My question and point is this. Why did not the Department take action in 1955 and especially in 1956 to encourage the production of the heavybodied tobacco having the flavor, body, and aroma required for filter-tip cigarettes and discourage the production of the heavy-yielding, pale, slick tobaccos which have contributed so much. to the present excessive stock held by the Stabilization Corporation? It appears to me that this could have been done in 1956 by increasing the support level on the grades in demand and by materially reducing or eliminating price supports on the pale, slick grades as was belatedly done just a short time ago for 1957. It appears to us that the Department was at least a year late in awakening to the fact that there was very little, if any, market for the so-called pale, slick tobaccos. It is my belief, Mr. Chairman, that had the Department eliminated or materially reduced price suports on the undesirable grades in 1956, that it is altogether possible that 100 million less pounds of tobacco would be in our stocks today. I cannot blame the tobacco farmer for producing just as many pounds per acre as he possibly can. If he didn't some of our friends would probably begin calling him an inefficient farmer and suggest that he ought to get out of agriculture and look for a job in the factory or the mills. I cannot blame the tobacco farmer for growing coker 139 or 140 in 1956 if he thought he would make more money. But I do blame the United States Deparrment of Agriculture for not realistically setting grade support prices in 1956, so as to encourage this farmer to grow the kind of leaf the present market is demanding. The points I have cited are the reasons I say that the present oversupply of flue-cured tobacco which resulted in a 20-percent cut in 1957 acreage is not entirely the fault of the farmer and, therefore, he should not be unjustly penalized without compensation. One way of correcting this situation is by authorizing soil-bank payments to partially compensate the tobacco growers for the 20-per cent cut in acreage. We would strongly urge this course of action. In the interest of justice and fair play I urge that this committee act favorably on House Resolution 768 pertaining to flue-cured tobacco and on House Resolution 4690 pertaining to fire-cured tobacco. I wish to thank the committee for its patience and for the privilege of presenting our views. Mr. ABBITT. Thank you very much. We appreciate so much other Congressmen coming and attending. If they would like to be heard first, we would be glad to hear from each one of them, or we would be glad to discuss the matter with them and get whatever information they have. Would you like to just sit here with us and discuss the thing generally? Mr. LENNON. Is that the purpose of this hearing, to discuss it? I might desire to make a statement for the record later on. Mr. ABBITT. We are just having a more or less informal hearing here this morning. We have some information from the Department. They have brought it. They are not prepared to give us any decision at this time, but they are over here to give us any information that we would like to have now. Mr. MCMILLAN. Mr. Chairman, I have a statement from the South Carolina Tobacco Warehouse Association and some other statements that I would also like to have inserted in the record at this point. Mr. ABBITT. Without objection, they will be made a part of the record at this point. (The documents referred to are as follows:) Hon. J. L. MCMILLAN, House Office Building, Washington, D. C. LAKE CITY, S. C., March 13, 1957. To the CHAIRMAN, TOBACCO SUBCOMMITTEE, HOUSE COMMITTEE ON AGRICULTURE. The South Carolina Tobacco Warehouse Association strongly supports and advocates the passage of proposed legislation providing for payments from the soil-bank program to flue-cured growers for the 20 percent acreage cut in fluecured tobacco production for 1957. Along with productions from other States in the belt South Carolina growers accepted a 12 percent cut in 1956. This reduction in acreage with a lower yield per acre than in 1955 resulted in a decline of $18 million revenue to farmers. With the announced 20 percent cut in acreage quotas for 1957 and the probable additional 10 to 12 percent reduction in pounds as a result of the almost complete elimination of black-listed high-yielding varieties growers' income will become drastically reduced. Under these conditions the farmers face a very serious situation and unless some provision for help can be made many growers already having to seek employment elsewhere will have to give up farming entirely. The inclusion of soil-bank payments for this 20 percent will relieve to a great degree much of the economic hardship now facing our growers. Tobaccogrowers generally have accepted any reduction in production to keep supplies in line with demand and have voted overwhelmingly for quotas to limit production on each occasion with exception 1939 crop. With the sudden shift in demand of types of tobacco due to marked changes in consumer smoking habits brought on by filter-tip cigarettes growers are faced with serious problem of turning away from high-yield incentives through which they have for 2 or 3 years been able to increase net income. We strongly urge passage of this legislation. This association also supports the proposal for sales of surplus tobacco now being held under loans. More specifically it supports any plan to remove from stock those tobaccos termed undesirable or "pale, slick, neutral types" at a price the market will accept. To hold these types in stock, with additional storage and other costs over a period of years will further aggravate the problem of production of sufficient quantities of desirable types in that these tobaccos will be counted as merchantable acceptable tobaccos in computation of the quotas from year to year. With the current heavy supplies