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Plans for fiscal year 1964

The collection, analysis, and dissemination of world production, trade, and marketing information will be continued, and further refinement of production estimating techniques will be emphasized. Programs and policies in producing and consuming countries will be studied to determine how they affect patterns and trends in world production and trade. We will continue to work with the International Coffee Agreement on statistical and economic matters.

World situation

COCOA BEANS

The sharp upward trend in world cocoa production appears to be leveling off. The 1962-63 world crop of about 1,180,000 metric tons is only slightly above 1961-62 but below the record 1960-61 outturn of 1,187,000 metric tons. Prices have strengthened somewhat but are still rather low and inventories in consuming countries are large. World consumption has been increasing at a fast rate over the past several years and it will probably be near production this

season.

The potential demand for cocoa beans is difficult to measure. Increase in consumption would be even greater except for the large use of substitutes. Short-term outlook

Cocoa bean stocks are expected to continue at a high level for sometime. World consumption continues to increase. The amount of increase will be determined by price levels. Should prices advance substantially above present levels, users will tend to revert back to substitutes. The United States is the world's largest consumer of cocoa beans, historically taking about one-third of the total quantity entering international trade.

Long-term outlook

Historically there has been a delicate balance between the world supply and demand for cocoa beans, characterized by sharp fluctuations in prices. Present excess inventories are the result of a succession of large crops. Over the past several years, efforts have been directed by producing and consuming countries to develop an international arrangement aimed at providing ample supplies with only moderate price fluctuations. Over the long run both production and consumption could be considerably higher with reasonable stability for both producer and consumer.

Plans for fiscal year 1964

The supply and demand situation of cocoa beans and its products will be analyzed on a continuing basis and pertinent information disseminated as feasible. Additional emphasis will be placed on the factors affecting the changes in the world pattern of trade in this commodity. Material will be furnished international agencies and cooperation will increase in efforts to develop an international commodity arrangement for cocoa.

VEGETABLE FIBERS (EXCEPT COTTON)

World situation

The combined 1962 production of hard fibers for cordage and bagging (sisal, abaca, and henequen) was nearly 8 percent below 1961 but about the same as in previous recent years. Sisal production fell nearly 8 percent and henequen about 1 percent from 1961, but abaca rose slightly from the preceding exceptionally small crop. Of the soft fibers, flax production increased but failed to regain the loss in production in 1959 and 1960. Production in the Soviet Union, the largest producer, remained at a relatively low level compared with 1956-58. Jute fell about 9 percent from the record crop of 1961.

Production in 1962 in millions of pounds was: sisal, 1,278; abaca, 222; henequen, 357; jute, 5,000; and flax, 1,365. Interest in kenaf continued in many countries with Thailand showing the greatest increase. Ramie production showed little change.

Prices of sisal and henequen rose above the 1961 level and neared the 9-year peak of 1960, the price of abaca fell throughout the year and averaged the lowest since 1956. Flax prices changed little in 1962 as supply and demand continued well in balance.

The United States imports its entire requirement of these fibers. It takes nearly all of Mexico's henequen and istle fiber and products, nearly a third of

the Philippine's abaca exports, and ranks with the United Kingdom and West European countries among the world's largest importers of sisal, jute, and flax fibers and products.

Short-term outlook

Sisal production is expected to show little change, henequen and abaca will probably increase somewhat. Prices of these fibers will probably not change significantly but may each continue its general trend of 1962.

Flax production may increase some but no significant change is expected in either supply or price. Mexican istle is usually produced according to demand, and little change is expected in supply, demand, or price of hemp, istle, or other minor fibers.

Long-term outlook

Sisal is expected to change gradually from adequate to plentiful supplies with lower prices. Henequen will probably continue its present pattern of gradual increase in supply and demand, but production gains may begin to level off somewhat after the next 5 or 6 years with an attendant stiffening in price.

Jute supplies will probably be sufficient for demand with some ups and downs from year to year. The Pakistan Government has requested a United Nations study group on jute to assist in stabilizing production and prices. Flax and hemp are not expected to regain their former position in the fibers field because of competition from synthetics. Kenaf and ramie will remain in the category of minor fibers.

Plans for fiscal 1964

Publication and dissemination of information will continue on world production, trade, price, supply, and development of the principal vegetable fibers, other than cotton. Contributions will be continued as requested to international agency studies. We expect further intensification in relation to efforts in this field because of requests to the United Nations for special activity in relation to both jute and hard fibers, and increased developments concerning world trade. The study on U.S. imports (quantity and value) of all these fibers will be brought upto-date and published.

Mr. WHITTEN. Mr. Secretary and Mr. Ioanes, we wish to thank you for an informative persentation. We haven't taken up as much time with the detail of personnel and things of that nature. But more and more it becomes apparent that if we are to keep this balance and keep world markets, we are dependent upon your organization. Apparently you folks are getting along, and we may forget about insisting on the sales manager being over at the corporation. But I do wish to thank you for a very fine presentation.

Mr. RENNE. Thank you.

Mr. IOANES. We wish to thank all of you very much.
Mr. WHITTEN. Thank you.

95910-63-pt. 3-68

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