Wheat situation

UNITED STATES DEPARTMENT OF AGRICULTURE
Bureau of Agricultural Economics
Washington:

WS-9 July 23, 1937.

THE WHEAT SITUATION
Including Bye




The United States probably will be the world's largest exporter of

wheat -in 1937-38 and at the same time domestic prices are likely to average

higher than in 1936-37 if present prospects materialize. This would make the

19357 wheat crop the most valuable since about 1927, states the Bureau of

Agricultural Economics.

A United States production of 882 million bushels was indicated by con-

dition on July 1. A crop of this size would point to an exportable surplus of

about 175 million bushels, which is about one-third of the combined wheat ex-

ports in prospect for 1937-38 from the surplus producing countries.

With prospective small world supplies and improved demand the adjust-

ment to an export basis, after 4 years of small crops, may be more than offset

by higher prices in importing countries.

Wheat prices during the next few months in both foreign and domestic

markets will continue to be sensitive to new crop developments. Changes in

prospects in the United States and Canada will be especially important, since

these two countries will probably furnish most of the wheat for world trade

until the Argentino and Australian crops are ready for market in January. On

account cf the scarcity of old crop wheat in the United States, the early

movement of the new crop has been taken largely by mills, and prices have been

on a comparatively high level. As mill takings become smaller, it is likely

that some further adjustment in cash prices relative to prices in importing






WS-9 -21

countries will take place. However, if lower cash wheat prices in the next

few months are accompanied by large exports, prices probably will advance later

in the year, both because of the reduction in the exportable surplus and be-

cause of a prospective strengthening of world markets.

Prospective world wheat supplies for the year beginning July 1, ex-

cluding those of Soviet Russia and China, are now expected to be about 65

million bushels below supplies in 1936-37, and the smallest since 1926. A

large reduction in carryover stocks much more than offsets an increase in

prospective production. World carryover stocks of old wheat on about July 1,

excluding thcse for Soviet Russia and China, are now tentatively placed at

about 515 million bushels, or about 245 million bushels less than last year

and the smallest stocks since the World War.

World production outside of Soviet Russia and China is tentatively

placed at about 3,720 million bushels, which is 180 million bushels more than

last year. PRoduction in the Northern Hemisphere outside cf Soviet Russia and

China may be about 210 million bushels more than a year ago. The large pro-

spective increase for the United Str.tes and a small increase for North Africa

more than offset prospective declines for Canada and Asia. Production in

Europe is cp cctod to be about the same or only slightly larger than last

year. In Soviet Russia some increase is expected ever last year's harvest.

In the Southern Hemisphere, where the crop is just being seeded, moisture

conditions to date indicate some decrease in production compared with last

year*


The August issue of this report will contain facts of sig-
nificance to wheat farmers in planning their planting programs. A
separate report on the Summer Outlook for Wheat will not be issued
this year.





- -3-


THE WORLD WHEAT SITUATI0!1


BACKGROUND f- 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 4,299 million bushels compared with4,522 million
bushels for 1'93?5-36 and 4,696 million bushels for 1934-35.

Total world.shipments. of wheat averaged 751 mil-
S- .... lionn bushels for. the 5 years 1923-24 to 1927-28, in-
creased to a peak of 913 million-bushels in 1928-29
: (July--June), then declined sharply.. In .1936-37 they were
_- 610 million.bushels :compared with.490 million .bushels in
1935-36 and 536 million bushels :in 1934-35.

'w .. worldd market pricesg of wheat .have .been moving..
S steadily upward since-the spring:of.1933, reflecting..
higher world commodity price levels, .four.successive
below average harvests in North America.and.the 1935-36
.. short Southern Hemisphere crop. :World.prices .during.
l' 6-37 advanced sharply as a result of .increased.demand
and the smallest supplies in recent years.

Wcrld iwhlat crop prospects .

The first tabulation of the estimates of.production for the year be-
ginnir-nc July 1, 1937, are shown in table 1. .

In the Trairie Provinces of Canada the deterioration.of grain crops
durin- June was the most serious ever recorded this early, in the season. The
worst conditions prcvailed in southern and central Saskatchewan and eastern
Alberta. r'anitoba reported onditions.approximately average on. June 30. For
the Dominion as a whole the condition figure for-all wheat on June.30 4ras 52
percent of the long-time 'average, compared with-the May*31-condition of 85
and the June 50, 1936, figure of 82. The lowest-condition-figure-previously
recorded on this date for all wheat in Canada was in 1033 when-the-condition
was reported as 77. -Conditions in Saskatchewan'have sho'.ni little or no
improver-ent during July. -Scattered rains which, fell during,the second week
helped feed prospects but,dere of little" value.to the grains. Conditions
in Manitoba have continued generally good, although parts'of'the Province
are beccring.dry. If the weather should turn hot'and'humid, black'stem
rust damage' would belikely to reduce yields, since rust'spores are re-
ported 4o be -widbly distributed. -Conditions in'Canada at this time indicate
a total--crop of--about 185nmillion bushels. .(Continued-on bottom of
page 5).'


WS-9




WS-9


Table 1.- Production of wheat in specified countries,
1934-35 to 1937-38


1934-35

: 1,000
: bushels


NORTHERN !WI SPHERE
North America:
United States ***..........:
Canada *............ ... ... :
Mexico .....* **..... ..........:
Total (3) ........ ....:
Europe:
England & Wales ...........:
Scotland *...*..............:
Northern Ireland *.........:
Irish Free State ...........:
N4orway ................. ....:
Sweden **...................:
Denmark ........... .... ....:
Netherlands ................:
Belgium .................. :
France .....................
Spain .,............ ....... :
Luxemburg ******* ................
Portugal .................
Italy ............ .... ....:
Switzerland ................:
Germany ...... .. ........... .
Austria ............... ...:
Czechoslovakia .............:
Greece ......................:
Poland .......... ...... ...:
Lithuania .................:
Latvia .....................:
Estonia ...................:
Finland ...................:
Malta ............... ...... :
Albania ...... .............
Total (26) ............. :
Bulgaria ..*.......... .......
Hungary .... ........ ........ :
Rumania .. .................:
Yugoslavia ............ .....:
Total (4)

Total Europe (30).......:


526,393
275,849
10,950
813,192


65,259
4,144
363
3,803
1,204
27,806
12,847
18,042
16,757
338,513
186,834
1,171
24,690
233,064
5,519
166,547
13,306
50,014
25,679
76,441
10,476
8,051
3,107
3,280
310
1,579
1,298,806
39,595
64,824
76,553
68,328
249,300


1,548,106


1935-36

1,000
bushels



626,344
281,935
10,712
918,991


60,592
4,480
362
6,686
1,869
23, 10
14,672
16,653
16,101
284,950
157,985
1,022
22,092
282,760
5,971
171,481
15,509
62,095
27,180
73,884
10,093
6,520
2,267
4,233
179
1,556
1,274,802
47,925
84,224
96,439
73,101
301,689


1,576,491


1936-37

1,000 :
bushels :



626,461:
229,218:
13,606:
869,285:
.


