Wheat situation

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Material Information

Title:
Wheat situation
Uniform Title:
Wheat situation (Washington, D.C.)
Physical Description:
v. : ; 26 cm.
Language:
English
Creator:
United States -- Dept. of Agriculture. -- Economics, Statistics, and Cooperatives Service
United States -- Dept. of Agriculture. -- Economics and Statistics Service
Publisher:
The Service
Place of Publication:
Washington, D.C.
Frequency:
quarterly
regular

Subjects

Subjects / Keywords:
Wheat trade -- Statistics -- Periodicals   ( lcsh )
Wheat trade -- Statistics -- Periodicals -- United States   ( lcsh )
Genre:
federal government publication   ( marcgt )
statistics   ( marcgt )

Notes

Statement of Responsibility:
Economics, Statistics, and Cooperatives Service, U.S. Department of Agriculture.
Dates or Sequential Designation:
WS-1 (Nov. 1936) - WS-254 (Nov. 1980)
Issuing Body:
Issued, 1936- by the Bureau of Agricultural Economics; <Oct.-Dec. 1953>-Feb. 1961 by the Agricultural Marketing Service; Apr. 1961-Nov. 1977 by the Economic Research Service, U.S. Dept. of Agriculture; Feb. 1978- by the Economics, Statistics and Coopertives Servie, U.S. Dept. of Agriculture; <Nov. 1980-> by the Economics and Statistics Service, U.S. Dept. of Agriculture.
General Note:
Cover title.

Record Information

Source Institution:
University of Florida
Rights Management:
All applicable rights reserved by the source institution and holding location.
Resource Identifier:
aleph - 000349017
oclc - 04015593
notis - ABY6688
lccn - 78643652 //r812
issn - 0364-2305
Classification:
lcc - HD9049.W3 U66a
ddc - 338.1/7/3110973
System ID:
AA00012162:00016

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Wheat outlook & situation


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THE


FOR RELEASE
AUG. 4, P. M.


SITUATION


BUREAU OF AGRIC HLTURAL ECONOMICS
UNITED STATES DEPARTMENT OF AGRICULTURE

OF-


WS. 112


JULY 1949


J S DEPARTMENT OF aA iC.LTuRE


1N E :. '.' E .- F u -. r:- I ''


Wheat prices have been below parity since May 1948, reflecting the near-record
harvests in the United States in 194- and 194Q and favorable crops in importing countries
in 1948. Wheat prices had oeen above parity from earl) ;lay 1946 to May 1948, except for
August 194E and February 194P. Since 1920, the) were also above parity in 1924-2.5.
1925-26, and 1936-37. In 1924, foreign demand for United States wheat increased as a
result of a very snall crop in Canada. In 1025. the crop in the United States was
small, and in 1936-37 United States supplies were greatly reduced following 4 years of
short crops. In World War I, the world supply was small compared with demand, and
prices in the United States rose considerably above parity. Since 1941, both the supply
and demand have been very large.


WHEAT: PRICE RECEIVED BY FARMERS AND PARITY
PRICE, UNITED STATES, BY MONTHS, 1909-48
CENTS
PER
BUSHEL
250 --1 Actual price


200 J Parity price*
I Base period. Aug. 1909- July 1914)

150 At' "- -"

100 J_..
50
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5 -- -

0 .l.. .1. I I
1910 1915 1920 1925 1930 1935 1940 1945
YEAR BEGINNING JULY
*PARIt PRICE NC'I AIanIIL Bi AM'ONTHS, 1910-22


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U S DEPARTMENT OF AGRICULTURE


NEG 1103 OFFICE OF FOREIGN S


The world's wheat-producing areas lie between latitudes 300 and 550 N. and 200 and 400 S. In these
areas, climatic and soil conditions are especially suitable for large-scale wheat production.
In 1946-48 the United States was the world's largest wheat producer, with China second, the U.S.S.R.
third, and Canada fourth. In 1935-39, the U.S.S.R. was first, the United States second, China third, and
India fourth.


WS-112 JULY 1949


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i THE WHEAT S I TUATION
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Approved by the Outlook and Situation Board, July 26, 1949

SSUMMARY

( Crop deterioration in June, which reduced wheat prospects by about
150 million bushels, lessened the distribution problems which wheat pro-
duoers had been facing. While the reduction in prospects has been great
enough to eliminate the necessity for marketing quotas, probable supplies
are still large enough to require acreage allotments for the 1950 crop.
The national total of the 1950 allotments was announced on July 14 at
68.9 million acres, or 17 percent less than the 83.2 million acres seeded
for the 1949 crop.

U. S. wheat supplies in 1949-50 are now estimated at 1,482 million
bushels--still large. With an..increase in the carry-over during 1948-1949
about offsetting the smaller crop, total supplies are about the same as
the 1,484 million bushels in 1948. Only in 1942 and 1943 were supplies
significantly greater than those of this year. Domestic disappearance may
total about 700 million, so that about 780 million would be available for
export in 1949-50 and carry-over July 1, 1950. If exports total 450 mil-
lion, the carry-over July 1, 1950 would be about 330 million bushels or
slightly larger than that on July 1, 1949.

Carry-over.stocks of old wheat in all positions on July 1, 1949
were about 293 million bushels. These are about 50 percent larger than
on July 1, 1948 and about 3 times as large as the very small carry-over
stocks in 1946 and 1947. They are, however, less than half of the peak
carry-overs of 631 million bushels in 1942 and 619 million in 1943.

In 1948-49, domestic disappearance totaled 691 million bushels
and exports 501 million. 'These items together with the carry-over
July 1, 1949 account for total 1948-49 supplies of 1,485 million bushels.
Wheat exports set a new high record for the fourth consecutive year.

