Block Rejects Proposed Quota on Navel Oranges

Agriculture Secretary John R. Block broke with tradition late Wednesday in rejecting a recommendation by California’s navel orange industry to begin limiting shipments of fresh oranges for the week starting midnight tonight. This is the first time that an agriculture secretary has rejected a quota recommendation from the committee of 11 growers and handlers, according to Billy J. Peightal, manager of the Navel Orange Administrative Committee in Los Angeles.

The committee administers a federal “marketing order” financed by the industry that, among other things, allows for limiting shipments to market to maintain steady supplies and prices.

However, Block had lifted shipping quotas last February for the remainder of the navel season, maintaining that supplies and prices were adequate without limitation of supply.

The committee recommended on Tuesday that Block approve restricting orange shipments for the coming week to 1,300 carloads (each of which contains 1,000 37.5-pound boxes of fruit). It said supplies should be restricted because of weak consumer demand and low prices stemming from small, relatively poor quality, early fruit and continuing competition from late-harvest Valencia oranges.

Peightal said Block decided that invoking restrictions this week would be premature but left open the option to do so later. The committee meets Tuesdays to review supply and demand and recommends to Block how much fruit it thinks that the market can absorb without sending stocks and prices on a roller-coaster ride.

Aside from last year’s mid-season suspension of the quota system, called “prorate,” Block and his predecessors have routinely approved the committee’s recommendations for the last 33 years.

Block has yet to act on the committee’s annual marketing strategy for the season. This document includes a proposed prorate schedule listing anticipated weekly shipments.