AN ANALYSIS OF DEMAND AND PRICE RELATICNSHIPS … · 2020-01-22 · AN ANALYSIS OF DEMAND AND PRICE...

AN ANALYSIS OF DEMAND AND PRICE RELATICNSHIPS "

BE'IWEEN PEANUTS AND CASHEW NUTS

IN WE UNITED STATES, WITii EMPHASIS ON llili SALTED NUT TRADE

by

Gray Norwood Nuckols, Jr. ',,

Thesis submitted to the Graduate Faculty of the

Virginia Polytechnic Institute

in candidacy for the degree of

MASTER OF SCIENCE

in

Agricultural Economics

July 1961

Blacksburg, Virginia

i

The author vi•h•• to expr••• hi8 •incere appreciation to many per•oD8,

without vh08• aeurou• help thi• •tudy could not have been accompli•hed.

Special aratitude i• due to

th••i•, and to

1 who directed th•

, 11911iter• of th• author'• aclvi•ory ancl mullli.ning cOlllllitt••·

Valuable encouraa ... at aac1 .. •i•tanc• were al•o received from the follow-

iq:

1 of Virginia Polytechaic ID8titute;

t and I

the Uuivenity of Maryland;

, ancl

, of

• , aad

.. at of Aariculture;

of the United Stat•• Depart-

• of the Uuited Statal' ~•~i£f Couais-

•ion; • of th• United State• Bureau of the CeD8u.;

th• •taff of th• 1111> .. ay of India in Wahington, D. c.; varioua member•

of th• nut trade in the Uuitad State•; the typi•t•,

; and other•,

too numareu• to •ntion.

The author ow•• a apecial kind of appreciation to hi8 wife,

, hi• aon, · , hi• pare11ta,

, , hi• wife'• parent•, aad

, aad other mmber• of hi• faaily. Without their love and long-•uffer-

ing patience, th• completion of thi• th••i• would have been impoaaible.

'l'b.i• reaearch vu cOIMl\lelle4 UDder auapic•• of the Virainia Agricult-

ural SxperU.at Station and the Uuited ltatea lepartmnt of Agriculture u

a portion of Southern haional Marketiag Project IM-14, lubproj9Ct 2, Peanuts.

ii

TABLI Of CORTBITI

I. S~ry of the Study • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • 1

11. Introduction ••••••••••••••••••••••••••••••••••••••••••••••••• 6

ltat ... nt of the Problem ................................... 6

Objective• of the Study •••••••••••••••••••••••••••••••••••• 8

Mathoda of Procedure and Analy•ia .......................... 9

III. De•cription of the World Caahew Nut Induatry ••••••••••••••••• 11

Pbyaical Characteriatic• of the Caahew Tree and lfut ........ 11

Method• of Producing law Caahew Ruta ....................... 13

Production latimat .. for law lluta .......................... 16

Proc•••ing of Caahew Xeraela ............................... 20

World Caabev Trade Patterna •••••••••••••••••••••••••••••••• 27

India and United Stat•• Caahew Trade Channel• and Procedure• 36

Pric .. of Caahew• at All Market Le••l•···••••••••••••••••••• 40

U•aa• of Caahew Kernel• in the United Stat••--Pol'lllll and Quantiti•• Conaumad • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • 56

....... 61

IV. Deacription of )fut Production, ConaumptioR, and Price• in the United Stat•• •••••••••••••••••••••••••••••••••••••••••••••••• 66

General ••••••••••••••••••••••••••••••••••••••• , , , , , • • • • • • • • • 66

Production, Importa, and lxporta •••••••••••••••••••••••••••

ltut Conaumption Patterna ...................... ' ........... . Conaumar Survey aeaulta ••••••••••••••••••••••••••••••••••••

Price• ..................................................... V. ADaly•i• 'of Demand and Price llelation•hip• for Peanuta and

Ca•hew• in the United State•, with lllphUta on the Salted Nut

67

71

82

84

Trade •••• , ••••••• , •••• , ••••••••••••••• , • • • • • • • • • • • • • • • • • • • • • • • 96

iii

TABLE or CONTINTS (continued)

Jactora Believed to Affect Demand for Peanuta and Caahawa 96

lconomic Variable• Uaed to Maaaure Demand for Peanuta and Caahev• • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • 98

Statiatical Mathod and Tel'llinolOI)' for ~hi• Demand Analyaia •• 103

aeaulta of Demand Analyaia for Salted Peanut• ................ 108

lleault• of Demand Analyaia for Salted Caahewa ................ 111

aaault• of Demand Analyaia for All Caahewa ••••••••••••••••••• 116

Tentative Concluaiona Drawn from Demand Analy•i• for Peanut• and Cuhawa • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • •. • • • 118

lvaluation of ltatiatical llaaulta ............................. 121

VI. Biblioaraphy . ................................................. . 123

Literature Cited ••••••••••••••••••••••••••••••••••••••••••••• 123

VII. Vita ••••••••••••••••••••••••••••••••••••••••••••••••••••••••••• 127

VIII. Appendicea on Demand Analyaia •••••••••••••••••••••••••••••••••• 128

Appendix A - Part l. Identification of lconomic Variable• in Demand lquatioD8 •••••••••••••••••••••••••••••••••••••••••• 129

Appendix A - Part 2. ltatiatical Data Uaed in Demand .ADaly• 1• •••••••••••••••••••••••••••••••••••••••••••• ~ • • • • • • • • 132

AppencliX B - Detail• of Multiple lleareaaion (leaat aquarea) Demand lquationa Derived in the Analyai• ••••••••••••••••••••• 139

Section l - Caahear• lquationa .............................. 140

Section 2 - Peanut• Kquationa .............................. 153

iv

LIST Of TAil.ii

Table !!I! 1. Nutritional Analy•i• of Caahew Jternela u Compared with Peaut•. 14

2. Cuhew Planting and Rarveating leuona.......................... 15

3. Production of a. Cuhew Ruta in IucU.a and &aat Africa, 193.5-1960...................................... . . . . . . . . . . . . . . . . . . . . . . 19

4. Production of I.av Cuhew Kuta in India, by Statea, 1951-1952.... 19

5. Cuhew Kernel•: Percentage of Total Quantity falling into Bach Grade, Rw York, 1950........................................... 26

6. Caahev Nuta: Indian Supply and Diapoaition, 1955-1960.......... 28

7. C..hw l.ernela: &xporta froa Inclia, by Countriea of De•tination, 1937-1939....................................................... 33

8. Cuhew hrnela: United Stat•• Import• (and Apparent Conauap-tion), by Countriea of Oriain, 1931-1960........................ 34

9. Price• of a. Caahw Ruta, Paid by Proceaaora, India, 1952-1960. 40

10. Price• of a. Caahav Ruta, Paid by ProceHora in India, Convert-ed to ICarnel Bui•, 1952-1960................................... 41

11. Cuhew hrnel Pricea, P. 0. I. bportiq Pointa in Incli&, Averaae for All Grad••· 1932-1960............................... 42

12. Cuhev Kernel Price Quotationa by Indian Procuaon to U. I. Im-porter•, C. I. r. Nw York, 1947-1960........................... 44

13. Cuhew Kernel Price•: Whole•ale Quotatiou by U. I. Iaportera to Nut Salter• and other Proceaaora, P. O. I. New York, 1932-1960. . . • . • . . . • • • . • . . . . • . • • • • • . • • • • . • • • . • • • • • . • . • • • • • • . . • • • • • • • • . 4 7

14. Cuhew Kernel•: u. s. Total Importa, Import• throuah Rev York Cuatama Diatrict, Percentage of Total Import• &nterina Through Bw York, and Tariff late, 1931-1960............................ 50

15. Cuhew Kernel•: Proportionate Quantitiea and Price per Pound, by Gradea, Nev York, 1950....... •• • • •• • • • • • • • • • • • •• • • • • • • • • • • • • • 51

16. Salted Cuhew Kernela: letail Price• in Selected Chain food Store• and "Dim Store•", Su tern U. S., 1956-1961 Averaae...... 52

v

LIST OI' TABLES (continued)

Tabla

17, Cuhaw Price llang•• at Varioua Market Lav•l•··8U111Ury Table..... 53

18. Caahew ~•l'll•l•: Quantiti•• Uaed in the United States, Total and Par Capita Import• (Apparent Total ConeumptiOll), Total and Per Capita Kati.mat•• of Quantiti•• Salted (Apparent Salted Caahew Coneumption), 1932-1960 •••••••••••••••••••••••••••••• ~··· 59

19. reanuta and Tree Ruta: Production, Import•, lxporta, 811pply J>iapoaition, and Total DoMetic Couumption, United Stataa, Average of Yeara, 1955-1958..................................... 70

20. Edible Peanut• and Tree Ruta: rer C"pito Couumptioa in the United State•, Amlual Average of Year• Beginning October l, 1950-1952....................................................... 74

21. Conaumption of ldible Paanuta and Tree Ruta in Varioua forma, United Stat••, Annual Average of Year• Beginning October 1, 1950-1952. • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • 77

22. Couwaption of ldible Peanut• in Varioua fol'lll, United State•, Annual Average of Year• leainning Auauat 1, 1953-1958........... 77

23. Couumption of reanuta and Tree Ruta u Salted lute, United State•, 1947-19.59 ........................................ ·•••••••• 79

24. lclibl• Nute: rorm in Which Sold and Type of Paekaaing for Muta Sold at a.tail, United Stat••• 1950-1952 and 1954-1955..... 80

25. Couumer U•• of and Opinione About Paanuta and Tree lute, United Stat .. , Survey of Homemaker•, 1955 •••••••••••••••• ~...... 85

26. Pric .. Baceivad by Grower• for Peanut• and Tree luta, United Statea, 1929-1960............................................... 91

27. Pric•• Paid by But Balter• for Shelled Peanut• and Tree Ruta, United State•, 1933-1959........................................ 93

28. letail Price• of Salted Bute and Other Muta in Selected Chain food Store• and "J>ima Stora•"• Baatal'll United Statea, 1956-1961. 94

LIST OI FIGUllS

Figure

l. Production of law Caahew Nut• in India &Dd But Africa, 1935-1960 •••••••••••••.••••••••••••••• ·• • • • • • • • • • • • • • • • • • • • • • • • • • • • • 18

2. Total hporta of Caahew lterula from India, 1937-1959......... 29

3. Bxporta of Caahav Jteruela froa India, by Couutriea of Deatiua-tion, ADnual Average Percent•&• to Bach, 1956-1959............ 30

4. Total United State• Importa of Caahev Jterula, 1931-1960...... 31

5. Importa of C.Uhew Jternela to the United Statea by Couutri•• of Origin, Av•raa• Percentage from lach, 1956-1960............... 32

6. Pricea of C.Uhw lternela, B&aia C. I. r. lfw York, Average of all Gradea, 1950-1960......................................... 46

7. Price of Caahw Jterula, Bui• Whol•••l• at Hew York, Selected Graclea, 1947-1959................................. •.. . . . • . • • . . . 49

8. Per Capita Quantity of C.Uheva ConaUllBd in All Uaea, and Price of "320-Couut Whole" Grade Caahwa (Baaia Wholeaale r. O. I. Rw York)• 1932-1960.. • • • • • • • • • • • • • • • • • • •.• • • • • • • • • • • • • • • • • • • • • 54

9. Per Capita Quantity of Caahewa Conaumd u Salted Huta, and Price of "320-Couut Whole" Grade Caahewa (Ba•i• Wholeaale 1. O. I. Hw York), 1932-1960................................. 55

10. reauta &Dd Tr•• Huta: Production by ltiacla, aa rerceutag .. of Total llut Production, United Statea, Average of Yeara, 1955-19.58............................................. .. . . . . . . . . . . . 69

11. Per Capita Conaumpticna of ldibl• Peanut• &ad Specified Tr•• 111uta, aa rerceataa•• of Per Capita Coaaumptiou of All 9\&ta, United Stat .. , Average, 1955-1959............................. 73

12. Coaaumption of Peauta &Dd Tree Nuta aa Salted Muta, by ltinda Bxpreaaed u rercentaa•• of Total Salted Nut ColUlumptioR, United State•, Annual Average, 1947-1959...................... 78

vii

LIST OP APPENDIX TABLES

APPENDIX A • STATISTICAL DATA USID DI DBMAHD ANALYSIS

Table

A. Per Capita Conaumption of Salted Caahewa, All Caahw•, and Salted reanuta; Deflated Price• of Caahev•, Deflated Price of reanuta, Deflated Diapoaabl• reraoual Income, and Time Trend. United Statea, Annual Data, 1932-1959 ••••••••••••••• 133

B. Total Couumption of Salted Cuhewa, All Cuhewa, and Salted Peanut•; Price• of Cuhewa, rrice of P•anuta, Diapoaable P-raoual Incom, Wholeaale Price Index for Proceaaed looda, Population, aDCl Tim Trend. United Statea, ADDual Data, 1932-1959. • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • 136

AlPDDDt B - DITAILS Of MULTirLB UGDllIOM (I.KAST IQUADI) ·RMAJO> IQUATIONS DBl.IVID Df 'l'HI ARALYSIS

l. Per Capita.Couumption of Salted Caaheva and All Cuhava, u a Junction of Deflated Price• of Caahewa, Deflated Price of Peanuta, Per Capita Income, and Time. 1932-1959 ••••••••••••• 141

2. Per Capita Conauaption of Salted Caahew• and All Cuheva. u a Junction of Deflated Pricea of Caahewa, Deflated Price of reanuta, Per Capita Income, and Time. 1932•1941 •••••••••••• 143

3. rer Capita Couumption of Salted Caahew• and All Cuhewa, u a l'unct£on of Deflated Pria• of Caahewa, Deflated Price of Peanuta, Per Capita Income, and Tim. 1947-1959 •••••••••••• 145

4. Consumption of Salted Caahew• and All Cubewa, u a function of lrie•• of Caahewa, Price of Peauuta, Incoma, Price Index, Population, and Ti.ma. 1932•1959 •••••••••••••••••••••••••••• 147

5. Conaumption of Salted Caah•• and All Caahewa, u a function of Price• of Cuheva, Price of Peanut•, Incoma, Price Index, Population, and Ti.ma. 1932-1941 •••••••••••••••••••••••••••• 149

6. Couumption of Sal tad Cu hew• and All Caabewa, u a Junction of Pric•• of Caahewa, Price of raanuta, Inc:oma, Price Index, Population, and Time. 1947-1959 •••••••••••••••••••••••••••• 151

7. Per Capita Conaumption of Salted Peanut• aa a Junction of Deflated Price of Peanut•, Deflated 1ricea of Caahewa, Per Capita Income, and Time. 1947-1959 •••••••••••••••••••••••••• 154

8. Couumption of Sal tad Peanut• u a Function of Price of Pea• nuta, Pricea of Cuhewa, Incom, Price Index, Population, and Tilna. 1947-1959 •••••••••••••••••••••••••••••••········· 155

1

SUMKilY or THI STUDY

Thi• •tudy oriainated in 1955 f::cm. r.oncern expr••••d ii\ the peanut

incluatry. and in interutecl aovernmant aa•ncie• • that peanut• were po•-•ibly over•priced in the aalted nut market relative to certail\ other

••lted nuta believed to be competitive with them, Under the peanut price

aupport and production •ontrol proaraa •ponaored by the reclsral 1ov•rn-

mant, th• price of peanut• had been aupported above the equilibriUlll level

aince 1949. Peaswt coaaU11ption waa relatively •table, but caahav con-

aumption waa increaaiq. Peanut price• were incruaina at a faater rate

than caalaew pricea. 'l'he•• trenda were believed to be largely aaaociated

with th• price aupport and production cwtrol proarua for peanuta. Begin•

niaa in 1956. th .. • treacla were revereed, aa a reault of the tranaition

to ''llOcleni .. d" parity over a period of 4 year•, and the utabliat-nt of

lower pea11ut price 1upport level• duri-a th• period 1956 to 1959. Th•••

chang .. ii\ price aupport policy decr ... ed peanut pric .. , and were aaaociated

with aull increaaea ii\ per capita conaumption of peanut• durina the period

1956 to 1959. Duriaa th• •- period, per capita couumption of caahev

nuta ceaaed ita upward tread and tended to decline; ailllilarly 9 caahev

price declined •li&htly.

Thia reaearch waa limited to th• nature of demand and price relation-

ahipa prevailing for aalted peanuta, compared with their auppo••d major

competitor in thi• uaaae: caahev kerneh.

Th• primary objective of thia atudy waa to conduct a atatiatical

analyaia of demand and price relaticmahipa for •alted peanuta and caaheva.

Th• •tatiatical mthod uaed wu ordinary l ... t aquarea reareaaion analyaia

2

to derive aquatiou ahowina the net affect upon demand for paanuta and

cuhewa, aa •aaured by obaerved couumption data, of each of the follow•

ina auppoaed aaaociated factor•: (1) price of peanuta, (2) price of

caahwa, and (3) diapoaable pencmal incaaa.

leccnadary objective• aupportina the c1 ... 1l4 analyai• were: (1) to

prepare a d .. cription of the entire world caahev aut incluatry on aa com-

plete a baaia aa poa1ible aa a .. ana of appraiatua potential 1uppli••1

and (2) to aumaarise the relevant information on th• Ullited State•'

pattema of peanut encl tree nut production, conaumption, and price•, with

e.,haaia on the 1alted aut trade.

CUhav aut• are produced maialy 111 louth Iaclia aacl laat Africa, with

laat Africa becOlliaa more important in receat year• after havina been

about equal to India aa a producer of rw caahev•. Total caahav production

in India and laat Africa arev from an averaa• of about 160 million poun41

ia the period 1935•1939 to about 36.5 million pouncla in 1960. The crop

can be arown only ia tropical araaa, ao none i1 produced ill the Ullitecl

ltat••· Caahwa did aot become c01marcially important in woi-ld trade,

nor in the United ltat .. nut trade, until the late 1920'•·

Aa primary aupplier of •helled caahw kernel• to the United Stat••

and tba world, IDd.ia ahella aad packa for export nearly all of the laat

African raw nut crop in acldition to her domatic crop. Moat of her pro-

duction of caahew kernel• move• into export trade, about 70 percent in

reoaat year• caaina to the United ltat .. which ia the world'• main con•

aumer of caahwa.

United Stat•• caahw kernel illporta (total aupply and apparent con•

aumption are alao repreaented by th .. • data) roae •teadily from about ten

3

million pounda in 1931, the fir•t full year for which data are available,

to about 64 million pouncla in 1960. In moat year•, about 90 percent of

our entire conaumption of caahewa haa been in the form of aalted nut•

with the r ... inder being uaed in candy and baked aooda. Total caahew con-

aumption baa arown much faater than population, ao that averaae per capita

conaumption climbed from about .07 pound in 1932 to an all-time hiah of

about .40 pound in 1955. hr capita conauwption aiace 1955 baa run

•lightly under thi• record, and waa about .36 pouacl ill 1960.

About 80 percent of all auta produced in the Unitecl ltata• in recent

year• have been peaauta. The r ... illing production, accordi.na to available

clata, haa been div~ded .uaona th• four cClllll9rcially illlportaat tr•• nuta,

~ly (in order of importance) pecana, lqliah valauta, almonda, aacl

filberta (haselnuta).

In acldition to clomutic nut production, the Uuitecl ltat .. illlporta,

aa it• entire aupply, aubatantial quaatiti•• of the•• tr•• nut•: caahewa,

Brasil nuta, pi•taehioa, pipioliaa, ancl cheatnuta. Of the••, caahev• are

by far the moat important. Soma auppl-atal importa of pecana, walnut•,

almoaclll, and filberta uaually occur.

The per capita conaumptioa perceataa•• for peanuta aacl tr•• auta in

the United Stat•• •urina 1955-1959 were (approxillat• percentage•):

peam.ita, 74 percent; caahev•, 6 percent; lqliah walauta, 6 percent;

pecau, 6 percent; almoacla, 4 percent; filbert•, l percent; and other tr••

auta, 3 percent.

Th• relative importance of the variou• kinda of nuta for aaltecl uae

per capita waa aa follow• during 1947-1959 (approaillate percentage•):

/

4

peanuts, 71 percent; caahewa, 22.2 percent; almond•, 2.5 percent;

filberts, 1.5 percent; pecana, 1.3 percent; and other nuta, 1.5 percent.

R.elativ~ pri•ZH of peanute and important tree nute at wholeaale

during recent yeara have rank,ed aa follow• (in aacending order, to the r

higher priced nut•): :Runner peanut•, Spaniah peanuta, Virginia type

peanuts, caahewa. filberta, almonds, Bngliah walnuts, and pecana. No

long-time aerie• of official atatiatica i• available on retail nut pricea.

lecauae adequate retail price eatimatea were not available, the

analyaia waa baaed on "wholesale" price• paid by nut salter• and other

nut proceHora for their auppliea of peanuta and caahewa for aalting and

other proceaaiug into final fol'Dl8 in which sold to conaumera. Thus, the

demand relationahipa obtaiiaed reflect proceaaora' demand, not demand at

the retail level.

The moat useful eatimatea of demand and price relationahip• for pea-

nut• and caahewa, obtained in thia atudy are aa follow•:

:Demand llaaticitI with R.e•2,!Ct to: lCind of Hut Price of

Time and Own Other Period Form in Which Uaed Price Hut Inc om

1947-1959 Salted Peanuts -0.32 0.19 noae 1932-1959 Salted Caahew• -0.43 to none none

-0.50 1932-1959 All Caahew• -o.40 to none none

-0.50

(Note: "None" indicates that the related coefficient obtained i• not atatiatically significant.)

Por purpo••• of thi• the•i•, the form of certain relationahipa waa

explored, but the preciae nature of auch relationahipa waa not determined

becauae of the limited acope of the atudy. Aleo, certain unknowna re-

garding obaerved data muat be considered. Therefore, pending further

5

analyaia, tentative coneluaiona drawn from thia demand analy•i• are:

(1) per capita conaumar inc011111a have no atatiatically demonatrable effect

on demand for aalted peanuta or cuheva; (2) the e:xiatence of a com-

petitive or complementary relationahip between peaauta and cuhew• (u

aalted nuta) could not be eatabliahed; and (3) ,.ople tend to reduce

their per capita conaumption of aalted peanut• u the price of peanuta

riaea, but conaumption ia reduced at a rate much ... uer than the rate

of price increue, ao that ri•ina price more than offaeta fallina con-

aumption; thua, total receipt• to the peanut incluatry are increued

rather than clecreuecl, further, a aimilar ••t of atatementa •Y be made

concernina demand ancl price relationahipa for aalted euhewa, and euheva

i?'! all for.. The•• atat ... i.ta uy be aaicl to apply only withia;. moderate

ranau·of variation in price• &M quaatiti•• demanded, 'Ibey may not

apply outaide tka lillita of obaerved data on which thi• reaearch 1•

ltued.

The reaulta of thia reaearch, in ita prea•ut atage, do not auggeat

that aalted peanut couumption ia likely to be affected ill a manner

detrimental to the peanut incluatry, in the foreaeeable future, by mod•

erate price increuea, or by competition from cu'Mw nuta, u a reault

of the peanut price aupport and production coatrol proaraa, However, a

aubatantial apauion of world cuhew pro4action.la&a occu~r•tl in.the

recent put. Proapecta for further expanaion appear bright ill view of

the .. courag ... at currently provided by India'• pl-.. for total economic

arovth. A.fricaa production baa alao demonatratecl capability of aubatan-

tial expanaion. Accordinaly, a further increue in cuhew import• by

th• United Stat•• •iaht reuonably be expected.

6

IHTl.ODUCTION

Stat ... nt of the Problem

Concern that peanuta were poaaibly over-priced in the aalted nut

market relative to certain other aalted nut• believed to be competitive

with them had been expreaaed by th• peanut induatry and intereated aovern-

•nt agenci••· Since 1949, the price of peanuta baa been aupported above

th• equilibrium level. Uncertainty u to the effect of thia policy on

aalted peanut aalea wa• prevalent (13, pp. 1-11; 31, pp. 1-16; 35, pp. 44-49).

rer capita uuumption of peanuta u •alted nut•, and in total edible

uaea, wu relatively a table from the end of World War II through 1956,

while per capita couumption of cuhev kernel•, which were believed to be

a major competitor of •alted peanuta, wu in.creaaina. During the aam

period, peanut pric•• were increuing, and price• of cuhew• and other

auppoaed peanut competito.rs were alao increuina, but at •lower rate•.

(Cuhewa are priced higher than peanut•, but lover than other major tr••

nut•.) Accorclinaly, the differential between peanut price and th• price•

of theae competing producta appeared to be cloaing. Thia relative price-

couumption aituation for peanuta led to feam that, if it continued, th•

couumption of aalted peanut• would be adveraely affected in that their

relative price advantage would be weakened, reaulting in a relative lo••

of market to competing producta.

Uncertainty centered on the demand relatiouhipa 81Ei•tina among

aalted peanut• and their ua\llDICI competitive product•; therefore, the

inve•ti&&tion wu de•ianed to obtain information about the nature of aOll9

of th••• relatiouhipa, and thua help to auver the buic que•tion: "Are

7

••l•• of aalted peanuta being adveraely affected, relative to competing

producta, aa a re•ult of th• peanut price aupport program?"

Shelled edible peanuta in the United ltate• are uaed approximately

aa follow•: peanut butter, 52 percent; caacly, 20 percent; aalted nuta,

25 percent; and aiacellaneoua form, 3 percent. An additional quantity

ia bouaht by conaumer• aa routed in••hell peanuta. Competitive or

compl-ntary relatioaahipa amona the -jor encl uaaa are not known, ex•

capt for a aenaral belief that moat food.a are to aOllll degree competitive

with each other. (la• Tabl .. 21 and 22.)

"nl• uae of peaauta aa aaltad •helled nuta vaa of particular intereat,

becauae th• pr1-ry production of peanuta in Virainia aacl Horth Carolina

i• of the Viqiaia type, the moat popular type for •alting, Saltina i•

the main end·ua• for Yirainiaa. "nlua, the aalted nut trade relationahip•

are of areater intereat for purpoaee of thi• atudy th&ll tlw other major

end·ua••·

Por the yean 194i aad 1948 the price ratio• of the Virginia type

peanut• to caahev• vere 41 and 38 reapectively. liailarly, in the year•

1953 and 1954 the price ratia. var• 53 &Del 58 reapectively, thue indicat-

iQI that the price of peanut• had increaaed relatively to tlw price of

caaheva. "nle per capita couumption ratio• of aalt•d pe&DUta to caahev•

in 1947 and 1948 var• 410 and 346 reapectively. liailarly, th••• ratio•

for 1953 and 1954 were 313 and 263 reapectively. '?ha•• COllp&riaona

indicated that per capita c ... umption of cubev• vaa increaai.ng with re-

•p•ct to conaumption of aaltad peanuta. (Th••• ratio• were calculated

from information in Appendix Table• A and I.)

8

It ahould be pointed out that the aituation with reapect to per

capita consumption and price ri••• of peanuta and caahew nuta h.. cb&naed

•a.what aince 1956. At that time, a •ipificant chaqe in the level of

fara price aupport policy waa introduce4, mboclyiq a ahift from "old"

parity to "moclerni&ed" 'parity over a period ·of four yura. The net

effect of thi• vaa to reduce parity levela. In Uclition, the level of

aupport vaa re•uCeci durina thi• period, 1956-1959, from 90 percent to

75 percent of parity. (35, pp. 44-49) Thi• ci..aaae altered the •alted

peanut-caabew price relationahip from one relatively unfavorable to

peanut conau.11ption to one more favorable. '?he price ratio of Virainia

type peanuta to caah..,. fell from 59 in 1956 to 44 in 1959. Ha...,hile,

the per capita coaaU11ptioa ratio of aalted peanuta to caahew• roee from

265 in 1956 to 292 in 1959. Since the actual atati•tical analy•ia of

d...ad vaa not performed uatil 1960, th••• recent chaaa•• were included

in the &D&lyata reault•.

Objective• of the Study

The prlllary objective of tbi• reaearch waa to analyze the demand

and price relationahipe between peaa.ut• an4 their auppoaecl •jor com•

petitor in the aalted. nut trade: caah• kernel•. Secondary objective•

were: (1) to prepare .. complete a deacription .. poaeible of the world

caahew induetry, becauee auch information i• neceaaary for apprai•ina

the proapective auppli•• of caahev• that the United ltate• i• likely to

import in the f oreaeeable future (thia iaforaation ia found only in

widely acattered aourcea, and ia not readily available to the public);

and (2) to •wmarise relevant information oa the United ltatea' patterna

9

of peanut and tree nut production, couumption, and pricea, with emphuia

on the aalted nut trade. The latter would help to place peanut• and

caahwa in proper per•pectiv• relative to all uaea of th• major kincla of

nuta, eapecially the import~• of each kiacl of nut in the aalted nut

trade.

tt.thoda of Procedure and .Analyaia

Th• methodoloay uaed in analy•ing deaand aacl price relationahipa

conaiated of f ittina a aerie• of •inal• linear equatioiaa to the data by

ordinary l ... t aquar•• procedure• for both peanut• and c:aaheva. The

primary analyaia vaa concerned with th• uae of the•• RUta ill the aalted

nut trade. In the atatiatical approach, equatioaa were deviaed which

expteaa the effect of the followina aaaociated factor•, aaaumed to be

relevant, on peaaut aRCI caahew cODaumption aa -aaured by obaerved data.

(1) price of peanuta; (2) price of caaheva; and (3) diapoaable peraonal

inc ....

The aeconclary objectivea of thi• reaearch were to be reached by

compilina deacriptive iDformation from aeconclary aourcea. Th• portiona

of thi• iDf ormation reaarded aa relevant to thi• atucly are preaented in

the tvo deacriptiv• aectiona.

Three hypotheaea were form.ilated to auid• thi• reaearch, 1U111ely:

(1) chana•• in per capita conaumption of aalted nut• vary directly with

change• in level• of livina (conaumer illcOlllla); (2) aa the price differen-

tial urrow• between peanut• ancl cuheva, conaumen are led to aubatitute

caahew• for peanuta to a degree detr1-ntal to th• conaumption of aalted

peanuta, and converaely; and (3) aa price• of aalted peanuta (or ••lted

10

caahew•) ri••• people tend to reduce their per capita coaaumption of

them at a rate proportionately areater than the rate of riae in price,

thua leadin& to a dacliae in total racaipta to the incluatry; •imilarly,

u prie .. of th••• nuta decline, per capita couU11ptioa tend• to in-

cre .. e at a rate araater than the rate of decline in price.

In raportina the r .. ulta of thi• raaearch, the production and

.. rkating of cuhava in worl~ trad~ ia f irat daacribad with raapect

to bioloaical and techlloloaical ccnaaiclaratiou toaether with proc•••-

iq and Mrketing iaatitutiou and practice•. 'l'hi• ia followed by a

•~ry of information about peanut and tr•• nut production, couuap-

tion, uad price• in the lJaited Stat••, with emphui• on the aaltacl nut

trade. With buic information related to the probl• thua ••t forth,

the report move• to diacua•ion of the aaaly•i• of d...ad. for peanut•

ad cuhewa, ancl to th• concl.-iona drwn froa thia analyaia.

11

DllCl.IPTIOH or THE WOILD CASBIW INDUITl.Y.!/

Phyaical Cbaracteriatic• of the Caahew Tree and Rut (l; 2, aecticma 1 aad 2; 4, pp. 1-8)

The caahew tree, Aaaeardiua Occicleatale, belona• to the Anacardiaceae

family of plaata with about 60 1enara and 400 apeciea. Several economical-

ly important plaata auch aa the caahew, the piatac:hio nut, aDcl the maaao

are -'>era of the faaily, along with poiaon oak, poiaon ivy, and poiaon

aumac. The caahev •how• a •trona kiuhip with the•• diareput&ble couaiu,

in that ita nut •hell• contain carclol, a aubataace which produce• an

aller1ic akin reaction in •a.a peraOIUI who haaclle the raw auta. !hi•

reaction ia aiailar to but more .. v•r• than th• effect of poiaoa oak.

