UNIVERSITY OF CALIFORNIA COLLEGE OF AGRICULTURE AGRICULTURAL EXPERIMENT STATION BERKELEY, CALIFORNIA SERIES ON CALIFORNIA CROPS AND PRICES OLIVES H. R. WELLMAN BULLETIN 510 MARCH, 1931 CONTRIBUTION FROM THE GIANNINI FOUNDATION OF AGRICULTURAL ECONOMICS UNIVERSITY OF CALIFORNIA PRINTING OFFICE BERKELEY, CALIFORNIA Digitized by the Internet Archive in 2012 with funding from University of California, Davis Libraries http://www.archive.org/details/olives510well OLIVES 1 H. E. WELLMAN2 SUMMARY The commercial production of olives in the United States is vir- tually confined to California. During the past decade there has been a substantial increase in the commercial production of olives in this state, rising from an average of 11,700 tons in 1921-1923 to an average of 19,500 tons in 1927-29. During the next few years, how- ever, only a small further increase in production is expected unless, of course, yields per acre are materially increased through better care of the orchards. Plantings of olives during recent years have been small. Most of the acreage of Mission and Manzanillo olives is now at about the age of full bearing. On the other hand, only about one-third of the acreage of large-type olives — Sevillano, Ascolano, and Barouni — is in full bearing. Practically all of the increase in total production during the next few years will, therefore, be in the large- type olives, which are used mainly for canning. During the three years 1926-27 to 1929-30 the combined pack of Sevillano, Ascolano, and Barouni olives constituted about 15 per cent of the total pack. During the past four years an average of 58 per cent of the com- mercial production of olives in the state was canned, 36 per cent pressed for oil, and 6 per cent shipped fresh and dried. California produces only a very small part of the edible olive oil used in this country. During* the past nine years about 98 per cent of the edible oil consumed in the United States was imported, mainly from Italy, Spain, and France. Prices of edible olive oil, although much above prices of other oils such as cottonseed, coconut, and corn, have at no time in the past decade been sufficiently high to return to California producers of oil olives. a satisfactory price. The low price received for oil olives, which has averaged $34 a ton during the past nine years, has been one of the important reasons for the generally low returns to growers of Mission and Manzanillo olives. At the present time there are no definite indications which point toward materially higher prices for oil olives during the next few 1 Paper No. 16 The Giannini Foundation of Agricultural Economies. 2 Extension Specialist in Agricultural Economics and Associate on the Giannini Foundation. 4 University of California — Experiment Station years. World production of olive oil has been increasing" rapidly, and there is no evidence of a pronounced downward trend in the imme- diate future. The United States has long been the most important world market for olive oil. Another factor of importance is the com- petition between edible olive oil and other edible oils, such as corn and cottonseed, for salad dressing and cooking. A materially wider margin between the prices of olive oil and other oils than that which has prevailed in the past would tend to cause the lower-priced oils to be substituted for olive oil. During the past decade there has been a substantial increase in the shipments of canned ripe olives, from an average of 304,000 cases a year between 1920-21 and 1922-23, to an average of 638,000 cases a year between 1926-27 and 1928-29, which is an average increase of 55,000 cases a year. This upward trend in shipments, however, did not result in a downward trend in prices, which is evidence that the trend of demand for canned ripe olives, as measured by quantity, has increased at the rate of about 55,000 cases a year. From 1926-27 to 1928-29 the packs of canned ripe olives increased even faster than shipments, and consequently there was a gradual accumulation of stocks on hand, rising from 105,000 cases on Novem- ber 1, 1927, to 260,000 cases on November 1, 1929. Although the pack in the crop year of 1929-30 amounted to only 635,000 cases or 230,000 cases less than the 1928-29 pack, shipments in 1929-30 amounted to only 588,000 cases, so that the carryover on November 1, 1930, was 47,000 cases larger than in the previous year. This large carryover of 307,000 cases on November 1, 1930, is the most serious factor in the present situation. With prices and packs equal to the average of the past three years it will take about five years to reduce the carryover to a nominal amount if the future increase in demand is no more rapid than it has been on the average during the past decade. However, if the packs during the next few years should be small or if the demand should increase more rapidly than in the past, the carryover could be disposed of in a much shorter time. By utilizing a larger proportion of the olives for oil the amount of olives canned could be materially reduced. This would tend to increase the prices of canning olives without causing a decrease in the prices of oil olives because California production of olive oil is such a small part of the national supply. Until the present large carry- over is reduced, such a procedure would be of distinct benefit to the industry. It cannot be accomplished, however, unless it is undertaken as an industry program and participated in by all factors in the industry. Bul. 510] Olives 5 The possibility of expanding the markets for canned ripe olives is apparently very great. At the present time approximately 70 per cent of the canned ripe olives are consumed in the Pacific Coast states, which contain only 6.7 per cent of the nation's population. For the past year the olive industry has been carrying on a program designed to introduce canned ripe olives into the markets not now familiar with them. This program if carried on for a period of years offers strong possibilities of materially increasing the demand for canned ripe olives. That the demand can be expanded fast enough to relieve immediately the present situation, however, is doubtful. The available information on business conditions and employment in this country indicates that the 1930-31 pack will be marketed under conditions materially less favorable than the average of the past three years. The recent decreased demand for canned ripe olives, however, is likely to be only temporary. There are no fundamental factors yet apparent which would indicate that the upward trend in demand, which occurred during the