Wheat situation

UNITED STATES DEPARTMENT OF AGRICULTURE
Bureau of Agricultural Economics
Washington

WS-8 June 21, 1937
1--------~-------1------------------"
THE WHEAT SITUATION
Including Rye
---------------------- -------------

Estimates of area and condition reported to date indicate that wheat

production in the Northern Hemisphere may total about 3,400 million bushels

or even less, the Bureau of Agricultural Economics reports. If crop con-

ditions in the Southern Hemisphere countries are about average, world

production, excluding Russia and China, may be expected to total from 3,800

to 3,850 million bushels, or about 300 million bushels more than in 1936-37.

The outturn of the spring wheat crop of the United States, the Canadian crop,

and the European crops is, of course, still uncertain. Errors in early esti-

mates by countries in the past have been largely compensating, causing the

total estimate to be fairly indicative of the production as a whole. Un-

usual developments, such as widespread rust damage, of course, would be

expected to modify such indications.

World stocks of old wheat, excluding those of Russia and China, about

July 1 seem likely to be reduced to about 530 million bushels compared with

about 760 million bushels in 1936 and 675 million bushels, the 1924-28 average.

If the indicated world production is realized, the-world's wheat supply for

the 1937-38 season would be around 4,350 million bushels, or only little

greater than the 4,295 million bushels in 1936-37; and with the world disap-

pearance about 3,765 million bushels, the average of the last 2 years, stocks

at the end of the marketing year would still be below normal.

Stocks of wheat in the United States on July 1 will be at the lowest

level since 1919. It now seems likely that total stocks of old wheat on

hand will be only about 90 million bushels. While stocks of most classes will

be low, stocks of hard red spring wheat will be especially small. Total indi-




WS-8 2 -

cated winter wheat production contains less than the usual proportion of hard

red winter wheat, and if the total spring wheat production amounts to only

between 175 and 200 million bushels, as indicated by the June 1 condition,

the hard red spring wheat crop may be short enough to again require con-

siderable substitution of other wheats, mostly hard red winter.

Wheat prices in the futures markets of the United States have already

adjusted to an export basis. The relation of price spreads to exports in

past years indicates that the present spread is sufficient to result in the

exportation of a considerable quantity of hard red winter wheat. With the

fairly good crop of wheat in the Southwest, a continuation of the present

price spread might induce exports in the early months of the season in excess

of what might be justified on the basis of supplies and prospective require-

ments by classes of wheat.

Notwithstanding the fact that futures markets have adjusted to an

export basis, some further adjustment in cash prices is likely. Cash prices

are still on a comparatively high level on account of the scarcity of old

wheat on hand. As the new wheat supplies which have now started to move from

the Southwest increase in volume, cash prices are likely to adjust downward

relative to prices in importing countries. Should downward adjustments in

cash prices in the next few months be accompanied by significant exports,

prices would be expected to advance later in the year, both because of the

elimination of the surplus above usual domestic requirements and the pro-

spective strengthening of world markets.

Prices in important domestic and foreign markets will continue to be

unusually sensitive to crop developments, in view of the close adjustment be-
tween world wheat requirements and supplies, and the prospects that total world
supplies in 1937-38 may not be much larger than during the season just ending.
Crop developments in the United States and Canada will be particularly
significant because these two countries will be important sources of export
supplies until the Argentine and Australian crops become available next winter.






- 3 --


S THE WORLD WHEAT SITUATION

BACKGROUiD Total world supplies of wheat, excluding
those of China and including. only -net exports from Soviet
Russia, averaged 4,100 million bushels for the 5 years,
1923-24 to 1927-28, increased to .5,013 million bushels in
1933-34, then declined sharply as a result of successive.
years of small production and increased world demand. Total
world supplies for 1936-37 are estimated at -4,293 million
bushels compared with 4,522 million bushels for 1935-36
and 4,696 million bushels for 1934-35.

Total world shipments of wheat averniged 751 million
bushels for the 5 years 1923-24 to 1927-28, increased to a
peak of 913 million bushels in 1328-29 (July-June), then
declined sharply. Total imports in 1936-37 were estimated
by the Bureau of Agricultural Economics .at about 590 million
bushels.

World market prices of wheat have been moving steadily
upward since the spring of 1933, reflecting higher world
commodity price levels, three successive below averg,-
harvests in North America, and last season's short Southern
Hemisphere crops. During the current season, world )rices
have advanced sharply as a result of increased demand and the
smallest supplies in recent years.

World Crop Prospects _/

The wheat acreage in the 22 countries for which reports are now avil-
able is reported at 195.9 million acres (table 3), or a 10 -ercent increase
over the 1936 acreage in the same countries. These countries in 1936 repre-
sented about 85 percent of the total wheat acrc,--e in the Northern Hemisphere,
excluding Russi, and China. The increase this year is the result of the
increase in the United States acreage; Eur-'pe, Africa, and India all ch.ow
decreases.

The official estimate of the spring wheat crca.e in Cr,-.da has not
yet been released. Farmers' "intentions-to-plant" indicated.a 1 percent
decrease from the 1936 acreage. Unfavorable .;ea.ther conditions over large
areas, however, have probably reduced the acreage somewhat below that indi-
cated by the intentions to plant. Throughout most of Eastern Canad?., spring
seedings have been retarded by cool '-eather and abundant rainfall. In the
Prairie Provinces, as a whole, heat seeding was virtually completed June 1.
For all Cn.r'ida the condition of wheat on 1lay 31 was 85 com-parod with a condition


1/ See page 7 for discussion of the domestic crop prospects.


WS-8






- 4-


of 95 a year earlier. Drough.t G'cndition' have continued to prevail in southern
SaskatchEcan, and, according to the report of the Dominion Bureau of Statistics
on June 15, rainst''i .thattarea would. no-w be too 'late to improve grain crop
prospects materially .Timely rain in Alberta during the first half of June,
however, is reported to6-haVe arrested-the threatened crop deterioration, and
bright ,.'?rm weather'is b rining growth along raoidl, in that Province as v.'ell
as in Manitoba.

