BARGAINING BY FRUIT AND VEGETABLE ASSOCIATIONS WITH PROCESSORS 



by 

 Go Alvin Carpenter* 



In many areas farmers producing vegetables for processing have joined 

 together into cooperative bargaining associations. The success of these 

 associations and others that may be organized depends upon the knowledge 

 and application of the theory and techniques involved in bargaining. 



This publication discusses why growers form bargaining associations and 

 then goes into the theory and techniques of bargaining that these associ- 

 ations may use to be effective a 



NEED FOR BARGAINING ASSOCIATIONS 



To start with, farmers growing vegetables for processing are faced -with 

 a different situation than those producing other agricultural commodities. 

 For example? they sell wheat and potatoes at the local market level under 

 more competitive conditions than milk or canning crops* There are more 

 buyers and outlets available . Also, wheat, being a commodity of small 

 bulk or weight, in relation to value, and not being perishable^ can be 

 transported long distance and stored for considerable periods of time. 

 The marketing season can thus be prolonged 



Products such as wheats butter, corn, wool and cotton are sold on what 

 might be termed national markets, and some of them through facilities 

 of the commodity exchanges are sold at or near a world-price level. When 

 such products are sold in a local market- prices are largely based on the 

 price as quoted In the central market less transportation and handling 

 charge s . 



In the selling of such commodities there Is usually sufficient competition 

 to enable the farmer to obtain a price that fairly well reflects the cen- 

 tral market prices Considerable market information is available and buyers 

 and sellers can be fairly equal in strength and in knowledge of the supply 

 and demand factor s« 



In contrast to this situation, farmers sell other farm products such as 

 canning peas, sugar beets, and milk in certain areas almost entirely on 

 a local market where there is no free play of competitive forces but 

 instead a very few or sometimes only one processor. The individual farmer 

 having such products for sale is under a competitive disadvantage. Canning 

 peas are bulky and perishablej they cannot be transported long distances 

 before being processed nor stored for any period of time. They must be 

 processed before they are in the form suitable for consumer acceptance. This 



Assistant Director of Extension, Utah State Agricultural College. 



