PARAGRAPH 277-LEMONS. Agricoltura, Industria e Commercio Anno IX, vol. 1, serie C, p. 8), as determined by the Royal Commission charged with fixing the minimum price which the Government guarantees the producer for citrate of lime, the cost of producing 1,000 lemons, as determined by an inquiry among the growers in Palermo, Messina, Syracuse, and Catania, varies from a minimum of 3.25 lire to a maximum of 5 lire equivalent to $0.209 to $0.322 per box, on an average basis of three boxes per 1,000 lemons. Dr. Cheney (Daily Consular and Trade Reports, Oct. 31, 1908), quoting from one of the highest authorities, gives a total cultural cost of $92.84 per hectare of 400 trees, or $37.60 per acre of 162 trees. The average production was 800 lemons per tree, or 360 boxes per acre, making a cost of production of $0.104 per box. SUMMARY OF COST OF PRODUCING LEMONS IN GROVES OF ITALY. From the foregoing data it appears that the variations in the cost of producing lemons in Italy per acre may be as follows: TABLE XXII.-Variations in the cost of producing lemons in Italy. The cultural costs on the better groves appear to vary from $65 to $100 per acre, and the yields from 250 to 350 boxes per acre, making the cost per box vary from $0.186 to $0.400 per box. In the Alcantara Valley the cost varied from $0.15 to $0.208 per box; in the Province of Messina, according to the International Institute of Agriculture, from $0.194 to $0.222 per box; in Palermo, Messina, Syracuse, and Catania, according to the Italian minister of agriculture, from $0.209 to $0.322 per box. According to Dr. Cheney, the cost per box, based on one of the highest authorities, is $0.104, and according to Marasa (loc. cit.), whose statement was prepared at the request of the importers of lemons in New York to be used in the effort to reduce the duty on lemons, $0.414 without taxes and $0.457 with taxes. The average cost of the cultural expenses, including taxes, would probably not exceed $0.30 per box, while it might reach 40 to 45 cents per box as a maximum cost. This means that it costs on the average $90 per acre to produce 300 boxes of lemons, which the foregoing data show to be conservatively stated. COST OF HANDLING ITALIAN LEMONS. The lemon crop is picked by the growers, by the broker, or by the exporter who purchases the fruit through the broker. The winter crop is harvested from November to June and the Verdelli crop in the summer. A grove is harvested on the average four times during a season. The picking is done by men or women, by breaking off the stems of the fruit. The fruit is then carried to a shed in the orchard by men or boys, where the stems are cut close by women, men, or boys. The lemons are then superficially graded, usually by women, the by-product fruit being removed and taken to the factory, the better fruit going into two grades and two sizes. If it has to be hauled some distance to the packing-house of the buyer, the lemons are wrapped in paper and are packed in boxes, otherwise they are packed unwrapped. The fruit wrappers are used again on low grade fruit shipped to Italian or other European countries. The fruit is then hauled in carts to the packing-house of the exporter, where it is regraded and packed for export. During the haul it is estimated by the packers that 10 per cent of the fruit may be bruised. This fruit is not lost but is shipped to nearby points or is converted into by-products. PARAGRAPH 277-LEMONS. Cost of picking. There is not a wide variation in the cost of picking, stemming, or packing the fruit in a preliminary way in the orchards. A man or woman will pick about 5,000 to 7,000 lemons per day for export, or the equivalent of 15 to 20 packed boxes. He may pick 8,000 to 10,000 for by-products. In a grove in the Palermo district, where the operations were studied as representative of the district, the following labor picked, stemmed, graded, and packed on the average 40 boxes daily. TABLE XXIII.-The cost of handling lemons in a grove in Palermo. 2 pickers at 3 lire per day (who also carried the fruit to the packing house after stemming). 1 stemmer at 3 lire per day.. 2 boys to carry baskets to stemmer and help stem the fruit at 14 lire per day.. 2 women to grade and wrap fruit at 14 lire per day....... 2 men to pack and nail boxes at 4 lire per day.. 1 boy helper in packing house at 24 lire per day Total..... Lire. 6.00 3.00 3.00 3.00 8.00 2.50 The cost per box in this grove was 12.3 cents; 5.8 cents for picking, stemming, and delivering to packing house and 6.5 cents for the grading, wrapping, and placing in the box. A large proportion of the fruit that is delivered to the packing house is unwrapped. In the groves on the level land the costs of picking, sorting, packing, is often cut down 2 cents a box. In groves where the conditions of labor are still more difficult the cost may be raised a cent or two per box above the figures given. Marasa (loc. cit.) gives the total cost of picking, stemming, and storing at 11 cents, and the sorting, wrapping, and placing in the box at 5 cents, a total of 16 cents. In many of the groves the fruit is packed under the trees and there is no delivery of the fruit to the grove packing houses. Wages paid in picking fruit.