Poultry and egg situation

UNITED STATES DEPARTMENT OF AGRICULTURE
BUREAU OF AGRICULTURAL ECONOMICS
WASHINGTON


THE P 0 ULTR Y A N D EG G S I T U A TI O N


PES-39


MARCH 2. 1940


FEED-EGG RATIO AT CHICAGO. 1925-40


DOZENS

4

3

2

1
WEEKLY
to0 YEAR AVr
19 i. *- 4
.1

2

3


I 4 nDEatuIHeh Cr llbslCUu-Lat


0,n 'gv ugbO Ge.Cuaua .......


CHICKS AND YOUNG CHICKENS PER FARM FLOCK
ON JUNE 1. 1927-40


NUMBER
PER FLOCK


U 5 DEFaRTMENT OF AGRICUL0UPE


NEC jlli" BUR.aU Or AGRICuLIURAL ECOhOM=-CF


THE CHANGE FROM THE PRECEDING YEAR IN THE NUMBER OF
CHICKS AND YOUNG CHICKENS PER FARM FLOCK ON JUNE I IS A
G00OD INDICATION OF THE CHANCE IN THE SIZE OF THE TOTAL
HATCH. THE DOTTED LINES INDICATE THAT, ON THE BASIS OF
PAST EXPERIENCE, THE 1940 HATCH MAY BE FROM 2 TO 7 PERCENT
SMALLER THAN IN 1939. AN IMPORTANT REASON FOR THIS INDI-
CATED DECREASE IS THE 12-PERCENT INCREASE (SHOWN IN THE
UPPER CHART) IN THE OCTOBER-MARCH FEED-EGG RATIO FROM
THAT OF A YEAR EARLIER.








THE POULTRY AND EGG SITUATION AT A GLANCE
POUNDS I I PERCENT I I I
(MILLIONS) U.S. STOCKS OF _NONAGRICULTURAL INCOME*
160 FROZEN POULTRY (1924-29=100)
1940 105 ----
140
19 959,,, 100
120 1001940

100 r-Average-- 95
11929-38 1939

80 9

60 Average
0 _7 1929-38

40 85
NUMBER I I CENTS i I


40



30



20



10
NUMBER


85


80


75


70


65


PER
POUND





15




13




11
CENTS
PER
DOZEN

30



25



20


60 15
JAN. APR. JULY OCT. JAN. APR. JULY OCT.
INDEXX NUMBERS, ADJUSTED FOR SEASONAL VARIATION A ON 1ST. DAY OF MONTH

U. S. DEPARTMENT OF AGRICULTURE NEG. 38068 BUREAU OF AGRICULTURAL ECONOMICS


FIGURE I







PE3-39 3-


THE P O ULTR Y A i D EG3 S ITUATI O N


Summary

Commercial hatchings during January were cor.n iderably smaller than

a year earlier, and present indications roir.t to a total hatch during the

19~iO hatching season somewhat smaller than in 1939.

This is the first year on record during which ejgc production per hen

and per flock decreased between January 1 and Februar.y 1. Both productio'h

figures normall:, increase about 40o percent between thlse two dates, but this

year because of the severe, weather the rate o:.f la.y dpcrnased 9 percent and

production per flock declined nearly 14 percent. (The decrease in production

per flock was greater tflr, the decrease in production p.:r hen because the

Pverage numbr-r of layers per flock declined more thn personally during

January).

The feed-ege rntio *vs re lat.ively high ani unifvorable for producers

during Decemter and eirl;- Jranu-r.v, but the reduced m-irl-:tings cf egtrs result-

ing from the decline in production caused wholesale prices to advance, and

the number of -egs required t.:. bu:.- r.11uds of .oultr:, feed decreased con-

traseasonally d'luring lat, J:.nuary -nL early Februery. However, the increasing

volume of eggs no' tcin [L mirketed is causing e;f -.rices to recede and the

feed-sgg ratio is gain becomine- .u-favorale to ;'oiucer:. The nrice of feed

iS not expected to vary Eich during the ring m.:nrths, and the number of eggs

required to purchase i00 Cjourds of laying ration durin- thu n.xt fewv months

probably will remain above rv rag- and conil-'erably above the level for the

corresponding .eriacd cf 1i39..

