i n t e g r a t e d scheme but of the s i n g l e marketing agency t o o . I h e r e the scheme i t s e l f i s concerned, g r e a t e r c o o r d i n a t i o n between the i n t e g r a t e d u n i t s ensures l e s s f r i c t i o n and a g r e a t e r f l e x i b i l i t y t o meeting changing market c o n d i t i o n s . The o r g a n i z a t i o n chart r e l e v a n t f o r the f r u i t marketing scheme i n B r i t i s h Columbia i s g i v e n below. One aspect of the o r g a n i z a t i o n chart which has s i g n i f i c a n c e here i s the r e l a t i o n s h i p of the canners, p r o c e s s o r s , packers and s h i p p e r s w i t h the B.C. Tree F r u i t s L t d . Of the t h i r t y - f o u r canners and p r o c e s s o r s r e g i s t e r e d w i t h B.C. Tree F r u i t s L t d . i n 196-3, the major pr o c e s s o r was Sun-Rype Products L t d . , a grower-owned o r g a n i z a t i o n run by separate management and assigned the s o l e r e s p o n s i b i l i t y f o r the d i s p o s a l of c u l l s . A l l the r e s t of the canners are separate and independent u n i t s . Each y e a r , based on h i s t o r i c a l quotas, B.C. Tree F r u i t s L t d . a l l o c a t e s v a r i o u s q u a n t i t i e s t o each p r o c e s s o r and canner. S.un-Rype Products L t d . i s the only p r o c e s s o r which d e a l s w i t h " p r o c e s s i n g grade" apples t o produce j u i c e , sauce, p i e - f i l l i n g s and other p r o d u c t s . I t has to accept, r e g a r d l e s s of v a r i e t y , q u a l i t y , s i z e and q u a n t i t y or date any f r u i t d i v e r t e d i n t o p r o c e s s i n g by B.C. Tree F r u i t L t d . The growers are under c o n t r a c t t o l o c a l packers and sh i p p e r s r e g i s t e r e d w i t h B.C. Tree F r u i t s L t d . These packers 40 and s h i p p e r s pack and supply f r u i t as r e q u i r e d by the s o l e marketing agency and t o the processors and canners on the i n s t r u c t i o n s of B.C. Tree F r u i t s l t d . FIGURE I ORGANIZATION CHART OF THE B.C. FRUIT MARKETING SCHEME A g r i c u l t u r a l Products Marketing Act (Canada) B.C. Tree F r u i t Export R e g u l a t i o n s N a t u r a l Products Marketing ( B r i t i s h Columbia) Act B.C. Tree F r u i t Marketing Scheme ( O r d e r - i n - C o u n c i l ) r~ : provides l e g a l ^ b a s i s f o r the ex i s t e n c e of the B.C. Tree F r u i t Marketing Scheme administered by the B. C . F r u i t Board which has appointed as the s o l e s e l l i n g agency and. assigned s o l e r e s p o n s i b -i l i t y f o r apple c u l l s t o B.C. Tree F r u i t s L t d . ^ s u b s i d i a r y 1 - * 3 S u n - - R v P e Products L t d . which d i s t r i b u t e s f r u i t t o I canners and p r o c e s s o r s I and f r e s h f r u i t t o / Western Canada, E a s t e r n Canada, United S t a t e s and Off - s h o r e markets which r e c e i v e s f r u i t from I 68 packing and s h i p p i n g houses, - ( c o o p e r a t i v e and independent) I who pack aid s h i p a c c o r d i n g t o B.C. Tree F r u i t L t d . i n -s t r u c t i o n s , f r u i t sent by I approximately 3400 growers who e l e c t delegates t o the B. C . F r u i t Growers 1 A s s o c i a t i o n which i s represented on the F r u i t Board. The net revenue c o l l e c t e d from the s a l e of f r u i t through B.C. Tree F r u i t s L t d . i s sent to s h i p p e r s who undertake t o d i s t r i b u t e i t a f t e r deducting t h e i r o p e r a t i o n a l c o s t s . The p o i n t t o observe i s t h a t at the B.C. Tree F r u i t L t d . l e v e l , average s h i p p i n g costs f o r a l l s h i p p e r s are i n c l u d e d i n the net revenues from the s a l e of f r u i t and thus those shippers who are more e f f i c i e n t and i n c u r l e s s costs are a b l e to d i s t r i b u t e a g r e a t e r patronage d i v i d e n d or e a r n h i g h e r p r o f i t s . Methods of D i s t r i b u t i n g Returns The most important r e l a t i o n s h i p between grower and shipper and the F r u i t Board i s the method of t r e a t i n g the v a r i o u s v a r i e t i e s , grades and s i z e of f r u i t sent by them f o r s a l e . The p o o l i n g system i s f o l l o w e d so as to provide e q u i t a b l e r e t u r n s to growers. Two p o o l i n g committees (on which i s represented the B.C. F r u i t Growers' A s s o c i a t i o n , B.C. Tree F r u i t s L t d . and the Okanagan Federated S h i p p e r s L i m i t e d ) have been i n s t i t u t e d f o r t h i s purpose. One i s the Industry S o f t F r u i t P o o l i n g Committee d e a l i n g w i t h plums, peaches, pea r s , prunes, a p r i c o t s and c h e r r i e s and the o t h e r i s the Industry Apple P o o l i n g Committee whose sphere of o p e r a t i o n i n c l u d e s apples and crab-a p p l e s . The main f u n c t i o n of the two committees i s t o study and advise on the method of p o o l i n g and s e t net p r i c e 42 d i f f e r e n t i a l s between grades, payments f o r premiums and di s c o u n t s and where necessary the t r a n s f e r e n c e of payments ( s u b s i d i e s ) from one p o o l t o another. Types of Pools There were three main types of pools i n 1963: a. D i r e c t p o o l i n g i n which the net r e t u r n s from the s a l e s i n the market f o r a v a r i e t y or group of v a r i e t i e s o f f r u i t were j o i n t l y p o o l e d . There was no t r a n s f e r e n c e of s u b s i d i e s i n t o or out of d i r e c t p o o l s . b. Y a r d s t i c k p o o l i n g through which a v a r i e t y or group of v a r i e t i e s o f f r u i t r e c e i v e d the net r e t u r n s over the whole marketing season based on pre-determined p r i c e s f o r the f r u i t . S u b s i d i e s i n t o or out of y a r d s t i c k pools may be made. c. T r e n d - l i n e p o o l s . B a s i c a l l y t h i s method i n v o l v e d the f i t t i n g of a t r e n d l i n e t o the s a l e p r i c e s o f a v a r i e t y or group of v a r i e t i e s o f f r u i t . Net payments were then made according t o twice-weekly t r e n d l i n e f i g u r e s . I t i s necessary t o d e f i n e the s u b s i d i a r y methods of payment used f o r the 1963 c r o p . I n t e r - p o o l s u b s i d i e s were made t o e q u a l i z e any marked d i f f e r e n c e s i n the revenues from the s a l e o f d i f f e r e n t grades or s i z e s of one type of f r u i t . In I963, the l a r g e s t s i n g l e i n t e r - p o o l subsidy was from the Regular D e l i c i o u s p o o l t o 29 the Red D e l i c i o u s p o o l . In the "cannery e q u a l i z a t i o n " procedure, the pooled r e t u r n s from the s a l e s of f r u i t d i v e r t e d t o canning were added t o f r e s h f r u i t revenues before d i s t r i b u t i o n t o growers. Bonus payments were made when the f r u i t s h arvested could be shipped without f u r t h e r s o r t i n g t o the market. Q u a l i t y c o n t r o l payments were made f o r f r u i t s t h a t were handled according t o c e r t a i n s t r i n g e n t s p e c i f i c a t i o n s . T a b l e VI gives a summary of the d i f f e r e n t types of pools i n o p e r a t i o n f o r a l l the r e g u l a t e d f r u i t of the I963 crop year^;» Pools can be of s e a s o n a l d u r a t i o n ( i e . , the l e n g t h of the marketing season) or fragmented i n t o p e r i o d p o o l s . The e a r l y pools normally r e c e i v e d premiums over the l a t e r maturing f r u i t o f other p e r i o d p o o l s . An a n a l y s i s o f the pools i n o p e r a t i o n f o r c h e r r i e s 30 and apples i s g i v e n below. Cherry Pools E i g h t groups of c h e r r i e s based on p h y s i c a l c h a r a c t e r i s t i c s were formed ( E a r l y B l a c k s , Other B l a c k s , Bings, Royal Annas, Deacons, Windsors, Other Whites and Kootenay S o u r s ) . Groups 3j 4 and 6 were operated on a tr e n d l i n e p o o l , w i t h Tuesday and F r i d a y p r i c e s determining the values f o r a 29 'Report of the Apple P o o l i n g Committee t o the 76th Annual Convention of the B r i t i s h Columbia F r u i t Growers* A s s o c i a t i o n , January 19-21, Vernon, 1965. 30 J For r e l e v a n t Tables d e a l i n g w i t h other f r u i t , see Appendix I I . t h r e e t o f o u r day p e r i o d . Cannery e q u a l i z a t i o n was a u t o m a t i c a l l y p r o r a t e d over the whole season. From Table V I I i t i s n o t i c e d that the d i f f e r e n t grades o f f r u i t w i t h i n one group (e.g. N o . l , Orchard-run) r e c e i v e unequal r e t u r n s . A l s o , the i n f e r i o r grade c h e r r i e s ( l o c a l m a t u r i t y and c h e r r i e s f o r p r o c e s s i n g ) r e c e i v e l e s s per pound than No. 1 f o r i n s t a n c e . The r e t u r n s r e c e i v e d f o r a l l the grades of c h e r r i e s i n the t r e n d - l i n e pools g r a d u a l l y decrease as the marketing season p r o g r e s s e s . Groups 1 , 2, 5 , 7 , 8 and the Jam Cherry group were close d on a season p o o l b a s i s . Although t h e r e s t i l l was a r e t u r n d i f f e r e n t i a l between the grades i n these groups, only one s e a s o n a l average r e t u r n was pa i d t o each grade. Apple Pools For apple's, twenty-eight groups were e s t a b l i s h e d , each on a season p o o l b a s i s . Separate pools were e s t a b l i s h e d f o r tfce "Cee" grade apples of a l l v a r i e t i e s . F o l l o w i n g the " y a r d s t i c k " p r i n c i p l e , the Industry Apple P o o l i n g Committee maintained a system of p r i c e d i f f e r e n t i a l s based on grade and s i z e s p e c i f i c a t i o n s . P r i c e d i f f e r e n t i a l s based on the s i z e c r i t e r i o n were not the same f o r each apple group. The "Cee" grades r e c e i v e d the l e a s t r e t u r n s among a l l the apple groups,(see Table V I I I ) . 45 TABLE VI SUMMARY OP POOLS FOR ALL REGULATED FRUIT,, 1963 CROP Type of Length of No. o f F r u i t P o ° l P e r i o d P o o l F r u i t Groups Prunes Season week 1 C h e r r i e s Trend l i n e 2-3 day 2 season whole season 6 A p r i c o t s Season* week 4 Plums Season f o r t n i g h t 5 Peaches Season week ( i n c l u d i n g 6 e a r l y p o o l s ) whole season 1 Pears Season whole season 6 Crab-apples Season 9 days 1 Season** whole season 1 Cookers 5-6 days 7 whole season 3 Apples Season whole season 28 x O r i g i n a l l y , f o r prunes and some a p r i c o t groups, the t r e n d - l i n e p o o l was used. However, due to the appearance of a h o r i z o n t a l t r e n d - l i n e , o n l y one p r i c e f o r the whole season was p a i d . xx For two areas, Okanagan and Creston. Sources P o o l i n g Regulations.1963 Crop, O f f i c e C i r c u l a r s K A ) and 1 (B), 1963 P o o l C l o s i n g C i r c u l a r s 1-11, B.C. Tree F r u i t s L t d . , 1963. TABLE V I I POOL RETURNS FOR CHERRIES, 1963 CROP P e r i o d Average Naked Pools Group Grade F r u i t R e t u r n s ( $ / 1 P ) Season Group 1 E a r l y Blacks No.l 4B .11771 Season Group 2 Other Blacks No.l 4B .11298 A Group 3 -4 .25726 Bings No.l 4B Process .16722 B it No.l 4B .24218 " PL .24218 O.R. 4B .21^96 C ti No.l 4B .22803 No.l 4B PL .22803 O.R. 4B .20523 n II P L .02523 Process .14822 D it No.l 4B .21482 ti it P L .21482 O.R. 4B .19334 ti tt P L .19334 » Bulk .19334 Cannery .21482 Process .13963 E it No.l 4B .20254 » PL .20254 O.R 4B .18229 ti tt P L .18229 Cannery .20254 Process .13165 F it No.l 4B .19121 tt .19121 0.R. 4B .17209 tt it P L .17209 Process .12428 G II No.l 4B .18081 O.R. 4B .16273 O.R. Bulk .16273 Cannery .18081 Process .11752 .../cont *d 47 P e r i o d Average Naked Pools Group Grade F r u i t Returns @/lb) H Group 3 N o . l 4B .17135 Bings OR. 4B L l .10024 O.R. 4B1.1;. .15421 O.R. B u l k .15421 Cannery .17135 Process .11138 I »• No.l 4B .16282 O.R. 4B .14654 O.R.Bulk .14654 Cannery .16282 Process .10583 J " Bulk .13971 No.l 4B .15523 O.R. 4B .13971 Cannery .15523 Process .10090 K " No.l 4B .14858 O.R. 4B .13373 « Bu l k .13373 Cannery .14858 Process .09658 L " N o .l 4B .14287 Cannery .14287 Process .09287 M '» No.l 4B .14287 N " No.l 4B .14287 S t a r Pack Premiums No.l .01875 " O.R. .01687 Season Group 5 Royal Annes No.l 4B .11415 O.R. Bulk .10273 Cannery .11415 A Group 6 Deacon 7 Wind- No.l 4B .22540 B s o r No.l 4B .20712 " O.R. 4B .17456 C " No.l 4B .19079 » PL .19079 O.R. 4B .16080 ../cont'd 48 P e r i o d Average Naked P o o l s Group Grade F r u i t R e t u r n s ( & / l b ) D Group 6 N o . l 4B .17641 Deacon 7 Wind- PL .17641 s o r O.R. 4B .14867 Cannery . 17641 P r o c e s s .11466 E " N o . l 4B .16397 " PL . 16397 O.R. 4B .13819 Cannery . 16397 F " N o . l 4B .15347 O.R. 4B .12934 O.R. B u l k .12934 Cannery . 15347 P r o c e s s .09976 G N o . l 4B .14492 O.R. 4B .12214 O.R. B u l k .12214 Cannery .14492 P r o c e s s .09420 H N o . l 4B .13832 O.R. 4B .11657 Cannery .13832 I »» N o . l 4B .13366 O.R. 4B .11265 Cannery .13366 J Group 6 Deacon & Windsor N o . l 4B .13095 Cannery . 13095 K " N o . l 4B .13018 Cannery .13018 S e a s o n Group 7 Other W h i t e s Cannery .10181 " Group 8 Kootenay Sours N o . l 4B .10945 " A l l Groups Jam B u l k . 0 5 7 0 5 S o u r c e : P o o l C l o s i n g C i r c u l a r N o . l , B.C. Tree F r u i t s L t d . , September 10, 1963. 49 TABLE V I I I POOL RETURNS, FOR ALL APPLES., 1963 CROP Grade,Size, Group and V a r i e t y DELICIOUS, X Fey L M S, XS UNSIZED L MAT L FCY L M S XS UNSIZED RED DELICIOUS X Fey L M S XS, UNSIZED FCY L M S XS UNSIZED C A X FCY L M S XS FCY L M S XS GOLDEN DELICIOUS, X FCY XL L M • S XS FCY XL L M S XS Average Naked F r u i t Returns ( S / l b ) .03676 .03676 .03548 .02983 .03644 .023 89 .02574 .02872 .02410 .01513 .02693 .04415 .04415 .04114 .03884 .04387 .03151 .03151 .02646 .02485 .03063 .04415 .04415 .04114 .03884 .03151 .03151 .02646 .02485 .05045 .06348 .06417 .06045 .04836 .04092 .05441 .05603 .05278 .03673 ... ./cont f d Grade, S i z e , Group and V a r i e t y Average Naked F r u i t R e t u r n s ( S / l b ) JONATHAN X FCY .00495 FCY .00495 McINTOSH X FCY L .01972 M .04715 a .02921 xs .02690 L-M .04576 UNSIZED .04299 L MAT M .03064 UNSIZED .02794 FCY L .01044 M .03351 S .02249 XS, .01993 L-M .03225 UNSIZED .03023 L MAT M .02170 UNSIZED .01965 C A E FCY UNSZD .04299 FCY UNSIZED .03023 NEWTOWN X FCY L .04029 M .04074 s .03869 xs .03869 UNSIZED .04016 FCY L .02760 M .03522 s, .03060 xs .03326 ROMES X FCY .02274 FCY .01774 RED ROMES, X FCY L .05000 M .05000 S .04880 XS .04061 UNSIZED .04988 Grade,Size,Group And V a r i e t y Average Naked F r u i t Returns ( $ / l b ) RED HOMES. FCY L M s XS, UHSIZED SPARTAN X FCY L M S XS UNSIZED FCY L M S XS UNSIZED CA X FCY FCY S XS L M S XS STAYMAN X FCY L-M-& XS VCY L-M-S. XS RED STAYMAN X FCY L M S XSJ UNSIZED FCY L M S XS UNSIZED .03796 .03796 .03676 .02857 .03774 .04214 .04764 .03703 .03703 .04625 .03764 .03764 .02597 .02597 .03626 .04214 .04764 .03703 .03703 .03764 .03764 .02597 .02597 ,00495 .00495 .00495 .00495 .02643 .03534 .02932 .02691 .03238 .02282 .02884 .02282 .02041 .02607 Grade, S i z e , Group And V a r i e t y  Average Naked F r u i t Returns ( S / l b ) JUBILEE & S. 5.4. X FCY FCY SUNDRY X FCY FCY .03373 .02111 .01818 .01818 WINESAP X FCY FCY ; L M S XS UNSIZED S XS UNSIZED GOLDEN DELICIOUS CEE XL L M a xs UNSIZED N E W T 0 1 N S CEE L MM S XS UNSIZED .'04357 .04357 .02892 .02131 .03578 .03090 .03090 .02003 .01584 .02529 .02457 .02457 .02457 .02457 .02457 .02457 .01072 .01072 .01072 .01072 .01072 RED ROMES CEE 01421 53 Grade, S i z e , Group and V a r i e t y  SPARTANS. CEE L M S XS UNSIZED CEE CA L WINES APS CEE Average Naked F r u i t R e t u r n s ( & / l b ) .01609 .01609 .01609 .01609 .01609 .01609 .01609 .01609 .00734 ^ o u r c e : P r e l i m i n a r y P o o l C l o s i n g C i r c u l a r No. 1 1 , B.C. Tree F r u i t s L t d . , June 11, 1964. Summary Thus no f i x e d system of p o o l i n g i s f o l l o w e d e i t h e r f o r a l l f r u i t s c o n s i d e r e d , o r f o r each of the two groups o f f r u i t . Some are opera t e d on a p e r i o d p o o l b a s i s and s t i l l o t h e r s p o o l the r e t u r n s f o r the whole m a r k e t i n g s e a s o n . There does not' seem t o be a c o n s i s t e n t p r i n c i p l e u n d e r l y i n g the s e l e c t i o n o f the type of p o o l o r the number of p e r i o d p o o l s . I t s h o u l d be noted t h a t t h e average naked f r u i t r e t u r n s d e c r e a s e as the m a r k e t i n g s e a s o n reaches c o m p l e t i o n . T h i s h o l d s t r u e e s p e c i a l l y f o r the t r e n d - l i n e p o o l s and the p e r i o d p o o l s . T h i s does not h o l d t r u e however, f o r payments made from the season p o o l s . A system o f i n c e n t i v e s i s p r o v i d e d t o encourage e a r l y h a r v e s t i n g and d e l i v e r y t o t h e s h i p p e r s and p a c k e r s . These come i n the form o f premium payments and guaranteed r e t u r n d i f f e r e n t i a l s between t h e e a r l y and l a t e r p o o l s . I n t e r - p o o l t r a n s f e r e n c e o f s u b s i d i e s was p r a c t i c e d o n l y f o r the w i n t e r - a p p l e c r o p of 1963. Cannery grades o f f r u i t u s u a l l y r e c e i v e l e s s r e t u r n s t h a n f r e s h f r u i t w h i l e t h e p r o c e s s i n g grades r e c e i v e con-s i s t e n t l y l o w e r r e t u r n s t h a n f o r e i t h e r g r a d e . F o r the cannery grades o f f r u i t , e q u a l i z a t i o n w i t h f r e s h f r u i t r e t u r n s i s i n v a r i a b l y p r a c t i c e d . P o l i c i n g o f the R e g u l a t e d A r e a The B.C. Tree F r u i t Board under t h e A g r i c u l t u r a l P r o d u c t s M a r k e t i n g Act (Canada), and the N a t u r a l R r o d u c t s M a r k e t i n g ( B r i t i s h Columbia) A c t t h r o u g h t h e B.C. Tree F r u i t M a r k e t i n g Scheme i s g r a n t e d f u l l p o l i c i n g powers o f the a r e a under i t s c o n t r o l . The a r e a s of j u r i s d i c t i o n (Map 1) i s d e f i n e d by 121° W. l o n g i t u d e , 4 9 5 N and 5 l°N p a r a l l e l s o f l a t i t u d e and th e B r i t i s h C o l u m b i a - A l b e r t a boundary i n Canada. The topography o f the r e g i o n l e n d s i t s e l f to e f f e c t i v e p o l i c i n g . The r e l e v a n t s e c t i o n s r e l a t i n g t o t h e i n s p e c t i o n o f the