The Wheat Rise

If the movement that is under way does not collapse, if it is not based on miscalculation, the farm situation in the U. S. is in a fair way for a complete change.

Wheat prices mounted rapidly last week. Corn prices followed. They reached a point about 30% higher than the week before. If the movement goes on at the same speed with which it has begun, dollar-and-a-half wheat will be a reality in the near future.

The bare facts are these: World wheat production is less than last year --perhaps 10% or 15%. The available supplies of domestic wheat will be about 5% less, according to Department of Agriculture's estimates.

The decrease in world wheat supplies means that the surplus which drugged the international market last year, following a remarkably large crop, will be largely non-existent this year. Prices will be higher and the U. S. farmer will garner the greater part of the advantage because his production is not off as much in proportion as the general world production.

All this depends on the correctness of present estimates. Reports last week were that black rust and weather conditions had cut the Canadian yield from last year's 400 million bushels to 200 or 225 million. Canadians sniffed at these reports. If these estimates are too small, there will probably be a market reaction.

But the fact remains that apparently the world crop will be considerably smaller, that prices will consequently be higher, that it is within the range of possibility that last year's exceedingly bad season for the U. S. wheat-farmer may be followed this year by an equally good season.

Bank failures in the Northwest dropped off 30% in May and another 25% in June. Of the 342 banks which closed during the first six months of the year, already a score, at least, have been reopened by the Agricultural Credit Corporation--the $10,000,000 body organized by private capital last Spring at President Coolidge's request.

The rise of wheat prices, if it continues, or even if it is but sustained, leads to a whole chain of circumstances. It means much better times in the farming region of the Northwest. It means much improvement in banking conditions, because banks will be able to liquidate their frozen farm loans. It may mean the difference between success and failure to the newly-organized, tremendous cooperative grain marketing project of the farmers. It means greater revenues for the Northwestern railroads and their stockholders.

It may turn Senator LaFollette's third ticket plan from a Farmer-Labor combination to a pure Labor movement. The kind of progressivism that the farmers want is that which brings progress in the form of better prices for their grain and livestock. Just at present, it appears as if they would get it without Mr. LaFollette's intervention.