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BUSINESS AND FI N A N C IA L
CONDITIONS
THIRD FEDERAL
PHILADELPHIA
» RESERVE DISTRICT
JUNE I, 1923
By RICHARD L. AUSTIN, Chairman and Federal Reserve Agent
FEDERAL RESERVE BANK of PHILADELPHIA
SUMMARY OF BUSINESS CONDITIONS
IN THE UNITED STATES
Production and trade continued in large volume dur weeks of previous years, owing chiefly to heavy ship
ing April. There was some slackening of business ments of manufactured goods. In spite of present
activity in the latter part of the month and during the heavy traffic, the shortage of freight cars has largely
early weeks of May, partly on account of seasonal disappeared.
Employment at industrial establishments continued
influences.
The Federal Reserve Board’s index of production to increase during April, although plants in Eastern
in basic industries declined about 1 per cent in April. states reported some reductions in their forces, and there
Production of lumber, anthracite coal, was an increase in those states in the number of con
Production and mill consumption of cotton de cerns working part time. Increases in wage rates were
creased, while there were increases in announced by many concerns, and average weekly earn
the output of pig iron and petroleum. There was a ings of factory workers increased about 1 per cent.
further increase in the value of building contracts Wholesale and retail trade were somewhat smaller in
awarded in April, but the value of building permits April than in March, which is the customary trend at
issued in 168 cities was 16 per cent less than the record
this season of the year. Both were well
figures of March. The decrease was due chiefly to a Trade above the level of a year ago. Decreased
curtailment of new projects in New York, as the
sales by department stores in April, as com
aggregate value of permits at other reporting cities pared with March, were in part due to the fact that
showed an increase of 20 per cent. Car loadings con Easter purchases were made in March and to unseason
tinued to be much larger than in the corresponding able cold weather in many localities. Mail order sales
BANK CREDIT
1919
1920
1921
1922
1923
accompanied by a somewhat larger liquidation of in
vestments, which was general throughout the country.
Partly through the sale of these investments, reporting
member banks have met the demand for additional
loans without obtaining increased accommodation at
the reserve banks. The volume of Federal Reserve
Bank credit has, consequently, continued to remain
fairly steady at the level which has prevailed since the
middle of January, and the volume of Federal Reserve
Notes in circulation has remained practically unchanged.
Somewhat easier money conditions are indicated by
slightly lower rates on commercial paper and lower
yields on outstanding Treasury Certificates. The
Treasury offering of approximately $400,000,000 4J4
per cent Notes, maturing March, 1927, was heavily
oversubscribed, and the issue wT subsequently quoted
as
at a slight premium in the open market.
during April were 10 per cent less than in March, but
32 per cent larger than a year ago.
Prices of certain basic commodities declined during
April and the early part of May. The general index of
wholesale prices of the Bureau of Labor
Wholesale Statistics, it is to be noted, showed no
prices
change between March and April.
Prices of building materials, metals, cloths and cloth
ing were higher in April than in March, these advances
being offset by declines in prices of fuel, and of farm
products, especially live stock and dairy products.
Since the middle of April the volume of bank credit
in use has remained relatively constant. Between April
11 and May 9 loans of member banks in
Bank leading cities showed an increase of nearly
CrC * $100,000,000, a large part of which occurred
in the Chicago district. These increases in loans were
TABLE OF CONTENTS
Agriculture ..................................................
Bankers’ acceptances................ .................
.................
.................
Chemicals .................................... .................
Cigars and cigarettes.................
Coal .............................................
Coai, anthracite ...........................................
Coal, bituminous ........................................
Coke ..............................................................
commercial paper .........................
Cotton goods .................................. .............
.............
.............
District summary ......................... .............
Drugs, wholesale ...........................
Drygoods, wholesale ..................... .............
Electrical supplies .........................
Employment and w ag es...............
30
8
13
12
12
PA G E
IS
IS
16
16
17
17
3
11
Financial conditions ..................................
Floor coverings ...........................................
Foreign exchange .......................................
Furniture .....................................................
Groceries, wholesale ...................
Hardware, wholesale ................................
Hides and skins .........................................
Hosiery ..........................................................
Iron .................................... >........................
Leather ..........................................................
Lumber ..........................................................
National summary .....................................
Paint ..............................................................
Paper ..............................................................
Paper boxes .................................................
Retail trade . ..........., ...............................
Rubber, crude ............................................
Rubber, mechanical go o d s......................
Rubber, tires ..............................................
Savings deposits .......................................
6
21
8
22
10
11
25
20
14
24
13
1
14
26
27
9
26
25
25
7
PAG E
Securities .....................................................
Shipbuilding .................................................
Shoes ..............................................................
Shoes, wholesale ........................................
Silk goods ...................................................
Silk, raw .......................................................
Silk, thrown .................................................
Steel ...............................................................
Sugar, raw ...................................................
Sugar, refined .............................................
Summary, district ....................................
Summary, national ....................................
Synopsis of business conditions ...........
Tobacco l e a f .................................................
Underwear ...................................................
Wholesale trade .........................................
Wool, raw ...................................................
Woolen and worsted g o ods......................
Wool yams .................................................
Special Article: How the bank reserves of the Federal Reserve System affect the average bank depositor........32
2
PAGE
7
15
23
10
19
20
20
14
27
28
3
1
4
29
21
10
19
18
18
S U M M A R Y OF B U SIN ESS C O N D ITIO N S
IN THE
TH IR D FEDERAL R E SE R V E D IS T R IC T
T
HE past few weeks have witnessed a definite buying is not an unfavorable development, as it re
slackening in wholesale buying, further price re flects a healthy feeling of conservatism which should
cessions on many commodities, and to a certain prevent anything in the nature of a runaway market.
extent a slowing down of industrial operations. Much caution has been shown by the reluctance of both
This
of the change, it is true, is of a seasonal nature, as a and sellers to contract for distant delivery
buyers
lull usually occurs in April. But the curtailment of and by an almost total absence of the duplication of
purchasing is probably in large measure attributable orders, which was so largely responsible for the subse
to the unwillingness of buyers to meet the steadily ad quent wave of cancellations and the business collapse
vancing prices. As a result of this resistance, the oi 1920. Moreover, there is considerable evidence that
prices of many commodities that had reached new high consumption is keeping pace with production. Stocks
levels in February and March have declined substan of goods in the hands of manufacturers and dealers are
tially during April and May. Copper, tin, and lead comparatively light, and in most cases are not accumu
have declined from one to four cents a pound since lating. Except in a few instances the resistance to
March, and even some of the iron and steel products, prices and curtailment of purchases encountered in
which had been in excellent demand, have recently dis wholesale buying, has not been manifested in buying
played a trend toward lower levels. Bituminous coal at retail. The volume of sales by department stores,
has been falling in price steadily for the past two mail order houses, and chain stores, during 1923 has
months, and quotations on crude petroleum and refined far exceeded that of the same period of last year, and
oils receded during May in spite of the record-breaking sales by wholesale dealers have also been unusually
consumption of petroleum products. Other commodi large for the season. April sales by department stores in
ties, including sugar and rubber, have also declined this district, it is true, did not equal the 1922 figures, but
in recent weeks, the latter being quoted on May 18 at that was due to the fact that Easter purchases last year,
26 cents, or more than 30 per cent below the 1923 peak. were made in April. For the first four months of this
This falling off in prices has naturally led to reduced year, however, retail merchants in this district and
ordering of manufactured goods, and in some instances throughout the country report sales from 10 to 15 per
to cancellation of orders or to requests for postpone cent larger than those for the same period last year.
ment of shipments. Textile mills in this district, with Exceptionally active distribution of commodities is
the exception of those making carpets and rugs, are busy seen also in abnormally large freight-car loadings, es
on old orders, but are receiving little new business, and pecially of merchandise and miscellaneous freight. In
in some cases note a few requests for cancellations. the first four months of the year the number of cars
Underwear manufacturers report dull business and a loaded exceeded the previous high record, that of 1920,
number of cancellations, but hosiery mills, especially by nearly 11 per cent, and during the four weeks end
full-fashioned mills, are receiving a fair volume of busi ing April 28 total‘loadings were nearly 30 per cent
ness. Iron and steel plants are very active in filling greater than those of the same period of 1920. During
existing orders, but there have been few inquiries for the latter period, however, loadings were reduced by the
future delivery, and some slight price concessions have switchmen’s strike.
been made. Building material manufacturers, in One factor that is responsible for considerable appre
general, are well supplied with orders and have been hension on the part of manufacturers is the increase in
especially active during the spring months. But in the manufacturing costs resulting from the continued rise
case of certain materials, notably, bricks and lumber, in wages. Competition between employers for the lim
ited existing supply of labor has caused a further
some firms report a falling off in inquiries of late.
Industrial operations, on the whole, are still being bidding-up of wages during the past month, and many
maintained at a high rate, and the recent decline in factories are still operating on reduced schedules, owing
SYNOPSIS OF BUSINESS CONDITIONS
Compiled as of May 23, 1923
Business
Bricks
Chemicals
Cigars
Coal, anthracite
Coal, bituminous
Coke
Cotton goods
Cotton yarns
Drugs, wholesale
Dry goods, wholesale
Electrical supplies
Floor coverings
Furniture
Groceries, wholesale
Hardware, wholesale
Hosiery, fullfashioned
Hosiery, seamless
Iron and steel
Leather belting
Leather, heavy
Leather, upper
Lumber
Paints
Paper
Paper boxes
Rubber tires
Rubber, mechanical
goods
Shipbuilding
Shoes, manufacture
Shoes, retail
Shoes, wholesale
Silk goods
Silk, thrown
Sugar, refined
Underwear, heavy
weight
Underwear, light
weight
Woolen and
worsted goods
Woolen and
worsted yarns
Demand
Good
Fair
Fair to good
Good
Poor
Fair
Poor to fair
Poor
Fair to good
Fair
Good
Good
Fair
Fair to good
Good
Fair
Fair
Fair to good
Good
Fair
Fair
Fair to good
Good
Good
Fair to good
Fair to good
Fair
Poor
Fair
Good
Fair
Fair
Poor
Fair
Poor
Poor
Fair to good
Poor to fair
Third Federal Reserve District
r, .
