CONFUSION 



IN LIVESTOCK, FEED SITUATION 

 TRACEABLE TO FAILURE TO 

 HEED FARM BUREAU PROGRAM 



By L. H. SIMERL 



Director of Research and Taxation for the lAA 



UNWISE government regulations 

 and market operations, pursued 

 over a period of three years in op- 

 position to Farm Bureau recommenda- 

 tions, have been the primary cause of 

 the congestion of livestock markets and 

 the acute shortage of grains and other 

 feeds in recent months. 



We are now in a most critical Stage 

 of the war. The grain accumulated 

 through the commodity loan program, 

 which was supposed to be saved for 

 use in emergencies, has long since been 

 dissipated. On the other hand, the 

 need for grain and feed is now greater 

 than ever before, and is expected to 

 increase even more. 



Now corn processors have large or- 

 ders for alcohol and other war essen- 

 tials — and little or no corn. Many 

 farmers have partly finished hogs or 

 cattle in the feed lot - — and no feed. 

 Other farmers have already been forced 

 to sell their livestock. 



For three years the Farm Bureau has 

 advocated a policy which would have 

 prevented this unfortunate situation. 

 Let's look at the record. 



When it became apparent, in the 

 summer of 1940, that the American 

 farmers would be called upon to fur- 

 nish food for hungry people in war- 

 torn lands, the lAA urged government 

 officials to recognize the importance of 

 corn in the nation's food program, and 

 to consider the advisability of increas- 

 ing corn acreage allotments for the 

 next year. However, no adjustments 

 were made in the allotments for 1941. 



In the first part of 1941, the United 

 States Department of Agriculture 

 launched a great drive for increased 

 food production. Government officials 

 called for a much larger output of hogs 

 and dairy and poultry products. 



The Illinois Agricultural Associ- 

 ation, realizing that this increased pro- 

 duction would soon deplete reserves, 

 urged government officials to increase 

 1942 corn allotments by at least 15 

 per cent. The Department of Agri- 

 culture, however, announced in Sep- 

 tember that the 1942 corn allotments 

 would be approximately the same as 

 those in 1941. Several months later 

 the 1942 corn acreage allotments were 

 increased by 8 per cent. 



The administration definitely adopted 

 a cheap feed policy beginning in 1941. 



The first step was the sponsoring of 

 legislation which provided for the re- 

 lease for feeding purposes of wheat 

 grown on acres in excess of wheat al- 

 lotments. This was intended to start 

 a rapid use of wheat and corn reserves. 

 It did just that. 



Representatives of the Farm Bu- 

 reaus in the mid-western states, meet- 

 ing at the University of • Illinois in 

 July 1941, unanimously adopted a 

 resolution opposing the release of 

 wheat grown on excess acres for feed- 

 ing purposes. 



In August 1941 the position of the 

 Illinois Agricultural Association was 

 expressed editorially as follows: 



"Prices of corn, wheat and livestock 

 are fast approaching satisfactory levels 

 and the adoption of any amendment 

 to the present law that would throw 

 into abnormal relationship wheat and 

 corn in the feed lot, or would other- 

 wise demoralize relationships or price 

 levels, should be overwhelmingly de- 

 feated." 



During the next several months 

 Earl C. Smith, president of the 

 lAA, warned repeatedly of the 

 dangers in the cheap feed policy 

 which was being followed by the 

 government. Writing in this mag- 

 azine just two years ago he said, 

 "Producers of livestock should 

 not fail to recognize that if feed 

 grains are deliberately held to a 

 price substantially below parity 

 that it will pave the way for com- 

 parable weakening in the support 

 of price levels of their produas 

 when supplies conimence to de- 

 press price levels." 



In June 1942, the American Farm 

 Bureau Federation sent a letter to every 

 member of Congress. In part this let- 

 ter read, "Responding wholeheartedly 

 to the government's plea for increased 

 food production to win the war, farm- 

 ers are producing the greatest supplies 

 of food on record. The increased pro- 

 duction of milk and milk products, 

 for example, has in many areas far ex- 

 ceeded the capacity to absorb the sup- 

 ply; and as a result, milk is being 

 wasted and farmers are suffering heavy 

 losses. A large number of cheese fac- 

 tories in the Middle West and other 

 areas have closed down or have been 



forced to greatly reduce their opera- 

 tions in the last few days and evapo- 

 rated milk outlets have also been cur- 

 tailed because of the government's in- 

 ability to absorb accumulated supplies. 



"We fail to see any consistency in 

 the government's efforts to release feed 

 grains below parity when the supply 

 of the products of feed grains already 

 exists in excess of consumer demands 

 and government's ability to purchase. 

 This inconsistency is particularly true 

 when we remember that the surpluses 

 under control were intended to meet 

 emergencies " 



In July 1942 representatives of the 

 mid-western Farm Bureaus, meeting in 

 Madison, Wisconsin, again expressed 

 their opposition to the sale of wheat 

 at low prices for feed. 



The following month another warn- 

 ing was given editorially in this publi- 

 cation. "Feed grain supplies are being 

 used up far more rapidly than they 

 are being produced. During the six 

 months ending July 1-, about 25 per 

 cent more corn was used than the aver- 

 age amount used during the first six 

 months of the preceding four years. 

 At this rate the total disappearance of 

 corn for the year ending next January 

 1 would be 2.9 to 3.0 billions of bush- 

 els. 



"As compared with these consump- 

 tion figures, the average production of 

 corn during the last five years, all of 

 which have been favorable seasons, 

 has been less than 2.6 billion bushels. 

 On a percentage basis, corn is being 

 used 12 to 15 per cent faster than the 

 average rate of production during the 

 last five years 



"Much attention has been centered 

 on wheat stocks as a reserve of feed. 

 The carryover of wheat on July 1 was 

 about 630 million bushels and the new 

 crop is estimated at 904 million bushels. 



"Of this huge amount, 700 million 

 bushels will be needed for normal 

 domestic uses and 200 million more for 

 normal domestic stocks and reserves. 

 Thus, only some 600 million bushels 

 are available for extraordinary uses 

 such as manufacture into • alcohol and 

 rubber, as a substitute for corn in live 

 stock feed, and as a reserve against crop 

 failure in this country, and for export 

 to starving people in other countries 

 either during or after the war. 





12 



I. A. A. RECORD 



