BLACKSTRAP MOLASSES [Par. 502] STATEMENT OF J. H. CALDWELL, ST. LOUIS, MO., REPRESENTING THE MIXED FEED MANUFACTURERS Mr. CALDWELL. I am here representing the Ralston-Purina Mills of St. Louis, Mo., mixed feed manufacturers, as its vice president; also the Mixed Feed Manufacturers Association and the Merchants Exchange of St. Louis, Mo., as its president. I am not a speaker, nor the son of a speaker, but the son of a Texas dirt farmer, where I resided until I reached my majority. I am an ordinary business man, and I will try to tell you in my own way something about the mixed feed industry and the part that blackstrap molasses plays in that industry, and its relation to the farmer. In the allotted time that I have I shall touch only on the high spots. As I understand, Mr. Chairman, I will be permitted to submit a brief and go into more detail. The mixed feed industry is about 35 years old. Our company was a pioneer in the business, starting in a very small way and growing to rather large proportions. It passed through long years of struggle in its development to educate the feeder that it was necessary for his livestock, just like human beings, to have a balanced ration. The balanced ration idea was a new idea. The farmers and the feeders were naturally slow in accepting it, as the old idea of feeding straight grains had prevailed for a very long time. To-day, however, the agricultural colleges of this country as well as the farm bureau advisers are teaching the gospel of balanced rations, as it was found that the theory was sound and it was found also that it was practical in actual demonstration. To-day this industry represents over $200,000,000, and it produces annually more than 10,000,000 tons of feed, which are shipped to every corner of the United States, and even to some of our island possessions. Its representation in dollars and cents amounts to more than $400,000,000. That will give you an idea of the value of this industry. At least 6,000,000 tons of this enormous tonnage contains blackstrap molasses as its essential basic ingredient. You realize by this, gentlemen, what an important part blackstrap molasses plays in this, one of the greatest industries of our Nation. The United States produces less than one-twelfth of the total amount of blackstrap molasses required to produce this feed. Practically the entire production of beet molasses is required by the yeast manufacturers, and consequently is not available for the use of manufacturing feed. Blackstrap molasses is a residue obtained from the manufacture of sugar and is nonedible. Before its use in feed manufacture, it was considered a liability to the sugar manufacutrer. It was a waste. It cost them money to get rid of it, to destroy it. This enormous industry was built up on the basis of results obtained that is, the feed business: Namely, more milk in the pail per cow, more eggs in the basket per hen, more beef per steer, more pork per hog, and more quickly made and at a lower cost per pound than could be obtained in feeding straight grain rations. This is the basis on which the mixed-feed industry claims the right of its existence. Now, gentlemen, it can be easily seen that any increase in the duty on blackstrap molasses would affect every farmer and feeder and every penny of added cost to blackstrap molasses in the form of a duty must necessarily be passed on to the farmer and the feeder on account of the highly competitive nature of the business. Anything that would restrict the use of blackstrap molasses in mixed feeds would in the same proportion restrict the growing of alfalfa hay, and the production of alfalfa meal. Alfalfa meal can be used only in a limited way except as mixed with blackstrap molasses. So the restriction on the use of blackstrap molasses materially affects the alfalfa farmer of Colorado, Kansas, Nebraska, New Mexico, Wyoming, and Utah. Mr. Chairman, it was stated before this committee yesterday that blackstrap molasses was a substitute for corn, thereby reducing the consumption of corn. Actual feeding tests prove this to be an erroneous statement. We operate a large experimental farm near St. Louis. We put on a test last July to determine the value of our molasses feed as compared with that of cottonseed meal in fattening steers. We divided a lot of 48 steers into three lots of 16 each. Lot No. 1 was fed shell corn, alfalfa hay, cottonseed meal, and salt Lot No. 2 was fed shell corn, alfalfa hay, blackstrap molasses, and salt. Lot No. 3 was fed shell corn, alfalfa hay, special molasses, and salt The steers in lot No. 1 were not fed any molasses and consumed only 16.92 pounds of corn per day per steer during the entire 14 