Department of Agriculture Appropriations for 1964

Conversion of program volume to work units, labor and fund requirements-Continued

Work item No.

Mr. BEACH. That is on various commodities-wheat, cotton, corn, and others. The net was higher in 1963 than 1962 and will be lower in 1964.

Mr. GODFREY. Might I clarify it?

This is an administrative expense item. The fact that we are selling last year we sold 900-and-some-odd million bushels of cornentails the issuing of loading orders to those country elevators; 950 million bushels of corn might involve 200 million warehouse receipts, and the shipment of so many cars of corn. A lot of paperwork.

So the administrative expense did go up a little when we were selling this, over what we had anticipated.

Mr. ADDABBO. When you say "administrative expense," is this the actual shipping expense, or man-hours?

Mr. GODFREY. Man-hours.

Mr. ADDABBO. $5 million difference.

Mr. GODFREY. Approximately $5 million.

There is another involvement here. There are several other things involved. Another was additional loans made over and above what we had anticipated.

Mr. BEACH. We are doing $3 to $4 million in loans, and a millionfor example, 1,155,000 bills of lading to be handled, 1,618,000 warehouse receipts on grain, 6,700,000 warehouse receipts on cotton. This is a tremendous mass of paper that has to be moved.

DONATIONS

Mr. ADDABBO. In volume 3, page 213, what is meant by donations? What are donations?

Mr. BEACH. What it means is simply we give the commodity to a recipient eligible to receive it under the law. Section 416 of the law under which CCC operates, and also Public Law 480 spell out rather specifically the criteria that must be used in establishing who is eligible to receive the donated commodities.

Mr. ADDABBO. We are donating out; not getting?

Mr. BEACH. They are on an order of priority. They are actually given away. There is no return to the Corporation for them.

Mr. ADDABBO. I saw a plus sign, so I thought for a change somebody was donating to us.

Mr. BEACH. No, sir.

Mr. HORAN. That will be the day.

Mr. BEACH. Probably we are donating more.

Mr. ADDABBO. In the chart showing cropland conversion program, in 13 States and 41 counties, about 9 projects are going into Pennsylvania, but none in New York.

Is there any particular reason for this?

Mr. GODFREY. It was just the selection of the States. The other counties were the counties that had submitted projects. Pennsylvania has been very active in submitting projects. I don't know whether New York has submitted any or not. It is still open for them to submit projects.

Mr. ADDABBO. In other words, the State has to institute the request? Mr. GODFREY. That's right, sir.

INVESTMENT IN PRICE SUPPORT

Mr. HORAN. I have before me a statement from the CCC official reports: "Total investments in loans and inventories, January 31, 1961, $8,108,132,000; January 31, 1963, $8,465,384,000, or, from these figures, an increase of $357,252,000. Could you comment?

Mr. GODFREY. Yes. The primary cause for the higher figure, January 31, 1963, results from an early and large volume of corporate loans, many of which have now been redeemed, and the fact that we do not have as heavy sales under the feed grain program during the late fall months as we had last year. And, a second thing, the extraordinary large volume of cotton which was placed under loan primarily because of discussion of a possible reduced price for the domestic users of cotton.

Then the third item which built up an inventory was the increased inventories of dairy products on hand, and then a fourth minor item was increased loans on some other commodities.

We expect fully that cotton loan repayments will be substantial between now and the end of June 30. We also expect that the feed grain sales will continue at a regular rate, which will save our total obligation to the feed grain pool, to pay off all the payments that we made last year.

We expect this to reduce our total investment by June 30 of this year to $7 billion. Then by June 30, 1964, we would expect to be down to $6 billion, total investment.

Mr. HORAN. That is an expectation.

Mr. GODFREY. Yes, this is an expectation, but I would point out that there is a realization at the same time due to the feed grain program and wheat stabilization program. The actual CCC investment in feed grain and wheat inventories is $1,001 million less for the two periods that give you (January 31, 1961, compared with January 31, 1963). There is an investment in loans and inventory of $652 million less on corn, $17 million more on grain sorghums, $41 million less on barley, and $325 million less on wheat.

Mr. HORAN. In terms of the question I asked, what does that mean? Mr. GODFREY. This means that the investment is temporarily high; that it will come down as a result of sales of cotton or redemption of loans on cotton and sales of feed grain under the feed grain program. Mr. HORAN. You base that expectation on what?

Mr. GODFREY. I base the expectation on sales of feed grain because we are currently selling them, each week, each day.

Mr. HORAN. And on cotton?

Mr. GODFREY. On cotton because the pipelines are practically empty at the present time. The chart I showed you the other day shows that the commercial stocks were practically nil. If they expect to continue to operate the textile mills, they are going to have to have

cotton.

Mr. HORAN. The same thing applied to lumber a couple of years ago, but we still have stockpiles made up, now, of imported Canadian timber.

Mr. GODFREY. We actually sold nearly 100 million bushels of corn in the month of February, since the January 31 figure. We sold some since the 1st of March of course. We are selling on an average