REVISION AND EXTENSION OF SUGAR ACT OF 1948

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP59-00224A000100250004-4
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 35
• Document Creation Date: November 11, 2016
• Document Release Date: October 28, 1998
• Sequence Number: 4
• Publication Date: July 22, 1955
• Content Type: REGULATION

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84TH CONGRESS HOUSE OF REPRESENTATIVES I REPORT
1st Session No. 1348
REVISION AND EXTENSION OF SUGAR ACT OF 1948
JnLY 22, 1955.-Committed to the Committee of the Whole House on the State
of the Union and ordered to be printed
Mr. COOLEY, from the Committee on Agriculture, submitted the
following
REPORT
The Committee on Agriculture, to whom was referred the bill
(H. R. 7030) to amend and extend the Sugar Act of 1948, as amended,
and for other purposes, having considered the same, report favorably
thereon with amendment and recommend that the bill as amended
do pass.
The amendment is as follows:
Strike out all after the enacting clause and insert:
That section 101 (d) of the Sugar Act of 1948, as amended, is amended to read
as follows:
"(d) The term `raw sugar' means any sugars (exclusive of liquid sugar from
foreign countries having liquid sugar quotas), whether or not principally of
crystalline structure, which are to be further refined or improved in quality to
produce any sugars principally of crystalline structure or liquid sugar."
Sac. 2. Section 101 (e) of such Act is amended to read as follows:
"(e) The term `direct-consumption sugar' means any sugars principally of
crystalline structure and any liquid sugar (exclusive of liquid sugar from foreign
countries having liquid sugar quotas), which are not to be further refined or im-
proved in quality."
SEC. 3. Section 101 (i) of such Act is amended by deleting the parenthetical
word "(Clerget)"
SEC. 4. Section 101 of such Act is amended by adding at the end thereof a new
paragraph to read as follows:
"(rt) The tern `to be further refined or improved in quality' means to be sub-
jected substantially to the processes of (P affination or defecation, (2) clarification,
and (3) further purification by adsorptio i or crystallization. The Secretary is
authorized, in accordance with findings based on public hearings to determine
whether specific processes to which sugars are subjected are sufficient to meet the
require-nents of this paragraph (a) and whether sugars of specific qualities are
raw sugar within the meant' g of paragraph (d) of this section, or direct-consump-
tion sugar within the meaning of paragraph (e) of this section."
SEc. 5. Section 201 of such act is amended by striking in the second sentence
thereof the words "1947 prior to the termination of price control of sugar" and
inserting in lieu thereof "1947-1949".
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Sac. 6. Section 202 (a) :)f such Act is amended by inserting a colon and "(1)
For the calendar year 1956' in lieu of the first comma and by adding the following
new paragraphs:
"(2) For the calendar year :1956, by apportioning among such areas 50 per
centura of the amount by which the determination made pursuant to section 201
exceeds eight million threw hundred and fifty thousand short tons, raw value,
as follows:
"(A) The first one hundred and eighty-eight thousand short tons, raw value,
or any part thereof, by wli. ch quotas for the domestic areas are so increased shall
be apportioned 45.2 per ce:rtum to the domestic beet area; 42.6 per centum to the
mainland cane area; 10.6 per centum to Puerto Rico; and 1.6 per centum to the
Virgin Islands; and
"(I3) Any additional amount shall be apportioned on the basis established in
paragraph (a) (1) as adjusted by subparagraph (A) of this paragraph (a) (2)
"(3) For the calendar year 1957 and each subsequent calendar tear, by appor-
tioning among such areas four million four hundred and forty-four thousand short
tons, raw value, in accordance with paragraph (a) (1) of this section, and by add-
ing thereto 50 per centum )t the amount by which the determination ma,de pur-
srant to section 201 exceeds eight million three hundred and fifty thousand short
tons, raw value, apportioned as follows: First, by apportioning in accordance
with the provisions of paragraph (a) (2) of this section an amount not in excess
of the amount so apportioned in 1956, and second, by apportioning the remainder,
it any, in accordance with the final quotas established for the calendar year 1956,
pursuant to paragraphs (a) (1) and (a) (2) of this section."
Sac. 7. Section 202 (c) of such Act is amended by striking out "For" after
"(c)" and inserting in lieu thereof "(1) For the calendar year 1056, for" and by
adding at the end thereof the following new paragraphs:
"(2) For the calendar year 1957 end for each subsequent calendar year for
foreign countries other thin the Republic of the Philippines, by prorating to
Cuba 96 per centum and to inch other oreign countries 4 per centum of the amount
of sugar, raw value, by whi,,li eight million three hundred and fifty thousand short
tons or such lesser amount is determined pursuant to section 201 exceeds the sum
of four million four hundred and forty-four thousand short tons, raw value, and the
quota established pursuant: to subsection (b) of this section; and by prorating to
Cuba 50 per centum and to foreign countries other than Cuba and the Republic
of the Philippines 50 per centum of the amount of sugar, raw value, by which the
amount determined pursuant to section 201 exceeds the sum of eight million three
hundred and fifty thousanc short tons plus the increase in quotas provided for in
subsection (a) (3) of this section: Provided, (i) that for 1957 the quota for foreign
countries other than Cuba and the Republic of the Philippines shall be one hundred
and seventy-five thousand short tons, raw value, and the quota for Cuba shall
equal the sum of the quotes for foreign countries other than the Republic of the
Philippines less one hundred and seventy-five thousand short tons, raw value; and
(ii) that for the calendar ,car 1958 and each subsequent calendar year through
1060 the quota for foreign countries other than Cuba and the Republic of the
Philippines shall be increased forty-five thousand short tons, raw value, annually
and the quota for Cuba shall equal the sum of the quotas for foreign countries other
than the Republic of the Philippines for such year less the quota for foreign coun-
tries other than Cuba and the Republic of the Philippines for such year."
The quota for foreign countries other than Cuba and the Republic of the
Philippines shall be prorated for the calendar year 1957 and for each subsequent
calendar year as follows:
(A) ' ach country +hose average annual importations into the United States
within the quota were less than one thousand short tons, raw value, during the
years 1953 and 1954 shall receive a proration equal to such a erage importations.
(B) Each country whose average annual importations into the. United States
within the quota were more than one thousand short tons but less than three
thousand short tons, raw value, durin the years 1953 and 1954 shall receive each
year tN'o thousand tons ii addition to the basic tonnages prorated under sub-
paragraphs (C) or (D) hereof.
(C) Each country whose average annual importations into the United States
within the quota were one thousand short tons but less than two thousand short
tons, raw value, during the years 1953 and 1954 shall receive a proration for 1957
equal to its average importations for the calendar years 1953 and 1959: plus 30
per centum thereof and for each calendar year subsequent to 1957 through 1960
the proration for each such country -hall be increased by an additional 30 per
centum of its proration under this subparagraph (C) for the immediately pre-
ceding calendar year.
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REVISION AND EXTENSION OF SUGAR ACT OF 1948 3
(D) That part of the quota not otherwise prorated in subparagraphs (A), (B),
and (C) above shall be prorated as follows:
G6antry Per centuna
Dominican Republic-----------------------------------------------
37
Peru-------------------------------------------------------------
36
Mexico ----------------------------------------------------------- _
20
Nicaragua--------------------------------------------------------.-
5
Haiti-------------------------------------------------------------
2
Sac. 8. Section 202 of such Act is amended by adding the following new
paragraphs:
"(e) Whenever in any year any foreign country with a quota or proration
thereof of more than ten thousand short tons fails to fill such quota or proration
by more than 10 per centum and at any time during such year the world price of
sugar exceeds the domestic price, the quota or proration thereof for such country
for subsequent years shall be reduced by an amount equal to the amount by which
such country failed to fill its quota or proration thereof, unless the Secretary finds
that such failure was due to crop disaster or force majeure or finds that such
reduction would be contrary to the objectives of this Act. Any reduction here-
under shall be prorated in the same manner as deficits are prorated under sec-
tion 204.
"(f) No country shall have its quota or proration thereof increased above its
quota or proration thereof for the calendar year 1956 unless, on or before January
1, 1957, such country becomes a party to and bound by the International Sugar
Agreement for the Regulation of the Production and Marketing of Sugar (ratified
by and with the advice and consent of the United States Senate on April 29, 1954).
"(g) Notwithstanding any other provision of law except paragraph (d) hereof,
if the Secretary determines that any country for which a sugar quota or proration
thereof is established herein causes a substantial reduction in the importation of
any agricultural commodity from the United States below the quantity imported
during a representative period of years, in raw or manufactured form, through
import quotas, import taxes, exchange restrictions, or other trade restrictive
measures, the sugar quota or proration thereof for such country shall be suspended,
during each year when such restrictive measures are at any time in effect and the
portion of such quota or proration thereof so suspended shall be prorated in the
same manner as deficits are prorated under section 204."
Sac. 9. (a) The second sentence of section 204 (a) of such Act is amended by
inserting before the period at the end thereof a colon and the following: "Provided,
That any deficit in any domestic sugar-producing area occurring by reason of
inability to market that part of the quota for such area allotted under the provi-
sions of section 202 (a) (2) or the increases allotted under section 202 (a) (3) shall
first be prorated to other domestic areas on the basis of the quotas then in effect."
(b) The last paragraph of section 204 (a) of such Act is amended by inserting
before the period at the end thereof a semicolon and the following: "except that
in the case of proration of any such deficit in any domestic sugar-producing area
occurring by reason of inability to market that part of the quota for such area
allotted under and by reason of section 202 (a) (2) or the increases allotted under
section 202 (a) (3), the Secretary shall apportion the unfilled amount on such
basis and to such other domestic areas as he determines is required to fill such
deficit, and if lie finds that no domestic area will be able to supply such unfilled
amount, he shall add it to the quota for Cuba".
Sac. 10. Section 205 (a) of such Act is amended by inserting immediately before
the final sentence thereof the following: "In making such allotments, the Secretary
may also take into consideration and make due allowance for the adverse effect of
drought, storm, flood, freeze, disease, insects, or other similar abnormal and
uncontrollable conditions seriously and broadly affecting any general area served
by the factory or factories of such person."
SEC. 11. (a) Section 207 (a). of such Act is amended by adding after the word
"year" the following: ", plus an amou~it equal to the same percentage of twenty-
nine thousand six hundred and sixtvwi short tons, raw value, that the increase in
the quota for Hawaii under section 202 is of one million fifty-two thousand short
tons, raw value".
(b) Section 207 (b) of such Act is amended by striking the period at the end
thereof and by adding the following: "which shall be principally of cry ,talline
structure, plus an amount equal to the same percentage of one hundred twenty-six
thousand and thirty-three short tons, raw value, that the increase in the quota for
Puerto Rico under section 202 is of one million eighty thousand short tons, raw
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value, which latter amount may be filled by direct-consumption sugar whether or
not principally of crystalline structure."
SEC. 12. Section 207 (h) of such At is amended by strik'ng out "The" after
"(h)" and inserting in lieu thereof "(1) For the calendar year 1956, the and by
adding the followi g new p rragraph:
"(2) For the calendar year 1957 and each subsequent calendar year, the quota
for foreign countries other than Cuba and the Republic of ,he Philippines may
be filled by direct-consumption sugar to the extent of 1.36 per centum of the
amount of sugar determined pursuant to section 201 less the sum of the quotas
established in subsections (ti) and (b) of section 202: Provided, That such limitation
shall not apply to countries receiving prorations under section 202 (c) of seven
thousand short tons or less. The direct-consumption portion of such quota
which is subject to the 1.36 per centum limitation referred to above shall be
prorated to countries which. receive prorations under section 202 (c) of more
titan seven thousand short tons on the basis of average imports of direct-cou emp-
tion sugar within the quota for the years 1951, 1952, 1953, and 1954."
SEC. 13. Section 301 (b) of such Act is amended by inserting after the words
"(or processed)" the following: ", except for livestock feed, or for the production
of livestock feed, as determined by the Secretary,".
SEC. 14. Section 302 (b) of such Act is amended by inserting after "or pro-
cessed)" the words "within the proportional share" and by striking the period
at the end thereof and inserting the following: "and of the producers in any local
producing area whose past production has been adversely, seriously and generally
affected by drought, storm, flood, freeze, disease, insects, or other similar abnormal
and uncontrollable conditions. For the purposes of establishing proportionate
shares hereunder and in ord>_r to encourage wise use of land resources, foster greater
diversification of agricultural production, and promote the conservation of soil
and water resources in Puerto Rico, the Secretary, on application of any owner
of a farm in Puerto Rico, is hereby authorized, whenever he determines it to be
in the public interest and to facilitate the sale or rental of land for other productive
purposes, to transfer the sugarcane production record for any parcel or parcels
of land in Puerto Rico owned by the applicant to any other parcel or parcels of
land owned by such applicant in Puerto Rico."
SEC. 15. Section 405 of s i.ch Act is amended by inserting "(a)" at the beginning
thereof and by adding the following new paragraph;
"(b) Any person whose sugar proce:;sing operations otherwise meet the require-
ments of section 101 (n) and who subjects to such processes sugar imported or
brought into the continental United States under a deciar`ttion that it is raw
sugar but which sugar subsequently is determined to be of direct-consumption
quality and to be in excess of the direct-consumption portion of the applicable
quota or proration or allotment thereof, shall forfeit to the United States a sum
equal to one cent per poun3. for each pound, raw value, of such sugar in excess of
tae direct-consumptiot portion of the applicable quota or proration or allotment
thereof, which forfeiture shall be recoverable in a civil suit brought in the name
of the United States."
SEC'. 16. Section 407 of such Act is amended by adding at the end thereof the
following sentence: "The provisions of this section shall not apply to persons
whose services are obtained pursuant to section 305."
SE(,,. 17. Section 411 of Mich Act is renumbered as section 412, section 412 of
such Act is renumbered as section 413 and a new section 411 inserted as follows:
"SEc. 411. The Secretary is authorized to issue such regulations as may be
necessary to carry out article 7 of the International Sugar Agreement for the
Regulation of the Production and Marketing of Sugar (ratified by and with the
advice and consent of the United States Senate on April 29, 1P54), restricting
importations of sugar into the United States from foreign countries not participat-
iig in such agreement, or to carry out the corresponding provisions of any such
future agreements ratified by and with the advice and consent of the United
States Senate."
SEC. 18. Renumbered suction 412 of such Act (relating to termination of the
lowers of the Secretary under the Act) is amended by striking out "1956" in
each place it appears therein and inserting in lieu thereof "1960".
