Economic Information

Report 52

Estimated

Costs

of Processing,

Warehousing and Selling

Florida Citrus Products, 1974-75

r' / f '/**
*' /*' ''*,*,* '-

July 1976

Food and Resource Economics Department
Agricultural Experiment Stations
Institute of Food and Agricultural Sciences
University of Florida, Gainesville 32611

Daniel S. Tilley

ABSTRACT

The costs of processing, warehousing and selling Florida
citrus products for the 1974-75 season are estimated to have in-
creased substantially over 1973-74 levels. The estimated total
cost of producing 48 6-ounce cans of orange concentrate has in-
creased to $3.42--a 14 percent increase above 1973-74 levels
while the costs of producing single strength orange juice in 12
46-ounce cans are estimated to have increased to $2.91--a 21 per-
cent increase over 1973-74 levels. Processing costs have risen
relative to the retail price of the products.

Key words: citrus marketing, citrus processing, marketing
margins, processing costs, citrus.

TABLE OF CONTENTS

. 1

SUIM ARY . . .. ..

INTRODUCTION ... . ..

FROZEN CONCENTRATE .. .. .....

SINGLE STRENGTH JUICES AND GRAPEFRUIT SECTIONS

. . . 3

CITRUS FEED .. ... . . . 9

COST AND PRICE :i.i;iL.; .. .... . . 15

REFERENCES .. . . . . 20

LIST OF TABLES

Table

1 Volume of citrus products produced by sample firms
relative to the total volume produced in Florida, 1974-75
season . . *

2 Estimated costs of processing, warehousing and selling
Florida 01ii:' concentrate, 45 brix, 48 6-ounce cans in
cases, 1974-75 season with comparisons to 1973-74 season
levels . . *

3 Estimated costs of processing, warehousing and selling
Florida frozen concentrate in cases, 450 brix, nine firms,
1974-75 season . *

4 Estimated costs of processing, warehousing and selling
Florida frozen concentrate in cases, 450 brix, 1974-75
season . . . * *

5 Estimated costs per gallon for processing, warehousing
and selling Florida frozen concentrate, 45 brix, 1974-75
season. ... . . * *

. .. ... .

LIST OF TABLES (Continued)

Table Page

6 Estimated costs per gallon for processing, warehousing
and selling Florida frozen concentrate, 58 brix, 1974-75
season .. . . . .. 8

7 Estimated costs of processing, warehousing and selling
12 46-ounce cans of single strength Florida orange juice
in cases, 1974-75 season with comparisons to 1973-74
levels . . . . . . 10

8 Estimated costs of processing, warehousing and selling
Florida citrus fruit juices, 1974-75 season . ... 11

9 Estimated costs of processing, warehousing and selling
Florida citrus fruit juices, 1974-75 season ..... ... 12

10 Estimated costs of processing, warehousing and selling
Florida canned grapefruit sections and chilled orange
juice, 1974-75 season . .. . 13

11 Estimated costs of processing, warehousing and selling
Florida citrus feed, in bulk, 1974-75 season with com-
parisons to 1973--74 . . . . . 14

12 Total cost for processing, warehousing and selling
Florida frozen, 450 brix, orange concentrate, 1965-66
through 1974-75 seasons . . 16

13 The relative changes in the component costs that make up
the total cost of processing, warehousing and selling
48/6-ounce orange concentrate, 1965-66 through 1974-75
seasons .......... . 17

14 Estimated average costs of processing, warehousing and
selling canned Florida citrus juices, excluding sugar,
in 12 46-ounce cases, 1961-62 through 1974-75 seasons 18

15 Estimated average costs of processing, warehousing and
selling Florida canned sections and chilled products,
1961-62 through 1974-75 seasons .. .. .... 19

ESTIMATED COSTS OF PROCESSING, WAREHOUSING AND
SELLING FLORIDA CITRUS PRODUCTS, 1974-75 SEASON

D. S. Tilley

SUMMARY

The costs of processing, warehousing and selling Florida citrus
products for the 1974-75 season are estimated to have increased sub-
stantially over 1973-74 levels. The estimated total cost of producing
48 six-ounce cans of orange concentrate has increased to $3.42--a 14
percent increase above 1973-74 levels while the costs of producing
single strength orange juice in 12 46-ounce cans are estimated to have
increased to $2.91--a 21 percent increase over 1973-74 levels. Pro-
cessing costs have risen relative to the retail price of the products.

