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APPENDIX A

EXISTENCE OF TRADE BARRIERS OF PRINCIPAL COUNTRIES EXPORTING CHEESE TO UNITED STATES

BARRIERS OTHER THAN CURRENCY DEVALUATION 1

1. Argentina. All imports require exchange licenses. Multiple currency practices result on the buying side from three buying rates, including the use of a free market rate.

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Pesos for

United

States

dollar

5.00

7.50

1 14. 60

1 Free market rate.

Transfers of capital require approval and are effected at the free market rate. 2. Canada, September 30, 1950.-Imports of textiles, leather goods, prepared foodstuffs, and certain miscellaneous goods from Cuba, Dominican Republic, El Salvador, Guatemala, Haiti, Panama, U. S. S. R., United States and possessions, and Venezuela require import licenses.

3. Denmark. Restrictions are exercised through licenses required for some imports from certain countries and for most imports from all other countries, and through licenses required for nontrade payments.

4. France. Same as Denmark.

5. Netherlands.-The Netherlands, its overseas territories and the Republic of Indonesia constitute an exchange control territory the "Netherlands monetary area. Transfers on capital account are approved only in exceptional cases. 6. Italy. Same as Denmark.

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7. New Zealand.-Imports from "scheduled" countries, including the United States, require import licenses. Transfers of capital require approval and are very difficult to obtain by "nonresidents."

8. Norway. Same as Denmark.

9. Switzerland.-Payments for imports from countries with which Switzerland has no payments agreement, including the United States, can be freely effected.

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1. Denmark. On September 18, 1949, the Danish krone was depreciated from 20.8376 to 14.4778 United States cents per krone or 30.5 percent.

2. Netherlands.-On September 21, 1949, the Netherlands guilder was changed from 37.6953 to 26.3158 United States cents per guilder, or 30.2 percent.

3. Norway.-On September 18, 1949, the Norwegian krone was depreciated from 20.15 to 14 United States cents per krone, or 30.5 percent.

4. United Kingdom.-On September 18, 1949, the United Kingdom pound sterling was changed from 403 to 280 United States cents per pound sterling, or 30.5 percent.

RESOLUTION CONCERNING THE DEFENSE PRODUCTION ACT ADOPTED BY THE DELEGATES TO THE ANNUAL CONVENTION OF THE NATIONAL MILK PRODUCERS FEDERATION, IN DAYTON, OHIO, NOVEMBER 1951

DEFENSE PRODUCTION ACT

When the Defense Production Act of 1950 was being considered, our Federation felt that with competent and sympathetic administration the act could be a constructive force in the protection of the national economy under the unsettled semiwartime conditions. But from the time of its passage to the present our experience with its administration has been one of disillusionment. Persons

in the upper levels of the agency inexperienced with our problems got into control of the Office of Price Stabilization and renewed the tactics of the old Office of Price Administration. This led to a revulsion of feeling among our people and a strong desire that the act in its entirely be repealed. Our attitude was re

1 Exchange restrictions, International Monetary Fund, April 1951. Schedule of Par Values, International Monetary Fund, March 1, 1952.

flected by a resolution passed on May 9, 1951, by the executive committee of the federation. The text of this resolution stated:

"The National Milk Producers Federation opposes authority for price and wage controls as set forth in the present Defense Production Act and in amendments which have been proposed. It opposes subsidies on agricultural products as provided for in proposed legislation to extend and amend the present act, and in any other legislation.

"The federation does not oppose proposed amendment of the Defense Production Act to extend authority for allocations, priorities, credit controls, and the requisitioning and condemning of property."

Recognizing that such action might be unattainable the federation also requested the Congress to include certain protective features with respect to the administration of producer prices and to entrust undivided power with respect to such administration to the Secretary of Agriculture.

These requests to convey these exclusive powers to the Secretary of Agriculture, all of which were embodied into law, were:

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1. Exclusive administration of the Agricultural Act of 1949.

