CONTENTS Garnett, Gwynn, Administrator, Foreign Agricultural Service, read Nichols, C. W., Deputy Director, Office of International Resources, Robinson, T. C. M., Bureau of Economics, the State Department... Table 1. The supply and disposition of United States rice (rough) Table 2. United States rice production and exports including Table II. Dispositions of CCC-owned rice in fiscal years 1957 4 McLain, Marvin L., Assistant Secretary of Agriculture, Washington, Miller, Claude, president, Comet Rice Mills.. Table I.-Dispositions of CCC-owned rice in fiscal years 1957 and 38 Mr. NICHOLS. To the best of my knowledge, the discussions with India having to do with another Public Law 480 agreement have not been directly affected by the new mills or the financing of new mills. Perhaps, I didn't exactly understand the connection you are making. Mr. GATHINGS. The understanding that I received is that the representatives of India in Washington have been trying to obtain added tonnage of rice in Public Law 480 agreements, but that on the part of the Department of State, you folks have insisted, according to the information that I received, that they should not take rice at all, suggesting that what they needed to do was to run those new mills that have been produced over there with ICA funds, and to take an increased amount of wheat. Of course, we want to move wheat, too. If we have wheat in surplus supply we want to move it. We want to see where that balance is. Whether or not you have insisted that a larger quantity of wheat would be thrust upon these people who have demanded rice, and have customarily eaten rice. Mr. NICHOLS. I think I begin to understand the theory, at least. I had not heard either as a fact or as an allegation up to now that wheat in place of rice was being made available for the particular purpose of supplying wheat flour mills which the United States had financed. To the best of my knowledge, sir, there is no basis for that thought. Mr. GATHINGS. Is there a basis for the thought that the Department of State of our Government is insistent on the people of India eating more wheat when they don't want wheat and want rice? Mr. NICHOLS. No, I am not aware of it. It is a large Department. As I mentioned before, there are contracts with people in the trade throughout the Government, throughout the Department. I have been fairly close to this, and I do not know that it has any such element in it whatsoever. There have been discussions off and on since last summer with representatives of the Government of India looking toward another Public Law 480 agreement. And I have no doubt that some time in 1958, probably after the Public Law 480 bill is provided with more authority and extended life that there will be another negotiation. Mr. GATHINGS. Mr. Nehru is here now, is that right, and has been? Mr. NICHOLS. He was recently. I am not sure that he is here at the moment. Mr. GATHINGS. And he requested quite a large quantity of rice to be made available under Public Law 480; is that right? Mr. NICHOLS. I believe it was referred to recently. It was referred to last summer. Let me state my understanding of this. The commodities and the amounts mentioned do not always mean and could not be taken to mean what some might infer. Some of these quantities have had to do with long-term assurances. They should not be thought of as an Indian statement of near-term consumption requirements. The general position of the Government of India is related to a 5year program and it is apparent that this program is straining them, so that some of the quantities mentioned apart from what commodity, to be used as the vehicle, really, they were looking toward assurance over a period of several years, perhaps as far as 1960 or 1961, that their whole food grain requirement would not be an unmanageable burden on their limited foreign exchange resources. So that there have been, as you know, and no doubt heard at various places, quantities of wheat and rice mentioned at one time or another that were extremely huge, but they should not be thought of as being consumption requirements for this year or any particular immediate period. Mr. GATHINGS. Just what mention was made as to the rice as to quantity? Mr. NICHOLS. I think there was mention at one time of a million tons of rice and 2 or 3 million tons of wheat. Very large quantities have been mentioned. But in terms of any prospect of practical negotiations or distribution in limited periods, they haven't been reduced to practicalities yet. It remains to be seen when they might be. The whole question of negotiated Public Law 480 agreements for periods of years ahead is a difficult one. If they are scheduled in large amounts which would have to fit into unknown future marketing situations, the possibilities of congestion and conflict are somewhat greater than if we can operate essentially year to year, and know that the Public Law 480 commodities are what they are supposed to be, and that is generally supplementary to the imports that are financed by other ways. Mr. GATHINGS. Yes. That provision is written into the act itself. Mr. THOMPSON. I am afraid that we will have to stop at this time. We will probably get a rollcall or a quorum call in a few minutes. The measure before us would freeze acreage and price supports at present levels, and it certainly behooves all of us to be there. Thank you very much for your presence and your testimony, gentlemen. I think we will have to have some further discussions. Mr. NICHOLS. Thank you. Mr. THOMPSON. And I think we may sum this up this morning by saying, we certainly have developed that there is a market for rice that is not being filled, that if that market were filled, there would be no acreage reduction for next year's crop of rice, and the price support would be 86 instead of 75 percent. We certainly developed that. Thank you very much for your testimony. The committee stands adjourned, subject to the call of the Chair. (Whereupon, at 12 o'clock noon, the hearing in the above-entitled matter was adjourned.) RICE ACREAGE, 1958 TUESDAY, APRIL 29, 1958 HOUSE OF REPRESENTATIVES, COMMODITY SUBCOMMITTEE ON RICE OF THE COMMITTEE ON AGRICULTURE, The subcommittee met, pursuant to notice, at 10 a. m., in room 1308, New House Office Building, Hon. Clark W. Thompson (chairman of the subcommittee) presiding. Present: Representatives Thompson, Gathings, Jones, and Krueger. Mr. THOMPSON. The committee will be in order. Gentlemen, for the benefit of all here present, I would like to give you just a little bit of the background of this particular meeting. The rice industry is a very troubled and worried industry from producer on through miller, including everybody, I guess, except the consumer; and some places in the world, the consumers are a little troubled. We don't know, in the industry, what the future holds. We don't know what the export program is going to be for next year. We are not sure that we know what the acreage program is going to be. We don't know what the price support will be. With those various problems in mind, and without any specific questions to ask at this particular time, anyway, we have asked Mr. Marvin McLain, who is certainly-if he isn't the policymaker, he is on the policymaking level so far as this industry is concerned, if he would come up here and tell us exactly what we have to look forward to and what the program is to be. I am going to suggest that after he has testified in any manner that he desires, that we go ahead with what questions occur to us and then let others from the industry who may be present, whether they made themselves known to me or not, join into the discussion either as witnesses or, perhaps, since it is a small group and a small place, we can make it more or less as a round-table discussion. Mr. McLain, with that introduction and story of what we are trying to accomplish, we will appreciate hearing from you. STATEMENT OF MARVIN L. McLAIN, ASSISTANT SECRETARY OF AGRICULTURE, WASHINGTON, D. C. Mr. McLAIN. Mr. Chairman, I have prepared here a very brief statement. We can get some of the facts as we see them in the Department out here, if I just run through them hurriedly. We will try to answer any questions you may have about the state ment. |