—A prominent business man and lemon grower furnished the following data showing the wages paid to the different people concerned in the picking of the fruit in the Palermo district, in May, 1911: TABLE XXIV.-Wages paid in picking lemons in Palermo. Carters to haul the fruit to Palermo, 3 lire per load of 20 boxes, or 2.9 cents per box for distances from 7 to 19 kilometers (4.35 to 11.8 miles). Cost of hauling fruit to packing house-The cost of hauling the fruit to the packing house in Palermo varies with the distance and the method of transporting. In a few groves located in the foot hills in the Monreale district, the lemons are packed out to the wagon road on mule back at a cost of about 3 cents per box per mile. The average haul will not equal a mile and only a small proportion of the crop is handled in this manner. According to data furnished by Mr. de Soto, the cost of hauling by cart to Palermo, a distance of 5 kilometers (3.10 miles) varies from 3 to 4 cents per box; 10 kilometers (6.21 miles) 5 to 6.75 cents. On trips of this distance a cart is loaded with 20 to 24 boxes. From Carini to Palermo, a distance of 16 to 18 miles, the cost is about 13 cents per box; from Bagheria about 11 miles distant, 6 to 8 cents per box; from Montelepre, 11 to 12 miles distant, 9 to 10 cents per box. On the long trips a cart is loaded with 12 to 16 boxes. The cost of delivery by cart to I alermo varies from 3 to 13 cents per box, with a possible average of 6 to 8 cents pe box. The carload rate from Santa Christine Gela on the Messina line to Palermo i 80 lire ($15.44) per car of 10,000 to 11,000 kilos (22,046 to 24,251 pounds). PARAGRAPH 277-LEMONS. A box of lemons in Italy is estimated at 42 kilos (92.6 pounds), making the rate per box 5.9 to 6.5 cents per box. The cost of unloading the car in Palermo varies from 2 to 3 lire (38.6 to 57.9 cents), or at the rate of about one-sixth of a cent per box. The cost of hauling from the car to the packing house in Palermo varies from eight-tenths to 1 cent per box, making a total cost of delivery of about 6.8 to 7.6 cents per box. The cost of delivering the fruit to the packing house varies from 3 to 13 cents where the fruit is hauled out of the grove on muleback, making an average cost of 6 to 8 cents per box. Packing of fruit for export-The final packing of the fruit is done in the packing houses of the exporters in Palermo, or other ports of export. The packing houses are located in the business part of the cities near the water front. The house is frequently the ground floor of a dwelling; or the box making and repairing, the receiving and shipping rooms, and the packing room may occupy the entire structure. There is little equipment in an Italian packing house. All the labor is performed by hand and from one-half to three-fourths of the labor is performed by women and children. The only equipment of note is the rows of benches into which the fruit is graded and the baskets used in grading and carrying the fruit in the packing house. The packing operation consists in unpacking the fruit as it comes from the groves, regrading, wrapping, packing the lemons into boxes and nailing on the covers and hoops. The packed boxes are then carted to the wharf, lightered in small boats to the steamer which is anchored a short distance away, and are loaded in the vessel that carries them to their destination. In the packing operations, the labor is usually divided into crews, consisting of one foreman, one woman sorter, three women wrappers, one boy to hand the fruit to one man packer, and one nailer to every four packers. In one large house where the operations were studied in detail, the wages paid in May, 1911, were: Women, 1 lire each; boys, 2 lire; packers, 4 lire; nailer, 3 lire; and foreman, 4 lire per day. The wages paid to the different kinds of packing-house labor in Palermo, 1911, is as follows: TABLE XXV.-Wages paid in a packing house in Palermo. The working hours are from 7 a. m. to 11 a. m. and from 12 noon to 5 p. m. Cost of packing fruit for export.