Storage stocks of eggs ha-..ve reached their usual seasonal low. The

major into-storage mov'emont will probably begin a.:-rly ir. March,






PES-39


- 4 -


rPeceipts of dressed poultry at the principal markets have decreased

from the abnormal January high, but are continuing above a year earlier and

somewhat above average. Storage stocks of frozen poultry are dpcreaoing

about seasonally now, but are continuing above a year earlier and considerably

above the 1929-38 average.

The price received by farmers for eggs increased from 18.3 cents

in mid-January to 20.2 cents in mid-February. This is the first time since

1936 that an advance has occurred between these dates. The farm price for

eggs during the next few months will probably decline about seasonallyy, but

possibly more sharply than a year earlier. The farm price for chickens

advanced seasonally from 12.0 cents on January 15 to 12.2 cents on

February 15, but remained below both the price of a year earlier and the

1929-39 average.

Consumer purchasing power, which has been increasing in recent months,

probably will steady or decline somewhat during the next few months.

:EZ~-EGG RATIO

The cost of poultry feed based on Chicago prices is not expected to
change much in the next few months from the relatively high level maintained
since about December 1. However, during the last half of January; and. in
early Febr. ";r market supplies of eggs were considerably reduced and -,,hole-
sale egg prices advanced. This resulted in a more favorable feed-egg
ratio, i.e., the number of eggs required to buy 100 pounds of poultry
ration was reduced. For the week ended February 10 it required 5.IF dozen
eggs to buy 100 pounds of poultry ration at Chicago co-rCred with the near-
record high of 6.72 dozens for the week ended January 6. But the lower
wholesale prices resulting from the. rapidly increasing volume of eggs now
being marketed is causing the feed-egg ratio to again become unfavorable,
and it is quite probable that the number of eggs required to buy 10C pounds
of -oultry ration will continue larger than average during the first half
rf 1940.






FE S- .--


F,-ed-e-- r-at!.-, it Chicago


Year



1q20-v


l. ~Lt C


.Do-c ns o.f eg. -s re-quir.,id to bu; 10 ,r' p-'un s 1f -.oultr,' rqti.on I
i"z ef -.WeK;: 17_rn ding r .L zf I_____
: January, :r F r, .r. ': March : !..ia;, : A.i.: hi o'-.
P:', : 27 : =, : I' : 17 :2 : I : 25 : 24 : .3
: E'' :, 1 D :. .:" Dt,,: ":.' r0 0:, -, ':. 7. r' ", i l : .

,.4. 1 r 5.r r .7-' '-..7. ',.: : .* ... .. .ii 7-.:K :
,.1 ,.K,5, ,. ,2 -,..'-,7 .. .",_- ,.1m C c',.0 7.=1 r2-,?, 4.7"

: -6,, L.W ; .' ,r '- I'1 .'3 ,.w"-,-


HIAT'H IN0GS

The m.-r.t hly Sur -.; of Ecmmercial hc tcheries br, the ?.tricultur.i HMar-
ce t in Ser-. ice indicate. t i -t during J .T 'n r i'1 ,, as compared w, it r January,,
last ;rear, the:r': ..is :i d cr-r.-: of -, r percent in thr_ rnub-r o .-I 's set, a
ji-percen t rei.. ct ion in the n.umbe:r .f :hi,?- hat ch, and a. ,1-percerLt de-
crease in ai-.'rce .:r:i. r-. Thi'esc pr rc'rnt.- are ie si tnii icant thran the."
mas.; first o:-.pe.r t be : t u: J -:in r." l' t', a 7o1 th .f i.mu_'h larger thnan
average hat her;, op-r ti:.,,3 l.:,re "'er, r l r e i_..rt .-f th- J -nu ar,- hatch
is se:i for broiler r',-..i..cti: n. C..:.rn :scu.r.ti th- -e r',--. arat i'e fi:s-u.res
are not to be t.:-n as ?j' _tirate- ,f t hrat v.art -,f th,- t-otc s1 easeonal hatch
to be u= ,i in prr...ieii' h.-r.s f,:.r i.-r :l. t ion.