2. Exclusive administration of the Agricultural Marketing Agreement Act of 1937, as amended.

3. Exclusive administration of the Cole-Ives amendment to the Defense Production Act dealing with the prices of fluid milk in non-Federal orders markets. 4. Exclusive administration of the pricing of milk for manufacturing purposes. 5. Exclusive administration of the standards for import controls of dairy products.

The federation further favored allocations among industries of basic raw materials, including agricultural plant equipment and farm machinery and equipment.

As to further powers that may be considered by the Congress in connection with this act and other acts, we oppose any roll-backs of the prices of agricultural commodities or products processed from them. We oppose individual rationing. We will oppose with every force at our command subsidizing the food bill of the consumer by paying subsidies directly to the producer in lieu of prices.

As to essential foods, we favor the provisions of the act which authorize the President to channel materials and commodities into lines of production that are deemed critically necessary to the rearmament program and to civilian needs. Should it become necessary to establish priority systems, we call attention to the fact that agriculture is most important to an adequate defense program. We therefore urge full recognition of the preeminent position of food products in the successful conduct of any rearmament program. With respect to both allocations and priorities we urge that greater recognition be given to the Secretary of Agriculture in carrying out his responsibilities as claimant agency for the needs of agriculture.

CONGRESS OF THE UNITED STATES,

Commissioner CHARLES W. CRAWFORD,
Food and Drug Administration,

HOUSE OF REPRESENTATIVES,
Washington, D. C., May 6, 1952,

Federal Security Agency, Washington, D. C.

DEAR MR. CRAWFORD: Recent outbreaks of hoof-and-mouth and other animal diseases in foreign countries have led to restrictions on the importation of fresh and frozen meats. This situation prompts me to raise a question both as to the standards and inspection procedures used by Food and Drug to prevent the spread of disease through imported dairy products. Therefore, I would appreciate your outlining

(1) Standards employed for butter and cheese, both of domestic and foreign origin, which are calculated to prevent the spread of human or animal communicable diseases; and

(2) The procedure which the Food and Drug Administration follows in making inspections to insure that both domestic and imported dairy products comply with established standards.

Specifically, I would appreciate your pointing out what procedures are employed to prevent the transmittal of hoof-and-mouth disease through dairy products from Canada, South America, Europe, or other places from which we import dairy products and which have current or recurrent outbreaks of this disease.

APPENDIX A

EXISTENCE OF TRADE BARRIERS OF PRINCIPAL COUNTRIES EXPORTING CHEESE TO UNITED STATES

BARRIERS OTHER THAN CURRENCY DEVALUATION 1

1. Argentina. All imports require exchange licenses. Multiple currency practices result on the buying side from three buying rates, including the use of a free market rate.

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Pesos for

United

States

dollar

5.00

7.50

1 14. 60

1 Free market rate.

Transfers of capital require approval and are effected at the free market rate. 2. Canada, September 30, 1950.-Imports of textiles, leather goods, prepared foodstuffs, and certain miscellaneous goods from Cuba, Dominican Republic, El Salvador, Guatemala, Haiti, Panama, U. S. S. R., United States and possessions, and Venezuela require import licenses.

3. Denmark. Restrictions are exercised through licenses required for some imports from certain countries and for most imports from all other countries, and through licenses required for nontrade payments.

4. France.-Same as Denmark.

5. Netherlands.-The Netherlands, its overseas territories and the Republic of Indonesia constitute an exchange control territory the "Netherlands monetary area." Transfers on capital account are approved only in exceptional cases. 6. Italy. Same as Denmark.

7. New Zealand.—Imports from "scheduled" countries, including the United States, require import licenses. Transfers of capital require approval and are very difficult to obtain by "nonresidents."

8. Norway.-Same as Denmark.

9. Switzerland.-Payments for imports from countries with which Switzerland has no payments agreement, including the United States, can be freely effected.

CURRENCY DEVALUATION 2

1. Denmark. On September 18, 1949, the Danish krone was depreciated from 20.8376 to 14.4778 United States cents per krone or 30.5 percent.

