Evening star., 1947-01-02
Relief Exports Cause
Startling Contrasts
In Grain Market
By WiIIiom Ferris
Associated Press Market Writer


CHICAGO, Jan. 2.-An elemen-
tary cry for bread from starving
people. and the efforts of the Amer
lean Government to meet that cry,
dominated grain markets during
1916.
1t was a year of startling con-
trasts-a flour shortage and record
wheat crop, a corn products shortage
and a record corn crop, an oats
cereal shortage and near record
oats crop. Good intentions battled
with black markets.
Flour disappeared from grocery
shelves. Housewives stood in line to
obtain smaller loaves of bread. Corn
professors closed and manufacturers
of oats cereals ran out of supplies.
City folk realized how much their
food supply depended upon grains.
Stockings for Oats.
There were other weird develop
ments. Buyers had to supply a dozen
pairs of Nylon stockings to get
car Of oats. Corn sold at higher
prices than wheat. Trading in
futures" on the Chicago Board of
Trade was halted by temporary
court injunction Grain was sent to
terminals unprotected in coal cars.
Foremost as market influence
was the desperate need to get grains
overseas to combat famine-a need
which still exists. The Government
is aiming to send at least 100000, 600
bushels of cereals and flour aboard
in the current crop year ending
June 80. Transportation difficulties
and strikes have slowed the move
ment.
This Government demand was i'm
portant in keeping prices pressed
against ceilings, which were badly
dented before their removal in the
fail. Efforts to obtain wheat in
cluded bonus" payments above CELL
ings and a requirement that half of
all wheat sent to elevators for stor-
age had to be sold to the Govern
ment. ...
Consumption Restricted.
Grain use in alcohol manufacture
was stringently restricted. Millers
were ordered to make only dark"
flour, which produced dark" bread.
But large quantities of wheat were
siphoned from both domestic and
export markets by heavy feeding to
livestock a development which,
grain analysts said, resulted from
making the wheat ceiling, too low in
relation to the hog ceiling.
After ceilings we're removed,
there was an immediate squirt in
prices. With the country practically
stripped clean of corn at the tail
end of the marketing season, that
grain advanced to $2.29 a bushel at
Chicago-highest since 1917, when
the price hit $236. Corn is now
down to around $1.40. ...
Wheat, however, has not lost any
of it's gain. 1t is selling in Chicago
now at around $3.50 bushel. This
is the best price since 1920, when the
bread cereal brought $3.50 in the
postwar infiationary boom of that
period. Oats spurted above $1,00,
but are now down to around 80
cents.
These high prices were recorded
in a year when the country pro-
duced 1,155, tbs 900 bushels of wheat,
3,237 1927, 900 bushels of corn and l.
500 ,867 900 bushels of oats. Such a
combination of bumper crops and
high prices was without precedent.
Outlook Favorable.
, Outlook for 1947 is considered rea-
sonably favorable for grains. An
other year of bumper crops is
wanted, and winter wheat is off to
an exceptionally promising start.
The Agriculture Department fore
casts a yield of 946, 6,527,000 bushels
against $780,, 900 bushels harvest
ed this year. Domestic grain re-
serves are expected to be built up
bit.
Prices, 1t is felt, may undergo
some decline, but predictions from
both the Agriculture Department
and private sources do not include
any sharp break. Export demand
again will play a major part in sup
porting quotations, analysts believe.