TABLE III.-Government inventories, materials without stockpile objectives, as of June 30, 1967 Materials in the supplemental stockpile on June 30, 1967, had an acquisition cost of $1,435,517,700. This represented an increase of $27,854,300 in the inventory's cost value during the past year. There was a decrease of $10,781,600 in the cost value of strategic and critical materials in the Commodity Credit Corporation inventory during the same period. The supplemental stockpile had a market value estimated at $1,329,698,100 as of June 30, 1967, which was $21,194,600 higher than a year earlier. Most materials in the supplemental stockpile have been acquired from the exchange or barter of surplus agricultural commodities. Materials having a cost value of $27.5 million were acquired under Public Law 733 (Domestic Tungsten, Asbestos, Fluorspar, and Colum bium-Tantalum Purchase Act of 1956) and transferred to the supplemental stockpile. The Commodity Credit Corporation Charter Act was amended in 1949 so as to provide additional authority in the Commodity Credit Corporation to acquire strategic and critical materials by exchange. Normal trade channels were to be utilized, and priority given to commodities easily storable and those which serve as prime incentive goods to stimulate production of critical and strategic materials. The quantities and qualities of the materials were to be determined under section 2 of the Strategic and Critical Materials Stock Piling Act. Strategic and critical materials acquired in exchange for agricultural commodities to the extent approved by the Munitions Board, were to be transferred to the stockpile, and CCC was to be reimbursed from stockpile funds for the fair market value of the materials. Section 104 of the Agricultural Trade Development and Assistance Act of 1954 (Public Law 480, 83d Cong.) authorized the President to enter into agreements with friendly nations to use the foreign currencies accruing under the act for several purposes. The foreign currencies could be used to purchase strategic and critical materials within the applicable terms of the Strategic and Critical Materials Stock Piling Act, for a supplemental U.S. stockpile of such materials, as the President determined from time to time, under contracts extending over periods up to 10 years. The act provided that— All strategic and critical materials acquired under authority of this title shall be placed in the above-named supplemental stockpile, and may be additional to the amounts acquired under authority of the Strategic and Critical Materials Stock Piling Act. Materials so acquired shall be released from the supplemental stockpile only under the provisions of section 3 of the Strategic and Critical Materials Stock Piling Act. Public Law 480 also authorized the Commodity Credit Corporation to barter or exchange agricultural commodities for strategic or other materials authorized by law, on such terms and under such regulations as the Secretary of Agriculture deemed to be in the public interest. Section 303 of the act set forth some of the reasons for bartering agricultural commodities, including the opportunity to protect the funds and assets of the CCC, less risk of loss through deterioration, and substantially less cost for storage charges. The Agricultural Act of 1956 (Public Law 540, 84th Cong.) contained the following pertinent language: SEC. 206. (a) Strategic and other materials acquired by the Commodity Credit Corporation as a result of barter or exchange of agricultural commodities or products, unless acquired for the national stockpile established pursuant to the Strategic and Critical Materials Stock Piling Act (50 U.S.C. 98-98h), or for other purposes, shall be transferred to the supplemental stockpile established by section 104 (b) of the Agricultural Trade Development and Assistance Act of 1954 (7 U.S.C. 1704). Section 7 of the conference report dated August 22, 1958, on the extension and amendment of Public Law 480, to accompany S. 3420, states that "no strategic or critical material shall be acquired by the Commodity Credit Corporation as a result of such barter or exchange except for such national stockpile, for such supplemental stockpile, for foreign economic or military aid or assistance programs, or for offshore construction programs." This conference report states that the Secretary of Agriculture was relieved of the responsibility of making a finding that barter transactions would protect the funds and assets of the Commodity Credit Corporation. Instead, the Congress made the policy decision that barter is in the best interest of the country. The reasons for acquiring materials through barter are indicated in the following language in the conference report: The language of the conference report (sec. 6 of the report) amends