"This is not an exaggerated picture of the situation which obtained in 1913-15. Local pride said: 'We will never suffer our unparalleled fruit to be packed and sold on any such low standard as must be set to meet the needs of the growers in yonder valley over the Divide, where they have multitudes of pests which to us are happily unknown.' ,,, Gradually, a large degree of order has been brought out of this chaos. Between 1915 and 1925 many States enacted their first grading legislation for fruits and vegetables. In 1917 the Federal Department of Agriculture began recommending grading standards for fruits and vegetables, and the list of such standards has steadily lengthened ever since until now practically all that are grown on a commercial scale have been provided for. The establishment of the Federal inspection service at receiving markets in the same year and the extension of the service to shippers at shipping points in 1922 have necessarily exerted a constant pressure toward the use of well defined, practicable, and uniform grades. The present situation, therefore, represents a much closer approach toward uniformity than existed 25 years ago.1 10 Aside from a very few outstanding exceptions, State or Federal grades have been substituted for private grades sponsored by local groups. This has greatly facili 10 A very useful summary and analysis of State fruit and vegetable grading and labeling legislation is presented in Present Status of State Legislation in the United States As It Relates to the Standardization of Fresh Fruits and Vegetables, mimeographed publication of the Bureau of Agricultural Economics, U. S. Department of Agriculture, December 1938. A compilation of State laws governing the marketing of eggs may be found in Egg Legislation and Grades in the United States, compiled by a special committee of the National Association of Marketing Officials (mimeographed, Connecticut Department of Agriculture, State Office Building, Hartford, Conn., December 1935). tated trading and has made possible the development of specialized producing areas distant from market. But from the viewpoint of interstate trade, the nonuniformity that now exists is more serious than formerly. The competition for markets has led some States to make grading compulsory. Many producers have believed that if all produce shipped from their State were well graded according to a strict standard and were plainly marked according to grade, it would win a commanding position in the markets where it is sold. In some States the legislatures have accordingly enacted legislation requiring all produce to be graded according to the official State grades. It has then been deemed necessary to require produce shipped into the State to also be graded in accordance with these State standards in order to protect home-grown produce from competition with less well-graded produce from outside the State. Any State grade definitions or packing or marking requirements which differ in any way from those required in other States lead to some degree of interference with the flow of goods into that State. The degree of interference that may occur varies from State to State. In 1933, Ohio enenacted a law requiring packages of fresh fruits and vegetables to be marked with the grade according to United States standards or with the words "Growers Grade." In practice, any established State grade or private brand is permitted as a marking. The chief effect of the law is, therefore, to cause a great number of packages to be marked "Growers Grade" that would otherwise be offered for sale without any grade marking. The degree of interference caused by the Ohio law may be measured by the expense and trouble entailed in marking a large volume of containers with the words "Growers Grade." The legislature of the State of New York enacted in 1937 a law requiring all packages of fruits or vegetables shipped into the State to be marked according to United States grades. In this case the local grower in New York State was not required to mark the grade of his fruits and vegetables. Many growers in nearby States considered this as discrimination. The law was repealed in the 1938 session of the legislature, before active enforcement had begun. A Louisiana act, passed in 1934, requiring all farm products raised in the State to be graded and labeled in accordance with Federal standards before being shipped, whether to home markets or out-of-State markets, is particularly exacting with respect to produce shipped into the State. The State Market and Warehouse Commission is authorized "To prohibit the shipment into the State of Louisiana... any farm products, fruits, or vegetables and the offering for sale of same without the said farm products, fruits, or vegetables having first been inspected and classified according to the rules, ordinances, and regulations as adopted by the State Market and Warehouse Commission." 11 It is reported that Louisiana has been requiring certificates of inspection with shipments of potatoes out of Maine. This requirement has been easy to meet because the potato-producing areas in Maine are very important commercial are. s and inspectors are available in practically every area where potatoes are shipped in any quantity. It is also reported that the law has been administered with discretion and that care has been taken not to interfere seriously with interstate commerce. It is easy to see that a very serious handicap to out-of-State produce could be created by unwise regulations by the State board. An Indiana law, enacted in 1935, requires fresh fruits and vegetables sold or offered for sale within the State to be graded and labeled in accordance with Federal grades; or, if originating outside the State, with the grades of the State of origin, providing these are at least as strict as the Federal grades. The law further requires fruits and vegetables shipped into the State to be "accompanied by a certificate showing that such fruit or vegetables comply in all respects with the requirements of the State and Federal laws and the rules and regulations issued thereunder. . . ." No appropriation has 11 Louisiana, Laws of 1934, Act No. 223, sec. 2 (d). ever been made specifically for enforcement of the law, and at present it is a dead letter. In the four cases just mentioned, the threat to the flow of farm products has not materialized; but in some Western States substantial hindrances actually exist. Montana requires fruits and vegetables to be graded and labeled in accordance with its own grade standards. These are based on the Federal grades, but differ from them in several