Finished
Pr,ces : stocks
Firm
41 Light
Firm to lowerj Light
Moderate
Firm
Light
Firm
Moderate
Lower
Moderate
Lower
Moderate
Lower
Moderate
Lower
Moderate to
Unchanged
heavy
Moderate to
Strong
heavy
Moderate
Firm
Light
Firm
Firm to
Moderate
higher
Moderate, de
creasing
Moderate to
Firm to
heavy
higher
Moderate
Increasing
Moderate
Firm
Light to
Fairly firm
moderate
Moderate
Firm
Barely steady Heavy
Moderate
Firm
Light to
Firm
moderate
Moderate
Higher
Light to
Firm to
moderate
higher
Firm
Light
Firm
Heavy
Light to
Firm
moderate
Firm
Moderate
Firm
Moderate
Firm
Moderate
Firm
Moderate
Firm
Moderate
Firm
Heavy
Firm
Light to
Firm
moderate
Light to
Firm
moderate
Light to
Strong
moderate
Light to
Firm
moderate
•
4
Labor situation
Supply
| Wages
Higher
Some scarcity
Higher
Some scarcity
Sufficient
| Unchanged
Some scarcity ! Unchanged
Sufficient
I Unchanged
Sufficient
Unchanged
Some
Some scarcity
advances
Some scarcity
Sufficient
Scarce
Higher
Unchanged
to higher
Higher
Some scarcity
Some scarcity
Scarce
Some scarcity'
Some scarcity
Some scarcity
Some scarcity
Some scarcity
Scarce
Scarce
Some scarcity
Some scarcity
Scarce
Scarce
Unchanged
to higher
Unchanged
to higher
Higher
Unchanged
Unchanged
to higher
Higher
Higher
Unchanged
to higher
Higher
Unchanged
to higher
Higher
Higher
Higher
Unchanged
to higher
Scarce
Higher
Scarce
Some scarcity
Some scarcity
Scarce
Some scarcity
Higher
Unchanged
to higher
Unchanged
to higher
Higher
Higher
Collections
Fair to good
Fair to good
Fair
Fair
Fair
Fair
Fair to good
Fair to good
Fair
Fair
Fair
Good
Fair to good
Fair
Fair
Fair to good
Fair to good
Fair
Fair to good
Fair to good
Fair to good
Fair
Fair
Fair to good
Fair to good
Fair
Fair to good
Fair to good
Fair to good
Fair
Fair to good
Fair to good
Good
Fair to good
Fair to good
Fair to good
Fair to good
to the scarcity of both skilled and unskilled workers.
The high wages paid in the building industries have
drawn many workers away from the factories and
farms. Indeed, the agricultural sections in the district
have suffered from this industrial and building compe
tition to such an extent that an acute shortage of farm
labor has developed which will seriously interfere with
the harvesting of crops. In the building industry
wages and other costs are so high that many contracts
have been postponed indefinitely. In Philadelphia and
other eastern cities the value of building contracts and
permits issued in April was considerably less than in
March, in spite of the fact that a seasonal increase
usually occurs at this time. Building costs have now
reached a level 30 per cent above that of last spring.
EMPLOYMENT AND WAGES
Evidence of a slackening in the rate of in
dustrial expansion is seen in the employment reports
received from representative manufacturing establish
ments in this district. Employment increased from
March to April, it is true, but only by .8 per cent, a
smaller increase than in any previous month of this
year. In March, employment at the 502 establishments
reporting to this bank was 1.7 per cent larger than in
February, and in the latter month it was 2.6 per cent
greater than in January. Furthermore, only 14 of the
31 industries included in our index contributed to the
advance; in 11 industries decreases were reported, and
6 showed no change. Many of the changes, however,
were of a seasonal nature. Canneries reported the
usual expansion in preparation for the busy summer
season, and employment at cement mills and petroleum
refineries also increased seasonally. Foundries and
machine shops, iron and steel plants, shipyards, paper
mills, and bakeries, all showed increases, while sugar
refineries, most of the textile mills, and glass plants
reported smaller employment in April than in March.
On the whole, the changes in the other industries were
inconsequential. The accompanying tables show our
revised index numbers of employment and wages in
502 manufacturing establishments in the Third Federal
Reserve District.
General industrial employment in the district is now
more than 5 per cent greater than in January and 20
per cent larger than the 1922 average. It is significant
that the bigger establishments in the district have
shown a greater percentage increase in employment
since 1922 than the smaller. Seventy-six of the 502
reporting establishments are large plants employing
more than 500 workers. Employment at these plants
is now 22 per cent greater than the 1922 average,
whereas the smaller plants, i. e., those employing less
than 500, have increased only 9 per cent. This is
illustrated in the accompanying chart, which shows the
percentage increases since 1922 in employment at the
two groups of plants.
EMPLOYMENT
IM 0 E X
N U M B ER S
Longfe plants
Small plants
Average A p r il
All plants
Average A pri
Employment in reporting plants in principal cities
Third Federal Reserve District
Cities
Number
of
reporting
firms
Allentown ...
18
Bethlehem ...
4
Bloomsburg .
4
Bridgeport ...
3
Camden ........
16
Chester .........
6
Columbia ....
3
Easton ..........
8
Harrisburg ..
8
Hazleton ....
3
Lancaster ....
7
Lebanon .......
4
Norristown ..
3
Philadelphia .. 190
Pottstown —
4
Reading ........
17
Scranton ....
14
Trenton ........
18
Wilkes-Barre v 5
12
Williamsport .
Wilmington ..
13
Vork ..............
18
All others ..... 124
Index numbers
Average 1922=100
Number
employed
1 April
J
Jan. Feb.
Mar.
April
102
112
113
103
107
108
90
101
110
120
112
113
112
117
109
119
109
100
102
106
115
114
111
101
113
111
95
109
119
111
105
118
128
106
131
111
123
116
120
110
111
107
116
117
112
113
98 3,512
112 '505
113 1,447
95 1,577
111 16,335
128 5,177
114
924
104 1,937
122 2,789
130 2,543
103 1349
140 1,172
114
'649
122 89,382
108 1,183
115 8,461
112 2,495
113 7,042
108 1,070
113 2,635
119 8,631
114 2,217
115 39,102
102
114
111
107
108
125
102
103
109
123
106
113
110
120
114
117
106
104
103
109
115
113
112
i
1922
1923
1922
1922
Employment in the large plants, 1. e., those employing more than 500
operatives, has shown a much larger increase since 1922 than
that in plants with less than 500 workers. The increases
were 22 per cent and 9 per cent, respectively, causing
a general increase of 20 per cent
Source—Federal Reserve Bank of Philadelphia
Numerous wage advances were made in factories in
the district during April, and the weighted average of
weekly per capita earnings increased to $25.61, as com
pared with $25.47 in March. As in the case of employ
ment, however, the increase in earnings was much less
pronounced than in the preceding month, owing largely
to decreased operations in many industries. There is
now little or no surplus of industrial labor, and in most
Wages and Employment
Third Federal Reserve District
Average weekly wages
umber
Industries
of
sorting
irms
502
All industries
M etal products:
Automobiles and parts............... 19
Electrical machinery .................. 18
Foundries and machine shops... 37
Iron and steel products............... 32
9
Car construction and repair....
5
Shipbuilding .................................
Textile products:
Carpets and rugs......................... 14
Clothing ........................................ 22
Cotton goods................................. 17
4
Felt hats ......................................
Knit goods ................................... 26
Silk goods .................................... 37
Worsteds and w oolens............ 24
Food products:
18
Bakeries ........................................
8
Canneries .......................................
Confectionery and ice cream.... 20
Slaughtering and meat packing. 12
Sugar refining .............................
3
Building M aterials:
Cement .......................................... IS
7
Glass ..............................................
Pottery .......................................... 10
M iscellaneous:
Boots and shoes........................... 16
Leather .......................................... 29
Chemicals and paints.................
17
Cigars and tobacco....................... 14
Furniture ....................................... 17
Musical instruments ...................
2
Paper and pulp............................. 13
Printing and publishing............. 20
Petroleum refining.......................
5
Rubber tires and goods............... 12
Index numbers
Average 1922=100
January February March
Index numbers
Average 1922=100
Actual
A
Actual
*1
April
January February March
April
A*
1
109
112
115
115 $25.61
114
117
119
120
110
105
112
125
109
99
108
108
115
127
114
102
114
108
122
132
118
101
112
100
124
134
119
104
26.84
19.80
26.34
28.47
29.89
26.46
121
112
113
121
162
112
127
114
116
122
170
118
131
123
120
128
176
117
7,353
129
3,442
124
121
6,415
131 22,072
175 . 27.866
121
11,425
99
107
103
98
103
109
98
104
115
105
103
109
115
104
104
117
107
96
111
110
110
101
115
107
94
111
113
110
26.61
19.80
22.44
23.24
20.68
19.27
22.07
111
98
104
119
103
105
101
113
100
103
121
105
105
102
113
103
104
121
107
107
98
115
101
103
120
107
107
97
4.174
3,631
6.983
4,764
5,748
12,870
9,666
105
85
110
104
99
105
82
105
104
98
103
131
111
103
110
103
107
107
104
112
27.07
19.65
19.68
27.34
30.14
102
109
96
105
88
103
no
98
104
102
102
105
98
101
103
106
115
98
100
100
2,886
2,548
4,506
1,753
2,309
122
126
77
114
119
81
131
132
86
140
130
87
30.97
34.46
28.43
103
95
88
104
108
90
108
115
94
110
106
95
7,465
867
1,843
105
109
114
107
105
96
116
108
108
100
103
111
111
115
107
99
111
108
112
106
109
113
115
112
110
102
117
106
113
106
103
106
121
110
109
104
125
106
115
107
18.47
22.97
30.45
15.49
23.82
26.82
26.53
33.29
26.48
25.81
106
104
123
102
113
109
106
100
103
105
104
104
125
96
113
109
106
105
105
110
101
105
126
93
115
111
104
105
106
118
102
105
126
91
114
112
106
106
107
118
2,536
8,488
4,970
5.684
2,735
8,007
2,700
4.683
6.271
5,974
industries a pronounced shortage, especially of com
mon labor, exists. The higher wages offered in the
construction and manufacturing industries have caused
a widespread migration from agricultural districts to
the cities, so that a serious shortage of farm labor is
being felt throughout the district.
