Message to the Congress Transmitting the Commodity Credit Corporation's Report for Fiscal Year 1965.

To the Congress of the United States:

The Commodity Credit Corporation is a useful instrument in America's effort to build a stronger economy, and a more secure foundation for world peace.

The CCC is the financial mechanism through which we share our food abundance with the hungry people of other nations.

It is a principal means through which we work to balance supply and demand, to maintain ever-normal granary reserves, to expand agricultural exports, and to provide a floor under the farmer's returns from commodity sales.

FOOD FOR FREEDOM

The Food for Freedom bill, now awaiting final Congressional action, is a firm expression of our national policy--and of the personal desire of most citizens to share our food abundance in the interest of world peace.

No longer is it our policy merely to share what is left over from cash markets. Rather, we shall plan our sharing in accord with the needs and best interests of the developing countries and their own resources.

But we know that we cannot provide for all the world's food needs, even if we were to bring every acre of American soil under cultivation. Thus our food aid programs must, and will, benefit those who demonstrate their willingness to help themselves by a deeper commitment to agricultural development.

SURPLUSES AND EXPORTS

Farm programs authorized by the Congress from 1961 through 1965 have helped farmers bring their production of surplus grains and other products into line with demand. They have enabled the CCC to reduce inventories that had grown too large. Storage and handling costs have been reduced $500,000 a day.

Surplus grain is no longer a threat to the livestock industry. Cash receipts from livestock products are up, and the outlook for the industry is bright.

Meanwhile, our exports of agricultural products are setting new records. They are expected to total 40 percent more this year than in 1960, due largely to tremendous increases in feed grains, wheat, and soybean exports. Farm commodity exports amount to one-fourth the value of all U.S. merchandise exported--and thus are vital in creating the foreign exchange necessary to carry on all of our business with foreign countries. The balance of payments problem is alleviated by our expanding agricultural exports that are aided in various ways through the Commodity Credit Corporation.

FARM INCOME

The domestic farm programs that have brought surpluses down have carried farm income up. In 1965, net farm income was fully a fifth higher than in 1960 and is expected to be up another billion dollars this year, reaching the highest level in history except for the postwar years of 1947 and 1948. Income per farm has risen 55 percent since 1960.

This is heartening progress, but we still have a long way to go toward our goal of full parity of income for the American farmer.

Though farm prices have increased 4 percent since 1960, they still are 14 percent below what they were in 1952. And this 4 percent increase in farm prices did not keep pace with the 8 percent increase in farm production costs during that same period.

And though the gap between farmer and non-farmer income was narrowed by 18 percent in the past five and a half years, farmers still earn only two-thirds per capita of what non-farmers earn.

We cannot rest until we have achieved full parity of income for the American farmer.

FUTURE PROSPECTS

With grain surpluses nearly gone and demands increasing, farmers now look forward eagerly to the opportunity to increase production. We have already increased the national rice acreage allotment by 10 percent and the national wheat allotment by 15 percent. We have twice increased the milk support price in recent months to encourage dairy farmers to remain on the land, to increase production, and thus to assure consumers a continued, adequate supply of dairy products. We are carefully watching farm commodity supply-demand situations, and we will use our program authorities to encourage increased production whenever this appears desirable.

The flexibility of the Food and Agriculture Act of 1965, and of the Commodity Credit Corporation, enables us to encourage increased or decreased production, as national needs and market conditions require.

The legislation now available, together with that nearing enactment, will help us continue our progress toward parity of income. That goal is no longer a long-range hope. It is within our reach--hopefully within this decade. It can be achieved not merely by the large and highly capitalized producers, but by all efficient family-type farmers regardless of race or geography.

Like all policy objectives of a truly great society, parity of income is a classless objective. for it will serve the best interests of every citizen.

We shall use such institutions as the Commodity Credit Corporation to work for parity of income. We shall strive to keep them dynamic and viable and ready, always, to meet our future needs.

It is a pleasure to transmit to you the Commodity Credit Corporation's report for 1965.

LYNDON B. JOHNSON

The White House

July 26, 1966