For that reason all of the lambs we are selling must qualify for the grade standards of U.S. Choice in order to meet that processor's requirements.

The CHAIRMAN. If you eliminate U.S. Choice, you have Swift Choice, Armour Choice, and all of the other big packers.

Mr. MILLER. May I answer that? I slaughter about 600,000 lambs or better a year.

Mr. JENNINGS. What do you do with them?

Mr. MILLER. We sell them principally on the east coast.

Mr. JENNINGS. What grade?

Mr. MILLER. Choice grade.

Mr. JENNINGS. You sell to the kosher trade, and that only takes the front quarter. And you have to dispose of the hind quarter.

Mr. MILLER. With the exception that you are forgetting that all do not grade kosher. It depends on what part of the country they are going into.

When lambs are bred and raised on the same territory all of the time they pick up certain parasites, and this causes what they call little lumps in the intestines. This does not pass the kosher religious test that we have. This is particularly true of those in Virginia where they have very good lambs. But they are a different type of lamb.

Mr. JENNINGS. How old would you say that lamb is?

Mr. MILLER. That, probably, is a year old. Anything that is in the mutton class will not break like this. We call this breaking. Otherwise, this spool will stay on there [indicating].

Getting back to grading, and the question that Mr. Poage brought up yesterday, we do not grade our lambs with any name on them. All it says is, "Miller," and our trademark. We grade according to what our customers want. We give our customers what they want. And we do ship as far as Florida. We ship down to Giant.

You brought up the question of the small packer yesterday. He cannot ship that far. And why is he afraid to ship? We have a perishable product. If we ship it down to Giant and it does not suit them, they say, "They are your lambs." What will we do with them, ship them to Florida 1,500 miles away or back to New York?

We have to give him a product that he wants. That is how we have built our reputation.

Each packer has to know what his individual customer wants. If you send a lamb like this into a small retail shop that has two or three lambs, you will get it back, sure as you live, because he cannot survive on a lamb like this. It can only go to Mr. Petersen or somebody in the hotel supply business.

Mr. PETERSEN. I will not go along with that. [Laughter.]

Mr. MILLER. If I were selling it to Mr. Petersen, it would be too fat. We are looking at it from a different angle. I sell them all over the United States.

Again, Mr. Short, these lambs are of different structures. Those from Mr. Jennings' section and those from Kentucky. They will never get as fat as this. These are fed in a feedlot. This is a different type of lamb entirely.

Your Texas lamb is a different type.

Put yourself in the position of the grader who is grading all Texas lambs he becomes accustomed to those.

This is what we are fighting about. I tried to bring this out. We slaughter these lambs for all of the kosher trade, which means that we slaughter today and we deliver them tonight. Most of this grading is done the following day or two days later, I understand, in the plant, where the graders can see this meat set. They do not do it when it is warm or what we call "hot lambs."

It takes a great deal of experience. We have run into a lot of problems. These are the problems that come up in grading. You will find that it is not consistent. Each grader is not consistent, because he is used to seeing different things.

We have found on the east coast, where we kill as many as on the west coast that that is the fact. Another thing, the chainstores on the east coast, in metropolitan New York, which I am talking about, such as Food Fair, A & P, all of the chainstores, do not demand graded meat. The only one that has demanded it has been Safeway. That was brought in our statement that we did not sell them unless they were short. They are buying graded meat.

Again you have got to go to their warehouses and meet their supervision. You just do not send in the lamb that suits yourself. You have to satisfy the customer. It is not a thing that you can send in. The CHAIRMAN. Thank you very much.

Next on our list is Mr. McGregor. Do you have a statement? Mr. McGREGOR. I only have to say this, that I concur with the testimony already given. And I thank you very much.

The CHAIRMAN. Next is Mr. Albert Mau.

STATEMENT OF ALBERT MAU, KEMMERER, WYO.

Mr. MAU. Mr. Chairman and gentlemen of the committee, I represent the sheepherder end of the growers. I do not know anything except raising sheep and raising lambs. I was going to say something about our sheep in the western part of the United States, especially in Wyoming and Utah and Montana. As long as you are short of time, I will not take up any of your time.

What I would like to do is this, because I will be here in Washington, and if any of your committee wants to know anything about the range business, I will be glad to meet with them and talk with them, because I was born and raised on the range. I do not know anything else. I think however, I could tell you something about that.

The CHAIRMAN. Next on our list is Mr. Kenneth E. Quast of Denver, Colo., the American Sheep Producers Council. Do you want to file a statement?

STATEMENT OF KENNETH E. QUAST, DIRECTOR OF LAMB MERCHANDISING, AMERICAN SHEEP PRODUCERS COUNCIL, INC.

