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Published online by Cambridge University Press: 07 November 2014
Some confusion regarding the present position ot the Canadian wheat economy is inevitable if one reads the newspapers at all. One press report will suggest a temporary lull in the almost monotonous prosperity in which the prairies are said to have basked for the last ten years or more; another suggests blue ruin and a return to the hungry thirties. The Toronto Globe and Mail, viewing the essentially simple economic and social phenomena of the hinterland as from a metropolitan eminence, attempted a compromise some weeks ago in a cartoon showing a horde of embattled western farmers descending on Ottawa demanding justice and parity in a fleet of Cadillacs. Yet the gibe seems a bit unfair at a time when the wheat farmer does not know where his next Cadillac is coming from. All this may suggest that an effort is necessary to find some middle path between the unfailing optimism of the Minister of Trade and Commerce, whose department and board have in their custody and care the disposition and sale of our wheat, on the one hand, and the almost unrelieved pessimism of certain other V.I.P.'s and the Interprovincial Farm Union Council on the other.
If there are problems facing the prairie economy today they can hardly be charged either to reckless expansion of wheat acreage or to improvident gambling on high prices for wheat in the world market. Perhaps it is prairie experience with the heavy human and capital losses of prolonged depression, through the thirties and early forties, which explains why the wheat grower seems to have put so much emphasis on stability in the post-war period.
This paper was presented at the annual meeting of the Royal Society of Canada, Section II, at Toronto, June 6, 1955, at which time the writer was Harold A. Innis Visiting Professor in Political Economy at the University of Toronto.
1 See Canada, House of Commons Debates, vol. 97, 01 20, Jan. 27, Feb. 15, Feb. 18, May 13, May 17, 1955.Google Scholar
2 See MacGibbon, D. A., The Canadian Grain Trade, 1931–1951 (Toronto, 1952), chaps. vii and ix.Google Scholar
3 For a fuller discussion see Britnell, G. E., “Perspective on Change in the Prairie Economy,” this Journal, XIX, no. 4, 11, 1953, 437–54.Google Scholar
4 See United States Dept. of Agriculture, The Wheat Situation, no. 143, 04, 1955, Table 2, p. 20.Google Scholar
5 See Grain Trade Year Book, 1953–54 (Winnipeg: Sanford Evans Statistical Service, 1954), 111.Google Scholar
6 See Dominion Bureau of Statistics, The Wheat Review, 08, 1954, 1.Google Scholar
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8 See Grain Trade Year Book, 1953–54, 31.
9 See statement by Hon.Howe, Right C. D., Minister of Trade and Commerce, in Canada, H. of C. Debates, vol. 97, no. 85, 05 16, 1955, pp. 3781–4.Google Scholar
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11 See The Wheat Review, 01, 1955, 8–11.Google Scholar
12 A mandatory price support for wheat based on 90 per cent of “parity” is in effect at the present time. Parity for wheat is determined by multiplying the base price of 88.4 cents per bushel (average of 60 months from August, 1909 to July, 1914) by the index of prices paid, including interest, taxes, and wage rates (1910–14 = 100) as calculated prior to 1950. This index as of July 1, 1954, was reported as 282. The resulting parity is $2.49. Ninety per cent of this parity price yields a national average support price for wheat through the 1954–5 crop year of $2.24 per bushel. This is the highest support level declared thus far. See The Wheat Situation, no. 140, 08, 1954, 19–21 Google Scholar; and no. 142, Feb., 1955, Table 3, p. 16. For a fuller discussion of the price support programme and parity formula, see Price Programs (Washington: U.S. Dept. of Agriculture, 1955), 1–107.Google Scholar
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14 See The Wheat Situation, 04, 1955, Table 2, p. 20.Google Scholar
15 Includes exports of wheat and wheat flour expressed as wheat. Using accepted conversion factors, these rates provide a differential of from 15 to 35 cents a bushel in favour of flour. Based on data obtained by correspondence from the Washington representative of the Canadian Wheat Board. See also U.S. Dept. of Agriculture, Grain Market News, III, no. 19., 05 13, 1955 Google Scholar, quoting export payments of 72 to 87 cents a bushel on wheat and $2.41 to $2.58 per cwt. on wheat flour.
16 Based on Grain Trade Year Book, 1930–1 to 1939–40 for pre-war years and on Report of the Canadian Wheat Board, Crop Year 1953–54, Appendix, Table XVII, p. 14, for the post-war years.
17 See The Wheat Situation, 04, 1955, Table 4, p. 22.Google Scholar
18 Public Law 690, chap. 1041, 83rd Congress, 2nd Session.
19 Public Law 118, chap. 195, 83rd Congress, 1st Session.
20 Public Law 665, chap. 937, 83rd Congress, 2nd Session; see also Mutual Security Appropriation Act, 1955, Public Law 778, chap. 1262, 83rd Congress, 2nd Session.
21 Public Law 480, chap. 469, 83rd Congress, 2nd Session.
22 Public Law 118, sec. 550 (b) (1).
23 Public Law 480, sec. 101(a).
24 See Morse, True D., Responsibilities of the U.S. Department of Agriculture in the Foreign Agricultural Field (Washington: U.S. Dept. of Agriculture, 02 7, 1955), 5.Google Scholar
25 Ibid., 5.
26 Ibid., 4–5.
27 Based on data obtained by correspondence from the Washington representative of the Canadian Wheat Board and press announcements issued by U.S. Dept. of State and U.S. Dept. of Agriculture, Aug., 1954–May, 1955.
