Transporting, Handling, and Storing Seeds

LEO E. HOLMAN AND JAMES R. SNITZLER.

FARMERS plant alfalfa seed from California, ryegrass seed from Oregon, whiteclover seed from Idaho, redtop seed from Illinois or Missouri, Sudan-grass seed from Texas, tall fescue seed from Kentucky, and orchardgrass seed from Virginia.

The seed is transported from the place of production to the place of planting by railroads, trucks, and ships. The primary users of these facilities are middlemen, who assemble, process (the seed industry calls it conditioning), store, and ship the seed to large-scale growers or to other middlemen, who sell it to those who plant it.

More than 3 million tons of seeds were transported from producer to user in 1959. That tonnage would fill about 200 thousand tractor-trailers or 100 thousand rail cars.

That fact brings out an interesting point.

THE TONNAGE of seeds is substantial, but it is small compared to the total tonnage of agricultural products that the carriers haul. It was only 2.6 percent of the tonnage of agricultural products hauled by the railroads and about 1 percent of the combined tonnage of agricultural products hauled by the three major types of carriers.

The small percentage that seed bears to total agricultural tonnage belies its importance to the carriers and to the Nation's economy. Our entire agricultural production depends on the delivery of seed to the right place, at the right time, and in the right condition., The tonnage of seeds thus is a generator for the total tonnage of our agricultural products. Domestic-grown seed sold off farms was 94 percent of the total seed hauled in this country in 1959. The rest was imported.

Wheat, corn, rye, oats, rice, sorghums, barley, and buckwheat made up 41 percent of the total tonnage.

Vegetable seeds and potatoes were next in importance; 29 percent. Field seeds (principally grasses and legumes) and oilseeds (soybeans, peanuts, and flax) each accounted for about 14 percent. A miscellaneous group consisting of seeds of cotton, tobacco, flowers (imported), trees, and shrubs made up the remaining 2 percent.

ALL MODES of transport are used in hauling seeds. The railroads, the predominant carriers, hauled 1.8 million tons, or 60 percent of the total. These rail and truck percentages represent primarily the long-haul movement of seeds that is, from the country assembly points through the various wholesale trade channels to the retail stores. The short-haul movement, from the farm to the country assembly point and from the retail outlet to the farm, is nearly all by truck.

The long-haul movement of seeds also involved the use of boats and airplanes, but the combined tonnage hauled by them probably did not exceed 3 percent in 1959.

Most of the tonnage carried in barges and lake and coast-wise freighters consisted of grass and legume seeds grown in Oregon and shipped through the port of Portland to destinations on the gulf and Atlantic coasts.

Seed shipped by air is primarily experimental and high-value seed for which the buyer is willing to pay the higher cost of this premium service.

Parcel post is used extensively for small shipments of vegetable and flower seeds, but it utilizes one or more of the types of carriers previously mentioned mainly rail and truck.

Privately owned and for-hire trucks are used to transport seeds.

Private trucks do most of the short-haul shipments. They are owned or leased by producers and wholesale buyers, who haul the seeds from the farm to the country assembly point for reshipment; farmers, who purchase the seed from the local retail seed dealers and haul it to their farms; and retail dealers, who provide delivery service to the farm.

The truck share of the long-haul movement (from the country assembly point to the retail outlet) is hauled largely by for-hire motor carriers. These' are truck operators whose primary business is to haul commodities or other types of merchandise for the general public for compensation.

Two types of for-hire motor carriers engage in hauling seeds exempt and regulated. This distinction is based upon the Motor Carrier Act of 1935, which provided generally for the Federal regulation of motor carriers engaged in interstate transportation.

The act contained exemptions for vehicles hauling non-manufactured agricultural commodities, such as fresh fruit and vegetables, grain, poultry and eggs, ordinary livestock, and seeds.

The term "exempt carrier" is applied to motor carriers that haul exempt commodities only. They are subject to rules and regulations of the Interstate Commerce Commission as to safety and hours of service of drivers, but they are not subject to regulation by the Commission over entry into the trucking business, the rates charged, and routes served.

Regulated carriers hold authority from the ICC for the transportation of other than exempt commodities. They may also haul exempt commodities and, when doing so, are not subject to economic regulation by the ICC as to those commodities, as long as no nonexempt commodities are moved in the same truck at the same time.

