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Marketing Research Report No. 191, August 1957.

Table 4.—Cotton produces: Average retail cost of a family's purchases of 42 articles

and of 3 individual articles of clothing, farm value of equivalent quantities of cotton,

marketing margin, and farmer's share of retail cosi, 1927–57 1-Continued

Market- Farmer's

ing share

margin (percent)
Annual estimates are simple averages of data for March, June, September, and December.

Retail costs were originally computed from prices collected by the Bureau of Labor Statistics, weighted

by average number of articles purchased annually by families of wage earners and clerical workers (from

1934-36 survey). Beginning 1943 retail costs are based on indexes of retail prices of cotton clothing and

housefurnishings prepared by the BLS.
* Estimated prices received by farmers for cotton of grade and staple lengths used in the manufacture of
the various articles, weighted by quantities of cotton required.
Before payment of processing tax which

was in effect from August 1933 to January 1936. The tax on the

quantity of cotton required amounted to 37 cents in 1933 and 89 cents in 1934 and 1935.

Preliminary.

MARGINS, COSTS, AND PRACTICES PUBLICATIONS ISSUED, JANUARY 1957–

FEBRUARY 1958

Do Trading Stamps Affect Food Costs, AMS, Marketing Research Report No.

147, January 1957.

Losses from Quality Deterioration and Shrinkage for Corn Resealed on Iowa

Farms, AMS-166, March 1957.

Development of the Commercial Poultry Slaughter Report, AMS-174, March

1957.

Lamb Marketing Costs and Margins, Marketing Research Report No. 159, April

1957.

Lamb Prices, AMS, Leaflet No. 413, April 1957.

Losses from Shrinkage and Quality Deterioration of Corn Stored in Country

Elevators and at Bin Sites Iowa, AMS-173, April 1957.

Special Margins and Costs Studies, Marketing Research Report No. 167, April

1957. (Reprinted from hearings (pt. 2) before the subcommittee of the Com-

mittee on Appropriations, House of Representatives, 85th Cong., 1st sess.)

Marketing Molasses in the Feed-Mixing Industry, AMS, Marketing Research

Report No. 174, May 1957.

Trading Stamps and the Consumer's Food Bill, Marketing Research Report No.

Orange Tree to Breakfast Table: Marketing Costs and Margins for Florida

Oranges

, Marketing Research Report No. 164, June 1957.

Processing Poultry Byproducts in Poultry Slaughtering Plants, Marketing Re-

search Report No. 181, June 1957.

The l’se of Packing Labor in Florida Citrus Packinghouses, Florida Agricultural

Experiment Station Agricultural Economics Mimeo Report 57-8, June 1957.

A Method of Allocating Citrus Packinghouse Costs, Univ. of Florida Agricultural

Economics Mimeo Report No. 58–1, July 1957. Univ. of Florida in cooperation

Conversion of Small Hydraulic Cottonseed Oil Mills Into Higher Oil-Yiel-ing

Mills, Marketing Research Report No. 187, July 1957.

Costs of Packing Colorado Peaches in 1956, Marketing Research Report No. 179,

How Bulk Assembly Changes Milk Marketing Costs, Marketing Research Report

Marketing Margins and Practices for Turkeys Sold in Three Eastern Markets,

Costs and Elliciency in House Packing Western Head Lettuce, California Agri-

cultural Experiment Station Mimeo Report No. 199, September 1957.
Costs of Butterfat Sampling and Testing Programs, AMS-212, October 1957.
Quality and Cost of Ginning American-Egyptian Cotton, Seasons 1952-53 and

1953-54, Marketing Research Report No. 199, October 1957.
Case Study of Labor Costs and Efficiencies in Warehousing Formula Feeds,

Marketing Research Report No. 205, November 1957.
Cost Standards for a Model Stationary Custom Feed Mill for the Midwest,

Preliminary Report, AMS-215, November 1957.

Farm-Retail Spreads for Food Products, Miscellaneous Publication No. 741,

November 1957.