28 See Grain Trade Year Book, 1953–54, 64–6.
29 See report of announcement by U.S. Secretary of Agriculture in Journal of Commerce, 03 30, 1955.Google Scholar
30 See Announcements GR–262 and GR–302 (Washington: U.S. Dept. of Agriculture, 1955).
31 See Canadian Grain Commentary, II, no. 12, 03 24, 1955.Google Scholar
32 For section 22 as re-enacted and amended see Compilation of Statutes Relating to Soil Conservation, Marketing Quotas and Allotments, Crop Insurance, Sugar Payments and Quotas, Price Support, Commodity Credit Corporation, and Related Statutes as of January 1, 1955 (Washington: U.S. Government Printing Office, 1955), 182–3.Google Scholar
33 See evidence of Mr. George H. McIvor, Chief Commissioner, Canadian Wheat Board, before the United States Tariff Commission at the Public Hearings ordered for September 8 and 10, 1954, Washington, D.C., re importation of barley and oats, contained in the Commission's transcripts of Hearings, September 8 and 10, at pages 162–72 and 331–40 respectively.
34 Information by correspondence from the President, Winnipeg Grain Exchange.
35 Since the above was written the restrictions on rye have been extended for a further period of two years without change in the annual quota (see Canada, H. of C. Debates, 07 4, 1955, pp. 5620–1Google Scholar). On September 9, 1955, President Eisenhower announced that restrictions on die imports of oats and barley would be discontinued effective October 1, 1955. It was officially stated that although “it appears unlikely that oats and barley would be imported in such quantities as to interfere materially with domestic price support programs for these grains … the Department of Agriculture will continue to maintain a close review of the situation and if conditions change … will recommend new investigations under Section 22” ( U.S. Dept. of Agriculture, Grain Market News, III, no. 37. 09 16, 1955, 1–2.Google Scholar
36 See Compilation of Statutes, 183.
37 See Canada, H. of C. Debates, vol. 97, no. 53, 03 22, 1955, pp. 2250, 2292–5.Google Scholar
38 ibid., pp. 2250–1.
39 See The Wheat Review, 04, 1955, 1.Google Scholar For the full crop year ending July 31, 1955, Canadian wheat exports showed a decline of 3.3 million bushels as compared with the previous year whereas United States exports increased by 65.1 million bushels (ibid., Aug., 1955, 1).
40 See Canadian Grain Commentary, II, no. 1, 01 6, 1955.Google Scholar
41 See Canada, H. of C. Debates, 05 16, 1955, pp. 3781–4.Google Scholar See also continuing debate on Canadian and United States wheat policy, ibid., May 17, pp. 3827–63.
42 See Canadian Grain Commentary, Jan. 6, 1955.
43 ibid., no. 17, April 29, 1955.
44 Bean, Louis H., cited in Canada, Dept. of Agriculture, Overseas Report on Agricultural Developments, no. 9, 03, 1954, 2–3.Google Scholar
45 See Baum, Richard K., “Asia—Expanding Market for Wheat Foods,” Foreign Agriculture (Washington: U.S. Dept. of Agriculture), XIX, no. 3, 03, 1955, 43–7.Google Scholar
46 See The Wheat Review, 04, 1954, 15 Google Scholar, and ibid., April, 1955, 15.
47 See ibid., April, 1954, 2, and April, 1955, 3.
48 The actual Canadian wheat carry-over as at July 31, 1955, was 493.7 million bushels ( The Wheat Review, 09, 1955, 1 Google Scholar).
49 For example, after an initial payment of $1.40, a gross surplus of $130 million was eventually realized on the wheat operations of the Board covering the crop year 1953–4. All carrying charges and operating costs (that is, country elevator and terminal storage charges, interest and bank charges, administrative and general expenses, etc.) of the Board, amounting to $65.3 million, equivalent to 16.4 cents a bushel, were deducted, leaving a balance of $64.7 million for distribution to growers. See Supplementary Report of the Canadian Wheat Board on the 1953–54 Pool Account—Wheat, 2–5.
50 Butz, Earl L., “We Can't Just Send Our Farm Surpluses Overseas,” Foreign Agriculture, XIX, no. 1, 01 1955, 10.Google Scholar
51 See The Wheat Situation, no. 139, 06, 1954, 11–17.Google Scholar
52 See ibid., no. 140, Aug., 1954, 19–20; and Price Programs, 43–55.
53 See The Wheat Review, 02, 1955, 23.Google Scholar
54 See report on development in American agricultural policy in Canada, Dept. of Agriculture, Agriculture Abroad, X, no. 4, 04, 1955, 38–43.Google Scholar
55 Actually 77.3 per cent of the growers voted in favour of continued controls and subsequently a minimum support price of $1.81 was announced for the 1956 wheat crop (based on 76 per cent of estimated parity)—as compared with a support price of $2.08 for the 1955 crop ( The Wheat Situation, no. 145, 08, 1955, 14–15).Google Scholar
56 See D.B.S., Farm Cash Income, 1954 (Ottawa, 1955), 3–6.Google Scholar
57 See D.B.S., Farm Net Income, 1954 (Ottawa, 1955), 2–7.Google Scholar
58 See Clark, S. D., “The Frontier and Democratic Theory,” Transactions of the Royal Society of Canada, series III, 06, 1954, vol. XLVIII, section II, 65–75.Google Scholar