Mr. DODD. I would guess we might have another year yet before the cycle would reach the limit. Mr. KEEFE. What is the reason for the decline in the sheep population? The feed lots are all empty nowadays. Mr. DODD. Of course, one of them is that these folks have been pretty scared by the cattlemen with the high beef prices, and they have done two or three things. One is they have culled their herds as hard as they could. Mr. KEEFE. I am speaking specifically about sheep and mutton. Mr. DODD. On sheep and mutton, it goes back to the beginning of the war and even before the beginning of the war, when it was largely a labor question. It was at that time. They could not get deferment for the sheep herders and lamb tenders, and where most of our sheep are raised in the big areas of the West, where you have to depend on running them on the range, the good sheep man is just not going to have a band of sheep with lambs at their sides, in which he has $25,000 or $30,000 invested, with no experienced herder to look after them. He is just not going to do it. And every year the war progressed he had more and more trouble with labor, and he said, "I am going to liquidate my sheep." And the price was fairly good; so he just cut them down. Also, he had difficulty selling his wool at a price attractive enough to maintain production of sheep and wool. AVAILABILITY AND PRICE OF WOOL Mr. STEFAN. But you had that support program. How much wool do you have on hand? Mr. DODD. We have about 230 million pounds at the present time, compared with over 500 million pounds 18 months ago. Mr. STEFAN. About what did you pay for it? Mr. DODD. About 42 cents, farm price. Mr. STEFAN. What are you going to pay for Argentine wool? Mr. DODD. We are not going to buy any Argentine wool. Mr. STEFAN. Well, somebody is going to buy Argentine wool. Mr. STEFAN. Do you know what they are going to pay for Argentine wool? Mr. DODD. No; I do not know anybody who is going to buy Argentine wool. ERP might buy some, but so far as Commodity Credit is concerned, we are not going to buy any. Mr. STEFAN. Do you know what we are going to pay for that Argentine wool, Mr. Nitze? Mr. NITZE. I do not have that figure here. Mr. STEFAN. It is less than 42-43 cents? Mr. NITZE. The foreign price of wool is considerably less than the domestic price of wool. Mr. STEFAN. You gave us the price that you were going to pay in Argentina the other day; you should have it here now. Mr. NITZE. I do not have it before me. Mr. DODD. We have a 25.5-cent duty in this country on scoured wool and if you take about half of that and put it on your grease-wool price, you would have the difference between the foreign wool and ours. Mr. NITZE. The price that I have here is $683 a metric ton. That would have to be divided by Mr. NORTHRUP. It would be a little better than 30 cents. Mr. NITZE. Yes, a little better than 30 cents. The CHAIRMAN. Why would you be buying Argentine wool? Mr. STEFAN. When you have 238 million pounds of American wool on hand? The CHAIRMAN. And on top of that, you have only gotten rid of about 100 million pounds Mr. DODD. About 250 million pounds, Mr. Chairman. The CHAIRMAN. You got rid of about 100 million pounds since January 31? Mr. DODD. I was talking about Commodity Credit stocks. The CHAIRMAN. I have their statement here in front of me; you had, or they had 341 million pounds as of January 31. Mr. DODD. That is this year? The CHAIRMAN. Yes. Mr. DODD. Commodity Credit Corporation stocks on January 1 totaled 342 million pounds. I was talking of the last 18 months. Our big sales were last fall. Mr. STEFAN. How much did you get for it? Mr. DODD. For choice combing fine and half blood wools bought before 1947, we got all of what we paid plus carrying charges. rest of it we have not been able to get our money back. Mr. STEFAN. How much did you offer it for? On the Mr. DODD. We have tired to meet world prices with tariff added, but the consumers in this country do not like to have clothes made of wools under half blood. To satisfy this demand the manufacturers want either something finer than 58's, or for carpets or rugs they want something coarser than anything we have in the CCC inventory. Mr. STEFAN. What proportion of the 238,000,000 pounds of wool that you have is of the 58 quality? Mr. DODD. About half of it is in the 50's to 58's quality. Mr. DODD. That is the information that I gave the Agriculture Committee that was considering the extension of price support; the Commodity Credit stocks of wools, finer than 58's, they have been able to move without too much trouble. But those