Canada: Bread for Russia

The broad prairie wheat fields of Canada are fast becoming a breadbasket for the Communist world. Last month, scooping into its gigantic surplus, Canada closed its second big grain sale to Red China—this time for more than $360 million. Last week the Russians came to call and quietly negotiated the biggest single one-year wheat export deal in Canadian history.

According to Ottawa, which expected to sign the agreement this week, the Russians want a staggering 225 million to 250 million bu. next year. Estimated value: $500 million. Added to the China sale and Canada’s normal 250 million-bu. wheat trade, the purchase will boost exports 50% higher than the 1952 record of 336 million bu. The deal could produce a trade surplus of nearly $1 billion, biggest since 1945.

The sale seemed to confirm some Western suspicions about the state of Soviet agriculture. Russia has always been an exporter of wheat, and usually went into the market only to shore up its satellites or because it was cheaper to ship Canadian grain across the Pacific to Siberia than send its own wheat the 7,000-mile length of Russia. At that, the Soviets never bought more than 14.8 million bu. a year.

But now the Russians apparently need wheat to make up for crop shortages, both in the Ukraine, suffering from scorching drought, and in Nikita Khrushchev’s ambitious “virgin-lands” development scheme in Soviet Asia. Canadian Agriculture Minister Harry Hays returned from an 18-day trip behind the Iron Curtain to report that Russians insistently asked what Canadians did about drought and dust. On his recent Russian journey, U.S. Agriculture Secretary Orville Freeman went through the Ukraine but was permitted to travel only to the fringe of the virgin-lands.

From beneath their crushing surpluses, world wheat suppliers in the U.S. viewed the huge Russian purchases and a poor Western European crop with a hopeful eye. They saw signs of a “fundamental change” in the international market.