futures markets operating under the Commodity Exchange Act, and lend more factual meaning to the data on open contracts which the CEA has issued for many years.

Commodities and markets covered by the new reports include wheat on the Chicago Board of Trade, Kansas City Board of Trade, and Minneapolis Grain Exchange; corn, oats, rye, soybeans, soybean oil, and soybean meal on the Chicago Board of Trade; eggs (shell and frozen) on the Chicago Mercantile Exchange; cotton on the New York Cotton Exchange; wool on the Wool Associates of the New York Cotton Exchange; cottonseed oil on the New York Produce Exchange; and potatoes on the New York Mercantile Exchange.

13. Contract markets and regulated commodities.-The 17 commodity exchanges licensed as contract markets under the Commodity Exchange Act and the 18 commodities in which futures trading was conducted under the act in fiscal 1962 are as follows:

Chicago Board of Trade: Wheat, corn, oats, rye, soybeans, cotton, soybean oil, lard, soybean meal.

Chicago Mercantile Exchange: Eggs (frozen and shell), potatoes.

Chicago Open Board of Trade: Wheat, corn, oats, rye, soybeans.

Duluth Board of Trade: (no trading in 1961-62).

Kansas City Board of Trade: Wheat, corn, grain sorghums.

Memphis Board of Trade Clearing Association: Cottonseed meal, soybean meal. Merchants' Exchange of St. Louis: Millfeeds.

Milwaukee Grain Exchange: Wheat, corn, oats, rye.

Minneapolis Grain Exchange: Wheat, oats, rye, flaxseed.

New Orleans Cotton Exchange: Cotton.

New York Cotton Exchange: Cotton.

New York Mercantile Exchange: Potatoes.

New York Produce Exchange: Cottonseed oil, soybean oil.

Portland Grain Exchange: (no trading in 1961-62).

San Francisco Grain Exchange: (no trading in 1961-62).

Seattle Grain Exchange: (no trading in 1961-62).

Wool Associates of the New York Cotton Exchange: Wool, wool tops.

Workload data on major activities of the Commodity Exchange Authority

1964 BUDGET ESTIMATE

Mr. CALDWELL. The budget estimate for enforcement of the Commodity Exchange Act in the fiscal year 1964 is $1,095,000, which will provide for continuation of the 1963 level of operations and add funds only for pay costs. The net increase of $32,000 includes $37,000 for increased pay costs in 1964 and a decrease of $5,000 representing estimated savings due to centralized data processing of payroll and personnel data.

Absorption of the pay act costs would not be possible without a reduction in personnel. In view of the increased use of the futures markets, involving a heavier regulatory workload, a reduction in personnel would seriously jeopardize the effectiveness of our enforcement program.

My associates and I will be glad to answer any questions you may have on the work of the Commodity Exchange Authority.

RELATIONSHIP OF COMMODITY PROGRAMS TO FUTURES MARKET

Mr. WHITTEN. I think you have made a very thorough presentation of your work. Most of us are familiar with your operations in times past.

One thing noticeable to me is that, despite the feelings on the part of some that the Government programs of purchase and price supports jeopardize the futures markets and hedging possibilities, I note from your statement that that does not appear to be true, if judged by the total volume of trading which has been going on. I presume, however, that with price supports and governmental programs the wide variations that formerly prevailed prior to the act perhaps do not occur as much now. The ups and downs are not as wide apart as before. Is that generally true?

Mr. CALDWELL. It depends on the individual program for the commodity and conditions in the market. For example, the program in cotton has, to a large extent, restricted futures trading because there has been no price movement in cotton. But in other commodities such as soybeans, wheat, and corn, there has been substantial price movement. Wherever there is price movement there is a need for a futures market.

VOLUME OF TRADING IN COTTON

Mr. WHITTEN. Some years ago, I talked to an international cotton trader, whose headquarters are primarily in Belgium. He made the statement that at the Liverpool market, one of the larger cotton markets, in periods the total volume of trading was so small as to be somewhat risky to deal with it. He wasn't reflecting on that market alone but said the same thing applied to other cotton futures markets. The total volume of trading has continued small, has it not? Mr. CALDWELL. In the cotton markets; yes, it has.

Mr. WHITTEN. Would you have available, without too much trouble, the volume for the last few years for the New Orleans and New York and Liverpool markets? That can be supplied for the record if you don't have it readily available.

Mr. CALDWELL. I have information on that available here.

futures markets operating under the Commodity Exchange Act, and lend more factual meaning to the data on open contracts which the CEA has issued for many years.

Commodities and markets covered by the new reports include wheat on the Chicago Board of Trade, Kansas City Board of Trade, and Minneapolis Grain Exchange; corn, oats, rye, soybeans, soybean oil, and soybean meal on the Chicago Board of Trade; eggs (shell and frozen) on the Chicago Mercantile Exchange; cotton on the New York Cotton Exchange; wool on the Wool Associates of the New York Cotton Exchange; cottonseed oil on the New York Produce Exchange; and potatoes on the New York Mercantile Exchange.

13. Contract markets and regulated commodities.-The 17 commodity exchanges licensed as contract markets under the Commodity Exchange Act and the 18 commodities in which futures trading was conducted under the act in fiscal 1962 are as follows:

Chicago Board of Trade: Wheat, corn, oats, rye, soybeans, cotton, soybean oil, lard, soybean meal.

Chicago Mercantile Exchange: Eggs (frozen and shell), potatoes.
Chicago Open Board of Trade: Wheat, corn, oats, rye, soybeans.

Duluth Board of Trade: (no trading in 1961-62).

