competing elevators, which convinced me that we still were not able to give our exporters as liberal mix as they and others were getting elsewhere. I wish to strongly emphasize that although the city of Galveston owns and operates the largest export grain elevator in the United States (a 6-million-bushel house) and that our grain elevator is one of the fastest and most efficiently operated elevators in this country, we have been losing ground relatively in the handling of export grain as compared with the volume of grain being handled at other nearby competing elevators; and that, unless something is done by the Department of Agriculture to correct and remove this discrimination about which we have been complaining for almost 4 years, we may be faced with the possibility of having to close the largest and most efficient port grain elevator in this country, because, as I have stated before, the private grain exporters will seek to use those port elevators in this area that are willing and able, due to lack of continued close Federal supervision similar to that imposed on our elevator, to give the private grain exporters a most liberal mix on the delivery of their grain to vessels. These private exporters will stop using our elevator because we are so tightly Federal supervised by the Department of Agriculture Federal Supervisory Division. This would be a severe blow to Galveston because shipping is its very lifeblood. Take our shipping away and you destroy the city. MEMO FROM WASHINGTON OFFICE, GALVESTON WHARVES, May 7, 1952 To: Mr. E. H. Thornton, vice chairman and general manager. Subject: Grain Inspection Service. DEAR MR. THORNTON: I dropped by Department of Agriculture yesterday and had a very nice visit with our friend Mr. Murphy, Chief of the Federal Grain Inspection Service. Mr. Murphy agreed that he has not yet said anyting to Mr. Funchess about having one of his supervisors out of the Galveston office keep a "closer eye" out on Houston, but said he believes something can be worked out along this line a little later this year. He also agreed with me, as he agreed with you, that we had a lot closer supervision at Galveston than exists in Houston at the present time. As to his office being able to establish grain inspection stations at Houston, Amarillo, and Kansas City, which they had tentatively set up in their requirements as outlined to Congress, Mr. Murphy said they finally had to give up this idea, and he feels they were lucky to hold on to what they have in view of the moves for economy, and more particularly, in view of the fire under which the Department of Agriculture now is before the various congressional committees. He said they plan again to ask for these three offices at the next "go around" but of course he does not know what their chances will be at this time. Various interests at Amarillo and Kansas City have supported Agriculture in this request but as we might assume, Houston has made no indication that they desire such an office. Sincerely yours, RAN. Mr. R. A. NESBITT, GEA, Washington, D. C. GALVESTON WHARVES, May 1, 1952. DEAR BOB: I suggest that you make an appointment to see our mutual friend, Mr. Murphy, head of the Federal Grain Inspection Service, and remind him that he apparently has not said anything to Mr. Funchess about keeping one of his supervisors in Houston more regularly. It doesn't seem fair that the Houston Port elevators should be allowed to load ships without Federal supervision while very close Federal supervision is imposed upon vessels loading at our elevators. Very truly yours, E. H. THORNTON, 34117-53-pt. 2-16 Mr. F. J. HERBELIN, GALVESTON WHARVES, March 1, 1952. Galveston Cotton Exchange and Board of Trade, Galveston, Tex. DEAR FRANCIS: For you information beg to enclose letter dated the 26th ult. received from Mr. E. J. Murphy, Deputy Director, USDA-P&MA, Grain Branch, Washington, which is in reply to my letter to him of February 14. Yours very truly, E. H. THORNTON. UNITED STATES DEPARTMENT OF AGRICULTURE, Mr. F. J. HERBELIN, Galveston Cotton Exchange and Board of Trade, Galveston, Tex. DEAR MR. HERBELIN: We received your letter of February 11 with reference to establishing grain supervision offices at Texas gulf ports. This matter has received consideration by the Department in previous years. Specific attention was given to the possibility of increasing supervision facilities at the port_of Houston. So far, however, funds have not been available for this purpose. We are endeavoring to carry on as best we can by attempting to give all Texas gulf ports as much supervision from the Galveston office as personnel, equipment, and funds will permit. Very truly yours, E. J. MURPHY, Deputy Director. UNITED STATES DEPARTMENT OF AGRICULTURE, Mr. E. H. THORNTON, Washington 25, D. C., February 26, 1952. Galveston Wharves, Galveston, Tex. DEAR MR. THORNTON: We received your letter of February 14 stating that you would like to discuss the matter of the Department establishing grain supervision offices at other Texas gulf ports, when you are in Washington during the week of March 31. We have since received a copy of your letter of February 18 to Mr. W. F. Funchess regarding this matter. This matter has received attention of the Department in the past because we recognize fully the need and desirablity of adequate supervision at all important receiving and export markets. We shall look forward with interest to seeing you. Yours very truly, E. J. MURPHY, Deputy Director. GALVESTON WHARVES, February 18, 1952. Mr. W. F. FUNCHESS, Marketing Specialist, Production and Marketing Administration, Grain Branch, Galveston, Tex. DEAR MR. FUNCHESS: I find that I failed to furnish you with a copy of my letter of February 14 addressed to Mr. Murphy on the subject of placing resident Federal grain supervisors at Houston and perhaps at other Texas ports where Federal grain