Mr. WHITTEN. We come to the sugar program now. Pages 212 through 217, 219 through 229 of the justifications will be included in the record at this point. (The material referred to is as follows:) SUGAR PROGRAM PURPOSE STATEMENT Objectives. The principal objectives of the sugar program, carried out under the Sugar Act of 1948, as amended, are (a) to protect the welfare of domestic producers, (b) to provide consumers with adequate supplies of sugar at reasonable prices, and (c) to promote our general export trade. Provision is also made to insure that a fair share of the consumer's dollar goes to domestic producers of sugarcane and sugar beets and to laborers working in cane and beet fields. The attainment of these objectives involves: cane. 1. Determination of United States sugar requirements. 2. Administration of quotas to regulate imports of sugar produced in foreign areas and the marketing of sugar produced in domestic areas. 3. Allotment of quotas to individual processors when necessary to insure orderly marketing. 4. Making of payments to domestic producers of sugar beets and sugarcane who meet certain specific conditions. The continental United States produces sugar from both sugar beets and sugarAdditional quantities of sugar are produced from sugarcane in Hawaii, Puerto Rico, and the Virgin Islands. Domestic sugar, produced at higher cost per unit than in foreign areas, falls far short of meeting the Nation's requirements. To meet total needs, the United States imports substantial quantities of sugar from foreign areas, mainly from Cuba and the Philippines. If unlimited quantities of sugar were permitted entry into the continental United States from Cuba, the Philippines, and other foreign countries, prices to domestic consumers under ordinary circumstances could be expected to be slightly lower than at present. However, under present wage standards in domestic producing areas, unlimited imports would place domestic producers in an extremely difficult, if not impossible, competitive position. Moreover, the economies of most of the domestic cane sugar-producing areas are dependent on sugar-producing crops for which there is no feasible alternative. Quotas.-The Sugar Act of 1948, as amended, provides a quota system to balance supply with demand. The Secretary of Agriculture, as authorized by the act, determines at the end of each calendar year the Nation's sugar requirements for the coming year. Requirements for the calendar year 1957 were initially established in December 1956 at 8,800,000 short tons, raw value, and on January 18, 1957, the quota level was raised to 9 million tons, revised to 9,100,000 tons on June 20, 1957, and increased to 9,300,000 tons effective July 10, 1957. On August 14, 1957, the quotas were reduced to 9,200,000 tons, as the upward price trend reversed itself and offerings of supplies became adequate. Quotas were further reduced, effective October 12, 1957, to the level of 9,050,000 tons to assure continued stability in domestic sugar prices. All increases were distributed quotawise in accordance with provisions of the Sugar Act. The quota provisions of Public Law 545, 84th Congress, approved May 29, 1956, became effective as of January 1, 1956. This law, amending and extending the Sugar Act of 1948, as amended, restores to the domestic areas their historic participation in the growth of the United States sugar market. Beginning in 1956, market growth in excess of 8,350,000 tons will be shared 55 percent. by domestic areas and 45 percent by foreign countries. Distribution of quotas among foreign countries has been changed so that foreign countries other than Cuba and the Republic of the Philippines share to a greater extent than heretofore in market growth beginning in 1957. Marketing allotments.-The act provides that the quota for any area shall be allotted to persons who market or import sugar when necessary to insure orderly marketing and to afford interested persons an equitable opportunity to market sugar within the quota limitations. Production adjustment.—The act provides that if production in any area will be greater than the quantity necessary to fill the quota and provide a normal carryover inventory, restrictive proportionate shares (farm marketing allotments), shall be established. A restrictive program is designed to balance supplies within an area with the quota and normal carryover requirements. The total quantity of sugar which may be produced in an area is divided among individual growers, and as one of the conditions for payment, production must not exceed the proportionate share. Payments.-Domestic producers of sugar beets receive conditional payments averaging about $2.41 per ton of beets. For producers of sugar cane the payments within the various domestic producing areas range from about $1.06 to $1.60 per ton of cane. The Sugar Act imposes a special tax of 50 cents per hundredweight of sugar, raw value, on all manufactured sugar from sugar beets or sugar cane either produced in or brought into the continental United States. ▸ Revenue. From the inception of the program in the 1938 fiscal year through the fiscal year 1957, $1,478,697,674 of sugar excise and import taxes have been collected while obligations under the program have amounted to $1,113,410,043. Increase (for mandatory payments to sugar producers) $67, 662, 500 76, 000, 000 $67, 662, 500 76, 000, 000 +8, 337, 50 INCREASE (1) An increase of $8,337,500 for making payments to sugar producers as follows: (a) An increase of $6,083,010 in payments on the 1957 sugar crop deferred until fiscal year 1959 as compared with similar payments on the 1956 sugar crop deferred until fiscal year 1958. (b) A net increase of $2,254,490 in payments on the 1958 sugar crop, due principally to increased production in Hawaii and Puerto Rico. On the basis of current estimates of production, a total of $73,600,120 (including administrative expenses) will be required for the 1958 sugar program, plus $18,719,482 for payments on the 1957-58 crop, which were deferred until the fiscal year 1959, making total requirements for the program $92,319,602. Of the $18,719,482 deferred until the fiscal year 1959, $16,600,284 if for payments in Puerto Rico (1957-58 crop), and $2,119,198 applies to payments in the domestic beet area for which funds are not available in fiscal year 1958. The deferral in Puerto Rico causes no hardship since the harvesting of the 1957-58 crop will not be completed until the first month of the fiscal year 1959. The appropriation requested of $76 million contemplates an estimated deferral of $16,319,602 until fiscal year 1960 for payments on the 1958-59 Puerto Rico crop. The increase requested is necessary in order to prevent deferral of payments to producers in the domestic area. Both fiscal and crop year estimates are compared in table I. Total sugar production from the 1958 crops in the domestic areas is estimated at 5,160,000 short tons, raw value. This is 39,900 tons more than estimated total production from the 1957 crops. Domestic beet sugar area production from the 1958 crop is estimated at 2,025,000 short tons, raw value, which is 140,000 tons less than the 1957 crop is expected to produce. The 1958 crop figure represents a production objective in line with anticipated sugar quota and carryover stocks requirements for the area. Production from each of the 1957 and 1958 crops in the mainland cane sugar area is estimated at 640,000 and 650,000 tons, respectively, which is commensurate with the area's expected quota and inventory requirements. Hawaii's 1958 crop production is estimated at 1,175,000 tons which is 75,000 tons higher than the area's 1957 crop production estimate. Sugar yields from the latter crop are proving to be substantially less than was anticipated. The 1958-59 crop production estimate of 1,300,000 tons for Puerto Rico is consistent with prospective quota and inventory needs for the area although it is 100,000 tons higher than the island's estimated 1957-58 crop production. Production from the 1958 crop in the Virgin Islands is estimated at 10,000 tons. This is 5,100 tons lower than the islands' 1957 crop production, and is short of the area's probable quota level. The estimate for the 1958 sugar crop program, compared with prior crop year data on tonnage, production, total payments and average payment per ton, is shown in table II. The number of payees are shown in the following table. |