The World Wheat Situation, 1931-32 a Review of the Crop Year

THE WORLD WHEAT SITUATION, 1931-32 A REVIEW OF THE CROP YEAR Persisting superabundance of wheat in the 1931-32 was below average and considerably midst of intensified economic depression dom smaller than in the preceding year, in spite of inated the world wheat situation in 1931-32. large shipments to China and Brazil. It did Burdensome wheat stocks heavily concen not fall as low as in 1929-30, when importing trated in visible positions, far-reaching re Europe had bumper crops of cereals and strictions on international trade, and unprece potatoes and large inward carryovers. But dentedly low wheat prices marked the crop Continental Europe imported very moderate year. World wheat disappearance ex-Russia quantities, chiefly for three reasons: 1931 slightly exceeded the high total of the pre domestic wheat crops were generally good, ceding year only because of still more exten though crops of rye, barley, and oats were sive diversion to low-price poor; 1932 crops in im outlets, notably feed use in porting Europe gave excel several countries and food CONTENTS lent promise; and govern use in the Orient. But the PAGE mental measures and finan net reduction in end-year World Wheal Supplies . ..... 64 cial conditions combined stocks was very small. De Governmental Operations and to impose severe restraints veloping prospects for an Regulations .............. 77 upon imports and con other big world crop in Wheat Prices .............. 86 sumption. North America 1932 affected markets and International Trade and Con- contributed only about 40 prices before new wheat sumption ................ 99 per cent of the exports, as was harvested, and disap Appendix Tables ........... 114 compared with 60 per cent pointed hopes that short or more in most years prior crops of winter wheat in to 1929-30; United States the United States and the Danube basin would and Canadian export surpluses were not substantially relieve the surplus condition in pressed out into world markets. Other ex 1932-33. porters except India shipped freely, and Aus World wheat stocks about August 1, 1931, tralia and the Danube basin exported record were 300 to 350 million bushels above normal. quantities. Except from Australia, flour ex The 1931 crop ex-Russia, after numerous up ports were greatly curtailed, and the total in ward revisions of estimates, proved nearly as ternational trade in flour was the smallest in large as in 1930. A bumper crop of winter more than a decade. wheat in the United States largely offset dras The course of international trade was tic reduction of the North American spring broadly similar to that in 1930-31. Heavy wheat crop. Good yields in Australia and Ar shipments from Russia and the Danube basin gentina almost wholly offset large decreases swelled the movement in August-October; big in acreage there. Europe ex-Russia and north exports from Australia and Argentina did the ern Africa had a wheat crop approaching the same in January-March. The December dip bumper post-war outturn of 1929, and larger was exceptionally pronounced. The spring than that of 1930 by almost as much as crops peak was nearly as high as in 1931, as Con in the four chief overseas exporting countries tinental Europe drew upon imports to sup were reduced. Although Russia's crop of 1931 plement depleted domestic supplies. Ship was much smaller than her big crop of 1930, ments declined with unusual severity in May net exports from the USSR were reduced by August, as European importing countries only about 50 million bushels. Hence wheat faced excellent crops with assurance of rigid supplies available to the world ex - Russia restraints upon milling of foreign wheats as nearly equaled the record supplies of 1930-31. soon as new domestic supplies became avail International trade in wheat and flour in able from the crop of 1932. WHEAT STUDIES, Vol. IX, No.3, December 1932 [ 63 ] 64 THE WORLD WHEAT SITUATION, 1931-32 World wheat prices in terms of gold fluc and the fact that the Grain Stabilization Cor tuated on the lowest levels of modern times, poration liquidated a substantial proportion and in terms of commodities in general on of its holdings. A few European importing levels that were probably the lowest in his countries succeeded, by rigorous measures, in tory. Prices sagged to new lows in the early keeping their wheat prices far above levels autumn of 1931. Speculative forces brought prevailing elsewhere. a sharp advance in October-November, but World visible supplies made new high most of the gain was soon lost. Late in the weekly and monthly records