THE UNPRECEDENTED PRICE OF WHEAT.
FOR the week ended on Saturday last, the official average price of wheat was 35s. id. per quarter. This is the lowest weekly average recorded since official returns have been made. In one week of 1835 the price was as low as 36s. 8d., and for the week ended October 11th, 1851, it was 35s. 6d. These are the nearest approaches to the very low averages of
last week and the week before. It is almost certain that the year's average price for 1884 will be the lowest on record, as it has not been up to 40s. for a single week during the year, -a steadiness at very low prices unique in the history of the wheat trade. For the week ended January 5th, the average price was 39s., which is the highest average for any week in the year, so far ; and from that price to 35s. ld. is the whole range of the weekly averages up to last Saturday. The prices officially recorded are a little lower than those actually realised in the market, because, under the new Corn Returns Act, the weight fixed for a bushel of wheat is 60 lb., and all returns have to be computed on that basis. Now, 60 lb. per bushel is a very fair average weight for English wheat in the generality of seasons ; but it happens that since the new Act has come into operation-that is, since January 1st, 1883- English wheat has been exceptionally heavy, because dry and sound. Last year's wheat was of splendid quality, often weighing from 641b. to 65 lb. per bushel, natural weight; and this year's crop appears to be quite as heavy, the grain being perfectly dry. Now, returns of a number of quarters of wheat sold at, say, 36s. per quarter, the natural weight of the measured bushel being 64 lb., have to be commuted into the equivalent at 60 lb. per bushel, and this, of course, reduces the price. On the other hand, it is to be borne in mind that re-sales, and therefore rail expenses and merchants' profits, are included in the returns ; also that inferior qualities of grain are commonly used on the farm, and so never get included in the corn returns. The official average prices, then, are apt to exceed rather than fall below the average prices actually received by growers.
Turning from official averages to market quotations, we see that London prices for white wheat last Monday were 35s. to 38s., and for red wheat 32s. to 35s. The bulk of the English crop is red wheat, and in country markets good sound grain has been sold at 30s., while excellent wheat, weighing 64 lb. to the bushel, has been "given away," as the sellers thinks at 32s. per quarter. No wonder that the farmers are aghast at such prices. No living man among them has ever before sold sound, dry English wheat at such a price, which is only about half the amount that a few years ago was said to be essential to profitable wheat-cultivation in this country. Lately, farmers have become more modest in their reckonings, and most of them would be glad to grow wheat at 50s. a quarter. At 40s., nine out of ten would declare that wheat-growing cannot possibly pay, while not a single man among them would profess to be able to grow the cereal at 30s. without a heavy loss. Not many farmers have sold at 30s. at present, but we fear that a great many will have to accept that or a lower price before the end of the year, as the world's wheat crop is undoubtedly much in excess of a year's consumption. Our own crop has been estimated by good authorities at about thirty bushels an acre. The area of land under wheat this year was 2,676,477 acres in Great Britain, and 69,008 acres in Ireland. Allowing 5,000 acres for the Isle of Man and the Channel Islands, we get a total of 2,750,485 acres, which, at thirty bushels an acre, would yield 10,314,320 quarters as the gross wheat crop of the United Kingdom. The results of thrashings have disposed some authorities to estimate the average yield at less than 30 bushels per acre ; but the lowest estimate yet published puts the gross crop at 10,000,000 quarters, deducts 1,000,000 quarters for seed and other uses on the farm, and reckons 9,000,000 quarters as the quantity available for human consumption. Upon this reckoning, we should require to import 16,000,000 quarters, to make up the 25,000,000 quarters which represents a year's consumption for the United Kingdom. That is a much smaller quantity than we have imported during the last ten years, when the crops of the great exporting countries were not nearly so good as they are this year. The Report on the harvests of the Northern Hemisphere, just issued by M. Estienne, of Marseilles, represents the wheat crop as good or fair in every exporting country, and so good in most of the other countries that those accustomed to import wheat will require very little, if any, during the cereal year just begun. There will, therefore, be scarcely any competition for the large North-American surplus, the extra produce of the Argentine Republic and Australasia, the accumulated stocks of old wheat in Russia, an Indian surplus quite equal to that of last year, and smaller quantities in other exporting countries, such as Persia, Egypt, and Chili. New York specu- lators talk of holding wheat, but it is an idle delusion. All attempts to "corner" the trade hitherto have conspicuously failed, and there never was so little chance of success as there is this year. Recent rainy weather, both here and in the United States, has checked the downfall in prices temporarily ; but, with fine weather, the home crop, all quite fit to be thrashed, will be poured into the markets, and the downward progress will again go on. At least, in view of all the circum- stances named above, it seems impossible to hold any other ex- pectation. It is said that there is "no bottom to the wheat trade" now ; and it would be difficult to name a price which must be the minimum, unless farmers, here and in the United States, should take to feeding their cattle with wheat on an extensive scale. There is no feeding-stuff so cheap as wheat at 30s. a quarter, weighing thirty-six stones. The same weight of maise would be very little less money, while common cotton-cake is only 5s. per ton less. Unfortunately, the Agricultural Holdings Act does not allow a tenant any claim to compensation for corn of his own growth fed on the farm, and this is a great disadvantage. If farmers take to feeding their live-stock on wheat to a large extent, they will require to go through the farce of selling to each other. With a little care, wheat-meal may be given to all kinds of farm-stock, mixed with chaff and other food.
