WASHINGTON, D.C. - Food industry charges for handling, processing, and retailing food products rose substantially in the 1961 first quarter, according to' USDA economists. The fann-to-retail price spread, a measure of these charges, rose to 4.6 percent from the previous quarter, accounting for all of the 1.9-percent increase in the retail cost of the market basket, a fixed quantity of domestically produced farm foods. The fann-to-retail price spread is expected to rise during each remaining quarter of 1981, although the gains will likely be much smaller than in the first quarter. This forecast anticipates that increases in the farm value of foods will make it more difficult for the food industry to raise " margins and that marketing cost increases will moderate. For all of 1901, the farm-to-retail price spread for the market basket may average 11 to 12 percent above 1960-much higher than last PUT SOME PLEASURE BACK INTO MANURE HANDLING WITH THESE THREE TOUGH-BUILT MACHINES FROM US FARM SIMPLICITY TANKER WITH FEW MOVING PARTS—► With so few moving parts, you know immediately this tanker will be easy to maintain. A fan on the bottom front of the unit, draws in the liquid slurry by gravity and blows the manure up over the tank through a rugged pipe. As the liquid manure is discharged out the back, a special baffle deflects the slurry into a nice spreading pattern onto the fields. Available in a capacity size to fit your farm. So put some pleasure back into your manure handling with these three tough-built machines from US Farm Systems of Pennsylvania Fill in this coupon and mail it to: ■ 1C FARM I IN SYSTEMS of Pvnmylvania Veurleugh Burtt Red Bedd«f Cheep* OislMKHer Food-industry charges on r ’sß.4-percentrise. Ibis increase mainly reflects the ' —ge increase in the price rising costs of the food industry, » the first quarter including wages and benefits of '"dine in farm workers and prices of many inputs '•* decline, bought by food processors and 'nges retailers from the nonfarm economy. year’s 8.4-percent rise. The large increase in the price spread (hiring the first quarter accompanied a decline in farm value. Once farm prices decline, there is a lag before the changes are reflected in retail prices; therefore, the farm-to-retail price spread widens in periods of declining farm prices. Moreover, the pricing policies of food retailers and manufacturers may permit margins to widen during short-term declines in farm prices. Similarly, the farm-to retail spread may narrow tem porarily when farm prices rise sharply, which is what happened during the third quarter of 1900. This pricing policy minimizes food price changes and, thus, consumer reaction to prices. These price adjustments generally take place around a steady upward trend in the costs of food marketing. The first-quarter price spread for the market basket was 10.7 percent larger than a year earlier. 4020 Blue Ball Road, Nottingham, PA 19362 Or Phone: (301)398-2948 The marketing cost index, measuring price changes for in puts used in food processing and distribution, averaged nearly 12.5 percent higher than a year ago in the first quarter. Prices of marketing inputs which include a broad range of goods and services, have closely followed those in the general economy. Prices of food marketing inputs are expected to rise further during 1961 because of continued inflation throughout the economy. Food industry workers are likely to seek higher wage increases to offset inflation. The. union representing food retailing employees believes that wage demands in 1961 will approach 10 percent or slightly more compared with the average BULL-STRONG -4 MANURE PUMP You may never see another manure pump with so much brute strength built into it. A 24” propeller provides agitation that farmers are now saying stirs up the slurry in two hours in stead of twelve. A self-clearmg knife on the propeller chops solids in the pit. A 6” fill pipe from a 20” impeller lets you load the tanker in a hurry. Available in models from lagoon, trailer, 3 pt. hitch or stationary applications. TOUGH-BUILT ■W RED BEDDING CHOPPER This practical machine fluffs bales of straw, corn fodder and old hay into liquid obsorbent bedding that leaves no more long stems to clog your liquid manure system. Designed for the modern dairy farm, you have three models to choose electric, gasoline or battery powered motors. i 1 j Please send me information on I I □ Tough-built, red bedding chopper I j □ Bull-strong manure pumps ! | □ Simplicity tanker with few moving parts I I NAME I ADDRESS | TOWN I Phone i I Harm I Hogs Cows Steers Chickens wage settlement of about 9 percent last year. However, wage bargaining in food retailing will be com paratively light this year, with about 200,000 workers covered by 32 major agreements, involved. Much of this year's wage increase will stem from, wage increases under old contracts from the cost of living adjustments tied to the Consumer Price Index. Although food industry costs are rising, profit margins in 1961 are expected to average near the 1960 level and the average for the last 3 years. According to data compiled by the Federal Trade Commission, food retailers’ after-tax profits in 1980 averaged 0,9 percent of sales .STATE acres and have Lancaster Fanning, Saturday, May 30,1901—A15 nse and 13.7 percent of stockholders’ equity, compared with 1.7 and 13.3 percent, respectively for all retailers. Food manufacturers’ after-tax profits averaged 3.4 percent of sales and 14.7 percent of stockholders’ equity, compared with 4.9 and 14.0 percent for all manufacturers. Food industry profit margins had declined in the second and third quarters of 1900 because of the recession, but they improved substantially in the fourth quarter as food store sales rose seasonally and farm prices leveled off First-quarter profit margins probably declined seasonally from the fourth quarter of 1960, but likely equaled or slightly exceeded a year earlier—reflecting the weakness in farm product prices. PEBUUBJOTERIES IBM For car or truck, also heavy duty batteries lor diesei engines. m Less $4.00 trade-in BALER TWINE Clover 9,0000 r 10,000 ft. $21.50 down to $21.00 in quantity. Marion twine 10,000 $20.40 down to $19.90 in quantity. I will deliver in Lane. Co. for 10* a bale in 50 bale lots. Set of 3 gang used mowers, 21 in. each with a 60 in. total cut. Yardman as good as new New Yardman Push Mowers 18 in. cut $112.95 JONAS Z. LAPP R.D.2,80x276 Myerstown. PA 17067 LANCASTER FARMING FOR COMPLETE AND UP-TO-DATE MARKET REPORTS
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