Reports received by the Bureau of Labor Statistics
from more than 5,000 establishments throughout the
United States, employing over 2,000,000 workers, show
much the same trend in employment and wages as re
ports show in this district. General employment in
creased less than one per cent in April, as compared
with March, and only 19 of the 43 industries repre
sented contributed to the advance. The Bureau also
states that wage increases were reported in each of the
Employment
202,634
43 industries by a total of over 800 establishments.
Average weekly earnings, however, increased only .9
per cent, or slightly more than the amount as reported
in this district.
FINANCIAL CONDITIONS
Total loans, discounts, and investments of reporting
member banks in the Third Federal Reserve District,
totaling 933 millions on May 9, were practically the
same as they were a month previous. Investments de
clined 1 million, and secured loans 7 millions, but other
loans, principally commercial in character, increased
from 333 to 342 millions. Figures for reporting mem
ber banks in all districts show an increase in other loans,
and a considerable falling off in investments; but se
cured loans increased. Changes by districts are given 48 to 62 millions, the holdings of purchased paper re
below:
main unchanged at 22 millions, and the Government
securities owned declined from 34 to 25 millions.
Stock prices fell off sharply in the past month, carry
Increases or decreases in loans and investments
ing the average of 20 industrials from 101.10 to 92.77
from April 11 to May 9
and of 20 rails from 86.75 to 80.13.
(All figures in millions of dollars)
Securities Bonds did not share in this weakness, but
Other
Secured
Invest
on the contrary all groups except the
District
loans
loans
ments
public utilities are higher. Call money renewals were
quoted at Al/ 2 per cent during the ten days ending May
1. Boston ..................................... + 4.3
+ 8.6 — 2.1
21. Transactions in stocks for the month up to that
2. New York ............................... + 3 2 .6
— 32.3 — 58.1
3. P h i l a d e l p h i a ........................ — 7.6
+ 9.4 — .9
date were even lighter than in the same period in April.
4. Cleveland ................................ + 1 9 .3
+ 7.2 — 7.4
Comparative averages of prices follow:
5 . Richmond ............................... — 2.4
+ 1.6 +
-3
6.
Atlanta .................................... + 3.2
7. Chicago ...................................
8. St. Louis .................................
9. Minneapolis ...........................
10. Kansas City ...........................
11. Dallas ......................................
12. San Francisco .......................
All districts ..................... .
+ 2 9 .1
— 2.3
— .3
— .1
— 20
+ 1-7
+ 7 5 .5
— 7.0
+ 2 4 .1
+ 7.1
— 4.8
— 1.9
— 92
+ 1 8 .5
—
—
—
—
—
—
—
.6
22.1
4.5
5.4
2.9
15
1.9
+ 2 1 .3
— 107.1
Two
months
ago
May 21,
1923
Securities (average prices):
20 industrial stocks.................
20 railroad stocks ...................
10 first-grade rail bonds ........
10 second-grade rail bonds...
10 public utility bonds ...........
10 industrial bonds .................
4 Liberty bonds .....................
Month
ago
$92.77
80.13
86.24
82.71
86.40
93.49
97.71
$101.10 $105.23
89.67
86.75
85.47
84.59
81.40
82.27
87.04
86.86
93.01
92.51
97.77
97.57
The Federal Reserve Bank of Philadelphia reports
an increase in total earning assets from 100 millions on
April 18 to 109 millions on May 16, owing to an in
crease of 12 millions in discounted bills and a decrease
of 3 millions in purchased paper. The reserve ratio An increase of 0.9 per cent in savings deposits dur
declined from 74.2 to 71.2 per cent as a result of an ing April is reported by 80 banks in this district. This
increase of 5 millions in note circulation and of a fall
compares with decreases of 0.2 per cent
ing off of 1 million in deposits and of 7 millions in total ^°delVsits anc^ ^ Per cent *n
reserves. As compared with the beginning of the
**
1921 respectively. Deposits 1922 and
increased
year, discounted bills of this Bank have increased from from $449,252,000 on April 1 to $453,217,000 on May
1, a net gain of $3,965,000. Only $176,000 of inter
est was credited during the month. Percentage
Banking statistics—Third District
changes by cities follow:
(000,000’s omitted)
Reporting member banks:
Loans and discounts:
Sec’d by U. S. securities___
Sec’d by other stocks and
bonds ...................................
All others (commercial)__
Total ...................................
Investments ...........................
Total deposits .......................
Federal Reserve Bank:
Discounted paper .....................
Purchased paper .....................
United States securities..........
Total earning assets ............
Federal res. note circulation..
Total deposits ...........................
Total reserves ...........................
Reserve ratio .............................
Latest *
$18
269
342
$629
304
801
Four
weeks
ago
$18
276
333
$627
305
795
Eight
weeks
ago
Number
of
reporting
banks
$18
262
332
$612
302
795
Altoona .............
Chester ...............
H arrisburg.........
Johnstown .........
Lancaster ...........
Philadelphia ---$62
$62
$50
Reading . . . . ---22
25
28
Scranton .............
25
29
25
Trenton .............
Wilkes-Barre ...
$109
$119
$100
Williamsport ---203
198
198
Wilmington .......
119
119
120
York ...................
229
216
236
71.2% 74.2% 68.1% Other cities ........
District total...
MayFor reporting member banks May 9; for Federal Reserve Bank
16.
Savings deposits in the Third Federal Reserve District
7
5
5
4
6
3
9
3
6 •
6
5
4
5
5
14
80
Per cent increase or decrease
May 1, 1923, compared with —
April 1,
1923
May 1,
1922
May 1,
1921
+1.4
+ 4
+8.2
+1.9
+3.0
+ -3
—1.3
+3.7
+2.6
+1.3
—1.0
+ .3
— .2
+1.2
+ -9
+ 11.4
+ 8.4
+43.2
+ 8.2
+38.2
+ 5.0
+ 6.1
+ 6.4
+12.1
— 2.5
+ 7.8
+17.8
' +14.0
+ 5.5
+ 6.4
+ 16.9
— 3.2
+110.0
+ 2.4
+ 49.7
+ 6.0
+ 11.0
+ 20.0
+ 12.4
+ 9:0
+ 12.9
+ 18.6
+ 23.9
+ 11.8
+ 9.0
The supply of bankers’ acceptances is said to be small
by the five dealers operating in this district who report
Bankers*
t0 Bank. Their sales show a fall.
ing off from last month, occasioned
entirely by a decline in purchases by
the Federal Reserve Bank. Sales to other banks and
investors, although not large, increased materially over
the previous period. The consolidated figures of these
dealers, reduced to weekly averages, follow:
Weekly averages for period—
1923:
April 16 to May 16.................
March 12 to April 15............
February 12 to March 11___
January 15 to February 11..
1922:
April 17 to May 14.................
Sales
to
F. R. Bank
Sales
to
others
$646,000
1,208,000
2,424,000
2,815,000
$337,000
116,000
182,000
135,000
Purchases
$260,000
525,000
642,000
299,000
2,208,000 444,000 790,000
Twelve banks in this district executed acceptances to
the amount of $3,767,000 in the month ending May 10,
against $4,240,000 in the previous month, and $3,274,000 a year before. Wool, cotton, sugar, coffee, hides
and skins, grain, and silk are some of the principal
commodities involved in recent acceptance transactions
in this district and elsewhere.
Offering rates for maturities up to 90 days are gen
erally 4y% per cent.
The demand for commercial paper, though spotty,
has improved. Some of the city institutions which
Commercial unt^ recently have been out of the
paper
market have purchased in a limited
way, and more country banks are
showing an interest than heretofore. Little change has
taken place in rates during the past month, and the
bulk of the sales is still at 5 and 5% per cent. A num
ber of names, however, are offered at 4j£ per cent, and
a few sales are reported at that rate, although some
transactions are still being made at Sl/ 2 per cent. The
offering by the Government of a new loan at
per
cent has, in the opinion of certain dealers, acted as
somewhat of a check upon business. The supply of
paper has not increased materially, and dealers’ lists
are not large. It seems that borrowers continue to use
the banks in preference to the open market.
During April, six dealers in this district sold, paper
to the amount of $7,932,500, as compared with $5,932,000 in March; and the sales by five of these dealers
totaled $5,937,500 in April, 1923, as compared with
$4,657,570 in April, 1922. The banks outside of Phila
delphia continue to buy the majority of the paper sold,
as is seen in the fact that sales within the city were
$3,582,500, as against $4,350,000 outside.
Prices at which the above transactions were made
varied from 4j4 to 5j4 per cent, but the sales at the out
8
side quotations were only slightly over 1 per cent of
the total. About 50 per cent of the business was at
5jq per cent, and the balance was almost equally
divided between 5 and 5y2 per cent.