past decade, will not continue for some years at least. Indications are that the future trend of demand over a period of years will increase faster than the future trend of supply. It is, of course, impossible to determine exactly when the demand will exceed the supply at the present level of prices. The probability is, however, that such a condition will occur within the next four or five years. Prices may then be expected to improve. Each rise in prices, however, will tend to bring into operation two sets of forces which will retard a further rise in prices. An increase in prices will tend to reduce consumption in the established markets and at the same time, by encouraging the olive growers to take better care of their orchards, will tend to increase the supply. Judging from the information now available it appears that there will be a gradual upward trend in prices of olives beginning within the next four or five years. While several things may happen which would hasten or delay this expected improvement in prices, only a very unusual condition could prevent average returns to growers from being materially higher in from seven to ten years hence than the level of recent years. THE GENERAL SITUATION Acreage and Production, California. — The region in which olives have been grown successfully for commercial production in the United States is practically limited to California. According to the Four- teenth Census of the United States there were 1,613,000 olive trees in (i University of California — Experiment Station this country in 1920, of which 99 per cent were in California. The only other state in which olives are produced on a commercial basis is Arizona. During recent years the olive industry in that state has been on the decline. In California there has been a substantial increase in the produc- tion of olives during the past decade. The annual production from 1921 to 1929 is shown in figure 1. During the three years 1921-1923 COMMERCIAL PRODUCTION OF OLIVES IN CALIFORNIA, 1921-1929 1921 1922 1923 1924 1925 1926 1927 Crop year (beginning in the year given) 1928 1929 Fig. 1. — Between 1921-1923 and 1927-1929 the commercial production of olives in California increased 67 per cent. Data for years 1921-1924 from California Crop Reporting Service, for years 1926-1929 from table 3. the average annual production amounted to 11,700 tons as against an average of 19,500 tons during the three years 1927-1929, an increase of 7,800 tons, or 67 per cent. This increase in production was chiefly the result of heavy plantings during the period 1915-1920. An olive tree does not come into commercial bearing until six or seven years of age and does not reach full bearing until twelve or fifteen years of age. The number of trees of nonbearing age in 1920 amounted to 687,000 as against Bul. 510] Olives 122,000 in 1910 (table 1). Of the total number of trees in 1920, 43 per cent were of nonbearing age, whereas in 1910 only 13 per cent were of nonbearing age. TABLE 1 Number of Olive Trees in California, 1910 and 1920 1910 1920 Bearing age Nonbearing age Total Bearing age Nonbearing age Total State 1,000 trees 836 177 129 443 87 1,000 trees 122 23 45 48 6 1,000 trees 958 200 174 491 93 1 ,000 trees 911 246 282 344 39 1,000 trees 687 295 292 93 7 1 ,000 trees 1,598 Sacramento Valley San Joaquin Valley Southern California 541 574 437 46 The number of olive trees per acre ranges from 40 to 80. The average number of trees per acre for the state is about 60. Source of data: U. S. Dept. Commerce. Census of the United States, 1910 and 1920. Most of the plantings of olives since 1915 have been in the Sacra- mento and San Joaquin valleys. In 1920 these two valleys contained 86 per cent of the total number of trees of nonbearing age, while southern California contained only 14 per cent. At the present time southern California is only of minor impor- tance in the production of olives. During the three years 1927-1929 less than 10 per cent of the total production in the state was produced in that section. Between 1910 and 1920 there was a decrease of over 20 per cent in the bearing acreage of olives in southern California. Since 1920 there has been a further decline. Low prices, irregular yields, and subdivision have resulted in neglect, abandonment, or removal of many orchards. TABLE 2 Estimated Olive Acreage, Sacramento and San Joaquin Valleys, 1930 Mission Manzanillo Sevillano Ascolano Others Total acres 8,540 3,660 300 4,580 5,950 3,820 2,130 14,490 acres 1,345 125 1,220 5,150 3,730 1,420 6,495 acres 2,100 120 1,680 300 750 620 130 2,850 acres 170 55 120 740 330 410 915 acres 410 110 20 280 200 60 140 610 acres 12,570 4 070 Butte 2,000 6,500 12,790 Tulare 8,560 4,230 25,360 Total north of Tehacbapi Source of data: Surveys made by the California Crop Reporting Service, Farm Advisors and canners. s University of California — Experiment Station The estimated acreage of olives in the Sacramento and San Joaquin valleys is segregated by varieties in table 2. Of the total acreage north of the Tehachapi 57 per cent is planted to Missions, 26 per cent to Manzanillos, 11 per cent to Sevillanos, and 4 per cent to Aseolanos. Although the plantings of olives during recent years have been very small, there will probably be a further small increase in the total production of olives in the state due to the increase in ag*e of the trees. A considerable proportion of the acreage of large-type olives is not in full bearing. In Tehama County over one-third of the Sevillano acreage is nonbearing, while an additional third has not reached the age of full bearing. In other sections of the state most of the acreage of large-type olives consists of grafts on Mission and Manzanillo stock. These grafts are still young. Utilization of California Olives. — California olives are used pri- marily for canning and oil, although some are dried and others are shipped fresh to eastern markets. The estimated quantities used in these ways during the four years of 1926-27 to 1929-30 are given in table 3. Of the average annual production of 17,700 tons during this four-year period, 58 per cent were canned, 36 per cent pressed for oil, and 6 per cent shipped fresh and dried. TABLE 3 Utilization of the California Olive Crops, 1926-1929 Pressed Shipped fresh Crop year Canned for oil and dried Total Nov. to Oct. 1 2 3 4 tons tons tons tons 1926-27 7,200 3,900 1,100 12,200 1927-28 11,200 6,500 900 18,600 1928-29 13,300 6,000 1,200 20,500 1929-30 9,800 8,800 900 19,500 Sources of data: Col. 1: Canned pack figures of table 4 converted to tons on the basis of 65 cases per ton. Col. 2: Olive-oil-production figures of table 12 converted to tons, using the figures given in table 16, col. 2. Col. 3: Estimated from records of canners. The large-type olives — Sevillano, Ascolano, and Barouni — are used almost entirely for canning. The oil content of these varieties is so small that it does not pay to press for oil even the small sizes and culls. On the other hand, the small sizes and culls of the Mission and Manzanillo varieties are used mainly for oil, and except with canners having special markets for small canned ripe olives, the general prac- tice is to can only the olives of medium size or larger. Bul, 510] Olives CANNED OLIVES The pack of canned ripe olives in California for the crop years of 1919-20 to 1929-30 is shown in figure 2. During" the first part of this CANNED EIPE OLIVE PACK, CALIFORNIA, 1919-20 TO 1929-30 U) o o o in lO to «H CM o o CO lO o t- CM to -* «* c- CO Fig. 2. -During the past decade there has been a substantial increase in the pack of canned ripe olives in California. Data from the California Olive Association. period there was a steady increase in the pack from 150,000 cases in 1920-21 to 675,000 cases in 1923-24. The very large pack in 1923-24 was the result of an unusually large crop. In July, 1924, there was an outbreak of botulinus which caused a very great decrease in the demand for canned ripe olives. Prices broke severely and the carry- over at the end of the year was undoubtedly very large. This together with the very small crop in 1924-25 resulted in a pack in that year of only 187,000 cases. During the next four years the pack increased rapidly, reaching a total of 865,000 cases in 1928-29. In 1929-30 for the first time in five years the pack was smaller than in the preceding year. The very rapid increase in the pack from 1926-27 to 1928-29 was not accompanied by an equally rapid increase in shipments. In figure 10 University of California — Experiment Station 3 the black portion of the bars represents the pack, the single cross- hatched portion the carryover from the previous year's pack, the white portion the quantity in hands of packers at the end of the year, CALIFORNIA EIPE OLIVE PACK, CARRYOVER, AND CONSUMPTION 1,000 800 3 600 CARRYOVER FROM PREVIOUS YEAR □ NOT CONSUMED AT END OF YEAR B PACK ES SHIPMENTS 400 200 Average 1921-1923 Crop year (ending in the year given) Fig. 3. — The trend of shipments of canned ripe olives has been increasing at the rate of about 55,000 cases a year. Data from table 4. TABLE 4 Production, Carryover,, and Shipments of Canned Ripe Olives, 1926-1927 to 1929-30 Crop year Nov. to Oct. Pack Carryover from previous year Available for shipment Carryover into following year Shipments 1926-27 1,000 cases 470 728 865 635 1,000 cases 110 105 204 260 1,000 cases 580 833 1,069 895 1,000 cases 105 204 260 307 1,000 cases 475 629 809 588 1927-28 1928-29 .... 1929-30 Source of data: California Olive Association. and the double cross-hatched portion the shipments. On November 1, 1927, the carryover amounted to 105,000 cases, on November 1, 1929, to 260,000 cases, and on November 1, 1930, to 307,000 cases. Bul, 510] Olives 11 Prior to 1926 data on carryover are not available and consequently it is impossible to calculate the actual shipments for the earlier years. The average shipments for the periods 1920-21 to 1922-23 and 1923- 24 to 1925-26, however, can be approximated. These approximations are represented by the wide double cross-hatched bars in figure 3. In determining the trend of shipments during the past decade the period 1923-24 to 1925-26 should be omitted because of the abnormal conditions prevailing at that time. The average annual shipments during the years 1920-21 to 1922-23 and 1926-27 to 1928-29, how- ever, provide a satisfactory basis for estimating the trend of con- sumption. Between the two periods mentioned shipments increased from an average of 304,000 cases a year to an average of 638,000 cases a year, an increase of 334,000 cases in six years, which is an annual average increase of about 55,000 cases a year. It is of considerable significance that this increase in the trend of shipments was not the result of a downward trend of prices. Con- fidential records of packers indicate that the prices received during the three years 1926-27 to 1928-29 averaged about the same as those received during the three years 1920-21 to 1922-23. This is evidence that there has been a real increase in the demand for canned ripe olives, and measured by quantity the trend of demand has increased at the rate of 55,000 cases a year. The increase in the actual shipments between 1926-27 and 1928-29 averaged about 167,000 cases a year, which is three times as large as the estimated increase in the trend of shipments. The large increase in the actual shipments was the result of a number of factors. In 1926-27 the markets for canned ripe olives were still suffering from the botulinus scare and consequently, shipments in that year were about 100,000 cases below normal. The following year, however, the market had fully recovered and the actual shipments practically coincided with the estimated trend. In 1928-29 actual shipments exceeded the estimated trend by 120,000 cases. This was in part the result of excellent business conditions and in part the result of lower prices of Sevillano olives. In 1929-30 shipments were about 156,000 cases below normal and prices received by packers were lower than in 1928-29. The generally unsatisfactory market conditions for ripe olives in 1930 was largely the result of depressed business conditions and unemployment. The Federal Reserve Board index of factory employ- ment in the United States declined steadily from 103 in September, 1929, to 83 in August, 1930. The low level of buying power of con- sumers resulted in a considerable slackening in the demand for canned 12 University of California — Experiment Station ripe olives. While some improvement in business conditions and employment may be expected during- 1931, it is not likely that condi- tions will be as favorable for selling the 1930-31 pack as they were during- the 1927-28 and 1928-29 marketing seasons. Although there has been a temporary decline in the demand for canned ripe olives, there is no reason for believing that the trend of demand during the coming years will not continue to rise. How fast it will rise will be determined by many factors which cannot now be measured or foreseen. If the future trend of demand does not rise more rapidly than in the past, however, it will be several years before prices can be expected to improve, unless of course the