mittee on Interior and Insular Affairs this statement of its strong endorsement and support of S. 289, the Lead-Zinc Act of 1967. As one of the nation's major producers of both lead and zinc, Idaho's mining industry is firmly convinced that the flexible import quota plan this legislation would authorize offers the best avenue thus far proposed for maintaining in this country the sound and stable market that is essential to preservation of a healthy and vigorous domestic lead-zinc industry. During the past few years our lead-zinc producers have enjoyed their fair share of the nation's economic prosperity, but they are gravely disturbed by ominous clouds which have developed since the fixed quotas established by proclamation in 1958 were removed by executive order in late 1965. The current upward trend of production, the marked increase in imports and the mounting levels of metal stocks are all threatening reminders of the severe depression the industry suffered in the late 1950's and early 1960's. Within the past year lead has dropped from 16 to 14¢ a pound and zinc, although still unchanged at 141⁄2¢, is under heavy pressure from record-high 1966 imports and growing surplus stocks. We believe the flexible quota plan provided by S. 289 would serve as an effective deterrent to excessive imports, thus providing protection against disastrous price declines. At the same time it would assure adequate supplies to the national economy at reasonable and equitable prices. During the recently-concluded 39th Session of the Idaho Legislature, a joint memorial was passed without dissenting vote urging Congress to formulate and adopt a national minerals policy embodying the principle of flexible import quotas. We are enclosing herewith a tear-sheet from the Idaho State Senate Journal of March 14 in which that joint memorial was printed and we respectfully request that the memorial be included in the hearing record with this statement as added evidence of Idaho's vital interest in this legislation. We strongly urge that S. 289 be given a favorable recommendation by your Committee and sincerely hope it will be enacted into law by the Congress. Very truly yours, A. J. TESKE, Secretary. (The resolution referred to was introduced also by Senator Jordan and follows his remarks.) Hon. HENRY M. JACKSON, NEVADA MINING ASSOCIATION, INC., Reno, Nev., March 31, 1967. Chairman, Senate Committee on Interior and Insular Affairs, Senate Office Building, Washington, D.O. DEAR SENATOR JACKSON: In line with our policy of backing the industry position, Nevada Mining Association endorses S. 289, the flexible lead-zinc import quota bill. In addition, I personally endorse passage of this bill. My experience over some 37 years in Nevada, California and Utah operations, which were adversely affected by violent fluctuations in lead and zinc metal market prices, demonstrated to me that our Government has not had a policy based upon anything but expediency and short range objectives. Certainly, our domestic lead-zinc producers have been and will continue to be the only guarantee against skyrocketing prices in times of shortage. Thus, it is clearly in the public interest to legislate some degree of protection for United States' producers during periods of excess foreign supplies which result in dumping, and to encourage exploration for and development of new mines. Respectfully yours, PAUL GEMMILL. MINING ASSOCIATION OF MONTANA, Hon. HENRY M. JACKSON, Chairman, Interior and Insular Affairs Committee, DEAR SENATOR: We, of the Mining Association of Montana, would like to go on record in support of Senate Bill No. 289, known as the "Lead & Zinc Act of 1967. The Lead & Zine industry in Montana is in need of the additional protection that this S. 289 Bill would give it and we will do everything in our power to help you and your fellow Senators to promote its passage. We hope the Senate Interior and Insular Affairs Committee will approve of S. 289 and the United States Congress will do likewise. Yours very truly, PETER J. ANTONIOLI, NORTHWEST MINING ASSOCIATION, Re S. 289: A bill to encourage stability and continuity in production of lead and zinc within the United States. Hon. HENRY M. JACKSON, Chairman, Committee on Interior and Insular Affairs, United States Senate, Washington, D.C. DEAR SENATOR JACKSON: During the Korean war American lead and zinc mines, shutdown earlier by low prices existing before that time, were unable to increase production of lead and zinc fast enough to supply the demand. A ceiling on domestic lead and zinc prices existed, but prices of lead and zinc imports skyrocketed to as high as forty cents a pound for zinc. American citizens