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UMASS/AMHERST

3iaGbbDDa37D70D

inininrTininifHninnrwiininrry

nSSS5K3T^^T^r?^o?«S^Wi

'^f.

Financing The Cranberry Crop

by

BERNARD T. McGOWAN

Office of The Comptroller of The Currency

First Federal Reserve District

Boston, Massachusetts

FINANCING THE CRANBERRY CROP

by

BERNARD T, McGOWAN OFFICE OF THE COMPTROLLER OF THE CURRENCY FIRST FEDERAL RESERVE DISTRICT BOSTON, MASSACHUSETTS

Submitted in partial fulfillment of the requirements of The Graduate School of Banking conducted by the American Bank- ers Association at Rutgers University o

New Brunswick„ June 19^2

3 2>^

CONTENTS

Chapter Page

1„ INTRODUCTION.

V

■OOOdOOOOOOOOOOOOOOOOOO

II o ECONOMIC IMPORTANCE OF THE CRANBERRY INDUSTRY o , » o » 1

The Cranberry Plant ooooooooo<,oo.,oc 2

History of the Cranberry of Commerce ,0000000 h

Growth of the Industry 000000000000.00 $

III, THE CRANBERRY BOG 6

•UoXlU ooooooooooeoooeoooooooeo O

Role of Soil in Crop Production 000.00.00 6

Upland Soils vso Bog Soils „„oooooooooo 6

now X XeUulOo " SSCi ooooeooooooaooooe f

Why Cranberry Plants Grow on "Acid" Humus 0000 8

The Nitrogen Cycle and the Cranberry Plant . . » « 8

J-tOOdX' xOXl oeoeoooooodoocoooeooeo jf

VlcLu^Xooooooeoooo 00 00 00 ooooeo y

OoIlU ooooeoooooooooooeoooooo JbL/

n"cLt'Il"x o oooooooeooooooeoooooe J»w

JU^UUST oooooooeooooooooooo 0000 aLb

XT^Cpdj^Cl wiUXl o 0000 ooooeooooooooooo J.i^

• Ux Ju AllU 0<^'u" ooooooooooooeooeo 00 o •^J^

Jjr»«**l»giW oooooooooooooooooeoooo "l *j

*J 301 Soooooo 00000 00 eoooooo eooo ^^

Varieties of Cranberries „ » o » o o o . o . o . o o 15

V jj!l6 o6X>VJ-i!i^So ooeooooooooooeooooo XO

>i>X X X^clX'XOIi oooooooooeooooooooooe «•!

Cost of Building the Bog „ . . o o o o « o o o , » 0 1?

wo-I*© O I TfiiQ DOgc 000000000000000000 iO

Jtr GjrXr XJ. J.ZcT' Ooooooooooooooooooeooo ^\J

nS^SciXlQ. Jolg ooooooooooeoeoooooooe "^jt

Disease^ Weed and Insect Pest Control o » . o o . o , 20

Cash Outlay before Initial Harvest „ „ . » . « o o . 20

Cash Costs of Bog Operations o o o » o . o . o o « . 21

Chapter Page

IV. CRANBERTBT HAWEST. , 22

Picking Season » 22

Methods of Picking 22

Yields 2li

Labor. 2^

Cost of Hand Harvesting vs. Cost of Mechanical Harvesting. 26

Storage. .,...,.,. 28

Preparation, Standardization and Grading . , 29

Interim Crops. . 29

V, PRODUCTION AND MARKETING ........ 31

Growing Areas and Annual Production 31

Channels of Distribution ...... 33

Individuals. 3U

Private Distributing Agencies. 3li

The Cooperatives ............ 35

Cost Against Selling Price ,..,,,..... iiO

Price Fixing hi

VI. FINANCMG THE CRANBERRY CROP U5

Methods of Financing the Grower. . , U6

Methods of Financing the Distributing Agencies ...... 5l

Methods of Financing the Fruit and Produce Tlfholesalers . . 52

Methods of Financing the Industrial Users 52

Methods of Financing the Cooperatives. 52

VII, CREDIT EXPERIENCE. , ^h

Risks of the Industry, ,,..... ^h

Banks with the Grower. ..,, 56

Banks with the Distributing Agencies 56

Banks with the Cooperatives. 57

VIII. FUTURE OUTLOOK OF THE INDUSTRY , , 60

IX . CONCLUSION ....,,......,.,,. ... 62

APPEND n

Exhibit 1 CASH COST OF BOG OPERATIONS. 6U

II CRANBERRY PRODUCTION IN THE UNITED STATES 65

III PROVISIONS OF THE CAPPER-VOLSTEAD ACT, . . 66

IV OPINION OF THE COURT IN MONOPOLY CASES . 66

BIBLIOGRAPHY ..,, c,, ,.,.,.....„,.,. . 6?

CHAPTER I

INTRODUCTION

The cranberry industry in Massachusetts^, New Jersey and Wisconsin is an old one, while the industry on the west coast can measure its history in a few decade So Cranberry culture is a highly specialized phase of agriculture „ Cranberry growing re- quires particular skills and knowledge.

The small group of cranberry producers has long been recognized as having more than average alertness and forward look- ing leadershiOo The industry flourishes in those parts of the states and on a type of land where it is not competitive with other types of agriculture c Hence, it geographical distribution is quite un- like that of any other crop.

This study covers the history of cranberry culture in the five commercial producing regions of the United States, Cranberry cultivation requires sizeable capital investments for bog construc- tion and maintenance., From three to four years are required for a newly planted bog to mature before the grower can normally expect a return upon his investment o The normal value of cranberry bog acreage is very high when compared with the value of the acreage devoted to other specialized branches of agric\iltureo Successf\il cranberry cultivation requires great care in selecting the proper location for the bog. The marsh land used must be highly acid, the water supply slightly acid, the humus of considerable depth and the source of loam free coarse sand accessible nearby.

The cranberry harvest is described from the picking of the fruit to its preparation for the market. Suggested ventures for the cranberry grower into the production of an interim crop, which would enhance the value of the property and be a source of additional income are presented for the consideration of the in- dustry at large.

The production and marketing of the crop is portrayed as it existed in the stabilized market of 1951. It is beyond the in- tent of this paper to dwell upon the problems which faced the in- dustry in recent years principally because of large crops. The mar- keting of these crops presented problems, however, these problems were greatly intensified by the actions of the people within the industry. The cranberry industry has been dominated by a few

individuals, whose actions apparently were not always for the common good of the industry. There exists in the industry today, especi- ally between the principal cooperatives, a great rivalry for new members in order to control their cropso The problems between the cooperatives are accentuated by the clash of oersonalities of their leaders.

The creation of the Cranberry Growers' Council was the result of a compromise between the cooperatives o The Cranberry Growers' Co\ancil is empowered only to make recommendations to the cooperativeso The cooperatives and the great majority of the in- dependents followed the Council's recommendations during the last crop year, ■v*iich resulted in a stabilized market „ Since the co- operatives cannot find a common ground for consolidation, they have approved extending the life of the Cranberry Growers' Co\ancil for another year.

The writer has not made use of any observations or informa- tion obtained in the course of examing banks, unless specific per- mission for such use was first obtained fY'om the banks. The informa- tion pertaining to the financial aspects of a great Dart of the cran- berry industry is public information. The writer has set down for the use of the bankers throughout the country, who are engaged in extending credit to the cranberry grower, a realistic method of ap- proach in appraising cranberry bog property. This appraisal method weighs the many factors involved in arriving at a fair normal value for loan purposes.

In most all agricultural endeavors there is a common denominator - the struggle with the natural elements. The cranberry industry is much better prepared to cope with these elements than are some other branches of agriculture. The industry has developed ef- fective tools for frost prevention and the control of seme insects. The degree of control sought in controlling the natural elements, which are harmful to the industry, has a direct relationship upon the net returns to the cranberry grower.

The future outlook of the industry is predicated upon the continuance of a stabilized market. The cranberry industry appears upon the threshold of a bright and prosperous future. Cranberry cultivation, if forces within the industry act for the common good, will once again become the profitable industry that it fonnerly was. If these forces pull away from the organized effort to market the crops, thqr can easily wreck the cranberry industry as it exists today.

11

CHAPTER II

ECONOMIC MPOHTANCE OF THE CRANBEWBT INDUSTRY

The industry is comparatively compact as to the niimber of nrimary operators snd as to the total of bog acreage under cultivationo It is estimated that there are slightly over two thousand cranberry growers in the nation. 1 These growers culti- vate 27j02o2 acres of cranberry bogs, with the other acreage used for sand banks and water facilities estimated at over 300,000 acres not taken into consideration „ The land brought into use for cranberry cultivation is for the most part submarginal in quality, being composed of swamp and bog lands; hence, it does not enter into competition in land utilization with any other agricultural cropo Clarence Hall, editor of the trade magazine "Cranberries," estinates that the cranberry industry gives em- ployment to more than U0,000 people throughout the season; surely then^ the regions where cranberries are grown would be economically poorer without this fonn of agriculture „ In the final analysis, we are dealing with a fruit that is primarily a luxury item in our diet, nevertheless, through tradition, custom and advertising a demand has been built up over the years to a point where the markets of this country and Canada consumed the 19^0 crop of 98U,300 barrelSo3 The ten-year average return to the growers (1938-19i;7) from these crops was better than $lls800^000>

Two-thirds of the world's supply of cranberries is grown within fifty miles of Plymouth Rock in MassachusettSc In a difficult situation now following a sizeable war expansion

"Cranberry Skin Keeps Its Shine A Fair Parable," Food Marketing in New England (November, 19U6), Vol., 7, No, 3, Po lo

2 United States Department of Agriculture, Agricultural Statistics,

19^0, Table 21^7, Po 205o

3United States Department of Agriculture, Bureau of Agricultural Economics, Release, January h» 19^2 «

^United States Department of Agriculture, Agricultural Statistics, 19^0, loco cit.

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cranberry growers are bothered by prices which are less than one-third of parity, by the shortage of tin cans in which more than half the crop is packed, and by higher production costs this year. The grower's income in 1950 was said to be only one-half his expenses. 5

The opening price per barrel for the 19^1 crop, set by the American Cranberry Exchange, was $l5oOO„ The market was stabilized at the opening price and renained that way throughout the season, and at times reached $20„00 a barrel. The 19^1 crtsp of 932,^00 barrels was the third largest on recordj, being sur- passed only by the 19U6 and the 19^0 crops. Almost all the cranberries are sold by two national cooperative organizations which push their products by vigorous advertising and merchandis- ing. Despite the uncertain transition^ growers are confident the future of this highly compact industry looks brighter =,

The cranberry industry j, during the past season, suc- ceeded in working off its heavy carry-over of earlier crops, and wound up in good condition. Aggressive advertising and marketing by the two cooperatives were resoonsible in 1951 for reducing in- ventories." The degree of success in disposing of this year's crop in its entirety will leave its impact upon the growers of Massachusetts, New Jersey, Wisconsin, Oregon and Washingtone Todsy, leaders in the industry foresee a shortage of processed fruit for ■the "off-season" monthso The Coooeratives expect that they will have to ration the available suoplies during the sim- mer months. If their predictions are borne out, the industry will face the coming season with a strong, steady demand, pro- vided they do not set their opening prices too high and let com= petition from within the industry once again upset the market. These leaders in the industry are planning for a 1 <, OOO^, OOO-barrel crop. The immediate future looks bright for the cranberry indus- try, provided that the various groups within the industry do not once again fall back into the disastrous errors of the past few years. Cranberries can now be considered a thirty million dollar industry .

The Cranberry Plant

The Indians had a word for the bright red berries that provided Cape Cod tribes with fruit and medicine - sassamanesh. These berries probably have always grown here in the wild state.

''"The New England Farmer in 1951s His Position, His Problans, His Prospects," New England Newsletter, June 195ls No, 327, o. 17.

"New England - 195lj" New England Newsletter, December 1951^ No, 333, P. 18,

„3=

The writer observed some few years ago that wild cranberries grew far back in the fastness of the deep Maine woodso A natural patch at Gay Headj on Martha's Vineyard, sanded and watered by the ocean J has been producing annually as far back as there is recorded history,, and probably well before the white man came„ By an act of the General Court of the Commonwealth of Massa- chusetts,, these cranberries are for Gay Head Indians in perpetuity.

The Indians knew and valued the berry,, They gathered the fruit wild from the lowlands, ground it into a pulpy mixture with dried deer meat and made "pemmican, " which provided a complete diet. The dried cranberry-meat diet is used extensively by Arctic explorerSo At the present time, the Army is experimenting with this mixture as a perfect dietary component for the Alaskan soldier's fare.

The cranberry is our only native American fruit » It is rich in Vitamin C (the anti-scurvy vitamin), being fiilly one- half as rich as orange juice in this regards The Vitamin C is retained to a large extent when the berries are made into whole- fruit sauce. There is also present a small ancunt of Vitamin A, the cod-liver oil vitamino The cranberry, therefore, besides possessing an attractive appearance and flavor, possesses merit, as well, from a nutritional viewoointo This is the rich heritage passed by the Indians on to the Pilgrims, who made the native berry into a traditional American dish at the first Thanksgiving.

How and when the name "cranberry" was first derived is not a historical facto The cranberry, to begin with its day of christening,, was so named because its snonsors fancied that its bud resembled a crane; andj, in truth, just before the bud expands into the perfect flower with stem, calyx and petals, it resembles the neck^ head and bill of that ungainly bird. Hence, it was called "Craneberry, " later popularized into the word " cranberry o"

The cranberry of commerce = vaccinium macrocarpon - is a native of North America only, although a closely related s-pecimen - vaccini\m oxycoccus? grows in Northern Europe and Asiao This sioecies, however, has much smaller berries that are not suitable for ctiltivation.

The cranberry plant is a trailing vine with many up- right branches and roots. Both the runners and the uprights have leaves, but only the latter bear fruit. The leaves are evergreen, but turn brownish in winter. The vines make a mat all over the surface of a cultivated bog. They blossom in late June and early July, and the fruit ripens in September and October, The flowers depend mostly on insects for pollination;

7 Franklin, Henry J. "Cranberry Growing in Massachusetts."

Massachusetts Agricultur'al Experiment Station, Anril 19ii8, Bulletin No. khli Po 1.

-h-

and, idiile wild bees are usually plentifulj the grower usually owns or rents apiaries for this purpose „ The set of the fruit is not affected by night coolness short of frost during the blooming period „

History of the Cranberry of Commerce

The commercial potentialities of the native cranberry were overlooked for two hiandred years | butj, in the meant imej the Caoe Cod women folk picked and stewed wild cranberries each fall,, Sea caotains sailing to the far comers of the world, carried barrels of cranberries with them to nrevent the dreaded scurvy„ AT)oarently, the Cape Cod men werej at that time 5 busily engaged in other pursuits and were content with nature's offerings. How-= ever, they were not unmindful of the berries' inherent goodness or possibly they were more concerned with the moral goodness of their neighbors for they were opposed to picking the berries on Sundayo They caused to be enacted this ordinance in the Town of Provincetown on December 7^ 1773°'

"Voted that any purson should be found getting cranberys before ye twentyth of September excedeing one quart shall be liable to pay one doler and have the berys taken awavc" Yotedj, "That they who shall find any purson

so gathering shall have them and the doler«" Voted^ "That any purson should be found get= cranberys or the Sabboth shall be liable to duble punishmento"^

Samuel Atwoodj, Toum Clerk'

It was not until 1812 that Henry Hall of Dennis began experimenting with the wild cranberry « He transplated a few hardy wild vines in a little patch near his hcsme^ and found that the berries grew much larger and had a better flavor than the wild oneso This is the recorded beginning of domestic cran- berry cultivation in North America,, Out of these beginnings has grown the commercial cranberry industry as we know it today„

Herej, indeedj, is an oldy oldg agricultural industry especially in view of its sonewhat specialty natureo Old iiidus- tries, like old ships" bottomsc, tend to gather barnacles, and the cranberry industry has had its share o It has paid well from the start and because of its promise of profits,, backed by actual delivery of the same« hasj, at times,, enlisted those antidotes for barnacles - leadership^ visionj, eners^ and initia= tive. The efficient marketing pr'Og^'am developed has evolved the use of better methodso These novel methods are regarded by some other agricultural groups with envy.

The Cape-Tip Breezej, Psrovincetownj, Mass„ Mid=Sxanmer 1951? Po il«

^5„

Growth of the Industry

First attempts were made to cultivate cranberries in Southern New Jersey between 1830 and I81i0„ Other states became interested in this branch of agriculture; Wisconsin in 1835* Oregon between IBBO and 1885 and Washington in 1923 «

From such modest beginnings in 1812-1813 the cranberry worked its way out of obscurity to a point at which, at the turn of the century^ the cranberry bogs of Massachusetts, New Jersey and Wisconsin produced the then staggering harvest of 318,000 barrels. During the first half of this century the annual har- vest has increased steadily to a point where a 932,500-barrel harvest is looked upon as an almost normal expected harvest. Massachusetts now contributes 590j,000 barrels, or 63 oW of the croTD; Wisconsin contributes 190,000 barrels or 20„/4^ of the ci'op; New Jersey contributes 76,000 barrels or 8ol^ of the crop; Washington contributes 56,^00 barrels or 6,0^ of the crop; Oregon, the other principal producer, contributed to the harvest a total of 20,000 barrels or 2A% of the crop„9 it was not until the middle of the twenties that the far Western States became quantity TDroducerSo From sudi modest beginnings where the income of the family bogs was first used primarily as a means of raising the yearly taxes, \mtil today, the crop produces an average gross return of better than $16, 000, 000 o 00 „ The day of the 1,000,000- barrel harvest is in the not too distant future.,

g

-'United States Department of Agriculture, Bureau of Agricultural Economics, Release, January li, 1952.,

CHAPTEIl III

THE CRANBERRY BOG

Land

When one considers the energy of the cranberry j, and how it develops the resources of hitherto waste land, one may •well wonder why a more vigorous effort is not made to culti- vate it in new territories o This will be easily discerned when one learns that certain descendents of the family - its Ishmaels, so to speak^ roam wild in sections of the country not known to its civilised brethren o The cultivated cran- berry thrives well in the same localities where its wild prede- cessor did^ due to the fitness of the climate and soil„ The soil must be acid,, All attempts to divert the cranberry's preference for oeaty and alluvial soils have oroven a failure, for it knows no compromise and will either have these or rjerish,, The depth of the soil need not be great, a few inches of T5eat or one layer of turf over sand or clay often giving good results.

Role of Soil in Crop Production

The soil serves as a mechanical support for crop olants. It likewise serves as a reservoir for certain plant nutrient elements„ The substances used by living plants are called plant nutrients or plant nutrient elements. The nutri- ent elements generally recognized as essential to normal plant growth for most plants are as follows? carbon^, hydrogen, oxygen, Dhosphorus, calciim, potassiura, magnesium, sulphur^ iron, nitro= gen, cODoer, manganese, boron^ zinCp and perhaps two or three more so-called "minor element So" In soil culture all these nutrient elements, with the exception of carbon, oxygen and hydro= gen, are supplied to the plant through the median of the soil.

Upland Soils vso Bog Soils

Well -drained soils have developed under a heavy forest cover. Rainfall has been moderately heavy and soils which develop under these conditions, regardless of the parent materials fran

-6-

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■which they -were derivedj acquire certain similar properties. Organic matter accumulates as a layer on the ground as a re- sult of the annual fall of leaves and accumulation of the re- mains of dead parts of trees and other forms of vegetation. This layer of organic matter or "raw humus'* often reached a depth of a foot or morCo The layer did not build up indefin- itely because rapid processes of breakdown or decomposition ■were going on in these well-aerated soils at the same time that fresh material was being added to the surface, A point was reached at which the accumulation was evenly balanced by the rate of decomposition or destruction. When this point was reached the deoth of the organic matter layer became constant.

Decomposing organic matter released plant nutrient elements which were then taken up by the roots of living plants to again be built up with plant tissue So Thus, a continuous cycle was set up^ which under natural conditions could have operated almost indefinitely.

