72 



quality discounts actually experienced by the farmer as they mar- 

 ket the 1993 crop? We will start right here and just go down the 

 table. 



Mr. DiEDRlCH. I am today representing the soybean industry 

 where the quality issue doesn't seem to be quite as big of an issue 

 as it is in, say, for instance com and wheat and so on, but I am 

 a farmer that raises both of those crops also, so I feel I can com- 

 ment on that anyway. 



I had low test weight com last year, averaged 45 pounds on my 

 farm. This year we had frost 2 weeks ago and corn was thinking 

 about deadening real strongly at that point. So I can guarantee my- 

 self that I am going to have low quality com again. So my answer 

 would be definitely. 



That corn, I am going to lose 30 to 50 cents in value on that 

 product. It is not a bulk commodity, it is price times bushels is 

 what gives you your income, so no doubt you have to, whether you 

 are in the crop insurance or whether you are in the disaster busi- 

 ness, that needs to be accounted for. 



Mrs. Hendricks. I agree with the statement in regard to the 

 corn crop of last year, had we not had a quality adjustment, it 

 would have been like 85 cents a bushel, very low, and vomitoxin 

 in the wheat, not even marketable. 



Mr. Kappes. The quality adjustments did a lot for the wheat 

 growers in Minnesota because we probably in many cases had ade- 

 quate bushels that wouldn't have been covered by Federal crop in- 

 surance had they not had a quality adjustment or disaster that it 

 had a quality adjustment, so it is very advantageous to boost the 

 price. 



Mrs. Hendricks. I agree with Mr. Kappes on that point also, and 

 on the wheat issues with the quality adjustments that the bushels 

 in our area were above the disaster thresholds, but with poor qual- 

 ity adjustments, then that fits our program. 



Mr. Gebhards. I am not real comfortable with understanding 

 how this quality adjustment is going to work on this crop yet, hard- 

 ly enough to comment on them. I would comment on quality adjust- 

 ments on CCC grain back in 1992, for example, that I talked about. 

 Several years ago, flooded grain would have been adjusted because 

 if you got, like I did, $1.05 for some grain that was flooded, I would 

 have to pay off the full loan value and so forth today. 



In the past, they covered unnatural disasters. I know of a farmer 

 that lost all of his grain bins, all of his com, everything. They were 

 broke. He lost his storage facilities, along with a lot of buildings 

 and other things. But this grain, as I understand it, if it was right 

 wouldn't be covered in this type of quality adjustment. I think that 

 maybe you should reconsider natural disasters as a part of the loan 

 commodity. 



Mr. POMEROY. Mr. Chairman, the only final comment I would 

 have, especially in light of the time to go over and vote, is an ex- 

 pression of appreciation. The input from your respective associa- 

 tions and individual producers has been vital for me to understand 

 what is happening, and how these programs are working. As a re- 

 sult, I and a number of other members of this subcommittee have 

 had substantial interaction with the USDA as the 1993 adjust- 

 ments and adjusting procedures have been developed. In the end. 



