Mr. Randolph voiced opposition to the promotional aspects of title V. He felt that the present Alabama State promotional program, under auspices of growers rather than the Federal Government, would conflict with the proposed promotional section of title V. Mr. R. Wilson pointed out that the southwest area is opposed to that section of title V setting forth deductions for promotion at 14 percent. He wanted it made clear that the Southwest is in favor of such a promotional program at lower percentage deductions, possibly not to exceed 1 percent. After discussion, Alabama and Georgia wished to be recorded as opposed to the promotional aspects of title V as presented. Florida voted neutral on the matter. North Carolina and Virginia representatives were in favor of the provision as set forth.

Mr. R. Wilson stated that the Southwest desired that all remaining deductions provided for in title V, except promotion, be made strictly on an area basis. Mr. Duncan disagreed with this theory saying that he felt that all areas should assist each other in paying the costs of price support program on peanuts. Mr. Thigpen agreed with Mr. Wilson's suggestions in part but suggested that possibly it might be better to base deductions not only on areas but by types. He stated that past history has shown a tendency for Runner peanuts to produce over and above demand while Spanish has failed to produce sufficient quantity to meet demands. Mr. Randolph stated that Alabama is opposed to deductions by areas for two reasons: (1) Such a program could not be sold to the growers. (2) Although some economic justice is presented in the plan, in Mr. Randolph's opinion the fact that many Runner peanuts are crushed is a main factor in preventing the necessity of crushing other types. Mr. Thigpen presented for discussion his tentative thinking on a two-price system on peanuts, differing somewhat from a similar plan used several years ago. Such a plan might possibly provide for a farmer to grow a certain number of quota acres peanuts, plus a certain number of additional acres to be sold at an oil stock price. Since this plan would increase the possible surplus tonnage in any given year, some additional deduction would of necessity be taken from the amount the farmers received to finance the cost of such diversion.

Mr. Rawlings pointed out that if the national acreage allotment should remain at 1,610,000 acres the proposed 5 percent deduction would not be sufficient to finance the program. He added that additional arithmetic computations would be necessary to determine the percentage of increase necessary but that he estimated it would likely be in the vicinity of 10 percent.

Mr. Braswell stated that it is necessary to have legislative authority for the reductions of acres in order that supply may be brought in line with demand. If this is not done, the farmer will, of necessity, suffer in the long run. It is for this reason that he has advocated and still advocates a reduction in acres as proposed in section 2 of the bill under discussion.

A general discussion was held concerning the slight increase in producer advance value per ton of peanuts at set forth in the bill. Mr. Randolph's opinion was that any substantial increase in prices will affect adversely the consumption of peanuts at the commercial level. Mr. Braswell pointed out that history has proven that although price supports were lowered on wheat, the cost to the consumer has continued to rise.

Mr. Thigpen commended the group on the discussions for the day and opinioned that the group had reached a greater degree of agreement than possibly realized. He said that he felt the group agreed that eventually some sort of self-financing plan would be essential to the peanut industry and that such a plan might necessitate higher dollar value deductions or fewer acres allotted. He said that he felt that consensus of opinion of the group was that promotion is important although perhaps to a lesser degree than presently proposed percentagewise. He thought that further study might be given to the deduction by areas and/or type plan as he felt a plan of this sort had considerable merit.

Mr. Randolph stated that in his opinion the people of Alabama are not presently ready to accept a self-financing plan. Mr. Wilson, of Georgia, stated that he was in agreement with Mr. Wingate's earlier statements to the effect that any acreage or type increase should be made across the board for all areas.

(e) Section 6 of the proposed bill was briefly discussed. It had earlier been tentatively decided that the proposed bill would be based on scale 108 and, in line with that thinking, sections 6 and 7 of the proposed bill would be eliminated. (f) Section 8 of the proposed bill was reviewed briefly. Mr. R. Wilson posed the following question concerning section 8: "What is the opinion of the group as to the effect the ad-on provision will have on the chances of the proposed bill

to pass Congress?" Mr. Rawlings replied that the add-on provision can be solidly defended since the resulting total would only be up to a maximum of 90 percent of parity, as compared to up to a maximum of 100 percent of parity in the case of certain other commodities. Mr. Rawlings and Mr. Griffin both stated that they felt this type provision is essential to secure grower votes for the bill. Discussion brought out that in the final analysis the cost of this proposed program is shifted from the Federal Government to the ultimate consumer.

Mr. Boyd suggested that each delegation go back home and sell the entire program as it presently stands in total. Mr. Braswell suggested that more work should be done by the group individually and possibly at a later meeting toward compromising points of disagreement.

Mr. Rawlings suggested that each area solidify a proposed bill encompassing the aspects desired; then present such a plan to the appropriate Congressmen for their study but not to be presented for a public hearing before a subcommittee. Mr. R. Wilson voiced agreement with Mr. Rawlings' suggested plan. Mr. Braswell stated that he again felt that any peanut bill must be a part of an overall farm plan. He is opposed, however, to agreeing that the bill not be introduced this season. He suggests, alternately, that the bill which each area comes up with, or an overall compromise for all areas, be put before an Agricultural Subcommittee with the definite understanding that it is not to be pushed out alone but is only to be a part of an overall farm bill.

