Mr. BENNETT. Every contract that you are going to make to expand mineral and metal production in the country under the authority given you last fall by Congress must be through and finished?

Mr. LYON. Yes.

Mr. BENNETT. By June 30. Do you think you are going to be able to get it done by then?

Mr. LYON. I think we will.

Mr. ENGLE. You are not writing a floor price this time, are you? You are just announcing that you will buy certain chrome ores at $115 a ton on selected contracts?

Mr. LYON. There is no floor at all. That is the price.

Mr. ENGLE. What do you mean of course it isn't a floor with chrome since the world market is about one-third of that, but whenever you state a price that is not only the floor but the ceiling? Mr. LYON. Yes.

Mr. ENGLE. Would a man send in a card and say, "I agree to this,” in the same manner you handled the tungsten program?

Mr. LYON. Yes. I think that will be about the way it will go, except that he will have an allocation of tonnage.

Mr. ENGLE. If we don't get to wheeling on this pretty fast we are going to run out of time, is that right?

Mr. LYON. That is right.

PRICE TO BE PAID FOR CHROME CONCENTRATES SET AT $110 A TON

Mr. ENGLE. If a fellow has some high grade he can do pretty good, can't he?

Mr. LYON. That is right.

Mr. ENGLE. Two thousand tons at a hundred dollars?

Mr. REGAN. $115.

Mr. ENGLE. Make it easy. Figure that is $200,000, and if it costs him $50 a ton to get it out he can make a hundred thousand dollars on that contract.

Mr. LYON. That is right.

Mr. ENGLE. There is a chance for two or three fellows to get nice and fat on this proposition whereas my people down in northern California are completely out on the limb because they have to concentrate it all. Isn't that right?

Mr. LYON. They have to concentrate it; yes.

Mr. ENGLE. How much are you paying for concentrates?

Mr. LYON. I believe it is $110.

Mr. ENGLE. That is a very, very interesting proposition. You are paying $115 for high grade, which is lump high grade?

Mr. LYON. That is right.

Mr. ENGLE. And you pay $5 less if they concentrate it?

Mr. LYON. Yes.

Mr. ENGLE. What are you trying to do, kill the concentrate ores off?

Mr. LYON. No, sir; because the lump ore is much more suitable for a furnace than the concentrates, which have to be further treated and nodulized before they can be used so they have less value than the lump ore.

Mr. ENGLE. You are talking about value from standpoint of utilization. Is this an incentive program or not?

Mr. LYON. It should be.

Mr. REGAN. And as I understand if it isn't sufficient incentive you will probably modify it to get the results we are trying to achieve! Mr. LYON. It will have to be reconsidered.

IMPROVED DEPARTMENTAL COORDINATION SAID TO MAKE

THE JUNE 30, 1951, DEADLINE FEASIBLE

Mr. REGAN. Do you get your certification from Defense Mobilization as to what minerals they want?

Mr. LYON. There are 88 minerals and metals.

Mr. REGAN. You will have to get a separate program for each of those 88?

Mr. LYON. Yes.

Mr. REGAN. Will it be physically possible for you to get those out before the deadline of June 30?

Mr. REGAN. Also word to the miners in the respective districts that they will have to file their names, et cetera ?

Mr. LYON. Well, Mr. Regan, they are not all going to require

programs.

Mr. REGAN. How many of the 88 may require that?

Mr. LYON. Probably dozens, the real important ones.

Mr. REGAN. So time even though short will be sufficient to get the program in operation thoroughly, now since the various departments seem to know what is desired?

Mr. LYON. Yes. The coordination is very much better.

Mr. REGAN. That is certainly gratifying. Are there any further questions?

PLANS NOT YET FORMULATED FOR CONCENTRATING THE EXISTING CHROME STOCKPILE AT YREKA, CALIF.

Mr. ENGLE. One further question, Mr. Chairman.

Do you have any plan at all to concentrate your 10,000-ton stockpile! Mr. LYON. None at present, sir.

