TOO MUCH WHEAT

Evening Post, Volume CXXVI, Issue 77, 28 September 1938, Page 22

TOO MUCH WHEAT

U.S.A. AND CANADA

MARKETING PROBLEM

REQUEST FOR CO-OPERATION

(From "The Post's" Representative.) VANCOUVER, August 30.

Large harvests and small prices are at the foment confounding the^authorities in Canada and the United States. In each country the problem of marketing a substantial export surplus has yet to be solved. Canada has fixed the price at 80 cents a bushel, or 7>V cents less than last year, when the harvest was a little over half the estimated production for 1938. The price today at Winnipeg, for October delivery, is 65 cents. On this day, a year ago, it was nearly double that figure. The Government already is preparing to face a loss of from 40,000,000 to 60,000,000 dollars on its 1938 marketing plan. The situation will be made greatly worse, if, as is rumoured, Canada loses the 6 cents preference in London, to put American wheat on equal marketing terms. In the United States, the situation is more involved. Already the Secretaryof Agriculture, Mr. Wallace, is asking for Canada's co-operation. What form of co-operation is sought is not yet clear. It is known, however, that Mr. Wallace proposes to subsidise the export of 100,000,000 bushels. Experts were sent from Washington to Ottawa to explain the scheme. It is not known yet at what price the U.S.A. will buy wheat from the farmers. It is known, i however, that it will sell its export surplus at competitive world prices, rather than hold it for an improved price, as was done by' the previous Administration. LOST OVERSEAS MARKETS. Briefly, the following figures illustrate the United States's marketing dilemma: — , i Pushels. Estimated crop 96*,000,000 1937 Carry-over , 200,000,000 Total supply 1,167,000,000 Domestic consumption 650,000,000 Surplus 517,000,000 The Government might take over 115,000,000 bushels, as collateral for crop loans, and 50,000,000 bushels for crop insurance and for, feeding the needy. Allowing for 100,000,000 bushels for export, there is a balance of 300,000,000 bushels, to remain in private granaries—a disturbing prospect. To assist farmers already alarmed at the fall in prices the Agricultural Adjustment Administration announced that it would pay subsidies of 26 to 30 cents a bushel, on each farm's normal crop, subject to a guarantee that the farmer will reduce his crop acreage next year. ■* A huge over-production greets the farmer at a time when his countryhas lost its foreign market. Germany, busy with re-armament, instructs its farmers to grow more wheat and its chemists to provide substitutes for other imported foodstuffs. Japan and Italy have cut imports to a minimum, As a consequence the American farmer finds himseilf faced with that overWhelming plenty which has brought him poverty in the past. From 1934 onward the tragedy of the Dust Bowl caused the United States to import wheat. Last year, crop failures in Canada and Argentina enabled export surplus to be disposed of. This year, all the wheat-growing countries have a bumper crop, with a prospective aggregate production of 4,000,000,000 bushels.