Reports of the.wheat sowings in Europe are still incomplete. In the 15
countries for which reports have been received, the acreage is estimated at
59.9 million acres, compared with 60.7 million rcres son.7 in the same countries
for harvest in 1936. These totals are comprised largely of winter wheat, since
spring -,'heat estimates for the current season are available for very few
countries.

Spring; wheat acreage in Europe, ho,.ever, comprises only a small percentage
of the total wheat acreage. It -no;w .seems Pioobable that most European countries
will harvest average or below average crops of wheat and rye this year. Spring
seedings have been made under very difficult conditions. Cool, rainy weather
was widespread over Europe during March and April, linking it impossible, in
most cases,, to increase spring heat seedings, as had been planned in many
countries to offset decreases thl.t occurred at planting. time last fall ::hen un-
favorable weather nrevailed.- This, together with an above normal winterkill
and other damage,, now -points to the possibility of.a total European cro-o about
the same as the small production of -last year. :The -most fav6orble outlook, nt
present, seems to be in the Danubian countries and in Greece and Tunisin.
Some increase over last year's poor crop may be recorded in France, Ital,, and
Soain. The Paris office of the Bureau of Arricultural Economics estimates the
crop in Italy to be 257.2 million bushels. This comrnares favorably with the
short crop of 1936, "ihen 224.3 million bushels were reported. The official esti-
mate of production in Bulgaria is 64.0 million bushels, compared with 55.8
million bushels last year.

Winter wheat acreage in the Soviet Union, as -rovided for in the Plan,
exceeds that of last .;e-ir by 6 percent. No definite information is available
as to whether the plamned acreage has been seeded. On May 25, t-.o total spring
sov ing program was 90 percent accomplished, conmared with 93 percent on the
r.ne date a year earlier. Winterkill ab-oears to have been -re-ter t'aan last year
and above averaGe. ;-ed.- growth is reported to.be'bad this. year and ma/ -ffect
yields.

The acre-.oe reported in the four North African countries represents a
reduction of 2 percent from that of last yc'r. Although-some increase in the
crop is expected this ,ye'r, connp red with last, -the! harvest seems liklcly to be
well beloc average. Tunisia is the only co rtry ~ wh- ich- is expected to have a
very good crop, and it is the lost important of the North African countries
from the stand-3oint of wheat -rodhction. Production in lMorocco this year is
officially estimated to be 17.6 million bushels. This is far below the average
crop, though better than last 'rear's very small production. Algeria reports a
crop of 32 million bushels, compared with 29.8 million bushels in 1936.






- 5 -


The May estimate of acreage in India is 32.7 million acres, as com-
pared -ith the April estimate of 33.6 and the May, 1936 estimate of 33.5 million
acres. The production estimate has been lo 'ered to 359.3 million bushels from
the Arril estimate of 392.3 million bushels. This is slightly above the final
estimate of the 1936 crop, which was placed at 352.2 million bushels.

The Shanghai office of the Bureau estimates the wheat crop in China to
be in the neighborhood of 650 million bushels, or about 17 percent less than
thE production in 1936. Conditions over central and northern China last year
were very dry for seeding, and over much of northern China the drought was un-
relieved. Samples of early wheat are of a somewhat better quality than last
year, as the moisture content is lower. The crop in Japan is estimated at
50.5 million bushels, compared with 45.9 million bushels in 1936. This is an
increase of 10 percent over last year. Production in Manchuria is estimated
to be 15 percent above the 1936 crop.

In Argentina there is a continued deficiency of moisture. Good rains
are needed to germinate the seed.

Wheat is obtaining a good start in Australia, other than in IHe South
Wales, where dry conditions prevail.

Supplies and trade

After 4 years of short crops it is expected that by the end of July
the United States will be exporting significant quantities of wheat again.
Until that time Canada and Australia are the only important sources of supplies,
with the Danubian countries and India minor competitors.

The quantity of wheat available for export or carryover in the principal
exporting countries as of June 1 is estimated at 145 million bushels this
year compared with 267 million bushels in 1936 and 373 million bushels in 1935-
The addition of United Kingdom port stocks and quantities afloat results in
a total of 200 million bushels this year compared with 308 million bushels last
year and 418 million bushels 2 years ago. T,.ble 4 sho--s the stocks figures
for th last 4 -yearf, by countries.

3n the basis of shinments to date, the Caro.dian figure niiht be ex-
;,ected to be reduced from t3 million bushels on June 1 to about 50 million
bushels on July 1, the Argentine figure to about 20 million bushels, and the
Australian to about 35 million bushels.

India has again entered the -orld wheat market this year, shipping
about 10 million bushels since July 1, 1936, which is the largest quantity ex-
ported since 1927-28. Indian wheat is generally sold at a disadvantage, be-
cause of the -_'esence of a relatively high percentage of other grain and
foreign material. Soviet Russia continues to remain out of the market. On
June 1 the surplus in the Danubian countries had been reduced to about 25
million bushels. As hcs been pointed out in previous issues, the large ex-
portable surplus of about 100 million bushels in the Danubian countries this
season has served to prevent a very tight situation in some European importing
countries.





Ws-g


The grain noveme-At for the principal countries this year compared
with that of the corresponding periods during the past 2 years is shown in
tables 4 and 10.

Forci,-,n wheat prices 2/

Liverpool and Winnipeg prices decline since the middle of May, in-
fluenced by new crop prospects and less concern on the part of European
buyers regarding future supplies. The decline, however, was checked in
early June when dry conditions in southern Saskatchewan in Canada, and
Montana in the United States were unrelieved, and rust was reported as far
north as Nebraska. For the week cnd-d June 12 the daily closing prices of
July futures at Liverpool averaged 126l cents compared with 141 cents for
the week ended May 22.

