CORNER IN FOOT.

Taranaki Daily News, 1 March 1922, Page 5

CORNER IN FOOT.

AN AMAZING SCHEME. SPECULATION IN WHEAT. DEARER BREAD FOLLOWS. By Telegraph.—Press Assn.—Copyright. Received Feb. 28, 7.45 pm. London, Feb. 27. The Morning Post’s market correspondent says the biggest wheat corner on record is to be attempted. Last week the London flour trade agreed to stand in, and proclaimed a rise of two shillings on all flours, making four shillings within a fortnight. The bakers at first refused to buy, but later agreed, increasing bread by a penny, which increased their profit to the extent of four shillings a sack, which is their share of exaction from the people. This movement, like all its predecessors, is based oh May options. Liverpool is already operating at prices indicating that the “bulls” intend to clear profit by May 31. The quantity of wheat to be held back for an advance of from seven to eight shillings a bushel amounts to 7,000,000 bushels. It is held by Australian speculators, who succeeded in forming a group and supporting the Canadian and American syndicate, which ingeniously started as the Wheat Inquiry Bureau. These 18,000,000 quarters of wheat require £50,000,000 to manipulate them, but a profit of a shilling per bushel means £7,200,000 in three months, while even the borrowing of £50,000.000 at ten per cent, would leave a margin of £6,000,000. The bakers are already assuming that wheat will go to 64/1, whieh is more than half what the wheat ‘hulls” are aiming at. Elevenpence for a loaf of bread will enable the “bulls” to realise their £6,000,000 profit. Probably the speculators fear the bakers may increase bread to a shilling, and thus bring about a return of the Food Controller. The reasons which decided the speculators to concentrate upon wheat are three. Firstly, there is the large amount of unemployed capital which is usually used in the rubber, iron, metal, tea and sugar markets, none of which are suitable for speculation at present. Secondly, there is a reasonable prospect of success before the large wheat surplus from India can be moved. If India ships to Britain 1,000,000 quarters monthly between June and the end of die year the success of the corner after July 1 will be impossi* le for the rest of the year, but hardly any new Indian wheat will reach Mark Lane before July. During March, April and May the market requires 8,500,000 quarters, of which British farmers cannot find more than a million. Stocks amount to about 2,000,000, and the consumer therefore requires 5,500,000 quarters landed by May 31, not a sack of which can come in if the corner bolds together.

Argentina at present is outside the corner, which it is fighting. The prospects at present of the ingenious enterprise succeeding are increased by the heartiness ■with which the millers and the bakers put up bread a pAny before they hurt the great wholesale operators, who may possibly welcome the control of bread prices, as they complain that the bakers are apt to give the show away.—Aus.-N.Z. Cable Assn-