Mr. CORTRIGHT. In units of production.

The CHAIRMAN. That is right. If you don't cover that in your brief, I would certainly like to have your reaction on it.

Mr. CORTRIGHT. My reaction will entirely be my own.

Senator THYE. I would like to ascertain whether there has been an increase in the use of commercial fertilizers.

Mr. CORTRIGHT. In the use of them?

Senator THYE. Yes.

Mr. CORTRIGHT. Speaking only for my area I would say the rate in the last 5 years has been doubled, the rate per acre.

Senator THYE. The rate per acre has doubled in your area, and you think it would be the same in other areas?

Mr. CORTRIGHT. Yes.

Senator THYE. Has there been much irrigation in your area? We know in California, for instance, and out in that general area there have been irrigation projects that brought cotton into production.

Mr. CORTRIGHT. Percentagewise very little. There is a very great interest, surveys are constantly underway to see the feasibility of it and I would say we can expect more irrigation in the valley States. Senator THYE. Has there been any narrowing of the rows? Mr. CORTRIGHT. No, sir.

Senator THYE. Can it be done?

Mr. CORTRIGHT. We find that on our present spacings our yields from the experiment stations are just as good as they would be on any

narrower row.

Senator THYE. Can you use more fertilizer and get an increase in production?

Mr. CORTRIGHT. More than we are now using is hardly indicated. Senator THYE. Thank you.

Mr. CORTRIGHT. Mr. Chairman, I think your proposal certainly has much merit to it, that if we are going to control total production we are going to have to control it in the sense of units instead of in acres. I believe there is much merit to your proposal as an individual. The CHAIRMAN. It is not my proposal.

Mr. CORTRIGHT. I believe it deserves serious study on all commodities.

The CHAIRMAN. Now, have you given thought as to how it could be done?

Mr. CORTRIGHT. The mechanics of it I think would be most difficult. The CHAIRMAN. Would you suggest that the acreage controls be lifted and simply let a farmer plant all the cotton he wants and market so much of it? Would that be the way you would want to do it?

Mr. CORTRIGHT. I don't think you could lift your acreage controls. I think you could establish marketing quotas and previous production and give him certain marketing quotas but I believe still you should keep your acreage controls in.

The CHAIRMAN. You would want both?

Mr. CORTRIGHT. If he overproduces abundantly his marketing quota is going to create enormous difficulties in the farm population instead of if his production is pretty well in balance. If you turn a farmer loose he is going to produce.

The CHAIRMAN. I was hoping he wouldn't. Particularly when the Government is trying to assist him and where the Government is

saying to him, "We are going to permit you to market so many bushels, so many bales of cotton," do you think his cooperation would be more difficult than if you permitted him to plant the acres he desired?

Mr. CORTRIGHT. I think you should have, if such a program is in effect, both acreage controls and a definite marketing quota. I think the farmer is not too good a gentleman when it comes to trying to curtail production.

The CHAIRMAN. I am sorry to hear that from you, sir.

Mr. CORTRIGHT. That is a frank appraisal, my personal opinion. Senator EASTLAND. In 1950 we had acreage controls.

Mr. CORTRIGHT. Yes, sir.

Senator EASTLAND. Do you remember what the allotment was that year?

Mr. CORTRIGHT. I think roughly 2311⁄2 is my recollection.

Senator EASTLAND. We had 232 million acres in cotton in 1950 under controls. What did we produce that year?

Mr. CORTRIGHT. Slightly under 10 million bales is my best memory. Senator EASTLAND. You can't take 1 year as a criterion.

Mr. CORTRIGHT. It depends on how the Lord puts his hand on our shoulders.

Senator EASTLAND. One year is meaningless.

Mr. CORTRIGHT. Absolutely.

The CHAIRMAN. What was the acreage?

Mr. CORTRIGHT. 1950 I thought it was controlled acreage in the neighborhood of 231% or 24.

From the Floor. Twenty-one and a half.

The CHAIRMAN. 1950-51, is that the one, the year of the Korean

war?

Senator EASTLAND. Yes.

The CHAIRMAN. Acres cultivated with 18,629,000, harvested 17,843,000, and the production was 10,014,000 bales.

Mr. CORTRIGHT. Allotments that year, roughly 211% was allotted, whether it was planted or not.

