Mr. GATHINGS. Public Law 480 is most important to the rice industry, no doubt. You know there is something that might be very valuable in the record right here.

If, and I am sure you have it readily available, you could let us have it, it would be a listing of the demand for rice over the past few years by various different countries, how much we have been able to furnish them.

Mr. McLAIN. Of what they wanted?

Mr. THOMPSON. I mean demands on 480. You have that, don't you? Mr. McLAIN. We would have to talk to our 480 people about that. I don't know whether they keep a record of all the demands for all commodities or not.

Mr. THOMPSON. It would be very helpful to us when we try to get 480 passed to be able to say that this is what has happened in Public Law 480: We have had so many requests; we have filled so many. If we had more authority, we could fill so many more.

Mr. McLAIN. I would suggest this, if I might: You are going to have the hearing when all the 480 people are going to be here. I think you ought to have this information for all commodities. I would request that at that time. I think it would be more appropriate. Mr. SORKIN. It will be up on the 5th.

Mr. DEAN. Getting back to Mr. Gathing's question: As you remember, Mr. Gathings, after the takeover in 1952, 1954 and 1955 a milling program was developed because of a lack of storage, particularly in the South for rough rice and the milled stocks moved into CCC inventory. These stocks were put up for sale on a competitive bid basis for export for dollar sales and title I, Public Law 480.

Now, as you know, recently, we have changed the rice sales program where we are now offering CCC-owned rough rice for sale for export on competitive bids under the requirement that all of the milled rice from this rough rice must be exported.

Basically, I wanted to bring it up and I wanted to get the record clear that we have not had any trouble in moving a reasonable quan. tity of rice for dollars.

This is over 1 million hundredweight that we have moved for dollars and we are planning for this coming year about 3 million. Here is the program for this coming year.

In the past, what did CCC do for the rice people? We would take the rough rice over under the price support program and move it into a mill and exchange the rough rice for milled rice. Then we would take the milled rice and put it into storage until the rice could be programed. We have done that for 3 straight years. This year, the program is simply this:

We are going to mill a certain quantity of the takeover of rough rice and we have just recently completed takeover in the South of 10 million hundredweight and 2 million on the west coast.

We are going to mill enough rough rice to get out of the way of the new crop.

In other words, we can't leave our rice out there to take up storage space when we have a new crop coming on, so that quantity will be milled and put into storage for program needs, particularly title 1.

The balance of the rice, which we will hold in the form of rough, will be put up for sale for export by our officer in Dallas, Tex., on competitive bids; the successful bidder must export the quantity of

lina and Georgia, Florida, more or less generally through the southeast area of the United States, the per capita consumption is relatively high. The highest a few years ago, at least, was in the southern part of Louisiana where it was, oh, almost 100 pounds per capita.

If you get up into some of the Northern States-I do not know about North Dakota specifically, probably up there it is considerably less than a pound per capita.

Then you have islands, you might say, for instance, in New York City, you have certain population groups up there that have a rather high per capita consumption. Puerto Ricans particularly—and the colored population would come next-eat it. And you have pretty much of a cross section. There are people who use a lot of rice and people who do not use any. In any large city you do have population groups that are fairly large consumers.

Mr. GATHINGS. I remember about 2 years ago they packaged some broken rice in about 10-pound bags and had these bags in all of the larger stores in Washington. I notice today you do not see the broken grain rice, which came at a reasonable price, too, for that 10-pound bag. Do you recall that? Do you know just why it was that they sold the rice in that size quantity and that particular type of rice? putting it out that way.

Mr. ELLIS. I do not recall it, particularly, in Washington at that particular time, but people who use large quantities of rice are frequently rather price-conscious and a 10-pound bag is a much cheaper way of distributing than putting one pound cellophane or cardboard cartons around it. And the price differential would be of considerable importance.

Mr. GATHINGS. I thought that we would always find those 10-pound bags for the larger families. I do not understand why they quit putting it out that way.

Mr. THOMPSON. I think you will find at that particular time there happened to be a considerable surplus of broken rice. That comes from memory and is subject to correction.