supervisors are not now located. Last week when I discussed this subject with you I told you that we were very much concerned over the lack of closer Federal supervision at these other competing port elevators, but that I was not complaining about the close Federal supervision that is now being imposed at our elevator B, and think that this discrimination against our elevator should be removed at the earliest date possible. Yours very truly, E. H. THORNTON. Mr. E. J. MURPHY, GALVESTON WHARVES, February 14, 1952. Deputy Director, Regulatory and Inspection Division, Grain Branch, United States Department of Agriculture, Washington, D. C. DEAR MR. MURPHY: We have copy of letter dated the 11th inst. addressed to you by Mr. F. J. Herbelin, chairman of the grain committee of the Galveston Cotton Exchange and Board of Trade, on the subject of your Department establishing resident grain supervisors at other Texas gulf ports. This is an important subject to us and I would like to personally discuss this matter with you when I am in Washington during the week beginning March 31. I will phone you for an engagement after I reach Washington. With kindest regards, beg to remain, Yours very truly, E. H. THORNTON. GALVESTON COTTON EXCHANGE AND BOARD OF TRADE, Mr. E. J. MURPHY, Deputy Director, Regulatory and Inspection Division, DEAR MR. MURPHY: We understand that some years ago your Department was actively considering the establishment of resident Federal grain supervisors in other Texas gulf ports. We believe that as a matter of public policy such offices should be established and hope you can see your way clear to do so at an early date. Yours very truly, Mr. W. F. FUNCHESS, F. J. HERBELIN, Chairman, Grain Committee. GALVESTON WHARVES, October 11, 1949. Grain Inspection Supervisor, In Charge, Grain Branch, Production and Marketing Administration, Galveston, Tex. Dear Mr. FuNCHESS: Beg to acknowledge receipt and thank you for yours of the 3d inst. We sincerely hope that Messrs. English and Barr will take prompt action on our request to correct the existing discrimination against our elevator B. Just today, we had one large export grain concern, who has been doing business with the Galveston Wharves' elevator B for more than 30 years, to notify us that they will have to discontinue trying to do any export grain business through our elevator B as they cannot continue using our elevator B and meet the competition of other grain exporters who are shipping bulk grain through other port elevators where the Government supervision is not so strict as at elevator B. We stand a chance of losing most, if not all, of our private export grain business unless something is done quickly to remove this discrimination against our elevator B. Yours very truly, Mr. LEROY K. SMITH, E. H. THORNTON, Vice Chairman and General Manager. GALVESTON WHARVES, October 5, 1949. Director, Grain Branch, Production and Marketing Administration, DEAR MR. SMITH: Supplementing my letter to you of the 28th_ult., beg to enclose herewith copy of my letter of October 1 addressed to Mr. W. F. Funchess, Chief Grain Inspection Supervisor for the Department of Agriculture, headquarters at Galveston, and a copy of Mr. Funchess' acknowledgment and reply thereto dated October 3, both of which are self-explanatory. Again assuring you of our full cooperation in the storing and handling of Government grain at our elevator B, beg to remain, Yours very truly, E. H. THORNTON. UNITED STATES DEPARTMENT OF AGRICULTURE, Mr. E. H. THORNTON, Galveston Wharves, Galveston, Tex. DEAR MR. THORNTON: We have your letter of October 1, in regard to the relative amount of supervision of the inspection of grain cargoes loaded at Galveston, Houston, and Port Arthur, as performed by our Galveston office. On September 1, I reported to Mr. English and to Mr. Barr the substance of our conversation referred to in the first paragraph of your letter to me of October 1. On September 6, Mr. English wrote me a memorandum in which he stated we must arrange somehow to give more official supervision to cargo loadings at Houston and Port Arthur. This we are endeavoring to do. However, as I told you, we are handicapped by our limited number of personnel and the amount of funds available to us for travel purposes. We are mailing a copy of your letter to me of October 1, together with copies of all the correspondence enclosed therein, to both Mr. Barr and Mr. English. If they think it advisable to write to you directly, they will, of course, do so. Yours very truly, W. F. FUNCHESS, Grain Inspection Supervisor in Charge, Grain Branch. Mr. W. F. FUNCHESS, GALVESTON WHARVES, October 1, 1949. Grain Supervisor in Charge, Grain Branch, Production, and Marketing Administration, Galveston, Tex. DEAR MR. FUNCHESS: Recalling conversation that I had with you several weeks past at which time I verbally complained to you of the discrimination against the Galveston Wharves elevator B and the preference extended to other competing port elevators in this area in the matter of Government supervision over inspection of grain delivered from the wharves elevator B and other port elevators in this area to onboard vessels. You conceded that we had just cause of complaint of discrimination due to the fact that you and your Department were imposing strict supervision over the inspection of grain delivered from our elevator B to onboard vessels berthed thereat whereas the same close Government supervision was not being imposed over the inspection of grain delivered from other port elevators in this area to onboard vessels berthed at said other elevators and you promised to write your Mr. English at Chicago and also I believe Mr. Barr at Washington placing before these two gentlemen our complaint of discrimination and our request that this discrimination be removed by the Government establishing and imposing the same strict supervision