interest of the United States, in the present critical world situation and knowing that a few years ago the Government was taking from 40 to 80 percent of the United States rice production for its own needs, that it has only been 26 months since export controls went off-the last of the crops to go off-it might well be deemed in the interest of the United States Government to maintain some kind of a reserve.

On the other hand, it might be that we should continue a program of moving it into world markets, at any available opportunity so long as we don't interfere with our normal marketing procedures or requirements.

The CHAIRMAN. I realize that, but the point that I am raising is whether or not this rice would keep.

In other words, if you lock it up and do not permit the Government to sell it, why the weevils might take care of it.

Mr. BLAIR. Yes. I believe, Senator, it is my information and I am serving on CCC's advisory committee, that they are having very little trouble with maintaining the quality of this rice. Probably a fraction of 1 percent that has gone out of condition in the 2 years that they have had some of it in storage.

The CHAIRMAN. That is 2 years. If you take and leave it in there. 2 more years something may happen to it.

Mr. BLAIR. We haven't had that experience so we don't know what the answer might be on that.

The CHAIRMAN. I imagine that is one of the things that may have to be worked out. It would be possible to have some gadget in the law so that the Government could make an exchange of fresh rice for the old.

So you folks might consider that, too.

Mr. BLAIR. I want to say that we recognize it as a very serious problem. I am sure that no member of the committee is going to suggest that CCC acquire it and hold onto it forever with no plans for disposing of it or trying to take care of it and that sort of thing. The CHAIRMAN. It may be we could hold rice for some time but let it be exchanged for fresh rice.

Mr. BLAIR. Yes.

The CHAIRMAN. Replenish it. I would suggest that your committee get together and try to work that out.

Mr. BLAIR. We will do that.

The CHAIRMAN. That is one thing that may act as a deterrent to some of the folks going along with you.

Mr. BLAIR. Yes, sir; we shall certainly do that, and soon.

The CHAIRMAN. In respect to the amount of rice to be planted each year, I notice you have a minimum and maximum.

Mr. BLAIR. Yes, sir.

The CHAIRMAN. How does the minimum compare with what you now are planting?

Mr. BLAIR. The minimum figure, again, is a point that we have not decided, but somewhere around what we are authorized to plant this year.

The CHAIRMAN. As a minimum?

Mr. BLAIR. As a minimum.

The CHAIRMAN. What would be your maximum?

Mr. BLAIR. That is another figure. If I had to give a personal opinion now, not speaking for the committee, USDA in House Docu

ment 100, a study prepared for Congress, said, under this kind of a program we should be able to sell the production from 2,359,000

acres.

This year in the findings with respect to normal supply and acreage allotments published in the January 5 Federal Register, the USDA determined the normal supply of rice to be approximately 56 million hundredweight, which, at 2,400 pounds per acre, represents a production from 2,333,000 acres.

Senator HICKENLOOPER. What are those figures again?

The CHAIRMAN. You mean bushels? Will you repeat that?

Mr. BLAIR. 56 million hundredweight was determined as the normal supply, for the crop year beginning August 1, 1956. Based on approximately average production, that figures about 2,333,000 acres. The CHAIRMAN. How does your maximum campare with the most acreage that was ever planted to rice in this country?

The CHAIRMAN. Any questions, Senator?

Senator HICKENLOOPER. I would like to clear this up with Mr. Blair: Your item 5:

Rice moving into the primary market would obtain a price of not less than 90 percent of parity with the use of negotiable certificates issued to producers for a fixed amount representing the difference between the support level determined by the Secretary and not less than 90 percent of parity.

That is in the nature of the production payment program.

In other words, do you expect this normal supply, or the calculated normal supply of rice to move into the market freely and seek its own level of price?

Mr. BLAIR. Yes.

Senator HICKENLOOPER. And then supplement the difference between the market price and 90 percent of parity?

Mr. BLAIR. We would anticipate that tthe Secretary of Agriculture would determine what quantity of rice could move at a certain level of parity, all of the rice, not just one portion of it, but all of the rice produced under acreage allotment, or how many acres it would take to produce an amount of rice that could move at a certain level of parity.

At that point, determined by the Secretary, all of the rice would be supported. On that portion of production which moved in the domestic market, a certificate would be issued to the producer, a negotiable certificate, entitling him to the difference between whatever level was determined by the Secretary and whatever was determined as the top level for the domestic market.