The foreign exchange market has been rather quiet
during the past month, and trading for the most part
.
has been confined to routine buying
roretgn
and selling-. American banks in
® general are carrying moderate balances
abroad, according to some observers, largely because of
the uncertainty as to European conditions. Sterling con
tinued its downward movement, and on May 10 touched
$4.6077, a new low point for this year. Since then, how
ever, it has recovered somewhat. At $4.6077, sterling
was about five cents below the rate prevailing a month
ago. Heavy buying of both government and private
securities in the United States has been partly respon
sible for this, and also funds have been drawn to this
country by the higher interest rates. Call loan rates in
New York are around 5 per cent, as against 1l/ 2 per cent
in London. In addition, it is believed that the British
Government is accumulating credits in this country in
anticipation of the debt payment due on June 1.
French and Belgian francs have fluctuated within
narrow limits, and even the rejection of the German
reparations offer by the French Government had little
effect upon them. In some quarters it is thought that
the comparative stability of francs is partly because re
cent French imports have been purchased largely by
drawing on foreign balances. In addition, receipts
from tourists’ expenses are commencing to attain fair
proportions, and an improvement is noted in the recent
statements of the Bank of France. Lire lost a few
points, but on the whole they have been steady and
rather inactive. German exchange continues to be un
steady, with marks falling almost daily. The efforts
of the German Government to stabilize rates have had
little effect, as circulation is increasing rapidly, and
holders of marks are making heavy offerings. These
influences, together with limited buying support and
the failure of the recent German reparations offer, have
tended to depress quotations.
Among the former neutral exchanges, Norwegian,
Swiss, and Spanish currencies have been especially
weak. Lower rates for kroner are attributed to the
banking crisis in Christiania, and the decline in pesetas
and Swiss francs was probably due, to some extent, to
sales by German interests.
Of the South American exchanges, Argentine pesos
were weak, and lost over two cents during the month.
Brazilian rates dropped a few points, but Chilean pesos
were somewhat stronger. With the exception of yen,
which advanced slightly, Far Eastern currencies have
changed but little since last month. Canadian dollars
have hovered around $.98.
Foreign exchange rates
Noon cables
Pa+
value
May 21,
1923
April 21,
1923
May 21,
1922
London ................. $4.8665 $4.6296 $4.6552 $4.4492
Paris ..................... .1930 .0667
.0897
.0666
Antwerp ............... .1930 .0574
.0827
.0575
Milan ..................... .1930 .0486
.0495
.0508
Berlin ................... .2382 .000020 .000038 .003165
Vienna................... .2026 .000014 .000014 .000102
Amsterdam .......... .4020 .3915
.3914
.3883
Copenhagen ......... .2680 .1861
.2132
.1888
Stockholm ............ .2680 .2669
.2674
.2595
Madrid ................. .1930 .1525
.1534
.1600
Berne ................... .1930 .1804
.1814
.1906
Buenos A ires....... .9648 .8174
.8300
.8250
Shanghai ............. .7082 .7438
.7407
.8136
RETAIL TRADE
Preliminary reports of retail sales during May in
dicate that they will total considerably more than those
of May, 1922. Prices at retail continue to advance
slightly, but the changes in quotations on spring goods
are small as compared with those on goods now being
purchased by retailers for the fall trade. For exam
ple, men’s and women’s ready-to-wear clothing in
heavier weights shows advances of from 10 to 15 per
cent over last autumn’s prices, and carpets, silks,
hosiery, and some grades of furniture are higher. An
exception to the general advance is cotton goods, which
have recently been quoted at below March prices.
Reports are almost unanimous that retailers are pur
chasing cautiously and are offering strong resistance to
advances in the prices of the goods which they buy.
Store managers throughout the district express the fear
that higher prices will be followed by lessened buying
by the public. They report, too, that the consumer is cau
tious and is not spending money recklessly on luxuries
as he did during the last period of active employment
and high wages.
In nearly all parts of the district a scarcity of em
ployees is noted, and in a number of stores, especially
outside of Philadelphia, wages have been increased and,
according to some, are now higher than ever before.
The following table, compiled from reports of re
tail merchants in the Third Federal Reserve District,
shows that the decrease in sales during April, as
compared with April, 1922, was 2.7 per cent. Sales
in department stores decreased only 2.2 per cent. But
Condition of retail trade during April, 1923
C o m p a r is o n
of
N
et
C o m p a r is o n
S ales
April, 1923
with
April, 1922
All reporting firm s...................
Firms in—Philadelphia ............
—Allentown, Easton
and Bethlehem.........
—Altoona ...................
—Chester .....................
—Harrisburg ..............
—Johnstown ...............
—Lancaster .................
. —Reading ...................
—Scranton .................
—T renton ...................
—Wilkes-Barre ..........
—Williamsport ...........
—Wilmington .............
—York .........................
—All other cities........
All department stores ....
Department stores in Phila.......
Depart, stores outside Phila__
All apparel stores...............
Men’s apparel stores
—in Philadelphia ...................
—outside Philadelphia ..........
Women’s apparel Mores
—in Philadelphia ...................
—outside Philadelphia ..........
Credit houses...................
Jan. 1 to
April 30, 1923
with
Jan. 1 to
April 30, 1922
April 30, 1923
with
April 30, 1922
— 2.7%
— 3.5 “
+ 1.5“
— 1.1 “
+ 3.5 “
+ 4.7 “
+ 3.6 “
— .2“
— 1.9“
— 5.7 “
— 7.0 “
— .2“
— 7.5 “
— 7.9 “
— 8.2 “
— 1.5“
— 2.2 “
— 2.6 “
— 1.7“
— 8.5 “
— 8.8 “
—16.6 “
— .6“
—10.6 “
+11.4 “
+ 13.9%
+ 11.8 “
+16.1 “
+14.2 “
+49.5 “
+16.6“
+23.9 “
+18.9 “
+17.3 “
+17.9 “
+10.2 “
+19.1 “
+ 6.8 “
+15.1 “
+13.9 “
• +13.5 “
+13.0“
+11.5 “
+15.1 “
+13.6 “
+13.0“
+17.3 “
+17.5 “
+ 4.6 “
+28.8“
+10.1%
+ 6.3 “
+ 4.1 “
+ 3.7 “
+34.1 “
+13.1 “
+11.3 “
+11.4 “
+18.2 “
+ 2.5 “
+30.9 “
+13.6 “
+15.5 “
+ 3.9 “
+23.7 “
+11.3“
+ 7.9 “
+16.2 “
+ 4.2 “
+12.1 “
+ 8.9 “
— 9.7 “
+ 4.9 “
+26.9 “
* Times per year based on cumulative period.
9
of
S tocks
R ate
of
T urnover*
Percentage of
orders outstand
ing April 30,
April 30, 1923 Jan. 1 to Jan. 1 to
1923, to
Apr. 30, Apr. 30, total purchases
with
March 31, 1923 1923
1922
in 1922
+1.9%
+1.2 “
—3.3 “
+3.8 “
+5.2 “
+ -6“
+1.4 “
+2.1 “
+5.1 “
+3.2 “
+ 2 .4 “
+ .8“
+3.5 “
+2.0 “
+6.5 “
+1.9 “
+ .9“
+ 3 .3 “
+ 2.1“ .
+ 9.4“
+4.5 “
+ .5“
—4.0 “
+1.3 “
3.1
3.8
2.5
2.6
2.5
2.9
2.5
2.2
3.4
3.1
2.9
2.2
1.6
2.4
1.9
3.0
3.6
2.5
3.4
2.8
1.8
6.8
3.4
2.6
1
2.9
3.6
2.2
2.4
2.6
3.0
2.2
2.0
3.1
2.9
2.9
2.4
1.5
2.1
1.9
2.9
3.4
2.4
3.2
2.8
1.6
•5.4
3.4
2.2
8.4%
8.5 “
8.3 “
12.5 “
4.7“
8.9 “
9.4 “
9.9 “
8.4 “
4.0“
“
4.2 “
2.1 “
3.3
sales in apparel stores decreased 8.5 per cent. Credit
stores, however, continued to gain, and show an increase
in sales of 11.4 per cent. Cool weather has, of course,
retarded business, especially in the cities and towns out
side of Philadelphia. But the chief cause of the poorer
showing is that this year all of the pre-Easter business
fell in March.
WHOLESALE TRADE
In all of the wholesale lines except hardware, sales
were smaller in April than in March, because of sea
sonal influences. Exactly the same was true last year.
And in spite of this seasonal decline, the gains over last
year have been remarkable. Sales of boots and shoes
were smaller, it is true, but in the other lines the vol
ume of sales increased by from 16 to 32 per cent. Part
of the gain in sales in dollars was due, of course, to the
advance in wholesale prices. The indexes compiled
by the Bureau of Labor Statistics are shown below:
Index numbers of wholesale prices
April,
1923
C loths and clothing ........................
F ood ...........................................................
A11 com m odities .................................
March,
1923
April,
1922
136
205
144
159
135
201
143
159
124
171
137
143
In all lines, collections were less prompt in April
than in March.
Sales of shoes at wholesale usually decrease during
May, as compared with the previous months. A large
part of the business is normally in white
Shoes shoes and in repeat orders on lines in which
sales at retail have been large and stocks
have become depleted. This year the sales of white
canvas shoes for women have been poor, but for chil
dren they have been normal. White leather lines are
in fair request, but some dealers say that the demand
has been considerably retarded by the vogue for colored
shoes. Repeat orders are chiefly for the latter, but
unfortunately for the dealers, their stocks of these
were very slight. In the early season no one was will
ing to buy heavily of colored shoes, for at that time
they were a very doubtful novelty, though later they
proved to be the best sellers of the season in women’s
lines. Men’s shoes, though moving from wholesalers
to retailers in fair quantity, have not been active.
Stocks in wholesalers’ hands are said to be fairly
large for this period of the year, and purchases for fall
have been confined mostly to standard lines, especially
felt slippers and rubbers; as have sales for fall. Collec
tions, although reported by some to be slow, are gen
erally regarded as fair.
