That is the only particular in which your offer varied from the tender?

Mr. OBERSCHALL. Yes sir; that is right.

Mr. GILES. Can we have your name?

STATEMENT OF L. C. STOVALL, ASSISTANT VICE PRESIDENT, CONTINENTAL GRAIN CO.

Mr. STOVALL. Yes, sir. My name is Stovall and I am assistant vice president for Continental Grain Co.

The first question I would like to ask Mr. Oberschall is whether he is contesting the decision with respect to his vessel? If he is contesting the declination of his vessel, it is the first Continental Grain Co. knew of it.

Mr. GILES. You are saying you made your offer and you think they should have accepted it. You are asking the Maritime Administration to take some action or make some decision?

Mr. OBERSCHALL. I am here because Mr. Goodman told me yesterday on the phone to come down here and explain my offer.

Mr. GILES. Our purpose is to look into matters where we thought an offer was still on the board, where an offer had been made and turned down by the Continental Grain Co. Our process was to go through and identify those and not make a judgment as to what it was or the merits, but simply that the owner be here.

Mr. OBERSCHALL. If I can get the business for what I offer, I will take it. It's one way or the other. It is not of major or vital importance. It is just one ship.

Mr. GILES. You would like to have this particular shipment, but you don't feel strongly about it. You are not going "to sue" Continental Grain Co.?

Mr. OBERSCHALL. That is right.

Mr. STOVALL. The vessel offered originally as you said for U.S. gulf only, for February and March, which was outside our tender terms and the tender terms set forth by the Maritime Administration. The vessel was declined on the basis of the fact that we required U.S. gulf/North Atlantic options and in accordance with the terms, the shipping terms, set forth sometime back by the Administration as being reasonable, we required the last half of February or the first half of March for shipping dates.

Mr. Oberschall finally agreed he would accept either the last half of February or the first half of March in case the split dates were not suitable. However, he was not interested in USNH and could offer U.S. gulf only.

Inasmuch as all the chartering has been done, both American and foreign, with optional loading

Mr. GILES. Let me ask you this question: It is true your tender was U.S. gulf and North Atlantic and at the option of Continental and that was the reasonable way to state it and for most shipowners, they had no particular difficulty. Now, Mr. Oberschall has stated his precise factual situation so I would like to ask you this: Do you know have in the gulf area wheat which you have not committed to any other American ships or which has not been definitely chartered to a foreign ship which

is still available and which could-if you wanted to make that decision-which could be made available for the Penn Carrier?

In other words, is the wheat there out of the gulf?

Mr. STOVALL. At this particular stage of the program it would be almost impossible to ascertain, with any degree of accuracy, whether or not it is or isn't available. Consequently, we require some time for the purpose of moving cargo down from the interior. We required the optional loading to maintain maximum flexibility and again I repeat such option was obtained on all previous fixtures, both foreign and American.

Mr. GILES. I understand that. As of this moment, you do not know for a fact whether you would have or could work it out to have 15,700 tons more wheat to move out of the gulf which could go on the Penn Carrier?

You do not know that. Could you tell me when you would know that, when you would know it?

Mr. STOVALL. Without consultation with the export grain department it would be almost impossible to determine.

Mr. GILES. Do you have any estimate?

Mr. STOVALL. No, sir, I don't.

Mr. GILES. Would you know by February 15? Would you likely know by then?

Mr. STOVALL. This would again depend on what conditions he proposed in offering the vessel.

Mr. OBERSCHALL. March 15.

Mr. GILES. All right, out of the gulf. I am not trying to push you into anything, I am trying to get to the substance, to the facts. I want to understand what your physical situation is as well as to understand this part of our procedure. Let me state now that my line of questioning is not indicating that I think it proper or desirable to waive a technical point on the shipowners' behalf any more than on the part of Continental Grain Co. I think there should be an understanding so that we can all understand what is really involved. It is desirable to bring this out insofar as we can at this point.

Do you have a guess as to whether you would know by February 20? Mr. STOVALL. The movement of the cargo from the interior is not within the scope of my operation with the Continental Grain Co. I would say possibly, by February 20, it could be determined.

Mr. GILES. You would pick that date as a possibility?