packs are materially below the average of the past three years. During the three years of 1927-28 to 1929-30 the packs averaged 740,000 cases a year, of which 630,000 cases were Mission and Manzanillo olives and 110,000 cases were large-type olives. With the level of prices to growers that prevailed during recent years no material change in the supply of Mission and Manzanillo olives available for canning is expected. On the other hand, there will probably be an increase in the production of large-type olives of about 70 per cent, or about 80,000 cases, when the present acreage comes into full bearing five to seven years hence. If this prospective increase in supply were the only depressing factor in the situation, however, prices could be expected to improve quickly because the trend of demand is rising at a more rapid rate. A much more serious factor is the carryover on November 1, 1930, of 307,000 cases. With the trend of demand increasing at the rate of 55,000 cases a year it will take about five years for the increase in demand by itself to reduce the carryover to a nominal amount. The carryover can, of course, be reduced to a nominal amount in a much shorter time if the packs should be materially below the average of the past three years or if the demand should increase at a faster rate than it has during the past decade. Even with the total production of olives in this state during" the next few years equal to or greater than the average production of the past three years, the amount of olives canned could be reduced pro- vided the industry would agree to do so. The returns to growers for olives pressed for oil, while much below the cost of production, are con- siderably above the cost of picking' and hauling. Consequently, the manufacture of olive oil offers an outlet for surplus olives of the Mission and Manzanillo varieties. Doubling or even trebling of the olive oil manufactured in this state would have but little influence on the price received because California production constitutes such Bul. 510] Olives 13 a small proportion of the total quantity of olive oil consumed in this country. Thus by utilizing' a larger proportion of the crop for oil, the price of canning olives could be increased without resulting in a corresponding decrease in the price of oil olives. Until the present carryover is reduced such a procedure would be of distinct benefit to the industry. It cannot be accomplished, however, unless it is under- taken as an industry program and participated in by all factors in the industry. Even though the packs should average somewhat larger than those of the past three years, there is still the possibility, but not the cer- tainty, that prices might improve within the next two or three years on account of a more rapid increase in demand than that which occurred during the past decade. For the past year the olive industry has been carrying on a program designed to introduce canned ripe olives into markets not now familiar with them. Records of several large packers show that during the four years 1926 to 1929 approxi- mately 70 per cent of the canned ripe olives were consumed in the Pacific Coast states and nearly all of the remainder in eastern mar- kets by people of southern European origin. It is evident, therefore, that the possibility of expanding the market for canned ripe olives is very great. That the market can be expanded sufficiently to absorb the excessive carryover within the next year or two without the expenditure of a very large amount of money, however, is much less certain. TABLE 5 Pack of California Canned Ripe Olives by Sizes, 1929-30 Size Cases Per cent of total Small and midgets 179,882 156,502 111,502 48,758 27,155 19,596 22,874 20,643 586,912 30.7 Medium 26.7 Large Extra large 19.0 8.3 Mammoth Giant Jumbo 4.6 3 3 3 9 3 5 Total* 100 *Does not include 48,000 cases which were not segregated by s. Source of data: California Olive Association. Sizes of Olives. — The size distribution of the 1929-30 pack of ripe olives is shown in table 5. In that year 30.7 per cent of the pack con- sisted of small-size olives, 26.7 per cent was of Medium size, 31.9 per 14 University of California — Experiment Station cent Large to Mammoth, and 10.7 per cent Giants and larger. Similar data on the pack by sizes of olives are not available for the earlier years. Records of several large packers, however, indicate that an unusually large proportion of the small sizes were canned in 1929-30. The size-grades of canned ripe olives established by the California Olive Association in 1925 are as follows: 3 Average number of Name of size-grade olives per pound Medium 113 Large 98 Extra large 82 Mammoth 70 Giant 60 Jumbo 50 Colossal 40 All olives smaller than medium are designated as " Seconds." Small olives are packed primarily for sale to people of southern European origin. In order to compete with imported ripe olives, which are largely consumed by these people, it is necessary to sell domestic canned ripe olives at low prices. As long as the sale of small olives is confined to this class of trade it provides an outlet for additional canned olives at prices somewhat higher to growers than could be obtained for oil olives, and does not materially affect the prices of the larger sizes. However, when small olives are offered to the trade which also buys the larger olives, it tends to reduce the quantity of larger olives that can be sold. If all of the small olives that are available for canning were canned, it is probable that the price to growers for small olives would be below that paid for oil olives and in addition the prices of the larger sizes would be reduced. Mission and Manzanillo olives seldom run larger than the Mam- moth size, while less than one-fourth of the Ascolano olives and almost none of the Sevillano olives smaller than Giants are canned. The size distribution of Mission and Manzanillo olives for the years 1926-27 to 1929-30 is given in table 6. On the average 3 per cent of the total crop delivered has been Mammoth, 11 per cent Extra Large, 19 per cent Large, 20 per cent Medium, and 47 per cent Small and oil olives. Data on sizes for Sevillano olives, the most important of the large- type olives, are given in table 7. During the four years 1926-27 to 3 Recently some packers have adopted three size-grades for Mission and Man- zanillo olives and two size-grades for large-type olives, thus reducing the number of size-grades from seven to five. But, 510] Olives 15 1929-30 the average size of the Sevillano olives used for canning" was 43 per cent Colossal, 38 per cent Jumbo, and 19 per cent Giant. TABLE 6 Estimated Percentages of Sizes of Mission and Manzanillo Olive Crops, 1926-27 to 1929-30 Year Mammoth Extra large Large Medium Small and oil Total 1926-27. .. per cent 3 5 2 1 3 per cent 18 12 10 4 11 per cent 23 20 23 13 19 per cent 21 15 21 21 20 per cent 35 48 44 61 47 per cent 100 1927-28 100 1928-29 100 1929-30 .... 