In view of the fact that U.S. acid-grade capacity was cited by the American producers at 264,000 tons in the original petition of 1955, while production increased only from 157,000 tons in 1955 to 187,000 tons in 1957, it is obvious that a somewhat lower figure might be more accurate.

(3) "Existing and anticipated availabilities of the human resources, products, raw materials, and other supplies and services essential to the national defense ***” One of the questions as to which considerable controversy exists is the amount of actual reserves and the possible rate of depletion. The application speaks of additional discoveries which would increase the proven tonnages over those estimated by the Department of Interior in 1957. However, since no quantitative figures are given for these additional discoveries, for the purposes of analysis we must use the 1957 figures of the Department of Interior. These are that U.S. reserves total about 221⁄2 million short tons containing 35 or more percent calcium fluoride, of which 13.8 million tons are measured and indicated, and 8.76 million tons are inferred. In addition, there is estimated another 12 million tons of lower grade material. Efficient manufacture would depend on the 35-percent-or-over material. It takes 3 tons of this material to make 1 ton of finished fluorspar. Thus, assuming a continued rate of production no higher than the 619,000 tons consumed in 1957, and assuming that all of the "inferred" bodies can be proven, if U.S. consumption would depend entirely upon these 221⁄2 million tons of reserves, it would be exhausted in about 121⁄2 years. At the rate predicted by Mr. Flynn for acid-grade consumption alone (1 million tons), our reserves would be exhausted in a 7-year period merely in the manufacture of acid-grade fluorspar.

Controversy as to the exact figure of the reserves arises because of a mystic belief in the inexhaustible mineral wealth of this country-a belief akin to the mystic belief of the Indian in the inexhaustibility of the bison. Those whose very existence depends upon continuing supplies of fluorspar-consumers such as the Aluminum Co. of America-do not share this belief (a detailed statement of the rationale of the Aluminum Co. in this regard is made in a statement by that company to the Ways and Means Committee of the House of Representatives, 85th Congress, in re H.R. 10628, H.R. 10726, and H.R. 11781). The substantiality of the belief of the major consumers of fluorspar in the continuing exhaustion of American reserves is indicated by the fact that such consumers as the Aluminum Co. of America, Pennsalt Co., Stauffer Chemical Co., the E. I. du Pont de Nemours Co., and the General Chemicals Division of Allied Chemical & Dye Co., have purchased fluorspar deposits in Mexico in the last few years.

The inference, made in the Senate Interior Committee report on S. 4036, and other inferences in the record of hearings, to the huge reserves of fluorine available in phosphate rock are what might be known as "pie-in-the-sky"-or to be more accurate, "fluorine-in-the-sky" statements. Compelling evidence in that very record of hearings by competent geologists (Hill and Jacob) and an engineering chemist (B. John Shepard), indicate that the theoretical quantity of fluorine contained in phosphate rock certainly cannot be deemed, in any practical sense, as a reserve for the requirements of national security. We do not disagree that there are huge quantities of fluorine contained in phosphate rock; however, to depend upon them for any practical purpose would be like depending on sea water for the manufacture of gold, or coal for the manufacture of diamonds.

As to criterion (4) "the requirements of growth of such industries," we believe that what we have said above as to criteria (2) and (3) is applicable.

(5) Our general views, as stated above, apply to criteria (5) “* * * importation of goods in terms of their quantities ***" and (6) *** "the impact of foreign competition on the economic welfare of individual domestic industries * *

(6) Criterion (7) "And any substantial unemployment ***": "The Minerals and Metals Commodity Data Summaries," prepared by the Bureau of Mines in February 1958, estimates employment of 800 persons at the mines and 700 persons at the mills of all domestic producers. Of the 6 domestic producers of acid-grade fluorspar listed in the McDougal report, 4 are so-called captive producers that is to say, producers all of whose production is used for consumption by themselves or by their affiliates. Since these producers are selfconsumers, it is not likely that market competition in fluorspar will affect their production-although exhaustion of resources may. In any case, excessive imports will not alone cause the suspension of these operations, and consequent

unemployment. We estimate that the so-called captive mines and mills enjoy not less than 30 percent of the total of the overall 1,500 figure of employees given in the "Commodity Data Summaries." This means that there are not more than 1,000 people employed by the independent domestic producers. We would think that if the output of the independent domestic producers were absorbed by stockpile, there should be no unemployment in their operations.

On the other hand, if imports were to be seriously curtailed (as they would be, if the program suggested by the applicant were to be put into full effect), the livelihood of over 100 people in the port of Wilmington, Del., and of hundreds of others in Brownsville and Eagle Pass, Tex., would be seriously jeopardized, since these are the principal ports of entry of imported fluorspar. (7) These remarks apply equally to part of criterion 9, "loss of skills." And by the same token, since we would not expect the domestic mines and mills of the independent operators to close, and since in the case of the largest of these the plant has already been fully amortized through Government purchases, we should not expect the "loss of investment" referred to in the latter part of criterion (9).

(8) Certain statements set forth in our General Views apply to criterion 8 "decrease in revenues of Government ***."

