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Cedar Rapids Gazette (Newspaper) - May 13, 1974, Cedar Rapids, Iowa 10 The Cedar Rapids Gazelle: Mon., May )3, 1974 Study Absolves Middleman Of Marketplace Villainy By Brian B. King WASHINGTON (AP) Last year. tt.i. fowl prices rose faster than they had in more than a quarter-century and fanners received their highest share in one "markelbasket index" in 20 years. But at the same time, says a significant new study by agriculture department economists, the after-tax profits of the large agribusiness food corporations held at an average 2.4 percent of sales, a decade-old level. However, the after-tax profits of the 15 leading retail supermarket chains, for the first nine months averaged "0.5 percent of sales, slightly less than a year earlier but much below the historical average of slightly over 1 percent." the study said. Controversial The Economic Research Service study, quietly released earlier this month, is important because, in the period since those first nine mouths, the issue of middlemen's mark- ups and profits in the farm-to-table marketing chain has become increasingly controversial and farther forward on the general political stove. Agriculture Secretary Earl Butx, in one of his rare agreements with organized consumer groups, frequently has raised pointed questions about the apparently higher retailers' and wholesalers' shares of the grocery-buyer's devalued dollars. Farm groups have joined in, along with members of congress from both urban and rural regions. The'48-page analysis was ordered by congress to provide an objective study of the components of the grocery bill who gets 'how much for doing what. Gray Arguments 'Its effect may be to turn previously black-and-white' ar- giia'ients on Die issue into a more gray battlefield. The study shows thai middlemen's spreads last year rose l.i percentage points faster than the 5.3 percent rate for the general economy. But it also notes that, for the last two years, tin.' margin has given way to farm prices as the chief cause of frud-priee hikes, that the wages of those who work for the imddloinen are the key to the margin increases and that "windfall profits" are not an element. For example, the researchers found the farm-to-market I'lrice spread continuing to widen to (he point where, last year, 51) cents of every dollar spent on food served at home and 78 di'iits of every dollar spent on food away from home went for Profits Decline But the last graph in the booklet 'Shows the leading super- markets' percentage profits in a steady decline since 1970 and those of the giant food-manufacturing corporations little changed in 10 years. The analysis is the first of its kind since the comprehensh e National Commission of Food Marketing study, although the agency compiles monthly farm-retail price-spread infor- mation on a "marketbasket" of Ii5 items a hypothetical average family buys each year. Because different factors are involved, the statistics differ somewhat from other government and private markelbaskel surveys. For example, the official figure for food-price infla- tion for HI73 is 14.5 percent above the 1972 level; this study uses 17..1 percent. Figures Costs Another USDA agency's marketbasket guideline puts the same thing in more identifiable terms. Using a "low-cost" plan developed by nutritionists and economists, it figures the cost of food at home for a week for a hypothetical family with two elementary-school children to have been lost April, S40.80 when Ihe 1973 food-price increase rate peaked in Angus! and two months ago. For middle-income families and those under the "liberal the increases were not as steep: to to HI- and II) to But what the research service study dealt with was "what are you paying when you buy any of the 19 leading farm-food items. Labor Costs "labor is the largest component of the processing margin for most products, followed by packaging it found. Indeed, the summary notes, "Nearly half of the marketing bill in recent years has gone for labor costs. Labor costs for all marketing services rose 8 percent in 1973 to over billion" of the billion spent on U.S. farm-produced food, billion of which went to the farmers. "The largest share of the labor bill went for food process- ing. However, increases for retailing, wholesaling and away- from-home eating during the past decade have been a third greater than for Ihe analysis found. Over-all, grocery buyers spent billion more on U.S. farm foods last year, while farmers received billion more lltiin in 1972. For only Hie second lime since 1950, returns to farmers rose more than marketing costs, it said. Other Facts Among Ihe other facts compiled and analysed by the USDA team: The higher prices farmers received accounted for nearly 75 percent uf the increase in the retail prices as the farm value of the surveyed goods rose 33.5 percent. The over-all farin-lo-relail spread rose slightly faster lhan general inflation, at 6.5 percent higher than 1971 All market- ing transportation, processing and distribution rose 7.8 percent while labor, as the major component part, rose 8 per- cent. The greatest price Increase at (he farm level was for poultry and eggs. 77 percent higher than 1972. The relail and farm prices and farm-lo-retail spreads were nil above average for meat, poultry, eggs and fresh