A native of lrasil, th• caahew tree ia DOV diatributed widely throuah

the world'• tropical r•aiona. Portua••• trader• and oolonisera, early

in the 1600 'a, i.Dtroducecl it into Mia, Africa, and the Par Kaat, to

check •oil eroaion. It 1laa proved ao adaptable that many people in th•••

areaa think it i• a native plaat.

1/ Thi• aection i• asyirtheaia and awmaary of available .. terial on production, proceaaiq, .. rketina, pricea, and couuwption of caahew nuta. It ia baaic back1round for an uaderatancling of economic• of the caahew induatry. Citaticma to available aource literature cannot be made for each •••t•RC• and para1raph, becauae of the proc••• of aynthaai•ina and interpretina material froa ••v•ral aourcea, which th• author haa followed throupout thia aection of the atudy. A a•neral credit citation to the aourcea 1• made for uch aubaection of thia aection. &efer•nc•• uaed in obtaining thi• information are liated in the Biblioaraphy--Literature Cited ••ct ion of thia atudy, under the aubheadiq ' .... e:i:iption of the World Caahaw lnduatry." lourc•• of atatiatica are credited in footnote• to tablea.

l2

The caahew tr•• i• an evergreen which grow• from 20 to 40 feet

tall, with a •pread approaching 60 feet. It i• •ubject to relatively

euy damaa• by •troaa wind•. It hu u exteuive root ayat .. ud

tolerat .. wide raaa•• in moi•ture, aoil type, and •oil fertility. It

do•• well in r•aiona where average annual rainfall raaa•• from 35 to

120 inche•, and oa aoil type• from aancly Co lateritic.. Although re•i•t·

aat to drouaht, it thriv•• b••t with an adequate water aupply, and

aucceaaful ca11119rcial culti•atioa dependa on regular ••uoaal raina

(auch .. the 11auoou of IQdia). It camaot withatancl froat. It hu few

peat and di••u• proltl••, the main one• being caterpillar•, "die•back"

diaeue, aud (in olcl tr•••) "bleecU.na" di•eue. Soil type and fertility

requir•••ta for the lll08t efficient caahew production are not knawll in

cletail at preaent. Ho 1tanclard •thod of cultivation ia pruently em-

ployed, and little r11<1earch baa been conducted on production problema.

In a few iutancaa where trie4, tr••• have beea obaerved to r .. pond te

cultivation and .. nurina.

Th• tree baa oval or oltovate l•ave• which are leathery, heavily

veined, 4 to 8 iuh .. long, and 2 to 3 inchea wide. rlower• are borne

at th• terminal• of th• current aeuonJ• ahoota, in cluater• 6 to 8

inche• lORg. The cluater i• COllp08ed of both uai•uual (•l•) and bi·

••xual flower•. Th• floweri111 period luta 2 to 3 moatu, and the fruit

mature• about 2 montu after ~loam.

Th• caahew fruit coaa iaU of the nut (th• true fruit) and the cu-

hn apple (a awoll•n fruit •tem, botanically). Th• nut ia borne on th•

end of th• cuhn apple. At •turity, the nut 1• l to 1 l/Z inch•• loua,

13

-.;eigh• about one•fifth ounce and u•ually i• kidney •haped. It• •bell is

about one-eighth inch thick, having a •oft, leathery, and oily outer layer,

and a thin, hard inner layer. Between the•• layer• is a honeycombed layer

with a re•inoua material which produce• a cuhew nut •bell oil. Thi• oil

i• of coaaarcial value u a dryina oil, in making •oap, paint, and other

non-food indu•trial products. On the iuicle of the •hell'• inner layer,

there i• a thin .._.,rane which •urrounda and ti&htly adhere• to the ker-

nel, or •••d. Bach nut hu one kernel.

The kernel i• the edible "cuhew nut" of c~rcial food value,

It i• kidney-•haped, 3/4 to 7/8 inch lona, white, aad fine textured. Its

flavor ia pleuing, but delicate and mild compared to other nuts. lternela

are mo•t frequently conaumed u 1alted nuts. Moat other conaumption ia

in candy and baked aoocts. (See Table l for a comparative aulyais of the

nutritional compoaition of cuhew kernel• and peanut•.)

The cul&ew apple, at aaturity, ia 2 to 4 inch•• loq, ancl its color

variea from nd to yellow to white. The •ture fruit is juicy, •oft,

and pleuina in taate. It may be eaten u freah fruit, but 1• more hiahly

valued u a j- or preserve. In aom producing area•, the native• make

a potent wine of the apple. In aeveral area•, native• value the apple

far above the kernel u a food.

M9thoda of Producf.na aav Cuhew Nuta (l; 2, ••ction 2; 4, pp. 4-8, 21, 32MJ3)

No •tandard, •yat ... tic 118thod ia pre•ently followed in cultivation

of the caahew tree. It i• planted in aardeu and in houae compounda,

intermixed with manaoea, coconut•, and arecanuta. Alao, it ia planted

14

Table 1. Nutritional Analy•ia of Cuhev :lernei. aa Compared with Peanut.

Amount 11-nt Uni ta Caahev reanuu

rroteiA ar- 18.5 26.9

rat ar- 48.2 44.2

rood Inergy calorie• 578.0 559.0

Total Carbohydratea arama 27 .o 23.6

r1ber Carbohydrate• ar- 1.3 2.4

Calciun ailliaram 46.0 74,0

rhoaphorua milligr- 428.0 393,0

Iron ailligr- s.o 1.9

Aah 1r ... 2.7 2.7

Thiaaiu ailliar .. 6.3 o.3o

Riboflavin ailliar ... 0.19 0.13

lfiacin ailli&r ... 2.1 16.2

Water percent 3.6 2.6

Source: u.s.».A. llllldbook a, "Compo•itiou of rooc1a--1.av. Proce•••d, Prepared," 1950, lur•au of Hom lcoaoaica and Bumaa 11utritioa, Depart-•nt of Aariculture.

in pl&1atat1oua, moatly in areaa which are conaidered unauitabl• for other

cropa.

The tr•• 1• uaually propagated by aeed, though thia may alao be done

by aaexual •thoda. When pl&1atatioua are ••t out, th• uaual procedure

i• to dia amall pit• 25 to 30 feet apart, at th• beainning of the monaoon

••aaou. Than, one or two dry caahev nuta (in •h•ll) are placed in each

15

pit, and the pit i• covered with •oil. The •••d a•rmin.ate• rapidly,

u•ually within two week•.

The crop receive• no further attention f roaa plaattng until harve•t

ti.ma, a• a rule. There i8 ••ldoa any fertilisati~u, 1."llt.eriq, or tillina.

Sometime•, thinnina of •••dlin&• or fillin& in aapa, a~ appropriate, i•

practiced, the object beina to have fin.ally about 100 tr••• per acre.

In •ome are&8, •••dlin&8 are •tarted, nur••ry·•t7le, and traaaplanted

to their permanent locatiou at •ix month8 of age.

C&8hew plantina and harve•t ••&8ona in the world'• -in comaarcially

illportant producina are&8 are •hown in Table 2.

Table 2. C&8hew Planting and Barv••tina leuou

Area

India 1&8t Africa:

Moaaabique Taqanyika

Plantiy Seuon

Juaa and July

September to December December to Karch

Rarv••tin& Se&8on

f ebruary to May

September to March October to January

Source•: Foreign Aaricultural Service, u. s. Department of Aari• culture; u. s. Couulate, Madr .. , India.

llow•riD& oc:cun about three month8 prior to harve•t. Light •hover•

at thia critical ti.lie are believed to aid in ••curina aoocl cro, yield•.

lxtended cloudy weather at flowerina ti.ma i• thouaht to reduce yield•.

The c&8haw tr•• aenerally beaina to bear fruit at 3 or 4 year• of

aae. Yield i• relatively poor the fir•t few bearina year•, but reache•

it• maximua level between the 7th and 10th year• of tree aa•. ror about

20 year• after thi• point, the tree yield8 a •ati•factory crop. Yield

decline• •harply after about the 30th year of aae, and eatimated life of

16

cuhew tree• in plantationa i• eatimated to be from 35 to 40 years. Tr••• which uo longer bear fruit are uaually cut for fuel, charcoal Mki.ng, and

other purpo••• auch u boat buildina and making packilll .. terial.

Caahw yield• vary widely, dependiq upon factor• auch u condition

of ~ree, weather, and crop handlina •thoda. A fair amwal averaa• yield

from a aood mature tree ia about 100 to 150 pound• of caahew apple• and

nut• toaetber. Thi• i• CompcMled of from 80 to 125 pounda of apple• and

from. 20 to 25 pounda of caah.W nuta (r• unahelled baaia). Th••• raw

nuta yield from 6 to 8 pouncla of cuhew kernela after proceaaiq. The

African crop ia not aatherecl until ~ ripena and fall• to the around.

Much of the Indian crop, however, ia plucked from the treu before beina

fully ripe, ruultina in the production of many 1.Jlmature, not fully formad

kemela, aacl in a 10 to 15 percent weiaht lo•• from the 1ubaequent dryiq.

Indian cuhew experta would like to diacourage early pluckiq. Thia

practice ia cauaed by taperina off of mov .. nt of African nuta to the

proceaaing factorial, before the Indian nut• are fully ripe, and the

heavy demand of proceaaor1 at thia tima. a.ported yielda per acre, even

from the .... locality, vary ao widely u to have little Malling. One

report from Iuclia, however, clou •ua&••t an averaa• per acre yield of

1,120 pound• of raw nuta.

Production Batimat•• for Kaw Ruta (2, aection 2; 4, pp. 2-12; 9; 10)

The caabev tree ia arown coaaercially in areateat volume in South

India aucl laat Africa. Only in the lut half-century, however, baa it

become coanercially important. It i• alao grown in 1ubatantial amounta

17

on the veat coat of Africa, on Maclaaacar, and in tropical AMrica from

Mexico to Peru and Brazil, incluclina the W••t Incliea. Braail and Haiti

are the heavieat pro4ucera in tropical AMrica.

Production of raw caahev nuts (uuahelled baai•) iD India and lat

Africa i• inclicated in figure 1 el'd Table 3. rortuaue•• Moambique

i• th• moat important proclucina area ill lat Africa. Britiah Taganyilta,

Zansibar, and Xenya produce ll08t of the r-incler of th• lat African

auta. South India produce• 80 to 85 parent of the Indian clomatic crop,

th• r ... illct•r bei.na produced in lollbay ltate and in the Portuau••• colony

of Goa (loeatecl on th• Malabar, or aouthvut, cout of India). Production

in India by ltat•• 18 indicated approximately by Table 4, ahowina clata

for the 1951•1952 crop aeaaon.

India'• total aupply and diapoaition aituation for caah9w nuta

(raw unahelled baia), for 1955 through 1960, i• indicated in Table S.

India import• ..at of the laat African crop ill raw, uuahellecl fora,

proc••••• it along with her own crop, aDcl thua move• into trade channel•

110at of the world'• aupply of cahew kernel•.

Caahew nut proclu~tioa atatiatic• for areaa other than India and

laat Africa (and for reaiou within Inclia ancl laat Africa) are acarce.

The .... atatement appli•• to domaatic caahew conaumption figure• in

producing countri••· Th• reported total production fiaur•• for India

and laat Africa are couaidered to be r ... onabl• ••till&tea, however,

A rouah approximation of conaercial cahev production ill ar ... other

than India and laat Africa can be obtained from the data in Table 8,

which ahow• United Stat•• .... rta of caahewa by countri•• of origin

1950 1951 19$2 U53 1954 l9SS 1916 1957 l9S8 l9St 1960

ipnl .. ea._ -.. 1a i.is. _. ... t unca. ''"·

19

Table 3. Production of Raw Cashew Nuts (Unshelled Basis) in India'}:/ and East Africa. Calendar Years, 1935-1960.

I India 2/ I East Africa i' Y,ar I (1000 lbs.) I llQQQ lbs.)

1935-39 Average 98,800 65,900 1945-49 Average 100,400 83,800

1950 112,000 151,700 1951 134,000 10,000 1952 126,000 118,000 1953 120,000 164,000 1954 130,000 156,000 1955 154,000 117,600 1956 156,000 155,400 1957 154,000 214,800 1958 146,000 269,600 1959 146,000 202,400 !26Q l441 QQO ~31 000

1/ 1965-1966 production goal of India's third Five Year Plana 336 million pounds.

'JI. Includes Portugese colony of Goa (on Indian West Coast). ~ Indian imports as raw nuts from East Africa. Sources foreign Agricultural Service, u. s. Department of Agricul-

ture (9J 10).

Table 4. Production of Raw Cashew Nuts (Unshelled Basis) in India, by States. Crop Year, 1951-1952.

State

Madras 'JJ Kerala Y Bombay Others

Total

I I

Production (lQOO lbs,)

66,000 40,000 9,000 51200

120.200

l/ Madras State divided in 1956 into Andkra and Madras States. Under this division, most cashew production is located in what is now Andkra State,

~ Kerala State was known as Travaneore-Cochin before 1956, Sources Report of Indian Council of Agricultural Research, New Delhi

(2).

20

(on the •helled, or kernel, buia). Th• United ltate• conauma moat of

th• world'• aupply of cuheva, ao the•• clata are the beat eatiutora

available for cuhw production outaide of Iudia _1.lld Jut Africa. Th••• data •how that in 1956, for example, the Unit~~ Stst•• received the

following quantitiea of •helled caahew kernel• from ar ... other than

India. Inclian ahipMnta repreaent moat of th• lut African u well u

Indian production of raw cuhew nuta. Production of raw cuhew nuta in -th••• ar ... can be ••ti.mated by 1111ltiplying the quantiti•• of alaalled

kernel• by a converaion factor of 3.81, baaed on 2000 pcnmcla of raw nuta

equal to 525 pouncl• of kernel• (9).

United Stat .. lllport• of Shelled Cuhew• (other than from lDclia), 1956

Area

Moaambique Portuaue•• .u ia lraail lriti•h But Africa Haiti Other Countri••

Proc•••iq of Cuhw Kernel• (2, aection 2; 4, pp. 21-30)

Pouada

1,490.918 1,108,150

384,991 324,350

74,945 114,968

The moat important area for commarcial production of cuhew kernel•

i• South India, not only becauae of it• large domeatic raw nut production,

but alao becauae it proc••••• and move• into world trade moat of the

world'• aupply of cuhew kernel•. In addition to handling the domeatie

crop, the Indi&D c-uhew proceaaora illport the Mjor portion of the lut

African crop in the raw, uuhelled fora and. proc••• it. The lndi&D and

lut African crop•, rouahly equal in aiae, together account for moat of

21

the world'• cosmarcial aupply of caahewa. Thua, South India ia, iu

effect, the world'• .. jor •uppli•r of caahew kenaela.

Pollowina harveat of rw caahew uuta in Iaclia, a major part of th•

crop i• •old by farmar• to itinerant dealer• who 10 from houae to houae

durina the -rketiq ••aaon·. A ... u quantity i• diapoaed of by far.an

at th• primary Mrket center•, but moat farmer• feel that they have too

little produce ud too long a diatauc• to 10, to JUltify the trip.

Parmar• who make thi.a trip •ell their produce to itiaeraut dealer•, al•o.

Whol••al• •rcbanta aucl aaau of proc•••or• are ••t up for buai-

ne•• in the primary .. rketa, to obtaia raw nut •uppli•• for the factorial

to procea•. The•• aa•nt• provide keen competition amoaa tbemaelve•. Thay

contact the itineraut •rchauta who have acted aa aaaembly firm, uaually

throuah broken, aad arrange for purchaae•. 'I'll• itiaerat mrchallt•

arranae to •upply •pecific quaatitiea, and they receive illlmadiate pay-

mant. Th••• deal• are cloaed without the ,.rcbaaina aaeuta •••ina a

aampl• or otherwiao checkina the quality of the uuta. Buyer• in the

primary marketa dry the nuta before ••Ddina th- on to the procuaiq

factori••·

Th• broker• ancl iti.Mraut •rchanta ill thi• market atruoture

practically dictate the price, aince competition between procuaiq fisma

i.a 10 atrong. rarmr• who arow the nuta receive little benefit froa

thi• competition, however, Lack of .. rket information and little COii•

petition betwea itinerant •rcbanta when buyiug the farman' produce

place the farman at the marchanta' •rcy in price determination.

Ille Af ricu raw caabev uut crop llOV81 into th• handa of Indian

procuaora throuah a few illportiq firma located in Bombay. Competition

22

i• weak a.mg th••• firma. In additioll. th• •trona competition between

procaaaora and the lack of other market &ltarnativaa for la8t Afriea.i

arowara (little proce••ina industry baina available to t1ae arowera

other than that in Inclia) aive to the loabay importer• moat of the

baraaiaina power in clatarmiaing price• of raw African caahew nuta.

Procaaaora• demand for African mata variaa aOIMIWbat froa yur to yur,

and it clepencla uinly on Indian cla.eatic mat productioa and oa the world

export cl-IMI for cuhw karnala.

Owner• of proc .. aing factori .. place their ordera for r .. nut• with

the import fil'IM. Thea• than arrua• the required import ...,unta through

their branch•• in lat Africa. 'l'ha tranaacti01l8 are aettlad on a forward

delivery buia in Auaust aacl Septaaber, before th• Afriua harv .. t aeuon

opena.

Neat of the Iaclian cuhw proc•••in& factoriea are located at Quiloa,

which hu 150 of them. HD•t of th• raat are at Calicut and Maaaalore.

Th••• factori .. are operated by aull firm, usiq .,.tly hand labor

•thod.a. Thay usually operate for oaly niM to tea moatha per year.

rroceaaiq bagina with the arrival of the first African auta, usually

in 1'ovembar or December. The African crop ia finiahacl by the tiM the

Indian crop beaina to move in March. The proc .. aiag .... Oil end.I about

September. '?hi• aeuoul proc•••iDa pattana hu caused a aerieus labor

probl- for the industry, •iae• laborer• ... ire to have yaar-arouacl •-

plo}'Mllt. Ou aolution bein& propoaecl for th• dilemna by the llldi&D

Council of Agricultural .... arch and aoma 11118mbara of the cuhew tr&cla

call• for the arowing of more cuhew nuta in IIMlia, to help 1laka poaaible

a full year of o,.ratioa. A fear uiata that the time uy coma when a

23

proceaaing induatry i• developed in laat Africa, and the African raw

nut aupply loat to the Indian proceaaora (2, aectiou 2; 9; 10).

Lack in But Africa of a lara• aupply of cheap labor comparable to

that in India baa ao far prevented th• develo,...t of an African caahev

proc•••ina induatry. Caalutv nuta, becauae of their kidney ahape, have

thua far r .. iated the perfectiou of a machine ahallina proc•••· Only

'haacl •helling ••- to yield unbrokea kernel•. lvea ao, there are pro•

duced -Y brokeu kel'Mt• which ••11 at heavy diaeouut. Tbua, a larae

aupply of c~up hand labor remaina an eaaential f aotor of production in

the caahew nut proceaaina induatry,,.ancl keepa it centered iD India.

Moat of the inclut1try'a laborera are woman.

Th• atepa ia proc .. aina caalutv nuta are aa follow•:

(1) Routiy. 1o .. tina ia done to remove caahev •hell oil, aave

aa aaoh of it u poaailtle, and make •helling eaaier to acc0111pliah. Four

•thocla of roaatina are uaed: opea pan, urthemar .. , rotary cylinclera,

ancl oil bathe. Th• f irat two •thod.a are quite aillpl• aad an the moat

widely aclopted in proeeaaiq factori••· 'l'hey are cheap and iuvolve little

capital outlay. Tbey provide no aatiafactory way to recover the nut

ahell oil, or to protect worker• from the oil ancl fume• which .. cape

durina roaattna. Soma illprovemnt reault• from uaiq the rotan

cylinder routiq .. thod. It providea efficient roaatina and hya••ic

worki.q couditiou, but loa•• moat of the ahell oil. It require• cou-

a iclerabl• iuveatmant of capital. '1'he oil bath roaatina .. thocl c.iaiua

aOCHI roaatina, aanitary working couditiona, ancl uxiam ahell oil

recovery. Ill apite of thi• efficiency, it i• at preaent too coatly to

be widely adopted by proceaaing firm. Ita acceptance ia reurded by

24

th• nec•••ity for heavy capital illveatmeat ia machinery, and by the

abundant aupply of cheap labor in India. The oil bath roaating •thod

involve• a bath of caahew •h•ll oil, who•• t..,.rature ia •illtained at

about 425° lahrenheit. The raw caahev auta beina r ... ted are held ia

vi~• tray• and paaaed through th• hot oil bath for about one minute,

During thi• time, the heat of th• bath oauaea th• oil cell• of the raw

aut •hell• to burat &ad rel ... • their oil iato the oil already ia the

bath. Aa thi• occura, the oil bath overflow• aad ••••• oil ia c•ll•ctecl

for aal•. About .015 ouDC• of oil i• recovcl'll!J froa each nut, oa the

average. '?hi• repr .. enu •lightly l••• thaa half the oil content of

caahev aut ahella. lillultaaeoualy, the nut •h•ll• are roaatecl to a de·

ar•• which aida in their ramoval froa the kernel•.

(2) Shellig. lhellina follow• roaati.Da. in the caahw r>roc•••ina

aequence. It maat, ao far, be done by hand to ainllliM kernel breakqe~

Ivan by hand, it call• for apecial care and •kill. The kernel•, aa rUK>V8d

from the ahall•, are covered with a thin, brovniah •kill (or pellicle) which

muat be removed before the kernel• will be fit for human eonaumption.

(3) BlanchiD&• Blanchina 1• then performed. to looaen th• pellicl••·

Thia ia dona by clryina the kernel• ia either the 8\lll or apecially con-

•tructed hot air chamber•.

(4) rellicl .. are tun euily removed. Yield of kernel•, by w•iaht,

i• roughly equivalent to 31.l percent of th• wetaht of raw, \lllahelled nuta.

(S) Qraclig of kernela i• next. Xernela are now very dry and brittle,

ao they are treated with moiature to minimise breakaa• durina gradina.

Gradina ia then done by hand. Eernela are aorted firat u to whole ker-

nel•, broken piece•, and acorched (over-routecl) kernela. lubaorta are

25

then .. c1e by •i•• of whol•• OD a count per pound baaia, larg .. t kernel•

beiq ccmaidered top quality. Piece• are divided into fancy &JUI amall

piec••• butta, alUl •plita. Scorched nuta are aorted into whol .. , butta,

aplita, and piece•. (lea Tabla S for asa inclication of how yield typically

runa, by grade•. Th• ,.rc•ntaa•• •hawn are baaed oa th.a run of caahew

kernel• imported to the United Stat•• throuah Nev York in early 1950.

Sine• th• United Stat .. i• the world'• maia c:cmaumr of caahew kernel•,

and Nev York 18 her main entry port for caahewa, thia i• ccmai .. red a

fairly accurate inclicator of caahaw kernel grade yield in a•neral.) The

overall average breakclolnl by araclea of caahew kernel• .. Y be rouahly

aU1111&risad al follow•:

All whola arad•• of kernel• (except acorched) All arad.. of piece• (except acorched) ill acorchecl karMl• 320 • count whole• (th• moat BWl9roua arade) rancy piece• (the ••concl moat nummroua arada)

Percent 60.9 26.4 12. 7 34.1 15.2

Thi• arading •1•tea haa bean widely adopted &DAI appear• to be ••tiafaotory.

(6) Packiy. l.anaela are now packed for the export trade (into which

ll08t of thea move) • 'Ibey are packed in 25-pouncl tiu (from whcl.ch air 1•

removed ud raplacacl by carboD dioxide aaa to prevent apoilage). lpoilag•

due to iuac~ dama&• waa a ••rioua probl.. in the caahew trade until the

middle 1920 '•. Hotha ancl beetle• were layina their •u• in the kenaela •

and th .. • •&a• were hatchina while the kernel• were being •hipped, leading

to voraineaa, apoilqe, &DAI poor acceptability to the trade and to couumra.

Introduction of •••l•cl tiu with air replaced by oarbon dioxide gaa araatly

eaaed th• inaect probl•, and th• caahew tracl• 1mltiplied, with a product

highly deairabl• to couumera. In apite of th• improved packina -thod,

however, buyer• of caahev kernel• atill aometimaa complain about vormin•••·

26

rroeeaaor• are beiaa uraed to r ... dy thi• 1ituation by (l) illproviaa

factory aanitation, (2) 110re uae of improved tin cau, (3) more uae of

the improved packiaa -thod, and (4) acloptiq UD.ifora arade ltandard•

in all proee1a1111 plaata.

(7) The fiaal •tap in caahev kernel proce••iaa ia packiy for ah1e-

•1at, into wooden boau. lach box coataina two 2.5-pouncl aealed ti.DI. -Kernel• are •hipped to the United ltatu and other conaumiaa couatri••

in thi• fora.

Table 5. Cuhav lluta (Kernel•): Perceutaae of Total Quantity Imported falliq into lach Grade; Bev York, Averqe of

Jaauary, March, and April, 1950.

Grade

Whole• (approximate max-ima count per powad):

210 240 280 320 400 450

Butta Split• l'ancy liecea Small Piece• Scorched

Whole• But ti 8plita Piece•

Uudeterainecl u unaelectad!.I Total

Percentaae of total quantity

1.9 4. 7 1.9

20.4 3~4 4.2 2 .. 7 3.2 9.1 0.8

4.8 0.2 o.4 2.2

40.0 100.0

lJ It can be u1um• that thi• aroup conai•ta laraely of aradea of nut• in the proportion of aradea ahown.

Source: u. I. Tariff C....Uaioa, ''lclible Tree lluta" reporta.

27

World c .. hev Trade Pattel'D8 (l; 2, aectiona 1 and 2; 4; 5; 1; 8; 9; 10; 11; 12)

Th• world'• c-rce in c .. hew k•rn•l•--procluction, proc .. ai.Dg,

exportiq, importiq, and conaumption•-can be cleacribed with fair --

pleteneaa by diacuaaiq the data in Piaurea 2, 3, 4, and 5, and in

Tabl .. 6, 7, and 8. India proce•••• and exporta the major ahare of the

world'• aupply, and th• United ltatea ia the world'• main importer and

conaumar of c .. hw kernela •

Production of raw caahew auta ia conceatrated maialy in India and

1 .. t Africa (primarily Mouabique, with l••••r quantiti.. from Tuaanyika,

Zan•ibar, and X.aya), aa iadic:atecl above in Piaure 1 and in Tablea 2, 3,

4, and 6 and th• accompaayiq tat. 1 .. t Africa doea little proc•••ina

of it• c .. hew crop, but exporta moat of it to India for proeaaaiq and

diatributioa of kernel• and nut •h•ll oil. The Indian incluatry handle•

the•• fuactiona for both Indian and lut African raw cuhew aut cropa.

lmall quantiti•• produced aad proc••••d in certain other countri••

are believed to lte iadicatecl with fair accuracy by the data in figure 5

and in Tabla 8, ahoving 8llO\lllta of cuhewa imported by th• United Stat••

froa varioua couatri•• of ori&ila of import•, aine• the United ltat•• ia

th• maila importer aacl con.au.er.

The world picture of cubew kernel illporta and conaU11ption, by

couatri ... ia indicated with a fair dear•• of completaneaa in Table 1

and r11urea 2 allCI 3, ahoving Inclia'• uporta of cuhew, by eountri••

importing t~, 1ine• India ia the main proceaaor and exporter of c .. hew•

in th• world. Th• United ltatea, th• United Xiqdom, Canada, Auatralia,

28

th• Soviet Union, and certain countri•• of the C0811Uni•t Bloc are the main

importer• and couuman of caahaw•, with tha United State• uaiaa the large•t

portion. Cuhaw kernel import f ipre• lm18t ba accepted u the •uure of

"apparent COD8umption", •inca no •tati•tic• are available, for the import-

iq countria•, on baaismiq and carryover •tocu, and there i• no •.-•tic

production in th••• couatri•• recaiviaa cuhaw• fr• India. Thua, the••

"iaporu fi-om India" data are the beat (and only) available .uure of

cuhew cOD8umption in mo•t countri•• which import their aupply froa India.

The couumption-illport picture for tha Unittkl ltat•• i• available in

•lightly more complete detail, •inc• thia country doe• receive a few ca••

hew• from countriu other than India, and maintaina atati•tica thereon

(aee Piaur•• 4 aad 5 aad Tabla 8). Data on internal couumption of cu•

haw• in produciq countri•• are quit• •carca. (lee Tabla 6 for an indica•

tion of India'• internal ca•haw coua1.111ptioa.)

Tabla 6. Caahew Nuta (Uuhellad luia): Indian Supply ad Diapoaition, 1955-1960 Calendar Year..

: Openina: : Imporu: : : llMlina : I tock• : Indian : (from : Total : : Internal : Stock•

Yaar:Jan. l :Production!/1Africa):lupplx:lxporta:CouU9tio1uDecamber 31

- ---- Tbouaanda of found• -

1955 54,000 154,000 117,600 325,600 296,800 ll,200 15,600 1956 15,600 156,000 155,400 327,000 311,000 14,000 2,000 1957 2,000 154,000 214,800 370,800 325,200 21,600 24,000 1958 24,000 146,000 269,600 439,600 372,969 11,200 SS,431 1959 55,431 146,000 202,400 403,831 358,871 11,200 33, 760 1960 33, 760 144,000 223,000 400,760 341,152 11,200 48,408

l/ Incluclu Goa. Source: roraian Agricultural Service, u .•. Departmallt of Agriculture

(9; 10).

29

-------------------------------...,!

• ~ ,... t .

f:i Sl

...

J ! ! J j : I 41

/ I a c I ...,

'i 1 • a I • t"'l, ,...

1 • I • i ""' " ... ... • Sf!t f I " N f( ~ ~ 0 •• I a

I J

30

a.ct~ ol ca._ lan1l• ,.._ Wia, - rt.e• of '*''°"' ._1 A ....... ••n to ...._ ltst-l st. --.i. 1.

31

i ~ . .

32

... 1 .. 10

l'OR~~··· AllD ... 1 .. 42.1

ft.au• J,.. x.,ona of t:••Mw -. .. 1. to tho Vid.tc it••••• 1'f ('oqtrf.•• of 0..1110, A.wop ••n.ataa• fl'S Baelt, ltS6•1·teo.

Table 7. Cashew Kernels.!./: Exports from India, by Countries of Destination, 1937-1959. (Quantities in thousands of pounds.)

Exports to: Other

U.S. : : U.K. : : Canada: :Australia: :U,S.S.R.: : Countries Total :United:as ')',of: United:as ')',of: :as ')',of: : as % of : :as ')',of : Other : as ')',of

Yearll :Exports:States: Total :Kingdom: Total :Canada: Total :Australia: Total :U.S.S.R. : Total :Countries..'.?./: Total

1937-39-Y 1946-47 1947-48 1948-49 1949-50 19)0-51 1951-52 1952-53 1953-54 1954-55 1955-56

19.J6 1957 1958 1959

28,868 33,367 36,608 40,227 41, 741 55,865 46' 776 61,373 58,586 76,186 69'133 56,056 76,227 87 ,461 84, Li5

23,962 28,978 24,114 36,201 33,299 45'133 32,120 43 ,072 42,218 60,884 54,673 39 ,073 56' 773 61,234 57,956

83.0 86,8 65.9 90.0 79. 8 80.8 68.6 70.2 72.0 79. 9 79 .1 69. 7 74.4 70.0 68.9

1,472 1,162

10,523 2,143 5 ,309 8,510

11, 777 15,462 12,005 9,592 6,836 6,446 6,142 5,990 4,847

5.1 3.5

28,7 5.3

12.7 15.2 25.2 25.2 20.5 12.6 9.9

11. 5 8 .1 6.8 5.8

713 1,474

319 627

1,247 746 979

2,189 2,361 2,125 2,493

)I SI SI °"ii

2.5 4.4 0.9 1. 6 3.0 1. 3 2. 1 3.6 4.0 2.8 3.6

51 s1 SI °"ii

169 931 719

51 °"ii

598 770 108 909

1,056 1,241

51 SI SI °"ii

0.6 2.8 2.0

31 }j

1.1 1. 6 0.2 1. 6 1.4 1. 8

51 s1 SI °"ii

51 SI SI SI SI SI SI SI SI SI SI "ii

4,636 11, 232 9,824

51 SI SI SI SI SI SI s1 SI SI s1 °"ii 6. 1

12.8 11. 7

2,352 823 933

1,256 1,885

878 1, 131

'.>43 1,093 2 ,529 3,890

10,538 8 ,677 9,005

11,527

8.8 2.5 2.5 3.1 4.5 1. 6 2.4 0.9 1. 9 3.3 5 .6

18.8 11.4 10.3 13. 7

11 These figures must be accepted as representing (for countries o t her than the United States) total cashew ke rnel import and consumption data (since India is the world's primary processor and exporter) Import figures are Lhe bes t available measure of "apparent consumption."