Mr. QUAST. Mr. Chairman and members of the committee, I would like to file a statement. I would like to draw particular attention to the latter part of my statement which, I think, is a summation in essence of this whole problem. This is the last paragraph on page 3 as follows:

While all this controversy has been waging these past months, the industry generally has been quietly and efficiently gearing itself for suspension of lamb grading. As an example, in California, from where most of this fuss has

originated, I will read you from a copy of our fieldman's weekly report dated January 2, 1960:

"Besides the increased demand, shorter supplies of live lambs ready for slaughter developed and the last minute 'flip flop' of the USDA on Federal grading made the shipment of more than 15,000 lambs out of the Imperial Valley in January very unlikely. Had the grading ended on January 4 as announced, some buyers were confident 50,000 lambs would have been 'ready' in January. Here the effect on the feeders is immediate. They will have to finish longer and the lambs will of course get into the dangerously large and heavy category. Even packers (independents) who had either opposed or had been lukewarm to the suspension of grading expressed themselves as disappointed by the last minute switch. They, together with most retail chains, had gotten used to the idea and they were anxious to see what the experiment would do. Many chains had planned to 'roll their own' lambs with their private brand. All packers had set up house-brand advertising. Now this awaits further action."

I would like to enter the entire statement.

The CHAIRMAN. All right, that may be done. We thank you very much.

(The prepared statement of Kenneth E. Quast is as follows:)

STATEMENT OF KENNETH E. QUAST, DENVER, COLO., DIRECTOR OF LAMB MERCHANDISING, AMERICAN SHEEP PRODUCERS COUNCIL, INC.

My name is Ken Quast, and I am director of lamb merchandising for the American Sheep Producers' Council. My background and experience is 25 years in meat sales and merchandising, including 5 years meat merchandising with small independent retailers belonging to a voluntary group. In addition I have several years' experience contacting and selling to food chains. I have also some experience store testing evaluating consumer reaction on various meat products by observation and direct contact. I have been with the council for 21⁄2 years in my present position.

The American Sheep Producers' Council representing some 268,000 sheep producers in over 3,000 counties across the Nation, is organized to promote the products of their industry-lamb and wool. By authority of its board of directors and the Secretary of Agriculture, we are currently spending over $1,350,000 to promote lamb. The purpose of spending this money contributed by the growers, is to expand the demand for lamb so that the marketing of same will provide a satisfactory return to the producer.

We are currently promoting lamb in 21 major cities across the country, not by any grade or any label, just lamb, and have 11 merchandising fieldmen contacting all segments of the meat industry in those cities. Not once, but a number of times our men have reported that retailers who specify and feature U.S. Choice lamb as saying they could not promote in support of a particular campaign of ours, because they couldn't purchase enough U.S. graded Choice lambs to satisfy their needs for such a promotion. Other retailers in the same area not demanding federally graded lamb have been easily able to obtain sufficient for promotions, and cooperate fully with our program in addition to satisfying their customers.

Some retailers feel that lamb buying by Federal grade facilitates their operation *** however, it would also appear to complicate his selling and merchandising of the retail cuts, because they publicize how they trim off excess fat to make the lamb acceptable to their customers.

In modern meat merchandising at retail, communication is largely lost be tween Mrs. Consumer and the meat man. True, she can ring a bell if she wants personal service, but by and large she makes her selection at the self-service meat counter from a display of lamb already packaged. In preparing this lamb for display, the retailer who buys by Government grade has trimmed off the identifying grade label, with the possible exception of whole legs and whole shoulder roasts. Thus consumers have difficulty identifying retail meat packages by Government grade. Surveys prove in any event, that Mrs. Consumer does not buy by grade, but makes her meat selection according to size of meat package for her needs, appearance, price, and the reputation of the retailer where she is dealing.

There is also a vitally important point that cannot be overstressed * * * we must be sure Mrs. Consumer is not confused as between Federal grading and Federal inspection. Federal grading has to do with degrees of quality by visual arbitrary standards. Federal inspection has to do with the wholesomeness and cleanliness of lamb slaughtered for human consumption. There is no question about suspension of Federal inspection here * * * the sheep industry commends Federal inspection as a necessary service to safeguard the health of the people.

Lastly, some proponents for lamb grading have indicated that confusion would reign in the industry, and that big packers and big food chains with fat advertising budgets would be the only survivors. First of all, the total lamb consumption in the United States is only 4 pounds per capita per year *** it doesn't represent a sufficient share of any packers' or retailers' business to force him to "go broke." We hope to raise this figure by increased production backed by our promotional efforts *** but never has lamb exceeded 7 pounds per capita consumption. This averages about 2.8 percent of the total per capita red meat consumption. Secondly, my own experience has been that more small independent retailers buy "packer label,” or “unbranded" lamb, * * * yet they successfully survive day-by-day competition and satisfy their customers.