Does that answer your question sir?

Senator HICKENLOOPER. Yes.

The CHAIRMAN. I heard you state a moment ago that a person who buys this rice would have to obtain a certificate. That is for what is used domestically?

Mr. BLAIR. Yes.

The CHAIRMAN. Both produced domestically and what may be imported. Did I understand you to say that?

Mr. BLAIR. Assuming we have importers who want to bring it into the domestic market.

The CHAIRMAN. Well, now, suppose you do have importers coming in with it, do you envision that the dealer could buy it much cheaper than that locally produced?

Mr. BLAIR. No; I don't envision that he could. But since there might be that possibility, we took care to include them in our suggestion.

The CHAIRMAN. Why put him in there? Why should you permit the person who buys the rice from an importer to use it domestically? Why do you not let the importer take a chance upon the world market, the same as the extra rice?

Mr. BLAIR. We were referring there to the rice which someone might bring in from some foreign country into the United States and if he was not required to pay the same kind of a charge or purchase the same kind of a certificate that a domestic processor was required to purchase, then he might be able to bring it in almost certainly at a lower price in this high-level market in the United States.

The CHAIRMAN. Yes, but the man who buys it for consumption, though, as I understand it, must have a certificate for that which is consumed domestically.

Mr. BLAIR. Our thinking was that the certificate would be required to be purchased by whoever was the first seller to sell it into a domestic market outlet.

The CHAIRMAN. Let us take a specific case. You are a farmer; I am a rice purchaser.

Assuming that you as a farmer will be paid 50 percent of your production, at 90 percent of parity, what would happen is that in order for me to be able to sell 50 percent of your rice, I'd have to get from you a certificate for that amount, would I not?

Mr. BLAIR. You would have, in order to sell it into the domestic market, you would have to get a certificate.

The CHAIRMAN. Yes.

Mr. BLAIR. We would, I think, try to eliminate the provision that as a farmer I must sell it to you.

The CHAIRMAN. I know; you would get the certificate from the farmer who has the rice. They would not be accepted except to a rice#grower, would they?

Mr. BLAIR. We are getting into some details. I think we are clear enough on this. There would be two certificates. One is that certificate, a negotiable certificate which is issued to the producer representing this difference of payment. That would be his, when he is in compliance; whenever he is qualified he gets it. It is negotiable. He can do whatever he wants to with it. He will probably cash it because it is worth so many dollars and cents.

The second certificate

The CHAIRMAN. You did not talk of the second certificate.

Mr. BLAIR. I am sorry. The second one would be that which the first processor or seller is required to purchase from the United States Treasury, probably, for all rice which he sells in the primary market and that, too, represents the difference between whatever the across

the-board support level is and the fixed level in the domestic market, so making him sell in the domestic market on the same basis as the support level which the farmer is getting.

The CHAIRMAN. Suppose your price on the local level fluctuates from the time you get the certificate until you sell it. What happens then?

Mr. BLAIR. That is one of those things that always happens. If it goes up and down a little bit

The CHAIRMAN. If it goes up?

Mr. BLAIR. To the producer it means that, say, we had a level of 60 percent or 65 percent-the figure does not make any differenceof parity the producer has the option of selling his rice to the processor at that figure or putting it in commodity credit at that figure. We assume that the Secretary of Agriculture has determined that figure at a low enough level that rice produced will sell.

Senator HICKENLOOPER. I think we could take some figure, some concrete examples-concrete bushels of rice and what the producer would get on that and what the first seller would get.

The CHAIRMAN. Suppose you give us an illustration.

Senator HICKENLOOPER. Suppose you are a farmer and 5,000 bushels of rice.

The CHAIRMAN. Show us how this would work. Make yourself a farmer. And Henry Chalkley out there is a big rice miller.

Mr. BLAIR. You will hear from some of them, if you want to hear from them as they figure it might be a good opportunity to hear from them.

The CHAIRMAN. Just so long as we get it in the record some way, because some of us will have to explain the bill, and I would like to be specific and learn how it would work.

Mr. BLAIR. May I suggest then if there are no more questions on this, in order to conserve a little time, and hear other ideas along with that, that we hear from some of those.