r e g i o n a re c o n t a i n e d i n t h e 1964 B.C. F r u i t Board 55 R e g u l a t i o n s . A b r i e f summary of S e c t i o n 11(a) t o (e) and S e c t i o n 16 i s provided below. a. Every r e g i s t e r e d grower i s e n t i t l e d t o a t r e e l i c e n c e from the F r u i t Board t o s e l l f r u i t s grown on h i s orchard i n a s p e c i f i e d t r a d i n g area on f r u i t s t a n d s . However t r a n s p o r t a t i o n and s a l e of f r u i t i n between t r a d i n g areas i s f o r b i d d e n . b. A grower may s e l l f r u i t on h i s orchard without l i c e n c e ; so can a l i c e n c e d packing house on i t s premises. c. S a l e s of f r u i t are to be made on the spot. Example: no f r u i t s can be t r a n s p o r t e d f o r s a l e w i t h i n the t r a d i n g areas or o u t s i d e the designated board a r e a . d. Only d a i l y or s e a s o n a l l y l i m i t e d amounts can be s o l d per consumer. During 1963/1964, the maximum allowed was twenty standard packages of f r u i t , of which not more than f i v e were t o c o n s i s t of c h e r r i e s . e. The Board i s empowered to appoint f r u i t i n s p e c t o r s t o see t h a t the r e g u l a t i o n s of the Board are observed. The Board can moreover s e i z e and c o n f i s c a t e f r u i t moved i l l e g a l l y and prosecute v i o l a t o r s of the r e g u l a t i o n s The i n s p e c t o r s employed by the F r u i t Board p o l i c e the whole r e g u l a t e d area, u s u a l l y making spot checks t o B r i t i s h Columbia F r u i t Board, R e g u l a t i o n s Respecting the  Marketing of B r i t i s h Columbia Tree F r u i t s i n other  than I n t e r p r o v i n c i a l and Export Trade. C o n s o l i d a t e d to  1964. Kelowna. B.C.. 1964. R e g u l a t i o n s extending the powers t o i n t e r p r o v i n c i a l and export trade are contained i n the A g r i c u l t u r a l Products Marketing Act,B.C.Tree F r u i t Export R e g u l a t i o n s , 1963. REGULATED AREA Vancouver N c4>> U.S. A. M a p I. A r e a under jur isd ict ion of the B . C . Fru i t B o a r d . VJ1 ON 57 a s c e r t a i n two f a c t o r s : i . t h a t no r e g u l a t e d f r u i t i s being s o l d i l l e g a l l y . I n s p e c t o r s check t o see that f r u i t movements out of the r e g u l a t e d areas are accompanied by "manifests" i n d i c a t i n g t h a t they have passed throught the s o l e s e l l i n g agency, i i . t h a t consumers moving i n the r e g u l a t e d area do not c a r r y q u a n t i t i e s ' of r e g u l a t e d f r u i t i n excess o f the maximum allowed. The funds f o r o p e r a t i n g the Board's p o l i c i n g f u n c t i o n s are c o l l e c t e d from l i c e n c e s issued to s h i p p e r s , the extent o f which i s based upon the volume of f r u i t passing through them. Shippers and packing-houses having a volume of l e s s than 200,000 pounds a n n u a l l y pay s e v e n t y - f i v e d o l l a r s per y e a r . The l i c e n c e f e e s i n c r e a s e on a s l i d i n g s c a l e f o r g r e a t e r q u a n t i t i e s o f f r u i t r e c e i v e d by packing-houses from the growers. F r u i t which i s c o n f i s c a t e d by the Board can be e i t h e r s o l d or donated to any d e s e r v i n g i n s t i t u t i o n s . The Board a l s o e x e r c i s e s the d i s c r e t i o n of p r o s e c u t i n g v i o l a t o r s . CHAPTER V ANALYSIS OF THE PROCEDURES APPLIED BY B.C. TREE FRUITS LTD. TO MAXIMIZE REVENUES This chapter presents a comprehensive view of the powers vested i n B.C. Tree F r u i t s Ltd. Data pertaining to the 1963 crop of regulated f r u i t (apples, crab-apples, pears, plums, prunes, peaches, cherries and apricots) have been used. Three major problems are considered: a. Supply regulation (to the market). b. Production cont r o l . c. P r i c i n g and price d i f f e r e n t i a t i o n . Supply Regulation Syupply regulation is here defined as the a b i l i t y of the agency to control f r u i t shipments to a l l markets. Seasonal D i s t r i b u t i o n of F r u i t An investigation r e l a t i n g to the seasonal d i s t r i b u t i o n of f r u i t to a l l markets, f o r the 1963 crop i s f i r s t given i n order to c l a r i f y l a t e r points. Graphs indicating t h i s seasonal d i s t r i b u t i o n follow below. A l l figures r e f e r to fresh f r u i t sales only. Peak sales of 940,000 pounds of cherries were made i n the f i r s t quarter of the marketing season. The seasonal supply curve of cherries i s r e l a t i v e l y smooth and most probably r e f l e c t s actual production (less processing and 1 0 0 0 Dates of Shipment Graph 7 B.C. Tree Fruit Ltd. shipments to all markets and harvest period, all cherries , 1963 crop. 8 0 0 p July August Dates of. Shipment Graph 8. B.C. Tree Fruit shipments to all markets, period of harvesting and period of application of seasonal specific tar i f f ,al l apricots, 1963crop. canning quotas) s i n c e c h e r r i e s are h i g h l y p e r i s h a b l e and can only be s t o r e d f o r a short p e r i o d . The s a l e of a p r i c o t s t o a l l o u t l e t s can be c l o s e l y approximated w i t h a smooth curve, i n d i c a t i v e of a g r a d u a l l y i n c r e a s i n g and then d e c r e a s i n g supply t o the market. L i k e c h e r r i e s , the peak s a l e s volume was i n the f i r s t q u a r t e r of the season, w i t h the g r e a t e s t movement of a p r i c o t s t o the market o c c u r r i n g i n the f i r s t t h i r t y days of the p e r i o d . 32 While the s a l e s curve of prunes i s more e r r a t i c , i t r o u g h l y resembles a symmetrical curve, A smoother f l o w (compared w i t h c h e r r i e s and a p r i c o t s ) t o the market i s suggested by t h i s . Both peaches and plums have poly-peaked graphs, although the s a l e s curve of plums presents a more jagged o u t l i n e . , L i k e prunes, there was a more even spread of peaches and plums through the marketing season s i n c e the major part of the f r u i t s o l d accounted f o r a h i g h p r o p o r t i o n of the season. Except f o r plums, a l l the s o f t f r u i t s mentioned above have r e l a t i v e l y smooth s a l e s c u r v e s . T h i s i s e n t i r e l y u n l i k e the s a l e s curves of the t r e e f r u i t group which have market supply curves too e r r a t i c t o be approximated w i t h a symmetrical curve. T h i s f e a t u r e i s a t t r i b u t a b l e t o the s t o r e a b i l i t y of the t r e e f r u i t s as compared w i t h the s o f t f r u i t s . While there are onl y two peak p e r i o d s o f the c r a b -A c t u a l l y a s a l e s frequency polygon I 0 0 0 9 0 0 8 0 0 7 0 0 O 6 0 0 O O </> 5 0 0 4 0 0 3 0 0 2 0 0 100 0 "— 1575 prune supply period of application of seasonal specific tariff on apricots harvesting period-apricots 7 10 14 17 21 24 28 31 4 7 II 14 18 21 25 28 2 5 9 12 August September October Dates of Shipment Graph 9. B.C. Tree Fruits Ltd. shipments to all markets , period of harvesting and period of application of seasonal specific tariff,all prunes, 1963 crop. 63 July August September Dates of Shipment Graph 10. B.C.Tree Fruits Ltd. shipments to all markets, period of harvesting and period of application of seasonal specific tariff, all peaches, 1963 crop. 20 r 2 0 2 4 27 31 3 7 10 14 17 21 24 28 31 4 7 II 14 18 21 2 5 28 2 5 9 July August S e p t e m b e r October Dates of Shipment Graph II. B.C.Tree Fruits Ltd. shipments to al l markets , al l p l ums , 1963 crop. ON 2 0 0 1 5 0 O O O x 100 to 5 0 c rab-app le supply 7 10 f4 17 21 24 28 31 4 7 II 14 18 21 25 28 2 5 9 12 16 19 August September October Dates of Shipment Graph 12. B.C.Tree Fruits Ltd. shipments to all markets, al l c r a b -apples, 1963 crop. 2000 7 14 21 28 4 II 18 25 2 9 16 23 30 6 13 20 27 4 II 18 25 I 4 8 15 22 29 8 15 10 17 24 31 7 14 21 28 5 12 19 2 6 2 9 16 23 30 7 14 21 28 II 18 25 I Aug'63 Sep Oct Nov Dec Jan 64 Feb Dates of Shipment Graph 13. B.C. Tree Fruits Ltd. shipments to all markets, period of harvesting and period of application of seasonal specific tariff, all pears, 1963 crop. 1013 20 27 3 7 14 2 28 4 7 II 18 25 2 9 16 23 30 6 13 20 27 4 II 18 25 I 4 8 15 22 29 8 15 22 29 7 W 21 28 6 II 18 25 2 9 16 23 30 6 20 17 24 31 10 17 24 31 14 21 28 5 12 19 26 2 9 16 23 30 7 14 21 28 ' II 18 25 I Jul 63 Aug Sep Oct Nov Dec Jan'64 Feb Mar Apr May Jun Dates of Shipment Graph 14. B.C. Tree Fruits Ltd. shipments to all markets, period of harvesting and period of application of seasonal specific tariff, all apples, 1963 crop. apple annual s a l e s curve, those f o r apples and pears show many s a l e s peaks. The h i g h e s t s a l e s f o r apples were made i n the l a t t e r p art of the season with the lowest p o i n t s o c c u r r i n g i n the winter months. This i s i n c o n t r a s t w i t h s o f t f r u i t s a l e s , which because of p e r i s h a b i l i t y and the e a r l y h a r v e s t i n g d a t e s , were g e n e r a l l y c o n f i n e d to summer and the e a r l y winter p e r i o d . T a b l e IX compares the marketing season w i t h the h a r v e s t i n g p e r i o d of a l l f r u i t . A l l the t r e e f r u i t had l o n g e r marketing seasons than the s o f t f r u i t . T h i s was e s p e c i a l l y c h a r a c t e r i s t i c of apples and pears, the former approaching one calender y e a r . P r i o r t o i n v e s t i g a t i n g other aspects of supply r e g u l a t i o n , an a n a l y s i s of the r e l a t i v e , v a r i a t i o n s i n the q u a n t i t i e s of f r u i t s u p p l i e d to a l l markets i s g i v e n . For t h i s purpose, the c o e f f i c i e n t of v a r i a t i o n i s used i n order to e l i m i n a t e obvious d i f f e r e n c e s i n the supply of f r u i t s , e s p e c i a l l y between the t r e e f r u i t group and the s o f t f r u i t group. Table X i n c o r p o r a t e s the c o e f f i c i e n t s of v a r i a t i o n and a c t u a l average d a i l y shipments t o a l l markets. The l a r g e s t r e l a t i v e v a r i a t i o n i n supply i s shown by apples with a c o e f f i c i e n t of 992$. However the next two l a r g e s t c o e f f i c i e n t s are f o r the s a l e s of a p r i c o t s and c h e r r i e s , w i t h peach s a l e s e x h i b i t i n g the l e a s t r e l a t i v e v a r i a t i o n . Except f o r apples and peaches, a l l the f r u i t s d i d not have g r e a t d i f f e r e n c e s i n t h e f l u c t u a t i o n s o f supply t o the market. By w e i g h t , a p p l e s had the h i g h e s t average d a i l y shipments t o a l l the markets f o l l o w e d by peaches, pears and p r u n e s . The l o w e s t average d a i l y shipment was f o r plums w i t h o n l y 1820 pounds. S u p p l y R e g u l a t i o n Throughl.The Time F a c t o r An i n d i c a t i o n of s u p p l y c o n t r o l i s the excess of days o f t h e m a r k e t i n g s e a s o n o v e r the h a r v e s t i n g p e r i o d . The r e l e v a n t r a t i o s f o r t h e s e a r e c o n t a i n e d i n T a b l e IX. I t i s i n t e r e s t i n g t o observe t h a t a l l s o f t f r u i t , w i t h t h e e x c e p t i o n o f a p r i c o t s , have c o n s i s t e n t l y s m a l l e r r a t i o s t h a n the t r e e f r u i t s . These r a t i o s moreover approach one and are s u g g e s t i v e o f the reduced o p p o r t u n i t i e s f o r r e g u l a t e d s u p p l y t h r o u g h t i m e . A c l o s e r e x a m i n a t i o n of the a p r i c o t s a l e s curve w i l l r e v e a l t h a t i n r e a l i t y the m a r k e t i n g s e a s o n was s h o r t e r t h a n i s shown i n T a b l e IX s i n c e o n l y s m a l l q u a n t i t i e s were s h i p p e d at the end o f t h e season. Hence th e r a t i o f o r a p r i c o t s and s i m i l a r l y f o r c h e r r i e s i s c l o s e r t o one. S t o r a g e f a c i l i t i e s were used by the m a r k e t i n g agency t o a c h i e v e r e g u l a t e d s u p p l y t h r o u g h t i m e t o t h e market, t h e r e b y a t t e m p t i n g t o maximize r e t u r n s t o the growers. T h i s e x p l o i t a t i o n was l i m i t e d i n the case of the s o f t f r u i t s w h i c h are s u b j e c t t o q u i c k p h y s i c a l d e t e r i o r a t i o n . W h i l e B.C. Tree F r u i t s L t d . or Sun-Rype P r o d u c t s L t d . d i d not own a s i g n i f i c a n t volume of s t o r a g e c a p a c i t y , a l l TABLE IX LENGTH OF MARKETING AND HARVESTING SEASONS., ALL REGULATED FRUIT, I 9 6 3 CROP 70 S o f t F r u i t ( 1 ) ( 2 ) Length of Length of MarketIng** H a r v e s t i n g * R a t i o s Season(days) Season(days) ( l ) i ( 2 ) Prunes Plums Peaches A p r i c o t s C h e r r i e s 79 8 2 6 4 50 5 7 6 8 0 . 8 6 1 Not A v a i l a b l e 59 0 . 9 3 0 2 9 0 . 5 8 0 42 0 . 7 3 7 Tree F r u i t Pears Apples Crab-apples 2 2 1 340 83 7 4 1 1 6 0.335 0.341 Source t x H o r t i c u l t u r a l N e w s l e t t e r , B.C.Department of A g r i c u l t u r e , Kelowna, 1 9 6 3 • x x B.C. Tree F r u i t s L t d . , Records. 1 9 6 3 . TABLE X *. COEFFICIENTS, OF VARIATIONS- AND ACTUAL AVERAGE SHIPMENTS OF ALL REGULATED FRUIT,I963 CROP C o e f f i c i e n t o f D a i l y Average S o f t F r u i t V a r i a t i o n {%) Shipment(000 l b s ) J Prunes 98.5 96.20 Plums 93.0 1.82 Peaches 65.4 152.80 A p r i c o t s 138.0 54.00 C h e r r i e s 107.0 75.00 Tree F r u i t Pears 99.8 141.00 Apples 992.0 551.00 Crab-Apples 103.0 14.00 &ource: XB.C. Tree F r u i t s L t d . , Records. 1963. p a c k i n g houses had t h e i r own s t o r a g e f a c i l i t i e s . Some had c o n t r o l l e d atmosphere s t o r a g e . The whole f r u i t i n d u s t r y c o l l e c t i v e l y owned 380,160 s t a n d a r d boxes (46 pounds) of X c o n t r o l l e d atmoshphere s t o r a g e . I t i s u n f o r t u n a t e t h a t no r e c o r d s were kept o f the amount of f r u i t i n s t o r a g e by day. However f o r t u i t o u s r e c o r d s f o r Winesaps and Red D e l i c i o u s i n s t o r a g e were o b t a i n e d . T h i s i s compared w i t h the amounts of these f r u i t s s o l d a t s i m i l a r d a t e s and i l l u s t r a t e d i n the f i g u r e s below. W h i l e t h e s e f i g u r e s p l a i n l y i n d i c a t e the use o f s t o r a g e over t i m e f o r Winesaps and Red D e l i c i o u s , e v i d e n c e r e l a t i n g t o t h e h a r v e s t i n g and m a r k e t i n g seasons assume the u t i l i z a t i o n o f s t o r a g e f a c i l i t i e s f o r f r u i t s , e s p e c i a l l y the t r e e f r u i t s . S u p p l y R e g u l a t i o n Through the Form F a c t o r The c h a n n e l i n g of p a r t o f the o u t p u t of r e g u l a t e d f r u i t I n t o p r o c e s s i n g and c a n n i n g i s done too maximize revenues t h r o u g h the m a n i p u l a t i o n o f the f orm f a c t o r . Ho f i g u r e s were a v a i l a b l e f o r the d a i l y , s e a s o n a l o r s p a t i a l d i v e r s i o n o f f r u i t s i n t o t h e c a n n i n g and p r o c e s s i n g m a rket. B e f o r e the b e g i n n i n g o f e v e r y f r u i t s e a s o n , B.G. Tree F r u i t s L t d * a l l o c a t e s t h e quotas f o r p r o c e s s e d and canned f r u i t t o each p r o c e s s o r and canner r e g i s t e r e d w i t h i t . Only Sun-Rype P r o d u c t s L t d . - t h e grower-owned p r o c e s s i n g company - i s p e r m i t t e d t o p r o c e s s a p p l e s i n t o a p p l e j u i c e . 14 000 12 000 10 000 O O 8 000 6 000 4000 2000 UT1 qty. in storage H qty. marketed Mar. 21 Apr. II Apr. 18 Apr. 25 May 2 May 9 May 16 May 23 May 20 Fig. 2. Quantities of winesaps in storage, shipping and packing houses, Okanagan Valley, compared to B.C. Tree Fruit Ltd. sa les, March to May 1964. 1700 1600 700 600 rvrs^, o O 500 O J3 400 300 200 100 [Ul qty. in storage H qty. marketed Mar. 21 Apr. II Apr. 19 Apr.25 May 2 May 9 May 16 Fig. 3. Quantity of red delicious in storage, shipping and packing houses, Okanagan Valley, compared with B.C. Tree Fruit Ltd. sales, March to May 1964. I t thus c o n t r o l s the apple j u i c e market. In 1963, Sun-Rype Products L t d . was g i v e n 70 percent of the t o t a l quota of a l l f r u i t s d i v e r t e d i n t o p r o c e s s i n g and canning. Of the t o t a l output o f the r e g u l a t e d crop f o r 1963, 37.3 percent was d i v e r t e d i n t o the canning and processing market. Approximately 50 percent of the peaches were e i t h e r processed or canned - t h i s was the h i g h e s t percentage among a l l the f r u i t . Plums c o n t r i b u t e d the lowest percentage (7.4-5$) f o r p r o c e s s i n g and canning. S,upply R e g u l a t i o n Through the Space F a c t o r The d i v e r s i o n of f r u i t t o d i f f e r e n t consuming areas r e p r e s e n t s an important aspect of supply r e g u l a t i o n . Thus an a n a l y s i s based on Appendix I I I showing the s p a t i a l d i s t r i b u t i o n of f r e s h f r u i t (except f o r apples where f i g u r e s f o r both f r e s h and processed and canned f r u i t are c o n s o l i d a t e d ) i s made. The a n a l y s i s i s done through a. R e g i o n a l consumption of a l l f r u i t . b. T o t a l market S a l e s by type of f r u i t . c. Aggregate market s a l e s f o r a l l f r u i t s . F or the Western Canadian market (the a r e a between B r i t i s h Columbia and Western O n t a r i o ) , Winnipeg consumed the l a r g e s t percentages of pears and c h e r r i e s . The l a r g e s t c r a b -a p p l e , prune and plum s a l e s were made i n Edmonton while C a l -gary and Vancouver were the major o u t l e t s f o r peaches and a p r i c o t s . For f r e s h and processed a p p l e s , Vancouver was the l a r g e s t s i n g l e market. 7 6 For a l l f r u i t t a ken i n t o t a l , f o r Western Canada, Vancouver was the l a r g e s t o u t l e t consuming 2 1 . 4 percent, f o l l o w e d c l o s e l y by Winnipeg ( 2 0 . 4 p e r c e n t ) . The E a s t e r n Canadian market covers E a s t e r n O n t a r i o , Quebec, New Brunswick, Newfoundland, Nova S c o t i a and P r i n c e Edward I s l a n d . The two major markets were Toronto and M o n t r e a l which together accounted f o r n e a r l y 8 0 percent of the s a l e s of a l l r e g u l a t e d f r u i t i n E a s t e r n Canada. The U n i t e d States market i n aggregate absorbed 24 percent of f r e s h and processed a p p l e s , 24 percent of pears and 4 percent of a l l c h e r r i e s s o l d by B.C.Tree F r u i t s L t d . No s a l e s of the other f r u i t were made. In the o f f - s h o r e markets ( a l l narkets except Canada and the U n i t e d S t a t e s ) , the major consuming areas were the U n i t e d Kingdom and S c a n d i n a v i a . The former accounted f o r 6 4 . 