Howe- vz r, the- hancb ;e-. ir. the n t.im-,ter (If choices and :,-.ui. chickens on
farms Ju-dn. 1, is fair; ,... ind.iati:n of0
the e rei '.-e chi.e int th- na.riber : f chicks ha.tce-': b th fr:m farm and
c.,r-,ercia 1 hatc.'nirn dirinc t i hatchin .:eas.:n irn-cli.,te 1;," .r-cedin'.
The .:h rt ,n th-. c.o- r p -c this r ,e-.rt soh -'s !'i.,' th.-s J J.., 1 nui.,b'ers
ha,.'ve 'ari-d di.rirn te -- p st 1, ;,- ars iLd i:'" the Li rmberL .p:Iar.-r.t ;c f.- llw11
a rather -eIll defrinr i -:--, r c ':le. Thl-, t t-. liir~ ici:.i.:-t- the range
within whici' the l'. hi t:h r1 '"n-- f-11l if res t r..- lati.or hirs ,c-,ntin. .

This r .e i ba:, n fiure ._, r ch i sho s the r t-l. tionr.hiir. between
the chan -. fr..m, tv- pr.. h'. ti .;, ar in t he f.-: d--:.. r:-.ti rrn th ch'ba .-_ e in
the nu bier -.f chi-: s ni f rr- *-n J1.i.- 1. 'The ,.:'-rnt _,-:- c'hi',_=ie irn t !ie
-'ctob. 'r-r~ 1 r.:h C'hi.' .,: f '- e-. r -ti., ha b-.,n c, mi: ir: id ith, t i -:,: r f.nta c
ch.a se in the nuribr-r :f -lic 's orn farr.is t.he fl l in- J.in-. 1 f.r the :.ears
' -.-. Thi.., '.'ith Ia -p-: rc-nt i r,-r a.-e .ve ar i st -.:?aon in th,: fed-eg
ratio, as is li1"e-- thi. s a -ac.n f..r the r.nth cti.ber t hr.:- l-h ar-', a
2 tr. 7 p'er.:rt decre-se inr the natc-h is indic-te--d. The effect of mn-. o-fther
circ-li-rt anc s "lich influence. the iatrh I re--nt this re- lati.i-Cnshirp from :con-
t inning .r .if orr ,' fl'r1II .,':ar to 'e r.









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POULTRY SITUAT ICil

Poultry marketingls

Receipts of dressed poultry at the 4 principal markets have de-
creased from the abnormal high for January reached d.'ring the week ended
January 27. The comparatively laire recipe is dir-,4 the first few weeks of
this year are a reflection of the lar.-er than usual marketing of turkeys
and considerably closer culling of farm floc-ks. Receipts at the 26 markets
for the wee': ended February 24 were 4A percent above a year earlier and 26
percent above the 1929-38 average. They are expected to continue somewhat
heavier than a year earlier during the immediate months because of the in-
creased number of hens and chic..ens on farms and the likelihood of an in-
creasingly ur'avcrable feed-eg- ratio.