Mr. GATHINGS. If you will pardon me for interrupting this train of thought, we have some gentlemen from the State Department here who may have some light to shed on this subject. I hope you can put them on next for the reason that when the bells ring we will have to go to the floor. We have a piece of legislation pending today that may cure some of the pains that are hurting us in the rice industry. Let us see who is going to speak.

Mr. Nichols, are you going to speak for the State Department? Mr. NICHOLS. Yes.

Mr. GATHINGS. Judge Satterfield wanted to say something.

Mr. SATTERFIELD. Congressman Thompson, you asked a question earlier which I do not believe was answered, concerning the world demand situation on rice.

Last week I received a letter from the largest rice miller in Burma who visited this country last fall to study our production and marketing methods, and he indicated that their 1957 crop was about 25 percent less than anticipated earlier. He also indicated that their entire production had already been sold.

Maybe Mr. Ellis can fill us in on what has happened in Thailand which is the second largest exporter of rice in the world. I understand they have pretty well sold out.

Mr. GATHINGS. The point I am trying to get at is this, Mr. Chairman: The matter of price is not so important with respect to rice, as I understand it, Mr. McLain.

Mr. MCLAIN. I think domestically it is not as important as it is for exports.

Mr. GATHINGS. It is not such an important factor. You are still going to get about the same.

Mr. McLAIN. I think that in export it would be very important. If you are going to sell it in the world market, you are either going to have to do it one of two ways:

You are going to keep a subsidy on it like you have, or maybe sometime do something different. I think most growers would like to see that time if it is possible and they can still make a good living at rice, to see that happen.

Mr. SORKIN. Some of the people in the rice industry say that they have been able to increase rice sales domestically with price adjustment. It is a factor but not as important as the export price.

Mr. GATHINGS. What would be the export market for dollars, at what figure?

Mr. McLAIN. The figures Mr. Dean has just given you, of course, are actual instances of where we have been selling.

Mr. GATHINGS. You will give us that percentage of the price support?

Mr. McLAIN. We will provide the range that will give you the figure you want.

Mr. DEAN. Mr. Gathings, on competitive bids we don't set the price. You, the purchaser, sets the price. That is how we get the world market price. We take competitive bids with the right to accept or reject.

Mr. GATHINGS. Of the world market price, Mr. Dean, does it vary a great deal?

Mr. DEAN. This thing of a world market price is a nebulous thing. You don't know what quality of rice you are talking about. We should not compare good quality United States rice with poor-quality rice from Siam and say that is the United States price for rice. Mr. GATHINGS. You are talking about Blue Bonnet? You are talking about good rice.

Mr. DEAN. That is the reason I picked Blue Bonnet. It is good quality.

Mr. THOMPSON. In just a few minutes I am going to suggest we interrupt this phase of the hearing and listen to a rice miller whose name is Miller, incidentally, Mr. Claude Miller, sitting over yonder. He is president of the Comet Rice Mills, which operate very extensively in my district and elsewhere in the rice country.

He and I have been corresponding about various problems. I learned that he was coming up here about this time and I suggested to him he come and sit in here with us. He has not prepared a statement unless he has jotted down some things, but the light he can shed on it could be very interesting.

Just before we do that, there are one or two questions that I would like to ask of Mr. McLain.

We have picked up, as we have gone along, some strange stories about the desire, or the tendency of this Government, to take a demand

The other gentleman will remain, will you not. I think it would be well if you did.

STATEMENT OF C. W. NICHOLS, DEPUTY DIRECTOR, OFFICE OF INTERNATIONAL RESOURCES, ACCOMPANIED BY T. C. M. ROBINSON, ASSISTANT CHIEF, COMMODITY DIVISION, DEPARTMENT OF STATE

Mr. NICHOLS. I am C. W. Nichols, with the Department of State, and my associate Mr. Tom Robinson is also with the Department. I realize that your time is becoming short.