2 percent of the s a l e s of a l l the f r u i t s i n the o f f - s h o r e markets. An a n a l y s i s of the t o t a l market s a l e s by type of f r u i t r e v e a l s that apples and pears were evenly d i s t r i b u t e d to a l l r e g i o n s . Western Canada accounted f o r the h i g h e s t percentage of a l l apples ( 4 3 p e r c e n t ) , pears ( 4 4 p e r c e n t ) , crab-apples ( 9 6 p e r c e n t ) , prunes ( 9 9 p e r c e n t ) , plums ( 1 0 0 p e r c e n t ) , peaches ( 9 9 p e r c e n t ) , a p r i c o t s ( 9 2 percent) and c h e r r i e s ( 7 3 p e r c e n t ) . Apples and pears were the two most important f r u i t ^ f o r the i n t e r n a t i o n a l markets. '77 An a n a l y s i s of the r e g i o n a l d i s t r i b u t i o n of a l l f r u i t s t o the r e g i o n a l markets shows that Western Canada consumed 47.7 percent of the aggregate s a l e s made by B.C. Tree F r u i t s L t d . The U n i t e d S t a t e s accounted f o r 22.1 percent f o l l o w e d by the o f f - s h o r e markets (19.1 percent) and E a s t e r n Canada ( e l e v e n p e r c e n t ) . The U n i t e d Kingdom market alone, however, consumed 1.2 percent more of the s a l e s of a l l f r u i t t h a n E a s t e r n Canada. Canada as a whole absorbed 58.8 percent of a l l f r u i t s o l d f o l l o w e d by the U n i t e d S t a t e s and the U n i t e d Kingdom. P r o d u c t i o n C o n t r o l The i n t e n t i o n of t h i s s e c t i o n was t o i n v e s t i g a t e whether any forms of p r o d u c t i o n c o n t r o l e x i s t e d over f r u i t s i n the Okanagan V a l l e y by the B.C. F r u i t Board. There were no r e g u l a t i o n s r e g a r d i n g the c o n t r o l of the Board over p r o d u c t i o n i n r e l a t i o n t o : a. Phased p l a n t i n g t o a l l o w f o r d i f f e r e n t h a r v e s t i n g p e r i o d s . b. R e - l o c a t i o n of f r u i t orchards t o areas conducive t o more p r o f i t a b l e growth c. The i n t r o d u c t i o n of new v a r i e t i e s of f r u i t and the disappearance of o t h e r s . The B r i t i s h Columbia F r u i t Growers' A s s o c i a t i o n and B.C. Tree F r u i t s L t d . with h o r t i c u l t u r i s t s and pomologists are members of the A g r i c u l t u r a l Club whose o b j e c t i v e i s to p r o v i d e a d v i c e and recommendations p e r t a i n i n g t o t h e t h r e e a s p e c t s o u t l i n e d above. S>uch recommendations are c o n t a i n e d i n the Q u a r t e r l y R e p o r t of the B.C. F r u i t Growers' A s s o c i a t i o n . The r e l e v a n t s e c t i o n s o f the recommendations f o r 1963 and 1964 a r e c o n t a i n e d i n Appendix IV. Most o f the recommendations are based upon B.C. Tree F r u i t s L t d . ' s market p r o s p e c t s o f r e g u l a t e d f r u i t , t he p r o d u c t i o n p o t e n t i a l o f competing a r e a s and s u p p l i e s on hand i n the v a r i o u s a r e a s . I t does appear as i f the major p a r t o f t h e recommendations o f the A g r i c u l t u r a l C l u b concerned new p l a n t i n g or e l i m i n a t i o n o f some v a r i e t y o f f r u i t . The Department of A g r i c u l t u r e a d v i s e s e x t e n s i v e l y , e s p e c i a l l y i n r e g a r d t o t h e b e s t p l a n t i n g d a t e s . One would expect t h a t over the y e a r s growers have r e c o g n i z e d the worth of the recommendations o f e x p e r t s , and hence would be f o l l o w e d . The 1964 Q u a r t e r l y Report observes t h a t where peaches are co n c e r n e d , growers have r e a c t e d p o s i t i v e l y t o s u g g e s t i o n s f o r p l a n t i n g o f e a r l i e r v a r i e t i e s , t h e e l i m i n a t i o n o f peach growing i n t h e l a t e m a t u r i n g d i s t r i c t s and t h e e l i m i n a t i o n o f E l b e r t a s a r i s i n g f r o m poor demand. The v a l u e o f the recommendations o f the A g r i c u l t u r a l C l u b l i e l a r g e l y i n t h e i r s h o r t - t e r m f o r e c a s t s . The complete e l i m i n a t i o n of some v a r i e t i e s o f f r u i t s has been due l a r g e l y t o the adverse r e s u l t s o f market r e j e c t i o n o f unwanted grades and v a r i e t i e s of f r u i t . In t h i s r e s p e c t , the A g r i c u l t u r a l Club through B.C. Tree F r u i t s Ltd.. serves as a d e t e c t o r of such r e a c t i o n s and t r a n s m i t s them t o the growers. P r i c i n g and P r i c e D i f f e r e n t i a t i o n Three major aspects comprise t h i s s e c t i o n , i . F a c t o r s a f f e c t i n g the p r i c i n g p o l i c y of B.C. Tree F r u i t s L t d . i i . D i f f e r e n t i a t e d p r i c i n g procedures and a r e g i o n a l demand a n a l y s i s f o r apples consumed i n Western Canada and E a s t e r n Canada, i i i V a r i a t i o n s i n p r i c e of f r u i t s o l d . P r i c i n g P o l i c y •3-3 As enumerated by the McPhee Report J e l e v e n f a c t o r s i n f l u e n c e the p r i c i n g p o l i c y of B.C. Tree F r u i t s L t d . f o r i t s p r o d u c t s . The e i g h t most important a r e : a. The volume of the crop i n B r i t i s h Columbia compared w i t h f r u i t p r o d u c t i o n i n competing areas (Washington, Oregon, C a l i f o r n i a , I t a l y , U n i t e d Kingdom, E a s t e r n Canada) a f f e c t s the l e v e l of p r i c e of f r u i t set by B.C. Tree F r u i t s L t d . Thus i f B r i t i s h Columbia and other competing areas have heavy crops, p r i c e s would be depressed f o r B r i t i s h Columbia f r u i t . B r i t i s h Columbia, Royal Commission of the Tree F r u i t I ndustry of B r i t i s h Columbia, Report, V i c t o r i a , B.C Queen's P r i n t e r , 1958, pp. 552 - 554-. b. The q u a l i t y , grade and s i z e o f the B r i t i s h Columbia crop compared wi t h the eye-appeal o f f r u i t from competing a r e a s . c. The h a r v e s t i n g dates o f the B r i t i s h Columbia crop compared w i t h the crops o f compiling areas has a s i g n i f i c a n t i n f l u e n c e on B.C. Tree F r u i t s L t d . p r i c e p o l i c y . E a r l y crops command a premium p r i c e not shared by l a t e r f r u i t , The B r i t i s h Columbia crop normally matures at a l a t e r date than Washington, Oregon or C a l i f o r n i a , but at the same time as O n t a r i o . d. Competitive p r i c e s of f r u i t i n competing a r e a s . e. The value of f r u i t imports i n t o Canada. f . The a v a i l a b i l i t y and c a p a c i t y o f p r o c e s s i n g and canning o u t l e t s a l s o a f f e c t s f r e s h f r u i t p r i c e s . I f a s m a l l demand e x i s t s f o r p r o c e s s i n g and canning when the harvest i s heavy, p r i c e s w i l l have t o be lowered t o f a c i l i t a t e movement t o the market. g. The e f f e c t of r e t a i l s e l l i n g p r i c e s i s r e f l e c t e d i n the p r i c e l e v e l set by the agency, which has t o acknowledge the f a c t t h a t consumers are s u s c e p t i b l e t o a t t r a c t i v e s e l l i n g p r i c e s . h. The f e e l of the market - the s a l e s department of B.C.Tree F r u i t s L t d . has to c o n s t a n t l y keep a f i n g e r on the pulse of the f r e s h f r u i t market i n major t r a d i n g areas and adjust i t s p r i c e s a c c o r d i n g l y . D i f f e r e n t i a t e d P r i c i n g D i f f e r e n t i a t e d p r i c i n g i s a s a l e s procedure w i d e l y used by many business e n t e r p r i s e s . B.C. Tree F r u i t s L t d . g e n e r a l l y a p p l i e s t h i s and the a s s o c i a t e d f a c t o r of f r e i g h t 34 a b s o r p t i o n i n order t o o b t a i n maximum net revenues i n each r e g i o n a l market by charging a d i f f e r e n t p r i c e i n one time p e r i o d f o r homogeneous grades of f r u i t . C o n s i s t e n t evidence of d i s c r i m i n a t o r y p r i c i n g i n one market r e l a t i v e t o other markets was d i f f i c u l t t o l o c a t e . T h i s may be due to the f a c t t h a t too many v a r i a b l e and changing f a c t o r s have t o be taken i n t o c o n s i d e r a t i o n b e f o r e a p r i c e can be quoted. Evidence o f the p r a c t i c e of d i f f e r e n t i a t e d p r i c i n g by the agency was obtained from the p r i c e l i s t s of r e g u l a t e d f r u i t , the annual net revenues from the s a l e of r e g u l a t e d f r u i t i n d i f f e r e n t markets and cherry consignment s e l l i n g r e c o r d s . The p r i c e l i s t s used f o r r e g u l a t e d f r u i t were f o r the Canadian market o n l y . P r i c e s f o r a number of days i n the marketing season were picked f o r a l l f r e s h f r u i t s . The i n d i c a t i o n s of a d i f f e r e n t i a t e d p r i c i n g p o l i c y which were looked f o r were: i . The p r i c e s of homogeneous f r u i t i n the B r i t i s h 34-For n a t i o n a l l y a d v e r t i s e d products, the same d e l i v e r e d p r i c e i s quoted f o r a l l markets. Hence i n some a r e a s , d e l i v e r e d p r i c e s may not r e f l e c t the a c t u a l f r e i g h t costs i n v o l v e d . Where the t r a n s p o r t a t i o n d i f f e r e n t i a l i s l e s s than i t should be, the s e l l e r "absorbs" the f r e i g h t c o s t . 82 Columbia and other markets compared on an equal b a s i s (e.g., f.o.b. Kelowna). i i . The extent of grade d i f f e r e n t i a l s f o r f r u i t between markets. i i i . The extent and v a r i a t i o n of p r i c e d i f f e r e n t i a l s between markets. The s i g n i f i c a n t p o i n t s d e r i v e d from an examination of the p r i c e l i s t s (Appendix IV) f o l l o w below: a. The p r i c e d i f f e r e n t i a l s between the two markets (Western Canada and B r i t i s h Columbia) f o r c h e r r i e s and the grade d i f f e r e n t i a l s remained c o n s t a n t . b. The p r i c e d i f f e r e n t i a l between markets f o r a p r i c o t s was a constant t h i r t y c e n t s . c. P r i c e d i f f e r e n t i a l s were s i m i l a r l y constant f o r plums. d. The d e l i v e r e d p r i c e s of prunes t o Saskatchewan and Manitoba and Western O n t a r i o were the same and i l l u s t r a t e p r i c e d i s c r i m i n a t i o n a g a i n s t prune consumers i n the Saskatchewan market. T h i s may be due to the e l a s t i c market f o r prunes i n Manitoba and Western O n t a r i o , where s u b s t i t u t e f r u i t from competing areas could be o b t a i n e d . e. While p r i c e and grade d i f f e r e n t i a l s remained constant; between markets, d i s c r i m i n a t o r y p r i c i n g o f the type mentioned above can be n o t i c e d f o r f r e s h peaches. From f.o.b. p r i c e s of Vees, J u b i l e e s , Hales, Rochesters, S p o t l i g h t and D e l i c i o u s , Hales and Candokas f o r the t h r e e p r i c e l i s t s g i v e n , d i s c r i m i n a t o r y p r i c i n g a g a i n s t the Kelowna or Vancouver markets can be s a i d t o have been i n e f f e c t . While the net r e t u r n s t o B.C. Tree F r u i t s L t d . of peach v a r i e t i e s such as Rochesters, S p o t l i g h t and D e l i c i o u s on August 14 were $1.50 and $1.35 f o r No.l and No. 2 i n Kelowna, they only r e a l i z e d $1.45 and $1.30 from the Peace R i v e r a r e a market. D i f f e r e n t i a l net revenues from the home market and one f u r t h e r away are evidence of p r i c e d i s c r i m i n -a t i o n . f . S i m i l a r examples e x i s t f o r crab-apples f o r the B r i t i s h Columbia and Peace R i v e r markets. V a r y i n g grade d i f f e r e n t i a l s between markets a l s o i n d i c a t e p r i c e d i s c r i m i n a t i o n . The d i f f e r e n t i a l between J u n i o r Fancy and Standard Box Cee was f i f t y cents i n B r i t i s h Columbia, f o r t y - f i v e cents i n the Peace R i v e r area, seventy cents i n A l b e r t a , e i g h t y cents i n Saskatchewan and e i g h t y -f i v e cents i n Manitoba and Western O n t a r i o . Thus B.C. Tree F r u i t s L t d . obtained more by the s e l l i n g of a Standard Box Cee and a J u n i o r Box Cee i n B r i t i s h Columbia than i n any other market to the east of i t . However one can s t a t e that c o m p e t i t i v e p r i c i n g was •f being p r a c t i s e d i n A l b e r t a , Saskatchewan and Western O n t a r i o , where d e l i v e r e d p r i c e s i n c r e a s e d p r o g r e s s i v e l y the f u r t h e r / away from Kelowna crab-apples were s o l d . g. For f r e s h pears, p r i c e d i s c r i m i n a t i o n between B r i t i s h Columbia and the Peace R i v e r markets, Saskatchewan and Manitoba and Western O n t a r i o i s e v i d e n t . 84 h. There was p r i c e d i s c r i m i n a t i o n between the Peace R i v e r B r i t i s h Columbia f o r f r e s h apples s o l d and between the A l b e r t a and Saskatchewan markets. D i s -c r i m i n a t i o n was p r a c t i c e d a l s o a g a i n s t A l b e r t a and Saskatchewan consumers of apples s i n c e the p r i c e s of Mcintosh and Spartans a c t u a l l y were lower i n Manitoba and Western O n t a r i o than i n A l b e r t a and Saskatchewan. As i n the case f o r crab-apples above, p r i c e d i s c r i m i n a t i o n through v a r y i n g grade d i f f e r e n t i a l s e x i s t e d f o r S p artans, Fancy C e l l 84s-140s and Cee C e l l 84s - l 6 0 s f o r E a s t e r n Canada and B r i t i s h Columbia. An e x c e p t i o n t o the p o l i c y of d i f f e r e n t i a t e d p r i c i n g i s noted f o r Golden D e l i c i o u s , E x t r a Fancy C e l l 96s-140s, where the f.o.b. p r i c e t o E a s t e r n Canada was $4.50 while i n B r i t i s h Columbia i t was only $4.10. The annual net r e t u r n s ( i e . , f.o.b. p r i c e s ) f o r d i f f e r e n t v a r i e t i e s and grades of f r u i t d i s t r i b u t e d s p a t i a l l y a l s o shows evidence of p r i c e d i s c r i m i n a t i o n . Data (summarized i n Table Xl)were s e l e c t e d t o give the widest s p a t i a l r e p r e s e n t a t i o n of f r u i t p o s s i b l e . For Winesaps, E x t r a Fancy Medium, Winesaps Fancy Tray W Medium, Red D e l i c i o u s E x t r a Fancy C e l l Medium, Red D e l i c i o u s Fancy C e l l Medium, Red D e l i c i o u s Fancy Tray II Medium, Mcintosh E x t r a Fancy C e l l Medium, Mcintosh Tray C e l l Medium and D'Anjou E x t r a Fancy Standard Box Medium, the c l a s s i c ease of d i s c r i m i n a t o r y p r i c i n g where the home market (here Western Canada) earns the h i g h e s t r e t u r n s i n comparison t o other more d i s t a n t markets i s e v i d e n t . In the case of Winesaps, E x t r a Fancy Tray W Large and Winesaps, E x t r a Fancy Tray W Smal l , the E a s t e r n Canadian Market earned more net r e t u r n s t han the home market, while f o r D'Anjou, Fancy Standard pi.Medium, the P a c i f i c and the E a s t . A s i a markets accrued the most revenue. T h i s shows that although i t i s g e n e r a l l y acceptable t o say that the home market earned h i g h e r net r e t u r n s i t i s not n e c e s s a r i l y t r u e that the most d i s t a n t export market earned the l e a s t . S i n c e d i f f e r e n t net r e t u r n s were obtained f o r i d e n t i c a l f r u i t s o l d , d i s c r i m i n a t o r y p r i c i n g e x i s t e d i n s o f a r as the c e n t r a l s e l l i n g agency a d j u s t s the p r i c e s to meet the demand c o n d i t i o n s i n each p a r t i c u l a r market. Table X I I i l l u s t r a t e s the use of another method of p r i c e d i f f e r e n t i a t i o n : namely, 'consignment s e l l i n g t o other areas when the u s u a l markets are s a t u r a t e d . Consignment s e l l i n g i s used t o provide as wide a s p a t i a l d i s t r i b u t i o n of f r u i t as p o s s i b l e . The p r i c i n g f u n c t i o n i n consignment s e l l i n g d i d not l i e with B.C.Tree F r u i t s L t d . but was l e f t t o buyers i n the f r u i t a u c t i o n . The s a l e of the 1964 cherry crop r e f l e c t s consignment s e l l i n g to the U n i t e d Kingdom f r e s h cherry market. The average naked f r u i t r e t u r n s f i g u r e was the amount pa i d by the s e l l i n g agency t o the packing and s h i p p i n g houses f o r d i s t r i b u t i o n ( a f t e r d e d u c t i o n of c o s t s ) t o growers. Of the s i x days when c h e r r i e s were consigned t o the TABLE XI AVERAGE NET RETURNS?"PER UNIT VOLUME FOR SELECTED GRADES. AND VARIETIES, OF FRUIT, 1963 CROP SEASON South and P a c i f i c D e s t i n a t i o n : Western E a s t e r n Canada Canada U n i t e d S t a t e s U n i t e d Kingdom S c a n d i n a v i a C e n t r a l and Europe America And S o u t h E a s t A s i a C a r i b bean Grade and V a r i e t y Average Net ; R e t u r n s / p e r u u n i t volume ($) Winesaps,Extra Fancy Tray W,Large 3.50 3.57 3.05 - - - - 2.15 Winesaps,Extra Fancy Tray W,Medium 3.77 3.76 3.20 3.13 2.94 - 3.19 2.74 Winesaps,Extra Fancy Tray W,Small 3.37 3.72 2.94 2.82 2.90 2.60 - -Winesaps,Fancy Tray W, Medium 3.05 2.83 2.72 2.82 2.98 2.92 - 2.59 Red D e l i c i o u s E x t r a Fancy C e l l , Medium 3.78 3.59 3.15 3.19 3.31 3.78 Red D e l i c i o u s , Fancy C e l l , Medium 3.28 2.80 2.70 2.99 2.88 - 2.66 3.22 Red D e l i c i o u s Fancy Tray U,Medium 3.30 2.79 2.70 3.02 2.94 2.80 2.95 3.01 Mcintosh, E x t r a Fancy C e l l , Medium 3.83 3.25 3.12 2.64 - - 3.53 3.24 Mcintosh, Fancy C e l l , Medium 3.22 2.90 2.77 2.32 2.49 3.04 2.78 2.83 D'Anjou, Fancy Standard Pl.,Medium 5.67 4.69 4.40 4.42 4.09 4.40 — 3.83 D'Anjou, Standard pl„, Med ium 4.68 4.62 4.05 4.19 4.15 _ 4.86 xAmount pa i d by agency t o s h i p p e r s and p a c k e r s . Sources B.C.Tree F r u i t s L t d . . Records. 196^. TABLE X I I COMPARISON OF AVERAGE NAKED FRESH FRUIT RETURNS, ALL MARKETS, GROUP 1 NO.l CHERRIES, 1964 Average Naked F r u i t R e t u r n ( $ / l b ) D e s t i n -a t i o n : Date o f S a l e E a s t e r n U n i t e d U n i t e d Canada Canada S t a t e s Kingdom Average A l l M a r k ets June 24 .28097 2 5 .28097 26 .28097 2 7 .28043 29 .24704 3 0 .23851 J u l y 1 .24940 2 .24595 3 .23292 4 .23283 .16661 5 .24105 6 .22839 .18828 7 .237H .20099 8 .23833 .18000 9 . 