During the past month Canadian prices have become more favorable to
exports while those at Buenos Aires have become less favorable. July futures
at Winnipeg for the week ended June 12 averaged 10 c-nts under those at
Liverpool compared with 6 to 8-cents about a month earlier. July futures
at Buenos Aires, on the other hand, were only 12 cents under the Liverpool
July contract compared with 20 cents for the week ended May 22. Futures
prices at these markets together with those at Chicago, Kansas City, and
Minneapolis are shown by weeks in table 1. Heavy early season shipments from
Argentina so reduced the supplies in that country that there will be little
or no further sales to Northern Hemisphere countries until the new harvest
at the turn of the year.


THE DOMESTIC WHEAT SITUATION

BACKGROUTr D.- The carryover of wheat in the United
States for the 5-year period (1924-28) averaged 115
million bushels. Stocks which began to accumulate in
1929. reached the record peak of 378 million bushels
in 1933. Four small wheat crops since that time, how-
ever, reduced stocks to 138 million bushels by July 1,
1936. Stocks on July 1, 1937, are forecast at about
90 million bushels.

Domestic wheat prices since the spring of
1933 have been unusually high relative to world market
prices as a result of four small domestic crops caused
largely by abnormally lo- yields per acre. During the
current season, both world and domestic prices have ad-
vanced sharply as a result of increased demand and the
smallest supplies in recent years.


2/ Domestic prices are discussed on page 7.







7S-


-7-

T.ble 1.-Averane closing-prices of July -heat futures, specified mar-
kits ana dates, 1936 1nd 1937


S: CKansas innere oli: inn peg : Liverpool : Buenos
Chicago lMinneapolis 1 1
Dcte City : __ : LI Aires
:.1936:19337 193: 19L37: 1~3 i93 _l3 1937J 1936: 1937 1936: 1937
Cents Cents Cents Cents C entts Cents Cents Cents Cnt Ct Cnts Cents Cents Cents


o9.4 14. 6
:.9.4 116.0
8S.S 121.9
)8.3 122.4
35.8 118.2


86.5 110.1
S6.7 111.2
(6.0 1-17.0-
86.5 117.9
81.6 115.0


104.1 131.9
103.0 131.1
100.7 135.0
97.3 133.6
93.1 128.3


gS.5 120.0
35.6 121.7
s4.4 131.9
81.6 134.9
77.2 129.5


94.6 127.0
92.S 127.9
93.1 137.2
91.9 )142.0
SS.2 139.4


7e ek
ended-
lMay 1

15
22
29
June 5
12

High j/
Lo7w ;


-7.0 117.6
87.2 118.2
s5.6 116.2
85.7 121.2
i4.4 117.0
S4.7 110.5
34.7 1o. 4

91.8 128.2
,4.4 o108.4


84.2 113.7
83.8 113.9
80.9 112.
81.3 118.8
79.6 114.0
79.9 107.9
79.6 106.4

90.6 123.0
79.6 106.4


96.0 127.6
94.8 127.6
91.0 125.5
92.9 130.6
92.7 129.2
94.3 122.6
94.7 120.8

105.9 141.4
91.0 120.8


80.0 127.7
78.6 129.8
78.0 127.3
76.3 132.5
74.8 127.1
77.2 118.S
76.9 116.8

38.9 143.1
74.8 116.6


91.3 133.9 90.4
90.2 138.4 90.2
89.4 137.7 90.1
87.3 141.2 90.0
s4.4 10. 5 190. 1
85.7 133.92 90.s
65.3 126.5 -91.2


95.2 151.2 _91.9 2129.0
84.4 123.15/89.8 4/114.3


Conversions at noon buying rate
August futurres.
Januaryy, 1 to date.
June, July, and August fv.t irev:.


of exchange


Domestic --nrat rrosnccts

Th. production of all -rheat in the United States was indicated by the
June 1 condition to be from $25 to 850 million bushels compared with only
626 million bushels in 1935 and 1936 an2 865 million buhels, the 5-year
(1928-32) average. Winter --heat production was indicated at 6149 million
bushels compared with 519 million bushels in 1930 and the 5-year (1928-32)
average of c23 million bushels. A probable spring wheat production of 175 to
200 million bushels -as indicated on the basis of the June 1 condition and the
intended acreage reported' in March. The production of spring wheat last year
-,as 107 million bushels, and the 5-year (1928-32) average was 241 million
bushels.

Toward the end of May and extending into June, rain occurred over
most of the Great Plains area, which checked deterioration of the crop
caused by unfavorable conditions during Ma.y, and undoubtedly brought about
some improvement not reflected in the June 1 report. During early June,


i;Ionth-
Jan.
Feb.
Mar.
Apr.
May


1/
2/
k/


119.3
121.6
119.4
121.0
121.2
120.5
114.3


------





WS-8


stem rust was observed in fields as far north as Nebraska. Information
available at this time indicates that the infection is not severe as yet,
and that any material damage to winter wheat from this cause will be confined
to late wheat. Stem rust reported as early in the season as this, however,
naturally gives rise to concern as to the extent of its future development in
the spring wheat region.

While the total indicated winter wheat production is the largest since
1931, it consists of less than the usual proportion of hard red winter wheat.
According to the crop report,only 339 million bushels of hard red winter wheat
is indicated, compared with 393 million bushels in the 5-year (1928-32) average.
The indicated production of soft red winter wheat is 258 million bushels com-
pared with 179 million bushels, the 5-year average.

With conditions only slightly below average in the Pacific Northwest
(on the basis of June 1 condition), where there has been an increase in spring
wheat plantings to rcrlace the larger-than-usual poor stands of winter wheat,
the production of white spring wheat may be expected to be somewhat above
average. If the production of all spring wheat should turn out about as indi-
cated, supplies of the other two classes -- hard rod spring and durum -- would
be limited again for another year. During the past 3 years, 1934-35, 1935-36,
and 1936-37 3/, the United States has imported 6, 25, and 21 million bushels
of hard red spring wheat, respectively, for milling and seed, besides 5, 4, and
8 million bushels of durum, respectively. While the probable quantities of
hard rod spring and durum are not so small as to necessitate imports again,
they would be below normal requirements.

