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US Could Control Coffee Price Rise, Agency Head Says
Feb 2, 1954
Washington, D.C.- (/P) - Joseph M. Mehl, administrator of the commodity exchange authority, told senators Tuesday that his agency could stop "unwarranted" spurts in coffee prices if congress gave him the authority.
Mehl said he thought the coffee drinking public was "entitled to that protection" but that he had no authority now to investigate the rise in coffee prices.
He said he believed "speculation is inherent" in the coffee trade.
The senate agriculture committee is considering legislation by Senator Gillette (Dem., Iowa) which would authorize government supervision of coffee trade similar to that now operating over trading in wheat, cotton, corn and other commodities.
Demands for investigations and action have arisen with coffee growing past the $1 a pound mark and up to 15c a cup in some restaurants.
Brokers Oppose Plan
Earlier, two New York coffee brokers testified that government regulation might cut down supplies in this country and send coffee prices even higher.
Gustavo Lobo, jr., president of the New York Coffee and Sugar exchange, said in testimony prepared for the committee that restrictions on coffee trading in the United States might divert shipments to other world areas of heavy demand. For example, he said, consumption is increasing in west Germany, where the retail price is now $3 a pound.
Lobo told the senators that the coffee exchange, while convinced that regulation was not advisable, nevertheless would co-operate in every way if congress decided government supervision "can increase the world supply of coffee, or aid in bringing about lower prices for the American consumer."
Chandler A. Mackey, an importer, said the solution should lie in more coffee production rather than government regulation.
Chairman Alken (Rep., Vt.) made public a letter from the agriculture department endorsing the proposed supervision.
Tells of Protests
Gillette, unable to attend Wednesday's public hearing, sent a letter saying that an unidentified "firm of coffee brokers from Front st. in New York city" had warned him last July that retail coffee prices would climb to more than a dollar a pound.
The firm, Gillette said, wrote that Brazilian interests were forcing up coffee prices here by buying contracts for future delivery.
Alken, opening the hearing, said all congressmen were getting protests against the recent jump in coffee prices.
He said the wholesale price of coffee had gone up 17.5c a pound in the last year and retail prices had climed even more.