Evening star., 1935-08-15
A. A. A. LIFTS BARS
AS PRICES MOUNT
Reduction Plan of New Deal
Grain Set-Up Relaxed
10 Per Cent.

New Deal trop reduction had turned
into upward crop adjustment today
as the A. A. A. notified some 60G 600
wheat farmers they may plant S.
200, 900 more acres Of grain in 1886
than was planned two weeks ago.
Alarmingly rapid increase in food
costs led to this unforeseen policy
reversal, which cuts wheat acreage
reduction requirements for signers of
1885 contracts, which will be put
In the mails within a few weeks,
from IS per cent of the basic acre
age to per cent. This modified re-
duction will be made from $4,000, 900
acres potentially productive Of wheat
which the A. A. A. hopes to place
under four-year contracts.
Reports that heat and rust have
cut the 1885 crop estimate to a
total Of only 6O8, ,000,O 900 bushels from
an earlier estimate of $4,000, 900
precipitated the move.
Domestic Supply in Danger.
This step is taken primarily TO
assure domestic consumers of con-
tinued ample wheat supply" Secre-
tary of Agriculture Wallace said, "and
in addition is expected to benefit
farmers by placing this country in
a strengthened condition in the world
export market This is considered
especially important in view of small
er world supplies of wheat"
He said there would not be much
decrease in benefit payments of farm
ers participating in production control
With the Chicago hog price hitting
new high of $3.50 per hundred
weight, it was expected Wallace would
move to increase pork production, too.
However. at his press conference
yesterday the Secretary steadfastIy in
sisted the adjustment program was
keeping the hog price from soaring
higher rather than being the cause for
the present value.
He maintained the reduction pro-
gram conserved the consumption Of
corn, chief feed crop for hogs, and
thus prevented more hogs starving to
death during the drought.
Amendments Counted On.
If the weather in 1896 should play
the A. A. A. false and produce a
bumper crop to depreSs the market.
Adjustment Administration officials
believe adequate powers are contained
in the pending amendments to the
adjustment act to meet any situa-
tion which might arise. The new con-
tract provides that adjustment in
subsequent years may be as much as
Is per cent Of the basic acreage"
At the same time Secretary Wallace
was telling the press of his move, his
Bureau of Agricultural Economics
stated that for the third consecutive
year domestic needs exceed the wheat
crop. The agency announced:
The short crops of the last three
years, together with other influences.
have resulted in wheat prices in the
United States being maintained at
levels unusually high relative to the
world market price.
Wheat Prices Held Up.
Generally speaking, they have
been 20 to 80 cents higher than might
have been expected with more nearly
normal yields in the United States.
With the return of average or greater
than average yields in the United
States in 1886 or later, there would
be an export surplus. and prices would
have to adjust toward an export basis
unless preventative measures we're
taken
Comment of George E Farrell, d.
rector of the Division of Grains OF
the A. A. A, was:
The fact that the Spring wheat
area has suffered severe rust losses
this year makes it advisable to use
the fiexibility Of the agricultural ad-
justment act at this time to provide
for somewhat larger production to
assure adequate supplies of all types
of milling wheat"