I. A. A. RECORD — November, 1933 



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Corn-Hog Plan i 



immediate belief From Low Prices May Come If Govern- 

 ment Starts Substantial Buying To Feed Unemployed 



The long expected plan to raise com 

 and hog prices has at last been an- 

 nounced by Secretary Wallace. It will 

 be placed in operation beginning No- 

 vember 5 when the processing tax on 

 hogs goes into effect. 



The plan provides for bonus pay- 

 ments by the government of $5 per 

 head on 75 per cent of the average 

 number of hogs farrowed annually on 

 farms of contracting producers and 

 sold by each during 1932 and 1933, 

 provided the farmer reduces the num- 

 ber of litters farrowed and hogs sold 

 at least 25 per cent in 1934. 



The first payment of $2 per head is 

 to be made on acceptance of the con- 

 tract, $1 about Sept. 1, 1934, and $2 

 about Feb. 1, 1935. 



Farmers who agree to reduce their 

 com acreage in 1934 to not less than 

 20 per cent of the average annual 

 production in 1931-32-33 will receive 

 benefits in the form of a rental of 30 

 cents a bushel minus administrative 

 costs on the three-year average pro- 

 duction of the contracted acreage; 20c 

 per bushel to be paid soon after ac- 

 ceptance of contract and the remainder 

 following fulfillment of contract after 

 Aug. 1, 1934. ;. ,./;.-* 



H«w It Will Operate > 



The plan as announced will operate 

 about as follows: Farmer A during the 

 past three years has been producing 

 100 acres of 50 bushels an acre corn, 

 and raising two litters of pigs a year 

 from 16 sows (32 litters) from which 

 he has sold about 160 market hogs. 

 To come under the plan he must cut 

 his com acreage (20%) to 80 acres 

 or less, the number of litters (25%) 

 farrowed to 24 or less and the number 

 of hogs marketed to 120. If he car- 

 ries out this adjustment program he 

 will receive from the government 30 

 cents per bushel (minus local deduc- 

 tions) on 1,000 bushels of corn, the 

 average production on the 20 acres 

 left idle. He will also receive a bonus 

 of $5 per head on 120 hogs (75% of 

 the average number farrowed on farm 

 and sold). Thus, roughly, he will be 

 paid cash benefits for his co-operation 



in the corn-hog adjustment plan ap- 

 proximating |900. The cost of operat- 

 ing the county control association will 

 be deducted from the computed pay- 

 ments to local growers. 



In addition he will receive the in- 

 come from the 24 litters of pigs and 

 80 acres of corn. The market price of 

 both com and hogs should be raised 

 considerably in time if the crop reduc- 

 tion program is carried out as planned 

 and if non-co-operating farmers do 

 not take advantage of the situation to 

 step up production in the hope of in- 

 dividual profits. 



The grower who fails to fulfill his 

 contract forfeits his final payment and 

 must surrender also the initial pay- 

 ment. 



Basis of Allotments : v; ; 



Allotments of com and hogs will be 

 made to the various states and coun- 

 ties on down to the individual farmer. 



On the basis of information already 

 available through the Department of 

 Agriculture, each State will be allotted 

 for the purpose of determining pay- 

 ments: 



(a) That number of acres of corn 

 which represents its proportion of the 

 total number of acres to be withdrawn 

 from com production for the United 

 States. County allotments will be de- 

 termined on the same basis in rela- 

 tionship to the State. Within the coun- 

 ty, allotments to individual farmers 

 who have signed contracts will be 

 made by the County Corn-Hog Pro- 

 duction Control Association, and these 

 allotments will be published in the 

 county press. 



(b) That number of sows to far- 

 row, litters farrowed, and numbers to 

 be marketed, which will be propor- 

 tionate to the corresponding totals for 

 the United States. County allotments 

 will be determined on the same basis 

 as the State. Individual allotments 

 will be made by the Corn-Hog Produc- 

 tion Control Association, and publica- 

 tion will be made in the same manner 

 as on com. 



(c) A County Corn-Hog Produc- 

 tion Control Association which will 



choose its own directors and officers. 

 Any salaries or expenses which the 

 association is authorized by its direc- 

 tors to incur will be withheld pro rata 

 from the adjustment payments to be 

 made within the county. Extension 

 service agencies will be used wherever 

 available to assist in the educational 

 and organizational work. These may 

 be supplemented by temporary emer- 

 gency workers appointed to serve in 

 counties where additional help is re- 

 quired. 



> Government Baying ; 



In addition to the above proposals 

 the government promised further sup- 

 port to the market by subsequent pur- 

 chases of hogs and pork products for 

 poor and unemployed people through 

 the Federal Emergency Relief Cor- 

 poration. The extent of these pur- 

 chases may determine whether or not 

 any immediate improvement will be 

 felt in the hog market. 



To raise the funds for bonus pay- 

 ments to farmers the government will 

 place a processing tax on all live hogs 

 beginning November 5, of fifty cents 

 per cwt. Many predict that this pro- 

 cessing tax will result almost imme- 

 diately in a lower price to the grower. 

 According to an announcement by Sec- 

 retary Wallace, the processing tax will 

 be increased to $1.00 per cwt. by De- 

 cember 1; $1.50 by January 1 and 

 $2.00 on February 1. The tax also 

 will be placed on products held by 

 packers and wholesalers on November 

 5, but will not apply to floor stocks of 

 retailers. Tax collections on live hogs 

 through thie two-year period are ex- 

 pected to total $348,000,000. Hogs 

 butchered on the farm for use by the 

 farm family and employees will be 

 exempted from the tax. 



In addition there will be a 28c per 

 bu. tax levied on processed com and 

 later it is possible that a processing 

 tax will be applied to beef and other 

 products competing with both hogs 

 a,nd corn. The competitive condition 

 of com and hogs will also be protected 

 against imports. 



Every effort will be made to extend 

 foreign markets. Land rented by the 

 government and taken out of corn pro- 

 duction may be used for pasture, mea- 

 dow, soil improvement and erosion 

 prevention crops subject to the regu- 

 lations of the Secretary. 



As we go to press the Agricultural 

 Adjustment Administration through 

 Administrator Geo. N. Peek is quoted 

 as stating that loans will be made to 

 corn and wheat growers through the 

 Commodity Credit Corporation, where 

 grain is warehoused under bond; that 

 loans would be made at a rate "that 

 would increase farm prices." 