Hard red winter wheat can be substituted directly for hard red spring
wheat, rand to a considerable extent also for durum. During the past year or
so, greater than usual quantities of soft wheats were used in making broad
flour. Substitution again in 1937-38 will involve greater than normal quanti-
ties of other wheats, especially hard red winter, and will thereby tend to
reduce the amount of such wheat exported.

The carry-in of hard red winter wheat on July 1 is expected to be about
45 million bushels end the new crop 339 million bushels, making a total supply
of 384 million bushels. Assuming a ,normal" disappearance of bout 270 million
bushels and a carryover of about 40 million bushels, there would remain only
about 75 million bushels of hard red winter wheat in excess of usual needs.
This could easily be reduced by 50 percent or more, depending upon how small
the production of hard red spring wheat and durum turned out to be.

The carry-in of soft red winter wheat on July 1 is expected to be about
17 million bushels and the new crop 258 million'bushels, makinG a total supply
of 275 million bushels. Assuming a "normal, disappearance of about 180 million
bushels and a carryover of 20 million bushels there would remain about 75
million bushels of soft red winter wheat in excess of normal needs.

3/ Imports for 1936-37 estimated on the basis of July-April imports.


- 8 -






-9-


No estimates of white spring wheat are available,but, because of the
opportunity to reseed poor stands of winter wheat with spring wheat in the
important producing region of the Pacific Northwest, white wheat supplies may
be average or better than average. While the Pacific Northwest may, there-
fore, be expected to have about its usual excess over local requirements,
inasmuch as the United States will be a net exporter of wheat .again, prices
in Gulf and Atlantic points are not expected to be high enough to. attract
shipments of soft wheat from the Pacific Northwest to .these points as has been
the case in the past 3 years. Some flour, however, would be expected to be
shipped to Eastern coastal points, as was the case in the 20's. Shipments' of
wheat and flour in terms of wheat to eastern points in the United. States for
the 1933-34 to 1935-36 period during which time prices, east of the Rockies
were above export levels averaged 15 million bushels compared with an average
of 2-million bushels for the 10 years, 1922-23. to 1931-32.

Domestic wheat prices

Wheat prices in domestic markets, influenced by the same factors as
prices in Liverpool _/, declined during the last half of May.and early June.
Prices of July futures in Chicago and Kansas City fell to the lowest level
since last November. No, 2 Hard T"inter wheat at Kansas City declined from an
average of 132 cents for the week ended May 22.to.123 Cents for the week ended
June 12. The average price received by farmer$ for wheat on May 15 was $1.18
compared with $1.27 on April 15 this year and 82 cenns.on May 15, 1936. Table
5 shows average cash prices in important domestic markets, and tables 1 and 6
show cash and futures prices in selected foreign as well as domestic markets.

Wheat prices in the futures markets of the United States have already
adjusted to an export basis. Chicago July futures averaged 18 cents and those
at Kansas City 20 cents below those of Liverpool for the week ended June 12.
Some further adjustments, however,.are likely in cash prices, which are still
on a comparatively high level on account of the scarcity of old wheat on hand.
Some new wheat has now started to move to market in the Southwest, and as the
new supplies increase in volume, cash prices are likely to adjust themselves
downward relative to prices in importing countries. An active demand for new
crop '.-heat early in the season, however, will tend to act as a buffer to any
price decline. Domestic mills which have permitted their stocks to decline
to very low levels are expected to compote actively for new crop wheat to re-
plenish their stocks. Moreover, relatively high corn prices in the United
States may lend strength to wheat prices in the event that foreign prices of
wheat should decline materially. Should the downward adjustments in the next
few months be accompanied by significant exports, prices would be expected to
advance later in the year, not only because of the reduction or elimination
of the surplus from the United States but also on account of the strengthen-
ing of world markets.


L/ See page 6 for foreign prices.


ws-8





Table 2.- Wheat acre-dc sown in specified countries, 1935-37


Country
: 1935 :
:1,000 acres:


United States:
*Winter I/ ......................
Spring .. ..........................
Canada (total) ....................:
Total (2) ................. .
Eurone:
Brni.ium / ...................
Czechoslovakia ...................
England and Wales ...............
France .........................
Gerrrany 3/ ............... .... ... :
Greece .......... .... ....... ...
Italy ... ....... ....:
Latvia 3/ ..................
Lithuania / ..................
Luxemburg 3/ ..................
Poland 3/ ......................
Total (11) ..................
Bulgaria 3/ .... ....... .....:
Hungary 3_/ .....................
Rumania 3/ ....................
Yugoslavia 3/ .................
Total (4) .................
Total Europe (15) .........:
Africa:
Algeria ................ ..... :
Tunisia ........................
Egy- t ....... ........ ......
Morocco ............ .... :
Total Africa (4) ...... ...:
Asia:
India (::-; estimate) ...........
Total 22 countries .........:
Russia ...........................:


33,402
17,827
24,116
75.345


75.345


380
2,387
1,772
13,251
4,754
2,092
12,367
210
414
43
3,756
41,426
2,846
4,154
7,740
5. 367
20, 107
61.533


4,095
2,026
1,463
3,616
11.200


34,482
182,560
32.506


Estimated INorthern HemisDhere
total acreage, excluding :
U.S.S.R. and China ..........: 216,200 :


1937
1,000 -cres


m


Yenr of harvest
1936
1,000 acres

37,608
11,212
25,289
74.109

420
2,296
1,704 :
12,711 :
4,757
2,128
12,683
146
349
44
3.734
40,972
2,586
4,045
7,719
5,368
19,718 :
60,690

4,287
1,221 :
1,463 :
3,194
10,165 :

33,494
178,458
34,721


211,600 :


431
2,123
1,670
13,022
1/ 4,263
2,076
4/ 12,862
154
388
44
3,647
40,680
2,842
3,706
7,253
5. 42
19,143
59.823


3,855
1,952
1,415
2,743
9.965


9.965


32.720
195.850
5/ 36,797


Compiled from official sources except as otherwise noted.
I/ Winter acrea-.e remaining for harvest.
2/ Indicated for harvest.
/ Winter wheat.
/ Estimated in the Paris office of the Bureau of Agricultural Econo.ics.
/ Are provided for in the Plan.


