or perhaps chrome and where you have small deposits, you are going to have to do something on a blanket basis, are you not? Dr. BOYD. That is correct. Mr. CRAWFORD. And that is precisely the reason you are talking about the base floor for tungsten producers. Dr. BOYD. That is right. Mr. CRAWFORD. In other words, what you are saying to these fellows out here in the hills who go out into these little tungsten deposits, and they are small, they are not massive ore bodies, they appear in scattered places, any man who can produce at $63 will be paid $63, even though it falls below that and he will be paid for that for a period of 5 years. Dr. BOYD. That is correct. Mr. CRAWFORD. That is what you are saying? Dr. BOYD. Yes. Mr. CRAWFORD. That is the other limb of this thing. Dr. BOYD. Now, we would do the same thing for chrome, manganese, and perhaps on other metals, if we can get into them, probably more on a local basis in order not to alter the world market prices so as not to upset the whole market situation. We might go into area for chrome and set a price for production of chrome from that area and give the same kind of assurance of market for a period of years. Mr. CRAWFORD. I don't see any conflict between that and the observation of how it is working. Dr. BOYD. I don't think so at all. Mr. CRAWFORD. You have a $63 price on a given commodity at the present time, I understand. Dr. BOYD. That is right. Mr. CRAWFORD. We come back to the proposition submitted awhile ago, to the effect that anyone who can't operate within that $63 concept is out of the picture anyway, isn't he? Dr. BOYD. Not necessarily. If we need that material badly enough and in tungsten we do Mr. CRAWFORD. Wait a minute. I didn't make myself clear. If your floor is $63 and my costs are $672, how can I operate? Dr. BOYD. We will enter into an individual contract with you. Mr. CRAWFORD. Oh, no; I am assuming now that I am operating under a blanket. I am not in the individual contract. Dr. BOYD. But we put the blanket thing in to cover as many of these people as we can. Mr. CRAWFORD. So then, I would have, as an operator, the privilege of operating under the blanket or dealing specifically on the contract. Dr. BOYD. That is correct. Mr. CRAWFORD. I am trying to find out if there is anybody squeezed out of the picture, provided he can operate under the price set by the blanket provision or provided he can negotiate a contract with you which accommodates his situation. Mr. CRAWFORD. Either high cost, low-cost producer, or what not, everybody is covered, provided he can qualify. Dr. BOYD. Provided he can qualify and that the production at the exceedingly high prices is needed. There is a limit beyond which we cannot go because of financial problems. Mr. CRAWFORD. That is your contract. There would be a limit under the premium price, too, wouldn't there? Dr. BOYD. That is right. Mr. CRAWFORD. You don't go out to a man and say that you will pay $400 an ounce under the premium price. You have a limit within which you have to operate. Mr. BOYD. That is right. Mr. CRAWFORD. Let me repeat my question, because I want to see if I am clear on it. Any person who can qualify under your blanket provisions or under the provisions of the specific contract, is in a position to operate, is he not? Dr. BOYD. That is correct. Mr. CRAWFORD. Limited only by your appropriation. Dr. BOYD. That is right. Mr. CRAWFORD. I don't see any particular difficulty with that. The job is to have Congress make the appropriations and to have the taxpayers submit to those appropriations. Dr. BOYD. That is right. Mr. CRAWFORD. I yield to the gentleman from California. Mr. ENGLE. The difference in what we were talking about earlier this morning with respect to obtaining contracts and the discussion right now, is one of mechanics. If the operator out in the field can plow his way through this high-piled red-tape map here and get himself a contract, he is all right. The thing that we say is this: The Government should establish three or four propositions, first, they should say what they want, chrome, tungsten, manganese. They should set special cases on it, and they should set the price range within which they will buy it, say, copper, anything from 17 to 30 cents, and say to every miner in the country, "If you can get any of these materials meeting these specifications, within this price range, we will sit down and we will work out a program with you." That is what the premium price plan is. Every man out in the field who can fall within that range knew that. The difference in mechanics is that what they have set up here is a selective contracting system where some little miner sitting on a peak out in Colorado has to Some way