Wheat prices are expected to advance gradually after the summer
peak in. market movement is past, and may average near the loan level for
the marketing year as a whole. The peak movement for the hard winter
area passed without becoming as heavy as expected. Losses from bad weather
and disease left many producers of hard winter heat with ample storage
space to care for the current crop. The price of No. 2 Hard Winter at
Kansas City dropped to $1.85 on July 2, or 35 cents under the loan rate.
Since then, prices have strengthened and on July 25 were up to $1.99.
SThis was 21 cents under the loan. The low point last year was about 18 cents
Sunder the loan.

Storage in the soft winter wheat areas has not been as readily
Available and&tbhe movement to market has been heavier and prices somewhat
Ieaker than 1i the hard winter area. The price of spring wheat is still
bove the loan. The seasonal.decline in spring wheat prices always occurs
Later in the year than the adjustment in winter heat prices because of
a: later ha*set dates.
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JULY 1949 -4 .

Indications continue to point to a 1949 bread grain output in Europe ":
excluding the Soviet Union about 5 percent below the 1948 level and more
than 10 percent below the 1935-39 average. Some increase in grain output
is expected in the Soviet Union as compared with last year, when wheat
production was 17 percent below prewar, Reports indicate, however, that
continued cool, rainy weather has delayed the ripening and harvesting of
grain in the European parts of the country.

A 1949 total wheat acreage for Canada was officially indicated on
July 21 at 27.5 million acres, an increase of 14 percent from the 24.1
million acres seeded a year ago. The condition for all Canada for wheat
on June 30 was 72 percent of the long-time average yield compared with
95 percent on the same date last year and 125 percent in 1947. The low
condition figure this.year is accounted for largely by.adverse moisture
conditions.

The International Wheat Agreement is now in effect, having been
ratified by the required number of nations. An organization meeting of the
Council was held in Washington on July 5.

THE DOMESTIC WHEAT SITUATION
BACKGBOUND.- An abnormal world demand for bread grains made it
possible to move the excess over domestic needs from four record
wheat crops produced in 1944-47, and to minimize the increase
in the size of the carry-over on July 1, 1948.

In 1932-41, the supply of wheat in continental United
States averaged 982 million bushels consisting of carry-in of
old wheat, 235; production, 733, and imports for domestic use,
9. Total disappearance averaged (21, consisting of food, 475; feed,
122; seed, 81; and exports and shipments 43. Carry-over stocks
at the end of this period were much larger than at the beginning.

Net exports from the United States have exceeded 300 mil-
lion bushels only in 1914-15, 1920-21, and each of the past 4 years
beginning in 1945-46. Very small United States wheat crops in
1933-36 together with drives toward greater self-sufficiency in
many importing countries greatly reduced exports in the 30's and
the war curtailed shipping in the early 40's. In the 35 years
since 1909, leaving out the years of net imports, net exports
averaged 169 million bushels.

Wheat prices to growers advanced from an average of 67 cents
per bushel in 1940-41 to a record of $2.81 in mid-January 1948,
and a record season average of $2.29 for the 1947 crop. From
1938 to late 1944 the loon program, which reflected the general
rise in prices farmers pay, was the most important factor in
domestic wheat prices. From 1942 through 1945 wheat feeding
was exceptionally heavy and very large quantities of wheat were
used for war industrial purposes. Beginning in early 1945 ex-
"ports, including shipments under various foreign ai t program, .
became the most important price-factor.



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55

In 1947-48, United States wheat prices reflected the re-
,: ; flected the unavailability of feed grains for export, the addi-
tional world demand resulting from short crops in importing
countries, and the continued rise in the general price level.
With the harvest of the near-record crop in 1948 and favorable
crops in importing countries, the loan program again became an
important price factor.

Wheat Supplies Fourth Largest of Record; Little
Change Expected in Carry-over July 1 1950

i:. U. S. wheat supplies in 1949-50 are now estimated at 1,482 mil-
, lion bushels. The current crop is estimated at 1,189 million bushels,
about 100 million bushels less than in 1948. This decrease in the size
of the crop is about offset by a larger carry-over, so that total supplies
are about the same as the 1,484 million bushels in 1948.

Domestic disappearance may total about 700 million bushels, con-
sisting of 485 for civilian and military food, 135 for feed, and 80 for
seed. In addition, shipments to Territories will be about 4 million.
Use for food will be about the same as in 1948-49. Feed use is expected
to be larger than last year because of the quantity of low quality grain
resulting from the wet harvest in the Southwest. The quantity for seed is
reduced in line with ,the. acreage allotments for 1949-50. The use for
distilled spirits, alcohol and malt beverages continues unimportant.

If total .supplies turn out to be about 1,482 million bushels, and
domestic disappearance totals 700 million, about 780 million will be
S available for export in 1949-50 and carry-over July 1, 1950. A preliminary
analysis of supplies and,requirements indicates that exports from the
United States may total about 450 million bushels. On this basis the
S carry-over July 1, 1950 would be about 330 million bushels, which would
be only slightly higher than on July 1, 1949. The size of exports will
depend in part upon the way crops finally turn out in both the exporting
countries and importing countries. United States exports to occupied
areas and to countries cooperating under foreign aid programs, also will
continue to be very important.

Production Reduced but Still Third Largest

Production of all wheat ib estimated at 1,189 million bushels,
8 percent less ti a'the 1,288 million bushels produced last year but about
20 percent more than the average of 992 million bushels. This is 13 per- .
cent less than the,record 1947 crop but is larger than for any year prior
to 1947, and the third largest of record. Extensive losses occurred during
June in most of the important wheat States as the result of excessive wet
weather at harvest time in the southern Plains and extreme dryness in the
northern Plains and the Pacific Northwest. The indicated production was
.148 million bushels below June 1 prospects.

