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their charges beyond the levels agreed to by the public operators and we have already established that the public operators will not agree to rates which are oppressive upon the public. * Furthernuore, under section 15 of the Shipping Act, we already have one Federal regulatory agency, the Federal Maritime Board, which has jurisdiction to approve or disapprove all changes in rates by signatories to agreements under section 15 of the Shipping Act. Superimposition of OPS jurisdiction is not only unnecessary, but would inevitably interfere with the discretion delegated to the Maritime Board with regard to both public and private operators in this respect.

Our support for H. R. 7079 is therefore made to clarify the intention of Congress, to avoid discrimination between public and private port operators and between public agencies operating ports and operating other facilities, to avoid the necessity of continued litigation between State and Federal officials, to avoid conflict between two Federal agencies, and to leave to the local representatives of the people the decision as to the best method of defraying increases in the cost of local services.

I am submitting, with the committee's permission, a copy of the American Association of Port Authorities resolution on the subject for inclusion in the record.

With the committee's permission, also, I should like to have included in the record a statement by the California Association of Port Authorities and the Northwest Marine Terminals Association on the subject. It was filed in support of S. 2722 with the Senate Banking and Currency Committee; while it is nominally addressed to that Senate bill, it applies equally to H. R. 7079, the companion bill in the House.

Thank you.
The CHAIRMAN. The clerk will call the next witness.

The CLERK. The next witness is Mr. C. L. Snavely, representing the National Association of Frozen Food Packers.

The CHAIRMAN. You may proceed, Mr. Snavely.

STATEMENT OF C. L. SNAVELY, PRESIDENT, NATIONAL

ASSOCIATION OF FROZEN FOOD PACKERS Mr. SNAVELY. My name is Clarence Snavely. I am president of the Consumers Packing Co. of Lancaster, Pa., and also president of the National Association of Frozen Food Packers. This association is a voluntary, nonprofit trade association whose members produce approximately 75 percent of the national volume of frozen fruits, vegetables, and juices.

The position of the National Association of Frozen Food Packers in regard to price control is clearly set forth in the following resolution, unanimously adopted by its board of directors at a meeting held March 6, 1952:

The National Association of Frozen Food Packers, being conscious of the dangers of inflation to the American economy and of the potentially serious consequences of inflation upon the frozen fruit, berry, vegetable, and juice industry, but being vigorously opposed to nonessential and uneconomic price controls, submits the following considerations and resolution for the attention of the Office of Price Stabilization:

That, as of February 1, 1952, supplies of frozen fruits, berries, vegetables, and juices were 12 percent greater than on the same date of 1951;

That during the year 1951 the average consumer purchased 30 percent more frozen fruits, berries, vegetables, and juices than in 1950, according to the report of Industrial Surveys, Inc.;

That in 1951 the Quartermaster Corps of the Army purchased 100 percent more of those products than it purchased in 1950;

That, despite this greatly increased usage during that period, retail prices of those products, as calculated by the Bureau of Labor Statistics, declined 5 percent;

That it is evident that under present conditions supplies of such products are adequate to meet existing and prospective civilian and military demand;

That it is further evident that price controls on such products are not necessary for the protection of consumers;

That competition is increasing rather than decreasing in this industry, thus continuing the pressure for lowered prices;

That price controls impose a heavy burden upon the industry by their requirements of hundreds of man-hours of effort to comply with administrative formalities, to calculate price ceilings, and to determine the various applications of pricing regulations, as well as by the waste of executive time and energy in the development of factual bases for the regulations, and in advisory committee and other work with representatives of the Office of Price Stabilization;

That the inflexibility of price controls is such that the industry is foreclosed from equalization of prices as between a grade of a particular product which is in short supply and another grade of such product which is in relatively surplus supply;

That price control is justified only in conditions of scarcity resulting in bidding up of prices for scarce commodities;

That, it being evident that price control is not justified in the frozen fruit, berry, vegetable, and juice industry; it is

Resolved, That the Office of Price Stabilization respectfully is urged immediately to suspend price controls on frozen fruits, berries, vegetables, and juices and to reinstate such controls only for such of those foods as may, in the future, be in short supply to such a material extent as to require reinstatement of controls in the public interest.

