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These other countries have trade responsibilities. But when we offer them rice at competitive prices in the world market, I think they will buy all of our surplus.
Now, all we have to do is to complete working out the details. The Department made a wonderful stride in disposing of our surpluses and wonderful strides in working out these programs.
I respectfully submit that we can go further than they have done simply, not to help us-we don't want help-we just want to be in a position where we know what we are doing-so that we won't have to take that risk that Mr. Dean points out of buying a cargo of rice with the anticipation of selling it over here somewhere and finding ourselves stuck with it and being under the compulsion to export it.
You see, you have to export it. You can't sell it in the domestic market. Sometimes it is very difficult to find a place to export it. When you have a large quantity on hand, that is.
Mr. GATHINGS. You mentioned the promotion of rice sales in this country. I just wondered what you think about that program in the next 5 or 10 years.
Mr. MILLER. I think that it will double the consumption of rice in the United States in the next decade. I think it will take 10 years to do it, but I think we can double the consumption, the per capita consumption of rice in the United States by a well-planned program. Mr. GATHINGS. Would that well-planned program provide for some type of checkoff. How would you think that the various segments of the rice industry should pay for such a program?
Mr. MILLER. We think there should be a checkoff; we hope that it can be finally realized. The Arkansas rice farmers are very strong in their support of promotional work. The Texas rice farmers are very strong in their support.
Mr. GATHINGS. Right.
Mr. MILLER. There hasn't been quite as much support in Louisiana, nor in Mississippi has there been as much as in Arkansas and Texas. The Arkansas people led the movement, and the Texas people were also leaders in the movement.
Now, in those areas, certainly, there is strong probability that the producers would be willing to have a checkoff system. The Louisiana people have very strenuously resisted a checkoff system. And that is where we stand today.
We are conducting educational campaigns in Louisiana areas in the hope that we can acquire, get their acquiescence, and if we can, then we would be in a position to put in a checkoff system in all probability. Mr. THOMPSON. In Texas, it is virtually a checkoff system now, isn't
Mr. MILLER. It works to that effect, Congressman.
Mr. THOMPSON. It is ninety-odd percent.
Mr. MILLER. He has done a great job, yes he has, certainly has. Mr. THOMPSON. Our time is running out.
Mr. GATHINGS. If you are winding up, Mr. Chairman, I would just like to ask Mr. McLain: Do you recall receiving a letter from me recently about some negotiations with respect to rice produced in California as against southern rice?
Mr. McLAIN. Yes, sir.
Mr. GATHINGS. Time is running out and all that, but I would like to get your attitude.
Mr. DEAN. This 1,400,000 hundredweight of pearl rice is from the 1956 crop in California which is the result of the industry not moving, going ahead and putting the rice in Japan for dollars. This rice is the 1956 crop rice, and it is pearl rice. The only home normally for rice on the west coast is to Japan.
Since this crop was taken over in 1956, we have taken over, as I indicated earlier this morning, 2 million hundredweight from the 1957 crop in California, and another crop will be coming along for harvest in September. We put this 1,400,000 hundredweight up for barter, and restricted it only to the 1.4 million pearl type.
We held back Calrose rice in California because we think we can move it for dollars, as it is a long-grain rice. So what we were attempting to do by bartering this surplus rice in California was giving it equal treatment with the relatively small quantity of pearl rice which you have in the South. We think we can move the pearl rice out of the South for dollars without any help from a barter program. We were very specific to tie down the barter program for only that quantity of price.
Mr. GATHINGS. You realize, though, by virtue of just earmarking California rice, that the ears pop up all over of these other States that grow rice?
Mr. DEAN. Mr. Carter called me the day the press release went out. He raised the same question. I pointed out to Clyde as well as I could the amount of assistance we have given to rice, not only the rice producer in Arkansas, but the rice milling industry since 1953.
So what we were attempting to do with this relatively smaller quantity in California was to give it equal treatment with the southern rice.
We look at the rice problem as a whole, not State by State. We have been paying carrying charges on this rice in California for over 2 years, and we have got to move it. So our best opportunity for attempting to move it, since we can't move it for dollars, is to try to move it for barter.
If we had the same problem in the South, on the old crop-keep in mind that in the South we have no rice from the 1953 crop. It is gone. We have no rice from the 1954 crop; it is gone.