SEC. 19. A new section 114 is added to such Act as follows:
"SEc. 414. (a) To alle'viate the conditions which exist in the continental
United States sugar-producing areas by reason of the quantities of surplus over-
quota sugar produced in inch areas, the Commodity Credit Corporation shall
carry out loans, purchases c r other operations with respect to one hundred thousand
exhort tons of sugar produced from the 1955 or previous crops in such areas.
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"(b) Sugar acquired hereunder shall be disposed of outside the continental
United States in such manner as the Corporation determines will not unduly
interfere with normal marketings of sugar, including dispositions under the
Agricultural Trade Development and Assistance Act of 1954, as amended.
"(c) No borrower shall be personally liable for any deficiency arising from the
sale of the sugar securing any loan made under authority of this section, unless
such loan was obtained through fraudulent representations by the borrower. This
provision shall not, however, be construed to prevent Commodity Credit Cor-
poration from requiring the borrower to assume liability for deficiencies in the
quality or quantity of sugar delivered under the loan, for failure to properly care
for and preserve such sugar, or for failure or refusal to deliver the sugar in accord-
ance with the requirements of the program.
"(d) Sugar acquired hereunder shall not be subject to the provisions of title II
of this Act."
SEC. 20. Section 201 of the Agricultural Act of 1949, as amended (63 Stat.
1052; 68 Stat. 899, 912), is further amended as follows:
1. After the comma following the word "butterfat" in the clause preceding
the colon, insert the following: "sugar beets and sugarcane,".
2. After subsection (c) thereof insert a new subsection (d) as follows:
"(d) The price of sugar beets and sugarcane, respectively, shall be supported
at a level of 90 per centum of the parity price therefor through loans, purchases
or other operations with respect to sugar derived from the processing of propor-
tionate shares of sugar beets or sugarcane of the 1956 and subsequent crops
produced in the domestic sugar producing areas of the United States. Loans,
purchases, or other operations with respect to such sugar shall be at such rates
or prices as the Secretary determines, after taking into account receipts of pro-
ducers from byproducts and conditional payments, will reflect the equivalent of
90 per centum of the parity price either for sugar beets or sugarcane. Sugar
acquired hereunder shall not be subject to the provisions of title II of the Sugar
Act of 1948, as amended."
SEC. 21. Sections 4501 (c) and 6412 (d) (relating to the termination of taxes
on sugar) of the Internal Revenue Code of 1954 are amended by striking out
"1957" in each place it appears therein and inserting in lieu thereof "1961"'
SEC. 22. Section 4502 (4), chapter 4, subchapter A, "Sugar", of the Internal
Revenue Code of 1954 is amended as follows: Strike out the parenthetical word
"(Clerget)" where it occurs in the first sentence and delete the second sentence
thereof.
SEC. 23. (a) Section 4504, chapter 37, subchapter A, "Sugar", of the Internal
Revenue Code of 1954 is amended by adding before the period at the end thereof
the following: "and except that such tax may be subject to refunds as a tax
under the provisions of section 6418 (a)".
(b) Section 6418 (a) of chapter 65 of the Internal Revenue Code of 1954 is.
amended by striking out the "(a)" immediately following "section 4501".
SEC. 24. The amendments made hereby shall become effective January 1, 1956,
except as otherwise designated and except that required determinations and
regulations may be issued in 1955 for the calendar year 1956.
11.. R. 7030 reenacts and extends for 4 years, to December 31, 1960,
the Sugar Act of 1948, as amended, with further amendments dealing
primarily with adjustments of quotas intended to give domestic pro-
ducers a fair share in the growth of the United States sugar market
and to bring about an equitable participation by foreign suppliers in
this market. The present act, in the absence of any action by the
Congress, would expire December 31, 1956.
The bill also extends for 4 years, to June 30, 1961, the applicability
of the excise tax on sugar in the Internal Revenue Code. This tax
finances the sugar-stabilization program.
This legislation's major effect is to open-the way for United States
domestic area producers to participate with foreign areas in sup_ plying
the growth of the United States sugar market.
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The United States this year will require approximately 8,350,000
short tons of sugar. The United States needs now are supplied 53.7
percent from domestic areas (consisting of 22 mainland States pro-
ducing beets, and 2 mainland Si,ates, Hawaii, Puerto Rico, and the
Virgin Islands, producing sugarcane); 33.1 percent from Cuba; 11.8
percent from the Philippines; and 1.4 percent from other foreign
countries (including the Dominican Republic, Mexico, El Salvador,
B aiti, Nicaragua, Peru, and all others).
This distribution is brought about by the provisions of the Sugar
Act that assign fixed quotas amounting to 4,440,000 short tons, raw
value, for the domestic producing area, and 952,000 short tons to the
Philippines; and give to Cuba 96 percent, and to all other foreign
countries 4 percent, of the remaining portion of the United States
market.
Thus, Cuba for a number of years has enjoyed an increasing mar-
ket for her sugar here equal to virtually the complete growth of sugar
consumption in the Ur' iced States, since the present law holds the
domestic producing arcEts and the Philippines to definite, inflexibly
fixed quotas.
11. R. 7030 maintains unchanged the participation of the domestic
areas and the foreign suppliers in the present level of consumption of
the United States market. All suppliers will continue to receive their
established shares in the market at its current level.
But this legislation would open the way for United States pro-
ducers to participate in the larger market constantly being created by
the growth of our consumption of sugar, and to a lesser extent other
foreign suppliers would enjoy a part of this expanding market along
with Cuba, in the following manner:
For the Calendar year 1956, the amount of the increase in our
market above 8,350,00C short tons, raw value, would be apportioned
50 percent to domestic producing areas and 50 percent to the foreign
suppliers (except the Philippines which has a fixed quota), with Cuba
getting 96 percent and all other countries receiving 4 percent of the
50 percent going to the foreign suppliers. The first 188,000 tons, or
any part thereof, by which quotas for the domestic areas are so in-
creased in 1956, would be apportioned 45.2 percent to the domestic
beet area; 42.6 percent to the mainland cane area; 10.6 percent to
Puerto Rico; and 1.6 percent to the Virgin Islands,. If rising con-
sumption should increase the quotas of domestic areas by more than
138,000 tons in 1956 the excess would be allotted on the basis of the
present law's assignme it of quotas.
For 1957, 1958, 1959, and 1960, this bill-
1. Assigns between the domestic producing areas and the
foreign suppliers additional quotas year by year each equal to
50 percent of the growth of the United States market above the
current 8,350,000 tons of consumption a year.
2. Provides that for 1957, 1958, 1959, and 1960 the additional
quotas for domestic areas producers (representing 50 percent of
the growth in the United States market) will be distributed in
accordance with the final quotas established for the calendar year
1956.
That in 1957 the total of established and growth quotas for
foreign suppliers (other than the Philippines) would be distributed
(1) the first 175,00) tons to the foreign suppliers other than Cuba
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and the Philippines, and (2) Cuba to receive a quota compute y
subtracting 175,000 tons from the sum of the quotas for foreign
countries other than the Philippines.
4. That for 1958, 1959, and 1960 the additional quotas repre-
senting 50 percent of the growth assigned to foreign suppliers
(other than the Philippines) would be distributed (1) the first
45,000 tons to the foreign suppliers other than Cuba and the
Philippines, and (2) Cuba to receive an additional quota com-
puted by subtracting 45,000 tons from the 50 percent of the
growth in the United States market which would be assigned
to foreign countries.
5. That proration of their quota among the foreign countries
(other than Cuba and the Philippines) be changed beginning in
1957 by assigning to those countries which exported to the United
States less than 1,000 tons during the years 1953 and 1954 a
fixed quantity equal to their average proration in those years and
by assigning to the countries that brought in between 1,000
and 3,000 tons in those years a fixed quantity of 2,000 tons
in addition to their further proration, as follows: Countries
whose average imports here were between 1,000 and 2,000
short tons in 1953 and 1954 receive prorations for 1957 equal
to such average entries plus 30 percent thereof and for each
subsequent year prorations for such countries are increased
by an additional 30 percent above the prorations for the immedi-
ately preceding year; the balance of the quota for countries
other than Cuba and the Philippines is prorated 37 percent to the
Dominican Republic, 36 percent to Peru, 20 percent to Mexico,
5 percent to Nicaragua, and 2 percent to Haiti.
An annual growth in United States sugar consumption of approxi-
mately 135,000 tons is expected on the basis of past experience. The
accompanying table (table A) shows how this bill would distribute the
full tonnage estimated on such an assumed growth.
To alleviate a surplus condition in the continental United States
sugar-producing areas, this bill provides that the Government pur-
chase or otherwise remove from the market 100,000 tons from the
1955 or previous crops in such areas, for disposition outside the con-
tinental United States in such manner as not to interfere unduly with
normal marketing of sugar. It is assumed this sugar will be distrib-
uted in the relief operations of the International Cooperation Adminis-
tration.
To deal with any future surpluses, provision is made that the price of
sugar beets and sugarcane shall be supported at 90 percent of parity
through loans, purchases, or other operations with respect to sugar
from the processing of proportionate shares of sugar beets and sugar-
cane, produced in the domestic areas of the United States.
Although the committee has not included in the bill any specific
directive for distribution of additional domestic quotas to new
producers, it is the belief of the committee that the act should be
administered so as to benefit new producers and new producing regions
as increased domestic acreage becomes available as the reesult of quota
increases.
Foreign countries which fail by a substantial margin to supply sugar
to this market in. years when the world price is higher than our domes-
tic price are subject to quota curtailment in future years, unless the
Secretary of Agriculture finds that such curtailment is unwarranted.
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+ or gn countries which discriminate against the importation of agri-
cultural commodities from this country are subject to quota suspen-
sion during each year when such restrictive measures are in effect.
Foreign countries which did not become participants to the Inter-
naLtional Sugar Agreement on or before January 1, 1957, are not
eligible for increases in quotas or prorations above the 1956 level.
Provisions of the Sn 7ar Net which limit the entry of direct-con-
sumption. sugar within quotas o' both foreign and offshore domestic
sr.reas would be varied slightly to permit an increase in such allocations
for the offshore domestic areas and to permit those foreign countries
which have relatively small quotas the convenience of shipping either
raw or refined sugar to this market.
The method of prorating deficits would be changed slightly to insure
that increases which domestic areas receive through market participa-
tion but which they are not able to fill shall first be prorated to other
domestic areas rather than to Cuba and the other domestic areas as is
the case under the prosent act. In the event a domestic area is
unable to fill a proration of a def+cit assigned to it which results from
increased quota clue to market p:a,rticipation, the unfilled portion also
will he apportioned to other domestic areas unless no such area is
able to supply the required quantity in which case it will be added to
the quota of Cuba.
There are other provisions in the bill in the interest of equity and
efficient administration in this reenactment and extension of the Sugar
Act. These are discussed in some detail in the analysis of the bill
which appears later in this report.
Th(, , following table was prepared by officials of the Sugar Division,
Department of Agriculture, at the request of the committee. On
the basis of an assumed c-)nstant increase in United Ste tes consumption
of 135,000 tons a year, t shows the quotas which would result; from
application of provisions of the bill.
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REVISION AND EXTENSION OF SUGAR ACT OF 1948 9
TABLE A.-Sugar quotas and prorations: Present law for 1955 (II. R. 7030), as
reported by the Committee on Agriculture
[Short tons, raw value]
['resent
law, 1955
Assumed requirements---------
8,400,00
Domestic areas-----------------------
Beet -
4,441, 00
1,899,00
Mainland cane _________________-_
500, 00
Hawaii-- -----------------------
1, 052, 00
Puerto Rico---------------------
1,080,)6
Virgin Islands-------------------
12, 011
Foreign areas ------------------------
3, 956,1)0
Philippines----------------------
977,(x)
Cuba ----------------------------
2,859,81
"Full duty" countries ----------_
119, 16
Dominican Republic_____________
29,59
Mexico-------------------------
12, 2(i
Nicaragua-----------------__--_
8,38
Peru--- ----------------
55, (i5
Haiti----------------------------
2, 80
Costa Rica ----------------------
(1,()8
Formosa-------------------------
(1,11'
Netherlands------------------ -_
(1,12
Panama-------------------------
x (1,11
Belgium-----------------------
1 (18
British Guiana------------------
(8,
Canada --------------------------
(63
Hong Kong ----------------------
United Kingdom ________________
1 ('
3
1 (51
El Salvador 2--------------------
4,43
1956
1957
1958
1959
1860
8,535,000
0
8,670,000
8,805,000
8,940,000
9,075,000
4, 536, 500
0
4, 694, 000
4,671,500
4, 739. 000
4,806,500
0 1,841, 000
1,869,215
1,896,620
1,924,024
1,951,430
0 539,403
547,431
555,457
563,483
571,509
0 1,052,000
1,067,653
1,083,306
1, 098, 959
1,114,612
0 1,089,805
1,106,020
1,122,236
1,138,452
1,154,667
0 13,480
13,681
13,881
14,082
14,282
0 3, 988, 500
4,066,000
4,133, 500
4,201,000
4,208,500
0 977, 000
977, 000
977, 000
977, 000
977,000
2,900,640
2,914,000
2,936,500
2,959,000
2, 951, 500
0 120, 860
175, 000
220, 000
265,000
310, 000
2 30, 014
58,393
74, 403
80, 221
105, 789
9 12,444
31, 561
40,218
48, 768
57, 184
6 8,506
7, 801
10, 054
12,192
14, 296
56,452
56, 814
72, 392
87, 782
102,930
3 2,904
5,156
6,022
6, 877
7,718
4) 1 (1, 084)
3, 409
3, 832
4, 382
5, 097
4) 1 (1,114)
3,448
3,882
4,447
5,181
3) 1 (1,123)
3, 460
3,898
4, 467
5, 207
) 1 (1, 114)
3, 448
3,882
4, 447
5, 181
2) 1 (182)
182
182
182
182
5) 1 (85)
85
85
85
85
1) 1 (631)
631
631
631
631
) 1 (3)
3
3
3
3
) 1 (516)
516
516
516
516
4 4,497
-----------
-----------
-----------
0
8
4
6
---------
I Average 1953-54 charges against quotas. These countries do not have specific proration under the
present law. These entries are made within the proration for unspecified countries which amounts to 5,958
tons and 6,043 tons when requirements are 8,400,000 tons and 8,535,000 tons, respectively.
2 No entries since 1048.
Participation by the United States sugar producers in the future
market growth in this country does no more than restore to them the
status they had under sugar-quota legislation prior to World War II.