During April, sales in this district, as reported to the
Federal Reserve Bank, decreased 31.5 per cent as com
pared with March, and 6.6 per cent as compared with
April, 1922. The ratio of accounts outstanding on
April 30 to sales was 265.7. This compares with 187.9
on March 31, and with 235.0 on April 30, 1922.
Although grocery sales at wholesale were 1.8 per
cent smaller in April than in March, they show a re
markable gain over the figures for last
Groceries year. The index of sales compiled by
this bank was 113 in April, as compared
with 115 in March and with 83 in April, 1922. The
improvement over last year reflects the gain in employ
ment and the higher wages. The demand is now from
fair to good; in fact, a third of the reporting firms find
it to be good. Over 90 per cent of the orders booked
are for spot delivery. As is to be expected at this time,
canned goods are the best sellers. Of these, canned
vegetables rank first, with canned fruits second, and
evaporated milk third. Dried fruits, cereals, and soaps
are also reported active by some wholesalers. The
table on page 11 shows the number of firms, out of a
total of 63, who report the above items as being in
demand:
Condition of wholesale trade during April, 1923
Percentage of increase or decrease in—
Number of
reporting
firms
Accounts outstanding
April, 1923. compared
with—
Net sales
April, 1923, compared
with—
Mar., 1923
Boots and shoes . . . .
Drugs .........................
D rygoods...................
Groceries ...................
Hardware ..............
14
15
20
61
34
Apr., 1922
Mar., 1923
Apr., 1922
—31.5%
— 5.4 “
—20.3 “
— .8“
- f 6.0 “
— 6.6%
+ 16.3 “
+32.4 “
+29.6“
+19.4 “
— 3.7%
— 1.1 “
— 2.4 “
+ 4.1 “
+ 4.1 “
+13.1%
+25.2 “
+21.0 “
+27.0 “
+22.5 “
10
Ratio of accounts
outstanding to
sales
Apr., 1923 Mar., 1923 Apr., 1922
265.7% 187.9%
139.9 “ 131.7 “
258.0 “ 210.6 “
108.8 “ 105.8 “
157.7 “ 156.6 “
235.0%
131.7“
282.4“
112.3 “
1512“
but in the majority of cases they have been decreasing,
and now range from moderate to heavy.
Collections are about the same as they were a year
ago, but in April they were slower than in March. The
ratio of accounts outstanding to sales was 258.0 per
cent in April and 210.6 per cent in March.
Sales in April, as reported by 34 wholesale hardware
firms, were 6.0 per cent larger than those in March
and 19.4 per cent above those in April,
Wholesale stocks 'are moderate, and on account of Hardware 1922. Our index of sales for the past
the movement of canned goods, the supplies of 75 per
two months and for the corresponding
cent of the wholesalers have been decreasing.
months of 1922 is as follows:
During the past month, prices have varied on many
kinds of merchandise. The rapid advance in sugar,
Average monthly sales in 1922=100
1923
1922
which attracted much attention, ceased during the first
week in April, but the subsequent decline was not great,
103
and was followed by another advance. The trend of M arch................................................... 122
111
sugar prices will have considerable influence on the cost April ..................................................... 125
of canned goods during the coming season. Prices of
canned vegetables and fruits, of syrups and candy, have Demand has been good for practically all products,
increased, but quotations on dried fruits have become
contractors, and
weaker. Dried beans, coffee, and cheese have also de and builders, buyers. Farmersfactories have been espe
cially heavy
and coal mining com
clined.
panies have also been buying. Stocks in the majority
Collections in April were less prompt than they were of cases are heavy, but a few
report them to be
in the month before. The ratio of accounts outstand only moderate. With about 50firms cent of the dealers,
per
ing to sales increased from 105.8 for March to 108.8 stocks are decreasing, but in the remaining cases they
for April.
are either steady or increasing.
note a
Because the movement of goods at retail was re greater resistance to price advances Many firms of buy
on the part
tarded by unfavorable weather, wholesalers have found ers, but others have encountered no resistance at all.
the demand for drygoods to be only Collections vary considerably, but in general they
Drygoods
fair- Although 32.4 per cent larger may be classed as
The
than those of a year ago, the sales in outstanding to sales fair. 157.7, April ratio of accounts
was
as
April were 20.3 per cent smaller than those in March. in March and with 151.2 in April, compared with 156.6
1922.
In spite of the rather poor spot demand, the booking
A slight falling off in the demand for drugs at whole
of orders for fall delivery has been fairly satisfactory.
Drygoods houses in general report that such orders are sale caused sales to be 5.4 per cent smaller in April
than in March, but at this season of the year,
larger than they were a year ago. In fact, the volume
of sales for the first four months of 1923 is much in Drugs sales are normally expected to be slower
than during the winter. Half of the report
excess of the corresponding figures for 1922, as is
shown by the table below. Part of the increase, of ing firms have experienced some improvement in de
course, has been caused by the advance in wholesale mand since May 1, but others have found no change.
quotations on cotton goods, which since January 1, In comparison with the business transacted last year,
the sales this spring, estimated in dollars, show a con
1923, have risen about 10 per cent.
siderable gain, as may be seen from the table below:
Canned vegetables ........................................................
Canned fru it...................................................................
Evaporated milk ............................................................
Canned goods, in general ............................................
Total canned goods ..............................................
Cereals .............................................................................
Dried fruits ........................
Soap .................................................................................
Salt, coffee, and flour ..................................................
18
7
5
12
42
5
5
3
2 (each)
Drug sales in 1923 compared with sales in 1922
Wholesale drygoods sales in 1923 compared with
sales in 1922
January
February
March
+24.6%
+28.6%
+32.4%
The merchandise that has been selling most rapidly
is wash goods, such as dress ginghams, poplins, voiles,
and denims, overalls, and work shirts. The arrival of
fall goods has caused some wholesale stocks to increase,
11
February
March
April
+ 21 .6 %
April
+23.8%
January
+ 9.9%
+ 5 .8 %
+ 16 .3 %
During May, the crude drug market has been quiet
because of the approach of the new crop of botanicals.
Owing to the short supply of many items, particularly
those of European origin, the carry-over will not be
large. In the botanical market, price changes have
been of little importance. The trend of prices during likewise decreasing and are moderate in size. Plants
the past month is shown by the following indexes:
in this district are operating at about 90 per cent of
capacity, their chief production difficulties being the
continuance of shipping delays to some sections and the
* Price index
* Price index
of 40 botanical
of 35 drugs and
increasing scarcity of unskilled labor. Wages for the
drugs
fine chemicals
latter have been advanced about 10 per cent, and some
establishments have also raised the pay of their skilled
Week of May 1..........
151.8
171.5
help.
171.4
152.0
Week of May 7..........
144.8
171.5
Week of May 14..........
Collections are fairly good and are about the same
149.9
171.5
Week of May 21..........
as they were a month ago.
159.9
Last year .....................
106.6
* Compiled by “Oil, Paint and Drug Reporter.”
Stocks of drugs in the hands of wholesalers are
moderately heavy, but in the majority of cases they
are not increasing. Heavy and increasing supplies are
reported by a third of the reporting firms. Collections
are fair.
CHEMICALS
The great industrial activity of the first third of the
year has been reflected in a strong demand for many
chemicals, but the alkali group has been inactive. In
general, sales are heavier than they were a year ago,
but they have diminished within the past month. On
account of the lack of orders for the alkalis, such as
caustic soda, dealers are reselling at considerable losses
the shipments delivered to them on contract. Conse
quently, manufacturers of heavy chemicals find diffi
culty in obtaining new orders. Manufacturers of
prussiate of soda complain that dealers are not taking
their full quotas on their yearly contracts.
Hydro-sulphites and sulpho-oxalates have been
bought in large quantities by dyers and printers of
fabrics respectively. The use of the latter for dis
charge printing has been increased by the call for “King
Tut” fabrics. Lithopone has been in excellent demand
by manufacturers of paint and linoleum. Sales of lin
seed oil have also been heavy, but some transactions are
reported at prices about 10 cents below the crushers’
quotations of $1.19 per gallon for carload lots. For a
time crushers had difficulty in making deliveries on con
tracts, owing to the scarcity of flaxseed, but this has
been relieved by liberal shipments from Argentina.
The new American crop will be ready in September.
Crushers are offering future contracts for delivery from
June to September at prices about 10 cents below spot
quotations. While the Emergency Tariff was in force,
American crushers were at a distinct disadvantage be
cause the duty on seed was high and the duty on oil
was only 10 cents per gallon. Now that the duty on oil
is 24 cents a gallon this situation is corrected. Al
though the volume of sales of ammonia is smaller than
it was at this time last year, it is fairly heavy.
Finished stocks in the hands of manufacturers are
light and are decreasing. Supplies of raw material are
BUILDING
The value of building permits issued in April, as re
ported by fourteen cities in the Third Federal Reserve
District, declined $3,063,587 from the total for March,
but was $11,758,744 greater than that for April, 1922.
In the table on page 13 will be found the number of per
mits and their estimated value for April, 1923, and for
the corresponding month last year, together with the
cumulative totals for the first four months of both years.
Usually, April permits are considerably larger than
those of March. Last year, for example, there was an
increase of nearly $3,000,000. The decline this year is
generally attributed to higher costs of materials and
labor; indeed, numerous cases are reported of contracts
being postponed because of these factors. The accom
panying chart shows the price index of five of the
principal building materials in 1913, in April, 1922, and
in April, 1923, calculated upon the basis of 1913 prices.
Structural steel, it will be noted, shows the greatest
advance during the past year. It must be remembered,
however, that the rising cost of materials is not the sole
factor that tends to check operations, but that the scar
city and high wages of labor also are having their
effect.
