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agement, and other purposes; and such recommendations for amendment of this title as may appear necessary or desirable.

TITLE III-SURPLUS DISPOSAL

MAINTENANCE OF INCREASED SET-ASIDE

SEC. 301. (a) Notwithstanding the provisions of section 102 of the Agricultural Act of 1954, the quantities of wheat and cotton set aside pursuant to section 101 of that Act shall be increased, respectively, by a quantity acquired from 1955 and prior years' crops equal to the quantity by which the carryover of the commodity for the marketing year beginning in 1956 exceeds the carryover of the commodity for the marketing year beginning in 1955.

(b) The last sentence of section 105 of the Agricultural Act of 1954 is amended by striking out "1955" and inserting "1956".

(c) So much of subsection (a) of section 103 of the Agricultural Act of 1954 as precedes paragraph (1) of such subsection is amended to read as follows: "(a) During any marketing year for which the total supply of any commodity in the set-aside (excluding the quantity in the set-aside from the computation of total supply) exceeds per centum of the normal supply for such commodity the commodity set-aside shall be reduced by disposals of such commodity made in accordance with the direction of the President as follows:"

PROGRAM OF ORDERLY LIQUIDATION

SEC. 302. (a) The Secretary of Agriculture shall, as rapidly as possible consistent with the operation of the price support program and orderly liquidation, dispose of all stocks of agricultural commodities held by the Commodity Credit Corporation in excess of those required to provide adequate reserves for current domestic consumption and export and for the national security (hereinafter referred to as "surplus commodities").

(b) The Secretary shall submit a detailed program for the disposition of surplus commodities as required by subsection (a) to Congress within thirty days after the enactment of this Act and shall report annually thereafter on his operations under subsection (a). Such programs and annual reports shall show

(1) the quantities of surplus commodities on hand;

(2) the methods of disposition utilized and the quantities disposed of during the preceding twelve months;

(3) the methods of disposition to be utilized and the estimated quantities that can be disposed of during the succeeding twelve months;

(4) a detailed program for the expansion of markets for surplus agricultural commodities through marketing and utilization research and improvement of marketing facilities; and

(5) recommendations for additional legislation necessary to accomplish the purposes of this section.

REESTABLISHMENT OF HISTORIC SHARE OF WORLD COTTON MARKET

SEC. 303. (a) In furtherance of the current policy of the Commodity Credit Corporation of offering surplus agricultural commodities for sale for export at competitive prices, the Commodity Credit Corporation is directed to use its existing powers and authorities to encourage sales for export of such quantities of cotton as will reestablish and maintain the fair historical share of the world market for United States cotton, said volume to be determined by the Secretary of Agriculture.

(b) In order to prevent material interference with the sales program authorized under subsection (a) or with the cotton price support program or to prevent loss of domestic markets for cotton or reduction in the amount of cotton products produced in the United States from United States cotton, the quantity of manufactured cotton products which may be imported into the United States shall not exceed by more than 50 per centum the average annual quantity imported during a representative period of two consecutive years, as determined by the Secretary of Agriculture: Provided, That not to exceed 25 per centum of such quantity may be entered during any calendar quarter. The Secretary of Agriculture may promulgate such regulations as may be necessary to assure equitable distribution of such quotas among exporting countries.

64440-56-pt. 8- -6

EXTENSION AND EXPANSION OF SPECIAL SCHOOL MILK PROGRAM

SEC. 304. The last sentence of section 201 (c) of the Agricultural Act of 1949, as amended, is amended to read as follows: "For the period September 1, 1954, to June 30, 1955, not to exceed $50,000,000, and for the period July 1, 1955, to June 30, 1957, not to exceed $75,000,000 annually, of the funds of the Commodity Credit Corporation shall be used exclusively to increase the consumption of fluid milk by children in nonprofit schools of high-school grade and under."