21 Indian fiscal years, April 1 to March 31, through March 31, 1956. 1956 figures are for March 31 Lo December 31 . 1957 through 1959 figures are for calendar years .

]J "Other Countries" include (especially) East Germany and certain other Communist Bloc countries; also, for cerLain years where separate breakdown is not available. Canada, Australia, and U.S.S.R.

41 Average of fiscal years 1937-38 and 1938-39. No earlier statistics are available . SI Figures not available. Sources : United States Bureau of Foreign Commerce ( l l); Letter to author from t he "Cashew and Pepper Expor t Pro-

motion Council," Cochin, India, 1957.

c..> w

34

Table 8. Cuhew larnela.!/: Uuitecl State• Importa!I !and Apparent Con-aumption).~/, by Countri•• of Oriain of lhi,..n~/. 1931•1960.

(Quantitiea in Tbouaan.S. of Pouncla).

s 1URited Stat•• lmPorta bl Countri•• of Ori&in of lhiD111ats : u.s. : India t : rortuaue••: : lloUllb ique

Total :u i of:Portuau•••:Aaia u 1 : u 1 of Year: l!porta: India: Total Aaia of Total 1Mouabigua: Total

1931 10,524 10,398 98.8 7 0.1 ---1932 9, 799 9, 722 99.2 34 0.3 1933 ll,691 ll,408 97 .6 176 l.5 17 0.1 1934 14,899 14,611 98.l 151 1.0 1935 22,376 22,225 99.3 42 0.2 1936 22,102 21,804 98. 7 --- --- 4 1937 26,848 26, 748 99.6 13 1938 26,069 26,002 99. 7 6 --- 2 1939 29,466 29,440 99.9 ·-- -- ---1940 28,940 28,717 99.2 6 --- -- ---1941 35,592 35,322 99.2 74 0.2 -- ---1942 17, 721 17,662 99.7 --- --- --1943 3,542 3,116 88.0 347 9.8 -- ---1944 15,;79 14, 736 93.4 492 3.1 1945 24,502 23,151 94.5 153 0.6 ll ---1946 29,898 28,514 95.4 620 2.1 16 0.1 1947 29,902 29,939 94.3 742 2.3 -- ---1948 34, 712 33,268 95.8 994 2.2 7 ..... 1949 36,650 35, 723 97.5. 799 2.2 -- ...... 1950 48,482 46, 776 96.5 1,443 3.0 -- .... 1951 S0,504 48,171 95.4 1, 712 3.4 478 0.9 1952 42,071 40,365 95.9 925 2.2 727 l. 7 1953 47,709 45, 715 95.8 830 1.7 1,072 2.2 1954 56,551 53,579 94. 7 877 1.6 1, 772 3.1 1955 66,396 621 751 94.S 1,470 2.2 1,535 2.3 1956 56,279 52, 780. 93.8 l,~ 2.0 1,491 2.6 1957 58,396 s5.142 94.4 7 o. 7 2,588 4.4 1958 66, 771 62,855 94.2 987 1.5 1,846 2.8 1959 63.351 60,331 95.3 279 0.4 1,940 l.l 1960 64,339 59,085 91,8 1,592 2.5 1,897 ' 2.9

35

Table 8. (continued).

:United Stat•• X..Ort• bx Countrie• of Or!lin of lhi11111nt: . . : : Britiah : . . l Other . . . . : Braail: lriti•h:I. Africa: : Haiti : :Countrie• :u I of: But . u t. of :u I of: Other • u 1 of . •

Year:lraail: total :Afric.2,/: Total :Haiti: total 1Countriea1 Total

1931 2 --- --- 43 0.4 75 0.7 1932 14 0.1 ......

' --- 3 ·-- 25 0.3 1933 --- --- 32 0.3 58 o.s 1934 ...... --- 11 0.1 106 0.7 20 0.1 1935 18 0.8 35 0.2 56 o.3 ...... 1936 153 0.1 33 0.2 65 o.3 42 0.2 1937 37 0.1 14 0.1 22 0.1 16 0.1 1938 1 .... 4 45 0.2 3 ---1939 ...... ...... 14 l3 .. .... ---1940 203 o. 7 14 ...... ---1941 --- --- 18 .. --- 177 0.5 ...... ---1942 47 0.3 11 0.1 --- ~--

1943 --- ...... ' --- 79 2.2 ---1944 462 2.9 23 0.1 65 0.4 -·· --· 1945 926 3.8 66 0.3 195 0.8 --- ....

1946 490 1.6 99 0.3 159 o.s ....... ---1947 1,005 3.2 26 0.1 26 0.1 ....... .. .. 1948 377 1.1 4 ...... 32 0.1 30 0.1 1949 83 0.2 ..... 40 0.1 5 .... 1950 82 0.2 ..... 172 o.4 9 .. ... 1951 20 --- --- --- 123 0.2 ..... .. .... 1952 23 0.1 ...... --- 30 0.1 1 ..... 1953 26 0.1 40 o.·1 7 ..... 20 .. .... 1954 25 ...... '292 0.5 7 .. ... ---1955 50 0.1 585 0.9 5 .... -·-1956 385 0.1 324 0.6 75 0.1 115 0.2 1957 8 ...... 272 0.5 --- .. .... ...... 1958 7 ...... 404 0.6 100 e.1 572 0.9 1959 149 0.2 393 0.6 1 ..... 257 0.4 1960 1,203 1.9 334 o.~ 140 0.2 86 0.1

!/ All world trad6 in euhew• i• handled. in the kernel fora, accord• ina to available atat_iatic•, except for lnclin hlporta of raw l~t Africau nut• for proc•••iD& .. , reentry into world trade u kernel•. Primary producizaa countri•• i•~•ut Africa are MosaabiQu• and Taaganyika.

36

Ta~l• 8. (continued).

1:.1 Illpor.t figuru are baaed oa "general importa•• data for 1931, 1932, 1933, an4 1947, and cm "importa for COUUlllptioa" data for all other year•. "General illporta• are •rchancli8e entered for 1-diate ccmaumption cm arrival, plU8 •rchaa4i•• entered for atoraa• in bontl.ed varehoua••· "lllpctru for COD8umptin" are .. rchandi•• enterecl for 1-di&t• COll8Ullp• tioa, plU8 witWraval• froa bonded warehoU8ea for COUU11Ptioa. "lllport• for couumptioa" differ from "aeneral imperta" to the extent that •rclumcli•• entered for •toraae diffen from varehoU8• witWrawal• for ccmaU11ptin in any given period of tt..·. Thi• difference i8 U8ually •mall in the cue of cabev kenael8, anti th• difference• from one year to another tend to offaet each other.

3/ Cuhew kenael import f igur•• are aeceptecl in the United. ltata a the •aure of "apparent conaumption." lfo etatiatic• are available on begimliq ad carryover •tocka, there 1• ao domatic caahaw production, ancl any re-export• of imported kemal• are removed. from thee• data. Thua, they are the beet (and only) available MUure of American calunr cnaump-tioa.

4/ ''Countri•• of oriain of ahi.,..nt" import •at• ••rve u approximate indieatora of pr.Suctiea and proce••in& of cahaw• ia couatriaa other than India, •i.Do• the United Stat•• ia the uin couumiq country for cu-hw kal'Mla. Data on illporta by U. S • .f'rem India indicate the lar ... t a hare of cuhewa proceaaed in India (••• '!'able 7 for U. S. a hare of all cuhw export• from In41a). Indian proceeeing of caahaw kenala i8 baaed about equally oa dommetic crop production and cm the lut African crop (which 1a illportad to llldia for proc•••iq). Thua, Tabl .. 7 au 8 toaether approximately indicate th• world pattern of producticm and pro• c .. •ina of cahwa.

i./ r11urea oa ''Britiah lat Africa" iaclucle importa froa Tanaanyika, Zaastbar, and lanya.

Source: United ltat .. Bureau of the Ceuua (7; 8).

India an4 Uaited ltat•• Cahaw Trade Chanael• &1ld Procedure• (2, ••ction 2; 4, pp. 30-32; 5; 99 10; 12)

Marketing of Indian eaahw kernel• throuah export ch&Dael• i• carried

out by th• proc•••ina firm 1 u a general rule. lomm of the laraer pro•

ceaaora have their own broker• in major importing perta, euch a Rew York.

Other proceaaora ccmbiae for coordinated urketing arraaa-nt• on a

aiailar bui•; Still othen U8e th• ••rvic•• of export broker• in Boll-

bay to .. rket their kernel• in the export tracle.

37

A&•nt• of proc•••or• contact (and are contacted by) agent• of impor-

ter• of th• conauaina countriea, eapecially thoae of the United ltatea,

to neaotiate ordera. Proceaaora' aaenta alao keep their principal• in•

formed aa to caahew kernel •tock•, c1 ... .t trencla, ad price trenda.

Typical brokeraa• f••• paid by proceaaon for their agent•' ••rvic•• run

frOll l 1/2 to 2 1/2 percent of total value of 1al•• made by the aa•nt•. Importer•' agent• are of two typea: (1) buyer• for large aalter1

and other final proce11ora, who purcha•• a lara• portion of their caa-

hewa directly throuah Indian procea1or•' broken without dealina with any

intermediate illportina firma; and (2) impo~tina firma which obtain entire

1uppli•• for amaller f iual proce11ora and auppl ... ntal 1uppli .. for

laraer final proceaaora.

The primary caahew export center i• Corbin, on the India Weat Coaat.

Th• primary caahev kernel import center ii Nev York City. Indian caahev

proceaaora and their broken, workiq with the Governmnt of India'•

advice and encouraa ... nt, and with India pepper intereata, formd ''Th• Caahew and P.epper Export Promotion Council," with headquarter• at Cochia

in 1955. The Council'• purpo••• are to aclverti•• it• producta better in

world marketa, increaae export aalea, and coordinate trade more efficiently.

When aaenta of Indian caahev proceaaora amt United Statea importer•

contact each other, they negotiate orden primarily on a ''t .1.r. New

York (or other importina port) Baaia". Thia •&na that the pricea aareed

on by ••ller and buyer include coat of the proc••••d kenaela in India,

plua inaurance and f reiaht chars•• for 1hipment from India to the import-

ina port. The•• neaotiationa are moat frequently carried on in the im-

porting porta (eapecially Hew York), but aome of them are aettled in the

exporting porta.

38

Importer• uaually place their caahew kernel order• •everal ll01ltha

in advance of de•ired delivery dat••· for example, order• for March

delivery -Y be placed duriq December, .January, ancl Pebruary, at

different price level• over time of order plae ... nt for each arade of

cuhew•. IIMlian •hippen (proce••or•) ueually procu• ancl pack cuhew

kernel• oDly after receiviaa •uch order•. They do not ueually prep&re

etock• in advanee of receipt of definite orden.

I.a previouely •tated, the lara•r ealten and other final proc•••or•

of cuhew kernel• in the United ltatu purchue llUCh of their •upply

(about half) directly throuah broker• workiaa u aaenta of IIMlian pre-

c•••ora, without dealiaa throuah any intermediate United ltate• illport•

ina firm. Such illportina firm clo, however, obtain auppl ... ntal cu-

hew euppliu for the lara•r •nd-ueer•, and entire euppliu for •maller

and mediua-•i••d •al ten and other end-ueer•. Th••• illporten· ••ll caa-

hew• directly to medium ancl larae-aized end-ueera, and al•o u•• the ••r•

vice• o~ da1111atic broker• in the United Stat•• to •ell cuhew• to amaller-

eised •alter•, c&Ddy maker•, and baker•. lame aalu to mediua-•i••cl

elMl•ueer• are al•o aacle ill the latter way. Illporter• ••11 dock-aide u

many of their cuhewa u poaeible, placiq the reat into cool etoraa•

until a buyer i& fOUIMI.

Moat -'-ricaa cuhew importer• handle a nwaber of other comnocliti••

alao. Moat of thea handle all kind• of nut• (both •helled and in-•hell),

ancl many aleo baadle dried fruita and other iteu. Th• illportanc• of any

•inal• fira in the cuhev illlport trade i• difficult to Juda•· Percentage

of the total cuhew trade handled by each firm varie• areatly from year

to year. In IOM Y••ra, a •iqle firm may briaa in u aich u 15 percent

39

of the total cuhew kernel importa of the U'Dited Statea. Moat importer•

are referred to by the nut trade u ''medium aiaecl" firm. They finaac:•

their opera~iona laraely with borrowed capital.

Moat caahev kernel• imported to the United ltatea are conaumad u

aalted nuta. Nut aaltina firm obtain an average of about 90 perc:ent

of each year'• aupply of caahew kernel• (throuah ch&DDela d .. cribed

above), proe .. a thea, and move thea into retail chaDDel• to conaumara.

The aaltiq ccmpanid are quite varied in aiae. Their capitaliaatieu

ranae from a low of about $25,000 up to many ailliou.

Market ch&DDal• from aaltera to retail conaumara take aeveral

different patha. Some aaltina firm Mrket caahewa and other aaltecl

nut• by dealina directly with retail food chai .. and food wholeaalina

oraaniaationa. Other aaltera aend their producta into food atorea via

wagon jobber•. It ill other aaltera .. rket throuah dru1 •tor .. , depart•

••t atorea, variety ah0p9, "di.mm atorea", ancl other type• of outleta.

l'inally, aeveral aaltera .. rket through apeci&l nut and/or c:andy ahopa.

Soma aaltina f il"llll make uae of aeveral of the varioua market ch&111Mla

c1 .. eribed, iDllteacl of c:onfinJ.Da themaelvea to only ona type of outlet.

Couumar aurveya iMicate that 1rocery atorea, delic:atdaena, and other

food ahopa are the moat widely patroni .. d retail outleta for aalted

nuta.

40

Price• of Caahewa at All Market Level• (3; 5; 7; 8; 9; 10; 12)

Price• of caahew nuta at all level• of the .. rket are indicated in

Table• 9 through 16, and aumaar ized in Table 17. Price• paid to Indian

and African caahew arovera by aaaembli111 aa•aci•• are not available.

Ieported price quotationa in India of domaatic and Afriean-arovn

raw nut• ranged fr• 4.5 to 12.2 centa per pound between 1952 and 1960

(Table 9). Buie price quotatiou in rupeu per 10111 ton are converted

to centa per pound at the official exchanae rat• of 21 cent• per rupn.

Table 9. rrice.Jl of law Caahew Nuta, Paid by rroeuaora, India, 1952-1960.

Year lb.

1952 860 8.1 SI 51 1953 666 6.2 "ii °ii 1954 478 4.5 533 s.o 1955 777 7 .3 51 ~l 1956 855 8.0 °ii 1.1 1957 747 i.O 779 7.3 1958 1,248 11. 7 1,301 12.2 1959 683 6.4 704 6.6 1960 843 7.9 j./ il

!I 'l'hue are price guotationa, not actual aalea pricu. lal•• price• fluctuate in the a•neral neiahborhood of th• quotatioaa.

21 Moatly fr. lfoumbique. 31 One rupee • 21 u. s. centa. 41 One 10111 ton • 2,240 lb. SI Price quotatiOll9 not available. iJ Price quotatioaa not available for year• before 1952.

lb.

Source: J.leport• of roreign Agricultural Service, u. 8. J>epartmant of ,Aariculture (9; 10).

41

Th••• quotation• for raw nut• are equivalent to a range of 14.5 to

39.2 cent• per pound of caahaw kemela, when raw nut buia ia converted

to kernel baaia at th• approximate yield rate. One pound of rav nut•

yield• .311 pouncla of kernel•, or raw nut price multiplied by 3.2154

equal• kemal bui• price (see Table 10).

Tabla 10. rric•• of l&v Caahaw ltuta (in-•h•ll) , laid by Proc•••or• in India, Coaverted to Kernel laaia, 1952-1960.YY.

African ltut•, c . I .r . Indian rorta Inclian-1rovn Ruta

: .., Nut Baaia : Xemel Baaia 1 law Nut laaia : Kera.el Bui.a Year centallb. centallb. centallb. cent•llb. I

1952 8.1 26.0 11 11 1953 6.2 19.9 1/ 1/ 1954 4.5 14.5 s.o 16.1 1955 7.3 23.5 3/ 3/ 1956 a.o 25.7 II II 1957 7 .o 22.5 7.J 23.S 1958 11. 7 37.6 12.2 39,2 1959 6.4 20.6 6.6 21.2 1960 7.9 25.4 11 11

l/ Conver•ioa made on baaia of typical kernel outturn from rav nut• ratio-:' One pound of raw nut• yield• approximately .311 pound of kernel•• Price convaraioa formula ia: law Rut Baaia Price x 3.2154 : Xernel Baai• rrice.

2/ Price quotation•, not act:ual aal .. pric••· l/ lriee quotationa not available. Source: Data ia Table 9.

The•• are price• quoted to Illdian caahew proc•••or• for raw nuta.

Such quotation• for Indian-grown nut• are macla by itinerant dealer•, who

aaaaable the aupply of nut• froa farMr•, to proceaaora' agenta and

vboleaale •rcbanta in the primary marketa. Th• quotatiou for African-

grown nuta are mad• to proc .. aora' aganta by illportiq firm located

mainly in Bombay, on a c.1.r. (coat, iaaurance, and fraiaht~ to Indian

port• baai•.

J

42

Price• of proceaaed caah.w kernel• have ranged from 32.6 to 45.9

cent• per pound, from 1952 throuah 1960 (Table 11). Th••• pricu are

on the baaia 1.0.1. (free on board) Cochia ad other Indian exporting

port•, and repreftat avaraae value• of all •hi,..nta during any aiven

ti.119 period, from Iadian proceaaor• to United ltate• illportera (•hip•

.. nta baaed on prior order• for future delivery at varioua time interyal•

and at varioua naaotiated pricea). Th• extr ... rasaae of th••• price•,

f ram 1931 (th• f irat year for which atati•tic• are available) throuah

1959, i• from a low of 12.8 cent• (in the depr•••ion year of 1933) to

a high of 6 7 .o centa (ia 1945, durina World War II) • All grad•• of

caahev keruele 6H averaged toa•th•r in the•• pric••· !he variation by

grad•• of price• on thi• baaia 4uri.Da early 1950 1• indicated in fable

15, aa a •ample of auch variation.

Table 11. Caahev Kamel Price• r.0.1. Cochin, India {and Other Indian lxporting Pointa); 1931·1960.

Year ceut•/lb. Year : centa/lb. Year centa/lb.

1931 20.0 1941 16.5 1951 39.6 1932 16.2 i 1942 22.0 1952 45.9 1933 12.8 1943 31.5 1953 42.2 1934 15.8 1944 57.6 1954 32.6 1935 16.4 1945 67.0 1955 35.2 1936 16.8 1946 55.4 1956 42. 7 1937 15.3 1947 39.6 1957 41.7 1938 13.5 1948 37.9 1958 38.1 1939 13. 7 1949 38.l 1959 38.9 1940 14.1 1950 32,2 1960 43.6

Source: Import atati•tica, U. s. Bureau of th• Cenaua (7; 8).

Price• quoted to Uuited Stat•• importer• by Indian proceaaora for

caahev kernela are indicated in rtaure 6 and Table 12. Th••• quotationa

43

are made on C.I.r. (coat, inaurance, and freight) baai• to Hew York (or

other United ltat•• port•) • Thi• i• the atalulard baaia for negotiatiou

between importer• and proc•••ora. Aetual price• at which deal• are cloaed

fluctuate in th• a•n•ral neighborhood of the•• quotation.a, bei.DI determined

by baraaining between the parti... Order• are placed, on thia baaia,

for foEWard delivery at varioua future tima interval•.

The average pric•• r.0.1. Indian exporting porta, referred to above,

are the reault of th••• negotiation.a, and information about th••• pric ..

ia taken from import atatiatica compiled by the United ltatea Bureau of

the C~ua froa illport invoic••·

Price quotatiou aiven in Table 12 are for the two moat important

araclea of caah•• brought into the United State•. "320-couut whole ker·

nela" account for from 30 to 35 pereent of the total United Stat•• caa•

hew aupply; Thia atat ... nt i• baaed upoa a Tariff COllllliaaion analyai•

of a•neral importa invoice• for early 1950, wherein the COllllliaaion

eatillated the perceutaa•• of caahew• falling into each of the varioua

grad .. (••• Table lS). It i• confirmed for validity over timll by aalted

nut trade aourcea (5). 'l'ancy (Large) Piece•", the ••cond moat ilaportant

grade, include• about lS percent of all caahewa imported, accordina to

the Tariff COllllliaai~• analyaia. Other important grade•, aucl their

percentage• of total -:.uhewa according to th• •- atudy, are aa follow•z

"240-count whole•" "450-count whole•" "Scorched Whole•"

Percent 7.5 7.0 8.0

According to the Tariff Cowaiaaion'• atudy, the more importaut caahew

grad•• liated in thi• paragraph accounted for a total of about 72 percent

44

of all caahew kernel• imported to the United State• during January, Karch,

and April of 1950. Thi• r•••arch, although coveriq only one •hort tiM

period• i• the only indication available of how caahew• break down into

the varioU9 arade•. There i• extra evidence, however, on the importaoc•

of "320-count vhol••". While the Tariff Coami••ion •aya that 34 percent

of the ca•hew• imported in early 1950 were "320'•", trade •ourcea •uaa••t

that thi• grade take• ill:. from 30 to 35 percent, over tiM. Ona trade

aource offera the opinion that, over time, caahew import. conai•t of

about 35 percent "320'•", 20 percent 450'•", 10 percent other whole ker-

nel arad••, and th• r .. t broken grade• (butt., 1plit1, &Del piec .. ).

Table 12. Caahew Eernel Price Quotatiozus by Indian Proc .. •ora to U. 8. Importar1, Selected Gradea.!/, C.I.r. laaia,

Bev York, 1947-1960.

320-Count 1&DA:y Piecea Average of Whole brnela of brnel• All Grade•

Year cenullb. cent.llb. cent1llb.

1947 43.0 28.0 2/ 1948 45.0 26.0 21 1949 42.0 20.0 II 1950 38.0 29.0 36.l 1951 47.0 31 .o 45.1 1952 34.0 38.0 48.9 1953 45.0 34.0 !/ 1954 37.0 25.0 38.6 1955 48.0 34.0 38.9 1956 50.0 44.0 46. 7 1957 !/ 2/ 48.0 1958 2/ 2/ 46.0 1959 21 2/ 47.S 1960 '!I II 54.8

l/ "320-Count Whol••" &Ad 'Taney (Lara•) fiecea" grade• account for about-30 to 35 percent and 15 percent, re1pectively, of the total caahev kernel aupply of the United Stat ...

2/ Not available. · iource: roreign Agricultural Service, u. s. Depart.ant of Agriculture

(9; 10).

45

It i• generally believed that nearly all the whole kernel• are •alted,

u well u many of the brokeu, with the remaining brokeu aoiq to the

candy and baking indU8tri••·

In Fiaur• 7 and Table ll, whole•al• price quotatiou for the more

important grade• of cuhew kerneb are indicated. Th••• quotatiou are

made by cashew importer• to nut •alting fi1'118 and other nut proce••or•,

on bui• r.0.1. (free on board) Rew York, at i.Jlporten' warehoU8e•,

with all import duti•• and •hippiq chara•• paid, and inclucliDg importer•'

maraiu. Such quotatiou often r ... in unehaqecl for •everal mntu at

a time, and do aot nec•••arily reflect •hort•tillle change• in the market.

Actual aal.. price• fluctuate in the a•neral neighborhood of the quota•

t:iou, however. Similar quotatiou are 11&4• P.O.I. other receiviaa

port•, but Nev York 1a the primary receiving port &Dd whol•••l• market

(aee Table 14). Therefore, quotatiou on Nev York b .. i• are believed

to be repr•••ntative of whole•ale price• charged throughout the c .. hev

trade by import.er• to •alter•. ror that portion of th• C&8hew •upply

which i• directly imported by •altera, th••• price quotatiou do not

directly apply. They do have an important •aniq, however, in that

they indicate (in an opportunity coat ••U•) the approaimat• value to

aalter• of directly illported kernel•, when landed at the primary receiv•

iq port with all chara••, aecruiq up to thia point, paid.

Wholeaale price• for aalted caahav• chara•d by •alter• to retail

outlet• and their whole•ale aupply aource• are not available.

aatail price• of •alted cashew• (and other •alted nutm) are not -

available in any coatiauoU8 aerie• of repr•••ntative atati•tica (over

ti.M and place) for the United State•. A8 a rouahtapproximation to the

d l I

46

I t---+--+---+---+~~~~~__._

I 1 I =1 I ~ S #I Iii •

I ,. ... I .. I ... ~ I I = a I

• 0\ -.,. ~

I I = I I ..

.•

' I ... • I

. ... i 1

r ii

.J l--1 0

Iii

i ·• llllit • ... • " :s I • . J

I I ,, • I

I j • • I tilt I

Table 13. Cashew r.tmel Prices, Selected Gradea,J/ Wholesale ~tat1ons br u. s. Import.en to Rut salters and other ProcesMH, f.O.a. Uew Yon, 1932-1960.

• standard • S\wlazd • ~iii 1P8ACJ Pieceaa 240-Countj/ • :e&COUliij/ • ~on.b9dS/ 1tlaol• hznelsaPiecu of Kemelsllltol• ltemelsa of Ennels able Kemels1lh>l• 1Camel111fhole Kamel•

Year1 c:enU/lb. I c•Wlb. I c.eats/lb. I cmta/y,. I C!!Jl!/lb. I ceaW'lb. • c•ts/lb.

1932 28.8 14.0 ~ ~ - - -1933 23.7 16.0 - - -1934 21.1 16.9 ~ ~ - - -1935 21.0 18.4 - - -1936 26.5 19.~ ~ !I - - -1937 23.7 19.2 - - -1931 24.2 14.9 ~ "11 - - -1939 23.l 14.7 15.4 - - -1940 22.0 17.6 ti 19.0 - - -1941 29.4 ~ Z>.7 - - -1942 ~.5 v 33.5 - - - ~ 1943 ~ ~ 99.6 12.0 100.4 98.1 - -.._]

1944 94.4 69.0 95.7 '11.0 96.0 1945 ~ ~ 96.3 60.0 98.4 - -1946 12.1 44.1 75.7 ~-3 -1947 ~ ~ ~9 37.4 64.0 46.S -l~ ~.9 32.4 62.l ~-9 -1949 j/_ ~ 54.9 zr.o 58.4 50.2 -1~ ti .C0.3 35.6 51.6 .ta.l -l~l ~ 54.8 41.8 '8.7 51.4 -19'2 ~ 63.2 41.8 67.l 60.2 -1953 ~ ~.3 41.8 51.s ~.4 -1954 ~ .w.3 33.0 47.9 .tQ.6 -1~ ti ~.9 38.7 ~ ... 49.6 -lCJM ~ 5'.6 ~.6 ~.9 54.4 -1~7 ~ '!J1. 7 43.1 - - -l~ ~ 52.0 33.3 - - -1~ ti ~1.9 36.3 - - -1960 g ~9.8 42.8 - - -

Table 13. (continued) Pootnot ..

!/ "320-COunt Whole•" arue (the moat c~ aracle) accouiiu for about 30 to 35 percent of th• total cuhaw kernel •upply of the URited Stat••. 'Taney Piacea 1" "240-Count Whole•," "450-<:ount Whole•," and "Scorched Wholu" araclu accounted for about 15 percent, 7.5 percent, 7 percent and 8 percent, raapectively, of total cubew aupply, in early 1950, accordina to the United State• Tariff COllmli••ion.

!/ "320-COunt Whole•" are the primary •inal• grade of cuhew kernel• umed in aalting. Rearly all whole keraela are •altad, u well u many broken kamala. All whole kernela (includi113 aeorched) account for about 69 percent of the cuhew aupply, accoriiq to th• U. s. Tariff Coaai••ion.

'1,/ Quotationa on the•• graclu not available prior to 1943, aad aot aecured for tbi• •tudy after 1956. Quotation on "Scorched Whole•" available only in 1944.

4/ Quotationa on thia grade not available after 1942. S/ Quotatiou on thi• arade not available after 1940. 6/ Quotatioaa on thi• grua not available before 1943. l/ Quotatioaa on thia grade not available before 1939. !I Batimate• of percentagea of C&8hew kernel• falliD& into each arade apecif ied in footnote•

6 and 7 are baaed on U. S. Tariff COllDi••ion analy••• of general imporU invoicu for J'A1Wary, March, and April, 1950. (lea Tabla 14). The utillate on "320-Count Whole•" i• confirmed over tU. by trade •ource•. Por moat graclea, a conaicierabla variability in percentage diatribution by gradu uua• from kernel aiza variation ruultiag from diff•l"8UC•• in arowina •aaaon weather from one •auOG to another.

Source: ".Jounaal of ~rca," llw York, lt.Y. (aa c._,uec1 in unpubliahecl tabulation.a by Agricultural llarkatina Service. u. I. Department of Aaricultura).

t

49

•

! I ... ' .:. ' ! • ' E \ • 1 I \ a \

/""' ,,.-" .... ! / ! ! /

/ / • <.. • • J "'" ...... ....

........

' I ' ' ' ! ' ' .,,,,,, j / /

/ I I I • = j :~· ..

• • ' J ' ' • ' I ~ · ' ' > / ' • 11"\

/ ... I j / -I ..-,.

J ! • . ~ A 0 ... • ..

J J

Table 14. cashew Kernel•• Unlt,4 States Total Imports, Irnport1 Tb1'oU9b New York CUstoma Dlatrict!I, Percentage of Total Imports

Entering lbrough New York, and Tarlf f Rate. 1931-1960.

I a Total a Import1

Year 1 (ICOQ lb.)

1931 1932 1933 1934 1935 1936 1937 1938 1939 1940 1941 1942 1943 1944 1945 1946 1947 1948 1949 1950 19~1 1952 1953 1954 19~5 1956 19~7 19!>8 19~9 196£

lC,~4 9,799

11,691 14,899 22,376 22,102 26,848 26,069 29,466 28,940 3~,o92 17,721

3,!>42 15,779 24,502 29,898 29,902 34,712 36,6!>0 48,482 00,504 42,071 47,709 ~1'"'~1 66,396 ~.279 58,396 66, 771 63,351 64.339

I I 1 Imports through t 1 New York 1 I (l(\l() lb1 ) I

8,596 8,C86 9,747

12,627 20,015 19,213 22.1~ 22,390 25,127 24,318 30,v~ 16,596 3,!I04

15,159 23,407 28,8C3 29,243 33,682 36,236 47,641 49,447 40,232 45,664 ~1,613 61,&>6 !>0,437 48,778 ~.654 53,m !>4·292

Percenta9e • of Total Import• 1

throu9h New Yorkl/ 1 ($) I

81.7 82.~ 83.4 84.7 89.4 86.9 82.6 e~.9 85.3 84.0 84.4 93.7 98.9 96.l 9~.~ 96.3 97.8 97.C 98.9 98.3 97.9 95.6 95.7 91.3 92.7 89.6 83.5 83.4 84.6 ff.4

Tariff Rate

(centallb. ).i/ 2.0 .. .. .. • " .. " • .. .. " .. .. " .. ..

2.o'V 1.5 .. • " .. • " .. .. " .. "

lJ' New York CustoM Diltrict includes the•• port•• New York, New York (headquarters port)1 Albany, New Yorke Newark, New Jeraey1 and Perth Amboy, New Jeney. !)eta bereln clearly indicate predominance of New York, as the main caahn import center (and wholesale market). Other caal\Mf receiving ports (cuttoma diltr1cts) include San Francisco, Masuchusetta, Ch1ca90, Los Angeln, PhUadelphla, Virginia, Maryland, Oregon, New Orleana, and several others of leaser importance.

