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TJl(*(>^\^ Cooperative Extension Work in .Agriculture and Hom^ Econcanics 



Qjy^O- ITniversity of Illinois College of Agriculture, Urbana, Illinois, 



^ » fiind U. S. Department of Agriculture cooperating 



WEEKLY REVIEW AND FARM OUTLOOK LETTER 



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By G. L. Jordan 

 Professor, Agricultural Econcmico ' 

 University of Illinois 

 College of Agriculture . 



(Prepared December 2) 



Tuesday, November 30, Marvin Jones, War Food Administrator, and o:f f?cia.le cf 

 the Office of Price Administration and Commodity Credit Corporation met with a group 

 of senators to discuss com ceilings. There was some difference in point of view 

 among the senators, those from Iowa suggesting no change in the ceiling, one from 

 Oklahoma and one from Indiana suggesting that there should "be no ceiling, and others 

 suggest ine ceilings up to $1.28 a bushel, Chicago basis. Senator Lucas, although 

 absent, was reported to favor $1.22 a bushel. Mr. Jones asked for a reaction to the 

 possibility of $l.l6 a bushel and said, "It will be necessary to hare an adjustment 

 upward in the corn price ceiling." 



The ceiling price on com will be raised, but in making this adjustment up- 

 ward, the government should recognize that many farmers have established their live- 

 stock enterprises on the basis of present ceilings on corn. Therefore, support 

 prices should be maintained on livestock at a reasonable level until producers are 

 able to dispose of present holdings at reasonable weights and aieasonable finish. 



Beginning December 1, Illinois farmers who met 90 percent of their war crop 

 goals will be able to obtain corn loans equal to 85 percent of parity price of corn 

 aa of September 15. The United States parity price was $1.06 a bushel on that day. 

 Loan rates in the corn-belt counties are based upon freight differentials from average 

 shipping poln;^s within the area to the terminal markets to which com would normally 

 flow. Loans will be available through June 30, 19Ulf, and will be due October 1, 19^^, 

 but will be callable by the Ccmmodity Credit Corporation at ai^ time prior to that 

 date. 



November 26, the House Ways and Means Committee approved a resolution to 

 suspend for 90 days all duties on importation of wheat, oats, barley, rye, flaxseed, 

 snd hay. This is only a resolution and not a law, but in combination with the possi- 

 bility of a ceiling on oats below current prices, it caused considerable weakness ih 

 the grain market for a few days, 



^ Grain prices depend in a large way upon the demand for livestock and live- 

 stock products and also to scane extent upon the distilling industry. The end of the 

 war will be a signal to most farmers to reduce livestock numbers. The present effortt 

 to reduce livestock numbers ore merely to bring 'them down to a level comparable to our 

 supplies of feed grains. That would still be a very high level compared to prewar 

 averages. A further reduction would be expected at the close of the war. ; 



Cattle price ceilings are delayed until December 15 or the first accounting 

 period following December 15 for each individual packer. However, it should be em- 

 phasized that there are no real ceilings on cattle prices/ Packers may pay higher 

 than the so-called ceiling prices by sacrificing part or all of their subsidy, and may 

 also pay less than $1.00 below the so-called coiling by sacrificing their subsidies. 



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GLJ:RW 



12/2/1.5 , ■ 



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