It is significant at this point to note also there is not included in our figure of savings on petroleum and its products any in-bound movement. Recent evidence has come up indicating that there is a strong probability that there will be some in-bound movement of crude petroleum.

Senator MCCLELLAN. That is to supply those refineries at El Dorado?

Mr. BURDICK. Yes, sir. There already has been some in-bound movement by rail because water was not available, gasoline for blending purposes, even since our survey was started. However, that is not included in the total.

Nor is it believed that any long period of time would elapse before a lively traffic in this commodity would be built up, once the waterway is placed in condition to accommodate it. Only 2 days ago, on July 18, at a meeting in Camden, Ark., shippers and towing interests urged the immediate clearing of the present 612-foot channel, so that movement of this product could be initiated, even with the existing inadequate manually operated locks and tortuous and poorly maintained channel conditions, which would be corrected by the proposed project, thus permitting greater savings than can now be realized. As to the rate of savings claimed, the $3.50 per ton was based on actual rate studies which showed savings as high as $8.22 per ton for refined products in containers moving to Cincinnati and $3.89 for bulk movement of gasoline to New Orleans and $1.69 for fuel oil in bulk. Incidentally, these rate studies were based on rail rates as of January 1. 1947, including the increases granted in ex parte 162. Since that time the railroads have asked for a 13-percent increase and have been granted 6 percent as a temporary measure in ex parte 168 new pending before the ICC.

While on the subject of petroleum and its products, I would like to draw attention to the matter of oil field supplies and equipment, such as derrick steel, pipe, pipe fittings, and the like. An item of 10,000 tons of steel products and iron will be noted in the tabulation. The savings on this commodity are estimated at $9.61 per ton. A recent statement attributed to a large steel company is to the effect that they would use the waterway for an in-bound movement of 100,000 tons annually. I have not had opportunity to verify this statement and have not added this tonnage to the tabulated items, but I do desire to note the possibilities of this type of commerce which enhances greatly our previous estimates.

Although my forecast of the volume of traffic and the savings in freight costs for this one industry alone exceeds the total estimates se up by the Board for all commodities for the entire area, I cannot receia, from estimates of value of the waterway to this industry. The inj dustry is there; it is producing and it will certainly take advantage f the opportunity to effect large savings for itself and its customers the opportunity is made available.

The second item of importance on which I wish to comment is commodity known as methanol, an antifreeze compound. A plant a Sterlington, La., manufactures this product in large quantities an nearly all of it would move by barge if water transport were availab Distribution is made to such points as Minneapolis, Chicago, Peor St. Louis, Cincinnati, Louisville, and Pittsburgh, all of which have water transport facilities. Shipments are also made to the easter

seaboard via a tank farm at Harvey, La., where berthing facilities are available for any size vessels. A wharf with floating landing stage has been installed at Sterlington for convenient barge loading. This company is ready now to move most of its product by water and only awaits the provision of a suitable channel before doing so. They anticipate a movement in 1949 of 15,000,000 gallons or about 56,000 tons of methanol in bulk plus a considerable amount in containers. They will have an in-bound movement from Texas points and the New Orleans area of close to 10,000 tons of raw materials and containers. Senator LONG. Something has been said about the ore deposits in that area. Is there any possibility of the development of a steel industry in that area?

Mr. BURDICK. I think not; no, sir.

Senator LONG. There are no actual ore deposits?

Mr. BURDICK. I do not think there are sufficient iron deposits which would make the development of the steel industry economical in that

area.

Senator LONG. There is a lot of bauxite ore, of course?

Mr. BURDICK. Yes; bauxite is, of course, a great industry there. Our tabulation shows 40,000 tons annually as the predicted waterhorne commerce at savings of $7.70 per ton, or a total of $308,000. The rate of savings is based on freight differentials between rail and water transport to Peoria, Ill., a distance somewhat below the average distribution distance.

It is submitted that the facts I have related amply justify this claim. Fertilizer: The tabulation lists 120,000 tons of this item at freight savings of $2.02 for a total annual saving of $242,400.

At the present time one manufacturer in the trade territory produces 375.000 tons annually. The market for this commodity is described as "Southeastern States and Export." The destination of the major portion of this commodity cannot be foreseen at this time for the reason that the fertilizer-producing industry in this region is at present in an unsettled condition.