In the Sugar Act of 1948, quotas for the domestic areas were limited
to fixed quantities in order to assist Cuba in making the transition
from wartime to peacetime conditions by assigning to her virtually
all of the increases in the United States sugar market. It was recog-
nized at the time that the change was of temporary nature and that
at the appropriate time the domestic areas should resume participa-
tion in market growth.
The committee is of the opinion that 1956 is the appropriate time
in view of the fact that all of the domestic areas are producing at or
above their quota levels even though successively more stringent
production controls have been imposed in several of those areas.
Additional quotas granted to foreign countries are in line with our
national policy of broadening our trade relations. Cuba retains its
status as our largest foreign supplier by a wide margin and also retains
a share in our market growth. Other Latin American countries
receive quota increases which are large proportionally to their mar-
ketings heretofore, but which are small in relation to our total imports.
The committee recognized the needs of the mainland sugar areas
for inventory relief, but preferred not to make a change affecting
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10 REVISION AND EXTENSION OF SUGAR ACT OF 1048
quotas for the year 1955 because of the difficulties which would be
created for producers in. Cuba whose marketing plans for this year
aiready have been completed. Rather, to alleviate the immediate
situation in the mainland areas, the committee has authorized a
Commodity Credit Corporation loan, purchase, or similar operation
with respect to 100,000 tons of 1955 or previous crop mainland sugar.
Cuba's anticipated share of the total United sates market is
reduced somewhat in 1956, under the provisions of this bill, because
of participation by the domestic areas in market increases beginning
drat year and is further reduced beginning in 1957 because of the
enlarged shares of the :market thereafter assigned to other countries.
The actual tonnage of sugar which Cuba will market in the United
States is expected to increase, however, from year to year because of
anticipated continuation of the substantial annual increases in our
sugar consumption.
Nevertheless, the committee has suggested to the -xecutive depart-
ments of the Government that they give consideration to the possi-
bility of acquiring sugar from Cuba in 1956 to offset the smaller
increase in the Cuban quota which will occur that year in compari-
son to what the increase would have been under the present act which,
if not amended, does not expire until December 31, 1956.
Although all producers, foreign and domestic, who participate in
the American market are fully aware that it is the erivilege and the
duty of the Congress to revise the Sugar Act at any time there is
impelling cause, this committee has gone to great lengths to protect
the status of foreign sun pliers in this market.
The committee feels that it has found a fair solution for all parties
ini this bill, as we have justly brought our own producers into par-
ticipation in. the growth of our own market, and have sought an
equitable distribution of the remainder of our market growth among
our good-neighbor countries that help supply this market.
NATIONAL POLICY
For many years it has been the policy of the United States Govern-
ment-for defense and strategic reasons-to preserve within the
United States the abili,v to produce a portion of our sugar require-
ments. This has been clone because sugar is an essential and vital
food product needed by , American consumers, the supply of which on
a worldwide scale has been marked by periods of alternating scarcity
and surplus.
A large portion of the world's sugar production is grown in tropical
countries with essentia'ly one-crop economies, where cheap labor is
abundantly available and cannot be utilized in other enterprises. An
additional large portion is distributed among the majority of the
countries of the world which, like the United States, provide protec-
tion to their sugar industries. In these circumstances, it is unlikely
that a significant amount of sugar would be grown in the continental
United. States if American producers had to compete on the open
world market with sugar produced with cheap tropical labor.
For many years, protection was afforded to our sugar producers
solely through the tariff. Although the tariff did assist domestic
producers, it still left them exposed to the price fluctuations of the
world sugar market. It. also increased the price of sugar to consumers
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REVISION AND EXTENSION OF SUGAR ACT OF 1948 11
in the United States without assuring them of adequate foreign sources
of supply in case of emergencies.
A quota system which prorated domestic consumption among
producers in the United States and a number of foreign countries
was developed and enacted as law in 1934. The quota system was
revised in 1937 and again in the present act which became effective
in 1948 and was amended in 1951, effective as of January 1, 1953.
Since initiation of the quota system, the tariff on sugar has been
reduced 75 percent and now represents only supplementary protection
to the sugar industry.
A tax of 0.5 cent per pound is imposed on all sugar manufactured
or imported into the United States. Payments are made to domestic
producers of sugarcane or sugar beets at a rate which ranges from
80 cents per hundredweight of recoverable sugar produced on small
farms to as little as 30 cents per hundredweight of production in
excess of 30,000 tons of sugar on large farms. To qualify for payments
under the program, producers must comply with production restric-
tions, pay fair wages to workers, and not employ child labor and, if
they are also processors, pay fair prices for sugarcane or sugar beets.
Income to the Government from the tax on sugar has been very
substantially in excess of the amount disbursed as payments to do-
mestic growers during each of the years under the program. In recent
years the income from the excise or import compensating tax has
approximated $80 million annually, while payments to growers have
approximated $65 million.
In the last 18 years there has been a net return to the Treasury of
over $300 million in the difference between collections on the_ sugar
excise tax and the actual cost of the stabilization program.
World sugar production reached a record level of about 47 million
tons during 1954-55 despite the fact that production was rigidly
controlled in Cuba, the Dominican Republic, and most areas of the
United States. By comparison, a century ago production had been
less than 2 million tons and in 1900 it was only 13 million tons. During
the period just before and. after World War II it was about 33 million
tons. Production of centrifugal sugar, which now accounts for all
but about 6 million tons of the total, is shown by countries for recent
years in the following table.
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12 REVISION AND EXTENSION OF SUGAR ACT OF 1948
TABLE B.-Centrifugal r,ugor (raw value): Production in specified rourtries,
averages 15115- 39, 1945-19, onnuat 1951-51, 12
]forth American (cane and beet):
British Honduras_____________________
Canada
------------------------------
Costa Rica ___________________-_______
Et Salvador------------------------
G uatemala----------------------------
h onduras_
Mexico ---------------------- _________
Nicaragua- _----________--__--___
Panama---------- ----------
U nited States (beet)__________________
United States (cane)-------_______-__
Hawaii----------------------------
Puerto Rico__________________________
Virgin Islands________________________
Antigua------------------------------
Barbados------------------ --------
Cuba---------------- -------------
Dominican Republic__________________
Grenada ----------------------------
Guadeloupe_-____ _-________
B aiti------------------------- ------
Jamaica --------------------- --------
Martinique-------------------- -------
St. Kitts-----------------------------
St. Lucia and St. Vincent____________
Trinidad and Tobago_________________
Total, North America--------------
Western Europe (beet):
Austria-------------------------------
tlelgium . - ------------------ --------
Denmark- ---------------------------
Finland -------------------------------
France ---- ---------------- --------
Germany, Western__________________
Ireland------------------------------
Italy----------------------------------
Netherlands________________________
Spain 5--____
-------------------------
Sweden----------------------------
Switzerland__.____________________---
United Kingdom -_.____-_-__-_______
Yugoslavia
Total western Europe _ _ _ _ _ _ _ _ _ _ _ _ _ _ _
Total eastern Europe _ _ _ _ _ _
Total Europe_______________________
- - - - - - - - - - - - - - - - - - - - - - -
I T . R. (Europe and Asia) (bent)--___
1.sia (bent and cane):
Afghanistan (beet)--------_____-_____
Burma-------------------- ------
China, Including Manchuria 7._______
In dia-------------------------------
Indochina__-__________-___--______
Indonesia------------ -------- --------
[ran (beet) -------------------- -------
Japan (beet) --------------------------
Pakistan
Philippines, Republic of______________
Ttynkyu Islands
Syria (beet) -------------------------
Taiwan (Formosa) --------------------
Thailand ------------------ -------
Tnrkgy (beet)
Aver
ages
-
3
1951
1952
1953
1954
1935-39
1945-49
1
1
3
4
4
4
76
99
133
160
11,11
124
9
20
33
34
38
35
17
27
31
32
36
36
19
33
33
44
46
48
2
1
7
10
11
11
353
636
807
911
960
1,063
9
21
35
38
42:
46
5
11
21
20
21
19
1, 517
1,514
1,549
1,505
1,817
2,037
474
455
419
605
630
607
980
861
1,020
1, 099
1,077
1, 092
974
1,134
1,360
4 1,170
11,190
4 1,200
6
6
12
14
10
10
22
25
38
36
14
21
114
121
176
169
184
162
3, 183
5,897
7,964
4 5, 687
4 5,390
4 4,998
491
509
648
668
699
772
1
1
2
1
1
1
60
48
106
96
114
128
44
49
64
63
54
55
119
235
299
370
407
413
64
29
42
60
78
87
36
40
57
58
56
58
11
12
14
16
14
16
149
144
154
172
193
204
8,736
11,929
15,027
13,042
13,217
13,250
196
46
175
146
197
233
259
246
293
356
450
375
260
266
394
295
425
24.5
13
14
23
22
40
41
1, 078
823
1, 395
1, 100
1, 804
1, 860
610
524
1, 169
990
1,552
1, 44.5
89
95
100
102
143
111
414
331
825
819
855
816
261
270
386
478
.504
468
202
200
366
669
376
400
340
311
6 323
5 267
E 388
6 342
13
28
33
32
36
37
515
612
753
686
867
806
103
127
256
61
211
161
4,353
3, 893
6, 491
6, 023
7,848
7,340
2, 925
2,055
3,095
2,555
3,430
3.235
7, 278
5, 948
9, 586
8, 578
11, 278
10, 575
2, 761
1, 643
2. 700
2,500
2,700
2, 500
------
--------
5
_____
4
6
7
27
10
17
25
26
25
87
77
72
96
86
132
1, 303
1,319
1,900
1,700
1,320
1,690
77
11
7
4
3
3
1,207
102
472
637
683
800
23
41
85
87
87
75
46
11
31
38
48
40
33
34
83
95
91
100
1, 058
382
1,076
1, 134
1, 435
1,405
32
0
1
4
--___-_-.
0
0
2
7
9
9
1,240
346
597
983
796
755
21
28
37
40
40
42
70
111
228
200
213
218
5, 230
2, 492
4, 613
5, 054 1
4,843
, 5,301
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REVISION AND EXTENSION OF SUGAR ACT OF 1948
TABLE, 13.--Centrifugal sugar (raw value): Production in specified countries,
averages 1935-39, 1945- 49 annual 1951-5/t 1 2--Continued
[1,000 short tonsl
South America (cane):
Argentina--___
Bolivia----------------- -------------
Brazil---------- ----------
British Guiana --------- ------------
Colombia -------------- - -------------
Ecuador
Paraguay----------------------------
Peru ---------------------------------
Surinam - ----------------------------
Uruguay 7---------- -----
Venezuela----------------------------
Total, South America______________
Africa (cane):
Angola------------------------------
Belgian Congo -----------------------
British East Africa_____ _____
Egypt--------- ----------
Majagascar _______________?__--____
Madeira and Azore Islands 7____-_____
Mauritius---------------------------
Mozambique_________________________
Reunion- -----------------------
Union of South Africa._______________
Total, Africa______________________
Oceania (cane):
Australia-----------------------------
Fiji ---------------------------------
Pacific Islands________________________
Total Oceania_____________________
World total (cane) -
Worldtotal (beet) ------------------
World total (beet and cane) ---------
Averages
-
1
1952
1953
19543
--
195
1935-39
1945-49
510
654
760
654
829
908
1
2
3
7
6
7
830
1, 420
1, 857
2, 151
2,328
-9,500
210
198
272
269
268
276
51
135
178
218
240
270
24
44
53
64
59
58
6
16
33
25
16
19'
444
485
528
675
687
690'
15
5
7
8
8
0
2
3
11
19
25
32
22
41.
70
80
110
130
2,115
3,003
3,772
4,170
4,576
4,896
37
50
54
56
57
50
14
17
17
18
19
19
63
88
88
92
81
91
166
211
208
247
295
330
16
14
17
18
20
15
9
9
11
11
11.
11
320
351
535
517
566
551
81
86
92
99
101.
99
91
81
142
174
180.
_ 200
498
542
533
670
725
829
1,295
1,449
1,697
1,902
2,064
2,194
894
830
809
1,027
1,364
1,425
150
131
146
183
192
180
69
0
0
0
0
0
1, 113
961
955
1, 210
1, 556
1, 605
16,755
18, 043
24,008
23, 358
23, 888
24, 687
11, 773
9, 382
14, 342
13, 098
16, 346
15, 634
28,528
27, 425
38, 350
36, 456
40, 234
40, 321
I Centrifugal sugar, as distinguished from noncentrifugal, includes cane and beet sugar produced by the
centrifugal process, which is the principal kind mcving in international trade.
2 Years shown are for crop years: generally the harvesting season begins in the fall months of the year shown
or in the early months of the following year, except in certain cane-sugar-producing countries in the Southern
Hemisphere, such as Australia, Argentina, M aritius, Union of South Africa, etc., where the season begins
in May or June of the year shown.
3 Preliminary.
4 Restricted crop.
E Includes a small amount of cane sugar.
d Including sugar from Danish beets processed in Sweden.
7 Includes both cane and beet sugar.
Source: Foreign Agricultural Service. Prepared or estimated on the basis of official statistics of foreign
governments, reports of agricultural attachOs and other United States representatives abroad, results of
office research and other information. Estimates of countries having boundary changes have been adjusted
to postwar boundaries.
The remarkable increase in production long ago removed sugar from
the category of luxury food items and made it one of the cheapest of
all foods on a caloric basis. Postwar increases in production have
brought the world market price down to the present low level of about
3.25 cents per pound.
Production has been stimulated by special incentives in the way of
subsidies, tariffs, and other programs designed to make most of the
countries of the world partially or wholly self-sufficient with respect,
to sugar production. In those tropical areas where sugar is produced
in large quantities for export, the absence of other opportunities for
utilizing labor has tended to promote ever-increasing production
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14 REVISION AND EXTENSION OF SUGAR ACT OF 1948
through low wages. F ecause of these situations, falling prices have
not had the familiar effect of curtailing production. In a similar
way, consumption has not tended to rise significantly in response to
price declines because of high retail prices for sugar in many countries
resulting from consumption taxes and other devices which insulate
the retail price of sugar in those countries from the free world market
price.
In most of the countr: es of the world, the price of st gar to consumers
is from 2 to 17 cents above the world market level.
The International Sugar Agreement negotiated in London during
1954 has as one of its objectives the promotion of sugar consumption
through the removal. cf excessive taxation and other consumption
retarding devices and the discouragement of undue protectionism.
The long-term effect of the agreement in this respect may be very
helpful and in the meantime world consumption has, been rising at a
quite remarkable rate is response to population growth and improving
aironomic conditions.