Mr. ENGLE. Do you have the power under the act to do it?

Mr. HOFFLUND. Certainly. We have the power under the act to recommend it, not to do it.

Mr. ENGLE. Who will do it?

Mr. LYON. GSA.

Mr. ENGLE. You could recommend a program for the purpose of setting up concentrating plants to take care of the Yreka stockpile, couldn't you?

Mr. HOFFLUND. Yes.

Mr. LYON. Yes.

Mr. ENGLE. Why don't you do it?

Mr. LYON. It is just one of those things sir that we want to get some of this money allocated and through before we hit them with the whole thing.

Mr. ENGLE. Before you what?

Mr. LYON. We don't want to hit them with too much money or we won't get any.

Mr. ENGLE. Who will do that?

Mr. LYON. The authorities that provide the money.

Mr. ENGLE. I will tell you, that the Congress is mighty concerned about whether or not we are going to have enough of this stuff to fight a war with and I don't want to be sitting around here and responsible for it if we get into an all-out shooting war and don't have it, and I am certainly protecting the record.

FOREIGN SOURCES OF CHROME ORE

Mr. DONOVAN. What are the foreign supplies? Where are the foreign supplies of chromium?

Mr. LYON. Turkey, and in the west African coast principally, some in the Philippines, some in South America.

Mr. DONOVAN. Do you know anything about the condition of our stockpile of chrome?

Mr. LYON. Yes. That is classified material. I can't talk about that. Mr. DONOVAN. Have we got enough?

Mr. LYON. I can't tell you that, sir.

Mr. DONOVAN. You mean it is secret?
Mr. LYON. Yes.

Mr. BARING. Mr. Chairman.

Mr. REGAN. Mr. Baring.

STATUS OF LOAN APPLICATIONS PENDING BEFORE DEFENSE MINERALS ADMINISTRATION

Mr. BARING. On March 20, Dr. Boyd testified that no applications had been certified by the DMA for loans. Are there any today, 1 month later?

Mr. LYON. I am not sure. Have there been any loans certified? Mr. HOFFLUND. I don't believe any straight loans have been certified.

Mr. LYON. The usual procurement contract, or guaranteed loan, is usually sufficient. We haven't had to make any direct loans to get things done. There is the certificate of necessity and the procurement contract. They have usually been enough.

Mr. BARING. At that time there were some 525 applications before you. Why aren't these applications receiving attention?

Mr. LYON. They are receiving attention, sir. "The applicant makes an application for a loan, not knowing just what the procedure is, and when he finds out that he can get a contract for the metal that he produces at a certain fixed price over a period of years, he is also able to either finance himself in some other way, than to ask the Government for a loan and that is the way it is usually done.

Mr. BARING. I have letters here from all over the country, not only from my own State but from other States that produce minerals, in which they have told me how they have tried to get loans and used up their own money for machinery and are now on the brink of despair. They can't go further. They have known deposits that the Bureau of Mines has gone out and investigated.

Mr. LYON. Well, Congressman, this administration that we are running down there is not a give-away administration. It is what you might term a loose-banking outfit.

Mr. DONOVAN. A loose

Mr. LYON. Loose-banking outfit. That is what we are.

We have to see some chance of getting a loan repaid, or we can't go ahead. The law just don't provide for anything like that.

Mr. BARING. You think the law we are working under now is inadequate?

Mr. LYON. A lot of people have made application with inadequate ore reserves, where a loan couldn't be recommended.

Mr. BARING. Some of these deposits are known to be adequate. Congress enacted this legislation last September thinking we gave you broad enough powers and you think you haven't got the powers to operate right now.

Mr. LYON. We haven't got the powers to operate when we know it is going to turn out as a loss.

Mr. BARING. We are worrying about a war. When we want and need metals, we pay for them. That is what we are concerned with now. We are not concerned with the operations turning out as a loss. when we have the threat of losing our country. Our objective is to establish a minerals program here. Then, in the event of war, and if our sealanes are cut, we will have a going domestic mining industry.

