The prime beneficiary of our frozen tuna imports has been Japan, although in recent years other nationals have participated to a lesser degree. Thus Japan has benefited from the maximum dollar credits to support its trade with this country, which in turn makes for sound reciprocity. At the same time Japan has been enjoying a participation in the canned tuna market of this country up to 20 percent of the market at the very low duty of 122 percent on canned tuna in brine. During this period Japan has exported little canned tuna in oil into the United States. On the other hand, practically all of the American canned tuna pack is put up in oil. This has given Japan an exceptionally large participation in the American tuna market when you take into consideration both their frozen exports and their exports of canned tuna in brine. BENEFITS TO THE UNITED STATES Under these ground rules the market of canned tuna in the United States has increased from approximately 2,500,000 cases prewar to its current position of consuming some 17 million cases of canned tuna annually. This growth could not have been accomplished without this country keeping its doors open to the frozen tuna production of the high seas of the world. Practically without exception, all American tuna canners participate heavily in the free imports of frozen tuna coming into this country. At the same time they have maintained a maximum market for the full productivity of the American tuna fishing fleets. All of this production is processed in accordance with rules and standards of packing promulgated by the U.S. Food and Drug Administration. It provides extensive employment to American labor in all of the canning centers and in addition provides for further use of American labor in the fabrication of the cans, cases, labels, refining of the domestic production of oils, salt, and condiments that are used in the pack. It also provides revenues to our various transportation systems which transport this pack throughout the Nation. This production moves into consumption by the American consumer under well known established and advertised American brands. As a result of this expansion in production and stimulated consumption, the American housewife today, and for several years past, is able to buy canned tuna at substantially lower prices than were paid prewar. In addition, there is a plus in the value of this commodity due to its high protein and extensive nutrient values from the sea, which are being recognized now as never before. CONCLUSION In the light of the above, we respectfully urge that there not be any changes made in the rules and regulations pertaining to the importation of frozen tuna, frozen tuna loins, canned tuna in oil, and canned tuna in brine. SAN DIEGO, CALIF., March 22, 1962. Chairman WILBUR D. MILLS, New House Office Building, Washington, D.C.: Reference testimony of Secretary of Commerce Luther II. Hodges using tuna fishing industry tariff problems as an example of successful adjustment. His statement gives a wrong impression-our return to competitive ability requires much more detailed analysis. Program of conversion to seiner from bait boat fishing technique not financed in large part by loan program. Initial requests for assistance from Government turned down first conversion October 3, 1957: 16 conversions later, first Government-financed conversion completed, D.V. West Point, January 26, 1960. Of first 50 conversions, only 4 conversions were financed under fish loan program. Fish loan program did prevent complete bankruptcy of fleet and dispersal of fleet to foreign lands and from San Diego. Average trip success of converted seiner members is 6.3 trips in 1961. Troubles of vessel owners and fisherman started in 1947, and aggravated in 1951 when Government policy initiated to help Japan's fishing industry. Decision to place tariffs and quotas on canned goods, and place frozen and fresh tuna free of tariffs and duties, placed U.S. tuna vessel owners and fishermen at great competitive disadvantage. Bait boat technique was competitive with Japanese fishermen. But unrestricted flow of frozen tuna caused U.S. canners to make purchases and first handling of imported fish rather than U.S. fishermen. Vessels required to stay in port with fish aboard for months. Although conditions in industry well known to all segments of Government during 1951-59, little if any assistance provided. San Diego lost five of six canneries. Fleet has been reduced from high of 252 vessels in San Diego to present size of 92 vessels. Three vessels in 1959, with Government loans, were sold under foreclosure proceedings. Although replacement value near $300,000 per vessel, no sale price exceeded $47,000. Share of imports in 1947, 6.3 percent of total supply. In 1957, 49.4 percent; in 1958, 53.7 percent; in 1959, 60.9 percent; in 1960, 56.7 percent. Now Japan wants more of a share in the imports and its Government has made recent official moves in this direction. Further U.S. support for Japan's tuna industry will effectively remove only U.S. high seas fishing fleet. AUGUST FELANDO, General Manager, American Tunaboat Association. CHEESE IMPORTERS ASSOCIATION OF AMERICA, INC., Re II.R. 9900, Trade Expansion Act of 1962. COMMITTEE ON WAYS AND MEANS, Washington, D.C. (Attention of Leo H. Irwin, Esq., Chief Counsel.) GENTLEMEN: Our association wishes to urge your committee to act favorably on the above bill in order to promote the best interests of our country. Our association consists of a major portion of the cheese importers in the United States. Our member firms also are large and substantial distributors of domestic products. We strongly feel that it is necessary that the President have new negotiating power in order to protect our own trade position in world markets. The United States, as the bulwark of democracy, cannot permit its foreign trade to dwindle or to be injured by the lack of power to negotiate tariffs and trade agreements on a competitive basis. There are sufficient safeguards in the proposed legislation to protect domestic industry against imports, and it is urgent for the growth of our domestic industry that it be able to compete in foreign markets with the products of other countries, both free and those behind the Iron Curtain. We feel that the