1937-38

1,000
bushels



882,287
1/ 185,000
(11,000)
1,078,287


51,445: (
3,547: (2/ 55,100
273: (
7,839: 2/ 7,900
2,094: 3/ 2,200
21,525: 3/ 23,000
11,390: 3/ 11,000
16,259: 3/ 14,700
16,153: 4/ 15,100
4/ 253,500: 4/279,200
121,490: 4/139,600
1,026: 1,000
8,651: 4/ 14,700
224,273: 4/264,600
4,468:4/5/ 6,200
6/ 162,663:3-5//143,300
13,514: 3/ 14,000
55,583: 3/ 52,400
23,449: 30,500
78,357: 5/ 66,100
7,949: 5/ 8,300
5,272: 3 5,500
2,433: / 2,600
5,442: 5/ 5,100
236: (200)
1,129: (1,100)
1,099,0 0: 1,163,400
59,304: 7/ 62,500
87,789: 69,629
128,715: 7/106,600
107,421: _/ 88,200
383,229: 326,929


1,483,189:


1,490,329


' Continued -


Country


*


^^ *


:*


:*


:*





- 5 -


Table 1.- Production of wheat in specified countries,
1934-35 to 1937-38 Cont'd



Country 1934-35 1935-36 1936-37 193738

: 1,000 : 1,030 : 1,000 1,000
NORTIERJ HEMISPFERE CONT'D : bushels : bushels : bushels bushels
Africa:
Algeria ...................: 43,528 : 33,532 : 29,74: 31,967
Morocco ...................: 39,5 6 : 20,036 13,42 17,637
Tunisia ..... ........... : 13,779 : 16,02 : 8,03 4/ 18,600
Egypt ................: 37,277 : 43,222 45 ,700: 44,937
Total (4) .............: 134,170 : 113,692 : 96,79, : 113,051
Asia: : : : :
Palestine .................: 3,044 : 3,834 2,795: (3,000)
Syria & Lebanon ...........: 16,279 : 18,520 : 15,998: (15,000)
India .....................: 331,829 : 363,1 : 352,240 359 259
Japan .....................: 47,660 : 48,718 : 45,87': 48,010
Chosen .... ............ ..: 9,268 : 9,747 : 8,025: 11,041
Turkey ....................: 99,712 : 92,640 : 138,486: 7/110,200
Total (6) .............. : .',792 5: 56,638 : 5 3,' 0 510
Total 43 countries ....: 3,0. 'o,260 3,145,812 : 3,012,763: 3,228,177
Estimated northern Hemi-
sphere. total excluding : :
Russia and China .....: 3,079,000 : 3,201,000 : 3,0e6,C00: 3,278,000
SOUTIE7-RN ,EMISPITRE : : :
Argentina .................... 240,669 141,462 247,834: 1/220,000
Australia ..................: 1Z3,39 : 144,217 150,106 (150,000)
Union of South Africa .......: 16,936 : 20,195 : 16,195: (15,000)
Estimated world total, :
excluding Russia and : : :
Chin a ........... ..... 3,527,00 3,571,'' 00 : 3,539,000 3,718,000

Ccmriled from official data except as otherwise noted.
1/ Based on weather conditions to date.
T/ Approxiae tes the estimate of the London office of the Bureau.
3/ Estimate of the Berlin office of the Bureau.
4/ Estimate of the Paris office of the Bureau.
5/ Includes 1]aalin and Spelt.
6/ Includes the Saar.
7/ Estimate of the Belgrade office of the Bureau.

In Europe, excluding Soviet Russia, present indications point to a below-
average crop and one which is about the same or only slightly larger than the
small crop harvested in 1936. Estimates for the 26 European countries, excluding
the Danube Basin, indicate an increase in the heat drop of 6 percent cver
that of last yecr. In the Danubian countries, indications poitt to a
decrease of 15 percent from the record crop of 1936. De:terioration i in





WS-9 6 -

the crop outlook continued through June in many parts of Central Europe
and the Danube Basin; these areas include most of the European surplus
producing countries. Generally speaking, the Mediterranean countries
are expecting slightly larger harvests .than the poor crops of 1936 but
still below average. Increases are reported. in France, Spain, Italy,
and Greece.: Significant reductions are noted in the Danubian countries,
in Germany, .Poland, .and Czechoslovakia. In the Baltic States and the
Scandinavian countries a small increase,:over last year's small harvest
may result if weather conditions continue favorable. In Soviet Russia
the crop outlook is reported to be promising in most regions.

Current estimates of production in North Africa indicate an in-
crease of 17 percent over the small 1936 crop. Significant increases
occur in Morocco and in Tunisia, where increases of 33 and 130 percent,
respectively, are noted. The 1937 production for Tunisia is the largest
on record. A 7 percent increase is indicated for Algeria, but Egypt shows
a slight decrease. '

In Asia the reports received indicate a production 3- percent less
than that of 1936. Slight increases in production for India, Japan-,- nd
Chosen are more than offset by a decrease in Turkey.

In Argentina precipitation has been below normal, and if sufficient
rain does not fall by the end of July, the crop will suffer damage. In
some areas the sowing of wheat is at a standstill because of adverse
weather conditions*

The general outlook for the new Australian crop seems good though
there are complaints of dryness in some sections, notably in Victoria.
The area indicated for harvest this year is 13,700,000 acres compared with
12,351,000 acres last year.'- Conditions were favorable to seeding and early
development of the crop.

World wheat stocks and trade

World stocks of old crop wheat, excluding those of Soviet Russia
and China, on about July 1 are tentatively estimated at about 515 million
bushels which are about 245 million bushels less than stocks last year.
It is estimated that Canadian stocks on July 1 were smaller than a year
earlier by 97 million bushels, United States stocks by 47 million bushels,
Australian stocks 8 million bushels, and Argentine stocks 3 million bushels.
Table 2 shows the surplus remaining for export or carryover in Cuanda,
Argentina, and Australia, together with United Kingdom port stocks and
stocks afloat for the past 4 yeors. Stocks in European countries also are
at the lowest levels in many years. While it is too early to have many
reports from these countries, the evidence at hand indicates that European
stocks are perhaps 85 million bushels smaller than a year ago.

Table 14 shows estimated world stocks of wheat for the past 10 years,
together with other supply figures. The table also shows apparent world
disappearance of wheat and average British Parcels price per bushel cand the
United States average price per bushel to growers, annually since 1927.




