(In addition to the activities and accomplishments of the Agricultural Marketing Service, other activities within the Department of Agriculture are also directed toward this same general objective of expanding markets and increasing the consumption and utilization of agricultural commodities as discussed in the hearings on, for example, the Foreign Agricultural Service and the Agricultural Research Service.)

HANDLING PROBLEMS RESULTING FROM AGRICULTURAL POLICIES OF FOREIGN GOVERNMENTS

Mr. NATCHER. Now, Mr. Secretary, in attempting to locate new markets, do you from time to time run into problems concerning agricultural policies of foreign governments?

Mr. PAARLBERG. Yes; indeed, we do.

Mr. NATCHER. This brochure and booklet that is published by the Department from the Foreign Agricultural Service entitled, “Agricultural Policies of Foreign Governments, Including Trade Policies Affecting Agriculture," is a fine publication.

Mr. PAARLBERG. Thank you. We are very proud of that publication. Mr. NATCHER. Now, when you run into these problems, what do you do about them?

Mr. PAARLBERG. We do a number of things. One thing we do is to negotiate with these countries on the General Agreement on Tariffs and Trade to see if we cannot by mutual agreement get them to lower some of the barriers that they have with respect to our products. This means lowering their tariffs. It means reducing their quotas. It means freeing up the foreign exchange with which they can buy our products. It means modifying their controls and specifications and like things. We have been successful in the past in the tariff negotiations in improving our opportunities to export agricultural products. Mr. NATCHER. At this point, assuming you run into some difficulty with one of our friends abroad concerning trade policies, do you at any time take the difficulty through the Department of State and attempt to have it handled in some manner through the mutual security program arrangement?

Mr. PAARLBERG. We often encounter problems that have to do not only with the commercial policy but the foreign policy of this Government. On those occasions we do, I think appropriately, confer with the Department of State. In the negotiations at Geneva under the General Agreement on Tariff and Trade, both the State Department and the Department of Agriculture are involved. We endeavor to work out with the Department of State and with the ICA solutions for various commodity problems and various problems involving particular countries. We sometimes can develop, through ICA, export programs that permit us to do what otherwise we could not. We sometimes convince the State Department that opportunities to move agricultural products should be developed in certain areas in spite of misgivings they may have about these factors. They, as agencies of the Government, are and must be concerned, working within the present environment.

RELATIONSHIP OF PUBLIC LAW 480 SALES TO SCHOOL-LUNCH PROGRAM

Mr. WHITTEN. I would like for the record to show at this point— it has been discussed earlier-the amount of commodities sold through Public Law 480 that would have been useful by the school-lunch program and that were sold at such times that they were not made available to the school-lunch program.

My attention is called to the fact that the order of priority, insofar as the sale of CCC commodities is concerned is as follows: First come the sales for dollars, next come sales under Public Law 480, and then come donations, and under donations would come our own schoollunch programs. That, doubtless, is the law. Yet I find myself in complete disagreement, if we are going to sell commodities which we have for foreign currencies which, in effect, we give back to those countries at a time when the commodities are badly needed by the American schoolchildren under our own program. I would like for the record to show the kinds of commodities that have been sold under Public Law 480 that would have been usable for the school-lunch program.

I would certainly urge the law be changed so that we could use these commodities for our own use first and then sell them under Public Law 480 second. If we cannot do it that way, I would personally be of the opinion that we should set aside section 32 funds for the school-lunch program so that the Department would have little, if any, excuse to drag its feet before stepping in to support some of these markets and it would be a better way to strengthen the school-lunch program which appears to need strengthening under certain conditions. If we could have that full story at this point put in the record we would be pleased to have it.

Mr. WELLS. Yes. There are 1 or 2 technical problems to be solved; 1 or 2 of the items mentioned in connection with the school-lunch program are not items acquired under CCC programs under supportprice programs, or sections 32.

Mr. WHITTEN. I am interested only in Government commodities.

