Mr. HARDY. It is interesting. Senator Moss. Of course I was interested too in the number of these that were captive mines as against independent ones. Mr. HARDY. We would be very happy to develop that information for the record, sir. Mr. REDWINE. I wonder if the Secretary could furnish us also on a confidential basis a company-by-company projection-on a confidential basis? Senator Moss. The staff requests that we have a company by company projection on a confidential basis. Mr. JOSEPHSON. No. I am afraid we Mr. HARDY. Mr. Chairman, I think it would be difficult for us to do that, because this material is given to us on a confidential basis. We might be able to show it to you, but I would have to check into the aspects of that. If possible, we will certainly do as much as we can. Senator Moss. If you will check that and let me know so that we know whether the staff can examine it or whether it can be put in the record. Do you have anything further? Mr. BROADGATE. I have nothing further. Mr. REDWINE. I have nothing further, except, Mr. Chairman, may the report of the Bureau of the Budget appear in the record at this place? Senator Moss. Yes, Mr. Redwine. (The report is as follows:) Hon. JAMES E. MURRAY, EXECUTIVE OFFICE OF THE PRESIDENT, BUREAU OF THE BUDGET, Washington, D.C., April 6, 1959. Chairman, Interior and Insular Affairs Committee, MY DEAR MR. CHAIRMAN: This is in reply to your letter of March 10, 1959, inviting the Bureau of the Budget to comment on S. 1285, a bill to provide for the preservation and development of the domestic fluorspar industry. The bill provides that the Secretary of the Interior would determine the amount of fluorspar needed to meet the requirements of consumers in the United States at least annually. Based on such requirements, the Secretary would establish quotas for the United States and for foreign countries in accordance with certain criteria, with provision for adjustment for unwarranted domestic price increases and relief for foreign producers through barter contracts for surplus agricultural products. The quotas could be suspended by the President in the event of a national or other emergency with respect to fluorspar. The Office of Civil and Defense Mobilization determines the inventory needed to provide for our defense needs of fluorspar pursuant to the Strategic and Critical Materials Stockpiling Act. These stocks, together with anticipated supplies from domestic and nearby foreign sources, provide for our national defense requirements for fluorspar in the same manner as for other stockpiled materials. Should future changes require a different level of inventory, or other action for defense reasons, adequate authority is provided, not only under the Stockpile Act, but also under the Defense Production Act and the Trade Agreements Extension Act of 1958, to initiate such other programs as may be necessary. The Office of Civil and Defense Mobilization has recently undertaken a study of the defense needs for fluorspar pursuant to the section 8 of the Trade Agreements Extension Act of 1951, as amended, to take action if imports of commodities which have been the subject of a trade agreement cause or threaten injury to domestic industry. In view of the adequacy of present authorities under existing law to meet defense needs and the fact that present law provides a basis for relief where tariff concessions injure or threaten to injure domestic industry, the Bureau of the Budget recommends that S. 1285 not be enacted. Sincerely yours, (Signed) PHILLIP S. HUGHES, Assistant Director for Legislative Reference. Senator Moss. Thank you very much, Mr. Hardy and gentlemen. This subcommittee hearing will recess now. We will reconvene at 10 o'clock Monday morning, the 13th of this month. (Whereupon, at 12:25 p.m., the subcommittee hearing was recessed.) PRESERVATION OF THE DOMESTIC FLUORSPAR INDUSTRY MONDAY, APRIL 13, 1959 U.S. SENATE, MINERALS, MATERIALS, AND FUELS SUBCOMMITTEE OF THE COMMITTEE ON INTERIOR AND INSULAR AFFAIRS, Washington, D.C. The subcommittee met at 10 a.m., pursuant to recess, in room 3110, Senate Office Building, Senator James E. Murray (chairman) presiding. Present: Senators Murray, Allott, and Martin. Also present: Robert W. Redwine, professional staff member; and William Broadgate, mineral consultant to Senator Murray. The CHAIRMAN. The hearing will come to order, please. This is a continuation of the hearings on S. 1285 to determine if this country is to have a domestic fluorspar industry or be content to rely upon foreign sources for our supplies of this highly strategic material. I was greatly disappointed at the testimony of the Department of Interior on last Friday. The