EXTENSION OF ACCELERATED BRUCELLOSIS PROGRAM

SEC. 305. Section 204 (e) of the Agricultural Act of 1954, is amended to read as follows: "As a means of stabilizing the dairy industry and further suppressing and eradicating brucellosis in cattle the Secretary of Agriculture is authorized to transfer not to exceed $15,000,000 for each of the fiscal years ending on or before June 30, 1958, from funds available to the Commodity Credit Corporation, to the funds appropriated to the Department of Agriculture for such fiscal years for the purpose of accelerating the brucellosis eradication program, for the purpose of increasing to not to exceed $50 per head of cattle the amount of the indemnities paid by the Federal Government for cattle destroyed because of brucellosis in connection with cooperative control and eradication programs for such disease in cattle entered into by the Secretary under the authority of the Act of May 29, 1884, as amended, for the purpose of increasing the number of such indemnities, and for the purpose of defraying any additional administrative expenses in connection therewith. There are hereby authorized to be appropriated annually such sums as may be necessary to reimburse the Commodity Credit Corporation for expenditures pursuant to this section."

EXTENSION OF VETERANS AND ARMED FORCES MILK PROGRAMS

SEC. 306. Section 202 of the Agricultural Act of 1949 (relating to the Veterans and Armed Forces milk programs) is amended by striking out "December 31, 1956" wherever it appears therein and inserting in lieu thereof "December 31, 1958."

TITLE IX--RICE CERTIFICATE PLAN

SEC. 401. Title III of the Agricultural Adjustment Act of 1938, as amended, is amended (1) by changing the designation thereof to read as follows: "TITLE III-LOANS, PARITY PAYMENTS, CONSUMERS SAFEGUARDS, MARKETING QUOTAS, AND MARKETING CERTIFICATES"; (2) by changing the designation of subtitle D thereof to read as follows: "Subtitle E.-MISCELLANEOUS PROVISIONS AND APPROPRIATIONS"; and (3) by inserting after subtitle C a new subtitle D, as follows:

"SUBTITLE D-RICE MARKETING CERTIFICATES

"LEGISLATIVE FINDINGS

"SEC. 380a. Rice, in addition to being a basic food, is one of the great export crops of American agriculture and its production for domestic consumption and for export is essential to the maintenance of a sound national economy and to the general welfare. The movement of rice from producer to consumer, is preponderantly in interstate and foreign commerce. That small percentage of rice which is produced and consumed within the confines of any State is normally commingled with, and always bears a close and intimate commercial and competitive relationship to, that quantity of such commodity which moves in interstate and foreign commerce. For this reason, any regulation of intrastate commerce in rice is a regulation of commerce which is in competition with, or which otherwise affects, obstructs, or burdens, interstate commerce in that commodity. In order to provide an adequate and balanced flow of rice in interstate and foreign commerce and thereby assists farmers in obtaining parity of income by marketing rice for domestic consumption at parity prices and by increased exports at world prices, and to assure consumers an adequate and steady supply of rice at fair prices, it is necessary to regulate all commerce in rice in the manner provided under the marketing certificate plan set forth in this subtitle.

"PRIMARY MARKET QUOTA

"SEC. 380b. Not later than December 31 of each calendar year the Secretary shall determine and proclaim the primary market quota for rice for the marketing year beginning in the next calendar year. Such quota shall be that number of bushels of rice which the Secretary determines will be consumed as human food in the United States (including its Territories and possessions) or exported to Cuba during such marketing year.

"APPORTION MENT OF PRIMARY MARKET QUOTA

"SEC. 380c. (a) The primary market quota for rice, less a reserve of not to exceed 1 per centum thereof for apportionment as provided in this subsection, shall be apportioned by the Secretary among the several States on the basis of the total production of rice in each State during the five calendar years immediately preceding the calendar year for which the quota is proclaimed (plus, in applicable years, the acreage diverted under previous agricultural adjustment and conservation programs), with adjustments for trends in acreage during the applicable period. The reserve quota set aside herein for apportionment by the Secretary shall be apportioned to farms receiving quotas which are inadequate because of an insufficient State or county quota or because rice was not produced on the farm during all of the preceding five years.

