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CONTENTS

H. R. 11098. A bill to amend the Agricultural Adjustment Act of 1938

with respect to acreage allotments for cotton and peanuts....

H. R. 12224. A bill to amend the Agricultural Adjustment Act of 1938,
as amended, with respect to acreage allotments for peanuts_

Statement of—

Matthews, Hon. D. R. (Billy), a Representative in Congress from the

eighth district of Florida....

Merrill, James W., chief, Production Program Branch, Oils and

Peanut Division, Commodity Stabilization Service, United States

Department of Agriculture; accompanied by James E. Thigpen,

director, Oils and Peanut Division..

Miller, Clarence L., associate administrator, Commodity Stabilization

Service, United States Department of Agriculture; accompanied

by J. E. Thigpen, director of Oils and Peanut Division, CSS, USDA;
James W. Merrill, chief, Production Program Branch, Oils and
Peanut Division, CSS: W. K. Schoonover, attorney, Office of the
General Councel, USDA; and Richard B. Bridgforth, assistant
deputy administrator, CSS, USDA.

Additional data submitted to the subcommittee by-
Matthews, Hon. D. R.:

Department of Agriculture, Washington, D. C., Hon. True D.
Morse, acting secretary, letter of March 14, 1958.

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Mr. GATHINGS. That goes to show the importance of the Public Law
480 program that was pointed up here by Secretary McLain this
morning.

Mr. DEAN. Because funds were available under title I, Public Law
480.

Title 2, Public Law 480, 558,000 hundredweight, which is another
type of Government assistance program.

Section 402, ICA, none, and donations, 416; 2,915,000 hundred-
weight is foreign donations.

The total from CCC inventory in export is 20,762,000 hundred-

weight.

Mr. DEAN. I will be happy to leave a copy of this table with you.
Mr. THOMPSON. I think it would be very valuable if you would.
(The table referred to is as follows:)

TABLE I.-Dispositions of CCC-owned rice in fiscal years 1957 and 1958,
by programs, March 19, 1958

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PEANUT ACREAGE ALLOTMENT

WEDNESDAY, MARCH 26, 1958

HOUSE OF REPRESENTATIVES,

COMMODITY SUBCOMMITTEE ON PEANUTS

OF THE COMMITTEE ON AGRICULTURE,

Washington, D. C.

The subcommittee met, pursuant to notice, at 10:45 a. m., in room 1310, New House Office Building, Hon. John L. McMillan (chairman of the subcommittee) presiding.

Present: Representatives McMillan (presiding), Abbitt, and Smith. Also present: Representatives Gathings, Matthews, Hagen, and Mabel C. Downey, clerk.

Mr. MCMILLAN (presiding). The committee will come to order. The committee has met this morning for the purpose of considering a bill introduced by Congressman Matthews of Florida, H. R. 11098. (H. R. 11098 is as follows:)

[H. R. 11098, 85th Cong., 2d sess.]

A BILL To amend the Agricultural Adjustment Act of 1938 with respect to acreage allotments for cotton and peanuts

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 344 of the Agricultural Adjustment Act of 1938, as amended (7 U. S. C. 1344), is amended by adding at the end thereof the following new subsection:

"(n) The planting of cotton on a farm in 1957 or any subsequent year for which no farm acreage allotment was established shall not make the farm eligible for an allotment as an old farm under provisions of this section: Provided, however, That, by reason of such planting, the farm need not be considered as ineligible for a new farm allotment under provisions of this section."

SEC. 2. Section 358 of the Agricultural Adjustment Act of 1938, as amended (7 U. S. C. 1358), is amended by adding at the end thereof the following new subsection:

"(i) The production of peanuts on a farm in 1957 or any subsequent year for which no farm acreage allotment was established shall not make the farm eligible for an allotment as an old farm under subsection (d) of this section: Provided, however, That by reason of such production the farm need not be considered as ineligible for a new farm allotment under subsection (f) of this section, but such production shall not be deemed past experience in the production of peanuts for any producer on the farm."

Mr. MCMILLAN. We have with us Mr. James W. Merrill and Mr. James E. Thigpen from the Department of Agriculture. Will you move up to the witness stand?

We would like to hear the Department's views on this legislation. Mr. Matthews has indicated that he will make a statement or submit one for the record after the Department has spoken.

STATEMENT OF JAMES W. MERRILL, CHIEF, PRODUCTION PROGRAM BRANCH, OILS AND PEANUT DIVISION, COMMODITY STABILIZATION SERVICE, UNITED STATES DEPARTMENT OF AGRICULTURE; ACCOMPANIED BY JAMES E. THIGPEN, DIRECTOR, OILS AND PEANUT DIVISION

Mr. THIGPEN. Thank you, Mr. Chairman. I would like to make a short statement first.

