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Additional data submitted to the subcommittee by-
Clyde, Don:

List of sheep producer organizations authorizing Don Clyde to

represent them...

Department of Agriculture:

Number of stock sheep in the United States; domestic production,

imports and consumption of wool; wool prices and payments

under the National Wool Act of 1954 and 70 percent of duties

collected on wool and wool manufactures..

Report on H. R. 9539 by True D. Morse, Acting Secretary, of

January 16, 1958.

Fisher, Hon. O. Clark:

Proposed committee amendment to the bill for Wool Act renewal.

McLain, Hon. Marvin L.:

Exhibit A-Stock sheep and lambs on farms January 1..

Exhibit B—United States duty-paid imports of wool by specific

countries of origin ..

Exhibit C-Foreign value of wool imported into the United States

and import duties.-

Exhibit D-Prices paid by farmers--

Exhibit E-Pasture-feed conditions, October 1, 1956...

Exhibit F-Prices for wool at Boston and Sydney, Australia --

Exhibit G-CCC holdings of wool accumulated from 1952 to

1954, price-support loan program.

Exhibit H-Average price received in the open market by

growers and incentive payments for shorn wool.

Exhibit I--Number of stock sheep in the United States; domestic

production, imports and consumption of wool; wool prices and

payments under the National Wool Act of 1954; and 70 percent

of duties collected on wool and wool manufactures (table) -

Exhibit J—Number of goats clipped; production and consump-

tion of mohair, and farm price of mohair in the United States

(table)

Exhibit 'K-Number of farms and ranches reporting sheep and

shearing sheep in 1949 and 1954 (table) -

Exhibit L-Production of shorn wool, by States (table)--

Exhibit M-Estimated mill consumption of wool, cotton, rayon,

acetate, other man-made fibers and silk, United States, 1938

to date (table) -

Exhibit N-Price per pound of wool and other textile fibers, 1938

to date (table) -

Exhibit 0-Duties collected on wool and wool manufactures

imported into the United States (table)--

Exhibit P-Projections of payments under wool payment program

and duty collections avaiable for payments through the 1958

marketing year with incentive price at 62 cents for the 1958

marketing year (table) --

Exhibit Q-Wool payments through October 31, 1957, for the

1955 marketing year (table)--

Exhibit R-Wool payments through November 30, 1957, for the

1956 marketing year (table)--

Exhibit S-How wool payments are figured (table) -

Poage, Hon. W. R.:

Campbell, Phil, Atlanta, Ga., telegram of February 3, 1958-.

Smylie, Gov. Robert E., telegram to Hon. Hamer Budge..-

123

122

EXTEND NATIONAL WOOL AOT OF 1954

TUESDAY, FEBRUARY 11, 1958

HOUSE OF REPRESENTATIVES,
SUBCOMMITTEE ON LIVESTOCK AND FEED GRAINS
OF THE COMMITTEE ON AGRICULTURE,

Washington, D. C. The subcommittee met, pursuant to notice, at 10 a. m., in room 1310, New House Office Building, Hon. D. R. Matthews presiding.

Present: Representatives Matthews (presiding), Hill, Johnson. Also present: Representatives Cooley and McIntire; John Heimburger, counsel; Mabel C. Downey, clerk.

Mr. MATTHEWS (presiding). Ladies and gentlemen, I think we will get started on our hearings this morning.

We have before us several bills which will be made a part of the record at this point:

(The bills referred to and Department report are as follows:)

(H. R. 9518, 85th Cong., 1st sess.)

A BILL To extend the National Wool Act of 1954 Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 703 of the National Wool Act of 1954 is amended by striking out "March 31, 1959” and inserting in lieu thereof “March 31, 1963.”

(H. R. 9519, 85th Cong., 1st sess.)

A BILL To extend the National Wool Act of 1954 Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 703 of the National Wool Act of 1954 (68 Stat. 910) is amended by striking out "March 31, 1959” and inserting in lieu thereof “March 31, 1963".

[H. R. 9532, 85th Cong., 1st sess.)