Receipts of dressed. poultry at 4 markets
(lew Y.ork, Chicagc, Phiilad-lphia, Boston)

Wee: enin : as of ].9,0
Year January : Febru ar- : arch : April
: 20 : 27 : 3 :10 : 17 : 2,. : 2 : 9 : 27
: 1,000 1,000 1,00: 1,0,00 1,0 1,000 1,000 1,000 1,000
: pounds pounds pouno.s pounds ro tnidspounds o s pounds po-in ds
Average
1929-38: 5,553 6,023 5,7.74 4,370 4,541 -,077 ,,051 3,7C6 3,793

1938 : 4,228 3,,14 4,050 3,106 ,191 3,273 68 2,243 3,117
1939 :,330 6,020 4,657 4,1.0 3,6.5 3,555 2,066 3,528 3,640
1940 7,675 :,62' 6,103 5,63.4 5,168 5,150



Poultry storage

Althoug-h decreasing a,-bout seasr.nall--, the ai.,orint of frozen poultry
in storage is conrtinuin- above a year earlier ariJ well above the 10-year
average. Storage holdings of poulti- at thv 26 markets on February 24 were
30 percent above a year earlier and 40 rcrccr:nT above the 1929-31. average.
The out-of-storage movement has increase.iJ during r-cent weeks, but the
quantity moved out so far this year is less thai, usual, reflecting the
larger marketing than a ,.-ear earlier of turk'e:-s an. fowl (mature hens).

Total U-ited States stocks of frozen poultry on Feb:uary 1 were 12.5
percent above a year earlier and about 3 percent above the 10-year average
for that aat-. The larger storage figure for February 1 of this year is
attributed to the respective increases over a year earlier of 131 percent
and 18 percent in stocks of tuir::..,ys an:'. fowl. The quantity of all other
poultry in storage was about 9 percent less tnan on the saiu.e date in 1939.


PES-39


- 7 -






PES-39 S -

Sto:a-- stocks of frozen poultry at 26 markets


~__: _ee-: ending as of 190O
Stor:.-e : .-of-to r.e ov.-.a, Februa:,_- : Storage
Yea t:: c.:s- :. : : stocks
: Janus- 27: 3 : : :rbruary 24
1,0'Cj 1, -CO 1,000 1,000 1,000 1,000
pounds pounds pounds pounds pounds pounds
Average
1929-38 : 93,606 1,471 2,074 2,669 3,005' 34,387

1939 100,216 997 2,714 2,630 2,928 90,897
1940 : 131,593 578 2,954 4,455 5,742 117,864


Chicken price s

The heavier than average 1.a":et.in-s of poultry and the above-ncnnal
storage: stocks of frozen poultry are among the factors causing low prices
to be received by farmers for chickens.

About normal seasonal price increases have been made, but the Feb-
ruary 15 -rize of 12.2 cents was 2.0 cents below a year earlier and 2.8
cents below 'he 10-year average for that date. The reduced hatchings so
far this year, together with the light culling which may follow the cc.m-
paratively closer culling of the past two n r.t may reduce marketing
durir.:' the late spring months enough to cause a greater than seas-nal ad-
vance in prices received by farmers for poultry. Such am advance, how-
ever, may be restricted somewhat by the slightly lower level of conrsum.er
income which may result froa the present decline in industrial activity.

Price per pound received by farmers for chickens


Jan. :. r. .-::. 'u : S-rt. I:v. Dec.
Year :1 : 15 5. : 15 15 15 15 15 15

Cents Cents Cents Cents L:_. s Cents Cents Cents Cents
Average :
1929-38 : 14.8 15.0 15.3 15.9 15.7 15.1 15.2 14.1 13.6

1938 : $c.7 15.C 15.9 1:.2 1S.1 15.0 .LL3 1 .6 13.6
1939 : 1.0 1i .2 i.3 14.4 13.9 13.7 13.6 12.4 11.7
1940 : 12.0 12.2






PES-39 9 -

E'X SIT'.ATICNl

Laying flock: sie

The average size of far-i layi.-i :o.-s dec-ea=ed fro., 5.1 bids
on January 1 to 32.? on February 1. This repr-s:nts a drop of nearly 3
percent the larg; drop het.veen thse- t. date: for the 16 years on
recorJ. Th:- r,.'rral seasonal d-cih.e for this oer'o. is about 1 percenL.
The ntar:e-.: drop this ;ea'.' r:Eultted in an, averac. size of farm flocks on
February 1 l5ss than 1 percent larger t-Lan a year earlier ccmpoared with
an increase rf about 3 percent cn lanu.ar" 1 ov.:.r Jarnarr 1, 1939.

