Evening star. [volume] (Washington, D.C.) 1854-1972, 1954-07-30
Demands In Congress
Rise for Coffee Price
Regulation by U. 5.

"A = CACA "a - 60O SOAAAA&AAkkoAoA4
report blaming high coffee prices
on speculation, lack of informa-
ton and market irregularities to-
day produced new congressional
demands for Government regula-
ton.
The report said that supply
and demand had nothing to do
with the soaring prices and rec
commended that the conditions
which caused them be corrected
by law. It's findings caused angry
protests from spokesman for the
coffee industry.
The ETC said frosts in Brazil
In July. 1853, had mo significant
effect" on the amount Of coffee
available this year. This had
been one of the principal reasons
given by coffee spokesman for
rising prices.
Although the report did not
place the total blame in one
particular spot, it said the large
coffee roasters contributed to
and helped maintain" the spiral
in green coffee prices.
1.-THE concentrated state of the
coffee roasting industry places
considerable power in the hands
of a few large roasters to inf1u-
ence price," the report said. en-
deed, the changes in the over
all pattern of industry activity
appear, during the period stu
died, to be assignable almost
wholly to the activities of the five
large coffee roasters."
big Five" Roasters.
These were identified in the
report as A. & P, General Foods,
Hills Brothers. Standard Brands
and Folger & Co.
1.-THE increased buying and &C
emulation of these and other
firms. especially the Nestle Co.,
contributed to and helped sus-
tain the spiral in the spot prices
of green coffee" the commission
said.
The ETC said such buying was
q significant factor" in the mar
ket at the time it was studied.
"In particular, the increased
purchases by General Foods
were of startling proportions"
the report said.
ETC said one of the conSe-
quences of rising prices may be
an even more concentrated do
nestle coffee industry, since
some of the smaller roaSters
could not afford to compete.
Sees Findings Upheld.
Senator Gillette, Democrat, of
Iowa, author of a bill to put the
New York Coffee and Sugar Ex-
change under Federal regulation
said in an interview today the
ETC finding confirms the
decision and judgment" of the
Senate Banking subcommittee
which investigated coffee prices
early this year.
IA combination of speculative
interests in Brazil and the
United States which manipu-
lated the market was chiefly
responsible for the rise in coffee
prices" Senator Gillette said.
'My amendment to put the
coffee exchange under Federal
regulation would be a great
help" xx.x f.Fs.sz4.
Democrat, of Missouri, said the
American public "has been TAX
ing a merciless beating on coffee
prices, based on a phony short
age which never existed"
Declaring that apparently
powerful interests" and mystic
rious reasons had blocked
congressional action so far, Mrs.
Sullivan said the Gillette pro-
posal is one needed remedy and
another is bill she introduced
to provide regular reports on
coffee stocks in this country.
Denounces Statements.
However, Gustave Lobo Jr.,
president of the Coffee and
Sugar Exchange, denounced
what he said were the FTC's
.malicious and unwarranted
statements about exchange oper-
atoms"
There is absolutely no justi-
fication for the inference" that
the Exchange sis responsible in
any way for increases in the
price of coffee" he said. 1.-THE
function of the Exchange is to
reflect prices and not make
them"
And Horacio Cintra Leite,
president of the Pan American
Coffee Bureau, said:
Speaking for the coffee-grow-
ing nations of Latin America, !
resent as offensive the statement
of the Federal Trade Commission
that our governments have en-
gagged in inadequate crop re-
porting If this implies that these
official reports were used to at
feet coffee prices. the Commits
sion's report contains funda-
mental errors in fact"
The Commission said its "full
resources" had been assigned to
the coffee investigation, ordered
last January 26, and that for
four months a team of investiga-
tors devoted full time to the
investigation.
The FTC said that while last
years frosts might affect next
LOST
BILLF0LD, mans. tan leather. contain
ing some money. many cards of iden-
kxA