were forced to pay inflated charges to foreign producers during war time. S. 289 is designed to prevent that from happening again by establishing flexible limits on imports which will maintain substantial domestic production of both metals. The accompanying price stability will assure the American people of dependable supplies of reasonably priced metals. Yours very truly, Re Flexible Lead-Zinc Quota Bill, S. 289. ESKIL ANDERSON, President. UTAH MINING ASSOCIATION, Chairman, Committee on Interior and Insular Affairs, United States Senate, Washington, D.C. DEAR SENATOR JACKSON: The Utah Mining Association fully endorses S. 289 as a measure which would, if enacted, serve to maintain a reasonably equitable market in the United States for domestically produced lead and zinc. Domestic producers are still painfully conscious of the excessive imports, depressing volumes of metal stocks and disastrously low metal prices prevailing in the domestic market from the middle 1950's to the early 1960's. The quotas on lead and zinc proclaimed by President Eisenhower in 1958 recognized and attempted to correct this flood, but recovery was extremely slow for the portion of the domestic industry which survived the deluge. It was not until 1964 that domestic prices began to reflect a return toward generally profitable levels. The average price of lead rose from 9.63¢ per pound in 1962 to 13.6 in 1964, and for zinc, in the same period, the price went from 11.625¢ to 13.57¢. High levels of lead and zinc consumption in the U.S. and Europe in 1964-1965 and the first portion of 1966 reduced stocks and firmed prices. However, trends toward surplus production, increased stocks of metals and lowered prices are again taking threatening shape. The domestic price of lead dropped 2¢ per pound in two 14 stages, May 5 and October 10, 1966. The price of zinc has remained at 14.5¢ since it reached that level in October, 1964. However, zinc stocks held by smelters and consumers in the U.S. increased from 38,300 tons at the end of February, 1966 to 99,900 tons at the same date in 1967. As a result of swelling stock levels and in anticipation of further surpluses, several American companies have announced cutbacks in slab zinc production totaling about 7,000 tons per month. The proposals contained in S. 289 are vitally needed now to offer protection against a recurrence of the damages sustained by the domestic lead-zinc production industry in the period briefly reviewed above. If the present trends toward surpluses, excessive imports and depressed prices fail to materialze, the 80-180-67- -8 measure, if enacted, would offer the domestic industry a comforting assurance similar to he holding of a policy with a good medical and hospital insurance firm. We respectfully urge your Committee to act favorably on S. 289. Very truly yours, MILES P. ROMNEY, Manager. NEW MEXICO MINING ASSOCIATION, Senator HENRY M. JACKSON, Chairman, Senate Interior and Insular Affairs Committee, New Senate Office Building, Washington, D.C. DEAR SENATOR JACKSON: The New Mexico Mining Association strongly supports S. 289-Lead-Zinc Import Quota Bill-which was introduced by Senator Clinton P. Anderson and others. The lead-zinc miners in New Mexico, like most other lead-zinc miners, have been subject to the ups and downs of the lead-zinc market, which have resulted for the most part from actions by foreign producers. Some degree of stability is sorely needed for the planning and programming of mining operations and production. As you well know, many approaches have been proposed to solve the dilemma faced by the lead-zinc industry. It is our belief that the flexible quota approach embodied in S. 289 provides the most reasonable and workable solution to this problem at the present time. In our opinion, it overcomes the major objections which were raised to the Import Quota Proclamation of 1958, and at the same time, protects domestic producers against the excessive foreign imports which have been so damaging to our domestic industry in the past. We commend Senator Anderson and the co-sponsors of S. 289 for introducing what we believe to be a very workable solution to our problems in New Mexico. Sincerely yours, WILLIAM F. DARMITZEL, Executive Director. TRI-STATE ZINC & LEAD ORE PRODUCERS ASSOCIATION, Senator HENRY M. JACKSON, Chairman, Committee on Interior and Insular Affairs, DEAR SENATOR: We here in the Tri-State District of Oklahoma, Kansas and Missouri are extremely concerned over the future outlook for the domestic lead and zinc mining industries. Mining operations in this area are carried on by one large company, The EaglePicher Company and about twenty-five to thirty