details. In the case of Washington apples, the official apple grades (excepting "Orchard Run") of that State are recognized by Montana. It is reported that Montana has been enforcing its official State grades by stopping all trucks entering the State with loads of fruits or vegetables. The produce is inspected and an inspection fee is charged, whether or not a FederalState inspection certificate accompanies the produce. If the produce is found not to be marked in accordance with the official grade designation (except in the case of Washington apples), it must be relabeled. From a neighboring State it is reported that: "... they (Montana) refuse to admit produce even when accompanied by Federal certificates covering the lot except after making inspection of their own for which they make a charge." An official in another neighboring State says: "It is my understanding that when a load of fruits or vegetables arrives at the Montana State line, even though they carry the inspection certificate of (our) State, issued under our joint Federal and State set-up, they must be again re-inspected and another charge made for the inspection by the Montana people." And again the lack of uniformity is stressed as follows: "On commodities such as peaches and cantaloupes, which are marked according to (our own) standards in this State, they (Montana) insist that the grades be marked according to U. S. Standards. This of course requires a duplication of the markings and causes considerable confusion to truckers hauling into (Montana)." The multiplicity of the barriers that would be put in the way of interstate trade, if every State tried seriously to impose its own grade standards upon all brought-in fruits and vegetables, can be glimpsed in the following quotation: "Oregon does not recognize Washington combination grades of potatoes which call for a minimum of 50 percent U. S. No. 1. Such shipments must be marked U. S. No. 2 if for shipment into Oregon. Montana and California do not recognize all of our Washington State apple grades or some of our combinations of these grades. Also our State does not have some of the grades for apples which are recognized in their own States. For instance, Montana recognizes a 'Cooker' grade which this State does not." California prescribes minimum standards for 30 different fruits and vegetables. Californiagrown fruits and vegetables that fail to meet these minmum standards may not be sold within the State, nor may they be shipped out. Similarly, out-of-State produce that fails to meet the standards is not permitted in California markets. The minimum standard for avocados is said to require such a high oil content that it would be impossible for Floridagrown avocados to meet it. The minimum standard for potatoes specifies freedom from hollow heart, whereas the Federal standard specifies only that potatoes, to be of No. 1 grade, must be free from damage caused by hollow heart; or to be of No. 2 grade, free from serious damage caused by hollow heart. According to a letter from a marketing official— "a lot of U. S. No. 1 potatoes might theoretically fail to meet the requirements of the (California) standardization law because of the presence of hollow heart. Some years ago several cars of Oregon U. S. No. 2 Russet potatoes were condemned in Los Angeles by the State standardization authorities and required to be resorted because of the presence of a degree of hollow heart which, while permitted in the U. S. No. 2 grade was not allowed by the State law." The greatest amount of trouble seems to arise over shipments of apples into the State from Washington. The Washington grade standard for apples does not take condition into account, whereas the California standard does. In addition, the California standard is more strict for some defects than the Washington standard, and vice versa. Very frequently, therefore, Washington apples brought into California have to be regraded and relabeled. California, like Montana, stops trucks at the border for inspection, and like Montana, does not recognize certification from other States. This causes considerable annoyance to shippers. The manager of a shipping association says: "If a car or truck of merchandise is inspected in (our State) and shipped to California, the fact that it is inspected in (our State) does not mean a thing if the California authorities decide to reinspect (the) same and in view of the fact that their State regulations are different from (ours) it is a simple matter to find cars or trucks out of grade which, in that case, always causes a loss to the grower or shipper." The State of Maine has set up a "Utility" grade for its potatoes which has met with disfavor in some States. For instance, the Pennsylvania Bureau of Markets recommended that consignees of these potatoes in Pennsylvania retag them as "Unclassified" when offering them for sale. The strict Pennsylvania law on marking potatoes is reported to have caused some difficulty to growers of New York when marketing in Pennsylvania. STANDARD CONTAINER ACTS.-Laws regulating the dimensions and other details with regard to the containers in which produce is shipped also afford some instances of nonuniformity. In passing, it may be noted that five States retain on their statute books standard barrel laws that are at variance with the Federal Standard Barrel Act. The Federal act, being a weights-and-measures law, applies to interstate and intrastate commerce alike. It therefore supersedes State legislation. The State laws are nevertheless worth attention as an example of the lack of uniformity that would exist were there no Federal law. As table 5 shows, there is a 129569°-396 Crates and boxes remain undefined by Federal action, and the lack of uniformity of State standards in this field is startling. For example, there are 15 different sizes of cantaloup crates defined by State standards, and of these 5 are defined according to inside length in one group of States and according to outside length in another. There are two slightly different sizes of "Standard flat", two slightly different sizes of "Standard crate", and three slightly different sizes of "Pony crate." Of apple boxes there are seven kinds, four of which are only slightly different from one of the three others. For example, in 10 States the standard apple box is 101⁄2 inches by 111⁄2 inches by 18 inches (inside measurement), but in Idaho it is 10%1⁄2 inches by 111⁄2 by 18%. Many similar examples could be cited, 12 As far as known, this lack of uniformity in 12 Federal and State legislation regulating the dimensions, etc., of containers is described in detail