The International Sugar Agreement is also designed to gear produc-
tion of sugar destined for sale in the world market to demand in that
market. Nevertheless, the outlook is the same as it has been in the
past: chronic production in excess of demand during nonemergency
periods alternating with. unsatisliable demand during emergency or
wartime pericds.
Prior to the war, our domestic production fluctuated considerably
and averaged about 4 million tons, the level it had attained in 1933.
1Juring the war, and l,articularly in the latter stages, our national
policy was to encourage other crops to a greater extent than sugar
beets. Because of this situation coupled with labor and supply short-
ages resulting from the war, as well as direct war activities, production
declined in each of the domestic areas, except the mainland cane area
and averaged about 3.5 million ions. Under the Sugar Act of 1948,
production has risen in each of the domestic areas and for the period
has averaged about 4.5 million tons. Last year it totaled 4.9 million
toms.
The first tariff on sugar was imposed in 1.789 to provide revenue
for this country in the early years of its independence. During the
major part of the 19th. century, when import duties and domestic
excise taxes were the chief source of Government receipts, the sugar
tariff yielded close to 211 percent of our import duties.
The revenue tariff, incidentally, provided protection to the sugar
industry in Louisiana after that area became a United States Territory
in 1803. Hawaii also received the benefit of tariff protection under
the Reciprocal Treaty of 1876 negotiated with the then Kingdom of
Hawaii. Following a short experiment during the years between 1890
and 1894, with sugar on the free list and with a 2-cent-per.-pound
bounty on domestically produced sugar, the tat-'if was reenacted
strictly as a protective levice for the domestic industry.
After the Spanish-American War, our new possessions, Puerto
Rico and the Philippines, received the benefit of tariff protection and
a preferred tariff status was granted to Cuba. Production expanded
rapidly in all three areas and also in the mainland sugar-beet area
which had developed in the latter part of the 19th century, but which
expanded rapidly in. the early years of the present century.
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 Approved For Release ~~-9-p~0010Q?50004-4
REVISION AND FXTEN{I A
During the protective tariff period, our sugar industry experienced
alternating periods of prosperity and depression. But by 1933 it
had become clear that the tariff system alone would no longer ade-
quately protect the domestic industry and yet it had forced Cuba,
our principal foreign supplier, to the brink of economic and political
disaster. Sugar prices in Cuba that year declined to a small fraction
of the 2-cent-per-pound tariff. Cuba was no longer a major market
for American goods and mainland sugar producers could not get
"fair exchange value" for their sugar crops.
Under the present quota system, the tariff is a supplementary
means of protection and has been reduced progressively from a rate
of 2 cents per pound of Cuban sugar in 1934 to the present rate of
0.5 cent per pound.
Congress in 1934 enacted the Jones-Costigan Act, which restricted
the supply of sugar in the United States market to a total quantity
determined each year by the Secretary of Agriculture. Market
shares for the mainland beet and cane areas were established in the
act largely on the basis of production during the 2 preceding years.
The Secretary was given discretionary power to determine which
3 years during the 9-year period, 1925--33, would serve "as the most
representative" years to form the basis for the quotas of each of the
offshore areas. For most of the areas he chase the period 1931-33,
and for Hawaii the period 1930-32. The act also provided for an
excise tax on sugar and for benefit payments to domestic growers as
well as for control of domestic production and imports.
The Sugar Act of 1937 established each area's share of the market on
the basis of percentages which were about the same as those developed
through experience under the 1934 act. As a group, the domestic
areas received 55.59 percent of total domestic requirements and were
guaranteed a minimum quota of 3,750,000 tons. Cuba's percentage
was 28.60; the "full duty" countries, 0.40; and the Republic of the
Philippines, 15.41, with a guaranteed minimum quota for the latter
country of 952,000 tons of sugar, tel quel.
The act provided for an excise tax at the rate of one-half cent per
pound of sugar and also provided for payments to domestic growers
on the conditions that rnarkotings were keep within quota limits,
that they paid fair wages and employed no child labor, and that those
who were also processors paid fair prices for sugarcane or sugar beets.
After suspension of quotas during the war years, the Sugar Act of
1948 was enacted with a number of changes designed to meet the
problems of the postwar transitional period. This committee empha-
sized in its report at that time, that the act was to be regarded in that
light and not as the establishment of long-term national sugar policy.
The domestic areas were given fixed tonnage quotas which were
roughly equivalent to the percentage shares they had received under
the 1937 act. The Republic of the Philippines, whose sugar industry
had been demolished during the war, received the fixed tonnage quota
specified in the Philippines Trade Act of 1946, 952,000 tons of sugar,
tel quel. Cuba and the "full duty" countries became the residual
suppliers, with Cuba receiving 98.64 percent of such needed supi lees.
Cuba also was to supply 95 percent of the deficits in the Philippines
quota which, it was known, would be large during the years when that
country was rebuilding its sugar industry. The "full duty" countries
which formerly received all of the Philippines deficits retained 5
percent.
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 JRprov~d For Release : CIAoRDP59-002o24A000100250004-4 AND EXTENSION F SUGAR ACT 1948
The. Sugar Act was amended and extended in 1951, effective as of
January 1, 1953. The major features of the 1948 act were retained
unchanged, except tha 5 the quota for Puerto Rico was increased by
170,000 tons, that for the Virgin Islands by 6,000 tons, and Cuba's
share of the residual quota was reduced to 96 percent, while the
share of the full duty countries was raised to 4 percent.
Because of the speci?Ll consideration given to Cuba under the 1948
act and the healthy demand in the world market, Cuba, contrary to
wcpectations, was not required to cut its production during the early
postwar years. As a result of thr, flourishing demand for sugar during
the period of the Korean hostilities, Cuba actually was enabled to
increase production steadily until 1952, when the record crop of
8 million tons was harvested.. That crop, h.owe Ter, supplied all
world needs and left a surplus of approximately 2 million tons, which
has overhung the market since that time. Beginning with the next
crop, Cuba curtailed production and has continued to do so during
each succeeding year.
Cuba has supplied to this market an average of 2.1 million. tons
under the Sugar Act of 1937, 2.9 million tons during the war years,
3.0 million tons during the 5 years under the Sugar Act of 1948, and
2.7 million tons during the 2 completed years under the present
extension.
When the act was last extended in 1951, Puerto Rico was the only
domestic area, which had experienced a surplus crop and the quota for
that area was increased by 170,000 tons to alleviate the problem.
When the extension became effective in 1953, it already had become
apparent, however, that production was rising rapidly to quota .levels
in all of the domestic areas. Farm production, in general, was mov-
in- toward a surplus situation in 1952 and, as a result, sugar beets
have become increasingly favorable in relation to alternative crops.
Production research has made available new varieties of both sugar
beets and sugarcane plus improved fertilization practices which have
tended to increase yrelc.s substantially in the last few years. This
tendency has been particularly strong in the mainland cane area.
Marketing allotments and acreage controls have been in effect in
Puerto Rico continuously under the present extension of the act.
Marketing allotments were imposed in the mainland cane area in
1953 and in the mainland beet area in 1954. Acreage allotments have
been in effect in the mainland cane area since 1954 and in the belt
axon beginning with the present crop.
Current sugar invento_-ies in both mainland areas are about 200,000
tons above average. In the mainland cane area inventories amount
to 400,000 toms, or 110 oercent above average, and in the mainland
bent area 1,600,000 tons, or 15 percent above average.
SUGAR PRICES
A hundred years ago, sugar was very expensive and quite rare.
After the Civil War, for instance, raw sugar wholesaled for more than
20 cents per pound and at one time in our history the tariff alone on
loaf sugar was 12 cents per pound. As the price of sugar declined,
consumption rose until the middle 1920's, after which time price
appeared to have little effect upon the rate of sugar consumption in this
country. The price of sugar in relation to other foods and per capita
IA-RDP59-00224A000100250004-4
 Approved For Release : CIA-RDP59-00224A00010P250004-4
REVISION AND EXTENSION OF SUGAR ACT OF 1948
distribution of sugar are shown in the following table for the pi'riO(l
since 1860:
TABLE C.-Wholesale sugar prices, index numbers of wholesale prices of all foods
and wholesale sugar prices in relation to prices of all foods, annually. 1860 to 1954
and monthly January to May 1955
relation to per capita disposable
l1iidex numbers of per capita income le income iso,) wholesa, and us sugar prices of rel
i
Lugar price,
net cash,
New York
9.78
8.75
11. 16
14.28
22. 56
21.56
16.68
15.78
10.32
16.19
13.53
13.28
12.37
11.34
10.56
10.72
10.47
11. 31
9.48
8.78
9.60
9.67
9.23
8. 51
6.78
6.44
7
6.1
6.01
7.01
7.64
6.17
4.64
4.33
4.84
4.12
4.15
4.53
4.50
4.96
Index numbers
(1935-39=100)
Prices of
all foods
(wholesale)
Per capita
disposable
income
126 ---------- 12.85
113 11.97
106 ------------ 12.53
99 - 12.49
100 ------------ 11.34
103 10.25
98 10.94
92 ---------- 11.38
94 ------------ 12.03
76 ------------ 12.47
73 ------------ 12.03
78 ------ --- - 12.31
86 ---- -- --- 11.24
(4) (5) (6)
Cis. per lb. Cts. per lb.
78------ 12.54 I .. . ------
73 11.99
.
87 ---------- 12 83
1110 14. 28
154 -__ ---- 14.66
147 --------- 14.67
14l 11.97
136 11 .60
139 - ------ 11.74
Sugar prices in
relation to
Prices of
all foods
1 8 6 2 - - - - - - - - - - - - - --------
1863----------------------
1864----------- - - - - - - - - -
3 8 9 ( 3 ------- _ _ . _ - - - - - -
1 8 6 7 ----------- - - - - - - - - - -
1 8 6 8 - - - - - - - --------
1869----------- ---------- ----
1870--------------------------------- - -
1871-------------------- -------------
1872------------------- ----------- --...
1878---------------------------------
1874------------------------------ -
1875------------------------ - ---------
1876--------------------- --------- -
1877------------------ -------------
1878---------- __
---------------------- -
1879--------------------- ---_ - - - - - - - - - - -
1 8 8 0 - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -
1 8 8 1 - - - - --------- - - - - - - -------------
1882------------ ------------------------
1883--------------------------------------
1884------------------------------- _-
1885---------------------
1886-----------._------------------------
1887---------------------- _ -- - -----
1888----------------------- ------------ -
1889----------------------- -------------
1890------------------------------------
1891------------------------------ - ------
1892---------------------- ------------
1893--------- ------------- - ------------
1894------------------- -------- ----
1895 ---------- ---- ---
1896---------------------- ------ -----
1897-----------------------------------
1898--------------------- _------ ----
1809----------- ----------------. 4 .92
1000--------------------- --------- 5.32
1901-------------------- ------------._ 5.05
- ------ 4.46-
1902
-------------
4.64
1903 ------------- -
1904------------------------ .__----- 4.77
1906-------------`---------------------- 5.26
1906-------------------- ----------- 4.52
1907------..____.__...------ 4.65
1908---- --------------- .-.---- 4.96
1909 - --- -- -- ---- - --------------------- 4.76
1910------- -------------------------------- 4.97
1911 --------------------------- 5.34
1912------ ---------------- ---------_ 5.04
1913---------------------------------_ 44: 268,
1914------------------------------------ - 4.68
1915---------------------------------- 5.56
1916 - ------------- 6.$6
1917-------------------- ------------------ 7.66
1918----------------------------------- 7.83
1919------------------------------------ 199.00
.00
1920-- -- --------------------- --------
1921----- 6.19
1922 5.93
1923------- --- - ------------- 8.41
H. Slept. 1848, 84-1--3
93 ---------- 9.02
84 ----------- 10.13
76 ------------ 8.92
69 ------------ 9.33
64 9.56
70 ----------- 6.59
70 ----------- 10.01
CA ------------ 11.94
70 8.81
69 6.72
64 ---------- 6.80
69 7.01
61 ----------- 6.75
60 ------------ 6.92
55 ---------- 8.24
58 ------------ 7.76
60 ------------ 8.27
60 _ 8.20
64 8.31
V - -----7.89
66 ------7.03
69 -------- 6.91
69 ----------- 7.62
68 ----- 6.65
72 6.46
Pr capita
disposable
income
------------
74 - 5.70 - ----------
79 ---------- 6.03 ---------
82 63 6.06 7.89
78 63 6.85 8.48
85 67 5.93 7.52
82 69 5.22 6.20
82 68 5.71 6.88
82 71 6.78 7.83
95 82 7.22 8.37
132 98 5.80 7.82
151 108 5.19 7.25
164 122 5.49 7.38
174 126 8.94 12.34
114 99 5.43 6.25
111 104 5.34 6.70
117 - 119 7.19 7.07
Approved For Release : CIA-RDP59-00224A000100250004-4
 Approved For Release : CIA-RDP59-00224A000100250004-4
onrl, monthly January tl Mall 195.1-Continued
TABL>J C.-- Wholesale sugar prices, index numbers of wholesale prices; of all foods
and wholesale sugar prices in relation to prices of all foods annually 1860 to 19:;44
1924_
1925-
1927-_-
928---
1930------
1931--___.
1932---
1933-._-_
[937_-__
1.939......
1941 --
;942--
943__--
1944_..__
1
1945-._-
1952------------ -------- ------- --
11153---_.--.._---.._ -------------
1')54 _-._---'-----. ---------- __..
1^155-January- -----------
I?ehrnary--- - ------------. --..-
14areh-------------------- -
January-March average --------._-
April----------- --------------------
May
Xnne---- ----------------------- ------
Index numbers
(1035--39-100)
Sugar prices in,
relation to---
8u,ar price,
net cash,
Nr=w York
Cf.. per 117.
Prices of
all foods
(wholesale)
Per capita
disposadlc
income
Prices of
all foods
Cls. per M.
Per capita
disposable
income
Cts. per lb.
7. 31
115
118
6.36
6. 19
5.45
126
123
4.33
4. 13
5.46
126-
26
4.33
4.33
5. 79
122
124
4.75
4.67
5. 52
128
126
4.31
4.:38
5.03
1211
132
3.99
3.81
4.132
114
117
4.05
3.!15
4. 43
95
'10
4.136
4.47
3.99
77,
'7S
5.18 5.32
4.32
77
5.61 6.17
4.44
89
4.99 5.55
4. 85
106
89
4.58 5.45
4.69
104
1111
4.51 4.84
4.73
108
197
4.38 4.42
4
48
93
98
82 4.57
4
.
4. 58
89
1115
.
