SEPTEMBER 1987
11\-
ECONOMICS REPORT 115
FLORIDA ORNAMENTALS:
SHIPPING ORIGINS AND
DESTINATIONS AND
CHARACTERISTICS OF
TRANSPORTATION
Central Science
Libr -r'
PPR 12 199,
Ur.rsij of
Food and Resource Economics Department
Agricultural Experiment Station
Institute of Food and Agricultural Sciences
University of Florida, Gainesville 32611
Mohammed Rahmani
Richard Beilock
J. Robert Strain
Flo/ '.i
ABSTRACT
Data for 1981 and 1984 covering virtually every truck shipment of
ornamental plants out of Florida provided the basis of this report. The
data were collected by the Florida Department of Agriculture and Consumer
Services at their agricultural inspection stations. Between 1981 and 1984,
the volume of product increased 73 percent. Foliage accounted for nearly
two-thirds of all shipments. Shipments follow distinct seasonal swings,
with April being the peak month. Approximately two-thirds of all Florida
ornamentals are delivered to states east of the Mississippi River.
Carriers were classified as occasional carriers (making less than 50 trips
a year) and specialized carriers. Carriers specializing in transportation
of ornamentals tend to use larger vehicles, have longer hauls, and make
multiple drops. Distinct weekly shipping patterns appeared with Monday
being the lightest and Saturday the highest. The level of concentration in
the ornamentals transportation industry appeared to be moderate.
Key Words: Florida ornamentals, exempt transport
ACKNOWLEDGEMENTS
This study would not have been possible without the cooperation of the
Florida Department of Agriculture. The authors recognize the helpful
comments of Leo Polopolus and Emerson Babb. The authors are responsible
for any remaining inaccuracies.
ABSTRACT
Data for 1981 and 1984 covering virtually every truck shipment of
ornamental plants out of Florida provided the basis of this report. The
data were collected by the Florida Department of Agriculture and Consumer
Services at their agricultural inspection stations. Between 1981 and 1984,
the volume of product increased 73 percent. Foliage accounted for nearly
two-thirds of all shipments. Shipments follow distinct seasonal swings,
with April being the peak month. Approximately two-thirds of all Florida
ornamentals are delivered to states east of the Mississippi River.
Carriers were classified as occasional carriers (making less than 50 trips
a year) and specialized carriers. Carriers specializing in transportation
of ornamentals tend to use larger vehicles, have longer hauls, and make
multiple drops. Distinct weekly shipping patterns appeared with Monday
being the lightest and Saturday the highest. The level of concentration in
the ornamentals transportation industry appeared to be moderate.
Key Words: Florida ornamentals, exempt transport
ACKNOWLEDGEMENTS
This study would not have been possible without the cooperation of the
Florida Department of Agriculture. The authors recognize the helpful
comments of Leo Polopolus and Emerson Babb. The authors are responsible
for any remaining inaccuracies.
TABLE OF CONTENTS
Page
ABSTRACT ................ ........ ... i
ACKNOWLEDGEMENTS . . . . . . i
LIST OF TABLES. .... . . .. . ....... i
LIST OF FIGURES. . . . . . ... iii
INTRODUCTION . . . ..... ... . 1
DATA . . . . .. . . . 3
SHIPMENT CHARACTERISTICS. .. . . . . 5
Volume and Type . . . . . 5
Seasonal Variations in Shipments. . . . . 8
Seasonal Variations by Plant Type . . . .. .10
Loading Zones Within Florida .. . . . 10
Destinations. . ..... . . .. . 13
Destination by Type of Plant. . . . .. ... 19
TRANSPORTATION CHARACTERISTICS .. . . . .. 22
Is Ornamental Transport Special . . . .. 22
Carrier Types . . . .. . . 23
Industry Concentration. . .. . . . .. 27
Vehicle Sizes . . ... .... . . 29
Weekly Pattern of Truck Passings. . . .. . 33
SUMMARY . .. . . . . . . 37
RECOMMENDATIONS. . . .. . . . . 39
FOOTNOTES. . . . . . . . 41
REFERENCES ... . . . . . . 43
LIST OF TABLES
Number Page
1. Cash receipts for greenhouse and nursery commodities in three
leading states--California, Florida and Texas from 1980 to
1984 in 1,000 dollars . . . . . 2
2. Truckload equivalents of ornamental shipments by type of plants
from Florida in 1981 and 1984 . . . .. 6
3. Truckload equivalents of ornamental shipments by regions within
Florida in 1984 .... . . .. .. 14
4. Truckload equivalents of Florida ornamental plants shipments to
regions by types of plants in 1984. .. . . .. 18
5. Concentration measures for ornamentals transport in 1984. ... 28
6. Ornamental truck passing by size of vehicles and distance in
1984 . . . . . . . 31
LIST OF FIGURES
Number
1. Florida ornamentals shipments in 1984 . . .
2. Florida ornamental shipments in 1981. . . .
3. Annual patterns of shipments for ornamental and
produce in 1984 . . . . . .
4. Patterns of annual shipments for cut fern and
green, bedding plants and landscape plants in 1984. .
5. Pattern of annual shipments for foliage plants,
potted flowers and mixed plants in 1984 . . .
6. Loading zones for ornamental plants within Florida in 1984.
7. Florida ornamental shipments by regions in 1984
(truckload equivalent). . . . . .
8. Ornamental shipments from zones within Florida by
month in 1984 . . . . . .
9. Destination regions of Florida ornamental shipments in 1984
10. Deliveries of Florida ornamental shipments to northern and
southern regions in 1984. . . . .
11. Truckload rates for ornamentals and produce
1982 through 1986 . . . . . .