The purpose of my testimony is to present additional facts in support of the foregoing resolution and in support of suspension of price controls in the frozen-food industry.

The facts of the frozen-food industry are simple, and elementary economics clearly demonstrates that there are no inflationary influences present in the frozen-food picture.

Chart I clearly indicates the high level of stocks of frozen fruits and vegetables. These stock data are compiled by the United States Department of Agriculture. You will note that stocks of frozen fruits and vegetables have been increasing to an appreciably higher level each year. Stocks on April 1, 1952, were 8 percent greater than on the same date in 1951.

Chart 2 shows how the production of frozen fruits and vegetables has been reaching new record totals every year. The total pack in 1951 was 12 percent greater than in 1950, and more than twice as great as average production in 1943-45. The 1951 pack was the greatest in the history of the industry.

The strength of America and now the salvation of the world appears to lie in increased production. Only with increased production can costs and selling prices be reduced. Chart 3 has been prepared from prices compiled and published by the Bureau of Labor Statistics. This chart clearly shows the effect of increased production in reducing prices of frozen fruits, juices and vegetables.

You will note that on that chart, the frozen foods, for December 1950, to March 1952, declined 7 percent, whereas all foods increased 6 percent in the same period.

Most frozen fruit and vegetable products are being sold by frozenfood packers at prices below their ceilings. Results of a survey conducted by the National Association of Frozen Food Packers indicate items representing 88 percent of the frozen fruit pack and 81 percent of the frozen vegetable pack are selling below ceilings. Over all, 82 percent of these items are below ceilings.

Furthermore, nearly half or 48 percent of the frozen-fruit items are selling at prices which are more than 10 percent below ceiling. And 36 percent of the frozen vegetable items are more than 10 percent below ceilings. Charts 4 and 5 illustrate dramatically the extent to which frozen fruits and vegetables are selling below their ceilings.

With this record you may well ask, "Why should frozen food packers be concerned with price controls?” The answer is simple.

Price controls by nature cannot have the flexibility needed in an industry such as the frozen-food industry, which deals with seasonal crops. Such controls are extremely burdensome to the members of this industry. The executive and clerical man-hours required to interpret regulations and make the necessary computations are beyond the capabilities of most small companies. In the case of large companies there are many employees whose sole duty it is to study price regulations and determine the ceiling prices thereunder.

This is needless economic waste in an industry where profits are historically on a narrow margin. Moreover, we firmly believe that, under the American system and in the conditions in which our industry is now operating, the furden should be upon the Government to justify continuance of controls and that it should have the positive obligation to suspend those which are not needed.

Price controls for the frozen-food industry under present circumstances are a one way street that can only lead to the weakening or bankruptcy of an industry that has established an enviable record for increased production and lower prices for the American people.

We strongly urge, therefore, that statutory criteria for suspension of controls be established by Congress, and that these criteria be established in such unequivocal terms as to make certain that an industry in the position of ours will no longer be burdened with uneconomic and unnecessary controls.

That concludes my statement, Mr. Chairman. We would like to submit the charts attached to my statement for the record.

The CHAIRMAN. That may be done.
(The charts above referred to are as follows:)

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SOURCE:NATIONAL ASSOCIATION OF FROZEN FOOD PACKERS, Based on data

published by U. S. DEPARTMENT OF AGRICULTURE

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That competition is increasing rather than decreasing in this industry, thus continuing the pressure for lowered prices;

That price controls impose a heavy burden upon the industry by their requirements of hundreds of man-hours of effort to comply with administrative formalities, to calculate price ceilings, and to determine the various applications of pricing regulations, as well as by the waste of executive time and energy in the development of faetual bases for the regulations, and in advisory committee and other work with representatives of the Office of Price Stabilization;