INTRODUCTION

The purpose of this study is to develop estimates of processing
costs for Florida citrus products for the 1974-75 season. Citrus pro-
cessing cost data were obtained from 13 firms. The total volume for
each type of product and the percentage of total Florida production
processed by firms in the sample are shown in Table 1. The sample firms
represent a larger share of concentrate and canned product production
than of chilled product production.
Most firms provided average unit costs from their audited financial
statements. The following summaries present estimates of the average
costs for plant operation, warehousing and selling the finished products.
Fruit costs are not shown. The numbers shown in the following tables
are weighted averages where the weights are the volumes packed of each

D. S. TILLEY is assistant professor of Food and Resource Economics.

Table 1.--Volume of citrus products
the total volume produced

produced by sample firms relative to
in Florida, 1974-75 season.

Total
produced
by sample
firms

Total
produced
in
Florida

- -- Equivalent units -

Percentage
of total
Florida
production
produced by
sample
firms

Percent

Orange concentrate
(gallons)

Grapefruit concentrate
(gallons)
Canned single strength
orange juice
(24/2 equivalent)

Canned single strength
grapefruit juice
(24/2 equivalent)
Canned blended single
strength juice
(24/2 equivalent)
Canned grapefruit
sections
(gallons)
Chilled orange juice
(gallons)
Chilled grapefruit
juice
(gallons)

Chilled grapefruit
sections
(gallons)

Chilled citrus salad
(gallons)

71,245,886

2,516,127

6,804,226

11,323,993

1,033,457

770,497

2,829,668

1,076,856

182,722

575,956

178,174,349

7,847,300

10,737,339

15,950,872

1,493,382

2,235,641

123,189,316

15,140,153

1,633,817

3.465,394

aReported by the Florida Canners'

Product

Samp 1 e
firmsa
producing
each
product

:~-f----------------- --I

---------~- -----I---------------~-------^-------

___~_~_~_~__~_~,~,~~~-~_-_------------- u^--_-

Association [1].

-3-

product by each firm. Weighted averages tend to place the numbers
reported in the tables closer to the costs for those firms with the
larger volume of each of the products.
The firms were not selected according to a sample design. 3ome of
the year-to-year cost variation can be attributed to variation in the
firms in the sample and the distribution of the total volume of each
product among sample firms.
Detailed costs were collected into several major cost categories
for each product and can size to give a total cost unsweetened.
Selling costs include brokerage as well as the firms' sales depart-
ment expense. Discount allowances and brand royalties have been omitted.

FROZEN CONCENTRATE

The estimated costs of processing, warehousing and selling orange,
grapefruit and blended frozen concentrate in various retail and bulk
forms are shown in Tables 2, 3, 4, 5 and 6.
Estimated average costs for packing 48 six-ounce cans of orange
concentrate in cases are shown in Table 2 along with item-by-item com-
parisons to 1973-74 estimates. Total costs were estimated at $3.42 per
case--a 14 percent increase above 1973-74 estimates. Although several
smaller items showed larger percentage increases, materials (primarily
cans) showed the largest increase--up 32 cents. Labor costs decreased
five percent. Selling costs and other processing expenses showed 22
and five percent increases respectively.
Tables 3, 4, 5 and 6 show costs of packing other retail and insti-
tutional packages as well as bulk concentrate in drums.
The changes in costs for the other retail packs are similar to
those shown for the 48 six-ounce cans in cases. The magnitude of the
can cost increase for the case of 48 six-ounce cans is greater than the
increase in can cost for the other retail containers shown. The total
estimated costs for 24 12-ounce, 24 16-ounce and 12 32-ounce cans in
cases increased 13, 14 and nine percent over 1973-74 respectively.
Bulk 450 brix orange concentrate processing, warehousing and selling
costs shown in Table 5 were down three percent from 1973-74 estimates

-4-

Table 2.--EsLimiated costs of processing, warehousing and selling
Fior-ida orange concentrate, 45 brix, 48 6-ounce cans in
cases, 1974-75 season with comparisons to 1973-74 season
levels.

Frozen orange concentrate 48 6-oz.

