Evening star., 1936-07-26
MILK AGREEMENT
FOR D. c. WEIGHED
BY WALLACE AIDES
'Three-Week Study Begun.
Expected to Determine
Plans Fate Here.
1.CENT PRICE RISE
IS DUE If ADOPTED
Minimum Price Of $3.55 Per Hun
dredweight Likely Under
Program.
BY BLAIR BOLLES.

BY BLAIR DULLES.
Assistants Of Secretary Wallace be-
gan last night a three-week study
which will determine whether Wash
ington milk consumers are to feel
directly the workings of . still valid
portion of the agricultural adjustment
act.
On the conclusions reached by these
experts, Secretary Wallace, to a great
extent, will rely for his decision
whether 1t would be wise to invoke his
power to establish a milk marketing
agreement for washington.
Such an agreement would provide,
briefly, for Federal control, through a
governmentally appointed sdministra-
tor. over the supply of milk and the
price to be paid by distributors SELL
ing milk in the Capi<L.
The immediate result Of the pro-
mitigation of such an agreement would
be a l-cent-a-quart rise in the price
of milk to the Washington consumer.
The A. A. A. cannot Ak resale prices,
but distributors are expected to keep
their present margins OF olof,ts.
Minimum Price Likely.
As a result of testimony offered dur
ing the six-day hearing on the agree
ment in the Department of Agricul-
ture Auditorium, which ended yester-
day, it was held likely that the mini
mum price for milk would be set at
1855 a hundredweight, instead Of the
current level of s308 This is an in
crease of cents a gallon.
The Law sets the penalty for the
handler violating an agreement after
its issuance at from $50 to $500 for
each offense, unless the handler has
filed a petition with the Secretary of
Agriculture holding that the order
and agreement lis not in accordance
with law and praying for modifca-
ton thereof or to be exempted there
from"
The theory behind milk market con-
troll Is that Il stahilizes supply and
price and elimination Of the threat of
over-supply and demoralized market.
The agricultural adjustment act
amendments of last Summer, which
were unaffected by the Supreme
Courts HooSac Mills decision Of jan
uary 6, makes legal such control
agreements when they directly affect
interstate commerce and have the ap-
proval Of two-thirds of the shippers to
the market affected, or the shippers Of
two-thirds Of the total volume of milk
entering the market.
Held Interstate Commerce.
Since no milk sold in Washington
Is produced in Washington, marketing
the commodity here is considered by
istration a clear-cut instance Of inter-
state commerce.
That the agreement will have the
sanction of two-thirds of the farmers
is almost certain. despite the vociferous
objection Of most independent pro-
ducers. The control was sought by
the Maryland and Virginia Milk Pro-
ducers' Association cooperative of
1,100 dairy farmers. Independents
supplying the Capital number 800 at
the most.
The principal reason presented for
the prise rise is the rapidly increasing
cost of feeding dairy stock as a re-
suit of the drought. In large portions
Of the Washington milk-shed pastures
are barren fields, and farmers are
forced to purchase dry feed in large
quantities, unusual in Summer
months, to feed their stock.
~
the cost of the purchased feed has
increased since the first of June by
as much, in the case of certain mixed
feeds, as so per cent, it was testified
at the hearing.
Even the rains now in the North
west will not bring the feed prob
lem back to normal, for already, it
was testified, so much hay and corn
has been lost that feed will remain
high until next Spring.
Drought Hits Virginia.
The drought in the Washington
area has been particularly severe in
Virginia, which supplies about half
OF the Capitals milk. In the western
part Of Frederick County, Md. how
ever, the largest single-county pro-
ducer for Washington, both corn and
hay, are almost normal.
The problem Of Virginia is so acute
that Kone Brugh of the State Milk
Commission yesterday predicted 1t
would be necessary by September /
to order general advance in the
price Of milk sold in Virginia markets.
The two most serious problems
raised by issuance of an order put
ting the control agreement into eff
feet, the hearings brought out, would
be these:
1. Consumer price-The Washing
ton Consumers Council, the real
strength Of which is unknown, an
nounced that an increase In consumer
price would be appealed to Congerss.
Donald Montgomery, A. A. A. Con-
sumers' Council, has sent a question:
naire to all Washington distributors
to determine exactly what they pay for
milk. From this information Mont
gomery expects to learn whether a
farmer price rise could not well be
absorbed by the distributors.
2. Washington suburban markets.
Much milk processed and bottled in
Washington is sold in the Immediately
surrounding area. The Washington
distributor feels that this market is
rightfully his, but he would be SUBJ
ject to the price provisions OF the
marketing agreement and order. A
distributor with q plant on the out
skirts Of Washington, however, is not
subject to the agreement and order
1See MIX page R-21