A Crash in Grain?

Are U.S. grain markets hell-bent for calamity? Last week it looked as if they were performing the same speculative shenanigans that preceded cotton's October crash (TIME, Oct. 28).

Prices racked up new records almost, daily. Wheat set the pace. At Chicago, March wheat sprouted up all the way to $2.96 1/2 a bushel, highest since 1917. (Most bakers started passing their higher costs along to consumers by boosting bread prices 1-c- a loaf.) Other grains climbed.

In a month, the long commitments of small wheat traders had jumped from 16.5 million to 23 million bushels. Cried Secretary of Agriculture Clinton Anderson: "Speculation is talking loudly. . . ."

Anderson reminded traders that despite heavy demands from abroad, U.S. wheat and corn supplies are ample, that U.S. crop prospects are excellent. The Commodity Exchange Authority went further. At its request, grain exchanges at Chicago, Minneapolis and Kansas City raised margins on speculative trading (current minimums averaged only about 10%) to 25% of the contract price.

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