I would think that that was the general feeling of this committee, Senator Allott. Senator ALLOTT. Well, that isn't my impression. They were for it provided these prices could be jacked up to some amount greatly beyond that, and completely out of the realm of practicability. But my impression is that as far as trying to work out a compromise of the Secretary's proposal last year that there was very little-that he got very little support up here or from the industry. Senator BIBLE. I think the record of the Senate Finance Committee will speak for itself on that point. Mr. Palmer, did you have any further observations? Mr. PALMER. No. Senator BIBLE. Senator Dworshak, did you have any further questions? Senator DwORSHAK. No. Thank you. Mr. REDWINE. I would like permission to insert various statements and letters at the close of our hearings several days hence. Senator BIBLE. Without objection, the record will carry the statements referred to by the staff member. We stand in recess until 10 o'clock Monday morning. (Whereupon, at 4:30 p. m., the committee recessed to reconvene at 10 a. m., Monday, June 16, 1958.) LONG-RANGE PROGRAM FOR MINERALS INDUSTRY MONDAY, JUNE 16, 1958 UNITED STATES SENATE, SUBCOMMITTEE ON MINERALS, MATERIALS AND FUELS, OF THE COMMITTEE ON INTERIOR AND INSULAR AFFAIRS, Washington, D. C. The subcommittee met, pursuant to recess, at 10 a. m., in room 224, Senate Office Building, Hon. James E. Murray (chairman of the committee) presiding. Present: Senators Murray (chairman), Malone, and Watkins. Also present: Robert Redwine, staff member and George Holderer, staff engineer. The CHAIRMAN. The subcommittee will come to order, please. This is a continuation of the hearings on the proposed minerals stabilization plan, which was begun a few days ago. Senator Morse, our esteemed colleague from the State of Oregon, is our first witness. STATEMENT OF HON. WAYNE MORSE, UNITED STATES SENATOR FROM THE STATE OF OREGON Senator MORSE. Mr. Chairman and members of the subcommittee, as a Senator from the State of Oregon I have always taken a deep interest in the mining industry of my home State as well as that of the entire Nation. It is with a great deal of apprehension, therefore, that I have observed recent adverse developments affecting the mining industry, and particularly those relating to the production of chromite ore in the States of Oregon, Washington, and California. The chromite miners of Oregon have been hurt seriously as a consequence of last month's closure of the minerals stockpiling program. The hardships caused by the closure have spread to many segments of Oregon's economy that are related, directly or indirectly, to chrome mining. PROPOSED EXTENSION OF MINERALS STOCKPILING PROGRAM On May 7, 1958, I offered an amendment to the Murray-Mansfield minerals purchasing bill, S. 3600. The amendment has as its purpose the extension of the chromite ore purchasing program and the restoration of the price paid over the past few years to our domestic chrome miners. I was pleased to have as cosponsor of this amendment, Senators Neuberger, Murray, and Mansfield. I followed this course of action because so far as the chrome mining industry is concerned, an economic emergency is upon us. As heretofore mentioned, the stockpiling program has terminated. The chrome miners are shutting down their operations. Employees are being laid off. The mines are being maintained at the out-of-thepocket expense of the owners or are beginning to deteriorate as a consequence of nonuse. This is a sad commentary upon the lack of foresight of the Government concerning a product which would be essential to the safety of the Nation in the event of a defense emergency. May I digress for just a moment to state that in my opinion the chairman of the Senate Interior Committee, the members of this subcommittee, and many other Senators who are interested in the future of the Nation's mining industry are to be complimented for their efforts to do something about the situation now confronting the chrome miners and those producing other essential minerals. I refer particularly to their endeavors, as illustrated by the resolution of May 14, 1958-Senate Resolution 304-calling for conversion of chromite and manganese ores to ferrochrome and ferromanganese; to the bill S. 3600 of April 3, 1958, to continue the stockpiling program, and to S. 3816 of May 15, 1958, to provide incentive payments on certain essential metals, including metallurgical chromite. THE DEFENSE IMPORTANCE OF THE MINING INDUSTRY I would be the first to concede that I am not an expert on the subject of mining, but my years of work as a