Mr. BAINE. Yes. There is such a thing recently put on the market as a peanut meal for human food. It is very, very nutritious and very valuable. It is also very fine for cattle feed and hog feed as well as for fertilizer.

Senator MCLEAN. What can you get for that?

Mr. BAINE. That peanut meal varies very much. Just at present it is very low. I imagine peanut meal to-day is worth about $35 a ton from the oil mills.

Senator MCLEAN. It is good for fertilizer?

Mr. BAINE. Yes, sir; it is very good for fertilizer.
Senator MCLEAN. Do you use it for tobacco?

Mr. BAINE. It is not quite high enough grade for tobacco, but it is used for it and can be used for it, though tobacco requires a very high ammoniate fertilizer generally.

Senator MCLEAN. It is not as good as cotton seed?

Mr. BAINE. I do not think so. I do not think it contains as much ammonia as cottonseed oil does.

The CHAIRMAN, Are there any other suggestions which you wish to make?

Mr. BAINE. I do not know of any, unless you have some other questions.

The CHAIRMAN. We are much obliged to you, Mr. Baine.

Senator SIMMONS. Can you give us the value of the invested capital in peanuts?

Mr. GRONER. The total amounts to about 35,000,000 bushels, and there are 25 pounds to a bushel, and on the basis of about 4 cents a ton-I can figure it out for you in a moment, Senator.

Mr. BAINE. About $35,000,000.

Senator SIMMONS. That is the part raised for market?

Mr. BAINE. Yes, sir.

Senator SIMMONS. Is there any part of it that is devoted to fattening hogs?

Mr. GRONER. Yes, sir; the hogs are turned loose in the fields to grub up what is left, and they produce that very fine article known as Smithfield ham.

Senator SIMMONS. But in addition to the peanuts that you place on the market there are some that you keep in the ground and that makes a very valuable food product?

Mr. GRONER. Yes, sir.

Senator LA FOLLETTE. The total farm value of the 1919 crop was $79,000,000, as given by the Agricultural Yearbook. There were 33,000,000 bushels produced in this country.

Mr. GRONER. That was on the basis of 12 cents a pound-9 to 12 cents a pound. On the present basis it is just about half of that." The CHAIRMAN. Did I understand you, Mr. Groner, to say that the nuts that were left in the ground are consumed by the hogs and they produce this "Beechnut " ham?

Mr. GRONER. The Smithfied ham. ]Laughter.[

Senator SIMMONS. That is not quite a laughing matter. There are large sections of the country that grow peanuts for no other purpose except as a hog food. That is true of the section of North Carolina in which I live. In the northeast counties they raise them for market, and in the section in which I live we raise them for feed for hogs and for the improvement to the land.

Mr. GRONER. A fertilizer.

Senator SIMMONS. It is a nitrogen-gathering plant and it is of great benefit to the land if it is left in the soil.

STATEMENT OF MR. FRANCIS M. TURNER, CHEMICAL ENGINEER, AMERICAN NUT AND SEED OIL CORPORATION, NEW YORK, N. Y.

The CHAIRMAN. Will you state your occupation and what you represent?

Mr. TURNER. I am a chemical engineer of the American Nut and Seed Oil Corporation, New York City. The American Nut and Seed Oil Corporation is a manufacturer of coconut meal. They are also equipped to press other seed oils, but their attention is directed toward the manufacture of coconut oil. The coconut-oil industry in the United States is almost directly caused by the shortage of fats during the war. In Europe coconut pressing has been done for the last two centuries, but in the United States, with the exception of a small quantity, which was pressed for soap making previous to the war, there was none made. While there was no coconut butter or margarine eaten in 1914, last year there were 219,000,000 pounds of it consumed in the United States. In Europe I had an opportunity this year of studying the oil conditions abroad-in Scandinavia, Germany, France, Belgium, and Great Britain. There the use of coconut oil for food obtains very greatly. Thirty-three pounds per capita were used in Scandinavia notwithstanding the fact that they are a butter-producing country. In this country last year we used rather less than 2 pounds, but the industry, as I stated, is growing enormously.

The CHAIRMAN. They use it in making butterine?

Mr. TURNER. Coconut butter. sir. Coconut butter is a mixture of refined coconut oil and cream which has been cultured.