Some products of organic matter decomposition, when carried down through the mineral horizons of the soil by rain water, exerted a strong leaching action on soil minerals. Much of the calcium, magnesium and potassium, as well as other elements, were brought into solution and, if they were not taken xm by deei?- rooted plants, were lost from the soil in the draining water. Note, therefore, that the accumulated layer of organic matter and not the mineral soil represented the accumulated reserve or store of fertility, WicR the forests were cut down and the land brought under cultivation, the soils remained fertile and produc- tive just so long as the reserve of organic matter lasted, TThen that was gone, supplementary application of manures of one kind or another became necessary.

Bog land soils, the soils which support the growth of cranberries, either developed under water or under conditions of very poor drainage. The type of vegetation was different from upland soils and the conditions under which these plants grew were different o A similar process of organic matter accumula- tion and decomposition took place, and new because of the absence of air or quantities of free oxygen, the accumulative processes greatly overbalanced the destructive processes. The result was that great quantities of organic matter in the form of peat and muck acciiraulated in the ponds and lowlands. Gradually, the ponds disappeared leaving behind these vast deposits of "stored up" fertility. It is these deposits which constitute the soils which supply most of the fertility to the cranberry plant.

How Plants Feed

The fine collodial clay particles of a mineral soil and the fine collodial particles of an organic soil are nega- tively charged. The negatively charged particles have an affinity for positively charged elements such as hydrogen, calcium, mag- nesiim, potassium and other elements, A single particle of clay

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or humus may have several of these differently charged ele- ments "attached" to its surface at the same time« When a plant root hair comes in contact -with a clay or humus particle an "exchange" can take place whereby a positive hydrogen (oro- duced by living processes within the root) from the root hair can be traded for a positive calcium or magnesiim or potassium element on the clay or humus particle. In this way the reserve of these elements on the soil colloids is gradually reduced and the reserve of "replaceable" hydrogen is increased „ When the supply of calcium, magnesium or potassium in the soil is replen- ished, hydrogen on the clay or humus Darticles can again be re- placed and the reserve of "replaceable" hydrogen reduced.,

The base exchange mechanism not only explains how certain elements are taken up by the plant but also explains why many of these same elements in the soil are not easily leached or washed awayc It explains why the fertility of cran- berry bog soils is not rapidly lost as a result of frequent flooding.

Why Cranberry Plants Grow on Acid Humus

The base exchange capacity or the total quantity of positively charged elements which can be absorbed depends upon the total quantity of collodial clay or organic matter present in a given quantity of soil„ Soils with high content of col- lodial matter can "store" much larger quantities than soils with low collodial content. Since cranberry soils are mostly organic matter, their "storage" or exchange capacity is very large o

The total exchange capacity for cranberry mucks and Deats is ten to thirty times greater -thsin that of many productive UTjland soilso Because of this very large "storage" capacity, it is possible to have a large amount of "exchangeable" hydrogen present which makes the soil acid and also to have a large quan- tity of calcium, magnesium, potassium and other positively charged elements present rhich the cranberry can utilize, A cranberry soil with a pH of iioO may actually have much more available calciun than an upland soil with a pH of 7<.0o

The Nitrogen Cycle and the Cranberry Plant

In upland soils the natural source of nitrogen is from decomposition of organic matter, Comolex proteins are broken down to give simple amino acidSo These acids in turn yield anmonia, and ammonia, in txu'nj, is changed to nitrite nitrogen and finally to nitrate nitrogen^ In productive upland soil the most important form of nitrogen is the nitrate form.

In the cranberry soil, because of the lack of aeration or free oxygen, it is difficult to explain how much nitrate nitro- gen would ever be formed. New Jersey experiments indicate that

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the cranberry plant can use nitrogen in the amino acid form and

also in the ammonium formo Hence, it would appear that the

complete nitrogen cycle is not essential to the normal function- ing of the cranberry plant.

Location

The cranberry bog should be on or near a stream large enough to flood it at any tnmeo If the stream is too small, its capacity for flooding must be increased by making a reser- voir above the bog location^ It is desirable that the bog loca- tion not be hemmed in by hills or heavy woodland. In the open locations there is usually a movement of air on the cooler nights reducing the element of frost risk.

l^ater

A water supply for flooding as much as is necessary at any time especially for flooding by gravity^ adds greatly to the value of the cranberry Dropertyo It is often difficult and costly to arrange for such a water supply in developing a new bogo In several of the producing states there are special laws favorable to cranberry growers in this connection,,

Many fine bogs are flooded by pimping from streams or ponds at lower levels, over a third of the acreage in Massa- chusetts being treated in this manner. The service of reservoirs is often greatly extended by pumoing the water used in flooding back into them again and again o The Atwood Bog Com-oany of South Carverj MassachusettSj one of the larger grovfers of "Eatmor" cranberries, uses an Interr.ational P-30 stationary power unit belted to a centrifugal pump„ This unit has the power and the capacity to handle the requirements of a 60-acre bog.

The main use of this power unit is to "flow" the bogs. The Atwood acreage, as it happens, is below the surrounding water level, so it is necessary only to raise the gate in the water channel at the pump house to "flow" the bogSo In a. very short time the bogs can be covered with a foot of water to kill insects or nrevent frost damage c As soon as the emergency is past, the water must be pumped off quickly so that the cranberries will not be damaged from a lack of oxygen for too long a period.

That is also where International stationary power units Cfflce in. These units have proved to be dependable starters, ready to meet these emergency calls at any time of the year, night or day. At the rate they operate, the water is pumped off in eight or ten hourso The unit in use has a capacity of pumping 10,000 gallons per houTo^^ This tyt>e of a pumping unit has been found economical to OTserate.

■^^Litohfield, L„ H. "It's the Cranberries" Powertrax, Inter- nationiil Harvester Company, Vol, 7> No, 1, p. 20 (April 1936).

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Sand

Another essential for successful cranberry cultivation is an ample, convenient supply of coarse sand. The sand layer lowers the level of fertility. Past experience has shown that growing cranberry vines in muck directly results in heavy vine growth with sparse setting of fruit. Weeds are more troubles<xne.

Sand is used as a mulch before the vines are set and for resanding in after years. Fine sand promotes the growth of moss and allows weeds to thrive mors than coarse sand.

On Cape Cod^ -where sand abounds around the swampsj, it is usually carried into the bog over a line of planks with special •wheelbarrows that have a pneumatic tire and balance load over the wheel; but railroads with gasoline locomotives and cars are often used on the large areas „ In Pacific County^ Washington^ where the sand underlies the swamps and is not available else- where, growers Dump it ud in water j, with a centrifugal pumpj and send it through piping^ in some cases over one-half mile.

The sand is soread over the bog to a depth of three or four inches o It has been foxind that the vines grow faster in the sand when it is no deeper than four inches and that they reach full bearing sooner.

The sand helps check weeds and moss; it gives the cranberry a medium to grow in, which can be drained and aerated better than peat, thus promoting their growth; it serves as a mulch and ao ameliorates drought; and it gives out heat at night so as to afford some protection from frost o Its pH (Hydrogen Ion Content) or Acid Content should be no less than Uo^ for a most advantageous growth factor.

Weather

Weather, in its known and unknown relations to cran= berry production, has always been a matter of much interest and speculation to growerso The xmceasing references to it through years in the reports of the meetings of the cranberry growers" associations and in other papers concerned with the industzy are ample evidence of thiso

The most recent study of the weather and its relation to cranberry production was completed by Dro Henry J, ■Franklin, research professor in charge of the Cranberry Station^ Wareham, Massachusetts, in 19U6c-^^ Temperature, precipitation, and sunshine

"Tranklin, Henry J,, "Weather and Cranberry Productiono" Massachusetts Agricultural Experiment Station, Bulletin No, Ii33i p„ 3, June l9ii6o

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were the only elements studied extensively „ The available data for humidity and wind seemed to be inadequate and apoarently •without much significance. The study embraced the cranberry- growing regions of Massachusetts,, New Jersey and Wisconsin. The differences in the weather relations of the cranberry crops of the different areas studied are surprisingly great.

Sunli^t is necessary for the normal growth of all plant life. The study disclosed that the variation in the amount of sunlight is considerably related to cranberry 'Dro- duction in New Jersey. Evidently^ reduced sunlight is seldom a limiting factor in that State, probably because of the more direct rays of the sun there.

The Massachusetts findings seem to show that the amount of sunlight in the year before that of the crop has an ^

important effect on the size of the crop and the keeping quali- f ' ties of the berries. This probably comes about- through the ^-:

build-up of the vines in starch and sugars. It annears to be one of the major influences that determine the amount and characteristics of Massachusetts cranberry crops. This may be due partly to limiting effects cf the frequent and -oersisting fogs that occur along the Massachusetts coast. The same rela- tionship was found between sunshine in the year before, the year of the crop, and cranberry Droduction in Wisconsin.

The studies disclosed no important variation in New Jersey cranberry crops due to temperature o Higher temperatures were found to be more destructive to cranberry production in Massachusetts. High temperatures occiirring in March may be partly nathological and may be related to unrecognized frost inj\iry in April. The harmful effect of high temperature in July is probably due to the burning of the flowers and small berries, which occurs rather commonly on the bogs in hot weather.

The effects of spring temperatures on the cranberry crops in Wisconsin are very great. It appears that high tempera- tiires in March of the year of the crop are very destructive. The very favorable effect of a warm spring in the year before the crop year suggests that in the years with cold springs the growing season in Wisccnan is not long enough for best results.

It appears that in all three of the cranberry-growing districts considered, with the possible exception of frost, excessive rain in the growing season has been the outstanding weather factor limiting production.

The weather elements are found to affect the size of cranberry cropSj, the size of the berries, and the keeping qualities of the berries. It is believed that the relations of those elements that seem to affect all three are most likely to be well established; these being the sunshine in the year before the crop year and the sunshine and temoerature of H'arch and the rainfull of July and August of the crop year.

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Labor

The cranberry grower requires a complement of full-time emolcyees. Their duties are the maintenance and care of the bogs during the growing season. During the frost season they are al- ways on call to flood the bogs to prevent frost damage and after flooding to drain the flooded bogs lest long water coverage of the vines smother them by cutting off their supply of oxygen „ During the growing season they are concerned with insects Pest and weed control, irrigation, maintenance of water ditches, storage dams and the water level in the ditches and also the maintenance of other bog facilities. During the harvest season they supervise the temporary workers engaged in picking, cleaning, grading and nacking the crop for shipment. The Wisconsin Survey, made in 19ii8, reports that about one full -time worker is employed for each 13 acres of bearing marsh. The average harvest crew for the I9I1.8 crop was 19 laborers per farm or about one laborer per acre, -'■2

It has proven exceedingly difficult to obtain accurate cost figures, primarily because few growers have made strict accounting of their costs, or that those growers who have made cost studies are reluctant to give their cost figures. The general estimate given by growers and others highly placed in the industry was that it cost between ten and twelve dollars to place a barrel of cranberries on the market, Again^ estimates vary as to the amount of this cost that is chargeable for direct labor. Some growers state that their direct labor cost amounts to sixty-five per cent, while others estimate as high as seventy= five per cent. During the past season, the prevailing wage for the migrant worker was $1,50 per ho\ir, which was an increase of twenty-five cents over the oreceding year. Wages for maintenance, sanding, weed and insect pest control, together with materials, sorays, etc., have likewise advanced. Labor is the biggest item in cranberry production costs.

Preparation

Fresh meadows and freshened salt marsh sometimes are made into cranberry bogs without turfing^, the grass being laid down and covered with about five inches of sand and vines set out without other preparation, except grading and ditching. However, the first step usually is the clearing of the land "turfing," or the removing of all surface vegetation, cutting deep enough to destroy all roots of noxious weeds. Then the meadow or bog is graded imtil it is level enough to permit in- \indation without waste of water, and to hold eight or ten inches

12

Estes, C„ W, , Morris, W. W^ "Wisconsin Cranberry Production

and Marketing," Wisconsin State Department of Agriculture, Bulle- tin Noo 299^ Po 2h, January-February 19^0,

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of fluid below the surface of the soilo This operation Iriplies of necessity a srystem of high dams for water storage purposes; of embankments to retain the flood; and of ditches to draw off the surplus during the season of growth „ This flooding with cold water delays the blooming of the plants until the danger of frosts is reduced; it prevents the plants from being "heaved out" by repeated freezing and thawing; it drovms out the eggs of devastating insects^ Without flooding, no succession of profitable crops from the same field is possiblCo Arat)le water supply is necessary in those localities where late spring frosts threaten and insects swarm„ It is necessary to blanket these bogs from November to May with water from a depth of eighteen inches to two feeto

After the land has been cleared of trees and brush, ditched and drained,, it is "turfed" or "scalpedo" Care exer- cised in this operation will pay dividends later on, for unless all roots of ferns and of all other plants are removed they are likely to give trouble later onj, as do wood weeds, such as horse briar, poison ivy, leather leaf, hardhack^ sheep laurel, and chokeberryo It is much more expensive to remove the second groTTth of this undesirable undergrowth after the bog has been planted and the vines are growings The work in preparation of the new bog should be done late in the summer after the native weeds have passed their seeding period or in the early fall.

The soil thrown out in ditching may be used in grading. The grading is done by the water line in the ditches„ All bogs should be made level j, so that they may be flooded quickly and with little water, and no swamp that cannot be so graded with moderate expense should be used unless the water supply is very amnlec If the swamp is large and much out of level, it is often best to divide it into separate areas, each nearly level, at different elevations according to the lay of the lando

Form and Size

Other things being equal, gnall bogs pay better than very large oneso Growers in Wisconsin with acreage of ^0 to 100 acres report higher yields per acre in 19U8 than those growers with either small or larger acreage „^3 Long narrow bogs^, after a certain size is reached, are more profitable than compact oneSc The care of large compact bogs and the harvesting of their crops are disproportionately costly, because it takes

^^Estes, Co Wo^o Morris, We W, "Wisconsin Cranberry Production and Marketing", Wisconsin State Department of Agriculture, p, 21^ January-February 1950.

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more time to wheel sand to the center of the bog and to bring berries from the center | also most of the bog operations call for more tramping over;, and consequently more injuiy to the vines on large blocky areas „

Another factor limiting the success of large bogs is the greater prevalence of the black-headed fireworm on thera„ Flooding favors this insect by destroying a fungus that often attacks it and by killing or driving from the bog most of its enemies, such as spiders and parasite s„ At the same timej it protects its eggs from the adversaries of the wintero The natural foes of the pest take longer to reach the center parts of a large compact bog again in effective numbers than to reach the center of the small one„ Ifj, hoTwever^ a large bog is long and narrow J, none of the factors mentioned are unfavorableo

Drainage

A bog should be well drained during the growing season. Poor drainage favors weed growth and the rose-bloom disease and probably promotes infestations of the black-headed fireworm and diseases irtiich cause berries to rot both on the bog and in stor- age „ It also curtails the growth of cranberry roots. The land below the bog should go down rapidly, so that the water may be drawn from the ditches quickly at any timeo

A ditch should be cut- entirely around the bog and other ditches dug across it, dividing it into sections„ The marginal ditch prevents upland growths from working onto the bogj, keeps many crawling insects offj, and is some protection as a fire line from forest fireso These ditches should be at least three feet wide and two feet deep. The water in these ditches also helps to create a fog in time of frost danger.

If the drainage from the bog is goodj, the cross ditches are not important 5 unless the area is great or the bottom close and sprlngy„ They hasten the distribution of water over the en- tire area in frost-flooding and irrigating. Without them, the water tends to pile up for a time at the end of the bog where it is admit ted „ They usually should be 100 feet or more apart, and are made about two feet wide at the top,, one foot wide at the bottoms and eighteen inches deep. One of them should be wider than the others and run lengthwise along the bog, in the path of the direct flow from the water supply to the outlet., to hasten flooding and draining o No more ditches should be made than are necessary because they waste land and interfere with bog operations.

Few bog owners in ffassachusetts have used land-tile to improve drainages, possibly because of. its costj, but its use on spring-bottom bogs should be considered. A few tile lines would help distribute water from the ditches during the dry periods Tf*iich occur in Jvly and August „ The tile should be three or four inches in diameter^ and lines should be 25 to 30 feet apart and not over 18 inches down. Coarse sand or gravel should cover the tile.

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Dams

The reservoir and bog dams usually have a -nide core of sand walled on both sides with turf. Sometimes, turf is necessary on only one side^ The turf walls are built layer on layer with some sand between for ballast, and nieces of ad- joining layers overlapping,, The turf is taken quite often from the upland near the bogj but when the swamp itself is scalped, the turf obtained may be used partly in facing the dams.

A trench deep enough to reach below all tree roots should be dug along the middle of the dam location and filled with sand to make a good connection with the soil for holding water. If the dam is to cross very soft land, it must be sheetpiled lengthwise in the middle, with matched boards or planks. It should have sloping sides and be widest at the bottom, with dimensions according to the head of water. The wider it is, the better it will resist muskratSo It should be a foot higher than high water to keep waves from wearing a hole in the top. It may also be used as a roadway. It is well to ditch the bog a few feet from the dam making a berm.

A flume for the passage of the water must be built in the dam - a job which requires an experienced gate builder, for it must be made properly and carefully. It often pays to make the gate of reinforced concrete, but redwood or kyanized cedar lumber is better on soft land, A continuous sheet of matched piling under the middle of the gate and extending out into the dam on each side of it is necessary. Two or three sheets may be needed if the water held is to be deep and the soil under the gate is soft or disturbed by springs. A stream of water from the hose of a power sprayer, delivered under high pressure, through a piece of iron pipe with its nozzle compressed to a very narrow slit, helps greatly in driving the piling by loosen- ing the soil.

The most experienced growers prefer the covered or trunk gate, which is much stronger than the open gate and rots less when made of wood. A concrete bulkhead opening into piping is advisable in some places. The outlet gate must be large enough to cariy off the water of the heaviest rains and of flowages quickly. Stop-waters in bog ditches often help greatly in efficient use of limited water supplies in frost flooding.

Varieties of Cranberries

Both Early Black and Howes^ are much more important than all -the other varieties combined. Early Black is the standard early variety and Howes is the standard late variety. These varieties will remain in prominence for a long time, not only because they lead in acreage, but also because their fruit is favorably known by the trade everywhere. The principal

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variety grovm in Wisconsin and on the West Coast is the McFarlin, Early Blacks and Howes have been widely planted in New Jerseyc

Varieties with fine vines^ short upright branches, and low seed co\mts and without noticeable bloom on the fruit are generally superior in production and disease resistance „

A large number of new varieties^ selections from the wildj and crosses between cultivated varietiesj, are being tested for future planting by the Bureau of Plant Industry of the United States Department of Agriculture „

The varieties vary in ripenings the earliest usually becoming well colored the first week of September^ and the latest the third week in Octobero Some berries color well in storagei others will not redden much unless left on the vines. Most cranberries are first greenj, then whitish, then pinkj then light red, and finally dark redo Some wild cranberries are whitej, when ripej, and some cultivated ones get so dark that they are almost blacky The different kinds of berries vary in formj being pear-= shaped, fusiform^, ovalj, or rounds The round berries are most easily sorted »

No flooding area should have more than one variety. Some of the leading varieties have insect or disease troubles which are especially bad with them, and planting other varieties on the same flooding area complicates controls.

Vine Settings

Virgin meadows are rarely started in any other way than by cuttings, naturally « the plant reproduces itself by offsets. The vines are usually planted late in May or early in June and are usually set eight to ten inches apart each way. With this spacing it takes about ten barrels to plant an acre,, depending upon the condition of the cuttings and the efficiency of the setterSo The closer they are set, the better they will anchor themselves against the pull of the picking scoops. Fairly close planting seems to favor high yields^

The cuttings should be taken from a bog that is in

good condition,, being free of variety admixturesc, firewonnsg

gypsy moths^ rose bloomg axid false blossorao If it failed to

yield well the year before, all the better^ cutting from such

vines seem to come back wello It should possess a record for nro- ducing good crops of sou.id fruit.

Bogs from whish vines are cut recover within the en- suing growing season^ with no appreciable loss in their productiv= ity.

The cuttings are pushed well into the sand with a wooden or iron dibble. They need not stick up from the sand more than one incho Again,, satisfactory results are obtainable by spread- ing the cuttings over the bog and disking them in. This saves labor and time, but wastes planting material.