100 Average 1926-27 to 1929-30 .... 100 Source of data: Compiled from records of canners. TABLE 7 Estimated Percentages of Sizes of Sevillano Olives Canned 1926-27 to 1929-30 Year Colossal Jumbo Giant Total 1926-27 per cent 61 37 40 33 43 per cent 27 46 44 36 38 per cent 12 17 16 31 19 per cent 100 1927-28 1928-29 100 100 1929-30 100 Average 1926- 27 to 1929-30 100 Source of data: Compiled from records of canners. TABLE 8 Average Prices per Ton Paid to Growers for Mission and Manzanillo Olives, 1921-22 to 1929-30 Year Mammoth Extra large Large Medium Small and oil 1921-22 1922-23 dollars 225 230 225 190 185 215 215 210 210 dollars 160 170 165 145 135 155 155 150 150 dollars 100 115 110 80 85 105 105 115 110 dollars 60 70 65 50 60 60 65 75 70 dollars 36 40 1923-24 1924-25 34 39 1925-26 38 1926-27 40 1927-28 35 1928-29 1929-30 40 38 Source of data: Compiled from records of canners. 16 University of California — Experiment Station Prices Paid to Growers. — Prices of Mission and Manzanillo olives for the years 1921-22 to 1929-30 are given in table 8. During* the four years 1926-27 to 1929-30 growers received an average price of $213 a ton for Mammoth, $153 a ton for Extra Large, $109 a ton for Large, $68 a ton for Medium and $38 a ton for small and oil olives. As shown in table 6, only a small proportion of the crop consists of Mammoth and Extra Large olives which bring high prices, while a large pro- portion of the crop consists of small and oil olives which bring low prices. Consequently, the price per ton for all Mission and Manza- nillo olives has been low, averaging only $75 a ton during the past four years. Sevillano olives have brought much higher prices per ton than Mission and Manzanillo. The prices paid to growers for the years from 1921-22 to 1929-30 are given in table 9. During the past two years prices per ton have averaged for Colossal $305, for Jumbo $125, TABLE 9 Average Prices per Ton Paid to Growers for Sevillano Olives, 1921-22 to 1929-30 Year Colossal Jumbo Giant 1921-22 dollars 325 350 400 400 410 410 410 305 305 dollars 220 225 250 250 225 225 225 125 125 dollars 100 1922-23 100 1923-24 110 1924-25 110 1925-26... 110 1926-27 110 1927-28 110 1928-29 60 1929-30 60 Source of data: Compiled from records of canners. and for Giant $60. The average price for these three sizes of Sevil- lanos has been $190 a ton, a distinct contrast to the average price of $75 a ton for all sizes Missions and Manzanillos. However, growers receive no returns for cull Sevillano olives. Prior to 1928-29 prices of Sevillano olives were considerably higher than they have been for the past two years, as is shown in table 9. The rapidly increasing production of Sevillano olives resulted in a reduction in their prices of $105 a ton for Colossal, $100 a ton for Jumbo, and $50 a ton for Giant. This large reduction in the price of Sevillano olives is probably, in part, responsible for a small decline in the prices of Mammoth and Extra Large Mission and Manzanillo Bul, 510] Olives 17 olives (see table 8). Sevilla.no olives compete more with the larger sizes of Mission and Manzanillo olives than they do with the smaller sizes. United States Imports of Olives. — Importations of olives into the United States during the three years 1927-1929 average 7,665,000 gallons as against an average of 6,343,000 gallons during the previous three years, an increase of 21 per cent. Judging from the import valuations this increase in supply did not result in a decrease in price. The average import price during the three years 1924-1926 was 71 cents a gallon, while during the three years 1927-1929 the average import price was 72 cents a gallon. It is probable that the demand for imported as well as domestic olives was abnormally low during the three years 1924-1926 and that the increase in demand between 1924-1926 and 1927-1929 largely reflects a recovery rather than a long-time upward trend. Since 1927 there is little evidence that there has been further increase in demand. The increase in imports during the past three years resulted in lower prices. In 1927 the average import price was 85 cents a gallon, in 1928, 69 cents a gallon, and in 1929, 61 cents a gallon. During the three years 1927-1929 approximately 89 per cent of the total United States imports of olives came from Spain, about 7 per cent from Italy, and about 3 per cent from Greece. TABLE 10 United States Imports of Olives for Consumption, 1924-1929 Calendar year Green in brine Pitted and stuffed Ripe in brine Ripe dried Total 1924 1925 gallons 3,903,694 2,815,758 3,077,108 3,160,191 4,793,202 4,849,539 gallons 1,858,339 1,567,027 2,040,107 1,894,784 2,474,416 2,500,767 gallons 1,620,641 1,231,630 756,597 146,896 237,716 311,066 gallons* 31,845 103,351 22,879 813,471 853,875 958,628 gallons 7,414,519 5,717,766 5,896,691 6,015,342 8,359,209 8,620,000 1926 1927 1928 1929 *Pounds converted to gallons on basis of 6 pounds per gallon. Source of data: U. S. Dept. Commerce, Foreign Commerce and Navigation of the United States. The quantities of the various types of olives imported into the United States during the six years 1924-1929 are given in table 10. Of the average annual imports of 7,665,000 gallons during the three years of 1927-1929, 56 per cent were green olives in brine, 30 per cent pitted and stuffed olives, 11 per cent dried ripe olives, and 3 per cent ripe olives in brine. During the past six years there have been substantial increases in the imports of green olives in brine, pitted 18 University of California — Experiment Station and stuffed olives, and dried ripe olives. On the other hand, imports of ripe olives in brine have experienced a large decrease. Importations of dried ripe olives and ripe olives in brine, which constituted about 14 per cent of the total imports during the three years 1927-1929, probably compete most seriously with domestic canned ripe olives. Imported ripe olives are consumed largely by people of southern European origin and consequently compete with small sizes from California, which are packed primarily for that trade. Although imported green olives differ radically in taste and food value from California canned ripe olives, they probably compete to some extent since they are both used as a relish. Among those people