section 393 of the Public Law 480 and reiterates the policy of Congress that it is to the benefit of the United States to exchange surplus agricultural commodities which deteriorate in value and are costly to store for strategic and other materials of a type which will be needed by the United States, either in time of emergency or in its normal economy as world supplies of these materials decrease. There are at least four other provisions of law in which a similar congressional policy is enunciated. In reenacting section 303, the committee has broadened the base from which the President may select in designating those materials which are to be imported in exchange for surplus agricultural commodities. Most of the ore, metals, minerals, or other materials that might be taken will not deteriorate, can be stored at substantially less cost than agricultural commodities, and by their presence within the United States will improve its national resources. Materials acquired for the supplemental stockpile cannot be released for use without congressional approval. This provision is set forth in section 104(b) of the Agricultural Trade Development and Assistance Act of 1954, which states that materials shall be released from the supplemental stockpile only under the provisions of section 3 of the Strategic and Critical Materials Stock Piling Act. Section 3 of the Stock Piling Act provides that no material constituting a part of the stockpile may be disposed of without the express approval of Congress except by reason of obsolescence of that material for use in time of war. Under section 5 of the Strategic and Critical Materials Stock Piling Act the President is authorized to release stockpile materials for use, sale, or other disposition when in his judgment such release is required for purposes of the common defense either in time of war or during a national emergency. The Agricultural Trade Development and Assistance Act makes no reference to section 5 but specifically states that materials shall be released only in accordance with section 3 of the Strategic and Critical Materials Stock Piling Act. UPGRADING OF STRATEGIC AND CRITICAL MATERIALS Four upgrading contracts having a cost of $4,868,959 in surplus materials from the national stockpile and the Defense Production Act inventory were active as of June 30, 1967. Payment is being made with $1,680,284 in tin from the national stockpile, $2,094,050 in crude gum opium from the national stockpile, and $1,094,625 in ferronickel from the DPA inventory. Most other contracts completed under the upgrading program begun in January 1957 were paid for with materials from the DPA inventory or with cash under congressional appropriations. Contracts active on June 30, 1967, follow: 1. Upgrading of tungsten concentrates to 250,000 pounds of tungsten contained in hydrogen-reduced tungsten powder. Payment is being made in tin from the national stockpile with an equivalent value of $197,005. 2. Upgrading of molybdenite concentrates to 3,475,000 pounds of molybdenum contained in grade B ferromolybdenum. Payment is being made with ferronickel from the DPA inventory with an equivalent value of $1,094,625. 3. Upgrading of opium anhydrous morphine alkaloid to 455,226 pounds of morphine sulphate. Payment is being made in crude gum opium from the national stockpile with an equivalent value of $2,094,050. 4. Upgrading of columbian-tantalum bearing material to columbium oxide powder, columbium metal powder, and five grades of tantalum metal powder. Payment is being made with tin from the national stockpile having an equivalent value of $1,483,279. A fifth contract, executed and completed during fiscal year 1967 for the upgrading of copper cathodes to 5,993,996 pounds of oxygen-free, high-conductivity copper, was paid for in tin from the national stockpile with an equivalent value of $434,597. Two contracts executed in 1965 were completed during fiscal year 1967. Under one contract, cathode copper was upgraded to 8,000 short tons of oxygen-free, high-conductivity copper and payment was made in electrolytic nickel cathode from the DPA inventory with an equivalent value of $1,160,000. Under the other contract, columbium concentrates were upgraded to 360,000 pounds of columbium contained in ferrocolumbium and payment was made in tungsten from the DPA inventory with an equivalent value of $246,600. Payment of costs for the 25 upgrading contracts completed during the 1012-year program included $9,623,327 in cash, $7,032,276 in DPÅ materials, and $760,284 in tin from the national stockpile for a total of $17,415,887. With the cost of the four active contracts added, the sum for the entire upgrading program is $22,284,846. The following table summarizes both upgrading and beneficiation of stockpile materials through June 30, 1967: |