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In view of the allotment situation under present law, this is of great significance to rice producers.
These changes will not solve all of the rice producers' problems overnight. However, they will be concrete steps forward in our long-range efforts to bring about a better balance between supply and demand.
Along with these changes, we have requested the Congress to further extend Public Law 480—to help maintain a good rate of rice exports.
Before concluding my remarks, may I urge your subcommittee to act with all speed possible on the President's recommendations.
We cannot afford to lose another year in our battle to bring about a better adjustment between supplies and need.
We need adequate tools to solve the rice problem. I firmly believe that we have the tools in the President's message.
We now shall be glad to answer any questions which your subcomumittee may have on the Department's recommendations.
I think that concludes what we would like say formally here.
I will ask Mr. Sorkin, Mr. Dean, and Mr. Miller, and Mr. Satterfield, whom you all know, plus our legal counsel, Mr. Schoonover, to help answer any question that you might have.
If you have any questions on the way we have handled our exports, we will be glad to give you that.
I would like to just again urge with all the spirit I have in me that we move on Public Law 480, because, if this legislation is delayed up until the close of Congress, it could seriously hurt the rice industry.
Mr. THOMPSON. I certainly agree with you, Mr. McLain. Let me just ask one little practical question. You know, of course, that we are in a situation in the Congress where we can kill almost any legislation, but we are having a terrible time ge ting almost any legislation passed in behalf of agriculture. It is a peculiar situation, but we might as well face it. That is the fact.
It is easy enough to kill a bill which we think is meritorious, and have difficulty to pass one.
If we pass one we think is meritorious, sometimes it is unfortunate enough to catch a veto when it gets downtown, but that is neither here nor there. We are trying now to deal objectively with the problem at hand.
What will happen to the rice industry if we don't succeed in passing the legislation that you suggest ?
Mr. McLAIN. I think it will be tragic if the acreage allotment dropped back to where it would under present legislation. Everyone in the rice industry that I respect thinks it would be disastrous. I don't think the industry could stand it. I think it would be unwise.
Mr. THOMPSON. You would have a cut in acreage of about how much?
Mr. McLain. It would be as we have indicated here in the statement. Our best estimate now would be around a million acres.
Mr. THOMPSON. Percentagewise, it is about how much?
Mr. Thompson. Between 35 and 40 percent. I agree with you they cannot stand it at all.
Now, in getting together the figures on which you base that particular acreage estimate, you take into consideration respective foreign sales?
feed prices. And then you hear from the corn people. You hear from the grain sorghum people. So we say, let's get it behind us. You want us to move it.
Mr. GATHINGS. Just one other thing. I hate to take up so much time, Mr. Chairman.
Here a few years ago we noticed on the Washington market here some broken rice in larger bags, 5- and 10-pound bags; I just wonder why you don't have those bags of broken rice for sale any more!
Mr. MILLER. Congressman, the mills offer broken rice for sale to the trade. Ordinarily it doesn't move well. Sometimes in perhaps times of depression, perhaps times of uncertain circumstances, you can sell some so-called second-heads, as they call them, or we have a brand we call Wonder Bits of rice which is second-heads which we offer in larger packages. But, frankly, they just, they are offered wherever the trade will buy them, but they are always available from the mills, and it is just that they won't move under certain circumstances.
Mr. GATHINGS. I had a letter from a fellow who had 7 children in his family and he said to me that he didn't want to buy a little old 1-pound package of rice; that he required a lot of rice for his folks. Mr. KRUEGER. He didn't want to discourage that. Mr. THOMPSON. Does that wind it up! Mr. GATHINGS. Yes.
Mr. THOMPSON. I want to have my committee members hear this, and this is only subject to your approval, gentlemen. I would like to have Judge Satterfield and Mr. LeMay, or whoever in our shop is the proper one to do it, to draw us up a little bill embodying the $64,000 question I submitted to Mr. McLain, remove the escalator clause and leave this price support where it is, leave the acreage where it is, for next year.
I don't know whether we ought to project it beyond that or not.
Mr. SATTERFIELD. Let me ask this question, Congressman: I don't know whether you know of the rice industry group's testimony in the Senate here a couple of months ago in which all of the witnesses testified to the effect that they felt that the whole, both milling industry and producer groups, would go along with not a removal of the escalator clause, but suspension of it for 2 years—I mean 3 years, for an extension of the present acreage for 2 years.
Now, do you want this bill drafted-
Mr. THOMPSON. I don't care; whichever is the more proper thing. Probably suspension.
Mr. SATTERFIELD. This was their testimony.
Mr. GATHINGS. I believe that some of these other commodities are planning on a 3-year program.
Mr. THOMPSON. Three-year suspension.
Mr. GATHINGS. Yes, 1959 through 1960 and 1961. Most of those programs are being considered now and cover 3 years.