A BILL To extend the National Wool Act of 1954 (68 Stat. 910) Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 703 of the National Wool Act of 1954 (68 Stat. 910) is amended by striking out “March 31, 1959” and inserting in lieu thereof “March 31, 1963."

(H. R. 9535, 85th Cong., 1st sess.]

A BILL To extend the National Wool Act of 1954 (68 Stat. 910) Be it enacted by the Senate and House of Representatives of the United States of

ca in Congress assembled, That section 703 of the National Wool Act of 1954 (68 Stat. 910) is amended by striking out "March 31, 1959" and inserting in lieu thereof "March 31, 1963."

(H. R. 9539, 85th Cong., 1st sess.] A BILL To extend the National Wool Act of 1954 (68 Stat. 910) Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That section 703 of the National Wool Act of 1954 (68 Stat. 910) is amended by striking out "March 31, 1959” and inserting in lieu thereof “March 31, 1963."

1

DEPARTMENT OF AGRICULTURE,

Washington, D. C., January 16, 1958. Hon. HAROLD D. COOLEY, Chairman, Committee on Agriculture,

House of Representatives. DEAR CONGRESSMAN COOLEY: This is in reply to your letter of August 30, requesting a report on H. R. 9539, a bill to extend the National Wool Act of 1954 (68 Stat. 910) for an additional 4-year period. This report also applies to H. R. 9995.

The Department recommends the extension of the National Wool Act of 1954.

The act provides for an incentive price for shorn wool to be established at such level as the Secretary of Agriculture, after consultation with producer representatives and after taking into consideration prices paid and other cost conditions affecting sheep production, determines to be necessary to encourage an annual production of 300 million pounds of shorn wool. Growers sell their wool in normal marketing channels. After the end of the marketing year and the average price received for shorn wool during the marketing year by all producers is known, payments are made to bring the national average return per pound up to the incentive level. The act also provides for the support of pulled wool and mohair. Under the existing legislation, such support is limited to wool and mohair marketed during the period beginning April 1, 1955, and ending March 31, 1959. In addition to supporting prices for wool and mohair, the act authorizes the Secretary to enter into agreements with marketing cooperatives, trade associations, and others for the purpose of developing advertising and sales promotion programs, such programs to be financed by deductions from payments.

Wool is one principal agricultural commodity in which our country is deficient in production. The act was developed to handle the special problem of price assistance for domestic woolgrowers without (a) adversely affecting foreign trade, (b) adversely affecting the competitive position of wool with imported wool and other fibers, and (c) having the Government in the wool-merchandising business. The payment program under the act is an alternative to supporting wool prices by loans or purchases or by raising the tariff to protect domestic growers' prices against the lower prices of imported wools. Support by loans and purchases resulted in domestic wools accumulating in the hands of the Government while mills looked to imported wools for an increasing share of their requirements. Raising the tariff to obtain higher prices in the domestic market would adversely affect foreign trade and also the competitive position of wool with other fibers.

The incentive price for shorn wool was established at 62 cents for the first marketing year of the payment program and has been continued at that level for each year since. The payments the first 2 years were greater than anticipated when the 62-cent incentive level was first established because of the greater than expected decline in the prices received for shorn wool in the free market. The national average received by producers for the 1955 marketing year was 42.8 cents per pound and for the 1956 marketing year, 44.3 cents. Part of the decline in prices may have been the cost of getting back to a free market after several years of support at fixed prices. Also the CCC stocks accumulated from the previous price support loan programs were a depressing influence on market prices at the outset. The monthly average prices received by growers for shorn wool declined from early 1955 to a low of about 38 cents in January 1956 but in early 1957 were at their levels of 1952, 1953, and 1954. Consequently, the amounts of payments henceforth are expected to be less than the first and second years. Each 1 cent the national average price received by growers in the free market approaches the incentive price means around $3 million less required in payments.

