Talk by President, Commodity
Credit Corporation at a meet*
ing of tke North Gwatttii
Farm Bureau Federation At
Greenvflle oa July 25th
It has now been almost two years
since the outbreak of the war in Eu
rope and more than a year since are
began our own defense preparations.
A great deal has happened during
this war period in Europe and this
defense period at home. In Europe
we have seen the Hitler war machine
crush through country after country
until it controls practically all of
continental Europe.
As the peoples of Europe have lost
their liberties, we have found it im
practicable in some cases,-and im
possible in others, to maintain nor
mal relations with them. One of the
results of this has been the loss of
markets for some of our important
products.* We have mamtained more
nearly normal relationships with the
people of the United Kingdom but,
due to the war, we have had a mark
ed increase in the demand for some
products going to the United King
dom and a substantial redaction in
the demand for other products.
Prior to the beginning of the war
less than 2 percent -of our farm and
industrial plant capacity and labor!
were devoted to national defense sqd
the production of war materials. At
present we are devoting something
like 18 percent of our total capaci
ties and energies to these purposes.
The production of defense and war
materials will soon equal the produc
tion reached at the close'of the last
world war.
In large part, up to this time,
both in agriculture and in other in
dustries, the increase in the produc
tion for defense needs has consisted
in taking up the slack. A large part
I of the increase inprtmaetias^nas
come from increases in employment
of labor and the use of partially idle
I plants and farms. There has been
I but little, if any, redaction in the
I production of any important line. In
many industries there have been sub
stantial increases in the output of I
I goods for ordinary civilian uses. To
I illustrate, sales of automobiles have
I been running 35 percent to 40'per
cent above a year ago, sales of re
frigerators and kitchen ranger from I
I 40 to 50 percent, and on the farm the I
I production q#-wheat, cotton and to- I
I bacco?products of which we have a
surplus?has been maintained at near
or above the level of recent years. I
I As we further increase the produc- I
I tion of war materials and of feed I
I products, such as meat, dairy and I
poultry products, we are going to I
have to make a reduction in the pro- I
I duction of our pod r.saantisl indus- I
I trial goods, such as automobiles, re
I frigerators, kitchen ranges, and of I
I our export farm crops of which we I
already have large supplies, such as
I cotton, wheat and tobacco. It is not
I in the long-time interest of the peo- I
I pie of this cuantiy to continue to I
I produce goods that are not urgently I
needed when the labor and ^materials I
I that are uaed in producing these I
I goods could be turned to something I
I else. It would be unpatriotic to con- I
tinue to produce these non-essential I
and surplus products.
When the war is over, there will
I will no doubt be a* increase in the
I demand, at least for a time, for cot- I
ton, tobacco and possibly wheat, but
we already have Urge reserve sup
plies^ these commodities. Supplies
of fine-cured tobacco in this coun
try are approximately 500 million
pounds above Qormal, supplies of
cotton 6 million bales above normal, I
and auppties of wheat 400 million
serve suppues nave aireaay ziueaowr
buil^i^onali ^ ^warehouses. ^The
land and some of the labor that have
been used in producing these surplus
farm crops are now needed- in fac
tories to.produce war materials and
on farms to increase the production
of dairy and poultry products, fats
and oils.
A redaction of 10 percent has al
ready been announced in the wheat
acreage for next year and. in my
judgment, the best long-time interest
of tobacco and cotton growers, of all
the people at this country, and of
the democracies generally requires
that a similar reduction be made in
the. acreage of tobacco and cotton
next year. There is no way of esti
mating the probable cost of continu
ing to produce commodities that are
?Toot needed if such production inter
feres in any way with the production
of articles and commfcities that are
needed. In the aid, a small differ
ence in ships or other war equipment]
or a relatively small quantity of!
food might prove to be tho deciding
factor in this conflict. It was never!
more* important than it is now for us
to think straight and use our resour
ces and energies 90 that they may!
contribute most to the job ahead off
In this country we have a more
productive farm plant than we have!
had at any previous time.'' Due to
the increased use of legumes and)
improved soil-building practices, crop
yields are 15 to 20 percent larger!
than they.were 10 years ago. How
ever, this improved farm plant can
serve the nation only by producing
the commodities that are needed at
this time. ?
flue-cured tobacco is the most im
portant crop in this area and the
markets will open shortly. In gen
eral the marketing program for flue
cured tobacco this year will be simi
lar'to that of last year. The Ira- J
perial Tobacco Company and the in-1
dependent dealers will make pur-1
chases on warehouse floors using tte
funds of and acting as agents for
Commodity Credit Corporation. On
the average, prices at which the ex
port grades will be purchased by
these agencies will be about 3 cents
above the prices of last year. In ad
dition, loans will be offered any pro
ducer or group of producers who ar
range for the grading and prizing of
their tobacco. Loans will not be
available on warehouse floors.