Cost group Estimated cost
Change
1974-75 1973-74a in cost

Number of plants 9 9
Nmu-br of cases per plant 768,095 773,562

Cost per case Percent

Materials
Cans $1.5426 $1.2362 +25
Cartons .1070 .0879 +22
Labels .0005 -
Other .0033 .0044 -25
Total materials $1.6534 $1.3285 +24
Processing labor
Direct $0.2402 $0.2578 7
Indirect .0818 .0877 7
Payroll taxes & ins. .0434 .0410 + 6
Total processing labor $0.3654 $0.3865 5
Other processing expense .
Power, lights, water $0.1204 $0.1117 + 8
iMaintenance & repairs .1364 .1419 4
Depre cia tion .0764 .0537 +42
Royaities on machinery .0722 .0746 3
Taxes, insurance, rent .0255 -.0315 -19
Miscellaneous expense .0821 .0730 +12
Total other processing $0.5130 $0.4864 + 5
Total -ocessin expense $2.5317 $2.2014 +15
Warehousing .expense
lhse. r ship., labor & taxes $0.0834 $0.0864 3
Other warehousing expense .1406 .1066 +32
Total warehouse expense $0.2240 $0.1930 +16
Administrative expense $0.1636 $0.1521 + 8
SellJing enonse
B brokerage $0.0551 $0.0491 +12
Other selling expense .1015 .0788 +29
Total selling expense $0.1566 $0.1279 +22
Other xen- _f0 se
Advertising tax & insp. $0.2190 $0.2248 3
Other (int., misc. dedct.) .1245 .1235 + 1
Total other expense $0.3435 $0.3483 + 9
Total cost $3.4194 $3.0227 +14

aFrom Tilley [2].

In this and the following tables administrative expenses include
management and office salaries, office expense, telephone and telegraph,
and travel.

In this and the following tables selling expense excludes allow-
ances, discounts, and brand royalties.

-5-

Table 3.--Etimated costs of processing, warehousing and selling
Florida frozen concentrate in cases, 450 brix, nine firms,
1974-75 season.

Item Orange concentrate

Container size 24/12 12/32

Number of plants 9 9
Number of eases per plant 884,230 156,384
Cost per case -

Materials
Cans
Cartons
Labels
Other
Total materials
Processing labor
Direct
Indirect
Payroll taxes & ins.
Total processing labor
Other processing epense
-ower, lights, water
Maintenance & repairs
Depreciation
Royalties on machinery
Taxes, insurance, rent
Mis ce1 ane ous
Total other processing expense
Total processing expense
Warehouse expense
Whse. & shipping, labor & taxes
Other warehouse expense
Total warehouse expense
Adtinnistrative expense_
Selling expense
Brokerage
Other selling expense
STotal selling expense
Other expense
Advertising tax & insp.
Other (int., misc. dEductions)
Total other expense
Total cost

$1.0540
.1046
.0006
.0045
$1. 1637

$0.2449
.0872
.0465
$0. 3786

$0.1258
.1344
.0814
.0730
.0243
.0835
$0.5224
$2.0647

$0.0844
.1484
$0.2328
$0.1250

$0.0542
.1008
$0.1550

$0.2226
.1460
$0.3686
$2.9461

$0.8286
.1315
.0008
.0046
$0.9655

$0.3172
.1121
.0598
$0.4891

$0.1599
.1797
.1092
.0964
.0318
.1110
$0.6880
$2.1426

$0.1043
.1877
$0.2920
$0.2043

$0.0728
.1270
$0.1998

$0.2901
,1759
$0.4660
$3.3047

LI~)II~--~-~-ULI --- .- .-- -- --. -.-^-i ~ -L_

-6-

Table 4.--Estimated costs of processing, warehousing and selling
Florida frozen concentrate in cases, 450 brix, 1974-75
season.

Concentrate
Item
Orange Grapefruit

Container size 24/16 24/6

Number of firms 9 8
Number of cases per firm 423,267 25,687

Cost per case -

Materials
Cans $1.6320 $0.7837
Cartons .1300 .0859
Labels .0007 .0030
Other .0050 .0030
Total materials $1.7677 $0.8756
Processing labor
Direct $0.3087. $0.1286
Indirect .1069 .0499
Payroll taxes & ins. .0573 .0259
Total processing labor $0.4729 $0.2044
Other processing expense
Power, lights, water $0.1606 $0.0680
Maintenance & repair .1739 .0595
Depreciation .0933 .0305
Royalties on machinery .0949 .0439
Taxes, insurance & rent .0334 .0120
Miscellaneous expense .1062 .0462
Total other processing expense $0.6623 $0.2601
Total Irocessing expense $2.9029 $1.3401
Warehouse expense
Warehouse & shipping, labor & taxes $0.1088 $0.0564
Other warehouse expense .1709 .0793
Total warehouse expense $0.2797 $0.1357
Administrative expense $0.2401 $0.1242
Selling xpense
Brokerage $0.0731 $0.0394
.Other selling expense .1275 .0409
Total selling expense $0.2006 $0.0803
Other expense
Advertising tax & insp. $0.2875 $0.1307
Other (int., misc. deductions) .1516 .0462
Total other expense $0.4391 $0.1769

-- "~

Total cost

$4.0624

$1.8572

Table 5.--Estimated costs per gallon for processing, warehousing and
selling Florida frozen concentrate, 45 brix, 1974-75 season.