Exempt agricultural commodities, such as seeds, serve to balance out the return-haul movement for many regulated motor carriers, particularly the large regulated motor carriers in the Far West, since their inbound tonnage of manufactured goods for California and the Pacific Northwest exceeds the outbound tonnage of this type of merchandise. Not all of the truck portion of the seed tonnage moving from the Far West is hauled by the regulated motor carriers, however. Exempt motor carriers also haul a part.

Both exempt and regulated motor carriers haul seed grain from the production branches or country warehouses of seed wholesalers in the Midwest to their retail dealers. Exempt truckers are also used extensively in hauling seed potatoes from Boston to growers and dealers in the Middle Atlantic and Southeastern States. This haul is particularly attractive to the exempt trucker, since ordinarily he has delivered a load of fresh fruit, vegetables, or citrus fruit to New England and is looking for a return haul to the Southeast.

AN ADVANTAGE of using rail carriers to ship seed is the transit arrangement. Seed may be shipped from California to a wholesaler in the Midwest, where it may undergo further processing and then be forwarded to the final destination at the rate that applied to a direct movement of seed from its origin to final destination.

An example, based on the rail rates in effect in February 1960, illustrates the cost advantage of this transit privilege to a Midwest wholesaler. The through rate for a shipment moving directly from California to final destination in Illinois is 1.35 dollars per hundredweight. Without the transit privilege, the wholesaler would pay the local rate of 1.29 dollars from the California production area to a transit point in Missouri. After the seed has been processed and prepared for reshipment, he would again pay a local rate this time 99 cents from the transit point to Illinois. The combination of local rates would result in a total transportation cost of 2.98 dollars per hundredweight.

Under the transit arrangement, the wholesaler would pay only 1.405 dollars per 100 pounds. This includes the local rate of 1.29 dollars from the California production area to the Missouri transit point, a separate transit charge of 5.5 cents per 100 pounds, and a balance on the outbound shipment of 6 cents per 100 pounds (the difference between the local rate of 1.29 dollars and the through rate of 1.35 dollars).

The saving on the transit privilege is 87.5 cents per 100 pounds, or 700 dollars on a carload shipment of 80 thousand pounds.

The saving is a major reason why many shippers of seeds prefer rail transportation. Some shippers, however, have found that sometimes it is cheaper to use trucks for either the inbound or outbound movement, although by so doing they give up the transit privilege and thus must pay the local rail rate in combination with the truck rate. The railroads have lowered their rates in some instances to meet this truck competition.

Convenience of loading and unloading is another advantage of using rail transportation for shipping seeds. The shipper or receiver has 48 hours free of charge for loading or unloading the car after it has been placed at his disposal. Additional time beyond the 48 hours is subject to the payment of a published demurrage charge.

Trucking companies do not consider this type of service economically feasible, because the driver and perhaps an alternate driver will accompany the equipment and must be paid for waiting time. The truckers therefore are anxious to get their equipment loaded and unloaded as quickly as possible and back on the road.

Rail carriers can handle large shipments on long hauls at low rates. For example, some seeds, such as beans and peas, are shipped from the Far West with minimum carload quantities as high as 80 thousand pounds. The railroads introduced these high minimum carload weights to encourage the shippers to load the cars more heavily. For example, the rail rate on dry beans shipped from California to Texas is 1 dollar per 100 pounds for carloads with a minimum weight of 80 thousand pounds. The rate is 2.24 dollars a hundredweight for carload shipments with a minimum of 40 thousand pounds.

TRUCKS usually can make deliveries from the warehouse of a seed wholesaler to his customers in less time than it would take to move them by rail.

Speed is important late in the planting season, when retail dealers may run out of certain varieties of seeds and need refill orders immediately or when emergency conditions, such as floods and droughts, may have ruined a farmer's first planting and he needs seed for replanting.

Speed also is important in the servicing of the supermarket trade by seed wholesalers. Because the large chains operate on the basis of a fast turnover and a minimum of inventory, they need to replenish their stocks of seeds several times during the season. They therefore specify the date and hour of delivery, a date that makes mandatory the fastest transportation.

A large share of the seed-marketing business does not require fast delivery service, of course. Because most of the seed of grass, legumes, grains, vegetables, and flowers are harvested in the late summer and fall, several months elapse before it is needed for planting. During this interval, the seed is in storage in the wholesaler's warehouse. In order to reduce his storage risk and to insure a more orderly method of distribution, he begins shipments to independent retail seed dealers as early as December. He uses rail and truck transportation.