2. Netherlands.-On September 21, 1949, the Netherlands guilder was changed from 37.6953 to 26.3158 United States cents per guilder, or 30.2 percent.

3. Norway. On September 18, 1949, the Norwegian krone was depreciated from 20.15 to 14 United States cents per krone, or 30.5 percent.

4. United Kingdom.-On September 18, 1949, the United Kingdom pound sterling was changed from 403 to 280 United States cents per pound sterling, or 30.5 percent.

RESOLUTION CONCERNING THE DEFENSE PRODUCTION ACT ADOPTED BY THE DELEGATES TO THE ANNUAL CONVENTION OF THE NATIONAL MILK PRODUCERS FEDERATION, IN DAYTON, OHIO, NOVEMBER 1951

DEFENSE PRODUCTION ACT

When the Defense Production Act of 1950 was being considered, our Federation felt that with competent and sympathetic administration the act could be a constructive force in the protection of the national economy under the unsettled semiwartime conditions. But from the time of its passage to the present our experience with its administration has been one of disillusionment. Persons in the upper levels of the agency inexperienced with our problems got into control of the Office of Price Stabilization and renewed the tactics of the old Office of Price Administration. This led to a revulsion of feeling among our people and a strong desire that the act in its entirely be repealed. Our attitude was re

1 Exchange restrictions, International Monetary Fund, April 1951. Schedule of Par Values, International Monetary Fund, March 1, 1952.

flected by a resolution passed on May 9, 1951, by the executive committee of the federation. The text of this resolution stated:

"The National Milk Producers Federation opposes authority for price and wage controls as set forth in the present Defense Production Act and in amendments which have been proposed. It opposes subsidies on agricultural products as provided for in proposed legislation to extend and amend the present act, and in any other legislation.

"The federation does not oppose proposed amendment of the Defense Production Act to extend authority for allocations, priorities, credit controls, and the requisitioning and condemning of property."

Recognizing that such action might be unattainable the federation also requested the Congress to include certain protective features with respect to the administration of producer prices and to entrust undivided power with respect to such administration to the Secretary of Agriculture.

These requests to convey these exclusive powers to the Secretary of Agriculture, all of which were embodied into law, were:

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1. Exclusive administration of the Agricultural Act of 1949.

2. Exclusive administration of the Agricultural Marketing Agreement Act of 1937, as amended.

3. Exclusive administration of the Cole-Ives amendment to the Defense Production Act dealing with the prices of fluid milk in non-Federal orders markets. 4. Exclusive administration of the pricing of milk for manufacturing purposes. 5. Exclusive administration of the standards for import controls of dairy products. The federation further favored allocations among industries of basic raw materials, including agricultural plant equipment and farm machinery and equipment.

As to further powers that may be considered by the Congress in connection with this act and other acts, we oppose any roll-backs of the prices of agricultural commodities or products processed from them. We oppose individual rationing. We will oppose with every force at our command subsidizing the food bill of the consumer by paying subsidies directly to the producer in lieu of prices.

We

As to essential foods, we favor the provisions of the act which authorize the President to channel materials and commodities into lines of production that are deemed critically necessary to the rearmament program and to civilian needs. Should it become necessary to establish priority systems, we call attention to the fact that agriculture is most important to an adequate defense program. therefore urge full recognition of the preeminent position of food products in the successful conduct of any rearmament program. With respect to both allocations and priorities we urge that greater recognition be given to the Secretary of Agriculture in carrying out his responsibilities as claimant agency for the needs of agriculture.

CONGRESS OF THE UNITED STATES,

Commissioner CHARLES W. CRAWFORD,
Food and Drug Administration,

HOUSE OF REPRESENTATIVES,
Washington, D. C., May 6, 1952.

Federal Security Agency, Washington, D. C.

