Potomac Yard, the haul to Philadelphia is 3 miles longer, and the carmile and ton-mile earnings a small fraction less. The movement over both the Baltimore & Ohio and the Pennsylvania from Potomac Yard to Philadelphia is directly through Wilmington and Chester, to which the hauls are 26 and 13 miles, respectively, shorter. Ashland, Va., and Darby, Pa., are the first and last higher-rated intermediate points of destination on the short route above described, 647 and 833 miles from Brunswick, to which the present rates of 33 and 47 cents are to be maintained. These rates are based on the commodity rate to Richmond, now 22 cents, plus sixth-class rates from Richmond, 11 and 25 cents, respectively.

The rate to Philadelphia is to be maintained also over the Atlanta, Birmingham & Coast to Atlanta, Ga., thence the Seaboard Air Line to Richmond, thence the Richmond, Fredericksburg & Potomac to Potomac Yard, and thence the Pennsylvania, a haul of 1,171 miles which is 39 percent circuitous. Over this route the 32-cent rate would yield 21.9 cents per car-mile on 80,000 pounds and 13.7 cents on 50,000 pounds. The ton-mile revenue would be 5.5 mills. A 29.5-cent rate would yield 20.2 cents per car-mile on 80,000 pounds and 12.7 cents on 50,000 pounds, with a ton-mile yield of 5.04 mills. All intermediate points of origin on the Atlanta, Birmingham & Coast and on the Seaboard as far north as Paschall, N. C., are higher-rated points. From Benedict and Haralson, Ga., for example, on the Atlanta, Birmingham & Coast, and from which the respective hauls to Philadelphia are 1,164 and 886 miles, applicants propose to maintain the present rates, 62 and 66 cents, and from Paschall, 350 miles to Philadelphia, the present rate of 35 cents. These rates are the eighthclass rates governed by the southern classification.

Applicants propose to maintain the rate to Wilmington also over the route of the Atlanta, Birmingham & Coast to Atlanta, Ga., thence the Southern Railway to Winston-Salem, N. C., thence the line of the Norfolk and Western Railway Company to Hagerstown Junction, Md., thence the line of the Western Maryland Railway Company to Lurgan, Pa., and the Reading Company beyond, a haul of 1,240 miles, which is 53 percent circuitous as compared with the shortest tariff route of 812 miles to that point. This route, which is the most circuitous route shown of record, is excluded from the grant of temporary relief which is subject to a 50-percent circuity limitation. Applicants urge that the use of this route be authorized for the reason that it is the only route which will afford the Reading a haul on traffic to Wilmington. Over this route the 32-cent rate would yield 20.7 cents per car-mile on a load of 80,000 pounds and 12.9 cents per car-mile on a car of 50,000 pounds, and ton-mile earnings would be

5.2 mills. A rate of 29.5 cents would yield 19 and 11.9 cents per carmile, respectively, and 4.75 mills per ton-mile. If the 32-cent rate were applied over this route, Derita, N. C., and Silver Brook, Del., would be the first and last higher-rated intermediate points of destination, 364 and 1,236 miles from Brunswick, to which the present rates are 34 and 62 cents. Under the 50-percent limitation imposed in the temporary order the rate may be applied over routes of as much as 1,218 miles, and on a haul of this length the 32-cent rate would yield 21 cents per car-mile on 80,000 pounds and 19.4 cents on 50,000 pounds.

The average car-mile revenues of class I roads on all freight traffic for the year 1936 were 22.728 cents in the southern district, on an average haul of 198.9 miles, and 27.502 cents in the eastern district, on an average haul of 172.31 miles; the averages of car-mile expenses were 14.862 cents and 17.152 cents, respectively. The averages of tonmile freight revenue were 10.26 and 9.67 mills, and of ton-mile expenses 6.71 and 6.03 mills in the southern and eastern districts, respectively. It is testified that the movement of the traffic here under consideration does not require added train-miles. The added expense for added traffic is of course much less than the average expense for all traffic.

In Wood Pulp From Fernandina, Fla., to Philadelphia, Pa., 231 I. C. C. 36, we granted applicants herein fourth-section authority to establish and maintain a rate not less than 29.5 cents on wood pulp, not ground or powdered, minimum 80,000 pounds, from Fernandina, Fla., to Philadelphia and Pencoyd, Pa., over routes not more than 50 percent circuitous, because of water competition under circumstances and conditions similar to those affecting the traffic here considered. It was there shown that the Pan-Atlantic had seven steamers in operation on the Atlantic seaboard that could handle the traffic. We were not there convinced that the charges quoted for the water haul, aggregating 26.1 cents, would continue to be available indefinitely, and limited the relief granted to a period of 2 years from the date of the order. The rate there approved and established was later also increased to 32 cents. In Rags and Paper to Newark, N. Y., 208 I. C. C. 327, we found that actual movement by water is not necessary to establish the existence of water competition when competent water carriers are available and have offered to transport the traffic. It appears that the water carriers have made a bona fide offer. to transport the traffic from Brunswick to Philadelphia and Wilmington, at rates hereinbefore stated; and that they have the facilities and are ready, able, and willing to transport the traffic.