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Irrigation

Bogs are too wet oftener than too dry. They do, how- ever, often suffer from drought, especially in August. The berries being reduced in number and size and retarded in ripen- ing and the vines drying in severe cases „ Occasionally, light flooding for a few hours at night followed try complete with- drawal of the water is sometimes done, but it is usually better to hold the ditches partly flill throughout dry spells. Watering with a sprinkling system, though costly, is effective for bog irrigation and frost protection » Irrigation as practiced on the West Coast is mostly by forced overhead ^sterns in contrast to the other cranberry growing sections of the country, where they depend mostly upon natural gravity flowage for irrigation.

The general experience of cranberry growers in the State of Washington, viiere sprinkling systems have been used on the cranberry bogs in recent years, is that irrigation, by sprinkling on hot days, helps greatly by preventing sun scald- ing of the berries and definitely improves their storage qualitieso

Cost of Building the Bog

The cost of building a cranberry bog today would be similar to other building costs, that is, it would be sky high. This cost would depend on the natural conditions and locations of the swamp, on the ability and experience of the man who over- sees the work, the extent of use of the labor-saving devices and the efficiency with which they are used, and on the wages, A good bog, well located and built, olanted with the right varieties, and given good care, should be nearly permanent. There are bogs on Cape Cod and in New Jersey nearly one hundred years old and still in good condition. To own and properly manage cranberry property requires considerable investment and special experience which it takes years to acquire. Costs studies of building Cran- berry Bogs in I9U8 were estimated as follows;-'-^

Cost per Acre

Land, , ,....,... . „ , . $ 10 - $ 100

Clearing, ditching, turfing, grading, sanding . 8OO - 1,800

Ten barrels of vines at $10 per barrel, , . . , 100 - 100

Planting vines. ,. o,, ,,,,-,,.,, , $0 ~ 200 Incidentals (tools, dsms, head-gates, building.

Total , o o ,,,,,, o ,, o ,,, . $1,360 - $3,000

■^"ranklinj Henry J,, "Cranberry Growing in Massachusetts," Massachusetts Agricultural Experiment Station, Bulletin No. Uhli D, 21, April 19li8,

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Care of the Bog

Water should be put on right after plant in gj held near the surface a day or so to wet the vines and pack the sand around them, and then drained to the bottoms of the ditches » If the bog is flowed again the first season^ it shoiild only be for a day or two to wet the sand or control the insectSo

New bogs should be flooded for the winter as soon as the ground begins to freeze, for frost in the soil heaves new set-outs. The surplus water must be left off at time of heavy rains in winter or early spring. If this is neglected with the vines frozen into the ice, the rising ice will pull them out of the ground. During the first three years, the winter flowage should be left off about May 5, or when the danger of frost has passed.

More weeds grow on a bog the first two or three years than later, for the vines have not grovm enough to crowd them. They give relatively little trouble afterward if they are kept down theno A grower should know the weeds he has to fight at this time, for it is enough to mow the tops of some kinds (mostly rushes), and some (rice cut-grass) can be checked by good drainagei while others must be rooted out or killed with salt (ferns, bramblesj hardhack, leatherleaf, and sheep laurel) or kerosene (grasses and sedges). Upland weeds often appear on new plantings^ they need not be heeded, for they will die in the winter flooding. Weeds along the ditches may be effectively treated with dry salt.

After the first year and before it comes to bearing, the new planting should be flooded several times each season to check insect pests.

Constant roguing is necessary the first three years to remove plants of odd varieties and hills with false blossoms. The new bog should be sanded with two-thirds of an inch of sand right after the first crop is gathered to make the vines develop a strong root system and become firmly anchored.

Fertilizers

Profitable cranberry production requires careful atten- tion to many details anong which proper fertilization is of tre- mendous importance.

The application of fertilisers to cranberry bogs results in the first season in an increase in the number of berries which remain on the vines, in a marked increase in the size of the fruit, and in a better set of fruit buds - the basis for the next year's crop. Cranberries thrive best on acid soil, and under such condi- tions it is likely that they do not take up any considerable part of their nitrogen in the nitrate form. Recent experiments substan- tiate this idea. Flooding of the bogs is unfavorable to nitrifica- tion as the air is excluded from the soil. Water and organic matter

.19=

both destroy nitrates. The cranberry thrives best -when it gets its nitrogen in the form to which it is naturally adanted and to which it is accustomed to useo

The flood waters readily carry away soluble plant foods from the soil, and for this reason the annual application of ferti- lizer to cranberry bogs is necessary,, Furthermore^ fertilizer apolications *ould not be made in the spring until after the last flooding, for greater yields are only obtainable then, and when applied as evenly as possible when the vines are dry. Some growers are experimenting with fertilizing in the fall after the crop has been harvested and they are claiming satisfactory results.

Re°Sanding

Sanding cranberry marshes had been a common practice in the eastern states long before it was introduced in Wisconsin. According to Andrew Searls„ the first sanding in the Berlin region of Wisconsin was done by Ralph Smith about 1890, Sanding has been done in the Washington-Oregon districts since they began commercial nroduction in the mid=twentieSo

As the cranberry roots form a dense growth in the sand over the peat«, they become soil boimd, and resanding gives them more soil to grow iiio Largely on this account, re-sanded vines are generally thriftier, tend to improve the quality of the fruit, increase yields as well as improve the bog surface. Moss and fallen cranberry leaves are poor conductors of heato Bogs not re- sanded regularly are commonly well covered with such material and are very liable to frost injuryo

The oftener re-sanding is done, the moi^ it protects against frosty the girler, the green spanworm, and the tipworm. However, bog conditions should determine the frequency of re-sanding. Bogs with little water for reflooding should be re-sanded lightly every year; those with plenty of water for frost and insect flood- ing and witti moderate vine growth should be re=sanded every three or four yearso Bogs with ample water supplies and heavy vines should never be re-sanded^ Re-sanding is dene to a depth of a quarter of an inch to an inch, and is mostly applied during the wintei*, when the bogs are frozen, to permit trucks to drive over the bog.

The cost of applying the sand varies from $30^00 to $100oOO an acre, depending uoon labor cost, the availability of the sand bank and the method used to get it onto the bog,

A new hydraulic bog-sanding machine is under development by Professor Herbert N, Stapleton and Professor Earle Cox of the University of Massachusetts. The machine mixes sand with a heavy flow of water which is distributed over the bog by means of jets. It is expected that when this machine is perfected it will save growers almost two-thirds of their cost for sanding.

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Disease^ Weed^ Insect and Pest Control

The cranberry grower like all other farmers had to con- tent himself with an ever oresent crop of weedso However j, he has ways and means not generally available to the average farmer of doing something about their growtho ^or example, by holding the flood waters on the bog until late in the springy weed growth is reduced! also^ at the same time, the fruit worm;, the false army worm and fungus disease are controlled. As in all farming^ there is the ever present specific for weed control know as "hand weed- ing." New bogs until they have obtained a heavy growth of vines must be kept relatively free of weeds o Fall weeding of the wood vines is practiced in the Massachusetts region.

Recent developments in the use of insecticides and fungi- cides have made a great contribution to cranberry productiono New techniques in the application of these disease and insect controll- ing materials are being perfected„ Today j, dusting and spraying the cranberry bogs with the use of helicopters and airplanes is practiced on larger bog acreage. Ground equipment is used advantageously with the newer developed chemicals on the smaller bogs. Such new chemi- cals as DDTj PDB^ and the older sodi\m cyanide, rotenone^, cryolitej, arsenates j, arsemites,, sulphates^ bordeaux mixtures^ fermate^ water ■vi^ite kerosene and Stoddard solvent are enlisted in waging war against the enemies of successful cranberry production. Each chemical has its worth in varying degrees of effectiveness. It is beyond the piirpose of this paper to describe the technical phases in the use of these chsnicals in insect, disease and weed control measures.

Research is being carried on toward developing a uniform droolet for insecticide sprays „ A uniform droplet would prevent waste of spray materials.

Cash Outlay Before Initial Harvest

A new planting comes into bearing the fourth year. We have seen that it costs the grower in 19kQ from $1(,360 to $3^,000 an acre to build the bog. It further costs him from $100 to $200 an acre each year to care for the bog until it crops. There is then invested in a new bog before it begins to give the owner a possible return on his investment from $1,800 to $3 ,,800 an acre„^5 With normal crops it is estimated that the bog will pay these costs in a ten-year period.

Today, in the Massachusetts and the New Jersey districts, there are few new bogs being made and put into production. Increased

1^

Franklin, HeriTy J., "Cranberry Growing in Massachusetts,"

Massachusetts Agricultural Experiment Station, Bulletin No, hhls p, 21, April 19U8,

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bog acreage is reported yearly in the States of Washington, Wis- consin and Ore gone

In the eastern-growing regions bogs nearly 100 years old are being onerated profitably^ but many of this age are in too poor a condition to produce wello The difference may be due to nersonal and physical factorSc, Good property may deteriorate through misnanagementj, or a property may be unsatisfactory because of an unwise choice of bog siteo Yearly a greater emphasis is being placed on bog renovation of these older^ \inprofitable bogs. The making over of an old bog that is in a good location may call for the destruction of all growth on the bog, grading^ draining, sandingj and complete replantingo Unproductive bogs can sometimes be returned to a profitable condition by merely following good management practices „ Complete bog renovation costs range from $500 to $lj-,000 an acre now depending on the wcrk required »

Cash Costs of Bog Operation

B„ Do Crossmonj, research professor of Farm Management at the University of Massachusetts, in a recent study of actual direct costs for the 19U8 crop season, revealed that the actual cash out- lay for the part-time operator having an 8o5-acre bog and doing all of his own labor, excepting that required for the harvest, was $1;.20 oer barrel) for the commercial owner-operator having a 13-acre bog was $3ol5 per barrel ^ for the commercial owner employing two regular men, having a 20-acre bog was $5<.79 per barrel; for the commercial operator and employing 2 regular men but having a bog of 30 acres, this cost was $llio60 per barrel; for the commercial operator em- ploy ing an operator and four men on a 58-acre bog, the cost was $9ol5 per barrel 5 for the corporation employing ten regvlar men plus the required seascxial labor on a bog of I8i| acres, the cost was $7o00 per barrel o

The annual cash costs of bog operations covering Six Case Studies, (See Appendix A, Exhibit 1), amounted to $1,720 for the part-time operator who did his own labor, a non-cash item, to $70,Ii25^Q0 for the corporation which was required to hire all its labor. '

■'■^omlinson, Bertram, "Renovation of Cranberry Bog," Cape Cod Exten- sion Service, Special Circular No„ 55^ P« 6, April 19ll6«

'Crossmon, B^ D„, "Production Costs - The Area of Owner Control," Cranberries, Vol. 15, No^, 9, p.. 7, January 1951.

CHAPTEH IV

CRANBERRY HARVEST

Picking Season

The cranberry picking season is relatively shorty ex- tending from raid-September through late Octobero The harvest period is so short that many growers^ especially if the season is late^ have to begin when the fruit is only partly coloredo The berries grow sweeter and larger as they ripen, so that the later they are picked^, the better the sauce they will make and the greater the yield, Craiiberries should be gathered only when the vines are dry,, A frosty night oompels the flooding of the bogSs and usually little harvesting can be done the following dayo Berries picked late in the afternoon have better keeping qualities than those picked in the heat of the dayo Howeverp there is a definite period when certain varieties should be harvested^ for experience has shown^ over the years^ that the keeping qualities of the berries depends in a large measure upon the time and the humidity conditions when they were pickedo

Methods of Picking

Cranberry picking was done by hand until fifty years ago in the eastern=growing regions and in Wisconsino The methods of harvesting vary somewhat throughout the growing regionso In Massachusetts and in New Jersey the picking is largely done with the use of "scoops,," The pickers move through the bogs on their kneesj pushing scoops before themo They proceed with a rocking motion as the wooden prongs comb the berries from the vines. An exoerienced picker^, one who harvests fast and yet is careful of the tender vines^ can average as many as one hundred pounds an houro The record for individual picking with the regular scoop was made a number of years ago when an unknown Portugese j, who worked in the Pleasant Lake District of Massachusetts^ picked $1| barrels of cran= berries o A barrel weighs 96 pounds^ sOj in pounds j this Unknown Cranberry Harvester picked ^plSii Doundsj, or more than two and one= half tons„l8

■^"Dickey J, Arthur Go? "Cranberry Picking IVowness of Unknown Portugese Legendary," Reprint from the Cape Codder ° Food Marketing in New England, (November 1951)? Volo 12,, Noo S? Po lOo

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After the picking season is completed in the above states, the bogs are flooded to a depth of six inches, so that the cranberries dropped from the scoops during the harvest, can be gathered. In this operation, the resourcefulness of the cranberry grower is brought to the fore - they make use of a boat to gather the final berries!

The boat is shallow, has an airplane engine and propeller and is steered with a long rudder „ The boat is raced at a speed of about forty miles an hour over the bog to agitate the water enough to release the berries caught in the vines during hand harvesto The breeze made by the propeller of the craft blows the berries to the edge of the bogs and the workers null them in with long-handled rakes. The gathering of these "floats" which are carefully screened and made into cranberry sauce within a few hours after they are gathered^ represents an important saving for the growerSo Sometimes by flood- ing, and with the use of the race boat, a grower retrieves as much as 10^ or 20^ of his crop which otherwise would be losto This part of the harvest is not of premium quality and, accordingly, the returns are correspondingly less„

In Wisconsin, the cranberry bogs are flooded so that the tips of the vines are above the water and the berries float near the surface. Pickers then wade through the water, raking the berries from the vines with a scoop using long sweeping motions. Because of the dry Wisconsin air, the berries dry off in a few hours.

In Oregon and Washington most of the berries are water scooped. This is a cheaper method of harvesting when the berries go to the cannery. This is little loss of berries when harvesting is done in this manner. On the other hand, when the berries are sold in the fresh market, they have to be dry scooped or picked with a mechanical picker, both of which methods entail a loss of at least 105? of the berries left on the bogc.

Mechanized harvesting, although in the experimental stages, is gradually being r)erfected and is finding greater use on the bogs of Massachusetts. One of the reasons for retarded mechanization on the bogs of Massachusetts and New Jersey may be the large numbers of snail, individually owned bogs, with tiieir irregular shapes. Machinery for the limited use on the small bog might require exces- sive capital investment. The WestemPicker, delivered in the East at the present time, requires a cash outlay of $1,0^0 ,,00. Most ooerators estimate annual repairs and depreciation at one-tenth of the machine's purchase price. A related reason for the retarded mechanization in the East may be the unwillingness of manufacturers to go through the heavy initial expense of producing a machine for which there would be only limited sales.,

Mechanization of the harvesting has found greater use in Wisconsin, Oregon and Washington, where the bogs have been better laid out. and the machines can be used to a better advantage. Again, their yields per acre generally are greater than in the East.

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yieMs

The yields of cranberries per acre vary over the several producing regions, as set forth below;-'-°

Acreage Harvested

Yield per acre

Price for Crop

Received by Grower Average Average Average

1938-U7 19I18 19i;9 1938-U7 19U8 19li9 1938-li7 19U8 I9U9

Mas So N. J. Wise, Wash. Oregon

5 states

Acres

11,220

7,970

2,610

680

169

Acres Acres Bbls.-»

Bbls.-» Bblso*

1^,000

7,800

2,800

700

260

I5,ii00

7,500

3,100

700

320

30„8

9.6

i;2.2

61i,0

U0,3 808 85.0 60.6 51,2

33,8 8,9 61i,5 57,1 ill. 9

16,80 16. UO 17.70 15.70 16,80

9o90

10.20

10,90

8,05

9.30

8.70 8.50 11.20 7,IiO 8.50

25,61i9 26,560 27,020 25.9

36.1; 31.1 16,80 10,10 9.20

•^Barrels of 100 pounds

The average production for the 1938-I;7 oeriod -mas 665,230 bbls,; for l9U8-967,700 bbls,; for 19li9-8IiO,i;00 bbls.j T*iile for 1950 it was 98U,30O bbls,; and the production for 1951 was 932,500 bbls. The price received for the 1950 crop by the grower was $10,60. The 1951 crop opened at $15.00 per barrel and reached $20,00 per barrel before the marketing of the crop closed.

The average annual acre yield of cranberries in Massachusetts ranges from 30 to UO barrels, but wellnnanaged bogs, with the proper facilities, probably average over 50 barrels in a series of years. The average yield is somewhat larger in Wisconsin, Oregon and Washing- ton „ The differences are due partly to natural conditions for the industry and partly to methods of culture. All the cranberry bogs of Massachusetts are sanded and most of those in Wisconsin are covered with sand. New Jersey, Oregon and Washington bogs are only partly sanded because of the relative lack of suitable and accessible sand banks. The climate is rather xinfavorable in New Jersey, promoting more weed growth and fungus troubles than in other cranberry districts. These factors are, in a large measure, responsible for the low acre yield in New Jersey,

Wisconsin is well placed in the industry and may be a long- term rival of Massachusetts in its annual production in spite of its troubles with drou^t and summer frosts; its geographical location

19 ^United States Deoartment of Agriculture, Agricultural Statistics,

1950, Table 2i;7, p. 205, ~~

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gives it an average freight advantage in the delivery of the fniit to the markets of the country as a ■wholei its Searls variety, partly because of its large berries^, is more productive than any other cran- berry variety largely groimi the crop is harvested more completely with less injury to the vines than elsewhere by water-scoopings yielding in IpiiSj, 99 oh barrels per acreo Then again, Wisconsin shows greater new bog acreage under production yearly than do the Eastern regionso The new bogs are principally planted with the Searls variety, which yield heavier returns than the old oneso The other high yield variety planted in Wisconsin is the Howes which averaged 90o2 barrels per acreo

The cranberry crop in Washington and Oregon has no pressing cultural problemso The climate there is not a hazardous one for cran^ berry growing^ because the climate has few extremes in temperature « The problem of frosts must be contended with„ However, a method of control was devised in 1925=26 by sprinkling^ which has proved very satisf actoryo The bogs are not flooded as in other growing regions, but when frost threatens and the temperature reaches 32°Fj, the bog operators start the sprinklers and operate them continuously until the temperature gets back to 32° or 33**Fo This method takes cstb of temperatures as low as 25° and that is about as low as they are concerned witho These factors coupled with control of insects and disease, together with good soils are the principal reasons for their crop yield averages per acre of over 52 barrels, over a twelve- year period o

Labor

An army as numerous as the legions of King Frost must be hired for the ^ort picking seasono This mustering of the needed pickers presents a serious and difficult problemc The cranberry grower's staff of full-time workers, irtio take care of his bogs during and after the growing season has on hand a nucleus of trained workers who are capable of supervising the pickerso These pickers are employed on a temporary basis during the harvest seasono

In the cranberry industry on Cape Cod, the people of Portugese blood play a large parto These latter, unlike those on Provincetown, who mostly follow the sea, are known as Bravas, des= cendants of part-Portugese, pari- African inhabitants of the Cape Verde Islands^ who were brought to the Cape as labor for the cran- berry bogs in the latter part of the last centuryo Of course, it cannot be expected that these people will sit aroiind idle just waiting for the annual cranberry picking season for employment o The vast majority of these people operate small truck farms, or are otherwise gainfully employed in the other seasons of the year,, Of recent years, the imported PuerHbo Rican laborer has been used with satisfactory results^

The New Jersey grower depends for his seasonal help in a large measure on the importation of Italians from nearby cities, such as Philadelphia^ In Wisconsin, Oregon and Washington the crops are to a large degree harvested with hand rakes, after the bogs are floodedo However J, these growers depend upon the local Indians and migrant farm laborers as the principal source of their needed harvest laboTo

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All growers are interested in cheap labor, relative to the selling price of the fruit harvestedc Cheap labor is not the com- plete solution, for this labor is more likely to be available when prices and business confidences are falling,, Labor generally shies away from picking cranberries, for picking cranberries with the "hand scoop" is hard, back-breaking work, and the toil of harvesting has been practically confined to strong meno The grower to get his help today must enter into the high cost labor market, which directly results in a lower net income per barrel of cranberries o

Important factors in maintaining a labor supply on cran- berry bogs ares (a) A plan for bog improvement that will increase yields per acre. In all branches of farming anything that improves yields tends to improve the labor situation,, (b) A satisfactory solution of the housing problem for the imported laborer, (c) More use of labor-saving equipment and methods so that men commanding higher wages can be used profitably and more work can be accomplished per man-day worked, (d) A strong^ active maintenance program will provide work for more year-round men^which will improve the quality of the work done, and the crop also.