Department did a complete rightaboutface from its position of less than a year ago. I cannot understand such shifting of position and change in viewpoint. There must be more to it than meets the eye and it shall be my purpose to try to get to the bottom of the matter. The first witness will be Mr. C. O. Anderson. You may proceed, Mr. Anderson. STATEMENT OF C. O. ANDERSON, PRESIDENT OF OZARK-MAHONING CO. Mr. ANDERSON. Thank you, Mr. Chairman, and members of the committee. My name is C. O. Anderson, associated with the Ozark-Mahoning Co. and its predecessor companies for 33 years, during the last 6 of which I have served as president. I appreciate the opportunity of presenting this statement. In 1936 our company began prospecting for and developing fluorspar ore deposits in the Illinois-Kentucky district located on both sides of the Ohio River. After much research work on devising milling methods for the complex ores discovered, a plant was built at Rosiclare, Hardin County, Ill., early in 1939 to process these ores. Marketing of the four products, acid grade fluorspar, metallurgical fluorspar, zinc, and lead concentrates, began later that same year, and except for a 2-month strike and some force majeure conditions at times, has operated up to the present time. 71 During 1958 the plant produced and sold 48,136 tons acid-grade fluorspar concentrates, and 6,363 tons zinc concentrates, but no lead and no metallurgical-grade fluorspar concentrates. This represented about 95 percent capacity of the plant. At no time has our company been able to sell to the GSA stockpile any of its metallurgical-grade concentrates because pellets were considered unacceptable. We have at one time or another sold acid-grade fluorspar to nearly every major consumer in the United States; we have lost the business of many of them with the only reason being our inability to meet the low prices of the imported material produced at excessively low costs of labor as compared to the domestic costs of the same item. We have sought to meet the foreign competition by practicing many economies and in spite of the ever-increasing costs of labor, supplies, et cetera, by making a series of price reductions. Effective January 1, 1959, we reduced the acid grade fluorspar price to $45 f.o.b. Rosiclare, and still during the first calendar quarter of this year we could sell only about 60 percent of our capacity. With such low volume and such a depressed price our company has operated during 1959 in the red as regards fluorspar and can show an overall small profit for its Rosiclare operations only by absorbing the fluorspar red figure in the modest profit from the zinc concentrates. During the Rosiclare plant operations we have shipped in excess of three-quarter million tons of fluorspar concentrates after being told in about 1938 by many so-called well-informed people that the Rosiclare district was exhausted and almost worked out. Our company now has 1.5 million tons of measured ore reserves and an equal tonnage of probable ore reserves as well as much undeveloped acreage. These figured reserves are adequate for 20 years' operation at the rate observed in 1958. No incentive exists now to expand those reserves and we have largely ceased our search for new fluorspar reserves. In March 1946 our company purchased the Wano mill at Jamestown, Boulder County, Colo., from H. M. Williamson & Son, and leased from Boulder Fluorspar Co. certain fluorspar mining properties which were in turn contracted to the Williamsons for mining. Except for occasional force majeure conditions, this plant operated continuously to July 1957, when the principal customer, Reynolds Metals Co., began to operate its own plant based on imported crude ores. From about July 1957 to December 27, 1958, the Wano plant shipped primarily to GSA on contract under Public Law 733 and then shut down on the latter date for an indefinite period, or at least until some relief may be forthcoming from passage of S. 1285. Our entire Jamestown personnel has gone already and reassembly of such personnel is usually an expensive experience. Our company operated this project for nearly 13 years and shipped in excess of 115,000 tons of concentrates. During the early years, known ore reserves were never available for more than 3 to 6 months ahead, but now ore reserves after such a long period of operation are adequate for at least 4 to 5 years, and probably far in excess of 10 years, at the rate observed during 1958 when 11,000 tons of concentrates were produced during 11 months. The loss of the $100,000 milling plant payroll in 1958, plus at least an equal amount for the mining payroll, plays havoc in a multitude |