Concentrate
Item Gallons, 450 Equigalent gallon
in drums 45 all packs

Number of firms 7 9
Number of gallons per firm 1,235,490 7,154,872
Cost per gallon -

Materials
Drums and liners (total) $0.0201 $0.0000
Processing labor
Direct $0.0982 $0.1050
Indirect .0443 .0380
Payroll taxes, insurance .0233 .0203
Total processing labor $0.1658 $0.1633
Other processing expense
Power, lights, water $0.0655 $0.0564
Maintenance & repair .0548 .0590
Depreciation .0315 .0331
Royalties on machinery .0339 .0327
Taxes, insurance & rent .0075 .0105
Miscellaneous expense .0401 .0373
Total other processing $0.2333 $0.2290
Total processing expense $0.4192 $0.3923
Warehouse expense
Whse. & shipping, labor & taxes $0.0398 $0.0375
Other warehouse expense .0568 .0604
Total warehouse expense $0.0966 $0.0979
Administrative expense $0.0425 $0.0673
Selling pense
Brokerage $0.0227 $0.0247
Other selling expense .0245 .0408
Total selling expense $0.0472 $0.0655
Other expense
Advertising tax & inspection $0.0986 $0.0976
Other (int., misc. deduction) .0688 .0756
Total other expense $0 1674 $0.1732
Total costs $0.7729 $0.7962

-8-

Table 6.---Estimated costs per gallon for processing, warehousing and
selling Florida frozen concentrate, 58 brix, 1974-75 season.

Concentrate

Item Orange Grapefruit

Gallon, 580 Gallon, 58
in drums in drums

Number of firms 3 4
Number of gallons per firm 960,857 162,475

Cost per al on -

Materials
Drums and liners (total) $0.0333 $0.0966
Processing labor
Direct $0.0945 $0.1640
Indirect .0294 .0300
Payroll taxes, insurance .0142 .0065
Total processing labor $0.1381 $0.2005
Other processing expense
Power, lights, water $0.0427 $0.0892
Maintenance & repair .0496 .0428
Depreciation .0237 .0984
Royalties on machinery .0301 .0497
Taxes, insurance & rent .0113 .0108
Miscellaneous expense _0272 .0470
Total other processing $0.1845 $0.3379
Total procePssti 9_i~e-nspe $0.3559 $0.6350
Warehouse exuiense
Whse. & shipping, labor & taxes $0.0357 $0.0480
Other warehouse expense .04 42 .0432
Total warehouse expense $0.0797 $0.0912
Administrative expense $0.1131 $0.1355
SellingL expense
Brokerage $0.0277 $0,0080
Other selling expense .0445 .2011
Total selling expense $0.0722 $0.2091
Other expense
Advertising tax & inspection $0.1241 $0.1535
Other (int., misc. deductions) .0119 .0170
Total other expense $0.1360 $0.1705

Il-----~lll-CI-~~""Il~----U---------- --- I~------

$0.7570

$1.0529

Total cost

while the cost for equivalent gallons for all packs (excluding materials)
is estimated to have increased seven percent over 1973-74 levels.
The costs of processing 580 brix bulk orange and grapefruit concen-
trate are shown in Table 6. It should be noted that only three fimns
reported costs for these products and that estimates are subject to
great variability.

SINGLE STRENGTH JUICES AND GRAPEFRUIT SECTIONS

Estimated average single strength processing, warehousing and
selling costs are shown in Tables 7, 8, 9 and 10.
Table 7 shows estimated single strength processing costs for 12
46-ounce cans in cases for 1974-75 with comparisons to 1973-74 estimates.
Cans were the item showing the largest absolute increases while selling
expenses were the items with the greatest percentage increases. Total
estimated costs rose by 21 percent relative to 1973-74 estimates.
Tables 8 and 9 show estimated costs for other retail packages of
orange, grapefruit and blended juices. Table 10 reports the weighted
average cost of producing canned grapefruit sections and chilled orange
juice for the three sample firms producing those products. The costs
are shown only for general information and are not felt to be reliable
estimates of the industry average cost because of the small sample size
and low volumes of the sample firms.

