Mr. HANSELL:

Does the reclaiming of rubber require a specially equipped plant?

Mr. HOWE:

Yes.

Mr. HANSELL:

And are our reclaiming processes running at full capacity?

Mr. HOWE:

Yes; we have two plants in Canada, and we send a good deal of scrap rubber to Akron, where it is reclaimed and sent back to Canada.

Mr. BENCE:

Yesterday I could not help feeling that a discouraging picture was given by the minister respecting the utilization of agricultural products in the manufacture of synthetic rubber. I feel that possibly the worst side of the picture was presented by the minister. As one who is keenly interested in this subject, which I believe to be of the utmost importance to the part of the country from which I come, I should like to obtain from the minister certain information before

War Appropriation-Supplies

I am prepared to accept in my own. mind the conclusion that the use of agricultural surpluses is not feasible.

Yesterday the minister gave some figures respecting the costs of manufacturing synthetic rubber from wheat. He stated it had been estimated1 that wheat to be used for this purpose would have to be purchased at 25 to 30 cents a bushel. I believe, his w.ords were "it is estimated"; and I also note that in the article he put on the record, which purported to be an answer to Dyson Carter, the same figures are given. Would the minister tell the committee who made the estimate? Was it made by an individual or a group of individuals? Who were they, and what had been their experience along these lines?

Apparently the determination of costs is a difficult matter. Mr. D. G. McKenzie, to whom I referred in my observations the other night, has stated that he discussed this matter with various research scientists, including some of the research foundations and the national research council, and found that he could not get any of these experts to express an opinion as to costs in terms of commercial production. The report made by the national committee of the Canadian chamber of commerce in a booklet called "A Survey of Canadian Research on the Utilization of Farm Products" states this at page 44 of its report, in connection with industrial alcohol:

There is no such thing as "the cost" of making alcohol, since it may vary with the size of plant, cost of raw materials, process used and utilization of by-products. The approximate cost figures under pre-war conditions were estimated to be 35 to 40 cents per gallon of alcohol at the distillery, if wheat at 60 cents per bushel is used.

These figures are somewhat lower than those given yesterday by the minister, and in a moment or two I shall have some questions to ask in that connection. For the information of hon. members and the public generally may I point out that this matter is by no means considered a hopeless one so far as the national research council is concerned. These questions were asked in the house by the hon. member for Souris (Mr. Ross) on April 15:

1. Have scientific investigations been carried on by national research council as to possibility of utilizing Canadian-grown cereals to produce butadiene which is used in manufacturing scientific rubber?

2. Has the department made scientific research into the possibility of producing alcohol, rubber, starch and other commodities, from certain foreign products?

3. If so, what have been the results?

4. What is the cost per pound of rubber made from wheat alcohol as compared to petroleum?

The answers given were as follows:

1. Yes.

2. Yes.

3. (a) Ethyl alcohol. No experimental work is being done on alcohol production from farm products since the general processes are already well established in industry. Information obtained from the wheat-alcohol commitee of the United States war production board is available to the national research council.

(b) Rubber. Promising results have been obtained from laboratory investigations on the production of butylene glycol from wheat and its conversion to butadiene. A pilot plant scheduled to operate in early summer is under construction. The purpose of this plant is to provide necessary data for the proper design of a full scale industrial plant.

(c) Starch. An improved process for the separation of starch and gluten from wheat flour has been developed on a large laboratory scale. Starch of high purity is obtained by this process without greatly changing the natural properties of the gluten.

4. Actual production costs are not at present available to the national research council.

This indicates that the question of cost is hard to determine. As Mr. McKenzie put it, so far as rubber production is concerned the research scientists are not in position to give an accurate estimate. From the discussion yesterday it would appear that there is a misconception in connection with the use of wheat. Reference was made to eighty cent and ninety cent wheat, and one member talked about dollar wheat. The position in this country is that we have a great deal of poor grade wheat which would cost considerably less than the price paid for No. 1 northern. There also seems to be a misconception in the minds of some hon. members of the house as to the amount of money obtained from the sale of wheat. We do not get ninety cents for our wheat because we are entitled to sell only 280,000,000 bushels.

