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I am glad to express my opinions and beliefs, but I cannot hope to answer questions as to the detailed facts or give statistical data, as I have not had an opportunity, nor time, to prepare such material. While I am president of the Rice Industry Association, a national rice promotion association that was formed recently, I do not speak for that group or any other group, but express only my own personal views and opinions.

I want to say at this point that in my dealings with the Department of Agriculture, I have found all of the officials and employees patient, considerate, cooperative, and helpful always.

I believe that some of the present practices and policies in dealing with rice could be improved. I am convinced that the world market can and will absorb all United States rice if rice produced in this country is offered for export at prices competitive with other sellers in the world market.

I believe if we could dispose of all rice surpluses and all future surpluses could be avoided

I

Mr. GATHINGS. Would you suffer an interruption now, Mr. Miller! That is the very point I have been trying to get at this morning. I just wondered if you could give us a little light on the subject as to just where that level would be, and what is that competitive price on a particular type of rice that is used in the rice-consuming nations of the world.

Mr. MILLER. Congressman, I have in mind in the body of the little statement that I roughed out this morning, to suggest some of these changes that would meet this situation.

Mr. GATHINGS. I don't want to jump the gun.

Mr. MILLER. If I may, when I have finished, I will be happy to I have some world prices here in my brief case that I have recently received from Japan and other places, and I will be happy to go into those to any extent that you wish.

Mr. GATHINGS. I know that you have visited in the Orient in recent months, and that you do know that situation full well.

Mr. MILLER. I went over there. I don't know how much I know about it. I tried to learn something.

Mr. MCLAIN. A pretty big place, isn't it?

Mr. MILLER. Yes, sir.

As I was saying, I think that all future surpluses could be avoided if certain improvements were made in the management of rice. It may be that existing laws compel the policies. If so, perhaps the law should be changed.

In other words, I am not suggesting why it is true. I am just suggesting that these are policies and practices which we respectfully submit could stand some improvement.

Unless some changes are made, serious consequences may befall rice millers. Some rice mills have closed in recent years, victims of the conditions that have made it impossible for them to continue to operate unless some relief is forthcoming soon.

It seems probable that other rice millers may be forced into bankruptcy also. Under the present circumstances that exist, it is difficult for even the most efficient rice mills to continue operating. Mills are expensive and cannot be easily and quickly replaced. If present mills are forced to close, it may be a long time before investors are found to build new rice mills.

During World War II there was need for rapid expansion of rice milling facilities. During and after the war, United States rice farmers and millers were called upon to meet unprecedented demands to feed our Armed Forces and send rice to allies and the other countries that depend upon rice, but whose crops had been destroyed by war activities.

Mr. McLain brought that point out in his earlier testimony.

United States rice millers met the demand, investing large sums in plants and equipment. Independent millers invested their own private funds to build these expensive mills. During the Korean war again, rice millers were called upon to meet increased demands and again they made further investments.

Since the end of the Korean war, the imposing of acreage controls has cut down the amount of rice to be milled, and the high support paid United States farmers has priced United States rice right out of the world markets.

Rice millers have been patriotic and have made big investments of funds, but they have found themselves in great difficulty. Some mills have had to close, others may be forced to suspend operation soon unless relief is found.

If another emergency should arise, the fine milling facilities that were once available, and which would be so urgently needed again, may go.

Replacement cannot be made quickly nor easily. Recently, I read that the Government is spending 42 percent of a $3 billion rehabilitation campaign to keep American shipping adequate to meet demands that could arise during an emergency.

We read that there is stockpiling of various types of strategic materials that may be needed in time of emergency. All this requires huge expenditures of public funds. If it is wise to spend billions of dollars to build ships and stockpile materials for possible future emergencies, it seems unwise to adopt practices and policies that are slowly destroying a vital food processing industry that is needed now and would be indispensable in an emergency.

I am convinced that rice millers do not want, nor need, subsidy nor Government help. I believe that if rice millers and rice farmers were permitted to carry on their business under the basic principles of free enterprise, they could grow and prosper and be ready to do their part promptly and well whenever the Nation needed them in peace and

in war.

Specifically, some of the ways that present policies and practices could be improved, in my own personal opinion, are:

First, present rice surpluses held by CCC could be offered for milling and export at prices competitive with the world market. Under RRDL 500, which Mr. Dean mentioned a few moments ago, or similar announcements, if option were granted for 30-day periods on stated lots of rice at realistic prices to individual rice millers, I believe the surpluses would soon disappear. These options are desirable since it is difficult to try to make sales unless one knows the cost of goods to be sold.

Let me stop and digress for a moment to explain what I mean. For instance, the Government of Greece at the present time has tenders out asking for submission of bids to sell rice to them.

The Government of the United States has rice offered, but it is offered on a basis of the bidder bidding the highest price to get that

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.)

It appeared that in making these decisions, great consideration was given to the effect in other areas as a lack of consideration was given to the damage they were doing to the United States rice millers.