CITRUS FEED

The estimated costs of processing citrus feed in bulk are shown in
Table 11.
Citrus feed processing costs are estimated to have increased from
almost $36 to almost $38 per ton. Nearly all of the $2 increase can be
attributed to increased utility costs (power, water, lights, steam).
Most of the remaining increases were in other processing costs and
selling expenses.

-10-

Table 7.--Estimated costs of processing, warehousing and selling 12 46-
ounce cans of single strength Florida orange juice in cases,
1974-75 season with comparisons to 1973-74 levels.

Orange juice 12 46-oz.
(excluding sugar)
Cost group
Cost g p Season
Change
1974-75 1973-74 in cost

Number of plants 6 7
Average number of cases per plant 639,584 436,998

Cost per case Percent
Materials
Cans $1.6093 $1.1855 +36
Cartons .1530 .1188 +29
Labels and other .0782 .0669 6
Total materials $1.8405 $1.3712 +34
Processing labor
Direct $0.1297 $0.1280 + 1
Indirect .0628 .0463 +36
Payroll taxes & ins. .0296 .0233 +27
Total processing labor $0.2221 $0.1976 +12
Other processing expense
Power, lights, water $0.0631 $0.0480 +31
Maintenance & repairs .0648 .0539 +20
Depreciation .0407 .0318 +28
Royalties on machinery .0326 .0301 + 8
Taxes, insurance, rent .0128 .0156 -17
Miscellaneous expense .0454 .0401 +13
Total other processing $0.2594 $0.2195 +18
Total processing expense $2.3220 $1.7882 +30
Warehouse expense
Whse. & ship., labor & taxes $0.1303 $0.1414 8
Other warehouse expense .1085 .0979 +11
Total warehouse expense $0.2388 $0.2393 0
Administrative exense $0.1076 $0.1480 -27
Selling expense
Brokerage $0.0566 $0.0399 +42
Other selling expense .0315 .0255 +24
Total selling expense $0.0881 $0.0654 +35
Other expense
Advertising tax & insp. $0.1007 $0.0995 + 1
Other (int., misc. dedct.) .0484 .0554 -13
Total other expense $0.1491 $0.1549 + 4
Total cost unsweetened $2.9056 $2.3958 +21

-11-

Table 8.--Estimated costs of processing, warehousing and selling
Florida citrus fruit juices, 1974-75 season.

SBlended
Orange juice
j juice

Container size 48/6 24/2 24/2

Number of plants 6 5 4
Number of cases per plant 247,521 76,551 15,968

- Cost per case -

Materials
Cans $2.0363 $1.7534 $1.9799
Cartons .1087 .1314 .1448
Labels -- .0735 .0631
Other .0026 .0414 .0998
Total materials $2.1476 $1.9997 $2.2876
Processing labor
Direct $0.0875 $0.2365 $0.4157
Indirect .0441 .0994 .1488
Payroll taxes & ins. .0206 .0472 .0771
Total processing labor $0.1522 $0.3831 $0.6416
Other processing expense
Power, lights, water $0.0415 $0.0698 $0.0679
Maintenance & repairs .0364 .0606 .0861
Depreciation .0278 .0444 .0458
Royalties on machinery .0199 .0335 .0382
Taxes, insurance, rent .0082 .0160 .0207
Miscellaneous expense .0249 .0420 .0586
Total other processing $0.1587 $0.2663 $0.3173
Total processing expense $2.4585 $2.6491 $3.2465
Warehouse expense
Whse. & shipping, labor & taxes $0.1054 $0.1314 $0.1339
Other warehouse expense .0974 .1120 .0944
Total warehouse expense $0.2028 $0.2434 $0.2283
Administrative expense $0.0512 $0.0862 $0.1285

Selling expense
Brokerage $0.0548 $0.0433 $0.0201
Other selling expense .0294 .0236 .0123
Total selling expense $0.0842 $0.0669 $0.0324
Other expense
Advertising tax & insp. $0.0536 $0.0788 $0.0823
Other (int., misc. deductions) .0348 .0346 .0085
Total other expense $0.0884 $0.1134 $0.0908

$2.8851

$3.1590 $3.7265

Total cost unsweetened

Table 9.-;tinat, i o::;tsi of proc:ssin. iwarehousi.ng and selling Floria
cj lon truit juicos, 1974-65 season,

' ended
uii '',ce

Grapefruit j9a c

Container s:i '