Cost of Hand Harvesting vso Cost of Mechaninal Harvesting

Cranberry crops for the past three out of four years have yielded few dollars over harvesting expenses. For some bog operators it has meant deficits. In some cases the choice of operation yield- ing the least loss has been the most profitable one,, An example of this is the case where a deficit for the total cranberry crop is certain, but the value of the harvested crop is more than the cost of the harvest. Here 5, the margin of value over harvest cost can be used to reduce the total crop deficit.

The most expensive operation in cranberry cxilture is the harvesting of the crop. Part-time operators and those having small bogs m^ be able to do all the work prior to the harvest without hiring laboro However, these operators know that the time for har- vesting is limited and they must normally hire labor for this opera- tion.

Operators of the large bogs tend to hire considerable labor for the operations prior to harvestingo Even on the larger operations harvest labor may be over 2$ percent of the total labor billo The total labor bill, in turaj may be between 60 percent and 70 percent of the total cash expenses.

The higji cost of harvesting relative to costs of other cranberry operationsj, and low return for berries in recent years are factors to be considered in determining how the crop should be hairvested, When cranberries sold for $30oOO a barrel, the operator

^^Doehlartj, Charles A,, "Looking Ahead to Some New Cranberry Research," New Jersey Agricultural Experiment Station, po 7,

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had less objections to a high price for seasonal labor. Recently^ however, cranberry returns have been low and this situation has influenced the operator to risk more efficient methods in harvestingo

Another reason calling for a change in harvesting methods is the difficulty in obtaining good experienced hand scoopers„ Laborers, who formerly worked several months of the year on the cranberry bogs, have soTight other employment becuase of the curtailment in the use of regular labor on cranberry bogs in recent years » Also, rising wages outside the cranberry industry have attracted workers from the bog operations o There- fore, it is difficult for the small bog operator to locate skilled scoopers for the limited time during which he needs them, and for the wages he feels he can afford to pay. The large bog operators have some advantage in hiring labor because they can promise longer employmento

The need for the bog operators to ctirtail certain uses of labor or to substitute machinery for men is obvious o Mechanization has been slow in the cranberry industry as ccmpared with other agricultural enter- priseso Tteasons attributable for this lag in mechanization are the large number of small bogs, their irregular shapes, and the cost of the neces- sary machinery are the chief factors in the Eastern growing regionsc Here, this problem has been partially solved by cooperative ownership and custom ©Deration of machinery on a rental basis

During the fall of 19^1, Professor Bradford Dean Crossmon, research professor in "Farm Management" at the University of Massachu- setts, made a study of the cost of harvesting by the Western Picker as against the cost of hand methods of harvestingo In this study, comparative costs were obtainedj, which embraced the use of this mechani- cal picker on the operator's own bogsj on other bogs using custom operators. Comparative studies were diligently made on the factors of owning the mechanical picker outright and using it on a rental basis. The findings were generally satisfactory^ All operators were pleased by the savings in labor expense and the lesser dependence upon hired labor. The summary of opinion was that there is no serious bruising by the machines, if the operator is careful and does not attempt to operate the machine at high speed, such as li„8 hours per acre. Mechani- cal breakdowns, as was to be expected, did occur, but because of dealer reulacement policy the major cost was loss of time^

Two points stand out in this studyo First^ the machine har- vests an acre almost at a constant rate, regardless of yieldo This means an acre under noimal conditions, not with wet or frosted berries or extra long, heavy uprights. The noimal rate seemed to be about ten hours for the machine to harvest an acre. The range was from Uo8 hours to 20 hours. Barrels harvested per hour per machine varied from 3,6 to 18„ The yield is important in determining this figure, eog,, ten hours to harvest an acre yielding 75 barrels would mean 7,5 barrels per hour. The second point which standsout is the advantage in barrels per hour for the machine against hand scooping. Over a short period of time and on heavily yielding bogs a hand scooper might keep pace with the machine, but the human being tires and the machine can con- tinue at its nearly constant rate. Even the lowest figure for the machine, 3,6 barrels per hour, is nearljytwo and one-half the 1,5 barrels per ho\ir commonly expected from hand scoopers o

Translated into dollars at a rental figure of $200 an hour, a machine hired for ten hours, or $20,00, diould harvest a bog yielding

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U8 barrels. Adding the cost of gasoline at five cents an hour or fifty cents, and an operator at $1,$0 an hour -would give a total of $33.50 or about seventy-five cents a barrels Hand scooping would have required approximately thirty hours at a cost of $1^2,00 or ninety-three cents a barrel. In either case ^ wheeling the berries to the shore and screening would be extra. At lower yields^ there would appear to be an equalizing point between the machine and the hand scoopers. Actually^ that would be true, if the human scooper could maintain a harvest of 1.5 barrels per hour^ regardless of the lowness of yield per acre. But this is not supported by evidence ob- tained. Total costs of machine harvesting per barrel ranged from twenty-eight cents to $l<,$Uo In the latter case, the yield was only 28 barrels to the acre and it is doubtful if hand scooping could have done the job anywhere near as reasonablyo

Two small operators liked the flexibility possible with the machine. It left them largely independent of hired workers. Working alone, a quantity of berries could be quickly picked by the machine, wheeled to the shore and screened. Plans to extend the harvest could be made without having to cope for extra workers on certain dates. More of the labor becomes a non-cash expense, either that of the operator or his family, 21

Storage

The berries as they are picked are dumped into bushel boxes on the bog, the boxes having slits in the sides and bottom for ventila- tion and slats at the ends for handling and for spacing and stacking. These boxes are promptly removed from the bog and taken to the packing house (screen house). The building, if tightly constructed^ should be kept closed on damp and warm days and be well aired on cold nights, with forced ventilation. The more modern storage sheds are lined with insulating material to maintain moderate temperatures. Cold storage for this fruit is practicable. The berries keep best at a temperature of 35° Fahrenheit, but they color best at from k^° to 50°^ The berries seem to have better keening qualities in those years when the general crop ripens late or iniien it is made up of small berrieso Care is exer- cised to avoid too great a change in the temperature during storage lest the berries sweaty, increasing the incidence of rotj, and generally impairing their keeping qualitieSo It has been found that berries keep better after cold storage than after common storage. If there is a larger crop than the fresh market will take, the berries are frozen and stored \intil needed. The fruity, once frozenj, can only be used for canning.

21

Crossmon, Be D„, "Harvesting Dollars or Deficits," Cranberries,

October 1951, Vol, 16, Noo 6^ po Hi,

Preparation^ Standardization and Grading

In preparation for raarketj the berries first go through a separator, which forces air through thenij, blowing off the stems, and rubble gathered in the harvest„ The next step in the cleaning process is the separating of the decayed fruit from the solid fruit o This is done by rolling the berries down an inclined plane where the sound fruit bounces over the bounding boards, and the imperfect fruit is trapped at the base of the bounding boards^ This method of separating the sound fruit from the imperfect is unique to the cranberry industry. The ranaining step in nreparing the fruit for the market is the grading and the packaging.. Most of the berries, however, must be hand sorted. Experiments are being conducted toward solving the problem of mechani- cal grading. It has been found that cranberries are responsive to a magnetic field and once the method is perfected, it will go a long way to reduce the grading costs. Packaging is done by automatic machines.

Interim Crops

The cranberry growerp who cultivates ten or more acres of bog has a full-time job in taking care of the day-by-day work and is not free to give his attention to the growing of other crops. How- ever, the smaller grower„ who does most of his own work, usually is engaged in raising some other crop, that matures when the demands for his tine and labor are not required in the bog operations. We have seen in New Jersey that cranberry growers have branched out into blue- berry culture, while in Massachusetts this side line has not been developed to the extent that it has been developed in New Jersey, Strawberry culture has been highly developed in the Cape Cod region in Massachusetts, both by the cranberry grower and the part-time em- ployee. In this region, lAiere the land is fertile, both the part-time operator and the part=t3me employee are engaged in truck gardening. Again, we find the part=time operator and the part-time employee en- gaged in the poultry business.

It is difficult to assess the value of these side lines of the cranberry grower or the part=time employee, as tiieir produce is principally sold at road-side stands and no records or reports of such sales are generally made. There can be no question about their value to the individual, for they keep their same road stands year after year. These interim crops also serve as an anchor in holding the small grower in the cranberry business and likewise keep the part- time employee from seeking employment in other fields, -^t is an asset to the cranberry grower in these days of a mobile labor to have availa- ble experienced oart^time employee So

The cranberry grower could add to his annual income by placing idle sub-marginal land into production by planting the fringe areas around the water supply and the sand banks with a species cf the pine tree. The grower could plant the fast growing slash pine seedlings, which often attain a growth in height of twenty-four inches during the first year. Again, consideration and thought could be given to the possibility of planting these areas in a variety of the pine suitable

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for Christmas trees. This type of pine has a slower growth than the slash pine or the white pine. However, in the long run, this Christ- mas tree type of pine would result in another cash cropo Planting of either type would also tend to hold the water in the land and re- duce soil erosion.

Through state nurseries, the growers could obtain seedlings for fifty cents a thousand up to 5,000 and at $2o50 a thousand for additional requirements. Mechanical planting of these seedlings costs f7»50 per thousand, which is the number of seedlings used per acre. Thus, for the first five acres, farmers coxild replant their idle land for $8,00 per acre. Since the Production and Marketing Administration makes a payment of $5o00 am acre to farmers to encourage tree plantings, the net cost for five acres would be only $3o00 an acre. Above five acres, the net cost would be about $5.00 an acre.

That this is a good investment can be seen from the fact that the value of the land goes up immediately, to more than offset the cost of planting. Moreover, it is estimated that $l5oOO an acre, land on which $3,00 an acre is spent in tree planting will sell for $30,00 to $35oOO an acre in five years. It is further estimated that within a period of eight to ten years, that under normal growth conditions, the spruce tree will have reached a height of six to ten feet where thinning can be started and the trees become available for the Christmas market. It is estimated that fran the first thinning, at the end of twelve to fifteen years, in the pine plantings, that $10,00 to $20,00 an acre can be realized from the sale of fence posts and pulp wood. Out of 1,000 fast growing pine trees an acre, about i;$0 are cut at the first thinning. Additional cuttings are made at subse- quent five-year intervals, to be used for telephone poles, piling, and eventually saw logs. After these thinnings, the mature trees left standing will drop cones and reseed the tract without additional plantings. If cutting is restricted, this assures a permanent woodlot,

A tree-planting program of this type would tie in very well with the cranberry grower, for the planting woiild be done during the winter months, when there would be little work on the bogSo

Again, another consideration is that a tree planting around the fringes of the reservoirs of the cranberry bogs would enable the operators in the future to borrow more per acre for their credit needs.

22pye, Herbert H,, "Fostering A Crop of Tree Farmers," Burroughs Clearing House, (December 19U9), Vol, 3U, No, 3,^ pps, 31 and 65,

CHAPTER V

PRODUCTION AND MARKETING Growing Areas

The 1951 cranberry crop in the United States is esti- mated at 932,500 barrels, canpared with the record crop of last year of 98U,300 barrels, but well above the 19li9 crop of SUOsIiOO barrels. The ten-year (19liO-19U9) average production is 728,800 barrels. In each of the three eastern states (Massachusetts, New Jersey and Wisconsin) production was below last year, but above average. In Washington and Oregon production was above last year and above average. No economic abandonment is indicated for the 1951 crop. 23 (See Appendix A, Exhibit II) „ From 19li9 through 1951 the crop average has been 881,800 barrels, which is a substantial increase in comparison with that of the ten-year period (1930-1939), of 603,600 barrels, or the ten-year period (I9UO-I9U9), of 728,800 barrels.

The three Irge crops in succession are without prece- dent in the industry. They were the results of a combination of favorable weather, better agricultural techniques, and the results of the efforts to increase production during the proceeding years, when the prices of cranberries were favorable to the growerso

The present developed cranberiy area of 15,U00 acres in Massachusetts is only thirteen percent of the land classified as muck soil.2U The extent of undeveloped muck lands in the state shows that there is much room for expansion as far as available soil is concerned; but flooding facilities, sand supplies, and drainage possibilities are as important as the matter of soil. The combination of all these factors are not always available where cranberry culture could be successfully carried out. The choice locations have been taken up, and expansion woxild tend in the long run to be marginal producers » However, if the ret\ims over the next few years are such as would warrant increased pro- duction, more acreage could be developed, and the best of aban- doned acreage could be put back into production.

^■^United States Department of Agriculture, Bureau of Agricultural Economics, Release, January U, 1952.

^Massachusetts Department of Agriculture, "The Cranberry Industry in Massachusetts," Bulletin 139, 19U8, po 5o .

31

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In New Jersey, increased production is rather doubtful. The 1951 oroduction ifas slightly in excess of the ten-year (19liO-192l9) average of 75,iiOO barrels, and 29,000 barrels less than the ten-year (1930-1939) aver- age of 105,700 barrels, ^5 The damage done to the bogs by the false blossom disease has been severe, the prevalence of weeds resulting in high harvesting costs and lower yields per acre; the abandonment of marginal bogs; the ten- dency of growers to turn to blueberry culture and truck garden produce. The downward trend in New Jersey production over a twenty-year span indicates a slow and continuous decline that will probably continue during the coming years.

Wisconsin has more non-bearing acreage that has not come into pro- duction from plantings in the recent years than any other producing region„ nil 1950, I1I3 acres came into production for the first tine and, in 1951 j 181 acres came into production for the first time. It is reported that 70 new acres are due to come into production in 1952 and an additional I16 acres are scheduled for the first harvest in 1953.^° Since it takes four years after a new bog is planted before it is ready for harvesting, cranberry production can only slowly climb, Wisconsin may in the next decade become the dominant producing region in the entire cranberry industry. There is ample room for new bog expansion in Wisconsin because this state has available maiy acres of suitable marsh lands, ample supplies of sand and sufficient water of the proper quality.

In Oregon, a limiting factor to increased cranberry production through bringing new acreage into production is the water supply „ Many growers have thousands of dollars tied up in dams, pumps, pipelines, sump reservoirs and sprinkler systems. Many acres planted in 19U6-19U7j ■»*iich have been neg- lected during the low prices of the past few yesirs, could be put back into quick production with prices holding irtiere they opened this past season, e,g„, $15.00 per barrel,

Washington has no pressing cultural problems and we can look for a steady growth there during the coming years. The operators have favorable weather for growth, proper muck and peat soils, and ample supply of water. However, proper sands are available, but for the most part these sands are not near the marsh properties. The growers also have a reasonably good mar- ket on the West Coast,

The oost of building varies from $2,000 to $3,000 per acre and has not changed materially during the last twenty years. Previously, the work was done by hand, but now much of the work is done by power machinery. The greater efficiency of the machine has held the cost of development from climbing as in most other construction. With bog acreage throughout the country selling at $1,500 to $2,000 an acre, there is no incentive to build additional bog acreage for possible profit from sales. With prospects of better berry prices in the immediate season ahead, bog values will undoubtedly rise, and their sales values will be more in line with the initial investments.

The general expectation in the industry is for a considerable future increase in the national cranberry crops. There are three basic reasons for this spirit in the industry?

1. Land under cultivation is still increasing in Wisconsin and on the West Coast.

25united States Department of Agriculture, Bureau of Agricultural Economics, Release, (January 2, 1952).

^"Estes, C. W., and ¥orris, W, W,, ^Wisconsin Cranberry Production and Marketing," Wisconsin State Department of Agriculture, (January-February, 1950). Bu-lletin No. 299. P. 18.

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2o Yields per acre are becoming improved due to better grow- ingj flooding and sanding methods, to improved cranberry breeding and research, and to new chemical developments in insecticides,

3o The basic consumer market for cranberries is still respon- sive to further promotion so that it is capable of absorb- ing larger average and peak crops; especially as better processing techniques make it possible to spread sales of canned cranberry products over a full calendar yearo27

Therefore, the high degree of concentration is explained by the fact that the peculiar requirements of the crop are met in on^y a limited number of locationso Outside these most favored locations, expansion of acreage runs up against steeply increasing costSo Fur- thermore, even where high net returns seemed to •warrant such exoansion, high initial investment costs tended to discourage and delay the open- ing up of new bogs in locations in which the soil and climate do not offer assurances of permanent profitabilityo

The factors which made for geograohic concentration and restricted entry were also responsible for concentration of bog hold- ings into fewer hands o The remarkable increase in yields during the past half-century was made possible only by more costly methods of productions involving higher outlays for bog construction and mainten- ance, and more expensive equipment for the protection of the bogs f^om frost, insects, diseases and weeds. This increase in fixed costs, coupled with an appreciable risk factor, which is characteristic of all specialty crops, has given a decided advantage to large-scale producerSo In all, there are at present probably not more than 2,000 commercial producers in the United States,^"

Channels of Distribution

Approximately ^6% of the two thousand odd growers in the country are members of at least one of the five major grower-coopera- tives of the industry I nanely, the three so-called "state sales com- panies" in New England^, New Jersey and Wisconsin, the American Cran= berry Exchange with common membership to theirs, and the National Cranberry Association which operates in those growing areas as well as in the Pacific Coast area.

The Grower^ members of these five cooperatives, produce about 705f of the crop,, The other 30% is raised by the Uh% of the growers commonly called the independents, °

'Booz, Allen & Hamilton, "Report of Survey American Cranberry Exchange", Wisconsin Cranberry Sales Company, April 19h5> P" lo

28'CrauQberry Skin Keens Its Shine, A Fair Parable," Food Marketing in New England, November 19U6, Vol, 7, No„ 3» Po lo ~

29.

BooZj, Allen & Hanilton, The Cranberry Industry, April 19h^s Po ko

Also cooperatives controlled almost 705? of the crop in each of the prior ten years. Of the total 19^0 crop of 981i5300 barrels^ of -which 5795i300 barrels were sold or shipped fresh by all shippers, the independents shipped 27I5688 barrels, or approxi- mately ii6„9/S of all fresh berries produced in the United States„^^ Preliminary figures for the 1951 crop as to what percentage was controlled by the cooperatives, and the percentage controlled by the independents are not presently available | however, it can be reasonably assumed tha the generiL percentages will hold true for the season.

Individual

In recent years the trend has been away from the grower to market his own berries^ The vast majority of growers do not have the facilities for preparing their berries for the market, nor the set=up to carry on the normal marketing functions, Today^ the t>eTcentage of the total crop is so small that it does not exert any great influence on the price obtained. The majority of the in= dividual growers^ either are members of one of the cooperative mar- keting agencies, or, they sell their berries through one of the several private distributing agencies.

Private Distributing Agencies

The independent distributing agency buys berries fron the growers, who are not manbers of one of the cooperatives and does the marketing of these berries together with those they have produced themselves. All standardization and grading is done by the grower and the berries are delivered to the shipping point upon instructions from the agency. They handle the berries of the growers on a commis= sion basis.

With the independents marketing approximately one-half of the fresh fruit yearly, they are in a position to influence the mar™ ket by selling their berries in a weak market, in order to obtain the best price. They have been accused at times of making sales by selling on consignment. In deals of this kind the berries sent to the jobber, or wholesaler, were sold at whatever price the dealer could unload them,, The dealer would deduct his commission fron the proceeds, and the frei^t, if shipped foO.b,, and remit the balance to the shipper. Practices such as this were very detrimental to orderly marketing, as espoused by the cooperatives.

Naturally, the manbers of the cooperatives always felt con- siderable resentment toward the independents, whose position permits them to derive most of the benefits of cooperation without sharing in any of the expense or responsibility. The independents grow and

^^American Cranberry Exchange, Annual Report, Crop Season 19^0, p. 5«

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sell their own berries, and anything they obtain through the coopera- tive efforts of member growers is incidental to their prime purposes. Often, the jobber's commision, with adjustments that often had to be made, exceeded the costs of handling the fruit through a cooperative! so in the end, they lost money by such saleSo They stand to benefit financially from cooperative effort only as long as the cooperatives control sufficient production to maintain the market. It is usually contended that those, who do not belong to the major cooperatives move their berries by underselling the major cooperatives, and, that they are able to exist only because they do not set up an advertising bud- get, identical and proportionate to that of the major cooperative „ Such critician, of course, cannot be indiscriminately applied to all independents.