#,/ Saale tariff rate on caahewa la 24 per pound, under the Tariff Act of 1930. It was applied without exception until July 9, 1948, when a reduction to l.5t per pound (made under provlalona of the General Agreement on Tariffs and Trade) wnt into effect.

Source1 u. s. Bure•u of Census import atatlstlc• (718).

51

general level of retail pric•• for •alted cuhew• in recent yean, how-

ever, the author ha• made •om randma ob••rvatiou in variou• chain

food •tore• and "dime •tor .. " in Maryland and Virginia. Tbeae obaerva-

tiona, coverina the period from early 19S6 to early 1961, are reported

in detail (by type and •i•• of package and by type of •tore) in Table 16.

They indicate that retail price• of aalted cuhewa (u well u other

aalt•d nut•) have remained relatively •table durina the period of the

•urvey. Baaed on th••• obaervatiOD8 1 it appear• that the overall

average retail price of caahew kernel• (equivalent per pound) for th•

period aurveyed hu fallen into the approximate rana• of $1.15 to $1.20.

Cuhew price• at varioua market level• are awmiari•ed in Table 17.

Table 15. Cuhew ~rnela: Proportionate Quantitiea and Unit Value of Import•, by Grade•, New York; Average of January, March, and April, 1950.

Grade

Whole (approximate maximua count per lb.):

210 240 280 320 400 450

Butta Splita l'ancy Piece• Small Piece• Scorched:

Whole• Butt• Split• Piece•

Undetermined or Unaelected!/ Total or Average

Percentage of total Qua!tity

1.9 4 •. , 1.9

20.4 3.4 4.2 2.7 3.2 9.1 0.8

4.8 0.2 0.4 2.2

40.1 100.0

Price per lb. l'.O.B. Cochin, IDclia

40.2 39.2 36.S 36.4 32.8 30.6 27.0 25.l 20.0 19.5

30.1 21.5 20.5 18.6

3CT

1/ It can be U8W19d that thi• group coui•t• largely of graded nut• In the •ama proportion u tboae •hovn.

Source: U. 8. Tariff COllllli••ion - invoice analy•e• of general import• (12) •

52

Table 16. Salted Cuhew Kernel•: lletail Price• in Selected Chain l'ood Store• and "Dime Store•," lutern United ltatea; 1956•1961 Average.

Type and Sise of racka1• :Price rr Packye :lguivalent Price per Pouud

In Chain l'oocl Store• Baa • 3 1/8 oa, Can .. 4 3/4 oa. lag • 5 1/2 oa .. Can • 5 1/2 oa, Can • 6 3/4 os. Bag • 7 oz, Baa • 9 oa. Can - 13 oz. Can • 14.oz.

- Prepackaged: 29o 390 49e 450

450 & 490 490 69o 89o

6~ "89o

fl.48 1.31 1.43 1.31

l.Ol & 1.16 1.12 1.23 1.10

.75 & 1.02

In Chain ''Dime Store•" - Salted on Prami•••, Held and Dia played in Bulk, and Sold in Baa or Box:

lq • 4 1/2 oa, Box - 8 os.

1.39 1.38

ApproxiJlate Ov!~all Averaae a.tail Price!/ per Pound, from 1956 to 1961 • fl.21.!t

l/ Simple average of pack•&• price• reported above. J.l Obaervatiou indicate that retail pricu of aalted cuhew• have

r ... ined relatively •table during the period of the obaervatiou. Source: aandoa obaervationa in varioua •tor•• in Maryland and

Virainia, by th• aut1"tr. from lpriqil956 to Winter 1961.

Price• at the vholeaale (from importer to •altar) level are di•·

cuaaed further in the cl_.nd analy•i• (for cu1lewa and peanuta) aaction

to thia •tudy. lecauae of the very aketchf price information available

o~ •altad caahew• ana aalted peanut• at the retail level, it i• nee-

ea•ary to make demand .... uremanta buad on New York wholeaale p1icea,

a~t which re .. onably accurate and repreaentativ• inforRMltion i•

available. (I•• Fiaur•• 8 and 9 for an indication of the relationahip

betven cuhew conaumption and Bew York vholuale pricu.)

Table 17. Cashew Price Ranges at Various Market Levels - Summary Table

I I I Time Period _1_ -~Mai-ltt _ _l.Hel_ 1 J>rice Ranae 1 1960 Averaae Price rPrlces- Palc[to GiOwm-ror Raw_1iu_t_s_ hy_Asse_mbly_Aaencies-Not Av_ai lab le)

I I 1 1 4.5 to 12.2 cents/lb. 1 1 (Raw Nut Basis)

1952-1960 1 Raw Nuts Being Sold a 14.5 to 39.2 cents/lb. 7.9 cents/lb. (Raw) (Raw Nµt and ICern•l Bases) a to Indian Processors 1 (Kernel B;sis) 25.4:cents/lb, (Kernel)

1952-1960 a Processed Kernels a (Kernel Basis) 1 (Basis F.O.B. Indian 1

1952-1960 (Kernel Basis)

1952-1960 (Kernel Basis)

1 Exporting Ports) - 1 1 Average Prices be- 1 1 tween Indian Process- a 1 ors and U.S. Imoortersa_2-2.6 to 45.9 cents/lb. 43.6 cents/lb. • Average of All Grades 1 a a of Processed Kernels 1 1 I (Basis c.I.F. New I I 1 York) - Quotations of a a 1 Indian Processors to a a a U.S. Importers, and a 1 1 Basis of Negotiations 1 1 1 Bet~een Them~ 1 38.6 to 54.8 cents/lll. a 54-.a _c_entJ;flb. 1 •320-Count Wholes" - a 1 1 Wholesale Quotations 1 1 1 by U.S. Importers to a a 1 Nut Salters, F.O.B. a 1 a_New _y"ork_ - - •- ~.3 to 63.2.~ent_s/lt>_ .. I o9.8__~enWl.b ...

t'NhOl_e_safe-Prlces from ·saitel'i to RetaI1 e>Ut1its.::}iot~obtained > 1956-1961

(Kernel Basis) 1 Retail Prices of 1 1 1 Salted Cashews, 1 1 1___Ea.s.t.em._ll.S_L _ _ 1_ 1.5i_ tg Sl.48ilb._ _ 1. Sl .2lilb_.

Sources Data of Tables 9 through 16.

VI w

t-\ / l_

I I

! ' I! _J i _,,,,,,,,,,,,,, ,.,..---------._ ----............... ~~

7

.uo I

·~ I

,.._,,,,., ___.__

•"1VY _.__

.250 ...L

-1 :150 .. 100 ....L..

•

ft.pre •• *Price of

rce:

t.GD la ..... lrtce ta Ceat• per u.. - 1.00

f' I , ..... "\ I \ -- • I \ / \\ Price -.- '" I ..--I \ A -L .70 I \ I \ I" '--"" .J,.. .60 I \ \ I \...--, ,,,. ,,,,. ,,,,.,

\ I/ '--1 .+ .so

j

I I

_rx -'-----/

1 l

1U Quutf.ty real•, 1"<320-cou.t ... 18.

/

\

l

'v VI VI

.40

.30

Co• llll'~loa or Salbd Ca ..... ...J.. .20

.1

0 1"2 l

UM a.ta, _. frke• of C.alMnt S.rmls. Uel.tM Sta~•• 1932-1960. 1-U, r .o. •. •• Tor~ ( 11Sta.Marcl Vlaol••" Cr..t. Mfore 1943).

S6

U••&• of Ca•hew Xaniel• in the United ltatea -Po11119 and Quantiti•• Con.umacl (12)

Of all c .. hew• iJl!ported into the United ltat•• (the enttre aupply

available, and the only •a•ure of apparent couuaption. •inc• there ia

no domeatic production), an averaa• of about 90 percentgx:s to the aalted

nut trade each year(••• Table 18). "Salted nuta" are defiud .. •helled

nut kernel8 which have been "ro .. ted in hot veaetable oil with aalt

added". Of the r ... inina 10 percent, about 6 percent are uaed iD candy

and about 4 percent in baked aoocl•, OD the oeraae.

Of the caahew• aalted, about half are aold iD mixture• with other

aalted nut• (includiag domeatic tree nut•, imported tree nut•, and pea•

nut•). The r ... iacler are aold .. aalted caahew• alone. Cahew• conatttute

about 75 perceat of all tree uuta uaed iD the aaltina trade. They

uaually ••11 at lover pricu than other tree nuta, but at hiaher price•

than peanut•.

liaurea •hovina quantiti•• of cahew• imported to the United Stat••

muat alao repreaent the apparent total couumption of the•• nuta. Thi•

i• becauae there ia no doMatic production, and no •tati•tica are

collected to •how retail aalea, •tocka on band. aud carryover from one

•• .. on to the next (to aid in makiq a cloaer ••till&te of couumption).

figure• repr••entina quantitie• of c .. hew• aalted in the United

State• are baed upon ••tillated percent•&•• of the total illporta, believed

to be uaed by the nut •altina induatry. Percent&&•• uaed in obtainina

annual ••ti.mate• of ealted c .. hew• are baed OD percentaae• periodically

determiud in •urvey• of the nut induatry by the United Stat•• Tariff

C~•ion. The C-U.H ion ha made •urvey• and determined percent~&••

57

for periocla u follow•: 1935 to 193 7, 85 percent of all cuhev•

••timated to be •alted; 1946 to 1949 (averaa• of year• beginnina

October 1), 91.667 percent; 1950 to 1952 (averaa• of year• beginning

October 1),89.583 percent. M of June 1960, no further information of

thi• type had been collected on cuhev• by the Tariff C0111iaaion (to

cover periocla •inc• September 1953), However, the C0111iaaion'• ataff

informed the author in June 1960 that it believe• the averaa• percent•&•

of cuhew• beina aalted baa uncleraone little chana• aince 1953. Baaed

upon percentaa•• fOUDd in the eurveye, the follovina percentagu have

been uaed in thi• atudy to ••ti.mate th• number of caahew• beina aalted,

by year•: 1932 to 1941, 85 percent; 1942 to 1946, 90.625 percent9

1947 to 1950, 91,66'/ percent, 1951 to 1953, 89.583 percent; and 1954 to

1960, 90.625 percent.

Fiauree •having quantiti•• of cuhew• ••ti.mated to be •alted llll8t

al•o repreaent the apparent conaumption of •alted cuhew• in the United

Stat... Ho •tati•tic• are available for retail •alu, •tock.a on hancl,

and carryover, to aid in makina a cloaer eatimate of conaumption.

Quantiti•• of cuhew• imported to the United State• (apparent total

cuhew conaumption figure•) are given in Table 18 and Fiaurea 8 and 9.

latimated quantitiea of cuhewa uaed by the ealted nut induatry (apparent

couumption of aalted caahewa) are alao •hown. Both aeriea of data are

aiven on total and per capita bu••·

Until th• early 1920'• cuhew kernel• were of little coaaarcial

illportance in the United Statea and around the world. They weiecon-

aumacl pr1-rily in areu where they arew. Coamarcial development on

aa •~ive acale beaan in the early \920'• after a moc:leru packing

58

•thod wu developed. Thi• •thocl (d .. cribed in detail previoualy.

along with other •tepa in ca8lwv proceaaing) provided a aolution to the

aertoua problem of imect cl-ae to kernel•. The introduction of •••l•d

till cau (with air evacuated an.t replaced by carbon di•ide gu) areatly

eued thi• problem. After thi• imaovatioa, the cui.v tracle arav rapidly.

with a product hiahly cleairable to conaumera.

lt&tiatic• preaented earlier indicate that the .. in developmaat of

cuhew growina hu taken place in India and ia Kut Africa. with uearly

all proc .. aina of the crop• from both ar ... takiq place in !Delia. Minor

comaarcial e&8hev production b.aa developed ia other areu.

ConaU11ptioa of cuhev karnela bu hacl it• .. Jor developmeat in the

Uaited St&tea, which take• about three-fourth8 of the world'• aupply

(according to available fiaurea). Conauaption in the re•t of the world

hu arovn at a futer rat•• althouah on a ... uer acale, than conaU11ption

ia the thaited ltatea. Growth in thi• country i• ahown in Table 11. Thia

arowth wu rapid and •t•ady fraa the early 1920 1• until World War II.

It uaU11111d lara• enouah importance to become the aubject of aeparately

publiahed •t&tiatica in the early 1930'• 1 reachiq a prewar peak of

35.6 million pouacl8 in 1941.

American cuhew conaumption •uffered a ••vere, but temporary, ••t-

back clurina World War II. Thi• aroae froa the ahortage of •hippiq apace

for non-•trateaic .. teriala duriq th• war. Thi• •hortaa•. accompanied

by a Federal Govel'DMnt order which reatricted cuhew iaporta (except

u linked with ahipmenta of •trategic cuhew-•h•ll oil) f ir•t c ... into

beina in late 1941. Aa a re•ult, import. (and re•ulting conaumption)

for 1942 were le•• thaa half of what they hacl been in 1941. In 1943,

59

Table 18. Cashew Kernels• Quantities Used in the United Statess Total and Per Capita Imports (Apparent Total Consumption)1 Total and Per

Capita Estimates of Quantities Salted (Apparent Salted Cashew Consumption). 1932-1960

Total 1 Per Capita I Total a Per Capita Imports and 1 Imports and • Salted Salted

1 Consumption 1 Consumption Cashews Cashews Y,ar I (looo lb, l ' (lb.) I (looo lb. l I (lb.)

1932 8,623 0.069 7,330 0,059 1933 12,526 0.100 10,647 0.085 1934 14,899 0.118 12,664 0.100 1935 22,376 0,176 19,020 0.149 1936 22,102 0.172 18,787 0.147 1937 26,848 0,177 19,421 0.151 1938 26,069 0.170 18,759 0.144 1939 29,466 0.225 25,046 0.191 1940 28,940 0,219 24,599 0,186 1941 35,592 0,267 30,253 0.221 1942 17,721 0.131 16,244 0.120 1943 3,542 0.026 3,247 0.024 1944 15,779 0.114 14,467 0.105 1945 24,502 0.175 22,460 0.161 1946 29,898 0.211 27,407 0.194 1947 29,902 0.208 27,410 0.190 1948 34,712 0.237 31,819 0.217 1949 36,650 0,246 33,596 0.225 1950 48,482 0.320 44,442 0.293 1951 50,504 0.327 45,243 0.293 1952 42,071 0.268 37,688 0,240 1953 47,709 0.299 42,739 0.268 1954 56,551 0.348 50,660 0.312 1955 66,396 0.402 59,480 0,360 1956 56,279 0.335 50,416 0,300 1957 58,396 0,341 52,313 0.306 1958 66,771 0.384 59,815 0.344 1959 63,351 0.358 56,7!52 0,320 1260 64,332 Q135§ 5813Q7 01 3~3

Source a For imports (and total consumption data - u. s. Bureau of the Census import statistics1 for salted quantities - calculations by the author based on estimated percentages salted (as periodically determined by U. s. Tariff Commission surveys of the nut salting industry). Per capita data are calculations based on u. s. Census Bureau population estimates.

60

they hit an all-time low (aiace aeparate caallew atatiatica were firat

kept) of about l.5 aillion pounda. The aituation beaan to eaae in 1944.

By the middle of that year, caahev-•h•ll oil had c ... ecl to be ..claaaifie4

aa a •trategic commodity, and the ahippiaa apace aituation had eaaed

conaiclerably. Ia 1945, all caahew import reatrictiou were lifted.

Th• var-cauaed inability of th• United ltat .. to import caahav•

depre•••cl the Indiaa ancl African caahw incluatry. lhippina artace •h~r't•

aa•• and reatrictiona, coupled with limited doma•tic conauaption, cauaed

a lara• porti011 of India'• 1942 and 1943 crop• to r ... in uuold. Thi•

led, in April 1943, to an Inclian ban 011 i11pe>rta of r• caahw nut• from

Africa, ao that maxillm amounta of Inclian nut• could be aold. I.a a

r .. ult, 110 appreciable c~rcial caahew harv••t took place in laat

Africa while the ban vu in effect, •inc• the African growera depend

on India for proc•••ina ancl further .arketina of cuhwa. The Inclian

ban vaa lifted in middle 1945, and both Indian aDCI African ••-nta of

the iDduatry beau to return to normal.

United State• cuhev 11-P°rta (ancl conauaption) returned to fairly I

normal quantiti•• ia 1946 ,.; the f irat full year free of import reatric•

tiODa~ Price• di4 not fully drop from their artificially hiah wartime

ltn·•l to a 1M>re normal raaa• until 1947, however, (I•• Table 13).

Quantiti•• imported (and conaUMcl) did not aurpaa• the prewar peak of

35.6 million poun4• (eatabliahecl in 1941), until 1949. They 1rw1

rapidly but •~at erratically, until 1955, when the comparatively

hua• record of 66.4 million poun4a waa aatabliahed. line• 1955, caahw

importa (ad couumption) have ahown a fairly atable trend, with no ·---~·4

... ,

61

clear tendency toward a lODg•r-run, ri•• or fall. Th• all•tilla record

level of 66.8 llillion pouncla vaa achieved in 19.58 (•••Figure 4).

Per capita illport• (and couumption) of caahw kernele in tba United

Stat.. (aee ftauree 8 and 9) grew eteadily ill each pr•ar year (except

1936, 1938, &Del 1940, when only •liaht relapa•• were auffered). Year•

of lara••t growth were 193S, 1939, and 1941. The prewar record of

0.267 pOUIMla of kerul• per peraon wu ••t in 1941. World War II cauaecl

a ••tback, aa iuclicatecl previoualy. lubatantial quantity recovery

c- in 1946, but th• prwar record vaa not brokell until 19SO, when th•

f 1.gure reached 0.320 pounda per capita. After relape .. ill 1952 and

1953, an all-ti.Ila record of 0.402 pounda per capita vu imported (and

cona~cl) iu 1955. Per capita quantiti•• have run aomawhat under thia

record in the year• •inc• it waa ••t, but they are boldiD& up well.

lleaearch and Future Proapecte in the Caahw IDduatry (1; 2, ••ctiona 3 and 4; 4, pp. 34-38; 6)

laaearch aiaed at improving the caahw 1Rcluatry in India vu beaun

ia 1931, follov1111 the be&ilmina of rapid c~rcial growth (which vu ••t off by develo,..nt of the illprovecl .. thod for export paokilla of

caabaw kernel•, aa previoualy deacribed). Such reaearch hU been

a•uerally cOllducted on a liaited baai•, due to lack of adequate filaauial

aupport.

A new emphaa ia baa com in recent yeara, however, f ollowina the

utabliehlmat of laclia'• inclepenclenc• in 1947 and the adoption of bar

preeent coaatitut1on in 1949 and 1950. Th• vehicle• for guicliq economic

progr••• are the "Five Year Plana", adopted in 1951, 1956, ancl 1961, ancl

62

covering th• period• 1951-1956, 1956-1961, and 1961-1966, reapectively.

Each Plan bad placed conaiderabl• emphaai• on arowth and develo,..nt of

th• Indian caahew induatry, aa a prominent factor in India'• export

trade and her capacity to earn foreign dollar excbaaa• (which i• a

critical factor in her foreign true).· for example, the preliaiDAry

draft of the Third five Year Plan (June 1960) call• for a caahev produc-

tion target of 336 aillion pound• by 1965-1966. Thia goal, if achieved,

will repreaent a 133 percent inc::re .. • over India'• 1960 caahew procluetion

of 144 aillioa pounda (fiaur•• are in••hell baaia) ·•

Caahev reaaarch in India baf ora World War II covered th• f ollowina

topica1 (1) Impr~nt of the caahew tr•• (viaor, breading, ••l•ctioa,

and beaning capacity); (2) morpholoaical •tudie• (of variatioJW in

botanical for11111 of different part• of the tr•• to provide better adapt•

ability to different •oil and cli .. t• conclitiona); (3) illprov .... nt in

•i•• and quality of the caabew nut; ancl (4) work on the few peata and

di••aa•• to which the caabew i• aubject (primarily caterpillar•, "cli•·

back" diaeaaa, and "bleeclina" diaaaae). Thi• prewar raaaarch, however,

vaa conducted on a very liaited acale, due to lack of adequate f inanc::ial

aupport, ancl it .. rely acratched the aurface ia c0111pariaon to the reaearch

work aeeded to develop a truly efficient c01111arcial caahew induatry.

&aaearch •ince the adoption of India'• firat Pive Year Plan in 1951

baa been coverina (or plaantna the future coveraae of) the f ollowina topic•

concerning the production of raw caabew nuta: (1) aurvey of uiatina

caahev plantationa in louth India, cluaif ication and deacription of

different type• of caahew operationa; (2) ••l•ction of pro.iaiDg caahev

varietiea, both Indian and foreiana (3) ataadardiaation of propagation

63

.. thoda; (4) atudy of factor• influencina flowering, fruit ••ttina, and

bearing; and (5) atudy of effecta of aoil type, aoil moiature, and plant

nutri•nta on flowering and fruit aettina. Mor• emphaaia than in prior

year• i• being placed on caahew reaearch ainc• India'• indepenclenee and

embarkation on economic planning.

In addition to the reaearch efforta deacrit.ed, India'• government

and member• of th• caahew incluatry are alao workuaa in effort• to develop

new and laraer marketa, improve proc•••ina efficiency, improve workina

conditiona for laborer•, eatabli.ah more equitable and efficient priciaa

and marketina of domeatic and African raw nuta, and mak.e the Indian

proceaaing incluatry l••• dependent on the laat African raw nut crop

(by arowina more domeatic nuta).

"The Caahew and Pepper Export Promotion Council" waa ••t up in 1955

under joint .auapic•• of aovenmaat and incluatry, with headquarter• at

Cochin, to ealarae exi•tia& export market•, open up nw onea, and ••ttle

complaint• ariaing in the trade.

Indian experta believe that programa to adverti•• the food value of

the caahew kernel will help to increaae demand for the product in both

export and d01Matic markela. They alao think that further efforta to

atandardi•• and improve quality of caahew kernala ahould be made in order

to encourage additional trade and conaumr acceptance. Some kernala are

atill proceaaed, packed, and marketed in way• which fall abort of the

beat accepted technoloay, leading to an inferior product which doe•

unfair damage to the caahew induatry u a whole.

The induatry ia being uraed toward greater adoption of the oil bath

proeeaaina •thod, which give• greater yielda and higher qudity of

64

kernel•, and provide• for greater recovery of cuhev •hall oil (u a

valuable byproduct), than other proc .. •ina mthocl• clo. Initial iuve•t•

•nt in the equipmant required, however. i• q11ite expauive compared to

financial raaourc•• of moat of the •mall ca•hev proc•••ina plant owner•.

To overcome thi• obatacle, the •mall proc .. •or• are being ur1ed to com-

bine th ... •lv•• into uaociaticma to ••cure aovernmant loan.a of the

neca••ary capital. In addition, the Indian ''Council of Scieatific mad

Induatrtal lleaearch" haa been uraed by the ''Council of Agricultural

lle•earch" to inveatigate poaaibiliti•• for develop1Dg cheaper, efficieat

proc•••ina .. thoda.

Litte information i• available raaarding raaaarch and future

proapecta in the Saat African cuhev incluatry. Thi• induatry, con-

centrated in Portuaua•• Mosambique and Briti•h Tanaanyika, Zansibar,

and Kenya, i• predominantly a raw uut producer. Ho extenaive developmnt

of proc .. aing haa been made in thi• area, becauae of lack of a large

•upply of cheap band labor, •uch u exiata in India. (lhelling cuhev

nut• haa ao far reai•ted Mchauization, due to the kidney ahape of the

nut• and poi•on ef fecta of the •hell oil. Thua, a lar1• aupply of cheap

hand labor 1•, for the pr .. ent, a uec•••ary bui• for th• cuhw proc•••-

ing buainaH .) ror thi• rauou, But Africa haa developed a laraa acale

of production of raw nut• to •upply the .... Dd ari•ina frca the Indian

proc•••ing incluatry and export traAle (in axe••• of India'• domeatic raw

nut •upply) • Only a fw cuhw kernel• are proce•••d and .,ved toward

ccmaumera from But Africa, or other producing areu be•ide• India. The

Portuauaae aovenlllellt haa been reportedly tryina to develop a caahMr pro-

ca•• ina induatry in Mo&•biflu•.

65

Sumari&ing future proapecta for the cubew incluatry, it ia moat

likely that ita expanaionary trencl will continue indefinitely into a

briaht future. Demand for cuhew kernel• bu been growing in the

United Statea. Aa other countrie• of the world meke progr•H in economic

arowth, and aatiafy their more buic needa and deairea, they may 1te

expected to preaent an ever-arowiq d-nd for cuhw kenael•. Such

growth in demand will probably be met alvaya by an ample aupply, u

lndi•, laat Africa, Brasil, and other producer• develop their cuhev

induatri•• to greater •1M and efficiency. Thi• develo.-nt may alao

be expected to procluce the byproduct• - caahew nut •hell oil and cu-

hew apple• - in an ever-increaaing aupply for ever-increaaing uaea.

66

DISCllIPTIOH or NUT SUPPLIES, COllSUM!TIOH AND PRICES IN THI UNITED STATBa!/

General

Thia atudy attempt• to explore the market relationahipa between

caahew• and peauuta in the United ltatu, eapecially in their uae aa

aalted nuta. The caahew nut iuduatry of the world, and the trade in,

and uae of, caahew• ia the United Statea, have been deacribed in aoma

detail. Comparable deacriptiou of the peanut industry may be found iu

other reaeareh reporta (13; 14; 15; 25; 31; 35; 36). It •hould be

helpful, however, to point out aoma of the more aignificant facts en-

earning procluctiou, couumption, and price• of peanuta in the United

ltatu. Thia information, alona with that already preaeated on caahwa,

eatabli•he• a foundation for the following analy•i• of demand for both

peanuta and eaahewa. Deacriptive information about productin and con-

•umption of other nut• i• preaented alao, in order to place peanut•

and caabew• in proper perapective iu relation to other nuta aud the

total nut price, production aud coneumption picture in the United Statea.

2/ Thia aection i• an overall aU1111&ry of information available on United State• patterna of production, importa, exporta, conaumption (by forma in which purchaaed by conaumara), and pricea, of peanuta, caahewa, and other important tree uuta. Citationa to aouree literature c&1m0t be made for each aentence or paragraph, bacauae of th• proceaa of •yn-th••i•ina and interpretina material from aeveral aourcea which the author baa followed throughout thia aection of the etudy. A general credit citatiou to th• literature i• made for each aubaection of thia aection. Reference• uaed in obtaining thia information are liated in the Biblioaraphy - Literature Cited aection of thia atudy, under the aub-heading "Deacription of Nut Suppliea, Conaumption, and Price• in the United State•"· Source• of atatiatica are credited in footnotes to table•.

67

Production, Import•, and lxporta (13, pp. 38-47; 14; 16; 17; 18; 19; 35; 36)

Several cliatinct type• of pe&RUta are produced in the United ltat••·

laeh ha• certain particular phyaical characteriatic• aacl a iiatinct pattern

of couumer uaage in various forma. Th• primary type• are Virginiu,

Bpaniah, and lwmara. Some l••• important type• are alao recopiaecl1

Val•neiu, Tennaa••• a.cl, and Tenne•••• Whit•.

Thr•• peanut production areu are recognised. The Virainia-C.rolina

area, which include• peanut areu of Virainia, North Carolina, and Tenn-

•••••• produce moatly the Virginia type, alona with amall amount• of Tenn-

••••• lad and Tamie•••• White. Th• loutheutern Area producu lpaniah

and llumaar type•, and include• peanut areu of Georgia, Alabama, rlorida,

South Carolina, and MiaaiHippi. Th• louthweatern area produce• lpaniah

type peanut• in Tua.a, Oklahoma, and Arkanau, and Valenciu in ••· Mexico.

~·"Tree nu ta produced in the Uni tad ltataa are pecau, walnuta, almonda,

and f ilberta (haaalnuta) • hcau are grown c.,_rcially (in order of

importance of ltat••) in Qaergia, Texaa, Oklahoma, Alabamlr; Louisiana, ..

lUaaiaaippi, Arkanau, rlorida, South Carolina, New Mexico, aacl lfurth

Carolina. Two typu of walnuts are arown. lqliah (or Peraian) walnuta

are grown :l.n Califonia and Oregon. A few black walnut• are anwn. moatly

in th• lut, but no atatiatica are available on their production. Almonda

are grown in Califonia, while Oregon ancl Waahington produce filberts in

conaarcial volWlll.

The atat•• liated u producer• of peanut• and tree nut• ar~ t.ho••

of c011111ercial importance. Kin.or quantiti•• of the varioua nut• are pro•

duced in certain other atatea, but the total of auch production ia believed

to be negligible.

68

Th• United States carries OD a small amount of import and export

tracle in peanuts, almonds, filberts, walnuts, and pecans. Moat of the

prodtietioa of th••• nut• i• conaumad doma•tically, with only a little

auamentation by imported •uppli••·

Large quantities of caahev•, brazil•, ch••tnuta, pignolio•, and

pistachios (none of which i• produced in the United State• in c01111ereial

voium, if at all) are imported. Cuhev• are of primary importance a.ma the imported tree nuts. Durina recent yean t1-y have been imported in

laraer amount• than the combined total of brazil•, cheatswt•, pignolioa,

and pi•tachio•.

The primary source countries for United State• nut import• during

recent year• have been: for peanuts• Mexico; almouda, Spain; Brasil nut•,

Brasil• filbert•, Turkey; cheatnuta, Italy; pi•tachioa, Iran, Turkey,

and Afahaniatan; walnuts, Iran and India; and for cuheva, India.

Aa indicated in Pigure 10 • peanuts from all procluctiou areaa accounted

for nearly 80 percent of the United Stat .. • total productioa of all nuts

from 1955 through 1958. The doa.atically arown tree IWts (almonda, fil-

berts, pecans, and walnuts) accounted for the remaining 20 percent. Pea-

nut• grown in the Virainia-Caroliaa area accounted for 25.6 percent of

our total nut production. Southeutern area peanut• amounted to 40 per-

cent of all nut procluctioa. 8outhweatern area peanuts accounted for 14.3

percent of the total United Stat•• productioa of nuts. Pacana, walnut•,

almond•, and filbert• accounted for 7.9, 7.6, 3~8, and 0.8 percent,

reapectively, of all United Stat•• nut production.

69

, ... . ....... (Sorta.t .... t•l'llAJ'*a) • . 40,,11 (VUaiQ •1'· C.l'Ol:lu

Al'M) •

11 a..atf.c ·-•• lul• .. 20 .. 11

P•ml• (SCNtllwabh ..... , ..

14.31

lS.61

fl.au• Uh ••••••ad IA•._., ta4uecto.* tip lttlt4•, •• f•n•oC•P• of t•t•l ltut lnductton, Uaf.tefl seat••• Av••ae of Y•i-• 19S5•1tS& ..

~, •• •took,.., ... , •lib* fO't ,. ..... , ...... u ...... IH tt•• •t•. Soutcet teb1• 1'·

70

Table 19. Peanuts and Tree Nuts1 Production, Imports, Exports, Supply, Disposition, and Total Domestic Consumption, United States,

Average of Years, 1955-1958.