who are familiar with both types of olives the consumption of green olives probably precludes the consumption of as many ripe olives as would otherwise be consumed, and vice versa. The type of olive that is used appears to depend largely upon taste and habit and to only a minor extent upon price. TABLE 11 United States Import Duties on Olives Green olives in brine Pitted and stuffed olives. Ripe olives in brine Dried ripe olives Tariff Act of 1922 rate of duty 20 cents a gallon 30 cents a gallon 20 cents a gallon 4 cents a pound Tariff Act of 1930 rate of duty 20 cents a gallon 30 cents a gallon 30 cents a gallon 5 cents a pound Source of data : U. S. Dept. Commerce, Bur. Foreign and Domestic Commerce. Statistical classification of imports into the United States with rates of duty. The rates of duty on olives imported into the United States under the tariff acts of 1922 and 1930 are given in table 11. No changes were made in the import duties on green olives in brine and pitted and stuffed olives. The import duty on ripe olives in brine, however, was increased 50 per cent while that on dried ripe olives was increased 25 per cent. OLIVE OIL United States Production and Imports of Olive Oil. — The produc- tion of edible olive oil in this country constitutes only a small part of that consumed here. During the nine years 1921-1929 the average annual supply amounted to 10,357,000 gallons, of which 10,171,000 gallons, or 98.2 per cent, were imported. Bul, 510] Olives 19 Both domestic production and imports have increased during the past decade (table 12). The average annual production in this country during the three years 1921-1923 amounted to 167,000 gal- lons as against an average of 193,000 gallons during the three years TABLE 12 United States Imports and Production of Edible Olive Oil, 1921-1929 Year* General imports Foreign exports Net imports Domestic production Total supply Percentage of total supply imported 1,000 gals. 1,000 gals. 1,000 gals. 1,000 gals. 1,000 gals. per cent 1921 6,628 26 6,602 200 5,802 97 1 1922 8,158 9 8,149 160 8,309 98 1 1923 10,292 9 10,283 140 10,423 98.7 1924 10,158 15 10,143 220 10,363 97.9 1925 12,057 46 12,011 120 12,131 99 1926 10,467 14 10,453 251 10,704 97 7 1927 10,003 17 9,986 140 10,126 98 6 1928 11,059 19 11,040 222 11,262 98 1929 12,906 30 12,876 219 13,095 98.3 *Imports are for the calendar year, domestic production for the year ending October 31. Sources of data: Imports from U. S. Dept. Commerce, Foreign Commerce and Navigation of the United States, annual issues. Pounds converted to gallons on the basis of 7.5 pounds per gallon. Domestic production: Years 1921-1925 estimates based on records of canners and data collected by U. S. Dept. Commerce, Bur. of the Census; years 1926-1929 from California Olive Association. TABLE 13 United States General Imports of Edible Olive Oil by Countries of Origin, 1921-1929 Calen- Algeria dar Italy Spain France Greece and Other Total year Tunis countries gallons gallons gallons gallons gallons gallons gallons 1921 3,108,749 1,230,942 626,570 1,294,568 367,270 6,628,099 1922 4,450,669 2,053,050 1,013,572 526,454 26,199 88,275 8,158,219 1923 6,629,651 2,493,736 891,713 192,076 32,090 52,795 10,292,061 1924 7,098,110 1,871,863 780,842 216,547 136,470 54,361 10,158,193 1925 8,264,481 2,072,887 1,000,040 371,627 306,221 41,590 12,056,846 1926 7,386,924 2,262,087 591,211 27,830 108,971 90,436 10,467,459 1927 6,281,344 2,519,268 801,295 135,449 207,572 58,434 10,003,362 1928 7,191,487 3,025,701 605,787 63,622 91,168 81,411 11,059,176 1929 9,578,934 2,201,588 685,127 156,525 244,227 40,033 12,096,434 Source of data: U. S. Dept. Commerce, Foreign Commerce and Navigation of the United States, annual issues. Pounds converted to gallons on the basis of 7.5 pounds per gallon. 1927-1929, an increase of 16 per cent. During the same period net imports increased from an average of 8,345,000 gallons to an average of 11,301,000 gallons, an increase of 35 per cent. The principal foreign countries from which the United States receive edible olive oil are given in table 13. During the three years 20 University of California — Experiment Station 1927-1929 an average of 67.9 per cent of the total imports came from Italy, 22.8 per cent from Spain, 6.2 per cent from France, 1.6 per cent from Algeria and Tunis, and 1.0 per cent from Greece. These countries combined supplied 99.5 per cent of the total imports. The increase in the general imports of 2,964,000 gallons between 1921-1923 and 1927-1929 was mainly from Italy, Spain, Algeria, and Tunis. There was a substantial decline in imports from Greece and a small decline in imports from France. ESTIMATED CONSUMPTION OF EDIBLE OLIVE OIL IN THE UNITED STATES AND AVERAGE ANNUAL WHOLESALE PRICES OF EDIBLE OLIVE OIL AT NEW YORK, 1921-1929 1921 1922 1923 1924 1925 1926 1927 1928 1929 Fig. 4. -There has been an upward trend in both price and consumption of edible olive oil in this country during the past decade. Data from table 14. Increased Demand for Olive Oil. — The demand for olive oil in this country has experienced a substantial increase during the past decade as evidenced by the fact that both consumption and prices have risen. In figure 4 the annual consumption of edible olive oil is repre- sented by the shaded bars, the average annual wholesale price at New York by the solid line. Between 1921-1923 and 1927-1929 consump- tion increased from 8,549,000 gallons to 11,384,000 gallons, an increase of 33 per cent. During the same period average wholesale prices at New York rose from an average of $1.90 a gallon to an average of $2.18 a gallon, an increase of 15 per cent. Bul, 510] Olives 21 TABLE 14 Estimated Consumption of Edible Olive Oil in the United States and Average Annual Wholesale Prices of Edible Olive Oil at New York, 1921-1929 Calendar year Total supply Stocks on hand begin- ning of year Available for consumption Stocks on hand at end of year Estimated consumption Wholeslae price per gallon at New York 1 2 3 4 5 6 1,000 gals. 1,000 gals. 1,000 gals. 1,000 gals. 1,000 gals. dollars 1921 6,802 918 7,720 872 6,848 2.15 1922 8,309 872 9,181 1,049 8,132 1.79 1923 10,423 1,049 11,472 805 10,667 1 75 1924 10,363 805 11,168 551 10,617 2.02 1925 12,131 551 12,682 936 11,746 2 01 1926 10,704 936 11,640 486 11,154 1 91 1927 10,126 486 10,612 641 9,971 2 13 1928 11,262 641 11,903 522 11,381 2.27 1929 13,093 522 13,615 815 12,800 2.15 Sources of data: Col. 1: table 12. Cols. 2 and 3: U. S. Dept. Commerce, Bur. of the Census reports on animal fats and oils. Pounds converted to gallons on the basis of 7.5 pounds per