We have no rice from the 1955 crop; it is gone. So what we have left in the South is a relatively small quantity of 1956, plus the 10
million we took over in March.
Mr. GATHINGS. We are anxious, though, to keep our customers, and we are hopeful that you will continue to look at it as a national problem, of course.
Mr. DEAN. We would say this, Mr. Gathings, that if you had some old-crop rice in the South, we would work it off either through barter, try it through barter-it is old-crop rice that is the only reason we put it up under the barter program, because we see no other opportunity for movement, and we would certainly do that in any State where we had old-crop commodities.
Mr. GATHINGS. Whether barter or otherwise, we have tried to dispose of it and the storage is an appreciable item. In any eventMr. DEAN. The rice in California is 1,400,000 hundredweight and if it goes out of condition, which it could do, then what do we do? We throw it immediately on the domestic market for feed, and break
feed prices. And then you hear from the corn people. You hear from the grain sorghum people.
You want us to move it.
So we say, let's get it behind us. 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. Draw it that way.
Mr. SATTERFIELD. Suspension of it, or repeal of it?
Mr. THOMPSON. I don't care; whichever is the more proper thing. Probably suspension.
Mr. SATTERFIELD. This was their testimony.
Mr. SORKIN. We would prefer complete elimination.
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. SATTERFIELD. Mr. Schoonover is from the General Counsel's Office.
Mr. SCHOONOVER. We can work it out.
Mr. THOMPSON. All right.
Now, customarily we ask all those present if there is anyone else who wants to testify. It is late, but if there is anyone who wants to get something in the record, with the consent of my committee members, we will give them an opportunity to place it in the record at this point as their statement, or if they would like to be heard from, we will hear from them briefly now.
Mr. GATHINGS. I think that is a good suggestion, Mr. Chairman. It may be that some of them might have a table or some other information that they feel would make this record complete.
Mr. THOMPSON. Without objection, pertinent tables may be submitted in the record at this time.
Also, without objection, all testimony may be reviewed by the witnesses for grammatical corrections and so forth. We don't generally try to alter any factual information, but it may be edited, if you so desire, and if so, Mr. LeMay will arrange for it.
The record will be held open briefly for any of these submissions; it will be held open for a reasonable time.
We seem to have wound this up at exactly the right moment because there goes the bell.
Thank you very much for attending, gentlemen.
The committee stands adjourned subject to further call.
(Without objection by the chairman, the following letter has been inserted in the record :)
AMERICAN RICE GROWERS COOPERATIVE ASSOCIATION,
Hon. CLARK W. THOMPSON,
Lake Charles, La., April 28, 1958.
Old House Office Building, Washington, D. C.
DEAR CONGRESSMAN THOMPSON: It is my understanding that your House Agriculture Committee will begin hearings tomorrow with respect to a continuing attempt to develop agricultural legislation during this session of Congress. This is to suggest to you that I, acting as chairman of the Rice Program Development Committee representing all rice producing States, would recommend the following legislation for rice as being acceptable to the industry and a possible compromise of the disastrous impasse which now faces us and which would be acceptable to the administration:
1. Suspension of the escalator clause with respect to the level of price support for rice for a period of 3 years.
2. A minimum increase of 10 to 15 percent in rice acreage allotments over the present 1,652,596 acres with the total allotment to be allocated on exactly the same basis as it is now distributed to the States, counties, and producers. 3. The level of rice price support to be at the discretion of the Secretary of Agriculture at not less than 75 percent or more than 90 percent of parity. We believe that the above suggestions would provide a workable opportunity to indicate whether the program suggested by the Secretary of Agriculture will do the job anticipated and it will at the same time allow the Secretary to administer the present surplus without running the risk of artificially increasing the level of price support and possibly the acreage allotment in this or future years by the surplus disposal program.
GEORGE B. BLAIR, General Manager.
(Whereupon, at 12: 15 p. m., the hearing of the subcommittee was adjourned, subject to call.)
PRICE SUPPORT PROVISION
SUBCOMMITTEE ON PEANUTS
COMMITTEE ON AGRICULTURE
H. R. 11098, H. R. 12224, H. R. 12545, and H. R. 12566
MARCH 26, MAY 15, 27, AND JUNE 9, 1958
Printed for the use of the Committee on Agriculture