to testify today, is to see if we can figure out a plan to continue domestic mining. Senator DWORSHAK. The tungsten people have been coming back here for 3 years trying to work out their problems. Mr. DOLE. This is one of the ways I think that it might possibly be solved. I am not sure that it will, but I think it is a suggestion that offers some merit. Senator DwORSHAK. I agree with you that it would be highly advantageous to have sources of chrome production in this country so we would not have to be dependent upon chrome produced abroad. I am in complete accord with you on that thought, but on the other hand, so long as there is no long-range minerals program for all of the other minerals, I wonder why you feel that chrome would be entitled to some consideration by this committee, or GSA, or someone else? Mr. DOLE. It would be a step in the right direction. Senator DWORSHAK. That is not the point. It would be a step in the right direction if something were done to stabilize the production of all these other minerals, but recognizing that nothing has been done, on what basis are you building up any hopes that chrome will receive that consideration which has been denied other minerals? Mr. DOLE. You might call it hope. I think it is probably a lastditch stand, Senator. Senator BIBLE. Thank you, Senator Dworshak. Did you have anything further to add? Mr. DOLE. Nothing further. Senator BIBLE. I think your testimony has been very helpful to the committee. Thank you. Mr. DOLE. Thank you. Senator BIBLE. Our next witness will be, by request, because he has a commitment to make, Mr. William J. Barnhard, representing the American Importers of Brass & Copper Mill Products, Inc. Mr. Barnhard. STATEMENT OF WILLIAM J. BARNHARD, COUNSEL, AMERICAN IMPORTERS OF BRASS & COPPER MILL PRODUCTS, INC. Mr. BARNHARD. Mr. Chairman, my name is William J. Barnhard. I am a Washington attorney with the firm of Sharp & Bogan, whose address is 1108 16th Street NW. My firm has been retained as counsel for the American Importers of Brass & Copper Mill Products, Inc., 501 Fifth Avenue, New York City, an association which includes most of the major importers of copper and brass mill products. We had hoped that Walter S. Guggenheim, a director of the association and a vice president of Van Der Ryn International Corp., could have been here to testify, but because of the shortness of time it was impossible for him to do so. We recognize, Mr. Chairman, that your committee's concern is primarily directed to the mining of raw metals and minerals, including copper, and yet you cannot ignore the effect any action you may take will have on the use of that copper by fabricators. We recognize also that your committee's concern is primarily directed to the internal problem of strengthening America's mining industries, rather than the problem of possible import restrictions, and yet one of the major issues raised here by industry spokesmen has been the need for import restrictions. I am not in any sense an expert on mining-in fact I know virtually nothing about mining-and I will therefore be extremely brief in my statement here today. But I do know something about imports and the effect of import restrictions, and I would like to leave only this thought with the committee: The problems of the copper mining industry will not be solved, and indeed may be enlarged, by the use of import restrictions. The mining industry apparently needs help and I know the committee is diligently striving for a program that will provide the needed help. Of course, as this committee knows much better than I, the troubles in the mining industry are not localized in the United States. The identical problems exist throughout the world, in all countries producing copper. Obviously this worldwide decline is not the result of imports, any more than the United States copper decline is the result of imports. I would like to suggest that if imports are not the cause of the hurt to this industry, restrictions on imports are not the means to help the industry. Various proposals have been advanced to restrict imports of copper and copper products, the chief proposal being an import excise tax of 4 cents a pound whenever the domestic price drops below 30 cents. This is the proposal in S. 2998, now pending before the Committee on Finance. Identical bills are also before the House Committee on Ways and Means. These bills are obviously designed to establish a price-support program for copper. Experts in the industry tell me there is serious doubt whether such a tax will accomplish the desired result. But to the extent that it does, to the extent that it raises the price of copper above competitive levels, it will hurt rather than help the copper miners. The worldwide problem in copper is overproduction, or rather underconsumption. The answer to the problem is increased consumption. This depends on an increase in industrial productivity, an increase in housing starts, and an increase in the use of copper in furnishings, appliances, and the myriad uses to which copper is so well adapted. But it seems obvious that increasing use of copper will not be encouraged by increasing the price of copper. It is the high price of copper in recent years that has contributed substantially to the low state of copper today. Fabricators were encouraged, even forced, to find substitutes at prices that were commercially realistic. The tremendous growth in the use of aluminum by fabricators of many products was helped in large part by the high price of copper. And the possibility of new fluctuations in the price of copper is driving many fabricators to seek new substitutes for the red metal, even now when copper prices are relatively low. Where tables and other furniture used to be made with brass legs, today more often we find brass-plated steel. The Nation's electrification program, an important market, has been using ever larger quantities of aluminum in place of copper. The producers of shells are developing the use of plastics to replace the brass traditionally employed. Copper