The independent producer and marketer serves a very useful purpose in providing yardsticks and checks upon the larger cooperatives, in providing a performance by which the larger organization can measure its own. The existence of the independent allows for experimentation in merchandising methods. Again, no one organization, no matter how successful or how well operated, can satisfy all growers. Differences constantly arise, leading to withdrawals. The independent agencies stand ready to offer these growers a service that keeps thera in organ- ized marketing. Again, just as no one marketing agency can satisfy all growers, no one marketing agency can satisfy all potential customers. Sane customers are willing to buy f^om and do a job for an independent agency where they would not be willing to do the same job for some other marketer. In that wsy, the existence of the independent agencies pro- vides more outlets for cranberries than would be provided by a single agency. This is to the benefit of the entire industry. Again^ the competition of the independent agencies acts as a check to keep market- ing costs in any one organization from getting out of bounds <, Certainly^ the oomoetition of independent agencies acts as a stimulant and a prod to other marketing agencies to do a better job under the threat of losing custOTiers or losing members, if a better job is not doneo

There is no question of the sincerity of those who operate these private distributing agencies and those who sell through these agencies, for they are certainly convinced of the righteousness of their position.

The Cooperatives

In most cases the berries are delivered directly fi°om the bog to "ttie packing houses of the cooperatives. This relieves the growers of any further responsibility in the handling of the fruit. When a lot is screened, if it is to be consigned to the fresh fruit market, it is packed and delivered to the trucks or cars which will take the berries to their destination. This service is based upon actual costs of handling the berries for the grower.

Today, the preparation;, standardization and grading to rigid specifications and the marketing of the fresh and processed fniit are pidmary functions of the cooperatives. The industry came into the 19^1 season with no carry-over, no apparent surpluses and a strong consumer demand.

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To reach this pointy however, the cranberry grower had to take positive action in order that the marketing system he had de- veloped and supported for these many years did not bog down.

This action took shape in an overall organization, the Cranberry Growers' Council, to coordinate the work of the cranberry cooperatives. The main task for the Council was to bring order into the cranberry marketing „

Cooperatives have been important in marketing cranberries for many years. The American Cranberry Exchange, with its central office located in New Bedford, Massachusetts, sells over $0^ of the fresh cranberries, and was the first cranberry cooperative. It is a federated cooperative selling agency for the local cooperatives in each state, and sells under the Eatmore Brand, The National Cranberry Association, East Hanson, Massachusetts, a centralized cooperative pro- cessor, has grown to be the largest processor of cranberries. It oper- ates canning plants in all producing areas, and sells under the Ocean Spray Brand, Both of these organizations have conducted effective con- sumer advertising and merchandising for years.

In no small measure, the continuing aggressive advertising and sales program of these two cooperatives has been responsible for the increased demand for both fresh and processed cranberries. The associations have helped extend the marketing season from the tradi- tional holiday season to a year-round business. In 19li9-1950, for example, fresh cranberries were sold from September through May,^-'- Processed cranberries were available to the consimer in every month. Many food stores have featured canned cranberries during the spring and summer months in connection with the chicken and cranberry adver- tising program of the National Cranberry Association,

During the period immediately following World War II, the cranberry growers faced serious problems in spite of the strong organi- sation within the industry. Production was increased from an average of 715,000 barrels in the 1939-l9ii8 period to 980,300 barrels in the 19^0-19^1 season, an all-time record. The production for the 19^1- 19^2 season being 932,500 barrels.

During the war there was a scarcity of cranberries. The fresh fruit lost much of its appeal to the housewife because she could not purchase the large quantities of scarce, rationed sugar required. Thus, many potential customers were lost to the market. The price of cranberries rose because of short crops and bidding among marketing agencies to get the available sunplies. The apparent boom in processed cranberries then brought in many independent canners, and record packs of cranberries were turned out.

By I9U8, it becane apparent that canned cranberries could not be sold in the quantities packed and under the many unknown and unad- vertised brands that had spring up. These supplies backed up in the

31

Capel, George Lo, "Opinions of Buyers on the Marketing Program of

Cranberry Cooperatives," Farm Credit Administration, United States De- partment of Agriculture, Miscellaneous Report No, l^li, Po 16,

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channels of distribution and the prices fell to disasterous levels, A surplus of berries for canning increased to nearly 500,000 barrels. As this surplus grew, it acted as a drug on both the fresh and processed markets. The burden fell on those rrith fresh crops to sell unusually large quantities, HerCp the industry came into comt)etition with itself.

The cranberry is a food item which retailers often use as a "sales leader." This is known by the figures indicating that the over- whelming majority of it is sold during the fresh fruit season. These sales indicate that the canned product is good enough for a very large oercentage of the population, Thus^, a profitable price cannot be com- manded for the fresh fruit in competition with a low priced can, Fur- thermorej when the price of the can is low and the trade realizes that it can get neither price nor volume from firesh fruit sales, they are in= clined not to handle cranberries in any form. The advent of the cheap can proved to be anoWier "millstone" for the industry.

By using a cheap can to push sales of the canned product during the fresh fruit season, both the market and the consumer are diverted away from the fresh fruit. The \init sales are then made in terms of the canned product instead of the cellophane consumer package of the fresh fruit. When a oackage of fresh fruit is soldj, one pound of cranberries is sold. The processed can contains but one=third of a pound of cranberries, the rest being sugar and water. It then appears that the industry has been atteraot- ing to prcxnote one-third pound sales at the expense of one-=pound sales when there are not enough potential sales units to absorb this dilution. The adultering of the crop on a 3 to 1 ratio only makes the "millstone" more burdensome for the industry to carry <>

To solve this paradoxical situation the growers again turned to their cooperatives. In analyzing the situation, it was seen that the need was for orderly marketing of the cranberries and to build back the lost demand. Only by close cooperation between the two cooperatives could these ends be attained. Instead of a hit or miss method of determining the anount of berries sold fresh or processed, the situation called for orderly distri- bution to all channels of marketing. This required a system whereby the growers' representatives would decide what part of the crop could be sold fresh and how much wovild be processed.

Out of this need grew the formation of the Cranberry Growers' Council^ an organization of grower-members of the two cooperatives and other growers. These growers charged the Council with determining how much of the crop to sell fresh and how much to process and with approving advertising budgets. The American Cranberry Exchange was made responsible for marketing the fresh fruit and the National Cranberry Association was made responsible for handling the berries to be processed and for conducting their advertising and merchandising program. In 19^0, the first decision was to market $0 percent fresh, 30 percent canned, and the remaining 20 percent to be used as the Council determined during the season. The 1900 crop was of record size. It was determined that the market could not take the large crop and the best solution was to divert 10 percent from the mar- ket. The Council allocated, for the current season, a division of I4.0 percent to each channel with 20 percent to be divided later.

The two-year operational experiment of the Council has produced some encouraging results. The large carry-over has been eliminated. Sales of the fresh and processed fruit have increased, while much of this increase has been due to increased merchandising activity of the cooperatives and

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a relatively low price level for cranberries, the Council can also take its share of the credit. It has justified its reason for existence hy restoring order and confidence to cranberry marketing, by assuring the trade that most cranberry growers are working together to solve their problems. The division of the croo between fresh and processed is no longer on a hit or miss basis. Continued research is needed into all phases of cranberry bijying habits and in the manner cranberries and cran- berry products are used before the Council's work can be put on a near- scientific basis.

Another controversial problem is that growers and distributors not in the Council can direct their actions to take advantage of the policies of the Council, For instance, if the Council decides that fewer cranberries should be sold in any one marketing period, it is possible for those outside to ship more fresh fruit than they might have otherwise done, thus nullifying the benefits that might have been derived from the action of the Council, The outsiders for the most part are for everything the Cotincil is trying to accomplish, they reap the rewards, but are reluc- tant to share their part of the burden.

Along with the efforts of the Council, the cooperatives have in- creased sales activity. The National Cranberry Association has increased sales of the canned product during the late winter, spring and sumner months. This has been done as part of an overall program to promote the use of processed crsinberries with chicken and other meats. The American Cranberry Exchange continues to widely advertise, making use of tie-ins with nationally known products, such as General Kills "Betty Crocker Gingerbread Mix," Hormel's "Spam" and others.

Cranberry growers are alert to the continued need for improve- ments in the marketing system. They recently organized a Cranberry Mutual, a cooperative venture aimed at promoting fresh cranberries. Thus, the cranberry grower is becoming increasingly aware of the necessity of co- operative effort in marketing his oroduct, if he is to reap normal profits from his labor. Cooperative effort in disposing of his crop appears as the only practical way for the solution of this problan. It appears that they must adhere to the cooperative plan through not only the years of large crops, but likewise in those years when the crop is short in supply. This is quite necessary if he is to remain in the cranberry-growing business.

Some high placed members in the cranberry industry believe that by combining existing cooperatives and fonning a national pool will solve their problems of disposing of all crops. Care here is necessary, because by such an amalgamation they could easily run afoul of the Federal law in regard to monopolies, especially so, if they handled fruit of non-members.

Others have espoused that by "orderly marketing" the National Cranberry Association regulate shipments during the suraner months of the canned product, in order that dealer stocks will be at a very low point, when the coming fall shipments of fresh fruit reach the market. They con- tend, if the canned fruit is not available, gi'eater attention will be given by the retailer to push fresh fruit sales, at prices which will be more satisfactory to the industry. They likewise contend that a better price would normally follow for the canned product. They believe that sales of the canned product should be pushed to the extreme during the late winter and spring months to sell that part of the pack which was held off the market. Attempts to juggle the law of supply and demand are

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hazardous at best, and such efforts would be reason and evidence for Federal prosecution under Monopolistic Practiceso

The operations of a cooperative do not result in profits or losses in the same sense that these terms are applied to a commercial enterprise. Their efficiency is measured by the amount of money made available to the members for the products they have sold and, by com- parison of such amounts received with the prices paid by other outlets available to the grower » These outlets are the independent canner and various independent sales agencies functioning in the fresh fruit fields.

The American Cranberry Exchange^ the principal fresh fruit marketing organization, remits to the shipper the proceeds of the sales after deducting the cost of selling the fruit » The fo^Oob„ returns to the Exchange in 195iO were $10o62 oer barrel „ The expense of selling the fruit anounted to 13.35^ of the f„o„b„ price received by the Ex- change, The cost of the Advertising and Marketing Program of the Ex= change amotinted to fifty-five cents per barrel, or 5ol275^ of the total selling expense and the Operational Expense of the I^chaige5, which in- cluded brokerage fees of eighty-five cents per barrel, accotinted for the balance of this expensej or ^„223% of the total selling expense. The net proceeds remitted to the State Shipping Unit were $9o20 per barrel, or 86.65$ of the feOob, received by the Exchange.

The National Cranberry Association, the principal processing cooperative, distributes to its manbers for the berries turned into the company the proceeds frorr. the sale of the processed products, less the manufacturing, selling and administrative costs of processing„ These amounts then disbursed as dividends or set aside for special pur- poses in properly authorized and reasonable reserves.

Deductions made from the sale of the processed product in- clude not only the expenses incident to processing as such, but also the various other expenses incijirred by this Cooperative. These in- clude expenses for such activities as growers' service (including therein educational and advisory services, and the administration of central purchasing and financing plans), together with the advertising, administrative and other costs related to the many activities of this cooperative, which are sin important part in the long-term development of the cranberry industry as a 1*1 ole.

Any comparison of the afnounts paid to growers of the orocess- Ing cooperative with the amount available from the independent canners will be erroneous, unless consideration is also given for the mar^r constructive efforts made by the cooperatives. The cooperative contri- butions made in the interest of the industry over a period of years have no counterpart by the commercial canners or the independent mar- keting agencies in degree or kind.

For the fiscal year ending ITay 31, 1951, the National Cran- berry Association reported that the Net Total Composite Cost per case was $2,1793; (one barrel of cranberries makes 11,0? cases of the pro- cessed product) giving a Net Return per case of $.7983, and a net re- turn per barrel of $80836 to the manbers.

=iiO=

Cost Against Selling Price

The average annual crop of cranberries for the years 19ii5- 19i;9 was 822,100 barrels for -which the cranberry grower received an average price of $17,81; per barrel. The highest price received diiring that period was in 19ii6, when the retiirn to the grower was $31o90 on a crop of 856^100 barrels. The lowest return in the same period was in the 19^9 season with a harvest^of SUOjiiOO barrels j the return to the grower was $9 .,23 per barrel,-'' The average Thrice received by the grower for the 19^0 crop of 980^,300 barirels^ of which 308^929 barrels were sold as fresh fruit by the American Cranberry Exchange, and 271,688 barrels were sold as fresh fruit by the independents^ 3l40jOOO barrels were processed, the balance of the crop did not reach the mar- ket, was $10.62 per barrel, 33 A return of $12.00 a barrel is indicated for the 19^1 cropo^u

The average grower has made little or no attempt to learn his actual cost figures. Interviews with ororainent people in the indus- try lead the writer to conclude that a segment of the industry is not anxious to divulge their actual growing costs^ lest they fall into the hands of Federal and State authorities. The general round figure of production cost obtained varied from ten to twelve dollars a barrel for the period 19li5-1950, These figures are at variance with Dr, Cross- mon's findings, (See Appendix A^ Table 1,) They likewise estimated that production costs would be up an additional $1.50 per barrel for the 1951-1952 crop.

The estimated production cost figures compared with the annual returns per barrel in the years 19U9-1950 indicate that the growersj, as a whole, lost money. However^ the writer has observed that many of the Massachusetts growers made money during those years, although not in the amounts which they received from the high price crop year of 19li6.

The average cranberry grower appears prone to reckon his profits on the years in which he enjoyed his best return, and those years in which the returns were less, he lost money. In several in- stances, the writer has observed that these growers have continually improved their bogs after the "loss years," by building additional flowage facilitiesj, re-sanding and buying mechanical harvesting equip- ment. It is the knowledge of the writer, that these growers did not put new money into the bog improvements or equipment purchases, but used their non-claimed profits for these p\irposes„ Clearly, then, at least for these grower s^ the estimated production costs appear hi^, for these bogs of about eighty acres are not the most effic- iently managed or most productive bogs in the Cape Cod area,

^^United States Department of Agriculture^ Bureau of Agricultural Economics, Agricultural StatistiieSg 1950.o Table 2^65, p. 205.

33American Cranberry Exchange for Crop Season, 1950, pps. U, 5s and 12, 3^Cranberry News, September 195li. Vol. XII, No. 9s> P» 1

Price Fixing

The opening price for each crop is set by the American Cran- berry Exchange and is announced about the second week in Sept ember » The figure set is the highest which, in the findings of the economists of the Exchange in their market surveys and in the judgment of the Exchange, the martet will cay for the quantity of fruit ifrtiich is ex- pected to be offered for sale.

The factors #iich made for geogrpahic concentration and restricted entry were also responsible for the concentration of bog holdings into fewer handSo It is clear that these conditions provide a favorable setting for marketing control and other monopolistic orac- ticeSo-^5 On the other hand, it must, in fairness, be admitted that highly variable yields, the perishability of the oroduct, and the lack of complementary sources of income combined to make cranberry production one of the most hazardous of agricultural enterprises. It is, therefore^, not surprising that producers at an early stage awoke to the possibility of protecting their relatively high investment by means of "Organized Marketing o"

The three Sales Companies united in 1907 to form the National Fruit Exchange, After several years of price cutting with Growers Cranberry Company, a consolidation with the latter was effected in 1911, under the name of the American Cranberry Exchange, In 1919, to conform with the Clayton Act, (which exempts from the Sherman Anti-Trust Act all agricultural cooperatives of a non-stock type) this organisation was put on a non-stock, non-profit cooperative basis.

The three Sales Companies, like the American Cranberry Ex- change« are subject to all privileges granted to cooperatives xmder the Caoper-Vol stead Act of 1922„ (See Aopendix A. Exhibit IIIo) Membership certificates in the three state organizations are held by a total of kSQ individuals and corporate growers. Each state company acts as an intermediary between the grower and the American Cranberry Exchange,

Since it began, the American Cranberry Exchange has never handled less than $0% of the total of fresh cranberries marketed in the United States, After fluctuating during the first two decades of its activity, this proportion gradually increased in the third decade from $9% to 725? in 19li2 and in 19$0 decreased to 5Wc^° During this period the American Cranberry Exchange spent as high as five and one-third cents of every dollar received for cranberries,

"■^ '^Compare the following candid statement by the President of Cran- berry Canners, Incs "We are fortunate in that the area in which cran- berries can be grown is limited. This places a natural restriction on overproduction. It also confines growers to small areas where they can become acquainted with one another. The cranberry industry is probably outstanding for the friendly feeling and the lack of cc8tt= petition among growers. This has played a great part in further co- operation," Cranberry Canners, Inc., Reoort for the Fiscal Year end- ing May 31^ 19U3, p. 27.

-'"Boo a, Allen & Hamilton^ Report of Survey American Cranherrj Exchange j 19li5<i Exhibit XI, and American Cranberry Exchange Annual Report, March 31, 19^5 p. 0.

-1|2-

•which meant that during the 19^0 crop season, it cost the grower approximately fifty- four cents for every barrel of berries sold through the American Cranberry Exchange,

In 1930, the three leading processors, also producers of berries, decided to pool their facilities and foimed a new com- pany known as Cranberry Canners, InCe, (reorganized in 19li6 as the National Cranberry Association and added the selling of fresh fruit to their activities), with Mr. M« Lo Urann as its first president. Cranberry Canners, Jnc, in turn, entered into contracts with the three state sales companies providing that each deliver a minimum of ten percent of ttie cranberries grown by its members to Cranberry Canners, InCo In practice, appreciably more than ten percent of the berries are delivered each year for processing. In addition, a substantial quantity of cranberries is delivered to Cranberry Canners, Inc., from members not affiliated with the American Cran- berry Exchange. Members have purchased (through agreement or other- wise) quantities of cranberries from nonmembers.

About one-third of the voting stock of Cranberry Canners, Inc., is now owned by a member company, the United Cape Cod Cran- berry Company. The majority of the voting stock of the United Cape Cod Cranberry Company is owned or controlled by Mr. H. L, Urann. Approximately 13 % of the voting stock is held by another member company, the A. D„ Makepeace Co. 37 The three state cooperatives of growers and individual stocMiolders own the rest of the stock. From the time of its incorporation,, Cranberry Canners, Ihc,, has been eligible for the privileges given under the Capper-Volstead Act and the Farm Credit Act of 1933.

The two dominant cranberry marketing organizations, the American Cranberry Exchange and Cranberry Canners, Inc., are closely tied together in a system of interlocking directorates by virtue of which, in effect, they form a marketing monopoly controlling more than 75/6 of the total crop. 38

In October 19lil, the Antitrust Division of the Deparfanent of Justice instituted criminal proceedings against the Cranberry Canners, Inc., the American Cranberry Exchange, the United Cape Cod Canners Company, the A. D. Makepeace Ccnipany and thirteen individuals, charging them with having entered into and engaged "in an unlawful combination and conspiracy" in violation of Section 1 and Section 2 of the Sherman Anti-Trust Act of 1890„ As »a part of said unlawful combination and conspiracy," the charge further specifies the de- fendants "determine the quantity of cranberries to be manufactured

17

-^ 'These two companies^ owners of large bog holding in Massachusetts,

turned over to Cranberry Canners, Inc., in 19h2 over 22$ of the total production of the state, or more than one-half of the quantity pro- cessed in the United States in that year, some of which was purchased from small bog operators, iiach of these two large companies is a mem- ber of the American Cranberry Exchange and Cranberry Canners, Inc. This may serve to illustrate the extent of economic control which a few growers can exercise within selling organizations as in the industry as a whole,

3oHysonj, Charles D.j Sanderson, Fred. H., "Monopolistic Discrimina- tion in the Cranberry Industry," (Harvard) Quarterly Journal of Economics, Vol. 59, pp. 330-369, (19Uli-19ii5') ~ ~~"

-ii3-

and sold as cranberry products," agree upon , , „ „ the prices to be charged for cranberries and cranberry products," "restrict, limit and control the quantity of cranberries to be marketed and sold as fresh berries," "control and regulate the manufacture and sale of cranberry products^" and 'suppress and prevent competition between cranberry products and cranberries."