until near the crop year, as improved crop prospects coin end of the year. Total end-year stocks ex cided with extreme pessimism over the gen Russia were some 40 million bushels below eral economic outlook, prices declined to the record level of 1931, but were more heav about the low points of the fall of 1931. Prices ily concentrated in North America than ever in the United States, which had been sup before. The surplus carryover in the United ported by stabilization purchases in 1930-31, States exceeded a half-year's food require fell to fresh low levels in 1931-32; yet they ments of this country, and that of Canada were more or less persistently above export exceeded a year's domestic requirements for parity in spite of the huge exportable surplus seed and food. I. WORLD WHEAT SUPPLIES Stocks of old-crop wheat stood at record Russia, world crop ex - Russia, and Russian heights as the crop year opened. World stocks exports was about equal to the record total of ex-Russia about August 1, 1931, according to the year before (Chart 1). Before the end of our revised estimates (Table XXVI), were over 890 million bushels - some 40 million CHART 1.-WORLD WHEAT SUPPLIES, 1921-32* bushels above the previous peak in 1929 and (Billion bushels) about 80 million larger than in 1930. For the 4. 8 4.8 third year in succession they were far above 4. 8 "normal" levels, in 1931 by at least 300 to 350 4.6 4. 4 /1'\. I million bushels. Most of the surplus carry 7 4.4 over was in exporting countries, chiefly North .SUPPlier '\ 4. 2 4.2 America (Chart 11, p. 75). In addition, stocks / must have been fairly large in the USSR and 4. 0 V 4.0 (of import wheat) in and afloat to China, po 3. 8 / \ / Ji\ sitions for which no specific figures can be V \ V ,r-- 3 .8 included. 3. e II \ 3 .6 --- .~crops \ Early in the season it was expected and ex-Russia V 3. 4 hoped that the world wheat crop of 1931 l-- 3 .4 j\ / would fall short of the crop of 1930 by per 3. 2 / 3 .2 haps 200 to 300 million bushels,l and conse ~ \ V 0 3 .0 quently that total supplies would be mate 3'1921 1923 1925 1927 1929 1931 -22 '24 -26 -28 -30 -32 rially less than in the previous year. These * As defined in text. Data in Table XXXIII. expectations were not borne out. In several exporting countries (notably excluding Rus the crop year, moreover, the outlook for end sia) harvests materially exceeded early fore year stocks and the new crops of 1932 indi casts; and as world available supplies are cated that another year of superabundant now appraised, the sum of initial stocks ex- supplies lay immediately ahead. The persist ence of abnormally heavy stocks and the con tinued recurrence of huge world supplies 1 See World Wheat Prospects, .July 23 and Septem ber 3, 1931, and WHEAT STUDIES, September 1931, VII, were dominant factors in the crop year under 509-12. review. WORLD WHEAT SUPPLIES 65 Soft wheats were exceptionally abundant in Had the crop been 200 to 300 million bushels the world crop of 1931, with large crops of smaller, as was anticipated in the summer of soft red winter in the United States, soft 1931, it would have fallen well below the line white wheat in Australia, and the soft wheats of trend, and the world wheat surplus would commonly grown in Europe. But in spite of have been substantially reduced. short crops of spring wheat in North America, World wheat acreage ex-Russia in 1931 was hard bread wheats were also in ample supply, equal to the 1926-30 average but 9.4 million from big carryovers in North America, a acres less than the record total of 1930 (Chart bumper crop of hard red winter in the United 3). Heavy abandonment of spring-wheat acre- States, and substantial exports from Russia. Durum production, however, was the smallest CHART 3.-WORLD WHEAT ACREAGE AND YIELD PER for several years;l the United States crop was ACRE, Ex-RUSSIA, 1921-31* very short, Canada's small, and northern (Million acres; bushels per acre) Africa's somewhat below average; Italy alone 250 250 ACREAGE among the leading producers ex-Russia had a 240 ./ 240 good crop, importing much less durum than ./V 230 " -- 230 usua1.2 220 I /' 220 The world wheat crop of 1931 is shown in V .......... longer perspective in Chart 2, exclusive of 210 -- 210 200 200 China and a few minor producers for which 17 17 comparable data are lacking. Whether Rus YIELD PER ACRE 16 1 16 sia be included or excluded, the crop was a 15 / \. ".. VI\ big one, exceeded by those of 1928 and 1930 V '\V I \ V 15 14 - 14 CHAIIT 2.-WORLD WHEAT PRODUCTION, 1900-1931* 13 I 13 1921 1923 1925 1927 1929 1931 (Billion bushels; logarithmic vertical scale) • See Table I.

Load more