Marketing Charges for California Long White Potatoes Sold in Los Angeles,

Chicago, and New York City During the 1956 Season, Marketing Research

Report No. 193, November 1957.

Marketing Costs and Margins for Chicken Fryers and Fowl Sold in Chicago and

Minneapolis-St. Paul, Marketing Research Report No. 195, November 1957.

The Wage Factor in Retailing Meat in 4 Cities, Marketing Research Report No.

202, November 1957.

Comparative Costs of Alternative Methods for Performing Specific Operations in

Florida Citrus Packinghouses, cleared for publication by Florida Agricultural

Experiment Station.
Milk Distributors Sales and Costs, issued quarterly.

REPORTS ISSUED IN OTHER PUBLICATIONS, JANUARY 1957-FEBRUARY 1958

Use of Trading Stamps in Marketing Food, Agricultural Marketing, January 1957.

Trends in Marketing Costs, Agricultural Marketing, January 1957.

Marketing Margins for Beef and Pork, The Marketing and Transportation Situa-

tion, January 1957.

Marketing Margins for Poultry and Eggs in the United States and Selected Cities,

The Marketing and Transportation Situation, January 1957.

Marketing Costs and Margins for Fruits and Vegetables, The Marketing and

Transportation Situation, January 1957.

Marketing Costs and Margins for Dairy Products, The Marketing and Transpor-

tation Situation, February 1957.

Trends in Marketing Lamb, Agricultural Marketing, May 1957.

Farm Food Marketing Bill, Agricultural Situation, September 1957.

How Can Dairymen Decide whether to Use Tanks? Agricultural Situation,

October 1957.

Slicing Up the Chicken Costs, Agricultural Marketing, October 1957.

Retail Marketing Costs for Turkeys, Agricultural Marketing, November 1957.

The Wage Factor in Retailing Meat in 4 Cities, Agricultural Marketing, November

1957.

Turkey Growers Like Selling on Grade-and-Yield Basis, Agricultural Marketing,

December 1957.

Livestock Markets Are on the Move, Agricultural Marketing, December 1957.

Marketing Costs Keep Going Up, Agricultural Marketing, January 1958.

Changes and Trends in Food Marketing Industries, Agricultural Marketing, Jan-

uary 1958.

The Shorter Workweek in Agricultural Marketing Industries, Agricultural Mar-

keting, January 1958.

How Do You Sell Your Turkeys? Agricultural Situation, January 1958.

Marketing Margins for Dairy Products, The Marketing and Transportation Situ-

ation, January 1958.

Farm-Retail Spreads for Poultry and Eggs in the United States and Selected

Cities, The Marketing and Transportation Situation, January 1958.

Price Spreads for Eggs in Washington, D. C., The Marketing and Transportation

Situation, January 1958.

Farm-Retail Price Spreads for Fruits and Vegetables, The Marketing and Trans-

portation Situation, January 1958.

Concentrated Whole Milk is a Qualified Challenge, Agricultural Marketing,

February 1958.

Power and Labor Costs, Agricultural Marketing, February 1958.
The Changing Market for Vegetables, Agricultural Marketing, February 1958.
Use of Soybean and Cottonseed Oil in Margarine and Shortening, Agricultural

Marketing, February 1958.

OTHER DISSEMINATION OF PRICE SPREAD INFORMATION,

JANUARY 1957-FEBRUARY 1958
Marketing Costs, by D. B. DeLoach, statement presented at the Annual Out-

look Conference, November 1957.

Marketing Costs, Farm Prices, and the Farmer's Share, by Kenneth E. Ogren,

statement presented before the Subcommittee on Agricultural Policy, Joint

Economic Committee, December 17, 1957.

Costs of Marketing Major Farm Products, by D. B. DeLoach, statement presented

before the Subcommittee on Agricultural Policy, Joint Economic Committee,

December 17, 1957.