in a mimeographed publication of the U. S. Dept. Agr., Bur. Agr. Econ., entitled "Summary of Federal and State Laws Pertaining to Containers for Fruits and Vegetables," dated March 1938. Laws defining standard weights per bushel or prescribing the units of measurement to be used in lieu of standard weights are summarized in another mimeographed publication of the same Bureau, entitled "Synopsis of Federal and State Laws Relating to Legal or Standard Weights per Bushel and the Sale of Fruits and Vegetables." (In process.) State standards for containers has thus far not acted as a barrier to interstate commerce except in one instance because, except for that instance, State container standards are voluntary and are intended only for shipments out of the State. They are not applied to receiving markets. The exception occurred when Oregon made its berry-box standards compulsory for boxes shipped out of the State and California declared such boxes illegal for sale of berries within California. Here again, as in grading regulations, it is the combination of compulsory use of official standards with nonuniformity of standards among States which makes serious difficulty for interstate commerce. Closely allied to the standard-container laws are the standard-weights-and-measures laws. An interesting example of conflict between State laws occurred recently when the State of Pennsylvania prescribed standard dimensions for peck and bushel sacks to be used by growers in Pennsylvania when marketing their potatoes, and Ohio authorities refused to recognize these, because according to the Ohio law a bushel of potatoes means 60 pounds of potatoes, and a peck means 15 pounds. The two laws are in conflict because in one the bushel is defined in terms of dry measure, and in the other it is defined in terms of weight. Two States-Utah and Montana-require fruits and vegetables shipped into the State to be in new, clean containers. Arizona requires that they be in new or clean containers and requires them to be accompanied by an inspection certificate. There is considerable discussion at present regarding the possible dangers in the repeated use of containers. It has been the usual practice for nearby produce to be hauled to market in old boxes, crates, and baskets; and the regulations of Montana, Utah, and Arizona represent a departure from customary methods. In the case of Montana, at least, the regulations concerning the use of new boxes have aroused criticism. An official of a neighboring State complains in a letter that Montana's "interpretation of new boxes at times has been . . . unfair. Recently they held that boxes that had held apples loose in storage and that had been used for picking were not new boxes." In selecting a number of examples of nonuniformity, the purpose has been not to criticize the States involved, but to call attention to concrete situations that actually exist. These examples demonstrate that nonuniformity can create serious handicaps to interstate trade. On pages 83-84, possible ways are discussed in which a greater degree of uniformity might be brought about without losing the benefits of legislation regarding grading, marking, and packaging. CHOICE OF REQUIREMENTS When producer groups turn to their State to set up and enforce grade standards they are naturally interested in having standards set up that will give them the greatest advantage possible over competing products. Even without any deliberate intention to favor their own product, local groups would tend to think of a proper standard as one that contained strict requirements for those characteristics in which the local product excels and less stringent requirements for characteristics in which the local product is less outstanding. In a few cases where there is an important group of producers in a State which also imports substantial quantities of the product they raise, a practice has grown up that must be regarded even more seriously than the existence of nonuniformity. This is the more or less deliberate use of marketing regulations to hinder out-ofState products from reaching State markets, or to place them at a disadvantage in the home markets. This point of view is reflected in the words of one official as follows: "Before we started to 'tighten up', and have border inspection stations for fruits, vegetables and other agricultural products, surrounding States were using (our State) as a dumping ground for their inferior products, at a cut price, very much to the disadvantage of (our growers). ... "One example is the fact that (an adjoining State), a few years ago, and especially during years of high prices, would grade its potatoes and truck their culls and No. 2's into (out State), and ship their No. 1's to Eastern markets, with the result that the low price they made on these culls completely demoralized the market for (our) growers. The same thing would be true in regard to our apple producers. . . if the practice were not checked. (Two neighboring States) would flood our State with cull apples, depressing our apple market. Some years ago this made little difference, as our . . . apples, of the better grade, found a ready market in New York, at a profitable price. Gradually, however, we have lost this market to Eastern growers, who have a cheaper freight rate, with the result that we are compelled to find a local market." CHOICE OF GRADE SPECIFICATIONS.-One way of using grading legislation to place out-of-State products at a disadvantage is to set up requirements for the top grade or grades that can be met only by produce raised within the State. In 1936, the Rhode Island Bureau of Markets, under authority of the State general farm products grading law, established a grade for eggs to be known as "Rhode Island Special Eggs." Not only must eggs meet the strictest candling tests for quality before they may be sold as "Rhode Island Specials," but they must have been laid in Rhode Island. Eggs meeting the same quality tests cannot be sold as "Rhode Island Specials" if they were laid outside the State. The State regulations do not prohibit the sale of eggs graded according to the Federal grades, under which eggs laid outside the State and meeting the same candling requirements as "Rhode Island Specials" could be sold as U. S. Specials. Nevertheless, Federal egg grades are not in common use in Rhode Island. The Bureau of Markets says: 13 "In Rhode Island we have three grades of eggs; 'Rhode Island Specials', Fresh eggs that are not fresh and eggs * ... 18 Pp. 19 and 25, Rhode Island Egg Quality Program, Bureau of Markets, Bull. No. 2. Providence, R. I., December 1936. |