2 3 3 2 9 .18000 10 . 2 2 7 2 1 .18119 11 .21553 .18000 .15822 13 .20453 .19067 14 .19544 .18000 .19036 1 5 .18605 .18267 .26537 16 .18168 .18050 .18927 17 . 1 7 5 7 1 .18000 .19887 18 .17525 .18000 .11768 19 .16683 .17607 20 . 1 7 2 1 7 21 .17701 .18000 .15147 22 .16782 .18000 .15369 23 .17238 .18000 .14433 24 .17268 .18000 . 1 0 7 1 7 2 5 .17567 .18000 .09957 26 .15796 2 7 .17110 .09540 28 .15269 .18000 .20439 29 .12542 .18000 .15232 .28097 .28097 .28097 .28043 .24704 .23851 .24940 .24595 .23292 .21989 .24105 .22839 .20964 .22529 .21287 .25888 .20437 .20594 .20051 .14381 .17879 .17688 .18112 .18200 .13837 .17557 .13390 .15445 .16683 . .17367 .16887 .10945 .13758 .11606 .15240 .15330 .14510 .15796 .12026 .17175 .16990 TABLE X I I Cont'd.... D e s t i n -a t i o n s Date o f S a l e Canada E a s t e r n Canada U n i t e d S t a t e s U n i t e d Kingdom Average A l l Markets J u l y 3 0 . 1 6 1 9 3 . 1 7 9 7 9 3 1 U69.26 .18000 Aug. 1 . 1 1 1 7 1 . 1 8 1 7 9 3 . 1 2 0 5 2 4 . 1 6 6 0 6 .18000 ' 5 . 1 7 7 9 9 6 . 1 7 0 8 3 7 . 1 7 1 2 2 8 .09042 9 .20049 10 .18341 11 .12349 1 3 .I6683 1 7 .06146 O v e r a l l Averages 0.19786 0.18041 .17722 .15305 .16334 .12133 .14823 .12052 .16891 .17799 .17083 .17122 .09042 .20049 .18341 .12349 .16683 .06146 0.15035 0.13963 0.17581 S o u r c e s A n a l y s i s o f D a i l y Shipments, 1963 C h e r r y Group 1 N o . l Crop, B.C. Tree F r u i t s L t d . , 1964. Of the s i x days when c h e r r i e s weis consigned to the Un i t e d Kingdom market, only on one were average net r e t u r n s a c t u a l l y i n excess o f those r e c e i v e d i n the Western Canadian market. For the r e s t of the p e r i o d , the average net r e t u r n s were l e s s than the corresponding amount f o r the Western Canadian market by 0.00917 t o 0.05677 d o l l a r s per pound o f c h e r r i e s s o l d . A l s o , except f o r the s a l e made on J u l y 10th, the U n i t e d Kingdom average naked f r u i t r e t u r n was c o n s i s t e n t l y l e s s than the corresponding amount f o r Western Canada, E a s t e r n Canada and the Uni t e d S t a t e s . Of the twen t y - f i v e day p e r i o d o f d i s t r i b u t i o n t o more than one market, only on f o u r days d i d the Western Canadian market e a r n l e s s than the average naked f r u i t r e t u r n f o r a l l markets. S i m i l a r l y f o r the United S t a t e s , the average naked f r u i t r e t u r n s were g r e a t e r than f o r Western Canada only f o r f i v e days out of twenty days of s a l e s . T h i s i s i n d i c a t i v e of the p o l i c y of e x t r a c t i n g the g r e a t e s t r e t u r n s from the home market. However, t h i r t e e n days of the twenty-one day p e r i o d of s a l e s i n E a s t e r n Canada r e s u l t e d i n r e t u r n s h i g h e r than those i n the home market. T h i s a g a i n shows that the h y p o t h e s i s that p r i c e s i n E a s t e r n Canada are always lower than those i n Western Canada has e x c e p t i o n s . F i n a l l y , the o v e r a l l averages f o r i n d i v i d u a l markets i n d i c a t e t hat the hi g h e s t net r e t u r n per u n i t volume accrued to the Western Canadian market, the l e a s t i n the f a r t h e s t 90 market, U n i t e d Kingdom. A g e n e r a l c o n c l u s i o n r e g a r d i n g p r i c e d i f f e r e n t i a t i o n by the marketing agency would be that although p r i c e d i f f e r e n t i a t i o n was p r a c t i s e d there were exceptions t o t h i s r u l e . R e g i o n a l Demand A n a l y s i s f o r Apples It has been assumed so f a r that the demand curves f o r f r u i t i n Western and E a s t e r n Canada have d i f f e r e n t p r i c e e l a s t -i c i t i e s and t h i s allows f o r a d i s c r i m i n a t o r y p r i c i n g p o l i c y to be p r a c t i s e d by B.C.Tree F r u i t s L t d . Furtheremore, the R o y a l Commission on the B r i t i s h Columbia Tree F r u i t Industry and the Royal Commission on the P r i c e Spreads f o r Food Products have impli e d t h a t the demand curves that are r e l e v a n t f o r the agency are those f o r f r u i t s s u p p l i e d from a l l p r o d u c t i o n p o i n t s . A r e g i o n a l demand a n a l y s i s f o r apples was t h e r e f o r e attempted to i n v e s t i g a t e whether* a. The demand curve f o r apples i s more e l a s t i c i n Western Canada than i n E a s t e r n Canada. b. The demand curves r e l e v a n t f o r a d i s c r i m i n a t o r y p r i c i n g p o l i c y r e l a t e to aggregate consumption of a l l apples or only f o r the Okanagan product. To do t h i s , demand e s t i m a t i n g equations of the Cobb-Douglas and l i n e a r m u l t i p l e r e g r e s s i o n types were d e r i v e d . The dependent v a r i a b l e used was per c a p i t a consumption of apples while the independent v a r i a b l e s were per c a p i t a d i s p o s a b l e income and wholesale apple p r i c e s . The g e n e r a l forms of the equations d e r i v e d were Cobb-Douglas: X x = k P p X-(three v a r i a b l e s ) d $ Cobb-Douglas: X. = k P X (two v a r i a b l e s ) x 2 3 L i n e a r M u l t i p l e R e g r e s s i o n : X^ - k + bP^ + cX^ where X^ = per c a p i t a consumption P s wholesale p r i c e = per c a p i t a d i s p o s a b l e income k s constant b = p r i c e e l a s t i c i t y of demand c = income e l a s t i c i t y of demand There are three important l i m i t a t i o n s i n t h i s a n a l y s i s one, i t i s assumed that only per c a p i t a d i s p o s a b l e income and p r i c e a f f e c t the q u a n t i t y of apples demanded; two, the Cobb-Douglas e q u a t i o n g i v e s a constant e l a s t i c i t y f o r the p e r i o d consider ed; and f i n a l l y , the t i m e - s e r i e s c o n t a i n s data f a r f o r only t e n y e a r s . To d e r i v e the equations, t i m e - s e r i e s d a t a from 1954 to 1963 were used; (these are summarized i n Appendix V I ) . Es t i m a t e s of a l l apples and locaj^ apples consumed w i t h i n Western Canada, E a s t e r n Canada, Vancouver and Toronto were c o n s i d e r e d . To determine the per c a p i t a consumption of a l l apples i n Western Canada, the r a t i o s of B.C. Tree F r u i t L t d . s a l e s of apples to a l l other apple s a l e s i n Canada f o r 1954—1963 were obtained from the Crop and Seasonal Summaries publ i s h e d by the Canada Department of A g r i c u l t u r e . Using the a c t u a l shipments by the agency f o r t h i s p e r i o d , estimates of Western Canadian consumption of a l l f r e s h apples were a r r i v e d a t . Per c a p i t a f i g u r e s were t h e n c a l c u l a t e d . The aggregate consumption of a l l apples i n E a s t e r n Canada was obtained by s u b t r a c t i n g the Western Canadian consumption from the t o t a l q u a n t i t y of apples a v a i l a b l e f o r domestic consumption i n Canada. Estimates of the consumption of Okanagan apples i n Western Canada, E a s t e r n Canada, Vancouver and Toronto were s u p p l i e d by the agency. Wholesale p r i c e s of a l l apples were used s i n c e r e t a i l p r i c e s were not a v a i l a b l e . Seasonal averages f o r s i x major markets i n E a s t e r n and Western Canada f o r the t e n year p e r i o d were obtained from the Crop and Seasonal Summaries. T h i s was a l s o the source of the wholesale p r i c e s f o r B.C. Tree F r u i t L t d . shipments. A l l p r i c e s were deflated w i t h the Wholesale P r i c e Index f o r Canada (1949=100). Estimates of per c a p i t a disposable income were taken from the Canada Year Books. Two estimates of t h i s f i g u r e were used: one, per c a p i t a d i s p o s a b l e income ( p e r s o n a l income net of a l l taxes),.and two, net per c a p i t a d i s p o s a b l e income ( p e r s o n a l income net of taxes and s a v i n g s ) . T h i s was done t o determine what e f f e c t s the two estimates would have on the demand e l a s t i c i t y . For Western and E a s t e r n Canada, the estimates were d e f l a t e d w i t h the Canada Consumer P r i c e Index (1949=100), while f o r Vancouver and Toronto the r e s p e c t i v e M e t r o p o l i t a n Consumer P r i c e Indices were used. Table X I I I gives the type of e s t i m a t i n g e q u a t i o n used and the l e v e l s of s i g n i f i c a n c e at which t o accept the c o e f f i c i e n t s of m u l t i p l e d e t e r m i n a t i o n and r e g r e s s i o n . The r e s u l t s of the r e g i o n a l demand a n a l y s i s f o r apples a r e : a. The Cobb-Douglas e s t i m a t i n g e q u a t i o n seems to gi v e b e t t e r f i t to the d a t a than the eq u a t i o n d e r i v e d from the l i n e a r m u l t i p l e r e g r e s s i o n . However, f o r Vancouver the p r i c e and income e l a s t i c i t i e s of demand from the l i n e a r m u l t i p l e r e g r e s s i o n e q u a t i o n are acceptable at the 5 percent l e v e l of s i g n i f i c a n c e compared with the 10 percent l e v e l of s i g n i f i c a n c e f o r the Cobb-Douglas f u n c t i o n . b. The e s t i m a t i n g equations f o r l o c a l apples d i d not show any s i g n i f i c a n t p r i c e and income e l a s t i c i t i e s of demand. One could say, t h e r e f o r e , f o r the d a t a i n v e s t i g a t e d , that the demand f o r a l l apples consumed i s the one r e l e v a n t f o r the agency's market o p e r a t i o n s . TABLE X I I I TYPE OF DEMAND FUNCTION, COEFFICIENTS.- OF MULTIPLE DETERMINATION AND REGRESSION COEFFICIENTS FOR DIFFERENT REGIONAL MARKETS AND SUPPLY AREAS, ALL APPLES, 1954 - 1963 Type o f F u n c t i o n Log/Log (Three var-i a b l e s A r e a Western C a n a d a ( a l l a p p l e s ) E a s t e r n C a n a d a ( a l l a p p l e s ) (a) (b) (a) (b) 0.465 x x X X 0.479 n.s, n.s, P r i c e Income E l a s t i c i t y E l a s t i c i t y o f Demand o f Demand x x -0.5280 (0 . 2232) -0.5238 (0.2205) -1.0080** (0.4059) -1.004^** (0.4496) X X X -0.1943 (0.3019) n.s. n.s. n.s. W e s t e r n (a) n.s. C a n a d a ( l o c a l x x a p p l e s ) (fc) 0.485 n.s • n.s. n.s. n.s. E a s t e r n (a) C a n a d a ( l o c a l a p p l e s ) (b) Vancouver ( l o c a l a p p l e s ) (a) (b) n.s. n.s • 1 0.486^ n.s. xx n.s. n.s. n.s. n.s. -0.7910*** 1.0248*** (0.3360) (0.5369) . X X X -0.7619 (0.3570) n.s. T o r o n t o ( l o c a l a p p l e s ) (a) (b) n.s. n.s. n.s. n.s. n.s. n.s. . . . . c o n t ' d . TABLE X I I I Cont'd.... Type of F u n c t i o n Log/Log (Two V a r i a b l e s ) Area Western C a n a d a ( a l l Apples) R xx 0.433 P r i c e E l a s t i c i t y of Demand xx -0.5313 (0.2148) Income E l a s t i c i t y o f Demand E a s t e r n C a n a d a ( a l l Apples) n.s. xx -1.0077 (0.4202) Western Canada ( l o c a l apples) n.s • n.s. E a s t e r n Canada n.s. ( l o c a l apples) n.s Vancouver n.s. ( l o c a l apples) n.s. L i n e a r (Three v a r i a b l e s ) Toronto ( l o c a l apples) n.s. xx (a) 0.459 Western Canada xx ( a l l apples) (b) 0.474 X X X -2.9674 (1.3535) X X X -1.3953 (0.5958) -1.3813 (O.5883) n.s. n.s. (a) n.s. E a s t e r n Canada ( a l l apples) (b) n.s. x x x -2.7807 (1 . 2 9 3 D x x x -2.7803 (1.2868) n.s • n.s. xx Western (a) 0.437 C a n a d a ( l o c a l x x apples) (b) 0.506 n.s. n.s. n.s. n.s. . o . • c o n t *d. TABLE X I I I Cont'd.... P r i c e Income Type o f 2 E l a s t i c i t y E l a s t i c i t y F u n c t i o n Area R of Demand of Demand L i n e a r (Three v a r i a b l e s ) Vancouver (a) 0.496 ( l o c a l apples) (b) n.s. X X -2.7461 (1.1589) X X X -2.6207 (1.2431) X X X 0.0030 n.s Toronto ( l o c a l apples) (a) n.s. (b) n.s. n.s. n.s. n.s • n.s. xx S i g n i f i c a n t at % xxx S i g n i f i c a n t at 10$ (a) With X 2 a per c a p i t a d i s p o s a b l e income (b) With X 2 - net per c a p i t a d i s p o s a b l e income n.s. Not s i g n i f i c a n t F i g u r e s i n parentheses i n d i c a t e standard e r r o r . c. The use of the net per c a p i t a d i s p o s a b l e income estimates does not seem to make an a p p r e c i a b l e d i f f e r e n c e i n the r e g r e s s i o n c o e f f i c i e n t s . d. The c o e f f i c i e n t s of the income e l a s t i c i t i e s o f demand f o r a l l e s t i m a t i n g equations are l a r g e l y not s i g n i f i c a n t . e. Both the Cobb-Douglas and the l i n e a r m u l t i p l e r e g r e s s i o n equations show t h a t f o r a l l apples consumed, the p r i c e e l a s t i c i t y of demand i n Western Canada i s l e s s than i n E a s t e r n Canada. The Cobb-Douglas e q u a t i o n w i t h one independent v a r i a b l e i n d i c a t e s the same r e s u l t . S i n c e , however, the p r i c e e l a s t i c i t i e s of demand i n both r e g i o n a l markets are 3 5 a c c e p t a b l e a t low l e v e l s of s i g n i f i c a n c e , only a cautioned and q u a l i f i e d statement can be made r e g a r d i n g the d i f f e r e n c e s i n the two are a s . V a r i a t i o n s i n P r i c e s Graphs i l l u s t r a t i n g the v a r i a t i o n s i n the average d a i l y p r i c e s and shipments of a l l r e g u l a t e d f r u i t t o B r i t i s h Columbia, Western Canada (except B r i t i s h Columbia) and E a s t e r n Canada are g i v e n i n Appendix V I I . Table XIV contains the c o e f f i c i e n t s of v a r i a t i o n f o r the average p r i c e s and the percentage of the f r e s h f r u i t s u p p l i e d t o these markets E s p e c i a l l y at the 10$ l e v e l by B.C. Tree F r u i t s L t d . The p r o p o s i t i o n s t h a t can be made r e g a r d i n g the v a r i a t i o n s i n p r i c e s a r e : a. The c o e f f i c i e n t s of v a r i a t i o n f o r p r i c e s are lower g e n e r a l l y f o r the s o f t f r u i t group than the t r e e f r u i t group. A constant average p r i c e throughout the marketing season was charged f o r prunes and a p r i c o t s s o l d i n the three a r e a s . b. The graphs j u x t a p o s i n g the market shipments curve and the p r i c e l i n e of s o f t f r u i t s g e n e r a l l y i n d i c a t e a g r e a t e r c o n t r o l over the market by the agency. The g r e a t e r t h i s c o n t r o l i s the s m a l l e r the c o e f f i c i e n t o f v a r i a t i o n i n p r i c e s and the more removed from the c l a s s i c case of the magnitude of supply d e t e r m i n i n g p r i c e . c. The t r e e f r u i t group (apart from crab-apples) g e n e r a l l y shows c l o s e r conformity t o the case where p r i c e i s i n v e r s e l y r e l a t e d t o s u p p l y . The agency's c o n t r o l over p r i c e thus was l e s s than f o r the s o f t f r u i t group. T h i s i s e s p e c i a l l y t rue f o r a p p l e s . The reason f o r t h i s may be t h a t apples are the major f r u i t marketed by the agency and that there are other competitors i n the aggregate market f o r a p p l e s . d. Thus, while c o n t r o l over the supply of s o f t f r u i t i s by nature i m p o s s i b l e , the l a c k of c o m p e t i t i o n r e s u l t s i n a p r o t e c t e d market making p r i c e c o n t r o l p o s s i b l e . TABLE XIV COEFFICIENTS OF VARIATION (e.v.),FRESH FRUIT AVERAGE PRICES.1 AND THE PROPORTION (fa) OF REGIONAL SALES. RELATIVE TO AGGREGATE SALES, TO ALL MARKETS, I963 CROP. B r i t i s h Western E a s t e r n Columbia Canada Canada e.v. % % e.v. % e.v. % % Prunes 0 8 0 91 .0 1 C h e r r i e s 121.1. 12 10.2 61 - 23 A p r i c o t s 0 20 0 72 - 6 Plums 6.4 21 6.3 79 - 0 Peaches 3.9 23 5.6 76 - 0.2 Pears 11.7 7 8.8 37 10.1 25 Apples 10.3 12 9.5 24 10.1 10 Crab-apples 8.0 9 5.2 87 6.1 4 'Average p r i c e s of f r u i t are giv e n i n Appendix VIII. Summary The major procedures a p p l i e d by B.C. Tree F r u i t s L t d . to maximize the r e t u r n s t o growers were supply r e g u l a t i o n and a d i f f e r e n t i a t e d p r i c i n g p o l i c y . I t must be emphasized t h a t d i f f e r e n t i a t e d p r i c i n g was not p r a c t i s e d c o n s i s t e n t l y . CHAPTER VI SUMMARY AND CONCLUSIONS. A b r i e f review of the powers vested i n the B.C. F r u i t Board and the procedures a p p l i e d by B.C. Tree F r u i t s L t d . t o maximize grower r e t u r n s i s g i v e n p r i o r t o o f f e r i n g an a p p r a i s a l o f them. The s t r u c t u r e of the f r u i t marketing board e x e m p l i f i e s the r e s u l t o f both h o r i z o n t a l and v e r t i c a l i n t e g r a t i o n . H o r i z o n t a l i n t e g r a t i o n i s achieved through the c o - o r d i n a t i o n of f u n c t i o n s of the grower, s h i p p e r and packer, p r o c e s s o r and canner and the marketing agency. V e r t i c a l i n t e g r a t i o n i s e s p e c i a l l y prominent at the grower and packing-house stages of the production-marketing p r o c e s s . Such i n t e g r a t i o n p rovides f o r g r e a t e r e f f i c i e n c y i n marketing and d i s t r i b u t i o n . A c o n t r a c t u a l r e l a t i o n s h i p e x i s t s between B.C. Tree F r u i t s L t d . and the pro c e s s o r s who undertake t o buy s p e c i f i e d q u a n t i t i e s of p r o c e s s i n g and canning grade f r u i t . The p o o l i n g and d i s t r i b u t i o n of r e t u r n s i s an important f a c e t of the r e l a t i o n s h i p between the F r u i t Board and the growers. R e g u l a t o r y c o n t r o l of the Okanagan r e g i o n r e s t s w i t h the F r u i t Board. The main v i o l a t i o n s i n v e s t i g a t e d are f o r the s a l e of r e g u l a t e d f r u i t above the s p e c i f i e d maximum through f r u i t stands and i l l e g a l movements of f r u i t . Supply c o n t r o l i s a procedure a p p l i e d by the agency to maximize r e t u r n s s p a t i a l l y , i n time and i n use. A s e a s o n a l d i s t r i b u t i o n a n a l y s i s of f r u i t r e v e a l s that the marketing p e r i o d s of apples and pears i s longer compared to t h e i r h a r v e s t i n g p e r i o d s than f o r the s o f t -f r u i t group. The c o e f f i c i e n t of v a r i a t i o n of shipments to the market does not r e v e a l any s i g n i f i c a n t p a t t e r n s . While t h i s f i g u r e i s h i g h e s t for a p p l e s , the s o f t - f r u i t group contains f r u i t which have h i g h e r r e l a t i v e v a r i a t i o n s than e i t h e r pears or c r a b - a p p l e s . S . t o r a b i l i t y i s d i r e c t l y r e l a t e d t o the p e r i s h a b i l i t y of f r u i t . Hence as a means of supply management, t h i s i s more e f f i c i e n t l y used f o r a p p l e s , pears and crab-apples than f o r the s o f t - f r u i t group. To d i m i n i s h the d e p r e s s i n g e f f e c t s upon p r i c e s i n times of h i g h p r o d u c t i o n , d i v e r s i o n of f r u i t s i n t o p r o c e s s i n g and canning i s employed. Sun'-xRype Products L t d . absorbed 70 percent of such f r u i t i n 1963-1964. For a s p a t i a l d i s t r i b u t i o n of f r u i t , s o f t - f r u i t can be considered s o l e l y f o r the domestic Canadian market. Apples and pears are the main export commodities of the agency. Canada as a whole consumed 58 percent of a l l f r u i t , f o l l o w e d by the United S t a t e s , U n i t e d Kingdom and the other o f f - s h o r e markets. The r e s p o n s i b i l i t y o f the c o n t r o l over p r o d u c t i o n o f Okanagan V a l l e y f r u i t i s not vested i n the F r u i t Board or i t s agency. However, the A g r i c u l t u r a l Club recommends, 103 when i t sees f i t , new p l a n t i n g s or the e l i m i n a t i o n of some v a r i e t i e s of f r u i t . The s o l e marketing agency performs a very important f u n c t i o n here as i t i s able t o r e c e i v e , c o n s o l i d a t e and tr a n s m i t i n f o r m a t i o n r e g a r d i n g consumer pr e f e r e n c e s t o the growers. Market i n t e l l i g e n c e and news d i s s e m i n a t i o n are f u n c t i o n s of the agency. The p r i c i n g p o l i c y of the marketing agency i s geared t o a s t a b l e and high-income o b j e c t i v e f o r the growers. Apart from t h i s , i t i s imp o s s i b l e t o s t a t e c a t e g o r i c a l l y t h a t i t f o l l o w s a d e f i n i t e p r i c i n g p o l i c y . That t h i s i s so i s because o f the number and extent of the i n f l u e n c e of the v a r i a b l e s which have t o be taken i n t o account before a p r i c e can be quoted. The s i t u a t i o n becomes more complex as these f a c t o r s cannot be determined i n advance. D i f f e r e n t i a t e d p r i c i n g i s d e f i n i t e l y p r a c t i c e d by the agency. Although there i s no e m p i r i c a l support, one would surmise t h a t a p o l i c y o f f r e i g h t - a b s o r p t i o n i s f o l l o w e d t o a t t a i n t h i s aim. It can g e n e r a l l y be s t a t e d t h a t , at l e a s t f o r Canada, the E a s t e r n r e g i o n a l market y i e l d s l e s s r e t u r n s t o the growers than the Western r e g i o n a l market. L i m i t e d evidence about the demand f u n c t i o n s f o r apples i n both these regions i n d i c a t e s there i s some economic b a s i s f o r such a p o l i c y . There i s , hence, d i s c r i m i n a t o r y p r i c i n g against Western Canadian consumers. A c o n s i s t e n t p o l i c y of p r i c e d i f f e r e n t i a t i o n cannot however be s a i d t o e x i s t because i n s t a n c e s occur when returns from sales made are greater from the Western than the Eastern markets. An analysis of the variations i n prices and market shipments indicates that f o r the t r e e - f r u i t group, despite i t s s t o r a b i l i t y , a closer adherence to the c l a s s i c case i n agriculture of price being the inverse of market supply i s shown. Insofar as th i s factor i s concerned, there is a greater degree of market control over soft f r u i t s by the marketing agency. T a r i f f control is the prerogative of the Federal Government. The Western Zone Trade and T a r i f f Committee, i n consultation with the agency, recommends the dates for implementing the statutory t a r i f f s . During an emergency, the former can make representations to the T a r i f f Board of Canada for invoking a clause i n the Amendment to the Customs Act, 1958, which would raise a t a r i f f wall on imported f r u i t sold at abnormally low p r i c e s . Up to 1963, the T a r i f f Board has overruled a l l such requests. An evaluation of the powers of the Fr u i t Board and procedures employed by B.C. Tree F r u i t s Ltd. must be done i n r e l a t i o n to the objectives of this study s a. What is the extent of the use of such powers and procedures? b. How does the existence of the marketing board detract from pure competition; i e . , how close to a monopoly is the agency? The j u d i c i a l extent of the powers vested i n the Board 105 i s purposely vague to give l a t i t u d e and f l e x i b i l i t y t o the agency's o p e r a t i o n s . In the l i g h t of these powers i t i s f i r s t necessary t o deduce the I m p l i c i t o b j e c t i v e s of the marketing board. S.ince p r i c e and income f l u c t u a t i o n s were the main causes of farmer d i s c o n t e n t , i t s r e c t i f i c a t i o n or a m e l i o r a t i o n must be the main o b j e c t i v e s of the Board, These aims, i f p r a c t i s e d s i m u l t a n e o u s l y , are s e l f - d e f e a t i n g s i n c e a g r i c u l t u r a l p r o d u c t i o n i s s u b j e c t t o f l u c t u a t i o n s . S i n c e the maintenance of h i g h p r i c e s e s s e n t i a l l y maximizes p r o f i t i n the s h o r t - r u n , one would expect the agency to aim at s t a b i l i z i n g and maximizing income i n the long r u n . T h i s i t does through demand expansion, d i f f e r e n t i a t e d p r i c i n g , s p a t i a l d i s t r i b u t i o n of f r u i t and other r e g u l a t o r y c o n t r o l s . A second o b j e c t i v e , s i n c e an aggregate farmers' i n t e r e s t i s concerned, would be the e q u a l i z a t i o n of r e t u r n s of i d e n t i c a l f r u i t , i r r e s p e c t i v e of i t s end use or d e s t i n a t i o n . T h i s i s achieved through a system of p o o l i n g r e t u r n s . With these o b j e c t i v e s s p e l l e d out, i t i s p o s s i b l e to proceed t o an a p p r a i s a l of the procedures p r a c t i s e d by the B.C. F r u i t Board and B.C. Tree F r u i t s L t d . The i n t e g r a t i n g f o r c e of the whole scheme i s the compulsory p a r t i c i p a t i o n of a l l growers i n the area i n i t s a c t i v i t i e s . T h i s e l i m i n a t e s the t h r e a t of recusancy and makes p o s s i b l e e f f e c t i v e supply management by the s o l e s e l l i n g agency. C o n t r a c t u a l p a r t i c i p a t i o n of the s h i p p e r s , packers, canners and pro c e s s o r s f u r t h e r extends the i n t e g r a t i o n process, and r a i s e s the e f f i c i e n c y of the marketing scheme. Only f o r the processors and canners i s there a weak l i n k i n the c h a i n of i n t e g r a t i o n a r i s i n g from the f a c t that there i s no c o n t r o l over the s a l e s of processed and canned f r u i t . The law empowers the Board t o employ p o o l i n g i n order t o make r e p r e s e n t a t i v e and e q u i t a b l e r e t u r n s t o growers f o r t h e i r f r u i t s o l d . No s p e c i f i c methods are recommended and the d i v e r s i t y of methods c u r r e n t l y used i n d i c a t e s that the best method has yet to be d e v i s e d . Two major problems beset the P o o l i n g Committees i n t h e i r s e a r c h to comply w i t h the r e g u l a t i o n s . One p e r t a i n s to the method of p o o l i n g and the other t o the d u r a t i o n of the p e r i o d s w i t h i n each p o o l . C u r r e n t l y three main types of p o o l i n g are In use: market r e t u r n s p o o l i n g , y a r d s t i c k p o o l i n g and t r e n d - l i n e p o o l i n g . Of the three methods, y a r d s t i c k p o o l i n g seems the l e a s t r e p r e s e n t a t i v e of the contemporary market s i t u a t i o n , s i n c e r e t u r n d i f f e r e n t i a l s between v a r i e t i e s , grades and s i z e s are pre-determined on the b a s i s of h i s t o r i c a l d a t a . In a sense, what the growers r e c e i v e when t h i s method i s i n use i s what the P o o l i n g Committees t h i n k , w i t h a l l t h e i r e x p e r i e n c e , they should r e c e i v e . T h i s judgment may not conform t o the maximum r e t u r n s that some growers a c t u a l l y ought t o r e c e i v e . G i v e n the human element i n v o l v e d i n t h i s 107 method, there i s a reasonable argument f o r r e s o r t i n g to the impersonal f o r c e s of the market to determine grower r e t u r n s . Of the two remaining methods, t r e n d - l i n e p o o l i n g o f f e r s the best hope f o r an e q u i t a b l e d i s t r i b u t i o n of r e t u r n s , e s p e c i a l l y i n the case of f l u c t u a t i n g f r u i t p r i c e s , where i t would g i v e the mathematically best f i t to the v a r i a t i o n s . Miere constant market r e t u r n s are earned, (as f o r the 1963 f r e s h a p r i c o t and prune shipments), the market r e t u r n s p o o l i n g system would seem i d e a l . The present methods used by B.C. Tree F r u i t s L t d . leave i t t o the two P o o l i n g Committees t o s p e c i f y the l e n g t h of the p e r i o d pools and the e a r l y p o o l s . Once a g a i n the a r b i t r a r y demarcation of pools would not a r i s e w i t h t r e n d -l i n e p o o l i n g , where, as at p r e s e n t , the bi-weekly pools seem to Ibe the s m a l l e s t p e r i o d pools p r a c t i c a b l e without i n v o l v i n g the agency wi t h an insurmountable i n c r e a s e i n a d m i n i s t r a t i v e work and accounting procedures, Another advantage of t r e n d - l i n e p o o l i n g i s that cannery and p r o c e s s i n g e q u a l i z a t i o n and p o o l claims would a u t o m a t i c a l l y be prorated over the whole marketing p e r i o d . T h i s i s not the case now where separate p r o c e s s i n g and canning pools are e s t a b l i s h e d . Although t r e n d - l i n e p o o l i n g negates the use of separate cannery and p r o c e s s i n g pools and the payment of premiums f o r early-marketed f r u i t , i t does not make p r o v i s i o n f o r i n t e r - p o o l s u b s i d i e s , a procedure a p p l i e d f o r apples l a s t y e a r . One s o l u t i o n would be to p r o r a t e these s u b s i d i e s over the whole donor p o o l . One other disadvantage Inherent i n c u r r e n t p o o l i n g procedures i s the maintenance of season pools (as f o r apples) which does not adequately r e f l e c t the p r i c e r e c e i v e d f o r d i f f e r e n t shipment d a t e s . For example, f o r one v a r i e t y of apple, growers r e c e i v e equal r e t u r n s i r r e s p e c t i v e of the time of m a t u r i t y of t h e i r c r op. No premiums are o f f e r e d f o r the e a r l y - m a t u r i n g apples and so no i n c e n t i v e i s g i v e n t o farmers to harvest and s h i p t h e i r crops q u i c k l y . In t h e o r y , the payment of a seasonal average r e t u r n does not r e f l e c t f o r e a r l y - m a t u r i n g crops the t r u e value t h a t the market i s w i l l i n g t o pay f o r i t . In f a i r n e s s t o the agency and the P o o l i n g Committee, t r e n d - l i n e p o o l i n g i s but a recent i n n o v a t i o n whose p r a c t i c a l p o s s i b i l i t i e s have yet t o be f u l l y e x p l o r e d . The c o n t r o l of supply can be appraised from two a s p e c t s . The f i r s t d e a l s w i t h the c o n t r o l of r e g u l a t e d f r u i t i n the j u r i s d i c t i o n a l d i s t r i c t of the Board. In t h i s r e s p e c t , maximum p o l i c i n g and i n s p e c t i n g seems to be i n e f f e c t . The second aspect deals with supply management through the use of storage f a c i l i t i e s , through d i v e r s i o n t o other uses and through optimum s p a t i a l d i s t r i b u t i o n of the r e g u l a t e d p r o d u c t s . 109 I t has a l r e a d y been i n d i c a t e d t h a t the t r e e - f r u i t group i s l e s s p e r i s h a b l e t h a n the s o f t - f r u i t group. R e g u l a t e d s u p p l y (because the former group s e r v i c e s i m p o r t a n t e x p o r t markets) i s made not as e f f i c i e n t as i t s h o u l d be. F o r the s o f t - f r u i t g roup, w h i l e p e r i s h a b i l i t y i s an i m p o r t a n t d e t e r r e n t t o e f f i c i e n t market c o n t r o l , the f a c t t h a t l e s s c o m p e t i t i o n i s f a c e d i n l o c a l m a r k e t s , e n a b l e s the m a r k e t i n g agency t o e x e r t some measure o f s u p p l y c o n t r o l t h r o u g h i t s p r i c i n g p r o c e d u r e . These two f a c t o r s have t o be c o n s i d e r e d i n any e v a l u a t i o n o f the use o f s u p p l y management p r o c e d u r e s by the agency. D o u b t l e s s l y an e x t e n s i o n of the m a r k e t i n g p e r i o d would g r e a t l y f a c i l i t a t e s u p p l y management. Here the agency would have t o r e l y upon the t e c h n i c a l a g r i c u l t u r a l s c i e n c e s t o produce f r u i t s w i t h l e s s p e r i s h a b l e q u a l i t i e s or improved s t o r a g e f a c i l i t i e s w h i c h would m a i n t a i n t h e p h y s i c a l and e a t i n g q u a l i t i e s o f the f r u i t . For the o t h e r p r o c e d u r e s of s u p p l y management, the m a r k e t i n g agency seems t o have a t t a i n e d o v er the ye a r s a wide s p a t i a l d i s t r i b u t i o n o f f r u i t and a v a r i e t y of end-uses f o r excess f r u i t . The many i n d e t e r m i n a t e v a r i a b l e s a f f e c t i n g the p r i c e o f f r u i t make i t i m p o s s i b l e t o s t a t e t h a t a d i s t i n c t and c o n s i s t e n t p r i c e p o l i c y by t h e m a r k e t i n g agency has been p r a c t i s e d . Mackenzie has s t a t e d t h a t f o r a c e n t r a l s a l e s agency. a more i m p o r t a n t f u n c t i o n t h a n p r i c e r a i s i n g i s p r i c e s t a b i l i z a t i o n . T h i s has been f o l l o w e d e s p e c i a l l y i n t h e case of the s o f t f r u i t s u p p l i e d t o l o c a l and p r o t e c t e d m a r k e t s . MacPhee i n h i s r e p o r t has observed t h a t i n c omparison w i t h Yakima, Wenatchee and o t h e r U n i t e d S t a t e s m a r k e t i n g c e n t r e s , c e n t r a l s e l l i n g i n the Okanagan has 3 7 tended t o s t a b i l i z e p r i c e m a r k e d l y . P r i c e s t a b i l i z a t i o n has been a c h i e v e d by the d i v e r s i o n of excess s u p p l i e s t o p r o c e s s i n g and c a n n i n g o u t l e t s e s p e c i a l l y . P r i c e c o n s t a n c y not o n l y c r e a t e s a f a v o u r a b l e image i n the consumer's mind, i t a l s o i n c u l c a t e s c o n f i d e n c e i n them and e s p e c i a l l y i n volume buyers t h a t t o a degree the q u a n t i t y of market s u p p l i e s w i l l not a f f e c t p r i c e s m a r k e d l y . P r i c e d i f f e r e n t i a t i o n i s a p r o c e d u r e g r a n t e d by l e g i s l a t i o n and t h i s t h e agency a c t i v e l y a p p l i e s i n a t t e m p t i n g t o maxim.'ize grower r e t u r n s . I n extreme c a s e s , what i n s e c u l a r nomenclature i s c a l l e d "dumping" i s p r a c t i s e d -as f o r the 1964 c h e r r y crop when, w i t h t h e s a t u r a t i o n o f t r a d i t i o n a l m a r k e t s , i t was d e c i d e d t o s e l l c h e r r i e s t o the U n i t e d Kingdom market on a consignment b a s i s . T a r i f f r e g u l a t i o n i s a f a c t o r beyond th e c o n t r o l o r i n f l u e n c e by the B o a r d . T h i s i s t r u e t o o of t h e 3&Ganadian A g r i c u l t u r a l Economics S o c i e t y , S i x t h A n n u a l l o r s h o p R e p o r t , o p . c i t . . p. 2 8 . 3 ? R o y a l Commission on the Tree F r u i t I n d u s t r y . o p . c i t . p . 5 6 1 . i n f l u e n c e i t has over the d e c i s i o n s p e r t a i n i n g to the p r o d u c t i o n of f r u i t i n the r e g u l a t e d a r e a . I t has been mentioned p r e v i o u s l y that the marketing scheme e x i s t s t o a t t a i n a s t a b l e income f o r the growers. The e x e r c i s e of a l l 'the powers mentioned are geared to t h i s o b j e c t i v e . I m p l i c i t i n t h i s o b j e c t i v e of income s t a b i l i z a t i o n i s the simultaneous s t r i v i n g by the agency to maximize p r o f i t s f o r the growers. I t i s d i f f i c u l t i n the absence of e m p i r i c a l p roof t o s t a t e whether or not p r o f i t s are maximized i n any time p e r i o d through the e q u a l i z a t i o n of marginal cost and m a r g i n a l revenue.' I t i s p o s s i b l e t o s t a t e , n e v e r t h e l e s s , that p r o f i t maximization i n the s h o r t - r u n may not be compatible with the income s t a b i l i z a t i o n o b j e c t i v e s i n c e t h i s e s s e n t i a l l y r e f l e c t s a l o n g - r u n s i t u a t i o n . Thus the agency would have to c o n s i d e r the consequences on t r a d i t i o n a l o u t l e t s i f t o maximize s h o r t - r u n p r o f i t s i t quotes h i g h p r i c e s i n s h e l t e r e d markets. It has been i n d i c a t e d i n the i n t r o d u c t i o n t h a t the maximization of p r o f i t s i n a s p a t i a l l y e x t e n s i v e market i s a t t a i n e d by the e q u a l i z a t i o n of marginal revenues i n the segmented markets. Here a g a i n e m p i r i c a l p roof of t h i s f o r the marketing agency i s l a c k i n g . W i t h i n the frame?