Production of winter wheat was indicated at 932 million bushels,
,that of durum 49 million and of other spring 208 million. Seeded acreage
i Seimated as follows: Winter 61.5 million.,, durum 3.7 million, and
-or A p "1 18,0 million. Yield per acre (1938-47 average in parenthesis)
.M fo'.w.: Winter 15.2 (15.2), durum 13.4 (14.1), other spring "
S .8.a d al. l wheat 14.3 (15.1),

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SJULY 1949 b .
July 1 Stocks of Old Wheat 293 Million Bushels,
50 Percent above 196 Million Year Ago

Carry-over stocks of old wheat in all positions on July. 1, 1949,
were e.bout 293 million Lushels. These are about 50 percent larger than
a year earlier and about 3 times as large as the very small carry-over
stocks in 1946 and 1947 (table 1). They are, however, less than half of
the peak carry-overs of 631 million bushels in 1942 and 619 million in
1943. In the 1930-34 period, carry-over stocks ranged from 273 million
to 378 million bushels.

Wheat Disappearance in 1948-49 Fourfh Largest;
Exports Set New High Record

Wheat disappearance in 1948-49, at 1,192 million bushels has been
exceeded only in three years. In 1943-44, 499 million were used for feed,
106 million by industry and only 42 million were exported. In 1945-46,
304 million were used for feed, 21 million by industry and 395 million were
exported. In 1947-48, 186 million were used for feed, 0.7 million for
industry and 485 million exported. Food and seed use in these years did
not very greatly.

The 1948-49 disappearance is estimated in million bushels as follows:
Food, civilian 479, seed' 91, feed 121, military procurement 174 for export
and 5 for food for the services, 226 exports of wheat, 91 million the wheat
equivalent of USDA flour procurement for non-military exports, and 4 to
territories of the United States. The total of these items together with
the carry-over of 293 million bushels account for the total supplies of
1,485 million bushels consisting of the carry-over July 1, 1948 of 196
million bushels, the crop of 1,288 million and imports of 1. Wheat exports
including those to military zones totaled 501 million bushels i, which
is a hew record high for the fourth consecutive year.

Wheat Prices Expected to Gradually Strengthen
And Average about at Tle Loan Level

Wheat prices are expected to advance gradually after the peak of the
market movement in the various producing areas is past, and may average
near the loan level for the marketing year as a whole. The peak of the
movement for hard winter passed and did not overburden facilities.
Because of poorer yields then were expected, many producers of hard
winter wheat have found themselves with ample storage space which will
enable them to hold their wheat. The price of No. 2 Hard Winter at
Kansas City dropped to 61.85 n July 2, 35 cents under the loan rate
recently announced. This compared with a low point about 18 cents under
the lean last year. Prices have since strengthened and on July 25 were
tl.9 up to 14 cents.

StoraGe in the soft winter wheat belt has not been as readily
available and the movement to market has been heavier and prices weaker.
Moreover, the poor keeping quality of the high moisture content has in-
tensified this movement.

'Total actual exports exceed the total of military exports of 174 mil-
lion, 226 million wheat exports and 91 million equivalent of USDA pro--
curement of flour for export by 10 million, because the inventory position
of the latter item was decreased by that quantity. (Continued on gaa.7,
I....1!""




.. .. I': "


The price of spring wheat at Minneapolis is still above the loan.
,.. The price of No. 1 Dark Northern Spring Wheat at Minneapolis on July 25 was
S.:.2.27 or 5 cents above the loan rate of $2.22. The seasonal decline in
5sapring wheat always occurs. later than in the case of winter wheat because
.'of the later harvest.

Considering the wheat crop as a whole, and recognizing that distress
Loans at 75 percent of the loan rate are. available on wheat in temporary
storage or on the ground, it is to be expected that large quantities will
be placed under loan or under purchase agreement. This quantity may be
S about as large as last year even with a crop 100 million bushels smaller.

ew Crop Loan at Farm Level 5 Cents
Below Year Ag

tThe national average of wheat price support on farms was announced at
$1.95 a busheL, 5 cents lower than last year. This average reflects 90 per-
Scent of parity. 2/ Rates at selected terminal markets are as follows: No. 2
Hard Winter at Kansas City, $2.20 and at Chicago $2.25; No. 1 Dark Northern
S Spring at Minjeapolis; $2.22; No. 2 Red at St. Louis, $2.25; and No. 1 Soft
S White at Portland, $2.16. 3/ These rates allow for increases in freight
rates during the past year and increases in handling charges permitted under
: the currently applicable Uniform Warehouse Agreement. Eligible wheat shall
be wheat produced in the continental United States in 1949, grading U. S.
Sio. 3 or better, or grading U. S. No. 4 or 5 solely on the factor of test
weight.

Purchase agreements are again available in addition to farm-storage
and warehouse-storage loans.. Farmers may use either or both the loans and
Purchase agreements. In general the programs follow the pattern of previous
years, but this year they will be.available to farmers from time of harvest
through January 31, 1950. This makes the new program available for an addi-
tional month. Loans will mature April 30, 1950, or earlie-' on demand.

Under the purchase agreements the producer will state the maximum
quantity of eligible wheat upon which he desires an option to deliver to CCC.
Within the 30-day period ending April 30, 1950, or such earlier date as may
be determined, he must declare his intention to sell to CCC. Purchase -prices
by CCC will be the same as the loan delivery rates.