It is alleged, furthermore, that the defendants "compelled, persuaded and influenced growers, not members of the defendant American Cranberry Exchange or stockholders of the defendant Cranberry Canners, Inco, to sell cranberries at the prices fixed and determined as afore- said| purchased large quantities of cranberries from growers not mem- bers of the defendant Ameriican Cranberry Exchange, or stockholders of the defendant Cranberry Canners, Inc«,, for the purpose of preventing „ „ „ the sale of cranberries in competition with cranberries marketed by the defendant, American Cranberry Exchange, InCo," refused to sell cran- berries to independent canners and influenced and oersuaded growers, not members of the defendant, American Cranberry Exchange, InCo, or stockholders of the defendant Cranberry Canners, • Inc„, to refuse to sell cranberries to independent canners," and "purchased large quanti- ties of cranberries from growers, not members of the defendant Ameri= can Cranberry Exchange, InCg or stockholders of the defendant Cran- berry Canners, Inc„, for the purpose of preventing „ o « o the manu- facture of cranberry products by independent canners, "39

On November 2, 191^2, a plea of nolo contendere was entered for the corporate defendant So The case, therefore, did not go to trial, and full evidence appears only in the secret records of the grand jury proceeding „ Fines imposed by the government amounted to a total of $32,OOOo (See Appendix A - Exhibit I?)„

The lack of adequate control of the market has so far pre- vented the effective manipulation of the supply. The charges concern- ing attempts by the American Cranberry Exchange and the Cranberry Can- ners, Inc., to extend their control to non-Hoembers are all the more serious for this reasono A very high degree of control, probably more thai 90^s is required for effective price discrimination in this market .^^ The general welfare requires that the government step in, either to pre- vent this degree of control from being attained, or if this is impossible, to prevent it from being exploited for the benefit of a feWo However, the failure of the two marketing organizations to increase returns above the competitive levels is, however, readily explained by the lack of adequate control o'visr the supplyo There can be little doubt that the two marketing organisations "conspired, " that they acted in combinationj but they seem to have gained little by so doing. Even if they had com- plete control of the market and had allocated their sales to maximize returns to members, the cost to the consumer would have been relatively small, particularly if it is compared with the gains available to pro- ducers 1*10, with or without overt acts, managed to restrict production.

^%nited States vs. Cranberry Canners, Incorporated, et aloS Indict- ment No, 100-389 (Criminal), October 1911 »

^<^augh, F, v., Burtis, E. L., and Wolf, Ao F., "The Controlled Dis- tribution of a Crop Among Independent IfarkEts,*' (Harvard) Quarterly Journal of Economics, (November 1936), Vol, $1^ pp„ 1-90 „

During the course of the litigation^ the changes objection^ able to the government were made and the then defendants have since followed ways and means of conduct tog business as originally envisaged Tinder the Capper-Vol stead Act, Again, of recent yearSj these two mar- keting agencies have not controlled as much of the crop as in previous years. With the advent of strong consimer demand, stabilization in the industry, short crops^ and increased returns, they could revert to "their former practices.

The directorate of the Cranberry Growers' Council^ Inc., is composed of directors of the American Cranberry Exchange and the National Cranberry Association. Again, the two organizations are being investigated for this interlocking relationship. From a stand- point of those in the management of the cooperatives, this appears to be a battle between the lawyers, in view of the fact that their attorneys have thoroughly agreed that the procedure followed in the Cranberry Growers' Council is not only legal, but practical as well, and a desirable approach from an industry standpoint. If the court should indicate this procediire is not correct, then the cooperatives will be required to discontinue the activities of the Cranberry Growers' Council, at least in its present form.

CHAPTER VI

FINANCING THE CRANBERRY CROP

The early history of cranberry growing in the United States and particularly in the Cape Cod region of Massachusetts was, for the most part J pioneered by those natives, who were fortunate enough to own suitable bog landsj, upon which th^ constructed the first bogSo Their investmesit was principally their own laboro The rapid success of these early bog ventures led to larger projectsj which required more labor and capital than the individual had at his disposalo The first solution to this problem was by the way of a joint-venture part- nership, where the bog was constructed "on shares" j an informal arrange- mait by which a few friends or relatives each contributed that which he was capable of giving^ namely^ land, laborj or fimdso Each shared then in the ownership of the bog to the extent of his contributiono

The participants in these joint ventures usually held a split-deed of ownership of the bog, the participants having an un- divided interest^ according to his contribution in the real estatCo In many cases, however, there was not even a formal agreement for dividing the real estate or the ensuing cropso In some instances, the verbal arrangements made by the original parties are still being used by the descendants of the original owners. Fortunately, there are but a few of these cases remaining today, for if financing was sought, some difficulties would certainly arise in obtaining a clear title, especially so, when only very meager and often inaccurate descriptions of the property lines appear in the deeds of ownerAip,

In a large measure, the early growers who planned to extend their holdings sought financial help from individual lenders » Here was the beginning of large concentration of holdings by the grower- lenderSo The terms of their loans were such that they were largely favorable to the lender, a breach of contract meant speedily fore- closure and a new bog for the lendero It is not the purpose of this paper to trace the origin of the larger bog holdings in Massachusetts! suffice it to say, that several of the large bog holders today are also in the cranberry finance business.

The building of a bog is a three- to four-year proposition before a crop can be raised where the return can normally be expected to be over the costs of maintenance o In the years past, it was con- sidered that a bearing bog would repay its costs of building and maintenance within a ten-year periodo Today, with taxes eating more heavily into earnings, increased maintenance costs and living expenses, it is rather doubtful that full mortization could be accomplished

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•within the old ten-year period. Financing for construction purposes is then in the nature of capital lending and not within the functions of commercial banking. Some financing for construction purposes has been done "by savings banks where the mortgage was written to cover not only the bog and the bog facilities, but also the other real estate of the borrower.

For many years the commercial banks were very reluctant to make loans on established bogs, due in part, to the rather hazardous crop prospects fran year to year and to the lack of an organized market for the crops when harvested. Today, with the increased use of scientific knowledge in cranberry culture and with the means of controlling, in a large measure, the natural risks that made the annual crop uncertain, the commercial bank is more willing to consider the Bog Loan Application upon its own merits and not reject it per se. An additional reason for this considered attention by the bank is the more orderly marketing program for the industry.

Methods of Financing the Grower

From a survey of the lending policies of the banks situated in the cranberry-growing regions of this country, it was found that all extended short-term credit with satisfactory resiilts. All made crop production loans to cranberry growers generally supported by the financial responsibility of the borrower, with repayment predicated upon estimated income from the operations, and all required full liquidation each season. In a very few instances the banks added further support to tiiese loans by taking a crop mortgage to assure themselves of receiving all returns from the cranberry sales and, if sold through a cooperative pool, they request an assignment and an acknowledgement of the assignment from the cooperative. However, the banks in all the growing regions were generally unanimous in reporting that the responsibility of their customers has been such that this procedure (securing the loan by a crop assignment) has not been neces- sary. The notes under which these short-tenn lines are usually drawn have a mat\irity to coincide with the date funds will be available from crop sales to effect liquidation.

An acre of producing cranberry bog represents quite an in- vestment and is generally regarded as the most expensive per acre land used in ar^ agricultural endeavor. It has been noted elsewhere in this paper that the cash outlay before the initial harvest was from $2^000 to $3,000 r>er acre, with costs being greater in the western regions irfiere they use sprinkler systems as a protection against heat and frosto In the years immediately following World War II the cran- berry bog was selling from $3,500 to $li,000 an acre. Due to the de- pressed price of cranberries in 19i;8 through 1950 it has been difficult to aporaise the value of bog property for loan purposes. The 1951 season was not impeded with a depressing "carry-over," the markets were firm both for the fresh fruit and the processed product, with an anticipated return for this year's crop reaching $18.00 per barrel, a firmer and more realistic value can be placed on the Droducing cran- berry bogo The National Cranberry Association can present bona fide sales showing prices per acre in 1951 from $2,000 to $2,500. These sales apparently were made in the Massachusetts growing regionj, for reoorts from the other growing regions are silent as to recent bog sales.

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Today, the banks in the cranberry growing regions are more willing to review applications for the piirchase of existing bogs. It is notes that the banks contacted, which are the principal banking connections for the growers in those regions, that they have never experienced a loss in any loan made to a cranberry grower „ One of the Cape Cod banks contacted, reported that they have never been forced to foreclose on any bog loan, although they did state, that they "waited" for a few. This bank handles the bulk of the cranberry financ- ing that is done by banks in the Massachusetts region.

The Wood County National Bank of Wisconsin Rapids, Wisconsin, which handles over ninety percent of the cranberry business in Wisconsin likewise reports satisfactory performance „ The National Bank of Commerce of Seattle, Grays Harbor Branch, Aberdeen, Washington, and the Ilwaco Branch, Ilwaco, Washington, report their experience as reasonably satis= factory, but that they are now operating on a much more conservative basis after experiencing some very difficult workouts o These workouts can be in part ascribed to a more generous appraisal of $3siOOO an acre, whereas it was the policy in the East, even when the cranberry bogs were selling from $3^500 to $1^,000 an acre, never to exceed an appraisal of $1,800 to $2,000 an acre for bogs of top quality,, Again, in the East, the banks expect the borrower to put in of his OTm funds as much or more than the bank itself is willing to risk„ The owner then having a greater financial interest in the bog will be more inclined to pro- tect his investment through good seasons and poor ones, by not neglecting to car for it properly. Also, in the East they have a hard and fast rule of extending credit for bog purchases only to experienced growers.

Apparently, in the state of Washington, the banks were not as selective in their credit risks to bog owners, nor were they as conservative in their appraisals as were the eastern bankso The banks holding mortgages made on the basis of an unrealistic appraisal^ found when the going became hard and the growers' income was not sufficient to repay the loan as agreed, the bank, in fact, had bought themselves a cranberry bog. The difficulty, in most cases, was that the owner became discoxoraged over the price structure and, when he found that he was unable to make a living from the property^ he was forced to seek work elsewhere. In maiy cases, the bog would not receive the care re= quired and, in a matter of a year or two, it would revert back to weeds. Sometimes it is not feasible to attempt to bring back these bogs after only a few years of abuse. The personal factor which enters into this type of loan varies much and that is something which is very difficult to predict at the time the loan is granted.

Today, their policy is to grant loans only to experienced growers who have demonstrated their ability and willingness to keep their bogs in proper shape. Furthermore, they also insist that a sprinkler system \>e installed on the bog property and also that there be a home and a warehouse on the property and that these buildings be in good repair and fairly modem. They now hold their appraisals to about $1,000 an acre» In the transition from the very liberal aporaisals of a few years ago to the ultra-conservative and unrealistic appraisals of today, it readily becomes anparent that the growers in that region will be forced to seek their credit needs firora governmental agencies or the cooperatives.

The First National Bank of Portland, Oregon, Coquille Branch, reports that th^ are not presently financing the cranberry grower

through long-term real estate loans butj if the opportunity offered itselfj any such loan would be predicated upon the financial responsi- bility of the borrower^ income from the bog^ analysis^ of recent sales of this type of property in the area and the nature of the improvanents .

In discussions and -writings with leading bankers and spokes- men for the industry, the conclusion could not be escaped that the co- operatives were actively taking care of the financing needs of the in- dustry and that their policies were such as to preclude successful bank competition. With one of the cooperatives discontinuing financial ser- vices to its memberSj, another restricting those servicesj, the growers are perfopced to look to their banks^ governmental agencies or private sources for their credit needs o Nowj, that the industry apparently is on the threshold of a brighter future^ it becomes readily apparent that if the industry is to thrive and be prosperous in the future, credit must ba available and if such credit is to be soundly based, it must flow frcxn bankso

In no producing area is the entire crop sold locally, but in every region the far greater part of the crop is exported to other sections of the countryo Certaialyj, this inflow of money into the growing regions for their crops has an important bearing on its economy.

It would appear that an industry producing annually a crop which has seldom, withia the last twenty years had a farm value of less than $6,0005, 000,, ^^ ^ mifficiently valuable segment of the economy to merit the active support of those whose business is the formulation and administration of sound lending policies. The banks have not ap- peared hesitant to extend deserring credit to businesses in these regions, which depend indirectly upon the cranberry industry for their well-being. If one is to accent the principle that the banks have an obligation to supply the areas in which they serve with all justifiable and worthirtiile credit requirement s^ serious thought and stu<fy of the cranberry industry and its potential new business offerings, would appear as in order for the bankers in the five cranberry-growing areas. Unless this is don©, they will be paving the w^ for greater government encroachment into their lending spheres.

From the study the writer has made of the cranberry industry, it has been determined that there is no uniform method of appraisal of bog property used by the bankers^, governmental agencies or individual lenders. The principles of agricultural lending ciirrently advocated by the Merican Bankers Association can readily be applied as a basis for a sound policy. Proper appraisal of the man and of the land, methods of operation and income-producing ability of the enterprise, considered in the light of probable eeoncmic conditions during the life of the loan, are factors for consideration which apply equally as well to the cranberry grower as to the citrus or potato grower. Recognition of the fact that the farmer's living expenses are the first claim on agricultural income,, the necessity for arranging terms to fit the particular needs of the borrower^ adjustment of maturities to coin- cide with the sale of crops^, consideration of loans with a view to their effect on the borrower, the community and the banks should all be features of a good lending program for the sranberry grower. Of course, canplete loan files are a necessity and, probably most important of all, there must be someone in the bank to carry out the program, who is intimately familiar with the cranberry industry and its economic import to the area, and who sincerely believes in its future.

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Much of the trouble that befell the cranberry grower of recent years has been due in a large measure to the oveir-granting of credit based upon unrealistic appraisals of bog property « The study the -writer has made of this phase of the industry leads the writer to conclude that the appraisals made in the past certainly did not conform to any conservative pattern^ There is recited below a method of appraisal used successfully over the years by a commer- cial bank and two independent growers and financiers, (Names upon request,) This is presented in the spirit that it may be of help to others engaged in financing the cranberry grower. Cranberry cul- ture, as has been noted before, is a very specialized form of agricul- ture and, as such, requires a more comprehensive method of appraisals than is generally necessary for other agricultural pursuits.

Bog Appraisal?

Preliminary review of the completed loan application by the Loaning Officer, who then passes it along to the Real Estate CJommittee for further consideration,

1. The applicants

a. Experience - 20^

b. Character - loiS

c. Capacity - I05S

d. Capital - 1^ |^

2. The Bog Property t gO^

The Real Estate Committee views and examines the bog property. At least one of the members of this committee being an experienced cran- berry grower. The maximum percentage values alloted to the following bog properties are:

Water Supply - ^%

Quantity - Sufficient for all season purposes or, is it

ample for early season requirements?

Quality - Alkaline or Acid? (Litmus Paper test)

Does the owner have uncontested rights to the water supply?

Sand - 5'^ Quality Quantity Availability Date of last sanding?

Bog Condition - 10^ Depth of peat, pH content of humus Minimum pH requirement of I;, Field test pH, Shape of Bog, - Is it level? Is it well adapted for the use of mechanical harvesting equipment?

Age, May reflect on bog condition if there is evidence of neglect. Type of bottom - (Hard bottom requires fertilizer,)

Location - $% Does the location permit easy gravity flooding and draining? Does the location require water pvmping facilities? If sOp ■ can the water be handled economically?

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Plantings - $%

Standard of mixed varieties. Condition of the vines. Evidence of disease. Evidence of insect damage.

Production - 20^

Record required of the last 5 to 10 years' production. (If this record is not available from the grower and he has been selling the berries through a cooperative, the required in- formation can be obtained from that source.)

The level of bog values being tied to the average annual per acre yields. There are costs common to all bog operations, regardless of the per acre yields but there is a diminishing return to the grtjwer as production goes doim.

The bog being classified according to its average annual per acre yields- Over Over Over Over 60 bbls. $0 bbls. UO bbls. 30 bbls.

2056 \% lOjg %

If the average annual production record of an established bog is under 30 barrels Der acre, it is considered as not having a sufficient earning potential to warrant further consideration.

If the present production is below average, is it the fault of the management, the fault of the bog, or a combination of both?

If the property being appraised is comparatively new and without a production record, comparisons are made with sinilar proper- ties having approximately similar conditions, to estimate it's probable per acre yields. Bog production classification is then made on the basis of the estimate yield.

Size of Bog; A six to an eight-acre bog can be properly cared for by the owner with a minimum of hired help. Larger acreage requiring ad- ditional help.

Bog facilities - kind, condition, suitability.

The foregoing method of bog appraisal is a more realistic approach in determining the fair value of cranberry bog property for mortgage loan p\irposes. With cranberry bog property having a value of $2,^00 to $3,000 an acre, the maximum amount the bank will advance is 50^ Of the per acre value, and that amount is only advanced when the Real Estate Canmittee gives a 100^ rating to the bog property. Other advances being based proportionately upon the percentage rating determined for the bog.

The basic appraisal would, of course, be necessary if the applicant were an individual or a company engaged in cranberry growing. Of course, if the applicant were a company, incorporated or not, the

-procedure before the granting of the loan wjuld not be quite as simple as that of a loan to an individual grower. The bank would request. In the case of a loan to a company's certain other information and documents defining the conditions of the loan which would be incorporated into the Loan Agreement.

The bank would normally ask as security for a mortgage loan to a company, a chattel mortgage covering all equipment used in the operations of the bog, together with a real estate mortgage covering the bog property, land, water rights and real estate incidental thereto. Possibly, they would ask for a pledge of the stock of the company and the personal endorsements of the principals, if the statements of the concern warranted such precautionc The Loan Agreement of the company would contain covenants which would prohibit or limit the company in doing any of the following things while the mortgage note from the com- pany to the bank remains unpaid, except with the written consent of the latter s

ao Sell or mortgage any of its physical assets j bo Borrow any money after the date of said note; c. Issue or agree to sell a^y stock of any class; do Declare or pay any dividends,,

e. Make any change in or amend its Charter or

Articles of Organization or vote to dissolve;

f , Make any lease of its personal or real prop-

erty which cannot be terminated by the bank,

or its successors or assigns^ go Pay any salaries or compensation to its of-

f icersp executives or officials of the company

beyond the rate now being paid^ with defined

limits as to the maximum salaries allowable; ho Incur any obligation or make any contracts

which are not in the current and ordinary

business of operating said ccsnpanyc

Additional requirements would bej certificate of cLerk of the company that the loan was properly authorized at a regular or special meeting of the stockholders of the company, and duly re- corded in the minutes of the companyj that the by=laws contain no provisions inconsistent with the above vote 5 that the president was du]yelected; that the certificate of the vote has not been altered or amended and is still in full force and effect c In all instances, the bank would insist upon a clear title to all proper1iies„

Methods of Financing the Private Distributing Agencies

The private distributing agencies not only market the berries which they themselves grow but also the berries bought from other growers who are not members of a marketing cooperativeo These agencies are, for the most parts financially capable of taking care of their own seasonal needs and seldom require outside assistance. Ample bank credit is available to thiese agencies on an unsecured basis.

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Methods of Financing the Fruit and Produce Wholesaler

The cooperatives andj as far as can be ascertained, the in- dependent sales agencies have been very selective in their choice of distributing channels in the marketing of the cranberry crop. The crop moves from the fresh and processed sales agencies through the basic trade channels, which finally get the cranberries to the ulti- mate consumer's tablCo The five main steps in this latter distribution process take the fruit through (1) the brokers, (2) primary receivers of fresh foods, (3) wholesalers and jobbers, (U) the chain stores, or (5) the various retailers of fresh and canned foods.

The cranberry sales by these outlets represent but a very small percentage of their annual business volume. The financing these outlets need is usually available through their regular bank-. Ing channels. A study of the financial reports of the fresh and the processed sales agencies over the last four years reveals gross sales of over $60,000,000 with a net charge-off for the entire four years of less than $8, 000. 00 » This is slightly more than l/lOO of 1% of total sales, which is very nominal, indicating careful credit exten- sions by these agencies and a splendid collection policy and finan- cial responsibility of the customers.