12. Truck passing of Florida ornamental shipments by
carrier types and distance in 1984 . . .
13. Truck size and trip distance comparisons of Florida
ornamentals in 1984 . . . . .
14. Average weekly pattern of Florida ornamental shipments
in 1984 . . . . . . .
15. Weekly pattern of Florida ornamental shipments by distance
in 1984 . . . . . . .
Page
7
7
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S. 34
. 35
. 11
. 12
. 15
. 20
. 21
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. 35
FLORIDA ORNAMENTALS:
SHIPPING ORIGINS AND DESTINATIONS
AND CHARACTERISTICS OF TRANSPORTATION
by
Mohammed Rahmani
Richard Bellock'
Robert Strain
INTRODUCTION
In 1984 the Florida, ornamentals industry [foliage plants, cut foliage
(ferns & greens), landscape plants, bedding plants, and potted flowering
plants] ranked second only to citrus in terms of total agricultural
revenue. In 1984, ornamentals accounted for 16.4 percent of cash receipts
from all Florida agricultural enterprises.(U.S.D.A. 1985a). While
Florida's foliage plant industry is the largest in the nation, Florida's
ornamentals industry is the second largest in the country: California's is
first. Finally, Florida ornamentals is among the fastest growing in the
nation. Between 1980 and 1984 the value of ornamentals produced in Florida
more than doubled (Table 1).
Despite its importance, little information on marketing and
distribution of ornamentals is available. This impedes planning by
industry participants and policymakers. To maximize returns from their
endeavors, wholesale growers, brokers, and transporters need to be able to
gauge the scope and condition of existing markets. For example, without
Table 1. Cash receipts for greenhouse and nursery commodities in three
leading states--California, Florida and Texas from 1980 to 1984
in 1,000 dollars.
Year
State 1980 1981 1982 1983 1984
California
Value 890,000 962,000 943,000 1,017,459 1,244,520
% of commodities 6.6 7.1 6.5 7.8 8.8
within state
Florida
Value 339,095 490,000 555,000 650,267 750,520
% of commodities 8.9 11.3 12.8 14.1 15.4
within state
Texas
Value 176,000 333,000 260,000 333,000 361,000
% of commodities 2.0 3.7 2.9 3.7 3.7
within state
Source: USDA,ERS 1981, 1985,
and 1986a
3
information regarding the distribution of shipments for the industry, it
may be difficult for an individual producer to identify potential market
areas for its products. To an individual producer, the third most
important ornamentals producing state, Texas might, appear to be a poor
market for Florida ornamentals. Yet in 1984 Texas was the most important
destination market for Florida ornamentals, accounting for 11 percent of
all interstate shipments.
The objective of this report is to present information regarding the
destination and timing of ornamental shipments, and information on the
characteristics of the transportation system. In the second section the
data employed in the study are briefly described. In the third section
shipment areas are determined by examining origin points for ornamentals
shipments. Destination areas are also examined. Finally, seasonal
fluctuations and differences in these across plant types are also
addressed. The next section is devoted to an analysis of the
transportation system, including carrier types, concentration levels,
vehicle sizes, and weekly shipment patterns. In the final section the
results are summarized and recommendations are made for continued analysis
and monitoring of the industry.
DATA
The data used in this study consist of information on every shipment
by truck from the Florida Peninsula. It was collected by the Florida
Department of Agriculture and Consumer Services at their Florida
Agricultural Inspection Stations. These facilities are arrayed in an arc
across the northern part of the Peninsula. They are open at all times and
4
cover every possible routings out of the Peninsula.1 All trucks, vans, and
vehicles with trailers are required to stop. As virtually all ornamentals
are carried by truck, the data gives an essentially complete picture of
shipments from the Peninsula. The Florida Panhandle is of relatively minor
importance in terms of ornamentals production. Therefore, these data also
may be viewed as accurate, for all practical purposes, for the State as a
whole. For each truck or van carrying ornamentals, information was
collected on the following:
1. carrier firm name
2. types and amounts of ornamentals
3. origin and destination
4. number of drops
5. vehicle size.
In addition, the date of the observation was noted.
The data employed in this study are for 1981 and 1984. The numbers of
observations in each year were 22,861 and 38,239, respectively. Unless
otherwise noted, the discussion in this report will focus on the 1984 data.
References to 1981 will be made primarily to point up differences between
the years. The data are unusually complete, but it is regrettable that the
most recent data available are about three years old. The age of this
information is particularly serious given the industry's high growth rate.
It is most important to have up-to-date information when conditions are
rapidly changing in order to be able to make appropriate adjustments.
Indeed one of the principal recommendations of this report will be that
efforts be initiated to develop and maintain more current reports.
5
SHIPMENT CHARACTERISTICS
In this section, the origins of Florida ornamentals shipments and the
subsequent destination markets are examined.
Volume and Type
To prevent product damage, ornamentals generally are not packed
tightly together. Branches and leaves of plants are given space to be
fully extended or, at most, plants are loosely tied. Therefore, ornamental
loads are not very dense. Shipments are measured in volume rather than
weight. The shipment was assumed to be equivalent to the cubic capacity of
the vehicle. Thus if a driver reported that he/she had a full load, the
shipments was assumed to be equivalent to the cubic capacity of the
vehicle. Similarily, if the driver indicated that the vehicle was not full
(only 5 percent were not full)2 it was assumed that the volume was equal to
two thirds the cubic capacity of the truck. "Truckload" was adopted as a
standard unit of volume. A "Truckload" is the equivalent of the volume of
a 45 foot long trailer.
Five types of ornamentals were identified: foliage, cut ferns &
greens, landscape plants, potted flowers, and bedding plants. In the 1981
data, foliage and cut ferns & greens were combined. For loads with more
than one type of ornamental a mixed category is also specified.
