"Agricultural Adjustment, 

 Present And Future 



, ;_V (Continued from page 15) 

 percent more money for the hogs. This 

 includes the processing tax on hogs, 

 tactically all of which went to the 

 farmer in the forni of his benefit pay- 

 ments. 



Which would you rather do — as a prac- 

 tical livestock man? Would you rather 

 feed 19 percent more stock and get 9 

 percent less returns — or feed 8 percent 

 less stock and get about 5 percent more 

 returns ? 



These figures, as I motioned, are 

 based on the calendar year of 1934 com- 

 pared with the average of the four pre- 

 ceding years, 1930 to 1933. 



Let us compare 1934 with just one 

 year, 1933, to see if it works out the 

 same way. The following figures are for 

 the first 10 months of 1934 compared to 

 the first 10 months of 1933. I. have taken 

 only the first 10 months of 1933 because 

 the processing tax started on November 

 5, 1933. This gives us a comparison be- 

 tween cattle and hogs during a proces- 

 sing tax period and a non-processing tax 

 period. 



The comparison shows that for the 

 first 10 months of 1934 the cattle 

 slaughter was 14 percent more than for 

 the same ten months in 1933, or 7,765,- 

 000,000 pounds as compared to 6,819,000,- 

 000 pounds, and the money paid by the 

 packers for these cattle was 24 percent 

 more. Twenty-four percent more money 

 for 14 percent more cattle. A small gain, 

 yes — but remember how far down they 

 were. Anyway, look at hogs during the 

 same period. 



Hog slaughter was 11 percent less dur- 

 ing the first 10 months in 1934 than 1933 

 and yet the money paid for these hogs 

 including processing taxes was 47 per- 

 cent more. There is a real gain. The 

 figures are 7,941,000,000 pounds for 1934 

 and 8,910,000,000 pounds for 1933, and 

 $508,206,000 for 1934 and 1346,587,000 

 for 1933. 



In other words while the average cat- 

 tleman was feeding 14 percent more cat- 

 tle his neighbor was feeding 11 percent 

 fewer hogs, both on the same priced com. 

 And yet the packers paid 24 percent more 

 total money for the cattle and 47 percent 

 more money for the hogs. 



Wheat Carryover Normal 



As for agriculture as a whole, the 

 heavy stocks that so depressed the prices 

 two years ago have been reduced, for the 

 most part, to more reasonable levels. The 

 July first carryover of wheat will be just 

 about normal. World stocks of American 

 cotton are still above normal but are 

 greatly reduced from the depressing 

 supplies of two years ago. The drought 

 cut the 1934 com crop so drastically that 

 on November 1 this year the stocks of 



old corn will not exceed 50 to 100 million 

 bushels as compared to 375 million bush- 

 els of two-bit corn in 1933. You know 

 how prices compare with the prices of 

 two years ago, in January, 1933. 



But I want to sound a warning here. 

 In spite of these things I have pointed 

 out, I believe we will agree that the prob- 

 lem is not permanently solved by any 

 means, and that if control were aban- 

 doned, we would not maintain our pres- 

 ent improved position. The surplus threat 

 is dormant in our excess acreage of 

 cultivated ground that has never been 

 put back to grass. The threat is increased 

 by the available capital waiting to be 

 used and by the available man power 

 ready to pounce back upon the soil once 

 it begins to show promise. 



To begin with, we need only from 300 

 to 310 million acres of crop land at av- 

 erage yields to supply our present popu- 

 lation with food and non-food agricul- 

 tural products at the same per capita 

 rate of consumption that prevailed in the 

 comparatively prosperous period from 

 1925 through 1929. Less than 40 million 

 additional acres were required in 1933- 

 34 to supply our exports, and the re- 

 turns from those exports were quite un- 

 favorable. That adds up to from 330 to 

 340 million acres with a favorable do- 

 mestic demand and our present foreign 

 demand. But our actual crop acreage for 

 the past 15 years has .averaged from 360 

 to 370 million acres. It takes just a little 

 job of subtracting to find diat we should 

 keep out of production 20 to 30 million 

 acres of the average land used prior to 

 1933, or else use all of our crop land 

 less intensively unless our exports are 

 increased. 



