sugar from all parts of the world and induce plantings in some countries; however

3. It is not believed that decontrol would create more sugar for 1947 because: (a) The actual increase in the supply of beet sugar is about offset by the loss in Hawaiian sugar caused by the strike.

(b) The Philippines, which normally supplied approximately one-seventh of the United States sugar requirements, are not yet self-supporting.

(c) Java, which was a normal source of supply for about 2,000,000 tons annually, has been so affected by the war and civil strife so that any quantity of sugar from this source is most unlikely.

(d) Grinding of the Cuba cane will be completed in the near future which fixes the amount obtainable from that source for 1947.

(e) The Food Industry Council report indicates that with controls, the distribution inventories have been reduced about 400,000 tons below prewar average. In addition, primary distributor stocks were reduced a similar amount.

Under decontrol, these stocks would of necessity be rebuilt to provide proper distribution flow. This would account for the better part of 1,000,000 tons of sugar being immediately withheld from the consumer. Such would not be necessary under continued controls and when the sugar supply increased,. this would not present a problem.

As to increased plantings, it is our understanding that the plantings are being increased in most producing areas, but sugar from such increased plantings will not help the home canner, the housewife, the industrial users until after 1947. 4. Any gains in sugar supply due to price controls would be offset by problems caused by runaway prices. Based on results of soaring sugar prices after the First World War, the problems would be:

(a) Price rises of sugar: In 1919 sugar was pegged at about 9 cents; decontrol became effective a year after the armistice, on December 5, 1919; prices started up, and by June 1, 1920, it reached 26 cents a pound. Before 1920 ended, prices slid back to about 8 cents and by 1921 had dropped to 5 cents, going to 32 cents by 1932.

(b) The rapid rise after the last war caused numerous lawsuits that hung on for years. There were lawsuits between refiners and importers against customers and by importers against banks.

(c) It caused failures and financial difficulties in the United States, Cuba, and elsewhere among grocers, manufacturers, banks, exporters, importers, raw sugar mills, and others. Many bottling plants closed, never to open again.

5. If sugar control is removed, a few important buyers will get the sugar. It is urgent that your committee extend the sugar controls as soon as practicable so that everyone concerned with sugar will know what to expect.

ASSOCIATED RETAIL BAKERS OF AMERICA,
Chicago 14, Ill., February 26, 1947.

The Honorable RALPH E. FLANDERS,

Chairman, Sugar Subcommittee, Committee on Banking and Currency,

Senate Office Building, Washington, D. C.

DEAR MR. CHAIRMAN: Because of circumstances which prevent a personal appearance at your hearing tomorrow on sugar control extension legislation, including Senate Joint Resolution 58, we respectfully ask leave to enter this written appearance and statement, on behalf of the more than 22,000 manufacturing neighborhood retail bakers in America.

We are convinced that extension of price allocation and rationing controls over sugar for a reasonable time is in the best interest of those retail bakers as well as of the consumers they serve and the general public.

That is, we agree with the conclusion of the sugar committee of the Food Industry Council that premature decontrol of sugar while supply is so greatly below demand would be disastrous, although we believe that controls should be removed as soon as the relationship between supply and demand will permit. We are especially interested in a reasonable extension by Congress of sugar control authority because retail bakers, while numerous, are individually relatively small buyers and generally do not buy sugar directly from refiners. Previ

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ous experience tells us that if sugar decontrol were to occur under circumstances as they now are, retail bakers generally would suffer as compared with large and direct buyers in securing supplies, in addition to the damaging effects of predicted sharp rises in sugar prices.

Respectfully,

FRANK G. JUNGEWAELTER,
Executive Secretary.

STATEMENT SUBMITTED BY HAROLD O. SMITH, JR.

(Transcribed from long-distance telephone conversation, 4: 30 p. m., February 26, 1947, received by Harold O. Smith, Jr., vice chairman, Industrial Sugar Users Group, United States Chamber of Commerce)

With respect to the matter of extending controls on the price of sugar, I wish to state that in principle we are opposed to continuation of wartime controls. However, because we are in a period when the public is quite sensitive to food prices, we feel the timing would be better to remove the controls toward the end of 1947 or early in 1948. Therefore, we support the committee in asking for a continuation of controls on sugar.

ASSOCIATED GROCERY MANUFACTURERS OF AMERICA,
Mr. PAUL S. WILLIS, President.

(Thereupon, at 4:35 p. m., the committee recessed until Monday, March 3, 1947, at 9:30 a. m.)

SUGAR CONTROL

MONDAY, MARCH 3, 1947

UNITED STATES SENATE,

SUBCOMMITTE OF THE COMMITTEE ON

BANKING AND CURRENCY,
Washington, D. C.

The subcommittee met at 9:30 a. m., pursuant to adjournment, in room 301, Senate Office Building, Senator Flanders (chairman of the subcommittee) presiding.

Present: Senators Flanders (chairman of the subcommittee), Bricker, McCarthy, Maybank, and Sparkman.

Senator FLANDERS. The meeting will come to order.

We are continuing hearings on the Senate Joint Resolution 58, with regard to continuing the controls on sugar under certain conditions. This morning we have first a list of opponents of the bill to be followed in time with any remaining proponents.

The first witness to be called will be Miss Elizabeth A. Smart, representing the National Women's Christian Temperance Union.

STATEMENT OF MISS ELIZABETH A. SMART, NATIONAL WOMAN'S CHRISTIAN TEMPERANCE UNION, WASHINGTON, D. C.

Miss SMART. I am not an opponent of the bill but I am suggesting an amendment.

