have been beneficial to all apple growers, yet only 60 percent contribute financial support. The inequities of voluntary cooperation cannot long endure, even though strongly supported by a majority. It would appear to be more in keeping with the democratic process, if and when two-thirds of the members of the industry agree on programs which are beneficial to the total industry, that everyone in the industry should support the project. The framework of the Agricultural Marketing Agreement Act, with the amendment offered, would provide the mechanism to make the democratic process workable. I think we must be aware, too, that in the inclusion of marketing development with paid advertising it is a new and little used tool. It does not negate the merit of the enabling legislation. Rather the complexity of organization required for market development and maintenance for each commodity requires time and much patience. Although apples have been around for a long time, there is real evidence that consumers do not know how to use them, when the various varieties are in season, nor why this fruit is one of the more nutritious ready-to-eat foods universally displayed in retail stores. This is a challenge to the apple industry. Production we have; sufficient markets we do not have. Part of the reason for market deficiency is the inability of the industry to join forces to the extent necessary to own its share of market. The concept of the Agricultural Marketing Order and Agreement Act provides the tool which may enable the industry to improve its techniques in mass marketing and to better inform the consumer. Nearly a score of other commodities are already authorized to use the marketing order mechanism. If for no other reason, apples should be included, too. To summarize, here are the other reasons: (1) The larger producing States do have marketing order programs for apples. (2) Groups of small States, such as the six New England States, with significant production can administrate one order more economically and equitably than each by itself. (3) The total apple industry will benefit from the added effort contributed by those States electing to improve markets with promotion and paid advertising. (4) Consumers will benefit from the efforts of the apple industry to improve its markets and to provide information about apples and apple products. Mr. Chairman, on behalf of Mr. Lyman and his committee and Mr. Bishop, we trust you will support this legislation. Thank you. Mr. FOLEY. Thank you very much, Mr. Berry. Are there any questions of Mr. Berry or of Mr. Bishop? Mr. VIGORITO. No questions. Mr. GOODLING. I might say, Mr. Chairman, there may be some people wondering why Pennsylvania is not included in any of these bills. We do have an apple promotion program that is supported through assessments and authorized by State law. Three years ago we had a referendum that was approved by the applegrowers of Pennsylvania. About 3 weeks ago we had another referendum that is required by our law. The response was far greater than 3 years ago. That would indicate that at least the growers in my State support this type of program. This is a self-help program, and that is what I am interested in. Mr. FOLEY. Any questions, Mr. Sisk? Mr. JONES. No questions. Mr. MYERS. No questions. Mr. FOLEY. Thank you very much, gentlemen. The absence of questions is usually a good sign. I hope the witnesses will not be troubled by the fact that they are not being barraged by questions from the subcommittee. The absence of questions usually goes well for future legislation. Thank you both for your appearances here. Please convey our thanks to Mr. Lyman for his statement. Mr. BERRY. We will. Mr. GOODLING. Pennsylvania apples would have made even a greater improvement in both instances. (The prepared statement of Mr. Lyman follows:) STATEMENT OF JOHN LYMAN, JR., CHAIRMAN, OUTLOOK COMMITTEE, NEW YORK & NEW ENGLAND APPLE INSTITUTE I am John Lyman, Jr. of Middlefield, Connecticut, an apple grower and Chairman of the Outlook Committee of the New York & New England Apple Institute. For the past three years we have looked forward to the opportunity to present our views in regard to the proposed enabling legislation incorporated in H.R. 9736. Therefore, we are pleased to have the opportunity to appear before this Committee today in support of the bill introduced by Congressman Silvio Conte of Massachusetts. Attached to this statement are Resolutions adopted by some New England States and the State of New York in support of this legislation. PURPOSE OF THE BILL This bill amending the Agricultural Marketing Agreement Act of 1937 as amended, will include applies among a large number of fruits and vegetables which are now listed by a 1965 amendment. The authority thus established enables growers and handlers of these various commodities through the provision of marketing orders to regulate the supply and quality of product, and/or to conduct research and development projects including paid advertising. If enacted into law, the proposed bill would enable, or authorize groups of apple growers in those states named in section 608c(2) to establish marketing research, or development projects including paid advertising within the scope of regulations and procedures of the Act. Historically, the apple industry has not used the mechanism of federal marketing orders. The larger producing apple states appear to have answered many of their problems through state orders, agreements and regulations. They may continue to do so, even though the federal marketing orders may be used by other states. The changing patterns of production and marketing on the other and, are causing apple growers in these other states with much smaller production to consider ways and means to affect a more orderly marketing structure. For instance, Washington State and New York State now have apple