The CHAIRMAN. All right. You sit there.

Mr. Alioto, will you come up here and see if you can tell us.

STATEMENT OF JOSEPH L. ALIOTO, RICE GROWERS ASSOCIATION OF CALIFORNIA, SAN FRANCISCO, CALIF.

Mr. ALIOTO. I am Joseph L. Alioto. I am here representing the Rice Growers Association of California. My address is 111 Sutter Street in San Francisco, Calif.

The Rice Growers Association is a cooperative marketing association with more than 1,300 grower-members in California, and this cooperative produces and distributes approximately 50 percent of the California crop.

We had a statement that we were going to file with the committee, Senator, but we have come so close to agreeing even on the details of this domestic parity support plan that I would like to postpone the submission for 2 days, because I think in that period of time we are going to have agreement even on the minute details of the plan we are speaking of.

The CHAIRMAN. You would not want to appear again before the committee?

Mr. ALIOTO. No.

The CHAIRMAN. We are going to close the hearings today on this bill, and whatever you have to offer would be in the nature of a memorandum?

Mr. ALIOTO. That is correct.

The CHAIRMAN. And a possible form of bill?

Mr. ALIOTO. Yes. I think it will be a memorandum that the entire industry can agree upon. That is why I am suggesting the slight delay in submitting it.

The CHAIRMAN. I do hope that you can give us that not later than Thursday.

Mr. ALIOTO. I think we will be able to.
The CHAIRMAN. Thursday morning?

Mr. ALIOTO. I feel confident we can.

(The statement referred to above is as follows:)

The enclosed proposed plan for rice is respectfully submitted by the Rice Program Development Committee of Arkansas, Louisiana, Texas, California, and Mississippi. This committee is composed of the following persons:

Joseph L. Alioto, Rice Growers Association of California, 111 Sutter Street, San Francisco, Calif.

Winston Atteberry, Louisiana Rice Growers, Inc., Crowley, La.

George B. Blair, American Rice Growers, Cooperative Association, Post Office Box 877, Lake Charles, La.

George W. Brewer, Rice Growers' Association of California, Sacramento, Calif. L. C. Carter, The Arkansas Rice Growers Cooperative Association, Post Office Box 681, Stuttgart, Ark.

H. G. Chalkley, Post Office Box 558, Lake Charles, La.

J. F. Collier, American Rice Growers Cooperative Association, Houston division, Post Office Box 257, Pearland, Tex.

Joe R. Dockery, Cleveland, Miss.

J. P. Gaines, The Rice Millers' Association, 1308 National Bank of Commerce Building, New Orleans 12, La.

Rex Kimbriel, Cleveland, Miss.

Marshall E. Leahy, Farmers' Rice Growers Cooperative, suite 1258, Russ Building, San Francisco, Calif.

M. W. Mauritz, Ganado, Tex.

W. M. Reid, the Rice Millers' Association, 1308 National Bank of Commerce Building, New Orleans 12, La.

C. N. Spicer, 408 East Seventh Street, Stuttgart, Ark.

PROPOSED FLEXIBLE DOMESTIC SUPPORT PLAN FOR RICE

This program should be in effect for the 1956 plantings and, therefore, should be embodied in a separate bill.

I. Annually the Secretary of Agriculture shall prescribe a national rice acreage allotment of not less than 1,750,000 acres, and not more than 2,359,000 acres, except that for the year 1956 the minimum shall be 1,639,084 acres or the final 1956 acreage allotment, whichever is greater.

(a) The national rice acreage allotment shall be apportioned to the States in which rice is produced. For the year 1956 it shall be apportioned to the States in precisely the same manner as it has already been apportioned in connection with the acreage allotments already proclaimed by the Secretary. The national acreage allotment for rice for each calender year after 1956 shall be apportioned by the Secretary among the several States in which rice is produced in proportion to the average number of acres of rice in each State during the 3-year period immediately preceding the calendar year for which such national acreage allotment of rice is determined, plus, in applicable years, the acreage diverted under any national agricultural program; provided, however, that in no event shall any year prior to 1955 be used in such determination, and provided further, that if 3 years commencing in 1955 shall not have elapsed to permit such a determination, then the apportionment shall be on the basis of the average number of acres of rice in each State in the years beginning in 1955.

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