This industry has been developing. A great deal of capital has been invested, and to-day we stand in the position of being absolutely unable to operate. Every ton of copra or dried coconut meat we press here we stand to lose $30 a ton, and if we continue to do it it is going to put us out of business.

I will tell you the reasons for that condition.

As I stated, here is one of the plants of the American Cottonseed Oil Corporation which has just been built. [Exhibiting a photograph to the committee.] It is as fine a mill as there is in the world to-day, much finer than anything in Europe, although not quite as large as some of the European mills. During the war there was a shortage of fats-

Senator CALDER. When was that factory built?

Mr. TURNER. That factory is just completed, sir. It was started, and we had many troubles in building it during the war because of lack of material, strikes, labor troubles, etc. It should have been completed two years ago.

Senator THOMAS. When was your company organized?

Mr. TURNER. Our company was organized three years ago.
Senator THOMAS. What is its capitalization?

Mr. TURNER. It is a close corporation. It is owned by the Farmers' Feed Co. of New York, who were practically legislated out of busi

ness. They were producers of brewers' grain and other feeds for cattle, and we have had to direct our energies into other lines, and we built that plant at Newark and this plant [indicating] at Buffalo, which represent an outlay of considerably over one and a half millions.

Senator THOMAS. Did I understand you to say it was a constituent of some other corporation?

Mr. TURNER. The Farmers' Feed Co. own the American Nut & Seed Oil Corporation. They own also the Maritime Milling Corporation, of Buffalo, which is a manufacturer of mixed feeds for cattle. They take the by-product from this mill.

Senator THOMAS. When was the Farmers' Corporation organized? Mr. TURNER. About 50 or 60 years ago. It is a very well-known concern in its line.

During the war, of course, the price of coconut oil was high here. The differential between copra, which is the dried coconut meat produced in the South Sea Islands and in Manila, and the oil was about 50-50. A large oil crusher says that as a fair differential if copra cost 6 cents oil should cost 12. They should be able to get 12 cents a pound. for it. If copra costs 7 cents, they should get 14. To-day the cheapest that copra can be bought is 7 cents. There is 60 to 65 per cent of oil in the copra, and if I dry a ton of copra at 7 cents it costs $140. I press the oil out of it and get 60 per cent of oil, which is just as much as can be pressed out of it. That would only give me 1,200 pounds of oil, and the cost of pressing is, say, $20 a ton or 1 cent a pound, and my ton of copra has cost me

Senator THOMAS. Is the copra, after the oil is pressed from it, of any commercial use?

Mr. TURNER. It is a very valuable cattle food. It is rich in protein and rich in fats. It is a very valuable cattle food indeed, but unfortunately it is selling at a very, very low price to-day.

Senator MCLEAN. What price is it selling for, and why should it be selling at a very low price when other cattle feeds have been very high?

Mr. TURNER. Cattle feeds are very low, sir, at the present time. Senator MCLEAN. Just now; yes.

Mr. TURNER. They have come down. Cattle feeds are very low, and they are very low in spite of the fact that their source is very much diminished. There is not as much brewing done in these days as was done a short time ago. Consequently the source of brewer's grain is very much less.

Senator MCLEAN. Do you get all your raw material from abroad? Mr. TURNER. Yes, sir. The coconut is produced in latitude 20 north and south of the Equator.

I would be very glad to answer any questions regarding the cost of

copra.

It costs to produce it in the South Sea Islands about 44 cents, and the freight to bring it to San Francisco makes it about 5 cents, and that is the bottom price of copra to-day on the coast. The freight on copra from the coast here is $1.13 a hundred, so that copra to-day ranges from 63 to 73 cents from China to New York. So I put it at 7 cents so as to be perfectly fair.

As I said, a ton of copra costing $140 and $20 to crush it really costs $160. It costs $160 to produce 1,200 pounds of oil, for which the best price to-day is 10 cents. There is a loss to-day of $30 on every ton.

If this duty were put on it would cost approximately 2 cents a pound, and that would enable us to come out about even and preserve the industry. There is no doubt in my mind but what the price of oil will be somewhat higher as the stocks become exhausted. There is no pressing being done at the present time. No presser can afford to do it.

It is an industry that affects your State, too, sir [addressing Senator La Follette].

Senator SIMMONS. You mean that you want a duty put on the finished product? You do not want a duty put on your raw material that you get abroad?

Mr. TURNER. No; we do not. That is one of the things that we do not grow in the United States.