Mr. WELLS. Well, that was my point. There are 1 or 2 commodities that are surplus to our normal domestic consumption for purposes of title I. Public Law 480, but they are not surplus to the extent that they come into the CCC or are bought under section 32.

Mr. WHITTEN. I am only interested in the CCC commodities. Mr. WELLS. You are talking about commodities here and the ownership of the CCC that might have been otherwise used.

Mr. WHITTEN. I assume that the CCC holds them all.

Mr. WELLS. Section 32 commodities cannot be sold abroad.

Mr. PAARLBERG. I am sure that it could be done. It will be rather involved, the accounting procedure that we will have to go through. Mr. WHITTEN. I would be glad to have it. Include all commodities moving under Public Law 480 suitable for use in the school-lunch program. It would enable the committee to make a determination as to what course to follow.

(The information requested is as follows:)

DISTRIBUTION OF AGRICULTURAL COMMODITIES TO FOREIGN COUNTRIES UNDER PUBLIC LAW 480 AND DISTRIBUTION OF SURPLUS COMMODITIES TO SCHOOLLUNCH PROGRAMS

Title I of Public Law 480 authorizes the sale of surplus agricultural commodities to friendly countries for their own currencies. These surpluses may move from CCC stocks or from commercial stocks.

Title II of Public Law 480 authorizes the use of CCC stocks of agricultural commodities in meeting famine or urgent relief needs of friendly foreign countries or of friendly populations without regard to the friendliness of their government.

In addition, Title III of Public Law 480 amended section 416 of the Agricultural Act of 1949 which is the authority under which food commodities available in the inventories of CCC are donated to school-lunch programs and other outlets in this country and to United States private welfare agencies for donation to needy people overseas. Schools are given first priority on CCC inventories available for donation under section 416. Schools also are the priority outlet for foods acquired by the Department under section 32 surplus-removal purchases.

With respect to the price supported commodities moving under titles I and II of Public Law 480, school-lunch programs have received the quantities they could effectively utilize during the periods these commodities were available for commitment.

Through fiscal year 1957, schools were receiving about their full needs of the non-price-supported commodities moving under title I, with the exception of potatoes in 1956 and dried fruit in 1957. In the first half of the fiscal year 1958 several items have moved under title I as a part of commitments made in the previous fiscal year. These items, which include 16.7 million pounds of meat, and 3.2 million pounds of lard, have not been available for donation to schools through the first half of the fiscal year. With regard to fruits, although no distribution of surplus fruits was made to schools in the first half of 1958, approximately 6.5 million pounds of canned grapefruit sections have been purchased for the school-lunch program under the section 32 surplus removal authority and distribution of this supply is now underway.

The following table shows the quantities of commodities which have been disposed of under title I and title II of Public Law 480 and the quantities of the surplus food commodities which were donated to the school-lunch program under the authority of section 416 or section 32. Inasmuch as the schools have first priority for commodities donated under title III, the distribution to foreign outlets under this title is not included in the table. The table covers the fiscal years 1955 through 1957 and the first half of fiscal 1958.

ADDITIONAL PRICE SPREAD INFORMATION

Mr. WELLS. Mr. DeLoach's statement is in the nature of a report along the line of work for which this committee and the Congress have established a sublimit. I would like to ask in addition to the material which he has submitted for the record that he also be allowed to submit a list of the projects which are underway so that we will have a record of what we are actually doing. We have planned to do that. Mr. WHITTEN. We will be glad to have it. I hope you will take the time to lift from his statement those highlights, facts and figures, and put them in one table where they will be more readily readable.

Mr. WELLS. We will do that. I believe, Mr. Chairman, he also has some charts to illustrate some of the findings.

Mr. WHITTEN. We will be glad to have them in the record, too. (This material is included on pp. 1203, 1204, 1221-1238 of these hearings.)

Mr. WHITTEN. The committee will stand adjourned until Wednesday at 10 o'clock.