Methods of Financing the Industrial Users

The by-product end of the cranberry-processing business has not yet been developed to a point where the sales of these products are a factor of any great consequence in their annual sales. The chief deterent to the development of this line of business is the cost factor in recovering useful canmercial by-products. Again, it is questionable if -these products can, in the immediate future, be pro- duced in volume at a cost comparable to what similar products are obtainable from other sources. Also, it is questionable that from the volume of these products obtainable each year they could be sold at a profit, which would justify the expense of additional plant facili- ties required. There is under discussion plans for a Pilot Plant develop- ment of these products. Presently, no special financing is being con- sidered.

Methods of Financing the Cooperatives

It is not within the intent of this paper to delve into the problems of the financial difficulties which the cooperatives largely brought upon themselves by venturing into fields which were outside of their normal functionsj, and which they were not equipped to properly handle. This paper attempts to portray the picture of the cooperative as of today and as they are likely to look in the Immediate future.

Jtaple credit for the sales companies in their normal opera- tions has, in the past, been available from the banking system, and the experience has been satisfactory. Their seasonal needs being be- yond the legal limits of the Country Banks, they obtained this credit from the City Banks.

The large processing cooperative, the National Cranberry Association, canners of the "Ocean Spray" brand have for many years

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used the facilities of the Springfield Bank for Cooperatives for their credit needs. It is interesting to note that Marcus Lo Urann, the President of the National Cranberry Association has been one of the seven directors of the Springfield Bank for Cooperatives since shortly- after the beginning of this relationship.

The National Cranberry Association has at present with the Springfield Bank for Cooperatives a Working Capital Loan, -which is a seasonal self -liquidating loan and is based more upon the financial condition and the operating record than upon the security available o As of Novonber 30, 1951, these borrowings were in the amount of $3,600,OOCplwhich will be paid out before the 19^2 crop comes into the market. These seasonal loans have been paid out yearly with the exceDtion of the three years, 19U7, 19U8 and 19li9s, when there was a heavy carry-over.

In addition to the above loan, they also have a Facility Loan with -the Soringfield Bank for Cooperatives, This loan is in the form of a mortgage covering the real estate and fixed equipment of the canning plants located in the five chief producing areas. As of Novem- ber 30, 1951, the balance of this loan was $2,IiOO,000^ and present in= dications are that the loan will be paid out before its maturity in 1935.

The Springfield Bank for Cooperatives reports satisfactory performances in the above two loans and maintains that they are better equipped to service the needs of this cooperative than are the commer- cial banks, because of their special knowledge and experienced person- nel engaged in servicing this liranch of agriculture. Furthermore, they claim a more sympathetic attitude toward agricultural pursuits, an atti- tude not generally shared by commercial banks,

Ih addition to the above, the Cranberry Credit Corporations, a wholly owned subsidiary of the National Cranberry Association was formed in August, 19^2, with a capital of $100,000, which took over the bog loans. This capital was substantially increased later, as demands for credit increased, and the corporation expanded its activi=> ties to other purchasing areas. Loans were made to members primarily against bog mortgages, on a three-year basis, and some seasonal crop loans were made on an unsecured form. This paper is discounted with the Springfield Intermediate Credit Bank. Satisfactory perfonnance is now claimed, although many of these loans are definitely work-out pro- positions with higher taxes, increased cost of bog supplies, hi^ labor costs, and the additional cost of preparing the berries for market does not permit rapid amortization of these mortgages.

In the present form this is not a proper commercial bank credit. Properly operated, this type of loaning could be a joint venture between the City Banks and the Coimtry Banks. Salvage value of these loans is little unless there is an active market for the bogs. Today, the Cran- berry Credit Corporation is not overly active in soliciting new business, preferring to have its members seek credit from other sources.

^■^National Cranberry Association, Financial Report, November 30, 195lc Idem.

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CHAPTER VII

CREDIT EXPERIENCE

In most all forms of agriculture there is always the ever present problem of the struggle -with the natural elements, and the cranberry culture is no exception. Most agricult\iral products are a staple in the diet of man or beast and consequently command a ready market „ Cranberries, in the final analysis^ are still a liixury crops, possessing no properties in the diet of man that can- not be supplied by other fruitSo Cranberry culture is a very specialized form of agriculture that requires special knowledge and skills for its successful cultivation.

The banker, to make successful credit extensions to the grower and to those engaged in the marketing of the crop, must have more than a passing knowledge of this branch of agriculture. Hence, in financing the cranberry grower and the distributing agencies, we are dealing with a specialized form of agriciiltue, the amount of the end-product which can never be acciirately predicted much before the actual harvest o Again^ consideration must be given to the remote possibility that the food-buying habits of the public could change, and the demand for cranberries and cranberry products, would soften to a point where there would be diminishing returns to the grower.

Risks of the Industry

The chief risks of the industry are the weather elements. Probably no other branch of agriculttire has made so much progress in effectively controlling these elements as has the cranberry industry. The cranberry grower, by the use of water for flooding and sprinkling, can control frost, the ravages of some insects and the burning of the fruit by the hot sun„ Again, the cranberry grower, who has an adequate supply of water can irrigate his bogs during the season, if nonnal rain- fall is insufficient for that pvirpose.

A frost-warning system has been in operation for many years, first by the use of telephone when the danger of frost was imminent and later by the use of radio to give up-to-the-minute warnings and a more complete coverage. These warnings, in a large measure, now take much of the guesswork out of flooding for frost protection and accord- ingly save this expense for the grower o

Specialty faming such as cranberry culture requires the mastery of frosts. One of the most promising and revolutionary develop- ments In recent years is a new type of heater which protects from frost up to an acre of growing crops. In the next decade, it will undoubtedly

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become one of the most valuable tools for protecting the cranberry blossom and the growing fruit susceptible to frost. Basically, the principle of the new frost protection is an oil-burning lamp, which is placed on a platform or on a tall metal tripod in the growing area. The infra-red ray is the scientific basis of the new frost controller., The cost of operation *ould be much less than the cost of flooding the bogs, and there are no residual problems as in the case of flooding for frost control.

The control of insects and plant disease is a constant subject of research by the several State Agricultural Schools and by the United States Department of Agriculture. The newer insecticides and herbicides have been very effective in controlling pests and diseases of the plant.

The cranberry industry can control, in a large degree, the ravages of the natural elements upon their product. However, this can only be done at a price, and the greater the protection sought, the greater the cost. The extent of control of the elements that is made has a direct bearing upon the net receipts to the grower.

The large crops of the last three years cannot be explained be- cause of the new bogs coming into production for the first time. Some new acreage came into production in the Wisconsin region during these years, but this in itself did not account for the large crops. The answer appears to have been a combination of favorable weather and better agri- culture techniques. The results of the new growing techniques which were used previous to these years became evident in larger per acre yields during this period.

Probably^, the greatest risk now confronting the industry is the possibility of over-expansion of production facilities. Such in- creased production is not likely to come upon the industry in any one year. Several successive years with prices which produce profits for the growers would be an incentive to build new bogs. Both in Wisconsin and on the West Coast there is anple and suitable marsh land available for expansion. The high initial investment required to bring a bog into production will not be a deterrent if there are prospects of future profits.

Conversely, if there *ould be several successive years of short crops and the distributing agencies were not able to supply the demand, a possibility could occur Tiitiere the public would become accus- tomed to doing without cranberries and cranberry products. The effec- tiveness of the cooperative advertising programs could conceivably create customer ill will, if they were unable to satisfy consumer de- mand. Customer demand for this type of an agricultural product is not like a water faucet that can be turned off and on at will, as there must be berries or berry products to sell at all times and consumers willing to buy.

Another risk of which the industry must be constantly aware is the danger of pricing their products too high. Over-pricing these products would divert the consumer to cheaper competitive foods. Over- pricing would be a calamity to the industry.

Banks -with the Grower

From the correspondence received from the banks in the princi- pal growing regions of the country, one must conclude that the credit experience of the banks with the growers has, on the whole, been mainly satisfactory. Only two of the banks reported having experienced a loss from any loan to the cranberry grower. Several did report that they have had some bothersome workouts. These workouts were loans that probably should not have been made by a commercial bank or possibly not in the anounts originally advanced. The short prices received by the growers during the 19li8-1950 period did not give a sufficient margin to allow for the amortization requirements called for in those notes. Prior to 19hS) the banks in the western-growing regions appraised bog property much higher than was the practice in the East. The unsecured crop mort- gages were like wise dependent for their payment on the proceeds received by the grower. Hence, if the net return to the grower was insufficient to cover his living expenses, taxes and other current demands upon that income, there would be little or no surplus left to pay his loans to the bank.

Banks with the Distributing Agencies

The distributing agencies herein referred to are the private growers and companies engaged in the distribution of the fresh fruit. In the cranberry industry these individuals are referred to as the in- dependents. The troubles which beset the organized industry in the years 19U8-1950, which were in a degree caused within the organized in- dustry, were aggravated to a considerable extent by the actions of cer- tain independents. The independents claimed that since they had no ad- vertising program to support, they could sell their berries cheaper than the cooperatives, and still make a profit. The actions of a few of the independents in selling their berries from fifty cents to one dollar a barrel under the price asked by the cooperatives, together with the practice of some of the independents in selling their berries on a consignment basis were important contributing factors in demoraliz- ing the markets in those years. The low prices received for cranberries in those years were generally felt by the industry at large. The organ- ized growers blaned the low prices received unon the independents, and the independents, in turn, blamed the cooperatives for the low prices. The independents, competitors to the cooperatives, shipped, in 19^0, 271,688 barrels of cranberries to the fresh fruit market, or approxi- mately U6c9/S of all fresh berries produced in the United States. *^^ Hence, it can easily be seen that the independents in acting alone exer^ a powerful influence upon the fresh cranberry market. There were few reported instances in 1951 of the independents straying away from the organized price set and received by the cooperatives.

The apparent philosophy of the independents in those years of the large crops was to sell their crops as quickly as possible at

) 9

American Cranberry Exchange, Annual Report, If arch 31, 19^0, p. 5.

-57-

the best price a distressed product would bring in a buyer's market. The actions of a few of the independents were deliberately planned to hurt the organized industry because of an animosity they held for the cooperatives.

However, in spite of the reasons for, or tiie methods used by the independents to market their crop, the overwhelming banking experience has been favorable „ It has been the observation of the writer, gleaned in the course of examining banks throughout Massachu- setts, and from conclusions drawn from conversations with some of the growers referred to above, that they have gone out of debt each year. As a matter of fact, some of these independents have not requested banking accommodations for several yearso The writer has no reliable means of knowing whether some of these independents seek their credit requirement from sources other than conmercial banks «

From the interviews the writer had with several bankers in the ilassachusetts-growing regions, the impressions were conveyed that they stand ready and willing to extend financial assistance to these independents, either on a secured or an unsecured basis.

Banks with the Cooperatives

The National Cranberry Association, the large processing co= operative, has a line with the Springfield Bank for Cooperatives, under which it borrows for operating requirements and for working capital purposeSo The seasonal short-term loans are liquidated through sales of the processed fruit. The working capital loan is arranged on a dir- ect reducing basis extending over a period of years.

On May 31, 1951^. the amount owed to the Bank for Cooperatives by this processing cooperative included $1,000,000 on an operating loan and $2j500,O00 on a term loan ■vdiich is secured by first mortgages on the real estate located throughout the United States. On November 30, 1951, the working-'capital loan had increased to $3^600,000, while the term loan was reduced by $100,000, This latter obligation was reduced $350,000 in 1951.

The agreement \inder which the processing cooperative borrows from the Springfield Bank for Cooperatives requires that it maintain an investment in stock of the Bank, the amount of which is related to the amount of outstanding loans on November 30, 1951.9 the company showed $300,000 invested in such stock, ^ich security was pledged as additional collateral to the loan.

Operating loans are obtained from the bank by the National Cranberry Association in the autumn of the year lihen processing opera- tions are begun, and are repaid y4ien realization of the year's sales has been attained. As of the fiscal year end. May 31, 1950, these loans amounted to $1,750^000 and as of May 31, 195lj these loans amounted to $1,000,000. However, these working capital loans had increased to $3,600,000^3 as of November 30, 195l« The agreement

National Cranberry Association, Financial Report, November 30, 1951.

=58-

under which these loans are granted contains the usual warranties and covenants -tiiich are usual on loans of this type„

The loans granted by the Springfield Bank for Cooperatives to the National Cranberry Association are, strictly speaking^ demand loanso They do not represent long-term financing of the irorking and equity capital requirements of the processing cooperative„

Under ihe loan agreement Sj the management control of the National Cranberry Association today is largely in the hands of the bank rather than the company's officers. No important business action can be taken by the operating management without the approval of the Bankc

Interviews with executives of the Springfield Bank for Co- operatives indicated that a friendly and cooperative attitude was shared with the managanent of the National Cranberry Associationo The president of this borrowing cooperative is also a director of this banko These same officers consider their bank is better equipped to handle the needs of an agricultural cooperative than are comnercial bankSo Similarly, they feel that they are closer to agriculture's basic problems, and having studied these problems thoroughlyj they are so situated that they can view the problems of the cranberry in- dustry more sympathetically than can a commercial bank. The Spring- field Bank for Cooperatives is in a large degree responsible far the continued improvement of the borrower and they expect that the real estate loan will be liquidated before maturity,, They are satisfied with the performance of the loans to the National Cranberry Associa- tion and do not expect to lose this business to commercial banking now that the company is in a much stronger financial position.

The Consolidated Statement of the Financial Condition of the National Cranberiy Association as of November 30, l?^!* the date of peak debt position, shows Cash, Receivables after adjustment for Doubtful Accounts, Inventory after allowance for Inventory Adjustments, together equal $9bP80,793<.12 and more than covers the Total Liabilities of $7,2lU,l66„0$o^'^ The National Cranberry Association's statement at the close of its current fiscal year, May Jl^ 19^2, is expected to show continued improvemento

The credit experience of the banks with the so-called "sales oompanies," The New England Cranberry Sales Company, The American Cran- berry Growers' Association (New Jersey), and the Wisconsin Cranberry Sales Company has been satisfactory for all seasonal loanSo These "sales comoanies" experience no difficulty in obtaining their seasonal credit requirements firom the commercial banks.

Only the New England Cranberry Sales Company ventiired into fields of endeavor beyond the latitude of its original objectives. The pvirpose of this organization being defined in Article I of its By-Lawss='"to do business at cost for the benefit of its members and promote the interests of growers and consumers of cranberries ty co- operating in packing and distributing, and by standardizing packing

1^

Idem„ p, 98 <

-59-

and quality under reliable brands." This company - following the practice of the National Cranberry Association - in order to obtain new members and to retain members began lending financial assistance to the growers both on an unsecured and a secured basis. The funds used for this purpose were diverted from the Operating Fund (The Company's Working Capital) which was accxmulated by withholding for a ten-year period a percentage of the growers' gross sales. The funds so acquired were sufficient for normal operations. However, when this company started lending financial assistance to the growers, the Operating Tund in time became tied up in bog Mortgages and un- secured seasonal loans. The bog mortgage loans were written on a demand basis, but with the understanding that "they would be liquidated at the rate of ten per cent per year. Consequently, in order to main- tain adequate working capital, the company resorted to bank credit, the original intention being to hypothecate the mortgages as collateral for the bank loans.

Many of these mortgages offered as collateral were fo\ind to be unacceptable to the bank because of faulty titles to the mortgaged property. Credit arrangements were -worked out on a short-term basis secured by mortgages on the company's physical properties and the cooperative mortgages were held as additional collateral.

It is beyond the intent of this paper to discuss the finan- cial complication that arose within the company because of the improper use of credit. Suffice it to say, that these loans became troublesome workouts for the lending bank. Slow progress was made in liquidating these loans during the very recent years of bumper crops, when the en- tire crop could not be sold and large carry-overs developed. However, during the last two years, with more favorable prices being received for cranberries, the bank indebtedness was reduced $2Ul,000. Mr. John W, Wales of the First National Bank of Boston estimates that this loan will be entirely liquidated in another two years, provided satisfactory crops are raised and prices hold.

CHAPTER VIII

FUTURE OUTLOOK OF THE INDUSTRY

The future of the cranberry industry in the United States would be difficult to project. The 19^1 crop was disposed of at prices ■which were quite satisfactory to the cranberry growers o The better re- turns for this crop have created optimism among grower s, and the winter sanding operations have been reported in all the cranberry=growing re- gionso This sanding should result in higher yields and even better returns for the cranberry grower in this and succeeding years.

From a production standpoint the outlook is indeed optimistic , Throughout the growing regionsy the conditions of the bogs are good and the growers are hopeful of harvesting a large crop in 19^2, the pre- liminary estimates being based on heavy budding and new acreage expected to get into full production this year. Again, the existing bogs will be more intensively cultivated this year with the promise of a profit- able harvesto The cooperatives will gear their sales and merchandising programs to sell the crop at or above the stabilized opening prices. Their objective first will be to nane a price, which will be high enough to get the most the market affords while keeping the buying sup- port of the ultimate consumer, yet low enough so that it will not have to be cut during the peak marketing season »

The working agreement between the American Cranberry Exchange and the National Cranberry Association will be continued for an indefin- ite period through the Cranberry Growers' Council, The Council's pro- gram for allocating a percentage of the total crop to the fresh fruit market, and the remaining part of the crop set aside for processing proved successful this past yearo If the pattern developing from that year's marketing program of both fi^esh and canned cranberries is used as a basis for future policies, it will result in the most suc- cessful decade for cranberry growers that has ever been experienced.

The success of the Cranberry Growers' Council Programs will be dependent to a large extent upon the adherence to its recommenda- tions by the several contracting oarties. The Co^^ncil is made up of members from the Board of Directors of the two coonerativeso They are all men of diaracter, ability, responsibility and have large financial interests in the cranberry business. They feel a tremen= dous resDonsibility for the whole industry. They know that the whole industry must succeed if any grower in it is to prosper. The program they recommended last year isroved a success. However, one year's results are hardly enough to chart a true a;rid fast course for the coming years. The 195'1 program proved that the various factions within the industry could cooperate and maintain a spirit

-60-

-61-

of \mity throughout the industry. This limited working together of the cooperatives in 1951 is one of the most important happenings to the entire cranberry industry in recent years.

Specialized farming, such as cranberry culture, will have occasional poor years and ups and downs in the price structure, but successful operations can be assured if this industry does not en- counter major difficulties. These difficulties are internal. If the fresh fruit industry develops attitudes whereby they antagonize the processors, the industry will lose ground and all growers will suffer. By the ssme token, if processors attempt to dominate the cranberry industry at the expense of the fresh fruit, the entire in-- dustry will be adversely affected. If the fresh fruit marketing agencies start antagonizing one another, there will be chaotic con- ditions within the industry. If the various nrocessing groups start jockeying for position, trouble is bound to ensue. Regardless of where the internal friction might develop, it is always the grower who suffers. If the cooperatives can work in harmony during 1952, it will possibly prevent internal conflict from wrecking the indus- try. If the Council's reconmendations are followed by the industry at large during the next few years, the industry will grow and prosper.

The guiding hand of John C, Ifakepeace who has been closely identified with the cranberry industry for over fifty years will con= tinue to be the "stabilizing" influence of the Cranberiy Growers' Council, The influence, control and respect this gentleman enjoys throughout the industry will continue to exert a strong restraining influence on people within the industry, who would act other than for the common good.

The new General Manager, Harold E„ Bryant, of the American Cranberry Exchange has been much more successful than his predecessor in reqiiiring all members to adhere to the Council's recommendations which greatly contributed in stabilizing the industry during the past year.

The future outlook for the cranberry industry is decidedly bright for the years to come. The problems that confront the indus- try are those of its own makings which can only be solved through the subordinating of personal ambitions to the common good of the industry. The lessons taught to all the industry during the last few years were that more cooperation means more stabilization and better prices. The value of cooperation was effectively demonstrated in 1951 when the two cooperatives adhered to the Council's decisions.

The future of the industry depends upon the cooperatives working harmoniously for the well being of the industry through their active support of the decisions of the Cranberry Growers' Council.