-During 1911, the exporters in Palermo were invoicing the costs of the packing operations about as follows: Empty boxes of American sides, tops and bottoms, 80 centimes (15.4 cents); foreign grown boxes 85 centimes (16.4 cents); the cost of packing which includes labor of all kinds, nails, paper, tinsel, etc., from 50 to 60 centimes (9.65 to 11.58 cents), the usual invoice being about 55 centimes (10.6 cents); the transportation from the packing-house to the lighter from 0.25 to 0.45 lire (4.8 to 8.7 cents) and the cost of lightering from 0.04 to 0.32 lire (8 mills to 6.2 cents) the usual lighterage charge being 0.10 lire (1.9 cents). According to the invoices of the exporters, the average cost of the packing-house expenses from the time the fruit reaches the packing house till it is placed on the steamer is about 35 cents per box. Some of the exporters add insurance to the invoice amounting to about 0.5 centimes (9.6 mills). There is a charge also of 13 lire per invoice ($2.51) made by the consular agency, which adds from a small fraction of a cent to a cent and a half or more per box. Including the consular invoice, the insurance and the packing and transportation to the steamer, the cost per box varies from 36 to 42 cents per box, with an occasional higher cost for fruit handled under unusual conditions. TOTAL COST OF PRODUCING AND HANDLING LEMONS IN ITALY. From the foregoing data it will be seen that the costs of producing lemons in Italy may vary approximately as follows: PARAGRAPH 277-LEMONS. TABLE XXVI.-The average cost of producing lemons in Italy. Based on the cost of production, the f. o. b. value of a box of Italian lemons is approximately $0.91. There is no way in which the cost of producing the higher grades that are exported to foreign countries can be separated from the average cost given above because all grades are produced simultaneously on the same trees, and for at least 80 per cent of the crop all grades are purchased from the producer at the same price. The exporters place an f. o. b. value on the fruit exported, though this value bears no relation to the cost of production and may bear no relation to the cost of the fruit to the exporter, except in such cases where he purchases only the higher grades for export. The values of the fruit exported from Italy from 1897 to 1908 as given by the Italian Government varies from $0.515 to $0.772 per box for the fruit to which $0.39 per box should be added for packing charges and loading on the steamer. The f. o. b. value, i. e., the price which the exporter is willing to receive, as given by the exporters on their invoices has varied from 1903 to 1911, from a maximum of $2.11 per box in 1907 to a minimum of $1.38 per box in 1910 (page 23) the year following the passage of the Payne-Aldrich Act. The duty that the exporter would have to pay if all the fruit arrived in sound condition based on the average weight of 72.9 pounds per box is $1.09, but the refunds for decay during 1909 and 1910 were approximately 10 per cent of 'he duty paid, making an actual duty paid of approximately $1 per box. The duty paid on the boxes has not averaged over 4 cents during the last 10 years. The costs that are chargeable against a box of Italian lemons after arrival in New York, including the selling charges, are approximately as follows: TABLE XXVII.—The charges against a box of imported lemons on arrival in New York. Wharfage, after fifth day, one-third cent per box. Importers are required to deposit 2 cents Marine fire insurance generally covers original cost of fruit f. o. b. Sicily, freight, duty, and Banking commission-One per cent on cost of fruit f. o. b. port of export; equals about. Labor on dock, covering lining up of fruit, opening up of samples for lot, fixed charge per box.. Rebate 2d. on all lots for tariff fund.. Rebate 3d. in addition all lots of 1,000 boxes or over. $1.095 .04 .003 .0075 .016 0.075-.08 .02 .344 .04 .06 ADDITIONAL BRIEF ON LEMON SCHEdule. The Citrus Protective League herewith offers a reply to certain erroneous statements and conclusions contained in the brief of the Italian Chamber of Commerce of New York, not heretofore having had opportunity to do so: Cost of production in Italy.-Attention is called to pages 5 and 6 of the brief of the Italian Chamber of Commerce referring to cost of production, and attention is called to the apparent errors shown on these pages. The cultural cost as stated is $96 per acre, which is $6 higher than is shown by the investigation of Mr. Powell. The production is there shown as 270 boxes per acre, which is 30 boxes less than shown by Mr. Powell, which results in a per box cost of 354 cents against 30 cents a box, shown by Mr. Powell. The picking cost is stated at 12 cents a box, which Mr. Powell does not give separately. The next item of taxes is not a cultural cost, and is not included 78959°--VOL 3-13-61 PARAGRAPH 277-LEMONS. in the California cost. The next item of superintendence-$20 an acre is not a cultural cost and is not given the California costs, and can not be correct in