Assessing Federal Grade Criteria for Fruits and Vegetables: Should Nutrient Attributes Be Incorporated? Carl Zulauf and Thomas L
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Session on Commodity Grade Criteria Assessing Federal Grade Criteria for Fruits and Vegetables: Should Nutrient Attributes Be Incorporated? Carl Zulauf and Thomas L. Sporlederl The U.S. Department of Agriculture (USDA) grading system for fruits and vegetables. has a long-established system for fruit and From this description, we generate some vegetable grades (USDA, Agriculture generic components of the current federal Marketing Service(AMS) 1990). A primary grade standards and discuss the potential purpose of federal commodity grades is to for adding nutrient attributes and the facilitate the wholesale exchange by relationship between sensory and nutrient allowing sale by description rather than by attributes. We conclude by evaluating the inspection (Office of Technology feasibility of a nutrient-based grading Assessment 1977). Consequently, buyers standard for fruits and vegetables. and sellers can consummate transactions without the time and expense necessary to The Economic Function and physically congregate in one location to Consequences of Grades inspect the commodity being sold. The Fruits and vegetables, like most farm result is lower transaction costs, which in commodities, exhibit a wide array of quality turn can mean lower prices for consumers attributes. An important function of the and/or higher prices for producers. grading system is the "grouping of Current grade standards for fruits continuous quality gradations of a and vegetables use attributes based on commodity into a few grades or classes" sensory characteristics,2 shelf-life (Rhodes 1988). If the resulting considerations, palatability, or a differentiation of the commodity combination of these factors. During recent communicates relevant information about years "health consciousness" has increased quality attributes important to market among consumers. Furthermore, a growing participants, then the grading system will number of studies has demonstrated health allow wholesalers, retailers, and others to benefits from various nutrients contained in exchange commodities on the basis of relatively large amounts in fruits and description rather than personal inspection. vegetables (e.g., Consumer Reports 1992, p. As a consequence, transaction costs are 648). Consequently, questions arise about lowered, and overall marketing efficiency is the feasibility and desirability of enhanced (Farris 1960). In addition, federal incorporating nutrient attributes into grades also are thought to improve public current standards or replacing the current price reporting (Henderson et al. 1983). sensory-based standards with nutrient- Once a commodity is sorted into a based standards. These possibilities provide few grades, each grade can command a the impetus and focus for this research.3 price based on its quality attributes. Thus, Initially, we focus on the economic producers receive price signals through the function and consequences of commodity market about what to produce—i.e., the grades and describe the current federal quality attributes which maximize their 1The authors wish to acknowledge the significant contributions of their co-authors on the Office of Technology Assessment Study from which this article is drawn: Rebecca Boerger, Eugene Jones, and Timothy Rhodus, Agricultural Economists; and Mark Bennett, James Hoskins, and Kurt Wiese, Horticulturalists. Thanks is also extended to Pam Brown for considerable typing and editorial assistance. 2Those affecting consumers' senses, such as touch, sight, and taste. 3Given consumer concerns about pesticides in food, a similar question has been raised about incorporating chemicals in grade standards. This matter is discussed in the appendix to this paper. 130 Session on Commodity Grade Criteria returns. Also, grades can potentially affect Dried and Dehydrated Fruits 14 the geographic distribution of production Frozen Fruits 21 (Nichols et al. 1983). Vegetables for Fresh Market: Critics of the current grading system Wholesale Market 58 often argue that it does not capture the Consumer Retail Market 12 quality attributes which are the most Vegetables for Processing 24 relevant to buyers, particularly consumers. Canned Vegetables 39 Some are excluded because they are difficult Frozen Vegetables 26 to measure and/or transmit through Although the dates when the current grade marketing channels. Moreover, Rhodes and standards became effective vary widely, a Kiehl (1956) observe that the great majority for fresh fruit and vegetables were differences among consumers make it before 1960, while those for processed fruit difficult to establish homogenous grade and vegetables generally are of more recent categories. In short, a grading