nut Processing at Henderson, Kentucky

R. C. MANGELSDORF, _St. Louis, Mo._

MR. MANGELSDORF: Mr. Walker and Mr. McDonald are unable to be here
today, and I don't know if I can fill their shoes or not, because I am
not in the purchasing or processing end of the black walnut business.

We started this black walnut shelling operation a season ago at
Henderson, Kentucky, with the idea of processing the nuts there and
transporting the kernels to St. Louis for final processing and
marketing. At Henderson, Kentucky we are located outside the city limit,
and we have no fire protection, and as a result, the insurance rates on
our building, storage sheds, and black walnuts in storage have been so
high that we are looking around for possible plant location sites where
we can reduce that expense of operation.

Another factor in our operation there is the transportation of raw
material to our cracking site. If we have to transport black walnuts,
which give an approximate 10 per cent yield, any distance, the freight
adds materially to the cost per pound of the finished material. That is,
if we have to pay 10 cents per hundred additional freight cost in
transporting them from outlying districts to the cracking plant, that
adds a cent a pound to the cost of the finished kernels. All such
factors, have to be given weighty consideration, because our business is
primarily concerned with making money for the stockholders. If we don't
make money for the stockholders, they are not interested in seeing us
continue the operation.

Mr. Walker and Mr. McDonald at the present time are out on a crop
inspection trip and also making surveys of locations and availability of
buildings or sites that might be more advantageous than the one at
Henderson, Kentucky. It may be that we will continue the operation
there, making modifications in the building, which will result in lower
insurance rates. At the present time, with the new crop coming on, we
are in a chaotic state of affairs, because we just don't know exactly
what's the best path to follow in our operation at Henderson, Kentucky.

Are there any questions?

DR. MCKAY: Will you tell us something about how you handle the nuts in
your plant, how they are hulled and cracked, and so forth?

MR. MANGELSDORF: It's a similar operation to what Mr. Lemke described.
The nuts are brought in in burlap bags by the farmers and growers and
are put in storage in cribs. The plant at Henderson, Kentucky, w