Business & Finance: Corn Corner

Not since Thomas Montgomery Howell tried unsuccessfully to corner corn six years ago has the Chicago grain market witnessed such a knockdown battle as took place last week. Though the nation’s corn bins will soon overflow with the biggest corn crop since 1932, corn supplies last week were very low because last year’s carryover was the smallest of this century. With deliveries of September corn futures due on Sept. 30, longs had the best opportunity in many a harvest moon to soak shorts.

With corn prices up 21¢ in 15 days to $1.1 6 a bu. it became apparent that shorts could not cover their obligations in time except at the longs’ terms. Farmers National Grain Corp., leading U. S. grain co-operative and a leading short, formally complained to the Commodity Exchange Administration, charging “major manipulation.” C.E. A. Chief J. W. T. Duvel cracked back with a stinging rebuke : “Every time there is a price rise or fall, there is an outcry from those who lose money.” Two days later, however, having already tripled margins and taken the unusual step of ordering traders to reveal their market positions without easing the strain, the Chicago Board of Trade suspended trading in September corn, ordered all deals settled at a price of $1.10½ a bu. It was the first time since 1918 that such emergency action had been necessary to halt a corn squeeze.