Mr. Oberschall, if you were not informed definitely until February 20, that Continental could use your ship in the first half of March, what would you indicate as to whether that would be meaningful to you or, to state the question another way, would you have to try to make arrangements for your ship before February 20 and try to have a definite commitment on it?

Mr. OBERSCHALL. Well, I will naturally bid on every piece of business that comes up between now and February 20, but as I mentioned to you before, I expect to have the ship in a shipyard, therefore, I could conceivably wait.

Mr. GILES. The question I am putting to you is whether you have a situation on your side-where you could, in effect, take your ship off the market and stand the risk that Continental might or might not be

able to use it. In other words, would you give Continental a firm option until February 20?

Mr. OBERSCHALL. No, I could not do that.

Mr. GILES. Mr. Stovall, do you have any further comment?

Let me ask you this question-excuse me, ladies and gentlemen, I should have announced at the beginning of our procedure the names of those participating here.

On my right is Martin Goodman, Chief of Shipping Operations, who has been with us very much all along in this, and as to whom I would like to say good things as I said to Mr. Bonner's committee last week. Captain Goodman and his staff have been a tower of strength to the Government, to the Maritime Administration, Department of Commerce, in handling this matter from the beginning.

On my left is General Counsel of Maritime Administration, Mr. Robert Ables, of whom I would say for the record he is extremely and outstandingly able.

On his left is Captain Tirling of Captain Goodman's office.

Now, Mr. Stovall, when will Continental charter foreign vessels for their tonnage out of the gulf as to what is still remaining?

Mr. STOVALL. I presume that after this hearing, Mr. Giles, and a decision is made as to our position with respect to waivers. We would have to look at the waivers, if any, which are granted and then determine the quantity required and the respective positions.

I might state that economically we require the options and I feel it would impose an undue hardship on Continental as an exporter, from the point of view of economics, to have to concede an optional loading to either Mr. Oberschall or other owners.

Mr. GILES. Captain Goodman, do you have any questions of Mr. Oberschall or Mr. Stovall?

Mr. GOODMAN. Mr. Stovall, if you find it would be difficult-I believe you said it would be difficult for you to advise Mr. Oberschall before February 20 whether or not you could conceivably use his ship in the gulf—I would like to be more direct in terms of Mr. Giles' question. Would you then be waiting until February 20 before you charter foreign vessels to meet this?

Mr. STOVALL. We might very well, but every foreigner chartered so far we have maintained the flexibility of the range or the gulf in order to meet this very heavy schedule. Again, I would like to ask Mr. Oberschall if he is really interested in this business because I am surprised that there is any contest or protestations over our declining the vessel.

Mr. GILES. Would you be more specific on that question? Are you saying that it was your understanding yesterday or some previous day that Mr. Oberschall had withdrawn his vessel?

Mr. STOVALL. It was my understanding yesterday that Mr. Oberschall preferred other business and possibly was just as pleased that his vessel would remain open to work other areas.

Mr. GILES. Well, I understand Mr. Oberschall said here this morning that if this matter can be definitely settled today or tomorrow or whenever we make a final decision and, if it were definitely settled in his favor to take the ship out of the gulf the first half of March, that he definitely would take that charter. Mr. Oberschall, would you comment?

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Mr. OBERSCHALL. If I get the charter for March 15 for 15,700 tons, at 5 percent, more or less bulk free, I will take the business. Whether I would prefer some other business is really of no consequence at all. To be truthful, I might prefer other business. I am Hungarian and not very happy about shipping wheat to Russians, but since the regulations are made by the Maritime and my being an American shipowner, I will comply with all the regulations, as long as it is not a financial hardship on us. U.S. North Atlantic loading would be very difficult, therefore, we offered U.S. gulf only. I might point out in that charter point, Continental has to give some notice for a ship that comes back into on ballast from the Mediterranean on past the Malta. That is about 15 or 16 days steaming.

In other words, if my ship is ready on February 15, Continental would have to declare the loading range on this vessel.

Mr. STOVALL. We had hoped at this stage we would have fully covered the entire chartering operation for this program, but in our efforts to give maximum amount of U.S. tonnage participation in this program, we deferred application for waivers from January 22, until January 31, again with the 5-day waiting period.

When this tender was published, we had hoped by February 1 we would have fully booked both American and foreign vessels.