Under the act the total payments are limited to 70 percent of the specific duties collected on wool and wool manufactures since January 1, 1953. These an unts have ranged from 25 to 35 million dollars a year-$28 million last year. Through March 27, which includes the years 1953 and 1954 plus the first 2 years of the new program, the total was $128 million. Payments totaled approximately $58 million the first year and around $53 million the second. Deducting these $111 million in payments from the amounts available for payments, leaves a $17 million balance for the current and later years to cover payments in excess of duty collections.

With regard to the progress being made toward increased production of wool in accord with the intent of the act, sheep numbers and wool production continue at low levels. Shorn-wool production in 1957 is estimated at 226 million pounds compared with the 300-million pound goal under the act. The net decline in

wool production the last few years has been primarily due to reductions in sheep numbers in Texas and several of the Western States where severe drought conditions prevailed. Due to the nature of the enterprise, year-to-year increases in wool production can be expected to be only gradual even under most favorable conditions.

Attached is a table showing the number of stock sheep in the United States: domestic production, imports, and consumption of wool; prices received by producers for shorn wool; payments made under the National Wool Act of 1954; and duty collections on imports of wool and wool manufactures by years.

Enactment of this proposed legislation would continue the existing program and would result in no increase in employment or in administrative costs.

The Bureau of the Budget advises that there is no objection to the submission of this report. Sincerely yours,

TRUE D. MORSE, Acting Secretary.

Number of stock sheep in the United States; domestic production, imports and consumption of wool; wool prices and payments under the National

Wool Act of 1954 and 70 percent of duties collected on wool and wool manufactures

Wool payments :

70 percent
of specific

duties

Unshorn

lambs
(cents)

Total
amount
(million
dollars)

46.9 32.0 51.6 53.9 52.4 35. 5 25.4 331.5 28.2

58

77 71

4 53

Wool production (million pounds) 1

Wool price (cents per pound)

Year

Stock

sheep
on farms
Jan. 1
(1,000
head)

Wool
imports

for
consump-

Mill
consump-

tion 2

Received

Shorn

Pulled

Total

tion 2

by pro

Support

level

Shorn

wool
(percent)

ducers

18.0
18.0

1938
1939
1940.
1941.
1942.
1943.
1944.
1945.
1946.
1947.
1948
1949.
1950.
1951.
1952
1953
1954.
1955
1956..
1957

44, 972
45, 463
46, 266
47, 441
49, 346
48, 196
44, 270
39, 609
35, 525
31, 805
29, 486
26, 940
26, 182
27, 251
27, 944
27, 593
27, 079
27, 137

27, 012
6 26, 370

360
362
372
388
388
379
388
308
281
251
232
213
217
228
233
332
236
234
232

103
103

99
105
107
104
118
113
98
91
75
57
52
41
54
68
70
67
64

463
465
471
493
495
483
456
421
379
342
307
270
269
269
287
300
306
301
296

45
133
269

761
1,039

903
784

950
1, 075

589
560
352
568
618
565
377
236
256
236

499
666

705
1, 169
1, 274
1, 371
1, 311
1, 339
1, 385
1, 195
1, 103

770
993
869
788
814
613
639
674

19.1
22.3
28.4
35. 5
40.1
41.6
42.3
41.9
42. 3
42.0
49.2
49. 4
62. 1
97.1
54. 1
54.9
53. 2
42.8
44. 3

41.7
42. 4
41.9
42.3
42.3
42. 3
42. 3
45. 2
50. 7
54. 2
53. 1
53. 2
62.0
62.0

44.9
40.0

6 226

1 Converted to domestic greasy shorn equivalent on basis of 1 pound pulled wool equal to 1.6 pounds greasy shorn wool.

? Apparel wool converted to domestic greasy shorn equivalent on basis scoured yield equal to 44 percent of greasy shorn wool.

3 Shorn wool, percent of net proceeds received by each producer, unshorn lambs, cents
per hundred pounds liveweight.

4 Estimated.
6 Marketing year beginning Apr. 1, 1955; calendar year prior to 1955. For January-
March 1955 period 70 percent of specific duty collections totaled $8,000,000.
0 Preliminary.
Prepared by Livestock and Dairy Division, CSS, Jan. 16, 1958.

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