Mr. THOMPSON. Let's leave it, then, to the General Counsel. I think that is the place to leave it and make it fit the rest of the program, so far as possible. But I would like to have it in bill form and submit it to the rice industry. Let them look at it and see what they think.
Can we do that?
Mr. McLAIN. We have all kinds of tables submitted to the Board, Mr. Chairman, on all of these commodities.
This is one of the difficulties that you have, even in determining acreage allotments or price support.
Of course, it all depends on the set of facts that you want to use. depends almost completely on how much added funds you get in Public Law 480 and the proportion used for rice or how much rice you give away.
We probably had several different sets of figures. We do generally with most of these commodities.
The fact is that many times we have them set up a table with different set of figures in order to give us a picture of what the results would be.
I would say, however, that the decision that was made was based on what we thought was fair and reasonable to rice, as compared to other commodities. I think the figures will back us up on that.
Mr. THOMPson. The 19 million hundredweight figure would have left rice in substantially the same position that it is now?
Mr. McLAIN. It wouldn't change it materially.
Mr. THOMPSON. And the figures that were then arbitrarily set would put the rice industry to a considerable extent, out of business?
Mr. McLain. I think you would put it the other way, if you put it at 19 million, it would change the level of price support a little.
Mr. THOMPSON. It would increase it a little.
Mr. THOMPSON. But instead of using a set of figures that would leave the rice industry substantially in status quo, at least for planning purposes, we arbitrarily take a set of figures that would put them out of business?
Mr. McLain. I think we have ample proof that if you look at the Public Law 480 funds used for rice, you would agree that we have treated rice fairly.
Mr. Thompson. Possibly so; we haven't run into them yet.
The State Department tells us that they would like to have more rice for sale in India, Pakistan, I think, and Indonesia, and they say that they have put in the request for additional rice.
If that rice were developed, the surpluses, by the end-what is it, the end of July when we start the thing, the 1st of August, those surpluses would be practically gone.
Mr. McLain. I think rice is the one commodity that if we would program, and out of proportion amount of funds available and under 480 we could probably find an outlet for all of it.
Mr. Thompson. Why not do it rather than put the rice industry out of business or put so much of the rice industry out of business?
Mr. McLAIN. Your area of the country, and all you good gentlemen here, have crop interests other than rice. We have to look at all commodities, as required by law.
We don't think the law intends that a disproportionate share of the funds should be used for any one commodity.
We have many of these commodities that are in the surplus situation. The cotton allotment coming up is going to be much below the present minimum. Wheat would be down, if it didn't have a minimum permanently on the statute books, to around 20 million acres instead
PRICE SUPPORT PROVISION
SUBCOMMITTEE ON PEANUTS
COMMITTEE ON AGRICULTURE
H. R. 11098, H. R. 12224, H. R. 12545, and
H. R. 12566
COMMITTEE ON AGRICULTURE
HAROLD D. COOLEY, North Carolina, Chairman
W. R. POAGE, Texas, Vice Chairman GEORGE M. GRANT, Alabama
WILLIAM S. HILL, Colorado E. C. GATHINGS, Arkansas
SID SIMPSON, Mlinois JOHN L. MCMILLAN, South Carolina PAUL B. DAGUE, Pennsylvania THOMAS G. ABERNETHY, Mississippi RALPH HARVEY, Indiana CARL ALBERT, Oklahoma
PAGE BELCHER, Oklahoma WATKINS M. ABBITT, Virginia
CLIFFORD G. MCINTIRE, Maine JAMES G. POLK, Ohio
WILLIAM R. WILLIAMS, New York CLARK W. THOMPSON, Texas
ROBERT D. HARRISON, Nebraska PAUL C. JONES, Missouri
HENRY ALDOUS DIXON, Utah JOHN C. WATTS, Kentucky
WINT SMITH, Kansas HARLAN HAGEN, California
OTTO KRUEGER, North Dakota LESTER R. JOHNSON, Wisconsin
CHARLES M. TEAGUE, California VICTOR L. ANFUSO, New York
DONALD E. TEWES, Wisconsin ROSS BASS, Tennessee
ALBERT H. QUIE, Minnesota COYA KNUTSON, Minnesota
E. L. BARTLETT, Alaska
JOHN A. BURNS, Hawaii
A. FERNÓS-ISERN, Puerto Rico
JOHN J. HEIMBURGER, Counsel
SUBCOMMITTEE ON PEANUTS
JOHN L. MCMILLAN, South Carolina, Chairman GEORGE M. GRANT, Alabama
ROBERT D. HARRISON, Nebraska CARL ALBERT, Oklahoma
PAGE BELCHER, Oklahoma WATKINS M. ABBITT, Virginia
WINT SMITH, Kansas