days' test. Lot No. 2 that was fed molasses feed with corn consumed 18.62 pounds of corn per day per steer. Lot No. 3 that was fed special molasses feed with corn consumed 18.11 pounds of corn per day per steer. Therefore, gentlemen, blackstrap molasses not only does not take the place of corn, but its use actually increases the consumption of corn. Blackstrap molasses increases palatability which naturally results in a greater consumption of grain, just as the molasses on your buckwheat cakes this morning increased the palatability of your buckwheats and the more you ate. It also increases digestibility. It results in a more rapid and healthful growth and quicker fattening By using blackstrap molasses steers can now be fattened and ready for the market in 90 to 120 days, whereas on a straight grain ration it takes nine months to a year to fatten them ready for the market. Generally speaking, Mr. Chairman, there can be no development of the mixed feed industry without blackstrap molasses any more than there could be a steel industry without pig iron, an electric industry without copper, or a fertilizer industry without potash and nitrate. Blackstrap molasses to the feeder is what mass production is to the automobile manufacturer. Gentlemen, the mixed feed industry is not objecting to a proper protection of edible molasses, but it is not in favor of any increase in the present duty on blackstrap molasses which, as stated before, is nonedible. What we are asking is merely the retention of paragraph 502, so far as it relates to blackstrap molasses, with an adjustment that will obviate the present necessity for manipulating such blackstrap molasses in bond, which constitutes a decided menace to the feed industry. This object can be accomplished if paragraph 502 is reenacted as follows: Paragraph 502: Molasses and sugar sirups, not specially provided for, testing not above 48 per centum total sugars, twenty-five one-hundredths of 1 cent per gallon; testing above 48 per centum total sugars, two-hundred-and-seventy-five one-thousandths of 1 cent additional for each per centum of total sugars and fractions of a per centum in proportion; molasses testing not above 56 per centum total sugars not imported to be commercially used for the extraction of sugar, or for human consumption, one-sixth of 1 cent per gallon. Mr. RAMSEYER. Mr. Caldwell, I want to ask you this question. How much of this blackstrap molasses do you mix with these cattle feeds? Mr. CALDWELL. That will depend entirely on what kind of feed you are making, for what kind of animal. Mr. RAMSEYER. I am talking about cattle; steers. Mr. CALDWELL. Feeding steers or feeding dairy cows? Mr. RAMSEYER. Steers. Mr. CALDWELL. It will range all the way from 20 to 50 per cent of the total feed. Mr. RAMSEYER. You mean to say that in a ton of feed, mixed feed, there will be half blackstrap? Mr. CALDWELL. In some cases. Mr. RAMSEYER. How many gallons? Mr. CALDWELL. There are 171 gallons in a ton. Half of that would be 85 gallons. Mr. RAMSEYER. Eighty-five gallons of blackstrap to mix a ton of feed? Mr. CALDWELL. Where it is feed for fattening steers. Mr. RAMSEYER. And for dairy? Mr. CALDWELL. Not for dairy cows, not that much. Mr. RAMSEYER. Well, I am asking you. Mr. CALDWELL. It runs a great deal higher, because we mix that Mr. RAMSEYER. You just gave me what it takes to mix feed for fattening steers. Now I want to know how much blackstrap you put in a ton of mixture for dairy cows. Mr. CALDWELL. It will run about 8 or 10 per cent of blackstrap. It is much lower for dairy cows. Mr. RAMSEYER. What do you pay for this blackstrap? Mr. CALDWELL. At the present time it is 102 cents a gallon f. o. b. the Gulf. Mr. RAMSEYER. That is with or without the duty? Mr. CALDWELL. With the duty. Mr. RAMSEYER. The blackstrap that you use for feeding purposes is chiefly imported? Mr. CALDWELL. It is chiefly imported, yes. There is only about one-fifteenth of it produced in this country. Mr. RAMSEYER. What per cent of the blackstrap that is produced. and imported goes into feeds? Mr. CALDWELL. Something over 100,000,000 gallons. Mr. RAMSEYER. And how much of that goes to the making of alcohol? Mr. CALDWELL. I do not know. I am not conversant with that subject. Mr. RAMSEYER. I have here a statement from the Tariff Commission which says that in recent years upward of 200,000,000 gallons of blackstrap molasses have been used annually in the production of alcohol. The next largest market for blackstrap molasses is the stockfeed industry which consumes approximately 50,000,000 gallons annually. Mr. CALDWELL. When was that written? Mr. RAMSEYER. That was just handed to us about two or three days ago. Mr. CALDWELL. I