system must vintage. compromise between being easily Grading factors listed in standards understood by market participants, on the for fresh and processed fruits and one hand, and capturing the complexity and vegetables can be broadly divided into four diversity of consumer demand, on the other. main categories: size, quality, condition, and However,Padberg (1977) argues that a tolerances. Size can be described by grading system can have value even if it is diameter, length, weight, and uniformity of not well understood and used by consumers sizing(USDA, AMS 1988). Quality factors, in making purchasing decisions, for the defined as "the combination of the inherent mere existence of grades can reassure properties or attributes of a product which consumers that a government agency is determines its relative degree of excellence" monitoring product quality. (Hal 1990), generally refer to attributes that remain permanent once the commodity is Current Federal Grades for harvested or processed. Examples include Fruits and Vegetables variety, cleanliness, and shape for fresh Current grade standards for fruits and fruits and vegetables; and color, clarity, and vegetables are administered by USDA flavor and aroma for processed fruits and under authority of the Agricultural vegetables. Marketing Act of 1946. One hundred fifty- Condition refers to:"the relative eight grade standards cover 85 fresh fruit, degree of soundness of a product which vegetable, nut, and related commodities, may affect its merchantability and includes while 155 grade standards cover 74 those factors which are subject to change processed fruits, vegetables and related and may result from but not necessarily commodities. The grade standards for fruits, limited to age, improper handling, storage and vegetables can be grouped as follows:4 or lack of refrigeration.. ." (Code of Federal Fruits for Fresh Market: Regulation 1990). In contrast to quality Wholesale Market 29 factors, condition factors can change once Raw Products for Processing 15 the commodity is harvested or processed. Fruits for Processing 15 Tolerances are legal limits on Canned Fruits 36 unacceptable size, quality, and condition grading factors. They generally are stated in 4A complete listing of the fruit and vegetable grades percentage terms and can vary by product, is contained in the Office of Technology Assessment use, or size of the individually packaged report, Assessing Federal Grade Criteria for Fruits and product. For example, the tolerances for U.S. Vegetables, 1992. Number 1 apples for processing illustrate 131 Session on Commodity Grade Criteria the variety of forms that tolerances can take: Necessary conditions for nutrition to be (1) no more than 10 percent of apples with included in grades are the three common quality and condition defects including no elements shared by size, quality, and more than 2 percent of apples with decay,2 condition factors in the current grading percent with internal breakdown and 5 standards:(1) measurability,(2) a body of percent with wormholes, and (2) the apples information which provides a reference cannot be further advanced in maturity than point in setting the grade, and (3) variability generally firm ripe (Code of Federal among individual specimens of the Regulation, Part 7, Sections 51.300 to 51.349, commodity. Each ofthese three necessary 1990). conditions is discussed below. Unlike fresh fruits and vegetables, tolerances for processed commodities Assessment of Current Techniques and usually are stated in terms of a grade score Methods for Measuring Nutrient for the attribute, based on an assessment of Attributes the degree to which the attribute is present. Besides water, fruits and vegetables,usually The higher the score, the better the grade. A contain significant amounts of most or all minimum score exists for each grade. Any types of carbohydrates, such as sugars, commodity failing to meet the minimum starches, and fiber. They also contain requirement of the lowest grade becomes vitamins (notably A and C)and smaller, but part of the "substandard" grade. As not nutritionally insignificant, amounts of examples of the scoring system, good color minerals and protein.5 Specific methods of and clarity of U.S. Grade A frozen analysis exist for each nutrient category but concentrated apple juice must have a score with varying degrees of accuracy, of 18 to 20, while U.S. Grade A canned simplicity, and cost. orange juice must have a minimum total Beecher and Vanderslice (1983) have score of 90(Code of Federal Regulation, Part 7, categorized methods of nutrient analysis as Sections 52.1551 to 52.1557 and 52.6321 to adequate, substantial, conflicting, or lacking 52.6332,1990). (Table 1). They argue that "the boundary Size, quality, and condition grading between acceptable and unacceptable factors have three elements in common:(1)