or another engineer a contract through this mile-high stack of red tape and they just don't get the job done. It is the difference in mechanics, not a difference in objective or in fundamental principles. Mr. CRAWFORD. This gentlemen you have referred to, Mr. Engle, isn't up against any tougher proposition than the fellow who manufactures agricultural implements in my district is up against when he wants to get a price at which he can sell his stuff from the price-control machinery down here. Mr. ENGLE. He is, Mr. Crawford, because Mr. CRAWFORD. I don't think so, because I have been 3 months now, January, February, March, going into April, trying to find out at what price a man can sell his farm machinery and here the seasons are overtaking and we are approaching Christmas. I am not blaming the departments because the departments have had to sit down here with a limited personnel and say what shall be the price on 10,000 different propositions and he is simply falling in line awaiting the day when they will tell him at what price he can sell. In the meantime, his customers are not being supplied, and, in turn, the farmers are not able to buy the machinery. We are dealing with Government controls, controlled economy, and I will bet you dollars to doughnuts you will never eliminate these delays and red tape. Mr. ENGLE. You will never get rid of them all. Mr. CRAWFORD. You won't get rid of one-tenth of them. Mr. ENGLE. But the difference between the farmer who is dealing with standard equipment and the prices of beans and things like that, is this. Each miner has a difficult problem on his mind, he has different grade ore, he has different transportation problems in getting his ore in and out and all of those things, and he has to negotiate a contract on his particular mine involving all of those particular problems, whereas, your farm-machinery man is dealing with John Deere tractors and he is dealing with standard types of machinery. What I am saying is that the difficulties of the miner are immensely greater. Dr. BOYD. You don't think we have any difficulty working it out? Mr. REGAN. We have about 5 minutes before the House convenes at 12 o'clock. I spoke to the Speaker yesterday and he has given this committee authority to sit during their further armed services debate this afternoon if the committee cares to do so. I would like right now an expression from the committee before I recognize Mr. Saylor as to whether or not you would like to sit from 2:30 to 4 this afternoon to make some further progress in these hearings. Does the committee feel disposed to do that, or are there any -objections? Dr. BOYD. May I ask one favor of you? You have asked my staff to testify here. They have been sitting here for 2 days and the work of the program is not being carried on on that account. May I come in later? Mr. REGAN. I was going to make a suggestion on that, but I will be very glad to have your Dr. BOYD. I will be happy to be at the committee's disposal any time. Perhaps you would like to hear them first so they may go and I can come back and finish up. Mr. REGAN. That was the suggestion I was about to make, Dr. Boyd. that members of your staff might come this afternoon. It is obvious we are not going to complete these hearings in the 3 days set aside for them, and we will have to work out a program to complete the hearing sometime next week, so from your staff this afternoon I believe Mr. Lyon Mr. SAYLOR. I have just a few questions that I would like to ask. It won't take too long. Mr. REGAN. Dr. Boyd, suppose after Mr. Saylor asks you the questions he has been waiting for some time to ask, that we would not ask you or your staff to appear further until sometime a week or two hence when we might like to get some further information from your administration or staff. We apologize to all of your staff for having waited around, but we did like to have a nice audience. I think you have given us some very, very good information. We will then have the Price Admin istrator this afternoon instead of a further continuance of the Defense Minerals Administration, and we will call on you a week or two hence if we need additional information. Dr. BOYD. May I say I think these hearings have been very helpful to all of us to be here and see what Congress feels about these things. It does markedly guide us in our efforts. Mr. REGAN. That has been the sole purpose of these hearings, Doctor, to see if we can't make some progress in this matter that would be recognized as a complicated matter to work up for a defense effort for the small and large miner. Dr. BOYD. Thank you. Mr. REGAN. Mr. Saylor. MANGANESE, INC., CONTRACT DISCUSSED Mr. SAYLOR. Dr. Boyd, in looking over the