*. Present indications are that the
1941 crop will be near that of last
year and stocks in the hands of do*
mestic manufacturers do not appear j
to be any larger, if as large, as they'
were a year ago. Domestic consump
tion of flue-cured tobacco for the
year beginning July 1, is estimated
at 419 million pounds, as compared
with 390 million pounds for the year
just closed,. consequently- 'domestic
manufacturers, if the crop meets
their requirements, may take slight
ly more of this crop than they took
of the 1940 crop. However, inde
pendent -dealers may take less with
their own funds than they took last
year. Consequently the agencies us
ing the funds of Commodity Credit
Corporation would take a quantity
r? ^ ^i.1^) w^' -C V ^^ ^
United Kingdom which at the begin
ning of the war were sufficient to
last more than two yeare have been
greatly reduced. Exports to the
United Kingdom under the lease
lend program during the coming 12
months probably will almost reach
annual exports prior to the begin
ning of the war. There will be some
exports to other countries and total!
exports during the coming year may J
6xc66(i 800 million pounds# TIub? sm*
? ?P ?? ? ?? r -- mm*mm |f ?'???? p ^ i ?? y -?
ed to our domestic consumption,
would give us a total above 700 mil
lion pounds. Last year only 600 miH
lion pounds wave consumed in this
country and exported.
The crop this year probably will
not greatly exceed 700 million
pounds, thus stocks a year from now
probably will not greatly exceed and
they may be less than present stocks.
However, it does not appear that we
will export any considerable quantity
of tobacco to continental Eupore un
til the war is over and exports then
may not be maintained at pre-war
levels. Partly because of the short
age of ships and increased shipping
rates it is becoming more and more
difficult to ship tobacco to China
and Japan.
As already indicated, duo to the
needs for other products and a short
age of storage space, it. appears ad
visable to make a 10 percept redac
tion in the fibe-cured tobacco acreage
in 1942. It now appears that the
United Kingdom jnarket about which
so much has been' said during the
past 18 months, has not been im
paired to any great extent if the.
lease-lend program is continued- On
the other hand, present indications
are that the continental Europe mar
ket, which normally before the .begin
ning of the war took more than 60
million pounds annually, has been
lost, at least for the war period, and
there may be substantial losses in
other markets- <
However, it now appears that flue
cured growers can expect a total do
mestic and foreign market of around
700 million pounds annually during
the remainder of the. war period if
shipping lanes are kept opes to the
United Kingdom. If developments
are favorable for the British and
unless unforeseen developments oc
cur on other fronts, with, a 10 percent
cut in the fine-cured acreage nert
year the next change in acreage is
more likely to be upward than down
ward.
In conclusion, I want to emphasise
as strongly as I can the need for a
' " , j 1
sorted and pscksd ^ lots according I
(^Adequate light is needa^o the
sorting rooms so the leaf can be
seen clearly and graded accurately.
Tie the same kind of leaves into bun- ;
dies or hands, and have enough dif- .
ferent lots to cover the full range of \
quality, length, and color of the crop. ?
-tobacco if jpw grade will often '
I bring a fair price when It is proper- <
ly prepared, but even the best grade ? 1
on the market wont bring top price I
if it is mixed with inferior leaf.
Growers who- have more leaf than {]
they can sell tax-free will find it
pays to sell their best leaf first, and i]
pay tax only on the lower priced to-1
bacco, as the higher thd price, the I
higher the tax will.he. However,
some growers with excess tobacco-I
are planning to buy extra marketing
quota cards from growers who del
not have enough tobacco to use up
the full amount of their cards. J
: * ? :,$M I
NOT SHORTER* ;
BUT LONGER
Wisner, Neb.?Don't let fear of
shortening your, days keep you from
the pleasure of using tobaced, is the
advice of Mrs. Luanda dine, this
place, who celebrated her 109th birth- j j
day this year.
She has been smoking for ninety-J
five yean, starting at the age of,
fifteen >to ease a toothache. . She
smokes a pipe almost constantly.
Her present pipe was the gift of an
admirer, who read about her in TO
BACCO several years ago. She in
sists upon a certain brand of tobac
co?Lowell.
I ? V " I ?? >W j]
?7-: ? *J3 *'r - ? -.V ? ? <- I
full realization of the tremendous 1
job that is ahead of us. In my judg
ment we have ?never before in- this t
country been confronted with a prob- J
tem that is going to require quite as j
much etagnising and -forking and -
pulling together as this one. During ,
the past two years we have,seen peo- ]|
pie in one country after another in <
Europe become slaves because they !
were not organized, ^because in some i
eases of differences of points of -
view within the country, and in brief, J
because they were not fully fitted ;
and prepared to neat the Axis pow
ers.
. .. ...
In this -country we have the oppor- ;
tunity to profit by these mistakes.
We are preparing to pit our resouisj;
oea, our organizational ability and
our liBg^o^uut jr against those of the I
Axis powers. We know that'we have J
greater resources than they have:
We believe that we are a more in
genious people Ahan are the people of
these countries. In dvil life we have
demonstrated that u&haye greater
organisational ability, but I will tell
you all of these must be applied to
m -- . " ? ~ y * ,
the task ahead of us. The odds are
ioaf and geM&aJob done. The leas
, Production is going to have to be}
? stepped up along many lines, prob
I
IJ are probably goiqf Ja have to make
sacrifices that none of us now know
I
bo jfioufats will make some mistakes! i
I we^ don't need,Jbut in such cases igjj
I gntil they have time to turn to the
production of products that are
1 ? - 1
| needed - 1 1
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