It does not appear that there is need for authority to establish a rate less than 32 cents, or a minimum less than 80,000 pounds. Shipments have moved at that rate and the cars used were loaded to that weight. The rate of 32 cents is reasonably compensatory over the routes specified in the application and is no lower than necessary to meet competition with the carriers by water. However, because of the uncertainty and instability of the charges for transportation by water, we conclude, as in Wood Pulp From Fernandina, Fla., to Philadelphia, Pa., supra, that relief herein should be granted only for a further limited period.

Upon the record herein we find that relief is justified, subject to the conditions and limitations hereinafter prescribed. Since relief is not based on circuity, the imposition of the equidistant provision of section 4 is not mandatory.

Applicants will be authorized to establish, and maintain for a period of 2 years from the date of this report and the order herein, a rate of not less than 32 cents on wood pulp, not powdered, as hereinbefore described, in carloads, minima 50,000 pounds for cars 40 feet 6 inches or less in length and 70,000 pounds for cars over 40 feet 6 inches, inside measurements, over their routes from Brunswick to Philadelphia, Chester, and Wilmington, and to maintain higher rates from, to, and between intermediate points; provided, that the present rates from and to such higher-rated intermediate points shall not be increased, except as authorized by this Commission, nor exceed the lowest combination of rates subject to the act; and provided further, that the relief granted shall not apply to routes that are more than 53 percent circuitous. All other and further relief will be denied. An appropriate order will be entered.

235 I. C. C.

FOURTH SECTION APPLICATION No. 17703

CITRUS FRUIT FROM TEXAS TO NEW ORLEANS

Submitted July 15, 1939. Decided December 18, 1939

Authority granted, on conditions, to establish and maintain rates on citrus fruit, in carloads, from points in Texas to New Orleans, La., without observing the long-and-short-haul provision of section 4 of the Interstate Commerce Act.

C. W. Waterman, Baker, Botts, Andrews & Wharton, and William H. Watts for applicants.

J. W. Stanard, E. H. Thornton, Louis A. Schwartz, and Frank J. Ebel for various interested parties.

REPORT OF THE COMMISSION

DIVISION 2, COMMISSIONERS AITCHISON, SPLAWN, AND CASKIE BY DIVISION 2:

By this application, as amended, carriers parties thereto1 apply for authority to establish and maintain rates on citrus fruit, as described in the application, in carloads, minimum 30,600 pounds, from points in Texas, except Eagle Pass and El Paso, as named in Agent J. R. Peel's tariff I. C. C. 2965, to New Orleans, La., without observing the long-and-short-haul provision of section 4 of the Interstate Commerce Act. Relief was authorized temporarily by fourth-section order No. 13404. A hearing was held. Except as otherwise indicated, rates and differences therein will be stated in amounts per 100 pounds.

The purpose of the relief sought is to enable applicants to establish rates deemed necessary to enable citrus fruit to move from Texas producing points to New Orleans, in competition with fruit from Florida, without reducing the present rates at intermediate points on their lines not affected by such competition.

Harlingen, in the extreme southern part of Texas, is the center of the citrus-fruit region in that State, although it is expected that a large amount of acreage near Laredo will soon come into production. The short-line rail distances to New Orleans are 683 miles from Harlingen, and 720 and 696 miles from Lake Wales and Tampa, Fla.,2 respectively. The distance by water from Tampa is 546 statute

1 See appendix.

* Representative shipping points in Florida.

miles. Originally the rates on this traffic were 81 cents from Harlingen and 83 cents from Lake Wales, a difference of 2 cents in favor of Harlingen, but for some time prior to January 24, 1938, depressed rates of 64 cents from Harlingen and 55 cents from Lake Wales were in effect, reflecting a difference of 9 cents in favor of Lake Wales. On January 28, 1938, the rail rate from Lake Wales was reduced to 42 cents, and on March 28, 1938, by reason of the authorized general increases, the rate from that point became 44 cents and from Harlingen 67 cents, which increased the difference in favor of Lake Wales to 23 cents. The present rail rate from Tampa is 43 cents.

The rail rates from Florida were reduced because of low truckwater rates from points in that State to New Orleans. Scheduled water service by the Waterman Steamship Line and the ClydeMallory Lines has been available for some time. The average truck rate from interior Florida points to the ports, such as Tampa, is 8 cents per box of 90 pounds; the water rate is 26 cents; and the drayage cost from the docks to warehouses at New Orleans is 3 to 4 cents, making the total cost approximately 38 cents per box, or 42 cents per 100 pounds, as compared with the present rail rates of 44 cents from Lake Wales and 67 cents from Harlingen. In 1937 and 1938 there was a small movement by water of citrus fruit from the Texas ports of Brownsville and Port Isabel to New Orleans, but at the present time no shipments move by water. The following table compiled from an exhibit of record shows the movement of citrus fruit, in carloads, from Florida and Texas, by rail and water, to New Orleans.

The figures for 1939 as set forth above are not complete, because the shipping season begins early in October and continues into the following March or April. The production of citrus fruit in Texas for the 1937-38 season amounted to 33,371 carloads, and for the same period the Florida production amounted to 103,349 carloads. The estimated production for 1939 is 42,876 carloads for Texas and 126,250 carloads for Florida. The New Orleans market consumes from 650 to 850 carloads annually.

As previously indicated, the short-line distance from Harlingen to New Orleans, which involves seven junctions, is 683 miles. The pro