Courtesy Reuters

Our Wheat Surplus

IF WE look back to the difficult days which immediately followed the formation of the United States we find that even then the country needed a European market for such commodities as it could produce abundantly and cheaply. It needed to trade its raw materials for imports of manufactured goods from the older countries. The Southern States long had such a market in tobacco and, following the invention of the cotton gin in 1793, began the development of a still more important export trade in cotton. From Virginia northward through the Middle States there early grew up, too, a flourishing business in the export of wheat and flour. In 1790 it reached a value of $5,800,000, or about one-third more than the tobacco trade of that year. But as European policy after the Revolution was distinctly unfriendly to the admission of wheat and flour, a considerable part of American exports of these commodities went to the West Indies. Then a peculiar turn of events enlarged the European demand and boosted wheat and flour prices to a degree which greatly improved the American economic situation. The French Revolution and other Continental conflicts, culminating in the Napoleonic Wars, simultaneously impaired production and increased consumption of wheat in Europe. Encouraged by the resulting high prices, farmers from Virginia up to the Connecticut Valley turned to the production of this staple, and the private profits and favorable exchange relations which resulted did not a little to strengthen the economic position of the young republic.

After the close of the Napoleonic Wars and our second war with England the situation changed sharply. "Consumer resistance" again asserted itself in Europe, with blighting effect on our export trade in wheat. Farmers of the northeast seaboard no longer could find a profitable export market, whilst new production areas began to expand in western New York, Ohio, and other parts of the trans-Appalachian region. The opening first of canal and then of railway communication with the West expanded production, lowered freight costs, and

Loading, please wait...

Related Articles

This site uses cookies to improve your user experience. Click here to learn more.

Continue