Number of ipan -,s
Number of cases per p:iat

Materials
Cans
Cartons.
( a.r. t Ore )
Labe ls
Other
Total materi al.s
Process i-C. i' .alba
Direct
Indirect
Payroll ta.e:. & E.-,
Total proccasinr labor
Other Ion- _ss 'n .. .eas.
Power, lih.- wter.
Maintenance & r", ;._
Depreci at.io-n
d 7ties on Ma ph a C
Taxes, is urnic a ri:
Mise 1 iaeous
Total othL er ...... 'ri
Total procesy:;'-^'''y, ".p
Warehouse epen-,:-:.
Whse. & s _hippi..n_: .l.:ii bo'i
Other warehouse ox 4 -,4
Total 'war!eho-';s e- e pnle
Admi nistrative .:-.
Selling exgriae
8 rokerage
Other selling exspeu:
TotSl se iil xc:A c

Other exprens&3
Advertisng : ta;x A Li.p
Other (irL. mT:i. -CiduKtions)
Total co er : :;ense
Total cost munnv esnwe t:-;.:: '

12/46 48/6 t24/2 11/6

3 6 5 6
13553 287,,759 63,219 1,109,986

... Cost per case - -

1. 643l
,. i"_ / 9

.0059
'1 '039

.0563
0: 3

"^O' 'm8

$0.061(4

.0406
.. 0275
.0132

'. 70
MEL', <

$2.0343

.0000
,001 S
$2.. 30

$0 077n
.0391
.0189

$0.0383
.0362

.0167
.00/8
.0246
$-0.501

$1.i ,6977
.1351
.0 751
.0253
4$13332

.0775

$0.2 973

,0287
.0 134
,0403
OU .Z7

$1.6 .12
., 1529
,0 782
201
.0049
'$1%8672

0. 1151
.0515
,0254.
$0.1920

$0.0533
.0638
.0358
.0259
.0119
.0429
$0.2336

.2 '3137 /$2 '2:9 $2 4' $2.2928

Taxes

O1. 1262
X0999
? ."2261

$0.09 .
.09893
$01900,

$0..i259
.104c8
'$0.2307

$0.1287
.1006
$0.2293

'0, ', $0.0473 $0.0836 $0. 1.134

$0,0452
.0263

$cl. 1080
1.528
00. .608

$0 ,0513
.0292
$0.0 O 5

$0.05 85
.0358

$0.0474
.0262
$0'. 0736

$0.0882
.0358
io0.1240

$0.0491
.0285
$0.0776

$0 1131
.0429
$0.1560

$2,8717 $2. 415 $2,9897 $2.8691

-13-

Table 10. --Estimated costs of processing, warehousing and selling
Florida canned grapefruit sections and chilled orange juice,
1974-75 season.

Iem Grapefruit Chiller orange
sections j-

Container size 24/303 6/54 oz,

Number of plants 2 3
Number of cases per plant 314,517 723,894

Cost er case -

Materials
Cans $1.3611 $1.1603
Cartons .1294 .0032
Labels .0461 .0154
Other .0254 .0076
Total materials $1.5620 $1.1855
Processing labor
Peeling $0.1243 $ --
Sectionizing .7009
Other direct .7279 .1512
Indirect labor .2339 .0537
Payroll taxes, ins, .2819 .0307
Total processing labor $2.0689 $0.2356
Other processing epgense
Pcwer, lights, water $0.2642 $0.0755
Maintenance & repairs .1379 .0492
Depreciation .1094 .0403
Royalt:ie on machinery .4405 .0244
Taxes, insurance, rent .0598 .0112
Mis cell aneous .0843 .0325
Total other processing $1.0961 $0.2331
Total orecessing expense $4.7270 $ 16552
Warehouse expense
-a. S shipping, labor & taxes $0.1331 $0.1026
Other warehouse expense .1251 .1147
Total warehouse expense $0.2582 $0.2173
Adminil -L.atle tpesce $0.0537 $0.0637
Sell ing expren se
B brokerage $0.0832 $0.0532
Other selling expense .0369 .0283
Total selling expense $0.1201 $0.0815
Other expense
Advertising tax & insp. $0.0881 $0.0740
Other (int misc. deductions) .1334 .0421
Total other expense $0.2215 $0.1161

_~1_1~I L-I~~-----_--PI--^LI--~I^-IIU

$5.3805

$2.1338

Total cost unsweetened

-14-

Table 11.--Estimated costs of processing, warehousing and selling
Florida citrus feed, in bulk, 1974-75 season with compari-
sons to 1973-74.

