Evening star., 1933-12-03

the announcement OF Govern
ment reports with keen inter-
i est. The speculative people who
have an interest in the market
base their operations, to large extent,
upon the official announcements that
come from Washington. Before sun
rise on the mornings of the official re-
ports, guards surround the Government
buildings where crop staticians are en-
gagged In compiling these data. At a
fixed time the Secretary Of Agriculture
enters the large room to sign the re-
port. A sentry closes and locks the
door.
A few minutes before II o'clock the
group emerges. Guards accompany
them to another room where newsmen
have phones opened to their ofnces.
telegraph instruments signal the ex-
changes that the report is about to be
released. Exactly at IL o'clock the
chairman of the CropReporting Board
shouts Go" Reporters run to their
telephones, telegraph operators pound
their keys. The cotton world knows
what the Government Arop eStimators
and statisticians have found In ther
survey of the current crop.
Recess on the exchanges, which has
been called to await the report, ter
ID ASooAASN-
Many Factors Involved.
The collective activities Of 1000, 600
cotton producers are consolidated IN
these reports with scientific precision
and with due allowance for possible
error. Those who buy and sell cotton
are given, by the most accurate
measurements available. the statistics
on the potential supply Of American
cotton.
Many factors influence the price of
cotton. Supply is the most clearly
visible Of these factors; the measure
ment of demand from one year to the
next belongs, to large extent. In the
field of conjecture. Since 1929 the
decline in demand for cotton has been
a primary factor in the low prices. But
the accumulation of the excessive sup
Div has been so great as to make 1t
virtually impossible to obtain favor
able prices for cotton even with de-
mand on q normal basis. Correcting the
supply situation Is, therefore, doubly
necessary. Improved demand or even
normal consumption of cotton would
not return fair price to the cotton
grower with the tremendous surplus
hanging over the market.
The fluctuating purchasing power,
foreign political upheavals. currency
changes and many other condltlons
contribute to the variation in cotton
prices that come from day to day ana
even from moment to moment.
These factors represent the variables
of demand and there Is little that the
cotton farmer can do to improve them
He can regulate supply and thus In
fluence price.
The control that is in the farmers s
hands Is, obviously, the acreage ne
plants. It is true that the yield from a
given acreage will vary greatly from
year to year. But when taken over a
considerable period there is a direct
and constant relation between the
acreage and the total production:
Year-by-year variations in yield tend
to disappear, and the proauction , aoa .a Is
In spite Of weather, boil Weevlls, or
other factors which the cotton planter
cannot control.
statistical Position" Important.
Therefore the acreage of cotton, as
reported in the Government crop estl-
mates. produces an immediate and
pronounced effect upon the price OF
cotton and, with existing legislation,
voluntary acreage reduction Is the
only method by which necessary sup
ply adjustments can be made.
The statistical position" is a phrase
used innumerable times by the cotton
trade. This statistical position" !"
which varies throughout the year, may
be defined as the current supply OF
American cotton, balanced against the
actual or prospective demand. the
principal factors constituting the
Statistical position" are the current
cotton crop, the carry-over from pre-
vious seasons, and the current demand
or probable future demand. The cot
ton exchanges, barometers of price, re-
fleet with great accuracy this "statis-
tical position" and it is to the improve
ment of this Statistical position" That
the Agricultural Adjustment Admins
tration program for cotton is addressed.
We can not determine in advance
precisely what this statistical position
will be. There are unknowns and vari-
ants In the equation. We may, how
ever, draw from the experience of the
past to reach certain warranted con-
clusions on supply and on the behavior
Of price as influenced by this supply.
A more nearly balanced situation Is
definite prospect for the beginning OF
the crop year 1934-'S5.
Certain events must transpire in order
to restore this balance. The improved
statistical situation which is the Gov
ernment's objective as a measure OF
relief for the hard-pressed cotton
farmer, will depend to large degree
upon the farmer himself. The effec-
tiveness of the 1884 production control
program in actually limiting the amount
80 ooffoy, tho+ will ho rrOHIppH npXt
season is the most important single
factor in reckoning what the cotton
situation will be a year hence. We
know that the cotton farmer cooper
ated this last season, destroyed some
four and a half million bales of poten-
tial production. The program for 1888
was most effective. No one can doubt
that 1t prevented f1ve-cent cotton and
| forestalled grave social and economic
. disturbances in the South.
25,00o,o00 Acres Seen.
There is good reason to assume that
the Government program for restrict.
ing planting next season will be equally
successful Producers will be offered
| adequate inducement to participate In
| the adjustment program and, what Is
even more important, there has beer
developed in the South a strong faith
! in the soundness OF the principles OF
Federal planning for agriculture. High
" individualistic farmers have seen the
results The necessity for continuing
adjustment has been grasped. The first
important money many have seen lr
four years has been convincing. AS
Southern cotton planter. believe thai
| the program for 1884 will be graspeo
| eagerly, enthusiastically
With the prospect of $4,000, ,00C
| planted acres next season-a 40 per cent
reduction from the five-year average
xxitla ac11lal To craa te4