Jw :-


47,410
2/ 20,918
25,014
93. 342


93.34


-i




- 11 -


Table 3.- Spreads between domestic wheat prices and prices at
Winnipeg and Liverpool, specified periods, 1934-37

: Futures per bushel :Cash wheat per bushel
: Amount Chicago :Amount Knnsas City :Amount "o. 2 Hd. Winter
S. avcr-ged aver~e cd :(Kans-s City) averaged
i{onth and year : above abovo : above
:Winnipeg :Liveroool:Winnipe; :Liver-ool:No.3 Mani-:
SParcels
j- uly -'July July : July : (itobae) (Liverpool)
J ul y : Winnine.z)*:
: Cents Cents Cents Cents Cents Cents
January -
1934 ........ : 18 18 11 i1 25 15
1935 ..........: 8 13 4 9 29 23
1936 ...........: --1 --5 -2 -8 34 13
1937 ..........: -5 -12 -10 -17 18 6
March -
1934 ..........: 17 18 10 11 20 15
1935 ..........: 8 16 5 13 23 17
1936 ..........: 4 -4 2 -7 30 14
1937 ..........: -10 -15 -15 -20 8
hay -
1934 .........: 16 18 8 11 20 19
1935 ..........: 5 13 4 12 21 15
1936 ..........: 9 -2 4 -7 24 8
1937 ..........; -11 .. -21 -14 -24 6 -9
e7cek ended
June 12 -
1934 ...........: 18 25 11 18 21 1/
1935 .........,: -1 3 -2 2 16 L/
1936 ..........: 8 -1 3 -6 18 1/
1937 .........: -8. -18 -10 -20 10 1/


i/ Price of -nrcels at Li.erpool not nvpilpble.

bnble 4.- Exports of -.hent and wihect flour from the United
St-tes, 1935-36 and 1936-37 I/

WhVeat : hct flour : Vc*ht
Date : : including flour
: 1935-56 : 1936-37 : 1935-36 : 1936-37 : 1935-36 : 19.6-37
:1,000 1,C000 1,000 1,000 1,000 1,000
bushels bushels barrels barrels buslhls bushels
July Apr. : 251 2,003 2,715 3,245 13,295 17,254
Week ended :
lay 8 13 66 23 41 121 259
15 : 0 75 25 28 118 207
22 1 '74 22 34 104 234
29 0 79 20 31 94 225
Junl 5 0 81 18 35 85 245
12 0 512 36 43 169 714


Includes flour milled


Com-iled from reports of the Department of Commerce. 1
in bond from foreign wheat.





- 12 -


Table 5.- Wheat sn-p-ius for export or carryover in the three principal
Sexportiri countries, United Kingdom port stocks and
stocksafloat, June 1, 1934-37 1/


Position:


. 1934 : 1935 1936 1937
:Mil bush. Mil. .bush. Mil.bush. Mil.bush.


Canada:
In Canada **..*. .,,...**.*.....;
In United States .............:


233
5


223


173 63.
13 8


13.
Argentina *...*......* .......... .: 123 81 38 26
Australia ......................: 90 60 43 48
Total ........... .... : 451 373 267 145
United Kingdom port stocks .......: 14 10 10 13
Stocks afloat to:
United Kingdom .........,........: 10 15 14 14
Continent *....*........... ...: 10 10 9 20
Orders .......... .*........ .: 10 10 8 8
Total ............. ..,* 44 45 41 55
Total above ...... ... 495 418 308 200
1/ Carryover at the beginning of the year (Canada, July 31; .rgentina, January 1;
Australia, December 1 of the previous year) plus production,'minus.domestic utili-
zation for the year, minus monthly exports to date.


Table 6,- Weighted average cash price of wheat,specified
markets and dates, 1936 and 1937


:All classes: No. 2 : No. 1 : No. 2 Hd. : No.2 : -Western
: and grades:Hard Winter:Dk.N.Spring:Amber Durum: Red Winter: White
Date :six markets:Kansas City:Minneapolis:Minneapolis: St. Louis : Seattle I/
S :1936 :1937:1936 :1937:1936 :1937 :193" :1937:1936 :1937 :193 : 1937
:Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents
Month-


112.6
110.0
105.9
102.0
S94.9


138.0
136.5
138.6
140.0
132.0


100.8 134.0
96.0 135.6
93.3 129.7
93.7- 131.9
90.5 130.3
91.3 127.2
89.4 123.4
118.0 144.5
89.4 123.4


132.6 165.9 119.9 171.3'108.7
131.1 159.4 121.4 170.0 109.0
123.9 153.0 113.8 183.2 107.9
122.6 155.9 105.8 172.0 106.7
113.6 146.3 106.0 128.4 101.7


121.3
117.9
10G.4
112.2
114.4
119.5
118.2
135.4
108.4


150.4 108.8 124.6 1051.6
141.6 103.5 127.8 102.4
146.3 105.9 127.9 99.5
147.4 107.8 129.7 101,2
145.6 107.1 128.2 100.3
139.4 103.6- 117.2 99.7
136.3 105.1 109.9 95.4
169.8 123.1 206.2 110.9
136.3 103.2 109.9 95.4


139.6
143.2
143.0
143.6
131.9


135.5
135.8
130.7

131.8
125.0
123.1
147.4
123.1


1/ Weekly average of daily cash quotations, basis No. 1 sacked.
2/ January 1 to date.