"(b) The State quota shall be apportioned to farms owned or operated by persons who have produced rice in any one of the five calendar years immediately preceding the year for which such apportionment is made on the basis of past production of rice in the State by the producer on the farm taking into consideration the acreage allotments and quotas previously established in the State for such owners or operators; abnormal conditions affecting production; land, labor, and equipment available for the production of rice; crop rotation practices; and the soil and other physical factors affecting the production of rice: Provided, That if the State committee recommends such action and the Secretary determines that such action will facilitate the effective administration of the Act, he may provide for the apportionment of the State quota to farms on which rice has been produced during any one of such period of years on the basis of the foregoing factors, using past production of rice on the farm and the acreage allotments and quotas previously established for the farm in lieu of past production of rice by the producer and the acreage allotments and quotas previously established for such owners or operators. Not more than 3 per centum of the State quota shall be apportioned among farms operated by persons who will produce rice during the calendar year for which the allotment is made but who have not produced rice in any one of the past five years, on the basis of the applicable apportionment factors set forth herein: Provided, That in any State in which quotas are established for farms on the basis of past production of rice on the farm such percentage of the State quota shall be apportioned among the farms on which rice is to be planted during the calendar year for which the apportionment is made but on which rice was not planted during any of the past five years, on the basis of the applicable apportionment factors set forth herein.

"(c) Notwithstanding any other provisions of this Act-

"(1) if farm quotas are established by using past production of rice on the farm and the acreage allotments and quotas previously established for the farm in lieu of past production of rice by the producer and the acreage allotments and quotas previously established for owners or operators, the State quota shall be apportioned among counties in the State on the same basis as the national quota is apportioned among the States and the county quotas shall be apportioned to farms on the basis of the applicable factors set forth in subsection (b) of this section: Provided, That the State committee may reserve not to exceed 5 per centum of the State quota, which shall be used to make adjustments in county quotas for trends in acreage and for abnormal conditions affecting plantings; and

"(2) In determining the past production of rice by producers on a farm, the production of rice on the farm for any year for which farm acreage allotments or quotas were in effect shall be divided among the producers thereon in the proportion in which they contributed to the farm acreage allotment or quota.

"(d) Notwithstanding any other provision of this section, no amount of rice produced on any farm in excess of the quota for such farm shall be taken into account in establishing future State, county, and farm quotas.

"(e) In any case in which, during any year for which a primary market quota is in effect under this title, the production of rice on any farm is less than the quota for such farm, there shall be considered for the purposes of future farm, county, and State quotas to have been produced on such farm in such year an amount of rice equal to the quota of such farm, but only if the owner or operator of such farm notifies the county committee prior to June 20 of such year of his desire to preserve such quota.

"MARKETING CERTIFICATES

"SEC. 380d. (a) The Secretary shall issue marketing certificates to cooperators for the amount produced within the quota established for the farm pursuant to the applicable provisions of section 380c of this Act. The Secretary may require such certification by the producer on the face of the certificate or otherwise with respect to the amount produced by him as may be necessary to determine the value of the certificate. The Secretary may authorize the issuance of such certificates to individual producers on any farm on the basis of their respective shares in that part of the rice crop, or the proceeds thereof, produced on the farm which is within the quota for the farm. The Secretary shall also issue and sell marketing certificates in such quantities as may be required to persons processing rice into food products or importing rice food products. Marketing certificates shall be transferable only in accordance with regulations issued by the Secretary.

"(b) Whenever a primary market quota is proclaimed for any marketing year pursuant to section 380b of this Act, the Secretary shall determine and proclaim for such marketing year (1) the estimated parity price and the estimated farm price for rice, and (2) the value of the marketing certificate. The value of the marketing certificate shall be equal to the amount by which the estimated parity price exceeds the estimated farm price as determined herein. The value of the marketing certificate shall be computed to the nearest cent. The proclamation required by this subsection shall be made during the month of July immediately preceding the marketing year for which such quota is proclaimed.

"(c) The Secretary is authorized and directed through the Commodity Credit Corporation to buy and sell marketing certificates issued for any marketing year at the value proclaimed pursuant to subsection (b) of this section. Certificates shall be valid to cover sales and importations of products made during the marketing year with respect to which they are issued and after being once used to cover such sales and importations shall be canceled by the Secretary. Any unused certificates shall be redeemed by the Secretary at the price established for such certificates.