WS-9 7

Table 2.- Wheat surplus for export or carryover in the three principal
exporting countries, United Kingdom port stocks and
stocks afloat, July 1, 1934-37 lj

Position : 1934 1935 : 1936 .1937
: -Mil.bush. Mil.bush. Mil.bush. Mil.bush.
Canada:
In Canada ...................: 179 188 124 37
In United States. ...........: 10 9 16 6
Argentina ....................: 107 68 34 31
Australia ,.....................: 83 54 37 29
Total ...................... : 379 319 211 103
United Kinjdom port stocks ....: 15 10 10 10
Stocks afloat to:
United Kingdom ..............: 13 11 14 12
Continent *..................: 10 10 8 12
Orders ..'.... ................: 10 6 5 10
Total .......... ........ : 49 37 37 44
Total above ...............: 428 .. 356 248 147

1/ Carryover at thd beginning of the year (Cao-nda, July 31; Argentina,
January 1; Australia, December 1 of the previous year) plus production, minus
domestic utilization for the year, minus monthly-exports to date.

World trade in wheat i -1937-38 is expected to be below that of
last year, but shipments from. overs eas countries may not be much different
from those of 1936-37. A United States exportable surplus of about 175
million bushels of wheat in .1937-38 is indicated .on the basis of present
prospects 1/, all of which will probably not be exported. Drought conditions
in Canada have so reduced the prospects in that country that exports are
expected to be reduced to 75 million bushels or loss. Exports from Argentina
and Australia combined may not be over 200 million bushels, and those from
the Danubian countries about 50 million bushels. Exports from Soviet Russia
are always an uncertain factor, but if they should amount to as much as 34
million bushels as in 1933-34 and exports from North Afric and miscellaneous
countries should total 25 million bushels,' exports of only about 550 million
bushels or less would result. This would represent a reduction in total
wheat exports of around 50 million bushels compared with last year, and would
indicate that there will be active competition by importing countries for
available wheat supplies in 1937-38.

Last year, overseas countries were prevented from participating
in a considerable part of the benefit of increased trade which occurred
because of the very large surplus in the Danubian countries. With greatly
reduced crops this year in Central.Europe and the Danube Basin, it is now
quite certain that inter-European trade this year will be much smaller than
a year ago.

I. See "Domestic WhTeat Prospects", page 14.




- 8 -


World trade in wheat in 1936-37 (July-June), computed as the total
of net imports by European importing countries and world shipments to non-
European countries, is tentatively placed at 576 million bushels,nwhich is
about 90 million bushels more than a year earlier. European net import
requirements, 2/ excluding those of countries which have net surpluses, 3/
are now estimated at: about 450 million bushels for the 1936-37 season.
This estimate is 23 billion bushels below that published by the Bureau
in March of this year. Reductions in estimates of 14 million bushels for
the United Kingdom, 11 million bushels for Italy, and 8 million bushels for
France, and 2 million bushels for Denmark more than offset increases of 8
million bushels for Germany, 2 million bushels for the Irish Free State,
and 1 million bushels each for Greece and Switzerland. The rather
significant decline in the case of the United Kingdom imports is attributed
to decreased consumption, in France and Italy it is largely due to
statistical adjustments in the apparent supply and trade situation, and in
Denmark to a marked shift from the usual wheat feeding to that of corn and
other grains. Estimates by countries are shown in table' 10. Shipments.
to nonEuropean countries are now placed at 126 million bushels compared
with 130 million bushels in 1935-36 and 120 million bushels, the estimate
used in March. Tables 11 to 13 show figures on movement of wheat in
international trade in 1936-37 compared with other years.

European wheat trade outlook for 1937-38

From present crop conditions and consumption trends no material
change in United Kingdom wheat requirements during the coming season can
be foreseen. In the case of Germany, it is reported that the Government
is already conducting negotiations with Hungary and Rumania for the
acquisition of a considerable part of the 1937 wheat surplus in these
two countries at fixed prices. The large crop in Turkey of last year
permitted exports-of around 5 million bushels during the first 8 months
of the season, most of which went to Germany and Italy. Some subsequent
exports also have been made.

It appears quite possible for France to enter the new crop
year with about a normal carryover. Because of the decline in consumption,
domestic production plus North African supplies should nearly equal the
total disappearance. With a crop of 279 million bushels and arrivals from
northern Africa amounting to possibly 18 million bushels, it is likely
that the National Wheat Board will hold imports to very low levels. Thus,
unless damaging weather ensues from now on, it is to be expected that France
will not be a very significant factor in world trade during 1937-38. Algeria
will have grain for shipment to France, but just how much will be exported
depends in part upon the Governrent's action in reconstituting stocks which
were partially depleted during the present spring. If stocks are not
rebuilt to a relatively large extent in Algeria, there should remain avail-
able for export to France approximately 7 million bushels of wheat, though
in view of the various substitutions that. can be made this figure is sub-
ject to change. The crop in Tunisia looks so favorable that heivy ship-
ments are expected. While preliminary in nature, it is expected that
exports of new crop bread wheat' m-y reach 5 million bushels during the year,
with durum amounting to 4u million bushels or nore. This supply as usual
will also go to France.
2/ Estimates and information concerning Europe largely from the European
offices of the Bureau.
3/ Danubian countries, Poland, Czechoslovakia, and Soviet Russia.


WS-9





WS-9


Consumptive requirements in Italy have been changing during recent
years, and just: what they may be during the 1937-38 season is difficult
to forecast. It appears, however, that the total disappearance indicated
at present is around 275 million bushels. .With old crop stocks below
normal and with a crop of 265 million bushels, Italy would require,
statistically, at least an additional 10 to 15 million bushels for domestic
utilization. The exact amount will, of course, depend -on the crop outturn
and upon official policy. Because of foreign exchange difficulties, it
is to .be expected that imports will be held to a minimum amount, although
if wheat prices and available foreign exchange supplies are such as to
permit rebuilding year-end stocks toward their normal position, some
increase in stocks and imports would appear most desirable. Since it seems
that the 'reported purchases of :foreign grain this year have been heavier
than required by the usual needs, some recovery i.n the stocks situation
has probably occurred already. Figures on Italian imports do not include
purchases of bread wheat to be milled in bond for the provisioning of
Italyls colonies. Takings of foreign wheat by Italy this year will be
confined, as during the past year, almost entirely to bread wheat.

During the coming year Belgium will probably import about the same
amount of wheat as in the past season, or perhaps slightly less, since
stocks have increased a little toward a normal seasonal carryover. Total
imports may, therefore, be in the neighborhood of 40 million bushels.