Jan.
Feb.
Mar.
Apr.
P ay
Week
ended
May 1
8
15
22
29
June 5
12
High 2/
Low 27


:106.6
:107.1
98.1
:94.9
.90.0


93.0
:91.8
87.4
89.7
:90.1
:90.6
90.1
:108.4
: 7.4


144.3
138.5
141.6
140.8
131.5


131.8
133.0
129.8
132.3
131.0
123.7
123.3
149.6
123.3


88.9
86.3
86.4
84.9
80.5


83.8
82.3
80.0
80.6
78.4
78.3
78.1
90.2
78.1


112.2
114.4
117.0
119.5
115.8


116.8
117.8
112.1
118.2
115.2
110.0

122.0
109.5


lr~__ -^---ll~_-__L--IY-


ICll--- ____ _II


WS-8





Table 7.-


Date


13 -
Averge rice per bushel of w;hert, snecified m.r'-Ycts
and d-.tes, 1937


City
1-


Je. .. ........:

Febr. ...........
fr.a ............
Aur. ...........:


Lar. . : .
JoCk. c0e !c.-.:
ay 1 ......... :
8 ........ "-
15 ......... :
22 ......... :
29 ....... :
June 5 .........:
12 .........:


Cents

133.0
136.5
138. S
140.0
132.0


134.0
135.6
129..
131.9
130.3
127.2
123. 4


: :
:I.inrne -v.)-1 is:
: 2/ :


Cents

165.9
159.4
153.0
155.9
146.


150.4
1-11.6
146..
147.4
145.6
139.4
136.3


Vinni- "Buenas
0C:J: 'Aires
/nt : en

Cents Cents


120.2
121.1
1.30. 3
135.0
125.7


123.8
125.2
123. 5
129.1
123. 9
116.2
113.2


91.3
99.5
114.2
123.4
122.5


122.2
123.9
121.2
122.5
122.9
122.1
115.= -


* Liver-


ro: o


Cents


126.7
124.7
123.0
143.5
141. 1


135.8
138.4
139.4
143..1
142.5
1:3.9
126.5


:Gr.-. t
:Britain


Cent s


129.0
119.4
119.1
123.2
130.1


132.4
170.0
130.1
129. 1
1.31.2
130. 9


Berlin



Cents


2.23
"C. .
n ?-
--.4.'-



. C-

2.23


Prices .re nver-:es
follow -s: Berlin n:


of daily prices for


prices are


t',e week endin


Saturday except .2


.'e dnesda- qucttati)ns. Prices at foreign ,.anr:ets


are converted to United States Mnney at 'the current rtes of exchan-e.

Ij ITo. 2 V-rC '..'inter.
2/ -No. 1 Dark Kirth.-,rn Snrin;. i:o. 1 Heavy for .::eek ended Februry 6.
3/ No. 3 :anitsb. Iforthern.
4/ Nco.r ft;tLres.
5/ H:ne-.rc.-:.n '-.eat in En;lan-.d n;.d '"ales.
6/ Centr 1 C-en.:rn wheat, :holesle trn.dc rice free Centrn! German Stati-,.


Table 8.- Shinmcnts of --'est, includin- fl:ur from nrinciIal
c;-oortinj countries, soccified datcs, 1935--6 and 1936-.3


D Arcn tina Australia Danube I ort, America
DSte '--: -
:1925-36:1936-37:;1935-6: 19..6--7:1935-.33: 1975-37: 1935-.7: 1926-.77


: 1,000 1,000 1,000 1,000 1,00 1,000
:bushcls bus'.els bushels bushels 'bush'ls bus'-.ls


1,00'' 1, 000
bush'e.l' bus-.els


July Ar.
J7cck ended :
May 8 ..
15 ......
22 ......
29 ...... :
June 5 ......:
12 ......


69,G24 150,538 96,396 80,780 8,169


952
1,136
1,228
560
1,456
0 1in


1,696
2,076
2,004
2, 004
1,008
2,711
1 "101


.J f-J L. .OL ).


1,852
2, 334
1,872
1,796
1,540
1,264


2,236
3,056
3,220
4,312
3,794
2,235


53,720 167,734 192,102


2,640
1,616
1,616
2,400
920
976


6, 330
5,216
6,320
5,552
.,-100
6,912


2,792
4, 832
1,854
2,728
2,83.5
3,86


onmnilec front Broomhall's Corn


Tradc rJc-75s.





- 14 -


Table 9.-Movement of heat, including flour, from principal exporting
countries, 1933-34 to 1936-37

: Exports as given by official sources
Country : Total : July 1 to date shown : Date
:1933-34:1934-35:1935-36:1934-35:1935-36:1936-37:
: 1,000 1,000 1,000 1,000 1,000 1,000
:bushels bushels bushels bushels bushels bushels


United States ......: 37,002
Canada .............:198,555
Argentina s.........:144,854
Australia ..........: 86,509
Russia ..... .....: 33,787
Hungry ............: 29,615
Yugoslavia .........: 839
Rumaniaa ...........: 248
Bulgaria ...........: 4,236
British India ......: 2,084
Total ............:537,729


21,532
169,630
187,000
108,010
4,286
12,499
4,401
3,432
375
2,318
513,483


15,930
237,447
76,577
102,258
29,704
14,644
728
9,996
987
2,529
490,800


18,911
147,488
174,763
82,060
3,819
8,855
3,888
0
7
1.496


13,295
180,412
72,547
78,430
28,565
10,310
142
9,996
954
1.462


17,254
189,497
157,925
65,669
3,499
22,643
12,753
5,042
5,235
11,479


Shipments as given by trade sources


S Total : Week
:1934-35:1935-36:May 29


: 1,000
:bushels


North American V/ ..:162,832
Canada,4 markets 2/.:176,059
United States ......: 20,997
Argentina ..........:186,228
Australia ......... :111,628
Russia ............: 1,672
Danube & Bulgaria 3/: 4,104
British India ......:4/2,318
Total 5/ .........:468,782
Total European ship-:
ments 1 ........:88?,752
Total ex-European :
shipments 1/ .....:147,938