promotion programs which are supported through grower assessments established by state enabling legislation. These are the two largest apple producing states which together, account for about 60 million boxes of apples, or approximately 46% of the 1966 crop. On the other hand, these two states account for about 75% of the market development projects including paid advertising in the industry. Other states with a much smaller production total find it difficult to justify a state marketing order for economic reasons. The administrative cost to operate such an order on a state by state basis would in many cases consume a major portion of the possible collections. It is conceivable that a group of states, such a the six (6) New England States could, under one administrative head develop a marketing order program with minimum administrative cost, and growers would share more equitably. In turn, the support by these growers would complement the development projects of the larger individual states, specifically, New York State in this instance. Under the authority granted in the Agricultural Marketing Agreement Act, as amended, and providing this bill is enacted, such a group of states could participate in those programs to be agreed upon. A BRIEF OF THE APPLE INDUSTRY Apples are produced commercially in thirty five (35) states stretching from Maine to Washington, and from Michigan to Georgia. The larger producing states. are Washington, (30 million bu.), New York, (23 million bu.), California, (10.6 million bu.), Michigan, (14.7 million bu.), Virginia, (8.7 million bu.), and Pennsylvania, (9.5 million bu.), and represent on the average about 70-75% of the total United States production. The six (6) New England States have an average production of 8.5 million bu., with approximately five hundred (500) commercial growers. Total national production of apples for the next ten (10) years will increase steadily and may reach an average of 160 million bu. per year compared to about 130 million in recent years. To maintain a healthy industry for the future, there will be a need for better management of supply, the expansion of markets and the development of new products. Research and development projects financed by producers and guided by the industry are a means to better supply management and creation of markets. THE NEW ENGLAND SITUATION For about thirty years (30) the New England apple growers have participated in a voluntary organization for the purpose of promoting apples and carrying on limited research projects. The programs have been beneficial to all apple growers, yet only 60% contribute financial support. The inequities of voluntary cooperation cannot long endure, even though strongly supported by a majority. It would appear to be more in keeping with the democratic process, if and when two-thirds of the members of the industry agree on programs which are beneficial to the total industry, that everyone in the industry should support the project. The framework of the Agricultural Marketing Agreement Act, with the amendment offered, would provide the mechanism to make the democratic process workable. A marketing Order drawn up by representatives of the industry and counseled by the Secretary of Agriculture, would be voted upon by all growers, or handlers of apples. The geographical area would be defined, and all growers within that area would be informed before voting. If approved by two-thirds of the grower, the Secretary would then establish the order. A TOOL FOR NEW MARKETS, AND TO BETTER INFORM CONSUMERS The inclusion of market development with paid advertising in the Agricultural Marketing Order legislation is a new and little used tool. That it has not been extensively used by the commodity groups does not negate the merit of the enabling legislation. Rather the complexity of organization required for market development and maintenance for each commodity requires time and much patience. Although apples have been around for a long time, there is real evidence that consumers do not know how to use them, when the various varieties are in season, nor why this fruit is one of the more nutritious ready-to-eat foods universally displayed in retail stores. This is a challenge to the apple industry. Production, we have; sufficient markets, we do not have. Part of the reason for market deficiency is the inability of the industry to join forces to the extent necessary to own its share of market. The concept of the Agricultural Marketing Order and Agreement Act provides the tool which may enable the industry to improve its techniques in mass marketing, and to better inform the consumer. Nearly a score of other commodities are already authorized to use the Marketing Order mechanism. If for no other reason, apples should be included, too. To summarize, here are the other reasons: (1) The larger producing states do have marketing order programs for apples. (2) Groups of small states, such as the six New England States, with significant production can administrate one order more economically and equitably than each by itself. (3) The total apple industry will benefit from the added effort contributed by those states electing to improve markets with promotion and paid advertising. (4) Consumers will benefit from the efforts of the apple industry to improve its markets and to provide information about apples and apple products. Mr. Chairman, on behalf of the apple growers in the six New England States, I urge you and vour committee to approve this bill and to expedite its passage in this present session of Congress. Thank you for your attention and interest. STANDING RESOLUTIONS REGARDING LEGISLATION AMENDING THE FEDERAL MARKETING AGREEMENT ACT OF 1937 NEW YORK & NEW ENGLAND APPLE INSTITUTE BOARD OF DIRECTORS MEETING, JULY 19, 1967 "It was moved, seconded and unanimously voted that the Board of Directors and those present