5.15
4.36
4.33
112
4.81
3.87
4.92
105
136
4.69
3.62
5. 4.5
126
170
4. 33
3.21
5.49
1:35
190
4.07
2.89
5.46
133
206
4.11
2.65
5.39
134
209
4.02
2.58
6.34
165
219
3.84
2.8'1
8.12
206
228
3.94
3.56
7.60
222
249
3.42
3.05
7.81
202
245
3.87
3.19
7.84
207
264
3.79
2.97
8.21
232
285
3.54
2.88
8.45
229
294
3.69
2.87
8.55
219
30.3
3.90
2.80
8. 55
218
301
3.92
2.81
8.48
214
3.96
8.45
215
3. 93
8.38
212
3.95
-------------
1305'
8.38
215
------------
3.90
------------
8.38
213
3.93
------------
8.38
------------
-------------
------------
1860-99: Palmors Sugar illanual Concerning Sugar.
1900-55: Lamborn Sugar Market Report.
Column 3:
1860-1909: Whole Prices far 213 Years, Warren and Pearson.
1910-55: Index numbers of the Bureau of Labor Statistics converted to 1935-39;= tOO.
Column 4:
1910-28: Estimates by BA.E.
1929-51: Computed by B,).P: from data of U. S. Department of Commerce.
Column 5: Column (2) divido3 by column (3).
Column 6: Column (2) divided by column (4).
April-June average --------.-------
I Preiimtnary, at. annual rate-
Sources:
Column 2:
A-RDP59-00224A000100250004-4
 Approved For Release : CIA-RDP59-00224A000100250004-4
REVISION AND EXTENSION OF SUGAR ACT OF 1948 19
In relation to the price of other foods, the price of sugar in the
United States as in other countries of the world has declined greatly
during the past century and still continues to do so. Since 1940, for
instance, the wholesale price of all foods has increased much more
than the wholesale price of refined sugar. Last year, the wholesale
price of all foods was 141 percent higher than in 1940, whereas the
wholesale price of sugar was only 97 percent higher than in 1940.
Because of protective devices such as tariffs, exchange restrictions,
and production subsidies which are applied to sugar in almost every
major sugar-consuming country of the world, relatively little sugar is
sold in markets where it does not enjoy preferential treatment. As a
result of this market narrowness, the world market price of sugar
fluctuates widely and is very sensitive to relatively minor shortages
or surpluses in world production.
The sugar acts have eliminated the extremes of very high and very
low prices in the United States market. They have protected do-
mestic growers during long periods of price depression in the world
market and likewise have protected consumers during shorter but
sharper periods of price inflation in that market. Price stability pa's
helped assure adequate supplies to consumers and a market for 'a
definite quantity of production to producers.
The following table shows, monthly, beginning in. 1947, the world
market price for raw sugar, the price of raw and refined sugar in. this
country, and the price that would be in line with the price formula of
section 201 of the Sugar Act. It is interesting to note the stability
of domestic prices in relation to the world market and also the fact
that domestic sugar prices have remained well below the formula
price mentioned in the act;
Approved For Release : CIA-RDP59-00224A000100250004-4
 A proved For Release : CIA-RDP59-00224A000100250004-4
2P REVISION AND EXTENSION OF SUGAR ACT OF 1948
TAmx D.--Sugar prices: Raw and refined, rnontht9, January 1947 to date
[Cents per pound]
Refined sugar
(wholesale, New York)
New York,
duty paid
World,
free along-
side ship
Cuba
19,',7 January---------------------------- -----
26.03
03
8
February------------------- -
6. 12
2 5.03
8.20
.
02
8
March -----...------------
16.12
2 5.03
8.20
.
8. 18
April------------------------- -----------
16.18
18
8
May-------- --------------- ------------
1 6. 18
.
8.17
June_---------------------- -------
1 6. 18
25
03
8
26
8
23
July --------------- - ------------
18
16.
.
25.03
.
8.26
.
8
30
August------------------- --
16.30
15.03
8.38
.
8.39
Septemher---------------------------------------
1 6.32
25.03
8.40
8
59
October-------- ---- -
16.32
2 5.03 8.40
.
8.50
November------- -------------------
2 6.32
25.03 8.40
8.64
1)ecember---- --------------- ------------ ----
6.32
25.03 8.40
8.75
Average----------------------------------------
16.21
1948 -January ------------------------- ---------------
6. 65
3.96 8.21
8
85
Fi.hruary--------------------- -------------------
5.50
4.24 7.82
.
8.78
March ------------------------------.----------
5.42
4.26 7.75
8.75
A pril-----------------------------------------
5.35
4.43 7.75
8
87
May-------------------------------------------
5.14
4.27 7.60
.
8
94
June-------------------------- ---------- ----
5.35
4.06
I 7.51
.
9.01
July---------------------------------------
:x 69
4.10
7.75
9. 11
August-------------------------
5.78
4.41
7.76
9
15
Septrmber_-----_------------
5.66
4.39
7.75
.
9
16
October_-_--- ------------
5.65
4.32
7.75
.
9.11
Novembe----------------------------------- ----
5. 08
4.27
7.76
9.04
Dow.tuber----------------------------------- ---
5.66
4.03
7.75
9.00
U:'rage--------------------- ------------- ----
5.54
4.23
7.76
8.98
1949- -January---------------------- ------------ ----
7.99
8
97
February --------------------------------------
5.65
3.95
8.00
.
8
87
March----------------------
5.68
4. 17
7.96
.
8
90
April ------------
5.63
4.09
8.10
.
8.92
May.. ---------------------------------- ----
5. 78
4.04
8.02
8.89
June ----------------------------------------
5.86
4.08
7.87
8. 91
July-------------------------------------- ---
5.83
4.13
7.86
8. 86
August -___ --_-___-_-___
5.88
4.20
7.85
8.87
September-------------------- ------------- ---
6. 01
4. 19
7,90
8.92
October------------------- ------------- ---
6. 02
4.33
8.05
8
87
November
5.91
4.33
R.05
.
8.87
December-------------------- ------------- ----
5.74
4.39
8.05
8.82
Average ----------------------------------------
5.81
8.89
1960- January----------- -----------------
5.74
4.62
8.05 I
8.79
Febrrwry- - - ----------- ------- -------------
5.69
4.47
7.92 I
8.77
March -----------------
5.54
4.44
7. 74
8.80
April -_------------------------------- ----
5.53
4.37
7.70
8.80
May --------------- -------- ----------- ----
5.71
4.21
7.70
8.85
June ---------------
5.78
4.21
7.70
8.89
July--- -------------------------------------
6. 07
4.89
7.97 I
8.99
August -------------------------------- --
6. 25
5.83 I
8.22 1
9.06
September----- ------------------------------
6. 25
5.88
S.25 i
9.12
October------------------------_ ----------------
6.23
5.84
8.25
9.17
November---- --------------------------------.
6. 19
5.58
8.25
9.21
l)ecember- ----------------------------
6.30
5.36
-
S.25
--
9.34
5.93
4.9-8 _
5.00 I
---- ----8.98
1951-Jauuarp _-_-------.-----------------
6,09
5.22
8.25
9.49
February---------------------- .-.____----___-----
5.96
4.96
8.25
9.60
March-- ------------------------------
5.90
5.48
8.25
9.63
April ---------------- __ ----------------
5.81
5.57
8.25
9.64
May ----- ------- -----------------------------
6.36
6.62
8.40
9
69
June ------- ---
6.59
7.41 I
8.60
.
9.68
July- ------------------------------------
6.30
6.75
8.74
9.69
August ----------------------- ------------------
6.00
5.61
8.52
9.69
September--------------------------------------
6.00
5.52
8.50
9.75
October-------------------------------------- --
Sce footnotes at end of table, p. 21
6. 93
5.28
8. 25
9.79
IA-RDP59-00224A000100250004-4
 Approved ForARe5iol"FlP~c~1Q2001 0250004-4
TABLE D.-Sugar prates: Raw and refined, monthly, January 1947 to date--Con.
[Censs per pound]
1952-January----------------- ------- -------- ...------
February----- ------ --- ----- --------- - - - - -
M a r c h - - -
Ao ril-----
May-- --------------- - - - - - - - - - --------- - - - - -
. J u n e- - - - - ------------- - - - - - - - - ---------- --
July --------------..
August ------------_
------------------------- -
September ---------------------- --- -----------
October ------------- --------- --------------
November -------- ---------- --------- -----
December------ ------------- - - ---- ------
Average---------------------- -- ------------
1953-January--------------------------- - -- -----
February -------------- ------------------
March--------------------------
Alail._-------------- -------- - - -- -----
May ------------------- - - - - - - - -- - - - - - - -
J u n e- - - - - - - - - - - - - - - - - - -. _ - - - - - - - - - - - - - - - ------
July------------------- - - - - - - - - - - - -- - - - - -
A u g u s t - - - - - - - - - - - - - - - - - - - - - - - - - - - - ----._ - - - - - - -
S e p t e m b e r- - - - - - - - - - - - - - - - - - - - - - _ - - - - - - - - - -
O c t o b e r -- - - - - - - - - - - ------------------- -------
November-------------- ..--------- -
-------
December----------------------- ----
-------
1954-January -----------------------------
------
February ---------------------------
---- -
March ---------------------------------
-----
Arril---- ---------- ---- --- - _-- -
May -------------------------------------------
June------------------------------------ --------
July-------------------------------- ------
August---- -----------------------------
September -------------- -------
October -------------------------
November --------------------------- --------
December---------------------------------------
Average------------------ --------------
1955-January------------------------------- - -----
February ---------------------------- -------
March------------------------------
April------------------------- ---- ------ ------
May- -------------------------- ---- ------------
June --------------------------------------------
Refined sugar
Raw sugar
(wholesale, New York)
World,
Now York, free along-
Actual Adjusted 3
duty paid side ship
Cuba
(2) (3)
(4) (5)
5.97 4.83
8.25 9.85
5.79 4.84
8.25 9.88
6.06 5.67
8.38 9.70
5.80
4. 54
8.21
9.88
5.77
4.38
8.15
9.82
6. 16
4.30
8.38
9.82
6. 31
4.30
8.65
9.86
6. 21
4.24
8.65
9.87
6.43
4. 17
8.69
9.90
(i. 48
4.16
8.80
9.97
6.43
4.05
8.80
9.98
6.50
4.00
8.80
9.97
6.59
4.01
8.80
9.97
'
6.44
4.00
8.80
9.98
6.06
3.84
8.71
9.97
6.26
4.17
8.62
9.91
6.04
3.55
8.58
9.95
6.16
3.52
8.50
9.90
6.33
3.27
8.65
9.92
6.38
3.38
8.75
9.93
6.35
3.65
8.75
9.96
6.37
3.62
8.75
10.00
6. 41
3.60
8. 79
10.02
6.40
3.53
8.85
10.04
6.41
3.29
8.85
10.06.
V). 40
3.15
8.85
10.08
6.15
3. 10
8.69
10.04
6.05
3.27
8.65
10.04
--- 6.29
----- 3.41
8. 72
10.00
6.04
3.30
8.65
10.06
6. 06
3.39
8.65
10.04
6,18
3.28
8.73
10.03
6.19
3.36
8.80
1(1.01
6.10
3. 32
8.80
10.04
6. 1.5
3.27
8.80
10.05
6. 19
3.13
8.80
10.06
6.09
3. 18
8.80
10.04
5.08
3.21
8. 70
10:02
5.96
3.25
8.65
10.00
6.15
3.26
8. 65
10.01
5.96
3.19
8.65
- --
0.98
6.09
3. 26
8.72
1(1.03
==
5.96
_==3. 17
8.65
9.9#
=
5.94
3.17
8.62
9.98
5, 84
3.22
8.55
9.9#
5.82
3.31
8. 55
9.97
5.95
3.38
8.55
_-
6.02
3.26
8.55
_------_
I Average delivered price charged United States refiners by Commodity Credit Corporation.
2 Prices Paid to Cuba by CCC plus CCC's expenses of approximately 1 percent.
3 Adjusted for changes in Consumer's Price Index (Sugar Act Formula).
Definitions
The amendments contained in sections 1 through 4 of the bill revise
some of the definitions contained in title I of the Sugar Act of 1.948,
as amended. In general, these amendments are for the purpose of
clarifying definitions in It manner such that their literal wording will
Approved For Release : CIA-RDP59-00224A000100250004-4
 Approved For Release : CIA-RDP59-00224A000100250004-4
22 REVISION AND EXTENSION OF SUGAR ACT' OF 1948
be in keeping with the intent of the act, and to provide more specific
instructions for administering those provisions of the act dependent
upon definitions.
The first and second sections of the bill amend subsections (d) and
(e) of section 101 of the act. Subsection (d) defines raw sugar and
subsection (e) defines direct-consumption sugar. The amendments
clarify the present definitions with respect to the classification for
quota purposes of liquid sugar from domestic areas as either raw or
direct-consumption sugar. (The wording of the present definitions
is such that liquid sugar cannot technically be classified as either
raw or direct-consumption sugar. Consequently, a literal interpreta-
tion of the present definitions would permit liquid sugar of refined
quality from domestic off-shore areas to enter under the overall
quotas without regard to the direct-consumption ]imitations.) The
amendments to subsections (d) and (e) provide, that liquid sugar
irorn domestic areas would be classified as either raw or direct-con-
sumption sugar in accordance with the same principle that is applied
;o the quota classification of crystalline sugar. The amendments
;pacifically exclude from such classification liquid sugar from foreign
countries inasmuch as liquid sugar entries from such. areas are
limited by fixed quota,,..
Section 3 of the bill amends subsection (i) of section 101 of the act by
striking out the parenthetical word "(Clerget)". The word "Clerget"
refers to an analytical method and its deletion does not affect the
meaning of the term "total sugar content" which is defined in sub-
section. (i). Its deletion in the amendment, however, does relieve
the Secretary of Agriculture of requiring the use of a method (the
Clerget method) for determining sucrose in the measurement of total
sugar content, which 'is not the most accurate method for the con-
ditions under which its use is prescribed. The amendment .permits
the Secretary to specify more accurate methods for such determina-
tions.