vegetables. Although the price spread for fats and oils fell 4.9 percent, the retail price rose 10.7 percent on the strength of a 53.6 per- cent boost at the farm level. Bakery and cereal products went up 48.3 percent at the farin level and 11.3 percent in the supermarkets, but the middlemen's spread, for bakers and millers, rose only 3.9 percent. Thousands of Children Face Starvation By Charles E. Flinner WASHINGTON (UPI) It got to be a family joke when Mom used to say, "Eat everything on your plate; there are children starving over- seas." It turned out it wasn't a joke nor is it now. Thousands, probably hun- dreds of thousands, of children face starvation. The governments of the rich food growing countries tell governments of the poor developing countries that there simply is not enough food to go around. Stocks Limited Don Paarlberg, an economist of the agriculture department, was questioned recently by Asian newsmen about pros- pects for getting U. S. food relief to in immediate dire need. "There are -very limited stocks Paarlberg said. "You can'l fed people out of nonexistent stocks." Reviewing the world food si- tuation, Paarflberg said "the average mam in the less developed country eats better than his father did." In the past, there were problems ".we weren't awajre of because we didn't have, all this com- he said. "We are sensitized." Indeed, CKamples of some of (he oversells hunger that Mom vaguely hiuard about can be seen on television almost every night, subject to film availability and editors' choices. Now there's a new version of Mom. Rather than advising, "Clean up your she urges: "Eat less." gray haired British lady is a kind of fairy godmother to millions of the world's most impoverished children, most of whom have probably never heard her name. Her name is Barbara Ward. After making public plead- ings, buttonholing politicians, and generally trying to remind the leaders of the affluent world that they ought to do something about the less for- tunate, she is turning to the families the average citizens in the industrial world. Restraint she said on a recent swing through Washington, "the kids out there are dying. "Why don't families with an income above a certain level exercise a voluntary constraint on food consumption, say 10 percent That would create instant stocks, she said. "You can't help being rich you can't help being consump- she told a handful of American congressmen recently, pointing out that ef- to help the un derdeveloped world won't work without American support. "If you're 40 percent of the world economy, you can't take yourself she said. Her message: Don't put so much on your plate; there are thousands of children overseas who are literally starving Regents Favor Acceptance of Donated Farm COUNCIL BLUFFS The State Board of Regents has recommended to the Iowa executive council the accep- tance of a 285-acre Hamilton county farm for Iowa State university. The board action came at'its meeting here last week. The farm, located a half-mile east of Williams, is a gift to the university from Jessie V. Coles of Greenbrae, Calif., a 1915 graduate of the ISU college of home economics. Dr. Coles made the gift in memory of her parents, John Wesley Coles and Eda e. coles. She said she wants the farm to be used "to assist education and research in agriculture." She acknowledges a sentimen- tal interest in the farm because she had grown up there in the early 1900s. Dr. Coles was on the faculty of the University of California at Berkeley when she retired in 1961. Under the terms of the gift, proceeds from the farm are to be used to aid research or provide scholarships in agriculture until the year 2000. The present tenant is also to be retained until that time if he so- desires. After the year 2000 the university may dispose of the farm or use the proceeds from it as it sees fit. Analysts Predict Upturn In "Tight Wheat Reserve By Bernard Slater Holstein Recognized as 'Iron Grandma' OLIN A registered Hol- stein owned by Jay Slater of Olin has been recognized as an "iron grandma" of the Hol- stein breed for producing over 100 tons of milk. The cow, Clovcrbrook Mas- ter Dotty 4869717, produced nearly quarts of milk during her lifetime. Her output stands at pounds of milk and pounds of but- lerfal. USDA Budget About 62 percent of the U.S. department of agricul- ture budget for 1972 was used for programs that were not strictly farmer oriented such as foreign relations, defense, food distribution and improvement of natural resources. DR. CRAVEN DENTIST PRACTICE 1IMITEO TO DENTURE WORK IIJ lifAvo. SE, dopidi, la. Dei Mcinoj e Moion City Slou goes to market in the year stra.rting July 1, they can foresee demand for 810 million bushels in U. S. food and livestock feed markets com- pared with 784 million bushels in the current season. But ex- port sales are expected to drop to 1 billion bushels compared with this season's record of 1.2 billion bushels. The predicted total demand in the new season of 1.81 billion bushels, subtracted from the predicted crop of 2.172 billion bushels, would leave 363 million bushels to add to carryover reserves on July 1, 1975. The reserve would then reach the 533 million-bushel mark. IT'S THE SEASON FOR GARAGE SALES. GET RESULTS WITH A CLAS- SIFIED AD. DIAL 398-8234. Schwartzhoff Heads Soil Commissioners WAUKON-John Schwartz- hoff has been