USDA Television Service Package Program No. 190, Why Marketing Re-
search? February 14, 1957 (based on general publications, includes informa-
tion on margins and costs).
U'NDA Television Service Package Program No. 207, Delivering Your Food,

June 13, 1957 (based on Miscellaneous Publication No. 738).
USDA Television Service Package Program No. 248, Beef Goes to Market,

November 28, 1957 (based on Miscellaneous Publication No. 710).
[SDA Television Consumer Series:
Where Does Your Food Money Go?-
No. 1. The Price of Bread, July 1957 (based on Miscellaneous Publica-

tion No. 712).
No. 2. The Price of a Peach, September 1957 (based on general pub-

lications).
No. 3. The Price of Milk, October 1957 (based on Miscellaneous Pub-

lication No. 733).
No. 4. The Price of Pork, November 1957 (based on Miscellaneous Pub-

lication No. 711).

Line PROJECTS COVERED BY APPROPRIATION FOR SPECIAL STUDY OF PRICE SPREADS

AND MARKETING PRACTICES, JANUARY 1, 1957-FEBRUARY 1958

PROJECTS ACTIVE

OC 1-13. Flaxseed storage practices related to deterioration, costs, and returns

to growers.

OC 1-14. Effects of different methods of handling sugar on costs, margins, and

efficiency.

OC 1-20. Costs of grade change and shrinkage of wheat in different types of

storage.

OC 1-22. Quarterly measurement and analysis of margins, costs, and efficiency

in distributing fluid milk and cream products for 80 selected plants.
OC 1-24. Marketing costs and efficiency in the mixed feeds industry.
OC 1-26. Efficiency of marketing western grown head lettuce.
0C 1-29. Measurement of components of farm-to-retail price spreads for selected
food commodities on a continuing basis.
OC 1-32. Cost and efficiency of distributing milk through vending machines.
OC 1-34. Marketing margins and costs for eggs cartoned in the Midwest and sold

in distant cities.
OC 1-36. An economic analysis of costs and practices in handling and packing

early-crop potatoes.

OC 1-37. Economic analysis of poultry-dressing plants in New England.

OC 1-41. Economies in converting small cottonseed oil mills into higher oil-

yielding type mills.

0C 1-43. Cost and efficiency in wholesaling frozen foods.

OC 1-44. Costs and margins of marketing livestock, meats, and meat products.

OC 1-46. Analysis of farmer-to-consumer price spread in relation to marketing

agencies involved and services performed in the marketing of dairy products

in selected cases.

0C 1449. Economic and engineering studies of fruit and vegetable handling,

packing, and packaging.
OC 1-53. Effects of mandatory inspection on costs and efficiencies of poultry-

slaughtering plants.

OC 1-55. Economic effects of electronic and mechanical egg-grading devices on

the marketing of eggs.

OC 1-57. Costs and benefits of treatment and disposition of sewage from poultry-

slaughtering plants through irrigation systems.

OC 1–59. Evaluation of economic effects of trading stamps and other promotional

devices. OC 1-61. Development of improved costing procedures for poultry-slaughtering

plants. 00 2–53. Extent and effects of major labor-employment practices on the costs,

adequacy, and structure of agricultural marketing. OC 3-1. Marketing situation and outlook reports. OC 3-2. Development, maintenance, and analysis of farm-to-retail price spreads

and other marketing statistics on entire marketing process. OC 3-14. Providing statistical and economic information relating to the marketing of agricultural products.

PROJECTS INITIATED OC 1-38. Marketing costs and practices for peaches. OC 1-45. Marketing margins for oilseeds and animal fats used in the manufacture

of food products. OC 1-62. Costs of marketing fresh citrus fruits grown in Florida and Texas. OC 1-63. Margins, costs, and trade practices in marketing chicken fryers, eggs,

and turkeys in the San Francisco area. OC 1-64. Buying turkeys from producers on the basis of ready-to-cook weights

and grades. OC 1-65. Effects of keeping and utilizing proper records on the costs and efficiency

of processing and distributing dairy products. OC 1-66. Effect of dating regulations on costs of milk processing and distribution. OC 1-67. Margins, costs, and trade practices in marketing frying chickens, eggs,

