require them to give us these figures. We are not administrators of these supply contracts, and we asked for them so we will be up to date on the total picture in the industry.

Mr. ARNOLD. When Dr. Flemming wrote that it was his understanding that you would keep these figures and statistics and supply them to the committee, did he convey that understanding to you or did you have any discussions with Dr. Flemming-or what is the relationship between BDSA and Dr. Flemming?

Mr. EDMUND. I have no knowledge of any letter or any delegation of authority. Do you know, Mr. Snow?

Mr. SNOW. We have no delegation to that effect.

Mr. ARNOLD. So you never heard this at all from Dr. Flemming's office?

Mr. SNOW. To my knowledge, not at all.

Mr. EDMUND. I think there were estimates in prior hearings that BDSA was keeping figures on shipments to nonintegrated users, and we are, and these are the figures from which I developed this total tonnage.

Mr. ARNOLD. Did Dr. Flemming, during the third quarter, at any time ask for any report or any information from BDSA for the purpose of enabling him to reach a decision as to whether the expansion goal should be closed or kept open on aluminum?

Mr. EDMUND. I think that Dr. Flemming did not ask BDSA directly. I feel certain that he conferred with the Department of Commerce Secretary Weeks who is, I believe, a member of the DMB.

Mr. ARNOLD. And you say you feel certain that he conferred with Secretary Weeks. Did Secretary Weeks consult you or any other member of the Aluminum and Magnesium Division about preparing a report or a survey to aid him in making any recommendations to Dr. Flemming about closing out or keeping open the aluminum expansion goal?

Mr. EDMUND. Not since I have been in the agency on the expansion; no, sir.

Mr. ARNOLD. Have you talked to the Secretary of Commerce at all about conditions, present conditions, in the aluminum industry since you have been in the Division, Aluminum and Magnesium Division? Mr. EDMUND. I have not personally, no.

Mr. ARNOLD. Did Secretary Weeks, to your knowledge, make any recommendations to Dr. Flemming concerning the closing out or the keeping open of the aluminum expansion goal?

Mr. SNOW. We are not the delegated agency on primary aluminum. That is delegated to the Interior Department, so we would have no recommendation to make.

Mr. ARNOLD. Well, I am trying to determine for the record where the recommendations in fact came from, if they came from any source. Mr. YATES. Does not your agency calculate the amount of demand that will be anticipated for aluminum during the next year? Mr. EDMUND. Yes, we do.

Mr. YATES. Have you made that calculation for the next year? Mr. EDMUND. Well, this year, and based on the demand as it exists today, our demand for the next year, it looks like we will be limited to the supply; in other words, demand is going to equal supply.

Going beyond that, we are unable to predict how much more might be used if it was available. But

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Mr. YATES. Do you know what the potential demand will be?

Mr. EDMUND. Well, there are estimates made in the industry which indicate the growth will be anywhere from 5 percent up to 15 percent, a number of those estimates.

I think we have furnished the committee with a table.

Mr. YATES. A table showing what?

Mr. EDMUND. A table showing the supply for next year.

Mr. YATES. What does that table show as total source of supply? Mr. EDMUND. 4,702 million pounds.

Mr. SNOW. That is the last line.

Mr. YATES. From all sources?
Mr. EDMUND. Correct.

Mr. YATES. Who computed this for you? The reason I ask is that I have an estimate here from ASRI.

Mr. SNOW. Aluminum Smelters Research.

Mr. YATES. And they come out to exactly the same figures. Did they give you the figures or did you give them the figures?

Mr. SNOW. We probably gave them.

Mr. YATES. I see.

Mr. EDMUND. We distribute these figures to the industry when they are in the advisory meetings.

Mr. YATES. Did you make the computation for 1957, 1958, 1959, and 1960 that appears upon their projection?

Mr. EDMUND. No, sir.

Mr. YATES. Based upon 4,702 million pounds, how much less aluminum will there be than projected demand?

Mr. EDMUND. We do not know that, sir.

Mr. YATES. You do not have any ideas on the demand?

Mr. EDMUND. No, sir.

Mr. YATES. Would you be interested to know what their conclusions were?

Mr. EDMUND. Yes, I would be interested.

Mr. YATES. Based upon their projected supply and demand for 1956, there is an indicated overage, without reference to stockpile and without reference to exports, of 577 million pounds. Does that sound reasonable to you?

Mr. EDMUND. That is more demand than there is supply?

Mr. YATES. No; more supply than there is demand, an overage of supply. Does that make sense, apart from stockpile and apart from any export?

Mr. EDMUND. If I understand correctly, they are stating that next year there will be

Mr. YATES. Let me show you their figures, and then let me know what conclusion you come to. That is based, too, on full expansion of everybody who has an expansion pending.

Mr. ARNOLD. Yes, it would also apply to Reynolds, Kaiser, Revere, and those

Mr. YATES. They will not bring anything in in 1956 though, they cannot supply it. Revere will not have production faciilties available; neither will Harvey and neither will Ölin.

Mr. EDMUND. Well, they are projecting for next year a total con:sumption approximately the same as we expect this year. Mr. YATES. Yes.