Although the great majority of brick manufacturers
report a good demand, and in a few cases a demand so
good that they have been forced to refuse
Bricks orders, certain others have noticed a falling
off during the past month. In cases in
which business has decreased, this is attributed to the
suspension of building operations because of higher
costs of material and labor. Many manufacturers,
however, have sufficient orders on their books to insure
operations for several months. In some localities,
bricks are so scarce that they are being brought in from
other districts that hitherto have not been considered
a source of supply. Operations are at capacity in prac
tically all cases, the exceptions to this being caused by
a shortage of help. Unskilled labor is especially
scarce, and numerous operators report also a lack of
skilled labor. Nearly all manufacturers have granted
wage increases of from 10 to 15 per cent to unskilled
workers, and many have made similar advances to
skilled. The hourly rate for unskilled men is now from
45 to 50 cents an hour, as compared with 35 and 40
cents last fall.
Stocks in general are light and are decreasing; and
raw materials are in adequate supply. Prices for the
most part have not changed since last month, as the
manufacturers have absorbed the increased cost of
labor. In Philadelphia, common bricks are quoted at
$22 a thousand, and although prices vary in different
cities, that may be considered a fair average for the
entire district. Little resistance has been offered to the
increased quotations that have been made during the
past two or three months; in fact, certain manufactur
ers state that they would have no difficulty in obtaining higher prices than they are asking.
Collections vary from fair to good and show little
change from last month.
With the majority of dealers, sales of building lum
ber are good, but some wholesalers have noted a dis
tinct decline in orders during the past few
Lumber weeks. They believe that this is because
many retailers have fairly heavy stocks,
which, although contracted for, have not yet been
moved from the yards. In most cases, however, busi
ness is brisk, and most orders are for immediate deliv
ery. Certain dealers have even been forced to refuse
further orders and are limiting their sales to old cus
tomers. Sales to industrial users continue to be heavy.
Although a fe*v advances have been made on certain
classes of lumber, the general level of prices has been
.steady. Mills are carrying only moderate stocks and
these are tending to decrease. The average percentage
of operations is over 90, the limiting factor in most
cases being shortage of labor. Numerous reports are
made of scarcity of both skilled and unskilled labor, and
many manufacturers have given both classes of workers
increases varying from 5 to 20 per cent.
Transportation conditions have improved consider
ably, and only in a few cases are embargoes causing
difficulties. Collections vary from fair to good, being
about the same as they were last month.
Dealers in electrical supplies are continuing to enjoy
good business, except in the case of radio equipment,
in the sales of which there has been a
Electrical
seasonal decline. The majority of orsupp tes ^erg are £or imme(jiate delivery, and in
practically all cases it is possible to meet the demand.
Stocks in most instances are moderate and are decreas
ing. Some dealers are having difficulty in obtaining
Building permits issued and estimated cost—April, 1923
Third Federal Reserve District
January to April inclusive
1922
1923
Estimated cost Permits Estimated cost
Permits Operations Estimated cost Permits Operations Estimated cost Permits
1923
Allentown ................... 156
Altoona ....................... 321
Atlantic C ity .............. 408
104
Camden ......................
H arrisburg................. 148
Lancaster ................... 128
Philadelphia ............... 1.540
Reading ...................... 462
Scranton ..................... 214
Trenton ....................... 226
W ilkes-Barre............. 154
135
Williamsport .............
Wilmington ... .v;.... 136
York ........................... 218
Total for April___ 4,350
Do not report operations.
225
$950,160
341
799,333
408* 1,053,656
127
1,784.601
190
841,020
371,340
128
2,984 19,729,815
512
649,875
214*
465,195
647,435
299
506.536
154
51,615
135*
570,682
268
218
359,781
6,203 $28,781,244
1922
142
292
404
95
190
115
1,415
484
187
200
253
170
110
230
4,287
302
$870,275
331 $2,414,505
158 $495,080
557
663,506
584 1,253,539
279,079
292
802,424 1,134 4,004,725 1,263 3,115,172
335 1,724,460
309 3,180,462
721.445
102
335 1,320,380
415,005 * 334 4,029,125
244
311
829,500
302 1,119,535
286,750
144
2,033 11,363,610 4,414 54,098,560 5,097 30,366,375
331,135 1,014 2,083,930 1,096 1,678,071
510
416 1,359,908
369
699,731
237.409
187
451 1,055,399
502 2,626,051
419,196
202
958,437
442 1,505,907
327
817,110
253
574,740
318
716,596
217
506,411
170
279 1,450,675
366 1,501,638
202,831
123
393
296,606
467 1,065,476
145,015
230
4,648 $17,022,500 10,717 $80,270,631 11,548 $46,292,653
13
delivery on equipment bought in New England, because
of the freight situation there, and others report slow
delivery on their orders for copper wire and conduit
pipes. Prices are rising on many materials, and lists
are higher than they were last month and a year ago.
Quotations on specialties, however, have changed but
little recently. Electrical contractors are busy on work
placed some time ago, but they report that although
they are receiving numerous inquiries, few contracts
are being closed at this time. Competition in many
localities continues to be very keen.
Collections in practically all cases are fair, and al
though they are little changed from last month, in some
instances they are slower than they w^re last year, and
in others more prompt.
As is to be expected at this season, sales of painthave been heavy. In many localities “paint up and
clean up” weeks have been held, and these
Paint have added to the demand that was already
coming from operators engaged in new
building. Practically all orders are for immediate
delivery.
Although quotations on pig lead have declined dur
ing the past month, this has not yet been reflected in
lower prices for lead pigments ; leading corroders, how
ever, have given price guarantees to the end of August.
On May 1, many manufacturers increased quotations
on their ready-mixed paints by from 15 to 25 cents a
gallon.
Finished stocks range from moderate to heavy and
are either steady or decreasing. Manufacturers are
carrying only medium-sized supplies of raw materials,
and these are gradually being diminished.
Operations vary from 80 to 100 per cent of capacity,
and although there is some shortage of both skilled and
unskilled labor, in the majority of cases the labor sup
ply is adequate. The freight situation is now causing
little or no difficulty.
Collections are from fair to good, and several manu
facturers consider them to be more prompt than they
were a year ago, although during the past month they
have changed but little.
IRON AND STEEL
In certain lines of the iron and steel industry, notably
in pig iron, buyers have become cautious, and are mak
ing few inquiries and placing little business. Buying
of pig iron for the third quarter has recently been
slight, and purchasers are holding off in the hope that
the easier coke prices now prevailing will be reflected
in lower quotations. Many eastern furnaces, on the
other hand, have considerable business that will carry
them over into the third quarter, and under such con
ditions they are not disposed to make concessions. Al
though plates, shapes, and iron bars are moving well,
there has been a falling off in inquiries, and consider
ably less future business is being placed. Deliveries at
earlier dates on these products are more possible at this
time, but several mills are not yet accepting orders for
the third quarter. Most manufacturers of iron and
steel castings have continued to receive substantial
business from the machine tool and various other in
dustries, and factories making machinery and machine
tools have, in general, been busy on orders from textile
plants, automobile manufacturers, sugar refineries, and
the building trades. It is apparent that the demand for
heavy products is considerably easier, but the lull in
buying has as yet affected few of the specialties. Al
though hardware manufacturers report fairly substan
tial business, some of them find it spotty, with orders
fluctuating greatly. This is attributed to the caution
that buyers have adopted, in an attempt to avoid load
ing up with goods at present prices. The decreased
buying is reflected in the unfilled orders on the books
of the United States Steel Corporation, which fell from
7,405,332 tons on March 31 to 7,288,509 tons on April
30, a decline of 114,823 tons. This decrease is the first
one reported this year.
In spite of the easier demand in some lines, produc
tion has been maintained at a high level. Output of
pig iron set a new record in April, the tonnage reach
ing 3,547,551, as against 3,523,868 in March. At the
end of the month, 310 furnaces were in blast, a gain of
14 from the total of the previous month. Output of
steel ingots, too, was heavy, and although the total of
3,321,275 gross tons, produced by the 30 companies that
in 1922 made 84.13 per cent of the total, was less than
that for March, the April rate was somewhat higher,
when the number of working days is taken into con
sideration. In this district 41 furnaces were in blast
on April 30, as compared with 39 on March 31. The
average percentage of operations in the various
branches of the industry is about 90.
As far as can be determined, finished stocks in most
cases are only moderate and are decreasing. This gives
strength to the view that consumption has kept pace
with production. In many instances production
schedules continue to be curtailed by lack of labor.
Manufacturers are almost unanimous in their reports
of shortage of workers, and numerous advances have
been made of from 5 to 15 per cent in wages. In
many instances, however, these increases have not ap
preciably relieved the shortage. One manufacturer re
ports that lack of men limits his operations to only 50
per cent of capacity, although he has sufficient orders
to warrant a 200 per cent schedule. Not a few men
have been attracted to the building and allied trades by
the higher wages that contractors are offering.
The advance in quotations that continued during the
first three months of the year, came to a stop in April
and prices became steady. And during the second
week in May several items showed a tendency to de-
dine. In the Pittsburgh district certain grades of pig
iron fell off from $1 to $3, but the price of 2 X Phila
delphia iron has been maintained at $32. Scrap has
been especially weak, and present quotations are from
$2 to $4 a ton below those prevailing a month ago.
Premiums have disappeared on most steel products, and
certain independents are even naming prices somewhat
below the recent level. The composite price of pig
iron, as calculated by the “Iron Age,” was $29.29 on
May 15, as against $30.79 on April 17, and during the
same period the composite price of finished steel de
clined from 2.810 cents to 2.789 cents.
Collections are about the same as they were last
month, and may be classed as fair.
SHIPBUILDING
Shipbuilders report few new orders during recent
months, and yards are using only about 30 per cent of
their capacity for ship construction and repairs. Several
operators are engaged in other types of work, such as
the manufacture of paper and laundry machinery, car
and locomotive repairing, and general jobbing and
foundry work. Most of the ships under construction
are of special types, such as ferry boats, floating grain
elevators, and river passenger boats. Shipbuilders are
unanimous in their opinion that the present outlook for
the industry in this district is poor. It is believed that
construction of special type of vessels will be the only
business available for some time.