in-between grades, from 50's to 58's, we have not been able to move and we have added to our stocks each year since 1943. Mr. STEFAN. Here is half of the 238,000,000 pounds of wool which the Commodity Credit Corporation has on hand, on which they are liable to take a loss. Why could you not cut down on the amount of wool that you are buying from the Argentine and buy these stocks that we have on hand in our own warehouses, which were paid for by the Federal Government? Is it because that is not the kind of wool that they want over there? Mr. DODD. Some of them would probably buy it, but our wool would be at a higher price than wool in the world market. The CHAIRMAN. About a month ago, the price of wool that was suitable for carpets was 75 cents. Mr. DODD. That is on a scoured basis. Mr. STEFAN. What is that? Mr. DODD. When you take grease wools and scour them, it takes away roughly half the weight of the wool as it is originally shorn from the sheep. Of course, some wools scour out more than others. There was a proposal-I think it was made before the Senate Agriculture Committee, and I think it also has been put before the House committee-to set up a revolving fund to be used by the Army to purchase fibers for manufacture in the occupied areas for resale. We suggested that it might be well for them to use our surplus cotton and flax and wool-those things that we do have in surplus, of those grades that we have in surplus. I think there was an amendment to the bill-I have not followed it closely, but I believe there was an amendment to the bill added in the Senate. Mr. STEFAN. You do not anticipate any trouble, then, getting rid of your 238,000,000 pounds of wool, Mr. Dodd, one way or another? Mr. DODD. I think we can get rid of it somehow or other. Mr. STEFAN. Either through shipping it to occupied areas or to some of the countries under the ECA program? Mr. DODD. That is right. Mr. STEFAN. Then there will be a shortage of wool. What will be the wool situation then? We now have a shortage of sheep. Mr. DODD. We import wool into this country regularly. Our textile mills use a great deal more than we produce in this country; we always have and we will for many years to come, because of the short sheep population that we have now. Mr. STEFAN. You do not anticipate a shortage of wool, then? Mr. DODD. This country is going to have to buy wool from Australia and South America. Mr. STEFAN. There is going to be a domestic shortage? Mr. DODD. There is no question but that large imports will be required. We have always had a shortage of certain types of wools from domestic production. Mr. STEFAN. And we have 238,000,000 pounds of wool, 50 percent of which is not salable in the United States? Mr. DODD. It is not the kind of wool that our clothing manufacturers want to use under present conditions. Mr. STEFAN. In other words, we have the same story as to that wool that we had in connection with the binder twine that was made out of that Mexican weed? Mr. DODD. That is correct. Mr. STEFAN. It was not of good quality and you are looking for a market for it. Mr. DODD. Much of this wool is just as good quality—that is, the 50's to the 58's are just as good quality as any 50's and 58's in the world. Mr. STEFAN. It seems to me that it would be good enough quality for us to give these foreign countries whom it is proposed that we supply with wool, instead of going down into Argentina and buying wool for them. Mr. DODD. It makes pretty good clothes. You and I have worn a whole lot worse. But the market for clothing today in America is such that we are demanding a little bit finer quality. Mr. STEFAN. I am talking about these foreigners who want help from us. Mr. DODD. We will offer it for sale to anybody who will buy it; that is, the Commodity Credit Corporation will. Mr. STEFAN. Why did you not pick it up, Mr. Nitze? Why did you not take that into consideration, in view of the fact that we have 238,000,000 pounds of it on hand in this country? Mr. NITZE. I did not go into that particular question, Mr. Stefan, but my impression was that the market in the United States for equivalent grades is much higher than it was abroad. Mr. STEFAN. Mr. Dodd has just testified that half of the 238,000,000 pounds of wool that they have on hand they cannot get rid of and I suppose he will have to sell it at a loss. Mr. NITZE. I am not sure that it could not be sold domestically at a higher price than we can buy wool abroad. Mr. DODD. I think that is right. I think, when you get onto a competitive basis, you will find that Australia and South America will