Item Peanuts•

Production (Farmers' Stock Basis}a Total Virginia-Carolina Section Southeastern Section Southwestern Section

Imports (Farmers' Stock Basis} Stocks at Beginning of Years

Shelled Peanuts (All Grades) Cleaned (Roasting Stock) Peanuts (In-Shell}

Exports (Farmers'' Stock Basis) Domestic Consumption (Disappearance)•

Edible Consumption of Shelled Peanuts Edible Consumption of Cleaned Peanuts Crushings of Shelled Peanµts for 011

All Tree Nuts 1 Production (In-Shell Basis) Imports (In-Shell Basis} Total Supply (In-Shell Basis) Exports (In-Shell Basis)

I Quantity (Thous. lbs,}

1,606,891 515,106 804,019 286,379

19,163

180,250 19,500 56,870

658,250 65,750

193.500

400,403 385,776 786,179

Domestic Consumption (Disappearance) (In-Shell Basis) Loss in Shelling Process (Weight of Shells)

29,780 756,399 494,551 261.848 Pomestic Cgnsumption (Shilled Basis)

Cashews a Imports (Shelled Basis) A nt t c C d Basis

Pecans In-Shell Basis a Production Imports Exports

Walnuts (In-Shell Basis)a Production Imports Exoorts

Almonds a Production (In-Shell Basis) Imports (In-Shell Basis)

si In-Shell Basis) a

61,961

159,165 1,325 2.330

152,250 13,780 5.916

77,100 14,484

15,375 13,320

(Usually small} Sourcesa "Fats and Oils Situation" (peanut data)1 "Fruit Situation"

(tree nut data). These are recurring periodic reports of Agricultural Marketing Service, U. S, Department of Agriculture. "Marketing Tree Nuts - Trends and Prospects," Marketing Research Report No. 139, Agricultural Marketing Service, u. s. Department of Agriculture. "Agricultural Statistics - 1959", U. S. Department of Agriculture.

71

Table 19 •how• 1955-1958 average• for peanuta and trH aut• in the

United Statea, aa to quantitie• produced, imported, exported, carried

over in atock from ona year to the next, and couumed. Thea• figure•

indicate the aupply and dia,..iti .. jlieture for peaauta, all tr•• auta

combined, and the follovina trae nut• ••parately: caahewa, pecau,

valnuta, almond.a; and filberta. ()tote: averaa• import figures oa ,...

nu ta, peeana, valnuta, almoncla; ancl filberta •heuld be conaidered ia

light of the fact that auch quantiti•• vary widely from year to year4

lut Conaumption ratterna (13, pp. 1-13, 43-44; 16;-·17; 18; 19; 20; 22; 23; 24)

Th• relative importance in per capita conaumption in th• UDited

State• of peanuts, caahewa, almond•, fil'berta, pecana, walnuta, ancl

m.acellaueoua tr•• nuts in all forms ia ahown in Fi&ure 11 and Table 20.

lxpr••••d aa percent&&•• of per capita conaumption of all nut• dUl'ID&

the period 1955 to 1959, peanut• conaumed amounted to 72.9 percent, caa-

haw• - 6 .3 percent, almonda - 4.3 percent, filberta - l.2 percent, and

other tree nut• - 3.3 percent. (The•• data are all on •helled baaia.)

Table 20 •how• actual per capita consumption f igur•• in pounda for the

period 1938 to 1959. Th• pnd•tw•nt-place of peanuta, and aecond place

held by caahew• in the nut consumption picture, are clearly indicated.

Comumption of peanuta and the more important tree nuta, conaidered

according to the varioua f orma in which conaumer• buy them, i• •hown in

Tabl•H 21 and 22. Peanut f igurali -~~ given for the period from October 1,

1950 to July 31, 1959. They •how little percentage change over tU. in

the breakdown of edible peanuta into the varioua final for11111 •old to

72

couumare. The moat recent figure• available on tree nut brealcclowu ae

to final foru are thoae •hown for th• period October 1, 1950, to

September 30, 1953. The•• •tatietic•, ae collected, refer directly to

••tillated •ale• of each nut through varioua outlet• (typea of proc•••ina

for final couumer producu). They tbu9 infer the form and quantiti••

of each nut purchaed by couumere. Shelled edible peanuu of all type•

were coaeumd, in the variOU9 final form by percentqu, ae ducribed

below.

Of all peaauu couumad aa •alted nut• during the 1950·1958 period,

71. 7 percent were Yiqinia type, 25 .4 percent were Spaalall, &Dd 2. 9 per-

cent were ammen . Of all peanuu couumd in candy, 30 .8 percent were

Viqiniae, 54.0 percent were lpani•h, ancl 15.2 percent were ~r•.

reanuu couumad in peanut butter were 17.l percent Virainiu, 32.S per•

cent Spanuh, and 50 .4 percent lbmner•.

Prom the foreaoiaa •tati8tic•, it 18 apparent that Virainia type

peanuu are the .,.t popular type for ealting, and that more of tlMla are

coaeumetl ae •alted nuu than ill any other form. Spani•h type peanuu

are more popular in candy than other typ .. , but candy uee doe• not require

ae uny of them ae doe• uee ill peanut butter. ll\llUl8r peanuu f intl their

areate•t popularity and uee in peanut butter.

Caeh., nut•, the entire United State• •upply of which i• imported

in th• •helled form, are moatly conaumd aa ealted nut•. Duriaa the

period October 1, 1950, to leptember 30, 1953 (late•t •tati8tic• avail-

able), an average of 89.6 percent of all our caehev• were conaumd u

eal ted nut•. The r-incler were uaed in candy and baked aooda • I.a

, ft 11.

""' .... ..,.. 20

i...-1-n.

.. ,1.. • -1.2n

ti .. 6.0ft

t:•.,.•U.oo o 11»1• •MJNt• ..s it'-1 l'ne ca · aplta u ... of. U t•• 1Cd ht•••

( ~ ll!tlled laeb.)

Table 20. Edible Peanuts and Tree Nuts1 Per Capita Consumption in the United States, 1938-19591/ (Shelled Basis Except as Specified)

a In-Shell a(Cleaned)aShelleda All I I I I I I Other I All I All a Peanuts 1Peanuts1Peanut~1Cashews1Almonds1Filberts1Pecans1Walnuts1Tree Nu aTree Nuts1 Nuts

YearY 1 lbs. a lbs. 1 lbs. 1 lbs. 1 lbs. 1 lbs. 1 lbs. 1 lbs 1 lbs. I lbs. I lbs. 1938 .54 3.70 4.09 .17 .14 .03 .20 .32 .31 1.17 5.26 1939 .51 3.70 4.07 .23 .20 .05 .27 .37 .22 1.34 5.,41 1940 .54 4.20 4.59 .22 .ll .03 .34 .32 .32 1.34 5.93 1941 .50 4.30 4.66 .27 .09 .04 .33 .44 .12 1.29 5.95 1942 .43 5.80 6.11 .13 .22 .03 .23 .34 .01 .96 7.07 1943 .56 5.60 6.00 .03 .23 .05 .37 .37 .04 1.09 7.09 1944 .74 6.10 6.63 .ll .35 .10 .40 .41 .05 1.42 8.05 1945 .57 5.40 5.81 .18 .33 .10 .37 .38 .06 1.42 7.23 1946 .45 4.20 4.53 .21 .35 .13 .20 .38 .19 1.46 5.99 1947 .46 3.80 4.13 .21 .30 .08 .30 .33 .23 1.45 5.58 1948 .46 3.90 4.23 .24 .29 .09 .43 .37 .24 1.66 5.89 1949 .42 3.50 3.80 .25 .26 .10 .30 .41 .27 1.59 5.39 1950 .43 3.90 4.21 .32 .32 .06 .30 .36 .23 1.59 5.80 ..., 1951 .49 3.90 4.25 .33 .29 .08 .37 .42 .13 1.62 5.87 • 1952 .49 3.80 4.15 .27 .25 .09 .35 .41 .21 1.58 5.73 1953 .46 3.80 4.13 .30 .24 .06 .48 .32 .18 1.58 5.71 1954 .41 3.70 4.00 .35 .22 .08 .21 .38 .22 1.43 5.43 1955 .37 3.60 3.87 .40 .20 .07 .33 .42 .18 1.60 5.47 1956 .30 3.90 4.12 .34 .27 .04 .40 .35 .15 1.50 5.62 1957 .41 4.00 4.30 .34 .19 .09 .30 .32 .25 1.50 5.80 1958 .40 3.90 4.19 .38 .18 .07 .38 .39 .18 1.60 5.79 1252 14Q 4162 4142 .3§ 14~ 108 167 16§ .is 1.~Q ~122

~ Data do not include inventory adjustments, except for peanuts. For peanuts, year begins September 1 through 1947, August 1 after 1947. For cashews, year

is calendar year. for other tree nuts, year is crop year. 'JI Sum of shelled peanuts, and in-shell (cleaned) peanuts as converted to shelled (kernel) basis

by multiplying by an average conversion factor of 72.28%. ~ "other tree nuts" include Brazils, chestnuts, pignolias, pistachios, and miscellaneous tree

nuts. Sources Agricultural Marketing Service, u. s. Department of Agricultures

and "Fruit Situation" (181 19). "Fats & Oils Situation"

75

atated previoualy, the United State• Tariff COllllli••ion'• ataff feel• that

the proportion of caahew• aalted baa not changed •ipificautly •illce 1953.

Conaumption of •helled pecaua during the period.a October l, 1950, to

September 30, 1953, (lateat atati•tic• available) baa run aa follow•:

aalted - 7.3 percent, houaehold (unaalted) - 12.2 percent, ice cream -

12.2 percent, caucly - 19.5 percent, baked gooct. - 43.9 percent, and other

ua•• - 4.9 percent. Th••• u••• of •helled pecaua accOUDted for about 65.2

percent of all pecan conawaption (•helled baai•).

Coaaumption of •helled walnut• waa divided among for11111 aa follow•,

during the 1950-1953 period (lateat •tatiatic• available): baked gooda -

39.3 percent, ~dy - 10.7 percent, houaehold (uualted) - 39.3 percent,

and other uaea (ice cream and mi•eellaneoua) - 10.7 percent. Thu• uaea .. of •helled walnut• accounted for about 46.6 percent of all walnut con-

•umption (Gelled baaia). Walnuta are •eldom aalted.

CoD8\1Ulption of •helled allDOJld9 waa divided among foraw during 1950-

1953 (lateat atatiatic• available) aa follow•: aalted - 1.8 percent,

candy - 64.1 percent, and other uaea (baked good•, houaehold, and ice

cream, mainly) - 23 .1 percent. Th••• uae• of •helled almonda accounted

for about 95.6 percent of all almond conaumption (•helled baaia).

Conaumption of •helled filberts waa divided among foraw during 1950-

1953 (lateat atati•tic• available) aa follow•: aalted - 42.9 percent,

candy - 28.6 percent, and baked good.a - 28.6 perceut. These uaea of

•helled filberta accounted for about 58.2 percent of all fiittert

conawaption (•helled baai•).

Conaumption of shelled Brazil uut• waa divided 8llODI for1111 during

1950-1953 (latest atatiatica available) aa follow•: aalted - SO percent,

76

candy - 33 percent, and other U8e• (moatly baked aooda) - 17 percent.

The quantity of each nut going into each form ia •hovu in Table•

21 and 22.

The relative importanee of peanuta, caahew•, and other nuta in the

conaumption of •alted uuta i• •howu in liaure 12. Over the 1947-1959

period, •alted nut con8umptiou baa run 70.96 percent peanut•, 22.28

percent caahew•. 2.52 percent almonda, 1.48 percent filberta, l.26 per-

cent pecan8, and 1.5 percent other nuta (1109tly Brasil nut• and

piatachioa). Yearly data are •hown in Table 23. The outataadilag import-

ance of peanut• (••pe~ially Virginia type) and caahewa in the United

State• pattern of aalted nut con8umption i• clearly ahovu.

ConaU111Br purcbaaea of aalted peanuta and tree nuta, aa divided

between aalted mixed nuta and aalted nut• purchaaed unmixed, were eatimated

by the United State• Tariff Coml:l.aaion for the period October 1. 1950,

to September 30, 1953. Al•o eat:l.mated were proportion.a of each kind of

nut and nut product aold at retail in varioua type• of pack&& ... Proportiona of each kind of aalted nut •old in mixture• were aa

follow•: peanuta - 5 perceat, caa.hewa - SO percent, alllllDlld8 - 85 percent,

filberta, and Brasil nuta - 99 percent. There are two general type• of

aalted nut mixture• aold: comparatively expenaive mixtur .. of tree nut•

alone, and cheaper mixture• of tree nuta with peanuts. Only aalted caa-

hewa and aalted peanut• are aold unaixed in large amount•.

The quantity of nut• •old according to the type of packag1ng in which

each kind of nut aDd nut product vu aold at retail vaa eatimated by the

Tariff Comaiaaion for the 1950-1953 period (iatimate• include amount• of

each nut aold in mixed nut paekagea) (Table 24). The tabla alao ahov•

77

Table 21. Consumption of Edible Peanuts and Tree Nuts in Various Forms. United States, Annual Average of Years Beginning October l, 1950-1952

Form in I I I I I I Which I I I I Sold to 1 Peanuts a Cashews 1 Almonds 1 Filberts• Pecans 1 Walnuts a Brazils Consµmers 1{mil.lbs,)1(mil.lbs,)1(mil.lbs.)1 (mil .lbs.la Cmil .lbs,) a (mil .lbs,) a (mil .lbs,)

Shelled Nutsa Salted 155 43 Candy 125 3 Baked Goods 5 2 Household

(Unsalted) lee Cream Peanut Butter 315 other 5 l/

5 3 25 2

3 2 4 ll 2 ll ll l/

3 3 8 3 2

18 ll l 5 ll ll 5 1 JI 2 2 ll

----------------------------------------------------~ Total Shelled 605 48 39 7 41 28 6 In-Shell Nuts 74 10 10 35 82 16

Total Shelled 679 48 49 17 76 110 22 and In-s e

l/ Probably less than t million pounds. Sourcea United States Tariff Commission information collected from brokers,

shellers, and representatives of consuming industries, for tree nutss peanut data from United States· Department of Agriculture. Data as collected refer to estimated sales through various outlets (types of processing for final consumer products) (12).

Table 22. Consumption of Edible Peanuts in Various Forms, United States, Annual Average of Years Beginning August l, 1953-1958

Shelled• Salted Candy

Form in Which Sold to Consumers

Peanut Butter other Uses and Unreported

Total Shelled In-Shell (Cleaned Roasting Stock) Total Shelled and In-Shell

I I

Quantity (mil. lbs.)

159 126 335 ~ 649 ~ 717

Sources "Fats & Oils Situation", Agricultural Marketing Service, U. s. Department of Agriculture (18).

78

• •

• I .2

79

Table 23. Consumption of Peanuts and Tree Nuts as Salted Nuts, United States, 1947-1959. (Quantities in lhousands of Pounds)

I I I I I I • Total • I I I I I •Salted

YearJ/1Peanuts1Cashews1Almonds1Filberts1Pecans1Qther Nutsa Nuts

1947 123,966 27,410 5,292 2,880 2,057 2,456 164,061 1948 121,937 31,819 5,205 3,296 3,000 2,512 167,769 1949 119,073 33,596 4,749 3,728 2,130 2,482 165,758 1950 118,160 44,442 5,943 2,274 2,166 2,629 175,614 1951 138,806 45,243 5,481 3,086 2, 718 2,969 198,303 1952 142,034 37,688 4,805 3,531 2,615 2,898 193,571 1953 150,101 42,739 4,689 2,392 3,645 3,094 206,660 1954 148,986 50,660 4,374 3,246 1,623 3,175 212,064 1955 143,255 59,480 4,047 2,891 2,596 3,226 215,495 1956 151,493 50,416 5,560 1,681 3,201 3,228 215,579 1957 169,122 52,313 3,982 3,850 2,444 3,522 235,233 1958 173,121 59,815 3,836 3,045 3,149 3,693 246,659 12~2 1861§~6 ~2.75, 2.10~ 3.~Q 6.,12 ~.267 6~'·'~3

JJ Peanut and cashew data on calendar year basi&J other nuts data on crop year basis.

Sources 1 Peanut data from unpublished tabulations by the Crop Reporting Board, U. s. Department of Agriculture; cashew data from Table 18; data on other nuts from per capita data in Table 20, as multiplied by population estimates from U. s. Bureau of the Census, and as further multiplied by average percentages salted of almonds, filberts, pecans, and other nuts as shown in Table 21.

Table 24. Edible Nuts1 Form in Which Sold and Type of Packaging for Nuts Sold at RetailJ United States, 1950-1952, and 1954-1955

Estimates for Annual Av. Quantities, Av. of Years Types of Containers in Which Consumers Begio11!m Qsc:t22!1: 1. 1252::12~6 Had Bought Nuts, 19~-1955, As Reported

Approximate txes 2f P1,~agiog in Whisb Rgtailed in Consumer Survev Quantity Bulk includ- P£ee2ck9ged in

Sold ing vending Transparent Bulk & Type of Nut At Machines and Film Glass Cellophane Vacuum Into Glass

and RetailV paper bags Bags Cans Jars Bags Cans Paper Bags Boxes Jars Outleti/ MU. Lbs. Pct. Pct. Pett Pct. Ps:t. Pct. Pct. Pct, Pct. Peanuts

Salted 155 40 40 20 63 53 46 12 7 Peanut butter 315 100 In-shell peanuts 74 60 40

Almonds Salted 5 70 10 20 Househol~ 4 5 20 75 In-shell 10 10 90 CD c

Filberts Salted 3 70 10 20 In-shell 10 10 90

Pecans Salted 3 70 10 20 Househol~ 5 10 25 65 In-shell 35 20 80

Walnuts Househol~ ll 20 70 10 In-shell 82 10 90

Cashews Salted 43 50 35 15

Brazils Salted 3 70 10 20 In-shell 16 10 90

Shelled Tree Nuts, Generally 74 44 32 10 6

Table 24. (Continued)

l/ Breakdown as to type of packaging for salted and in-shell nuts includes quantities retailed as mixed nuts.

'£/ lhese quantities may overstate the retail sales of peanut butter by perhaps 20% and of salted and in-shell nuts by perhaps 10% in that a portion of the nuts in these outlets is sold to food processors or institutional users. Because of the roughness of these estimates no attempt is made to adjust these quantities for an overstatement of retail sales.

'JI Percentages add to more than 100, because some consumers had bought nuts in more than one type of container in 1954-1955.

~ Household (unsalted) Sources• For 1950-1952 data, United States Tariff Commission information obtained from brokers, shellers

and representatives of consuming industries. (12) 1950-1952 data for peanuts from u. s. Department of Agri-culture (12). Percentage breakdown as to the type of packaging estimated. For 1954-1955 data on packaging, source is Marketing Research Report 203, Agricultural Marketing Service, u. s. Department of Agriculture (24).

OD ....

82

••tim&t•• for ••lted peanut• and •helled tree auta (•alted aad uaaalted -

all kind8 in general) made by the United State• Departmllnt of Agriculture

for the 12 lllDllth period. preceding a 1955 cona\11119r aurvay.

Conaumar Survey lleaulta (24)

ConaU11era' U8e of and opinion.a concerning peanuu, tree nut•, pea-

nut butter, and candy containing nut8 were •tudied by th• United Stat••

Department of Agriculture in a •urvey made in 1955 amoaa a natio111id•

•ample of homemaker•. Thu ruearch, baaed on hwuker•' U9e (or non-

u••) of nut• and thetr product• during the year preceding th• aurvey,

ia reported in detail in the Departmllnt'• lfarketi.Dg Jleaearch lleport

Ho. 203, ''Hammaker•' Uae of and Opiaiona About Peanut8 and Tr•• Nuta",

publiahed in 1957. Important answer• given by hOllemakera in the •ample

are auaurised in percentage term in Table 25. (ror detailed break-

dowu of anawera by aize of family inc011a, education and aa• of homamaker,

number of children in family, and •i•• of commuRity lived in, conault

the oriainal reaearch report.) Homuiaker• ' anawer• will only be dia-

cuaaed here aa they pertain to aalted peanuta and cuhev•. Their anawera

concerning cuhewa •hould be conaidered _. dealing with aalted cuhewa,

•inc• 90 percent of all cuhew couumption ia ••ti.mated to be in the

form of aalted nuta, and ca•hew1 not purchaaed by c<maU1119n u aalted

nut• and bought in candy and baked gooda.

About 70 percent of the homnakera interviewed •aid they occuionally

U9ed aalted peauuta. Among the U9era, 36 percent ued th• every week

or tvo, 28 percent U9ad them about once or twice a month, 22 percent U8ed

83

them l••• thau once a month but more than three time• a year, aacl 14

percent uaed them three time• a year or l•••·

Th• moat COlllllOll way in which aalted peanut• were uaed by homa .. kera

waa in anacka; 99 percent of the aalted peanut uaera uaed thin thi•

way. Other uaea were in aalada, toppiD&S, milking candy, baking and.

other cooking.

Homemakers who aaicl they did not uae aalted peanut• gave a variety

of reaaona for non-uae. Th• moat c0111110n reaaona were: 1) aomou in

the family had a apecific phyaical ailment (ulcera, all•r11ea, eeaema,

falae teeth, etc.); 2) aalted peanut• are hard to di1eat1 3) did not like

them (for unapecifiecl reaaona)) and 4) clialike their taste.

Only four percent of th• non-uaera interviewed thoupt that aalted

peanuts were too expenaiv• to uae. Similar reaultit were obtained for

routed (in-ahell) peanut• and peanut butter, inclieated that expeaaiveneaa

waa of minor conccni to cona~~f. Cbly three percent of the non-uaera

of each of th••• products felt that they were too expenaiv• to uae. It

thua appear• that peanut• and their products are not unduly expenaive

in relation to their uaefuln••• to conawaara, in th• opinion of the home-

maker• interviewed in the aemple aurvey.

Tumiug to caahw nuts (aalted), about 43 percent of the hommakera

in the •ample told interviewer• that they occaaionally uaed them. Among

the uaera, 15 percent uaed them every week or two, 24 percent uaed them

about onee or twice a month, 27 percent uaed them l .. • than once a month

but more than three time• a year, and 34 percent uaed thea three tU.a

a year or leaa.

84

llo information w.. obtained regarding way• in which homlmakera uaecl

aaltecl c .. hew•. The author believea, however, that the pattern of aalted

c .. hew uaAae would probably be quite aimilar to the uae pattern reported

for aalted peanuta. If thia ia tsue, then the primary uae of aalte4 c .. -

hew• would be in anacka, with other uaea bein& in aalada, toppiaa•, making

candy, baking, and.other cooking.

BOllllUlilkera who aaid they did not uae aalted ca.hew• gave a number .. of different. re .. ou, the .,.t COllBOUI a.>ng which were: 1) too

expenaive; 2) never tried thea, or never think of uaing them, 3) did

not like thea (for U118pecifiecl reaaona), and 4) dialika ~heir t .. te.

Uaera of peanut• and tree nut• reported that they moat frequently

purcha.ed nuta at food atorea, urketa, and delicateaaeu. Other pointa

of purcha.e reported were "di• atoreatt, department atorea, apecial nut

or candy ahopa, and drua a tore•. (Thia information w .. obtainad for

peanuts and tree nuta in aeueral, and i• not available for aalted peanuta

and c .. hewa, specifically.)

Major it... of conaumar information about nut• and nut product•

other than aalted peanuta and c .. hewa uy be learned by atuclying

Table 25.

Price• (18i 19)

Price• received by United State• 1rowera for peanut• and clom9atic

tree nut• are ahown in Table 26, covering crop year• 1929 through 1960.

Amona peanuta, Virginia type uaually bring the bigheat averaae fara

pricea, followed (in deacending order) by Spaniah and llunner type•.

Table 25. Consumer Use of and Opinions About Peanuts and Tree Nuts, United States, Survey of Homemakerli, 1955. (Responses to Questions are Given in Tenns of Percent of Homemakers Making Specified Replies to Specific Questions

about Specified Prod,,cts .)l,/

: H.omemakers 1 Responses to Questions, by Nuts and Nut Products (Percentages Making Responses): Questions Asked of Homemakers, and Types of Responses Given

: : : : : Any : : : : : : : : Candy :Any: Any : Raw :Roasted:Salted :Peanut:Tree: : : :English: Black : :Mixed:With :Nuts:Peanuts:Peanuts:Peanuts:Peanuts:Butter:Nuts:Cashews±/:Almonds:Filberts:Walnuts:Walnuts:Pecans:Nuts :Nuts

Percentage of users,. among those inter- : viewed · 90 Frequency of use, among users: Every week or two About once or twice:

a month Less than once a

month, but more than 3 times a year

3 times a year or less

Less than once a month

Ways in which used,: among users, at · home, during pre-ceding 12 months:

Snacks Salads Toppings Making Candy Baking Other Cooking Spread

74 28 43

24

18

24

34

97 5 4

12 12

2

70

36

28

22

14

99 11 17 18 19 4

84

68

15

17

48'}_/

98

86 43

15

24

27

34

33

8

15

26

51

68 18 15 20 54 15

20

6

8

18

68

85 6 5 8

25 6

69

19

18

24

39

61 40 22 42 77 15

22

12

14

28

46

56

17

20

26

37

69 34 25 42 74 15

61 82

9

15

22

54 OD

""

Table 25 (cont'd)· Consumer Use of and Opinions About Peanuts and Tree Nuts, United States, Survey of Homemakers, 1955. (Responses to Questions are Given in Terms of Percent of Homemakers Making Specified Replies to Specific Questions

about Specified Products.)!/

Questions Asked of Homemakers, and Types of Responses Given

: Homemakers 1 Responses to Questions, by Nuts and Nut Products (Percentages Making Respoll§_e_s): : Any : : : : : : : : Candy

:Any : Any : Raw :Roasted:Salted :Peanut:Tree: : : :English: Black : :Mixed:With :Nuts:Peanuts:Peanuts:Peanuts:Peanuts:Butter:Nuts:Cashews.~/:Almonds:Filberts:Walnuts:Walnuts:Pecans:Nuts :Nuts

Kinds of Nuts in : Candy Bought by Users: Reasons for Non-use, : ~mong non-users: Have specific physi-:

cal ailment : Hard to digest Too fattening Hard to chew Teo rich Don't like (no reasai specified)

Dis 1 ike taste Shells are a nuis-

ance 9on't have occasion to use

Too expensive Never tries use, or

never think of use Not available in

area Don't know, or no

answer Sticks to teeth or

roof of mouth Too dry Too oily or greasy No children at home

80

17 8 3

15 8

26

4 3

5

6

5

34 14

7

16 11

5 4

4

!±./ 5

13 10

7

19 18

3

4

15 6 5

12

43 14

5 1 1

16 4

!:./ 15 13

5

2

13

4 ,5 3 2 6

12 10

9 21

15

6

8

74

5 2 1 6 1

15 24

1

11 18

8

4

8

3 2 1 4 ii

15 17

1

9 6

20

10

8

28

2 2

1 2

10 22

6 4

13

21

5

1 42

4 3 2 4/ 2

14 9

3

10 18

6

3

6

7 6 1

28 2

1

11 20

9

5

9

(X)

"'

Table 25(cont'd). Consumer Use of and Opinions (Responses to Questions are Given in

About Peanuts and Tree Nuts, United States, Survey of Homemakers, 1955. Tenn.s of Percent of Homemakers Making Specified Replies to Specific Questions

about Specified Products.) .. !:./ Questions Asked of Homemakers, and Types of Responses Given

: Hom.emakers 1 Responses to Questions, by Nuts and Nut Products (Percentages Making Responses): : : : : : : Any : : : : : : : : Cand)

:Any: Any : Raw :Roasted:Salted :Peanut:Tree: : : :English: Black: :Mixed:With :Nuts:Peanuts:Peanuts:Peanuts:Peanuts:Butter:Nuts:Cashews~l:Almonds:Filberts:Walnuts:Walnuts:Pecans:Nuts :Nuts

Where purchased by users: Food store, market,'.

or delicatessen 86 92 Special nut or 20 15

candy shop Drug store 17 10 "Dime store 11

: 30 15 All others :

Hhere purchased most'. 4 3

often, by users1 Food store, market,'.

or delicatesse n 74 85 Special nut or : candy shop 7 6

: Drug store 5 2 "Dime stores" and :

department stores 12 5 Others : 1 1 Not ascertained : l 1

l / Percentages of homemakers answering add to more than 100 in case of certain questions, because some homemakers gave ~ore than one t ype of response in their answers.

2/ Refers to salted cashews , except for those cashews in candy bought by consumers . J/ Includes use of peanut butter in other food preparation besides baking. 4; Less than 0.5 percent. Source : "Homemakers' Use of and Opinions About Peanu t s and Tree Nuts", Marketing Research Report No 203. Agricultural

Marketing Service, U. S. Department of Agriculture, November 1957 .

CD .....

88

Amona tree nuta, almond• uaually have been hiahe•t-priced, followed by

pecau, walnut•, and f ilberta. All domatic tr•• nuta are priced hiaher

than peanuta of each type.

Prices paid by nut aalt•r• for repreaentative grade• and kiada of

peanut• and tree nuta are indicated in Table 27, coveri.Dg the yeara 1933

through 1959.

Pric .. given on peanuts are for the arade moat highly deaired by

aaltera: lxtra Large Virginia Type. Virginia type peaswta are more

highly deaired for aaltina than any other type, and more of thea are

couumad aa aalted peanuta than in any other fona of couumption. Duti11&

the period from 19SO to 1958, 71.7 percent of all peanuts aalted were

Virginia type. The Virginia type peanut cropa of 1949 through 1954 yield

an average of 26.63 percent lxtra Large kernela, according to information

compiled by th• Coamodity Stabili .. tion Service of the United Stat••

Department of Agriculture. Pric .. of Bxtra Large and Madiua Virginiaa

(the main graclea of Virginiaa which are aalted) tend to move together in

about the •- pattern over time and to maintain a very amall apread

between grade•. The•• peaswt price• are average• paid on the baaia I' .0.1.

important ahelliDa and ahippina point• in the Vir&inia-Carolina area,

and are for shelled, raw, unblanched peanuta.

Caahw prices are for 320-count whole kernel• (kernel couut per

pound equal• 300 to 320). More caahewa fall into thia ai•• grade than

into any other, and th••• large whole kernel• are highly deaired by

aaltera. Baaia of theae caahew price• ia r.0.1. Hew York quotatiou by

importers to nut aaltera, for shelled, bl~hed kernels.

89

Price• lieted for al•nda, filberts, and pecau are r .0.1. New York

quotations by primary di•trtbutora, for •belled kernel•.

Ro official tima ••ri•• of retail price atatiatic• i• available for

nut• and their products (except pe.amit butter). Aa an !ndicatioa of

retail •alted nut pric•• in recent yearf, however, the author h.a8 made

•ome random obaervatiOld in varioua •tor.. in Maryland and Virginia.

Th••• ob8ervatiou cover th• period froa lprina, 1956, to Winter, 1961,

for certaill type• of packag .. of peanuts and cul\ewa. ID addition, there

are •oma obaervatiou of pric•• durina Willter 1961 only, for certain

type• of packq.. of peanuts and cuhevl which nr• not followed 4urina

th• period aiDce 1956. ilao, there are Willter, 1961, obaervatiou of

pric•• for aalted mixed nut•, aalted piatachioe, and the follovina un·

aalted nut•: •balled al1110Dd8, walnuts, &QCf. pecau; routed (in·ahell)

peanuts 9 in·•h•ll alaJllcla , walnuts• and Brasil nuts; and iu·•hall aix•d

nuts (without peanuts). Th••• obaervatioaa are reported in Table 28,

ahowina typU and •is•• of packag .. , actual price• for each killcl of nut

and type of package, equivalent price per pouad for each kind of nut

and type of paekaae, and anroxiMt• overall average retail price• per

pound for each kincl of aut and nut llixture observed ia retail atoru by

the author.