proposed legislation will accomplish this objective, and we strongly recommend your favorable action on this bill. Respectfully yours, MARTIN A. FROMER, Counsel. STATEMENT OF OTIE M. REED. EXECUTIVE DIRECTOR, NATIONAL CREAMERIES ASSOCIATION Mr. Chairman and members of the committee. I am executive director of National Creameries Association with offices at 1107 19th Street NW., Washington 6. D.C., on whose behalf this statement is made. The members of National Creameries Association are dairy processing and merchandising organizations, practically all of these being locally owned and operated cooperative associations of dairy farmers. Our membership is located in Wisconsin, Minnesota, North Dakota, South Dakota, Iowa, Kansas, Nebraska, and Oregon. All of our members own and operate dairy plants. The bulk of these plants manufacture dairy products such as butter, cheese, and nonfat dry milk. In addition, about 40 of them handle milk for fluid consumption in city markets. We are quite concerned that if this bill is enacted without proper safeguards, it will operate to the disadvantage of dairy farmers and the dairy industry in this country, increase the already burdensome costs of the dairy price-support program, and will destroy the import control mechanism authorized in section 22 of the Agricultural Adjustment Act which was designed to protect price-support and income-enhancement programs for dairy farmers from large imports of dairy products. We do not need any reduction in tariffs or any relaxation of currently effective import-control programs under section 22 in order to assure our population of adequate supplies of milk and dairy products. The production of milk and dairy products in the United States is running far beyond the volumes that our population will consume at anything remotely approaching adequate returns to dairy farmers. For years Congress has recognized this position and has maintained a price-support program for milk and butterfat, under which significant volumes of the products of milk and butterfat are removed from commercial channels of trade and distributed principally through noncommercial outlets, primarily relief channels both here and abroad. Currently, purchases of price-support dairy commodities are running at very high levels so high that on March 30, 1962, the Secretary of Agriculture reduced price-support levels to 75 percent of parity for the marketing year beginning April 1, 1962. From the foregoing, it should be obvious that any action designed to increase the importation of dairy products into the United States merely will increase the cost of price-support operations in this country. Except for certain foreign types of cheese, the United States has never been an important importer of dairy products. In fact, it has been necessary to curb imports through a system of quotas in order to keep this country from being flooded with imported dairy products which we do not need in this country and which, under our price-support program, would merely have added to the volume of dairy products purchased by the Government. All during the history of import quotas, various devices have been used to circumvent such quotas, such as varying the sizes of cheese imported, of importing butter oil—and when this latter was placed under quota, mixing flavoring ingredients and sugar with butter oil to escape quota. It would serve no useful purpose to list in detail the many actions taken through the Tariff Commission to make the quota system, designed to protect our price-support prograin for U.S. dairy farmers, effective. Imports of dairy products, other than the foreign types of cheese imported. do not represent the type of imports that would take place in a normal situation. They represent imports on a strictly opportunistic basis. Unless controlled, they will take place in large volume due to the fact that our market prices, as a result of the price-support program, are very materially in excess of prices in exporting countries plus ocean freight and tariff. The need for maintaining strict import controls on dairy products in order to protect the price-support program conducted by the U.S. Government for dairy farmers in this country is evidenced by the very large world trade in dairy products. Normally about 1 billion pounds of butter and about a billion pounds of cheese move in international commerce each year, as well as large volumes of nonfat dry milk. If, through the operations of the Trade Expansion Act of 1962, import controls are weakened or abolished, a large portion of the world trade in butter, cheese, and nonfat dry milk will be shipped to the United States in order to secure the relatively high prices guaranteed by our Government under the price-support program. Once having secured such imported volumes. or U.S. commodities in an equivalent amount that would be displaced by such imports, we would then have a much more serious problem of disposition of the purchased commodities than we have at the present time. The U.S. Government is already experiencing great difficulty in disposing of current surpluses. particularly of butter, and is endeavoring to dispose of a large volume of surplus butter in foreign disposition channels at this time. This problem, as well as the cost of operation of the price-support program, would be vastly increased by any relaxation of our import control system. In view of the foregoing, we believe the authorities requested by the President in H.R. 9900 should be carefully circumscribed so as to make it mandatory upon the executive branch not to interfere in any way with import control systems necessary to the proper functioning of the price-support program for U.S. farmers. We feel it necessary that such restrictions upon the authority of the President and the executive branch be spelled out in the legislation. We appreciate the opportunity of furnishing you this statement. The Honorable WILBUR D. MILLS, House of Representatives, Washington, D.C. HOUSE OF REPRESENTATIVES, Washington, D.C., January 26, 1962. DEAR MR. CHAIRMAN: Enclosed please find letter and resolution sent to me by Frank Coleman, general manager, Blue Ribbon Growers, Inc., Yakima, Wash. This resolution asks that in consideration of the President's requested new authority in negotiating foreign