"MARKETING RESTRICTIONS

"SEC. 380e. (a) Except as provided in subsection (d) hereof, no person engaged in the processing of rice into food products composed wholly or partly of rice shall market for domestic food consumption or export any such product produced by him containing rice in excess of the quantity for which marketing certificates issued pursuant to section 380 of this Act have been acquired by such person.

"(b) Except as provided in subsection (d) hereof, no person, shall import or bring into the continental United States any food product containing rice in excess of the quantity for which marketing certificates issued pursuant to section 380d of this Act have been acquired by such person.

"(c) Upon the exportation from the continental United States to any country other than Cuba of any food product processed from rice, with respect to which marketing certificates as required herein have been acquired, the Secretary shall pay to the exporter an amount equal to the value of the certificates for the quantity of rice equivalent so exported. For the purposes of this subsection, the consignor named in the bill of lading, under which the article is exported, shall be considered the exporter: Provided, however, That any other person may be considered to be the exporter if the consignor named in the bill of lading waives claim in favor of such other person.

"(d) Upon the giving of a bond satisfactory to the Secretary under such rules and regulations as he shall prescribe to secure the purchase of and payment for

such marketing certificates as may be required, any person required to have a marketing certificate in order to market or import a food product processed wholly or partly from rice may market or import any such food product without having first acquired a marketing certificate.

"(e) As used in this section, the term 'market' means the sale and the delivery of the food product composed wholly or partly of rice.

"CONVERSION FACTORS

"SEC. 380f. The Secretary shall ascertain and establish conversion factors showing the amount of rice contained in food products processed wholly or partly from rice. The conversion factor for any such product shall be determined upon the basis of the weight of rice used in the processing of such product.

"CIVIL PENALTIES

"SEC. 380g. Any person who violates or attempts to violate, or who participates or aids in the violation of, any of the provisions of subsection (a) or (b) of section 380e of this Act shall forfeit to the United States a sum equal to three times the market value, at the time of the commission of such act, of the product involved in such violation. Such forfeiture shall be recoverable in a civil suit brought in the name of the United States.

"REPORTS AND RECORDS

"SEC. 380i. (a) The provisions of section 373 of this Act shall apply to all persons, except rice producers, who are subject to the provisions of this subtitle, except that any such person failing to make any report or keep any record as required by this section or making any false report or record shall be deemed guilty of a misdeameanor and upon conviction thereof shall be subject to a fine of not more than $2,000 for each such violation.

"(b) The provisions of section 373 (b) of the Act shall apply to all rice farmers who are subject to the provisions of this subtitle.

"REFERENDUM

"SEC. 380j. In the first referendum held pursuant to section 354 of this Act after the enactment of this section, the Secretary shall also submit the question whether farmers favor a marketing certificate program under this subtitle in lieu of marketing quotas under subtitle B. If more than one-half of the farmers voting in the referendum favor such marketing certificate program, the Secretary shall, prior to the effective date of the national marketing quota proclaimed under subtitle B, suspend the operation of such quota and a marketing certificate program shall be in effect under the provisions of this subtitle. Price crops produced subsequent to the date of such suspension shall be subject to acreage allotments but not marketing quotas under subtitle B.

"PRICE SUPPORT

"SEC. 380k. Notwithstanding any other provision of law—

"(a) Whenever a rice marketing certificate program under this subtitle is in effect, price support for rice shall be determined in accordance with the provisions of this section.

"(b) The Secretary of Agriculture is authorized to make available through loans, purchases, or other operations, price support to producers of rice who are cooperators. The amount, terms, conditions, and extent of such pricesupport operations shall be determined by the Secretary, except that the level of such support shall be determined after taking into consideration the following factors: (1) the supply of the commodity in relation to the demand therefor, (2) foreign trade policies of friendly rice exporting countries, and (3) other factors affecting international trade in rice including exchange rates and currency regulations.

"(c) Compliance by the producer with production goals, and marketing practices (excluding marketing quotas) may be prescribed and required by the Secretary as additional conditions of eligibility for price support and for the receipt of marketing certificates.

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