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EXPLANATION OF FOOTNOTE 6

CHARLES CHRISTIAN

Records from my 1100 acre semi-irrigated farm in Floyd County, Texas, concerning cattle bought April 4, 1977, and sold November 30, 1977.

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Due to the voluntary conditions of our 1977 farm bill that are imposed upon the farmer, it is economically unfeasible to continue operations as a diversified farmer and rancher.

VERNIE MOORE

Records from my 2800 acre irrigated farm in Floyd County, Texas, concerning my livestock operation for 1977.

25 cows calves plus 20 springer cows at a cost of

Vet supplies‒‒‒‒

3 of pasture rental to landlord_.

Total cost___

Sale price-‒‒‒‒

Net loss..

--

$12, 200.00 40.00 224. 44

12,934. 44 10, 774. 44

2, 160.00

This does not include labor, or my share of the pasture land, freight of this particular herd of cattle.

Due to this loss and present livestock conditions, I do not plan any future cattle operations.

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Herbicide and insecticide (1 quart 4# methol and 1⁄2 pint 6# ester) -- 5.25 Harvest (15 bushels) :

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These figures include no living expense, land costs, or payments, interest on equipment, or insurance.

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These figures include no living expenses, interest on equipment, or insurance.

29-974 O 78 19

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1 142.5 bu per acre at 15.5 percent moisture at $1.87 per bushel.

$267.33 285. 54

18. 21

Figured with operator as owner, no land payments, interest on equipment, crop insurance or living expenses.

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These figures include no living expenses, land costs or payments, interest on equipment or insurance.

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These figures include no living expenses, land costs or payments, interest or equipment or insurance.

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These figures include no living expenses, land costs, interest on equipment, or insurance.

STATEMENT OF J. STEPHEN GABBERT, EXECUTIVE VICE PRESIDENT, THE RICE MILLERS' ASSOCIATION, ARLINGTON, VA.

In connection with the Committee's March 7, 1978 hearings involving rice, we submit the following statement on behalf of members of The Rice Millers' Association (RMA). Founded in 1899, the RMA is one of our nation's oldest agricultural trade organizations. Members are located in Arkansas, California, Louisiana, Mississippi, and Texas. Membership consists of independently-owned and farmer cooperative-owned rice milling firms. The Association's main office is located in the Washington, D.C. area. A representative is maintained in Thailand. After much debate and division, target price legislation was passed for rice in February 1976. The new rice legislation applied to the 1976 and 1977 rice crops. It was a dramatic change from the previous program of acreage restrictions and high price supports. In 1977, target price legislation for rice was incorporated with little change under its own title in the 1977 omnibus farm bill.

HOW RICE HAS FARED UNDER TARGET PRICE

In 1976, CCC acquired about 19.1 million cwt. of 1975 crop rough rice. This was produced under the old high price support program. 1976 was the first year under target price. Farmers responded to large supplies by reducing 1976 rice acreage by 10 percent. All of the 1976 rice crop subsequently was marketed. In 1977, CCC acquired an insignificant 11,000 cwt. of 1976 crop rice. Only 65,000 cwt. was placed under the reserve program. During 1976-77 over 23.0 million cwt. of rough rice was placed under loan and redeemed. During the period August-December 1976 the average farm price received was below the established target price. The target price program assisted eligible rice farmers who needed help by providing deficiency payments.

In 1977 rice farmers further reduced acreage by twelve percent. This represented a 22 percent decline over two years. Bad weather caused an additional production reduction of about 20 percent. Consequently, 1977-78 rice prices doubled compared to 1976-77. No deficiency payments were required in 1977. It is now expected that the entire 1977 rice crop will be marketed and that a large portion of the 1975 crop taken over by CCC will be sold to the trade to meet export commitments. CCC will sell its rice stocks at a profit allowing the government to recover a significant portion of deficiency payments. The following table describes how rice under target price has been a success story:

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Exports are the lifeblood of the rice industry. Over sixty percent must be exported. The commercial portion of rice exports has steadily increased. In the early seventies cash export sales accounted for only about thirty-two percent of total rice exports. For the 1977-78 marketing year commercial export sales are expected to account for over seventy percent of total rice exports. This represents an all-time dollar export record.

TABLE II.-U.S. RICE EXPORTS BY CATEGORY FOR THE PERIOD 1971-78

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Rice prices are good. Rice exports are strong. The rice section of the current farm bill is working the way it should. We strongly urge the Committee not to include rice in any emergency measures that increase support prices for other commodities. Rice does not need it. Such action would be regressive, result in reduced exports, and put rice farmers back in the business of producing rice for the government.

We respectfully urge the Committee to consider the following progressive measures designed to increasing farm income:

1. The Secretary of Agriculture already has at his command a ready-made tool for increasing farm income. This is the PL-480 program. Bolstering farm income was the original objective for which PL-480 was designed. The Committee should reexamine the PL-480 program to determine if it is being administered properly and utilized as originally intended.

2. Consideration should be given to establishing bilateral commodity trade agreements with OPEC countries whereby the United States would agree in principle to provide minimum quantities of specific commodities over a multiyear period. Our farmers would benefit by a stabilized market demand. OPEC countries would have reasonable assurances of obtaining needed food supplies. Our farmers should be receiving a piece of the oil action. It is time that the U.S. had an aggressive and innovative agricultural sales policy.

3. A long-term CCC Export Credit program should be developed providing up to ten years of credit lines. This program would be another valuable export tool designed to increase exports and bolster farm income at no cost to the taxpayer.

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