TWENTY-EIGHTH FRUIT- GROWERS' CONVENTION. 



77 



tions came the negotiations, in the month of March of this year, for a 

 consolidation of interests. I have said that a good many people were 

 operating independently, and the Exchange was handling approximately 

 half the shipments. I shall not go into the details of these negotiations. 

 They lasted for days and nights, for weeks. They involved a great deal 

 of thought, consideration, deliberation, concession, and sinking of differ- 

 ences and trying to get together for the protection of the industry itself. 

 Some of these factors were speculative factors, some of them were people 

 not growers, but interested simply by reason of their investments, who 

 had been buyers and shippers and had been receiving on consignment, - 

 and so forth. All of these things had to be taken into account and some 

 basis reached by which the business could be transacted and nobody 

 forced out and nobody hurt. The result was the organization of the 

 California Fruit Agency, which is essentially and simply a marketing 

 medium, and that only. It has no power under its charter to buy fruit 

 or to speculate in any product whatsoever. Into this organization was 

 absorbed the Southern California Fruit Exchange, the principal ship- 

 pers and packers of fruit, and the growers if they chose to come into it. 

 In order to put this at the service of the growers, the parties formerly 

 operating independently of the Exchange immediately proceeded to 

 organize what they called the California Citrus Union, for the purpose 

 of single management of their packing operations. The shippers became 

 packers only. They put at the service of the growers their packing 

 facilities, charging them a flat figure for packing and selling. And this 

 figure — I think you will agree with me, as you probably know exactly 

 what it is — is materially less than the same packers and shippers were 

 previously charging the growers for transacting their business. This is 

 perhaps an important factor, but it is not the most important. It is 

 not so important to the grower that the expense should be reduced one 

 or two or three or four or five, or even ten cents a box on his product, 

 as that the market should be protected and that he should be able 

 reasonably to get the value of his product. That is of much more 

 importance. It was a matter of small consequence whether he paid 

 forty or fifty cents for the packing and selling, if there was no margin 

 over that. The important thing was that the markets be so steadied, if 

 possible, that he may have a margin of profit for his industry. 



Now, the object to be sought in this combination was not the profit 

 of the packer. It was to so control the distribution of the product as 

 to put no more fruit into any one market than it required and to leave 

 no market unsupplied. You can quite understand that the Exchange, 

 having been operating for years without any profit to anybody — I mean 

 by that in the shape of earnings — it was doing business at absolute cost, 

 for the growers, and in the nature of things could not change this basis, 

 so far as its growers were concerned, and therefore the interests of the 



