OCR Text |
Show ( i I ; I l LT l 1 1 f KITUA T I ( Tho sensational rise In tho prieo of all grains, led by wheat, litis been the feature of the farm markets. It rcllects a rapid change in the character of the crop reports, due to extreme heat and drought over an area which some observers estimate to include one-half to two-thirds of tho acreage devoted to the major grain and feed crops. Prior to the middle of .lime the moisture mois-ture supply and general growing conditions in the Spring wheat states and in Canada were favorable, favor-able, but since thffh a heat wave accompanied by high winds has caused cumulative damage. With these reports piling up, the market mar-ket gradually became inllamed until in the last week the forward for-ward months in the Chicago wheat market sold above a dollar dol-lar for the first time in nearly three years, corn above 00 cents, and oilier grains at corresponding correspond-ing advances. The damage to the spring wheat crop is the more important import-ant because it follows a reduction reduc-tion in tlio winter wheat crop to 311. OlHi.ilOO bushels, the smallest smal-lest figure since l'JO-1. The average av-erage expectation for spring wheat is around 200,000,000 bushels, and if this is materially reduced the crop will fall correspondingly corres-pondingly short of 000,000,000, j whereas the average domestic consumption for all purposes in recent years, exports not included, includ-ed, has been around 725,000,000. This situation has the possibilities possibili-ties of a great statistical improvement, im-provement, and a substantial reduction re-duction in the carryover of around 350,000,000 bushels which remains from the 1932 harvest. It affords a sound basis bas-is for the price rise, and the announcement an-nouncement of the measures to be employed in an effort to reduce re-duce the acreage next season, under the Farm Relief Act, is another important factor. The wheat situation in this country has been a distressing one, with the surplus mounting constantly over five years, and the mitigating factor to the losses loss-es in the drought regions is the improvement that will be worked in the situation as a whole. It is not the usual practice to welcome wel-come a bad crop, which raises the farmers' unit costs of production, pro-duction, gives less business along the line to the consumer, and raises the cost to the latter. However, the wheat growers for some time have been at a disadvantage, disad-vantage, and the larger return in dollars that they receive will help to restore their position in relation to other classes of the population, more effectively than if they had produced a more abundant crop at a lower cost. The effects of the advance on the general business situation should be entirely helpful. |