Mr. Griffin again stated that he is definitely opposed to introducing any peanut bill this season for any public hearing.

It was agreed that representatives from each area would continue to work toward a desired proposed bill. If a meeting with the other two areas is desired in order to facilitate compromises, Mr. Rawlings is to be contacted relative to setting up a meeting. It was further suggested that insofar as possible the same personnel should attend each meeting so that all will be familiar with background discussions and provisions. It was lastly agreed that Mr. Rawlings, if and when a later meeting of all three areas is desired, will contact one person in each area relative to the meeting.

ROSS WILSON, Acting Secretary.

1958 Letter No. 33

GEORGIA FARM BUREAU FEDERATION,

Macon, Ga., March 13, 1958.

To: County officers in peanut producing counties and GFBF commodity committee.

From: Troy Barton, legislative director.

Subject: Results of Peanut Meeting, Monday, March 10.

Upon call of the Georgia Farm Bureau, peanut producers from all over Georgia, with producer representatives from Florida and Alabama, met at Radium Springs to decide and chart a course of action on peanut legislation that may be introduced in this session of the Congress.

The GFBF has not proposed any legislation for this session but has had to give considerable thought and time to a proposed bill by the peanut and hog associations of Virginia and North Carolina. These two organizations have worked on a bill for the past 3 or 4 years which, from all study, seems to benefit their States more than other areas.

President Duncan presided at this meeting and opened by giving a brief report on meetings held recently and especially a meeting held in Washington relating to peanut legislation. He stated that everyone in attendance at the Washington meeting intimated that they could not go along with the Virginia and North Carolina proposal and everyone agreed it would be wise to call meetings by States of producers to make final decision.

Mr. Duncan asked Steve Pace; Walter Randolph, president, Alabama Farm Bureau; Cyril Boyd, representing Florida Farm Bureau; H. B. Wilson, chairman, GFBF peanut commodity committee; J. H. Wyatt, secretary, GFBF peanut commodity committee; and D. W. Brooks, general manager, CPA, to discuss their opinions of any legislation or the proposed bill subject to be introduced anytime.

Mr. POAGE. I agree. But they are holding to this rule in opposition to 2 of the 3 areas, at least, because obviously the Virginia-Carolina people and the southwestern people would like to see the rule changed, wouldn't they?

Mr. THIGPEN. On the particular point, I don't believe-you could ask the Virginia-Carolina people-I don't believe it makes very much difference to them one way or the other. I think if the rule is changed, with saying that the damage tolerance in all of these types on No. 1 peanuts be 1.5 or 2 percent, that it is a sort of a useless move. And I would say to you personally, I wouldn't object to that because I don't care to see the squabbling go on. I think they are going to put the peanuts up and sell them for what they are regardless of the Government grades as they stand, and as badly as I think we need serviceable Government grades for merchandising peanuts.

Mr. MILLER. Mr. Poage, we would like to work out our difficulties as well as we could with the producer organizations with the least amount of disturbance and discord we could have. I think the Department actually appraises every move that it might make, and more or less fathoms grower reaction to see what the end result will be.

Frankly, maybe we would have moved more aggressively in some areas than we have, had it not been for the differing views we have seen evidenced among the peanut growers. We certainly have no intent of maintaining a sore spot, so to speak, to the detriment of the program. We would like to remove it if we see it is possible and prac tical to do so, for the improvement of the program itself.

Mr. MCMILLAN. Should the growers in the Southwest and Southeast get together on that one point, would the Department correct it? Mr. MILLER. I don't want to answer for the Agricultural Marketing Service, but I would say certainly if it is for the improvement of peanut program and the peanut growers, I see no reason why the Department of Agriculture would not go in that direction.

Mr. POAGE. Well, as one little irritant, may I ask you about thisthat is a small irritant. The Burleson bill would correct that. As far as I know nobody in the Southeast, nobody anywhere else, has objected to it except you, the Department.

Now Mr. Brooks is a good friend of mine. I admire him as an individual and his organization. But you have planted him over in our midst, and have let him take money from the cotton cooperative members and go into the peanut business with it. We want to know why the Department is so determined that we shall have to have Mr. Brooks' organization operating in the Southwest. Now, I don't think in the Southeast that has any insistence on that. There is nobody among the growers that are demanding that you put Mr. Brooks in the Southwest, is there?

Mr. MILLER. I know of no growers in the Southwest that are demanding it. I think that the Department has seen fit to recognize the cooperative movement for a great number of years.

Mr. POAGE. We haven't a bit of objection to your recognizing the cooperative movement. In fact, we want you to recognize it. But we would like you to recognize our own cooperatives, instead of moving somebody from Atlanta, Ga., into Texas and Oklahoma.