/ork o f t h i s study, i t i s not p o s s i b l e t o s t a t e o b j e c t i v e l y t h a t s t a b i l i t y of p r i c i n g i s conducive t o the e q u a l i z a t i o n of m a r g i n a l revenues and 112 p r o f i t maximization. However, i t i s t h e o r e t i c a l l y p o s s i b l e that even w i t h p r i c e s t a b i l i t y through time, a simultaneous s h i f t of the demand curves i n a l l separate markets can s t i l l r e s u l t i n the equation of r e g i o n a l m a r g i n a l revenues. The marketing agency i s the s o l e s e l l e r of Okanagan f r u i t by v i r t u e of the compulsory p a r t i c i p a t i o n of a l l growers i n the scheme. The d u r a t i o n of the e x i s t e n c e of the scheme i s , u n l i k e an i n s t i t u t i o n a l monopoly f o r i n s t a n c e , s o l e l y i n the hands of the growers as a t w o - t h i r d m a j o r i t y of them can vote the scheme out of e x i s t e n c e . T h i s l e g a l r i g h t to d i s s o l v e the scheme i s t h e r e f o r e a p e r t i n e n t f a c t o r i n a p p r a i s i n g the m o n o p o l i s t i c powers of the agency. The statement that B.C. Tree F r u i t s L t d . i s a s o l e s e l l e r i s v a l i d i n an extremely narrow context s i n c e there are competing supply areas such as Washington, Oregon, E a s t e r n Canada and other o f f - s h o r e p o i n t s . The p r i c e - e s c a l a t i n g powers of the agency i s then e f f e c t i v e l y l i m i t e d . A. c o n s i s t e n t l y h i g h p r i c e f o r f r u i t s i n any of the markets s e r v i c e d by the agency would a t t r a c t other s u p p l i e r s . In e f f e c t , then, the agency faces the p o s s i b i l i t y of p r i c i n g i t s e l f out of the market. T h i s e v e n t u a l i t y a monopoly does not face at a l l . The presence of pompeting s u b s t i t u t e s serves as a powerful d e t e r r e n t to the p o s s i b i l i t y of the agency charging monopoly p r i c e s . No powers of p r o d u c t i o n c o n t r o l are vested i n the 113" agency. T h i s absence a l s o serves as a l i m i t a t i o n on the e x e r c i s e of monopoly procedures by the agency. Even i f i t were delegated such powers i t s c o n t r o l over p r o d u c t i o n would be weakened by the f a c t that i t s t i l l would face a dynamic market and the p e r i o d between new p l a n t i n g and t r e e b e a r i n g . F i n a l l y , i t i s not w i t h i n the j u r i s d i c t i o n a l powers of the Board or i t s agency to c o n t r o l or i n f l u e n c e the l e v e l o f t a r i f f s t o p r o t e c t i t s home markets. The competitive s t r u c t u r e . o f the marketing process i s a f f e c t e d by the e x i s t e n c e of the marketing scheme. The i n t e g r a t e d nature of the scheme only allows f o r the e x e r c i s e of p o l i c i n g powers and the a p p l i c a t i o n of supply management and differentaated p r i c i n g procedures. BIBLIOGRAPHY I. BOOKS Bowring, J.R., Southworth,H.M. and l a u g h , F.V. Marketing  P o l i c i e s f o r A g r i c u l t u r e . New J e r s e y , P r e n t i c - H a l l Inc., I960. Chamberlain, E.H. The Theory of M o n o p o l i s t i c Competition. London, Macmillan and Co., 1934. Cochrane, W.W. Farm P r i c e s Myth or R e a l i t y . M i n n e a p o l i s , U n i v e r s i t y of Minnesota P r e s s , 1958. G a l b r a i t h , J.K. American C a p i t a l i s m The Concept of C o u n t e r v a i l i n g Power. Boston, Houghton M i f f l i n Co.,1956. Mac f a r l a n e , D.L. and Bla c k , J.D. The Development of Canadian  A g r i c u l t u r e t o 1970. Macdonald C o l l e g e , 1958. N i c h o l l s , W.H. Imperfect Competition W i t h i n A g r i c u l t u r a l I n d u s t r i e s . Ames, The Iowa S t a t e C o l l e g e Press, 1947. Robinson, J . Economics of Imperfect Competition, London, Ma c m i l l a n and Co., 1934. S c h u l t z , T.W. The Economic O r g a n i z a t i o n of A g r i c u l t u r e . New York, McGraw-Hill Book Co.Inc., 1953. Shepherd, G. Marketing Farm P r o d u c t s . Ames. The Iowa S t a t e C o l l e g e P r e s s , 1958. Waugh, F.V. ed. Readings i n A g r i c u l t u r a l Marketing. Ames, The Iowa S t a t e C o l l e g e P r e s s , 1954. . A g r i c u l t u r e i n an Unstable Economy. New York, McGraw Book Co. Inc., 1945. I I PERIODICALS Brewster, J.M. and Parsons, H.L. "Can P r i c e s A l l o c a t e Resources i n American A g r i c u l t u r e ? " J o u r n a l of Farm  Economics. XXVIII, Nov. 1946. C l o d i u s , R.L. "O p p o r t u n i t i e s and L i m i t a t i o n s i n Improving the Ba r g a i n i n g Power of Farmers," c i t e d i n Iowa St a t e Centre f o r A g r i c u l t u r a l Adjustment, Problems and P o l i c i e s of  American A g r i c u l t u r e . Ames. The Iowa S t a t e U n i v e r s i t y P r e s s , I 960 . Cochran, T.C. " H i s t o r i c a l Aspects of Imperfect Competition: Theory and H i s t o r y , " J o u r n a l of Economic H i s t o r y . I l l , Dec. 1943. Cochrane, W.W. " C o n c e p t u a l i z i n g the Supply R e l a t i o n i n A g r i c u l t u r e " J o u r n a l of Farm Economics. XXXVII, Dec. 1 9 5 5 . Cochrane, W.W. "Farm P r i c e G y r a t i o n s - an Aggregative Hypothesis," J o u r n a l of Farm Economics. XXIX, May,194$. Cochrane, W.W and Butz, W.T. "Output Responses of Farm F i r m s , " J o u r n a l of Farm Economics. XXXIII, Nov. 1 9 5 1 . Daly, R.F. "Long^'Range Demand f o r Farm P r o d u c t s . " A g r i c u l t - u r a l Economics Research. I l l , J u l y 1 9 5 6 . D a v i s , J.H, "From A g r i c u l t u r e t o Agribusiness." Harvard  Business Review. XXXIV, Jan.-Feb. 1956. G a l b r a i t h J.K. and B l a c k J.D. "The Maintenance of A g r i c u l t u r a l P r o d u c t i o n During Depression: the E x p l a n a t i o n s Reviewed," J o u r n a l of P o l i t i c a l Economy. IVL, June 1 9 3 8 . Johnson, G.L. "Supply Functions - Some Fact s and Notions.1.!" In E.O.Heady e t . a l . ed. A g r i c u l t u r a l Adjustment Problems  i n a. Growing Economy. Ames, The Iowa State C o l l e g e P r e s s , 1958. L a n z i l l o t i , R.F. "The S u p e r i o r Market Power of Food P r o c e s s i n g and A g r i c u l t u r a l Supply Firms." J o u r n a l of Farm  Economics. X L I I , Dec. i 9 6 0 . L e o n t i e f f , W. "Theory of L i m i t e d and U n l i m i t e d D i s c r i m i n a t i o n . " Q u a r t e r l y J o u r n a l of Economics 1 LIV, May, 1940. I l l OTHER SOURCES. Beckford, M.L. Demand A n a l y s i s f o r S e l e c t e d A g r i c u l t u r a l  Commodities. Canada. 1926 - 1962. Unpublished Ph.D. D i s s e r t a t i o n , F a c u l t y of Graduate S t u d i e s and Research, U n i v e r s i t y of Manitoba, 1964. B r i t i s h Columbia, Department of A g r i c u l t u r e , H o r t i c u l t u r a l Branch, Orchard Survey of the Okanagan V a l l e y ? 1 9 5 5 . B r i t i s h Columbia, F r u i t Growers' A s s o c i a t i o n Q u a r t e r l y  Report. 1962 and 1963. 1 1 4 B r i t i s h Columbia.Natural Products Marketing ( B r i t i s h Columbia)  A c t . R.S. 1948, c.200, s . l . B r i t i s h Columbia. N a t u r a l Products Marketing ( B r i t i s h Columbia) Ac t , B r i t i s h Columbia Tree F r u i t Marketing S.cheme. I 9 6 0 . B r i t i s h Columbia, Royal Commission on the Tree F r u i t Industry of B r i t i s h Columbia, Report, V i c t o r i a , B.C. Queen's P r i n t e r , 1958. " Canada. A g r i c u l t u r a l Products Marketing Act, B.C. Tree F r u i t  Export R e g u l a t i o n s . SOR/63 - 376, 1963 Canada. A g r i c u l t u r a l Products Marketing Act (Canada), 1949. Canada, Department of A g r i c u l t u r e , P r o d u c t i o n and Marketing Branch, Markets I n f o r m a t i o n S e c t i o n , Crop and S e a s o n a l  Summaries. 1947-1963. Canada, Dominion Bureau of S t a t i s t i c s , Canada Year Book. 1954 - 1963. Canada, R o y a l Commission on Canada's Economic P r o s p e c t s ! P r o g r e s s and Prospects of Canadian A g r i c u l t u r e . Ottawa. Queen's P r i n t e r , 1957. Canada, Royal Commission on P r i c e Spreads of Food Products, Report, I I I , Ottawa, Queen's P r i n t e r , 1961. Canadian A g r i c u l t u r a l Economics S o c i e t y , S i x t h Annual Yiforkshop Report, A g r i c u l t u r a l Marketing Board. 1961. Menzies* M.W. and S c h e f r i n , F. Demand Outlook f o r Canadian A g r i c u l t u r e , Resources f o r To-morrow Conference. I, J u l y , 1961. APPENDIX I TABLE XV CUMULATIVE PERCENT OF OUTPUT CONTROLLED BY NUMBERS OF FIRMS CANADA, 194-8 AND 1956. I n d u s t r y Group 1-5 Number of Firms shown i n Brackets 6-10 11-15 16-20 21-25 25-30 TOTAL Prepared Break-f a s t Foods 1948 1956 Processed Cheese 1948 1956 Sugar 1948 1956 F l o u r 1948 1956 Animal O i l s and Fats 1948 1956 Meat Packing 1948 1956 92(3) 87(3) (81(5) 88(4) 73(3) 75(3) 32(3) 80(4) 86(3) 65(3) 70(5) 71(4) 96(7) 94(7) 99(6) 97(6) 74(9) 90(8) 95(6) 86(6) 97(12) 80(14) 97(23) 80(13) 80(12) 86(22) 89(23) 100(19) 100(16) 100(19) 100(17) 100(7) 100(7) 100(156) 100(59) 100(9) 100(16) 100(120) 100(126) ....cont'd. APPENDIX I Indus t r y Group 1-5 6-10 B i s c u i t s and Crackers 1948 76(7) 1956 69(4) 79(7) Condensed M i l k 1948 62(6) 1956 59(4) 79(9) Vegetable O i l M i l l s 1948 51(4) 1956 45(3) 88(6) Sausage and S.ausage Casing 1948 1956 38(3) 53(7) F r u i t s and Vegetables 1948 41(3) 5K8) 1956 43(4) "Other" D a i r y Products 1948 33(4) 1956 30(3) Bread and Other Bakery Products 1948 33(5) 42(8) 1956 37(6) TABLE XV C o n t ! d . , . . 11-15 16-20 21-25 25-30 TOTAL 88(13 89(11) 94(17) 96(21) 99(30) 99(29) 100(41) 100(34) 79(12) 37(16) 97(23) 98(21) 100(30) 100(25) 100(12) 100(10) 59(14) 80(26) 100(70) 100(101) 59(12) 100(278) 7K13) 82(16) 100(80) 100(50) 52(17) 54(18). 56(29) 100(2748) 100(2481) .,.,cont *d, co-: APPENDIX I TABLE XV Cont'd.».. I n d u s t r y Group 1 - 5 6-10 1 1 - 1 5 16-20 2 1 - 2 5 2 5 - 3 0 TOTAL F i s h P a c k i n g and C u r i n g 1948 3 7 ( 6 ) 1 9 5 6 3 2 ( 4 ) 54 ( 1 1 B u t t e r and Cheese 1948 1 3 ( 2 ) 2 1 ( 7 ) 24 ( 1 1 ) 1 9 5 6 2 2 ( 5 ) M a c a r o n i 1948 1956 6 7 ( 1 9 ) 6 8 ( 3 0 ) 3 2 ( 3 0 ) 4 5 ( 3 0 ) 100(527) 100(414) 100(1848) 100(1183) 100 0.4) 1 0 0 ( 1 5 ) Sour ce: Canada, Report o f the R o y a l Commission ofil P r i c e Spreads of Food P r o d u c t s , R e p o r t . I l l , Ottawa, Queen's P r i n t e r , I 9 6 0 , T a b l e I , pp.94-96. SO APPENDIX I - TABLE XVI EXTENT OF CONCENTRATION OF CONTROL OF THE ASSEMBLY, PROCESSING AND WHOLESALE DISTRIBUTION OF THE PRINCIPAL CLASSES. OF FARM PRODUCTS AND THEIR PRIMARY DERIVATIVES-, UNITED STATES, 1934 % of T o t a l Volume o f Domestic B u s i n e s s (1934) Handled by N o n / P r o c e s s i n g Farm P r o d u c t P r o c e s s o r D i s t r i b u t o r Assembly Middlemen S i n g l e 3 L a r g e s t L a r g e s t 3 L a r g e s t L i v e s t o c k 57.4 28.4 C a t t l e and C a l v e s 62.4 29.3 6.8 Hogs 48.0 24.0 1.6 Sbeep and Lamb 79.2 39.7 M i l k ( a l l u s e s ) 21.1 9.4 B u t t e r 20.8 8.1 Cheese 62.9 32.2 Canned M i l k 44.3 18.7 Tobacco L e a f 46.2 22.2 24.6 ( E x p o r t ) C i g a r e t t e s 80.1 27.3 Smoking Tobacco 64.8 23.2 Chewing Tobacco 68.7 26.4 C i g a r s 27.7 -S n u f f 95.3 42.0 Wheat 38.4 23.3 13.1 Wheat F l o u r 29.0 15.7 Wheat Bread 19.4 — — C o t t o n ( l i n t ) 3.2 1.2 20.1 Canned F r u i t s 13.0 5.0 — Canned V e g e t a b l e s 30.0 15.0 -G r o c e r y R e t a i l i n g 22.1 13.7 -S o u r c e : F.V. Waugh ed. Readings i n A g r i c u l t u r a l M a r k e t i n g . Ames, The Iowa S t a t e C o l l e g e P r e s s , 1954, T a b l e I X , p. 247. APPENDIX I I TABLE XVII. POOL RETURNS, FOR PRUNES, 1963 CROP Average Naked P e r i o d F r u i t Return Pools Dates Grade ( $ / l b ) 1 To Aug.13 Domestic 0.05031 2 Aug.14 - 20 Domestic 0.04781 3 Aug.21. on Domestic 0.04531 Cannery 0.04984 Source: Poo l C l o s i n g C i r c u l a r No.5. B.C.Tree F r u i t s L t d . November 5, 1953. APPENDIX I I TABLE X V I I I POOL RETURNS. FOR PLUES, 1963 CROP Group P e r i o d P o o l Dates Grade Average Naked F r u i t R e t u r n <*/lb) 1 2 Aug.1-15 N o . l 0.06878 Damson 3 Aug.16-31 N o . l 0.06560 4 S e p t . N o . l 0.66264 5 O c t . N o . l 0.06040 2 Peach Plum 1 J u l y N o . l 0.04674 2 Aug.1-15 N o . l 0.04623 3 Aug.16-31 N o . l 0.04557 4 S e p t . N o . l 0.04532 3 2 Aug.1-15 N o . l 0.03645 Green Gage 3 Aug.16-31 N o . l 0.03636 4 S e p t . N o . l 0.03590 4 3 Aug.16-31 N o . l 0.02969 Other Gage 4 S e p t . N o . l 0.02923 5 1 J u l y N o . l 0.04007 Other Plums 2 Aug.1-15 N o . l 0.03956 3 Aug.16-31 N o . l O.O389O 4 S e p t . N o . l 0.03865 S o u r c e : P r e l i m i n a r y P o o l C l o s i n g C i r c u l a r No.6. B.C. Tree F r u i t L t d . , No.5 1963. 123 APPENDIX I I TABLE XIX POOL RETURNS FOR APRICOTS:, 1963 CROP Group V a r i e t y Grade Average Naked F r u i t Return ($/lb ) 1 R o y a l Blenheim T i l t o n N o . l L M Cannery L : Cannery M 0.07308 0.07735 0.05235 2 Yfenatchees, Moor park Ryland, Kaleden No. 1 Cannery 0.06372 0.06372 3 Other Cots No.l Cannery 0.06372 0.06372 A l l ilam No.2 0.02237 Groups Source: P r e l i m i n a r y P o o l C l o s i n g C i r c u l a r No.2. B.C. free F r u i t L t d . , October 2, 1963. APPENDIX I I TABLE XX POOL RETURNS, FOR CRAB-APPLES, I963 CROP Group V a r i e t y 1 Trans-cendents P e r i o d P o o l 2 Hyslops Season Dates to Aug.14 Aug.14-23 Aug.24 on Average Naked Grade F r u i t Return ($/lb) Fancy 0 . 0 2 6 6 2 Cee 0.02136 Fancy 0 . 0 2 3 9 9 Cee 0 . 0 1 8 7 3 Fancy 0.01600 Cee 0.01074 Fancy 0 . 0 1 0 3 5 Cee 0 . 0 0 5 0 9 Source: P o o l C l o s i n g C i r c u l a r No.8 . B.C. Tree F r u i t L t d . , November 2 2 , 1 9 6 3 . APPENDIX I I TABLE XXI POOL RETURNS- FOR PEARS., 1963 CROPS Average Naked F r u i t Group P o o l V a r i e t y Grade R e t u r n ( $ / l b ) 1 Dr. J u l e s Comb. .0423:8 2 B a r t l e t t F L . 0 5 3 6 3 s . 0 4 3 6 3 Cannery F L . 0 5 3 6 3 s. . 0 4 3 6 3 C L . 0 3 5 8 2 S .02708 Cannery C L . 0 3 5 8 2 S . 0 2 7 0 8 Comb. . 0 5 0 1 2 "L. M a t u r i t y " F L .03486 S, . 0 2 8 3 6 C L .02328 S . 0 1 7 6 0 Comb. .03241 Q u a l i t y C o n t r o l . 0 0 2 5 3 F l e m i s h EFL . 0 2 5 1 5 Cannery EFL . 0 2 5 1 5 FL . 0 2 2 9 3 Cannery FL . 0 2 2 9 3 5 Seaso n Anjous EFL . 0 5 0 9 7 M . 0 6 5 8 6 s . 0 6 3 6 7 xs. . 0 5 9 2 0 u n s i z e d .06140 FL .04319 M .05808 S . 0 5 5 8 6 XS .05142 U n s i z e d .05421 CL .02698 M .03142 U n s i z e d . 0 3 0 7 2 Commercial U n s i z e d . 0 5 4 7 7 " L o c a l Mat." EFL .03313 11 M .04281 11 S .04137 11 FL .02807 » M . 0 3 7 7 5 » s . 0 3 6 3 1 " CL .01754 " M .02042 c o n t 1 d 126 ' - -APPENDIX II TABLE XXI ....cont 1d. Group Pool 4 Season Season Variety Bosc Winter N e l l i s Grade FL S, Unsized CL F C Average Naked F r u i t Return ($/lb) .03691 .02387 .03586 .01460 .04835 .02613 Source: Pool Closing C i r c u l a r s No.9 and No. 10. B.C. Tree F r u i t s Ltd., 1963. APPENDIX I I TABLE X X I I POOL RETURNS FOR PEACHES, 1 9 6 3 CROP Group 1 R o c h e s t e r & S p o t l i g h t P o o l A t o A u g . l P o o l B Aug .2-8 P o o l 1 Aug.9-10 P o o l 2 Aug.11 Sejt .17 Group 2 Red Haven P o o l A t o A u g . l P o o l B Aug.2-8 Grad.d and S i z e P o o l 2 Aug.11 -Se p t . 1 7 N o . l No.2 N o . l No. 2 N o . l No.2 N o . l No.2 N o . l No.2 N o . l No. 2 L S L S L S. L S L S. L S L S L S L S L S L S L S P o o l 1 Aug.9-10 N o . l L S No.2 L L S N o . l No.2 Cannery Bonus L S L S Average Naked F r u i t R e t u r n ( $ / l b ) .05144 .04144 .04287 .03287 . 0 5 0 2 1 .04021 .04164 .03164 .04623 . 0 3 6 2 3 .03766 .02766 . 0 3 7 0 5 . 0 2 7 0 5 .02848 .01848 .05916 .04916 . 0 5 0 5 9 .04059 .06061 . 0 5 0 6 1 .05204 .04204 .06053 . 0 5 0 5 3 . 0 5 1 9 6 .04196 . 0 5 0 7 3 .04073 .04216 .03216 .04835 . 0 0 2 3 8 ,...cont *d, APPENDIX I I TABLE X X I I ..cont f d Group 3 J u b i l e e S eason Grade and S.ize N o . l L S. Cannery Bonus Average Naked F r u i t R e t u r n ( $ / l b ) .04281 .03281 .04162 .00119 Group 4 V s e t c . P o o l 1 t o Aug.10 P o o l 2 Aug.11 -Sept.17 P o o l 3 Sept.17 on N o . l L S No.2 L S Cannery Bonus N o . l L 3 S, No.2 L S Cannery6 "Bonus Cannery Bonus . 0 5 0 7 5 .04075 .04218 .03218 .04956 . 0 0 1 1 9 .04276 . 0 3 2 7 6 .03419 .02419 .04157 . 0 0 1 1 9 .04157 . 0 0 1 1 9 Group 5 E l b e r t a P o o l 2 Aug. 1 1 -S e p t . 1 7 N o . l L l , S No.2 L S Cannery 2 Bonus .04013 . 0 3 0 1 3 . 0 3 1 5 6 . 0 2 1 5 6 . 0 3 8 3 5 . 0 0 1 7 8 P o o l 3 S e p t . 1 8 on N o . l No.2 L S L a Cannery Bonus .04013 .03013 .03156 .03835 .00178 Group 6 J.H.Hales P o o l 2 Aug. 1 1 -S e p t . 1 7 N o . l No.2 L 'S L a . 0 6 1 2 1 . 0 5 1 2 1 . 0 4 9 7 8 . 0 3 9 7 8 APPENDIX I I TABLE XXII . . . . c o n t 1 d . Grade and S i z e P o o l 3 Sept.18 on No.l No.2 Group 7 C l i n g s t o n e P o o l A t o Aug.,1 No.l No.2 P o o l B Aug.2-8 N o . l No.2 Average Naked F r u i t R eturn ( $ / l b ) L .06121 L .04978 L .05199 S .04199 L .04342 S .03342 L .04945 s .03945 L .04088 s .03088 Source: P r e l i m i n a r y P o o l C l o s i n g C i r c u l a r No.7, B.C.Tree F r u i t s L t d . Nov. 18, 1963. APPENDIX I I TABLE XXIII POOL RETURNS: FOR COOKERS,, 1963 CROP Group V a r i e t y P o o l Dates Grad 1 Transparent 1 t o J u l y 18 Cee e t c . 2 J u l y 19-25 Cee 3 J u l y 26-30 Cee 4 J u l y 31-on Cee 2 Duchess e t c . 1 t o Aug. 5 Cee 2 Aug.6-12 Cee 3 Aug.13-on Cee 3 Other Cookers 1 to J u l y 18 Cee 2 J u l y 19-25 Cee 3 J u l y 26-30 Cee 4 J u l y 31-on Cee 4 Wealthy e t c . 1 t o Aug.20 Cee 2 Aug ..21 -Sept Cee 3 Sept.11-on Cee 5 Rob Roy S.e as on EF F C 6 Tydeman Red Season EF F G CRESTON DISTRICT 1 Transparent A to J u l y 31 Cee e t c . B Aug.1-5 Cee C Aug.6-on Cee 2 Duchess e t c . A t o Augu 12 Cee B Aug.13-19 Cee C Aug.20-on Cee Average Naked F r u i t Return ( $ / l b ) .0 5535 .05111 .04796 .03438 .04520 .03925 .01881 .04841 .04417 .04102 .02744 .03267 .02712 .01412 .07292 .06542 .05042 .07269 .06519 .05019 .02069 .01665 .01283 .03895 .02767 .01562 ....cont'd. APPENDIX I I TABLE XXIII ,...cont'd Group V a r i e t y 3 Wealthy 4 Rob Roy Average Naked P o o l Dates Grade F r u i t Return ($./lb) A t o Aug.,29 Cee .02419 B Aug .30-Sep. 16 Cee .01864 C S e p t . l 7 - o n Cee .01412 S.e as on EF .07339 F .06589 c .05089 Sources P r e l i m i n a r y P o o l C l o s i n g C i r c u l a r No.4. B.C. Tree F r u i t s L t d . , Nov.1,1963. APPENDIX I I I TABLE XXIV SPATIAL DISTRIBUTION OF REGULATED FRUIT BI WEIGHT, 1963 CROP. Apples (40 lbs) (fresh and processed) Pears (45 lbs) ( f r e s h ) Crab Apples (38 lbs) (fresh) Prunes (17 lbs) (fresh) Group L o c a l i t y W.C. E.C 9 Canada Edmonton Calgary Regina Saskatoon Winnipeg Vancouver Kootenay Other B.C.Points Quantity 43,973 336,430 275,423 209,918 541,807 629,999 24,687 65,424 To t a l Western Canada 2 , 5 5 7 , l6 l Montreal Toronto Ottawa Quebec New Brunswick Nova S c o t i a P r i n c e Edward Newfoundland Is l a n d T o t a l E a s t e r n Canada T o t a l Canada 119,728 294,185 17,555 4 9 , 9 4 1 14,825 5,962 80,570 582,766 U.S. T o t a l U n ited S t a t e s 1 ,428 ,698 O f f s h o r e U n i t e d Kingdom .. P a c i f i c I slands Southeast A s i a South and C e n t r a l Am1 Caribbean Scandinavia Europe South A f r i c a Sundry T o t a l O f f s h o r e 875,717 25,144 36,793 50,988 66,177 211,051 73,790 6,300 1,345,960 fo Of R e g i o n a l Market % o f T o t a l Market 25 11 43 50 10 53 24 65 % o f % o f Regional T o t a l Q u a n t i t y Market Market 61,506 48,417 43,440 32,073 70,115 43,731 23 14 55 23 2,242 4,636 306,160 75,087 94,987 2,100 1 ,400 700 174,274 165,783 19,363 2,169 210 26,078 54 80 47,900 4 4 14 25 69 24 Quantity 9,520 2,642 7,788 4 ,224 3 ,490 2,608 13 303 30,162 1,036 78 75 1,189 % o f % of Regional T o t a l Market Market 32 87 30 8 96 3 Quantity 109,150 69,879 78,857 60,423 89,566 27,094 2,611 6,598 444,178 2,598 2,598 fo Of R e g i o n a l Market 25 % Of T o t a l Market 24 99 1 100 Grand T o t a l 5,914,585 694,117 446,776 12$ Plums (17 l b s ) ( f r e s h ) fo Of R e g i o n a l Quantity Market 2,223 1,948 955 912 747 716 82 984 fo Of T o t a l Market 26 8 Peaches (17.5 l b s ) ( f r e s h ) 8,557 100 Quantity 105,456 180,320 80,955 64,684 84,359 99,506 12,990 15,393 543,663 % Of % Of Regional Total Market Market 33 18 33 18 99 A p r i c o t s (15 l b s ) ( f r e s h ) C h e r r i e s ( 20 .5 l b s ) Quantity 30,957 47,743 27,358 20,198 26,216 31,159 1,681 4,111 166,423 % of Regional Market % of T o t a l Market 19 17 92 Quantity 28,082 26,007 20,046 16,733 36,971 20,662 928 3,051 152,480 % of % of Re g i o n a l T o t a l Market Market 24 14 10 73 ( l b s ) T o t a l Q u a n t i t i e s 26,695,937 21,017,309 16,853,494 12,821,179 28,768,909 30 ,372,040 1,577,425 3,359,577 140,042,579 T o t a l % of Reg i o n a l Market 19.0 15 12 9.0 20.4 21o4 1 .0 2 .2 fo Of T o t a l Market 9.1 9.8 10 .4 4 7 . 