The CHAIRMAN. I gave you the figures as I have them from the Department of Agriculture.

Senator YOUNG. Has the quality of our cotton improved in recent years?

Mr. CORTRIGHT. I would say, certainly; from being a desirable cotton from the spinner standpoint it has improved.

Senator YOUNG. Could it be improved more?

Mr. CORTRIGHT. There is always hope of improvement through scientific advance.

Senator YOUNG. We have had many suggestions that price supports on wheat be based on quality of the wheat. We are providing at the present time a higher price support for wheat good only for feed purposes in many instances than we are for top quality milling wheat. Do you have that situation in cotton?

Mr. CORTRIGHT. The fourth recommendation on this page to some extent clarifies our position on that.

Senator YOUNG. How does quality of cotton produced in the United States compare with cotton produced in some other countries?

Mr. CORTRIGHT. Basically our cotton has better inherent characteristics than most foreign cottons not produced from our seeds.

Senator YOUNG. By increasing quality still further it would help in foreign trade?

Mr. CORTRIGHT. It would have a greater competitive advantage. The CHAIRMAN. I wish to state to the remaining witnesses that my hope is that those who propose to testify as to cotton will pay attention to the questions asked and also the statements made by Mr. Cortright. It is not our purpose to cross-examine all witnesses in the same manner as we are Mr. Cortright, but we are doing it with the first few witnesses to point up the problems so that you may become acquainted and if perchance when you come on the stand you desire to broaden or do anything else as to the questions and answers given by Mr. Cortright, you will be given that privilege.

Proceed, sir.

Mr. CORTRIGHT. Paragraph 4, page 9: Cotton growers are striving to attain levels of income comparable to those in the rest of agriculture and in other industries in these United States. If cotton farmers are forced to take a reduction in price support levels, adjustments should be made in a manner to correct existing marketing inequities and thereby accomplish long-term benefits for the entire industry. This could be done by using the average grade and staple of the crop as the basis for the loan rather than middling 8 inch.

Such a shift would discourage the production of unwanted staple lengths and grades. We recommend continuation of price supports at 90 percent of parity with changes in basic calculations as outlined above. It should be pointed out that the shift from the old to the new parity formula will lower price support levels substantially.

The current difference in parity for cotton between the old and new formula is approximately 100 points or $5 per bale. We consider the change in the parity formula to be a desirable one to eventually attain a more current relationship between selling prices and costs. This change in itself could, however, decrease the loan value of the 1956 crop by $60 million if 12 million bales were to be produced.

5. There is too little authentic information regarding the effects of price upon the consumption of cotton, both in the domestic and foreign markets. We urge that the Department of Agriculture initiate studies to determine the competitive positions of United States cotton and synthetics, the interrelations of price in principal end uses, and the competitive position of United States cotton and foreign growths.

We recommend that such information, together with cost reductions accompanying research findings and technological advancements in cotton production, be used in formulating long-term adjustments in price-support levels. These should serve as first steps toward development of price-support levels, volumes of production and cost relationships that will mean a healthy competitive position and comparable incomes for cotton growers in the future.

Senator EASTLAND. Back under recommendation 4, you recommend that this could be done "by using the average grade and staple of the crop as a basis for the loan rather than Middling % inch."

What does that mean?

Mr. CORTRIGHT. We feel that as near as can be calculated roughly Middling inch would approximate the average grade and staple of the crop and we would be completely satisfied with Middling inch if that is the will of the committee. We feel the average would be very nearly that.

The CHAIRMAN. On that staple you would desire the 90 percent support price?

Mr. CORTRIGHT. Yes, sir.

The CHAIRMAN. And anything below that, what would you do with it?

Mr. CORTRIGHT. Anything below the 90?

The CHAIRMAN. Below the inch.

Mr. CORTRIGHT. It would allow you to discount those lower cottons and less desirable grades. At present they cannot be discounted under 90 percent.

The CHAIRMAN. We have had quite a lot of testimony on other commodities suggesting that, as my good friend from North Dakota suggested.

Would you lower the support price on cotton that is under an inch to such an extent that it would discourage production of that staple and at the same time make it so cheap that we might be able to compete with that grade of cotton produced elsewhere for markets?