Two proposals are now being presented: one to construct a fertilizer piant of rather large capacity at or near Greenville, Miss., which hight provide an outlet for part of the raw materials now being Trocessed in the Ouachita area. The other is the formation of a large fertilizer-handling company in Arkansas. This company would probbly utilize existing manufacturing facilities to the extent possible. These proposed facilities would, in all probability, reduce the local narket of the existing plant on the Ouachita River and thereby force greater proportion of its product into the export field. Because this njecture is too vague to rely upon, no thought is entertained of tering any claim for increase in the prospective water shipment of his commodity. But it is believed that the former figure mentioned bove for import of raw materials and export of finished product is ell supported by circumstances in which the industry is operating the present time. This figure, 120.000 tons at $2.02 per ton for a tal saving of $242,400 is therefore tabulated.

Paper and paper products: The tabulation lists 50,000 tons of these ems at savings of $3.58 per ton or a total of $179,000.

There is a total annual production of these products along the river on Camden to Monroe of approximately 560,000 tons, and the lants are all rapidly expanding in size. Raw materials other than

pulpwood used in the production total about 300,000 tons now and will undoubtedly double within a few years. It is felt that our estimate of the portion which will move by water of 50,000 tons of finished products at savings per ton of $3.58 totaling $179,000 and 60,000 tons of raw materials at average savings of $0.67 per ton or $40,200 annually, is extremely conservative.

Hardware, miscellaneous: This constitutes the fifth item in the tabulation in point of money value of savings.

The amount of 14,000 tons which is claimed as prospective waterborne commerce is, of course, only a minor portion of the total amount consumed in the area. However, the rate per ton of $7.29 savings makes the total savings of $102,000 a considerable amount. Again the predicted savings are based on actual rate studies of a number of items from various points of origin. For example, on shipments of wire fencing, nails, et cetera, from Cincinnati to Monroe, La., a freight differential of $9.51 per ton can be realized; from St. Louis this saving is $7.32 per ton; from Birmingham it is $4.60.

It is not believed that this claim is so optimistic as to need further defense.

Other items in the tabulation are worthy of mention. For example, the item of 10,000 tons of steel products and iron which I have already mentioned suddenly gives promise of approaching or exceeding 100,000 tons with savings of nearly a million dollars.

Senator MCCLELLAN. That is principally piping for oil wells? Mr. BURDICK. Derrick steel and pipe and pipe fittings, and that sort of thing.

Senator MCCLELLAN. If other oil fields were discovered and there was further development in there, that tonnage would increase?

Mr. BURDICK. Yes, sir, and the fields are constantly developing. New wells are coming in almost monthly in that area.

Roofing and roofing felt are respectively the product of and a raw material for a large industry. Savings of over $100,000 could be realized by this industry by use of a suitable waterway. Canned goods are mentioned as only one item in a huge wholesale grocery industry. Yet savings on this one item will run as high as $65,000 per year. Sugar, to mention another item of vital food stuffs, should yield another $45,000 in annual savings. The savings on anhydrous ammonia, considering not over 10 percent of production in the area, will be over $40,000 per year.

I shall leave the balance of this tabulation to your individual scrutiny, with the remark that all commodities shown therein are susceptible to movement by water, the tonnages set up are conservative rather than overly optimistic and the rates of savings are based on actual comparisons between rail and water rates and are readily demonstrable.

I would now like to revert to a consideration of the item barite which I mentioned earlier as having been included in our 1946-47 traffic survey for probable movement from Malvern. The figure used was 100,000 tons annually at estimated savings of $4.08 per ton when hauled from Malvern to Lake Charles, La.

We used the point of Lake Charles because that is rather centered in the destination areas to which that product would be shipped.

At our meeting 2 days ago at Camden it was brought out that this 100,000 tons almost hit the direct figure available now, which is for

next year.

Senator MCCLELLAN, It would move from Camden instead of Malvern?

Mr. BURDICK. That is right, and still offer them sufficient savings. Contract negotiations are now under way between producer and a towing company for €0,000 tons to be moved the first year and 120,000 tons per year thereafter. I am not aware of the terms of this contract and so cannot estimate the amount of savings but it should be very appreciable. The point is that this is new tonnage not contained in the tabulation herewith. It furnishes further positive evidence of the need for improvement of this waterway as requested and as recommended by the Chief of Engineers. It also provides evidence of the value of an extension northward from Camden in the years to come.