7 1,650 1,650 100 0.2 99.2 3,410 7,116 10,526 67 6 98 31,440 13,200 2,400 47,080 64 23 8,976,114 27.7 16,422,119 50.7 705,050 2.1 143,700 0.4 2,059,320 6 .4 624,500 2 .0 238,480 0.7 3,222,800 10. 32,394,223 3 . 1 5.6 1 .1 1 1 . 1 8,557 6,600 6,600 181,428 100 0 .8 0 .8 4,266 213 4,479 208,145 95 8,625 208,145 64,784,968 36,079,505 1,008,955 1,471,720 2,137,125 2,656,430 9,615,550 2,951,600 252,000 3,600 56,176,585 293,398,355 64.2$ 1.8 2 .6 3 .8 4 .7 17.1 5.3 0 .4 0 .1 22.1 12.3 3.3 1 .0 1 9 . 1 133 APPENDIX IV SUMMARY OF THE RECOMMENDATIONS FOR THE CONTROL OF . PRODUCTION OF REGULATED FRUIT BY THE AGRICULTURAL CLUB, 1963 AND 1964 CROP YEARS. For For 1963 1964 x b / / b / / b / / to / / b / b / b / / and c b / V a r i e t y C h e r r i e s (Royal Anne, Deacon, B l a c k T a r t a r i a n ) A p r i c o t s (Canning grades) T i l tons F r e s h A p r i c o t s Peaches ( E l b e r t a s ) Peaches (Vees) Prunes Pears (D'Anjou. B a r l e t t s ; Apples (S.tayman) Re c omme nd at i on No new p l a n t i n g New plant ing i n s e l e c t e d areas No new p l a n t i n g E l i m i n a t i o n ( e s p e c i a l l y i n l a t e maturing areas) Fu r t h e r p l a n t i n g 1 but on a limited., s a l e and i n the most f a v o u r a b l e l o c a t i o n s . No new p l a n t i n g Re as on L i m i t e d demand Short supply E x c e s s i v e supply Too l a t e h a r v e s t i n g date Demand be i n g s a t i s f i e d No demand E l i m i n a t i o n ( a r e a : No around Kaleden) demand New p l a n t i n g ( a r e a s : e a r l y maturing Short d i s t r i c t s supply ....cont'd. APPENDIX IV cont'd.. For For 1963 1964 V a r i e t y Re commend at i o n Re as on b / and c Newtown b / and c / b b / / a,b / ai d c b / b and c b / / a,b,c M a i n t a i n present Steady p r o d u c t i o n l e v e l . demand A d d i t i o n a l p l a n t i n g i n a r e a s where peren-n i a l canker i s e f f e c t -i v e l y c o n t r o l l e d . M n e s a p s No new p l a n t i n g s . E l i m i n a t i o n i n m a r g i n a l areas / / / / / Crab apples No new p l a n t i n g Plums No new p l a n t i n g F l e m i s h Immediate E l i m i n a -t i o n Cookers New p l a n t i n g s t o areas w i t h J u l y h a r v e s t i n g dates l i n t e r Apples No new p l a n t i n g (Regular D e l i c -ious) Golden D e l i c i o u s Any new p l a n t i n g o n l y i n the most fa v o u r a b l e areas L i m i t e d p l a n t i n g No new p l a n t i n g Red Romes Rome (Beauty) E l i m i n a t i o n r e f e r to items mentioned at the beginning of the s e c t i o n on p r o d u c t i o n c o n t r o l . High l o c a l p r o d u c t i o n and h i g h f o r e i g n product i o n L i m i t e d demand L i m i t e d demand D i f f i c u l t y i n f i n d i n g new markets No meet s e a s o n a l demand Demand sa t u r a t e d Demand f o r q u a l i t y product i n market United S t a t e s market s a t u r a t e d Too h i g h a pro-p o r t i o n of Cee grades. Source: Q u a r t e r l y Report of BCF&A, Kelowna, V I I and V I I I , Dec. 1962 and 1963. APPENDIX V 135-REGULATED FRESH FRUIT PRICES, SELECTED DATES, 1963 -1964 CROP SEASON C h e r r i e s P r i c e L i s t as at J u l y 1 1 t h 1 9 6 3 . Bings,Lamberts,Vans,Sams and S t a r r s No.l O.R. De a c ons, Wind s or s and Bl a c k V e l v e t s To B.C. To A l b e r t a,Saskat ch-(F.o.b) ewan,Manitoba and Western O n t a r i o ( d e l i v e r e d ) 6 . 1 5 6 .50 5 . 9 0 6 . 2 5 No.l O.R. 5 . 1 5 4 . 9 0 5 .50 5 . 2 5 J u l y 1 8 t h B i n g s , Lamberts, Vans,Sams and S t a r r s N o . l 4 . 9 0 5 . 2 5 O.R. 4 . 6 5 5 . 0 0 Deacons, Windsors and B l a c k V e l v e t s No.l 4 . 1 5 4 . 5 0 O.R. 3 . 9 0 4 . 2 5 .cont'd. APPENDIX V A p r i c o t s P r i c e L i s t as at J u l y 18th 1963. ' To B.C. To Alberta,Saskatch-(F.o.b.) ewan, Manitoba and Western O n t a r i o ( d e l i v e r e d ) No. 1 Vu-pakk 1.70 2.00 J u l y 29 No. 1 Vu-pak 1.70 2.00 Plums P r i c e l i s t as at J u l y 29th To other To Sask., To Peace A l b e r t a Man. ,W.0nt. To B.C. R i v e r Area Markets ( d e l i v -( F.o.b.) (F.o.b.) ( d e l i v e r e d ) ered) No. 1 Vu-pak 1.45 1.45 1.75 1.85 J u l y 31st No. 1 Vu-pak 1.45 1.45 1.75 1.85 1 3 7 APPENDIX V Prunes P r i c e l i s t as at Aug.22nd,1963. Vu-pak Domestic To BC (Fob) To Peace R i v e r Area ;(Fob) 1 . 5 0 1 . 5 0 To other To Sask- To Man.and A l b e r t a atchewan I . O n t a r i o Markets ( d e l i v - ( d e l i v -( d e l ' d) ered) 1 . 8 5 1 . 9 5 ered) 1 . 9 5 September 1 7 Vu-pak Domestic 1 . 5 0 1 . 5 0 1 . 8 5 1 . 9 5 1 . 9 5 Peaches P r i c e l i s t as at Aug.14th, 1 9 6 3 . Red Havens No.l 1 . 7 5 1 . 7 5 No.2 1 . 6 0 1 . 6 0 V e e s , J u b i l e e s , H a l e s Havens and other Freestones N o . l 1 . 6 5 1 . 6 0 No.2 1 . 5 0 1 . 4 5 Rochesters,Spot-l i g h t and D e l i c o u s No.l 1 . 5 0 1 . 4 5 No.2 1 . 3 5 ! . 3 0 2.10 1 . 9 5 1 . 9 5 1 . 8 0 1 . 8 0 1 . 6 5 2 . 2 0 2 . 0 5 2 . 0 5 1 . 9 0 1 . 9 0 1 . 7 5 2 . 2 0 2 . 0 5 2 . 0 5 1 . 9 0 1 . 9 0 1 . 7 5 September 4 t h J.H .Hales and Candokas No.l 2 . 0 5 2 . 0 0 No.2 1 . 8 5 1 . 8 0 E l b e r t a s , V e e s , H a l e s Havens and other Freestones except J.H.Hales No.l 1 . 8 5 1 . 8 0 No.2 1 . 6 5 1 C 6 0 2 . 3 5 2 . 1 5 2 . 1 5 1 . 9 5 2 . 4 5 2 . 2 5 2 . 2 5 2 . 0 5 2 . 4 5 2 . 2 5 2 . 2 5 2 . 0 5 APPENDIX V 138. September 3rd J.H.Hales Candokas and To BC (Fob) 1.95 1.75 E l b e r t a s , V e e s , H a l e s Havens and other Freestones except J.H.Hales N o . l 1.75 No.2 1.60 To Peace R i v e r A r e a (Fob) 1.90 1.70 1.70 1.55 To other To Sask-A l b e r t a atchewan Markets ( d e l i v -( del'd) ered) 2.25 2.05 2.05 1.90 2.35 2.15 2.15 2.00 To Man. and W.Ontario ( d e l i v -ered) 2.35 2.15 2.15 2.00 CEab-Apples P r i c e l i s t as at Aug.22nd,1963 Transcendents Std .Box., Fey. 1.90 1.80 2.40 2.65 2.70 &td.Box,©60 1.70 1.60 2.20 2.45 2.50 J u n i o r , F e y . 1.20 1.15 1.50 1.65 1.65 J u n i o r Cee 1.10 1.05 1.40 1.55 1.55 Bagged,Fey,8/5s 2.30 2.20 2.80 3.05 3.10 September 17th Std.Box, Fey. Std.Box, Cee Ju n i o r , F e y . Junior,Cee Bagged,Fey. ,8 /5s Hyslops Std.Box, Fey. Std.Box, Cee J u n i o r , Fey. J u n i o r Cee Bagged,Fey,8/5s 1.90 1.80 2.40 2.65 2.70 1.70 1.60 2.20 2.45 2.50 1.20 1.15 1.50 1.65 1.65 1.10 1.05 1.40 1.55 1.55 2.30 2.20 2.80 3.05 3.10 2.20 2.10 2.70 2.95 3.00 2.00 1.90 2.50 2.75 2.80 1.40 1.35 1.70 1.85 1.85 1.30 1.25 1.60 1.75 1.75 2.60 2.50 3.10 3.35 3.40 139 APPENDIX V Pears To BC (Fob) To Peace R i v e r Area (Fob) P r i c e l i s t as at Nov.6th, 1963 Anj ous Ex.Fey.Std.Box 90s - 150s Fey.Std.Box,80 L Fey.Std.Box,90s - 150s Cee,Std.Box 80s Cee,Std.Box 90s - 135s Cee,Uupak,30s -55s 23rd December Ex.Fey.Std.Box 90s - 150s Fey .Std.Box, 80 L Fc.Std.Box,90s - 150s Cee,Std.Box 80s Cee,Std.Box 90s - 135s Cee,Uupak,30s -55s 21st January, 1964 Cee,Std.Box 80s Cee,Std.Box 90s -135s To other A l b e r t a Markets (del'd) To Sask-atchewan ( d e l i v -ered) To Man.and W.Ontario ( d e l i v -ered) 4.45 5.25 4.45 5.15 4.35 5.90 5.10 6.20 5.40 6.20 4.10 4.90 4.00 4.80 4.75 5.55 5.05 5.85 5.05 5.85 3.50 3.75 3.40 3.65 4.15 4.40 4.45 4.70 4.45 4.70 1.65 1.60 1.90 2.00 2.00 1.75 1.70 2.00 2.10 2.10 4.45 5.25 4.35 5.15 5.10 5.90 5.40 6.20 5.40 6.20 4.10 4.90 4.00 4.80 4.75 5.55 5.05 5.85 5.05 5.85 3.50 3.75 3.40 3.65 4.15 4.40 4.45 4.70 4.45 4.70 1.65 1.60 1.90 2.00 2.00 1.75 1.50 1.80 1.90 1.90 3.50 3.75 3.40 3.65 4.15 4.40 4.45 4.70 4.45 4.70 1.55 1.50 1.80 1.90 1.90 114.0! - r* APPENDIX V Apples To Peace To other To Sask- To Man.and To BC R i v e r Area A l b e r t a atchewan W.Ontario (fob) (fob) Markets ( d e l i v - ( d e l i v -( d e l f d ) ered) ered) P r i c e l i s t as at Nov.20th, 1963. Mcintosh E x . F e y . C e l l 96s-140s 3.85 3.75 4.30 4.30 4.20 F e y . C e l l 84s-140s 3.40 3.30 3.85 3.85 3.75 C e e , C e l l 96s-140s 2.80 2.70 3.25 3.25 3.15 Ex.Fey. Jr.45s-64s 2.00 1.95 2.20 2.20 2.15 Fey.3/6 qt.baskets 1.75 1.70 2.00 2.00 1.95 Fey.Jr.45s - 64s 2.25 2.20 2.50 2.35 2.20 Fey.Bagged 8/4s 2.95 2.85 3.20 3.00 2.60 Handipak,Commercial 1.40 1.45 1.70 1.60 1.55 Cee,Uupak 35s-50s 1.25 1.20 1.45 1.45 1.45 Spartans Ex.Fey.Tray 72/L E x . F e y . C e l l 84s-140s Fey.Tray 72/L F e y . C e l l 84s-140s Cee,Tray 72/L C e e , C e l l 84s-l60s Hand ipak,Comme r c i a l Spartans t o E a s t e r n Canada Ex.Fey.Tray 72/L 2.85 f.o.b. E x . F e y . C e l l 84s-140s 3.35 f.o.b. F e y . C e l l 84s-140s 2.90 f.o.b. C e e , C e l l 84s-l60s 2.50 f.o.b. Golden D e l i c i o u s E x . F e y . C e l l 72s-80s E x . F e y . C e l l 96s-140s F e y . C e l l 72s-80s F e y . C e l l 96s-140s Cee,Tray 88/L Cee,Tray 100-l63s Golden D e l i c i o u s t o E a s t e r n Canada E x . F e y . C e l l 60s-70s 3-50 f.o.b. E x . F e y . C e l l 80s 4.00 f.o.b. E x . F e y . C e l l 96s-140s 4.50 f.o.b. 3.35 3.25 3.80 3.80 3.70 3.85 3.75 4.30 4.30 4.20 2.90 2.80 3.35 3.35 3.25 3.40 3.30 3.85 3.85 3.75 2.55 2.45 3.00 3.00 3.00 2.95 2.85 4.00 3.40 3.30 1.50 -• - - -4.50 4.40 5.05 5.35 5.35 5.00 4.90 5.55 5.85 5.85 4.10 4.00 4.65 4.95 4.95 4.60 4.50 5.15 5.45 5.45 3.00 2.90 3.55 3.85 3.85 3.35 3.25 3.90 4.20 4.20 H|.i APPENDIX V Apples To Peace To other To Sask- To Man.and To BC R i v e r Area A l b e r t a atchewan W.Ontario (fob) (fob) Markets ( d e l i v - ( d e l i v -( d e l ' d ) ered) ered) Red D e l i c i o u s Ex.Fey.Tray 8 8/L or 3 . 7 5 3 . 6 5 4 . 3 0 4 . 6 0 4.60 C e l l 80/L Ex.Fey.Tray 100s - 1 5 0 s 3 . 7 5 3 . 6 5 4 . 3 0 4 . 6 0 4 . 6 0 or C e l l 9 6 s-140s Fey.Tray 88/L or C e l l 3 . 2 5 3 . 1 5 3.80 4.10 4.10 80/L Fey.Tray 1 0 0 s - l 5 0 s or 3 . 2 5 3 - 1 5 3 . & 4.10 4.10 C e l l 9 6 s-140s Fey.Bagged 10/4s 3 . 5 0 3.40 3 . 9 5 4.20 4.20 Handipak,Fey 1 . 6 5 - • — Cee,Uupak , 3 5 s - 5 0 s 1 . 2 5 1.20 1.45 1 . 6 0 1 . 6 0 Red D e l i c i o u s t o E a s t e r n . Canada Ex.Fey.Tray 1 5 0/L and C e l l 140/L 3.40 f . o . b . Fey.Tray 1 2 5/L and. C e l l 120/L 3 . 0 0 f.o.b. Fey,Tray 1 3 8 s - l 5 0 s and C e l l 140s 2 . 7 5 f.o.b. Fey.Bagged 10/4s 3 . 2 5 f.o.b. D e l i c i o u s Ex.Fey.Tray 88/L or 3 . 2 5 3 . 1 5 3.80 4.10 4.10 C e l l 80/L Ex.Fey.Tray 1 0 0 s - l 5 0 s 3 . 2 5 3 . 1 5 3.80 4.10 4.10 or C e l l 9 6 s-140s Fey.Tray 8 8/L or C e l l 2 . 6 5 2 . 5 5 3.20 3 . 5 0 3 - 5 0 80/L Fey.Tray 100s - 1 2 5 s or 2.90 2 . 8 0 3 . 4 5 3 . 7 5 3 . 7 5 C e l l 96s-l20s Handipak,Fey. 1 . 5 0 1.45 1.70 1 . 8 5 1 . 8 5 Fcy.Uupak 3 5 s - 5 0 s 1 . 3 0 1 . 2 5 i.5o 1 . 6 5 1 . 6 5 D e l i c i o u s t o E a s t e r n Canada Ex.Fey.Tray 1 5 0/L or 3 . 0 0 f.o.b. C e l l 140/L Fey.Tray 1 2 5/L or C e l l 2 . 6 5 f.o.b. 1 2 0/L 114.2; APPENDIX V Apples To BC (fob) To Peace R i v e r Area (fob) To other A l b e r t a Markets (del'd) To Sask-atchewan ( d e l i v e r -ed) To Man.and L O n t a r i o ( d e l i v -ered) J u b i l e e Kandipak, Commercial 1.35 1.40 1.65 1.55 1.50 Romes Handipak,Fcy. 1,40 1.35 1.60 1.75 1.75 Red Romes E x . F e y . C e l l 84s-120s Fey.Tray 72/L F e y . C e l l 84s-120s C e e . C e l l 84s-l60s 3.50 3.00 2.00 2.60 3.40 3.40 2.90 2.50 4.00 3.50 3-50 3.10 4.25 3.75 3-75 3.35 4.25 3.75 3.75 3.35 Red Romes t o E a s t e r n Canada E x . F e y . C e l l 84s-96s E x . F e y . C e l l 120s Fey.Tray 72/L F e y . C e l l 84s-96s F e y . C e l l 120s C e l l , C e l l 84s-l60s Newt owns Ex.Fey.Tray 88/L or C e l l 84/1 Ex.Fey.Tray 100s-l25s or C e l l 96s-120s Fey.Tray 88/L or C e l l 84/L Fey.Tray 100s-125s or C e l l 96s-120s C e l l , T r a y 100s - 125s or C e l l 96s - 120s 3.50 f.o.b. 3.25 f.o.b. 3.00 f.o.b. 3.00 f.o.b. 2.75 f.o.b. 2.60 f.o.b. 3.50 3.75 3.15 3.40 2.85 February 5? 1964 Mcintosh F e y . C e l l 84s-120s Fcy.Uupak 35s-50s Cee,Uupak 35-50s 3.40 1.45 1.25 3.30 1.40 1.20 3.85 1.65 1.45 3.85 1.65 1.45 3.50 1.65 1.45 APPENDIX V Apples 143 To Peace To BC R i v e r Area (fob) (fob) Spartans Ex.Fey.Tray 72/L E x . F e y . C e l l 84s-l20s Fey.Tray 7 2/L F e y . C e l l 84s-140s Cee Tray 7 2/L C e e , C e l l 8 4 s - l 6 0 s 3 - 3 5 3 . 8 5 2 . 9 0 3.40 2 . 5 5 2 . 9 5 3.25 3.75 2.80 3.30 2.45 2.85 2 . 8 5 f.o.b, 2 . 5 0 f.o.b, Spartans t o E a s t e r n Canada Ex.Fey.Tray 7 2/L Cee C e l l 84s-l60s Golden D e l i c i o u s E x . F e y . C e l l 72s-80s E x . F e y . C e l l 96s-140s F e y . C e l l 72s-80s F e y . C e l l 96s-140s Cee,Tray 88/L Cee,Tray 100s - 160s Golden D e l i c i o u s t o E a s t e r n Canada E x . F e y . C e l l 60s E x . F e y . C e l l 72s E x . F e y . C e l l 80s E x . F e y . C e l l 96s-140s F e y . C e l l 60s F e y . C e l l 80s F e y . C e l l 96s-140s Red D e l i c i o u s Ex.Fey.Tray 88/L or C< 80/L Ex.Fey.Tray 100s-l50s or C e l l 96s-140s Fey.Tray 8 8/L or C e l l 80/L Fey.Tray 100s-138s or C e l l 96s-140s Fey.Bagged 10/4s Fey.3/6 qt.Baskets Handipak,Fey. Cee,Uupak 35s-50s 3.00 f.o.b. 3.50 f.o.b. 4.00 f.o.b. 4.25 f.o.b. 2.75 f.o.b. 3.65 f.o.b. 4.00 f.o.b. To other To Sask- To Man.and A l b e r t a atchewan I . O n t a r i o Markets ( d e l i v e r - ( d e l i v -( del'd) ed) ered) 3.80 3.80 3.70 4.30 4.30 . 4.20 3.35 3.35 3.25 3.85 3.85 3.75 3.00 3.00 3.00 3.40 3.40 3.30 3.90 3.80 4.45 4.75 4.75 4.40 4.30 4.95 5.25 5.25 3.50 3.40 4.05 4.35 4.35 4.00 3.90 4.55 4.85 4.85 3.00 2.90 3.55 3.85 3.85 3.35 3.25 3.90 4.20 4.20 L3.75 3.65 4.30 4.60 4.60 3.75 3.65 4.30 4.60 4.60 3.25 3.15 3.80 4.10 4.10 :3-25 3.15 3.80 4.10 4.10 3.50 3.40 3.95 4.20 4.20 2.25 2.20 2.50 2.50 2.50 1.65 — — — -1.25 1.20 1.45 1.60 1.60 APPENDIX V Apples To Peace To BC R i v e r Area (fob) (fob) Red D e l i c i o u s t o E a s t e r n Canada Ex.Fancy Tray 80/L or 3.10 f.o.b. C e l l 80/L Ex.Fey.Tray 88s-l50s or 3.40 f.o.b. C e l l 96s-120s Fey.Tray 125/L or C e l l 120ju 2.85 f.o.b. Fey.Tray 138s-15Gs or 2.75 f.o.b. C e l l 140 s Fey.Bagged 10/4s 2.85 f.o.b. To other A l b e r t a Markets (del'd) To Sask- To Man.and atchewan W.Ontario ( d e l i v e r - ( d e l i v -ed) ered) D e l i c i o u s Ex.Fey.Tray 88/L or 80/L Ex.Fey.Tray 100s -150s or C e l l 96s-140s Fey.Tray 88/L or C e l l 80/L Fey.Tray 100s-125s or C e l l 96s-120s Handipak,Fey. Fcy.Uupak 35s-50s D e l i c i o u s t o E a s t e r n Canada Ex.Fey.Tray 150/L or C e l l 140/L Fey.Tray 150/L or C e l l 160/L 3.25 3J5 3.80 4.10 4.10 3.25 3.15 3.80 4.10 4.10 2.65 2.55 3.20 3-50 3.50 2.90 2.80 3.45 3.75 3.75 1.50 1.45 1.70 1.85 1.85 1.30 1.25 1.50 1.65 1.65 2.80 2.65 Homes Ex.Fey.Tray 64s-72s 3.15 E x . F e y . C e l l 84s-120s 3.25 Fey . C e l l 64s-72s.; 2.75 F e y . C e l l 84s-120s 2.75 Handipak, Fey. 1.40 f.o.b, f.o.b, 3.05 3.15 2.65 2.65 1.35 3.65 3.75 3.25 1,60 3. 90 4.00 3.50 3.50 1.75 3.90 4.00 3.50 3.50 1.75 Red Romes Cee, C e l l 84s-l60s 2-.60 f.o.b, " A. O APPENDIX V Apples To Peace To other To BC R i v e r Area A l b e r t a Newtowns ExFcy.Tray 8 8/L Ex.Fey.Tray 1 0 0 s - 1 2 5 s Fey.Tray 8 8/L Fey.Tray 1 0 0 s - 1 2 5 s Cee,Tray 8 8/L Cee,Tray 1 0 0 s - 1 2 5 s Hand ipak,Ex.Fey. Fey.Bagged 8 / 4s Red S/taymans Ex.Fey.Tray 8 0 s - 8 8 s Ex.Fcy.Tray 1 0 0 s - 1 3 8 s Fey.Tray 8 0 s - 8 8 s Fey.Tray 1 0 0 s - 1 3 8 s l i n e s a p s Ex.Fcy.Tray 8 8/L Ex.Fcy.Tray 1 0 0 s - 1 3 8 s Fey.Tray 8 8/L Fey.Tray 1 0 0 s - 1 3 8 s Fcy.Uupak 3 5 s - 5 0 s Cee,Uupak 3 5 s - 5 0 s Ex.Fey.Bagged 1 2 / 3 5 (fob) (fob) 3 . 1 5 3 . 5 0 2 . 8 5 3 . 1 5 2 . 5 0 2 . 7 5 1 . 3 0 2 . 8 0 3 . 0 5 3.40 2 . 7 5 3 . 0 5 2.40 2 . 6 5 1 . 2 5 2 . 7 0 Markets (del'd) To Sask-atchewan ( d e l i v e r -ed) To Man.and W.Ontario ( d e l i v -ered) 3 . 7 0 4 . 0 0 4 . 0 0 4 . 0 5 4 . 3 5 4 . 3 5 3.40 3 . 7 0 3-70 3 . 7 0 4 . 0 0 4 . 0 0 3 . 0 5 3 . 3 5 3 . 3 5 3 . 3 0 3 . 6 0 3 . 6 0 1 . 5 0 1 . 6 5 1 . 6 5 3 . 1 5 3 . 3 5 3 . 3 5 2 . 6 5 2 . 5 5 3 . 2 0 3 . 5 0 3 . 5 0 3 . 0 0 2 . 9 0 3 . 5 5 3 . 8 5 3 . 8 5 2 . 4 5 2 . 3 5 3 . 0 0 3 . 3 0 3 . 3 0 2 . 7 5 2 . 6 5 3 . 3 0 3 . 6 0 3 . 6 0 3 . 5 5 3 . 2 5 3 . 9 0 4 . 2 0 4 . 2 0 3 . 3 5 3 . 2 5 3 . 9 0 4 . 2 0 4 . 2 0 2 . 7 5 2 . 6 5 3 . 3 0 3 . 6 0 3 . 6 0 2 . 7 5 2 . 6 5 3 . 3 0 3 . 6 0 3 . 6 0 1 . 2 5 1 . 2 0 1 . 4 5 1 . 6 0 1 . 6 0 1 . 1 0 1 . 0 5 1 . 3 0 1 . 4 5 1 . 4 5 3 . 1 5 3 . 0 5 3 . 6 0 3 . 8 5 3 . 8 6 Source; P r i c e L i s t s , B.C. Tree F r u i t s L t d . , 1963-64 -I / -} 12+6 APPENDIX V I TABLE XXV APPLES., SUPPLIES. AND DISTRIBUTION, CANADA 1954- - 1?