Mr. REID:

In past years have the lower grades of wheat not been in greater demand on the coast than No. 1? In British Columbia for many years inferior wheat has cost more than the better grades.

Mr. BENCE:

I only wish we could obtain more money for the poorer grades of wheat than we do for No. 1. I can assure the hon. member that considerable quantities of the poorer grades of wheat in Saskatchewan would be available to British Columbia if they were ready to pay the No. I price for it.

Mr. REID:

We cannot always afford to pay that.

Mr. BENCE:

I do not think the poorer grade costs more.

It is a question of freight.

Mr. BENCE:

The freight costs might bring the cost of the poorer grades of wheat in British Columbia above what is paid for

War Appropriation-Supplies

No. 1 grade .in Saskatchewan. However if you transported No. 1 wheat along with other grades to British Columbia, the No. 1 wheat would cost more. We are capable of producing in western Canada much more wheat than the 280,000,000 bushels we are allowed to sell. Even though we may be able to get rid of all our wheat for a short time after the war, it may be that after a time we shall not again be able to dispose of all the wheat that we can produce. This is what has happened in past years. Therefore we may have to find something else to do with it. Then we may grow other agricultural products. Experiments are being made in the growing of the Russian dandelion- I do not know its technical name-out of which synthetic rubber is being produced in Russia. It may not be that this product can be grown on the western plains, but the fact is that we have a lot of land there and we are in position to grow many agricultural products that could be used.

Yesterday the minister suggested that the total production of the alcohol distilling plants in this country was sufficient to produce only one-third of the alcohol which would be required to produce the amount of rubber which will be manufactured from petroleum. This alcohol now being manufactured is produced from seven million bushels of wheat, consequently I take it that from 21,000,000 to 25,000,000 bushels would be required to produce sufficient alcohol to manufacture the same amount of rubber as will be made from petroleum. We have an ample supply of poor grade wheat to meet this demand and it seems to me that it could be used for this purpose.

Of course the Sarnia plant is established and will be a going concern this summer. However, the investigations that were carried on before the plant was established are matters with which we are all concerned when we consider whether we can have an alternative process. I do not think anything should be done to discourage the use of agricultural products until we have come to a definite conclusion that it is not possible to work out some feasible and economical scheme for the production of synthetic rubber from this base. In order to assist my understanding of the position I should like the minister to tell the committee at what time it was decided that the construction of the Sarnia plant should be proceeded with. What length of time before that was it that these men to whom he has referred were consulted as to the best process that should be used? Can he give us the names of those men? How many of them were consulted? Who consulted with them, so far as our administra-

tion is concerned? Were members of the national research council brought into the matter? Generally speaking I should like to have a clear picture of the whole discussion that took place before it was decided to go ahead. I should like to know also whether the representatives of the agricultural interests, that is on the scientific side, were called into consultation. Was this matter discussed with men in the United States who have been actually engaged in the production of this product from agricultural products? Who approached w'ho, if I can put it that way? Did the Canadian administration go to the United States and search out these men to obtain their advice, or were they approached from the outside with the suggestion as to what was the best thing that should be done? When he gave his statement yesterday the minister said, as reported on page 3701 of Hansard:

Taking grain at, say, eighty cents a bushel, the cost of production for industrial alcohol from grain would run. from fifty cents to sixty cents a gallon.

Mr. HOWE:

I said from 72 to 78 cents a gallon.

Mr. BENCE:

I am quoting the minister's

exact words as they appear on page 3701, but on the next page he is. reported as saying:

As I say, we bought some alcohol from our plants which cost us eighty-eight cents per gallon laid down at. Sarnia, but I believe the price at the distillery is somewhere between seventy-two to seventy-eight cents a gallon.