CHAPTEH IX

CONCLUSION

With the passage of time, there will be fewer growers engaged in cranberry ctilturec There is a tendency on the part of the larger operators to acquire the properties of the small part-time operator and accordingly increase their cranberry bog acreage,, Higher production will be obtained through a more intensive and scientific cultivation of existing bogSo The cranberry grower will be forced by the scarcity and high cost of skilled labor to resort to a far greater degree of mechanization in all phases of cranberry cultivation. It requires mechanization coupled with the increased use of scientific knowledge today for success in cranberry culture,

■^t is within the realm of possibility that Wisconsin may, within a few years, surpass Massachusetts by becaning the largest producer of cranberries in the United States, The cranberry produc- tion of Washington may, in a few years, exceed the production of New Jersey, Wiseonsin and the West Coast States have ample suitable marsh land available for expansion. Further, the weather in those states is quite favorable for cranberry production and the yields per acre exceed those obtainable in the eastern states growing regions.

There appears no immediate possibility of a consolidation between the cooperative engaged in processing cranberries and the cooperative engaged in marketing the fresh fruit. The best interest of the cranberry grower can be served only by a true consolidation between these two cooperatives. The price relationship between the two is so closely related that they cannot advertise, merchandise, sell or move cranberries in one form without having a direct effect on the other organization. The passage of time will remove any dominating influence in the cranberry industry and when that occurs, lasting harmony and stabilization should come to the cranberry in- dustry.

The two cooperatives have extended the working contract with the Cranberry Growers' Council for an indefinite period. This relationship between the two cooperatives proved successful this past year in bringing stabilization to the industry. The stabiliz- ing influence of the Cranberry Growers' Council was Mr, John C. Makepeace and as long as he remains active in the affairs of the Council,, it will augur well for the entire industry.

The banks have an obligation to supply the areas they serve with all justifiable credit requirements. Today, the cran- berry industry is for the mo st part financially sound and the

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=63=

future of this industry is bright. The cranberry industry is preparing to raise and sell an annual million barrel crop„ To raise crops of this size will require greater mechanization and the employment of the latest scientific techniques in cranberry cxilture. The mechanization of this industry will create a large potential of new business for the commercial banks in the several growing regions « The cranberry indus- try anoears ready to offer these commercial banks an opportunity to make constructive and profitable short-term loans „ However, these conmercial banks will be required to compete with the aggressive lend- ing policies of governmental lending agencies and the Cranberry Credit Corporation for this business. The commercial banks to compete for this business must recognize the necessity for arranging terms to fit the particular borrower and adjust maturities to coincide with the sale of the cropso

Conservatism and caution are indicated for all long-term loans to ■Uie cranberry industry until a greater degree of harmony exists within the industry and the markets for cranberries remain stabilized.

This thesis has not treated at length upon the research presently being done in the cranberry industry toward developing new varieties of cranberries and disease-resistant vines and berrieso It is not within the province of the writer to suggest new channels of ^thought to those engaged in this research. However, exploration of the use of X-Rays and atomic radiation in treating vines to develop new varieties and disease-resistant strains should merit consideration. These newer approaches in scientific research have proved successful in other branches of agriculture, so possibly they would likewise be helpful to the cranberry industry.

APPENDIX A

-61;-

Exhibit I

1

CASH COSTS OF BOG OPERATION

I I

M H 5

Acreage

Expense Items - 2 Regular Labor - 3 Harvesting - k Sanding Other Labor Insect Control Weed Control - 5

Hot Control

Coop Services - 6

355

220

7k

h

205

175

18U

1^200 6751i 8378 17820

lliOU 1620 2216 li73l* 21360

3li2 1159 8180

79 370 220 1215

155 2732 2780

& supplies

281 & supplies 311; 2U

750 1700 865

supplies

382

93 2

$2U16

578	31ii	637
325		680
85		200
568	111;?	360li
36	liliO	705 335

18687 $13133 $26109

5180 ii230 2395 U510 3U90

$702U5

Sand

Fertilizer

Gas^ Oilj Electri- city (inclo truck- ing) 15

Mach, Repairs 7U

Bldg, Repairs 5

Taxes 113

Insurance

Interest - 7 li80

Total Cash Items $1720

Bog Yields, bbls,-8 UO 766 1500 900 2855 10100

Cash Cost $i;„20 $3»l5 $5c79 $lli.60 $ 9.15 $ 7«00

1- Values have not been assigned to the operator's labor, family labor, inter- est on ovmed investment accrued depreciation^, as these would be arbitrary, tending to confuse costs with desired returns.

2- An effort has been made to include all major items, A few minor ones like frost service may be in with telephone and electricity or omitted. In gen- eral reliance was placed on the operator's record,

3- Labor for some seasonal operations appears in case IV and VI, h- Includes costs for floats where harvestedo

5- Some weed control expense is obviously imder regular labor c

6- Supolies occasionally included insecticides^, containers and herbicides „

7- Interest shown on indebtedness is included,

8- Based on 19U8 yields rather than nonnalized oneSo

Source? Crossmonj 3, Doj, "Production Costs - The Area of Grower Choice," Cranberries, (January, 1951), Vol, 15^, No, 9,0 Pe 7o

-65- APPENDIX A Exhibit II

CRANBERRY HIODUCTION IN THE UNITED STATES (Barrels)

	Av,	Av.
State	1930-39	19iiO-U9	I9l|9	1950	1951
Massachusetts	Ul2,l;00	1468,600	520,000	610,000	590,000
New Jersey-	10^,700	75,1^00	67,000	108,000	76,000
Wisconsin	68,600	137,000	200,000	219,000	190,000
Washington	12,300	35,100	1;0,000	33,000	56,500
Oregon	Il,600	12,100	13,I|00	li;,300	20,000

TOTAL 603,600 728,200 81;0,U00 984,300 932,500

Source: United States Department of Agriculture, Bureau of Agricultural Statistics.

-66- APPENDH A Exhibit III

PROVISIONS OF THE CAPPER-VOLSTEAD ACT

The Capper-Volstead Act of 1922 grants the right of collec- tive bargaining to members of agricultural cooperative organizations ■which meet the following requirements?

Sec. 1 "That no member of the association is allowed more than one

vote because of the amount of stock or membership capital he may own therein, or that the association does not pay- dividends on stock or membership capital in excess of eight percent per annum, and

that the association shall not deal in the products of non- members to an amount greater in value than such as are han- dled by it for memberSo Cooperatives satisfying these re- quirements are, moreover, exempted fl°om both State and Federal Income Taxes «"

Sec, 2 "Authorizes the Secretary of Agriculture, aifter complaint,

notice and hearing, to issue * cease and desist' order when he finds that 'price of any agricultural product is unduly enhanced* by reason of such association restraining trade. "■'•

Exhibit IV

"The opinion of the Court in these (Sherman Act) cases con- stantly refer to monopoly in the sense of control of the market, but little examination of evidence pertinent to the question of market control is ever undertaken, . , American Courts have in this class of cases been willing to accept the contract itself as evidence of restriction and, conse- quently, of an attempt to monopolize without inquiring fiir- ther into the question of how great a control of the market is secured by the contracting partiesc2 Although 'undue' or 'unreasonable' control of the market is constantly in- serted in judicial decisions as to the meaning of monopoly, the data capable of indicating this control are almost uni- versally ignored by the Courts, "3

^Nourse, L, S,, "Legal Status of Agricultural Cooperation," Institute of Economics, (MacMillan,, New York, 192?), pp. 2^2-261, .. .

2

Mason, E, S,, "Monopoly in Law and Economics," Readings in the Social

Control of Industry,, (Philadelphia, 19l|2), pp. 25-ii7 - Reprinted from Yale Law Journal, 1937.

^Ibid, p. UO,

elusive.

BIBLIOGRAPHI

Reports and Pamphlets American Cranberry Exchange „ Annual Reports 19l|6-1950 in-

American Cranberry Growers' Association, Annual Reports 19UO-19?0 inclusive „ Pemberton, New Jersey o

BooZj Allen and Hamilton, The Cranberry Industry ^ Report presented to Joint Meeting of Directors of the American Cranberry Exchange and Cranberry Canners, InCo New York, April 2I45 19l;5o

B00Z5 Allen and Hamilton, Survey of the American Cranberry Exchange^ Report presented to the Board of Directors of the American Cranberry Exchange. New York, April 23, 19ii5o

Booz, Allen and Hamilton, Survey of Cranberry Canners, Inc, Report presented to the Board of Directors of Cranberry Canners, Inc. New York, April 23s 19il5.

Doehlerb, Charles A,, "Looking Ahead to Some New Cranberry Research," New Jersey Agricultural Experiment Station, Pemberton, New Jersey,

Estes, C, ¥0 and Morris, W„ W„, Wisconsin Cranberry Produc- tion and Marketing, Wisconsin State Department of Agriculture c Bul- letin No. 299, JSiuary-February, 1950,

Franklin, Henry J, and Cross, Chester E,, Veather in Relation to Cranberry Production and Condition, Massachusetts Agricultural Ex- oeriment Station, BulletiTi No. iiSO, July I9U80

Franklin, Henry J», Cranberry Growing in Massachusetts, Massachusetts Agricultural Experiment Station, Bulletin No, hhlo April I9U8,

Franklin, Henry J, Weather and Cranberry Production. Massachusetts Agricultural Experiment Station, Bulletin No„ ii33o June I9I46.

Frick, G, E„ and Weeks, S„ B.^ "When to Hire and When to Own Farm Equipment." The University of New Hampshire Extension Service in Agriculture and Home Economics, Durham, New Hampshire, Extension Cir- cular No, 302, March 1951,

-67-

-68=

BIBLIOGRAPHY

Reports and Pamphlets - Cont.

Gimness, C, I., Cranberry Storage Investigation. Massachu- setts Agricultural Experiment Stat ion „ Bulletin No, 370. February I9I4I0

New England Cranberry Sales Company » Annual Report Sy 19^10-1950, inclusive.

Stevens, Co D.^ Piper, W„ E., Franklin, H. J, and Chandler, 7, B.j The Cranberry Industry in Massachusetts. Bulletin No, 139. June 191^8.

Tomlinson, Bertram and Franklin, H. J., Renovation of Cranberry Bogs. Cape Cod Extension Service, Barnstable, Massachusetts. Special circular No. 55, April 19li6.

Waugh, F, v., BurbiSj, E. L. and Wolfe, A. F., "The Controlled Distribution of A Crop Among Independent Markets," (Harvard) Quarterly Journal of Economics, Vol, 5lo (November 1936)

Periodicals

"The Cape-Tip Breeze," The Pilgrim Arts and Crafts. Province- town, Massadiusetts. August 1951.

Capel, George L. and Samuels, J, K,, "Cranberry Growers Pool Their Efforts," News for Farmer Cooperatives. United States Deparlanent of Agriculture, Farm Credit Administration. December 1951.

Cranberries. Published by Clarence J. Hall, Warehara, Massachu- setts. May 19U6. Vol. II, No, 1 through April 1951, Vol. 15, No. 12.

Cranberry News. National Cranberiy Association. January 19ii9, Vol. 10, No, 1 through January 1952, Vol. XIII, No. 1.

Cranberry World. American Cranberry Exchange. January IpW, Vol. 1, No. 1 through March 1952, Vol. 5, No. II.

"Cranberry Skin Keeps Its 'Shine', A Fair Parable." Food Marketing in New England. November I9I16, Vol. 7, No. 3.

Crossmon, B. D., "Production Costs - The Area of Owner Control," Cranberries. January 1951, Vol. 15, No, 9.

Dickey, A. G., "Cranberry Picking Prowness of Unknown Portugese," Food Marketing in New England. November 1951, Vol. 12, No. 3.

"Forestry in An Urban State." Monthly Review. Federal Reserve Bank of Boston, Vol. 3ii, No. 2, February 1952,

Hyson, Charles D. and Sanderson, Fred H,, "Monopolistic Dis- crimination in the Cranberry Industry," Quarterly Journal of Economics. Harvard University. Vol. 59o (19Ui;-19U5).

Litchfield, L, H.j, "It's the Cranberries," Powertrax. Inter- national Harvester Ccsnpany, Vol. 7, No. 1, April 1936.

-69- Periodicals - Cont.

Mason, E, S,, "Monopoly in Law and Economics." Readings in the Social Control of Industry. (Philadelphia, 19U2) Reprinted from Yale Law Journal, 1937.

"New England - 19^1." New England Newsletter. December 19^1, No. 333.

"The New England Farmer in 19^1, His Position, His Problems, His Prospects." New England Newsletter. June 19^1. No, 327.

Government Documents and Reports

Agricultural Statistics - 19^0. United States Department of Agriculture, Washington, D. C.

Crop Reports. United States Department of Agriculture, Bureau of Agricultural Economics. New England Crop Reporting Service,

Bain, H. F,, Bergman, H. F., and Wilcox, R. B., Harvesting and Handling Cultivated Cranberries. United States Department of Agri- culture , Farmers' Bulletin No, 1092, January 19^2, Washington, D. C.

Capel, George L,, "Opinions of Buyers on the Marketing Program of Cranberry Cooperatives." United States Department of Agriculture, Farm Credit Administration, Miscellaneous Report No, 1^1;, November 1951.

Hob son, Asher and Chaney, J, Bui^n, Sales Methods and Policies of a Growers' National Marketing Agency. United States Department of Agriculture, Bulletin No. 1109. Washington, D. C, January 16, 1923.

Corre spondence

E, L, Bartholomew, President, Cape Cod Cranberry Growers' Association, Wareham, Massachusetts,

Ray W. Bates, Director, American Cranberry Exchange, Bandon, Oregon,

M, C, Beaton, President, John J, Beaton Company, Wareham, Massachusetts

A. D. Benson, Secretary, Cranberry Growers' Council, Inc., Middleboro, Massachusetts.

Arthur D. Benson, Manager, New Eng!land Cranberry Sales Company, Middleboro, Massachusetts.

Henry J. Boone, Editor, Burroughs Clearing House, Detroit, Michigan.

Harold E. Bryant, General Manager, American Cranberry Exchange, New Bedford, Massachusetts.

(Miss) Betty Buchan, Publicity Editor, National Cranberry Ex- change, Hanson, Massachusetts.

=70"

Correspondence - Conto

Theodore H, Budd^, Sr., President, The American Cranberry Exchange, Bordentown, New Jersey,

Reidar Bugge, President, The Coos Bay National Bank of Marshfield, Coos Bay, Oregon,,

D„ Go Colkett, Manager, The National Bank of Commerce of Seattle, Hwaco Branch, Ilwaco, Washington,

Orrin Q, Colley, President, Cape Cod Cranberry Cooperative, InCo, Plymouth, Massachusetts,

D, J, Crowley, Superintendent, Cranberry Blueberry Experiment Station, Long Beach, Washingtone

Harold S, DeLong, Vice President, American Cranberry Exchange, Mather, Wisconsin,

Charles A, Doehlart, Associate Tlesearch Specialist, Cran- berry and Blueberry Culture, Rutgers University, Pemberton, New Jersey,

Walter H„ Ebling, Agricultural Statistician, Wisconsin State Department of Agriculture, Madison, Wisconsin,

Homer Lo Gibbs, President, New England Cranberry Sales Co,, Middleboro, Massachusetts,

Clarence Jo Hall, Editor, Cranberries Magazine, Wareham, Massachusetts,

Co D, Hammond, Jr,, General Manager, General Manager, Tfisconsin Cranberry Sales Company, Wisconsin Rapids, Wisconsin,

R. J, Hillstrom, Manager, Western Pickers, Inc, Coos Bay, Oregon,

John I, Kross, Associate Professor of Agricultural Economics, The University of Wisconsin, Madison, Wisconsin,

Richard J, Lav/less, President, Wood County National Bank, Wisconsin Rapids, Wisconsin,

Dominic A, Marini, Assistant County Agent, Plymouth County, Brockton, Massach.usettSo

E„ H„ Maxey, Assistant Cashier, Grays Harbor Branch, The National Bank of Commerce of Seattle, Aberdeen, Washington,

George Lo Moore, Editor, Food Marketing in New England, First National Stores, Somerville, Massachusetts,

Dr, R, J, Penn, Director, Department of Agricultural Economics, University of Wisconsin, Madison, Wisconsin,

-71-

Correspondence - Cont.

5. H. Peterson, Jr., Manager, Coquille Branch, First National Bank of Portland, Portland, Oregon.

Chester E, Robbins, Secretary, Cranberry Growers' Mutual, East Freeto-wn, Massachusetts,

D. C. Silverthome, Vice President, First National Bank of Portland, Portland, Oregon,

Aurilla Smith, President, Northwest Market Research, Minneapolis, Minnesota,

L. A. Sorenson, Manager, Midwest Cranberry Cooperative, Wisconsin Rapids, Wisconsin,

W, J. Sweet, President, Bank of Bandon, Bandon, Oregon.

United States Department of Agriculture, Farm Credit Adminis- tration, Washington, D, C,

Marcus L. Urann, President, National Cranberry Association, Hanson, Massachusetts.

Jack Ho Wood, Co\mty Extension Agent, Coos County, Oregon Interviews

Henry W. Barnes, Jr., Cashier, Plymouth National Bank, Plymouth, Massachusetts,

M. C. Beaton, President, John J. Beaton Company, Wareham, Massachusetts.

Richard J, Beattie, Cranberry Specialist, Massachusetts Agricultural Experiment Station, Wareham, Massachusetts

Arthur D„ Benson, Manager, New England Cranberry Sales, Middleboro, Massachusetts,

Arthur D. Benson, Secretary, Cranberry Growers' Council, Inc., Middleboro, Massachusetts.

Harold E, Bryant, General Manager, American Cranberry Exchange, New Bedford, Massachusetts.

Edward "W. Burgess, Grower, Plymouth, Massachusetts.

Bernard Colby, Executive Vioe President, Federal Intermediate Credit Bank, Spr'ingfield, Massachusetts.

Reginald T„ Cole, Executive Vice President, Brockton National Bank, Brockton, Massachusetts.

Dr. B. D. Crossmon, Research Professor in Fam Management, Harvard University, Cambridge, Massachusetts.

A. R„ Doe, Treasurer, Springfield Bank for Cooperatives, Springfield, Massachusetts.

-72-

Interviews - Cont,

Cyril B, Downs, Treasurer, Wellfleet Savings Bank, Wellfleet, Massachusetts.

Henry J, TVanklin, Director, Cranberry Experiment Station, Commonwealth of Massachusetts, Wareham, Massachusetts.

W, Co Fridstrom, National Bank Examiner, Boston, Massachusetts.

J, Eo Glover, First Vice President, National Cranberry Associa- tion, Hanson, Massachusetts.

Thomas J. Green, President, First National Bank, New Bedford, Massachusetts,

Hollis Haggard, Chief National Bank Examiner, Boston, Massachu- setts.

J. F„ Harriott, Treasurer, National Cranberry Association, Hanson, Massachusetts.

Michael J. Hurley, Vice President, National Shawraut Bank, Boston, Massachusetts.

C, B, Hutchins, Executive Vice President, Federal Land Bank, Springfield, Massachusetts,

G. W. Lamb, Executive Vice President, Springfield Bank for Cooperatives, Springfield, Massachusetts,

E, Laughery, Director of Research, National Cranberry Associa- tion, Hanson, Massachusetts,

Harold G, Lawson, Cashier, Brockton National Bank, Brockton, Massachusetts,

John Co Makepeace, Treasurer, A, D. Makepeace Cranberry Company, Wareham, Massachusetts.

Dominic A, Marini, Plymouth County Agent, Commonwealth of Massachusetts, Brockton, Massachusetts.

Carleton Shurtliffe, Grower, North Eastham, Massachusetts.

Harold J, Randall, National Bank Examiner, Providence, Rhode Island.

Roger ¥, Tillson, President, Kiddleboro Trust Company, Middleboro, Massachusetts.

Edward J. Tivnan, National Bank Examiner, Boston, Massachusetts.

John J. Wales, Vice President, First National Bank of Boston, Boston, Massachusetts,

Joseph W. Whitcomb, Vice President and Cashier, National Bank of Wareham, Wareham, Massachusetts.

^-/D7-J77

O

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