8 WHEAT PRODUCTION IN NEW ZEALAND 



it is set aside for a few days prior to mixing with the 

 rest of the wheat in that grade, for the purpose of 

 allowing the producer to dispute the inspector's 

 decision. At the end of these few days of grace the 

 wheat is mixed with quantities of the same grade and 

 intimation that it has been received is forwarded by 

 telegraph to the great markets of the States. At the 

 same time the producer is given a receipt for the 

 amount he has delivered at the depot. These official 

 receipts can be readily turned into cash at the local 

 banks, and thus are instruments of credit to the 

 farmer. At the Central wheat markets most sales are 

 made by grades in the absence of actual samples. The 

 great markets of the United States are at Chicago, 

 New York, Minneapolis, Duluth, and Kansas City, 

 where vast quantities of wheat are bought and sold 

 each year. 



Chicago, though not strictly a world's market for 

 wheat as indicated above, is the greatest wheat market 

 in the world, the sales amounting to as much as 

 250,000,000 bushels in a year. The actual wheat 

 received at Chicago is probably about 25,000,000 

 bushels; but the system of dealing in futures is so 

 well developed that the sales amount to about ten 

 times this quantity. 



The term "future" is defined by Emery as a " con- 

 tract for the future delivery of some commodity, 

 without reference to specific lots, made under the 

 rules of some commercial body in a set form, by which 

 the conditions as to the unit of amount, the quality and 

 the time of delivery are stereotyped and only the 

 determination of the total amount and the price is left 

 open to the contracting parties."* 



The different types of speculation which the system 

 of " futures" gives rise to and the influence of these 

 on prices is not strictly relevant to the present discussion, 

 but will be returned to when the factors entering into 

 the determination of price are being discussed. It 



*" Speculation ' ' page 46. 