In Table 2 and Figure 1 and Figure 2 are presented the volumes of
Florida ornamental shipments in 1981 and 1984. In 1981 there were 18,356
truckloads versus 31,689 in 1984, a 73 percent growth in just three years.
With roughly two thirds of the total volume, foliage is clearly the
predominant ornamentals type. Foliage is followed distantly by cut ferns &
greens and landscape plants.
Table 2. Truckload equivalents of ornamental shipments by types
from Florida in 1981 and 1984.
of plants
1981 1984
Truckload Truckload
Types of plants equivalent Percentage equivalent Percentage
Foliage plants 16,295 88.77 21,110 66.96
Cut fern &
landscape plants incl above incl above 6.171 19.4
Combined 16,295 88.77 27,391 86.36
Landscape plants 871 4.75 2,197 6.92
Mix plants 550 3.00 1,144 3.61
Potted flower plants 437 2.38 840 2.65
Bedding plants 93 0.51 115 0.36
TOTAL 18,3562 100 31,689 100
Notes: 1. In 1981 Cut Fern and Green were included with foliage plants.
2. In 1981, 973 Truckload Equivalents were not identified by the
plant types, and are not included in this total.
30
28 -
26
24
22
S.2
14
j 12
10
8 -^
2 *
FOUAGE PL LANDSCAPE PL MI PFL. POTTED FL KEDDCNG PL
TYPE OF PLANTS
FOUAGE PLANT We CUT FERN & RWEEN
FIGURE 1: FLORIDA ORNAMENTAL SHIPMENTS IN 1984
2B -
2e -
24 -
22 -
20 -
18 -
i
2It
03 514 -
t 12
10
a
4
2
8-
FOLUAGE.PT.CUT LANDSCAPE PL MIX PL. POTTED FL BEDDING PL
TYPE OF PLANTS
FIGURE 2: FLORIDA ORNAMENTAL SHIPMENTS IN 1981
8
In a statistical sense, the differences between the distributions of
the plant types between 1981 and 1984 are highly significant (the estimated
chi square equals 122). The major changes are a reduction in the combined
Foliage/Cut Greens & Ferns category from 89 to 86 percent from 1981 to 1984
and an increase from 5 to 7 percent in the share of Landscape Plants. With
data from only two years, it would be rash to assume that these changes
constitute a trend. This is particularly true due to the change in
categorization schemes between the two years. It is possible that some of
what in 1981 would have been recorded as Foliage/Cut Ferns & Greens, in
1984 was recorded as Landscape Plants.
Seasonal Variations in Shipments
Despite the use of sheltered growing areas, there are seasonal swings
in ornamentals shipments. No doubt this is due to a combination of
climatic factors in Florida versus competing growing areas, and demand
variations in consuming areas. The relative importance of these factors,
however, is not known. In 1984, monthly shipment levels averaged 3,183
truckloads. In the beginning of the year shipment levels rose from around
2,600 truckloads per month in January to the annual peak of 4,200
truckloads in April. Thereafter, shipment levels gradually fell to just
under 3,000 truckloads in July, recover through the late summer to around
3,200 truckloads in September, and finally decline to the annual low of
just over 2,000 truckloads in December (Figure 3). A similar pattern was
evident in the 1981 data.
Compared to many nonagricultural commodities, the seasonal variations
in ornamentals shipment levels are pronounced. However, relative to
260
240 -
220 -
200
180 -
0160 -
140 -
w t o
S120 -
Jon feb Mor April Moy June July Aug Sept Oct Nov Dwe
D PRODUCE + ORNAMENTALS
FIGURE 3; ANNArL PATTERNS OF SHIPMENTS FOR ORNAMIr NTL AND
PRODUCE IN 198-
80
C 60
0 40
20
Jon Feb Mar April May June July Aug Sept Oct Nov Dec
MONTH
C PRODUCE + ORNAMENTALS
FIGURE 3: ANNUAL PATTERNS OF SHIPMENTS FOR ORNAMENTAL AND
PRODUCE IN 1984
10
produce shipments out of the state, ornamentals shipment levels are quite
stable (Figure 3). The coefficients of variation3 for monthly ornamentals
and produce shipments are, respectively, .19 and .70. On average,
variations in produce shipments are over four and a half times those of
ornamentals.4 However, in the months of July, August and September, there
is actually a higher volume of ornamentals than produce shipments.
Seasonal Variations by Plant Type
In Figures 4 and 5 the seasonal shipment patterns of each plant type
are presented. As might be expected, there are considerable differences
across the types, though all have a peak in or around April and several
have another peak in or around September. Judging by their coefficients of
variation, Bedding Plants exhibit the most variation and Mixed Plants and
Cut Ferns & Greens exhibit the least:
Plant Type Coefficient of Variation
Bedding Plants .67
Potted Flowers .45
Landscape Plants .38
Foliage Plants .19
Mixed .16
Cut Ferns, Greens & Cut Foliage .16
All Ornamentals .19
Loading Zones within Florida
Shipment origin or loading zones were determined by examining the
origin points for the interstate movements. Origin zones probably
correspond to production zones in Florida, assuming, of course, that
products are not transported long distances within the state prior to being
230 -
220 -
210 -
200 -
190
180 -
170 -
160 -
0
150 -
w 140 -
130 -
1 20 -
I110 -
0 100 -
90
I so -
80 -
50 -
40 -
Jan Feb Mar April May June July Aug Sept Oct Nov Doe
Month
0 CUT FOLIAGE + BEDDING PLANTS
o LANDSCAPE PULNIS
FIGURE 4: PATTERN OF ANNUAL SHIPMENTS FOR CUT FERN & GREEN,
BEDDING PLANTS AND LANDSCAPE PLANTS IN 1984
90 -
180 -
170 -
160 -
150 -
C 140 -
k 130 -
k120 -
1 10 -
90
soI
10
60
50
Jan Feb Mar April May June July Aug Sept Oct Nov Dec
MONTH
0 FOLIAGE PLANTS + POTTED FLOWER
O MIXED PLANTS
FIGURE 5: PATTERN OF ANNUAL SHIPMENTS FOR FOLIAGE PLANTS,
POTTED FLOWERS AND MIXED PLANTS IN 1984
13
loaded onto the vehicle that performs the interstate haul. It is believed
that this assumption is accurate for almost all cases.