I believe that the problem here arises out of the situation which has existed on peanuts in recent years and which relates itself to the war, when the acreage of peanuts was roughly doubled at the request of the Department to provide peanuts for the production of oil. After the war that acreage was reduced by approximately half; the allotments by States are, I might say, frozen by existing legisla

tion.

With the price support for peanuts the crop is attractive to the farmers in the areas in which it is grown and consequently there is an effort on the part of farmers to increase their production or to get new allotments.

Under existing legislation a farmer can plant peanuts without an allotment and the next year he becomes eligible for some allotment, or the farm becomes eligible for some allotment as an old farm.

To the extent that allotments are established in such case the acreage involved must be taken away from the other farmers who have been growing peanuts for a longer period of time and who already have allotments. That creates a rather difficult situation on the part of these farmers who had their acreages cut by half after the war. The Department, even though this acreage is reduced by half, still is faced in most years with some surplus coming from the minimum total allotment which is fixed by law and the diversion of that surplus is a relatively costly item.

The change proposed here would prevent a farmer from planting without an allotment in a given year and then obtaining an allotment as an old farm in the next year.

It would not, however, prevent that farmer from obtaining an allotment as a new farmer. It would prevent a consideration of acreage grown without allotment as experience in establishing allotment for a new farm.

I believe that is all that I care to say at the moment.
Mr. MCMILLAN. Thank you. Any questions?

Mr. GATHINGS. Mr. Chairman, I wonder if this gentleman from the Department would give us some information with respect to the reductions that the growers in peanuts have to take as the result of the fact that these people who plant small acreages in peanuts get the old-farm status and are permitted to get a little of that acreage which is taken away from those other farmers in the county. I just wondered how that affects these old growers who, I should think, grow more peanuts than the one with the smaller acreage.

Mr. THIGPEN. Mr. Merrill, I believe you have the figures on that. Mr. MERRILL. I do not have the exact figures on the subject. I think however that I can point out pretty generally how it has affected them in the past.

Now, that varies tremendously by States.

Mr. McLAIN. All we say to you is, in all honesty, that we think that would be a major step, if that could be done.

Mr. THOMPSON. Maybe it can be; maybe it can't.

As I say and I cannot speak for them

Mr. MCLAIN. I have talked to people I respect very much in the industry, and you gentlemen have, too, that they are willing to accept that right now.

Mr. THOMPSON. Legislation is a give-and-take proposition. Where you have it at one end of the avenue, somebody who says it will be this and nothing else, it is awfully hard to get 435 men to agree to go along with any such thing as that.

Mr. McLAIN. We just haven't said that in this instance. I tried to give you a little indication.

Mr. THOMPSON. Reading from the President's veto message, it says: When the Secretary of Agriculture has been given these authorities to adjust price support, acreage allotments, he will set the 1959 allotment at levels at least as high as those in this year for cotton and rice-these allotments will be substantially above the levels which would otherwise prevail.

He goes on to say that when necessary, a new authorization is provided in keeping with my "legislative recommendations," the special export program for our surplus crops will be enlarged.

Opportunities exist to export both for dollars and, through special programs, large quantities of our stable commodities.

I have been trying to interpret that ever since I first read it. I am not sure that I know yet exactly what it means.

In some ways it is very clear, and in some ways there is a veiled threat in there or bribe-I don't know which-but, certainly, I interpret it as one or the other, at times.

I would surely like to know exactly what he had in mind.

Mr. MCLAIN. I think it is very simple to figure out what he had in mind.

Mr. THOMPSON. Giving exactly the program he says, and then he will give you a living acreage.

Mr. McLAIN. No; he recognizes, as the Secretary of Agriculture recognizes and certainly I recognize that legislation isn't always exactly as any one individual wants it. We recognize that.

But I think there ought to be some steps taken in the direction of what he has asked for. I think the rice industry is willing to accept much of what he has asked for. The fact is, I am sure they are.

Mr. SORKIN. I think the reference to increased exports refers to the fact that the President recommended a billion and a half for Public Law 480 compared with a billion available this year. There is a 50 percent increase requested in those funds.

Mr. THOMPSON. Mr. Krueger, I have neglected you this morning. Mr. Krueger is one of the best consumers of rice we have and he has been extremely interested and a usefuly member of this committee. Mr. KRUEGER. Thank you, Mr. Chairman.

Not knowing much about the rice industry or rice growing, I might have some very simple questions. They may sound simple to you, but I would like to clear up the situation for myself.

You say you have a carryover at the present time of 19.1 million hundredweight?

Mr. McLAIN. Yes.

Mr. KRUEGER. Is that a normal or abnormal carryover?

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