screens have been replaced by aluminum screens. The list of these changeovers is endless, and a current development which should be of serious concern to the copper industry is this morning's announcement that the price of aluminum will be dropped 2 cents a pound starting on Tuesday. This is the sort of problem that is really facing the copper industry. A very significant fact is that most of the fabricators who have turned from copper to some other material are not returning to copper even at today's low prices, largely because of the fear that copper prices will follow their traditional course and rise to new highs again. I should like to suggest to this committee, therefore, that you will not be helping the copper industry by forcing a price floor under the red metal. You will not be helping the copper miners by forcing all fabricators and consumers to pay a price dictated by the highest cost mine. You will not be helping the copper industry by pricing its products out of the market. Whether the answer to these problems lies in stockpiling or direct subsidy or some other program, I am not competent to say. But I do not think it lies in restructions on the small volume of net imports entering this market. Mr. Parsons the other day said this import excise tax was in the nature of handicapping; that is, when the United States horse became stronger, then the heavier weights would be removed from the foreign horse. The only thing he ignores in that example is that the weights on the horse may be so great that the paying audience will walk out of the race entirely. The proposed increase of $80 a ton will be, in the first instance, at the expense of the American consumer. But it will also be at the expense of the American miner, who will find his markets disappearing even more quickly than before. A concluding sentence, Mr. Chairman. I think a subsidy program that helps make our copper competitive is infinitely more helpful and plausible and less expensive than a price-support program that would make our copper even less competitive. Thank you, Mr. Chairman. Senator BIBLE. Thank you, Mr. Barnhard. I never heard of American Importers of Brass & Copper Mills Products, Inc. What is it? Mr. BARNHARD. This is a trade association which has among its members 17 major importers of copper and brass mill products. Their headquarters are in New York. Senator BIBLE. Who, for the record, are the 17 major importers of brass and copper products? Mr. BARNHARD. Sir, I do not have the list with me. Senator BIBLE. Could you furnish that for the record? Mr. BARNHARD. I will be happy to furnish it for the record, sir. (The members of the association are as follows:) MEMBERS OF AMERICAN IMPORTERS OF BRASS & COPPER MILL PRODUCTS, INC. The Alcobra Co., 1500 Calzona Street, Los Angeles, Calif. Atlantic Aluminum & Metal Distributors, Inc., 177 Page Boulevard, Springfield, Camarge Trading Co., Inc., 1512 Callowhill Street, Philadelphia, Pa. Norca Corp., 350 Fifth Avenue, New York, N. Y. The Ore & Chemical Corp., 80 Broad Street, New York, N. Y. Reynolds Fasteners, Inc., 68 Wall Street, New York, N. Y. S. Bernard Schwartz, 140 Cedar Street, New York, N. Y. State Metals Division, Wiwoco Corp., 76 Beaver Street, New York, N. Y. Vanderryn International, Inc., 160 Broadway, New York, N. Y. David L. Wilkoff Co., Inc., 150 Broadway, New York, N. Y. Senator BIBLE. Where are these importers located? Mr. BARNHARD. Mostly in the city of New York, sir, but they are scattered and some of them are located in other ports. Senator BIBLE. What do they import specifically? Mr. BARNHARD. A wide variety of brass mill products, copper tubing, brass tubing, plumbing goods, semimanufactures for the most part; that is, copper fabrications. Senator BIBLE. These are fabricated brass and copper products? Mr. BARNRARD. Yes, sir. Senator BIBLE. They are already fabricated? Mr. BARNHARD. Yes, sir. These are not importers of raw copper. Senator BIBLE. I understand. Where do they import these products from? Mr. BARNHARD. The major sources are the United Kingdom, West Germany, some from Sweden, and, to a lesser degree, other countries of Western Europe. Senator BIBLE. Could you advise us what the rates on these imports are of the various products that your 17 major companies import? Mr. BARNHARD. The tariff rates? Senator BIBLE. Yes, sir. Mr. BARNHARD. Yes, sir; I should be happy to. There is a great variety of rates, sir, since they are applicable to a great variety of mill products, but as a typical example, brass rods, the duty under the Trade Agreements Act is 2 cents a pound; brazed brass tubes, 6 cents a pound; seamless brass tubes, 2 cents a pound; brass wire, 121⁄2 percent ad valorem. On brazed copper tubes, it is 52 cents a pound; on seamless copper tubes, 32 cents a pound. These, I think, are the major items, although there are many other individual commodities which are brought in, sir. Senator BIBLE. What would be the approximate value of the brass and copper fabricated articles that are imported into the United States from abroad per year? Mr. BARNHARD. Sir, I am not sure of the value figures, but I can give you the quantity figures, both for imports and the domestic industry. The copper and brass mill industry is at a level of 2 billion pounds a year, while imports are running at the rate of slightly over 90 million pounds a year. Senator BIBLE. 90 million pounds a year? Mr. BARNHARD. Yes, as against 2 billion pounds from the domestic brass mill industry. Senator BIBLE. After you import these brass and copper products into the United States, they find their way into wholesale channels of trade? Mr. BARNHARD. For the most part; yes, sir. They go to jobbers usually; sometimes to fabricators, where tubing, for example, has to be further fabricated before it is ready for its final use. Senator BIBLE. I would be very happy to have you furnish a complete list of the ad valorem rates for the record. Mr. BARNHARD. Yes, sir; I will give you this complete list and furnish it for the record. (The information requested is as follows:) |