/ Parity is determined by multiplying the base price of 88.4 cents per
bushel (average of 60 months fr6m August 1909 to July 1914) by the index of
Prices paid, interest and taxes (1910-14=100) which in mid-June 1949 was
2 245 percent. The resulting parity is $2.17.
'/ Rates.were announced for No. 1. but these have been adjusted to agree with
the grades shown for the same markets for 1938-48 in the May-June 1949 Wheat
Situation, page 23.
footnote concluded from page 6.- CORRECTION in The Wheat Situation, May-June
i1:949; table 3, page 18, for 1946-47, feed should be 182,045 instead of 183,691;
al domestic 745,884 instead of 747,530; and military procurement 92,394
itead of 90,728. Also, table 4, page 19, for 1947, January-June, feed should
i 176,923 instead of 78,589, total domestic 301,808 instead of 303,564, and
litary procurement 54,510 stead of 52,844. Also table 6, page 21. 1948,
cod abe commercial wheat exports should be 15,471 instead of 30,277;
..eIhat Sports 106,958 instead of 121,764; and total exports 166,142






JULY 1949 .- 8-

National Acreage Allotment Set At
68.9 Million Acres; Not Marketing Quotas

A national acreage allotment of 68.9 million acres for the 1950 crop
was announced on July 14. With total seeded acres for the 1949 crop esti-
mated at 83.2 million acres, this represents a reduction of about 13 million
acres or about 17 percent. The announced allotment would be larger than in
1]3 of the 24 years between 1920 and 1945, and with average yields would
provide sufficient wheat for anticipated domestic and foreign needs and for
carry-over stocks.

No wheat marketing quotas will be proclaimed for the 1950-51 market-
ing year. 4/ With the very large June decline in the 1949 crop prospects, the
total supply as projected for 1950-51 is less than the level at which the
proclamation of wheat marketing quotas is required.

As defined in the Act, the national wheat acreage allotment 5/ is
that acreage which, at average yields adjusted for trend, will produce an
amount of wheat, plus the carry-over,equal to a normal year's domestic con-
sumption and exports, plus 30 percent. A normal year's domestic consumption
and exports, determined to be 1,100 million bushels, plus 30 percent is equal
to 1,430 million bushels.

The carry-over July 1, 1950 was determined at 320 million bushels. 6/
To make available a supply for the 1950-51 marketing year equal to 1,430 mil-
lion bushels (the normal year's domestic consumption and exports plus 30 per-
cent) would require a 1950 wheat crop of about 1,110 million bushels. At 16.1
(average yields adjusted for trend) a crop of this size would require 68.9 mil-
lion acres the announced national acreage allotment.

State acreage allotments for the 1950 crop of wheat, which in total
make up the national allotment, were announced on July 21. The break-down by
States is based primarily upon the seeded wheat acreage in each State during
the past ten years, adjusted for recent production trends and an allowance for
crops for which wartime increases were requested. The State allotments will
in turn be broken down by each State into county allotments, which are then
divided into individual farm allotments. Each farm allotment represents that
farm's share of the total national allotment.

4/ Had marketing quotas been proclaimed this ,ear it would have been the
fourth time in the history of the legislation governing their use. Quotas
were proclaimed in 1941, 1942, and 1943. The required referendum resulted in
a favorable vote in 1941 and 1942. In 1943 the quotas procedure was suspended
because of the war emergency before a referendum was held.
2/ Determination of an allotment for 1950 resumes the procedure initiated wit
Agricultural Adjustment Act of 1938 and maintained until the 1943 crop, when
it was suspended because of the war emergency.
6/ UsJng figures available at the time, the carry-oVer July 1, 1950 of 320
lion bushels was determined as follows: Total supply of 1,490 million
(July 1, 1909 carry-over of about 300 plus crops of 1,189) minus 1,170 milli
bushels (food 490, including civilian, military, and U. S. Territories; feed
150, seed 80, and exports 450).







Acreage allotments are one method by which producers can bring
uj:applies moro nearly in line with demand and provide a limit to Government
Seixpenditures for supporting the pric- of tAeat. YWith an acreage-allotmont
Program in effect for the 1950 ihoat crop, only those groweors who cooperate
trih their allotments will be entitled to price support.

In announcing the allotment, the Secretary of Agriculturo said in'
part: "If wheat growers in general stay within their acreago allotments,
thus adjusting production to expected demand, it may be possible to avoid
marketing quotas in future years. Quotas, vith their penalties for excess
marketing, provide controls vhich will not be needed if acreage allotmcnbs
and other measures succeed in adjusting production,"

U, 8, Import Quotas From Canada Filled

The burront year's flour quota from Canada, amounting to 358 mil-
lion pounds, was filled by Juno 6 for the quota year ending Mlay 28,' 1950.
The whoat quota was- reported 96 percent filled June 22. The quotas, first
established in 19l1, limit tot.l imports from all sources to 800 thousand
bushels of wheat and 4,0 million pounds of flour during any" quota yoar.
The flour quota includes semolina, crushed or cracked vroat, and similar
products as roll as flour. The ivhiat quota includes only -:heat for food;
the classification "unfit for human consumption" does not come under
import quota*

Total imports fol U. S. use for the 11 months ending May 31 amounted
to 660 thousand bushels, consisting of 554 thousand bushels of full duty
wheat, 8 thousand of cat for food, .nd the whoat equivalent of 98 thou-
sand bushels of flour.

Imports of vhoat and flour in the past few years have boon small.
Imports-in 1943-44 and 1944-45 amounted to 136 million and 42 million
bushels, respectively (table 2). Imports in these two ;-Lars vore used
as feed to supplement cur domestic feed grain supplies which h i.ore inado.
quato to moot the largo Tartimo requiromonts. Imports in 193-4 -. ox-=;
ooodod exports by 71 million bushels. Not imports have occurred only in
3 othor-yoars in the history of the country. In those throe years,
1934-36, net imports necobsitated by th6 severe drought amounted to 2,
28 and 22 million bushels, respectively,

THE WORLD WH AT SITUATION

BACKGROUND.. On July.l, 1943, stocks of -hecat in'the four
principal exporting countries v.rec a record of 1,737 million
bushols. By July 1945, horwver, they wore do:in to 818 million
... bushols,. They wore 387 million in 1946 and 385 million in
1947. Greatly increased disappearance was caused by vartino
deopltion of food supplies in importing countries and by
poor crops in many areas. Stocks in those four countries on
July 1, 1947 woro the smallest since 1938 and were about
16 percent less than the 1935-59 average of 658 million bushols.
On July'l, 1948 these stocks had increased to 552 million
bushols.