and turkeys in the Northeastern States. OC 1-68. Analyzing price spreads, margins, and costs for grain and feed products, OC 1-70. Costs and efficiency in marketing eastern apples. OC 1-71. Costs and efficiency in operating alfalfa dehydrating plants. OC 1-73. Marketing costs and efficiency and the organization of the California

date industry. OC 2-99. Marketing of products of class III milk in the New York milkshed. OC 2–100. Effect of marketing changes upon marketing costs and upon demand

and consumption of poultry meat. Projects completed OC 1-40. Handling practices and marketing costs for Florida sweet corn. OC 1-42. Power and labor utilization in cottonseed oil mills. OC 1-47. Impact of St. Lawrence seaway on costs of marketing agricultural

products, with emphasis on grain and grain products.

INFLUENCE OF PRICE ON VOLUME OF FOODS CONSUMED

Mr. WHITTEN. Dr. Paarlberg, I think it will get us into a real depression if raw material prices continue to go down and down. It is my belief that it has led to depressions in the past. It disturbs me to see the press and many national leaders argue that the thing to do is spend more money on defense contracts. Defense contracts, at best, may be essential to our safety, but the defense dollar never contributed an earned income dollar to the Nation in history. It is a dead weight that we have to carry and it would be so much more sound, in my judgment, to see that the base of our economy, which is the raw material level, got its fair share of the national income dollar.

You and the Secretary constantly insist that by reducing the prices to the farmer you will increase consumption. Now it is my understanding that the lack of food is not what is bothering the United States, that we rather eat too much.

If the people in Florida gave away the citrus on the trees, or the people growing tomatoes in my State, around Crystal Springs, gave them away, or if the fellow producing cotton in my section just gave it to the mills, under our system I honestly wonder whether there would

be any increased consumption at all. It might shift from potatoes and hamburger to steak, but in total quantity of food consumed or in clothes worn, the average fellow would wear one suit a day. If the farmer gave it all away, I doubt if you would increase consumption 3 percent.

And under our system the commission man goes down to Florida and buys citrus and ships it north, and everybody marks it up to the point that they can get by with and still sell it. You might have a sittle drop in the citrus-fruit market the first 2 weeks but, so help me, after that if it were all given away the retail price would be right back at the thing which controls it, and that is buyer resistance.

Now do you still believe that reductions in these prices would increase consumption ?

Mr. PAARLBERG. Putting the whole thing together, in the aggregate, a reduction in price will be accompanied by a much, much smaller increase in consumption of agricultural products.

If you dropped the overall average price of farm products by 10 percent in the short run, the consumption would go up—well, different researchers have come out with different figures. I have heard figures like 1, 2, 3 percent—I don't know exactly what it would be. Now, over time, this figure would become larger as people became adjusted to it, as new markets were developed, export markets would grow.

Mr. WHITTEN. Well now, let's put it this way. Let's don't get export mixed up with this. There has never been any connection between export and support. Insofar as the law is concerned, there has never been any tie between export prices and support levels, has there!

Mr. PAARLBERG. The CCC operations permit exports at competitive prices.

Mr. WHITTEN. Let's take your family, the neighborhood in which you live or anywhere in this country. Now, you may have some lazy people, you may have some indigent people, you may have some elderly people, but is there anybody that doesn't eat about as much now as they would if the prices were different.

Will a change in prices change what you eat?

MI:. PAARLBERG. It will change what you eat. Given more time the changes will be larger.

Here is what would happen. They would consume more of highly palatable and highly nutritious foods like beef, livestock products in general. These products take a lot more in the way of human labor and land to produce a man's food supply than do some of the other products.

So that if the overall level of prices was dropped, as you indicated, and some time went on to permit the adjustments, we would consume, I think, pretty near the same amount of calories. We would consume more proteins, we would consume more meat and milk and eggs. We would consume more

Mr. WHITTEN. You are talking about changes now. Mr. PAARLBERG. We would consume more fruits and vegetables. We would consume probably less of wheat, potatoes, and similar foods.

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