The dcmtnance of peanuts and ouhew• in th• pattern of conaumption

of aalted nuu in the United Stat••• and tha dominaac• of Viraiaia type

peanuu among all aalted peanut•, have been ct ... trated in thia •action

on cOldumption of nut• in tba United Stat••·

Price• of aalted nut• at the retail level, and price• paid by

•alter• for their auppli•• of •helled nut• (raw material•) rank u

follow•, by kind of nut: peanut• are the leaat expenaive (Spani•h type

lower than Virginia type), followed by caaheva and filbert• (in an

erratic pattern aa to which i• higher), then almond•, and pecana.

lecauae no long-time aerie• of data are available on retail nut

price• (aalted or otherviae), or on price• paid by retailer• to whole•

aalera for nut•, or on pric .. paid by vholeaal•r• to aalter1, time·

aerie• analy••• of demand and price relationahip• for aalted nut• muat

depend on price• paid by aaltera for their nut auppli••·

Table 26. Pricu lleceived by Growen for Pu.nuta and Tree Jluta; United State•, 1929-1960 (Cea ta per Pourad!/)

Southeutem Southw .. teq All Virgiuia Type Spaniah Pea- SpalU.91' luDMr

Cro2 YearY '-!!!Uta Pu.nu ta au ta Peaauu l••~ta Al__.• 11lberta hc:ana Walauta

1929 3.7 3.3 3.0 2.5 2.1 24.0 15.0 14.7 16.1 1930 3.5 3,5 .. 3.3 3.3 2.3 10.0 17.0 14.9 20.5 1931 1.6 1.5 1.2 1.4 0.9 8.8 12 •. 5 7.8 11.2 1932 ~.6 1 •. 8 1 •. 8 1.5 1.3 8.'3 10.0 6.0 9.0 1933 l.9 3.2 2 •. 8 2.8 2.6 9 •. 3 14.:9 8.0 11.2 1934 3,3 3.,7 4.1 3 •. 5 3,5 9.,0 10.,1 12.6 9.6 1935 3 •. 1 3 •. 5 3 •. 2. 2.,8 2.8 14 •. 0 1.3 •. 2 6.8 10.2 1936 3 • .7 4.2 3 •. 9 3.6 3,3 20 •. 1 l~!.5 12.4 10.9 1937 3 •. 3 3 •. 4 3 •. 2. 3 •. o 2.8 13.,8 10 •. ~ 7.7 9.1 1938 3.3 3.,6 3.,2 2 •. 9 2 .• .7 12.,9 11 •. 3 9.4 11.1 1939 3.4 3.,5 3 •. 3 3.2 2 .,7 10 •. 5 11 •. 3 9.7 8.4 '° .... 1940 3.3 4 •. 1 3.6 3 .. 1 3 •. 1 16.,2. 12 .•. 5 8.9 11.5 1941 4. 7 6 •. 4 6.,2 4.,5 5,3 35 •. 2 15.,3 10.3 12.6 1942 6,1 8 •. 1 8,0 7.4 7.2. 22 •. l 17 •. 6 17 .1 15.4 1943 7,.1 7 .,7 7 •. 4 6.,6 6.8 36.,6 2.5.0 23.0 23.9 1944 8.0 8,8 8.3 8 •. 2. 7.6 37.2 21 •. 0 21.6 22.3 1945 8,3 8 .. 3 8,6 8.3 7.8 36 •. o 27.,6 23.9 25.5 1946 9.1 10,2 9.4 8.4 8.4 24.3 l~ •. i 33~8 27.7 1947 10.l 10.9 10.5 '~' 9.6 27.9 12.-.i 22.6 19.1 1948 10.s 10.8 10.9 10~6 10.3 21.1 ll\'f 12~3 20.9 1949 10.4 12.0 10-.8 10 •. 2 10.0 16.,5 \1,0 18.8 17.6 1950 10.t u.o 11.1 10.5 lo.o 2.7 •. 3 \~\15 28. 7 19.3 1951 10,4 12.7 10~8 10. 7 9.8 23.6 t-1,. 19.7 21.4 1952 10,9 U.,9 10, 7 li~o 10,2 23.2 t&\t 22.0 19.8 1953 11.1 11,8 11.3 11.l 10,1 23.8 \IJ,t 16.1 20.6 1954 12.2 13,2 12.4 14.,o 11.,4 24.9 a.e 28.2 17.5 1955 11.8 14,2 11.6 u.4 10,.6 40,0 ha-i 31.4 - 27.0 19.56 11.z U.6 11.9 12.,3 101-15 40~2 °'I 18.5 . 22.0 1957 10,4 u.4 11,4 11.,4 l.0.1 25~3 15.0 23.·9 21.3

Table 26 (cont'd.) Price• bceived by Grower• for Peanut• and Tree lluta, United Statea, 1929-1960 (Cent• per Pound!/) . · ·

Sout!Maateru Southveatern All Virginia. Type lpaai.ah Pea- lpaniah Runner

Crop Year!/ Peanuta Punuu nuta Peanuta Peamata A1mcnacle Pilberta PeeaDa Walnuta

1958 1959 196o.!/

10.6 9.6

10.0

11.0 10.6 11.l

10.8 9.5 9.8

11.0 9.8 9.4 8._5.

10.0 9.0.

38.6 23.3 24.4

19.0 18.8 21.0

28.1 32 •. 4 30.9

18.9 24.1 26.6

1/ Weight basia i• farman' atock for pemauta, in-ahell for tree nuta. 21 Yeara beginain& aa follow•: All peanuta, September l; Virgillia peanut•, llovaber l; South-

eaatem lpaniah ad aum..r peanuta. September 1; Soutbweatem Spalli.ah peanuta a Auguat i ;_·all tree nut•, crop yeara.

3/ Preliminary. iource: Agricultural Mark•tin& Service, U. I._ Department of Agriculture (18; 19).

'6:J N

93

Table 27. Prices Paid by Nut Salters for Shelled Peanuts and Tree Nuts, United States, 1933-1959.

(Cents per Pound)

1 Peanuts~/ a 1 1 1 , 11 (Va. Type) 1 CashewsV 1 1 1

Xea~a(Extra Large)a(32Q-Count Wbole1)1Alme~1Filb1S)f#/1P1c~ 1933 4.3 23.7 5 5 1934 7 .3 28.l ~ .[/ .[/ 1935 9.0 Z7.0 39.0 31.0 54.0 1936 e.o 26.5 45.o 32.o 35.o 1937 8.1 23.7 57.0 33.0 44.0 1938 7.4 24.2 43.0 28.0 40.0 1939 e.o 23.1 36.o 36.o 43.o 1940 7.9 22.0 34.0 25.0 46.0 1941 9.5 29.4 54.0 43.0 40.0 1942 13.9 53.5 a..o 66.o 41.0 1943 16.4 99.6 89.0 70.0 85.0 1944 16.3 94.4 90.0 77.0 89.0 1945 16.3 96.3 91.0 65.0 88.0 1946 17.6 72.7 85.0 60.0 93.0 1947 22.1 53.9 71.0 48.0 125.0 1948 21.1 54.9 ~o.o 43.o 75.o 1949 22.2 54.9 52.0 34.0 67.0 1950 28.2 46.3 51.0 40.0 89.0 1951 23.5 54.8 70.0 64.0 109.0 1952 23.5 63.2 64.0 46.0 80.0 1953 28.2 53.3 62.0 48.0 85.0 1954 25.6 44.3 62.0 56.0 76.0 1955 29.2 52.9 75.0 57.0 140.0 1956 32.6 55.6 ~ ~61 y 1957 22.0 57.7 !l/_ !l/_ y 1958 24.0 52.0 y §/ w 1959 22.6 51.9 ~ ~ ~

l/ Year is calendar year for cashews and extra-large Virginia peanutsf year is crop year for other nuts showna begins preceding October 1 for almonds, pecans, and filbertss begins preceding November l for No. l Virginia peanuts.

'I:/ Average prices for shelled, raw peanuts, F.O.B. important shell-ing and shipping points.

'JI Cashew price quotations made by importers to nut salters for shell-ed, blanched kernels, F.O.B. New York.

~ Price quotations for shelled almonds, filberts, and pecans by primary distributors, F.O.B. New York.

'iJl. Not available. ~ Not available. Source1 Peanut data computed from "Peanut Market News-Peanut Price

Summary", Agricultural Marketing Service, u. s. Department of Agriculture. Cashew data from Table 13. Data on almonds, filberts, and pecans from "Marketing Tree Nuta--Trends and Prospecta", Marketing Research Report No. 139, Agricultural Marketing Service, u. s. Department of Agriculture, 1956.

94

Table 28. Ietail Prices of Salted Nuta and Other Nuts in Selected Chain Food Storea and "Dime Storea", Eaatern United States, 1956-1961.

Salted Peanuta Salted Caahewa Salted Mixed Nuts : Price

Type and Size of: per Package

In Chain Food Storea--Pre-

packaged: Bag--3 1/8 oz. Bag--3 3/4 oz.

Can--4 oz. Bag--4 1/2 oz. Can--4 3/4 oz. Can--5 oz. Bag--5 1/2 oz. Can--5 1/2 oz. Bag--6 oz. Can--6 oz. Can--6 1/2 oz. Can--6 3/4 oz. Bag--7 oz. Can--7 oz. Can--7 1/4 oz. Bag--8 oz. Bag--9 oz. Can--9 oz. Bag--9 1/2 oz. Bag--12 oz.

Can--13 oz. Can--14 oz. Loose in Bulk

per lb.

In Chain "Dime Stores"--

Package

I 119¢ Spanish

: :29¢ Va. type : 33¢ Va. type : 35¢ Redskin

: 29¢ Spanish :35¢ &39¢Vaa. :29¢ Spanish

:35¢ Spanish :39¢ Vas. :39¢/49¢ Span.

: 69¢ Vas. : 39¢ Vas.

Vas.

Roasted in Shell

Salted on Pre- : mises, Held and: Displayed in Bulk, and Sold in Bag or Box Bag--4 oz. Bag-- 4 1/2 oz.: Bag--5 1/2 oz. :25¢ Vas. Box--8 oz. :20¢ Spanish

:35¢ Vas. Box--1 lb. :39¢ Spanish

I I I

Equiv. Price per lb. :

68¢:

I :

77¢: 88¢:

Price per

Package

29¢

Equiv. Price Price per per lb. Package

1.48: : 29¢ w/peanuts : 39¢ wo/peanuts

1.31:39¢ wo/peanuts

49¢ 1.43: 45¢ 1.31:

:Equiv. : Price :per lb.

1.24 1.66

l.31

86¢: :49¢ w/peanuts 1.21 :45¢ & 49¢ 1.07 & 1.16:59¢ wo/peanuts 1.40

49¢ 1.12:49¢ w/peanuts 1.12 66¢1

77¢ & 86¢1 58¢:

1 69¢ 1.23: 62¢: 6~:

52~/65¢:

89¢ 79¢:6~ & 89¢ 39¢:

:39¢ 73¢: 40¢:69¢ 70¢: 39¢1

1.10: 75¢ & 1.02:89¢ w/peanuts

: 25¢ w/peanuts 1.39:

I 1.38:49¢ w/peanuts

1.02

l.00

.98

95

Table 28 (cont 'cl). Approximate Overall Averaa• htail Pried per Jouncl for:

Salted Peanuta (Virainiaa) Salted Peanut• (lpaniah) laltecl Peanut• (hdakin) Salted Cuheva Salted Piatachioa lalted 111.xad Ruta with Peanut• Salted Mixed Jfuta without Peanut• lh•ll•d illlODda Shelled Walnuta Shelled Pecau Routed (Ia .. lhell) Peanut• In-Shell Almond• Ia•lhell Walnut• Ia~lhell .Hixacl lfuta (without peanuta) In~lh•ll Brasil Muta

$0. 76 .s:s .86

1.21 l.41 l.10 l.46 2.19. 2 .• 21 3.02

.39

.49

.53

.SS

.55

Source: landom obaervationa in varioua ator•• in Maryland and Virginia, by th• author, from Spring 1956 to Winter 1961. The•• obaerva-tiona, which cover aalted peanuta and caahewa moat cloaely, indicate that retail price• of aalted caahewa and peanut• have remained relatively •table during th• period of the obaervationa. Price• other than for aalted peanuta and caahewa were obaerved only in Winter 1961.

96

ANALYSIS or DEMAND AND PllCI llLATIONSBIPS J'Oll PIARUTS AD CASBBWS DI

TRI UNITED STATES, WI'DI IMPllABIS ON 'l'BI IALTID NUT Tli.DB

Pactora Believed to Affect Demand for Paanuta and Caahawa

In view of the demand ralationahipa •uaa••t•d by economic thaory'l./

and knowledge of the nut induatry, and takiDg illto account the atatiatical

data available, it waa decided to perform a time aerie• atatiatical

analyaia of the following factor• believed to determine primarily the

demand for aalted peanut• (quantity demanded repreaented by data on

apparent conaumptian): (l) their price; (2) the price of caahew kernel•

(to determine whether a competitive or complementary relationahip exiata

between peanuta and caahaw nuta); and (3) diapoaable pencmal incom.

Other aaaociated factor• to be teated iDCluded: (1) a price index (to

take account of th• effect• of changing value of money on the demand

relationahip); (2) effect• of riai11& United State• population; (3) and

a linear time trend, ill order to account for chana•• ill the demand re-

lationahip over time which are not aaparately indentifiad. The objective

waa to determille the effect of change• ill each of the foregoing auppoaed

aaaociated factora upon the demand for peanut• aa aalted nut•. Quantity

demanded waa •aaund by data an apparent conaumption of aalted peanuta.

'J_/ Marahall, Alfred, Principle• of Kconomica, Macaillan and Company, Ltd., London, England, 8th edition, 1920. pp. 83-137.

97

In addition to the peanut demand analyaea, aiailar analy••• of demand

for •alted c:aahew•, and for caahewa in all uaea (form11 in which •old to

conauman) , were fora&lated. The demand for caahew• (quantity 11111&8ured

by data on apparent conaumption) wu believed to be detel'llined primarily

by the following factor•: (1) price of caahewa; (2) price of peanut•

(determining the uature of competitive or compl911911tary relationahipa

between cuheva and peanut•); and (3) di•poaable penonal income. Other

uaociated factor• to be teated includeds (1) a price inclex; (2) United

State• population; (3) and a linear time trend.

Th• f oregoina tiaa •eri•• analy•e• of demand for peanuta and caaheva

were expected to yield the followi.Da ••tiaat•• of dem&Dds (1) "price

elaaticity of dem&Ddu for each nut with reapect to it• own price (other

thins• being uncb&aged), which waa expected to provide a .... ure of the

effect of price on conaumption, and therefore the utility of each nut ti to conaUll8ra; (2) "cro••-•laaticity of d--4 for each nut with reapect

to price of the other (that i•, the croaa~elaaticity of demand for peanut•

wit~ rupect to th• price of c .. heva, aacl the cro••-•laaticity of demand

for cuhev• with rupect to the price of peanuta), which ... expected to

iltclicate the exi•t•nc• of competitive or complementary relationahipa

between peanuu and caahev•; and (3) "income eluticity of demand" for

each nut with reapect to conaumar income, which would reflect the relative

ir_pQrtance of c .. hew• and peanut• on conaumara' neceaaity-luxury •oale•

(a.ad how riai.Da levela of conaumer income affect increued conaumption

of peanut• and caahew•)~

98

It waa believed that, with thi• information from the agregate tiM

••ri•• demand analy•i•, the baaic question which aav• ri•• to thia reaearch

would be anawered.

lconomic Variable• Uaed to Maaaure Demand for Peanut• and Caahewa

Naaaur•• of Qu!!tity Dwuc:lecl. Quau.titie• of peanuta and caahew• daaaded

in the United Stat•• were •aaured in two waya: total proc .. aor couump-

ti~, ancl average proceHor couuaption OR a per capita ba8ia. Data on

the total quantity of peanuta and eaahewa proc••••d into aalted nuta in

the United Stat•• (aa reported for peanut• in the United Stat•• Depart-

•nt of Agriculture'• Peanut Stock• and Proc•••iaa report, and u reported

for cubew• in th• detailed diacuaaion of th• caahew incluatry) were uaed

aa the iuc:licatora of apparent total couumption of aalted cuhew1 ancl

peanuta in the United ltatea. Th .. • data were divided by population to

obtain average per capita ••timat•• of conaumption of 1alted peanut•

and cuhew1.

Similarly, data from the aama report•, on the total quantity of cu-

hew• proceaaed for all •nd-ua•• in the United State•, were taken u the

•&aura• of apparent total couumption of cuhewa in all form. Th•••

data were alao divided by population to indicate average per capita con-

aumption of cuhev1, in all form, in the United State•.

Nauurea of factor• Believed to Primarily Influence Dewmd. Becawe no

long tiM ••ri•• of data are available on retail peanut and cuhev price•

(1alted or otherwiae), or on pricea paid by retailer• to wholeaaler• for

nut•, or on price• paid by vholeaalera to 1altera and other proc•••ora,

th••• au.aly1e1 of demand auc:l price relationahipa for peanut• and caahewa

99

were baaed on whole•ale price• paid by aaltera and other proceaaor• for

their peanut and caahew auppliea. The•• price• are the cloa .. t to the

retail level that can be obtained with any dearee of atati•tical accuracy.

Thua, demand for aalted peanuta, aalted caahewa, and total caahewa,

had to be •aaured at the proc .. aor leve 1, where aal ten and other nut

proceaaor• purchaae their aupplie• of peanut• and caahava to be uaed in

producing aalted nu ta and other nut product• for couumn. Dmaancl for

peanuta and caahewa at the retail level camaot be accurately •aaured

becaua• of thi• lack of information on retail price• • Additional

variabl .. , relatina to the behavior of fim8 in the marketing chain be-

tween the final conaumar ancl the level of the market to which the avail-

able price aerie• refer•, ahould be ineluded in the demand equation, if

price• at another level are to be aubatituted for retail price• in making

a deterain&tion of ~emaa.d and price relationahipa at the retail level!/.

In thi• eaae, information (time aeri .. data) deacribing the behavior of

retailen, wholeaaler•, and aalten after tranaactiou between the aaltera

and their aupplien of peanut• and caahew• have been completed, •hould

be included in th• demand analyaia. However, auch information 1a not

available in a atatiatically maaurable form. line• thia information

waa not included in thia ••t of analyaea, the d ... nd relatiomhipa obtained

in thi• atudy d .. crib• dem&lld at the proc•••or level only.

4/ Poote, 1.ichard J., Analytical Toola for ltudytna Deuad a'DCl Price-Structure• (U. I. Departmant of Aariculture Handbook No. 146), u. s. Govermaaut Printing Office, Waahington, 1958, p. 103.

100

In a recent atudy at Oklahoma State Univeraity~/, an eatimate of

demand relationahipa for all paanuta at the proceaaor (wholeeale) level

vu made, which did include an index of marketing chaqea. Thia index

waa celculated in an attempt to eatillate behavior in the marketing chain

from the proceaaor level to the retail level. In what the inv .. tiaatora

couidered to be their beat -uure of d-.ad for paanuta, however, th•

-effect• of the index of marketing charge• o::a per capita demand for pea-

nut• in the United ltatea could not be eatabliahed in a atatiatically

•aningful way.

Th• •aaure of conaumer incoma aa a demand factor, uaed in thi•

atudy, waa "diapoaable peraonal ineoma," aa computed by the United State•

Department of C0111Derce.

Maaaurea of Other factor• Believed to be Aaaociated With 8-nd. To take

into eouideration tho9e poaaible change• over tiJDe in demand achedul••

for peanuta and caahna, which were not •uured by aeparate atatiatical

aeriea, a linear time trend waa included in each eatillating equation.

In model• baaed upon def lated price• and incoma (ef f ecta of changing

valu~ of money removed) , with per capita conaumption and incom (annual

baaia for all data), only the foregoing variable• were uaed.

In the "r•" annual model• (baaed on undef lated price• and total

couuaption and income), however, extra data aerie• were included to

account for demand ef f ecta of population change• (United State• total

~I Badaer, Daniel D. and Plaxico, Jwa S., Selected Supply and Demand Ralatiouhip! in th• Peanut Induatry, (Oklahoma -.ricultural Experiment Station Proceaaed leriea P-338), Stillwater, Oklahoma, 1959, pp. 25-27.

101

population data) and change• in the value of 1110Dey (Wholaaale Price

Index for Procaaaed Fooda).

Timi Perioda Analyaad. Peanut dwnd data ware analyaed only for the

poatwar year•, 1947 through 1959, becauaa detailed data on uae of peanuta

for aaltiug ware not available for th• year• prior to 1944.

C..hew clemancl data ware analyzed for the entire period 1932 through

1959. The firat year for which caahew price data on the Rew York whole-

aale baai• are available waa 1932. All analy••• ware baaed on calendar

year data. 'l'be lataat year for which data were available at the ti.ma the

atatiatieal calculatiou were made waa 1959. Mod•h for caahewa ware

run for the whole period 1932-1959, includina the wa~ yaara, for the

prewar yeara 1932-1941 only, and for th• poatwar yaara 1947-1959 only.

Peanut J>etund An&lyaia. ID view of the for•aoilaa conai••rationa, the

price aerie• uaed tor paanuta waa that for lxtra Lara• Virainia type pea-

nuta, r. 0 .I. important a hell ill& and •hippq point• ia the Virgini&-

Carolina area. Thia price i• indicative of pric .. paid by nut aalt•r•

for peanuta. lxtra Lara• Viraintaa are the grad• and type of paanuta

moat highly deaired by aaltara. Price• of lxtra Lara• and Medium Virainiaa

(the main grad•• of Virainiaa which are aaltad) tend to move toa•ther

in about th• aam pattern over time, and to maintain a vary amall apread

between grad .. (23).

The market effect of caahewa on th• demand for aalted peanuta (com-

petitive or complementary, if either) vaa inveatiaated in taJ:118 of

aaaociation of the price of caahew• with quantity of peanut• conallllled

("croaa-eluticity of demand" for peanuta) • For reuona explained pr•-

vioualy, the price• of cuhew• uaad for demand analyaia were thoaa at

102

the level where nut aalt•r• and other proce••or• obtain their auppli••

of nuta. In th• cue of cuhw•, thia level Mana the tranaactiou be-

tween nut •alter• and cuhew importer• in the United ltat•• who are bued

primarily in New York. Th• u•ociatiou of price of cuhew• with demand

for peanuta WU •Uured in tel'lllll of two price 8erie8 (by &rad .. ) for

cuhew• at thu Rew York wholeaale level. Th••• two gradu are 320-Count

Whole• ancl JA11¢y Piece•, and are the moat coamon arad•• of cuhev• which

are imported by th• United Stat••·

Tbe u•ociation of couumar income with demand for •alted peanuta

("income eluticity of d ... Dcl") wu •uured in terms of the uaociation

of United ltat•• di•po•abl• peraonal income with peanut couU11ptiou.

Cuhew Demand Alaaly•i•. In analysina the demand for culaev• (both for

aalt•d nut• and for total uae• of cuhew•), the analy••• of demand were

run on a bui• aiailar to that deacribed for peanuta, and for •iailar

reuona. Three price ••ri•• on cuhew• were uaedz the two aerie• on

Mew York whole•ale price• di•cua•ed previoualy, and a ••ri•• in which

price• of all grad .. of cuhew• are combined on bui• r.0.1. exporting

countri•• (primarily the port of Cochin in India). The market effect

of peanut• on 6 ... Dd. for cuhew• vu analysed in tel'll8 of the extra lara•

Vir&inia type peanut price ••ri•• previoualy diacuaaed. Th• effect of

di•poaabl• peraonal incom on cuhew demand wu alao atudied. rrom thi8

analyaia, there were obtained the following demand e•till&tea (each ob-

tainecl for both aalted cuhewa and total cuhev•): (1) "price eluticity

of demand" (iu41cattna "cl-m achedule" or quantity-price relatiouahip,

other thinga beina held conatant); (2) "cro••-eluticity of d-.ul" with

reapect to price of peanut• (competition or compl ... ntarity of peanut•

103

with caahewa); and (3) "incoma elaaticity of demand" (aaaociatton of

incoma with conaumption of caabewa).

Statiatical Mathod and TenU.noloay for Thi• Daiancl Analyaia

The atatiatical •thocl uaed ill the waurwnt of cl ... nct ill thi•

atudy waa the conatruction of 11.1ltiptl reareaaion (leaat aquarea) equa-

tiona (or ''mod•l•"). Th••• equationa conaiat of one dependent variable

and aeveral independent variable•, which are believed to influence varia-

tion in the dependent variable.~/.

The equationa of thi• atudy were formulated by u•ina .. aaurea of

conaumption of peanuta and caahaw• aa dependent variablu. The independent

variable• included ill the•• equationa were tho•• auppoaed aaaociated

factor• liated previoualy believed to have important effect• upon influenc-

ing the clew.end for peanuta and caahwa. Data .. aauriDg the dependent and

independent variable• uaed in th••• equation• are ahowa ill Appendix A,

Part 2.

The objective of thi• type of atati•tical analyaia i• to derive an

equation contaillina a coefficient for each independent variable in the

equation which will indicate the net effect of eaeh iDdependent variable

(conaidering the effect• of each other independent variable ill the equa-

tion) on the variation of the dependent variable. Por example, ill a

6/ Oatle, Bernard, ltatiatiu ill lleaearch, Iowa State ColllS• Pr•••, Amea,-Iova, 1954, pp. 117-227.

104

demand equation for peanut•, u•iua aa th• dependent variable a .. aaure

of conaumption of peauuta and uaing aa independent variable• each of the

following: price of peanut•, price of caalunra, diapoaable peraoual iacOlll9,

and time tread, th• analy•i• leada to a net regreaaioa coefficient for

each of the inclepeudent variable•. Th• coefficient obtaiaed for price

of peanuta in auch an equation iudicatea th• net iuf lueuce of peanut

price (iudepencleat variable) upou peanut couaumption (depeudent variable).

Siailarly, th• influence of each iudependent variable upon the dependent

variable 1a indicated.

Detail• of all of the multiple rear•••ion equatioua derived in thia

demand analy•i• are •hown, equation by equation, in Appendix B. Th•••

detail• include: identification of dependent and independent variable•,

the coefficienta .(or "b-value•") for each independent variable, the

"•tandard error" of each regreaaion coefficient, and a teat of •ignifi-

cance for each rear•••ion coefficient.

Th• aignifie&aM:• teat (t2), uaed for each rear•••ion coefficient,

i• the aquare of the ratio between the particular r•areaaion coefficient

and ita atandard error. When thi• ratio for any rear•••ion coefficient

i• f ouncl to have a value which uceeda the comparable "critical value"

of auch ratio aa tabulated by theoretical atatiaticiana, the regreaaion

coefficient i• ·regarded aa "•tatiatically •ignificant." Thia ••na that the regreaaion coefficient in queation differ• aignif icantly from

aero, and therefore play• an 1.m!M>rtant part ill explaining the variation

of the dependent variable. In the table• in Appendix B, a regreaaioa

coefficient i• aignificant if one or two aateriaka are placed beaide the

105

calculated value of it• 1ignificance (t2) te1t. ThUI, the regr•••ion

coefficient• which are •i111if icant may be clearly obaerved in the table•

of AppeDllix B.

In order to deteraille the elaaticity of demand for 1alted peanut1,

1alted caahew1, or total 1helled edible caahew1, frOIR a &iven regre11ion

equation, the coefficient of each independent variable with re1pect to

- which the el&1ticity of demand i1 to be .. aaured muat be couverted to

a proportional value. Thi• i• dona in all equation •&1uring demand for

aalted peanut•, for example, by makiDg the convenion on the coefficient

obtained for the price of peanut• variable, in order to eatimate "price

el&1ticity of demaad" for 1altecl peanuta from auch aa equatiOll. Con·

veraion i• accompliahed by 1111ltiplyiD& the coefficient by the ratio

between the obaerved .. an value• of the iadepe11dent and dependent variable•,

reapectively. u aa example of auch convenion, conaider ''Model B" of

the demand analy1i1 for aalted peanut• (equation number 7b in Appeadix I).

Thi• equation i• baled on per capita conaumption of aalted peanuta, aa

aaaociated with ahellina point price of btra Lara• Virginia type peanuts,

vholeaale price of c&1hew ~ancy Piece•, per capita diapoaable peraonal

incoma, and ti.mil trend. (Pricea were deflated by the wholeaale price

index for proce11ed foodl, and per capita incOllW waa deflated by the

conaumar price index, to eliainate variation due-to chan&iD& value of

money.) Th• mathematical model i• aa follow•:

t 5 (aalted peanut conaumption) • a function of

X7 (peanut price) , X2 (caahew price), Xg (incOM)

and x13 (ti.11111 tread).

106

After the narueioa cal~ulatiou were perfomad, the followU. regree1icm

coef ficienta were obtaiaedt

peauut price c .. hav price ill.COl8 tiM trencl

- 0121** ' * ,00468 ,00053 ,0299

teareaaion coefficient• were coavarted. to •laaticity value.a by the follow-

iq fonula:

11 .. ticity • leare•aiOD Coeff ioient ti.Ma <ifil •

where I ia the •an value of th.• inclependeat variable (aucb. aa price)

&Del Yi• the .. an value of the depenclaat variable (•uch aa coaaumption)•

l'or equation 7b the coaaraion calculation ia aa follawa 1 for the

"price el .. ticity of demand" for aaltecl peanut•:

"Price llaaticity of Demand" • -.0121 time cX7/Ys) • -.0121 timaa (23.71/.90) • -.0121 (26 .34)

!'Price 11 .. ticity of Demand" • -0.32

Similar calculatiou v•r• ucle to obtain "croea-elaaticity of demand"

with reapect to caahew price, and "income •l .. ticity of demand". When

the regreaeion coefficients ..,.ro converted, the following •l .. ticity

valuu vere ootained ("point" elaaticity at the •au of the obaervation•):

peanut "price eluticity" "cro••-eluticity" with rupect to cuhew price "incom eluticity"

-0.32 0.19 0.81

The eluticity values thus obtained indicate the net effect of a one

percent change in the value of eaeh uaociated factor, such u price or

incom, on percentage change in the value of the dependent variable, con-

•umption, and thus provide estimate• of demand and price ralationehipa

for salted peanuts, salted cuhewe, and all •helled edible caahewe.

"' \

107

In aUlllDllry. thi• procedure vaa followed to determine from each equa-

tion an eatimat• of: (l) the elaaticity of demand with reapect to price

of the nut beina analysed; (2) cr08•-•laaticity of demand with reapect

to price of th• competina or compl ... utary nut; and (3) the elaaticity

of demand with reapect to diapoaable peraonal income.

Proa each ,.anut equation, there were obtained net value• of the

elaaticity of d ... nd for peanut• with reapect to peanut price, cro••-

elaaticity of d ... nd with reapect to caahev price. &Del elaaticity of

demand with reapect to diap09abl• per•onal incoma,

rroa each caahew equation, there were obtained net .. tillat•• of th•

elaaticity of demaacl for caahew• with reapect to caahew price, cr08•-

elaaticity of demand with r .. pect to price of peanut•. and elaaticity of

demancl with reapect to diapoaabl• penonal inc~.

Detail• of each equation derived in thi• analyaia are provided in

Appendice• A and B, and are aU11D&riaed in the follovina paraarapha for

each model.

.

108

llaault• of Demand Analy•i• for Salted Pe&Dut•

Identif icatiou o~ lconomic Variable• in Demand Hodel•:

Y5 • • • X7 •. •

y6 ••• Xa • • • X4 • • • X5 • • • X10• • •

X13• • •

Per Capita Conaumption of Salted Peanut• Price of P•&DUt• (lxtra Large Virainia type), Deflated by Wholeaal• Price Index for Proo•••ed rooda Def lated Price of Caaheva (320-Count Whole•) Def lated Price of C .. hewa (Janey Piecea) Per Capita Diapoaable Peraonal Income, Deflated by Couumr Price Index Total Conauaption of Salted Peanut• Price of Peanut• (lxtra Lara• Virginia type) Price of Caahav• (320-Count Whole•) Price of Caahew• (Janey Piece•) Diapoaable Peraonal 1Dcome

Tim Trend

Wholeaale Price Index for Proceaaed Poocl U. I. Populatiou

lquatiou Humber :

in Tim

- : Demand 11 .. ticity with bapect to:

Price : 1rice : of of

Model• Conaidered : Appeadix I: Periocl :Peanuta:C .. Jaeva:IDcoma . • A. Y5•P(X7, 11' X9• X13) 7a : 1947-1959: -0.27 0.002 0.50

I. Y5•P(l7, 12, 19, X13) 7b do. :· -0.32 !:.!! 0.81 . • C. Y6•1'(Xa, '4• 110• lu,: 8• do. -0.27 : -0.06 0.91

X12, X13) D. t 6fl1(Xa, 15, 110• Xu,: Sb do. -0.43 0.21 : -0.82

112, 113) l

(llote: The related coefficient for the p~ic• el .. ticitie• which are underlined i• atati•tically •ignificant. ror all el .. ticitd.•• not underlined, the related coefficient i• not •i&Dificant.)