In Spain, it seems apparent that there will be sufficient supplies
of.grain.for the territory under the control .of the Burgos Government, but
that heavy imports by the Valencia Government will be necessary. For
Portugal .there ,should be no necessity for importing foreign wheat except
that which comes in under a special arrangement for their Island possessions.
Total supplies.in Portugal.will not be.burdensome and no exports are looked
for, as the extra amount over consumptive requirements will go into an
increased stock position for the.following year.

No countries have announced an intention to accumulate '!extra"
reserves of wheat, with the possible exception of the United Kingdom and
Czechoslovakia. In the United Kingdom there has been no new announcement,
but there are remote possibilities in the Food Defense plans, which still
appear to be only in the blue-print stage. In Czechoslovakia, on the other
hand, it is indicated that most of the remaining wheat stocks may be used
as a reserve. While no specific mention of wheat is made, it is of some
importance to note that the Polish Government is reported to have decided
to accumulate some reserves of rye and oats, and the Australian Government
is indicated to be favoring-some accumulation of "grain" reserves. In
Switzerland similar ideas have been expressed.

Foreign wheat prices 4/

Liverpool and Winnipeg prices have advanced sharply since the middle
of June to the highest levels since 1928, on account of rapid deterioration
in the Canadian crop prospects because of drought, threatened rust damage in
the United States, prospects of a small European wheat harvest, and an in-
creasing concern among European millers relative to the supply of hard
milling wheats. For the week ended July,10 the October future at Liverpool
averaged $141 cQmpared with $1.23 for the week.ended June 19, while at
4/ Domestic prices are discussed on page 19.


-- 9 -




WS-9


Winnipeg it averaged $1.38 and $1.15 for. the same 2 weeks, respectively.
Deterioration of the crop in Canc.da was reflected in the greater advance in
prices at Winnipeg than at Liverpool. For tne week ended June 19 the October
future at Winnipeg was 8- cents lower than the same future at Liverpool, and
by the week ended July 1C it was only 2_ cents lower than at Liverpool.
Prices at Buenos Aires r-emain above an export basis to Europe as a result of
limited remaining wheat supplies. Table 3 shows prices of futures at Liver-
pool, Wihnnipeg, and Buenos Aires, together with prices at Chicago, Kansas
City and Minneapolis by months, January to June, and by weeks since June 1.

Table 3.-Average closing prices of September 1/ wheat futures,
specified markets and dates, 1936 and 1937

: Winnlieg : Liverpool : Buenos :
Date : pf 21 : Aires Chicago .Kansas City Xinrncrpolis
: 1936: 1937: 1936: 1937: 1936: 1937: 1936: 1937: 1936: 1937: 1936: 1937
:Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents


-.-- 87.9 111.0


91.6
87.4
87.0


135.9
132.4
130.3
125.3


88.5 112.5
87.6 119.2
--- --- 86.7 119.3
--- --- 85.0 116.7
89.6 111.5


84.7.107.1


85.6
84.2
84.6
80.9
85.3


108.6
114.9
115.5
113.4
118.4


93.7 117.0
92.4 118.8
90.7 125.2
89.0 125.0
87.0 121.4
98.0 120.3


Week
ended- :
June 5 :

12:

19:


78.0 112.4

77.5 110.7


80.2 114.8


26: 83.0 122.0

July 3: 83.5 134.4

10: 91.3 138.1

High 4/ : 91.3 138.1

Low 4/ : 76.0 106.2


3/
84,0 123.6 90.8 --- 85.2 109.8
3/
84.7 120.2 91.2 --- 85.5 108.2
3/ 3/
88.0 123.4 91.8 110.1 90.7 108.8
3/
90.2 127.8 91.9 114.4 95.4 114.4

90.3 138.6 92.8 124.5 97.9 123.4

98.4 140.6 96.2 122.5 106.3 124.6
5/ 3/
98.4 140.6 96.2 124.5 106.3 124.9
5/ 3/
83.1 120.2 90.1 110.1 83.9 108.2


80.2 106.7 90.3 115.7

80.2 105.4 91.2 114.3

86.9 105.4 100.4 117.6

92.2 111.4 107.1 126.4

93.7 119.2 110.7 135.8

103.5 120.0 121.0 139.6

103.5 120.7 121.0 139.6

79.4 104.4 85.8 114.3


I/ October futures for Winnipeg and Liverpool.
2/ Conversions at noon buying rate of exchange.
3/ August futures.
January 1 to date; Buenos Aires, June to date.
5/ August and September futures.

THE DOMESTIC WHEAT SITUATION
BACKGR0QUnD.- 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, however, reduced stocks.to 138 million.
bushels by July 1, 1936. Stocks on July 1, 1937, have been
forecast at about 90 million bushels.


- 10 -


Montn-
Jan.
Feb.
Mar.
Apr.
May
June


87.1L
84.6
84.5
82.5
78.5
79.7


108.7
111.0
120.3
121.3
119.5
117.3,





TS-9


- 11 -


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 low yields per acre. During 1936-37 both
world and domestic prices advanced sharply as a result
of increased demand and the smallest supplies in recent
years.

The acreage seeded to wheat'for harvest in 1919
was the largest on record up to that time. For the 1919
to 1924 crops, seeded acreage declined from 77 million
to.56 million acres. Then it rose to 71 million acres in
1928 and during the 1928-32 period averaged 67 million
acres. For the 1934 crop seeded acreage was brought down
to 64 million acres. The acreage seeded for harvest this
year increased to 81 million acres, the largest area
.seeded in the history of the country.

Domestic wheat prospects

The production of what in the United States was indicated by the
July 1 condition to be 882 million bushels. This is considerably more than
the 626 million bush-ls produced in 1936 and the average of 583 million
bushels for the past 4 years, when adverse weather conditions greatly re-
duced yields per acre. Estimated yields of 10.9 bushels per seeded acre
this year are again below the 15-year (1922-36) average of 11.7, but with
the largest seeded acreage in the history of the United States, the July esti-
mate is only 17 million bushels greater than the average of 865 million
bushels for the 5 years 1928-32.

Winter --(cat production was indicated at 664 million bushels compared
with 519 million bushels in 1936, and the 5-year (192S-32) average of 623
million bushels. Spring wheat production was indicated at 218 million
bushels, which represents a sharp increase over the 107 million bushels
produced in 1936, but is still well below the 5-y.ear average of 241 million
bushels. Excessive heat during July has hastened the maturity of the spring
wheat crop. However, there has been some spread of rust on susceptible
varieties. Reports of heavy rust damage in Marquis, Ceres, and Reward wheat
varieties in the Red River Valley of western Minnesota and eastern North
Dakota have been verified by Department observers. Only. a trace of rust
has appeared on durum wheat so far and Thatcher, a variety of high quality
hard red spring wheat, is provirL highly resistant to forms of rust present
this year. In interpreting ,-ield from the July condition figures, the
Board made allb-ance for probable losses from rust, as indicated by a study
of the relationship between the July condition and the final outturn in
other years -hen growing conditions and the presence-of rust were comparable
with this year.