Section 4 of the bill adds a new subsection (n) to section 1011 of the
act. The amendment defines the term "to be further refined or
improved in quality", which is contained in both the raw and the
direct-consumption sugar definitions and is a criterion for distinguish-
ing raw from direct-consumption sugar for quota purposes. The
definition of the term "to be further refined or improved in quality"
basically establishes tl.e minimum processing to which sugar must
be subjected before it can be classified as raw sugar. In the event
that there is any question as to the processes to which raw sugar is
to be subjected or as to the quality of the sugar being processed, the
amendment also provides the Secretary of Agriculture with authority
to hold hearings to determine whether specific processes to which
sugar is subjected meet the requirements of the standards established
by the amendment or whether sugar processed is of raw or direct-
consumption sugar quality. The amendment gives clearer guidance
to the Secretary of Agriculture in administering those provisions of
the act, which require him to cla4sify sugar as: raw or direct-consump-
tion for making the proper quot.ti charges. The amendment permits
the Secretary to consider the type and extent of processing and the
quality of sugar in addition to the use criterion contained in sub-
sections (d) and (e) in distinguislting raw sugar from direct-consump-
tion sugar.
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REVISION AND EXTENSION OF SUGAR ACT OF 1948 23
Price objective
Section 5 merely amends the base period for the consideration that
the Secretary is directed in section 201 of the act to give to the rela-
tionship between the wholesale price of refined sugar and the general
cost of living in the United States. The bill changes the base period
from 1947 to the now generally accepted statistical base period of
1947-49.
Quotas
Section 6 amends 202 (a) of the Sugar Act, which establishes the
quotas for the domestic areas. The present fixed quotas for those
areas are retained and, in addition, the domestic areas are assigned 50
percent of all increases in sugar requirements in excess of 8,350,000
short tons, raw value. The first 188,000 tons, or any part thereof, by
which quotas for the domestic areas are so increased in 1956 are
apportioned 45.2 percent to the domestic beet area; 42.6 percent CO the
mainland cane area; 10.6 percent to Puerto Rico; and 1.6 percent to
the Virgin Islands. Any additional increase in 1956 is apportioned on
the basis of the fixed quantities plus the percentage increases referred
to above. For 1957 and subsequent years, quotas for the domestic
areas are apportioned in the manner described above to the extent of
the quantity so apportioned in 1956 and any further increases are
apportioned in accord with the final quotas established for 1956.
Section 7 amends section 202 (c) of the act which relates to the
quotas for foreign countries other than the Republic of the Philippines.
The effect of section 6 of the bill with respect to these quotas, it will
be recalled, is to reduce participation in consumption requirements in
excess of 8,350,000 short tons from 100 percent under the present act
to 50 percent. In 1956, there are no changes in the provisions of the
bill relating to the sharing of the quota for foreign countries other than
the Republic, of the Philippines; but, beginning with 1957, Cuba
retains 96 percent and other such foreign countries 4 percent of the
quotas for such countries resulting from consumers' requirements of
8,350,000 short tons, or less, but Cuba receives 50 percent and the other
foreign. countries also receive 50 percent of the quotas for such coun-
tries which result from consumers' requirements in excess of 8,350,000
short tons; provided, however, that the quota for foreign countries
other than Cuba and the Republic of the Philippines shall be 175,000
short tons in 1957 and shall be increased by 45,000 short tons annually
thereafter.
The quota for foreign countries other than Cuba and the Republic of
the Philippines is apportioned in accord with the present act in 1956
but, beginning with the calendar year 1957, is apportioned by first
assigning to each such country whose average annual importations
during the years 1953 and 1954 were less than 1,000 short tons, a
proration equal to such average importations; second, assigning to
each such country whose average annual importations 'during those
years were more than 1,000 but less than 3,000 short tons, a pro-
ration of 2,000 tons in. addition to the basic proration assigned to such
countries below; and, third, by assigning to each such country whose
average annual importations during those years were more than 1,000
tons but less than 2,000 tons, a proration in. 1957 equal to its average
importations during 1953 and 1954 plus 30 percent thereof and for
each subsequent year such proration is increased by 30 percent of the
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VISION ANI) EXTENSION OF SUGAR ACI OF 1948
proration for the iinrnediately preceding calendar year and, fourth,
by apportioning the quota not otherwise prorated 37 percent. to the
Dominican Republic, 36 percent to Peru, 20 percent to Mexico, 5
percent to Nicaragua, and 2 percent to Haiti.
Section 8 of the bill amends section 202 of the act by the addition of
three subsections ((e), (f), and (g)), which relate to restrictions on
quotas for foreign countries under specified conditions.
Subsection (e) affects quotas of those foreign countries having
quotas in excess of 10, )00 short tons. The amendment provides that
!,'he quota of any such foreign country failing by more than 10 percent
to fill its quota or proration in any year during which the world price
of sugar exceeds the comestic price shall be reduced by an amount
equal to the amount by which the country failed to fill its quota or
proration, unless failu~e to do so was due to crop disaster or force
Inajeure, or under quota reduction would be contrary to the objectives-
of the act, as determined by the Secretary. The overall effect of the
amendment is to assure deliveries of sugar from foreign countries
when world conditions are such as to encourage sales of sugar in the
world market rather than to the United States market. The amend-
ment provides that any quota reductions shall be prorated to other
areas as though it were a deficit under section 204 of the act.
Subsection (f) affects quotas of those foreign countries that are not a
party to or bound by the International Sugar Agreement for the
Regulation of the Production and Marketing of Sugar (ratified by
and with the advice and consent of the U. S. Senate on April 29, 1954).
The amendment provides that the quota or proration of any such for-
eign countries shall not he increased above the level attained for the
calendar year 1956 unless the country becomes a party to the agree -
went not later than January 1, 1957. This amendment does not
affect the quotas of domestic areas or foreign countries that are bound
by the agreement.
Subsection (g) affects the quota of any foreign country which sub-
stantially restricts its importations of raw or processed agricultural
commodities from the United States by means of trade or similar-
barriers. The amendment authorizes the Secretary of Agriculture to
determine whether such barriers have resulted in substantial reduc-
tions in the importation of our agricultural commodities. In the
event that the Secretary does determine that a foreign country having
a quota has substantial],, reduced such importations, the quota of that
country will be suspenc~;ed in any year when the import restrictive
nioasures are in effect, except that the quota for Cuba shall not be
reduced below the minima provided in subsection 202 (d). The
amendment provides that the suspended quota shall be prorated to
other areas as though it were a deficit under section 204 of the act.
Proration of deficits
~icction 9 amends section 204 of the act which establishes the method
of prorating deficits. Tl c effect of the change is to prorate to domestic
areas alone, rather than to Cuba and domestic areas, any deficit in a
domestic sugar-producin area which occurs because of inability to
market that part of its c: iota resulting from the fixing of consumers'
requirements in excess of 8,350,000 short tons. A further change
directs the Secretary, in the event a domestic area is unable to fill its
proration of any deficit resulting from the fixing of consumers' re-
quirements in excess of 8,350,000 short tons, to apportion such un-
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REVISION AND EXTENSION OF SUGAR ACT
filled amount to such other domestic areas which are able to fill the
deficit and in the event there are no such areas, to add the appropriate
,quantity of sugar to the quota of Cuba.
Allotment of quotas or prorations
Section 10 amends section 205 (a) of the act by authorizing the
'Secretary, when he allots any quota or proration established for an
area, to consider in addition to the factors presently specified, and to
make appropriate allowance for the diverse effect of drought, storm,
flood, freeze, disease, insects, and other uncontrollable conditions
which seriously and broadly affect a general area served by the factory
or factories of such allottee.
.Direct-consumption sugar limitations
Section 11, in amending section 207 (a) of the act, provides that
portions of the quotas for Hawaii and Puerto Rico which may be
filled by direct-consumption sugar are to be increased in the same
proportion as the. quotas for those areas are increased and with respect
to Puerto Rico, that such increased in the direct-consumption portions
,of the quotas may be filled by either crystalline or liquid sugar but
restricts to crystalline sugar the filling of the present direct-consump-
tion portion of the Puerto Rico quota of 126,033 short tons.
Section 12 of the bill amends the limitations in section 207 (b) of
the act with respect to the direct-consumption sugar which apply to
the quotas of foreign countries other than Cuba and the Republic of
the Philippines by permitting countries with overall quotas of 7,000
short tons or less to fill their entire quotas with direct-consumption
sugar. The limitation to 1.36 percent of the sum of the quotas for
foreign countries other than the Philippines which under the net may
currently be filled with direct-consumption sugar by all foreign coun-
tries other than Cuba, and the Republic of the Philippines is made
applicable to all, such countries other than those whose total quotas
do not exceed. 7,000 short tons and is prorated on the basis of the
average importation of direct-consumption sugar during the years
1951, 1952, 1953, and 1954 from such countries.
Conditional payments to domestic producers
Section 13 of the bill amends the present restriction in section 301 (b)
of the act of the quantity of sugar which may be marketed or processed
from sugar beet or sugarcane grown on the farm of a producer to per-
mit the marketing or processing of additional sugar beets or sugarcane
into sugar for livestock feed in excess of the proportionate share for
the farm.
Section 1.4 of the bill amends section 302 (b) of the act by authorizing
the Secretary in determining proportionate shares with respect to
domestic sugar beet and sugarcane farms in addition to the considera-
tions provided in the present act to protect, to the extent practicable,
the interests of producers in any local producing area whose past pro-
duction has been adversely, seriously, and generally affected by
drought, storm, flood, freeze, disease, insects, or other similar abnormal
and uncontrollable conditions. He is also authorized, on application
of any owner of a farm in Puerto Rico, to transfer the sugarcane pro-
duction record for any parcel or parcels of land in that Commonwealth
Owned by such applicant to any other parcel or parcels owned by ap-
plicant if lie finds such transfer to be in the public interest because of
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~, REVISION AND EXTENSION OF SUGAR ACT OF 1948
more economic utilization of land resources, the conservation of soil
and water resources, or the fostering of greater diversification of agri-
cultural production.
Administratuve provisions
Section 15 of the bill adds a new subsection (b) to section 405 of the
act and designates the present section 405 as subsection (a). The
new subsection provides that any person whose sugar-processing
operations meet the requirements of subsection 101 (n) (sec. 4 of the
bill) and who imports and processes sugars, subsequently determined
to be of direct-consumption quality and in excess of direct-consumption
quotas, shall be penalized 1 cent per pound of such sugar. Since
sugar is often entered and partly or completely processed before a
cl+termination of its quality is made, it is possible that some sugar
subsequent to its processing will be determined to be direct-consump-
tion sugar. In the event that the direct-consumption sugar quota
for the area from which the sugar has been imported or brought into
the United States has been filled, it is necessary to provide a penalty
for violation of the direct-consumption .[imitations. The amendment
provides a penalty of szch magnitude as to make i', unprofitable to
process direct-consumption sugar in excess of the direct-consumption
limitations.
Section 16 of the bill amends section 407 of the act. '['be amend-
ment provides that the provisions of section 407 shall not apply to
persons whose services ;ire required for the administration of the act
in field offices and other governmental agencies. The application of
the provisions of section 107 to officials (State, county, and community
officials and employees) who do not have information that might aid
them in. investing or speculating in sugar has on occasion precluded
the Department of Agriculture from obtaining the services of persons
who are best qualified to serve in field offices. The difficulties have
been most acute and. embarassing in areas served by cooperative sugar
mills. The amendment does not remove the restrictions of section
407 front Washington officials who do have information that would be
of value in investing or speculating in sugar, but it does permit the
employment of State, county, and community committeemen and
employees who own stock in a sugar company or who are members of a
cooperative mill.
Section 17 of the bill inserts a new section 411, and renumbers the
present sections 411 and 412 of title IV of the act. 't'he new section
411 authorizes the Secretary of Agriculture to reconcile quotas covering
imports from. foreign countries with article 7 of the International
Sugar Agreement for the Regulation of the Production and Marketing
of Sugar (ratified by and with the advice and consent of the U. S.
Senate on April 23, 1954). The amendment restricts quotas of only
these countries that do not participate in the agreement, and permits
the Secretary to take similar action on the corresponding provisions
of successor agreements.
Periods for which bill is effective
Section 18 amends renumbered section 412 of the act and provides
for termination of the act on December 31, 1960, except that the
Secretary shall have power to make payments under title III on pro-
grains applicable for the crop year 1960 and previous crop years.
Section 21 extends to June 30, 1961, the period during which the
excise and import compensating tax is applicable to sugar.
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REVISION AND EXTENSION OF SUGAR A
Section 24 of the bill provides that amendments shall become ("free-
tive January 1, 1956, except as otherwise designated (sec. 7 of the bill
dealing with the quotas for foreign countries other than the Republic
of the Philippines which becomes effective in 1957 and sec. 19 which
becomes effective upon enactment), and except that required deter-
minations and regulations may be issued in 1955 for the calendar year
1956.
Loans, purchases, and other operations by Commodity Credit Corporation
Section 19 of the bill provides a new section 414 for the act and di-
rects Commodity Credit Corporation to carry out loans, purchases,
or other operations with respect to 100,000 short tons of sugar pro-
duced from the 1955 or previous crops in United States sugar-produc-
ing areas in order to help alleviate the excessive inventory situation
in those areas. Sugar acquired under such programs is to be disposed
of outside of the continental United States in a manner which will
not unduly interfere with normal marketings of sugar. Disposition
under the Agricultural Trade Development and Assistance Act of
1954, as amended, is specifically mentioned as a method of disposition.
Loans on sugar are of the usual nonrecourse nature of such loans for
other commodities under similar programs. Sugar acquired under
such programs is not subject to title [I of the act which concerns itself
with quota provisions.
Mandatory support at 90 percent of parity
Section 20 of the bill amends section 201 of the Agricultural Net of
1949, as amended (63 Stat. 1052; 68 Stat. 899, 912), by including sugar
beets and sugarcane in that section. The amendment provides that
the price of sugar beets or sugarcane shall be supported at 90 percent
of parity. Support is to be provided by means of loans or other
operations with respect to sugar derived from the processing of
proportionate shares of such sugar crops for the 1956 and subsequent
crops. Receipts of producers from byproducts and from Sugar Act
conditional payments are to be taken into consideration by the Secre-
tary of Agriculture in establishing rates which will reflect 90 percent
of the parity price for sugar beets or sugarcane. Any sugar acquired
under this amendment is not subject to the provisions of title II
(quotas and prorations) of the Sugar Act nor do the provisions of this
section affect in any way the provisions of section 201 and the Secre-
tary's obligation thereunder.
Amendments to the Internal Revenue Code
Section 22 of the bill amends section 4502 (4) of the 1954 Internal
Revenue Code. That section of the Internal Revenue Code defines
the term "total sugars" similarly to the term "total sugar content"
contained in section 101 (i) of the Sugar Act and in addition makes
reference to Customs Regulations of 1930, which have since been
superseded. The amendment in no way affects the meaning of the
term "total sugars" and permits the Treasury Department to use
methods that are most appropriate to the determination of total
sugars.
