A second resolution which has a bearing on the proposals before this
committee, states that-

price-support levels should take account of competitive conditions, supply and
demand, and market trends.

As we look at the situation facing peanut producers today, we see
several trends which should be considered in the development of future
policies. A recent publication of the United States Department of
Agriculture which came to our attention showed that the 1957 acreage
of peanuts in the United States had decreased to 94 percent of the
1935-39 average, while the world production in 1957 stood at 164 per-
cent of the 1935-39 average.

Due to our increase in yields per acre in the past 20 years, produc-
tion of peanuts, however, showed a somewhat different picture, with
United States production increasing to 127 percent of the 1935-39
average, while at the same time the world production was increasing
to 152 percent.

While it is not our contention that the relative loss of production in
the United States, when compared to the world production of peanuts,
should be an overriding factor in our decisions, yet these facts should
be borne in mind when we consider policies affecting peanuts. All of
agriculture and peanut producers in particular should well consider
whether it is in their best interests to allow this gap to become wider
or should we take steps to restore to the American peanut producer the
opportunity to regain his historical portion of the world market.

However, it may well be in the best interests of our peanut producers
and of agriculture in general to confine our efforts to supplying the
domestic market without regard to world demands. We feel that
peanut producers, through their representative organizations and
legislators, should carefully consider these facts and take such steps
as are necessary to protect their own best interests.

Referring specifically to some of the proposals in the legislation
under consideration, we support the provisions which increase the
carryover of peanuts for the purposes of definition of "normal supply"
from 15 to 25 percent of the estimated domestic consumption, plus
estimated exports. The purpose of this section is to have the peanut
program more nearly conform to current practices in the industry and
in this matter we are in agreement.

The above Farm Bureau resolution also calls for support of the
amendment to the Agricultural Act of 1938, as amended, to exclude
from total carryover computations the peanuts held by CCC and con-
sider only those peanuts held in commercial channels for purposes of
determining the supply of peanuts and calculating the supply per-
centage.

We feel that the technological advances in the production of peanuts
have created a condition whereby the yield per acre has been increased
to the point that in a normal year the present national minimum
acreage allotment of peanuts will produce more than the requirements
of the industry at the price level established under the law.

We, therefore, feel that the reduction in the minimum national
acreage allotment is justified. We commend the peanut producers
for recommending such an adjustment in the peanut program in view
of the cost to the taxpayer for those peanuts produced over and above
the market requirements. While the recommended reduction in the

FAMILY FARM INCOME IMPROVEMENT

THURSDAY, MARCH 27, 1958

HOUSE OF REPRESENTATIVES,
COMMITTEE ON AGRICULTURE,
Washington, D. C.

The committee met pursuant to notice at 10 a. m., in room 1310, New House Office Building, Hon. W. R. Poage presiding.

Present: Representatives Poage, Gathings, McMillan, Albert, Abbitt, Thompson, Jones, Watts, Hagen, Johnson, Anfuso, Bass, Knutson, Jennings, Hill, Simpson, Dague, Belcher, McIntire, Williams, Dixon, Smith, Teague, Tewes, and Quie.

Also present: John Heimburger, counsel, Mabel C. Downey, clerk. Mr. POAGE. The committee will please come to order.

The committee is meeting this morning to consider bills introduced by Hon. George McGovern who introduced H. R. 10966 and Hon. James Roosevelt, who introduced H. R. 10967.

(H. R. 10966 and H. R. 10967 are as follows:)

[H. R. 10966, 85th Cong., 2d sess.]

A BILL To establish a comprehensive family farm income improvement and protection program, to provide additional consumer safeguards, to enable farmers to keep market supplies of farm commodities in reasonable balance with demand therefor, and for other purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That this Act shall be known as the "Family Farm Income Improvement Act of 1958".