gallon. Col. 6: U. S. Dept. Commerce, Bur. Labor Statistics, Wholesale prices in the United States. One of the important causes of the increased demand for olive oil was the large increase in the use of salads and the increasing popu- larity of oil dressings. Edible olive oil is also used for cooking and medicinal purposes and in the packing of sardines, but no definite information is available on the increase in demand for these purposes. Competition Between Olive Oil and Other Fats and Oils. — A detailed analysis of the competition between olive oil and other fats and oils is beyond the scope of this bulletin. Only a statement of the general situation can be given here. The United States Tariff Com- mission points out that "modern improvement in refining, bleaching, and deodorizing processes have enhanced the edible qualities of several vegetable oils to such a degree that they have been increasingly used as salad or cooking oils. ' ' Corn and cottonseed oils, which have aver- aged around 85 cents a gallon in New York as compared with an average of $1.95 a gallon for olive oil, have displaced olive oil for salad purposes to a considerable extent among those buyers with whom price is an important consideration. There is, of course, a large class of buyers who prefer olive oil to other salad oils and who are willing to pay a large premium for it. On the other hand, another class will buy olive oil only when its price is not too far above that of the other salad oils. Any material rise in the price of olive oil in comparison with the price of other salad oils will cause this class to reduce their purchases. 22 University of California — Experiment Station While there is considerable competition between olive oil and other fats and oils, it is probable that the competition is not so keen as it is between such oils as coconut, corn, and cottonseed. A comparison of the wholesale prices of these oils is shown in figure 5. It will be noted that there is a marked similarity in the direction and extent of the price movements of coconut, corn, and cottonseed oils. These oils have many properties in common and consequently one oil can be easily substituted for another. This substitution tends to maintain the prices of these oils within narrow limits. On the other hand, because WHOLESALE PRICES PER GALLON OF EDIBLE OILS AT NEW YORK 3.50 I \ OLIV E? V\ ^ ^ 2.00 \ / c ?z> . m * Iliv"> \ • • • • • • • CO :onut^ •"V • ^c OTTONSE ED • V r 1 " 1921 1922 1923 1924 1925 1926 1927 1928 1929 1930 Fig. 5. — The price of edible olive oil fluctuates to a considerable extent independently of the prices of other edible oils. Data from table 15. of the peculiar properties of olive oil, its price fluctuates to a con- siderable extent independently of the prices of other oils, But as the margin between the price of olive oil and other oils widens, there is an increasing' tendency to substitute the lower-priced oils for olive oil. This substitution acts as a brake on a further widening of the margin. Prices Paid to California Growers for Oil Olives. — The prices which growers have received for oil olives from 1921-22 to 1929-30 are given in table 16. During this nine-year period prices have aver- aged $34 a ton. These low prices have constituted a considerable drag* on the olive industry in this state and have been felt particu- larly by those growers who have had a considerable proportion of their crop go into oil. Sufficient facts are not available to indicate accu- rately the future trend of olive-oil prices. But unless the imports of Bul, 510] Olives 23 TABLE 15 Wholesale Prices per Gallon of Edible Oils at New York, 1921-1930 January April July October January April July October Year dollars dollars dollars dollars dollars dollars dollars dollars Olive oil Cottonseed oil 1921 3.40 2 00 2 25 1.75 63 045 0.65 66 1922 1.60 1 80 1.80 1 80 65 86 080 69 1923 1.79 1.80 1.73 1.70 81 088 77 90 1924 1.76 2 00 2 00 2.15 83 76 91 85 1925 2 15 2 00 2.00 2 00 84 83 86 74 1926 2 00 1.85 1.85 2 00 0.85 0.93 1 13 66 1927 2 00 2 15 2 15 2 15 64 0.68 71 0.82 1928 2 50 2 25 2 20 2.25 0.76 74 76 74 1929 2.25 2 25 2 25 2 00 77 76 72 0.70 1930 2 00 2 00 1.75* 1.75* 63 65 0.60 61 Coconut oil Corn oil 1921 98 0.79 83 81 90 73 68 84 1922 74 72 70 70 81 0.98 94 0.82 1923 77 83 0.81 77 0.92 1.02 91 98 1924 0.78 77 74 84 1 00 91 0.97 99 1925 94 94 092 1 02 1 08 1.01 97 1 02 . 1926 99 94 96 84 94 98 1.20 1 02 1927 0.81 79 86 81 84 87 92 1928 81 81 78 77 93 90 90 90 1929 80 74 68 70 90 0.90 89 86 1930 0.68 0.68 0.63 59 86 86 77 78 *These quotations are considerably above prices quoted buyers of edible olive oil on the Pacific Coast. Sources of data: Olive and cottonseed oil prices from U. S. Dept. Commerce, Bur. of Labor Statistics. Wholesale prices in the United States. Coconut and corn oil prices from New York Journal of Commerce, average of Saturdays' quo- tations. TABLE 16 Average Prices Paid Growers for Oil Olives, 1921-22 to 1929-30 Year Nov. to Oct. Price in dollars per ton Number of gallons of olive oil obtained from a ton of olives / 2 1921-22 1922-23 35 38 34 34 33 34 35 33 32 38 39 1923-24 34 1924-25 34 1925-26 40 1926-27 36 1927-28 34 1928-29 . 36 1929-30 35 Sources of data: Col. 1 : Compiled from records of canners. Col. 2: U.S. Dept. Commerce, Bur. of the Census reports on animal and vegetable fats and oils. 24 University of California — Experiment Station olive oil are greatly reduced by means of a very high tariff, it does not appear that prices of olive oil will rise high enough to raise the olive industry in this state to a profitable level. Import Duties on Olive Oil. — The rates of duty on olive oil imported into the United States under the tariff acts of 1922 and 1930 are given in table 17. It will be noted that there was an increase in the duty on edible olive oil in packages weighing less than 40 pounds from 7.5 cents a pound to 9.5 cents a pound, but no increase in the duty on edible olive oil in bulk, which remains at 6.5 cents a pound. The present differential of 3 cents a pound between the import duties of olive oil in small packages and olive oil in bulk, therefore, repre- sents a duty on containers based on the weight of the oil. TABLE 17 United States Import Duties on Olive Oil Tariff Act of 1922 Tariff Act of 1930 Olive oil, edible: In packages weighing less than 40 pounds Other Olive oil, inedible, for mechanical or manufacturing pur- poses : Sulfured or foots , Other rate of duty 7.5 cents a pound 6.5 cents a pound free free rate of duty 9.5 cents a pound 6.5 cents a pound free free Source of data: U. S. Dept. Commerce, Bur. Foreign and