Section 23 of the bill amends section 4504 and 6418 (a) of the
Internal Revenue Code of 1.954. The amendments provide that the
import compensating tax on manufactured sugar imported into the
United States for use in the distillation of alcohol or for livestock
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22 REVISION AND EXTENSION OF SUGAR ACT OF 1948
feed may be refunded. Section 212 of the Sugar Act exempts from
quota control any sugar or liquid sugar used for such purposes.
However, tax exemption under the Internal Revenue Code has been
only partly consistent, with the quota exemption. The processing
tax (applicable to sugax manufactured in the United States) has been
refundable. on sugar used for livestock feed or for the distillation of
tilcohol, but the import compensating tax (appli(able to manufac-
tured sugar imported into the United States) has not been refundable
on sugar used for the same purpose. The amendment provides that
either the processing tax or the import compensating tax, whichever
is applicable, may be refunded on sugar used for livestock feed or for
the distillation of alcohol.
C]IANGES I:v EXISTING LAW
In compliance with i;lause 3 of rule XIII of the Rules of the House
of Representatives, changes in existing law made by the bill are shown
as follows (existing laav proposed to be omitted is enclosed in black
brackets, new matter is, printed in italic, and existing law in which no
change is proposed is shown in roman):
SUGAR ACT OF 1948, AS AMENDED
TITLE I--DEFINITIONS
SEC. 101. For the purposes of this Act, except title V-
(d) [The term "raw sugar" means any sugars which are principally of crystal-
line structure and which are to be further refined or improved in quality, and
any sugars which are principally not of crystalline structure, but which are to
be further refined or other. ise unproved in quality to produce any sugars prin-
cipally of crystalline structure.] The tern. "raw sugar" means any sugars
(exclusive of liquid sugar from foreign countries having liquid srigar quotas), whether
o.? not principally of crystali ine structure, which are to be ,further refined or improved
in quality to produce any szgars principally of crystalline structure or liquid sugar.
(e) [The term "direct-consumption sugar" means any sugars which are
principally of crystalline structure and which are not to be further refined or
otherwise improved in quality.] The term "direct-consumption sugar" means
any sugars principally of crystalline structure and any liquid sugar (exclusive of
liquid sugar from foreign countries having liquid sugar quotas), which are not to be
further refined or improved in quality.
(i) The term "total sugar contents" means the sum of the sucrose [(Clerget)]
acid reducing or invert sugars contained in any grade or tyhe of sugar or liquid
sugar.
(n) The term "to be further refined or improved in duality" means to be subjected
substantially to the processes of (1) affination or defecation, (2) clarification, and (3)
further purification by adsa?ption or crystallization. The Secretary is authorized,
in accordance with findings based on public hearings, to determine whether specific
processes to which sugars are subjected are sufficient to meet the requirements of this
paragraph (n) and whether sugars of specific qualities are raw sugar within the mean-
in.g of paragraph (d) of this . ection, or direct-consumption sugar within the meaning
of paragraph (e) of this section.
TITLE II-QUOTA PROVISIONS
Sirc. 201. The Secretary ,hall determine for each calendar year, beginning with
tie calendar year 1948, the amount of sugar needed to meet the requirements of
consumers in the continental United States; such determinations shall be made
during the month of Dec-'mher in each year for the succeeding calendar year
(in the case of the calendar year 1948, during the first ten days thereof) and at
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such other times during such calendar year as the Secretary may deem necessary
to. meet such requirements. In making such determinations the Secretary shall
use as a basis the quantity of direct-consumption sugar distributed for consump-
tion, as indicated by official statistics of the Department of Agriculture, during
the twelve-month period ending October 31 next preceding the calendar year for
which the determination is being made, and shall make allowances for a deficiency
or surplus in inventories of sugar, and for changes in consumption because of
changes in population and demand conditions, as computed from statistics
published by agencies of the Federal Government; and, in order that such deter-
rninations shall be made so as to protect the welfare of consumers and of those
engaged in the domestic sugar industry by providing such supply of sugar as will
be consumed at prices which will not be excessive to consumers and which will
fairly and equitably maintain and protect the welfare of the domestic sugar
industry, the Secretary, in making any such determination, in addition to the
consumption, inventory, population, and demand factors above specified and
the level and trend of consumer purchasing power, shall take into consideration
the relationship between the prices at wholesale for refined sugar that would
result from such determination and the general cost of living in the United States
as compared. with the relationship between prices at wholesale for refined sugar
and the general cost of living in the United States obtaining during [19=17 prior
to the termination of price control of sugar? 1917-49 as indicated by the Con-
sumers' Price Index as published by the Bureau of Labor Statistics of the
Department of Labor.
SEC. 202. Whenever a determination is made, pursuant to section 201, of the
amount of sugar needed to meet the requirements of consumers, the Secretary
shall establish quotas, or revise existing quotas-
(a) For domestic sugar-producing areas[,] : (1) For the calendar year 1956
by apportioning among such areas four million four hundred and forty-four
thousand short tons, raw value, as follows:
Short tons,
Area raw value
Domestic beet sugar ________________ 1,800,000
Mainland cane sugar -------------------------- ------------------ ==00,000
Hawaii -------------- -__ 1, 052, 000
Puerto Rico----------------- ---------------- ----------------- 1,080,000
Virgin Islands------------------------------------------------- 12,000
(2) For the calendar year 1956, by apportioning among such areas 50 per centum
of the amount by which the determination made pursuant to section 201 exceeds eight
million three hundred and fifty thousand short tons, raw value, as follows:
(A) The first one hundred and eighty-eight thousand short tons, raw value, or any
part thereof, by which quotas for the domestic areas are so increased shall be apportioned
15.2 per centam to the domestic beet area; 42.6 per centum to the mainland cane area;
10.6 per centum to Puerto Rico; and 1.6 per centam to the Virgin Islands; and
(II) Any additional amount shall be apportioned on the basis established in para-
graph (a) (1) as adjusted by subparagraph (A) of this paragraph (a) (2).
(3) For the calendar year 1957 and each subsequent calendar year, by apportioning
among such areas four million four hundred and forty-four thousand short tons, raw
value, in accordance with paragraph (a) (1) of this section and by adding thereto 50
per centam of the amount by which the determination mace pursuant to section 201
e ceeds eight million three hundred and fifty thousand short tons, raw value, apportioned
as follows: First, by apportioning in accordance with the provisions of paragraph (a)
(2) of this section an amount not in e Bess of the amount so apportioned in 1956, and
second, by apportioning the remainder, if any, in accordance with the final quotas
established ,for the calendar year 1956, pursuant to paragraphs (a) (1) and (a) (2) of
this section.
(b) For the Republic of the Philippines, in the amount of nine hundred and
fifty-two thousand short tons of sugar as specified in section 211 of the Philippine
Trade Act of 1946.
(c) [For] (1) For the calendar year 1956, for foreign countries other than the
Republic of the Philippines, by prorating among such countries an amount of
sugar, raw value, equal to the amount determined pursuant to section 201 less
the sum of the quotas established pursuant to subsections (a) and (b) of this
section, on the following basis:
Per
Country centam
Cuba---------------------------------------------------------------- 96
Foreign countries other than Cuba and the Republic of the Philippines--- - 4
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Ninety-five per centum of the quota for foreign countries other than Cuba
and the Republic of the ]:'hilippines shall be prorated among such countries on
the basis of the average amount imported from each such country within the
tuotas established for the years 1948, 1949, and 1950, except that a separate
proration need not be established for any country which entered less than 2
per centum of the average importations within the quotas for such years. The
amount; of the quota not so prorated may be filled by countries not receiving
separate prorations, but no such country shall enter an amount pursuant to
this subsection in excess of l per centum of the quota for foreign countries other
than Cuba and the Republic of the Philippines.
(2) For the calendar year 1957 and for each subsequent calendar year for foreign
countries other than the Republic of the Philippines, by prorating to Cuba 96 per
centum and to such other foreign countries 4 per centum of the amount of sugar, raw
value, by which eight million three hundred and fifty thousand short tons or such.
lesser amount as determiner pursuant lo section 201 exceeds the sum of four million
four hundred and forty-four thousand short tons, raw value, and the quota established
pursuant to subsection (b) of this section; and by prorating to Cuba 50 per centum,
and to foreign countries other than Cuba and the Republic of the Philippines 50 per
centum r,f the amount of sugar, raw value, by which the amount determined pursuant
to section 201 exceeds the sum of eight million three hundred and fifty thousand short
tans plus the increase in q stotas provided for in subsection (a) (3) of this section:
Provided, (i) That for the calendar year 1.957 the quota for foreign countries other than -
Cuba and the Republic of the Philippines shall be one hundred and seventy-five
thousand short tons, raw clue, and the quota for Cuba shall equal the sum of the
c uotas for foreign countries other than the Republic of the Philippines less one hundred
rnd seventy-five thousand snort tons, r~iw value; and (ii) that for the calendar year
1958 and each subsequent calendar year through 1960 the quote for foreign countries
ether than Cuba and the Republic of the. Philippines shall be increased forty-five
thousand short tons, raw venue, annually and the quota for Cuta shall equal the sum
of the quotas for foreign countries other than the Republic of the Philippines for such
year less the quota for foreign countries other than Cuba and the Republic of the
Philippines for such year.
The quota for foreign countries other than Cuba and the Republic of the Philippines
shall be prorated for the calendar year 1957 and for each subsequent calendar year as
jollows
(A) Each country whos, average annual importations into the United States
within the quota were less than one thousand short tons, raw value, during the years
953 and 1954 shall receive a proration equal to such average importations.
(B) Each country whose average annual importations into the, United States within
the quota were more than once thousand short tons but less than three thousand short
tons, raw value, during the years 1953 and 1954 shall receive each year two thousand
tons in addition to the basic tonnages prorated under subparagraphs (C) or (:D) hereof.
(C) Each country whose zverage annual importations into the United States within
the quota were one thousand short tons but less than two thousand short tons, raw
value, during the years 195 3 and 1954 shall receive a proration for 1957 equal to its
average importations for the calendar years 1953 and 1954 plus 30 per centum thereof
and for each calendar year subsequent to 1957 through 1960 ,the proration for each
such country shall be increased by an additional 30 per centum of its proration under
This subparagraph (C) for the immediately preceding calendar year.
(D) That part of the quota not otherwise prorated in subparagraphs (A), (B), and
C) above shall be prorated as follows:
(fountry Per C'en.tur2
Dominican Republic--------------------------------------------------
37
eru ---------------------------------------------------------------
36
1L7exico----------------------------------------------- ---------------
20
Nicaragua ---------------------------------------------- .--------------
UZaiti----------------
ii
(d) Notwithstanding tl e other provisions of this title II, the minimum quota
,stablished for Cuba, incl-iding increases resulting from deficits determined pur-
suant to section 204 (a), shall not be less than the following:
(1) 28.6 per centut i of the amount of sugar determined under section 201
when such amount is seven million four hundred thousand short tons or less;
and
(2) two million on- hundred and sixteen thousand short tons, when the
amount of sugar determined under section 201 is more than seven million
four hundred thousand short tons.
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quotas The domestic sugar-producing areas, established pursuant to the other
provisions of this title II, shall be reduced pro rata by such amounts as may be
required to establish such minimum, quota for Cuba.
(e) Whenever in any year any foreign country with a quota or proration thereof of
more than ten thousand short tons fails to fill such quota or proration by more than
10 per centum and at any time during such year the world price of sugar exceeds the
domestic price, the quota or proration thereof for such country for subsequent years
shall be reduced by an amount equal to the amount by which such country failed to fill
its quota or proration thereof, unless the Secretary finds that such failure was due to
crop disaster or force majeure or finds that such reduction would be contrary to the
objectives of this Act. Any reduction hereunder shall be prorated in the same manner
as deficits are prorated under section 204.
(f) No country shall have its quota or proration thereof increased above its quota or
proration thereof for the calendar year 1956 unless, on or before January 1, 1957, such
country becomes a party to and bound by the International Sugar Agreement for the
Regulation of the Production and Marketing of Sugar (ratified by and with the advice
and consent of the United States Senate on April 29, 1954).
(g) Notwithstanding any other provisions of law except paragraph (d) hereof, if the
Secretary determines that any country for which a sugar quota or proration thereof is
established herein causes a substantial reduction in the importation of any agricul-
tural commodity from the United States below the quantity imported during a represen-
tative period of years, in raw or manufactured form, through import quotas, import
taxes, exchange restrictions, or other trade restrictive measures, the sugar quota or
proration thereof for such country shall be suspended during each year when such
restrictive measures are at any time in effect and the portion of such quota or proration
thereof so suspended shall be prorated in the same manner as deficits are prorated
under section 204.
Svc. 204. (a) The Secretary shall from time to time determine whether, in
view of the current inventories of sugar, the estimated production from the acreage
of sugarcane or sugar beets planted, the normal marketings within a calendar year
of new-crop sugar, and other pertinent factors, any area will be unable to market
the quota for such area. If the Secretary finds that any domestic area or Cuba will
be unable to market the quota for such area, he shall revise the quotas for the
domestic areas and Cuba by prorating an amount of sugar equal to the deficit so
determined to the other such areas on the basis of the quotas then in effect: Pro-
vided, That any deficit in any domestic sugar-producing area occurring by reason of
inability to market that part of the quota for such area allotted under the provisions of
section 202 (a) (2) or the increases allotted under section 202 (a) (3) shall first be
prorated to other domestic areas on the basis of the quotas then in effect. If the
Secretary finds that the Republic of the Philippines will be unable to market the
quota for such area, he shall revise the quotas for Cuba and foreign countries
other than Cuba and the Republic of the Philippines by prorating an amour_ t of
sugar equal to the deficit so determined, as follows:
To Cuba, 96 per centurn; and
To foreign countries other than Cuba and the Republic of the Philippines,
4 per centum.
If the Secretary finds that foreign countries other than Cuba and the Republic
of the Philippines cannot fill the quota for such area, he shall increase the quota
for Cuba by an amount equal to the deficit.
Whenever the Secretary finds that any area will be unable to fill its proration
of any such deficit, he may apportion such unfilled amount on such basis and to
such areas as he determines is required to fill such deficit; except that in the case of
proration of any such deficit in any domestic sugar-producing area occurring by
reason of inability to market that part of the quota for such area allotted under and by
reason of section 202 (a) (2) or the increases allotted under section 202 (a) (3), the
Secretary shall apportion the unfilled amount on such basis and to such other domestic
areas as he determines is required to fill such deficit, and if he finds that no domestic
area will be able to supply such unfilled amount, he shall add it to the quota for Cuba.