SECTION 1. Section 101 of the Agricultural Act of 1949, as amended, is amended by adding at the end thereof the following: "Notwithstanding any other provision of law, the Secretary of Agriculture and the Federal Farm Income Improvement Board, established by this Act, are authorized and directed to maintain through price-supporting loans, purchases and purchase agreements; parity income deficiency payments; or other methods the returns to farmers who stay within applicable farmwide, commodity-group, and individual-commodity marketing quota and if producers of the commodity or commodity-group have not disapproved the proclamation of marketing quotas for that commodity or commodity-group, at a level not in excess of the parity-income equivalent prices of the several commodities nor less than 80 per centum of the parity-income equivalent prices of the several commodities: Provided, That the eligibility of any farmer to obtain farm income protection under this section shall be limited to not more than actual sales by such farmer or the maximum sales of economically adequate family-operated farms as determined for each type-of-farming area or subarea or other type-of-farming classification, by the Secretary upon affirmative recommendation by two-thirds vote of the Federal Farm Income Improvement Board, whichever is smaller; and the eligibility of any farmer to obtain farm income protection for any commodity shall be limited to actual sales of such commodity by such producer or the proportional part of the sales of such commodity by such producer that is equal to the ratio that total maximum sales of economically adequate family-operated farm bears to the total sales of all farm commodities by the producer, whichever is smaller: And provided further, That no farmer shall be eligible to receive more than $3,500 of parityincome deficiency payments in any one calendar year."

[H. R. 10967, 85th Cong., 2d sess.]

A BILL To establish a comprehensive family farm income improvement and protection program, to provide additional consumer safeguards, to enable farmers to keep market supplies of farm commodities in reasonable balance with demand therefor, and for other

purposes

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That this Act shall be known as the "Family Farm Income Improvement Act of 1958".

SECTION 1. Section 101 of the Agricultural Act of 1949, as amended, is amended by adding at the end thereof the following: "Notwithstanding any other provision of law, the Secretary of Agriculture and the Federal Farm Income Improvement Board, established by this Act, are authorized and directed to maintain through price-supporting loans, purchases and purchase agreements; parity income deficiency payments; or other methods the returns to farmers who stay within applicable farmwide, commodity-group, and individual-commodity marketing quota and if producers of the commodity or commodity-group have not disapproved the proclamation of marketing quotas for that commodity or commodity-group, at a level not in excess of the parity-income equivalent prices of the several commodities nor less than 80 per centum of the parity-income equivalent prices of the several commodities: Provided, That the eligibility of any farmer to obtain farm income protection under this section shall be limited to not more than actual sales by such farmer or the maximum sales of economically adequate family-operated farms as determined for each typeof-farming area or subarea or other type-of-farming classification, by the Secretary upon affirmative recommendation by two-thirds vote of the Federal Farm Income Improvement Board, which ever is smaller; and the eligibility of any farmer to obtain farm income protection for any commodity shall be limited to actual sales of such commodity by such producer or the proportional part of the sales of such commodity by such producer that is equal to the ratio that total maximum sales of economically adequate family-operated farm bears to the total sales of all farm commodities by the producer, whichever is smaller: And provided further, That no farmer shall be eligible to receive more than $3,500 of parity-income deficiency payments in any one calendar year."

PARITY-INCOME EQUIVALENT PRICE FORMULA

SEC. 2. The Agricultural Adjustment Act of 1938, as amended, is amended as follows:

(a) Section 301 (a) (1) is repealed.

(b) Section 301 (a) (2) is amended by changing "(2)" to "(1)" and adding at the end thereof the following: "The parity-income equivalent price of any agricultural commodity shall be a price per unit that when multiplied by the marketing quota or expected sales for such commodity plus estimated volume of such commodity utilized on farms where produced will equal the parity gross income for such commodity."

(c) Section 302 (f) of Public Law 897, Eightieth Congress (7 U. S. C. 1301a), is amended by inserting after the word "parity" the last time it appears and before the word "prices" the last time it appears the words "income equivalent”.

BALANCING MARKET SUPPLIES WITH DEMAND

SEC. 3. Notwithstanding any other provision of law, the Secretary and the Federal Farm Income Improvement Board, established by this Act, are authorized and directed to initiate the programs provided in this section to enable farmers to keep the market supply of the commodities they produce in reasonable balance with demand.

(a) The Secretary is authorized and directed upon recommendation adopted by two-thirds vote of the Federal Farm Income Improvement Board, established by this Act, to determine and proclaim, prior to October 15 of each year, a national farmwide all-commodity farm marketing quota for the succeeding crop year.

