The Minneapolis journal. [volume] (Minneapolis, Minn.) 1888-1939, 1905-12-29
Russia's Wheat Expectation.

The recent report of M. Shlpotf, the
Russian minister of finance, tho cover
ing matters apparently far removed,
has. nevertheless, an indirect bearing
upon commercial Minneapolis. The
price of wheat is as important here and
in the northwest as anything we'll can
be-. The price is affected by numerous
factors, one Of which, and by no means
the least important, is the competition
our surplus has to meet in the world g
markets. This is, indeed, the determin-
ing factor in any longtime calculation,
altho other conditions, as local supply,
high or low quality, or even market
manipulation, may for time control
the range. Russia is a big exporter of
wheat, and what she may do in 1916
will mean much.
M. Shipoff says, in effect, that the
Russian treasury is in no trouble at
all and that no financial d1fHculty
need be feared. He could scarcely be
expected to say anything else. Never
theless, it is surprising how Russia has
maintained herself against enormous
expenditures for war, and later internal
troubles. One reason for her stability
is found in the confidence Of her prin-
cipal hackers. The people Of France
have been told that Russia cannot fail
to pay up finally in any case, and as
interest payments upon all outstanding
obligations have been made regularly,
no panic or serious disturbance has fol-
lowed.
At the end Of 1904 Russia had a sur
plus of 355,OO0,00O gold over and
above the sum necessary to secure her
issues of paper money. With her great
defeats and internal disorders, gold nat
urally began to leave the country. Rus
STA borrowed great quantities, but most
of her foreign purchases of war mate
rial had to be paid for in gold, as also
the interest charges upon her debt. 1t
is clear that, had Russia drawn upon
her gold reserve for interest payments o,
other expenditures requiring gold, she
would long since have exhausted he1
stock; yet the intimation of M. Shipof
is that she still holds very large sun
. intact.
The fact is that Russia upheld her
self by keeping the foreign balance OF
trade in her favor. Eighty per cent OF
all Russia exports is grain or timber
products, and these she has rushed out
Men in the grain trade who calculated
that the Russian troubles would stoI
the exports Of grain never went wider
from the mark, for on the contrary, al
it now appears, the government made
every effort to keep the grain moving
out. Russia raises enough grain to dt
an annual export business Of $15O,0O0,
900. She exported wheat at the rate
of 100000 bushels week for som'
time, and more recently her weekly
Z movement has fallen to about 100000
but this is due largely to the CLOSING
of navigation on the Sea of Azov. B,
keeping the stream flowing her credi
abroad was maintained.
Early in the fall the grain trade wa
I startled by the reports Of great crol
losses in Russian wheat, rye, oats an
barley The total loss was put at owe
500,0O0,000. bushels. Many believe.
tudG tu4S ~ Oesu loSo, IlOIA Cuo IouuCo'
acreage in Russia caused by taking tn
men from the fields into the army, an
subsequent bad weather, would mean
great advance in world IS prices. s.
far they have been wrong. Russia ha
kept the wheat moving out, and price
have not advanced.
Two considerations now arise, as til
year runs out.
IF Russia, to save her credit, is es
porting grain by force, in year o
crop losses, there will be a terrible awaA
ening some day, famine in Russia, grea
falling off in her exports, possibly
ukase prohibiting exports entirely, an
a bull market in wheat. This on tn
supposition that the crop losses wer
not overstated.
The second consideration is the DO.
sibility that the Russian central staff,
teal committee. anticipating the go,
eminent s policy Of forcing grain e,
ports, purposely exaggerated the Ru
sian losses with a view to strengthen
ing the world IS markets, and securin