In this regard, the Association wishes to point out that the United States, Canada and Mexico together produce about 123 million ounces. When one considers that the balance of the Western Hemisphere supplies an additional 52 million ounces of new production making a total of about 175 million ounces against an annual current demand of 165 million ounces in the U. S., it is evident that this raw material would be easily accessible in an emergency. The cited production does not include silver recovered in the U. S. annually from coins and other forms of usable scrap which in 1977 was estimated at some 72 million ounces. The National Security Council has determined that there is no requirement for stockpiling silver, The amount currently in the stockpile-140 million ounces-is surplus to defense needs. It should be noted that other stocks in this country could become available for extreme emergencies not contemplated in the plans, such as: - 39 million ounces in the Treasury stocks for coinage 34 million ounces held by industry - 6 million ounces in Defense Department stocks for contracts with government furnished material provisions - 133 million ounces in COMEX and Chicago Board of Trade warehouses An estimated 250-900 million ounces in 90% U. S. silver coins held An undetermined amount of silver in ingots held as investments by citizens. Attachments: 1. U. S. Industrial Consumption (1973-1977) 2. 3. World Silver Consumption and Supplies (1973-1977) Industry Stocks (1967-1977) Mr. FRANKLAND. I am Walter L. Frankland, Jr., executive vice president of the Silver Users Association Inc., with offices in Washington. We appreciate, Mr. Chairman, the opportunity to appear today to express the views of the members of the Silver Users Association regarding the various legislative proposals for the strategic stockpile. By National Security Council criteria, 140 million ounces of silver have been declared surplus to defense needs. With the high current market price for silver, $5 per ounce-I don't know whether it is higher than that, now that the market is open-the sale of Government silver would mean increased revenue to the Treasury, benefiting all taxpayers and could reduce the budget deficit. Government silver made available to the market would meet a portion of domestic requirements, thus lessening the need for imports. Additional supplies to the market of usable metal would be in the best interests of millions of Americans who consume products using silver-photographic, electrical, silverware, and medical and dental supplies. In keeping with the current stockpile law which requires silver surplus to defense needs to be returned to the market, the association believes that now is the time for the Congress to act in carrying out its responsibility. We advocate that the disposals be made in a manner comparable to the sales conducted by the General Services Administration during the period 1967-70. We suggest that weekly auctions be in amounts between 500,000 ounces and 1 million ounces. At current prices, a sale of the entire stock of Government silver would mean a profit of some $500 million. Concerning S. 1810, a stockpile bill related to imports offered by Senator James McClure, we urge subcommittee members to amend the procedure so that accessibility of commodities largely available from the Western Hemisphere, especially Canada and Mexico, is clearly recognized. We find that when relying upon import-dependency with no consideration of proximity and accessibility of the imports, stockpile levels appear distorted, unrealistic and too costly to the taxpayer. Although silver is the commodity which has clearly demonstrated what one could label as a weakness in the concept, many other commodities are also available from the Western Hemisphere, especially Canada and Mexico. SUA firmly believes that applying the amount of any commodity available from the Western Hemisphere, especially Canada and Mexico, as an offset to the gross import deficit to determine the stockpile level, is a logical and acceptable procedure should the Congress choose to depart from the methodology adopted by the present interagency stockpile committee. From statistics available to SUA, when Western Hemisphere silver is considered, 2-year stockpile goals would be 4 million ounces. Offsets of silver from Canada and Mexico, only, could mean a 2-year level of 40 million ounces, if the McClure bill were adopted. To this end, Mr. Chairman, SUA would offer an amendment to section 2 of S. 1810-and it begins on page 3 with line 15 through 24. That is the portion of that bill which defines how the stockpile objective |