Senator FLANDERS. That barely lets you in under the wire.

Miss SMART. I do not wish to take unfair advantage in any way. 1 am Miss Elizabeth A. Smart. My address is 100 Maryland Avenue NE., Washington 2, D. C. I am representing the National Women's Christian Temperance Union.

The National Woman's Christian Temperance Union consists of some half a million members, the largest proportion of whom are housewives. We have twice made a survey of shortages of sugar in this country in response to appeals from many women, of whom some were not members of our organization. In each instance we found that, while in some localities conditions might be better than in others, over practically the whole country there existed shortages of sugar so serious that even during the war emergency which required the utmost conservation of food, housewives were obliged to abandon home canning of fruit to a large extent, or to can without sugar-a process which was not always successful, and which required further sugar when the time to use the fruit came. Last fall in view of all these difficulties, a lot of fruit came on the market which they did not even attempt to can.

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It is the feeling of the women whom we represent, based on a somewhat bitter experience, that the complete, removal of food controls will only result in the buying up and hoarding of sugar and sirups by nonessential users with long purses and that the situation so far as they are concerned will not be greatly improved.

I refer to the fact that from July 1, 1945, to December 31, 1945-a period which includes the canning season, or part of it-brewers used 120,032,327 pounds of sugar and sirups; and from July 1, 1946, to December 31, 1946, 125,895,601 pounds, an increase of about 6,000,000 pounds over 1945. During the year from July 1, 1945, to June 30, 1946, they used 225,565,879 pounds of sugar and sirups. These figures are derived from Treasury releases, made from figures which the brewers are required to furnish to the Treasury Department every month.

In any calculation regarding sugar, the importance of sirups ought not to be disregarded. They can be made use of by housewives as sugar substitutes, or where not available for their use, can be used by commercial sugar users to release sugar and sirups adaptable to household use.

We believe that a reasonable stock pile of sugar to meet possible shortages in future years ought to be a part of the Nation's over-all planning on the sugar situation. There is no guaranty even that we might not have to meet war conditions again in the near future. We are also opposed to any policy which would sacrifice the physical recovery of the tragic populations of Europe to a nonessential indus try here. Aside from the sheer dictates of Christian humanity, we ⚫ can never build a stable structure of world peace or of domestic security on ignoring the desperate plight of the people on that unhappy continent.

While the prices on food in this country have improved greatly, they are still so high as to make it a matter of economic necessity in lower income homes for housewives to conserve all the fruit possible by canning it for winter consumption.

We approve the bill in principle. We think it might be strengthened by a specific provision in (2), lines 7, 8, and 9 on page 2 to the effect that in making such allocations, housewives and essential industries shall be preferred to brewers, who are nonessential users, and that all allocations of sugar to such nonessential users may be suspended during the continuance of the emergency. Respectfully submitted.

Senator FLANDERS. Your testimony, then, so far as support in general of the thing is confined to this suggestion as to the amendment? Miss SMART. Making it more definite that it would be possible for the Department of Agriculture to completely eliminate the use of these nonessential users if the emergency justified.

Senator FLANDERS. Now, referring to brewers, do you know in what form the brewers make use of sugar or sirup? I suppose the malt comes under that category.

Miss SMART. The malt comes under grain. There are sorghum grains employed by the brewers which I believe are also sometimes used for sugar. Of course, all grains can also be converted into

sugar, so that to some extent the amount that they eliminated from the potential sugar market is much greater than that amount of sugar. Senator FLANDERS. I suppose as a matter of fact they are converted into sugar in the process of being made into alcohol but do you know whether or not under that process they come under sugar control in the law?

Miss SMART. Grain itself, I do not think so. There have been special bills passed by Congress permitting some of these alcohol plants to stop their fermentation processes in the making of sugar so as to provide sirups for commercial use, I believe.

Senator FLANDERS. Have you any questions, Senator McCarthy of this witness?

Senator MCCARTHY. Just one.

You refer here to the plight of the people on that unhappy continent. You understand, of course, there is no relationship between rationing and allocation?

Miss SMART. You mean that this bill deals with rationing only? Senator MCCARTHY. Yes and this has nothing to do with allocation of sugar.

Miss SMART. I realize that that is true but I did not know but what it might be an argument used by the other side for releasing controls. I know that that has been suggested, that we are sending a lot of sugar to Europe and therefore we ought to have enough here so we could release controls. That is the reason I inserted that statement. Senator MCCARTHY. No further questions.

Senator FLANDERS. Mr. Maybank?
Senator MAYBANK. No questions.
Senator FLANDERS. Mr. Bricker?

Senator BRICKER. No questions.

Senator FLANDERS. The next witness will be Mr. Murray, representing the West Palm Beach Coca Cola Co., Miami.

Mr. Murray?

STATEMENT OF WILLIAM E. MURRAY, THE PALM BEACH COCA COLA CO., WEST PALM BEACH, FLA.

Mr. MURRAY. Mr. Chairman, I am William E. Murray, representing the West Palm Beach Coca Cola Bottling Co., of West Palm Beach, Fla.

We are in a rather peculiar position this morning. We are not opposed to continuation of the sugar rationing. As a matter of fact, under the present world sugar situation, we are in favor of having the administration of the program turned over to the Secretary of Agriculture.

There is only one part of this resolution that we object to, and on that paragraph as it now stands we find ourselves in violent disagreement. We refer to the all-inclusive language of paragraph (b) of section 3 on page 3.

Our basis for this disagreement is the result of a conflict with the OPA for over one year in the efforts to get a fair adjustment of our sugar base.