If this had been possible, our tonnage allocation of shipment could have been made.

Mr. GOODMAN. Mr. Stovall, could you or some other member of Continental tell us approximately how much time it takes for you to order your cargo in from Seaboard to its source? I have in mind particularly this March 1 to 15. How much time does it normally take to move it from Seaboard to any place in the gulf?

Mr. NORTON. My name is Ben Norton. I think the ordering of the cargo is a rather immaterial point. We operate various Seaboard elevators and some of the positions are determined at the last minute.

In other words, we want to control the vessel until practically the last minute. We can have congestion in Galveston or Houston and maybe we might want to go to Boston. We want flexibility of loading elsewhere.

Mr. GOODMAN. I appreciate that, but, Mr. Oberschall, I concur with what you said. Normally you would have to declare any vessel coming out of Malta normally around the 15th. In relation to that, if you were positioning a foreign ship, when would you reasonably know? I can't quite follow Mr. Stovall's reply to the original question. When would you know you can use the ship in the gulf or someplace else? When your charter is known, you would have to know? Mr. STOVALL. Was this in the form of a question?

Mr. GOODMAN. Yes.

Mr. STOVALL. I believe with the speed of these vessels, 15 days would be a bit of a long voyage. Ten days would possibly be more in order. Here again, we don't expect that every American ship we are going to charter would be coming from the Mediterranean in ballast-only a small percentage would be.

Again, as a said, we had hoped by February 1 to be fully covered charterwise, so if there was two or three or four vessels returning from India or Pakistan we would be in position to declare ourselves, and we might require the owner to go to the gulf to load. This has happened

with foreigners. We have vessels that we have withheld declarations of loading date right today. Because of this hearing it has been necessary to renegotiate some of the foreign charters.

Americanwise this program is based largely on the utilization of tankers operating coastwise alternatively bulk carriers in ballast the same as Penn Carrier. This would automatically preclude declaration 10 or 15 days ahead of schedule as to the loading area.

These points were all discussed and dealt with, however, we felt on American ships, the necessity of making arrangements to receive the vessel if coming from the Mediterranean, certainly before he passed Gibraltar outbound. If at all possible, we could give the ship orders as early as possible.

Mr. GILES. Mr. Stovall, does it come down to this, as far as early March, as to your shipping arrangements whether they would be out of the gulf or North Atlantic, you will give the word to the shipowners, those you have already chartered as early as possible?

Mr. STOVALL. Yes, sir.

Mr. GILES. There is no contractual commitment right now. I want to be sure on this point, I want to be sure that you will give a set number of days' notice. Take a ship you have already chartered out of the gulf or North Atlantic, what is the latest date you can give the ship notice as to where to go, whether to the gulf or North Atlantic, for the first half of March?

Mr. STOVALL. There are many vessels that would not require orders before

Mr. GILES. Does that depend on each situation?

Mr. STOVALL. I think so, yes.

Mr. GILES. That is not covered by your charters?

Mr. STOVALL. No, sir. We did determine that a vessel coming from the Mediterranean would apply for orders, as to the loading areathey would apply at Malta and the loading area would be declared 48 hours afterward or before arrival Gibraltar and his loading port 5 days prior to his estimated time of arrival at loading area. Mr. GILES. Five days prior to?

Mr. STOVALL. Yes, sir.

Mr. GILES. That is on the respective number of days in your charter? Mr. STOVALL. Yes, sir; only with respect to foreign vessels. It is negotiable and some owners have requested 5 days after sailing from the other side, other have requested 7 days and others asked for 48 hours off USNH. It has been a negotiable item depending on speed.

Mr. GILES. As I understand it, I would sum it up this way: you actually have American vessels for the gulf or North Atlantic and you will be actually informing the shipowner which port area-I am talking of the first half of March-you will be informing the shipowners at various times, depending on each case. Some may have a month's notice, others may have only 5 or 6 days. But all have at least 5 days?

Mr. STOVALL. I would say yes, all would have at least 5 days. Mr. GILES. I would say if Mr. Oberschall would give you a definite commitment for February 20 and on your part you would give him a commitment that you would take him out of the gulf, if that could be arranged-but you would not know for certain until February 20but if he gave you an option until that date, would you agree to that? Mr. STOVALL. On declaring the range or loading?