The value of old ships has changed little, if any, dur
ing recent months. Tankers, however, because of their
growing use in the California petroleum trade, have
advanced considerably. The Shipping Board is offer
ing various types of vessels at prices below replacement
value, and this has tended to hold down rates in spite
of rising costs. Practically all commodities entering
into shipbuilding are higher than they were a year ago,
especially lumber and steel. It is said that American
builders cannot compete with British and continental
yards at present rates, owing to the higher costs of
materials and labor in this country. This has little
effect, however, as few contracts are being bid upon.
Practically all yards are short of both skilled and
unskilled labor. Wages were advanced by about 10
per cent in February, and additional increases of from
2 to 15 per cent have been made during the past month
COAL
Householders, with the memory of last winter’s ex
perience fresh in their minds, have been laying in do
mestic sizes, and as a result, sales have
Anthracite continued at an exceptionally high rate.
The beginning of the Lake season has
tended to make demand even more insistent. Steam
sizes, however, are still moving slowly, and some opera
tors have accumulated fair sized stocks.
Production is being maintained at a high rate, and
car supply is ample. Estimated output for the past
four weeks, together with that for the corresponding
weeks of 1922, was as follows:
1923
April
April
May
May
21
28
5
12
.......................
.......................
.......................
.......................
2,065,000 net
2,116,000 “
2,021,000 “
1,903,000 “
1922
tons 6,000 net
5,000 “
“
6,000 “
“
7,000 “
“
tons
“
“
“
The decrease during the second week of May was
caused largely by the holiday observance of Ascension
Day. The reduced production last year was, of course,
due to the strike that started on April 1.
Quotations on domestic sizes, for the most part,
have been firm during the past month, but those on
smaller sizes have continued to decline. Certain retail
ers have made reductions of 50 cents a ton, but the
majority are holding to prices that prevailed during the
winter.
, Operations are at capacity in practically all instances,
except where they are curtailed by a shortage of
miners’ helpers and even of miners themselves. Sev
eral local strikes have occurred, but these have been set
tled within a few days, and the labor situation is fairly
satisfactory, although in certain instances miners are
said to be restless. No steps have yet been taken by
the United Mine Workers Union as regards the re
newal or revision of the present wage agreement,
which expires on August 31. In past years, when
agreements expired on March 31, it was customary to
start negotiations in January or February. If a simi
lar length of time is allowed this year, negotiations
should commence within the next few weeks.
Collections with retailers are from fair to good.
The bituminous market has been sluggish during
the past month, and all classes of consumers are buying
but sparingly. A few railroad contracts
Bituminous were placed recently, but in general
buyers prefer to purchase in the spot
market, where quotations are below contract prices. The
movement to the Great Lakes, which had been held up
on account of ice, is now commencing, but so far this
has had little effect upon coals produced in this district.
Export inquiry is slight, and although numerous ship
ments have been made from the port of Philadelphia,
these were for the most part to cover orders placed
several weeks ago.
Falling prices have forced additional mines to close
down, but the surplus of cars gained in this way has
been shifted to the remaining mines, and this has per
mitted heavier operating schedules. * Operations in this
district average well over 60 per cent of capacity, the
highest point in many months. Because of the better
transportation conditions, production has fallen off but
15 .
slightly, in spite of the numerous shut downs. Esti The coke market has been comparatively inactive
mated output during the past four weeks and for the and most purchasers have filled only their immediate
needs, hoping that prices would continue to
corresponding weeks of 1922 was as follows:
Coke decline. Spot sales predominate, and few
contracts are being closed. Export inquiry
has fallen off considerably, but shipments are still being
1922
1923
made on past orders.
Connellsville furnace coke is freely offered at $5, and
April 21 ....................... 10.221.000 net tons 3.575.000 net tons some distress coke has been on sale at a lower figure.
Foundry grade is quoted at $6.
April 28 ....................... 10.103.000 “ “ 4.175.000 “ “
May 5 ....................... 10.061.000 “ “ 4.164.000 “ “
Production has decreased slightly during the month,
May 12 .................... 10,211,000 “ “ 4.433.000 “ “
although it is still at a high rate. Output of beehive
coke for the past four weeks was as follows:
The relatively low production in 1922 was because
of the miners’ strike.
April 21 ........................
437,000 net tons
April
“
Prices have continued to weaken, and nearly all May 28 ............................................................... 424,000 “ “
5
“
grades are lower than they were a month ago. Pool May 12 ............................................................... 407,000 “ “
............................................................... 403,000
10 grade, on May 14, was quoted at from $2.20 to
$2.60, as compared with $2.45 to $2.85 on April
Certain
some
16. The chart below shows the index of bituminous of their producers haveofsuspended operations inlighter
ovens because lower quotations and
coal quotations, together with the index for all com demand.
modities—1914 averages being used as a base.
COTTON
The past month has been a period of readjustment
for the entire cotton trade. During the early part, the
demand for grey goods was greatly curCotton tailed by the fear of buyers that yarn
®°° 8 prices would be reduced. The under
lying cause of the lack of confidence was the fact that
quotations on October cotton were lower than those on
the old crop. When raw cotton prices began to fluc-
The index of bitum inous coal prices, which has been above the general
comm odity index since the early part of 1920, now occupies
nearly the same relative position as it did a year ago
Sources—Bureau of Labor Statistics, “Coal Age”
Although bituminous prices are still relatively higher
than the general commodity index, they are in some in
stances probably below the cost of production. Many
operators consider it more advisable to sell at a loss
than to close down completely and receive no return
at all.
Labor conditions on the whole have been satisfac
tory. Where mines closed down, the men found work
with little difficulty in nearby mines that continued
operations, or else sought other lines of employment.
16
The increased costs of spinning and weaving and the strong demand
for goods during the period from 1917 to 1920 caused the spread
between the prices of print cloth and raw cotton to widen
greatly. But during 1921, quotations on cotton goods fell
so rapidly that the price of print cloth per pound was
less than the cost of the cotton from which it was
made. The spread at present reflects the
higher labor cost now, as compared with
1915
Sources—"Bradstr eel's,” “Cotton Facts”
tuate violently, customers refused to buy until the mar
ket became more stabilized. As a result of the poor
demand, prices on all cotton cloths were reduced dur
ing the first half of May, and the more attractive quo
tations then induced some resumption of buying.
This downward trend of prices is shown by the
chart on page 16, which gives the prices per pound
of spot cotton and print cloth (28", 64x64, 7 yards per
pound). It will be noted that the spread between the
cost of raw cotton and the price obtained per pound for
the cloth varies greatly. The largest difference occurs
in periods of strong demand.
The demand for flannels was good in the first quar
ter of the year, but during the past month it has been
adversely affected by the break in raw cotton prices.
The call for towels continues poor, and manufacturers
report great difficulty in obtaining business at prices
that will cover the increased cost of yarn. The fact
that style has favored mohair plush as a furniture cov
ering has made the demand for tapestry meagre. Sales
of auto robes have been good, but like those of many
other textiles, they have been retarded by the late
spring. Of the orders on the books, about 65 per cent,
on the average, are for delivery within 60 days, and
about 25 per cent for shipment during the month there
after. Some mills report that from 10 to 20 per cent
of their orders are for shipment later than 90 days.
Owing to the lack of demand for grey cloth, mills at
Fall River have curtailed production. In this district,
towel mills are running at about 65 per cent of capacity.
Mills making mohair plush are operating at capacity
on orders taken some time ago. The supply of labor,
especially of skilled help, is reported to be scarce in
many sections. Numerous manufacturers of draperies
and furniture coverings have made 10 per cent ad
vances, but manufacturers of towels have in general
made no changes.
Mill stocks of finished goods range from moderate to
heavy and during the past month have been increasing.
Towel stocks are heavy. However, supplies of yarn in
the hands of weavers, though moderate in quantity,
have been decreasing.
Collections have remained good during the past
month, and show a slight improvement over those of the
same period last year.
The fluctuations in the price of raw cotton, which
began in March, curtailed the future demand for cot
ton yarns. However, the spot demand
Cotton
although
yarns continued, the sharp to a decreasing ex
tent, until
break in raw cotton
prices on May 2nd, when that demand also was checked.
Buyers at present do not appear to be interested in cot
ton yarns even at concessions, except to fill immediate
requirements. Of the orders on the books of yarn
manufacturers about 65 per cent are for delivery within
60 days and about 25 per cent for delivery in from 60
17
to 90 days. The demand for combed yarns has been
even smaller than that for carded, owing to the fact that
the hosiery trade is not brisk and automobile tire manu
facturers have been using less combed and more carded
yarn. As a result of the slack demand, prices on sev
eral staple numbers during the period from May 2nd
to May 9th fell 3 or 4 cents. A comparison of present
prices of the same numbers with those prevailing a
month ago shows a decline of about 15 per cent from
the peak quotations in March.
Prices of carded yarns declined more than those of
combed yarns, because prices for the former had pre
viously advanced more than those for the latter. If
anything, the weakness in knitting yarns has been more
pronounced than that in weaving yarns. Stocks of
yarns in the hands of dealers are moderately light, but
owing to the slack demand are apparently increasing
in some cases.
Collections are fairly good.
In common with the stock market and the sugar,
grain, and metal markets, the cotton market began to
fluctuate violently when in March the
Kaw
bearish sentiment became dominant. Chief
cotton among the influences that affected it were
the falling off in exports and in mill consumption, and
the pressure from all sides discouraging speculation
and high prices. Reports of curtailed operations in
mills in Fall River and North Carolina, in addition to
reductions in the quotations on cotton goods to bring
them on a parity with October cotton, caused much
apprehension, and when all of these factors were com
bined with the uncertainty regarding the coming crop,
cotton prices advanced and declined sharply. Spot
sales became very small, and on May 3 the heavy liqui
dation of long interests caused a break of 85 points
in the old crop and of about 37 points in the new. But
the position of the old crop is still strong statistically.
