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to pass Congress?" Mr. Rawlings replied that the add-on provision can be solidly defended since the resulting total would only be up to a maximum of 90 percent of parity, as compared to up to a maximum of 100 percent of parity in the case of certain other commodities. Mr. Rawlings and Mr. Griffin both stated that they felt this type provision is essential to secure grower votes for the bill. Discussion brought out that in the final analysis the cost of this proposed program is shifted from the Federal Government to the ultimate consumer.

Mr. Boyd suggested that each delegation go back home and sell the entire program as it presently stands in total. Mr. Braswell suggested that more work should be done by the group individually and possibly at a later meeting toward compromising points of disagreement.

Mr. Rawlings suggested that each area solidify a proposed bill encompassing the aspects desired; then present such a plan to the appropriate Congressmen for their study but not to be presented for a public hearing before a subcommittee. Mr. R. Wilson voiced agreement with Mr. Rawlings' suggested plan. Mr. Braswell stated that he again felt that any peanut bill must be a part of an overall farm plan. He is opposed, however, to agreeing that the bill not be introduced this season. He suggests, alternately, that the bill which each area comes up with, or an overall compromise for all areas, be put before an Agricultural Subcommittee with the definite understanding that it is not to be pushed out alone but is only to be a part of an overall farm bill.

Mr. Griffin again stated that he is definitely opposed to introducing any peanut bill this season for any public hearing.

It was agreed that representatives from each area would continue to work toward a desired proposed bill. If a meeting with the other two areas is desired in order to facilitate compromises, Mr. Rawlings is to be contacted relative to setting up a meeting. It was further suggested that insofar as possible the same personnel should attend each meeting so that all will be familiar with background discussions and provisions. It was lastly agreed that Mr. Rawlings, if and when a later meeting of all three areas is desired, will contact one person in each area relative to the meeting.

Ross WILSON, Acting Secretary.

1958 Letter No. 33

GEORGIA FARM BUREAU FEDERATION,

Macon, Ga., March 13, 1958. To: County officers in peanut producing counties and GFBF commodity com

mittee. From: Troy Barton, legislative director. Subject: Results of Peanut Meeting, Monday, March 10.

Upon call of the Georgia Farm Bureau, peanut producers from all over Georgia, with producer representatives from Florida and Alabama, met at Radium Springs to decide and chart a course of action on peanut legislation that may be introduced in this session of the Congress.

The GFBF has not proposed any legislation for this session but has had to give considerable thought and time to a proposed bill by the peanut and hog associations of Virginia and North Carolina. These two organizations have worked on a bill for the past 3 or 4 years which, from all study, seems to benefit their States more than other areas.

President Duncan presided at this meeting and opened by giving a brief report on meetings held recently and especially a meeting held in Washington relating to peanut legislation. He stated that everyone in attendance at the Washington meeting intimated that they could not go along with the Virginia and North Carolina proposal and everyone agreed it would be wise to call meetings hy States of producers to make final decision.

Mr. Duncan asked Steve Pace; Walter Randolph, president, Alabama Farm Bureau; Cyril Boyd, representing Florida Farm Bureau; H. B. Wilson, chairman, GFBF peanut commodity committee; J. H. Wyatt, secretary, GFBF peanut commodity committee; and D. W. Brooks, general manager, CPA, to discuss their opinions of any legislation or the proposed bill subject to be introduced anytime.

placed Mr. Brooks and his organization in the latter category. He stands in the place of his members individually and separately. And as such, we think, is entitled to price support in the same manner as extended to any individual. That is the way we generally extend price supports.

Mr. Poage. Mr. Miller, all I want to say is there are a lot of little irritants building up. And as far as I am concerned in the last 10 years the Department has not removed one of them. Obviously it is going to break the whole program down if it goes on as it is.

Mr. McMILLAN. To sum up this hearing, we would like to ask you, if possible, to see if you can give these people some assistance, and get together on this item where there is some controversy, getting the Southeast and Southwest on the same basis.

Any further questions?

Mr. ABBITT. Yes; I would like to ask him something now. In addition to the grades, I don't believe Congressman Poage went into the question about differential in price. I am vitally interested in that. And I am wondering if any real headway is being made in eliminating the differential in price between the various types of peanuts. think that is just vital to our industry if we are going to survive. And I don't see how our people can survive if the Department is going to maintain the position for this year that it has in the past. I am just wondering if any related way has been made in eliminating the discrimination in the differential!

Mr. MILLER. Mr. Abbitt, Mr. Thigpen has been conferring with the growers and associations of growers since we had a meeting with Mr. McLain and several members of the congressional committee some 6 or 8 weeks ago. Mr. McLain has been vitally interested in this subject. Mr. Thigpen can explain to what extent he has made progress, and as to how soon he thinks he might be able to come up with some recommendations. I won't ask him to divulge what they are at the present time because they are still subject to revision. But if he can give you a report as to what progress he has made, I think it would be good at this time.