Ornamentals were loaded from over 200 points in the Peninsula. These
points were grouped into three loading zones: Northern, Middle, and
Southern (Figure 6).
The truckload equivalents by zone and plant type are presented in
Table 3 and Figure 7. In terms of total shipments, the Middle and Southern
Zones are almost identical, 46.9 and 47.3 percent, respectively. With less
than 6 percent of the total shipments, the Northern Zone is of relatively
minor importance. However, with respect to Landscape Plants, the Northern
Zone predominates, accounting for over 60 percent (Table 3). It seems
probable that this is due to greater tolerance to cold temperatures by
plants in this category. The Middle Zone accounts for over 60 percent of
Mixed Plants. It may be that this is due to consolidation for interstate
transport of different plant types from the Southern and the Middle Zones
at terminals located in the Middle Zone. For the other categories of
plants, the Northern Zone is a minor supplier, with the Middle and Southern
Zones supplying nearly equal amounts. The shares supplied by the three
zones is surprisingly constant across the year (Figure 8). This reflects
the fact that by using a combination of sheltered and unsheltered growing
areas, the growers in each area are able to supply their markets throughout
the year.
Destinations
In this subsection the areas to which Florida ornamentals are shipped
will be detailed. To facilitate this discussion eight regions were
Table 3. Truckload equivalents of
Florida in 1984.
ornamental shipments by regions within
Regions
Southern Middle Northern Total
Type of Plants zone zone zone
Foliage plants 8526.1 9976.6 462.6 18965.3
(45.0) (52.6) (2.4) (100)
Cut fern and greens 3817.9 2234.3 15.6 6067.8
(62.9) (36.8) (0.3) (100)
Landscape plants 385.9 260.6 1111.6 1758.1
(22.0) (14.8) (63.2) (100)
Mix plants 415.6 673.2 17.3 1107
(37.6) (60.8) (1.6) (100)
Potted flower plants 385.9 290.8 43.2 719.9
(53.6) (40.4) (6.0) (100)
Bedding plants 41.9 36.5 8.1 86.5
(48.4) (42.2) (9.4) (100)
TOTAL No. 13574.2 13472.0 1658.4 28704.6
% (47.3) (46.9) (5.8) (100)
1984,
Notes: 1. Row Percentages in parentheses.
2. Data include loading points with more than 100 loads in
which account for more than 90 percent of all loadings.
FIGURE 6: LOADING ZONES FOR ORNAMENTAL PLANTS WITHIN FLORIDA
IN 1984
Northern Zone
Middle Zone
Southern Zone
.b '0
(TRUCKlOAD EQUIVALENT)
80
70
50-
2D
50
FOLIAGE CUT FOULAGLANDSCAPE PL MIX PL. POTTED FLOWER BEDDING PL.
IJ SOUwIH M MIDDLE M NORTH
FIGURE 7: FLORIDA ORNAMENTAL SHIPMENTS BY REGIONS IN 1984
50 -
40 -
2D
10
20
0 t-Ii t.... |' -'- i I- I -I -"
Jon Feb Mar April May June July Aug Sept Oct Nov Dec
MONTH
FIGURE 8: ORNAMENTAL SHIPMENTS FROM ZONES WITHIN FLORIDA
BY MONTH IN 1984
Table 4. Truckload Equivalents of Florida Ornamental Plant Shipments to
Regions by Types of Plants in 1984.
Types of Plants
Cut Fern
Foliage and
Regions Plants Greens
Land-
scape
Plants
Potted
Mix Flower
Plants Plants
Total
Bedding number
Plants (%)
5143.2 1227.6 1198.4 356.5 292.2 58.3
(24.2) (19.9) (54.5) (31.1) (34.8) (50.5)
4111.8 1840.8
(19.4) (29.8)
4024.4 1164.4
(19.0) (18.9)
1698.4 436.5
(8.0) (7.1)
3920.4 757.8
(18.5) (12.3)
947.0 369.6
(4.5) (6.0)
539.9
(1.7)
61.8
(1.0)
917.9 265.9
(4.3) (4.4)
97.7
(0.5)
46.9
(0.8)
190.8 176.9 235.5 28.6 6584.4
(8.7) (15.5) (28.0) (24.8) (20.8)
67.5 202.8 102.5
(3.1) (17.7) (12.2)
36.9 78.2
(1.7) (6.8)
35.4
(4.2)
534.6 195.8 106.7
(24.3) (17.1) (12.7)
116.3 50.8
(5.3) (4.4)
25.3
(3.0)
12.7 18.3 4.5
(0.6) (1.6) (0.54)
31.0 57.3
(1.4) (5.0)
8.9 8.0
(0.4) (0.7)
36.1
(4.3)
2.0
(0.2)
8.1 5569.8
(7.0) (17.6)
2.0 2287.3
(1.7) (7.2)
7.2 5522.5
(6.2) (17.4)
1.0 1510.0
(0.9) (4.8)
0 457.3
(0.0) (1.4)
9.1 1317.3
(7.9) (4.2)
1.0 164.5
(0.9) (0.5)
6171.3 2197.1 1144.5
(100) (100) (100)
840.3 115.4 31889.3
(100) (100) (100)
Southeast
8276.3
(26.1)
Northeast
Lake
States
North
Plains
South
Plains
Farwest
Northwest
Canada
Others
TOTAL NO.
