Crop Crisis

U. S. farming weather has been so perfect this spring that even green telephone poles around Franklin. Neb., last week sprouted leafy branches. A more alarming manifestation of fertility are bumper crops impending in almost every State. With farm prices already 20% under last year, not since 1932 has the outlook for the U. S. farmer seemed more ominous. Hence, when Washington newshawks waited one afternoon last week for the Department of Agriculture's definitive June 1 estimate of 1938 crops, commodity exchanges all over the U. S. were jittery. The figures that correspondents relayed to their home offices were not quite so bad as most had anticipated--but bad enough to spur Secretary of Agriculture Henry Wallace's efforts to perfect a new wheat-loan program. And such were the prospects for the three major crops (others appeared to be in fairly normal shape) that Secretary Wallace and President Roosevelt prepared to dump the cornucopia of Government largess as never before.

Wheat. In 1915 U. S. farmers harvested 1,008,637,000 bu. of wheat, dumped their surplus into warring Europe, wound up the year with handsome profits. Never before or since has the annual yield topped a billion bushels. Last week's estimates, however, placed the 1938 yield between 1,020,623,000 and 1,045,623,000 bu., on top of a 200,000,000-bu. carryover. Annual U. S. consumption is about half this stupendous total. With light crops in England, Italy and North Africa, there is a slim chance the U. S. may export a sizable share of its surplus. Hope on this score plus rumors of black rust last week jumped prices on the Chicago wheat exchange 4 1/2-c- a bu. day after the report was issued. But at 80-c-, wheat was still 30-c- under last spring and it looked as though only a major crop loss from rust and bad weather or vast New Deal lending could prevent the price from going lower.

Cotton. Although U. S. cotton growers planted only 28,000,000 acres this year, compared with 34,000,000 in 1937, they are expected to harvest a bumper crop of some 13,000,000 bales and already have a carryover of nearly that much. Last fortnight cotton prices slumped to all-time lows, since then have partially recovered-- mainly on rumors of crop-damage from heavy rains in the cotton belt, minor floods in the dust bowl. Last week, spot cotton in New Orleans sold for 8.34-c- a lb. above the price the week before, but well below the 1933-37 level. While 1938 exports are up slightly from last year, U. S. cotton mills have cut production and world consumption for this season is down 13%. In all likelihood cotton growers this summer will need Government help more than ever.

Corn. After last year's huge corn harvest (2,644,995,000 bu.), mid-western farmers were asked to plant 18% fewer acres. Many ignored the request. It is estimated that by fall, last year's surplus will total 300,000,000 bu., 30% above normal. This fact plus prospects of an average 1938 crop last week dropped futures prices on the Chicago Exchange to 57-c- a bu., 60-c- below last year, and prompted Administrator Howard Ross Tolley to predict that a Federal corn loan will be necessary this fall.

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