of something over $700,000, and I know that our members in that area are extremely well satisfied with that situation. There is also a Production Credit Loan Association of Salisbury, Md., and they have been making loans, not on so extensive a scale; but I understand they have been extremely helpful. And I believe the president of the New England Oyster Growers’ Exchange has written you a letter which explains the situation with respect to the cooperative. The CHAIRMAN. Yes; there is a brief letter here; but what I would like to have is a statement that would cover the field very generally and show just what benefits have accrued from that legislation. Dr. RADCLIFFE. I will endeavor to get that for you. THE OYSTER INSTITUTE OF NORTH AMERICA, Washington, D. C., July 12, 1937. Hon. S. O. BLAND, Chairman, Merchant Marine and Fisheries Committee, House of Representatives, Washington, D. C. MY DEAR CONGRESSMAN : Referring to your request at the hearings on H. R. 7309 for further information on the success of the Farm Credit Administration in meeting by loans the needs of the oyster planters, Mr. S. M. Garwood, production credit commissioner, writes me that: “The associations which extend credit to oyster planters, likewise finance the members engaged in other types of operations and, accordingly, their periodical reports on loans do not disclose facts relating to any particular type of loan. “It is our understanding that the associations have found it possible to finance the operations of quite a number of the leading oyster planters in a manner which has been quite helpful to them.” At our convention in New York on June 1, the secretary of the Providence, R. I., Production Credit Association showed loans to oyster planters as follows: 1935. $151, 650 1936: New loans- 309, 025 Renewals. 42, 650 Grand total of new and renewals for the 3 years. --- 721, 316. 21 In my discussions of the situation with members of the industry all the comments have been favorable to the helpfulness of the aid given by the Farm Credit Administration. Very truly yours, LEWIS RADCLIFFE, Director. (The hearing was thereupon adjourned subject to the call of the chairman.) FISHERY CREDIT ACT FRIDAY, JULY 16, 1937 HOUSE OF REPRESENTATIVES, Washington, D. C. The committee met at 10 a. m., Hon. Schuyler 0. Bland (chairman) presiding. Present: Members of the committee; also Mr. Reginald H. Fiedler, Chief of the Division of Fishery Industries, and Mr. L. C. Salter, fishery economist, United States Bureau of Fisheries. STATEMENT OF L. C. SALTER, FISHERY ECONOMIST, UNITED STATES BUREAU OF FISHERIES The CHAIRMAN. Dr. Salter, what experience have you had with cooperative associations and organizations? Mr. SALTER. Why, Mr. Chairman, I have been engaged in cooperative-marketing work in agriculture and fisheries for about 12 years. The CHAIRMAN. You may proceed. Mr. SALTER. Up to the present time the Department has not obtained clearance from the Bureau of the Budget on our report on this bill. Therefore, I cannot express the views of the Department of Commerce, or the Bureau of Fisheries, on this measure. Such views as I may express on this bill are, therefore, my own personal views. The CHAIRMAN. I will be very glad to have you present them. Mr. SALTER. As a basis for this discussion, I should like to preface my remarks concerning H. R. 7309 by stating that for 12 years I have been engaged as an economist in the marketing of agricultural or fishery products, with particular attention directed to the cooperative method of marketing these commodities. I joined the staff of the United States Bureau of Fisheries in October 1935, to have charge of its cooperative work. In this capacity I have engaged in studies and research relating to the various phases of fishery cooperative marketing, including: (1) State laws under which fishermen may organize and operate cooperative associations; (2) the functions and activities of State departments and institutions relating to fishery cooperative marketing; (3) analyses of fishermen's associations with respect to their organic structure, cooperative status, and operating methods and policies; (4) the financing of fishermen and the effect thereof on the freedom of fishermen to market their fish to the best advantage. Considerable work has been done in preparing and supplying information, advice, and counsel to fishermen and existing associations relative to organizing and operating fishery cooperative associations. In this connection, a pamphlet, Fishery Circular No. 22, was published and has been favorably received by interested parties in the commercial fishery-producing States. It was thought advisable to learn something of the nature and extent of fishery cooperation in foreign countries, and a study of this character is in progress. Although these data have not been analyzed sufficiently to make a report at this time, indications are that cooperative marketing of fishery products is rather prevalent and of long standing in a number of the countries. Most of the countries studied provide aid to fishermen's associations in the form of loans, grants-in-aid, and institutional services of an educational character. The CHAIRMAN. Did I understand you to state there is a study that is being made or a paper that is being prepared dealing with that subject ? Mr. SALTER. Yes, sir. I might clarify that, Mr. Chairman, by stating that, in cooperation with the Bureau of Foreign and Domestic Commerce, who are securing the basic data for us, we are making a study of fishery cooperative associations