T-.; .prn-..b li[h, c-ulling vhich :.'ay folc": t:-,. comparat.ively
closer culling, of Jaj-uar. and FE.b'ruary, tog thr :it a sc"ie-liwhIt gFeater
than usual -.urmLber of r.ull-ets rcrsinini to be .adc:-d to laying flocks, may
result in a Elijhti less than usual seasc-Lal ic ?lf.n in the nr-mb.r of
layers per flock' d,.uing the spr-ing m-nth..

Av.rare neTiber of la-rin.h hns ,-.cr fa lock
c:. th.- first di of t-c mornt


Year Jan. Feb. Lar. :ril Ma Au. ". c.
T: Iwmb r .i be:r lumb: ir .be.: ;urbc.r [I.b [ir Ui_.:ber Hujr.ber
Av-ra-e :
192;-38 8.5 .3.6 1. 0 "._, 73.0 oj.. 73.3 79.4

138 : 07.6 73.3 75., 73.3 -S3. 59. 72.5 78.0
193 .2.. -2.0 ?., m .s 72.: o1. 3 75.1 80.8
19'40 : 2 5.1 32.


EK production

Tr..is is th.. first ye'-'r. *.r. r. r. :,, in- ,i ch e- nrcnduction rer
hen and pr r flock decr.:-ased betwea-n ,taiar;. 1 and F:'.ruar;, 1. The rate.
cf prod'-ic ion, bcLh r,,.-r hen an:i. r floc-, cn .JanTuar, 1 was the highest
on racord.t for t- at .d-t but the g-r.nerally co:.l rather re-ul'ted in a -
percent ':-ccrea.-e in. rate c' .;- a 1U-pe-rc''.t ieclin. i. nrc.Iucton
per floch bctw tr. January 1 and. ebrir- 1. ot, of th- prod'ict ion
figures .cn.al.y ircre-.-c about 40 prc,-nt beti.Lc-, thcs two date.

The perca-inL.ge drop in p.rc,duction per flock this y-ar .'.as gc-reater
than the p rcernt!go c d-clinr in rat- -f lay per bird 'recaus.- their; was a
greater than seasonal d.:cr-c.as:- in nui.rnb-r of lay rs pr-r far.. flock:. How-
ever, eor production per flock on Fbrar?.,, 1 wa- only 12 percent b-elow
the 1229-38 average for that i-at.., although it was about 2.-. percent below
the comparatively high l:vLl Icr th.: corresponding date in 1939. The
probable less than seasonal d-clin:- in th-e numbe..r of layerE per flock








during the next fewv months, aided by a full recovery of laying stock from
the severe setback caused by the recent generally cold weather, may cause
a greater than seasonal increase in total egg production during the early
sprinr -' months.


Eggs laid per


100 hens and pullets of laying age in farm flocks
or thL first D.a of t-. month.


Year Jan. F.:1. .' ar. A"r. AuTv. Nov. Dec.
: -.-.b- r Itumber lumber Number Number Imb'- r Number Number
Average :
1929-38 : 18.7 26.0 38.4 53.5 56.0 37.6 18.5 15.8