1,000
bushels

219,688
246,199
14,207
77,384
110,060
30,224
8,216
4/2.529
448,101


1,000
bushels


2,728
2,851
225
1,008
4,312
0
2,400
48


ended
:J'une 5


(i 9q7)


:June(


1,000 1,000
bushels bushels


-2,835.
2,915
245
2,711
3,794
0
920
48


3,861
2,674
714
1,181
2,285
0
976
792


355,032 10,456


133,528


1,504


: July 1
12:1935-36


1,000
bushels


205,224
235,374
6,905
75,896
107,604
29,024
8,168
320
426 236
6/
328 824
6/
118,304


Apr. 30
Apr. 30
May 31
Mar. 31
Mar. 31
Mar. 31
Mar. 31
Mar. 31
Mar. 31
Jan. 31


- June 12
:1936-37
1,000
bushels


214,014
189,253
9,537
161,214
99,683
88
63,888
10,320
549,207
6j
144,456
116,456
116,456


1/ Broomhall's Corn Trade News.
2/ Fort William, Port Arthur, Vancouver, Prince Rupert, and New Westminster.
3 Black Sea shipments only.
4 Official.
5 Total of trade figures includes North America as reported by Broomhall's,
but does not include items 2 and 3.
6/ To May 29.


VS-8


-


r f


g


--


I


--


rd


I


I





- 15 -


Table 10.-Net imports of wheat, including flour, into European
year beginning July 1, 1935-36 1936-37


countries,


: : Net imports reported
Country : 1935-36 : 1936-37 :July 1 :1935-36 :1936-37
: : forecast 1/: to : :
: Million : Million : : Million : Million
: bushels :bushels : : bushels : bushels
Austria ............: 7 : 10 : Mar. 31 :6 7
Belgium ............: 39 42 : Mar. 31 : 29 31
Czechoslovakia .....: 1 : /-7 : Mar. 31 :1 : / -5
Denmark ............: 9 10 : Mar. 31 :6 6
Finland ............: 4 3 Mar. 31 :3 3
France ............: 7 22 :Jan. 31 : 7 4
Germany ............: 3/ : 18 :Mar. 31 3/ : 1
Greece .............: 15. :17 Mar. 31 : 10 : 12
Irish Free State ...: 15 : 11 : Apr. 30 : 12 : 11
Latvia .............: 2 -2 1 : Mar. 31 : 2/ -2 : 3/
Netherlands ........: 21 : 22 : Apr. 30 : 17 : 18
Norway ............: 8 : 8 : Apr. 30 :7 6
Poland ............: 2 -8 2 -6 :Mar. 31 2/ -6 2 -6
Portugal ..........: 2/ -3 3 : Mar. 31 :1 3
Spain .............. 4/ : 6 : Mar. 31 : 3/ --
Sweden ............: 2/ -2 : 1 : Apr. 30 :2/ -2 :
Switzerland .......: 17 : 17 : Apr. 30 : 13 : 16
United Kingdom .....: 205 220 : Apr. 30 : 167 : 168
Total imports of :
above ........: 348 : 411
Italy ..............: 7 : 62 : : :
Total imports ....: 355 473 : : 279 : 283
Total exports ...: 15 : 13 : : 10 : 11
Total, net imports: 340 460 : : 269 : 272
Compiled from official sources, except as otherwise stated.
ij Based largely on estimates of the Foreign offices of the Bureau of Agri-
cultural Economics.
2/ Net exports. 3/ Less than 500,000 bushels. 4/ Net exports of less than
500,000 bushels.

Table 11.-Durum wheat: Area and production in Morocco, Algeria, and
Tunisia, average 1930-34, annual 1936 and 1937


Country Acreage Production
:1930-34 : 1936 : 1937 :1930-34 : 1936 : 1937
: 1,000 1,000 1,000 1,000 1,000 1,000
: acres acres acres bushels bushels bushels

Morocco ..............: 2,179 2,402 2,051 207,343 84,877 102,881
Algeria .............: 3,022 3,232 2,812 225,935 186,509 176,368
Tunisia ..............: 1,745 890 1,606 91,344 44,092 102,881

Total .............: 6,946 6,524 6,469 524,622 315,478 382,130
From report of the Paris office of the Bureau of Agricultural Economics.




- 16 -


THE*'RYE SITUATION


SBACKGROUNDD- Rye production in the:United States
before the'nar about equaled domestic utilization.
S During the:'ar, acreage -as increased and large ex-
Sports followed. In 1933 and 1934, production -as re-
Sduced by drought 'conditions to less than the amount
Normally used in the United States, and a considerable
: amount of rye was impdrted.- A large crop in 1935
greatly reduced but did not eliminate imports.


The.production of rye in the United States, as indicated by condi-
tions on June 1, 1937,'is 46 million bushels compared -with'2- million bushels
in 1936 and the 5-year (1928-32) average of 38 million bushels. During May,
conditions were generally favorable for.the crop in the North' Central States
and prospects improved* in all States in this region except North Dakota',
where a moderate decline was -noted:. Above average yields are 'in prospect
in most of the Eastern half of the: country, 7hile below average yields are
indicated in the West, with the poorest prospects in North Dakota, Nebraska,
and Montana. The indicated production 'of 46 million bushels is about equal
to the disappearance in 1936-37, when large amounts were fed because of'the
short feed situation.

United States stocks (July.l commercial.and June 1'farm) at the be-
ginning of the 1936-3t year plus production totalled 52 million bushels
compared with 70 mi-llion bushels in 1935-36. The apparent'disappearance in
1936-37 amounted to 46 million bushels compared -"ith 50 million in 1935-36.
With limited supplies of quality rye for distilling purposes, about 4 million
bushels were imported compared with 2 million an 1935-36. The supply and
distribution of rye in the United States, beginning -ith 1934-35 together with
the-192g-32 average, is shown in table 11.