Pour annual model• are conaidered in analy•ina demand for aalted

peanut• for 1947 throu1h 1959. Model A i• b .. ed on per capita aalted

peanut conaumption, .... aociated with •h•llina point price of lxtra

Lara• Virginia type peanut•, wholeaale price of 320-Count Whole caahewa,

109

per capita di•po•able peraonal income, and ti• trend. Price• were

deflated by the wholeaale price index for proceaaed fooda. Per capita

incom waa deflated by the conaU111er price index. Model B i• •imilar

to Model A, except that a different aet of cuhev price• ia uaed: the

deflated whol .. ale price of Janey Piecea.

Model C i• baaed on total conaumption of aalted peanuts, u uao-

ciated with undef lated •hellina point price of lxtra Large Viraillia type

peanuq,uncleflated vholeaale price at 320-Count Whole cuheva, uncleflated

total diapoaable peraonal incom, and time trend, with the acldiUon, u

extra factor•, of vholeaale price index for proceaaed fooda (to account

for aenaral price level Challa .. , i.e. chanaea in value of lllOD8y), and

population data (to reduce total quantity conaumad to a per capita bui•).

In effect, Modal C deacribe• a relationahip •illilar to that of Model A.

Moclel D deacribe• a aillilar relationahip to that of Model B. It

containa the •- facton aa Model C, except that the caahev price aerie•

uaed i• changed to uncleflated vhol .. ale price of Janey liac ...

ID addition to th••• llOdela, certain equationa baaed on quarterly

and •nth~y data for 1947 throuah 1959 were run. Th••• were ••t up on

the •- baaia u Model• C ancl D, except that extra variabl .. were added

to aoma of th- to remove aeuonal variation effect•. The•• equationa

did not reveal any demand and price relationahipa not already auggeated

by the annual equationa. Bo analyai• vaa made for the yean before 1947

becauae of lack of -anillgful data.

Model I i• th• beat of the amwal aalted peanut demand equationa, in

term of atatiatical •ipif icance. It i• conaiatent with Model A inaofar

u peanut price coefficienta are concerned. Lack of conaiatency between

110

the•e two model• aa to caahew price coeff iciente i• not readily explain•

able. Reference to the cashew price aerie• for 320-Count Whole• (X1) and

Fancy Piece• (X2) •usae•t• that theae two eerie• are not highly correlated

with each other, in that the year to year chanae in the price of one grade

i• frequently in the opposite direction to the correaponding change in

price of the other grade. Th• reaaon for thi• difference might be explained

by quantity data for each of the aradea, but data of thi• nature are not

available.

In general, the elaaticity value• for demand for aalted peanut• with

reapect to the price of lxtra Larae Virginia peanuts were derived from

atatiatically aignificant coefficient•, and were inelaatic (le•• than one).

Thi• .. ana that a one percent change in the price of lxtra Large Virginia

type peanut• i• aaaociated with about a 0.32 percent change in demand of

nut •alter• for peanut•, auch cbanae being in the oppoaite direction to

that of the change in price. Thi• i• conaiatent with the inverae relation-

ahip between quantity demanded and price •usa••ted by economic theory.

The cro•• elaaticity of demand value• for aalted peanut• with reapect

to price• of caahewa paid by nut aalten are not, in general, ••nialful.

Only one of the four auch value• obt .. ined waa baaed on a atatiatically

•ianificant coefficient, and the value• obtained are ao emall that they

indicate that the price of caahew• paid by nut •alter• baa little influence

on nut aaltera' d ... ncl for peanut•. Theae elaaticity value• do, in general,

•uaae•t that auch little aaaociation a• price of caahew• had with demand

of nut aalt•r• for peanut• point• to a •lightly competitive relationahip

between peanuta and caahewa, rather than a complementary relationahip.

Ho .. aninful ef fecte of change• in diapoaable peraonal incom upon

aalt•r•' demand for peanut• could be aacertained from thi• analy•i•.

111

l.e•ult• of Demand AD&ly•i.8 for lalted C..hev•

Identification of Bcoaamic Variable• in Dmnend Hodel•:

Y1 Xl ... ...

Per Capita COIMlumption of Salted c .. hew• Def lated Price of c .. hev. (320-Count Whol••) Def late4 Price of c .. hev• (larJJCy Piece•) X2

X3 ... Deflated Price of Cubew• (All Oracle• Combined, P,O.B, lxportina Countri••)

x7 ... Def lated Price of reaa.ut• (Batra Lara• Virginia type) X9 ••• Per Capita Di•po•able Par•oul Incom, Deflated by Couumar

Price Inclu

Y3 ... Total Coaaumption of laltad c .. hev• X4 ••• Price of C..hev• (320-Couut Whole•) X5 ... Price of c .. hew• (fancy Piece•) X6 ••• Price of Cubew• (All Orecl .. Combined, '.0.1. lxportina

Countri .. ) Xa ••• Price of Peauuta (Bxtra Lara• Virgini .. ) XlO ••• Di•po8able Per•OD&l IucG1119

X13 ••• Time Trend

Xu ••• Whole•ale Price Index for Proc .. •ed foocla Xl2 ••• U, 8, Population

:Demand llaaticiti•• with lquation : bal!Ct to:

Rumber : : Price : Price : ill Tim of : of :

= Model• Couidered :Appeuclix B: Period :C .. hew•:Peauut•:Iucome

A. Y1 •P(Xi, X7, X9, X13) la : 1932-1959: -o.so 0.19 I 0.48

1 • Y1 -r(X3, X7, X9, X13) le do. -0.08 0.16 : -1.44 .. . c. yl -r(X2• X7, X9, X13) : le do. -0.43 0.30 0.05 . • D. Y3•rcx., ~, X10• X11•= 4a : 1932-1959: Q.ill. 0.16 0.05

X12. 13) : I, Y3•PCX6, X9, XlO• X11,: 4c do. 0.11 0.04 :-3.90

X12• X13) : : r. Y3•P(X5, Xa, X10• Xu,: 4e : do. -0.39 0.25 : -0.90

X12, X13) G. yl .P(Xl' X7• Xg, X13) 2a : 1932-1941: -o.28 0.43 l.16

B. yl =1(X3. X7, X,• X13) 2c do. -0.35 0.52 l.18

112

Continued :Demand llaaticiti•• with

lquation llu!!Ct to: Number . : rric• : Price : .

in TU. of of Moclel• Conaidered :Aependix I: Period :Caahev•:reanut•:Incama

I. yl Sf(X2' X7, X9, X13) 2• do. -0.09 0.57 1.16

3. Y3SfCX4. xi. X10• Xu·= Sa : 1932-1941: -o. 77 0.43 0.65 X12• 13) :

I'.. Y311J'(~, xi. X10• Xu,: Sc do. -0.52 0.68 0.49 X12• 13) :

L. Y3•F(X5. xi. X10• Xu,: Se do• O.Ol 0.40 : -0.16 X12• 13) :

3a : 1947-1959: M. Y1 llJ'(Xl• X7, X9, X13) : -0.68 • o.2a 0.23 •

•• yl •F(X3, X7, X9. X13) : 3c do • -o. 79 0.26 0.61

o. yl =r(X2• X7, X,1 X13) : 3e " do. : -o.so : o.44 2.70 . :

r. Y311J'(X4, i• X10• Xu,: · 6a : 1947~1959: .. o.so 0.29 : -l .44 X12• 13) :

Q. yl -r<X(., i• X10• Xu,: 6c do. : -o. 78 0.26 0.25 Xu• 13)

do• -o.44 a. Y3•f(X5, i• X10• Xu,1 6• 0.63 0.89 Xu• u>

(Note: Th• related coeff ieient for th• price elaaticiti•• which are underlined i• •tati•tically: •ipificant~ for all el»ticiti•• not underlined, the related coeffi.:ient i• not •iplificant.

lighteen anaual llOdel• are conaidered ill analy•iDa 4.-.nd for •alted

cuhev•. Model• A, 1 1 C, D, !, and r eo~~1· the period 1932 through 1959

(the eatire period for which data were available when the analy•i.8 vaa

run). Model• G, B, I, J, 1'.1 and L cover tha prewar yean 1932 through

1941, and model• H, R, o, r, Q, and a cover th• poatvar yura 1947

throuah 1959. these analyaa., Ollittiq the vartim yean 1942 throuah 1946,

a~ conaidered to avoid apurioua re•ulta which might \>a produced by

th• peculi•r inatitutional factor• which prevailed durin& tho•• year•

(•uch aa rationing, price ceilina•, aud •hippina •pac• re•trictioua).

113

Model A i• baaed on per capita aalted cashew conaumptiou, aa aa•o-

ciated with vhole•ale price of 320-count whole cashew•, •helling point

of lxtra Larae Virainia type peanut•, per capita di•po•able per•oual in-

coma, and time trend. Price• were deflated by the whol•••l• price index

for proc••••d food•, and per capita income waa deflated by the conaumar

price index. Moclela I ancl C are •imilar to Model A, axcept that differ-

ent ca•hew price ••ri•• were uaed. In Model B, the deflated price of all

arad .. of eaahew•.combined, l'.O.B. exportina countri••, i8 uaed. In

Model C, the deflated wholeaale price of caahew l'ancy Piece• i• uaed.

Model D i• baaed on total couuaption of aalted cashew•, u u•ociated

with undeflated wholeaale price of 320-Count Whole cashew•, undeflated

•hellina point price of lxtra Large Virainia type peanut•, undeflated

total diapoaable peraonal ineoma, and ti- trend, with the addition, aa

extra factor•, of wholeaale price index for proceaaed fooda (to account

for a•neral price level chana••• i.e. chan&•• in value of money), and

population data (to reduce t~ al quantity conaumad to a per capita baai•) •

In effect, HDdel D deacribe• a relationahip ailllilar to that of Hodel A.

In like manner, Model• I and I' de•crib• relationahipa •imilar to thoae

of Hodel• I and C, reapectively.

The model• for the prewar and the poatwar year• contain the •ama

aeta of variable• u the model• for all year• 1932 throuah 1959. The

follovina lik•ne•••• exi•t in the model•' relationabip•:

1932-1941 . Prewar Modela

G B I J It L

lquivalent Model• 1947-1959

Po• twar Mode la M N 0 p Q I.

1932-1959 All Yean ' Model•

A B c D • F

114

In addition to these models, certain equationa based on quarterly

and monthly data for 1947 through 1959 were run. Theae were aet up on

the aame baaia aa Models M, N, O, P, Q, and a, except that extra vari-

able• were added to aome of them to remove aeaaonal variation effects.

Theae equationa, however, did not reveal any demand and price relation-

ehipa not already auggeated by the annual equationa for the poatwar yeara.

Model• A and C are the beat of the aalted caabew demand equationa

for 1932 through 1959, in tel'll9 of atatiatical aignificance. They appear

to be equally valid. Por the prewar yeara, QO equationa were derived

which had any atatiatically aignificant coefficient•.

Por the postwar yeara, Model N i• atatietically the beet. Thi•

outcome ia probably a mathematical coincidence without economic valid-

ity, however. The caabew price ueed in tbia model i• the average price

of all grade•, r.0.1. exporting countri•• (primarily India) at the time

of •hipmnt. leina •o far removed from the proceHor and ratail market

levels, 1a tel'll9 of tranaaction• in the marketing channel, tU. (due a.

order• being placed far in advance of ahipment) and diatance, thie price

aeries probably doe• QOt have the economic validity that ife>leeale caehew

price• have. The only other poetwar llkKlel havina any eta~l.tical eig-

nif1cance i• Model Q, which baa the •am baai• of cashew price• aa Model N.

Tbua, there i• no postwar model wllich i• economically meaningful.

Coefficienta of demand elaaticity for caahewa for ealting, with reapect

to caahew pricea, generally reflect the expected inveree relationahip

between quantity demanded and price. Pew price coefficient• were

etatiatically eignificant, however. In general, the coefficient• obtained

auggeeted an inelaatic relationahip. In other worda, the net effect of a

115

one percent change in caahew price on quantity of caehew• demanded by

nut •alters i• an inveree change-of about 0.46 percent in quantity

demanded.

Cro••-elaeticity of demand for caahew• for aalting, with reepect

to the price of Bxtra Larae Virginia peanut•, wa• indeterminate. Co-

efficient• were not •ignificant, thua, no competitive relationehip

between ealted peanut• and caahewa wae indicated.

Diepoeable per•oD&l income had no diecernible effect on demand for

caahewe for aalting.

116

aaault• of Demand Analy•i• for All Ca.hew•

Idantif icatiou of Economic Variable• in Demand Hoclala:

...

...

... Y4 ••• X4 ... x ••• x5 ••• 6

~ ••• X10 ••• X13 •••

Xll ••• Xiz •••

Par Capita Couaumption of All Caahew• Def lated Price of c .. hewa (320-Count Whole•) Def lated Price of c .. hewa (rancy Piacaa) Deflated Price of Caahewa (All Gradea Combined, r.O.B. lxportina Countri••) Deflated Price of Paanuta (lxtra Lara• Virainia Type) Par Capita Diapoaabla Paraoual Ineom, Deflated by Couaumer Price Inclax

Total Couumptiou of All c .. hew• Price of c .. hwa (320-Count Wholu) Price of Caahew• (rancy rue••) rrica of Ca.hew• (All Grade• Combined, r,O.B, lxportilag Countri••) Price of PaaDUt• (lxtra Large Virgini .. ) Diapoaabla raraonal Income TiM Tra1lcl

Wbolaaala Price Index for Procaaaad looda u. I. Populatiou

lquatiou Humber

: in Time

:Damancl 11 .. ticiti•• with 1.eapect to:

: Price : Price : of of

Kodela Conaidered : Appendix Ba Period :C .. hew•:Peaauta:Incoma

A.·. "t2•r(ll' X7• X9, X13)

B, Y2•rcx,. '1· x,, X13) _, ...... ·:

C, Y2•f(X2• X71 ~· X13) : . D, Y4•r(X4, xi, X10• 111•=

111· i3> : I, Y49"(~, x._, 1 10• X11•:

!ii· 113> : r. Y4-r(X5• Xa.- X10• Xu,: x12, 113>

G. Y2

=P(l1

, X7

, x9

, x13)

B, Y2•r(X3 , x7, ~· X13)

I. Y2•FCX2• X7, Xg, X13)

lb

ld

lf

4b

44

4f

2b

2d

2f

• 11932-1959: -o.so : 0,17 : 0.44

do. -0.09 : 0.14 :-1.43 :

do. -o.40 : o.28 :-0.10

:1932-1959: -0.51 0.15 :-0.14

:

. • do. 0.10 0.·01 :-4.03

do. -o.36 0.22 :-1.35

:1932-1941: -0.26 o.44 1.09

do.

do.

: -0.34 : 0.52

-0.09 0.56

1.11

l.08

117

Continued :Demand llaaticiti•• with

lquation la81!Ct to: Humber . : Price : Price : .

ill Time of of Hodel• Conaiclered : Appendix • : Period :Caahew•:leanuta:Income

: J. Y4=1(X4. II, 110• 111·= Sb : 1932-1941: -o. 77 0.38 0.63

112• 13) : x. Y4•r(X6, II, 110• lu,: 5d do. -0.53 0.60 : 0.48 112• 13) :

L. Y4-r<X5• 1t• X16• X1r= Sf ,: do. -0.01 o.35 : -o .16 ~ 11~· 13) : : :

M. Y2•f (X1, 17, lg, 113) : lb : 1947-1959: -0.67 0.28 • 0.13 . :

N. Y2aJ'(X3' 17' X9• 113) 3d do, -o. 78 l 0.26 0.50

o. Y2•f(X2' 17• 19• 113) Jf do. -o.46 0.43 2.32 . . • . • . P. Y4ef(X4, II' 110• Xu,: 6b : 1947-1959: -0.49 0.32 : -1.50

X12• 13) : Q. Y4•r(X6, ii. 110• Xu,: 6d do. -o. 74 0.29 0.12

X12• 13) : -o.44 •• Y4•f(X5• ~· X10• Xu,: 6f do. 0.67 0.53 X12• 13) :

(Bote: Th• related coefficient for the price •l&aticiti•• which are underlined i• •tatiaticaUy •ianif icaat. for all elaattciti•• not undeilined, the related coefficient i• aot •iau1f1oaat.

liaht••• annual mocl•l• are conaidered in a.aly•iDa demand for all

caahw•. The•• model• are •imilar to their oppoait• auaber• in the

•alte4 caahew damancl analy•1•.

In addition to the••• certain equationa baaed on quarterly and

llOllthly clata for 1947 throuah 1959 were run. The•• were ••t up on th•

.... baai• aa llOd•l• M, II, O, P, Q, and ll, eseept that extra variable•

were added to acme of them to remove .... oual variation effecta. The•i

equation• did not reveal any demand and price relatiDDahipm not already

•uageated by th• &DDUal equation• for th• poatwar yeara.

118

Model• A and C are the beat equation• on demand for all caaheva for

1932 through 1959, in term of atatiatical aipificance. They appear to

be equally valid. ror the prewar yeara, no equatiou were derived which

had any atatiatically aipificaut coefficients. Among poatwar equatiou,

only Model• N &IUl Q ha4 any atati•tical •ipificance. The•• modela, how-

ever, are baaed on a caahev price ••ri•• (all grade•, r.0.1. exporting

countri••) which i• of doubtful ecouoaic validity. Thua, there 1• n.o

poatwar model which 1• eoODG111cally &D.d. atati•tically .. an1Dgful.

Th• relat10D8hipa between quantiti•• of caahev• d ... nd•d by pro-

c .. aora for all end uaea, and price of caaheva, price of peanuts, &D.d.

diapoaable penonal incom, were ob•erved to be about the •- aa com-

parable d-nd relationahip• for aaltecl caabewa. Thia i• to be expected,

in view of th• fact that about 90 percent of the entire aupply of caahew

kernela 1• couumd aa aaltec:l nuta, with the r ... ining 10 percent being

diviclecl between candy and baked goocla. Demand and price relat1onahip•

for all caahew• are •uu••t•cl aa follow• by thi• aulyaia: (1) inelaatic

demand with reapect to caahew price•; (2) not •ipificantly competitive

with peanut•, in terms of cro••·elaaticity of demand with r .. pect to

peanut price•; and (l) no diacernible relationahip between caahew demand

and eoaa--r incoma.

Tentative Concluaiona Drawn Pram DemaDcl Analyaia for raanuta and Caaheva

Concluaiou froa thia d.aaad analyaia are •uu••t•d with reaervatiOD8,

•inc• the aaaociatioa of •om factor• believed to have an influence on

demand by proceaaon for peanuu for aalting, caaheva for aalting, and

caahew• for all uaea, could not be reliably demonatrated. Taking thi•

ll9

into conaideration 1 the following tentative concluaicmm are drllVD from

thi• atudy: (1) demand for peanut• to be proceaaed into aalted nuta i•

inelaatic in that, on the average, a one percent ch&11&e in price i•

aaaociat•d with a change of 0.27 to o.32 percent, iQ th• oppoait• direc-

tion, in quantity of peanuta demanded by •altar•• (2) demand for caahev•

appear• to be aimilarly iaelaatio with reapect to caahev price. in that

a on• peroent ohana• in price ia aaaociated. on the awr .. a, with a change

of 0.40 to o.so percent, in th• oppo8ite direction1 in quantity of oaa-

hewa deaanded for aaltiQ& a8d other uaea; (3) the ceoaa•elaatioity of

demand for peanuta for aalting, with rupect to the price of CNhew1 1

appear• to be largely indeteraiute, beoau1eaf inooMia~nt re1ult1

obtained for the two Mjor grad•• of caaheva; 'DO aipificaat ooefficienta

were obtained for croaa-elaaticity of demand for oaaheva with r••pect to

the price of peanutl; (4) d-ad for peanu~ for aaltiQI appear• to be

aomevhat more iaelaatic than demand for caaheva for aaltina ad for all

uaea; &1'd (5) diapoaable peraonal iacoma Aoefficienta failed to da.na-

atrate any •ilJ'lficant effect upon d811&1Mi for either ... ....,. or peanut•,

for aaltina, at the procuaor level.

The moat raaaonalal.e eatimatu of demand elaaticity ralationahipa

for peanuta and caahewa, obtained in thi• atucly ara aa follow•:

ltind of lfut Time and Pora

Period;: in Which Uaed 1947- Salted Pe&nuta 1959

1932- Salted Caahewa 1959

1932- All Caaheva 1959

: Own Price -0.32

-0.43 to

-o.40 to

-o.so -o.so

Demaad llaaticity with IUpect to1

Price of Other Hut lncOllll 0.19 None

Rone None

Bone None

(Note: ''Rone" inclicatea that the related coefficient obtained ia not atatiatically aignificant .)

120

The•• concluaiona are drawn about demaud for peanut• by nut aaltera

and demand for caahew• by proceaaora of aalted nuta and other nut pro-

duct• ..Se from caahew•. Althouah ao atatiatical analy•i• of thi• nature

vaa conducted, it ia ,o.•ible to •peculate that •iailar concluaiona mi&ht

apply to th• d41118ftd for aalted peanut• and caahev• by conaumera at the

retail level, in view of the inaipificant effect of marketing •rgina

between the proceaaor and retail level• (indicated in the Oklahoma reaearch

r•fers-ed tn previou1ly), in view of the atability of price• of aalted

peanut• and aalted caahewa at retaillavela (noted by the author in hia

randaa obaervationa in retail atoru from 1956 to 1961), and in·. view of

the •mall concern of conaumera about whether peanut• and their product•

are prieed.too expenaively (indicated in the 1955 conaumer aurvey, con-

ducted by the Uliited State• Department of Agriculture and referred to

previoualy herein).

In terma of th• oriainal hypoth•••• for thi• reaeare~, the tentative

concluaiona are atated aa follow•: (l) per capita conaumer inco-.s have

no atatiaticallJ demonatrable effect on demand for aalted peanuta, or for

caahev• either aa aalted nut• or in all edible forma; (2) the effect of

change• in price differential between aalted peanut• and aalted caaheva

could not be aucceaafully determined• thua, the exiatence of a competitive

or caapl-ntary relationahip between peanuta and caaheva in the aalted

nut trade could aot be eatabliahed; and (3) people tend to reduce their

per capita conaumptiou of aalted peanut• aa price of peanut• riaea, but

conaumption ia reduced at a rate much amaller than the rate of price in-

creaae, ao that riaing price more than offaeta falling conaumption, and

total aalted peanut receipt• to the induatry are increaaed, rather than

121

decreaaed; further, a aiailar aet of atatementa may be made about demand

and price relatiouhipa for aalted caahewa, and caahewa in all form. It

ia tentatively concluded that the foregoiDI atat ... nt• apply.within moclerate

raaa•• of variation in pricea and quantiti•• demanded. They may not apply

at more extr- rana•• of variation, outaide the U.mit• of obaerved data

on which thi• reaearch ia baaed. Purther, they may not apply in the event

of extr- cba1a1u in factor• u•ociated with demand.

The re•ulta of thi• analy•i• (beari1a1 in mind their limitatiou) do

not •uaae•t that the peanut induatry i• likely to be adveraely affected

by moderate price iacreuea. or by competition from caahwa in the aalted

nut trade, u a n•ult of the peanut price aupport and procluction control

proaraa.

lvaluation of 8tatiatical lleaulta

Before the tentative concluaiona atated above can be accepted aa

fully warranted, acma additional analy•••, which were not within the

acope of thi• atucly, ahould be conducted. The•• areu of inve•tigation

include:

(1) The extent to which Virainia-type lxtra Lara• peanut pric:ea and

Spaniah peanut pricea are correlated. The demand model included aalted

quantiti•• of both Spaniah and Virainia type peanut•, but only pricaa of

lxtra Lara• Virginia type. U the•• two price aerie• are not highly

correl~ted, the mocl•l• ahould be reconaiclend. ·,,

(2) The analy••• of cuhew demand relatiouhip• includad the var

year• in the periocl 1932-1959. Thia doubtleaa briD&• into play exogenoua

force• not included in the model. An analy•ia omitting the waJ year•

ahould be conaidered.

122

(3) The form of the relati01l8hip• ahould be explored graphically,

for each model COD8idered uaeful, in order to obaerve the reaidual data,

and the diaperaion of th• data about the partial reareaaion line• of

relationahip. Th••• procedure• would be helpful in determining the

relative validity of th• coefficient•, and perbapa point the way toward

improved rear•••ion moclela in caaea where no •i&nif icant reaulta were

obtained. ror auple, poatvar peanut price-quantity relatiouhipa

were aaaumd to be linear, but conaideration of aove~ut policy

cha&•• affectin& peanut price •uaa••ta that the aaaumptiou may not be

warranted.

(4) The daare• of correlation between the tvo caahev prica aerie•

ahould be aacertained. The iDConaiatent reault• obtained from th•

"320-COUut Vhol••" prica ••ri•• and the 'Taney liecea" aerie• ueeda

further atudy.

(5) Soma additional attentiou ahould be given to the degree to

which the &a•Ullptiona under leaat aquarea procedure• have been Mt,

aa apecif ied by th• Markoff Theor... The additional au&ly••• indicated

above ahould be helpful in·, thia reprd.

123

BDLIOGRAPHY

Literature Cited

A. Deecription of the World Cuhew Nut Induetry

1. Crane. H. L., Letter to the Author, Subject: Cubew Nute, (United State• Department of Agriculture, Agricultural aeeearch Service, Horticultural Cropa lleeearch Branch, Fruit and Nut Cropa Section), BeltevUle, Maryland, September S, 1956.

2. Indian Council of Agricultural lleeearch, l.eport of the Spice• lnsuiry Coamittee, (borrowed froa lmbaeey of India, Wuhinaton, D. C.), 1953, chap. 5 - Cuhewnut.

3. Journal of C~rce, New York, N. Y., 1932-1960.

4. Jordan, Curti• C., lleport on Th• Cuhew Nut Industry in South India, United State• Department of State, Coneulate at Madru, India, January 10, 1942.

5. Letter• and Interview• with a .. pouible rer•ou in the Nut lnduetry1 Conceraina Cuhewa, Peanuta 1 aad the Salted Nut Trade, (Correeponcleace by the Author), August, September, and October, 1958.

6. Hew York World•Tel,.1r .. and Sun, World Almanac, New York, N. Y., 1959, pp. 361-362.

7. United State• Bureau of the Cenaus, Poreip Ccwrce and Nav-i&ation of the United State•, U. s. Govenment Printing Office, Wuhington, D. c., 1931-1946.

8. , United State• Import• of Merchancliee for Coneumption, (Ceuua Report No. rT 110), u. s. GovemMnt Printina Office, Wuhington, D. c., 1947-1960.

9. United State• Department of Agriculture, roreip Agricultural Service, roreip .Agriculture Circular, U. S. Printing Office, Wuhington, D. C., 1953-1960.

10. , Poreip Agricultural Service, Porei&n Cropa and Marketa, u. s. Gov•~t lrinting Office, Wuhington, D. C., 1956-60.

ll. United States Department of Coaaerce, Bureau of Poreign Commerce, World Trade luformation Service lleporte - Statietice, U. S. Govel"DMDt Printina Office, Wuhington, D. C., 1954-1960.

124

12. United Stat•• Tariff Coallliaaion, ldible Tree luta, U. S. Govern-•nt Printiq Office, Waahington, D. C., leporta of 1946, 1948, 1950, 1951, 1952, 1953, and 1954.

I. Deacription of Hut luppliea, Consumption, and Pricea in the United Statea

lach of the fonaoin& reference• on oaahev au ta, and:

13. lanna, Antoine, Sidney J. Annore, and ticbard J. roote, Peanuta aad Their Uaea for food, (United Statea Department of Aari• culture. Bureau of Aaricultural lconomica, Marketina leaearch aepor: Mo. 16), U. S. Govan.eat PrintiD& Office, Wuhinaton, D. C., 19.52.

14. leatti•. J. R •• '. w. rooa' ancl I. I. BigiM' GrolfiD& Peanut•. (United ltatea Deparc..nt of qricultun, qrieultural l.eaearch Service, Parman' lulletia lo. 2063), U. 8. Coven.ant Priatina Office, Wuhinaton, D. c., 1954.

1.5. Gillilancl, c. 1., and T. I. Saith, An ADaluia of the Peanut ShelU.111 Incluatrx.a...19.50-51, Tbrouah 1952-53, (UDitecl Stat•• .. f&•tall8t~f qriculture, Aaricultural Markena Service, Karketina leaearch l.eport Ro. l~) , U. s .... Cover...nt Printiq Office, Wuh1qtoa, D. c., 1956.

16. Powell, Jul•• V. , and llicbard 8 • lerberich, l!!rketi!I Tree lut• -Tren4a ancl Proapcta, (UDitecl Statea Depart.ant of qriculture, Agricultu!'al Karketiaa lervice, Markatial l.eaea•:h laport Ro. 139), u. I. Governmant Printi191 Office, Waahinaton, D. C., 1956.

17. UDited State• Departmant of Agriculture, blricultural ltatiatica, u. 1. Government Printina Office, WuhiDgton, D. C., 1952•59.

18. , Aaricultural Marketing ••rvic•. rat• ad 011• lituation, U. I. Coven.ant PrintiDg Office, Waahiftat~, D. C., 1956-60.

19. , Aaricultural Mark•tin& Service, truit Situation, u. 8. Govermeat Printina Office, Wuhinaton, D. c., 1956-1960.

20. , qricultural Marketiaa Service, Peaaut ltocka and 1roc•Hir=t1, U. I. Goverwnt Printing Office, Wuhinaton, D. C., 1956•1960.

21 • ·, Aaricul tural Karketiq Service, Weekly Peanut l.eport, u. 8. Gove~t Printing Office, WuhiQlton, D. C., 1956-60.

22. • COlmOdity Stabilisation Service, Peanut Inforution Prepared for the 34th Annual Outlook Cont•UM•, Wuhiagtou, D. C., lkriJember 1956. .

125

23. United State• Department of Agriculture, COlllDOClity Stabilization Service, Trend9 in Peanut Production, Utilisation and Prices, 1945-1957, Washington, D. C., November 1957.

24. Weidenhamer, Margaret, Homemaker• Uae of and Opiniona About Peanut• and Tree Nuta, (United State• Department of Agriculture, Agricultural Marketina Service, Marketing lleaearch Report No. 203), U. S. Gove~nt Printing Office, Washington, D. C., 1957.

C. Analyaia of Demand for Peanuts and Cashew• in the United State•

25. Badger, Daniel D., and Jwa s. Plazico, Selected Supply and Demand lalationahipa in the Peanut Industry, (Oklahoma Agricultural lxperimant Station Processed Serie• P-33,, Stillwater, Oklahoma, 1959.

26, Poot•, Richard J,, Analytical Tools for Stuclyina DemaDCI and Price Structure•, (United State• Department of Agriculture, Agricultural Marketing Service, Agriculture Handbook No. 146), u. S. Governmnt Printing Office, Washington, D. c., 1958.

27. , Price llaaticitie• of Demand for Nondurable Goocla, with lmpha•i• on rood, (United State• Deparaa.nt of A&riculture, Agricultural Marketina Servi~e, AMS-96), Washington, D. C., March 1956.

28. Pox, ltarl A., Analyeia of Demand for Para Products, (United States Departmeat of Agriculture, Bureau of Agricultural lconomica, Technical Bulletin No. 1081), U. S. Govern• ment Printing Office, Washington, D. C., 1953.

29. Maraball, Alfred, Principle• of lconomica, Macmillan and Company, Ltd., London, Bngland, 8th Bdition, 1920, pp. 83-137.

30. O.tle, Bernard, Statistic• in lleaearch, Iowa State College Pr•••• Ame•, Iowa, 1954.

31. Penny, N. M., J. c. Purcell, and J. c. llrocl, Peanut Price and IncOllll Support Proarama, (Qeeiaia Agricultural lxperiment Station Mimeo Serie• N. s. 9), Univer•ity of Georgia Collea• of Agriculture, Athena, Georgia, 1955.

32. llojko, Anthony S., Time Serie• Analy• i• in Mllasunment of Demand, in "Agricultural lconomic• lleaearch", United State• Depari..ent of Agriculture, 11uhington, D. C., Vol. XIII, No; 2, April 1961, pp. 37-54.