Season
ItemSeason Change
1974-75 1973-74a in cost

Number of plants 10 10
Number of tons produced per plant 37,172 33,093

Cost per ton Percent
Materials total $ 0.75 $ 0.79 5
Processing labor
Direct $ 3.48 $ 3.92 -11
Indirect 2.30 2.03 +13
Payroll taxes & insurance .83 .75 +11
Total processing labor $ 6.61 $ 6.70 1
Other process ing expense
Power, water, lights, steam $13.56 $11.15. +22
Maintenance & repairs 3.88 3.84 + 1
Depreciation 4.50 4.24 + 6
Taxes, insurance & rent 1.27 1.15 +10
Miscellaneous expense 1.33 1.08 +23
Total other processing expense $24.54 $21.46 +14
Total jprces8_si ~pense $31.90 $28.95 +10
Warehouse expense
Warehouse & shipping,
labor & taxes $ 1.05 $ 1.64 -36
Other warehouse expense 1.19 1.26 6
Total warehouse expense $ 2.24 $ 2.90 -23
Administrative expense $ 1.89 $ 2.36 -20
Selling expense
Brokerage $ 0.17 $ 0.13 +31
Other selling expense .59 .41 +44
Total selling expense $ 0.76 $ 0.54 +41
Other expense total $ 1.03 $ 1.07 4
Total costs $37.81 $35.82 + 6

aReported by Tilley [2].

-15-

COST AND PRICE TRENDS

Processing, warehousing and selling costs remained reasonably
stable until the 1971-72 season. As shown in Table 1.2, costs for pro-
cessing, warehousing and selling 48 six-ounce cans of concentrate in
cases were at only 107 percent of the 1965-68 average until the 1971-72
season. Since the 1971-72 season the index has risen to 155 percent of
the 1965-68 average. In the last two columns of Table 12, the actual
and relative retail prices of 48 six-ounce cans of concentrate are
shown. While 1974-75 processing costs were estimated at 155 percent
of 1965-68 levels, 1974-75 prices were at only 124 percent of 1965-68
levels.
Changes in the cost categories that make up the total processing,
warehousing and selling expenses for 48 six-ounce cans of concentrate
are shown in Table 13. Labor, other processing expenses and warehousing
expenses are the items that increased the most relative to 1965-68 levels
while materials, selling and other expenses have shown relatively small
increases.
Tables 14 and 15 show how costs of producing other products have
changed since the 1961-62 season.

-16-

Table 12.--Total cost for processing, warehousing and selling Florida
frozen, 45 brix, orange concentrate, 1965-66 through 1974-
75 seasons.

Average retail :rice
Cost per case, /
Season 8/6o a per 8/6-oz. cans
in cases

1965-66

1966-67

1967-68

1968-69

1969-70

1970-71

1971-72

1972-73

1973-74

1974-75

Actual

$2.38

2.07

2.26

2.24

2.38

2.43

2.39

2.61

3.02

3.45

Indexc

107

92

101

100

107

109

107

117

135

155

Actual

$ 8.80

7.00

8.60

9.76

8.68

8,88

9.84

9.56

9.55

10.09

Indexc

108

86

106

120

107

109

121

118

117

124

aYears prior to 1974-75 are from Tilley [2].

bReported by the Market Research Corporation of America.

CThe index was computed as a percentage of the 1965-68 average.

Table 13.--T '- relative chtanr, i. the cur;'-ent coats that make up the total cost of p:-oces.in, w'arei.housing and selling 48/6-ounce oriage concentrate,
1965-66 Lirough 1974-75 seasons.

Labor

Other
b Waroehc uing Adminitra tiv'
procesyin g

Selling

Total

'.-/rafsc ji^rcnt $/Ao'.E ForlCCn f/Ca

.2656 106 .3872 112 .123,

.2 17 G5 ,2759 .O .104s

.2729 1'9 ,2705 108 395

.2943 ilS .3I5 97 ,1278;

.28B8 115 .37,9 109 .13A :

.7666 107 .3728 !03 ,1147

.2978 !2? .4170 121 .1i35

.3865 15; .4864 14! ,.130

.3654 !46 5 130 1249 2240

.2501 100 .3443 100 ,122

100

'0.

i 10

93

171
! I

157

i12

130

S/cni;e P-r rcn'

. 4 28

.0766 68

. 1!0 104

,1203 10:

.2; i 07

.12360 23

.!623 1-3

.761 156

.2521 133

.16j3 i45

.1170 100

.093S 76

.12 ',9 i.ll

.1169 97

, 1223 99

. 5 1,' 127

.1270 103

.1389 113

.1279$ ]04

.156, 127?