1938 : 22.7 32.2 42.2 57.9 58.1 L1.2 22.3 19.9
1939 : 24.6 31.9 41.4 56.3 57.6 40.4 22.0 21.5
1940 : 26.3 23.9


Egg- maretiwngs

lUr'-:tings of eggs decreased during the first 5 weeks of this year,
a period during which a seasonal increase usually occurs. Recei-t s at
the 4 principal markets during the fifth week (week ended February 3)
were 25 percent below a year earlier and 27 percent below the 1929-38 av-
erage receipts for that week. However, receipts at these markets during
more recent -weeks have increased sufficiently so that the fig:Ire for the
week ended February 24 'lw.s about 12 percent above the 10-year average for
that date aand 6 p.rc.nt above the c,:ar-.ble figure for the same week in
1939. Receipts at these markets will qp-ite probably increase somewhat
greater than seasonally within the immediate future and in general may be
heavier during the next few months than a year earlier, provided tnht the
rate of lay per bird of the past 2 years is rc ainr:d.

Receipts of ejgs at 4 markets
(New York, C'.icagc, Philadelphia, Boston)


':__________..':.. :r.i..'.".c of C4'- _____
Year January : F_______ r_ : _.-rch :April
: 26 : 27 :3 : 0 : 24 : 2 :9 27
1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,000 1,00
cases c-ses cases cases cases cases cases cases cases
Averre :
1929-38 : 206.7 211.1 218.4 219.0 209.8 233.8 287.3 317.5 500.5

1938 : 231.8 220.1 231.6 215.9 200.2 239.2 281.8 297.4 422.9
1939 : 235.5 229.2 212.6 212.9 232.8 247.8 264.4 285.7 501.6
1940 : 177.7 174.6 159.5 170.0 193.9 262.2


PES-39


- 10 -







--.11 -


Egg storage

The out-of-storage movement for United States stocks of shell eggs
during January of this year was greater than for the same period a year
earlier. The storage movement, at the 2b major storing cities indicates that
this situation continued during most of February. The larger out-of-storage
movement so far this year, comr-red with a year earlier, was a situation caused
by comparatively small su-plies of fresh eggs. The situation is changing con-
siderably now, with the increase in volume of fresh eggs being marketed.


The out-of-storage movement
.ately heavier, compared with shell
stocks mf frozen eggs remaining in
same as a year earlier.


for frozen eggs has continued proportion-
eggs, than a year e-rlicr but the storage
the 26 major storing cities are about the


Storage stocks of both snell eggs and frozen eggs are normally very
small at this time of year. Stocks of the former at the 26 markets for the
week ended February 24 were 80 percent below those for the same week a year
earlier and 21 percent below the 1929-3S avrecge for that week.

Storage stocks of eggs at 26 markets

: eek ending as of 19L0
: Storage : : Stnrage
Year : stocks : Storage movement, February : stocks
: Jan. 27 : 3 0 : 17 : 24 : Feb. 24
1,000 1,000 1,000 1,000 1,000 1,000
cases cases cases cases cases cases
Shell
Average
1929-38 226 -66 -50 -43 -22 105

1939 : 120 -23 -8 +3 +8 100
1940 : 76 -45 -14 -4 +7 20

Frozen
1939 72 -45 -3L -24 -11 755
1940 1,02e -70 -71 -74 -65 742


Storage margin

Eggs are stored mainly during the period front March through June and
move out of storage chiefly during the period from September through January.
The difference in weighted average prices between these two periods is a
rough measure of the average gross profit (or loss) on the season's storage
operations. From the margin a deduction of frcm 3 to 4 cents per dozen must
be made to allow for the necessary storage costs. From the viewpoint of the
operator the results of the preceding storage season (and therefore on the
level of egg prices in late winter and early spring) and also tend to affect
the quantity of eggs stored.


PES-39






PES-39


- 12 -


The March-June average price is the average of the monthly prices of
storage packed firsts at New York weighted by the net into-storage movement
as indicated by the first-of-the-monith United States cold storage reports.
The September-January price is similarly obtained, using the price of refrig-
erator firsts at New York weighted by the net out-of-st6rage movement.

