ing to vegetables some of the acreage released from basic crops. This is taking place in some districts wholly unadapted to vegetable production, in spite of the fact that such ventures resulted in absolute failure less than 20 years ago at the time of boll-weevil infestation. Even if these crops could be produced successfully in far-flung districts, it would result in adding to surpluses already found in the areas of established production. Then there is the important matter of finding satisfactory market outlets. It is one thing to produce a commodity and quite another to sell it to advantage. Generally speaking, crop specialization in favored areas is essential to successful fruit and vegetable production. From 1926 through 1931 the railways of this country moved a little over 1 million carlots of fresh fruits and vegetables to market annually. More than 7,000 railway stations report to the Department of Agriculture each year on carlot shipments. This does not include numerous nonagency loading stations which originate shipments of these commodities in carlots and less-than-carload quantities. Thousands of other loading points originate motortruck shipments for direct movement to market in less than carlots. Furthermore, the number of railway billing stations for these commodities would be greatly enlarged except for the concentration of rail loadings by the use of motortrucks to haul produce from outlying points to carlot shipping stations. There is further evidence of widely scattered production in the fact that during the 10-year period ending with 1936 every State except five shipped an average of more than a thousand cars of fruits and vegetables annually. THE Factors That Influence Production LOCATION AND TRANSPORTATION FACILITIES 'HE OPINION is sometimes advanced that the building of good roads and the use of the motortruck have caused material shifts in production of vegetables from remote areas with long-haul shipments by rail, to districts near the large markets. Although many areas near consuming centers have witnessed expansion of acreage, some more remote sections-as in California, Arizona, Texas, Colorado, and Florida, for example-have also maintained or increased their production. Influences other than distance from market alter production trends. For instance, potato growers in Maine averaged 268 bushels per acre for the period 1931 to 1935, as compared with 133 bushels per acre in New York State, where producers are more advantageously located with reference to such markets as New York City and Philadelphia. Hence, it will be seen that for this period the Maine producer had an advantage in yield of 135 bushels per acre to compensate partially for his less favorable location as to market outlets. During this same period the average farm price of potatoes in Maine was 41.2 cents per bushel, compared with 61.6 cents in New York State. The farm value per acre was $81.93 for the State of Maine and $110.42 for the State of New York. In order to appraise correctly the advantages of the two areas. it is also necessary to take into consideration such factors as cost of production and the difference in cost of facilities for storing and handling. NATURAL ADVANTAGES Not only does the district possessing exceptionally favorable climatic and soil conditions produce a larger volume per acre, but in most instances the commodity is of exceptional quality by reason of these natural advantages. To illustrate, the irrigated districts of California, Arizona, and Colorado produce cantaloupes more uniform in quality than is possible in the Southeastern portion of the United States, where rainfall may be either excessive or insufficient. other hand, the Southeast excels in the production of watermelons. It is thus evident that factors beyond the control of the producer play an important part in the control of production. Drought, excessive rains, freezing, or a combination of these may reduce what promises to be excessive production to practically a crop failure. USE CHARACTERISTICS Unlike some other agricultural commodities, fruits and vegetables are used primarily for either food or beverages. While hundreds of uses are found for cotton and its byproducts, the potato must find its way to the table to maintain its place in the sun. Some starch is made from potatoes in this country, and in some foreign countries potatoes. are used extensively in the manufacture of industrial alchohol and starch, but the chief significance of this crop rests on its use as a staple article of diet. Many other vegetables, as well as most of the important fruits, are used only for food. The fact that many fruits and vegetables are primary-consumption commodities and may be used with little or no processing makes them readily adaptable for use on farms and in areas of production. Fruits and vegetables have long had a prominent place in the diet of many families. More recently it has been found that as sources of important minerals and vitamins this class of commodities ranks very high. In advertising their goods many producers are giving publicity to these findings and are obtaining increased consumption and wider distribution. CREDIT CONDITIONS Production credit has an important influence upon the acreage devoted to certain perishable crops such as potatoes, beans and other annuals. In many districts, distributors and commission men pioneered in financing the initial experiments in commercial production. This placed them in a commanding position with reference to future activities in those areas. Even in the older districts, where intensive production of these commodities has been practiced for years, financing is still the dominant influence. It is estimated that, during the crop year 1935-36, 75 percent of the potato acreage in North Carolina was financed by distributors. Potato plantings in North Carolina increased from 22,500 acres in 