(1) The national farmwide all-commodity farm marketing quota shall be the total value of all farm commodities, calculated at parity-income equivalent prices, as the Secretary and the Federal Farm Income Improvement Board may determine can be sold by farmers at not less than 80 per centum of parity-income equivalent prices in such crop year calculated on the assumption that the number

of unemployed in such year will be not greater than 3 per centum of the total civilian labor force.

(2) The Secretary shall conduct a referendum of farmers to determine whether they favor or oppose the national farmwide all-commodity marketing quota proclaimed under this subsection not later than thirty days after issuance of the proclamation. Persons eligible to vote in the referendum shall be persons engaged in the production of farm commodities for sale in the year in which the referendum is held, or the next preceding year. If more than one-half of the farmers voting in the referendum oppose the quota, such quota shall become ineffective upon proclamation of the results of the referendum held hereunder within fifteen days after the date of such referendum.

(b) The Agricultural Marketing Agreement Act of 1937, reenacting, amending, and supplementing the Agricultural Adjustment Act, as amended, is amended as follows:

(1) Subsection 2 (1) is amended by striking the words "parity prices" and substituting in lieu thereof the words "parity-income equivalent prices".

(2) Subsection 8 (c) (2) is amended by inserting after the word "soybeans" the following: "other field crops, Irish potatoes, farm forestry products, cattle, hogs, lambs, milk for manufacturing, buterfat in cream, eggs, and poultry".

(c) Notwithstanding any other provision of law, the Secretary and the Federal Farm Income Improvement Board are authorized and directed, whenever neither a marketing agreement nor order under provisions of the Agricultural Marketing Agreements Act of 1937 is in effect for such commodity to proclaim a national individual-commodity marketing quota for such commodity and a commoditygroup marketing quota for economically related groups of such commodities, for any of the following commodities: (i) field crops (other than tobacco), including corn, both inside and outside the commercial corn producing area, barley, oats, rye, grain sorghum, flaxseed, soybeans, dry edible beans, and grass seeds; (ii) vegetables, including potatoes, cabbage, and tomatoes; (iii) fruits, including citrus fruits, dried fruits, and deciduous fruits; (iv) tree nuts, including English walnuts and pecans, (v) livestock, including hogs, cattle, and lambs; (vi) poultry, including chickens and turkeys; (vii) whole milk, butterfat, eggs, hops, honey, honeybees, and gum naval stores or any regional or market classification of such commodities.

(1) The national commodity-group or individual-commodity marketing quota shall be in the case of the individual-commodity quota the volume of the commodity, and in the case of a commodity-group marketing quota, the total value of all such commodities calculated at parity-income equivalent prices, that the Secretary determines, upon recommendation by two-thirds vote of the Federal Farm Income Improvement Board, is the volume of such commodities that can be sold by farmers through normal channels of trade during such marketing year, with such calculations based upon the assumption that the number of unemployed will not exceed 3 per centum of the civilian labor force, at prices not less than 80 per centum nor more than 100 per centum of the parity-income equivalent price for such commodities.

(2) The proclamation of a national commodity-group or individual-commodity marketing quota for any agricultural commodity or group that includes any commodity that is planted annually shall be made not less than sixty days prior to the beginning of the marketing year. A national single-commodity or commodity-group marketing quota may be made applicable to a crop or to a marketing year.

(3) The Secretary shall conduct a referendum of farmers to determine whether they favor or oppose the national commodity-group or individual-commodity marketing quota proclaimed under this subsection not later than thirty days after issuance of the proclamation. Persons eligible to vote in the referendum shall be farmers engaged in the production for sale of the commodity, in case of the individual-commodity marketing quota, or in production for sale of one or more of the commodities included, in case of a commodity-group marketing quota, in the year in which the referendum is held, or the next preceding year. If more than one-half of the farmers voting in the referendum oppose the quota, such quota shall become ineffective upon proclamation of the results of the referendum. The Secretary shall proclaim the results of any referendum held hereunder within fifteen days after the date of such referendum.

(4) In the case of agricultural commodities, a significant proportion of the production of which are expected in the year to which the marketing quota pertains to be exported from the territorial limits of the United States, the Secręary and the Board shall proclaim a domestic marketing quota and an export