&3 ('000 b u s h e l s ) P r o d u c -Y e a r t i o n Imports T o t a l F r e s h P r o -S u p p l y E x p o r t s cessed Waste A v a i l a b l e f o r Dom-e s t i c Use 1954 1955 1956 1957 1958 1959 i960 1961 1962 1963 14,500 19,142 12,424 15,630 17,006 15,517 14,914 16,521 20,049 22,798 1,018 738 1,035 1,427 957 1,186 1,158 1,418 822 820 15,518 19,880 13,459 17,057 17,963 16,703 16,072 17,939 20,871 23,618 2,168 2.955 1,468 3,046 2,309 2,137 2,371 2,538 3,121 3,757 5,036 4,679 3.702 4,551 4,594 5,025 4,019 5,177 5,916 7,417 1,944 2,930 1,796 2,287 2,530 2,157 2,237 2,340 2,868 3,H7 6,370 9,316 6,493 7,173 8,530 7,384 7,445 7,884 8,966 9,327 X E s t i m a t e d at 20$ o f p r o d u c t i o n f o r f r e s h use and 5% f o r i m p o r t s , S o u r c e : L.E. D r a y t o n , u n p u b l i s h e d m a t e r i a l , 1964. APPENDIX VI TABLE XXVa ESTIMATES- OF PER CAPITA DISAPPEARANCE, FRESH APPLES WESTERN CANADA, 1954 - 1963 Western Can- Estimates a d i a n S a l e s o f t o t a l by BC Tree % of Western Year F r u i t s L t d . B.C. Sales ('000 std.Pack- C a r l o t . ('000,000 ages o f 41 l b s r Unloads^ l b s ) Popula-t i o n Wester Canada ('000) Per C a p i t a Consump-t i o n l b s / C a p i t a ( a l l apples)^ Per C a p i t a Consump-t i o n l b s / C a p i t a ( l o -cal appQes)cj 1954 1955 1956 1957 1958 1959 I960 1961 1962 1963 2,279 2,266 1,997 2,618 2,687 1,838 2,099 1,796 2,334 2.557 84.5 84.2 79.6 85.5 81.7 65.2 74.3 57.0 74.3 79.9 110.577 110.331 102.869 125.542 134.849 115.579 115.825 129.191 128.781 131.200 4,075 4,179 4,284 4,417 4,543 4,647 4,750 4,845 4,933 5,022 27.14 26.40 24.01 28.42 29.68 24,87 24,38 26.66 26.11 26.13 22.93 22.23 19.11 24.30 24.25 16.22 18.12 15.20 19.40 20.88 Source; 1 B.C.Tree F r u i t s L t d . , Records 1963-1964. 2 Canada, Department of A g r i c u l t u r e , Crop and Seasonal Summaries, P r o d u c t i o n and Marketing Branch, 1954 - 1964 3 For non-census and I n t e r c e n s a l y e a r s , estimates of p o p u l a t i o n were obtained by e x t r a p o l a t i o n . 11+8 APPENDIX VI TABLE XXVI ESTIMATES, OF PER CAPITA DISAPPEARANCE, FRESH APPLES, EASTERN CANADA, 1954-1963 E a s t e r n S a l e s B . C T r e e ( a l l s u p p l y - F r u i t s i n g areas) L t d . S a l e s ('000,000 ('000,000 Year l b s ) l b s ) 1954 176.073 21.320 1955 308.889 16.523 1956 189.316 8.815 1957 197.243 20.541 1958 249.001 19.311 1959 216.701 10.701 1960 219.200 13.818 1961 225.589 6.109 1962 274.689 12.587 1963 288.515 23.903 Per Per C a p i t a C a p i t a P opula- . Consump- Consump-t i o n t i o n l b s / t i o n l b s / E a s t e r n c a p i t a c a p i t a Canada ( a l l ( l o c a l ('000) apples )X-j_ a p p l e s ) X 1 11212 15.70 1.9Q 11519 26.82 1.43 0.75 11797 16.05 12172 16.21 1.69 12512 19.90 1.54 12836 16.88 Q.83 13120 16.71 1.05 13393 16.84 0.46 13637 20.14 0.92 13892 20.77 1.72 Sources As i n Table XXV APPENDIX VI TABLE XXVII WHOLESALE PRICES OF (Pg)APPLES, PER CAPITA DISPOSABLE INCOME (X^) AND NET PER CAPITA DISPOSABLE INCOME WESTERN CANADA AND EASTERN CANADA, 1954 -- 1963 Western E a s t e r n Year Canada Canada P2 ( c e n t s ) (cefits) c«? X < 3 ( t r 1954 10.11 8.02 9 5 6 9 1 1 1 9 5 5 8 . 9 0 6.12 9 9 8 9 5 2 1 9 5 6 11.08 8.44 1 0 6 1 9 9 2 1 9 5 7 9 . 2 9 7.14 1057 9 9 3 1 9 5 8 9 . 0 7 6 . 5 6 1073 ^ 9 9 6 1 9 5 9 9 . 5 6 6.74 1083 1021 I960 11.22 8 . 2 8 1095 1028 1961 10 .27 7 . 1 3 1103 1039 1962 9 . 7 9 7.45 1 1 5 7 1 0 6 1 1963 9 . 1 5 7.43 1 1 6 6 1 0 7 1 Wholesale p r i c e s ( P 2 ) were d e f l a t e d w i t h the Wholesale P r i c e Index, Canada (1949 = 100) Disp o s a b l e Income F i g u r e s (X^ and X'^) were d e f l a t e d wi The Canada Consumer P r i c e Index (1949 s 100) Source: Canada, Department of A g r i c u l t u r e Crop and , I b i d . . Canada Year Book,1954-1963. APPENDIX VI TABLE XXVIII. PER CAPITA CONSUMPTION OF B.C.TREE FRUITS LTD.SALES OF FRESH APPLES (X.^ , WHOLESALE PRICES OF APPLES ( P 2 ) PER CAPITA DISPOSABLE INCOME (X^) AND NET PER CAPITA DISPOSABLE INCOME ( X « ) ; VANCOUVER 1954 - 1963 Year \ P 2 X 3 A 3 1954 28.24 8 . 2 7 946 901 1 9 5 5 3 0 . 5 0 7.84 986 940 1956 2 5 . 1 8 9.87 1048 979 1957 2 9 . 7 2 8 . 3 8 1051 987 1958 35.94 7.10 1068 9 9 2 1 9 5 9 24 .99 8.37 1071 1010 I960 2 6 . 6 5 9.97 1087 1020 1961 2 7 . 5 8 8 . 7 2 1101 1038 1962 33.54 9.64 1165 1069 1963 3 2 . 0 5 8 . 9 0 1179 1085 Wholesale P r i c e s ( P 2 ) were d e f l a t e d w i t h the Wholesale P r i c e Index, Canada (1949 « 100) D i s p o s a b l e Income F i g u r e s were d e f l a t e d w i t h the Vancouver Consumer P r i c e Index (1949 =» 100) Source5- As i n Table XXV APPENDIX V I TABLE XXIX PER CAPITA CONSUMPTION OF B.C.TREE FRUITS LTD.SALES OF FRESH APPLES (X]_), WHOLESALE PRICES OF APPLES. ( P 2 ) PER CAPITA DISPOSABLE INCOME (X« ) TORONTO, 1954-1963 Year x l P 2 X 3 X« 1954 4 . 3 8 1 1 . 3 7 9 3 9 894 1 9 5 5 2 . 9 3 9 . 9 7 978 933 1 9 5 6 1.36 1 2 . 5 5 1 0 3 9 971 1 9 5 7 4 . 5 6 9 . 9 2 1 0 2 9 966 1 9 5 8 3.89 9.81 1044 9 6 9 1 9 5 9 2 . 5 7 10.00 IO63 1002 I960 3.94 1 1 . 6 1 1 0 7 5 1 0 0 9 1961 1.68 1 2 . 5 1 1086 1024 1962 3.49 1 1 . 1 5 1142 1048 1963 6 . 3 0 1 0 . 2 5 1 1 5 3 1061 3 W h o l e s a l e P r i c e s ( P 2 ) were d e f l a t e d w i t h t h e Wholesale P r i c e Index, Canada (1949 = 1 0 0 ) . D i s p o s a b l e Income F i g u r e s (X^ and X 1^) were d e f l a t e d w i t h the T o r o n t o Consumer P r i c e Index (1949 - 100) S o u r c e : As I n T a b l e XXV I20r August September October Dates of Shipment Graph 15. B.C. Tree Fruits Ltd. regional shipments and f o b prices of all fresh prunes, 1963 crop, British Columbia. 153 APPENDIX V I I 1600 r August September October Dates of Shipment Graph 16. B.C. Tree Fruits Ltd. shipments and delivered prices, all fresh prunes, 1963 crop, Western Canada. APPENDIX V I I Sept. 7 II 14 18 21 2 5 2 8 Dates of Shipment Graph 17. B.C. Tree Fruits Ltd. regional shipments and delivered pr ices , all fresh prunes, 1963 c rop , Eastern Canada. » APPENDIX V I I 120 r cherry supply 1 8 0 H 6 0 4 0 -O A 2 0 2 2 2 6 2 9 3 6 June Ju ly 10 13 18 2 0 2 4 2 7 31 V O Dates of Shipment Graph 18. B.C.Tree Fruits Ltd. regional sh ip-ments and f.o.b. prices , al l f resh cher r ies , 1963 crop, Br i t ish Columbia. APPENDIX V I I 450 r June July August Dates of Shipment Graph 19. B.C. Tree Fruits Ltd. regional shipments and delivered prices, all fresh cherries, 1963 crop, Western Canada. APPENDIX V I I 140 r — apricot supply - i25 10 13 18 20 24 27 31 3 7 10 14 J u l y Augus t Dates of Shipment Graph 20. B.C. Tree Fruits Ltd. regional shipments and f.o.b. p r i ces ,a l l fresh apr ico ts , 1963 c rop , B r i t i sh Co lumb ia . •: : 1 5 9 ' APPENDIX V I I 5 5 0 r July August Dates of Shipment Graph 21. B.C. Tree Fruits Ltd. regional shipments and delivered prices, all fresh apricots, 1963 crop Western Canada. 6 r July August September Dates of Shipment Graph 22. B.C. Tree Fruits Ltd. regional shipments and f.o.b. prices,all fresh plums, 1963 crop, British Columbia. H OX /PPEHDIX V I I I 6 r July August September October Dates of Shipment Graph 23. B.C. Tree Fruits Ltd. regional shipments and delivered prices, all fresh plums , 1963 crop, Western Canada. 3 0 0 r July August September Dates of Shipment Graph 24. B.C.Tree Fruits Ltd. regional shipments and f.o.b. prices all fresh peaches, 1963 crop, British Columbia. « -263 APPENDIX V I I 27 31 3 7 10 14 17 21 24 28 31 4 7 II 14 18 21 25 July August September Dates of Shipment Graph 25. B.C. Tree Fruits Ltd. regional shipments and delivered prices, all fresh peaches, 1963 crop, Western Canada. . •, J164: . ; APPENDIX V I I Graph 26. B.C. Tree Fruits Ltd. regional shipments and f.o.b. prices, all fresh crab-apples, 1963crop, British Columbia. APPENDIX V I I August September October Dates of Shipment Graph 27. B.C.Tree Fruits Ltd. regional shipments and delivered prices, all fresh crab-apples, 1963 crop, Western Canada. 166.-APPENDIX V/II 18 r August September October Dates of Shipment Graph 28. B.C. Tree Fruits Ltd. regional shipments and delivered p r i ces , all fresh c r a b - a p p l e s , 1963 c rop , Eastern Canada. 160 140 k August'63 September October November December January'64 February March Dates of Shipment Grdph 29. B.C. Tree Fruits Ltd. regional shipments and f.o.b. prices, all fresh pears, 1963 crop, British Columbia. I S Os -v] > I 200 Dates of Shipment Graph 30. B.C. Tree Fruits Ltd. regional shipments and delivered prices,all fresh pears, 1963 crop, Western Canada. Co 700r Dates of Shipment Graph 31. B.C. Tree Fruits Ltd. regional shipments and delivered prices, all fresh pears, 1963 crop, Eastern Canada. Os 9^ Dates of Shipment Graph 32. B.C. Tree Fruits Ltd. regional shipments and f.o.b. prices, all fresh apples, 1963 crop, British Columbia. 13 20 27'3 ' 10 117 ' 24 ' 31 7 14 21 28 5 12 19 26 2 9 _I6 23. 3 0 7 14 21 28 4 II 18 25 I 8 15 22 29 7 14 21 17 24 31 7 14 21 28 4 II 18 25 2 9 16 23 30 6 13 20 27 4 II 18 25 I 8 | 15 22 29 July '63 Aug Sep Oct Nov Dec Jon 64 Feb Mar Dotes of Shipment Graph 33. B.C. Tree Fruits Ltd. regional shipments and delivered pnces.all fresh apples, 1963 crop, Western Canada. isoor 27 3 10 17 24 31 7 14 21 28 5 12 19 26 2 9 16 23 30 7 14 21 28 4 8 15 22 29 8 15 29 7 14 21 28 4 II 18 25 2 9 16 30 31 7 14 21 28 4 II 18 25 2 9 16 23 30 6 13 20 27 4 11 18 25 I II 18 25 I Jul Aug'63 Sep Oct Nov Dec Jan'64 Feb Mar Apr May Dates of Shipment Graph 34. B.C. Tree Fruits Ltd. regional shipments and delivered prices, all fresh apples, 1963 crop, Eastern Canada. M • 173 APPENDIX V.I I I AVERAGE DAILY PRICE (0/lb ) FRESH APPLES, ALL CANADIAN MARKETS. 1963 CROP B r i t i s h Other Western E a s t e r n Aug. S e p t Oct Nov. Columbia Canadian Mar- Canada ;e (f.o.b.) kets ( D e l i v e r e d ) ( f . o . b 15 9.7 11.1 18 9.7 11.1 26 9.7 29 §'3 9.7 31 £' 3 9.5 7 8.1 9.4 9 8.1 9.4 10 8.1 9.4 14 8.1 9.4 20 8.1 9.4 21 8.1 9.4 22 8.1 9.4 23 7.3 28 8.1 9.4 8.1 9.4 4 8.1 9.4 6 5.8 10 8.2 9.3 12 8.2 9.3 17 7.9 8.5 20 8.6 9.6 21 7.6 2 3 8.6 9.6 26 9.1 10.4 28 7.3 1 7.6 2 9.1 10.4 5 9.0 10.3 10 7.6 16 8.6 9.9 7.1 17 8.4 .9955 19 7.0 22 8.3 9.5 28 8.3 7.3 29 9.6 2 8.3 9.6 7.7 4 8.3 9.6 7.7 6 8.2 9.4 7.7 8 8.2 7.6 14 9.4 20 8.0 9.4 7.6 27 8.1 9 . 4 APPENDIX V I I I B r i t i s h Other Western E a s t e r n Columbia Canadian Mark- Canada Date (f. o . b . ) ets ( D e l i v e r e d ) (f.o.b.) Dec. Jan. Feb. Mar A p r i l May 3 7.9 9.3 9 7.9 9.3 16 7.3 17 7.8 9.0 7.6 23 7.7 9.0 30 7 . 5 3 1964 7.8 8.9 6 7 . 5 8 . 7.8 9 .0 7 . 5 1 7 7.8 9.0 6.3 18 21 7.7 9.0 24 6.8 2 7 7.7 6.8 3 0 2 7 7.7 6.8 3 0 5 7.7 9 .1 8 12 7.6 8.8 14 7.0 1 9 8.4 7.0 20 7.4 22 6.4 2 5 7.4 9 .0 6.9 6 7.4 8 .9 12 7.6 9 .2 14 6.9 17 7 . 5 9.2 6.9 20 7.7 9 .4 24 7.8 9 .4 6.9 2 6 8.0 9.6 6 .8 1 8.0 9 .6 8 8.6 10 .1 9 8.9 7.0 13 7.1 7 .1 16 7.1 1 7 7.1 20 6.7 21 8.1 9 .8 1 9.0 10.8 7 8.7 10 .4 6.8 8 6.9 11 2 5 11.8 1 3 . 5 APPENDIX VIII AVERAGE DAILY PRICE (£/lb) FRESH PEARS, ALL CANADIAN MARKETS 1963 CROP B r i t i s h Other Western E a s t e r n Columbia Canadian Mark- Canada Date (f. o . b . ) ets ( D e l i v e r e d ) (f.o.b.) Aug. 7 8.9 9 8.0 9.9 10 8.0 9.9 14 8.0 9-9 20 7.9 9.9 21 8.0 9.9 22 8.0 9.9' 23 8.0 9.4 28 9.9 Sept. 3 7.5 9.4 4 7.5 9.4 6 7.6 7.6 10 9.5 12 7.6 9.5 17 7.6 9.5 20 7.6 9.5 21 6.4 2 3 6.7 8.5 26 6.7 8.5 28 7.5 Oct. 1 7.5 2 7.3 9.2 5 7.3 9.2 10 9.7 16 7.5 9.4 9.9 17 7.7 9.6 19 9.2 22 7.7 9.6 28 9.2 29 7.7 9.6 Nov. 2 7.7 9.6 8.7 4 7.9 9.8 7.7 6 9.6 11,5 8.6 8 8.6 14 9.6 11,5 20 9.6 11.5 8.6 27 9.6 11.5 Dec. 3 8.6 5 9.6 11.5 9 9.6 11.5 17 6-APPENDIX V I I I B r i t i s h Other W e s t e r n E a s t e r n C o l u m b i a C a n a d i a n Mark- Canada Date ( f . o . b , ) e t s ( D e l i v e r e d ) ( f . o . b . ) Dec. 1 6 8 . 7 1 7 9 . 5 1 1 . 4 23 9 . 5 1 1 . 4 8 . 7 3 0 8 . 7 J a n . 3 1 9 6 4 9 . 5 1 1 . 4 6 9 . 3 8 9 . 5 1 1 . 4 9 . 3 1 7 8 . 2 1 0 . 0 2 1 8 . 1 9 . 9 2 7 8 . 1 9 . 9 AVERAGE DAILY PRICE ( 0 / l b ) FRESH CRAB-APPLES., ALL CANADIAN MARKETS., 1 9 6 3 CROP Aug. 7 6 . 7 9 4 . 9 6 . 7 1 0 5 . 1 6 . 9 14 5 . 1 6 . 9 20 5 . 1 6 . 9 2 1 5 . 1 6 . 9 2 2 5 . 1 6 . 9 23 5 . 1 6 . 9 2 8 5 . 5 7 . 2 3 5 . 5 7 . 2 4 5 . 5 7 . 2 6 1 0 5 . 5 7 . 2 1 2 5 . 5 7 . 2 1 7 5 . 5 7 . 2 20 5 . 9 7 . 7 2 1 23 5 . 9 7 . 7 2 6 5 . 9 7 . 7 2 8 1 2 5 . 9 7 . 7 5 5 . 9 7 . 7 10 5 . 3 20  7.2 S e p t 4 5 . 5 7 . 2 5 . 7 6 . 1 . 1 O c t .  6 . 1 6 . 1 APPENDIX V I I I AVERAGE DAILY PRICE (£/ lb) FRESH PRUNES, ALL CANADIAN MARKETS, 1 9 6 3 CROP Date B r i t i s h Columbia ( f . o . b . Other Western Canadian Mark-ets (Delivered) E a s t e r n Canada (f.o. b . ) Aug. 7 11.5 9 8 . 8 1 1 . 5 10 8 . 8 11.5 14 8 . 8 1 1 . 5 20 8 . 8 11.5 2 1 8 . 8 11.5 2 2 8 . 8 11.5 2 8 8 . 8 11.5 Sept 3 8 . 8 11.5 4 f\ 8 . 8 11.5 0 1 0 8 . 8 11.5 1 2 8 . 8 11.5 17 8 . 8 11.5 20 2 1 8 . 8 11.5 23 8 . 8 11.5 2 6 8 . 8 11.5 8 . 8 8 . 8 AVERAGE DAILY PRICE (c*/lb) FRESH CHERRIES, ALL CANADIAN MARKETS, 1 9 6 3 CROP J u l y 2 2 5 . 5 2 7 . 3 4 2 7 27.4 5 3 0.4 6 3 0.4 7 3 0.4 8 3 0 . 8 3 0.4 9 3 2 . 0 3 0.4 1 0 2 7 . 6 3 0.4 1 1 29.4 3 0.4 1 5 2 7 . 6 29.4 2 8 . 7 1 8 2 2 . 0 2 3 . 8 2 8 . 7 20 2 8 . 7 2 6 2 2 . 0 2 3 . 8 29 2 2 . 0 2 3 . 8 1.78 APPENDIX VI I I AVERAGE DAILY PRICE (#/lb) FRESH APRICOTS, ALL CANADIAN MARKETS, 1 9 6 3 CROP B r i t i s h Other Western E a s t e r n Date Columbia Canadian Mark- Canada (f.o.b.) e t s ( D e l i v e r e d ) ( f . o . b . J u l y 1 5 1 1 . 3 1 3 . 3 1 8 1 1 . 3 1 3 . 3 24 1 1 . 1 26 1 1 . 3 1 3 . 3 1 1 . 1 2 7 1 1 . 1 2 9 1 1 . 3 1 3 . 3 3 1 1 1 . 3 1 3 . 3 AVERAGE DAILY PRICE (£/lb) FRESH PLUMS, ALL CANADIAN MARKETS, I963 CROP J u l y 2 6 8 . 5 1 0 . 6 2 9 8 . 5 1 0 . 6 3 1 38?5 1 0 . 6 Aug. 7 8 . 5 1 0 . 9 9 1 0 . 0 1 2 . 2 1 0 1 0 . 0 1 2 . 2 14 1 0 . 0 1 2 . 2 20 1 0 . 0 1 2 . 2 2 1 1 0 . 0 1 2 . 2 2 2 1 0 . 0 1 2 . 2 2 8 1 0 . 0 1 2 . 2 Sept. 3 1 0 . 0 1 2 . 2 4 1 0 . 0 1 2 . 2 10 1 0 . 0 1 2 . 2 1 2 1 0 . 0 1 2 . 2 17 1 0 . 0 1 2 . 2 20 1 0 . 0 1 2 . 2 23 1 0 . 0 1 2 . 2 2 6 1 0 . 0 1 2 . 2 1 7 9 APPENDIX V I I I AVERAGE DAILY PRICE (0/lb) FRESH PEACHES, ALL CANADIAN MARKET 1963 CROP Other Western B r i t i s h Columbia Canadian Markets Date . ( f . o . b . ( D e l i v e r e d ) J u l y 26 9.1 11.4 29 9.1 11.4 31 9.1 11.4 Aug. 7 8.9 11.0 9 8.9 11.0 10 8.9 11.0 14 8.9 11.0 20 9.3 11.4 21 9.3 11.4 22 9.5 11.7 28 10.1 12.2 S e p t . 3 10.1 12.2 4 10,6 12.6 10 10.6 12.6 12 10.6 12.6 17 10.6 12.6 Source: P r i c e L i s t s . B.C. Tree F r u i t s L t d . 1963 - 1964. 180 APPENDIX IX REGULATION OF TARIFFS The Canadian H o r t i c u l t u r a l C o u n c i l has e s t a b l i s h e d f o u r Trade and T a r i f f Committees i n r e s p e c t to f r u i t and v e g e t a b l e s f o r Western Canada, C e n t r a l Canada, E a s t e r n Canada and New foundland. As such the t a r i f f s p e r t a i n i n g to r e g u l a t e d f r u i t under the B.C. Tree Board i s the r e s p o n s i b i l i t y of the Western Trade and T a r i f f Committee s i t t i n g i n Kelowna. Tab l e XXX shows the dates of a p p l i c a t i o n and c a n c e l l a t i o n of s e a s o n a l s p e c i f i c t a r i f f s f o r r e g u l a t e d f r u i t f o r the 1963 crop season. These t a r i f f s are contained i n the Customs Act, 1958, but the dates f o r a p p l i c a t i o n and c a n c e l l a t i o n are f i x e d by the Trade and T a r i f f Committees i n c o n s u l t a t i o n w i t h the T a r i f f Board of Canada. Graphs 7 - 1 4 i n c l u d e the p e r i o d o f t a r i f f a p p l i c a t i o n f o r the r e g u l a t e d f r u i t . The peak per i o d s of marketing are adequately covered. No excess over the s t i p u l a t e d t a r i f f s can be invoked but S e c t i o n 40 (a) 7 b of the Amendment t o the Customs A c t , 1958, quoted below allows f o r "over-and-above" t a r i f f s t o combat what i s p o p u l a r l y known as the dumping of f o r e i g n f r u i t i n the Canadian f r u i t market. S e c t i o n 40 (a) 7 b s t a t e s t h a t : Notwithstanding anything i n t h i s Act, (b) where the market p r i c e i n the country o f export of any f r e s h f r u i t or vegetable of a c l a s s or kind produced i n Canada, has as a r e s u l t of the advance of the season or the marketing p e r i o d , d e c l i n e d t o l e v e l s that do not r e f l e c t i n the o p i n i o n of the M i n i s t e r t h e i r normal p r i c e , the value f o r duty of such f r e s h f r u i t or v e g e t a b l e , when imported i n t o such r e g i o n or part of Canada and d u r i n g such p e r i o d as the M i n i s t e r may s p e c i f y , s h a l l be the amount determined and d e c l a r e d by him t o be the average valu e , weighted as t o q u a n t i t y , at which l i k e f r e s h f r u i t s or vegetables were imported d u r i n g the three year p e r i o d immediately preceding the date of shipment t o Canada. The normal p r i c e of f o r e i g n f r u i t i s d e f i n e d as the t h r e e - y e a r moving average of p r i c e s , and i f p r i c e s d e c l i n e below t h i s minimum (the Trade and T a r i f f Committees s p e c i f y a l e v e l of 2% below the t h r e e - y e a r moving average), r e p -r e s e n t a t i o n s are made t o the T a r i f f Board of Canada, and on p o i n t s of law and d e f i n i t i o n appeals t o the Exchequer Court of Canada are a l l o w e d . The T a r i f f Board however i s not bound t o act upon the r e s o l u t i o n s of the Trade and T a r i f f Committees and i n a number of i n s t a n c e s i n the l a s t few years has r e j e c t e d r e s o l u t i o n s a s k i n g f o r h i g h e r t a r i f f s on imported f r u i t . No excess t a r i f f s have every been imposed on r e g u l a t e d f r u i t over and above those contained i n the Amendments. Thus, while normal t a r i f f s h e l p to improve the marketing p o s i t i o n of r e g u l a t e d f r u i t , the power t o e x e r c i s e S e c t i o n 40 (a) 7 b i s more a p o t e n t i a l weapon against f o r e i g n f r u i t e x p o r t e r s . C s u t i o n i s e x e r c i s e d i n the use of t h i s s e c t i o n s i n c e e s p e c i a l l y i n the U n i t e d S t a t e s , r e t a l i a t o r y 1.82' e x i s t . The T a r i f f Board of Canada thus a c t s i n the i n t e r e s t s of i n t e r n a t i o n a l trade r e l a t i o n s i n not i n v o k i n g t h i s s e c t i o n i n d i s c r i m i n a t e l y or at the s u g g e s t i o n of the Trade and T a r i f f Committees. TABLE XXX APPLICATION AND CANCELLATION OF SEASONAL SPECIFIC TARIFF REGULATED F r u i t Apples A p r i c o t s C h e r r i e s (sour) C h e r r i e s (sweet) Peaches Pears Plums A p r i c o t s T a r i f f Duty % f o r weeks 10% 10fa 10% 10% Free 10% 10% FRUIT, 1963/1964 SEASON S p e c i f i c Max.Season T a r i f f (jVlb) (weeks) 42 42 45 38 13 17 (May—June) 39 (May-June) 40 1/4 1-1/2 3 1-1/2 1 1 1-1/2 52 10 10 14 22 10 12 Western Zone (West of F o r t W i l l i a m ) . A p p l i e d C a n c e l l e d 9 J u l y 17 Sept. Not A p p l i e d For Not A p p l i e d For 27 J u l y 12 Nov. 8 Aug. 9 Jan.1964 Not A p p l i e d For Not A p p l i e d For Weeks Used 52 10 14 22 8 Aug. 31 October 12 Sources Schedule I, The Canadian H o r t i c u l t u r a l C o u n c i l of Canada, Report of the Trade and T a r i f f Committees, Annual Meeting, Ottawa, Feb.10 - 12, 1964. " CO 

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