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U.S. DEPARTMENT OF AGRICULTURE


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U. S. DEPAR.TMENT OF AGRICULTURE NEG ima8 OFFICE OF FOREIGN AGRICULTURAL RELATIONS


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JULY 1?49 -12 -

Eurcopean Crop Conditions below 1948:
Cinndi-n Prospects Continue below Normal 7/

It is still estimated that the bre.dgrain output in Europe, exclu-
s.vc cf the U.S.S.R., will be some 5 percent below the 1948 level and more
th-n 1C percent below the 1935-39 average. In the Soviet Union, some in-
cre.:e in srain production is expected as compared with last year, when
wheat production was 17 percent below prewar.

Dry hot weather from mid-June to mid-July in Western Europe Cenerally-
favored the ripening and harvesting of wheat and rye. Cool and rainy
weather retarded crops in parts of central and eastern Europe, and heavy
rains delayed harve3clng in some southern areas. The cool and rainy weather.
zone extended into the Soviet Union, covering most of European Russia, in-
cluding southern Ukraine.

Western Europe.- In the United Kingdom, wheat is in good condition
but with a reduced acreage, prospects are for a substantially smaller crop.
In Ireland, crop condition continues generally satisfactory. In Belgium,
prospects are up to or better than last ycar. In France, hot, dry weather
durinL Ji'na and early Ji.ly was reported to have reduced the brop.

Northern Europe.- In Denmark, the crop may exceed the previous record
in 1938. In Sweden, prospects in early July were normal or above. In
Norway, the ou-tlook is for somewhat below normal yields. In Finland, pros-
pects arc somewhat abovo average.

Central Europe.- In Bizone Germany, yields of breadgrains are e;:-
pocted to approximate those of last year. In Austria acreage was increased,
and yields are expected to be substantially above 1943. In Czechoslovakia,
a very good grain harvest is underway.

Southern Errope.- In Portugal, wheat production is still expected
to total mo_-e than last year although below the prewar level. In Spain,
the season was much less favorable than a year ago. In Italy, a
good crop is being turned out in spite or earlier reports of' drought.

Southeastern Europe.- In Rumania, spring wheat condition is reported
Improved. Tn Hungary, prospects are for the best wheat crop since the war;
rye yields are e:-pected to be satisfactory. In Bulgaria, grain crops appear
to be in excellent condition. In Yugoslovia, winter wheat yields are
running above those for 1948 and prospects for spring sown wheat also are
ver;. good.

A 1949 total wheat acreage for Canada was officially indicated on
July 21 at 27.5 million acres, an increase of 14 percent from the 24.1 mil-.
lion acres seeded a year ago. The acreage in the three Prairie Provinces
totaled 26.5 million acres compared with 23.0 million in 1948, The con-
dition for .l11 Canada for wheat on June 30 was 72 percent of the long-time
average yiuld compared with 95 percent on the same date last year and
125 percent in 1947. The low condition figure this year is accounted
for largely by adverse moisture conditions.

j/ From the July European Crop Outlook Report published by the Office of
Foreign Agricultural Relations, U.S.D.A.

A ;




:i ..,':. t.I 1 r


The Argentine Ministry of Agriculture on June 1 called on growers to
Silncrease their wheat acreage, now being seeded, to about 17 million acres.
."his would be a substantial increase over the small wheat area of the past
i2' years of about 13.5 million acres, and would bring the acreage back to the
i-19 40-44 level, though still not up to prewar averages. However, in view of
;|Wthe fact that the season was well advanced by the time the appeal for in-
; creased acreage was made, it is doubtful that any appreciable increase will
result, Labor shortages and high labor costs have contributed to the smaller
acreages. Dissatisfaction with prices paid producers is also reported to
Shave affected seedings. Soil conditions are reported to have favored seeding
S'wheat in Argentina this year.

i;In Australia the acreage is expected to show some increase from the
3i." 13.0 million acres seeded last year or the 13.1 million average in 1935-39.
Prospects are generally favorable. The 1948-49 wheat crop is now estimated
S at about 190 million bushels, a slight reduction from earlier estimates, but
still well above the average of 170 million bushels for 1935-39.

INTERNATIONAL WHEAT AGREEMENT RATIFIED; COUNCIL HOLDS FIRST MEETING

The International Wheat Council, created under the International.
Wheat Agreement signed in Washington in March/April, 1949, concluded its
first session in Washington on July 9. The objectives of the Agreement are
"to assure supplies of wheat to importing countries and markets for wheat
to exporting countries at equitable and stable prices."

Following are the highlights of the Council's actions:

1. Found that the required number of nations had ratified the agree-
ment and therefore declared the International Wheat Agreement to be in effect.
So'far, the agreement has been ratified by the exporting nations responsible
for 99.6 percent of the guaranteed exports and by importing nations responsi- :
ble for 84.5 percent of the guaranteed imports. Signatory nations that have
not yet ratified are: Exporters Uruguay; importers Bolivia, Brazil, China,
-- Colombia, Cuba,' Dominican Republic, Ecuador, Egypt, El Salvador, Guatemala,
.. Liberia, Mexico, Nicaragua, Norway, Panama, Philippines Republic, and Venezuela '
SThe' parliaments of most of these nations have not been in session since the .
.:agreement was drawn up. Most of them are still expected to ratify.

rai.. f 2. Agreed that signatory nations may have until October 31, 1949, to
Ratify. After that nations may still be admitted, including those that did
|i not sign, by a two-thirds vote of the exporters and importers voting separately.

3. Voted to make London the permanent seat of the Wheat Council.

4. Elected F. Sheed Andureon and Edwin McCarthy Chairman and Vice
Chair respectively of both the Council and the Executive-Committee for the
crop year 1949-50. Mr. Anderson is Under Secretary of the Ministry of Food
,pof the United. Kingdom, Mr.-McCarthy is the Secretary of the Depirtment of
iCommerde and Agriculture of the Australian Government.
i








5. Elected, as members of the Committee for the crop-year 1949-50,
the following nations: Exporters Australia, Canada, and the United States
importers Benelux (the customs union of Belgium, Netherlands and Luxembour
Egypt, India, Italy, Union of South Africa, and the United Kingdom.