(9) As to criterion (10) "* ** or other serious effects ***" we conclude by saying that, for all of the reasons hereinabove set forth, we apprehend no other serious effects if the domestic industry, represented by the noncaptive producers, be supported by such stockpile purchases as may be necessary, while the taxpayer and the best interests of the United States (both generally and as a matter of national security) are best served by creating no limitations whatsoever on the import of fluorspar.

The CHAIRMAN. Senator Martin.

Senator MARTIN. I asked a question about foreign production this morning. And I would like to inquire if the members of your organization are listed here on page 14 of your statement?

Mr. KARASIK. Yes, sir.

Senator MARTIN. You describe them in general as the fluorspar importers and producers?

Mr. KARASIK. Yes, sir.

Senator MARTIN. Made up of these firms here: Ivanhoe Trading Co., Inc., Associated Metals & Minerals Corp., Arnold H. Miller, Inc., the Ore & Chemical Corp., South American Minerals & Merchandise Corp., and St. Lawrence Fluorspar, Inc.

Mr. KARASIK. Yes, sir.

Senator MARTIN. Now, these foreign sources, import sources, given in his document from the Bureau of Mines titled "Minerals and Metals Commodity Data Summaries," February 1958, show the percentages of fluorspar on page 46: Import sources for the years 1952-56, Mexico 55 percent, Spain 14 percent, Italy 13 percent, Germany 9 percent, and Canada 8 percent.

That is the sources of the fluorspar importation. Your organization is a producing organization as well as importing?

Mr. KARASIK. There are some producers on this list and some importers. They all import.

Senator MARTIN. Yes. Now, I know it is too big a load for you to answer it offhand. But I would like to know what portion of the imports from these countries that I have listed here is produced by your members.

Mr. KARASIK. For an accurate answer, I will have to canvass the membership.

Senator MARTIN. Yes. I would like to have that in the record, if it is convenient.

Mr. KARASIK. During those years what was provided by the members of this institute is what you want?

Senator MARTIN. Yes.

Those figures are given on page 46, import sources for those years from those nations; the percentage from those nations of their imports.

Then I would like to know what portion of those imports were produced by your members.

(The information is now in the committee files.)

Senator MARTIN. Mr. Chairman, I have to leave. I waited here to ask this one question. If you will excuse me.

The CHAIRMAN. I would like to inquire how large are the Ozark Mahoning and Minerva Oil Corps. in comparison with the captive mines? Can you answer that question?

Mr. KARASIK. No. I think that the

The CHAIRMAN. In other words, we want to know: Is the largest independent as large as the smallest captive?

Mr. KARASIK. I think it would be impossible for me to find the answer to that question, Senator.

I think probably the consumers association would be better able to do so. Because their membership comprises some captive producers. And I think even they might have some trouble. Because I don't know whether they know the size of the output of Ozark Mahoning and Minerva.

The CHAIRMAN. Very well.

Thank you.

The meeting will now recess to meet tomorrow at 10 o'clock.

(Whereupon, at 4:08 p.m., the subcommittee recessed, to reconvene at 10 a.m., April 14, 1959.)

PRESERVATION OF THE DOMESTIC FLUORSPAR

INDUSTRY

TUESDAY, APRIL 14, 1959

U.S. SENATE,

MINERALS, MATERIALS, AND FUELS SUBCOMMITTEE
OF THE COMMITTEE ON INTERIOR AND INSULAR AFFAIRS,

Washington, D.C.

The subcommittee met pursuant to recess, at 2 p.m., Hon. Gordon Allott presiding.

Present: Senator Allott.

Also present: Robert W. Redwine, professional staff member, and William Broadgate, mineral consultant to Senator James E. Murray. Senator ALLOTT. The committee will come to order.

The first witness this afteroon is Mr. Walter Seibert.

STATEMENT OF WALTER E. SEIBERT, PRESIDENT, ST. LAWRENCE FLUORSPAR, INC.

Mr. SEIBERT. Mr. Chairman, members of the committee, my name is Walter Seibert. I am an American citizen residing in Westwood, N.J. I am an executive officer and controlling stockholder of four companies in the fluorspar businesses. One company has mines and two mills in Newfoundland, Canada, another company has mines and one mill in northern Mexico, a third company has a drying plant and flotation mill in Wilmington, Del., and a fourth company has a drying plant in Cleveland, Ohio.

I strongly oppose congressional passage of Senator Gordon Allott's bill S. 1285 for the following reasons:

This bill in spite of the efforts to call it a Sugar Act type of bill is nothing more than a quota bill. If enacted, this bill will be the beginning of a change of the whole philosophy of our foreign trade. It will be a precedent for an attempt to put many other commodities and manufactured products under the umbrella of quota protection. This is nothing more than a gimmick to interfere with the free flow of foreign trade and it seems inconsistent that we should attempt such methods when we have been trying to get other countries to eliminate similar trade restrictions such as foreign exchange control, quotas, etc.

Any quota system which will interfere with the free flow of foreign trade will tend to drive up prices of raw materials to this country's manufacturers and will result in the public having to pay higher prices for the finished products where fluorspar is a component part.

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