We were told that the committee would be interested in the following things, the policies or the attitudes of the Department concerning exports of rice, the problems in relation to other countries that might be generated by special export programs, and the dangers and the difficulties in these special programs, particularly Public Law 480 from the point of view of the Department of State.

These are somewhat general. And in view of the limited time, if I may, I would like to just comment very briefly and very generally, and then we could, perhaps, move to something more specific.

The Department's interest in the matter, of course, is a derived interest. In trying to carry out international relations in a way that will serve broad objectives we do become involved in trade problems and in trade problems of particular commodities, but the Department does not have any policies of its own as to any one commodity. We try to arrange trade opportunities, in particular commodity situations in such a way that the derived benefits for the United States minimize foreign friction, but it is not our original objective to discriminate in any way as between commodities.

Let us say, basically, the Department's attitude toward international trade is one of encouraging so far as possible trade on a private basis, multilateral trade with a minimum of discrimination between countries, or governmental regulations.

For many years there have been severe limitations on the extent to which trade can be conducted in that form. These remain in varying degrees.

We are working on some emergency assistance programs, some charitable donations, the mutual security program, and in particular the Department is taking an active part in the administration of Public Law 480 in the development of the negotiated proposals and in the conduct of the negotiations with other governments, later in this scheduling sometimes of the commodities and the use of the funds. We recognize that the primary purpose of Public Law 480 has been to dispose of surpluses already generated, but we have, also, recognized an opportunity here to supplement levels with consumption to add something to the trade which would have occurred wholly commercially. We have attempted within the terms of the law to assure that these concessional types of programs on noncommercial trade do not damage or do only minimum damage to the basic possibilities of expanding trade on commercial terms.

We have felt that there are some dangers in certain parts of the world of countries becoming too dependent upon such a large fraction of their food supplies coming to them without commercial payment,

and so become somewhat undependable forces in the sense that it is not known that they could rely continuously when supplied in this

way.

On the whole, however, that has been up to this point a worry having to do with a somewhat later time, and we are convinced on balance that the Public Law 480 program has a net of pluses and advantages in the foreign relations side, without forgetting for a moment the need to continue to administer it very carefully, so that it does not harm the dollar export trade of the United States or the commercial trade on which some of our allies are very dependent. Those policies that I referred to so briefly and inadequately apply equally to all of these commodities, and also, apply to rice.

There are some special circumstances in rice which gives them a particular context, in particular the bulk of the world import market for rice is in Asia. That is where rice has been imported and where it will be imported in any substantial volume or greatly increased volume in the near future.

So all of those problems that particularly relate to Asian affairs have a greater application in the international trade of rice than they would have with some other commodities which are primarily imported in other parts of the world.

As you gentlemen know, the bulk of the world production of rice is consumed in countries where it is produced, and only a small part of the world production actually enters into international trade. This part tends to be rather erratic. It is the marginal part, so to speak, and we have seen rather rapid and extreme change from conditions of surplus in international trade or shortage with rather marked fluctuations in prices.

One of the characteristics of this rice trade, with which the Department is quite conscious is the special position of Burma and Thailand, as the principal exporters of the undeveloped but friendly countries which have only a few other products on which to earn foreign exchange they require.

It has been our earnest hope in the Department that special export programs of the United States would not be detrimental to the reasonable commercial exporting interests of these countries which are comparatively small, but quite strategically located and with which the United States as a matter of general foreign policy is quite anxious to cooperate.

We work very closely, as was indicated by Mr. Miller, with the Department of Agriculture, and on occasion with other departments that have an interest in these matters.

Probably, I should not take more of your short time with the general statement.

We appreciate the chance to be with you. And if you have any more specific questions on which we could be helpful, we would like to try to answer them.

Mr. THOMPSON. Do you know any cases where there has been an effort on the part of the Department to sell wheat rather than rice? Where a nation wanted rice and we said, "Let us give them wheat?"

Mr. NICHOLS. I do not recall a particular incident, but I would like to comment in this way: The development of some of our 480 programs is an evolutionary affair. It does not occur exactly along the