Economic Analysis Of Storing Apples In North Carolina

Apple storage in North Carolina is one way of extending the fresh apple market sales period. Some apple packers have already invested in facilities; others are considering the possibilities. The purpose of this study is to provide cost and return estimates associated with predetermined sizes of cold storage tmits. Four units of 50, 100, 150, and 200 thousand bushel capacities were selected. An economicengineering procedure was used to analyze data collected from current storage operators, building contractors and equipment dealers. Construction of these units was designed to handle 18-bushel bin boxes. Materials include a concrete slab floor, steel metal exterior and urethane insulation. Refrigeration equipment was designed with capacity to reduce field heat of apples to 32 degrees within 48 hours. Total annual costs per bushel capacity ranged from $1.03 for the smallest unit to 92 cents for the largest unit. Annual operating costs amount to about 27 cents per bushel capacity for all four units. Annual overhead costs ranged from 76 cents per bushel capacity for a 50,000 bushel unit to 65 cents per bushel capacity for a 200,000 bushel unit. A stock turnover of twice a season reduced the annual total costs by almost 45 percent. The expected profitability of long-run storage was evaluated by comparing relative prices. Pricing conditions in the past have been more favorable for storage if apples were stored in the latter half of the harvest period. But apple quality and length of shelf life become important considerations.