That the inflexibility of price controls is such that the industry is foreclosed from equalization of prices as between a grade of a particular product which is in short supply and another grade of such product which is in relatively surplus supply;

That price control is justified only in conditions of scarcity resulting in bidding up of prices for scarce commodities;

That, it being evident that price control is not justified in the frozen fruit, berry, vegetable, and juice industry; it is

Resolved, That the Office of Price Stabilization respectfully is urged immediately to suspend price controls on frozen fruits, berries, vegetables, and juices and to reinstate such controls only for such of those foods as may, in the future, be in short supply to such a material extent as to require reinstatement of controls in the public interest.

The purpose of my testimony is to present additional facts in support of the foregoing resolution and in support of suspension of price controls in the frozen-food industry.

The facts of the frozen-food industry are simple, and elementary economics clearly demonstrates that there are no inflationary influences present in the frozen-food picture.

Chart I clearly indicates the high level of stocks of frozen fruits and vegetables. These stock data are compiled by the United States .Department of Agriculture. You will note that stocks of frozen fruits and vegetables have been increasing to an appreciably higher level each year. Stocks on April 1, 1952, were 8 percent greater than on the same date in 1951.

Chart 2 shows how the production of frozen fruits and vegetables has been reaching new record totals every year. The total pack in 1951 was 12 percent greater than in 1950, and more than twice as great as average production in 1943-45. The 1951 pack was the greatest in the history of the industry.

The strength of America and now the salvation of the world appears to lie in increased production. Only with increased production can costs and selling prices be reduced. Chart 3 has been prepared from prices compiled and published by the Bureau of Labor Statistics. This chart clearly shows the effect of increased production in reducing prices of frozen fruits, juices and vegetables.

You will note that on that chart, the frozen foods, for December 1950, to March 1952, declined 7 percent, whereas all foods increased 6 percent in the same period.

Most frozen fruit and vegetable products are being sold by frozenfood packers at prices below their ceilings. Results of a survey conducted by the National Association of Frozen Food Packers indicate items representing 88 percent of the frozen fruit pack and 81 percent of the frozen vegetable pack are selling below ceilings. Over all, 82 percent of these items are below ceilings.

Furthermore, nearly half or 48 percent of the frozen-fruit items are selling at prices which are more than 10 percent below ceiling. And 36 percent of the frozen vegetable items are more than 10 percent below ceilings. Charts 4 and 5 illustrate dramatically the extent to which frozen fruits and vegetables are selling below their ceilings.

M
PC

With this record you may well ask, “Why should frozen food packers be concerned with price controls?" The answer is simple.

Price controls by nature cannot have the flexibility needed in an industry such as the frozen-food industry, which deals with seasonal crops. Such controls are extremely burdensome to the members of this industry. The executive and clerical man-hours required to interpret regulations and make the necessary computations are beyond the capabilities of most small companies. In the case of large companies there are many employees whose sole duty it is to study price regulations and determine the ceiling prices thereunder.

This is needless economic waste in an industry where profits are historically on a narrow margin. Moreover, we firmly believe that, under the American system and in the conditions in which our industry is now operating, the furden should be upon the Government to justify continuance of controls and that it should have the positive obligation to suspend those which are not needed.

Price controls for the frozen-food industry under present circumstances are a one way street that can only lead to the weakening or bankruptcy of an industry that has established an enviable record for increased production and lower prices for the American people.

We strongly urge, therefore, that statutory criteria for suspension of controls be established by Congress, and that these criteria be established in such unequivocal terms as to make certain that an industry in the position of ours will no longer be burdened with uneconomic and unnecessary controls.

That concludes my statement, Mr. Chairman. We would like to submit the charts attached to my statement for the record.

The CHAIRMAN. That may be done.
(The charts above referred to are as follows:)

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SOURCE:NATIONAL ASSOCIATION OF FROZ FOOD PACKERS, Based on dota

Dublished by U.S. DEPARTMENT OF AGRICULTURE

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