Mr. CORTRIGHT. In operation it is whatever the markets would pay for those lower grades would be the price for it.

The CHAIRMAN. Would you suggest that some method be worked out whereby if possible the price for these undesirable, unmarketable commodities such as cotton and wheat-we have a lot of it in storage particularly in wheat and also cotton-would be placed at a level to complete on the foreign market with much of the production in many areas of what we would call a questionable millable cotton here, seveneighths or a little under that, maybe a little above that?

Would you suggest that the price supports for cottons that are produced, and whose staple is under the inch, be so low that it will not only discourage production but at the same time it might put the price low enough for it to be used, and to sell, abroad?

Mr. CORTRIGHT. Certainly these cottons that are in excess surplus positions must be priced where they will be consumed.

The CHAIRMAN. That is what I am asking, do you suggest that?
Mr. CORTRIGHT. I think they must be priced where they will be con-

sumed.

The CHAIRMAN. I would like to ask your view on this and I would like for the other witnesses who follow you to listen to the question, and give their views on it when they testify.

As you know, no cotton that is now in the Commodity Credit Corporation inventory of set-aside cotton can be sold domestically unless it brings 105 percent of parity plus carrying charges and interest and what have you.

Would you suggest that the law be amended so as to give more leeway to Commodity Credit to dispose of these so-called undesirable cottons and make it possible for the administrator of the CCC to dispose of those cottons that are classified as undesirable today and also the wheat that may be classified as being undesirable?

Mr. CORTRIGHT. I should think anything, we can do to consume the present surplus in the minimum amount of time would be exceedingly desirable.

The CHAIRMAN. What provision would you suggest to prevent any of their cotton sold abroad from being used so as to increase the cotton spindles in competition and enhance additional advantages?

Mr. CORTRIGHT. Senate bill 2446, I believe, is a recommendation that has been endorsed by this group and we are in agreement with it. Senator THYE. Geographically, where is it best suited to grow that Middling-inch type cotton?

Mr. CORTRIGHT. Middling inch and better is grown entirely across the Cotton Belt except within certain areas of Texas. Certain areas of Texas can grow Middling inch and better cotton if they choose but under present situations and high support for % it becomes more profitable to grow shorter cotton and sell it to the loan.

Senator THYE. It can be grown in the highlands?

Mr. CORTRIGHT. Across the Belt with restricted areas of Texas excepted.

Senator THYE. Will the short length produce more per acre than the Middling inch?

Mr. CORTRIGHT. I am sure in analysis of the situation the cotton farmer in every area is growing that cotton that gives him the greatest dollar value per acre under the present price system.

I would say in those areas where it is presently grown it produces more. Where the better cottons are grown they are his best money crop at the present time.

Senator EASTLAND. Now with the situation of the loan based on Middling inch rather than Middling %, how much would that reduce the support price?

Mr. CORTRIGHT. Our best calculation is it would be in the neighborhood of 22 cents a pound which, added to the 1 cent which comes with the transitional parity, would give 32 cents per pound on next year's crop.

Senator EASTLAND. Is that what you advocate?

Mr. CORTRIGHT. A farmer never advocates a reduction in income. He is willing to accept such a thing but he never advocates it any more than a man advocates his salary be cut.

Senator EASTLAND. Is that the meaning of this recommendation? Mr. CORTRIGHT. If something must be done we think this is the better way to make the adjustment.

Senator EASTLAND. And is not the reason that you make that recommendation that cotton has to compete on the domestic market with synthetic fibers, notably rayon?

Mr. CORTRIGHT. Certainly it is a problem.

Senator EASTLAND. This would put us in a better competitive position with rayon, that is the reason for the recommendation, is it not? Mr. CORTRIGHT. That and the realization that through flexible prices we are going to take a reduction and we think we can clean up an internal complication in the cotton marketing through this recommendation and it would be more healthy than imposition of flexible pricing. The CHAIRMAN. Proceed.

Mr. CORTRIGHT. Recommendation No. 6, page 10: We also recommend that our technical assistance program should emphasize health, sanitation, and the raising of nutritional levels. We do not believe that it benefits any foreign country, and certainly it does no good to the United States for us to encourage the production abroad of crops of which there is already a world surplus and of which production is curtailed in the United States.

64440-56-pt. 5- -26