offer wool of like quality probably for less money than we can offer it, because of the differences that I mentioned. Mr. STEFAN. There must be an explanation for that. Mr. DODD. Well, you have got a 25.5-cent duty on scoured wools. We will always be ahead of the world market, even though our price may be lower than some of our people would like to have it. Mr. KEEFE. There is no provision in this ECA program for the shipment of finished woolen goods; is there? Mr. NITZE. No, sir. Mr. DODD. I believe none at all. Mr. KEEFE. So that the American woolen manufacturer himself is not involved in the ECA program? Mr. DODD. No. Mr. KEEFE. What is involved is the possible purchase of wool for fabrication in plants abroad, in the participating countries? Mr. DODD. Raw materials. Mr. KEEFE. The question was asked me this morning by a Member of Congress, and I thought that was the situation and so advised him, although I could not recall with any definiteness whether there was any actual consideration being given to the shipment of finished woolen goods manufactured by American manufacturers. Mr. STEFAN. I asked that question the other day-whether they were going to have any blankets, and so forth, to ship over-and they told us "no." IMPORTS AND SHIPMENTS OF COTTON Mr. MAHON. Mr. Chairman, I should like to ask one or two questions on cotton. I am referring to table 3, line 14, under column 5, "Imports and shipments," where you have 300,000 bales. What is included in "Imports and shipments"? "Shipments" confuses me. Mr. DODD. "Shipments" means the stuff that we will receive from our own areas, like Puerto Rico or the Virgin Islands. Imports are from all other countries. Mr. MAHON. That is with respect to cotton? Mr. DODD. That is with respect to all commodities. For cotton it means your long-staple cotton from Egypt, and cottons of that kind. Mr. STEFAN. Some from Brazil? Mr. DODD. No. COTTON QUOTAS Mr. MAHON. What restrictions such as quotas do we have on the importation of cotton? Mr. DODD. I would have to look up the present quota to tell you exactly. Mr. MAHON. Can you tell me approximately? Mr. DODD. There is a quota on all cotton. Then there is a quota on certain different staple lengths of cotton. Mr. MAHON. Is that fixed? Mr. DODD. I can get that for you, Mr. Mahon. I sat in on the hearings and agreed to the quota. That was with the Interstate Commerce and the Tariff Commission people. But I cannot give you exact figures on it now. Mr. MAHON. Under what conditions may the quotas vary? Mr. DODD. Demand. You have to look at demand and our own supply of that particular staple length. Mr. MAHON. Would the executive branch have authority to change the quotas? Mr. DODD. No. We have the authority to make a recommendation to the President for a change in the quotas. Mr. MAHON. Does the President have to consult the Congress? Mr. DODD. No; he calls on the Tariff Commission to have a hearing at which all interested parties appear. They make their findings and make their recommendations. Mr. MAHON. Does that come under the reciprocal trade agreements law? Mr. DODD. No; it is under section 22 of the Agricultural Adjustment Act. We also have an import quota on wheat at the present time-800,000 bushels. I do not think we have any quota on longstaple cotton at this time. Our quotas are on short-staple cotton. We do have a quota on the shorter staple cottons. Mr. NITZE. I think there is also a quota on long-staple cotton; is there not? Mr. DODD. There is on certain lengths, but I cannot tell you the exact lengths. Mr. MAHON. Will you insert in the record the specific data with regard to that? Mr. DODD. I can get you the exact ruling as to what the quotas are, and put them in the record at this point. Mr. MAHON. If you will. (The information is as follows:) At the present time the following annual import quotas are in effect with respect to cotton and cotton waste: (1) Less than 4-inch harsh or rough, 70,000,000 pounds; (2) Under 1% inches other than rough or harsh under 4-inch, 14,517,882 pounds; (3) 1% inches or more but less than 11 inches, 45,656,420 pounds; and (4) Cotton card strips made from cotton having a staple of less than 16 inches in length, Comber Waste, Lap Waste, Sliver Waste, and Roving Waste, whether or not manufactured or otherwise advanced in value, 5,482,509 pounds. The import duty on cotton 1% inches and over formerly was 7 cents per pound. The duty now in effect, however, is 31⁄2 cents per pound for cotton 1% inches and over but less than 1116 inches. Mr. STEFAN. Can we get the total annual imports of long-fiber cotton? |