Indirect benefits: To the anticipated savings in transportation costs there should be added the benefits arising from those factors commonly referred to as indirect but which do in fact represent actual concrete value.

The bank stabilization and channel rectification which will be necessary as incidental work in connection with the construction of navigation works will provide incidental benefits in addition to those arising from che per t'ansport. These benefits will accrue in the form of dec. cased erosi a of river banks, greater protection for properties along the river banks and for bridges and their abutments, and better drainage of adjacent lands.

Benefits arising from the provision of recreational possibilities along slack water pools are too well known to require much discussion. No formula is known to exist for the computation of such benefits but the commercial possibilities inherent in the situation should provide some actual revenue in addition to the enhancement of health and the general morale and happiness of the people of the region.

With a greater volume of water in the navigation pools during the low water season, pollution from industrial wastes and sewage will be considerably reduced. Large sums are constantly being expended throughout the country on antipollution measures. It is estimated that the benefits from this source along the Ouachita River will serve to reduce such expenditures materially.

Cheaper transportation means much more and greater profits on established business. It attracts new business to the territory which enjoys such a saving. This region is already conducting a retail sales business of well over $100,000,000 annually and wholesale sales of more than half that amount, much of which is from shipments of local products to points outside the territory. An enhancement of at least 2 percent of this present business should occur within a few years after completion of the 9-foot waterway.

National security: This statement would not be complete without mention of the element of national security. At the time of writing, the United States has only recently emerged from a war which taxed every resource at its command. Recovery from the scars of that war is by no means complete. Internal and external problems of the gravest import are being faced by the Nation. One of the most press

ing of the internal problems is that of transportation. Car shortages exist, motor transport production has not reached a satisfactory state, and highways require terrific expenditures for maintenance and expan sion. For the sake of security of potential war production facilities, three factors must not be overlooked: First, such facilities must be deployed over a wider territory than is at present the case; second, it is vital that an adequate proportion of such facilities be withdrawn from our vulnerable seaboard; and third, the areas in which industrial facilities are installed must be connected with other parts of the country with an effective system of every known form of transportation. The Ouachita Valley provides its proportion of each of these security elements. The trend toward greater industrialization is positive and is occurring at a rapid rate. Its location provides as great a degree of protection from outside aggression as almost any other part of the country. Finally, transportation facilities, while effective, would be rendered much more adequate by a water connection with the rest of the country.

Attention is invited to the fact that there now exists at Camden, Ark., a large naval ordnance plant which was completed near the close of World War II. In the event of another emergency an inland waterway would be of inestimable value to this installation.

Conclusion: In conclusion, I would like to summarize our plea for authorization of this project with the following observations:

(a) The Chief of Engineers has reported favorably on modification of the authorized navigation project on the Ouachita-Black Rivers below Camden, Ark., to provide a channel 9 feet deep and 100 feet wide from the mouth of Black River to Camden, mile 351. He has based his favorable recommendation on prospective commerce on the improved waterway of 430,000 tons per year with attendant annual savings in freight costs of $1,515,600 compared to total annual charges of $1,165,000, providing a benefit-cost ratio of 1.30 to 1.

(b) Without desiring to appear disparaging of the judgment of the Corps of Engineers, I have placed before this committee facts and figures which shows the benefits estimated in the Board of Engineers' report to be ultra-conservative. In other words, I have supported the Chief of Engineers' recommendation with a far more optimistic show. ing of probable benefits.

(c) The amount of prospective commerce which I have placed be fore the committee is supported by the showing by other speakers of the extent of commerce and industry in the region.

(d) Although this project would provide a worthwhile item of public works to be undertaken in time of recession and a high rate of unemployment, it is a project of such merit in its own right and with such great promise of economic benefit that it should be authorized now and not relegated to a backlog of works to be undertaken only in time of economic disaster.

The Ouachita Valley Association urges its inclusion in the authorization bill now under consideration.

Senator LONG. May I ask a question about the study you have here! Mr. BURDICK. Yes, sir.

Senator LONG. You have coffee on here-600 tons. I assume that would be coffee moving up from New Orleans.

Mr. BURDICK. Yes, sir; imported coffee.