small independent mine operators. The Eagle-Picher Company operates a large custom milling operation which purchases the ores produced by the smaller independent operators, since the small operators cannot afford to have mills of their own to produce a saleable zinc concentrate. The Eagle-Picher Company has mines of its own from which its ore is milled through this large custom mill, along with ores from the small producers. Without the ores produced from the Eagle-Picher mines this mill could not be operated economically because there would not be sufficient and consistent production from the small operations to maintain reasonable milling costs. The Eagle-Picher mines have been very marginal, and at times sub-marginal, for several years. If the prices of lead and zinc were to drop significantly, the Eagle-Picher Company would be forced to close both its mining and milling operations. The Small Producers Bill would maintan the prices received by the small producers for their ores, but without a market for these ores by virtue of EaglePicher's mill being shut down, they would also be forced out of business. As president of the Tri-State Zinc and Lead Ore Producers Association, I have appeared before many committees in Washington on behalf of the domestic lead and zinc industry, and I certainly worked very hard for the Small Producers Bill. However, in appearing before these various committees in behalf of this Small Producers Stabilization Act, I always made by position clear that even though the Small Producers Stabilization Act would be of great help to the Tri State District, it was not a complete cure for all the ills of the domestic lead and zinc industry. Therefore, Mr. Chairman, I urge the passage of S. 289 to maintain a necessary segment of the domestic lead-zinc mining and smelting industry and to encourage the exploration for and the development of new mineral reserves and to provide the consumer with adequate metal supplies. The Eagle-Picher Company's inventory of slab zinc has been steadily building up over the past three months. This is, we believe, due to the combination of a slow-down in the use of zinc metal in the United States and an increase of zinc imports in the United States from foreign sources; and this is in the face of a decreasing U.S. mine production. The threat of oversupply of the domestic market from imported lead and zinc becomes stronger each month with its attendant pressure on the lead and zinc price structure. Lead has already suffered price decreases and the increase in domestic inventories of zinc metal will almost surely lead to a decrease in the price of zinc. Some of the domestic producers of zinc have announced cutbacks in production, but our domestic zinc inventory buildup has not slowed. In view of these conditions we believe that it is imperative that import quotas be instituted so that the domestic miners, both large and small, can have a fair share of the domestic market for lead and zinc, instead of being forced out of business by imports when a decrease of domestic or world usage of these metals develop. Respectfully submitted. TOM KISER, President. Hon. HENRY M. JACKSON, INDEPENDENT ZINC ALLOYERS ASSOCIATION, April 24, 1967. Chairman, Senate Interior and Insular Affairs Commitee, 137 Old Senate Office Building, Washington, D.C. DEAR SENATOR JACKSON: The Independent Zinc Alloys Association attended the hearing of the Sub-Committee on Mines, Minerals and Materials on S. 289 on Wednesday, April 12, through its representative, Mr. R. M. Cooperman. Members of the Association are amongst the largest consumers of special high-grade slab zinc in the United States and sell approximately 50% of all zinc alloy marketed in this country. The Association presented no position at the hearing, because the bill and its ramifications were the subject of discussions at a general meeting of the membership on Sunday, April 16, in Miami, Florida. The IZAA recognizes the need for some control in the field of zinc imports into the United States. However, members feel that the remedies delineated in S. 289 are tied too closely to domestic industry production capabilities rather than to market conditions and concomitant imports. Our current concensus supports and endorses the positions made in the statement of Mr. J. Cordell Moore, Assistant Secretary for Mineral Resources of the Department of the Interior, before the Sub-Committee on April 12. We request that this statement be made a part of the record of the hearings before the Sub-Committee on that date. Respectfully yours, RICHARD J. BAUER, President. AMERICAN SMELTING & REFINING CO., Senator HENRY M. JACKSON, Washington, D.C. DEAR