TIMELY OUTLOOK DIGESTS OF A GENERAL NATURE

Timely digests of a general nature summarizing the highlights of the current situation are becoming increasingly popular in the outlook program. Most of these are issued monthly, a few weekly, and some bimonthly or quarterly. Many of them consist of a single sheet which can be quickly and easily read. These digests started as a service to county agents, but many have been expanded by popular request to include other people.

TIMELY OUTLOOK DIGESTS OF A COMMODITY NATURE

Many types of agriculture are specialized, and call for information of special interest to dairymen, fruit growers, poultrymen, livestock feeders, vegetable growers, cotton and wheat farmers, etc. To meet the demands of special interest, a number of States issue timely digests of a commodity nature. The frequency and timing depend on the nature of the commodity, and the marketing season. They are prepared primarily by the marketing economists as an aid to farmers in buying and selling. The volume is largely based on request, and the needs vary greatly with commodities.

FOOD COSTS AND CONSUMER INCOMES

Mr. WELLS. I want now to move to the factors which affect farm prices, in other words, what causes changes in farm prices and farm income. Since 88 to 90 percent of our farm products are consumed in American households, one of the major things we have to look at is the flow of consumer incomes. This fourth chart compares the flow of consumer incomes with food costs. It shows the average per capita consumer incomes of the American people by years, 1929 through 1952. We have then broken that income down into sections or segments. The first section is the personal income tax.

Mr. HORAN. That is tax?

Mr. WELLS. Yes; income tax, if you please.

Second, the chart shows estimated savings; in other words, what the American public saves, or does not save. And then the two bottom sections are estimates of consumer expenditures broken down into expenditures for nonfood items and expenditures for food items.

Consumer incomes bave increased as much or more than farm prices and farm incomes, despite the fact that consumers are now buying some 10 or 11 percent more food than they did in the 1935-39 period.

Mr. WELLS. Despite the fact that food expenditures have increased as I have indicated above they really represent no larger proportion of consumer incomes than before World War II, especially if you allow for the fact that consumers are buying 10 to 12 percent more food now and are buying more service with it at retail.

Mr. HORAN. May I ask a question of Mr. Wells?

Do you have that expenditure for food broken down into first, food itself and, second, the cost of distribution?

Mr. WELLS. Yes; I will talk about it in just a few minutes.

Consumer incomes in the United States are now at record level. I think they will continue to increase slightly during the first half of this year and will be high all year long unless qur businessmen borrow a depression from the future by psychological means this fall which I doubt. Secondly, I wish to point out that food expenditures are not an unreasonable portion of current consumer incomes.

MEAT PRICES AND CONSUMER INCOME

We have next taken total disposable incomes, what consumers have after income taxes, and compared them with estimated expenditures at retail for what we commonly call red meat-lamb, pork, and beef.

From 1920 to 1940 there is a very close relationship between consumer incomes and meat expenditures at retail. There is a distortion during World War II in this picture. Since about 1946 or 1947 there

is a reasonably good establishment of the old relationship. It looks to us, despite the drop in beef-cattle prices which hit stocker and feeder cattle last September and October, that the retail expenditures have been holding up. This has raised some questions as to what has been happening to retail prices for beef.

VALUE OF UNITED STATES FARM EXPORTS

In addition to the domestic demand, 10 to 12 percent of our products are sold in the foreign market.

This 10 or 12 percent may have a greater influence than that because if it comes back on our domestic market it creates a difficult surplus or market problem.

This sixth chart shows the value of United States farm exports, by fiscal years, 1910-52, with an estimate for fiscal 1953.

You will notice in the fiscal year 1952, we exported a little better than $4 billion worth of farm products, an alltime record. Our estimate for this year is about $3 billion.

COMMODITY EXPORTS UNDER FOREIGN-AID PROGRAMS

Mr. HORAN. Mr. Wells, how was that paid for, by foreign-aid funds? Mr. WELLS. Mr. Congressman, for the last several years I suppose that was roughly half of it. I could get the total for you that has been paid for by foreign-aid funds of one kind or another. I do not remember the exact percentages, but a very large block of it traces back to American foreign-aid funds.

Mr. ANDERSON. Can you put such a table or statement in the record at this point?

Mr. WELLS. I have estimates for the last several years as to the proportion of each of the major commodities financed by foreign aid.

Mr. HORAN. That is very necessary, Mr. Wells, because we have a clamor for more trade and less aid. I am very much for it, and so are you, but it is not going to happen, and I think if we can supply some information as to how these exports were paid for it would be helpful. Mr. WHITTEN. And, let us not overlook the military expenditures which might not be classed as foreign aid.

Mr. HORAN. Yes. If we can get that into the record it will be very useful to us and everybody interested in this matter.

Mr. WELLS. I can give you the direct figures in the record. I have no way of estimating how much military expenditures may have also supplied dollar exchange, indirectly.

Mr. WHITTEN. With the chairman's permission, I would like to urge that you make a note that this information is available.

Mr. WELLS. Yes. I shall analyze and include the international wheat arrangements in this.

(The matter referred to is as follows:)

Estimates of total United States exports of cotton, wheat, and tobacco and the proportionate quantities financed by foreign-aid funds are shown below. In appraising these estimates, attention is specifically called to the fact that they relate only to direct foreign aid-that is, these estimates do not include any quantities which might have been financed or shipped as a result of dollar exchange created by military aid or other grant funds which were not directly used for the purchase of agricultural commodities as such.

The above estimates include wheat shipped to India under a special program. The amount shipped was 71 million bushels and the value was $170 million. Practically all of this wheat was shipped in the July 1951-June 1952 year.

The above estimates do not include all wheat shipped under the International Wheat Agreement, but only that portion for which foreign-aid funds were used