A few years ago, it was correctly stated that since the repeal of the Corn-laws the average price of wheat had been only about 8s. a quarter less than that of a corresponding period of Protection ; but this is no longer true. At the end of 1883, thirty-seven years had passed since the year of repeal ; leaving the transition year, 1846, out of the reckoning, we find that for the whole of thirty-seven years before it the average price of wheat was 68s. Old. per quarter, while for the thirty-seven years after 1846 the average price was 51s. 51d. During the former period the fluctuation in yearly average prices was from 39s. 4d. to 126s. 6d. ; during the latter, from 38s. 6d. to 72s. 5d. Since 1877 no year's average price has reached 50s., the highest being 46s. 5d., in 1878. The principal cereal is now grown in so many different climates, and harvested at such different periods of the year, that a serious scarcity, such as would produce high prices, is almost beyond the bounds of possibility-at least, for many years to come-supposing the present area of the crop to be maintained.
Up to the present time it has not been a question whether the wheat-area of the world will be maintained, but to what extent it will be increased. It is only re- cently that India and the Argentine Republic have become exporting countries to a large extent. And it has been pro- posed to increase wheat-production in India very largely by making new railways, and charging low rates of transit. The North-West of Canada is another new wheat country, and only the other day we were assured that the resources of Mexico, if properly developed, would enable her to feed half the world with wheat. But how will this rage for wheat-growing be affected if the average price in our own country goes down to 30s. a quarter ? We take it that the ryots of India can grow wheat at a lower price than any other cultivators in the world ; but can they grow it to sell here at 30s. a quarter ? When giving evidence before the Select Committee on Indian Railways in June last, Dr. Hunter stated, as the result of careful inquiries, that the ryots would extend the area of wheat cultivation if they received 1 6s. to 18s. per quarter ; but he went on to point out that 18s. in the interior of India meant 22s. at Jubbulpore and 41s. in London. Now, the quotations for Indian wheat last Monday were 29s. to 36s., and if the average price should go down to 305., they will be 5s. lower. At such prices as are indicated by this possible reduction, we doubt whether the present area of wheat culti- vation in India would be maintained, even if the utmost facilities for transport were afforded. After citing this Indian example, we might, perhaps, leave the discussion of the question, and conclude that wheat cannot be grown anywhere to sell here at 30s. a quarter ; but let us turn for a moment to the United States and our Colonies, and see what evidence can be readily offered with respect to their ability to produce wheat under such conditions. In New York, on Tuesday last, red winter-wheat was selling at 30s. 6d. a quarter, relatively a higher price than was current in London ; but New York prices are almost purely speculative, and no American grower can command anything like 30s. 6d. a quarter for his wheat. A fortnight earlier, when prices were higher, a writer in Bradstreet's (New York) stated that, at the prices fixed by the Minneapolis Milling Association, the farmers of Minnesota and Dacota obtain only "from 52 cents upwards, according to grade," for their wheat ; that is to say, 17s. 4d. a quarter for ordinary wheat, and a little more for the best qualities. At
about the same date, a Kansas farmer stated that in his dis- trict wheat was selling at a price equivalent to 20s. a quarter, and since then a decline of 5s. has taken place here, and probably there also. Now, the average yield of wheat in the three States just named, one year with another, would be less than two quarters an acre. Even at 20s., which would be much more than 30s. in London, can it for a moment be supposed that wheat-growing would be profitable ? The Kansas farmer referred to declared that his neighbours had concluded that they could not grow wheat at the price ; and that, in his own county at any rate, not much more than half last year's area would be sown. According to the Washington Agricultural Department, the acreage of winter- wheat sown last autumn was less than that of the previous year, though more withstood the winter ; and anyone who will take the trouble to compare the prices of any summer with the area of wheat sown in the United States in the following autumn, will find that there has been a very close correspondence between price and proportion of increase in area during the many years of extending wheat-cultivation. Even if prices should not go lower than they are at present it will not be surprising to see a considerable diminution in the wheat acreage of the United States next year. In Australia and New Zealand the question of growing less wheat was under discussion before prices were as low as they are now, and it is likely that a further decline would lead farmers in these colonies to grow only for home consumption.
In the United Kingdom, it is scarcely necessary to state, the cultivation of wheat has been gradually declining for several years, although prices have seldom approached the present low standard. Everyone was surprised at the smallness of the wheat acreage disclosed by the publication of the summary of the Agricultural Returns, the autumn of 1883 having been exceptionally favourable to sowing. As the average price of wheat is 8s. id. less than it was at this time last year, a con- siderable further decline in the acreage may be expected. We cannot now atop to inquire what our farmers will grow instead of wheat, and our object is rather to show that extremely low prices for the current cereal year may prove to be ultimately advantageous to them by checking the ardour of foreign culti- Tators to flood our markets with wheat. Nothing short of what we may term panic prices would suffice for the purpose. That such prices will prevail during the autumn and winter there seems very little room to doubt ; it remains to be seen what the results will be.
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