Kansas City Board of Trade: Wheat, corn, grain sorghums.

Memphis Board of Trade Clearing Association: Cottonseed meal, soybean meal. Merchants' Exchange of St. Louis: Millfeeds.

Milwaukee Grain Exchange: Wheat, corn, oats, rye.

Minneapolis Grain Exchange: Wheat, oats, rye, flaxseed.

New Orleans Cotton Exchange: Cotton.

New York Cotton Exchange: Cotton.

New York Mercantile Exchange: Potatoes.

New York Produce Exchange: Cottonseed oil, soybean oil.

Portland Grain Exchange: (no trading in 1961-62).

San Francisco Grain Exchange: (no trading in 1961–62).

Seattle Grain Exchange: (no trading in 1961-62).

Wool Associates of the New York Cotton Exchange: Wool, wool tops.

Workload data on major activities of the Commodity Exchange Authority

1964 BUDGET ESTIMATE

Mr. CALDWELL. The budget estimate for enforcement of the Commodity Exchange Act in the fiscal year 1964 is $1,095,000, which will provide for continuation of the 1963 level of operations and add funds only for pay costs. The net increase of $32,000 includes $37,000 for increased pay costs in 1964 and a decrease of $5,000 representing estimated savings due to centralized data processing of payroll and personnel data.

Absorption of the pay act costs would not be possible without a reduction in personnel. In view of the increased use of the futures markets, involving a heavier regulatory workload, a reduction in personnel would seriously jeopardize the effectiveness of our enforcement program.

My associates and I will be glad to answer any questions you may have on the work of the Commodity Exchange Authority.

RELATIONSHIP OF COMMODITY PROGRAMS TO FUTURES MARKET

Mr. WHITTEN. I think you have made a very thorough presentation of your work. Most of us are familiar with your operations in times past.

One thing noticeable to me is that, despite the feelings on the part of some that the Government programs of purchase and price supports jeopardize the futures markets and hedging possibilities, I note from your statement that that does not appear to be true, if judged by the total volume of trading which has been going on. I presume, however, that with price supports and governmental programs the wide variations that formerly prevailed prior to the act perhaps do not occur as much now. The ups and downs are not as wide apart as before. Is that generally true?

Mr. CALDWELL. It depends on the individual program for the commodity and conditions in the market. For example, the program in cotton has, to a large extent, restricted futures trading because there has been no price movement in cotton. But in other commodities such as soybeans, wheat, and corn, there has been substantial price movement. Wherever there is price movement there is a need for a futures market.

VOLUME OF TRADING IN COTTON

Mr. WHITTEN. Some years ago, I talked to an international cotton trader, whose headquarters are primarily in Belgium. He made the statement that at the Liverpool market, one of the larger cotton markets, in periods the total volume of trading was so small as to be somewhat risky to deal with it. He wasn't reflecting on that market alone but said the same thing applied to other cotton futures markets. The total volume of trading has continued small, has it not? Mr. CALDWELL. In the cotton markets; yes, it has.

Mr. WHITTEN. Would you have available, without too much trouble, the volume for the last few years for the New Orleans and New York and Liverpool markets? That can be supplied for the record if you don't have it readily available.

Mr. CALDWELL. I have information on that available here.

The way I have this information broken down as far as cotton is concerned is adding the volume of trading in the New Orleans and the New York exchanges. Actually, the New Orleans volume of trading has been very, very limited in recent years. The total volume of trading in cotton for fiscal 1962-this is the annual volume of trading-was 3,493,000 bales.

That will compare, for example, with the volume of trading in fiscal year 1953 of 91,335,000 bales.

Mr. WHITTEN. In 1953, that would run roughly four or five times the size of the crop. The volume has gone down now to where it would be only 25 percent of the crop?

Mr. CALDWELL. Yes, sir.

Mr. WHITTEN. This has been one of the problems that has faced the cotton industry in trying to resolve its various differences between the producer on the one hand, the exporter, shipper and the rest. I am glad to have that information.

RULES OF CONDUCT FOR CCC BOARD

There is one thing that perhaps is unfair to ask you, until I have a chance to ask the Secretary. Some years ago, under a different administration, I raised the question here as to whether there should not be some rules by which the Commodity Credit Corporation Board was governed; that is, some rules of conduct, to say the least.

At that time I pointed out it was no reflection at all on the then members of the Board, and I meant every word of it. But when we realize how well regulated and protected crop estimates are, where they have them send them in separately and lock the people up, and pull the blinds so they can't wiggle the curtain, as once happened, just because the estimate might influence the markets-yet, so far as I know there is absolutely no rule that applies as to how you will handle the Commodity Credit Corporation where actual sales are involved, which doubtless would influence the markets even more so than an estimate.

I say candidly, in the years that I have served on this committee I have never heard the slightest rumor or report or indication that anybody in the Department or on the Commodity Credit Corporation Board has done anything other than act completely and fully honorably. However, it does strike me that this is an area in which some attention perhaps ought to be given just for the protection of those that have to hold those places, because of the importance of a decision to sell, for example, 500 million bushels of corn and the effect it will have.

That decision, that action on the market, becomes a bigger influence on affecting the market than any crop estimate. I hope that we will have a chance to talk to the Secretary, Mr. Grant, and about this subject prior to closing our hearings.

Mr. GRANT. We will be glad to talk to the committee about it, Mr. Chairman.

Actually everyone who attends a Board meeting or participates in these discussions is under strict instructions to keep the matters discussed or decisions made confidential.

Mr. WHITTEN. I preface my remarks by saying that I have never heard the slightest criticism or indication or anything of the sort.