1925 to 32,000 in 1935. By 1936 nine different forms of crop contracts had been developed. Most of these practically guaranteed the distributor against loss except in the event of a virtual crop failure.3 By reason of the rapid increase in the acreage of potatoes in that State and the overlapping of its marketing season with that of the Eastern Shore of Virginia, producers in both districts now find it difficult to produce potatoes on a profitable basis. For more than a quarter of a century the Eastern Shore of Virginia and Maryland was one of the most profitable potato-producing districts along the Atlantic seaboard and, during the harvesting season, that area practically dominated the markets east of the Mississippi River. Now the picture is greatly changed, and there is overlapping in marketings from the Middle West and California as well as from North Carolina. Competitive factors seem to encourage large-scale operations in the production of several commodities along with a tie-in between production and distribution. For instance, several distributors of Maine potatoes make contracts for the growing of the crop, lease or build storage space, and then market the tonnage. Terminal-market distributors, including some of the chains and their subsidiaries, gain control of tonnage through the extension of production credit or other forms of financing. Some producers say that the low production costs necessary to compete successfully with other districts can be achieved only through large-scale operations, such as require help in financing. Terminal-market distributors claim that they are forced to operate on closer margins to meet competition and that this makes it necessary for them to go as directly to the source of supply as possible. It is not unusual for a distributor to control 500 to 1,000 cars in a given area through crop contracts and financing. 3 JOHANSEN, J. W., and HECKMAN, J. H. REPORT ON CONDITIONS OF PRODUCTION CREDIT AND MARKETING FOR IRISH POTATOES IN EASTERN NORTH CAROLINA. North Carolina State College of Agriculture. 25 pp. 1936. (Mimeographed.) These large-scale operations are already being practiced in many of the early potato-producing districts of the South, the Southwest, and the far West. Fertilizer manufacturers are getting into the production game as a means of developing outlets for their goods. Through agents, subsidiaries, and independent operators, large volumes of fertilizer are sold to producers. Control of the distribution of the crop thus passes from the grower to the credit agency. A two-way method of insuring production against losses is utilized by these operators: (1) They collect wide margins on fertilizer and supplies handled; and (2) as a side-line operation, they purchase crops financed or charge enough for sales services to make a profit. Some of the private firms have recently advertised that they will keep accurate records of all costs of distribution of potatoes financed by them and at the end of the season rebate to the growers net earnings upon a pro-rata basis. While this is a catchy proposition, the plan is not without merit. Unfortunately, however, the grower has no control over selling costs. Credit as now made available through the production credit associations, sponsored by the Farm Credit Administration, should ultimately provide a means by which the growers can control their own credit machinery. Experiments are now being conducted in the building of credit reserves to determine effective means of making such credit extension safe and dependable for the producers. It probably will be several years before this program is fully developed. The efficiency and extent of use of this improved source of production credit by producers of perishable crops will depend largely upon attitude and the initiative of producers themselves. In some districts the system is working with a remarkable degree of efficiency, and affords evidence that it may be employed in other districts with equal effectiveness. the Producers now carry the burden of production hazards by paying wide margins on supplies, high marketing charges, and other costs. Some cooperatives have conserved and set aside a portion of these margins and charges as credit reserves for their members. In a program of this kind the grower provides for himself a dependable source of credit, over which he exercises control. Co Distribution Proccesses and Problems STANDARDIZATION 'ONSIDERABLE progress has been made in the standardization of fruits and vegetables. For a time this work was influenced largely by the whims and fancies of the commercial trade, and as yet considerable work needs to be done to better adapt existing grades and standards to the practical needs of producers, the produce trade, and the Here oranges are graded, stenciled, and packed for distribution throughout the ultimate consumer. Under authority of the United States Depart- Minimum quality and requirements for fruits and vegetables are clearly defined in the various grades. Since the Federal fruit and vegetable grades describe the minimum quality that will be permitted in a grade, there is a possibility of considerable variation in quality between lots of the same grade designation. One lot may be barely within the tolerance, while another may be well above. The chief advantages of standardization are that: (1) A common language is provided for use between buyer and seller and other financially interested parties, and (2) there is an advantage in actually separating the product into different grades of market quality. The extent to which culling should be practiced in sorting commodities into the higher grades depends upon the financial advantages to be gained. Distance from market, transportation and other carrying charges, and profitable outlet for the luxury product should be carefully considered, as well as the reduction in volume by reason of the |