Senator MCLEAN. They grow coconuts in Florida, do they not? Mr. TURNER. We use a million and a half coconuts a day. That is more coconuts than there are grown in Florida in a year.

Senator MCLEAN. You could grow more in Florida, I suppose? Mr. TURNER. I do not think so. Seriously, the coconut does not obtain 20° north of the Equator. You might think that the West Indies would afford a very good source of supply of copra and coconuts, but they do not. There is not enough grown now in all the West Indies to keep us in operation three months.

Senator SIMMONS. But suppose these Florida people would come here and say, "It would help us if you would put a duty on this product. It is being brought here and used in competition with ours." Would you object to that?

Mr. TURNER. I happen to be a Floridian myself. I have a farm down there of 10 acres.

Senator SIMMONS. You would prefer them, would you?

Mr. TURNER. I say I own a farm of 10 acres in Florida, so I can speak as a Floridian and answer your question.

Senator SIMMONS. I would like to hear you.

Mr. TURNER. It would be rather difficult to grow copra there. We are in competition with Great Britain and with the oriental oil pressers, and to-day, with the differential of exchange, it is the practice of the Japanese presser and the Chinese presser and others to dump their oil into the United States. They have dumped it in so successfully that they have depressed the price of crude coconut oil.

There is a differential between coconut oil and refined coconut oil for edible purposes. They are dumping crude coconut oil in here, and it has been offered at 81, 84, and 9 cents a pound, just about the price of the copra. We can not compete with Japanese labor and with oriental labor in pressing oil. If we are not given some protection the millions of dollars that have been invested in apparatus for pressing coconut oil in this country to meet the demand for coconut butter will be lost and gone. It is a very serious matter, very serious, indeed.

After coconut oil is pressed out it must be treated so as to render it edible. It contains a large quantity of fatty acids, and they must

be removed. The oil is treated. It is neutralized and decolorized and it is finally deodorized, and it is then fit to be used in baking and in lard compound and in the making of margarine butter.

Senator THOMAS. I should think it would come into competition with American lard.

Mr. TURNER. It enables us to ship a great deal of compound lard abroad every year. We take very little iard and a large amount of coconut butter, and they are churned together and sold as compound lard.

Senator SIMMONS. Where does that go?

Mr. TURNER. It is shipped abroad when they can pay for it. Senator SIMMONS. Where abroad? Where is your chief market? Mr. TURNER. Great Britain takes a large quantity of fats

Senator SIMMONS. Do you not have to sell it in competition with this Chinese and Japanese material that you have spoken about?

Mr. TURNER. No, sir; because the differential in exchange to-day does not allow the British manufacturer to suffer very materially from having Japanese oil dumped in on him.

Senator SIMMONS. What do you get for it in Great Britain?

Mr. TURNER. We do not manufacture compound lard ourselves. Senator SIMMONS. You said you sold some of this other material in Great Britain that you say you produce.

Mr. TURNER. Yes.

Senator SIMMONS. I assume you do not sell it over there unless you can make some profit on it. What do you get for it?

Mr. TURNER. I can tell you what the price of coconut margarine is to-day in contradistinction to the price of butter. The price of margarine retailing to-day--and it is very palatable, and if it were on the table here and you ate it you would say it was equal to the highest grade of creamery butter. It is being used in Denmark, although that is a butter-producing country, and the Danes are dumping their butter into the United States and it is being sold in New York at 30 cents a pound, and it will readily displace our butter. Senator SIMMONS. What do you say you are selling your butter for in this country now?

Mr. TURNER. At the present time we have met the competitionSenator SIMMONS. I am not talking about competition, but the price that you are selling it for now.

Mr. TURNER. The price of what, sir?

Senator SIMMONS. Your product, whatever it is.

Mr. TURNER. The price of crude coconut oil to-day is 10 cents. Senator SIMMONS. In this country?

Mr. TURNER. Yes, sir.

Senator SIMMONS. You say you are exporting some?

Mr. TURNER. No, sir; I did not say we were exporting some.
Senator SIMMONS. I understood you to say so.

Mr. TURNER. Under normal conditions we can, but we are not at present.

Senator SIMMONS. When did you make your last exportation? Mr. TURNER. We have not been in operation to any extent yet. This is a new concern. We stopped a year ago when the price of our oil was so depressed that we could not manufacture it any further.