view of the character of the industry in Italy, which is conceded to be in the form of small gardens where the work is done by the owner. The next item under the head of returns shows $1.16 per box. This is not a cultural cost, but the price at which the product is sold, which includes profits. By turning to page 6 it will be observed that instead of carrying the actual cost of 35 per box the selling price of $1.16 per box is assumed as the cost of production. The items of handling the fruit from the orchard to the ship is stated as first, grading at grove, 5 cents; cartage froin grove to warehouse, 8 cents; repacking at ship port, 45 cents; which makes a total cost of handling from orchard to ship of 70 cents per box as against the figure of 61 cents shown by Mr. Powell's investigation, or a total cost of production and handling to the ship of $1.054 against Mr. Powell's figures of 91 cents. The further items given on page 6 of loss of culls in grading is manifestly incorrect, as the culls are used in by-products, and are not lost. The further items in this tabulation refer to cost in transit and in New York, which are not properly items of production cost. According to these figures when correctly stated, showing cost of a box of lemons in Sicilian ports to be $1.054 as against the cost in California of $1.88%, or a difference in cost of 73 cents per box, which equals approximately 1 cent a pound. The cost to the importer is evidently an improper method of comparison in fixing a tariff, for such price includes the profits to the grower and middleman in Sicily not based upon free competition but on an arbitrary price fixed by overnmental monopoly. To assume such a basis gives the foreign importers complete power to destroy a domestic industry and fix an arbitrary price to the American consumer. Second. Reference has been made to the recent disastrous freeze in California as a reason why the duty should be reduced. This is said by the weather observers to be the first general freeze during a period of 60 years, and therefore can not be taken to be a valid reason why the California climatic conditions are unsuited to a development of the industry. The effect of the freeze will undoubtedly be to discourage the producers, and it would not seem to be good policy to further add to their discouragement. The effect of the California product in securing reasonable prices to the consumer is reflected in the markets following this freeze, and shows what the price of lemons would be if it were not for the California production. To show the effect this freeze has on lemon prices, we call the attention of the committee to the Fruitman's Guide, January 18, page 4, wherein it is said: "The big surprise of the week was shown at the Sicily lemon auction on Tuesday. All previous winter lemon-price records were smashed. This was due in large measure to the certainty that California lemons will cut no figure in the campaign this year. Not even the oldest broker in the business can recall a time when lemons sold so high as recorded this week in the month of January. Everything was taken greedily. The market opened about $1.50 a box higher than the last sale and climbed swiftly and steadily. The average advance over the last sale was more than $2 a box. In some instances identical brands showed a rise of more than $2.50 a box. * Third. It was erroneously stated by a member of this committee that the wages paid for picking California lemons was in some instances as low as $1.25 per day. The member was doubtless misinformed while in California, or his informant neglected to state that this wage included board, for there are no wages in the citrus industry as low as $1.25 per day. Most women and girls in packing houses receive from $2 to $3 per day, and thousands of women are making a good living amidst clean and pleasant surroundings and light work who would otherwise have difficulty in maintaining themselves, while the lowest wage paid field labor in California is $1.75 per day. The minimum wages paid to white labor is $2 a day, and from that to $2.50 a day, and we beg to submit the following affidavit from growers who are fully acquainted with the situation. A. F. CALL. CITY OF WASHINGTON, District of Columbia, ss: C. C. TEAGUE. A. F. Call, C. C. Teague, H. B. Chase, being duly sworn, depose any say, and each for himself says that he is a grower and shipper of lemons from California and is a large employer of labor and is thoroughly familiar with labor conditions throughout the citrus belt of California; that the lowest wage paid to field labor, including picking, is $1.75 per day; that the ordinary wage paid to American white labor is from $2 to $2.50 per day. That Oriental and Mexican labor commands a less price than white labor; |