126

33. Waugh, Prederick V., Graphic Analyaia in Economic lleaearch, (United State• Department of Agriculture, Agricultural Marketing Service, Agriculture Banclbook No. 84), U. S. Government Printing Office, Wuhington, D. C., 1955, pp. 26-33, 36-41.

34. Workiq, 11-r J-.-, Demand for Meat, Uuivar1ity of Chicago Pre••• Chicago, Illinois, 1954, pp. 16·26.

35. Livermore, D. UptOll, l.eaponae of Peanut rroduotion to Tech· noloaical Proareaa, Inatitutional Chana••· and Economic Conclitiona • Part II • Inatitutional Settil!I and Laaielativa Chronolo&y, (Virginia Agricultural lxperimant Station laaaarch lleport Ro. 49), Black•burg, Virginia, September 1960, pp. 44·49.

36. , lle•po¥• oi reaaut Production to Technoloaical rroar•••· Inatitutioual Chan&••· and lcouomic Conditiona • Part I • a.cant rovemant• in the Tachnolo of Peanut P uctioa, irginia Agricultural lxparimant Station llaaaarch lleport No. 48), Blackaburg, Virainia, September 1960.

The vita has been removed from the scanned document

128

APPENDICES ON DEMAND ANALYSIS

Appendix A - Economic Variables and Statistical Data Used in Demand Analysis.

Appendix B - Details of t.\lltiple Regresaion (Least Squares) Demand Equations Derived in the Analysis.

129

APPENDIX A - PART 1

Identification of Economic Variables

in Demand Equations

130

APPIHDIX A - PilT l

Idantif ication of Economic Variable• in ~d lquationa

A. Dependent Variable• (Quantitie• Demanded):

Y1 - Apparent Annual Per Capita ConaumptiOD of Salted Caahewa, U. S. (Quantity of Caahew• Salted ill U. 8.).

Y2 - Apparent Annual Per Capita Couwaption of All Cubew•, U. 8. (Quantity of Caahew• Imported to U.S.).

Y3 - Apparent Allnual Total Couumption of Salted Caabewa, u. S. (Quantity of Caahew• Salted in U.S.).

Y4 - Apparent Annual Total Conaumptiou of All Cubewa, u. s. (Quantity of Cuhew• Imported to u. I.).

Y5 - Apparent Annual Par Capita Conaumption of Salted Peanut•, u. s. (Quantity of Peauuta Salted in u. S.).

Y6 - Apparent Annual Total Couumption of Salted Peanut•, u. s. (Quantity of Peanut• Salted in U. I.).

B. Independent Variable• (ractora Influeuciq Qualltitiea Demanded)l·

x1 - Calendar Year Average Price of Caabewa (320..Count Whole lteruela, at Wholeaale, New York) Deflated by Wholeaale Price Index for rroce••ed rooda (1947-1949 • 100).

x2 - Calendar Year Average Price of Caabewa (Paucy rtecea at Whole-aale, New York) Deflated by Wholeaale Price Index. for Proc .. aed rooct• (1947-1949 • ioo).

x3 - Calendar Year Average Price of Caahew• (All Grades Combinad, r.O.B. lxportiq Countriea) Deflated by Wholeaale Price Index for Proceaaed rooda (1947-1949: 100).

x4 - Calendar Year Averaae Price of Ca•hew• (320-COunt Whole lternela, at Wholeaale, New York).

x5 - Calendar Year Average Price of Cuhewa (Janey Piece• at Whola-aale, Hew York).

x6 - Calendar Year Average Price of Caahewa (All Cradea Combined, r.O.B. lxporting Countriaa).

131

x7 - Calendar Year Average Price of Peanut• (Virginia-type, lxtra Large lternel•, r,O.B. U. S. Shelling Point•) Deflated by Whole•ale Price Index for Proc•••ed rood• (1947-1949 • 100).

x8 - Calendar Year Average Price of Peanut• (Virginia-type, lxtra Large Xenwl•, 1,0.B. U.S. Shelling Point•).

x9 - Per Capita Diapoaabl• Peraoual Income, U. 8., Deflated by Conaumer Price Index (1947-1949 • 100).

x10 - Total Di•poaable Per•oual Income, U.S. (Annual late).

X11 - Wholeaale Price Index f•r Proce•••d Pooda, U. 8. (1947-1949 • 100).

X12 - u. I. Population.

X13 ~ Time Tranel.

132

APPENDIX A - PART 2

Statistical Data Used in Demand Analysis

Table A - Deflated Annual Per Capita Data, 1932-1959 (basis of equations la-3f and 7a-7b).

Table B - Raw Annual Data, 1932-1959 (basis of equations 4a-6f and Sa-Sb).

Note 1. See Part 1 of this Appendix A for complete identification of variables in these tables, in accord-ance with •Y" and "X" designations at the heads of the data colums.

Table A. Per Capita Consumption of Salted Cashews (~1 ), All Cashews (y2 ), and Salted Peanuts (y5)J Deflated Prices of Cashews (xt)' (x2 , and (x3 ); Deflated Price of Peanuts (x7); Deflated Disposable Personal ·ncome (x9 ); and Time Trend (x13 ). United States. Annual Data, 1932-1959.

y jJ yY yY xY xii x 21 xii xii I I I I I I I I I x I 1 I 2 • 5 I 1 I 2 I 3 I 7 I 9 I 13

Y11£ • 'l2sal ! 'l~&1l ! 'l~&1l I 'illQ1l 1 'il121l ! (ill~al I (iLJ.~.l I I I fa::!i£!il I

1932 o.059 o.069 11 78.90 38.33 44.4 10.88 667.73 l 1933 0.085 0.100 11 65.29 44.10 35.3 11.96 657 .12 2 1934 0.100 0.118 11 61.22 39.51 37.1 17.23 718.58 3 1935 o.149 0.176 11 51.73 33.30 31.5 17.18 779.43 4 1936 0.147 0.172 11 52.79 39.00 33.5 15.95 870.51 5 1937 0.151 0.177 11 52.92 36.66 29.2 15.38 896.12 6 1938 0.144 0.170 11 53.05 32.65 29.6 16.12 838.46 7 1939 0.191 0.225 11 53.35 35.45 31.6 18.38 904.58 a 1940 0.186 0.219 11 50.48 43.46 32.3 18.17 961.39 9 • 1941 0.227 0.267 11 58.14 50.97 31.9 18.75 1,108.70 10 ,,J

w 1942 0.120 0.131 y 90.58 56.60 37.2 23.47 1,249.81 11 1943 0.024 0.026 11 161.75 116.85 51.l 26.67 1,319.68 12 1944 0.105 0.114 1.608 155.96 114.19 95.4 26.90 1,410.40 13 1945 0.161 0.175 1.652 158.36 98.68 110.2 26.73 1,398.14 14 1946 0.194 0.211 1.199 93.67 56.88 71.4 22.62 1,350.07 15 1947 0.190 0.208 0.850 54.89 38.11 40.3 22.53 1,228.31 16 1948 0.211 0.237 0.832 51.71 30.49 35.7 19.85 1,244.88 17 1949 0.225 0.246 o.798 57.36 28.21 39.8 23.24 1,239.28 18 1950 0.293 o.320 0.779 46.41 35.65 32.3 28.29 1,321.69 19 1951 0.293 o.327 0.899 49.17 37.55 35.5 21.08 1,319.30 20 1952 0.240 0.268 0.905 58.13 38.40 42.2 21.56 1,333.12 21 1953 0.268 0.299 0.940 50.98 39.93 40.3 23.12 1,370.30 22 1954 0.312 0.348 0.911_ ___ -· _42..._08 31. 3Q __ - - 31._0 - ·- 2..4 .32 _ _______L._3_65_tl5 __ . - 23 . --

Table A. (Continued)

' y v--. y 21 ' y 9 I x F s x g ' x 'O I x ~ I x y I x I 1 I 2 I 5 I 1 I 2 I 3 I 7 I 9 I 13

Year 1 (lbs,) a (lbs,) • (lbs.) 1 Ct/lb.) 1 Ct/lb.) a Ct/lb.) 1 Ct/lb.) 1 S 1 (years)

1955 0.360 0.402 0.867 52.06 38,01 34,6 28.72 1,427.71 24 1956 0,300 0,335 0.901 54.82 49,76 42,0 32.03 1,469.68 25 1957 0,306 0,341 0.988 54,64 41.39 39.5 20.82 1,496.50 26 1958 0.344 0.384 0,994 46.85 30.02 34.3 21.61 1,472.14 27 1959 0.320 0.358 1.054 48.48 33.95 36_.4 __ .. 2l.Jl2 _l .. _516._09_ _ __ _2B

j/ Sources Estimated quantities of cashews salted in United States are based on percentages of quantities of cashews imported to United States. These percentages are based on per-centages determined in surveys of nut industry sources by the United States Tariff Commis-sion for periods as followsa 1935-1937, 85% of all cashews estimated to be salted, 1946-1949 (average of years beginning October 1), 91.67% of all cashews estimated to be salted; 1950-1952 (average of years beginning October 1), 89,583% of all cashews estimated to be salted. A& of June 1960, no further such information on cashews had been collected by the Tariff Commission for periods since 1953, However, the Commission's staff stated in ~une 1960 that the average percentage of cashews being salted is believed to have undergone little change since 1953. Based upon the percentages found in surveys, the following per-centages have been used in this study to estimate the number of cashews being salteda 1932-1941, 85%; 1942-1946, 90.625%; 1947-1950, 91.67%; 1951-1953, 89.583%; 1954-1959, 90.625%.

'4/ Sources 1931-1946, "foreign Commerce and Navigation of the u. S,," United States Bureau of the CensusJ 1947-1956, "Imports for Consumption of Merchandise," Report FT 110, United States Bureau of the Census1 1957-1959, •foreign Agricultural Trade of the u. s.," United States Department of Agriculture. These quantities of cashews imported to the United States are "General Imports" data for 1932, 1933, and 1947, and "Imports for Consumption" da+.a for all other years. Price data represent unit value f .O.B. exporting country.

~ Sources Crop Reporting Board, United States Department of Agriculture.

.... ~

Table A (Continued)

y

~

§/

y'

Sources Wholesale Price Quotations in "Journal of ColllDerce," New York, N. Y. Prices used for "320-count Whole" cashews were reported as such in the "Journal" beginning with June 1943. Prior to that time, only a price on "Whole" cashews was reported. Prices used for "fancy Pieces" were reported as such starting with March 1939. Before that time, only a series on "Standard Pieces" was reported. lhese prices are market quotations, and not actual sales prices. Such quotations often remain unchanged for several months at a time, and do not necessarily reflect short-time changes in the cashew market. lhe price quota-tions are F.O.B. New York, at importers' warehouses, with all import duties and shipping charges paid. lhey are made by importers to nut salters. Sources "Peanut Market News," United States Department of Agriculture. Prices used for Virginia-type Extra Large Shelled Peanuts are simple averages of high, low, and "mostly" prices reported by shellers, cleaners, and brokers. Basis is f .O.B. important shipping sections (shelling points) for Virginia-type peanuts. These are prices charged to nut salters. Sources "Business Statistics" and "Survey of Current Business," United States Department of Commerce. Data not available prior to 1944.

.... w "'

136

Table B. Total Conauaptio11 of Salted Ca•beva <T_e, ill Caebews {y4), and Salted Peanuta (76)J Prioea ot Cu ws (XJ.) 1 (x5), and

(x6)J Price ot Peanuts (xs)J Disposable Peraonal Income (x1o)J Wholesale Price Index tor Prooe•aed

Food8 (xt1)J Populatio11 (x12); aad Tiu Trend x13). United States Annual

Data, 1932-1959

ii ii iJ I I I ]/ I a 73 I 74 I 76 I :x4

le&f I c1000 ua•.> I (lQQQ lb1.) I ( J,QOS> lba • ) I (q/l.b.)

1932 7,330 8,62) f 28.80 1933 10,641 12,526 2).70 1934 12,664 14,899 ~ 26.08 193S 19,020 22,376 26.95 193~ 18,781 22,102 ~ 26.45 1937 ~-9,J>2l 26,848 23.75 1938 18,759 26,069 ~ 24.19 1939 25,046 29,466 23.10 1940 24,599 28,940 f 22.01 1941 30,253 35,592 29.36 1942 16,244 17,'121 ~ 53.53 1943 3,247 .3,542 99.64 1944 14,467 15,m 222,562 94.20 1945 22,460 24,502 231,172 96.28 1946 2'1,40'7 29,898 169,554 72.69 1947 27,410 29,902 123,966 53.90 1948 31,819 34,712 121,937 54.86 1949 33,S96 .36,650 119,07) 54.89 1950 44,442 48,482 118,160 46,32 1951 45,243 50,504 138,806 54.78 1952 'J?,688 42,071 142,0.34 63.24 1953 42,739 4'1,709 150,101 53.32 1954 50,660 56,551 148,986 44 • .31 1955 59,480 66,.396 14.3,255 52.94 1956 50,416 56,2'79 151,49.3 S§.5'1 195'1 52,.313 58,396 169,122 57.70 1958 59,815 66,771 17.3,121 ;2.00 1959 56,752 63,)51 186,652 51.87

137

Table B. (Continued)

IX~ I xJ/ I xJ/ I xl(j}/ I xuY I x12Y I X13 I I I I I I I

Year1(4/lb.)1(4/1b.)1(j/lb.)1($ bil.)a(l947-49=100)a(mil. persens)a(years)

1932 13.99 1933 16.0l 1934 16.85 1935 17.35 1936 19.54 1937 19.21 1938 14~89 1939 15.35 1940 18.95 1941 25.74 1942 33.45 1943 71.98 1944 68.97 1945 60 ... 00 1946 44·.14 1947 37.42 1948 32.35 1949 xr.oo 1950· 35.58 1951 41.83 1952 41.78 1953 41.77 1954 32.96 1955 38.66 1956 50.61 1957 43.71 1958 33.32 1959 36.33

16.2 12.8 15.8 16.4 16.8 15.3 13.5 13.7 14.l 16.5 22.0 31.5 57.6 67.0 55.4 39.6 37.9 38.l 32.2 39.6 45.9 42.2 32.6 35.2 42.7 41.7 38.l 38.9

3.97 4.34 7.34 8.95 7.99 8.06 7.35 7.96 7.92 9.47

13.87 l(>.43 16.25 16.25 17.55 22.12 21.06 22.24 28.23 23.48 23.46 2B.1e 25.61 29.21 32.57 21.99 23.99 22.57

48.7 45.7 52.0 58.3 66.2 71.0 65.7 70.4 76.l 93.0

117.5 133.5 146.8 l~.4 159.2 169.0 187.6 188.2 206.1 226.l 237 .• 4 250.2 254.5 270.2 287.2

.307.9 316.5 334.6

36.5 36.3 42.6 52.1 50.l 52.4 45.6 43.3 43.6 50.5 59.l 61.6 60.4 60.8 77.6 98.2

106.l 95.7 99.8

111.4 108.8 104.6 105.3 101.7 101.7 105.6 111.0 107.0

124.9 125.7 126.5 127.4 128.2 129.0 130.0 131.0 132.l 133.4 134.9 136.7 138.4 139.9 141.4 144.l 146.6 149.2 151.7 154.4 157.0 159.6 162.4 165.3 168.2 171.2 174.l 177.1

1 2 3 4 5 6 7 8 9

10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

'J,/ Sources Estimated quantities of cashews salted in United States are based on percentages of quantities of cashews imported to United S;tates. These percent.ages are based on percentages determined·in surveys of nut industry sources·by the United States Tariff Cennission fer periods as followsa 193!-1937,, 85% of· all cashews estimated to be salteda 1946-1949 (average of. years begiMing Octeber 1), 91~67% of au·cashews es-timated to be saLt•dJ 1950-1952 (average of ye~rs beginning October 1) 89.583% of all c.sti.ws estimated to be salted .• As of June 1960, no fur-ther such inf•rmation on cashews had been collected by the Tariff Cemmission for· periods since 1953. However, the Commission's staff stated in June 1960 that the average percentage of cashews bein~ salted is believed t• have undergone little change since 1953. Based upon the percentages found in surveys, the follewing percentages have been used in this study to estimate the number of cashews being salted• 1932-1941, 85%1 1942·1946, 90.625%1 1947-1950, 91.67%;. 1951..;1953, 89.583%; 1954-1959, 90.625%.

138

Table B (Continued) ';,/ Sources 1931-1946, "Foreign Commerce and Navigation of the u. s.,"

United States Bureau of the Census; 1947-1956, "Imports for Con-sumption of Merchandise," Report FT 110, United States Bureau of the CensUSJ 1957-1959, "Foreign Agricultural Trade of the U. S.," United States Department of Agriculture. lbese quantities of cashews imported to the United States are "General Imports" data for 1932, 1933, and 1947, and "Imports for Consumption" data for all other years. Price data represent unit value F.O.B. exporting country.

~ Source• Crop Reporting Board, United States Department of Agri-culture.

~ Source• Wholesale Price Quotations in "Journal of Commerce," New York, N. Y. Prices used for "320-count Whole" cashews were reported as such in the "Journal" beginning with June 1943. Prior to that time, only a price on "whole" cashews was reported. Prices used for "Fancy Pieces" were reported as such starting with March 1939. Before that time, only a series on "Standard Pieces" was reported. lbese prices are market quotations, and not actual sales prices. Such quotations often remain unchanged for several months at a time, and do not necessarily reflect short-time changes in the cashew market. lbe price quotations are F.O.B. New York, at importers' warehouses, with all import duties and shipping charges paid. lbey are made by importers to nut salters. '!JI Sourcea "Peanut Market News," United States Department of Agriculture. Prices used for Virginia-type Extra Large Shelled Peanuts are simple averages of high, low, and "mostly" prices reported by shellers, cleaners, and brokers. Baais is F.O.B. important shipping sections (shelling points) for Virginia-type peanuts. lbese are prices charged to nut salters.

f}/ Source1 "Business Statistics" and "Survey of Current Business," United States Department of Conmerce.

]./ Data not available prior to 1944.

139

Ar11NDIX B

Detail• of l*altiple a.areaaion (Luat Square•) Demand lquatiou

Derived in the Analy•i•

Section l. Caahw• lquatiou a. Table• 1-6 (lquatiou la through 6f .)

Section 2. Peanuta lquatiou a. Table• 7·8 (lquationa 7a throuah Sb)

140

sacne11 1 • CASlllWS SQUAnca

i~:t ll~:1 ..: . . . .. yOO <l00

r it1 111 'd'd • ,, .. : JI UJ UJ

• • •

it! • ,,., . HJ .......................................................

~11 ~~ ~f i • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • i~~ ~~~ ~~~

............................ M.•U .. •M•ff•• .. M••--

...... I 1tl!t 1il!J 1111! ......

. . Hiii 11111 '~ ·1 ..

MM MMMffffMffffM"~""""-MMMHMffffff

• ....

I J A ~ ~

j_z.; 2 142

8~~ b5\9 \~~ • • • • • •

r '1°1 flOO «lO<? • • • • •• • • •

it~ • • • • • •

IU II! • • • JI .,., . .. ,. . ,, ... HJ HI HJ .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. ~ ...............

I !!l 11& !f! • • • .. 1 ooi • • . .. • • • • • • • •

I • • • • •• • • • • • • • • • • • • • • • • • • ,; .. ..... ...... • • ... .. .. .. .. .. .. .. .. .. .. .. .............. .. .. .. ... .. .. .. ,. I~~!! , ,~t!lil l' r: •.3!~ i"Ofl'\ ......

h 1!JJI 1JJ!I ·J!I! .......

I ltnJ ~n11 !lib .. " ..

I p I~~ I~~~ l~~d .. ,. .. .. rA' ~ II ....... .. .. .. .. " ...... .. ...... u ...... .. ... .. .. .. -....

• ....

I

·. ·. -",.'

43

~~ 'It~~ All~

I; ,0 .... Cf Or4 1d ... ... • • • • • • ••• ......

ill it~ ••• I! J IU ,,I • • • r ,,. . ,. " . ,. ...

HJ HJ HJ 1! .. .. .. .............. .. .............. .. .. .. .. .. .. .. i1'. .... ,,, if l ...... ag

~1· 0 ~ OOM 001\ • • • • • • • • • • • • • •• • • • • • • • • • • • • • • • • •• • • • • • • • •• J, ....... ....... ... ...

al .. .. -................ ............... .. .. .. .... --es. I~~~ :~~i' 1j!!! ~I 0 ... MO ......

Ji J, 1HI! :ftlt ,ffll 0000 0000 ......

dth Cl,000 !hl1 1!11! I; I-

8.t~.,.; 6.t~~ l.tlt.nil

l'i .. .. .. ....... ...,. ~ ,1. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. . .............

.;

I I

' . . ··' 144

"' St ::I t ~ '! t 'A fJ • • • • • • • • • <? 0 .... ' 0 ... ' 0 ... ~j • • • • • • • • • • • • • • • • • •

i I I • I I • I I • • • • • • • • • • • • • • • • • • • • • •

" " • " " • ,. ,, • JI J J J I I I I I I .. .. .. ................. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

I ~ ' ' I It I J ' • 0 • o o A ~ • I ~ • I • • • • • • • • • • • I • • • • • • • • • • • • • • • • • • • • • • • • ,; • • ,. • .. "' • .. • ..

.. .. .. ................. .. ........ -.. .. .. .. .. .. .. .. .. ,. : tt &.Ii :} 1=!~~, '~~!~ ,.. Of fl'tO OOilt\I ......

h :llii :'Ht ·HJ! • • • • 0000 0000 ......

l (lt1t ~hlJ t!f 1! ,0 q4ooo ,,00 ...... • I~

8:\t~ ltf'.r-N I~~~

I .. •• .. ., .,,. ... ~ ...... .. .. .. .. .. .. .. .. .. .............. .. .. .... .. .. .. .. • Oil

I

--J~ u i! •...:: •E ~1 J, al ~I JE

145

GI ~ q ' 0 0

~~1' ~'al~ Cl

0 0 ' d 0 • • • I .. 0 • • .•

i i ! i t ! r i t ! .. ' . ., .. : .. .. :

JI I I J I I J I I J

i t ~ ~ ' \ ~ ' ~ d 0 9 0 0 ~ 0 0 ; • • • • • • • • • • • • • • •

I . . . . . . . . . • • • • • • • • • • • • • • • • • • ... . ... ... . ... .. .... .... I ::t'~afR

t e""\ • • V\WOO l l1~fl uf. •• ~ 00 ......

......

'~I . '''o' . ~11 ! l.t.t-~

...

,J~ ----~-------~-------~------• "" I

.:_~

~'4~ ~~~ ~;'~ fl 0 0 fl 0 OI "f o -I; . . . . . . . . . I i t 1 i t ~ i t ~

,. .. : .. 'I : .. ,. :

)t I I J I I I I I J "~"-""""""""""""u" "•""""""

1~~1 ~~~ ~'~ • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • • ,. . ... .. . .. ,. ... .. ... .. h 1!111 1H1! 1Ht1 ......

I ~11!! J11~ ,!J~

I I-':!m ~"na ~ttd .I' ~ II

141

!t ~ 8 • • • ' 0 0 I 0 • • •

r 1 t i ' ., . )• I I J

I ~ ~ • ; ~ & I? . ~ . • • • • • • ... . .. .. .. ..

.. .. ..

l "' ~ . ~ ; ' 0 . . . .. . . t t ~ I t l • • ., ,. • ,. 'I •

I I I I I J

! r: ! . J • • • • • • • • ,. " .. ~ !1 • ~ f It • • • • • • • • ,. ...

I~ ~if~;f;a ~~11am

~ _, ..

I • "" I

I ~ s 1 . . ~ ... 0 0 .,

i' i t ~ I ,. ,, =

JI I I i

.. ..

.. ..

' ti ' Q B' • II\ • • • • • • • • • ,. ...

148

• • •

i t ~ • ' ., : I I J l ~ l d • ' . J . • • • • • • • • ... . ..

'A ~ A • • ' 1 • • •

l t ~ • " ., : I I J

~ i ~ • • • • • • • • ......

I ~ ~..,Nm ~n~ll ~~» ~ .r ,,

J

•

• • • • • • • • •

t t ~ i t l • • ' 'I • ' ,, •

I I J I I I 1~ - ----------------- ---------.. 1 11 ~ i ~ ~ l ~ ~ i ~ I . . . . . . . . . • 1 . . . ..~ . . ,. . . .... ,. . ... . . .. . .. ~ .... """"""" --·-"""" .......... .. -J I. a .... y h 1 Ili~iU ~ ••' I

• U\

I

, ltMUi·"R •000040

I jiiiii I iimt i.ii~u 1'iiijf l. '

150

~ ~ ~ s J ~ el ~ ':9 • • • • • •

r ' 0

0 0 '? 0 0 ' I t I • • • • • • • • • • • •

I I • I I • • • • • • • • • • • • • • • • JI ~ .. . . ,, ' . ~ ., . J I J I J J I J J ..... .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

' ~ ~ ~ ~ ~ ~ SJ II ~ e ~ ~ I ~ 0 " • : t ~ • • • • • • • • • • • • • • • • • • • • • • • • ... • ... ,. .... ,. • ... . .. .. .. .. .. .. .. .. .. .. .. .. ............... .. ................ ,~,!~~~ : ~~~"4~~

00 000 : ~.I ~-S.~1 000000 ..

I 1HUJJ ~Fi~~ : tll~i !!(If 11 l!'f ~ lifJ;f ....

~~~Ill li~m&f~ i~;~ti "(. ·I ~t- ilij v.l .., -' ~ __ , •

I I n,1~g • Vtt .. ~ .l\tta~» •• .. .. .,, ...r' ti .. .. .. .. .... .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. ..

·• "' j

~ '~ r I I I r iii

.I~ l 0 • :i : I . • • • • • • ... . .. :~~'!" ....

I ¢YJ1g; 'Ii J i .... tmm

A ~ ....

·'151

l~~'~!~

11iu:; ~~

~~"~~ !'ll~ ~ .

I • 1;r:tNM IJtll;y; .. .. .. ,f' _, .. .. .. .. .. .. .. .. .. .. .................... '8

1!!!~~

1:ua;i ,;;~

Uml~ ~ 1"'

..NWJ\i\1'; ..

.r' .. .... " ..........

1-52

~ tt !! I $ ~ ~ $' ~

I .. 9 0 0 4 d 0 ' 0 0 • • • • • • • • •

f t ~ f t • i t •

I • • • • • • • • • • • • • • • • • J1 'I ., : .. ., . ,. " . I I J I I J I I I .. .. .. ........ " ........ .. .. .. .. .. .. .. .. .. .. .. .... .. .. .. .. .. ! r: l ! Ii ' f II ! . ! . t ::i : ~ . : .- . • • • . "" • . "" . • • • • • • • • • • • • .. . . "' .& .. ... " .. . ..

.. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .. .... ..... .. .... ,. :~~!=J~ll

.. I ~fl.~ Gtft'4 l~~ftj'! co ... 0 cl ..;.1. 000 ..tllO 0 ......

I ~l}q'~~ :UJlta ... , J•41~1· I !ff I

'°" n~~ ,j f!R~

...... jp~; 'i;q1 1i111:~ r~ ~ Ii .ft! I .t ci"1 A iot

I I- 1.r~~ A°lr~N;; AtW:fa; .. .. .. " ti" ..,

.. .. - .............. .... .. .. .. .. .. .. .. ................ "' I

Table 7. P•r Capita CollllU11ptioa of Saltecl reanuca (Y 5) aa a Function of Def lated Price of Peanuta (X7); Deflated l'ricu of C..heva (X1) and (X2); ?er Capita X..... (X9); and Time (X13) • 1947-1959.

• • • : 'fariablu : : St&Ddarcl :

2 : : 'Oeaend elaaticitiea

Squa~ion_t J)ei_. _: _IJad. __ : b-valuea_ __:_ enqr : __ t ·- : C>theer __ val._uea : with reapect to: . . a2 ••••• o.893 7a . Y5 . bo 0.487 -- -- . . Price of peanut•... -o. 2 i' . . . .

14.46** X7 -0.0104 0.00273 . . X1 0.900039 0.00207 o.oo : I ••••• 0.03150 . Price of caahewa •• 0.002 . :19 0.000327 0.00052 0.40 . . ** x.13 0.00965 0.01334 0.52 . p ••••• 16 .--73 : I~ •••• •.•••••• 0.50 .

• . . • . . 2 .~ ,, 7b . Y5 bo 1.093 -- -- . •••••• 0.938 . Price of peanut• •• -0.32· . . ** . .

x .. -0.0121 0.00221 30.27 . . . . 2 u.00468· 0.00196 S.68* . s ..... 0.02408 : Price of caahew• •• 0 .19~·, .

0.000533 0.00053 1..01 : 9 ** :113 0.0299 0.01304 : 5.28 . p ••••• 29.31 : Inc,~ •••••••••••• 0.81 . . .

:

..... ~ .

Table 8. Conaumption of Salted Peanuts (Y<J. aa a Fuoctioll of Price of PealauU (X8); Price• of Caahew• (X ) (X5); I~ CXio>; Price Index (Xu); Population (X12); and ru. (X13). 194 7·1959. 4

. Yariabl•• . : Stanclard . . . Demand elaaticitiaa . . . t2

. . Kguation : hi!· : IDd. : b-valuea . error . • Other value• . with re•2!ct to: . • • .

: . : . 8a . y6 bo -50,646.00 .,._ ,.~ .. . a.2 ••••• 0.569 : Price of peanut• •• -0.27 . .

X3 -1,354.55 658.38 4.23 X4 -143.63 393.05 0.13 . s .. 5,419.43 : Pr ice of caahew• • • -o . 06 . X10 537.82 591.55 0.83 . .

** Xu 97.98 561.64 0.03 . F ••••• 30.83 : Incmm •••••••••••• 0.91 . X12 1,333.17 6, 743.36 0.04 X13 -5,481.79 16,020.81 0.12 . . . . . . . .....

• \.I'' 2 t .• "" 8b . y6 l>o .. 79)t308~31 -- -- . ll ••••• 0.977 : Price of peanut• •• -0.43-.

a.04* .

~ -2,127 .16 750.14 . . . .

703.22 443.99 2.Sl . s .. 4,601.27 : Pri~ of caahew• •• 0.21 . X10 -412.80 732.14 o.43 . .

** Xll 446.36 506.51 o. 78- . . F ••••• 43.15 : lac .............. -o .82 . x12 7,848.18 6,682.0l l.38 X13 -9,929.48 13,823.00 0.52 . . . . .

' .

ABSTRACT

Thi• atudy concerna the competitive poaition of peanut• and caahewa

in the aalted nut trade of the United Stat••· The effect of the price

aupport and production control proaram for peanut• i• evaluated in reaard

to the demand and price relationahipa between aalted peanut• and caahewa.

Thi• reaearch analyse• , ... nd and price relationahipa for aalted peanuta

and caahewa, compile• t1a• available information on the world caahew nut

induatry, which baa not heretofore been readily available to the public,

and 8\llml&rizes relevant information about the United State• nut trade in

terma of auppliea, conaumption, and price• of peanuta and tr•• nut• with

emphaai• on the aalted nut trade.

The reault• of thi• reaearch, in ita preaent •taa•, do not augge•t

coaclU8ively that aalted peanut conaumption i• likely to be affected in

a manner detrimental to the peanut iadU8try, in the foreaeeable future,

by moderate price iacreaa .. , or by competition from caahew nuta, u a

reault of the peanut price aupport and production control program. How-

ever, a aubatantial expanaioa of world caahev production haa occurred in

the recent put. Proapecta for further expanaion appear bright in view

of the encouraa ... at currently provided by India'• plana for total ec-

onomic arowth. African produ~tion baa alao clemonatrated capability of

aubatantial expauioa. Accordiqly, a further increue in caahev import•

by the United Stat•• miaht r~~son&~ly be expected.

AN ANALYSIS OF DEMAND AND PRICE RELATICNSHIPS … · 2020-01-22 · AN ANALYSIS OF DEMAND AND PRICE...

Documents

Transcript of AN ANALYSIS OF DEMAND AND PRICE RELATICNSHIPS … · 2020-01-22 · AN ANALYSIS OF DEMAND AND PRICE...