%
21220.7
(100)
19
specified. The continental United States is divided into seven regions,
and the eighth region is Canada (Figure 9). In Table 4 shipments by region
and plant type are presented. The three eastern most regions (the
Southeast, Northeast, and Lake States) together account for 65 percent of
all deliveries. Of the remaining regions, the South Plains, with 17
percent of all deliveries, is the most important. Within this region Texas
is the dominant receiver with 11 percent of all deliveries. Indeed, Texas
is the most important receiver state or province (number two is Georgia,
just under 11 percent, and number three is New York, 6 percent). The
remaining four regions (the North Plains, Far West, Northwest, and Canada)
together account for 18 percent of all deliveries.
Destination by Type of Plant
There are considerable variations across the plant types with respect
to destination regions. It is believed by the authors that these are due
primarily to climatic differences across the regions that would affect
plants that are typically kept out-of-doors after delivery, but not those
that are usually displayed inside. To explore this hypothesis, two
destination areas, NORTH and SOUTH, were created by combining the five
northernmost regions (the Northeast, Lake States, North Plains, Northwest,
and Canada) and the three southernmost regions (the Southeast, South
Plains, and Far West). Other things being equal, a larger proportion of a
plant type would be expected to be delivered to the NORTH if plants in that
type are customarily displayed indoors and visa versa. Indeed, this
appears to be the case (Figure 10). The two plant types with the highest
percentages going to the NORTH, Cut Foliage (Ferns & Greens) (61 percent)
FIGURE 9: DESTINATION REGIONS OF FLORIDA ORNAMENTAL SHIPMENTS
IN 1984
Canada
BEDDING LANDSCAPE
FOLIAGE
POTTED FL MIXED
ALL PLANTS .
IJ NORTHERN REGION
FIGURE 10: DELIVERIES OF FLORIDA
NORTHERN AND SOUTHERN
PLANT TPE
7~ SOUTHERN REGION
ORNAMENTAL SHIPMENTS TO
REGIONS IN 1984
-I
0 1
60-
50-
40 -
CUT FOL
I _I
22
and Foliage (52 percent) are displayed primarily indoors. The two with the
lowest percentages going to the NORTH, Landscape Plants (16 percent) and
Bedding Plants (41 percent), are displayed primarily out-of-doors. The
remaining types, Mixed Plants and Potted Plants, may be displayed either in
or out-of-doors.
TRANSPORTATION CHARACTERISTICS
In this section, the industry structure, types of equipment used, and
the weekly pattern of deliveries by the motor carriers serving the Florida
ornamentals industry are briefly examined. It should be noted that only
negligible quantities of ornamentals are shipped by air or rail.
Is Ornamentals Transport Special?
It was previously noted that the number of truckloads of produce
shipped out of the state is over four and a half times greater than for
ornamentals. The large majority of both produce and ornamentals are
transported in the same type of equipment, refrigerated tractor-trailers.
Moreover, it is known that some carriers will carry both produce and
ornamentals (though not in mixed produce/ornamentals loads). The question
arises, therefore, if ornamentals transport is a distinct industry or
market. That is, it may be more appropriate to view ornamentals transport
as a part of the industry serving produce.
There are two principal reasons for suspecting that ornamentals
transport is distinct from produce transport. First, ornamentals often
require special racks or shelving that are not used for produce. Second,
23
individual shipment sizes for ornamentals are generally much smaller than
for produce. To accommodate these smaller shipment sizes, several carriers
specializing in ornamentals maintain small vehicles for local pickups and
facilities to assemble shipments into truckload lots for interstate
movements. This assembly system is absent from produce transport in
Florida.5 However, the acid test to determine if ornamentals and produce
transport constitute different markets is an examination of movements over
time in their freight rates. If ornamentals and produce freight rates are
highly correlated, then it can be assumed that they are for essentially the
same services) and vice versa (Stigler and Sherwin). The empirical
evidence strongly indicates that these are separate transportation markets.
In Figure 11 freight rates for ornamentals and produce shipped from Florida
between November 1982 and May 1986 are presented.6 Rates for ornamentals
range from 95 to 169 percent of those for produce. For six of the twelve
intraseason rate changes ornamentals and produce rates moved in opposite
directions, and their correlation coefficient was only .096.
Carrier Types
For the purposes of the analysis, carriers are grouped into two
categories according to the number of times in 1984 that a truck from that
firm left the Peninsula with ornamentals (truck passings:
Specialized Carriers with 50 or more ornamentals truck passing per
year
Occasional Carriers with 1 to 49 ornamentals truck passing per
year.
Fifty-three firms were identified as Specialized and 7,426 as Occasional.
The two carrier types accounted for 46 and 54 percent, respectively, of all
2.1
2
1.9 -
t.7 -IA
1.3 -
1.2
NB2 J83 MR83MY83 NB3 J84 MR84MY84 NB4 J85 MR85MY85 NB5 J86 MR86MY86
Month ond Yeor
0 PRODUCE + ORME'NTALS
FIGURE 11i TRUCKLOAD RATES FOR ORNAMENTAS AND PRODUCE
1982 THROUGH 1986
25
of the truck passing. Specialized carriers tend to utilize larger trucks;
they accounted for 51 percent of the truckload equivalents (the average
capacities of Specialized and Occasional carrier vehicles were 2,907 and
2,217 cubic feet, respectively).
