1 says, to
ands of
four or
efficient
s
iltry
c.
When Will Normalcy Return To Commodities Markets?
Between June 1972 and the
present, wheat has risen from
below $1.50 per bushel to over $4.,
corn from $1.15 to around $3 and
soybeans from $3.35 to $lO per
bushel. Hog prices are up 50 per
cent, broilers 75 per cent and
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livestock levels are up com
parably, although price ceilings
have distorted the picture.
For example, maintaining beef
ceilings and permitting exports
of feed grains to continue to
record rates virtually creates
unprofitable feeding ratios for
domestic producers of all
animals. Despite heavy pressure
from meat industry people and
contrary to USDA policy, these
ceilings will apparently remain
in-tact until September 12.
In the meantime, foreign
consumers of U. S. food and feed
grains are making the heaviest
commitments in history in order
to provide supplies and buffer
stocks to protect their own food
industry
The availability of wheat, for
example, in world markets has
become exceedingly short and
prices are expected to remain
much higher than normal for a
long time. The general surplus
condition in American
agriculture has evaporated and
food prices are rising rapidly
here and abroad. The starting U.
S. wheat supply of more than 1.7
billion bushels has been more
than committed if export sales
have in fact reached 1.1 billion
bushels as officially indicated
and domestic requirements reach
750 million bushels. The July 1,
1973 carryover of 430 million
bushels will be cut to about half
that amount or the smallest
carryover in post World War II
history by July 1974. This almost
assures USDA of having to im
pose export allotments which
probably will result in the cutting
across contract lines and forcing
shippers to cancel sales
previously made. Certainly there
is no room to sell additional
quantities which is a disturbing
item inasmuch as we have on a
regular basis sold wheat under
Food For Peace to India,
Pakistan, Bangladesh and other
food deficit countries.
The Prime Minister of Japan
just toured the U. S. and along
with government leaders from
other lands pleaded with
President Nixon to insure a flow
of food to countries where im
ports are needed. This also
creates a favorable trade
balance, with U. S. shipments of
farm products having reached
almost |1.3 billion during the
fiscal year ended June 30
boosting the nation’s agricultural
trade surplus to a record $5.6
billion. That reflects a gain of $3.6
billion over fiscal 1972.
Again government action will
be needed insofar as restoring
adequate domestic supplies, or
wheat prices according to some
analysts could rise as high as $7-
10. per bushel. Com would tend to
follow and per our above
discussion, animal prices and
feeding ratios would be seriously
Check Presented to AEB
A check in excess of $lO,OOO was
presented this month to the
American Egg Board by
customers of Merck and Com
pany, Inc., Chemical Division.
The program to fund new
promotion activities was initiated
by Merck in 1972. The amount
presented to AEB represents
three cents for each pound
coccidiostat purchased by
Merck’s customers and is being
used by the chemical firm for
national poultry promotion
programs.
The check was presented by
T.T. Tressler, Merck’s Sales
Manager for the North Central
Region, to Richard L. Rathe,
Lancaster Farming, Saturday, August 25,1973
affected
All of this results originally
from a $9OO million sale of farm
products to the Soviet Union last
year, encouraging Western
Europe to take a record $4-%
billion worth of U.S. agricultural
exports, compared with $3 billion
a year earlier, and Japan $2.3
billion for a near 100 per cent
increase. Developing countries in
Asia purchased about 30 per cent
more in fiscal 1973 and the
People’s Republic of China
became a significant customer
taking over $2OO million worth.
Past shortages have proved short
lived, so unprecendented demand
had knocked normal technical
and statistical theories way out of
kilter. It is impossible to predict
when anything resembling
normalcy might be restored.
AEB President, at the Board’s
offices in Park Ridge, 11. The
money represents a quarter
payment of funds designated by
the customers for egg promotion.
These funds will be used for
advertising, merchandising,
consumer education, and market
research activities in the recently
expanded AEB program, Kathe
stated.
“Merck and Company is very
pleased to provide the means for
expanded poultry and egg
promotion programs. Our
customers have indicated their
wholehearted approval of our
joint effort,” concluded Tressler.
21