over the inspection of grain delivered aboard vessels at these other port elevators which are competitors of our elevator B. I was wondering if you had heard anything from Mr. English or Mr. Barr and if any steps have been taken to remove this discrimination against our elevator B of which we are complaining. For your further information, I beg to enclose herewith copy of telegram dated the 27th ult. that we received from Mr. Leroy K. Smith, Director of the Grain Branch of the Production and Marketing Administration, Washington, D. C., and a copy of my letter of the 28th addressed to Mr. Smith in reply to this telegram. This will give you some idea of what we are faced with in our efforts to compete with other port elevators in this area in the handling of Government grain, when our elevator B is being supervised by your Department while these other competing port elevators are not being so closely supervised by your Department in the inspection of grain delivered therefrom aboard vessels. Would appreciate your again taking this matter up with Mr. English and Mr. Barr and urge that they take steps to remove this discrimination existing against our elevator B. I repeat here what I told you personally, we are not making any claim that you or your Department is not doing its full duty in the imposing of strict supervision over the inspection of grain delivered from our elevator to vessels, and we are not asking that you or your Department relax this supervision at our elevator but we are asking that you and your Department impose the same strict Government supervision at other port elevators in this area. Thanking you in advance for your prompt attention to this matter and awaiting to hear from you, beg to remain, Yours very truly, E. H. THORNton. Mr. LEROY K. SMITH, Director, Grain Branch, PMA, GALVESTON WHARVES, September 28, 1949. United States Department of Agriculture, Washington 25, D. C. DEAR MR. SMITH: Reference to your telegram of today as well as our telephone conversation concerning contents therein pertaining to the handling and loading of bulk grain for the Commodity Credit Corporation by port elevator located on the gulf. I beg to confirm my statement to you over the telephone that we are not in a position to agree to your proposed directive which would require us to unload and remove any bulk grain from vessels berthed at our elevator; it follows that we could not agree to assume any expense that might be incurred in removing any Commodity Credit Corporation bulk grain from vessels berthed at our elevator; nor could we agree to assume any ship demurrage charges that might be incurred on any vessel because of delay in taking on grain at our elevator. On the other hand, we do agree that on all Commodity Credit Corporation grain, which we hereafter handle at our elevator B, to exert every effort and to take every precaution to see that the proper authorized class and grade of Commodity Credit Corporation grain is delivered by our elevator to vessels berthed thereat. I wish to confirm what I told you over the phone, that we have set aside at our elevator B, for the exclusive handling of Government grain, a minimum of 21⁄2 million-bushel bin storage space. As stated, this space has been allocated for the exclusive use and solely for the handling of Government grain, and that no private grain will be permitted to be stored or binned in this "Government bin space." We are also taking steps to have grain samplers employed by the local board of trade to take samples of outbound Government grain at the shipping or mixing bins in our elevator B until such time as we can purchase and install a sufficient number of automatic grain sampling machines in our elevator. As soon as these samples are taken we will rush same to the official grain inspector located in an adjacent building and have the grain graded immediately We will hold up delivering the grain to the vessel awaiting a report from the official board of trade grain inspector. This, of course, will result in slowing down the delivery of Government grain from our elevator to vessels berthed thereat, however, I am persuaded to believe that this delay to vessels receiving grain at our elevator will not be serious enough to be of undue concern to the Commodity Credit Corporation or to the vessel operators. We feel confident that we will be able to continue to give these vessels, loading at our elevator, reasonable prompt dispatch under the foregoing arrangement. It is also our intention to run those bins now containing Commodity Credit grain, taking samples of such grain as the bins are run to determine the present condition and grade of said grain. As I explained to you over the telephone, I recently made a strong verbal complaint to the resident Government chief grain inspector about the close Government supervision that has heretofore and is now being imposed upon grain delivered from our elevator to vessels and the lack of the same close Govern" ent supervision on grain delivered from other gulf port elevators to vessels; that we insisted upon this discrimination against our elevator being removed by the Government imposing the same close Government supervision over grain delivered from these other port elevators to vessels as the Government is now imposing on grain delivered from our elevator to vessels. This local Government chief inspector admitted that we had a just cause to complain of discrimination against our elevator "B" and he told me that he intended to report my complaint to Mr. English at Chicago and Mr. Barr at Washington and to recommend to these gentlemen that he be given additional personnel to enable him to establish and impose the same close Government supervision over grain delivered from these other competing elevators to onboard vessels as he is now imposing on grain delivered from our elevator "B" to onboard vessels. |