Occasional carriers tend to be utilized for shorter distance
movements. The average origin-to-destination distance for an Occasional
carrier was 919 miles, versus 1,094 for Specialized carriers. If the
percent of truck passing by the carrier types is plotted against distance,
the share for Occasional carriers falls continuously with greater distance.
Beyond 1100 miles Specialized carriers account for the bulk of the truck
passing (Figure 12).
Another difference between the carrier types is that Specialized
carriers were more likely than Occasional carriers to have loads requiring
multiple drops (71 versus 41 percent, respectively). This is not
surprising as Specialized carriers maintain facilities specifically for the
assembly of multiple shipment (hence, multiple drop) loads. With respect
to other sectors of motor carriage, there have been concerns regarding the
possibility of multiple drop trucking (known as LTL, for less-than-
truckload) to become highly concentrated. The rationale behind these
concerns is the assumption that there may be significant economies of size
related to the assembly facilities.7 The extent of concentration in this
industry as a whole and, in particular, in its LTL portion is examined in
the next subsection.
60
00 -
30 -
0-300 300-600 600-900 900-1200 1200-1500 500- 18t
DIsrmct BV MtLE
t0 SPEdCLIZtD eCARRotm + OCcSIoL CAflMtS
PIGURf 12 t TRUCK PASSING OF FLORIDA ORNAMENTAL SHIPMENTS
BY CARRIER TYPES AND DISTANCE IN 1984
Industry Concentration
By multiplying the origin-to-destination distance with the truckload
equivalence, a measure of output of transportation services, CUBE/MILES,
can be derived.8 This, in turn, may be employed to investigate the level
of concentration in the Florida ornamentals transportation market. In
Table 5 concentration ratios are presented for all shipments, single drop
and multiple drop shipments, and multiple drop shipments over and under 500
miles.
For all shipments, the concentration ratios do not appear to be
unusually high relative to those for other trucking markets and for U.S.
industry as a whole. The four firm concentration ratio for all ornamentals
shipments in 1984 was .34, compared to .39 for all U.S. manufacturing in
1972 and to between .28 and .50 for nonagricultural, nonspecialized
trucking (known as general freight) in 1983 (McClure):
Region 1984 four firm concentration ratio of ornamental
shipments
Eastern Central .50
Pacific Inland .49
Rocky Mountain .48
Central States .30
Middle Western .28
Middle Atlantic .28
It should be stressed, however, that linkages between industry structure
and behavior are likely to vary across industries. There is no guarantee,
therefore, that an industry with a given level of concentration will or
will not perform in a satisfactory manner.
Table 5. Concentration Measures for Ornamentals Transport in 1984.
Concentration All Less than
Ratios Ship- Truckload Truckload LTL Under LTL Over
(# firms) ments (single drop) (multiple drop) (500 mi.) (500 mi.)
1.00
1.00
5,406 2,850
1.00
.19
.30
.41
.48
.62
.66
.69
.71
.77
.81
.85
.88
.89
.91
1.00
694 2,362
1
2
3
4
8
12
16
20
50
100
200
300
400
500
All
Number of
Firms
1.00
7,479
29
As would be expected considering the tendency of Specialized carriers
to carry multiple drop loads and longer distance loads, the most
concentrated segment of Florida ornamentals trucking is that for multiple
drop loads with over 500 miles trip distance. The four largest firms
hauling this type of load accounted for 48 percent of the total volume,
(rightmost column of Table 5). This compares to the least concentrated
segment of the industry, that for single drop loads, in which the four
largest firms accounted for only 15 percent of the volume (column 2 of
Table 5). These results suggest that the larger Specialized carriers may
enjoy a considerable degree of market power with respect to long-distance,
small size shipments (1.e., LTL over 500 miles). However, it seems likely
that this is at least in part obviated by one or more of several
mechanisms, including: competition among the Specialized carriers,
competition from the 2,309 Occasional carriers that haul this type of load,
the threat of competition from those not currently hauling this type of
load (i.e., contestability), and the ability of shippers and receivers to
reschedule shipments to facilitate single drop loads.
Vehicle Sizes
Florida ornamentals are transported interstate in everything from
small vans to full sized tractor-trailers. The average length of the cargo
space for a vehicle carrying ornamentals in 1984 was just over 38 feet, and
the distribution of sizes was as follows:
Length of cargo space Number of truck passing Percent
Under 9 feet (vans) 531 1.4
10 to 15 feet 2,778 7.3
16 to 24 feet 4,235 11.1
25 to 38 feet 1,829 4.8
Over 38 feet 28,808 75.4
30
With over three quarters of all truck passing, the full sized tractor-
trailer (here defined as those over 38 feet) is the dominant type of
vehicle.
In virtually all cases, these tractor-trailers are equipped to control
the temperature of the cargo space. Many of the smaller trucks,
particularly the vans, may or may not have this capability. Without the
ability to control temperature, length of time that ornamentals can be held
in a vehicle is limited by the temperature tolerance of the plant type(s)
in the load and the ambient temperatures. Moreover, the longer the
distance, ceteris paribus, the more important are the labor and (usually)
the fuel savings of consolidating loads into fewer large, rather than
several small trucks.9 For both of these reasons, it would be expected
that larger trucks would tend to be utilized for longer distance hauls.
Table 6 and Figure 13 are presented as compelling evidence that this is the
case. Nearly 60 percent of the truck passing for vehicles with cargo
spaces under 39 feet long were for trips of 600 miles or less (Figure 13).