Must Regain Starkets 



One effort should be directed toward 

 regaining our foreign markets of course. 

 That opens up the whole argument of an 

 effort to permit imports to corresp6nd — 

 to make adjustments in our trade re- 

 striction that will unlock the doors of our 

 foreign buyers. 



I would like to point out in this con- 

 nection, for the information of the Illi- 

 nois hog producers, that a reciprocal tar- 

 iff agreement with Cuba resulted in a 

 lowering of their tariff against our lard 

 on September 3 from $9.59 to $2.27 per 

 hundred pounds. During the first three 

 months following that tariff adjustment 

 our lard exports to Cuba amounted to 

 8,620,000 pounds more than for the same 

 three months the year before. 



That is a big increase in lard export. 

 What does that mean in terms of 225 

 pound hogs to produce it ? What does it 

 mean in terms of com acres at average 

 U. S. yields to produce those hogs? It 

 would take about 253,000 hogs to produce 

 that lard and it would take about 197,000 

 acres of com to produce the hogs. And, 

 remember, this increase in lard ship- 



ments to Cuba occurred during the first 

 3 months after the tariff against our 

 lard was lowered. 



I believe I should also mention that 

 our imports of canned beef from Argen- 

 tina last year were about naif what they 

 were in 1929. Our net impiorts of beef in 

 1934 were less than one-thjrd as large as 

 the net imports in 1929. The amount of 

 net beef imports is inconsequential, any- 

 way, since it amounted last year to less 

 than % of 1 percent of our beef pro- 

 duction. It is of practically no importance 

 except to those whose criticism is based 

 on a desire to criticize instead of on ac- 

 tual facts and conditions. 



Here in the Com Belt, of course, the 

 chief interest centers around feed grain 

 and livestock. The drought coming on top 

 of hog breeding adjustments resulted in 

 livestock population being reduced to or 

 below the most desirable level, even 

 though it is still large in proportion to 

 feed supply. 



i Not Due to Drooth 



The 1934 pig crop was 35 percent 

 smaller th^ that of 1933. Obviously this 

 was not'i^ue to the drouth. A further 

 decrease tn the pig crop of next spring, 

 by some 17 percent, is indicated by the 

 December pig suj-vey. Cattle numbers 

 were reduced around 10 million head. 

 Commercial slaughter was heavier by 

 about 18 percent and government pur- 

 chases totaled more than 8 million head. 

 Sheep numbers also were materially re- 

 duced in the drought areas, with govern- 

 ment purchases totaling about 3,600,000 

 head. 



Thus the requirements for corn have 

 been reduced by 250 to 350 million bush- 

 els from the 1925-1929 level. Because of 

 this reduced com requirement there is a 

 real danger of too much com this coming 

 winter, even with the corn-hog program 

 that is just now getting under way. 

 Without the progrram the danger would 

 be much greater. Historically, following 

 a drought and a short corn crop the tend- 

 ency has been to increase corn produc- 

 tion sharply. That would mean a low 

 price for com and that is bad enough. 

 But this combination of low feed prices 

 and high prices for livestock would re- 

 sult in the beginning of another radical 

 upswing in livestock production next fall. 



I feelsconfident the 1935 corn-hog pro- 

 gram w ill b e a success but for a while 

 longer we will still face the necessity 

 for control of some kind. This does not 

 necessarily mean a program of reduction, 

 but a program of maintaining a balance. 

 What should that program be? 



The farmers who have gone along' 

 with the. present programs to meet the 

 current emergencies point out many 

 things which they don't like and we don't 

 liks about them when we think in terms 

 of a program extending over a period of 

 years. We have sought the opinions of 



FEBRUARY. 1935 