do not know anything about the alcohol business, but I know that it is erroneous as to the mixed-feed business. It is over 100,000,000. Mr. RAMSEYER. You think that there is twice as much used in the mixed feed business as the figure quoted here? Mr. CALDWELL. Yes, sir. Our company alone uses twice as much blackstrap as Louisiana produces. Mr. RAMSEYER. If the tariff is not changed on blackstrap that goes into mixed feed, would you have any objection to increasing the tariff on blackstrap that is brought into the country to be manufactured into alcohol? Mr. CALDWELL. That is a question that I have not studied at all. Mr. RAMSEYER. You are simply interested in getting blackstrap in here for your industry as cheaply as possible? Mr. CALDWELL. That is what I am interested in; yes, sir. Mr. RAMSEYER. Have you any understanding, implied or expressed with the industries that use blackstrap to convert into alcohol make a common cause here before the Committee on Ways and Means? Mr. CALDWELL. No, sir. Mr. RAMSEYER. To fight an increase in the tariff? Mr. CALDWELL. No, sir. Mr. RAMSEYER. You would be satisfied if the blackstrap duty were not increased for feed purposes but were increased for alcohol purposes? Mr. CALDWELL. Of course, I would naturally be satisfied if it was not increased for feed purposes. Mr. RAMSEYER. That is the only interest that you have? Mr. CALDWELL. That is the interest that I have; yes, sir. Mr. RAMSEYER. You have no interest directly of indirectly with the alcohol interests that use blackstrap for that purpose? Mr. CALDWELL. No, sir; none whatever. Mr. WATSON. You stated that you divided steers into three groups and gave each group different feeds. Do you recall the weight of those steers before you commenced to feed them and the weight after you stopped feeding them? Do you know what they gained in weight? Mr. CALDWELL. I have not that information with me. Mr. WATSON. If blackstrap is the best food for cattle, they must gain weight if you feed it to them. They must have increased weight or it is of no value. Mr. CALDWELL. This test, as I stated, was made to compare the value of molasses feed with the value of cottonseed meal in the feeding of cattle. Mr. WATSON. But you must have increased weight or else it is of no value. Mr. CALDWELL. We did. Mr. WATSON. Did you make a record of it? We have it at the office and it can be made a part of the testimony here. Mr. WATSON. Would you mind putting that in the brief? Mr. CALDWELL. We will be glad to. I have a copy of a part of it here. The CHAIRMAN. Put that in your remarks. Mr. CALDWELL. I stated it awhile ago. Mr. MARTIN. You use this blackstrap in making mixed feed? Mr. MARTIN. What proportions do you use? Mr. CALDWELL. As I answered the gentleman a while ago, it varies depending on the animal that is fed. For fattening steers it will run all the way from 20 to 50 per cent of the total feed, depending on the territory to which you are shipping. If you are shipping into the corn territory, the percentage of blackstrap molasses is increased, because they have their own corn to feed with it. If you are shipping it into the territory where they have not corn, it would not be so great, because we put a larger percentage of corn into it. Mr. MARTIN. What do you pay for your blackstrap now? Mr. CALDWELL. At the present time the market is 102 cents f. o. b. the ports per gallon. Mr. MARTIN. Where do you get your supply of blackstrap? Mr. MARTIN. That is delivered to you at 101⁄2 cents a gallon? Mr. CALDWELL. Ten and one-half cents a gallon at the present time f. o. b. cars at the American port. Mr. MARTIN. What duty do you pay on it now? Mr. CALDWELL. We pay one-sixth of a cent a gallon where it does not run over 52 total sugars. Mr. MARTIN. If it runs over 52 it is generally diluted; is it not? Mr. CALDWELL. Yes, sir; it is, and that is another thing we would like to get away from if we can. Mr. MARTIN. Get away from it in what way? Mr. CALDWELL. The manipulation of it, the dilution of it. If it runs above 56 total sugars, it is manipulated in bond, or mixed with water, to reduce the percentage of total sugars, so that the tariff will not be effective except at one-sixth of a cent per gallon. Mr. MARTIN. How much tariff is saved by the dilution? Mr. CALDWELL. It will be five-sixths of a cent a gallon on 56 total sugars. Mr. MARTIN. If the tariff were raised from two to four cents a gallon on this blackstrap, how much would that increase the cost of your feed per ton? Mr. CALDWELL. On steer-fattening feed that contains 50 per cent blackstrap Mr. MARTIN. You are taking the highest. Mr. CALDWELL. I am going to take that and go on down. 34120-29-VOL 5, SCHED 5-30 |