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Y4.SMI: G 76
EXPORT GRAIN SALES
SUBCOMMITTEE ON SBA AND SBIC AUTHORITY
Printed for the use of the Committee on Small Business
WASHINGTON : 1979
COMMITTEE ON SMALL BUSINESS
NEAL SMITH, Iowa, Chairman TOM STEED, Oklahoma
JOSEPH M. McDADE, Pennsylvania JOHN D. DINGELL, Michigan
SILVIO O. CONTE, Massachusetts JAMES C. CORMAN, California
J. WILLIAM STANTON, Ohio JOSEPH P. ADDABBO, New York
WILLIAM S. BROOMFIELD, Michigan FERNAND J. ST GERMAIN, Rhode Island TIM LEE CARTER, Kentucky PARREN J. MITCHELL, Maryland
DAN QUAYLE, Indiana HENRY B. GONZALEZ, Texas
DAN MARRIOTT, Utah JAMES M. HANLEY, New York
TOBY ROTH, Wisconsin JOHN J. LAFALCE, New York
LYLE WILLIAMS, Ohio BERKLEY BEDELL, Iowa
OLYMPIA J. SNOWE, Maine FREDERICK W. RICHMOND, New York DOUGLAS K. BEREUTER, Nebraska MARTY RUSSO, Illinois
ED BETHUNE, Arkansas ALVIN BALDUS, Wisconsin
ARLEN ERDAHL, Minnesota
THOMAS J. TAUKE, Iowa
THOMAS G. POWERS, General Counsel
SUBCOMMITTEE ON SBA AND SBIC AUTHORITY AND GENERAL SMALL BUSINESS
NEAL SMITH, Iowa, Chairman
DAN MARRIOTT, Utah
TOBY ROTH, Wisconsin
ED BETHUNE, Arkansas
Dr. JOHN W. HELMUTH, Chief Economist
EXPORT GRAIN SALES
MONDAY, JUNE 11, 1979
HOUSE OF REPRESENTATIVES,
COMMITTEE ON SMALL BUSINESS,
Washington, D.C. The subcommittee met at 10 a.m., pursuant to notice, in room 2359-A, Rayburn House Office Building, Hon. Neal Smith (chairman of the subcommittee) presiding.
OPENING STATEMENT OF CHAIRMAN SMITH Mr. SMITH. The meeting will come to order. Other members are on the way. We will start the hearing.
The House Small Business Committee is today examining problems in the export grain sales reporting system which have been brought to our attention.
There are inequities in the system which are causing undue burdens on the small producer and processor.
Under current export sales reporting requirements, only U.S. firms must report sales to USDA within a limited period. Otherswhich include foreign firms, foreign affiliates of U.S. firms and foreign firms with U.S. affiliates-are not compelled to report sales.
At least we don't have any way to require them to do so.
So what is happening now is that many large domestic companies avoid our reporting requirements by having a foreign affiliate make the sale. In other instances, export business is not reported because it is channeled through foreign firms.
Over a period of years we have had examples where foreign state trading companies have bought large amounts of grain and for weeks have delayed filing any reports. During this time, they have had the opportunity to run their purchases through our futures market and, with inside trading information, guaranteed a low fixed price prior to the time producers and processors in this country were aware of any worldwide change in demand. This results in our farmers selling their grain at prices which do not yet reflect the new increased demand.
Thus, the small businesses in this country are paying the difference between the fixed price contract and the real value of the grain. If our producers and processors have available to them the same information as large international trading companies, they could also have the opportunity to make more accurate marketing decisions.