support the introduction of a bill to amend the Agricultural Marketing Agreement Act, as presented." Resolution of the Maine Pomological Society, January 17, 1968 That the Maine State Pomological Society go on record to support the Enabling Legislation for a Federal Marketing Order for New England apples and that letters be sent to our Congressional Delegation in Washington to this fact. Resolution of the Vermont Fruit Growers, February 29, 1968 "Whereas the Vermont Fruit growers in view of the changing Market developments in the apple industry, and to assure the opportunity for a choice of future decision in marketing (to match competition) do hereby support the proposed legislation as embodied in H.R. 12314 which amends the Federal Marketing Order and Agreement Act to include “Apples". Middlebury, Vermont, February 29, 1968. Resolution of the New York State Horticultural Society, January 1969 Whereas a large state like New York can use a state marketing order to good advantage to collect money from all growers for apple promotion. Whereas the six New England states together produce about 1⁄2 of the apples of N. Y., and the operation of state marketing orders would be inefficient: Now, therefore, be it Resolved, That we support legislation that would make possible federal marketing orders for promotion in regions where conditions are similar. Mr. FOLEY. The final witness this morning is Mr. John Surgeon of Grafton, Ill. Mr. Paul Findley, our colleague from Illinois expressed his regrets to the committee that he was not able to be here. He has advised me that Mr. Surgeon is one of the outstanding orchardists of his State. Mr. GOODLING. Mr. Findley also asked me to tell the committee that he supports the bill under consideration. STATEMENT OF JOHN SURGEON, CHAIRMAN, ILLINOIS LEGISLATIVE COMMITTEE OF THE ILLINOIS FRUIT COUNCIL AND ILLINOIS HORTICULTURAL SOCIETY Mr. SURGEON. Mr. Chairman and committee members, I am John Surgeon from Grafton, Ill., a fruitgrower and chairman of the Illinois Legislative Committee of the Illinois Fruit Council and Illinois Horticultural Society. Most of the things have already been said concerning this bill. The reason Illinois is interested, as Mr. Lacy stated and Mr. Berry stated, is that we need a national effort in selling apples, in promoting apples and in quality control and maturity and that sort of thing. The only way we can get a strong national organization is to have strong State organization with everyone putting some money into the pot, so to speak. We have tried to get our own enabling legislation. Three times Illinois has had varying degrees of success. We got it to the Governor twice and it stopped in the Senate the last time-for several reasonssince our early interest in these bills, so that we can write our order and have a referendum and get going in this area. We have visions in the Midwest of getting our smaller States together, even along with Michigan, and working as an area movement, as well as supporting our national effort. 48-940-70- -2 Three years ago we started an effort to get Ohio, Indiana and Illinois into the organization to have one Administrative Secretary and one office and more members to the growers. But we were unable to do this because Indiana was the only one that had the ability to assess their growers, and the effort was dropped, although Indiana and Illinois stayed together for a year. Those are the basic reasons that Illinois is especially interested in getting these bills to amend the act approved. Mr. FOLEY. Thank you very much, Mr. Surgeon. We appreciate your statement. At this point the Chair would like to note that in addition to Mr. Goodling, the sponsors of H.R. 9736 are Mr. Miller of Ohio, Mr. Conte of Massachusetts and Mr. Burton of Utah. The identical bill is sponsored by Mr. Findley of Illinois, H.R. 10545. In addition to Mr. Goodling, the sponsors of H.R. 9737 are Mr. Miller of Ohio, Mr. Findley and Mr. Burton of Utah. Are there any questions? Mr. VIGORITO. No questions. Mr. GOODLING. No questions. Mr. MYERS. No questions. Mr. FOLEY. Thank you very much, Mr. Surgeon. Mr. SURGEON. Thank you. Mr. FOLEY. The Chair would also like to note that both the chairman and the ranking minority member, Mrs. May, come from the State of Washington, which is an apple producing State. Between our districts we divide the apple production in the State of Washington, so we can by nature, be favorable to legislation which encourages the effective and efficient marketing of apples. Mr. GOODLING. Mr. Chairman, may I make an observation? Mr. GOODLING. It will be that. I note in Mr. Surgeon's remarks, when he was telling something of the value of apples, he said they improve your disposition. I was wondering if it might not be in order to have apples on the floor of the House at all times. Mr. FOLEY. Washington will match Pennsylvania apple for apple. Mrs. MAY. We had some Washington apples in the cloakroom the other day produced by our Washington applegrowers. I detected an improvement in the general atmosphere of the personalities of our colleagues. Mr. FOLEY. An improvement in both disposition and their health. (The prepared statement of Mr. Surgeon and two letters from the American Farm Bureau Federation follow:) STATEMENT OF JOHN SURGEON, Fruit Grower, CHAIRMAN OF THE LEGISLATIVE COMMITTEE OF THE ILLINOIS HORTICULTURAL SOCIETY AND ILLINOIS FRUIT COUNCIL I am John Surgeon, an apple and peach grower from Illinois, and on the Legislative Committee of the Illinois Horticultural Society and the Illinois Fruit Council. In behalf of my state of Illinois, I strongly recommend the passage of H.R. 9736 and H.R. 9737. These bills would amend the Agricultural Marketing Agreement Act of 1937 to include our state, and to include paid advertising under the Act. They would enable marketing research and development programs to continue on an uninterrupted basis. |