Evening star., 1948-10-24
Reports DefIote Buyers Dream
OF Sharply Lower Meat Prices
Wholesale Prices Rising After Slump;
Supply insufficient to Meet Demand
BY the Asseeiosed Press

SNFPiy sHsUttiSsSut
BY the Asseeiatsd Press
CHICAGO, Oct. 23.-Consum-
ers' recent high hopes for much
lower meat prices pronto are
losing their support. Pessimistic
reports are appearing from the
Department of Agriculture, COM
mission firms, the Federal Re-
serve Bank, and others.
Reasons for the reversal make an
interesting study of what besides
food goes into the American market
basket:
A selling wave hit the live hog
market the first few days this
month, the start of the crop year.
Somewhat lower prices splashed
clear over to the retail meat level.
Hopes ballooned. 1t looked little
as If pork chop soon could be
bought at price nearly anybody
could pay.
But since then prices at the live
hog level have taken the high road
and are still going up. So are
wholesale and retail prices.
This defiation of the rosy dream
partly came from something called
orderly marketing"
When farmers suddenly poured
several hundred thousand hogs into
terminal markets early this month,
there was chaos instead of orderli-
ness. The Department of Agricul-
ture said receipts seldom reach such
volume before November. Packing
plants said they were not geared to
handle expanded supplies so early.
AS result prices on live hogs at
Chicago lost as much as 81 hun
dred pounds in three days. And it
wasn't until supplies from the coun-
try were reduced sharply that the
trend turned upward. Since then
more than half the losses have been
recovered, and prices still are climb
ing.
For example, live hog quotations
ended September at q top of $3.50
hundred pounds, dropped to $24.50
by October 5, but now are back up
to $3.50. Wholesale pork loins end
ed September at So to 66 cents q
pound, dropped to so to 56 by Octo-
Der 6, and have resurged to 81 to so
cents q pound.
Chops Drop, Then Rebound.
At the market basket level, center
cut pork chops were 90 cents a
pound as quoted by leading Chicago
chain retailers at the end of Sep
tember, reached a low of 70 cents
October IL, and rebounded to SO
cents for this week ends shopping.
When the bottom appeared to be
dropping out Of the hog market,
farmers and their marketing assc-
Citations said, in effect, now, look,
boys, we've been feeding these hogs
high-priced corn all year. If we
bust the market with a glut like this
we'll 60 bust too. Let's take it easy
SO the market can absorb our sup
plies later on without too much
price cutting"
As in classic economies, so in
meat distributing, it is the inter-
play of supply and demand which
determines prices. Consumer de-
mand for meat remains high and
practically constant. There are more
customers than ever before Popu-
lation has increased greatly. More
people than in any previous period
are receiving pay checks and can
buy meat.
Not Enough to Go Around.
But there isn't enough meat to 60
around at low prices. Supplies this
year are running the lowest since
1910, have run below last year
almost week for week.
The Department of Agriculture re-
ports meat production for the first
eight months was per cent under
q year ago. For September and
October weekly production has been
averaging about per cent lower.
S. A. McMurray Of the commits
sion firm Of Merrill Lynch. Pierce,
Fenner, and Beane predicted this
week that hog slaughter in the cur
rent quarter, October through De-
cember. "is expected to be below
the same three months of last year
by nearly IL to two million head"
The Federal Reserve Bank Of Chi
cago says in q current report that
total production Of meat, whole
sale basis, will approximate q, ,500,-
000, 900 pounds for the current cal
endar year, about 9 per cent less
than 1947." The bank added
however, this was 20 per cent more
than the 1874 average.
Goes to Highest Bidders.
The upshot Of all this Is that the
meat on the market goes to the
highest bidders wherever bidding
takes place. Retracing the route of
pork chop or steak to where