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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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