Stocks of old --heat in the United States 5/ as of July 1 are still
considered to be about 90 million bushels. This figure is made up of

5/ July 1 stocks in various positions since 1922 are shown in the May issue
of "The Wheat Situation" on page 15.




WS-9


stocks on farms, in countryr elevators and mills, in cities (commercial
stocks) and in merchant mills and el-rvators. Stocks of old wheat on farms
July 1, 1937, were estimat,-d at 22 million bushcls and in cities at 16
million bushels, making a total for these two items of 39 million bushels
compared with 43 million bushels i.n 1936 and 54 million bushels in 1935.
Estimates of stocks in country elevators and mills, an.' in merchant mills
and elevators, -ill not be available until later this month. The stocks
figures as publishAd by ti v Cron Reporting Board for country elevators and
mills -rill include onl-y old -iieat, but those for merchant mills and ele-
vators, as published b the: Burea.- of the Census, -7ill include considerable
new wheat this year, ano. it -ill be necessar-, to ma;:e allo-Gances for such
wheat; this allo-wance -.:ill be maLd.e in the Augist issue of "The Wheat Situa-
tion". Mill stocks -ere s': reduced at th,; timc of the new harvest, which
was earlier than usual this year, that most, of the earlymnrket receipts of
new --heat have been taken directly by mills.

An analysis of prospective --heat supplies and distribution by classes
for 1937-38, on the basis '.f a tentative distribution of 90 million bushels
of old crop stocks and the July 1 indicated production by classes, indicates
that supplies of hard red spring and durum wheat are ample to take care of
the probable prospective requirements, and that there -ill be surplus sup-
plies of hard and soft red winter and white wheats cver domestic requirements.

Table 4.- Estimated prospective -heat supplies and distribution
by classes for 1977-39

: Hard : Soft : Hard :
Item : Red : Red : Red : Durum: White : Total
: Winter: Winter: Spring: ::_
:,iilli c.n Million Million MIillion i,.illion Million
:bushels bu3hels bushels bashels bushels bushels

July 1, 1937 stocks ..........: 49 17 10 6 S 90
Production I/ ................: .51 258 1 l 31 107 882
Total ................... : 400 275 145 37 115 972
Prospective utilization ......: 295 180 115 30 50 670
10o 95 30 7 65 302
"Normal" carryover ............ 50 20 TO 7 l- 125
Surplus available for export
or addition to normal carry-
over ......................... 52 75 0 0 50 177

lj Indicated July 1.

Table 4 shows the forecasted proF -,ctive utilization by classes in
addition to the estimated supply made up of the tentative July 1 carryover and
indicated production. Utilization figures based on disappearance since 1928
arum presented as an indication of utilization. The actual utilization by classes
will deptend, of course, on a number of factors, two of -hich are the relative
prices of the different classes of wheat, and the price of wheat relative to
feed grain prices and supplies in the various sections of the country, especially
during the period prior to the harvesting of the new corn crop. Assuming a
normal carryover by classes, indications point to a surplus available for expert
or for addition to the normal carryover at the end of the year ",f about 50
million bushels each of hard red winter and white wheats and about 75 million
bushels of soft red -inter -hcat.


- 12 -




WS-9


- 13 -


United States, hard red winter heat is a "strong" bread flour wheat
and can be substituted by millers in importing countries for short Canadian
and Argentine supplies of the same type. As a result it is to be expected
that inmorting countries will take all the hard. red winter wheat they can
obtain from us this year. Moreover, because of small world. wheat supplies
in prospect, it is like-ly that more than the usualwdemand forssoft heats
rine" be exTected. It is .doubtful, ho-ever, that 'as much of the soft red
w-inter and white w-heat as shown in table 3 as available for export .ill be
exported. Most of the wheat produced in Europe and Australia consists of
soft varieties, and "strong" heats such as produced in Canada, Argentina
a:id the southwestern United States are needed to produce a high quality
bread flour..

During the .10-ear period from 1921-22 to 1930-31, exports of hard
red heats averaged 67 million bushels an4. reached a 1921-36 maximum of
143 million bushels in 1924-25, while exports of soft red winter averaged
only 13 million bushels for the 10-year period with a maximum of 31 million
bushels in 1926-27. Table 5 shows separate exports for these 2 periods of
hard red winter and hard red spring, and also export figures for white
wheat. Most of the hard red and soft red winter wheat is exported from
Gulf and Atlantic ports, with the Pacifib iTorthwest averaging only 4 per-
cent of the hard red winter and 20 percent of the soft red winter wheat ex-
ports for the 10-year (1921-22 to 1930-31) period.

-Table 5.- Wheat exports by classes, excluding d.urum,,.O-year..
S average and 1921-36 maximum

: Hard red wheats : Soft :
Item : : :, red : Wite
SWinter Spring : Total nter
Si : Million Million Milli'dn Million Million
.bushels bushels "bushels bdshels bushels'

10-year average (1921-22'to
1930-31) 59 67 13 20
Largest, exports since 1920 121 22 143. 31- 30
(1924-25) (1924-25) '(1924-25) (1926-27) (i,927-28)


Total .supplies of, white wheat,, the type produced largely in the Pacific
Northwest, are expected to be about 115 million bushels, compared. with 105
million bushels, the 8-year (1929-36). overage for which years, estimates: are
available. Accordingly, the Pacific Northwest may be expected to have its
u.sual excess, over local requirements. Inasmuch as the United.. States will be
a net exporter of --.heat in .937-39, however, prices in the 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 was the case in the past 3
years. As pointed out in the June issue of "The Thcat Situation", about the
same quantity of flour may be expected to be shipped to Easter.i 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-
year period from 1922-23 to 1931-32.




- l4 -


Domestic wheat prices

Wheat *rices in domestic futures markets, inluenced by the same fac-
tors as prices in Liverpool 6/, rose sharply after the. middle of June, but
were checked during the wec-k endod July 10, when market receipts of winter
wheat were the heaviest since 1931. Table 3 shows futures prices at Chicago,
Kansas City, and Minneapolis.

Cash prices in domestic winter wheat markets declined in the latter
part of June owing to heavy receipts and further adjustment to an export
basis, but recovered about all o- the loss by early July as the result of the
sharply advanced futures market. Cash prices in Minneapolis averaged higher
in early July than during the last half of the month, reflecting the concern
over rust in the domestic spring wheat area and the drought in Canada. Table
6 shows cash prices in important domestic markets, and table 7 gives the price
spreads betwe-n domestic wheat prices and prices at Winnipeg and Liverpool.
6/ See "Foreign wheat prices" on page 12.