re-elected chairman of the Allamakee county soil conservation dis- trict. Other officers elected include: Lloyd Median, vice- chairman; Leon Schoh, treasurer, and Mary Winters, secretary. Force for Peace American agriculture abundance is a powerful force for world peace. American farm products are helping relieve hunger and are promoting economic growth in newly developing countries as well as alleviat- ing widespread famine. HILTBIHItflVER 116 SECOND STREET SE Steffens Cow Has Top Record DECORAH -'Erbie Steffens of Decorah had the highest record cow in the Dairy Herd Improvement Assn. program for the 10-month period ending in March. His registered Hol- stein completed a record of pounds of milk and 790 pounds of butterfat, according to Duane Engelhardt and Os- car Lembke, DIIIA supervisors in Winneshiek county. The second high, record, completed on the Ernlo Hol- stein farm of Ossian, was 769 pounds of butterfat. A cow in the McClintock and Ryan herd of Decorah had the other 700- pound record at 711. One Failure Could Set Off Food Shortage UNITED NATIONS, N. Y (AP) The head of the Food and Agricullure Organization says that a crop failure this year in just one major produc ing region "would cause a widespread food shortage." Director General Addeke H Boerma said although most wheat crops look good, reserve stocks are even lower than before and "Ihe world wil depend for its grain supplies on this year's harvests more than in any year since 1945." In a prepared speech, he said the most dangerous possibility was "a shortfall in the vital Asian rice crop later this year if there is not a heavy enough monsoon." He said his or- ganization was thinking of what governments could do to meet sucli contingencies. Boerma was among speakers at the opening session of a conference on the role of inter- national .organizations in the food and energy crises, spon- sored by the Aspen Institute for Humanistic Studies, the Over- seas Development Council, the Institute on Man and Science and the Kettering Foundation. The unofficial conference, bringing U. N. officials and delegates together with ex- perts, continues through Sunday. At the HOME of the FREE Free checking with no service charges and no For personal and business ac- counts. Another free service from the Home of me Free. GUARANTY BANK TRUST CO. 3rd St. 3rd Dtwnlown )819 42nd St. NE JaeolynDr. NW Phone 362-2115 FACTORY TRAINED SERVICE Opon Mon. and Thurt. 'Til 9iOO P.M. PEOPLES HIMIIWI 215 1st Avo. SE Phone 366-2436 Summer Events Involve 4-H Members from Linn The Linn county 4-11 exten- sion youth committee has- selected award winners lo at- tend out-of-county events this summer. The winners include: State 4-H Conference Barb Creen, Carolyn Henderson, Cindy Stark and Diane Vislisel, Cedar Rapids; Debbie Becker, Center Point; Ed O'Connor and Connie Powell, Central City; Suzanne Brinner, Janice Christensen, Julie DeWoody, Laurie Jordan, Paula Martin, Julie Scott, Patsy Stephens and Nancy Westbrock, Marion; Joann Lawrence, Mariann Lawrence, Monticello; Patty Cribbs, Dean Mallie, Steve Scott and Diane Viktor, Mt. Vernon; Gayla Bentrott, Springville; Randy Rommann, Walker, and Bill Schrader.i Watford. .Washington Citizenship Short Course Barb Green, Mike Dohnalek, Carolyn Hen- derson and Cindy Stark, Cedar Rapids; Debbie Becker and Keith Kadlec, Center Point; Karen Boss, Coggon; Wayne Jones and Tim Mackey, Ely; Joel Frederick, Lisbon; Janice Christensen, Donna Foley, Douglas Jordan, Laurie Jor- dan, David Martin, Paula Martin, Reagan Robinson, Julie Scott, Patsy Stephens and Mark Jordan, Marion; Brian Kirkpalrick, Dean Mallie, Steve Scott and Diane Viktor, Mt. Vernon; Becky Merrill, Brad Merrill and Mark Nic- terl, Springville; Joe Fiala, Walker; and Bill Schrader, Walford rd. Camp delegates include: ..Camp delegates State leadership camp Patsy Stephens, Marion, and Bill Schrader, Walford; conserva- tion camp.Lettie Olmstead, Toddville' and co-operative leadership camp Diane" Vislisel, Cedar Rapids, and Brian Kirkpatrick, Mt. Ver- non. Other summer camping experiences planned this summer include a junior day camp and an interstate 4-H exchange with Colorado: The day camp will be held June 20 at Pinicon Ridge, Cen- tral City, and June 24 al Palisades Kepler state park, Mt. Vernon. The inlerstale exchange trip will be conducted from June 27 lo July 2. Ready for Pickup The Iowa Conservation Com- mission has delivered a load of trees and shrubs to Palisades- Kepler State park near Ml. Vernon for those who have or- dered Ihe planls earlier this spring. They can be picked up by contacling Ron Williams, park ranger, at 895-6039. New York tonlghl by long distance. Travel the US. A. IWl (or less) Any weekday after 5 p.m. and all weekend, you can travel by phone out-of-state and talk 3 minutes for 750 or less on calls you dial Dlnl-ll-youraoll raloD apply on nil inlorolnlo dlnlocl cnlln (wllhoul onnrnlor wominnca) Irom buolnooo or ronldonco plionon nnywhoro In Ilia conlinon- Inl U.S. (oxcopl Alnokn) nnd on cnlln iiiucod wilh nn opornlor whnro dlrocl aiallnn Incllilloo mo not nvullnblo, Dlal-Ulrocl rnlon do nol npply lo noroon- lo-poruon, coin, holol (jiiool, crodil wild nnd collocl cnlln, nnd on cnllo clinrgod lo nnolhor numbor. V little money still goes a ong way on tho telephone. I Northwestern Bell
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