Show BUSINESS sod end the STOCK MARKET by bv BABSON'S REPORTS J SETBACK IN INFLATION ANTI BATTLE The preliminary reading of the Wholesale Wholesale Whole Whole- sale Commodity Price Index spurted upward upward upward up up- ward in September erasing the dip of the previous month and suggesting fresh gains for the consumer price index Blame Blam could not be laid this time on push cost-push wage inflation or soarIng soaring soaring soar soar- ing defense expenditures The villain was in fact an unpredictable damaging damaging damaging ing of the 1970 corn crop by the spread of the southern corn leaf blight into the midwest Multifold Problem Added to the blight was an Infestation infestation infestation Infesta infesta- tion of corn borers and stalk rot all of which could mean abnormally high h harvesting rv sting losses losses' due to stalk break break- There was weather during much of July and August hastening has- has toning maturity of the crop in the western west- west o dern ern corn belt and permitting harvesting jat at a more rapid pace than is usual In Ins Ini i s many sections farmers are picking ahead f of schedule in order to minimize damage from the blight 1 Estimated Loss LossIn In an unusual move the Agriculture Department made a special supplementary tary lacy survey of the corn crop late in September Normally assessments are made at the start of each month in the growing season The inspection extra-inspection results results results re re- revealed early in October projected project- project f ed edan sn an outturn of nearly 42 billion bushels bushels bus bus- h hels s of corn for 1970 This was a drop of 13 per cent from the July early for forecast fore forecast fore fore- cast and five per cent below a prediction prediction prediction pre pre- diction made only three weeks before set at bushels as of September 23 compared with a prior forecast of nearly 76 bushels bushels- If the special projection projection pro pro- projection runs true to form the 1970 corn crop will be nine per cent smaller than the 1969 outturn of close to 46 billion bushels bushels- Last years year's per-acre per yield was wasa a record bushels As matters now stand the 1970 total shapes up as the smallest since 1966 Grain Prices Advance When news of the invasion of the blight became public the price of corn advanced rapidly Other feed grain prices prices ces were also driven upward including including including ing soybeans oats and sorghum Even the price of wheat a food grain moved moved moved ed higher As usually happens however however however how how- ever the initially violent price response to adverse developments soon bent to more basic considerations Hence despite despite de de- despite spite the fact that the special survey revealed somewhat more corn damage than the earlier report had implied grain prices have been mostly marking time Waiting For Final Tally Tilly Since weather Is particularly critical at this late stage of the crop year full extent of the blight damage will not be known until the harvest has been completed Wet weather could cause growth trouble and slow picking and there is the present ever danger of killer frosts But a sizable carryover carryover carry carry- over is In storage under government j loan and support price-support programs so there I t is no immediate threat of shortages Also the bumper soybean crop can be used if necessary to help out as a substitute substitute sub sub- for corn Implications For Consumers Consumer Fortunately ety because of the inflexible s status p i p supply-demand supply ratios for the nest term in cattle hogs fowl wheat soybeans and soybean meal a radical in food prices does not appear likely for the immediate future Adverse Adverse Implications from the corn blight loom more Important for 1971 when high feed feed costs may force livestock and poultry raisers to curtail herds and broods Such a contraction In supplies would I run up against a rising consumption l rate for meats and at least the higher feed costs would be passed on In the form of price markups An even more serious situation will develop If the blight infestation is not checked next year and and- the 1971 corn crop falls victim to a II second consecutive year of Inadequate outturn |