Table 6.- Weighted average cash price of -'heat, 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:Minneapolls: St. Louis :Seattle 1'
:1936 :1937 :196 :1q17 :lq:6 :Iq7 :lq;6 :lq7 :19b6 :1937 :1936 :1q37


:Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents Cents


Month -
Jan. :106.6
Feb. :107.1
Mar. : 98.1
Apr. : 94.9
May : 90.0
June : 96.1
Crop yr. av.
endedJune: 99.8
Week ended:-
June 5 : 90.6
12 : 90.1
19 : 96.8
26 :1'1.6
July 3 t 99.4
le :1O8g.
High 2/ :108.8
Low 2/ : 87.4


144. 3
138.5
141.6
14s. 8
131.5
123.0


112.6
110..3
105.9
102.3
94.9
96.,5


13.o0
136.5
13S.6
14r..o
132.0
120.8


132.6
131.1
123.9
122.6
113.6
124.1


165.9
159.4
153.1
15;.9
146.3
145.0


119.9 171.3
121.4 170.0
113.8 183.2
105.8' 172.n
106.0 128.4
112.1 122.4


108.7
1090)
107.9
106.7
101.7
95.3


139.6
143.2

143.6
131.9
122.3


121.2 105.1 121.4 126.0 156.9 112.8 146.9 94.9 111.1


123.7
123.3
123.9
124.5
122.4
121.9
149.6
121.9


91.3
89.4
95.7
101.8

111.4
118.0
89.4


127.2
123.4
123.5
119.6
121.3
122.2
144.5
1.19.6


119.5
118.2
123.6
132.5
124.5
139.3
139.3
108.4


139.4
136.3
1414.o
152.2
151.9
156.2
169. S
136.3


103.6
105. 1
115.2
127.6
125.4
142.2
142.2
103.2


117.2
109.9
1C9.0
131.6
14S.1
142.0
206.2
109.9


99.7
95.4
97.4
97.6
96.5
105.8
1.10.9
95.4


125.A
123.1
123.5
119.
128.1
124..5
147.4
119.8


88.9
86.3
s6.4
84.9
so.5
81.0


112.2
114.4
117.9
119.5
115.8
112.5


82.9 107.7


78-3
78. 1
81.5
86.3
81.8
89.6
90.2
78.1


110.)
109.6
112.0
114.8
116.6

122.0
139.5


1/ Weekly average of
2/ January 1 to date.


daily cash quotations, basis No. 1 sacked.





- 15 -


Table 7.- Spreads between domestic wheat prices and prices at
Winnipeg and Liverpool, specified periods, 1934-37
: Futures per bushel :Cash wheat.per bushel
: .Amoaunt Chicago :Amount Kansas City :Amount No. 2 Hd.Winter
Month and year : averaged : averaged :(Kansas City)averaged
above. : above : above__
:Winnipeg :Liverpool:Winniper :Liverpool:No.3 Mani-: parcels
Sept. : Oct. Sept. : Oct... .tba :(Liverpool)
Cents_____________ "n C : (Win nitpeg ):.
: Cents .CentCents Cents Cents .. Cent Cents


May -
1934 ..........
1935 ... .......:

1937 ....... ..:
June
1934 ..........:
1935 ..........:
1936 .......... :
1937 ...........:
a7ek ended July 10
1934 ..........

19356 ..........:
1937 .......... :


15

6
3

16
10
6

11

15
-14


16
13
- 2
-14

20
S4



17
11

-16


7

2
-6


6
9
" 6

12
-1S


1/ Liverpool parcels not available.


Table 8.- Average:'price per bushel


: Kansas. :
: City :

: Cents


Minneapolis:

Cent s


of wheat,


g
9
* -6
-17

12
0
- 2
-17


19
15

-9

22
9
iC
(- 12)


12 14 1
12 21 .
:5 26
-21 -16 __


specified markets and dates, 1937


Winni- : Buefios :Liver- : Great : Bprlin
peg : Aires : pool BriLtain: 6/
Cents Cents Cents Cents Cents
Cents- Cents Cents 'Cents Cents


Jan .......... :
Feb. ........... :
Mar ......... ... :
Apr. ........... :
May ............ .
June ...........:
W A


138.0
136.5
138.6
140.0
132.e
120. &


165.9-
159.4
153.e0
155.9r
146.3.
145.3'


120.2
121.1
130.3
133.0
125.7
119.6


91.3.
99.5
114.2
123.4
122.5
116.5


126.7
124.7
133.C
1143.5
12941.1
129.9


129.3
119.4
"119.1
133.2
130.1
128.3


2.23
2.23
2.23
2.23
2.23


II C3. ll1U39 2.22
June 5 .........: 127.2 139.4 116. 122.1 13.9 130.9 2.22
12 .........: 123.4 136.3 113.2 11.5.- 126.5 130.0 2.22
19 .........: 123.5 144.0 118.0 111.9 127.7 129.0 2.22
26 .........: 119.6 152.2 122.5 116.3 128.8 125.7 2.22
July 3 ....C...: 121.3 151.9 136.4- 126.5 "139.4 125.7
10 ...... : 122.2 156.2 138,7- 124.3 142.63-
Prices are averages of daily prices for the week ending Saturday except as
follows: Berlin prices are Wednesday quotations. Prices at foreign markets are
converted to United States money at. the current, rates of exchange.
1/ No. 2 Hard Winter. 2/ No. 1 Dark Northern Spring../ No. 3 Manitoba Northern.
Near futures. 5/ Home-gro-n- wheat in England and Wales. 6/ Central German
wheat, wholesale trade price free Central German Station.


