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Show Supplies and Surpluses What's the Difference? The United States will have a record crop production this year. A Utah native, Dr. Quen-tin Quen-tin West, now with the Federal Feder-al Economics Research Ser- vice, speaking at Utah State University to persons attend-j attend-j ing the Utah Bankers Association Associ-ation Agricultural conference, made that prediction this year. His forecasts were for two billion bil-lion bushels of wheat, six and a half million bushels of corn and about that many soybeans. He said this brings up the big policy question1 of supplies sup-plies vs. surpluses. Both deal with the same thing, an abundance abun-dance of production, but they are looked at entirely differently. dif-ferently. At present, he noted, there are practically no carry over supplies of grains in the world. The United States used to have a buffer of surplus stocks, but other countries haven't carried car-ried surpluses. They have depended de-pended on ours. So the big question he raised was, "What kind of reserves shall we have and yet not get back to where we call them surpluses with all the problems that entails?" "Right now," he said, "most concerns are the other way around. We no longer have a buffer of surplus stocks. We are so directly inter-faced with the world market that we are immediately affected by what happens around the world. If we were to have a bad weather year around the world, prices would go out of the ceiling. But if there is good production around the world, we will see a slight decrease in food prices. "Traditionally, we in the U. S. have been a very open market country. Our philosophy philoso-phy has been a free market system. But we must recognize recog-nize that there has got to be a world policy on food preserves. preserv-es. "Our monetary situation is a factor. Though the dollar has recently strengthened, other countries are not anxious to acquire and hold dollars as they used to do when it was more sound. They have shifted their interest more to commodities com-modities such as gold, boosting boost-ing it to a world price of $185 an ounce, and other commodities commodi-ties besides the precious metals. me-tals. For example, they would rather have wheat than currency cur-rency for holding. This has caused prices to shoot up even when it seems they should be going down." "We expect to see wheat and other prices level off. Mair-nations Mair-nations can produce grain and are moving into production. We have the capacity to increase in-crease production of feed grains by double. I feel confident con-fident that other countries will be able to buy what they want. But that still doesn't eliminate the need for establishing a world food preserves policy," Dr. West stated. |