This compares with only 11 percent of the vehicles with longer cargo beds.
Less than 2 percent of truck passing for the smaller vehicles (i.e., cargo
beds under 39 feet) were for trips over 1300 miles, versus nearly 18
percent for the larger vehicles (Figure 13).
Weekly Pattern of Truck Passings
The frequency of truck passing varies considerably across the week.
In an average week, the number of truck passing is lowest on Monday (8
percent), rises to a moderate midweek peak, and thereafter climbs to
Saturday which alone averages over 20 percent of the week's total (Figure
Table 6. Ornamental Truck
1984.
Passings by Size of Vehicles and Distance in
Distance
Length of 0-600 600-1300 Over 1300
Vehicles Miles Miles Miles Total
9 feet or less 453 75 3 531
(83.3) (14.1) (0.6) (100)
10-15 feet 1944 802 32 2778
(70.0) (28.9) (1.1) (100)
16-24 feet 2206 1944 85 4235
(52.1) (45.9) (2.0) (100)
24-38 feet 820 981 28 1829
(44.8) (53.1) (1.5) (100)
39 feet or 3197 20455 5156 28808
longer (11.1) (71.0) (17.9) (100)
TOTAL NO. 8620 24257 5304 38181
% (22.6) (635)(13.9) (100)
Note: Row percentages in parentheses
50 -
so -
40
30 -
20 -
to10 -
0 600 Miles
7
K
7
601 1300 Mites
Over 1300 MIle
M Under 39 Feet
TRIP DISTANCE
P 39 Feet or Longer
FIGURE 131 TRUCK 8IZZ AND TRIP DISTANCE COMPARISON
OF FWLRIDA ORNAMENTAL SHIPMENTS IN 1984
N
K
/
?q I
\ \U
33
14). The weekly pattern of truck passing is related to the distance of
the haul. For example, for trips of 600 miles or less Saturday and Sunday
are the low volume days, with nearly equal shipment volumes during the
weekdays (Figure 15). For hauls between 600 and 2,400 miles the pattern is
similar to that for all truck passing. Finally, for trips over 2,400
miles, Monday averages only 3.5 percent of the week's total, and there is a
single peak on Thursday, at which time almost a quarter of the truck
passing occur. Segmenting in 600 mile increments, the following
percentages of truck passing were observed on the weekend:
Trip Distance (miles)
0-600 601-1200 1201-1800 1801-2400 Over 2400
Percent of truck
passing on the 17 38 36 44 33
weekend
Clearly much higher percentages of hauls over 600 miles leave the Florida
Peninsula on Saturdays and Sundays than is true for shorter trips.
The question, is why should this distance-outshipment day relationship
exist? It seems plausible that the pattern of outshipment days is in large
part dictated by receiver delivery day preferences. Moreover, there is no
obvious reason to suspect that wholesalers and retailers located far from
Florida would be more or less likely to prefer deliveries on weekends. If
true, then the percentages of delivery days at each distance that are on
the weekend should be approximately the same. For a rough approximation of
delivery days, the following are assumed:
Trip Distance (miles)
0-600 601-1200 1201-1800 1801-2400 Over 2400
Outshipment days for Fri & Thr & Wed & Wed & Tue &
weekend delivery Sat Fri Thr Thr Wed
22
21
20
19
z 18 -
15
to
TIMM 144 AVERAGE -ERRtt PATTM ()IP
S M12 19
10
9 -
8 -
7 -- I I -
Sunday Monday Tuesday Wednesday Thursday friday Stolurdey
DtwY
PIGURU 14t AVERAGE WEKLY PATTE'MRnt OF PtORIDA ORNAMNTAL
SHIPMErNTS Ni 1984
28
26
24
) 22
O
Z 20 -
S18 -
10
Y
I- 12
Ll
S0 O
w
0 6
OI'
2 --"I--
Sunday Monday Tuesday Wednesday Thursday Friday Saturday
DAY
a 0 to 600 miles + 1200 to 1800 mile
0 Over 2400 miles
FIGURE 15 WEEKLY PATTERN OF FLORIDA ORNAMENTAL SHIPMENTS
BY DISTANCE IN 1984
36
The above delivery time estimates are, in turn, based upon three
considerations:
1. 600 miles is approximately the limit that a single driver legally
can cover per day,
2. receiving docks at many florists may not be open all day on
Sunday, and
3. for distances above 1,800 miles carriers are likely to use team
drivers.10
Using these delivery time estimates, the average percentages of weekend
deliveries are as follows:
Trip Distance (miles)
0-600 601-1200 1201-1800 1801-2400 Over 2400
Percent of weekend
deliveries 24 25 26 24 20
The pattern of deliveries across distance is much more even than that for
outshipments, supporting the hypothesis that delivery day preference is the
principal cause of the observed distance-related differences in the
distribution of outshipment days.
37
SUMMARY
The major findings in this study are:
1. Between 1981 and 1984, the volume of product shipped by the
Florida ornamentals industry increased by 73 percent (from 18,356
to 31,689 "Truckloads"). Florida has the nation's largest
foliage and second largest ornamentals industry. Within Florida
ornamentals ranked second behind citrus in 1984.
2. Foliage is the most important single type of ornamentals,
accounting for nearly two thirds of all interstate shipments.
3. Ornamentals shipments follow distinct seasonal swings. For all
ornamentals, April is the peak month. The degree of seasonality
for ornamentals is much less than for produce. In fact, during
July, August, and September produce shipment levels actually fall
below those for ornamentals.
4. Ornamental shipments for the Peninsula are almost evenly divided
between the middle and southern areas. With the exception of
Landscape Plants, the northern area of the Peninsula is of
relatively minor importance as a shipping area. The shares of
total shipments accounted for by the three regions of the
Peninsula remain almost constant across the year.