* * * * * *
Suc. 205. (a) Whenever the Secretary finds that the allotment of any quota,
or protration thereof, established for any area pursuant to the provisions of this
Act, is necessary to assure an orderly and adequate flow of sugar or liquid sugar
in the channels of interstate or foreign commerce, or to prevent disorderly market-
ing or importation of sugar or liquid sugar, or to maintain a continuous and stable
supply of sugar or liquid sugar, or to afford all interested persons an equitable
opportunity to market sugar or liquid sugar within any area's quota, after such
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hearing and upon such notice as he may by regulations prescribe, lie shall make
allotments of such quota or, proration thereof by allotting to persons who market
or import sugar or liquid sugar, for such periods as lie may designate. the quantities
of sugar or liquid sugar which each such person may market in continental. United
5t:ates, the Territory of Hawaii, or Puerto Rico, or may import or bring into con-
tinental United States, for consumption therein. Allotments shall be made in
such manner and in such amounts as to provide a fair, efficient, and equitable
distribution of such quota or proration thereof, by taking into consideration the
processings of sugar or liquid sugar from sugar beets or sugarcane to which pro-
portionate shares, determined pursuant to the provisions of subsection (b) of
section 302, pertained; the past marketings or importations of each such person;
aid the ability of such person to market or import that portion of such quota or
p-oration thereof allotted to him. Ir making such allotments, the Secretary may
a,so take into consideration tnd make due allowance for the adverse effect of drought,
storm, flood, freeze, disease, insects. or? other similar abnormal and uncontrollable
conditions seriously and broadly affecting any general area served by the factory or
factories of such person. T]:e Secretary may also, upon such hearing and notice as
h'i may by regulations prescribe. revise or amend any such allotment upon the
same basis as the initial allotment wa l made.
SEC. 207. (a) Not more than twenty-nine thousand six hundred and sixteen
short tons, raw value, of the quota for Hawaii for any calendar year, plus an
amount equal to the same percentage of twenty-nine thousand six hundred and sixteen
snort tons, raw value, that thy. increase in the quota for Hawaii under section .202 is of
one million fifty-two thousand short tons, raw value may be filled by direct-consump-
tion sugar.
(b) Not more than one h indred and twenty-six thousandal d thirty-three short
tons, raw value, of the quota for Puerto Rico for any calendar year may be filled
by direct-consumption sugar[.] which shall be principally of crystalline structure,
plus an amount equal to the same percentage of one hundred twenty-six thousand and
thirty-three short tons, raw value, that the increase in the quota fir Puerto Rico under
section 202 is of one million eighty thousand short tons, raw value, which latter amount
may be filled by direct-cons.emption sugar whether or not principally of crystalline
structure.
(h) [The] (1) For the calendar year 1956, the quota for foreign countries other
than Cuba and the Republic of the Philippines may be filled by direct-consump-
ton sugar only to the extent of 1.36 per centum of the amount of sugar determined
pursuant to section 201 leoq the sum of the quotas established in subsections (a)
and (b) of section 202: Provided, That each such country shall be permitted to
enter an amount of direct-consumption sugar not less than the average amount
entered by it (luring the years 1948, 1949, and 1950.
(2) For the calendar year 1957 and each subsequent calendar year, the quota for
foreign countries other than Cuba and the Republic of the Philippines may 7e filled
b!) direct-consumption sugar to the extent of 1.36 per centum of the amount of sugar
determined pursuant to section 201 less the sum of the quotas established in sub-
sections (a) and (b) of section 202; Provided, That such limitation shall net apply
to countries receiving prorahons under Section 202 (c) of 7,000 short tons or less.
The direct-consumption portion of such quota which is sul ject to the 1.36 per centum
limitation referred to above shall be prorated to countries which receive prorations
under section 202 (c) of more than 7,000 short tons on the basis rf average imports
of direct-consumption sugar with the quota for the years 1951, 1952, 1953, and 195-1t.
* * * * * * *
TITLE III-CONDITIONAL-PAYMENT PROVISIONS
Src. 301. The Secretar:r is authorized to make paymerts on the following
conditions with respect to sugar or liquid sugar commercially recoverable from the
sugar beets or sugarcane 1,;rown on a farm for the extraction of sugar or liquid
sugar:
* * * * * * *
(b) That there shall not have been marketed (or processed), except for livestock
feed, or for the production of livestock feed, as determined by the Secretary, an amount
(in terns of planted acr(age, weight, or recoverable sugar content) of sugar
1 ,acts or sugarcane grown on the far n and used for the production of sugar or
lirruid sugar to be marketed in, or so as to compete with or otherwise directly
affect interstate or foreign commerce, in excess of the proportionate share for the
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REVISION AND EXTENSION OF SUGAR ACT OF 1948 33
farm, as determined by the Secretary pursuant to the provisions of section 302,
of the total quantity of sugar beets or sugarcane required to be processed to enable
the area in which such sugar beets or sugarcane are produced to meet the quota
(and provide a normal carry-over inventory) as estimated by the Secretary for
such area for the calendar year during which the larger part of the sugar or liquid
sugar from such crop normally would be marketed.
* * * * * *
Sr,c. 302. * * *
(b) In determining the proportionate shares with respect to a farm, the Secre-
tary may take into consideration the past production on the farm of sugar beets
and sugarcane marketed (or processed) within the proportionate share for the
extraction of sugar or liquid sugar and the ability to produce such sugar beets or
sugarcane, and the Secretary shall, insofar as practicable, protect the interests
of new producers and small producers and the interests of producers who are
cash tenants, share tenants, adherent planters, or share croppers [.1 and cf the
prod cers in any local prod king area whose past prod ction has been adversely,
seriously and generally affected by dro-ght, storm, flood, freeze, disease, insects, or
other similar abnormal and uncontrollable conditions. For the purposes of establishing
proportionate shares hereunder and in order to encourage wise use of land resources,
foster greater diversification of agric :ltural production, and promote the conservation
of soil and water resotrcer in Puerto Rico, the Secretary, on application of ant, owner
of a farm in Puerto Rico, is hereby authorized, whenever he determines it to be in the
public interest and to facilitate the sale or rental of land for other prod ctive purposes,
to transfer the sugarcane production record for any parcel or parcels of land in Puerto
Rico owned by the applicant to any other parcel or parcels of land owned by such
applicant in Puerto Rico.
* * * * * * *
T[TLE IV-GCNERAL PROVISIONS
SEc. 405. (a) Any person who knowingly violates, or attempts to violate, or
who knowingly particirates or aids in the violation of, any of the provisions of
section 209, or any person who brings or imports into t'e contine-ta' United
States direct-consumption sugar after the quantities s"e~ified in se-tion 207 lave
been fillcl, shall forfeit 0 t'-e United States the sum equal to t"ree times the
market value, at to e time of the commission of any such a?t, (a) of t' at eua- tity
of sugar or liquid su.rar by which any quota, proration, or allotment is e 'cede-l,
or ('.) of that qua-tity brought or imported into t" e continental United States
after tuu.e quantities sreaifie'l in se?tion 207 have been filled which forfeiture shall
be recoverable in a civil suit brought in t',e name of the Ifnited States.
(b) Any person whose sugar processing operations otherwise meet the rearirements
of section 101 (n) and who subjects to such processes sugar imported or brought into
the continental United States under a declaration that it is raw sugar but which
sugar subsequently is determined to be cf direct-consumption quality and to be in
excess of the direct-consumption portion of the applicable quota or proration or alH-
ment thereof, shall forfeit to the United States a sum equal to one cent per pm.nd far
each pound, raw value, of such sugar in excess of the direct-consumption portion of
the applicable quota or proration or allotment thereof, which forfeiture shall be recover-
able in a civil suit brought in the name of the United States.
* *
Sac. 407. No person shall, while acting in any official capacity in the ad-
ministration of this Act, invest or speculate in sugar or liquid sugar, contracts
relating thereto, or the stock or membership interests of any association or corpora-
tion engaged in the production or manufacturing of sugar or liquid sugar. Any
person violating this section shall upon conviction thereof be fined not more than
$10,000 or imprisoned not more than two years, or both. The provisions of this
section shall not apply to persons whose services are obtained pursuant to section 305.
* * * * * * *
SEC. 411. The Secretary is authorized to issue such regulations as may be neces-
sary to carry out article 7 of the International Sugar Agreement for the Regulation
of the Production and Marketing of Sugar (ratified by and with the advice and con-
sent of the United States Senate on April 29, 1954), restricting importations of
sugar into the United States from foreign countries not participating in such agree-
ment, or to carry out the corresponding provisions of any such future agreements
ratified by and with the advice and consent of the United States Senate.
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34 REVISION AND EXTENSION OF SUGAR ACT OF 1 948
[Sa'c. 411.] SEC. 412. Tie powers vested in the Secretary under this Act
shall terminate on December 31, [1956] 1960, except that the Secretary shall
have power to make payments under title III under programs applicable to the
crop year [1956] 1960 and previous crop years.
[Sac. 412.] SEC. 413. The provisions of this Act, except where an earlier effec-
tive date is provided for he-ein, shall become effective January 1, 1948. As pro-
vided in section 513 of the Sugar Act of 1937, the powers vested in the Secretary
under that Act shall terminate on December 31, 1947, except that the Secretary
shall have power to make payments under title III of that Act under programs
thereunder applicable to the crop year 1947 and previous crop years.
SEC. 414. (a) To alleviate the conditions which exist in the continental United
States sugar-producing areas by reason of the quantities of surplus over-quota sugar
produced in such areas, the Commodity Credit Corporation shall carry out loans,
purchases or other operations with respect to one hundred thousand short tons of sugar
produced from the 1955 or previous crops in such areas.
(b) Sugar acquired hereuxder shall be disposed of outside the continental United
States in such manner as the Corporation determines will not unduly interfere with
normal .marketings of sugar; including dispositions under the Agricultural Trade
Development and Assistance Act of 1.954, as amended.
(c) No borrower shall be personally liable for any deficiency arising from the sale
of the sugar securing any loan made under authority of this secti9n, unless such loan.
was obtained through fraudi.aent representations by the borrower. This provision
shall not, however, be const -ued to prevent Commodity Credit Corporation from
reau,iring the borrower to ass time liability for deficiencies in the quality or quantity
of sugar delivered under the oan, for failure to properly care for and preserve such
sugar, or for failure or refusai to deliver the sugar in accordance with the requirements
of the program.
(d) Sugar acquired hereunder shall not be subject to the provisions of title 11 of this
Act.
AMENDMENTS TO AGRICULTURAL. ACT OF 1949
sac. 201. The Secretary i,; authorizea and directed to make available (without
regard to the provisions of title 111) price support to producers for tung nuts,
honey, milk, butterfat, saga beets and sugarcane, and the products of milk and
butterfat as follows:
(a) Note-Repealed by Agricultural Act of 1954.
(b) ***
(c) ***
ldl The price of sugar bees and sugarcane, respectively, shall be supported at a
level of 90 per centum of the parity price therefor through loans, purchases or other
operations with respect to sugar derived from the processing of proportionate shares
of sugar beets or sugarcane of he 1956 and subsequent crops produced in the domestic
sugar producing areas of the United States. Loans, purchases, or other operations
with respect to such sugar shad be at such rates or prices as the Secretary determines,
after taking into account receipts of producers from byproducts and conditional pay-
ments, will reflect the equivalent of 90 per centum of the parity price either for sugar
beets or sugarcane. Sugar acquired hereunder shall not be subject to the provisions
of title II of the Sugar Act of 1948, as amended.
AMENDMENTS TO THE INTERNAL REVENUE CODE OF 1954
SEC. 4501
* =k
(e) TERMINATION of TAx. --No tax shall be imposed tinder this subchapter on
the manufacture, use, or importation of sugar or articles composed in chief value
of sugar after June 30, [19h7] 1961. Notwithstanding the provisions of sub-
section (a) or (b), no tax shall be imposed under this subchapter with respect to
unsold sugar held by a manufacturer on June 30, [1957] 1961, or with respect
to sugar or articles composec in chief value of sugar hold in customs custody or
control on such date. With respect to any sugar or articles composed in chief
value of sugar upon which tax imposed under subsection (b) has been paid and
which, on Time 30, [1957] 1961 are held by the importer and intended for sale
or other disposition, there sh3,11 be refunded (without interest) to such importer,
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REVISION AND EXTENSION OF SUGAR ACT OF 1948 35
subject to such regulations as may be prescribed by the Secretary or his delegate,
an amount equal to the tax paid with respect to such sugar or articles composed
in chief value of sugar.
SEC. 4502
(4) TOTAL suc.ARS.-The term "total sugars" means the total amount
of the sucrose [(Clerget)] and of the reducing or invert sugars. [The
total sugars contained in any grade or type of manufactured sugar shall
be ascertained in the manner prescribed in paragraphs 758, 759, 762, and
763 of the United States Customs Regulations (1931 edition).]
* * * *
SEC. 4504. IMPORT TAX IMPOSED AS TARIFF DUTY.
The tax imposed by section 4501 (b) shall be levied, assessed, collected, and
paid in the same manner as a duty imposed by the Tariff Act of 1930 and shall be
treated for the purposes of all provisions of law relating to the customs revenue
as a duty imposed by such Act, except that for the purposes of sections 336 and
350 of such Act such tax shall not be considered a duty or import restriction,
and except that no preference with respect to such tax shall be accorded any
articles imported or brought into the United States and except that such tax may
be subject to refunds as a tax under the provisions of section 6418 (a).
SEC. 6412. FLOOR STOCKS REFUNDS.
*
(d) SUGAR.-With respect to any sugar or articles composed in chief value of
sugar upon which tax imposed under section 4501 (b) has been paid and which,
on June 30, [1957] 1961, are held by the importer and intended for sale or other
disposition, a there shall be refunded (without interest) to such importer, subject
by the Secretarv or his delegate, an
to such re
amount equalto the tax paid with respecdt to such sugar or articles composed in
chief value of sugar.
SEC. 6418. SUGAR.
(a) USE As LIVESTOCK FEED OR FOR DISTILLATION OF ALcosOL.-Upon the
use of any manufactured sugar, or article manufactured therefrom, as livestock
feed, or in the production of livestock feed, or for the distillation of alcohol, there
shall be paid by the Secretary or his delegate to the person so using such manc-
factured sugar, or article manufactured therefrom, the amount of any tax paid
under section 4501 [(a)] with re~;pect thereto.
* * * *
* *
Note.-The amendments made heeby shall become effective January 1, 1956,
except as otherwise designated and except that required determinations ana regulations.
may be issued in 1955 for the calendar year 1956.
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