While all this controversy has been waging these past months, the industry generally has been quietly and efficiently gearing itself for suspension of lamb grading. As an example, in California, from where most of this fuss has originated, I will read you from a copy of our fieldman's weekly report dated January 2, 1960:

"Besides the increased demand, shorter supplies of live lambs ready for slaughter developed and the last minute 'flip flop' of the USDA on Federal grading made the shipment of more than 15,000 lambs out of the Imperial Valley in January very unlikely. Had the grading ended on January 4 as announced, some buyers were confident 50,000 lambs would have been 'ready' in January. Here the effect on the feeders is immediate. They will have to finish longer and the lambs will of course get into the dangerously large and heavy category. Even packers (independents) who had either opposed or had been lukewarm to the suspension of grading expressed themselves as disappointed by the last minute switch. They, together with most retail chains, had gotten used to the idea and were anxious to see what the experiment would do. Many chains had planned to 'roll their own' lambs with their private brand. All packers had set up house brand advertising. Now this awaits further action."

Mr. LEVERING. I ask unanimous consent to enter into the record a telegram from the Ohio Farm Bureau Federation, and certain other telegrams from other people.

The CHAIRMAN. All right, that may be done, without objection. (The telegrams referred to are as follows:)

Hon. ROBERT W. LEVERING,

Member, House Agriculture Committee,
Washington, D.C.:

COLUMBUS, OHIO, January 11, 1960.

We wish to commend the House Agriculture Committee for the interest it has taken in the lamb grading issue. Delegates at our annual meeting, representing 54,000 Ohio farm families, adopted the following resolution with respect to voluntary Government meat grading programs:

"We recommend that the voluntary Government grading program for lamb and beef be continued and revised where necessary to meet changing consumer demand.

"We further recommend that a possible program for pork grading be explored."

We fail to see any benefits that would accrue to farmers by eliminating Government grading program on either lamb or beef. The fact that about 35 percent of the lamb and 50 percent of the beef marketed is granted indicates that the program is useful. Eliminating the voluntary grading program would work a hardship on farmers and some processors and retailers by:

1. Eliminating an unbiased set of standards for communication within the industry. Substituting personal visits and other means for the purchasing of meat and livestock would increase costs of marketing and possibly depress prices to farmers.

2. Render Government price reporting services practically useless because there would be no common language for communication price. Hence the farmers would be at the mercy of the livestock buyers.

3. May discourage consumer purchases of meat inasmuch as the consumer could not be assured of getting the same quality of meat from time to time.

We believe that elimination of voluntary Government grading programs would set the livestock industry back 30 years. Therefore, we strongly urge that you use your influence in retaining this important Government service.

Hon. ROBERT W. LEVERING,
Washington, D.C.:

D. R. STANFIELD, Ohio Farm Bureau Federation.

MOUNT VERNON, OHIO, January 11, 1960.

I am opposed to the present form of lamb grading. I suggest to contact Mr. Benson to postpone lamb grading for 1 year. Lamb should be graded by merit, not by stamp.

J. G. LEVERING.

Hon. ROBERT W. LEVERING,

Representative, Washington, D.C.:

COLUMBUS, OHIO, January 11, 1960.

The Independent Livestock Marketing Association of Ohio urges suspension of Federal lamb grading for a period of 1 year primarily to give the Department further time for investigation and analysis and at the same time give retail buying agencies opportunity to make purchases on a merit basis reflecting quality based on consumer demands. This we feel will also result in price advantage to lamb producers. Retail buyers should not be able to use Government grades as a club to beat down prices. Careful observation and study for a year should tell the story.

J. R. ALLGYER,

Executive Secretary, Independent Livestock Marketing Association.

FOSTORIA, OHIO, January 11, 1960.

Hon. ROBERT W. LEVERING,

Congressman, Washington, D.C.:

We would like to go on record as being opposed to the Federal lamb grading as it now exists. Would favor 1-year suspension as recommended by the Agriculture Department.

Very truly yours,

WARD LIVESTOCK CO.

MOUNT VICTORY, OHIO, January 11, 1960.

Representative ROBERT W. LEVERING,

Washington, D.C.:

DEAR MR. LEVERING: Farmers in this area are opposed to lamb grading in its present form. We desire that you support the 1-year suspension as recommended by the Department of Agriculture.

C. K. ELLIOTT.

Mr. STRATTON. Could I enter this telegram into the record?

The CHAIRMAN. You may.

(The telegram from the Western States Meat Packers Association,

Inc., is as follows:)