Domestic Commerce, Statistical classification of im- ports into the United States with rates of duty. Inedible olive oil is admitted free of duty. The volume of inedible olive oil imported into the United States, however, has little effect upon the California olive industry since practically all of the olive oil produced in this state is edible. World Production of Olive Oil. — The production of olive oil, including inedible, in the leading olive-oil-producing countries of the world from 1921 to 1929 is given in table 18. World production during the three years of 1921 to 1923 averaged 199,940,000 gallons a year as against an average of 282,813,000 gallons a year during the three years of 1927 to 1929, an increase of 82,873,000 gallons, or 41 per cent. The increase in production in Spain alone amounted to 60,071,000 gallons, which is 73 per cent of the total increase. Although the United States received about three times as much edible olive oil from Italy as from Spain during the three years of 1927 to 1929 the total production of olive oil in Spain during the same Bul, 510] Olives 25 period was twice as large as in Italy. Of the average annual world production of 282,813,000 gallons between 1927 and 1929, 51 per cent was produced in Spain, 23 per cent in Italy, 9 per cent in Greece, and 6 per cent in Portugal. TABLE 18 Production of Olive Oil in Leading Countries, 1921-1929 Year Spain Italy Greece Portugal Algeria Tunis France Others Total 1,000 gals. 1,000 gals. 1,000 gals. 1,000 gals. 1,000 gals. 1,000 gals. 1,000 gals. 1,000 gals. 1,000 gals. 1921 81,144 42,664 13,128 6,803 6,823 9,995 2,777 9,446 172,780 1922 84,984 74,391 28,811 8,524 7,484 5,347 2,641 9,139 221,321 1923 87,849 52,253 15,659 12,771 9,489 6,467 4,236 16,995 205,719 1924 98,528 61,287 30,418 11,599 6,865 6,467 2,352 11,884 229,400 1925 96,290 39,361 18,758 11,271 6,301 9,995 2,037 8,273 192,306 1926 67,641 49,827 18,058 4,630 4,232 11,763 2,352 13,059 171,562 1927 195,662 42,387 21,283 26,614 7,086 4,707 2,481 13,032 313,252 1928 56,261 63,493 29,416 7,573 6,595 13,227 2,347 18,587 197,499 1929 182,267 84,702 21,773 17,200 6,787 17,640 2,053 5,267 337,689 Source of data: U. S. Dept. Agr., Bur. Agr. Econ. Foreign Crops and Markets, annual issues on fats and oils. Pounds converted to gallons on the basis of 7.5 pounds per gallon. ACKNOWLEDGMENTS The author of this bulletin wishes to express his thanks and indebt- edness to the following organizations which have generously con- tributed from their data and their time : California Cooperative Crop Reporting Service ; Bureau of Agricultural Economics, United States Department of Agriculture; Bureau of Foreign and Domestic Com- merce, United States Department of Commerce ; California Olive Asso- ciation; and many canners throughout the state. Mr. Bert Smith, Assistant Farm Advisor, Butte County, and Mr. Grant Merrill, Assistant Farm Advisor, Tehama County, have furnished valuable information on the acreage of olives by varieties. 26 University of California — Experiment Station Appendix of Tables TABLE 19 Acreage and Production of Olives in Spain, 1909-10 to 1929-30 Acreage Production Year Total For oil Olive oil 1 8 3 4 1,000 acres tons tons 1,000 gals. 1909-10 3,447 1,541,340 1,468,534 70,480 1010-11 3,499 688,518 667,003 31,896 1911-12 3,567 2,446,573 2,341,112 123,982 1912-13 3,577 391,682 383,170 18,519 1913-14 3,590 1,638,982 1,559,524 78,020 1914-15 3,619 1,302,291 1,259,280 61,072 1915-16 3,662 1,954,253 1,904,153 95,858 1916-17 3,675 1,263,896 1,223,722 60,881 1917-18 3,718 2,433,548 2,369,850 125,761 1918-19 3,853 1,547,444 1,494,783 75,016 1919-20 3,884 1,998,580 1,941,562 98,882 1920-21 3,883 1,832,447 1,797,622 93,170 1921-22 3,987 1,678,906 1,642,003 81,144 1922-23 3,986 1,697,047 1,661,278 84,984 1923-24 4,013 1,778,399 1,740,855 87,849 1924-25 4,090 1,923,272 98,528 1925-26 4,149 2,059,359 96,290 1926-27 4,186 1,422,701 67,641 1927-28 3,979 3,876,329 3,831,147 195,662 1928-29 4,416 1,070,201 1,048,415 56,261 1929-30 4,492 3,682,719 3,634,261 182,267 Sources of data: Cols. 1 and 2: International Institute of Agriculture. International Yearbooks of Agricultural Statistics. Col. 3: U. S. Dept. Agr., Bur. Agr. Econ. Foreign News on Fats and Oils. Col. 4: U.S. Dept. Agr., Bur. Agr. Econ. Foreign Crops and Markets. Bul, 510] Olives 27 TABLE 20 Acreage and Production of Olives in Italy, 1909-10 to 1929-30 Acreage Production Total Unmixed Mixed Olives Olive oil 1 2 3 4 5 1,000 acres 1,000 acres 1,000 acres tons 1,000 gals. 1909-10 5,794 1,685,637 67,606 1910-11 5,761 1,435 4,326 1,031,488 37,132 1911-12 5,794 1,361 4,433 1,491,324 63,990 1912-13 5,714 1,354 4,360 672,073 25,307 1913-14 5,661 1,344 4,317 1,076,600 46,018 1914-15 5,678 1,374 4,304 1,188,280 47,128 1915-16 5,704 1,454 4,250 1,025,690 39,995 1916-17 5,708 1,464 4,244 1,424,392 54,472 1917-18 5,686 1,450 4,236 1,381,072 55,872 1918-19 5,670 1,442 4,228 1,900,806 76,345 1919-20 5,669 1,446 4,223 888,564 30,142 1920-21 5,664 1,431 4,233 1,344,806 53,864 1921-22 5,658 1,428 4,230 1,032,084 42,664 1922-23 5,709 1,435 4,274 1,739,981 74,391 1923-24 5,706 1,429 4,277 1,258,827 52,253 1924-25 5,643 1,422 4,221 1,494,719 61,287 1925-26 5,670 1,433 4,237 964,292 39,361 1926-27 5,669 1,431 4,238 1,384,489 49,827 1927-28 5,633 1,406 4,227 1,110,303 42,387 1928-29 5,754 1,418 4,336 1,558,487 63,493 1929-30 5,572 1,903,4)5 84,702 Sources of data: Cols. 1, 2, 3, 4: International Institute of Agriculture. International Yearbooks of Agricultural Statistics. Col. 5: U. S. Dept. Agr., Bur. Agr. Econ. Foreign Crops and Markets. TABLE 21 Production of Olives in the Leading Olive-producing Countries of the World, 1922-23 to 1929-30 Country Spain Italy Algeria. Tunis France French Morocco. Syria and Lebanon Greece Cyprus Tripoli United States 1922-23 tons 697,047 739,981 123,458 116,844 49,508 55,115 141,095 2,699 4,437 10,000 1923-24 tons 1,778,399 1,258,827 156,256 122,356 79,421 65,036 4,361 17,000 1924-25 tons 1,923,272 1,494,719 156,286 121,253 44,202 78,264 31,967* 51,868 9,421 22,046 6,500 1925- tons ,059,359 964,292 190,021 187,391 28,926 88,184 18,457 2,518 25,353 14,000 1926-27 tons 1,422,701 1,384,489 112,973 220,460 36,494 22,046 15,439 3,521 12,200 1927-28 tons 3,876,329 1,110,303 207,030 88,184 52,797 66,689 56,177 16,343 25,900 11,023 18,600 1928-29 tons 1,070,201 1,558,487 248,018 57,294 55,115 44,403 54,067 2,800 20,500 1929-30 tons 3,682,719 1,903,475 19,500 *Syria only. Source of data: International Institute of Agriculture, International Yearbooks of Agricultural Statistics, except those for United States, which are from figure 1 .