Mr. ABBITT. It certainly would be helpful. I don't want him to disclose anything.

Mr. THIGPEN. Could I comment off the record ? (Discussion off the record.) Nr. THIGPEN. Howard Akers, who worked for a long number of years on price supports on peanuts, stated occasionally that many people held the view, and he tended to share it, that a pound of sound mature kernels was worth the same thing regardless of type. Now, that is a rather plausible kind of theory, and a way to look at the question. And I, myself, tended to feel that there was considerable merit to that point.

So when this suggestion was made at the discussion some weeks back by the people representing the Virginia-Carolina area, and in turn by the people representing the southwest area, that the matter be approached on that basis, we began digging into it as thoroughly as we could.

Our job on differentials actually would be easier if we could defend that position, specifically.

We have obtained some information in the past several weeks which we have not had heretofore, bearing on the question. Here

tofore we have, as a matter of necessity, almost, said that we would establish the price support differentials based on the historical price relationships as shown in the market place, and as compiled by the Department, because we had absolutely no other method that we could use that would let us calculate something that we could explain and defend.

Now, theoretically, too, generally speaking, the best test of price relationship is what is shown by the market over a period of years. Yet we realize that when price supports are in effect over a number of years, that perhaps you are sort of reading back into the mirror what you put there.

We are not yet ready-I am not yet ready-based on the analysis we have made thus far, to make a specific recommendation. I have some question as to whether the theory of the same SKM value is actually in line with market values.

Now, I might sidetrack for a moment and say that–by way of information—at the hearing, the recent hearing before this subcommittee, Mr. Reagan, of the Southwest, stated that the Southwest area wanted the same value assigned to each percent of SMK, that that had been done in such a way for 1951-55 that the value per percent of SMK for runners was the same as the value per percent of SMK for Southwest Spanish; that is true. But no consideration then was given to kernels other than sound mature kernels.

The net effect of it is that if we were to return to the same thing that was used in 1951–55, that the price of Southwest Spanish peanuts would be decreased relative to the price of runner peanuts.

And yet this gets to be a complex, difficult question. And I know no way of going at these things, except getting all the information we can, putting it in front of all the people interested, and seeing if we can get as nearly as posible a meeting of minds. On this one I am afraid we cannot get agreement in all areas. I am afraid we will be left with the responsibility for a decision, which, as I sometimes say, will leave people in each area about equally unhappy. No one with my disposition likes that. And yet that is what we have to go through.

I do think without question there has been 1 change in the last 2 or 3 years in terms of variety shifts in the Virginia-Carolina area which has modified the market value relationships for these large kernels of Virginia type and that some adjustment is needed there. Again I am not quite ready to say what I would think would be best or least bad on it.

Mr. ABBITT. When do you think we could reasonably expect to have a suggestion?

Mr. THIGPEN. From the Division standpoint, we want to come to some conclusion as to what we think before the end of the month.

Mr. MILLER. You see, the Department is just as anxious to come forth with a solution as you have expressed your desire that we do so. We will come up immediately with our recommendation.

Mr. ABBITT. I just want to reiterate how important and vital it is for the people in our area. I know if we are going to survive, we have got to have some substantial relief. I would hate to think that a great industry like ours would suffer.

effective price of the farm level on the consumption of peanuts is a study of 1952, a 1-percent cut in price of farm level that could only be expected to increase consumption by four-tenths of 1 percent. So you see how the farmer comes out when you carry that on for a few months.

Mr. ABBITT. What did you say the total reduction was that you take?

Mr. Rawlings. It is a combination of going from 90 percent of parity to 82 percent of parity plus a 10-percent further price cut on two 5-percent bites on modernized parity and we have got right near that much more to go on modernized parity at 5 percent a year.

I will tell you this. When you get through with modernized parity alone, it will take approximately some $40 a ton off the support price of peanuts if we still had a 90-percent program. That is approximately correct; isn't it, Steve?

Mr. Pace. Yes. It has been pretty heavy, that modernized parity.

Mr. Rawlings. I wanted to get that in the record. We are not up here asking for something we think is unreasonable or something we think we have to apologize to anybody about.

Mr. ABBITT. Mr. Chairman, I would just like to introduce the chairman of the Virginia ASC Committee, Mr. Delmar Carr. He doesn't care to make a statement, but he is from the peanut area and is doing a splendid job in his effort to help the farmers of Virginia.

Mr. McMILLAN. Stand up and give the reporter your full name and whom you represent.

Mr. ABBITT. And Mrs. Carr, his charming and gracious wife.
Mr. McMILLAN. We will be glad to hear you at this time.

Mr. Carr. Mr. Chairman and Mr. Abbítt, I want to thank you for the recognition. I have no statement. It is a pleasure to be here

Mr. McMILLAN. Thank you. You have a mighty good Congress

The committee will hold these hearings open for other meetings at a later date and consider all the statements that have been made here today. If we want to call you in later, we will certainly do it. We will certainly have a report from the Department sometime in the near future, and will take further action on this bill at a later date.

