Agribusiness: Sophisticated Farming and California Land

Agriculture is now big business in the United States and has evolved into vast farming complexes. A prime example is Producers Cotton Oil Company, acquired by Bangor Punta in 1967.

Before a single acre of land is tilled, Producers' engineers, agronomists and economists measure sunlight, average rainfall, drainage and soil content and evaluate market conditions.

To provide a complete systems approach to farming, the company also uses an IBM 360 computer for cost accounting procedures and to monitor field operations.

The result is agriculture operated in a sophisticated, mechanized way—or Agribusiness. Bangor Punta's Agribusiness group, which is included for the nine month period since acquisition January 1, 1968, added 10% to total revenues and 6% to profit contribution.

In 1968, Producers began receiving fresh water from the massive San Luis aqueduct, part of a $1.8 billion water project. Drawn from the mountains of Northern California, the water is low in mineral content and excellent for most vegetable and field crops. It will largely replace the high-cost, deep-well water presently being used.

This fresh water irrigation permitted the opening of a new cotton area in the southern part of the San Joaquin Valley during 1968. Berrenda Mesa Gin, one of 70 electronically controlled gins operated by PCOC, was constructed next to the new cotton area.

Water—fresh and free of minerals —gushes through an irrigation ditch in California's San Joaquin Valley where Bangor Punta's Agribusiness group owns 58,000 acres. Opening of San Luis canal now brings enough fresh water to irrigate 1.2 million acres in the valley—permitting more crop diversification.

Bangor Punta's acreage also offers vast potential for real estate development. At left, one man at central pushbutton panel controls entire operations for a modern cotton gin.

Producers' major revenues come from cotton ginning, cottonseed products and such commodity foods as potatoes and tomatoes.

The most important cottonseed product is oil, a major ingredient in mayonnaise, shortening and salad dressing. It has been found effective in the control of cholesterol—believed to be a factor in heart and blood vessel diseases.

PCOC owns 58,000 acres of land in California's San Joaquin Valley, one of the most fertile areas in the world. The land, currently valued far in excess of book value, also has potential for real estate development. In addition, PCOC owns 6,000 acres in Arizona and leases 44,000 acres in California and 3,500 in Arizona.

Source: Bangor Punta Annual Report for the Year Ended September 30, 1968, Page 18