GENERAL DISCUSSION OF CHROME OPERATIONS IN SOUTHERN OREGON

Mr. DONOVAN. Will the gentleman yield?

Mr. BARING. Yes.

Mr. DONOVAN. Tell me who the three interests are who have this high-grade chrome that you know about, these people that are going to make a big profit, at this price of $115. I want to know their names. Mr. LYON. I will have to find out for you. I don't know their

names.

Mr. DONOVAN. You know they exist?

Mr. LYON. I know there are several properties existing there that have produced.

Mr. DONOVAN. Where are they located?

Mr. LYON. They are located in southern Oregon, I believe.

Mr. DONOVAN. What part of southern Oregon?

Mr. LYON. Near Grants Pass.

Mr. DONOVAN. What county is it in?

Mr. LYON. I wouldn't know.

Mr. DONOVAN. How long have you been the Director of the Supply Division?

Mr. LYON. Since February 8.

Mr. DONOVAN. You are a western mining man by experience, aren't

you?

Mr. LYON. Yes.

Mr. DONOVAN. What State do you come from?

Mr. LYON. Utah.

Mr. DONOVAN. Are you familiar with that section of southern Oregon?

Mr. LYON. I have only made one trip through there, sir, about 20

years ago.

Mr. DONOVAN. What is the nearest big town to where these deposits are located?

Mr. LYON. Grants Pass is the only sizable place.

Mr. DONOVAN. Does anybody in your Administration know who the owners of these high-grade chrome deposits are?

Mr. LYON. I presume, yes.

Mr. DONOVAN. Who would know?

Mr. LYON. Mr. Bradley is here. I believe he would know.

Mr. DONOVAN. Is he here?

Mr. LYON. Yes. He was.

Mr. REGAN. Could you supply that information, Mr Bradley, as to who the owners of the high-grade chrome mines are?

Mr. BRADLEY. Well

Mr. DONOVAN. Who stand to make a quick two or three hundred thousand dollars?

Mr. BRADLEY. I don't think anybody will make any money like that.

Mr. DONOVAN. Who are the owners?

Mr. BRADLEY. A man named Robertson, a man named Brown.

Mr. DONOVAN. What is his first name?

Mr. BRADLEY. That I don't know.

Mr. DONOVAN. Where is his place of business?

Mr. BRADLEY. His residence I presume is Grants Pass. I don't have that in mind.

Mr. DONOVAN. Who are the others?

Mr. BRADLEY. A guy named Brown.
Mr. DONOVAN. What is his first name?

Mr. BRADLEY. I don't know that.

Mr. DONOVAN. What is his residence?

Mr. BRADLEY. Grants Pass to the extent of my knowledge.

Mr. DONOVAN. The third one.

Mr. BRADLEY. I imagine a Mr. Bristol has a pretty good hold.

Mr. DONOVAN. How do you spell that?

Mr. BRADLEY. B-r-i-s-t-o-l.

Mr. DONOVAN. What is his residence?

Mr. BRADLEY. Grants Pass.

Mr. DONOVAN. Are they all associated with one another, if you know?

Mr. BRADLEY. They are associated insofar as-Oh, there is some chrome mine association up there. They are all members of it.

Mr. DONOVAN. At what price below the $115 mentioned there could their deposits be bought or exploited and still have them make a fair profit?

Mr. BRADLEY. I don't think they could make money-that would take enough money to put them in a business up there if they didn't have at least a hundred dollars and it may require all of the $115 to put the thing on a break-even basis.

Mr. DONOVAN. Then you disagree with what was previously said here by the other members of your own Administration as to how much money could be made on this high-grade ore in southern Oregon? Mr. LYON. We didn't say that; Congressman Engle put forth that arithmetic.

Mr. REGAN. Mr. Engle used the figures.