6. Elected the following nations to membership on the Advisory Corn-
mi.ttee on Price Equivalents: Exporters Australia, Canada, United States:
importers Benelux, India, United Kingdom. This committee, consisting of
technical experts, will advise the Executive Committee and the Council on the,:
relationship between different grades and qualities of wheat and flour and on;'.
relative prices of wheat in different parts of the world.

7. Delegated to the Executive Committee the appointment of a temporary
and-or permanent Secretary of the Council. The Secretary's duties will be to
administer the Wheat Agreement under the direction of the Chairman of the
Council and the Executive Committee.

8. Agreed that actual operations uhder the Agreement start on August 1

9. Deferred any action on adjustments of guaranteed quantities until
the next session of the Council at which time additional nations will have had
opportunity to ratify the Agreement.

10. Adopted rules of procedure to govern action by the Council, the
Executive Committee, and the Secretarilt.

11. Agreed that the next meeting.of the Council would be convened in
London in early November.

Table 1.- Wheat: Stocks in the United States on July 1,
Average 1937-41, Annuals 1944-49

Stock position :Average: 1944 :1945 1946 1947 1948 1949
:1937-41: : : : :
S1,00 00 1,000 1,000 1,000 1,000 1,000
:bushels bushels-bushels bushels bushels bushels bushels

Farm ................... 67,055 103,622 87,703 41,606 40,477 94,511 65,598 4
Interior mills, elevators:
and warehouses ........ 37,77 30,332 42,129 .8,376 10,116 30,645 65,119
Terminals (commercial) .. 64,435 82,912 67,185 29,917 8,129 34,065 128,158
Merchant mills and mill
elevators ............ 60,898 67,308 58,463 12,838 24,591 34,240 30,600
Commodity Credit Corp.,
wheat in transit and
in steel and wood bins : --- 32,381 23,700 7,351 500 2,530 3,797
Total .......... 230,185 316,555 279,18Q 100,088 83,813 195,991 293,272

Commercial stocks at terminals are reported by the Production and Marketing Admini-
stration. Commodity Credit wheat in their steel and wooden bins and in transit
reported by the Commodity Credit Corporation. Stocks in the other three positions!
are estimated by the Crop Reporting Board.
Figures in the table include quantities owned by the Government or still outstandi
under Government loan.


.. .',:


U I a ywy


- JLT -






Table 2 --Wheat and flours Imports into the United States for
;, ,: ; d".estic utilization and for grinding in bond and export, 1923-47


vi

1t


at. tUnfit for human:Total imports a
Year :Full duty consumption ifor domestic t Flour a Wheat for
ginning s (tarrif a (tarrif of t utilization sin terms:Grinding in bond
July :42 cents)a 5-10 percent i(total 6f firstsof wheat and export as
S. .ad valoremnl/s 2 columns) __ flour 2/
: Bushebl Bushels Bushels Bushels Bushels
.


51 923 13,783A423 13,783,423 794,920 13,904,837
S1924' 272,548 -- 272,548 31,575 5,813,353
1925 1,664,843 1,664,843 81,804 13,421,480
S926 a 48,808 -- 48,808 28,463 13,171,683
..,1i: 1927' 161,297 -- 161,297 26,926 15,043,679
S.1928 79,136. 79,136 12,234 22,480,962
: 1929 44,607 -- 44,607 8,004 -12,903,364
S1930 40,756 307,336 348,092 5,466 -19,013,090
S..6sl : 6,057 -- 6,057 1,278 12,878,851
,1932. 5,767 1,354 7,121 3,201 9,372,151
193 : 143,646 5,739 149,385 3,878 11,341,052
1934 / a 5,905,380 8,146,044 14,051,424 18,048 11,064,092
1935 :25,288,519. 9,205,128 34,493,647 166,112 11,978,659
S1936 30,205,430 4,057,016 34,262,446 192,606 13,468,667
19397 s 597,776 4,150 601,926 139,773 2,819,031
1938 s 39,086 206,969 246,055 388,662 8,988,542
1939 : 55,524 86,284 141,808 335,411 9,952,595
1940 : 164,846 3,236,678 3,401,524 291,311 7,330,854
1941 1,699,424 1,785,200 3,484,624 179,332 11,911,656
1942 a 806,182 150,166 956,348 100,236 7,576,511
1943 :136,013,365 4 188,305 136,201,670 157,456 10,952,124
1944 t#4623%03 5 J15,918,827 .42,153,862 199,487 9,213,393
194$ 1,136,044 766,857 .1,902,901 96,577 11,591 148
1946 : 21,295- 28,129 49,424 7,462 1,968,330
7t 6,645 -- 117 .564 124,209 6990 18,508
Zap;orts for consumption from United States Tariff Commission, July 1923 to
:eianbcer 1933, and from Bureau of Foreign and Domestic Commorce, January 1934
to1 date.
I/ Beginning June 18, 1930, a new classification, Wheat unfit for himan con-
sumption,, was introduced by the 1930 Tariff Act. Effective Jaiuary 1, 1939,


ae secondc traae agreement witn uanada reduced the tarriir to 5 per cent a
valorem on "wheat unfit for human consumption."
/ flheat for grinding in bond for- export, which enters duty free. Beginning
June 8,, 1930, includes imported wheat ground into flour in bond for export'
to Cuba. .From June 18, 1930 to September 3, 1936 the duty on this wheat
equaled the reduction. in Cuban duty and consumption tax applicable by treaty :
to -flour produce in the United States imported into Cuba. On September 3,
1936 the consumption n tax was repealed. Effective January 17, 1948, under
the General Agreement on Tariffs and Trade and the Exclusive Agreement with ;
SCuba signed at Geneva, the duly on wheat imported for milling in bond (the
flour from which is 'imported into Cuba) is 20 cents per 100 kilograms, gross
Weight.
3/,eneral imports prior to July 1934, subsequently imports for consumption.
Beginning Jly 1934, excludes flour imported free for export in manufactured
foods,
a .-gel maty. 0r~ridit Corporation imports for feed use, From December 23,.:
iN 19O 19s -orts of wheat and its products used for. livestock