Date




WS-9 16 -

Table 9.- Durum wheat: Area and production in Morocco, Algeria, and
Tunisia, average 1930-34, annual 1936 and 1937


Country


: 1,000
: acres


Acr


eage Production 1/


: 1936
1,000
acres


1937 z1930-34
1,000 .1,000
acres bushels


: 1936 : 1937
1,000 1,000
bushels bushels


Morocco ..............:
Algeria ...............
Tunisia .......... :
Total ... ............. :


2,179
3,022
1,745
6,946


2,402
3,232
gqo
6,524


2,051
2,812
6,6o6
6,169


20,734
22,594

52,462


18,651

31,5S


10,288
17,637
10,2gg
35,213


From =oort of the Paris office of the Bureau of Agricultural Economics.
1/ Table 11 in "The Wheat Situation" for June 1937 corrected. The original
data, it appears, was converted as if 1,000 tons instead of 1,000 qvintals

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

: :_ Net imports reported
Country : 1935-36 : 1936-37 : July 1 : 195-36 1936-37
: :forccastl1/: to 1935-36 .1936-37


Austria ..............1
Belgium .............. :
Czechoslovakia ....... :
Denmark .............. :
Finland ..............:
France ...............:
Germany ..............:
Greece ... .. ... .....:
Irish Free State .....:
Latvia ...............:
Netherlands ..........:
Norway ...............:
Poland ............... :
Portugal ..............:
Spain ........... .:
Sweden ............... :
Switzerland ..........:
United Kingdom .......:
Total imports of :
above ............:


Italy ................. :
Total imports .....:
Total exports .....i_
Total, net imports :


Million
bushels
7
39
1
9
4
7-

15
15
2/-2
21

2/-8
2/-3

2/-2
17
209


34 ,
7


355
15
31 0


Million
bushels
10
42
2/ -9
8
3
14
26
18
13
1
22

2/ -6
3
6 ,
1
182
206


Apr.
Apr.
May
May
Apr.
Mar.
May
Apr.
May
Apr.
May
May
May
Apr.
June
May
May
May


30
30
31
31
30
31
31
30
31
..30
31
31
31
30
30
31
31
1


Million
bushels
6
32


3
6

11
l4
2/-2
19
7
21 -7
2/-1


185 -2
185


Million
bushels

34
2/ -9
6
3
5
12
18
13
1
23
8
2/ -6
4/

1 -(
17
183


399
R1


450
1 r


2Ob
12


294


435


328
15


313


Compiled from official sources, except as otherwise stated.
_/ Eased largely on estimates of the Foreign offices of the Bureau of Agri-
cultural Economics.
2/ Net exports. 3/ Less than 50(@,000 bushels. 4/ Net exports of less than
500,000 bushels.


D


I


. 2 12





- 17 -


Table 11.- Mo:veent of wheat, including flour, from princi-al exnortinr
countries, 1.933-34 to 1936-37

_: _Exports as given by official sources :
Country : Total : July 1 to date shown : Date
; l933-34: 1934-35: 1935-36:193'4-35:1935-36:1936-37.:_
: 1,000 1,000 1,000 1,0f0 1,000 .1,000
:bushels bushelp bushels bushels bushels bushels


United. States .......: 37,002
Canada ............. :198,555
Argentina ...........: 144,854


Australia ........:
Russia ........
Hungary ..............
Yugoslavia.......
Rumani a ............
Bulgaria ...........:
Eritish India .....
,Total ...... .:


86,509
33,787
29,6-15
859
248
4,236
2,084
597.729


21, 532
169,631
187,000
108,010
4,286
12, 99
4,h4ol
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-
,90,800


2
16



S1


0,337 .14,829-
1,202 2C9,747
'7,000 76,577
3,012 88,168
3,918 28,816
L,055 11,059
4,117 156
239 9,996
,7 954
1,627- 1,59


.19,362 May 31
199,093 May 31
162,055 June 30
73,7s1 Apr. 30
3,729 Apr. 30
24,958 Apr. 30
S14,269 Apr. 30
5,042 Apr. 33
5,873 kpr. 30
_ll947 Feb. 28


: Shipments as given by trade sources
: Total .:. Week ended (1937)
: 1934-35 : 1935-36 : June 26 : Jul2y 3 July 10
: 1,000 1,000 1,000 1,000 1,000
: bushels bushels bushels bushels bushels


ITorth American *1/...:
Canada, 4 markets 2__/:
United States ......
Argentina ..........:.
Australia ..........:.
Russia .............. :
Danube & Bulgaria 3/:"
British India ......: 4/
Total 5/ .....
Total European .ship-:
ments l/ .........:
Total ex-European :
shipments l/ .....:


162 i$32
176,0 59
20,997
-186,228,
111,628
1,672,
,4,104
'2, 18
49g 79p


219',688
246,199
14,207
77,384-
110,060
30,22)4
98,216
/7 2,529


2,920
1,645
373
.-. 816
1,872
0
376
1,c64


4,024 1,259
1,314 956
374 243
1,084 67T
2,168 1,120
0 3
800 120
816 1,008


Wh1g i_


887.752 355,032


147,938


133,528


'5,536


1,912


1/ Broomhall's Corn Trade News.
2/ Fort William, Port Arthur, Vancouver, Prince
3 Black Sea shipments only.
SOfficial.


Rupert, and New Westminster.


51 Total of trade figures includes North America as reported by Broomhall's,
but does not include items 2 and 3.


997.79 35,3





WS-9


Table 12.- Shipments of' wheat, including. flour f-om principal exporting
countries, spee-ifieddates, 1935-36 and 1936-37

: Areentina Australia Danube North America
Date : :* :
:1935-36: 1936-37: 1935-36:1936-37:1935-36: 1q3-37:1935-36:1936-37
: 1,0r0 1,000 1,9O0 1,000 ,o00 1,000 1,000 1,000
:bushlIs bushels bushels bushels bushels bushels bushels bushels


July May
.-Week ended
June 5
12
1q
t. 26
July 3
10


: 73,500 157,322 10,go00o' 93,6o4'

:1,456 2,720 1,540' 3,0 g
: 90 1,180 1,264' 2,2g4
1: 1,556 1, g64 2,105
: 1.300 816 592 1, 872
928 1,084 516 2 ,16
: 56 670 8d 1, 120


8,16s 61,992 191,912 207,558


0
0
4g
96
168


904
*q6"S

376
Goo
12'0


6, oo
6,9-12
h,'856
5,0 6
5.,32S
5,360


3,016
4,ogo
4,,3*
2,920
4,024
2,513


Compiled from Broomhall's Corn Trade News.


Table 13.- Exports of wheat and heat flour f-om
1935-36 and 1936-37 VJ


the United States,


Date


Wheat : Wheat flour : Wheat
: : including flour
1935-36 : 1936-37 : .1935-36 : 1936-37: 195-36 : 1936-37
1,000 '1,0UO0 1,6 37 1,r OO 1,000 1,000
bushels '. bushels barrels barrels bushels bushels


July May
Week ended
June 5
12
19
26
July 3
-10


: 285


2,39Z

81
512
15
220
271
51


3,035


3,609


35:
39
24
32_
22
41


.14, ,29

?5
169
136
17S
123
122


Compiled from reports of the Denartment of Commerce.
I/ Includes flour milled in bond from foreign wheat.