letter from General Services Administration, with regard to the contracts which have been entered into, I notice that the contract with manganese at Henderson, Nev., was entered into on December 8, 1950, correct? Dr. BOYD. That is right. Mr. SAYLOR. And that contract does not go into effect until January 1, 1952, and extends until December 31, 1960? Dr. BOYD. That is right. Mr. SAYLOR. That contract is for production of manganese ore? Dr. BOYD. That is correct. Mr. SAYLOR. Manganese ore is one of the critical materials in this country. You have stated to Mr. D'Ewart that we have an adequate supply? Dr. BOYD. Current only. Mr. SAYLOR. Currently? Dr. BOYD. Currently. Mr. SAYLOR. From the report of Charles E. Wilson to the President dated April 1, 1951, he has on page 39 a map showing the United States dependency on imports of strategic materials and their principal sources. It shows that we are dependent for 92 percent of our manganese by import and that we get it from India, Gold Coast, and the Union of South Africa. Dr. Boyd, if this contract for manganese does not go into effect until January 1, 1952, and the world situation is half as bad as Speaker Rayburn said it was yesterday, are we not in a very critical condition with regard to manganese? Dr. BOYD. We have a substantial stockpile of manganese. The Henderson, Nev., contract was the first step in providing a secure source from domestic sources. It is only the first step. It will eventually be quite large. During the time that these projects, before they come into final operation, we have the stockpile to back us up and give us a reasonably secure position-I won't say completely secure. There are other projects and very large ones in the mill, which require further research on the metallurgical process involved and we are spending a great deal of money on that today ourselves and private industry, so that those projects will also come in at a later date, so that the stockpiling principle was to carry us over that period. If we were cut off from world sources, we had these stockpiles to carry us. 82354-52-9 Mr. SAYLOR. Doctor, is that stockpile which you refer to the Government stockpile, or is that private stockpile? Dr. BOYD. It is largely the Government stockpile. There are some private stocks, but the great bulk is in Government stockpile. Mr. SAYLOR. Do you feel that this source of supply at the ThreeKids mine which you have entered into a contract for will give us a fairly firm supply of manganese? Dr. BOYD. Just a small-the production of that would be in the neighborhood of 100,000 tons a year for only 7 years. We will be consuming, when the steel industry is expanded, close to 1,800,000 tons a year, so that is only a little part of what we have to do. Mr. SAYLOR. In other words, it is necessary that other sources of manganese and other contracts be entered into? Dr. BOYD. As rapidly as we possibly can. Mr. SAYLOR. And rapidly as possible? Dr. BOYD. Yes. FOREIGN MINERALS PROGRAM DISCUSSED Mr. REGAN. Mr. Donovan has a further question. Mr. DONOVAN. How much money is the Government pumping into mineral operations or mining in Portugal and east Africa, say? Dr. BOYD. None that I know of is paid in Canada. Mr. DONOVAN. Well, leave Canada out of it. How much was it? Dr. BOYD. I am sorry I couldn't answer that question off-hand. That is in the hands of the Economic Cooperation Administration. They probably could answer that question. Mr. DONOVAN. Can you make a guess? Dr. BOYD. I couldn't even guess. Mr. DONOVAN. Are those funds provided by the Government of the United States or private capital permitted by the State? Dr. Boyd. It is both, I would say. Some of that is currency as well as American dollars. Mr. DONOVAN. As to Turkey. Dr. BOYD. I might ask Mr. Mittendorf to answer that for you. He just came back from Turkey. He can give you the details. Mr. MITTENDORF. What was the question? Mr. DONOVAN. How much money does the Government of the United States at this time pump into the mineral operations in Turkey? Mr. REGAN. This is C. O. Mittendorf, Director of the Production Expansion Division, DMA. Mr. MITTENDORF. I asked the question of what he meant by mineral and whether or not he meant critical, nonferrous or if it went into any of the nonmetallics which are not of a strategic nature. Mr. DONOVAN. Answer it in both senses. Mr. MITTENDORF, The largest project that ECA has in Turkey pertains to solid fuels and that is coal. We were back of projects which totaled about $63 million, as I recall. Mr. DONOVAN. How much in east Africa? Mr. MITTENDORF. I couldn't say. I am from Turkey. Mr. DONOVAN. All right, that is all I want to ask you. I will ask Dr. Boyd. Mr. REGAN. Thank you, Mr. Mittendorf. |