* :






Table 3.- Wheat: Average price per bushel received by farmers
and parity price, United States 1931-49 '

Year : : : : : : : : :Mar
be- : : : : : : : : : : :. : ng:
gin- :July : Aug.:Sept.: Oct.: Nov.: Dec.: Jan.: Feb.: Mar.i Apr.: May :June :yepr'
ning : 15 : 15 : .1: .1: 15 : 15 : 15 : 15 : 15 : 15 : 15 :aver-i
July : : : : : : : : : : a ge
:Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents.;
Average Price _
1931 : 36.3 35.4 35.7 36.1 50.5 44.1 44.1 44.0 44.2 43.1 42.4 37.3 38.2
1932 :.35.6 38.5 37.4 34.6 32.8 31.6 32.9 32.3 34.5 44.8 59.0 58.7 37.5
1933 : 86.9 74.7 71.1 63.6 71.1 67.3 69.4 72.0 70.9 68.7 69.5 78.9 73.6...
1934 : 78.8 89.6 92.2 88.5 88.1 90.6 89.3 87.9 85.5 90.2 87.8 77.3 83.9
1935 : 76.4 80.8 85.1 94.8 87.5 88.9 92.0 91.1 89.3 85.4 81.6 79.9 82.7
1936 : 94.1 104.8 104.3 106.8 106.4 114.5 123.6 124.9 123.2 126.6 118.3 108.9 102.0.
1937 :112.8 99.4 .93.0 88.7 81.9 83.6 88.6 86.6 80.3 75.0 71.4 69.7 95.9
1938 : 60.8 50.7. 52.5 52.2 52.0 53.6 57.1 56.9 56.7 57.8 63.0 62.53/55.6
1939 : 55.7 54.5. 72.7 70.3 73.1 82.4 84.5 84.1 85.0 88.9 80.7 67.4 68.6
1940 : 61.4 60.1 62.6 68.2 72.5 71.5 73.0 67.8 71.8 76.0 79.4 83.1 67.4
1941 : 85.6 88.5. 95.8 91.0 93.4 102.2 106.1 104.9 105.1 99.7 99.8 95.7- 93.9.
1942 : 94.6 95.4 102.8 103.5 104.4 110.3 117.5 119.5 122.7 122.3 122.8 125.0 109.0
1943 :126.0 127.0 130.0 135.0 137.0 143.0 146.0 146.0 146.0 147.0 147.0 143.0 135.0
1944 :139.0 135.0 135.0 142.0 143.0 145.0 146.0 147.0 148.0 149.0 149.0 150.0 141.0
1945 :146.0 145:0 145.0 151.0 153.0 154.0 154.0 155.0 158.0 158.0 .170.0 174.0 149.0
1946 :187.0 178.0 179.0 188.0 189.0 193.0 191.0 199.0 244.0 240.0 239.0 218.0 190.0
1947 :214.0 210.0 243.0 266.0 274.0 279.0 281.0 212.0 221.0 229.0.222.0 211.0 229.0:
1948 :203.0 196.0 197.0 198.0 204.0 205.0 202.0.194.0 198.0 200.0 200.0 186.0 199.0


Parity Price 4/
1931 :124.6.122,9 121.1 120.2 118.5.118.5 114.0 114.0 112.3 111.4 109.6 108.7
1932 :108.7- 108.7 107.8 107.0 106.1 105.2 100.8 100.8 99.9 100.8 100.8 101.7
1933 :105.2 108.7 112.3 112.3 112.3 112.3 109.6 111.4 112.3 112.3 113.2 113.2
1934 :113.2 115.8 116.7 "116.7 116.7 116.7 114.9 115.8 115.8 115.8 115.8 115.8
1935 :114.9 114.0 113.2 113.2 112.3 112.3 11111.411.4 110.5 110.5 110.5 109.6
1936 :112.3 114.9 114.9'114.9 114.9 115.8 116.7 118.5 118.5 120.2 120.2 120.2
1937 :119.3 118.5 116.7 115.8 114.9 114.0 114.0 114.0 113.2 113:2 113.2 112.3
1938 :111.4 110.5 109.6 109.6 109.6 109.6 108.7 108.7 108.7 108.7 108.7 108.7
1939 :108.7 107.8 110.5 110.5 110.5 110.5 110.5 110.5 111.4 111.4 111.4 111.4
1940 :110.5 110.5 110.5 110.5 110.5 111.4 110.5 110.5 111.4 111.4 112.3 114.9
1941 :115.8 118.5 121.1 122.9 124.6 125.5 127.3 129.1 130.8 131.1 132.6 132.6
1942 :133.5 133.5 134.4 135.3 .136.1 137.0 137.9 139.7 140.6 141.4 143.2 144.1
1943 :145.0 145.0 145.0 146.0 147.0 148.0 19.0 4 149.0 149.o 19.0 149.0 150.0
1944 :150.0 1500 150.0 150.0 151.0 151.0 152.0 152.0 153.0 153.0 153.0 153.0
1945 :153.0 153.0 154.0 155.0 155.0 156.0 156.0. 158.0 159.0 160.0 164.0 166.0
1946 :176.0 180.0. 177.0 183.0 187,0 188,0 190.0 195.0 201.0 203.0 202.0 203.0
S1947 :203.0 207.0 210.0 211.0 213.0 217.0 222.0 220.0 219.0 220.0 221.0 222.0
1948 :222.0 222.0 221.0 228.0 219.0 219.0 219.0 217.0 217.0 217..0 217.0 217.0,