former member of the Senate Armed Services Committee and my present membership on the Senate Foreign Relations Committee give me an awareness of the defense needs of our country. Commonsense dictates that we should have a ready source of strategic metals together with an ample supply of stockpiled or upgraded ore, and when I refer to the stockpiled ore, Mr. Chairman, I have in mind the ore in the hills as well as that already mined. Never again should we be compelled to face a situation in which we are entirely dependent on the whims of foreign sellers and on the dangers of attack from submarines and other hostile forces on the ocean freight lines. If a state of war emergency should occur-I hope fervently it will not-it is probable that the present shortsighted metals program of this administration would bring us face to face with the crucial problem of trying to get vital supplies of chrome ore from foreign sources. All I can say is that we should learn through our past difficult experiences. THE STOCKPILE IN THE HILLS It is of paramount interest to our entire Nation that our chrome mines be maintained in productive status, because if the mines are operative and in standby condition, they will be available for immediate expansion to maximum output when needed. In other words, the Nation can truly count as part of its "stockpile in the hills" the potential output of properly maintained mines. Closely related to the defense importance of maintaining our mines as going concerns are the benefits to be derived by way of development of techniques in handling, processing, and utilizing the products of our active chrome mines as well as the benefits of all-important developmental and discovery work that attends the operation of a successful mine. Then too, we should not overlook the economic importance of business and industry, such as those in the fields of heavy machinery, trucking, and retail sales that bear a close relationship to the mining industry. THE ADMINISTRATION'S MEANINGLESS MINERALS PROGRAM BILL OF 1957 In 1957 the administration came forth with its so-called comprehensive minerals program which was utterly worthless to the bulk of the chrome mining industry. This bill S. 2375 of the 85th Congress, called for an incentive of $21 per ton for the domestic chromite program. On July 29, 1957, when I testified on the bill, I said that the incentive of $21 a ton would not accomplish the objectives of the bill-the stimulation for mineral exploration and the assurance of continued production of certain essential minerals within the United States. During the course of my testimony on S. 2375, I emphasized the fact that most of the chrome miners of Oregon fall into the so-called "small business" category and that they could not produce at a reasonable profit to meet foreign prices with a mere $21 per ton subsidy. Therefore, I expressed the hope that the $21 figure would be increased to the point where these small business operations could be carried on with a reasonable profit incentive. S. 3818-A STEP IN THE RIGHT DIRECTION In introducing S. 3816, Senator Murray took an action that offers considerable hope for our Oregon chrome miners. I believe that with appropriate amendments this legislative proposal can bring greatly needed assistance to this segment of the mining industry. Under section 3 (a) (2) provision is made for an incentive payment of $46 per long dry ton for commercial grade metallurgical chromite (46 percent basis) with the usual premiums and penalties. However, the difficulty confronting the Oregon chrome miners under S. 3816 is the provision contained in section 3 (c) of the bill which reads: No incentive payment shall be made pursuant to the provisions of this act except upon presentation of evidence satisfactory to the Secretary that the material has been produced and sold in accordance with regulations issued under section 4 of this act. Oregon and California chrome miners with whom I have discussed S. 3816 in detail stated frankly that while the bill offers encouragement to the domestic chrome mining industry, in actual practice it would be almost impossible for the small Oregon chrome miners to effect sales, as required under section 3 (c), so as to qualify for the incentive payment provided under the bill. The domestic miner would have to find a buyer who would take his ore of a certain specified grade at the world market price, but the fact is that buyers of domestic chromite ore would not be interested in purchasing the various quantities and grades of ores that are produced-usually in small lots-in our Oregon chrome mines. To make 27255-58-pt. 2- -23 |