Hopeless Wheat

Fortnight ago, the wheat markets alternately boiled and froze with rumors. The spring wheat crop in a dozen granger States was almost ready to harvest. It was the season of the private guesstimators, who multiply rainfall by wind damage, divide by brigades of bugs, and sometimes pull figures out of the air, vie with each other in predicting the size of the crop. Meanwhile agents of the U. S. Crop Reporting Board were scouting, sampling and interviewing throughout the wheat belt, getting the cold dope from the farms. Last week, behind locked and guarded doors in Washington, the Board added and weighed these reports, issued the official 1940 crop forecast to a waiting world.

The figure: 204,654,000 bushels of spring wheat. It was 13,000,000 bushels more than last year's, 21000,000 bushels more than the average of the ten years 1929-38, 17,000,000 bushels less than the average guess of the weatherbetting trade.

Also estimated last week was the winter wheat crop, already nearly harvested: 523,990,000 bushels. This was 35,000,000 bushels more than the official winter wheat estimate of a month ago. In Kansas, No. 1 wheat State, 1940 wheat was called the miracle crop; sown during a drought, all but given up for lost, it turned out to be nearly twice as big as the trade anticipated last December. Wheatmen recalled their adage, "Never bury the Kansas wheat crop until it is dead." By last week's end wheat car sidings in greater Kansas City were filling up at the rate of 1.500 cars a day, nearly double the rate of the same week last year. The Oklahoma crop, helped by rain, was 29,000,000 bushels bigger than the Government had forecast in April.

So much good news was, as usual, bad for prices. The forecast publication sent July wheat at Chicago under 73-c- a bushel, a new low since the delivery went on the Board last September. Optimists, who had helped push wheat to $1.13 in April under combined impetus of drought and war, had taken another look at the situation. The chronic U. S. wheat surplus looked even bigger and more unwanted than usual.

In the five idyllic years 1925-29, U. S. wheat farmers sold abroad an average of 170,000,000 bushels a year (20% of the U. S. crop). Even in the year ended in June 1939, when some European countries still bought wheat, the U. S. exported 107,000,000 bushels (even this was largely due to the subsidy). But in the year ended last month. U. S. wheat exports dropped about 50% to around 50,000,000 bushels.

England took 29% of U. S. wheat exports in 1938. But even if the English market were not tightening its belt, it would not be able to bail out the U. S. dust bowl this year. For England is now primarily obliged to buy from Canada (current crop: 430,000,000 bushels) and Australia (210,000,000 bushels), secondarily from Argentina (119,000,000 bushels). Nor can the U. S. try too hard to break these commercial ties. For if the U. S. fights Canada and Argentina for the shrinking European market, they will be less likely to play the game of good neighborliness, Pan-Americanism and Hemisphere Defense.

For weeks, one hope has helped optimists forget the hard and bitter facts: if Britain is defeated the U. S. might become Hitler's No. 1 granary. This hope was based on the supposition that if Hitler does not buy U. S. wheat, Europe faces a famine this winter. But Department of Agriculture experts are not so sure. This week they estimated that the European wheat crop would be only about 10% below normal. They figure that Germany has more than enough food grains to tide her over. Her shortage as usual is in livestock feed crops, which she may offset temporarily by taking Denmark's. By last week, foreign outlets for the U. S. wheat surplus appeared to be disappearing over every horizon.

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