Such far-reaching powers as a managed economy gives to the managers must be used with extreme care and caution or great damage can be done to an important food processing group.

Fourth, I am convinced that there never has been a rice surplus or price surpluses but instead a shortage of salesmanship. Given an opportunity to compete freely in the domestic and world market, I believe United States rice millers can mill and sell all the rice that United States farmers can produce. If permitted to operate in a free economy, I believe rice farmers and rice millers can solve all their own problems and can prosper and pay taxes to help carry their share of the costs of government.

Unless this freedom to live, work, and pay taxes comes soon, it may be too late for some of the rice mills.

Finally, I want to say, to thank you for having this opportunity to express my own personal views. I want to say again that I speak for myself alone, not as a representative or spokesman for any group. Mr. THOMPSON. Mr. Miller, let me ask Mr. McLain a question. This gap that Mr. Miller so graphically described, cannot be taken care of administratively or does it require a change in legislation? Mr. MCLAIN. Mr. Dean will be happy to answer this. We have this question raised many times. We have some people on the Hill that have some firm ideas on this, and they are on very important committees.

Mr. DEAN. This is not a new problem in reference to an option. It is a policy of CCC not to grant any kind of an option on any kind of a commodity that is owned or controlled by CCC.

The second thing is that we have a mandate from Congress, the House Appropriations Committee, to offer these commodities for sale in world markets on competitive bids.

The commodities that we offer on a fixed price are dairy products. I realize what Mr. Miller says. This Greek program of any program under title 1, Public Law 480, the purchaser buys from us on competitive bids. If Mr. Miller buys from us and he is high bidder and somebody else comes along and makes the sales to the Greeks under title 1, Public Law 480, he has his money in that lot of rice.

CCC turns the rice over to Mr. Miller after he bids. Mr. Miller desires to make a sale to Greece but by the time he gets ready to work with the Greeks, Mr. Gathings comes along with a cent or half a cent under Mr. Miller's negotiating price and Mr. Gathings makes the sale. Mr. Miller pays the carrying charges and the storage charges on the rice, not CCC, for he becomes the owner of the rice.

So Mr. Miller or anybody else takes those risks.

Mr. MILLER. Yes, sir. You are absolutely right, Mr. Dean, and that taking that risk is the compulsion to take that risk is what diminishes the chance of selling rice at export.

Mr. MCLAIN. I think it is a very fine statement but I would like to say this to you, Mr. Miller: I have been in the grain business all my life. If the Government wasn't in this at all, you would have to take this same risk. This risktaking is free enterprise. I think sometimes we get mixed up. We blame the Government sometimes for things they should not be blamed for. There is some hedging that you can

Let me say this to begin with, that I have many very fine friends in the rice industry and have been very close to some of them, and I think they are a pretty practical group of people. I think that they are interested in any long-term approach to the rice problem that should be helpful to you people that are charged, of course, with the responsibility of writing the laws that the Department must operate under.

So, with that, I will go ahead and read this brief statement. We have tried to get into it some of the facts that ought to be of interest to this committee.

I am happy to be here today to discuss with you the rice situation with special reference to the administration's recommendations for rice.

As one of the basic crops involving mandatory price support and acreage allotments determined by formula, we feel it most appropriate for this committee to consider the problems of rice and possible solutions. While we have taken many actions to assist rice producers, we recognize that all of the problems have not been solved.

ACTIONS TAKEN TO ASSIST RICE PRODUCERS

We recommended and the Congress enacted, in 1954, the Agricultural Trade and Development Act, commonly known as Public Law 480, to dispose of surpluses.

Under title I of this law, we have programed the export movement of about 252 million bags of milled rice. This is the equivalent of about 37 million hundredweight of rough rice.

Incidentally, unless action to extend Public Law 480 is taken soon, rice producers will lose some of the benefits which, otherwise, would be derivedf from title I of Public Law 480.

I am happy, may I say, to note that the House is going to move on hearings on Public Law 480. We have been successful in getting it through the Senate side, and I think it is to the interest of rice growers as well as wheat growers and many other growers that action be taken as soon as possible on it.

Under title II of Public Law 480 we have programed for donation to various governments 4.8 million hundredweight of rice-rough

basis.

We recommended and the Congress enacted, in 1956, the Soil Bank Act.

Under this law, rice producers have made and are making substantial reductions in acreage and have received or will receive total payments of about $28 million for the years 1956 through 1958.

We are providing supplies of rice for distribution to the schools under the school lunch program and to institutions. In the last fiscal year, we distributed 33 million pounds under this program.

We are making rice available for donation to the needy through various State outlets. In the last fiscal year, we distributed about 48 million pounds under this program.

We are sharing our abundance of rice with the needy abroad through various religious and charitable groups. In the last fiscal year, we distributed 201 million pounds under this program.

Under our barter authority, we have exported approximately one million hundredweight, rough basis.

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