1/ Data for earlier years in The Wheat Situation as follows: 1909-47 Jan.,Feb. 191
page 11, prices received. 1922-30, ALgust 1945, pages 20-21, parity prices,
2/ Monthly prices by States weighted by production to obtain a price for the
'Jnited States; average for year .obtained by weighting State price averages for
the marketing year.
S 3Beginning 1938 includes unredeemed loans at average loan value.
Computation of paritrprice: Average price in base period (August 1909 to
July 1914) monthly index of prices paid by farmers, interest and ta s. A
l for June 1949-88.4 x 2.45=2.17. .. .
,:.,. : ":..: .k:.
..- _t" :::: 4:. ... .. :::. [""..







S Table 4.- Wheat: Prices per bushel in three exporting countries,
Friday nearest mid-month, Jan.- July
Weekly June July 1949

: GUARDD W-tEAT : HARD WHEAT : SOFT WHEAT
: United States : Canada :United States:United
: Fo. 1 : No. 2 : No. 1 :States
Date : Park : Menitoba : Dark : No. 1 :
(Fliday) :Northern Spring : at : Winter :Portland:Auetralia


S13 percent
: protein at
: Duluth I/
: D' Pollars
Friday mid-monthit
r'; January 14 : 2.30
February 11 2.24
March 11 2.33
April 14 : 2.37
S May 13 : 2.35
June 17 2.32
July 15' : 2.41


Weekly
June
June
June
July
July
July


2.25
2.35
2 3 '
2.4?,
2.43
2.32


.Fort William
: 2/


: Galveston
: If


: I/ : 1/
: :


Dollars Dollars Dollars Dollars


2.32
2.18
2.16
2.18
2.13
1.97
2.00


2.03
2.06
1.96
1.93
1.98
2.00


2.44
2.35
2.42
2.43
2.42
2.03
2.20


1.98
2.10
2.08
2.10
2.21
2.27


2.225
2.16
2.235
2.22
2.25
2.25
2.10


2.15
2.25
2.10
2.07
2.13
2.10


3/ 2.50
---
---
---
---
---
---


---
---
---
---
---
---


I/ F.O.B. spot to arriveT 2/ Fort William quotation is in store. 3 $2.50 for
Britain, other countries, $2.66.

Table 5.- Wheat: Weighted average cash price, specified markets
and dates 1948-49

:All classes: No. 2 :No. 1 No. 2 No. 2 : No. 1
Month :and grades :Dark Hard Dark : Hard : Red : Soft
and :six : and Hard :N. Spring :Amber Durum: Winter : wheat
date : markets : W.nter :Minneapolis:Minneapolis; St. Louis:Portland
i:.._ : :Kansas City: : : 1/
1948: 194961948 :1449 :1948 '1949 :198: 1949 1948:1949:194: 1949
Dol. Dol. Dol. Dol. Dol, Dol. Dol. Dol. Dol. Dol. Dol. Dol
'I Month


May
June


:2.60
:2.56


2.25 2.40
2.16 2.29


2.22 2.62
1.95 2.60


2.33 2.98 2.25 2.44
2.37 2.84 2.32 2.32


2.34
1.83


2.36 2.22
2.30 2.18


SWeek ended :
June :
June 11
June 18
S; June 25
uly 29

.i16 :


2
2
2
2


2


.61 2.12 2.39 1.99 2.62 2.27
.58 2.27 2.31 2.14 2.60 2.36
.57 2.27 2.26 2.03 2.60 2.36
.55 2.19 2.30 1.98 2.60 2.38
.44 2.04 2.24 1.91 2.53 2.41
.34 2.07 2.22 1.99 2.46 '2.46
.33. 2.14 2.21 2.05 2.44 2.45
.30 2.08 2.19 2.02 2.41 2.37
ktlEy; cash quotationa.


2.98 2.29 2.39 2.14 2.30 2,15
2.92 2.32 2.36 2.06 2.30 2.23
2.90 2.32 2.37 2.19 2.30 2.25
2.73 2.32 2.31 1.95 2.30 2.15
2.62 2.29 2.28 1.81 2.27 2.05.
2.55 2.35 2.27 1.87 2.21 24i.t:
2.50 2.38 2.23 1.92 2.18 2. 1
2.44 2.J6 2.22 1.90 2.17 2.10


iL _~__





payment o0 pu 4. ng So.


LWNrER.ST .j.F FLORIDA
OFFICIAL BUSINESS
3 1262 08862 6717
BAE-WS-112- 8/49-2700 LIBRAR P y
PERMIT NO. 1001 DOC-urA7I ::





S- - -18 -

Table 6.- Wheat: Average closing prices of Sept. Wheat futures,
specified markets and dates, 1943-49 .

: Chicago : Kansas City : Minneapolis
Period : 1948. 1949 : 1948 : 1949 : .1948 1949

Dollars Dollars Dollars Dollas Dollars Dollars

Month
Iay : 2.34 1.35 2.25 1.86 2.36 1.92
June : 2.31 1.95 2.22 1.88 2.35 1.93
Week ended:
June 4 : 2.32 1.89 2.23 1.81 2.31 1.86
June 11 : 2.29 1.93 2.21 1.85 2.27 1.90
June 18 : 2.30 1.96 2.22 1.88 2.28 1.93
June 25 : 2.32 2.00 2.24 1.93 2.30 1.98
July 2 : 2.31 1.98 2.23 1.92 2.29 1.97
July 9 : 2.31 2.03 2.24 1.99 2.29 2.08
July 16 : 2.30 2.02 2.21 1.99 2.27 2.07
July 23 : 2.29 2.03 2.21 2.00 2.27 2.09










..*


Washington 25, D. C.




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