businesses which suffer subtantially or are closed as a result of actions in international trade. We are pleased to see the addition of Chapter 3, Adjustment Assistance for Firms, and recommend that the Bill as passed by the Senate include such provisions.

SUMMARY OF STATEMENT

1. The domestic Cordage Industry has had a smaller and smaller percentage of a shrinking market in cordage products from natural fibers.

2. Imports have continued to increase and now take 90.2% ($4.4 million) of the U.S. market in industrial twine and 92.9% ($33.4 million) in agricultural twine. 3. The agricultural twine situation illustrates how tariff decisions can reduce competition by elimination of domestic products, which leads to increasing the price the U.S. consumer must pay and to uncertainty as to supply.

4. The pattern of increased imports in natural-fiber cordage is now being repeated (as the Cordage Institute predicted in 1970) in the man-made-fiber cordage field and at an even greater rate.

5. We favor a Trade Reform Act such as H.R. 10710 with appropriate safeguards in the form of Congressional policy and standards for the exercise of the broad authorities granted.

6. We urge the establishment of standards of import injury under which action by the President to grant import relief would be mandatory.

7. We regard the improvement of classification and of statistical reporting by the Executive Branch as essential to the proper administration of the Trade Reform Act.

8. We urge caution in those duty and nonduty trade actions which might endanger small domestic industries.

9. The national-security test of Section 232 of the Trade Expansion Act referred to in Section 406 of H.R. 6767 should be broadened so that it encompasses any major damage to a domestic industry.

Respectfully submitted.

Hon. EARL L. BUTZ,

The Secretary of Agriculture,

Washington, D.C.

CORDAGE INSTITUTE,

Washington, D.C., October 11, 1973.

MY DEAR MR. SECRETARY: The purpose of this letter is to alert you to an increasingly short supply situation with regard to baler twine and to express our concern about the need for Federal action to prevent a catastrophic situation for U.S. farmers in 1974 and 1975.

The Cordage Institute represents substantially all of the manufacturers of rope and twine in the United States. The members of the Insttiute are not presently manufacturers of farm twine, but a potential for manufacture from synthetic fibers does exist within our industry. International Harvester Company, which works closely with us but is not a member of the Institute, is a major manufacturer of this product in the United States.

Natural fibers for the production of rope and twine have been in increasingly short supply as against a growing demand. This situation has been complicated by a drought in Tanzania, which produces about 31.5% of the world's production of sisal, the fiber from which farm twine has traditionally been manufactured. This shortage has been reflected in a doubling of the price of sisal fiber during the past year. This is, of course, reflected in the prices which the farmer must pay for twine to bind his crops.

It is the judgment of the Cordage Institute that there will be serious shortage of farm twine in 1974 and 1975. We are not in a position. however, to analyze the total supply/demand situation in order to appraise the exact nature and extent of the shortage. Many of the items of information required for such analysis, both on the international front and domestically, are beyond our control and our resources. We urge, however, that your Department conduct a supplyrequirements study to analyze the situation and to evaluate the possible courses of governmental action.

The Cordage Institute has been supporting a shift from natural fibers to synthetic fibers as the eventual solution to the problem of fiber supply for rope and twine manufacturing. There are at present, however, no economic incentives for the US. industry to develop additional production capability to meet the twine need. We have appealed to the Director of the Cost of Living Council for exemp tion of synthetic twines from price controls in Phase IV so as to provide manufacturers sufficient incentive to make the capital investments necessary to increase production.

I offer the assistance of the Cordage Institute in your review and evaluation of what we consider to be a serious national problem.

Very truly yours,

WILLIAM A. DUNGAN, President.

CORDAGE INSTITUTE EXHIBITS

Statistical and graphical illustrations (number 1-7), depicting the relationship of imports and U. S. production to the total U. S. hard-fiber market and showing rate of imports of cordage of man-made fibers.