. 1234 100

$/ca.je Percent

.3163 116

.282 104i

.26'1 91

.35.. 131

.2737 G1J

2i6'6 97

.2639 97

.3483 122

.3784 i39

.2717 100

7/c as Percent

2.3870 !07

2.C663 9'

2.2550 101

2.24.00 100

2.3937 1C7

2.4272 109

2.3851 107

2.6110 117

3.0227 135

3.4744 254

2.2361 100

years prior to 1974-75 are taken from Tilley 2).

Incl-ede pnow'er. wter, g .s, rtca-c, maintena ;er', repairs, r voy.ln. u:-rt une. tr~:a, at and miie 11:t o -.3o us c..ensfe.

The index for each item woas computed as a pcrc,,:nag of the 1965-68 ave r.;ge cost (shc -n in the last row cf the table)o

M[ateri,'lis

1965-66

1?.6-67

*i9 7-68

196?-69

19i3-70

l,70-71

1971-72

1972-73

1973--74

1974-75

BLsoC

.9982

10208

1,0279

1.0271

1.0771

1.1S15

1.3285

1.6534

1.0106

P recent

99

02

100

G02

102

i15

;07

131

100

-18-

Table 14.--Estimated average costs of processing, warehousing and
selling canned Florida citrus juices, excluding sugar, in
12 46-ounce cases, 1961-62 through 1974-75 seasons.

Season

Blended
juice

ise -

aData for years prior to 1974-75 are taken from Tilley [2].

1961-62

1962-63

1963-64

1964-65

1965-66

1966-67

1967-68

1968-69

1969-70

1970-71

1971-72

1972-73

1973-74

1974-75

Orange
juice

1.57

1.79

1.78

1.66

1.75

1.72

1.91

1.90

2.02

2.02

2.05

2.14

2.43

2.91

Grapefruit
juice

- Dollars per ca
1.54

1.72

1.72

1.62

1.70

1,68

1.88

1.86

1.98

2.06

2.06

2.16

2.52

2.96

1.55

1.74

1 75

1.64

1.74

1.70

1.91

1.91

2.00

2.00

2.05

2.15

2.50

2.93

Table 15.--Estiiastd average .c.sts of prcceJ-sin. uarehou.;in and selling Florida canned sections and
chilled products, 1961-62 through 1974-75 seasons.
-- -- i-- ---Ch-- `- -h ----^Ie

Canned
grapefruit
sections

12/46 24/303

Canned d
citrus
salad

12/46 24/303

Chilleci
grape frCit
sections

4/1 gal. 12/32

Cnilea
salad

4/1 gal. 12/32

S - - - Dollars jer case--

4.42
4.93
4.52

4.78
4.63
5,14
5.78
5.41
5.62
6.04
5.92
7.75
8.75

3.22
3,58
3.44
3.39
3.40
3.36
3.65
4.11
4.00
2.42
4.60
4.32
5.56
6.15

4.47
4.85
4.09
4.10
3.85
4.35
4.72
5.14
5.55
5.36
4.90
5.90'
7.16

-- 3.68

3.30
3.09
3.17
00
3.35
3.95
S4.10
4.43
3.13
5.02
5.51
5.96

5.22
5.45
5.05
5.80
6.18
6.35
6.98
6.82
6.65
7.56
8.05

3.48
3.63
4.02
4.46
4.34
4.90
5.14
5.45
6.43
6.41

aYears prior to 1974-75 are from Tilley [2].

Chill d
orztvI
juice

12/32

1961-62
1962-63
1963-64
1964-65
i965-66
1966-67
1967-68
1968-69
1969-70
1970-71
1971-72
1972-73
1973-74
1974-75

3.86
4.27
4.29
3.98
4.01
4.02
4.48
5.06
4.96
5.50
5.10
5.16
6.30
8.19

2.67
3.04
3.01
2.94
2,94
3.00
3.27
3.66
3.61
3.78
3.85
4.25
4.75
5.78

1.51
1.39
1.48
1.31
1.51
1.54
1.55
1.66
1.71
1.75
2.01
2.26

---"I~--I---~"~----sll-llL"

rl1ll --~----IIOC-l------I~.~_CI. ----II---_11I_- l~-^I1C-- ------I---II---

REFERENCES

[1] Florida Canners' Association.
Winter Haven: 1976.

Statistical Summary, 1974-475 Season.

[2] Tilley, Daniel S. Estimated Costs of Processing, Warehousing and
Selling Florida Citrus Products, 1973--74 Season. Food and
Resource Economics Department. Economic Information Report
33. Gainesville: July 1975.

-T-70

	Front Cover
	Abstract
	Table of Contents
	Main
	Reference