DEAR MR. CRAWFORD: Recent outbreaks of hoof-and-mouth and other animal diseases in foreign countries have led to restrictions on the importation of fresh and frozen meats. This situation prompts me to raise a question both as to the standards and inspection procedures used by Food and Drug to prevent the spread of disease through imported dairy products. Therefore, I would appreciate your outlining

(1) Standards employed for butter and cheese, both of domestic and foreign origin, which are calculated to prevent the spread of human or animal communicable diseases; and

(2) The procedure which the Food and Drug Administration follows in making inspections to insure that both domestic and imported dairy products comply with established standards.

Specifically, I would appreciate your pointing out what procedures are employed to prevent the transmittal of hoof-and-mouth disease through dairy products from Canada, South America, Europe, or other places from which we import dairy products and which have current or recurrent outbreaks of this disease.

Similarly, I would appreciate your giving the same type of information with respect to anthrax, brucellosis, and tuberculosis.

As a specific example, I would appreciate knowing how many separate lots of cheese have been imported from Italy during the past 12 months, how many of these have been inspected, what tests have been made to guard against the transmittal of communicable diseases such as those mentioned above, and what were the findings on these tests.

Does the degree of incidence of a particular disease as tuberculosis in milk animals in the country of origin influence the type or frequency of inspections? Also, if the inspection of cheese imports from a given country shows a considerable amount of adulteration, how does this affect inspection procedure on future imports from this particular source?

Your reply by Friday, May 9, would be greatly appreciated.
With kindest personal regards, I remain

Sincerely yours,

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Hon. AUGUST H. ANDRESEN,
House of Representatives,

Washington, D. C.

DEAR MR. ANDRESEN: This replies to your letter of May 6 in which you request information as to the standards and inspection procedures employed by the Food and Drug Administration to insure against the spread of certain infectious diseases through imported dairy products. We will first answer in general terms the questions asked in the numbered paragraphs on page 1 of your letter.

(1) The Federal Food, Drug, and Cosmetics Act, which is the principal statute enforced by this Administration, requires butter and cheese and other manufactured dairy products moving in interstate commerce to be prepared from clean and wholesome materials under sanitary conditions which protect them from contamination with filth, and to be free from any substances which would render them injurious to health. In addition, definitions and standards of identity for cheese and cheese-food products promulgated under the act require either the pasteurization of the milk used in their manufacture, or the aging of the cheese for a sufficient time to insure with reasonable certainty the disappearance of pathogenic organisms before shipment in interstate commerce. The factual basis for this requirement will be discussed in detail below. These requirements are applicable to imports as well as to products of domestic origin. Further, fluid milk and cream imported into this country are subject to the requirements of the Federal Import Milk Act which is also enforced by this Administration. Under that act milk and cream may be imported only from shippers which have been granted permits by the Federal Security Administrator. Permits for such importation may be issued only upon satisfactory evidence that animals in the herds producing such milk or cream have been tuberculin tested and are otherwise in healthy condition, and that the dairy farms and plants handling the milk or cream are in acceptable sanitary condition. At the present time the only effective permit is held by a Canadian shipper. The act does not apply to other dairy products.

(2) Our program on manufactured dairy products of domestic origin is based primarily on the factory inspection. Each factory inspection includes examination of incoming milk and cream for evidence of filth and decomposition, attention to the adequacy of the pasteurization process and, in the case of cheese products required to be aged in lieu of pasteurization, attention to the procedures employed to insure that the requirements are met. If the factory inspection evidence indicates a violation of these standards, samples are examined from the interstate output of the firm.

The program on imported dairy products differs from that on products of domestic origin in that we do not have opportunity for factory inspection of the foreign producers, since we have no inspectors stationed in foreign countries. We do, however, examine samples from lots offered for imports. The extent of sampling is based upon previous experience on the likelihood of violation in specific products, as related to manufacturers and country of origin. Samples are examined for filth and for compliance with the fat and moisture requirements of any applicable standard of identity and for pasteurization where pasteurization is specifically required. If aging is permitted in lieu of pasteurization, at the present time we have no entirely adequate procedure for determining compliance

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