Mr. EDMUND. Now, the only thing I want to say in that regard is that most people analyzing the market feel there will be a growth somewhere between 5 and 15 percent in demand per year.

Now, the estimates are mostly from reliable sources, but they vary from 5 to 15 percent.

Mr. YATES. Let me ask you your opinion, supposing Dr. Flemming makes no stockpile call next year; will there be a sufficient supply of aluminum to take care of the potential demand?

Mr. EDMUND. In my opinion it will be. It depends, of course, on the total economic situation, assuming that our gross national product continues at the rate of growth that it has been continuing this year, and then I think we would be approximately in balance without any stockpile call.

Mr. YATES. Did you feel last year that this would happen, too?
Mr. EDMUND. No, sir.

Mr. YATES. You thought there would be shortages this year? Mr. EDMUND. We thought there would be a substantial overage in supply this year.

Mr. YATES. Did you?

Mr. EDMUND. Last year; that is the way I felt, with the majority. Mr. YATES. I see.

How much weight should we give to your opinion for next year? [Laughter.] I did not mean to embarrass you; I am sorry.

Did you have any further questions, Mr. Arnold?

Gentlemen, you may be excused, and we would like to ask Mr. Walsh one more question. Thank you very much, Mr. Edmund.

Mr. ARNOLD. Mr. Walsh, did Dr. Flemming or any member of the Office of Defense Mobilization make any requests during the third quarter to GSA to submit facts, information, or prepare a report or to make a survey concerning the aluminum industry of the United States to aid Dr. Flemming in any decision on whether a third round on whether an expansion goal should be kept open or closed? Mr. WALSH. No, sir.

Mr. ARNOLD. That is all.

Mr. YATES. Any other questions, any other witnesses? Thank you very much, Mr. Walsh.

Let the record show that Congressman Fascell, if he wants to submit anything for the record, may do so.

(See pp. 422, 427.)

Mr. YATES. The meeting stands adjourned.

(Whereupon, at 5 p. m., the subcommittee adjourned.)

APPENDIX

Congressman SIDNEY R. YATES,

ALUMINUM LIMITED SALES, INC.,

New York 20, N. Y., June 13, 1955.

Chairman Subcommittee No. 3, Select Committee on Small Business,

House of Representatives, Washington, D. C.

DEAR CONGRESSMAN YATES: In the course of the appearances of Mr. Nathanael V. Davis, president, and Mr. E. G. MacDowell, vice president of Aluminum, Ltd., before your subcommittee on May 19 we were requested to furnish additional information. Mr. George Arnold, counsel to your subcommittee, has also advised us that we could suggest corrections of inaccuracies in the transcript as prepared by the official reporter and that we could offer supplementary information which might,facilitate your understanding of our company and its operations. As for the additional information which you requested we are attaching hereto : I. Copies of correspondence between ourselves and the United States Government concerning offers of aluminum to the United States Government in response to requests made to us by various United States Government agencies. These include:

(a) Offer of 220,000 tons to Munitions Board in August 1950: Letter of August 21, 1950, to Mr. Hubert E. Howard, Chairman, Munitions Board, from Mr. Fraser W. Bruce, vice president, Aluminum Company of Canada, Ltd. Mr. E. G. MacDowell stated in his testimony on page 309 of the transcript that we dealt with GSA. However our original offer was to the Munitions Board although subsequent correspondence was with Mr. A. J. Walsh, Commissioner, EPS, General Services Administration, which we are also submitting.

(b) Offers to Defense Production Administration in 1952: (i) Letter of February 19, 1952, to Mr. S. W. Anderson, Deputy Defense Production Administrator for Aluminum, from Mr. R. E. Powell, president, Aluminum Company of Canada, Ltd.

(ii) Letter of April 19, 1952, to Mr. S. W. Anderson, Deputy Defense Production Administrator for Aluminum, from Mr. R. E. Powell, president, Aluminum Company of Canada, Ltd.

(The circumstances concluding these offers to DPA are described in Defense Production Act Progress Reports 19 and 20 of the Joint Committee on Defense Production.)

II. A statement regarding current prices for primary aluminum ingot in producing countries.

III. A table showing those of our nonintegrated customers (i. e., those firms that do not produce primary aluminum) in the United States who employ less than 500 workers and those who employ more than 500 workers. According to our survey, of our 114 nonintegrated customers, 68 employ less than 500 people each. It is of additional interest to note that the total number of employees of our nonintegrated customers directly engaged in the fabricating of aluminum is 53,100.

Concerning the corrections of inaccuracies in the reported testimony we are attaching a list of suggested changes. This is based on the official transcript purchased from Ward & Paul, 1760 Pennsylvania Avenue NW., Washington, D. C. Since the subcommittee showed a special interest in the system of certificate contracts and inasmuch as half of our certificate customers are categorized as small businesses, we are submitting a brief outline of how certificate contracts operate.

We understand from Mr. Arnold that your subcommittee intends to continue its review of problems on the aluminum industry with perhaps more attention to the possibilities of expanding ingot capacity. As Mr. Davis stated in his