SENATOR JACKSON: I enclose a copy of our press release issued yesterday announcing the closing of our Van Stone mine at Colville, Washington. There has been a large increase in mine production of zinc, particularly in Canada, which is now reaching the market. At the same time, lagging demand in the United States, reflecting in part the decline in automobile production, has lead to a 40,000 ton build-up in producers' stocks over the last six months. As is always the case, this build-up in producers' stocks is putting severe pressure on the domestic price of zinc. Already, special high grade zinc imported from abroad is being widely offered in the U.S. market at substantial discounts from the U.S. price. We anticipate that this will be a growing problem in the months ahead. In the light of these facts, we reluctantly concluded that we must close the Van Stone mine for an indefinite period. New mine and mine expansion projects now scheduled will increase free world mine capacity to produce both lead and zinc by about 20% over the next three years. Unless demand for these metals experiences a parallel expansion, the lead and zinc industry will face some difficult readjustments. We have appreciated your support of the pending proposal to establish quotas on lead and zinc. Such legislation would help assure reasonable stability in the domestic market during this period of readjustment which lies ahead. With kind regards, Yours sincerely, CHARLES F. BARBER. [From the American Metal Market, Apr. 18, 1967] ASARCO TO SUSPEND PACIFIC NORTHWEST ZINC MINING SITE NEW YORK.-Due to lagging demand for zinc the American Smelting & Refining Co. will suspend operations at its Van Stone mine, effective May 1, E. McL. Tittmann, chairman of the board, announced yesterday. During 1966, the Van Stone mine, which is located at Colville, Wash., produced concentrates containing an average of 820 tons of zinc per month. "This action was indicated by the current market outlook and the buildup of producers' stocks of refined metal," Mr. Tittmann said. The mine will be shut down for an indefinite period. An open-pit operation, the Van Stone mine was first placed on stream by Asarco in 1952. Activities were suspended in mid-1957, and the mine remained closed until 1964 when it was re-activated to help meet increased market demand. The mine employs 55 men. ACME METAL Co., SMELTERS & REFINERS OF WHITE METALS, Hon. HENRY M. JACKSON, Senate Committee on Interior and Insular Affairs, DEAR SIR: This letter is in regard to Congressional bill H.R. 51 proposed by Congressman Aspinall, and identical Senate bill S. 289 proposed by Senators Anderson, Jackson, and Metcalf introduced on January 11, 1967. A public hearing has been scheduled for April 12th by the senate Subcommittee on Minerals, Materials, and Fuels. This bill seeks to protect domestic American mining and refining of lead and zinc by the imposition of a flexible quota. In other words when the economy gets down to bare bones, its the American producer who will be kept in business. But what about the American consumer, the user of Zine and Lead. This bill would deliver the future economic fate of the consumer into the hands of the producer by subjugating the supply needs of users to the considered best interest of the producer. What is good for the zinc and lead producer may be detrimental and opposed to the interest of the consumer and fair competition. Our particular position is that of a custom smelter of zinc slab into zinc Anodes for plating. The lead and zinc act of 1967 greatly favors ore imports over slab metal imports of zinc. This gives the few American refiners of ore great control of the supply at all times because custom smelters and other users cannot refine ore. The proposal provides that imposition and removal of the quota would be determined simply by the level of United States-domestic stocks held by producers. The only allowance made when considering quota removal other than producer's inventory would be the effect of strikes in the United States zine producing industry. In addition the bill provides that when stocks reach the level at which the quotas should be removed a three months waiting period must elapse before the quota can actually be removed. If consumer demand is high the results of this waiting period would bring dire economie consequences to the zinc consuming industry. When demand slackens we would not be in a position to buy American or any other zinc. It would seem that the sponsors of this bill assume that if a user needs zine or lead he has simply to order and receive. However many of the lead & zine producers in addition to mining and refining also |