5. Approximately two thirds of all Florida ornamentals are delivered
to the states east of the Mississippi River. The Southeast is
the single most important region (25 percent), followed by the
Lake States (20 percent) and the Northeast (19 percent). The
South Plains is the most important destination market west of the
Mississippi River. This is primarily due to Texas, which
38
accounts for nearly two thirds of the 17 percent South Plains
share.
6. Differences across plant types regarding destination areas
appears related to climatic conditions in the destination region
and to whether the plant type is displayed indoors or out-of-
doors.
7. Carriers specializing in ornamentals transport (i.e., those with
more than 50 truck passing annually) tend to:
1. use larger vehicles
2. have longer average lengths of haul
3. make multiple drops.
8. The level of concentration in the ornamentals transportation
industry appears to be moderate. However, due to the above-
mentioned areas of emphasis for specialized carriers,
concentration levels are higher with respect to longer distance,
multiple drop loads.
9. The vehicles employed to haul ornamentals range from small vans
to full sized tractor-trailers. Three-quarters of the truck
passing were tractor-trailers. These larger trucks tend to be
employed for longer distance hauls.
10. There are distinct weekly shipment patterns. For all
ornamentals, Monday has the smallest number of truck passing and
Saturday has the highest. This pattern differs in accordance
with trip length. This appears to be due to receiver preferences
regarding delivery days.
39
RECOMMENDATIONS
Florida ornamentals in 1984 was second only in the state to citrus in
terms of gross farm receipts. Unlike the citrus industry, however, little
information on production, marketing and distribution of ornamentals is
available. The Florida Department of Agriculture and Consumer Services
collects valuable information on the industry at its inspection stations,
located at base of the Florida Peninsula. Unfortunately due to budgetary
and manpower restrictions, much of this information is never analyzed or
distributed. In this report, the results of an analysis of data for
calendar year 1984 has been presented. These results have quantified the
absolute volume of Florida ornamental shipments, the shipping origins
within the State, and seasonal and geographic patterns of shipments and
deliveries. Moreover, new information has been developed regarding the
structure and characteristics of the transportation sector.
It is anticipated that the information presented in this report will
be of value to industry participants and policymakers. However, as the
Florida ornamentals industry is changing and growing rapidly, the age of
the data seriously compromises its usefulness. An ongoing series of up-to-
date reports regarding this data would be an important planning tool for
industry participants and policymakers, and be of value to research and
extension personnel. Such reports would keep interested parties abreast of
the current situation and facilitate the identification of trends. With
over 16 percent of the State's total farm receipts, there can be no
question that ornamentals warrants this level of effort. It is therefore
recommended that representatives from the industry, the Florida Department
of Agriculture and Consumer Services, and the Institute of Food and
Agricultural Sciences meet to initiate such a project.
40
FOOTNOTES
1. To pass into or out of the Florida Peninsula one must cross over
either the St. Marys or the Suwanee River. The Agricultural
Inspection Stations are arrayed so as to intercept all traffic over
all of the bridges.
2. Cubic capacity was estimated as follows: (1) if bed length < 10 feet
(a van), 234 cubic feet; (2) if bed length > or 10 feet, 8 (width)
*8.5 (height) length; (3) if not full, then considered to be 2/3
full.
3. The coefficient of variation is a measure of variation scaled by the
average level of the variable in question. In particular, it is the
standard deviation divided by the mean.
4. For produce, unlike ornamentals, weight is usually a more limiting
factor than volume in transport. A truckload for produce is here
assumed to equal 40,000 pounds. The source for the data on produce
shipment amounts is USDA Fresh Fruit and Vegetables Shipments.
5. It could be argued that this function is sometimes accomplished at
Florida State Farmers Markets and by a few larger growers. However,
the authors are not aware of any produce carriers that maintains local
pickup vehicles and one or more assembly facility to prepare multiple
shipment, interstate loads.
6. For information regarding how these rates were collected, see Beilock,
1987.
7. For more detailed discussion on this point, see Chiang and
Friedlaender, Chow, Dailey, Emery, Horn, and McMullen.
41
8. This measure is directly analogous to weight/distance measures, such
as ton/miles or ton/kilometers, that are frequently employed in
transportation studies. Again, the use of cubic capacity, rather than
weight, is in recognition of the low density levels of ornamentals
cargos.
9. As the origin-to-destination distance increases, the importance of
costs related to spanning this distance increases relative to costs
associated with pickup and delivery functions.
10. The common use of team drivers for distances above 1,500 miles is well
documented, for example see Boles and Beilock.
42
References
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1987(forthcoming).
Chiang, J. and A. Friedlaender, "Truck Technology and Efficient Market
Structure." The Review of Economics and Statistics 65,2(1985):250-8.
Chow, G., "The Cost of Trucking Revisited." Motor Carrier Economic
Regulation: Proceedings of a Workshop National Academy of Sciences,
1978.
Dailey, V., The Certificate Effect: The Impact of Federal Entry Controls
on the Growth of the Motor Common Carrier Firm, unpublished
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Emery, P., "An Empirical Approach to the Motor Carrier Scale Economies
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Florida Crop and Livestock Reporting Service, Floricultural Crops. 1984
Winter Park, Florida, 1985.
Florida Foliage Association, Florida Foliage Locator: The Official
Directory of the Indoor Foliage Industry, Apopka, Florida, 1985.
43
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and Use Survey Government Printing Office, Washington, 1977.
44
U.S. Department of Agriculture, Economic Indicator of Farm Sector. State
Income and Balance Sheet Statistic 1980, Economics Research Service,
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