15 years hence will be no more than third of the number in 1952. It seems probable that farmers may buy during the next 15 years an average of 100,000 tractors annually because of declining numbers of work animals. Thus, farmers would have to buy 345,000 tractors each year to maintain tractor and animal power on farms in 1951.

Some machines such as the field-forage harvester, automatic pickup baler, and power sprayer, are just coming into extensive use. Numbers of these and many other power machines and equipment will continue to increase.

Yearly depreciation of all machinery and motor vehicles on farms on January 1, 1952 was about $2.7 billion. An annual expenditure of this amount in terms of 1951 prices would about maintain the $15.3 billion value of machinery on farms on January 1, 1952. Additional expenditures will be required for additional tractors and tractor machines to replace work animals and horse-drawn machines.

I have here a table showing numbers of tractors and some of the more important machines on farms in 1942 and 1951, their age, and the estimated annual purchases needed to maintain the numbers.

Mr. ANDERSEN. We will insert that table in the record at this point. (The information referred to is as follows:)

Numbers, age distribution, and annual purchases of specified machines needed to maintain numbers on farms in 1951

1 Calculated by dividing January 1951 numbers of each machine by its estimated life.

Mr. WHITTEN. Many times factual information is given in such a way as to point out one side of it, which is unfortunate in many respects.

Mr. MARSHALL. I do not know how much longer, Mr. Chairman, we should pursue this subject. I think that we want to be careful that we do not allow our record to become too voluminous as far as some of these things are concerned.

Mr. ANDERSEN. Mr. Marshall, I think here you have asked a basic question and that is why we are holding hearings. I think the question is entirely along the lines we should proceed with. We have Mr. Wells and his organization here today. Take all the time you wish relative to any of these questions which mean so much to agriculture.

FARM MACHINERY: INVESTMENT, MAINTENANCE COST, DEPRECIATION

RATE

Mr. MARSHALL. Mr. Chairman, there are several things that I think are a bit interesting in this regard. I would like to know if the record could be supplied as to how much money, actual money the farmers in this country have spent for motor vehicles, tractors, machinery, and the equipment since World War II.

That is just since the World War years, and I would like to know, if possible, what the total cost of operation for machinery during that same period has been and as previously mentioned, I would like some idea as to how long it would be before that equipment would have to be replaced in value to properly operate that farm. And in the cost of operation of that farm, I would like to know annually about what the cost of operation and maintenance of the equipment to get the farm production on farms in the United States is required. I am interested in the annual farm expenditures for some of the things which have become necessary in maintaining production on our farms, such as lime and fertilizers from the period 1930, in 5-year periods, up until the present time.

CORRELATION BETWEEN FARM INCOME AND FERTILIZER SALES

I am wondering also if you have any figures that are directly related between the income, farm income, and how money is expended on that farm for such matters as lime and fertilizer. I am under the impression that a farmer, if his income is such that he is pinched, that that would be one of the first things that he would be inclined to drop which would mean that the value of efficiency of his unit of production would suffer. And I am wondering if you have any statistics that would show the relationship between his income and the use of that money from his income in producing or providing such things as lime and fertilizer that are so necessary to maintaining production, and a quality product.

Mr. WELLS. I am not sure whether we have anything that will bear directly on this last one, Mr. Congressman. Do you know, Mr. Johnson?

Mr. JOHNSON. I looked into that sometime ago. The picture is something like this. Before World War II, there was a very close relation between the farmer's income of the previous year, and purchases of fertilizer and lime. Since World War II, the relationship has not been nearly as close. Now, we can, of course, speculate as to some of the reasons for that. Fertilizer is used in areas where it was not used before. Where it has come in very rapidly as it has in the Midwest, apparently the use of fertilizers continued to increase. In the Southeast and the Northeast, the older fertilizer-using areas, there used to be a much more direct relationship. Actually, fertilizer consumption has gone up roughly 10 percent a year since 1939. There was a little drop with the drop in income following 1947, that is, a drop in the rate of increase. But total consumption did increase each

year.

Mr. WELLS. What you are saying is that we can show the percent of farm income spent from one year to the next for lime and fertilizer, but I do not know of anything we have that would directly relate

such expenditures to particular farm conditions on particular farms. Mr. JOHNSON. The fertilizer bill at the present time is approximately $1 billion a year. I can furnish additional information at this point in the record relative to your questions.

(The information referred to is as follows:)

Farmers' expenditures for purchases of motor vehicles and machinery, United States, 1946 to date

Source: Bureau of Agricultural Economics. Compiled from the Farm Income Situation.

