POOLING BY COOPERATIVE MARKETING ASSOCIATIONS 9 



period but which is marketed throughout a lon«rer period, is that 

 ^roup oi- association action has economic advantaL'cs over individuals 

 operatin*^ separately, for an association can hohl the pnxhict and 

 feed it into the distributini; channels more cllicicntly dui-in;r the 

 necessary carryin<; period than can a lar<:e ninnber of individuals 

 who operate separately. This requires that the niarlv('tin«r risk be 

 carried by the ^^-oup or association unless the association is able to 

 transfer certain elements of risk to other parties — which may be 

 done when the commodity is traded in upon an ori;anized exclian«;e 

 or when it is covered by insurance. 



In the case of fruits which are to be the raw material for subsequent 

 nianufacturin<^ processes, the adjustment of the length of the poolin<; 

 period on a basis similar to that of the cotton pools would be i-ather 

 ditlicult, because of the inherent characteristics of the raw material. 

 Fruits are subject to a de<j;ree of deterioration in the raw state which 

 makes it diflicult to arrive at probable future market values. If a 

 satisfactory daily, weekly, or monthly pool could be established, it 

 probably would be necessary to sell the raw product on a spot market, 

 either in total at the befrinnin^ of the season or by distributin<,' it in 

 smaller quantities from time to time as needed by processors. The 

 seller would assume the marketini; risk until the couimodity was sold, 

 and the I'uyer would assume it as soon as the i)urchase was consum- 

 mated. A buyer miirht purcha.se at the bejrinnin<,' of the season but, 

 because of the inherent characteristics of the conunodity, he would 

 buy at a price which would allow the producer a compensation for 

 assumin<; market risks and which would be somewhat lower than the 

 final average price that mi^i^ht be returned by the association's .sea- 

 sonal pool, in which risks and benefits were assumed by a ^roup of 

 j)roducers. 



On the other hand, individual growers who sell small lots from 

 time to time assume the marketinj^ risks individiuilly durin<r the 

 period for which they carry the product. If the ^nowers prefer, the 

 association's services to its memljers nuLdit be limited to <:ra(linir, 

 market-news information, adetjuate contact with the buyer, financial 

 assistance, and other services. In this ca.se the grower individually 

 would carry the important marketing risks. 



The nuinagement side of this problem is even more complicated, 

 because of the lack of any unihed control of the conunodity in |)lan- 

 ning the sales j)rogram. If a large perrentage or tonnage of (he com- 

 modity were dis|)osed of through the short-time pools, this would 

 defeat the association\s processing and meichiindising program. In 

 other words, the benefits that accrued from carrying, processing, and 

 merchandising the j)roduct would be jKis.sed on to private enter|)rise. 

 And what is j)eihaps e(iually, if not more imjjortant, in nianv cases 

 is the fact that the grower might gradually lo.se contac t with the 

 ultimate user of his product. 



AKKA TO UK INCI-l'DED IN A POOL 



The aim sought in including a laige area in one pool is to make the 

 pooling .system sutliciently comjjrehensive to enable a single business 

 unit (1) to control distribution to market and (2) to convert, or 