in foreign countries; but, as I have stated, the analysis of the material has not progressed to the point where we can make a formal report on it. The CHAIRMAN. I see. Mr. SALTER. Studies pertaining to existing associations in this country and the financing of fishing enterprises were conducted by the speaker in person on the Pacific, the Atlantic, and Gulf coasts. It is expected the studies shall be continued to embrace the Great Lakes region. Now as to the bill under consideration: H. R. 7309 proposes, first, that the Government establish and provide funds for an agency to make loans to cooperative associations of fishermen; and, second, that a section be created in the Bureau of Fisheries to conduct research and educational work to encourage the organization of producers of aquatic products into effective associations whose purposes are the cooperative marketing of their products and the cooperative purchasing of fishery supplies and equipment. In discussing the provisions of this bill and in determining whether the Government should engage in the functions set forth in this measure, it is deemed advisable to give consideration to (1) the fishermen's need for this or similar legislation as indicated by the prevailing conditions in the fisheries; (2) similar legislation that has been passed by Congress for the benefit of farmers and like functions that are performed by the Government for farmers' cooperatives; (3) the adequacy of the bill, and whether its provisions may be administered so as to further the policy set forth in the bill. I. Taking up the first, fishermen's needs for this type of legislation as evidenced by some of the prevailing conditions: For the purposes of this discussion, commercial fishermen are grouped in two classes; (1) “independent”, and (2) “dependent.” By independent fishermen is meant those who operate their own boats, nets, and other gear. By dependent fishermen is meant those who do not own boats or equipment but who operate craft and gear belonging to wholesale dealers, canners, or other persons. Dependent fishermen are found in practically every type of fishery. Fishermen of the dependent class, for the most part, are not in a position to engage in cooperative-marketing ventures and are of minor significance in this discussion. On the other hand, independent fishermen, and others who might engage in the collective production of fish where all property and materials would be owned jointly, are the ones who probably will be the principal recipients of the benefits of the proposed legislation. Let us consider the smaller type of these independents. In miscellaneous small craft they fish the rivers, bays, sounds, and close-in sea waters. Their boats include skiffs and small power boats of a few hundred dollars value, and larger power boats representing an investment of from $1,500 to $3,000. Some of the larger and better equipped cost as much as $5,000. Investment in nets and gear varies with the type of fishing and the number of fishing seasons per year. This ranges from $50 to $100 for the smaller type craft and from $1,000 to $1,500 for the larger boats. Replacement of nets and gear varies from 30 percent to 300 percent annually. This type of independent fisherman usually lives in a village or a small town along bay shores and inlets within a day's running distance from the fishing grounds. His crew of one, two, or three fishermen are usually his relatives or neighbors. He is engaged principally in the catching of miscellaneous food fish. On the average, his individual production is not large; however, the total production by all such fishermen comprises a large proportion of the miscellaneous food fish produced for the fresh market. In addition to the inshore fishermen, there are among the independents those fishermen who work in the ocean in sea-going vessels of large and intermediate sizes. The smaller or coastwise vessels range in size from 5 to 40 net tons, and represent an investment of from $3,500 to $25,000; the larger or high-seas type range as high as 250 and 290 net tons, with an average size of about 150 net tons. Some of the larger vessels were reported to have cost as high as $120,000 to $170,000. A conservative estimate of the investment in the average of the larger vessel type is about $80,000. Investment in gear for vessels is governed by the type of fishing pursued. The larger vessels do not necessarily have the most expensive gear. Certain types of gear outfits such as hand-lining, long-lining, and trolling require from a few hundred to a few thousand dollars, and the replacement costs are not great compared with producing capacity. On the other hand, gear for trawlers, draggers, seiners, and for oyster planting and producing require investments ranging from $5,000 to $15,000. Replacement costs of such gear vary with the type of fishing, risks involved, and care taken of the equipment. Nets and draggers, or parts of them, may be destroyed within a few minutes after putting them overboard. Normal replacement is usually around 30 percent annually for certain types of gear, while other types are replaceable in from two to five seasons. Among the independent fishermen there are producers of edible fish for the fresh market and producers of fish for canning or processing. Fish for canning or processing are generally caught by the large type vessels; however, some types of salmon, herring, and oyster fishing are exceptions. On the other hand, a goodly portion of the larger vessels are engaged in catching fish for the fresh mar |