The average margin, as measured in this way, for the eggs placed in
storage during 1939 was -.02 cents ($.0002) per dozen. This compares with
- *3.57 cents a year earlier, and -2.08 cents as the average gross loss on eggs
stored during 1937. It is to be noted, therefore, that the average margin on
eggs moved out of storage during the past out-of-storage season was not suf-
ficient to cover the storage costs of 3 to 4 cents per dozen. The unusually
low egg prices during the first four of the five chief out-of-storage months
account for the very narrow margin for 1939. January 1940 was the only month
of the past out-of-storage season during which the average price was higher
than for a year earlier. However, this had little effect on changing the
storage situation because the major but-of-storage movement took place prior
to January 1.

Estimated storage margin on shell eggs per dozen, average 1916-35,
1925-34, annual 1935-38

: Seasonal weighted : Seasonal weighted :
: average st. pkd. : average refrig. : Storage
Year : firsts at N. Y. : first at N. Y. : margin
: Mar. Jun3 : Sent. Jan.
Cents Cents Cents

Average
1916-35 28.22 33.16 4.94
1925-34 : 24.08 27.69 3.61

1935 25.06 23.66 -1.40
1936 21.24 26.82 5.58
1937 22.62 20.54 -2.08
1938 20.37 23.95 3-58
1939 17.61 1/ 17.63 1/ .02

I/ Preliminary.

Egg Irices

The sharply reduced supplies of eggs during most of the.past two months
accompanied by little change in the level of consumers' income caused the
price per dozen received by farmers for eggs to advance somewhat from January
15 to February 15. An increase between these two dates has not occurred since
1936. However, the price of 20.2 cents on February 15 of this year was
slightly lower than the 10-year average, although 3.5 cents above the same date
for 1939. As a result of the relatively high February 15 average price






PES-39 13 -

compared with the January 15 average price (13.3 cents) the season decline
in the prices received by farmers for eggs ma. be more rapid during the next
few mouths than a year earlier. The increasing volume of eggs being marketed
and the decreasiuC 1val of consumers' income may be contributing factors in
causing such a decline.

Price per doz"er received bo- farmers for ews

Year :Jan.15:F b.11F.;r. 15.Apr.1R..Mry 15.July, 155S pt.]5,To-. 1:Dec. 15
:Cnts zC.t'3 C..ts Conta Cents Cents Ce t Ceits Cents
Average
1929-38 : 24.2 20.3 17.3 16.S 16.g 18.1 23.2 30.1 28.8

1933 21.c 16.I'. '.- 1. 1I. 17.6 19.9 2h.9 29.0 27.9
1939 : 1S.S 16.7 1. l.-. 15.2 1S.5 20.6 25.S 20.5
1940 18.3 20.2


DoT STiC D2 .ID

The ,recline in industrial production which was first noticed in the
drop from DEcerdber to.January continued through February, and a still further
decline is in prospect before the downwr.rd trend is reversed. However, condi-
tions in f2naral do not indicate that t-is is the b:ginniing f a severe and
prolonged ,-pression. Chan!.ez in co,,st-crs' income usurlly lr- behind and
arc gone:. :. les. proniinczed than trhe decline in industrial -*bivity. Upon
that basis it is probrbie rthat oly a sli-.t recession will o.-cur in the
domestic demand for fa.rm products. :zie extent of such a. rec-c1Cion will depend
upon the race and len.:tn of tiz.e during which industrial wcti-ity c-n.tinues to
drop off.

Index numbers of nonagricultural income

(1924-29 = 100, adjusted for seasonal variation)

Year Jan. Feb. Mar. Apr. June Aug. : Oct. ITov. : Dec.


Average :
1929-3S : 35.2 85.1 85.4 85.0 s .4. .7 4.5 sh.2 84.1

1935 : _?. SX.l 7.9 87.0 86.1 88.0 89.0 89.5 90.3
1939 : 90,. 90.6 91.1 90.1 91.7 93.1 95.- 96.2 97.2
1940 1/: 97.5 97.2

/ Prclinmirv-ry.




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