Cost of Production 381 



N 



charges, the acre cost being little affected by the size of the 

 crop. Fixed costs include taxes, depreciation, insurance, 

 and interest on investment. Of these, interest on invest- 

 ment is by far the most important. This item alone 

 reaches $154 annually in the Wenatchee Valley, a cost 

 which is a good price for land in many sections. Western 

 New York had an interest cost an acre of only one-sixth 

 this amount. The high yields of the Wenatchee Valley, 

 however, tend to overcome this high interest charge. Fig- 

 ured on the bushel basis, the interest charge at Wenatchee 

 was 26 cents a bushel as compared with 10 cents a bushel 

 in New York state. This fixed cost has not increased in 

 most apple sections since 1914, while labor rates have ad- 

 vanced about 100 per cent and cost of material rose sharply 

 in 1920. 



Hood River, Oregon, has an annual acre interest charge 

 of $75 less than that for the Wenatchee Valley. Return- 

 ing to the interest cost a box, it is seen that Hood River is 

 charged with 25 cents a box as compared with only 26 

 cents for Wenatchee. This serves to show very emphati- 

 cally that high costs a box or barrel are to be considered 

 irrespective of fixed costs an acre, for yields directly de- 

 termine fixed cost a box or barrel. 



On the other hand, it is important to remember that any 

 saving in fixed cost is direct. This may be effected in the 

 judicious purchase of land. It is always poor economy 

 to grow apples on poor land, but at the same time orchards 

 are over-capitalized in many regions and the grower of 

 limited means will sometimes find his fixed cost so high 

 in a series of poor years that he will not be able to sur- 

 vive the hard times. It should be repeated that once these 

 fixed costs to an acre are established, they can not be low- 