of mild types tobacco already on hand and the continual weakening demand for neutral types, it is our feeling as much of this tobacco as is possible should be moved at once. With the information presented by United States Department of Agriculture officials and others in the trade we can see no immediate prospects or opportunity to sell these tobaccos at the values normally assigned for such grades. SOUTH CAROLINA TOBACCO WAREHOUSE ASSOCIATION. Hon. JOHN L. MCMILLAN, COLUMBIA, S. C., January 14, 1957. House Office Building, Washington, D. C.: Following wire sent Secretary Benson this date: On acreage of tobacco which may be placed in soil bank for 1957 and payment for same, you are urged to allow 5 acres or 50 percent, whichever is greater, with a payment of 25 cents per pound. I particularly urge the 5 acres rather than the proposed 3 acres for the reason there are many small contracts with an allotment just a few tenths of an acre above 3 acres. The planting of a few tenths above would not justify expense of planting and operating a curing barn. As a result, I fear many farmers with small allotment just above the 3 acres would not place their tobacco allotment in soil bank where otherwise they would, and there are many of these. I urge payment of 25 cents per pound because it would be fairer and more equitable and in line with payments made on other crops. South Carolina tobacco farmers need the 5 acres or 50 percent, whichever is greater, more in 1957 than they did in 1956. WILLIAM L. HARRELSON, South Carolina Commissioner of Agriculture. Hon. JOHN L. MCMILLAN, MYRTLE BEACH, S. C., January 5, 1957. Member of Congress, Washington, D. C. DEAR MR. JOHN: The farmers of Horry County are relying on you to aid them with this drastic 20 percent acreage cut we received from the Secretary of Agriculture. As you know, I am chairman of the Agriculture Stabilization and Conservation Committee of Horry County. The problems of the farmer are increasing daily and the size of the tobacco allotments in our county are getting smaller and smaller. I signed over 300 allotments smaller than 1 acre. I hope you can introduce your bill in Congress to pay the farmer for their 20 percent cut through the soil bank. I would like to see your bill on putting this surplus tobacco on the world market at some price. The only phase of the Department of Agriculture's regulations I can approve is the 50 percent support on the varieties that are not suitable for the tobacco companies. I know the pressure has been put on you to fight this, but for the betterment of the tobacco program I think we should not plant a type of tobacco that the tobacco companies say they do not want. I have planted it, made money on it, and yet I knew it was going to hurt the program. I haven't talked to a farmer in the county who is going to plant either of the varieties that will be supported at 50 percent. During the marketing season, I am on a tobacco market almost every day, and I haven't found a buyer, circuit rider, tobacco company representative, say they wanted a basket of the tobacco, or could use any of it. Why plant a variety that isn't desirable? It doesn't feel like tobacco, smell like tobacco, or burn like tobacco. I have high regards for Coker Seed Co., and Dr. Rogers. They have helped the farmer in improving the seed industry in several crops. This tobacco was bred for plain cigarettes, and the modern smoker has gone filter. The Farm Bureau president and our member of the tobacco committee, agrees with me on the idea. I talked with him today. Farmers are coming to me daily and nightly wanting help. You know that the ASC committee has only a small amount to help them with. I have planned for the past month to write you on the matter in our county. The amount of soil bank money that we will receive won't help much either. I am having a hard time trying to serve my county as ASC chairman. As a committeeman I can't say what I want to about the Republican Party, but as a farmer, I can. I will count on you doing all you can for the farmer in the future as you have in the past. If I can be of any service to you at any time, please call on me. I wish you grest success in Congress this year. I remain, Sincerely yours, JOHN H. ATKINSON, Jr. SOUTH CAROLINA FARM BUREAU, INC., Hon. JOHN L. MCMILLAN, House of Representatives, Washington, D. C. DEAR MR. MCMILLAN: At a meeting of the 15 man South Carolina Farm Bureau Tobacco Committee held in Florence on January 2, 1957, unanimous agreement was reached by 12 members present directing me to inform you as follows: "We approve efforts to get a part of the surplus tobacco held by the Flue Cured Tobacco Stabilization Corporation into the world market at its market value provided local market conditions will not be disrupted." Respectfully submitted. Hon. JOHN L. MCMILLAN, E. H. AGNEW, President. R. J. REYNOLDS TOBACCO Co., Winston-Salem, N. C., December 4, 1956. House of Representatives, Washington, D. C. DEAR CONGRESSMAN MCMILLAN: In connection with the hearings held yesterday by the Tobacco Subcommittee of the House Committee on Agriculture, I enclose a copy of a letter that Mr. Darr is sending to Hon. Watkins M. Abbitt, chairman of the subcommittee. Very truly yours, H. H. RAMM, General Counsel. Hon. WATKINS M. ABBITT, R. J. REYNOLDS TOBACCO Co., Winston-Salem, N. C., December 4, 1956. House of Representatives, Washington, D. C. DEAR CONGRESSMAN ABBITT: In the course of my remarks at the hearing yesterday, I indicated that if the pale, slick tobaccos on hand could be removed from inventories and destroyed, little, if any, acreage reduction in the flue-cured program would be required for 1957. On the basis of the figures submitted by the Department of Agriculture at the hearing, the validity of my statement is apparent. The below computation is made on the basis of the Department's figures, adjusted for the removal from