Depreciation and cost of operation of motor vehicles and other machinery and equipment, United States, 1946 to date

Source: Bureau of Agricultural Economics. Compiled from the Farm Income Situation.

2 Estimated quantities available for use for 1952-53 are about 11 percent above those available the previous

year.

3 Estimated.

1930

1931

1932.

1933.

1934

1935

1936

1937

1938

1939.

1940.

1941.

Farmers' expenditures for fertilizer and lime, United States, 1930 to date

1 Preliminary.

Source: Bureau of Agricultural Economics. Compiled from the Farm Income Situation.

COMPARISON OF EFFICIENCY INCREASE BETWEEN FARM AND FACTORY

Mr. MARSHALL. The farmers have greatly increased their efficiency of production as shown by your chart, and I am wondering if you have anything that would show the corresponding efficiency increase of the people that produce the items they buy, such as tractors and equipment. How does the farmer's increase in efficiency compare with the industrial increase?

Mr. WELLS. We can get for you the estimated increases in efficiency per man-hour of industrial labor which comes from the Bureau of Labor Statistics. This is not per worker necessarily, nor per dollar of wages, but per man-hour. I am under the impression that, with the exception of 2 or 3 years during the demobilization period recently, industrial efficiency has been increasing at a rate of around 2 percent a year. That is industrial output per man-hour, actually worked. Roughly, over the last 50 years, Mr. Marshall, it has been my impression that the increases in agricultural and industrial efficiency have about offset one another in terms of hours worked or per man employed.

Mr. JOHNSON. That is correct. But since World War II, I think the production per man-hour has increased faster in agriculture.

Mr. WELLS. For 3 or 4 years the industrial productivity actually went down. It then turned up around 1947 or 1948. But from 1945 or 1946 into 1947 and 1948, we demobilized and during that process there was a letdown in industrial productivity.

EFFICIENCY RELATED TO RESEARCH

Mr. MARSHALL. As progress has been developed through research and through improved marketing, that brings an increase of income to the farmer. Do you have any figures that would show how that is related to how rapidly farmers put these practices into operation? Mr. WELLS. All I have there, Mr. Congressman, is a general observation. The really spectacular changes in yields per crop acre and yields per animal units came in the decade 1940 to 1950 when farm income was more nearly adequate than it had been for a very considerable number of years prior to that.

Now, I am not saying there were not some increases before that time. There were. But American farmers accomplished almost a miracle in the early years of World War II, even when some supplies were short, as Mr. Whitten pointed out earlier. However, it was also a time when farm incomes were more nearly adequate, more nearly allowed farmers to do the things that the smart businessman who is able to sell his product does.

I would like to insert here some additional information already prepared on the subject.

(The information referred to is as follows:)

RATE OF ADOPTION OF IMPROVED FARM PRACTICES

The rate at which new and improved farm practices are adopted by farmers varies widely with the particular practice. The major factors appear to be (1) the simplicity or complexity of the practice, (2) the capital expenditures required, (3) the length of time necessary for the new practice to reflect itself in increased income, and (4) whether the practice, machine, or technique is adaptable and economical for small farms as well as large.

An example of a simple, inexpensive practice where the returns are almost immediate is hybrid seed corn. But even here, the rate of adoption did not reach 90 percent in the main corn-producing area until about 12 years after its general introduction.

In the case of machinery, particularly the larger, more expensive kinds such as tractors, combines, cornpickers, and hay balers, the rate of adoption is much slower. The first models are usually large and expensive and are adaptable primarily on the larger farms. As the machines are improved and smaller models are successfully developed, their use becomes more widespread. Grain combines were widely used on larger grain farms of the Pacific Coast States before 1920, but even by 1938 only 49 percent of the wheat acreage and 10 percent of the oat acreage was harvested with combines. Since then, with development of smaller combines and improved farm incomes, the rate of adoption has increased rapidly until in 1950 about two-thirds of the oat acreage and 94 percent of the wheat acreage was harvested with combines.

Hay balers and cornpickers likewise were used by a considerable number of farmers in the 1920's. But only 12 percent of the corn acreage was harvested by cornpickers in 1938 and only 14 percent of the hay crop was baled in 1939. Again, the rate of adoption increased sharply during the last 15 years.

In the case of milking machines an even longer period of time was required before they were generally adopted by dairy farmers. Milking machines have been in use for more than half a century. But it was in World War II and in the years following, that their use became widespread. Shortages of farm labor and favorable farm incomes had much to do with this recent rapid rate of adoption. In 1945 only 24 percent of the farms with five or more cows milked reported having milking machines, but this rate has about doubled in the last 7 years. Percentage of wheat acreage harvested by combines, United States and selected regions 1938, 1945, and 1950