I should like an explanation of the disparity between those two statements. Is the fifty to sixty cent price based on eighty cent wheat, or is it the seventy-two to seventy-eight cent price that is based on that wheat? It is possible that the difference may be made up by the fact that the distilleries are selling alcohol which they are producing in their own plants and offering for sale to the government, while the other figure may have been an estimate of what it would cost in a plant established by the government. I should like to know whether a recent process known as the Park and Telford process was brought to the attention of the administration. I understand that a new process has been developed in the United States within the last four or five months which it is claimed will effect a saving of around ten cents per gallon in the production of alcohol from wheat, I believe this process eliminates the use of malt barley. Can the minister give us any information in connection with the plant which is being established at Thorold, Ontario, other than the information that was contained in the reply given to this house the other day, which merely was to the effect

War Appropriation-Supplies

that it would be operated by a company known as the Ontario Paper company; I think the name of the manager or president was also given. I would like to know what the approximate capacity of this plant will be, whether it is producing alcohol from wheat, and whether it is the kind of plant that can be turned over to the use and production of industrial alcohol from other products, such as molasses, when the war is over.

Mr. HOWE:

The Polymer corporation

was formed in February 1942, which fixes the approximate date when the studies of the rubber situation were in progress. Mr. Nicholson, who was at that time assistant controller of supplies, was directed by my department to organize the study. He associated with himself a board of scientists of the research laboratories, and one or two other competent scientists were added to it, of whom the head of the Ontario research laboratories was one, and also one or two industrial practising free lance chemists in Canada were added. It was as strong a board as could be obtained to go into all phases of the situation. This board or delegates from it went to the United States and obtained all the information available there. The United States at the same time was making similar studies. Anything which has been done in Canada has been based on the recommendations of that board.

The facts as set out by the board at that time have been confirmed by a number of recent studies. My hon. friend will remember the Baruch committee of the United States went very fully into the subject. That committee as I recall, was made up of Bernard Baruch, the chairman, president Conant of Harvard, and, I believe, Doctor Karl Compton, the president of the Massachusetts Institute of Technology. That committee reviewed the situation, and while it recommended that alcohol plants be built as an immediate source of butadiene to avoid delay in the programme, it confirmed the fact that the cheapest source of butadiene is petroleum.

' My hon. friend has asked me about the alcohol plant which is being opened this week. That was a private venture of the Ontario Paper company. The process is to recover the alcohol.content of the waste sulphate from a mill making sulphite paper and pulp. I believe the process came from Europe. It has now been worked out for the first time on this continent, and there is no doubt that it will produce alcohol; but until the process is in actual commercial operation, which it will be shortly, it is impossible to get any very accurate data on costs or other phases of that

method of producing alcohol. The production of alcohol from wood has, of course, been going on for a good many years.

What were the other questions?

Mr. BENCE:

I asked for an explanation of the difference in the figures given yesterday-

Mr. HOWE:

Oh, yes. When we are talking of 80 cent wheat, I think probably my hon. friend is thinking of 80 cent wheat at Fort William and I am thinking of 80 cent wheat at the plant. As my hon. friend knows, recent prices for wheat have been around $1 Fort William for No. 1 northern, plus the freight to Sarnia, and I presume that the 88 cent alcohol which we bought laid down at Sarnia involved at least a dollar for low grade wheat at the distilleries, plus the freight on the alcohol to Sarnia.

Mr. BENCE:

It seems pretty high for lower grade wheat.

Mr. HOWE:

Well, lower grade wheat is bringing a very good price. As my hon. friend knows, spreads are not very great these days.

Mr. BENGE:

Seventy cents basis Fort William.

Mr. HOWE:

Seventy cents at Fort William, plus freight to Toronto, plus freight to the nearest distillery; and1 after the alcohol is made it must be railed back to Sarnia in tank cars.