Rye prices in the United States have declined since April, influenced
by new crop prospects. Io. 2"Rye at Minneapolis averaged 98 cents for the
week ended June 12 compared with 112 cents, the average for the month of
April. Rye prices moved steadily upward during the first half of the season
and then fluctuated around this level, reflecting an active demand for limited
supplies of good quality grain both in the United States and the 'vorld. Table
12 shows No. 2 rye prices at Minneapolis beginning with 1920-21.

In Europe, even with favorable weather for the remaining growing
season, the chance of a rye crop larger than the very, small one of last year
seems unlikely. Although rye suffered less damage from wintorkill than wheat,
it has been adversely affected by the rainy spring. The June 1 condition of
rye in Germany, the largest producing country in Europe, -as barely average;
the condition in Poland and in Czechoslovakia was belo-r average. The con-
dition in Canada on May 31 was 73 percent of normal compared with 86 percent
last year. ..







WS-8


- 1-7 -


Rye acreage, as reported in "The Th,:-at Situation" for May, remains
unchanged. European acr.age, for the 13 countries reporting, is estimated
at 34.2 million acres, -compared with 35.5 million acres in .1936 and 35.6
million acres in 1935.


Table 12.- Rye: Acreage, yield, production, supply, indicated
disappearance, net exports, and price 1919-20 to 1936-37

: :Production : N
:Acre-: Aver- : : orld :U.S.as:. t t end Indi-
.Imports at end
Year age : age : :exclud-: per- : incld-r : cated
beginning : har- : yield :United : ing : cent-: in. :disap-
July ing crop pear-
July :vst-: per :States :Russia : age flour yea pear-
flour year
ed :acre : : and : of / :: ance
__ __ : : : China : world: :
: 1,000 1,000 Mil. Per- 1,000 1,000 1,000
: acres Bush. bush, bush. cent bush. bush. bush.


1928-32 av.: 3,315


11.5 38,212 96.9


3.9 1/2,686


: 2,035
: 4,141
: 2,757
5/ : 4,092


8.4
14.2
9.3
11.2


17,070
58,597
25,554
45,974


94.2
97.6
91.3


1.8
6.0
2.8


11,230 11,283
2,236 22,299
(3,936) (6,200)


--- 71.
49,817 39.5
(45,589) /(80.5)


1/ Total imports minus total exports (domestic plus foreign). For the period 1919
to 1928 net e:.-ports aver.agEi 30,-846,000 bushels a.nuallv-; pre-war production
about equaled domestic utilization. (1 bbl. of rye flour 6 bushels of rye.)
2/ Includes stocks on farms as of June 1 (available only beginning with 1935 and
only for June 1) plus commercial stocks as of July 1.
I3 Net exports.
~/ Preliminary figure published December 1936.
5/ June--1 -indications.


1934-35
1935-36
1936-37
1937-38


Fa rr
price
per
bushel


Cents


55.2


~








Table 13.- Rye,No.2: Weighted average price per bushel of reported cash sales,
Minneapolis, by months3 1915-16 to 1936-37


Crop : July Aug. : Sept. : Oct. : Nov.
year :
: Cents Cents -ents- Ce-- Cn
: Cents Cents Cents Cents Cents


.Dec, : ~Jta.


Feb.


Cents Cents Cents


: : : :Weighted
Mar. : Apr. : May : June :average

Cents Cents Cents Cents Cents


1915-16:
1916-17:
1917-18:
1918-19:
1919-20:

1920-21:
1921-22:
1922-23:
1923-24:
1924-25:

1925-26:
1926-27:
1927-28:
1928-29:
1929-30:


101.9
92.6
220.2.
184.2
153.7

208.7
115.2
76.0
60.8
83.1

95.4
101.8
103.6
110.6
106.5


96.-9,
114.8
175.0
168.0
148.2

191.6
100.5
68.7
62.2
85.7


99.9
96.6
91.7
93.6
97.9


90.1
119.5
184.2
160.0
139.0


185.3
99.1
66.5
65.9
95.0

82.6
93.3
91.8
94.0.
97.1


95.9
126.1
180.5
157.8
136.2

166.2
79.7
71.3
66.1
121.0


77.1
94.9
92.0
93.9
96.8 ."


93.1
143.8
177.3
161.8
138.1

148.3
72.3
81.1
64.1
123.3

81.1
93.5
99.1
97.5
94.5


92.1
137.5
183.3
156.6
166.4

148.9
78,5
83.4
65.1
132,7

98.5
94.2
102.1
96.6
98.0


96.1
141.6
192.6
154.3
173.3

158.0
75.1
81.6
66.7
154.4

98.7
99.1
102.9
103.3
91.1


93.5
134.7
193.4
157.5

160.6
160.6
92.0
75.5


94.2
237.2
184.8
144.7
214.4

126.1
86.2
63.8
69.9
110.5


94.7
141.6
224.1
134.3
153.4

144.0
95.4
80.5
66.2
153.7

90.7
102.2
106.0
104.8
78.3

37.4
46.0
?ip-a


89.0
158.4
291.1
154.1
169.7

142.0
96.9
76.0
62.6
129.9

80.8
98.7
114.3
99.7
66.4

35.7
47.4
35.1


93.1
180.0
274.0
170.6
194.6

128.0
97.1
80.7
61.1
106.4

84.7
99.5
1842.5
88.7
67.9

35.2
44.6
43.3
57.2


54.8
38.8


93.9
225.6
230.3
154.6
208.2

137.0
101.6
72.4
63.0
114.2

82.5
109.4
127.8
85.4
64.9

36.4
38.7
52.4
59.8
54.3


- r ----~---i------- ~---------~-- -- --


: *

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