provided a penalty of one dollar and costs for each barrel of apples sold or 
offered for sale if it was marked as to grade and failed to meet the requirements 
specified in the act. Packing of apples under the requirements of this act 
was voluntary, and the quantity so packed was insignificant. 
Congressional action in 1913 marked the real beginning of concentrated 
effort by the Federal Government to aid the fruit and vegetable industry as a 
whole in the marketing of their products. In that year Congress made the 
first appropriation for conducting studies in the marketing of farm products. 
An appropriation of $50,000 was made to enable the Secretary of Agriculture 
to diffuse among the people useful information on subjects connected with 
the marketing and distribution of farm products. Thus, the original authority 
for conducting investigations with a view to establishing standards came about 
through the passage of the regular agricultural appropriation bill and not 
through an organic act, as may be commonly supposed. This procedure has 
never been changed and each year since the item first appeared in the annual 
appropriation act, a similar provision has been approved. 
Shortly after the first appropriation was made, the Secretary of Agriculture 
created the Office of Markets to carry out the work authorized by this pro- 
vision. Workers were soon assigned to make field investigations, with a view 
to eventually establishing U. S. standards. During the first 2 years major 
efforts in this direction were devoted to potatoes, tomatoes, strawberries, 
cantaloups, and peaches. 
In 1915, the need for national standards for fruits and vegetables was greatly 
emphasized by the inauguration of a telegraphic market news service by the 
Department of Agriculture. It soon became obvious that unless prices quoted 
were based upon products of comparable quality, no particular significance 
could be attached to price variations in the different markets. Staff technicians, 
therefore, redoubled their efforts in field investigational work with a view to 
establishing practical grades for the country as a whole. 
Progress in formulating standards during the first few years was naturally 
slow. Investigators were obliged to visit all commercial producing sections 
where standards for any particular crop were under consideration. Countless 
numbers of meetings and conferences had to be held and there were many 
differences of opinion to iron out between growers, shippers, and receivers 
before standards suitable to the whole country could be formulated. 
FIRST UNITED STATES GRADES ISSUED FOR POTATOES 
At the time the United States entered World War I, the marketing of 
potatoes by grade was thought to be practicable. As it happened, the choice 
of potatoes as the first product for which grades were to be established, was a 
fortunate one. The 1917 crop was large and the Federal Reserve Board 
authorized its member banks to accept warehouse receipts as collateral security 
for loans for potatoes that had been properly packed, stored, and insured. 
The Board notified the United States Food Administration that since potatoes 
constitute a readily marketable nonperishable stable, they came within the 
regulation relating to commodity paper. Following this action of the Federal 
Reserve Board, the United States Department of Agriculture, and the United 
States Food Administration jointly recommended United States grades for 
potatoes, the use of which became mandatory on January 31, 1918, as far as the 
licensees of the latter organization were concerned. This ruling was not lifted 
until after the signing of the Armistice. 
709906°— 46——2 