inventories of 200-million pounds of this tobacco. The figures are as follows: Based on the average per acre yield during the period 1951-55 of 1,308 pounds, the production of 1,172,000,000 pounds would require 896,000 acres, or almost 16,000 acres more than that harvested in the 1956 crop. According to the press reports this morning, I understand that Mr. Weeks stated that the quantity of pale, slick tobaccos on hand was about 150 million rather than the 200 million pounds that I referred to in my statement. Since, as pointed out in my statement, much of this tobacco is not identified as such by marks, the actual quantity on hand is probably unknown. Whether the figure is 150 million pounds or 200 million pounds, it seems apparent that if this tobacco is removed from inventories little, if any, reduction in the 1957 quota is needed. This will be particularly true if this undesirable type of tobacco is not supported, as the yield per acre will then be reduced and perhaps approximate the yield for the 1951-55 period. On the basis of the announced acreage quota for 1957 of 712,600 and assuming that in the next crop year the production per acre is the 1951-55 average of 1,308 pounds, the total flue-cured production would be 932,080,000 pounds, or some 349 million pounds less than the disappearance for the 12 months ended July 1, 1956. If the same number of acres should be planted next year as were this year, that is 880,000, and assuming a production of 1,308 pounds per acre, total production in 1957 would be 1,151,300,000 pounds, 130 million less than the disappearance during the 12 months ended July 1, 1956. This 130 million pounds, plus the quantity of undesirable tobaccos that would be removed from inventories should my suggestion be followed, would reduce stocks to a level that I believe would not be excessive. I am sending a copy of this letter to the other members of the Tobacco Subcommittee, as well as Congressman Cooley and other Members of the House of Representatives present; namely, Congresswoman Blitch and Congressmen Bonner, Fountain, and Lennon. A copy of the letter is also going forward to Under Secretary of Agriculture True D. Morse and to Mr. Joe R. Williams, Acting Director of the Tobacco Division of the Department. Again let me thank you for the opportunity to be heard by your subcommittee. Sincerely yours, E. A. DARR, President. Congressman JOHN L. McMILLAN, LATTA, S. C., December 31, 1956. Washington, D. C. Congressional Office Building, DEAR CONGRESSMAN MCMILLAN: I am just writing to protest the recent 20percent cut in tobacco acreage. The cuts had already gone to the bone and this last goes all the way through the bone and leaves nothing to stand on. Such a cut means destruction to the farmer. May I suggest that you and your fellow Congressman strive for legislation which will allow this 20-percent cut to be absorbed by way of the soil bank? It seems to me that is the only solution which will not work an unbearable hardship on the farmer. Best personal wishes for you in this new year. Sincerely, Senator JOHN MCMILLAN. ANDREW C. ASTON, SALTERS, S. C. DEAR SIR: Please use any influence you may have to help small farmers such as my husband and myself. We own a small 24-acre farm which we have farmed since 1940. We started out with allotments sufficient to earn a reasonable living on our farm, with the help of the FHA from whom we borrowed several hundred each year to finance our operations. Down through the years our allotments have grown smaller and smaller. Now this year we only have 0.98 of an acre of tobacco and 4 acres of cotton. Due to a ruling that you must have 2 acres of tobacco and 5 cotton we are not eligible for an FHA loan. It is impossible for us to get a loan elsewhere. Please use your influence to change this ruling as it is working a grave hardship on hundreds of little farmers in our county, both white and Negro. Thanking you for anything you can do to help. Yours truly, Mrs. C. W. MORRIS. FINAL FIGURES FOR 1956 TOBACCO SALES RELEASED "A final report from the auction markets in South Carolina show a total sale of 146,170,679 pounds of tobacco for $76,529,067 in 1956. This compares with sales of 174,737,503 pounds for $95,332,494 in 1955," said Agriculture Commissioner William L. Harrelson today. These reports to the State department of agriculture show only 3 markets operating during the last report month, and these were Lake City, Mullins, and Timmonsville, the other 8 market centers having previously closed for the season. The average price for the 1956 crop was $52.35 a hundred pounds. In 1955 the crop averaged $54.55. South Carolina tobacco producers received $18,803,427 less for the crop this year than they did in 1955. Hon. JOHN L. MCMILLAN, Florence, S. C. LATTA, S. C., December 4, 1956. DEAR CONGRESSMAN MCMILLAN: According to the newspapers there is to be a 20 percent cut in tobacco acreage. It was my understanding that the one and only purpose of the "soil bank" was to reduce the acreage. If the soil bank is to be used for that purpose, why is it necessary to make an additional cut? I had an allotment of 16.92 acres last year and, according to the papers, I would be allowed to put 8.41 in the soil bank. This I had planned to do. My neighbor, who has a larger allotment than I have, had planned to do the same thing. It seems to me that the soil bank would have reduced acreage to the point that another cut would not be necessary. Frankly, I think this is another means of booting the farmer. I am wondering if the soil bank was just another campaign lie. I cannot conceive of any fairminded person offering the soil bank and then making a mandatory cut in addition to it. I hope that you can do something to make the matter more just for those who are trying to eke out an existence trying to produce food and fiber for the people of America. Yours sincerely, ANDREW C. ASTON. 20119-57-5 |