Mr. MILLER. We are rather hard put, Mr. Poage, to justify limiting the fields of operation of any cooperative association in the United States.

Mr. POAGE. You immediately recognize and allow them to proceed to do things that you don't allow anybody else to do in that area. If you treated them just the same as you treated everybody else, we could not object. But you give him all the privileges he enjoys because of his well-established cooperative offer in the Southeast, and he actually represents peanut growers over there, and I am sure renders some real service. I know he has rendered a service in the cotton industry. I have no criticism of their organization. All I am saying is, Why do you inflict it on us?

Mr. MILLER. Well, I think if any similar coperative associationand I am not speaking in favor of Mr. Brooks personally today, endorsing either cotton or other coperatives, but endorsing the cooperative movement as a whole-if any cooperative association should care to expand, I think the Department of Agriculture would recognize their right to do so.

Mr. POAGE. You let him move over there without one single peanut cooperative member, and called his association a cooperative although it did not have one single peanut grower as a member. Now, they had some cottongrowers, all right. They have cottongrower members. But why should a cotton cooperative, an association made up of people who are growing cotton-why should they receive the advantages that are accorded to a peanut cooperative?

Mr. MILLER. Mr. Poage, I don't know that you would want to limit the operations of a cooperative association and prevent its expansion merely because it does not have members at the time it intends to expand facilities into another area.

Why should you limit them or exclude them or preclude them from moving into that area because they do not have any members as of that time

Mr. POAGE. You wouldn't let the cooperative pickle growers of New York come down there and be recognized as a marketing agent for peanuts, would you?

Mr. MILLER. I would think so, yes, sir, if they had peanut facilities, and people who would like to join a cooperative association. I don't think the Department of Agriculture or any other organization would want to attempt to preclude them from coming into an area.

Mr. POAGE. I don't know how far you will go. You have many kinds of cooperatives.

Mr. MILLER. We have attempted, and I think have succeeded, in not giving any greater benefits to this cooperative association than has been given to other cooperative associations or private industry engaged in the shelling operations.

Mr. POAGE. Mr. Wilson's cooperative-you make them take all peanuts, don't you? They have to take them. And they have to care for them. Mr. Brooks just takes what he pleases. It is sort of like this railroad fight. The railroads say that the trucks haul what they please, and we force the railroads to haul anything which is offered. You force some of these people to do the whole job, and you let others do that part of the job they want to.

Mr. MILLER. We have recognized the desirability of extending the prime contract price for support through one stabilization cooperative association. This is a different operation from an individual producer or association of producers known as a cooperative. We

placed Mr. Brooks and his organization in the latter category. He stands in the place of his members individually and separately. And as such, we think, is entitled to price support in the same manner as extended to any individual. That is the way we generally extend price supports.

Mr. POAGE. Mr. Miller, all I want to say is there are a lot of little irritants building up. And as far as I am concerned in the last 10 years the Department has not removed one of them. Obviously it is going to break the whole program down if it goes on as it is.

Mr. MCMILLAN. To sum up this hearing, we would like to ask you, if possible, to see if you can give these people some assistance, and get together on this item where there is some controversy, getting the Southeast and Southwest on the same basis.

Any further questions?

Mr. ABBITT. Yes; I would like to ask him something now. In addition to the grades, I don't believe Congressman Poage went into the question about differential in price. I am vitally interested in that. And I am wondering if any real headway is being made in eliminating the differential in price between the various types of peanuts. I think that is just vital to our industry if we are going to survive. And I don't see how our people can survive if the Department is going to maintain the position for this year that it has in the past. I am just wondering if any related way has been made in eliminating the discrimination in the differential?

Mr. MILLER. Mr. Abbitt, Mr. Thigpen has been conferring with the growers and associations of growers since we had a meeting with Mr. McLain and several members of the congressional committee some 6 or 8 weeks ago. Mr. McLain has been vitally interested in this subject. Mr. Thigpen can explain to what extent he has made progress, and as to how soon he thinks he might be able to come up with some recommendations. I won't ask him to divulge what they are at the present time because they are still subject to revision. But if he can give you a report as to what progress he has made, I think it would be good at this time.

Mr. ABBITT. It certainly would be helpful. I don't want him to disclose anything.

Mr. THIGPEN. Could I comment off the record?

(Discussion off the record.)

Mr. THIGPEN. Howard Akers, who worked for a long number of years on price supports on peanuts, stated occasionally that many people held the view, and he tended to share it, that a pound of sound mature kernels was worth the same thing regardless of type. Now, that is a rather plausible kind of theory, and a way to look at the question. And I, myself, tended to feel that there was considerable merit to that point.

So when this suggestion was made at the discussion some weeks back by the people representing the Virginia-Carolina area, and in turn by the people representing the southwest area, that the matter be approached on that basis, we began digging into it as thoroughly as we could.

Our job on differentials actually would be easier if we could defend that position, specifically.

We have obtained some information in the past several weeks which we have not had heretofore, bearing on the question. Here