19,362

245
695
128
370
374
243


- 18 -





- 19 -


Table 14.-World supply and distribution, excluding Soviet Russia and
China, and prices of British Parcles and United States price
to growers, 1927-28 to date


S:Ne : : :British:U.S. : British
:Estimated: :exports:Esti- :Esti- :Appar-:Parcels:average: Parcels
Year : carry- : Pro- : from :mated :mated : ent :average:price : minus
begin- : in :ductionSo6viet total :carry-:disap-:-price : per : U.S.
ning : stocks : / :Russia :supply: out :pear- : per- :bushel : price
July 1 : 1/ : :stocks: ance :bushel : to : to
: : : / : : 2/ :growers: growers
: : :: 3/ :
: il. Mil. -Mil. Mil. Mil. Mil.
: bush. bush. bush. bush. bush. bush. Cents Cents Cents

1927-28: 687 3,673 5 4,365 753 3,612 153.7 122.3 31.4
1928-29: 753 3,996 --- 4,749 *1,027 3,722 128.9 98.8 30.1
1929-30: 1,027 3,584 7 4,618 943 3,675 130.8 101.'5 29.3
1930-31: 943 3,847 112 4,902 1,055 3,847 79.6 62.4 17.2
1931-32: 1,055 3,865 70 4,990 1,041 3,949 59.4 41.4 18.3
1932-33: 1,041 3,863 17 4,921 1,142 3,779 53.8 39.4 14.4
1933-34: 1,142 3,837 34 5,:013 1,167 3,846 69.1 72.0 2.9
1934-35: 1,167 3,527 2 4,696 922 3,774 80.0 87.2 7.2
1935-36: 922 3,571 29 4,522 762 3,760 88.5 86.1 2.4
1936-37: 762 3,530 .-- 14,292 4/515 4/3,777 4/125.5 113.1 4/12.4




1/ Excludes production and stocks in Soviet Russia and China.
2/ Converted at current rates of exchange.
3/ Simple average of 12 monthly prices.
4/ Tentative estimate.


WS-9




WS-9 20 -


THE RYE SITUATION


BACKGROIUD Rye production in the United States be-
fore the War about equaled domestic utilization. During
the War, acreage was increased and large exports followed.
In 1933, 1934 and 1936, production was reduced by drought
conditions to less than the amount normally used in the
United States, and a considerable amount of rye was im-
ported. A large crop in 1935 greatly reduced but did not
eliminate imports. "

The production of rye in the United States was indicated by condition
on July 1 -as 50 million bushels compared with 251 million bushels in 1936 and
the 5-year (1923-32) average of 38 million bushels. The crop in prospect is
large enough to amply provide for domestic requirements in 1937-38 and any
imports will be to satisfy only particular quality requirements. The acreage
of rye for harvest as grain was indicated at 3,960 thousand acres, which, with
the exception of 4,141 thousand acres harvested in 1935, is the largest acreage
since 1923. Nebraska is the only important rye State showing a decreased
acreage.

The increase in acreage this season is widespread and especially large
in the leading rye States of the Northwest. The acreage in North Dakota at
890 thousand acres is double that of l.st year. Rye condition on July 1 at
76.9 percent indicates a yield per acre of 12.7 bushels compared with 9.3
bushels in 1936 and the 10-year'(1923-32) average of 12.0 bushels. Nearly V11
states reported good stands where. fields were not over-grazed and fair to good
yields are expected rather generally.

During June cash rye prices in the United States continued the decline
from an import to a domestic basis, which started in April. No. 2 Rye at
Minneapolis averegod-91.5 cents for the week ended July-3 compared with 116.6
cents for the week ended April 10, 109.7 cents for May 10 and 97.7 cents for
June 10. On July 13 and again on July 16'prices advanced'sharply influenced
principally by strength in wheat.

The weighted average price per bushel of reported cash sales of No. 2
Rye at Minneapolis, monthly since 1915, was given in "The Wheat Situation"for
June, page 18. Insertion of the June average of 99.5 cents and the weighted
average for the 1936-37 year of 97.2 cents brings this table up to date.

In Europe the rye crop outlook is even less favorable than it is for
wheat, and a total harvest below the 1936 level seems probable. Deterioration
in many parts of Central Europe and the Danube Basin continued through June.

In Germany the abandonment of winter rye acreage is estimated to be 5.8
percent compared with a 4.2 percent abandonment last year. On the basis of the
wintorkill and the reduced fall sooedings, a net decrease in the rye acreage of
10 percent now seems probable. The Berlin office of the Bureau estimates a
-probable crop of around 255.9 million bushels, if favorable weather prevails.
This estimate compares with the 1936 crop of 290.8 million bushels. In Poland
the acreage was reduced about 6 percent. This reduction and the less favorable
' 'cTp condition compared with both last year and with the average, indicates a






- 21 -


probable production of 228.3 million bushels compared with 250.5 million
bushels last year. Rye condition in Czechoslovakia remains below average and
below last year, despite some improvement during May. A crop well below
average and not greatly different from the poor harvest of 1936, is now indi-
cated as beii-. around 57.1 million bushels. The crop last year was reported
as 56.5 million bushels.

Gormany, Poland, and Czechoslovakia last year produced 70 percent of
the total European rye crop.




Table 15.- Rye: Acreage, yield, production, supply, indicated
disappearance, net exports, and price 1919-20 to l"'37-2S

: : FPoduction :
-: cre-: Aver- : :Vorld :U.S.as : et :Stocks : Indi-
Year : age : c-c excludet per- :imports:at end : coated : Far1
beginning : har- : yield :United : ing : cent- :includ-: of : disap-: price
July : vest-: pj r :States :Russia: age of: in. : crop : pear- : per
: od : acre : and : world :flo-r : year : ance : bushel
:China : : 1/ : 2/
: 1,000 1,000 Mil. Per- 1,000 1,000 1,0.)0
: acres Bush. bush. bush. cent bush. bush. bush. Cents


1928-32 av.: 3,315


11.5 38,212 96.9


3.9 3/2,686


2,035
4,141
2,757
3,960


8.4
14.2
9.3
12.7


17,070
58,597
25,554
50,398


94.2
97.6
91.3


1.8
6.0
2.8


11, 30
2,236
6/3,752


11,233 71.8
22,299 49,817 39.5
(6,001) (45,604)4/(80.5)
---- ----- ---J


l/ Total imports minus total exports (domestic plus foreign). For the period
1919 to 1928 net exports averaged 30,846,000 bushels annually; pre-war
production about equaled domestic utilization. (1 bbl. of rye flour = 6
bushols of rye.)
2/ Includes stocks on forms as of June 1 (available only beginning with 1935
and only for Juno 1) plus commercial stocks as of July 1.
3/ Net cxpcrts.
4/ Prcli:ainary figure published December 1936.
5/ July 1 indications.
3/ Net imports for 11 months (July-Tlay).


1934-35
1935-36
1936-37
1937-3


55.2


5:
5/ :




UNIVERSITY OF FLORIDA


3 1262 08861 8201








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