trade agreements, as embodied in H.R. 9900, a provision be included for adequate alternatives for flexibility and timely relief so as to safeguard our domestic agricultural producers in the event of unreason. able or unfair competition from abroad. I feel that this is certainly a most reasonable request, and therefore I ask that the Committee on Ways and Means actively consider the resolution of Blue Ribbon Growers, Inc., and that my letter and the attached correspondence and resolution be made a part of the hearing record of H.R. 9900. Sincerely yours, CATHERINE MAY, BLUE RIBBON GROWERS, Yakima, Wash., January 15, 1962. The Honorable CATHERINE MAY, Washington, D.C. MY DEAR MRS. MAY: At our regular board of directors meeting on January 11, 1962, the attached resolution was adopted which we respectfully submit for your consideration. Our organization is vitally interested in maintaining the strongest position on the export of the various fruits we handle as well as the effect that imports might have on the production and orderly marketing of our produce. We feel strongly that legislation which may be adopted to continue or replace the present Federal Trade Agreements Act should provide adequate means for obtaining quick and effective relief in the face of unreasonable or unfair competition from abroad. We are mindful of some of the ramifications in the present trend toward freer trade between countries and the important effect this can have on the relationships between nations. We do feel, however, that adequate alternatives should be provided for flexible and timely relief so safeguards may be unquestionably available to agricultural producers should this be obviously needed. We have also sent letters to Secretary Freeman and Senators Magnuson and Jackson. Please advise if you feel it would be in order to send copies to any others. Sincerely yours, FRANK COLEMAN, RESOLUTION OF BLUE RIBBON GROWERS, INC., YAKIMA, WASH. Whereas proposals to replace the Federal Reciprocal Trade Agreements Act which expires June 30, 1962, include proposals to drop or narrowly limit the present peril point and escape clause provisions of the present act; and Whereas it is essential that American industries which must depend upon fair opportunity to compete in their domestic markets be provided with reasonable safeguards against destructively excessive imports, such as are intended to be provided by the present peril point and escape clauses: Now, therefore, be it Resolved, That this, the Blue Ribbon Growers, Inc., a Washington cooperative association of fruitgrowers within the State of Washington at its regular board of directors meeting, January 11, 1962, urges that any legislation which may be adopted to continue or replace the present Federal Trade Agreements Act shall include adequate means whereby a domestic industry which is threatened by serious injury by reason of excess imports may present its case before an impartial agency, such as the U.S. Tariff Commission, and obtain quick and effective relief, and that for the purpose of such proceedings the growers of any agricultural product used in the manufacture of a commodity involved in such a proceeding be considered a part of the domestic industry producing that commodity, so that the safeguards shall be unquestionably available to agricultural producers; and Resolved. That inasmuch as other nations, including members of the European Common Market organization, are continuing to impose import quotas, and periodical limitations, upon American fruit and other products, in addition to their legislation should expressly reserve and implement the freedom of the United States to utilize import quotas when such are found to be necessary to provide reasonable and adequate protection of American industry; and be it further Resolved, That copies of this resolution be furnished to Senators and Members of Congress from the State of Washington and to other interested persons. HOUSE OF REPRESENTATIVES In re H.R. 9900 Hon. WILBUR D. MILLS, Chairman, Committee on Ways and Means, House Office Building, DEAR MR. CHAIRMAN: The enclosed communication sent to me by Mr. Benjamin Reynolds, Green Valley Farms (engaged in the growing of mushrooms), Avondale, Pa., is forwarded for your consideration in connection with H.R. 9900 now before your committee. You will note that Mr. Reynolds and the cosigners of his communication, Mrs. Emma Lattanzio and Miss Sue DeCecco, also of Avondale, protest to the lowering of tariffs on imported mushrooms and further recommend that a moderate quota be established on such imports. I would respectfully ask that Mr. Reynolds' letter be included in the printed hearings. Sincerely, PAUL B. DAGUE. GREEN VALLEY FARMS, Avondale, Pa., March 27, 1962. The Honorable PAUL B. DAGUE, Washington, D.C.: Realizing the serious plight which the mushroom industry would suffer if trade tariffs were lowered on mushrooms and further realizing the mushroom industry is the largest agricultural business activity in Chester County, we cannot help but register our strongest protest against such action. Already foreign imports of mushrooms have created serious competition in this area. Presently there are over 10,000 persons employed in the mushroom industry and the livelihood of an additional 50,000 persons depends on this same industry in Chester County, the "Mushroom Center of the World." Lowering trade barriers on this product would bring chaos to this community and create a totally distressed area. We committeemen of New Garden Township appeal to you to register at the House and Ways Committee hearings our firm protest in regards to the lowering of the tariff on imported mushrooms, and we would further recommend that a moderate quota be established on such imports. Yours truly, Mrs. EMMA LATTANZIO. STATEMENT OF E. W. GAUMNITZ, EXECUTIVE SECRETARY, NATIONAL CHEESE INSTITUTE, INC., AND AMERICAN BUTTER INSTITUTE, INC. This statement is submitted on behalf of the National Cheese Institute, Inc., and the American Butter Institute, Inc. The members of the National Cheese Institute produce over 50 percent of the cheese manufactured in the United States and handle over 75 percent of the cheese handled in the United States. The members of the American Butter Institute manufacture over 25 percent |