The committee will stand adjourned until the call of the Chair.

(The following statement was submitted to the subcommittee and without objection by the chairman is inserted in the record :)

with you.

man.

STATEMENT OF MARSHALL BALLARD, JR., PRESIDENT, AMERICAN TUNG OIL

ASSOCIATION

Mr. Chairman and honorable members of the committee, my name is Marshall Ballard, Jr., of Lumberton, Miss. I am president of the American Tung Oil Association, and a member of the board of directors of the National Tung Oil Marketing Cooperative and of the Tung Research & Development League. Membership in these three organizations produce two-thirds or more of the total United States production of tung oil annually. Like all other officers and directors of our three organizations, I am a tung grower; and like the great majority of tung growers, my life savings, and all that I have and own are wrapped up in the tung industry. I speak to you therefore not as a professional attorney, nor as a hired lobbyist, but as a plain farmer who will succeed or fail in the tung industry during the coming years.

At this time, I am serving as chairman of the committee on miscellaneous commodities of the National Conference of Commodity Organizations. Represented on my committee are such commodities as peanuts, tobacco, sugar,

naval stores, potatoes, fruits and vegetables, honey, and, of course, last but not least, tung. This Committee of the National Conference is more or less a coordinating committee for the various commodities just mentioned. I do not pretend to pose as an expert on all of the commodities represented on my committee. I understand that most of these commodity groups are offering specific legislative proposals on which their respective representatives will address you gentlemen in the course of these hearings. I, therefore, shall undertake to answer specifically only for tung.

The American tung oil industry is still relatively new. Our oldest producing commercial orchards are under 30 years of age and the great majority of tung trees are under 25 years old. The product of the tung tree is tung nuts and from tung nuts is expressed tung oil. Tung oil has unique and unduplicatable qualities for use in paint, varnishes, waterproof goods, printers' ink, and many other products. It was regarded as so essential to the domestic security during World War II that the entire domestic production was commandeered by presidential proclamation and was allocated only for strategic uses.

Tung oil is used by American industries to the extent of some 40 to 50 million pounds annually. Its production in the United States is limited by weather and soil requirements and is thus restricted to a belt about 50 miles wide near the Gulf Coast and extending from Texas to Florida. The American tung industry now produces from one-half to three-fourth of the Nation's requirements for tung oil annually. We feel sure that there is competent leadership in all phases of American agriculture to present their own problems and to propose solutions wbich are worthy of your most serious consideration.

As a still new agricultural industry, we studied with great interest the recent interim report prepared by the President's Commission on Increased Industrial Use of Agricultural Products. This Commission was created by Congress and instructed to make recommendations for such legislation as may be needed to increase the industrial utilization of new and familiar farm crops. The interim report by the Commission as you may recall, made a series of recommendations (1) for the introduction of certain new crops, (2) for an unparalleled program of research for developing the usage of new crops and established crops, and (3) to provide varied forms of financial support by the Federal Government until what was termed the "awkward period” for these new crops and new uses of established crops had passed,

The point we wish to stress here is that the tung industry is now in the "awkward period.”

We acknowledge with a great deal of gratitude our appreciation of the assistance of the Federal Government for its program of research to develop basic information on sound cultural and fertilization practices and the like for tung, all of which has been necessary to the efficient production of this new crop. We are most grateful, also, to the Southern Regional Research Laboratory at New Orleans for its studies on the chemical and physical structure of tung oil-all of this related, of course, to the extension of tung oil markets through the development of new uses. These services have been valuable, indeed, to our developing industry but are small indeed compared to what is proposed under the interim report to Congress referred to above.

Literally, gentlemen, the tung industry has been lifting itself by its own bootstraps beginning about 30 years ago. The present tung belt was then a vast area of cutover pineland. The farm population was small. The interior communities were small and were threatened with extinction as the sawmills cut out the timber and closed down and provided no remaining employment for the population. The soil in this particular area is not inherently fertile, although it is blessed by abundant year-round rainfall and a magnificent climate. Cotton had played out due to the coming of the boll weevil and for other reasons inherent to this area. Returns from corn production were meager; and the chief remaining source of income were the gaunt native longhorn cows and scrub sheep which ranged over the cutover pinelands-a very mediocre source of livelihood at best.

In this unpromising situation a group of farseeing men-beginning in Florida and gradually extending through Georgia, Alabama, Mississippi, and Louisianaconceived of tung as the one crop that would thrive best under our local circumstances. During the years that have followed, and until quite recently, the tung industry flourished. With it have developed also a thriving modern livestock industry, utilizing improved pastures, a large poultry industry and an even larger dairy industry, along with a very comprehensive reforestation program. As a result the general tung belt area has progressed to an amazing extent. But the basis for and hard core for all the progress farmwide in this particular area

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