Even though the exports and mill takings are seasonally
smaller, the visible stocks are steadily falling. That
they are much smaller than the stocks a year ago may
be seen by the table below. The quantity of cotton
Supply and takings of American cotton *
In bales
Season of Season of Season of
1922-1923 1921-1922 1920-1921
Visible supply, American, at end
of previous season (July 31).. 1,968,159 4,112,651 2,943,882
Crop in sight, American, to
May 18 ...................................... 10,542,001 9,715,728 9,991.404
Total ........................................ 12,510,160 13,828,379 12,935,286
Visible supply, American, on
May 1 8 ........................................ 1,624,183 3,162,663 4,592,890
World’s takings of American to
May 1 8 ........................................ 10,242,561 9,727,719 7,620,131
* Compiled by New York Cotton Exchange.
used by spinners continued to be heavy in April; and
although the figure of 577,396 bales, reported by the
Bureau of the Census, is smaller than the March con
sumption of 623,105 bales, it exceeds the April figures
of 443,509 in 1922, 419,247 in 1921, and 566,944 in
1920.
After being delayed in some sections by unfavorable
weather the planting of the new crop is now completed.
It is too early to determine the acreage accurately, but
the Government’s estimate of intended plantings showed
an increase of 12 per cent, and the estimates of private
agencies indicate a gain of about 10 per cent. In spite
of the larger quantity being grown, the activity of the
boll weevil will again be the chief determinant of the
size of the crop. Even if it were profitable to use poison
on farms where the productivity is not high, the quan
tity of calcium arsenate available this year would be
sufficient to protect only a small part of the acreage
planted.
In connection with the constantly recurring talk in the
English cotton trade of developing sources of raw cot
ton within the British Empire, it is of interest to note
that the percentage of the world’s supply grown within
the United States has varied but little during the past
fifty years. As will be seen in the chart below, the
United States produced about 65 per cent of the world’s
cotton during the last two decades of the nineteenth
century, but since 1900 the ratio of the American crop
to the total production has tended downward.
COTTON PRODUCTION
Because of the increasing importance of other sources of cotton, the
proportion of the world’s supply that is grown in this country
has been tending downward since 1900
Sources—Department of Commerce, "Journal of Commerce"
WOOL
During the past month, the demand for nearly all
wool fabrics, except coatings and cloakings, has de
clined decidedly,, and the call for suitings and dress
goods is now from poor to fair. Manufacturers of
men’s wear have been troubled by cancellations re
quested by clothing manufacturers on account of
returned goods from retailers.
Woolen and
The iatter have been unable to
worsted goods seU their spring suits because of
the cold weather. The demand for coatings has been ex
cellent ever since these lines were opened. Fancy-backs
are again in great request, but they no longer dominate
the field to the exclusion of other coatings. Fabrics for
infant wear have been active all spring. Woolen suit
ings are still sluggish. Of the orders on the books,
those that are scheduled for shipment within 60 days
average about 65 per cent of the total, and those to be
delivered during the month following, about 30 per
cent. Over a third of the mills in this district have
taken orders for delivery further than 90 days ahead,
and this business represents approximately 20 per cent
of their total.
In spite of the advance in the cost of labor and yarn,
weavers report great difficulty in booking business at
prices higher than their opening quotations. Prices
are tending upward, but during the last month few
mills have actually made any increases.
Production is continuing at an abnormally high rate,
and over 90 per cent of the looms in this district are
in operation. But in a few cases, some machinery has
been idle because of a lack of skilled help, which only
30 per cent of the mills report is in adequate supply.
Nearly all woolen and worsted mills have raised wages.
With this high rate of production, stocks in some cases
are tending to increase, but in half of the reporting
mills shipments are causing them to decline. Finished
stocks range from light to moderate, and supplies of
raw material are light and are decreasing.
Although collections are more prompt than they were
a year ago, they have not changed since last month,
and are still fairly good.
Although worsted spinners are operating at about
95 per cent of capacity, mainly on old orders, very little
new business is now being booked. How
Wool
ever, mohair and carpet yarns are in excelyarns jent demand. Sales of wool yarns for the
hosiery trade have been small, especially for women’s
hosiery. But some orders are being booked in men’s
wool hose. Although their buying has been retarded
by cold weather, bathing suit and sweater manufac
turers have re-entered the market during the past
month. Weavers of men’s wear have been buying con
siderable quantities of yarn, but the demand from mills
making women’s dress goods has been quiet. About
70 per cent of the orders on the books call for delivery
within 60 days, and 25 per cent for delivery in from
60 to 90 days.
Prices in general have increased since last month, but
owing to the lack of new business, there has been in
some cases a wide range of spinners’ prices. Some
18
delay is still reported in shipments to New England,
but the freight situation is in general improved. Skilled
labor, especially female, is tending to become scarce,
and wages for both skilled and unskilled workers have
been increased. Many of these advances have been
made on an hourly basis, but if reduced to a percentage
basis, they would average about 10 per cent.
Stocks of worsted yarns are still moderately light
because mills are making shipments as fast as yarns
are spun. In the majority of cases they are tending to
decrease. However, some woolen yarns have accumu
lated. Stocks of raw wool in the hands of spinners
are decreasing, and, although our reports are conflict
ing, they seem in general to be moderately heavy.
Collections are fairly good.
In contrast to the extreme quiet that has prevailed
since May in the Philadelphia wool market, the purchasing of the new clip in the West, both
K<wool s^orn ar,d on sheep’s back, has attracted
much attention. Encouraged by the strength
of foreign markets, western growers have placed their
asking prices so high that many dealers have not cared
to buy; but the shortage of fine wools has made mills
anxious to obtain a supply of them. The buying in all
parts of the world has favored wools of the finer grades,
such as merino and crossbreds higher than 50’s.
During this spring, there has been much interest in
the buying of fine wools for Japanese account, but
Japan’s imports comprise only about 2.8 per cent of the
world’s supply. Germany, however, is a much larger
consumer, and as shown by the chart below her imports
during the past two years have advanced to surprisingly
near their pre-war level.
During the past month, quotations on domestic wools
have advanced, but the large quantity of foreign wools
In spite of the adverse exchange rate, Germany imported almost as
much wool in 1922 as in 1913. Although Japanese buyers have
purchased considerable quantities of fine wool this spring,
Japan’s imports last year were small as compared
with those of Germany
Sources—Government reports of Japan and Germany
in the hands of dealers has caused some business to
be sought at concessions. Certain low-grade South
American wools are reported to have been re-shipped
abroad.
Although mills have not been buying additional sup
plies of wool, they have been using up their raw stocks
with rapidity. In March, the quantity of wool entering
production in the mills reporting to the Bureau of the
Census was 53,790,287 pounds, as compared with 52,361,000 pounds in March, 1922. Of this, 71.9 per cent
was of foreign origin. Spindle and loom activity for
the country as a whole was higher in April than at
any time since early in 1920. Owing to the activity of
worsted spinners, the supply of noils has been heavy,
and their prices have been low.
SILK
Because of the resistance to advancing prices, to
gether with the ending of the spring season, manufacturers of silk goods have found that as compared with those of the previous month, their
,
sales for the period from April 15 to May 15
were decidedly smaller. The current demand may be
described as less than fair, but it is still better than it
was at this time last year. The crepes, both printed and
in solid colors, continue in favor, and there is but little
call for yarn-dyed fabrics. The openings of fall silks
began about the first of May, but buyers hesitate
to go ahead at current quotations. Several mills report
that 100 per cent of their orders are booked for ship
ment during the next two months, but the average is
only 55 per cent. Of the mills reporting to this bank,
one-half have orders for delivery in from 60 to 90 days,
and almost one-quarter have orders for shipment later
than 90 days. The percentages of total orders on the
books for delivery during these two periods average 25
and 20, respectively.
Although some weavers that are equipped with box
looms report that all of their machinery is in opera
tion, the majority are running at from 60 to 70 per
cent of capacity. The curtailment, however, has not
been sufficient to prevent some accumulation of finished
goods, though manufacturers are making a strong effort
to avoid the danger of making up silk at present prices
to put into stock. Finished stocks range from moderate
to light, and supplies of raw material are light and are
decreasing. A third of the reporting firms have suffi
cient labor, but the remainder find both skilled and un
skilled labor to be scarce. In nearly all cases, wages
have been raised, and although it is difficult to express
a change in piece rates on a percentage basis, the ad
vance has been about 10 per cent.
Owing to the increased cost of raw materials, of labor,
and of dyeing, prices during the month have advanced.
But manufacturers complain that it is impossible to
obtain prices commensurate with the higher costs.
19
Moreover, buyers are seeking fabrics of lower quality.
Collections are fairly good, and are more prompt than
they were a year ago. But in the past month they have
become somewhat slower.
Because raw silk prices during the past month were
extremely high, having reached the highest level since
January, 1920, manufacturers of silk,goods
* silk™ are attemP^n^ t0 keep stocks at the lowest
possible working basis, and consequently the
demand for thrown silk is still dull. Mills in general
are buying to fill immediate requirements only, and as
a result throwsters report that orders on their books
are for delivery within sixty days. Severe competition
makes it almost impossible to advance throwing prices,
although costs for wages and materials are steadily
mounting. These factors are tending to reduce pro
duction schedules of throwsters, and as a result less
than half the spindles are in operation. Collections were
excellent during the preceding months, but are begin
ning to slow up perceptibly.
The interest of the silk trade is centered in the prob
able future trend of raw silk prices. Since mills have
refrained from buying in the hope that prices
Kat?lk would drop, the demand for raw silk has been
quiet. The bullish factors that now influence
the market are:
1. The visible stocks in Yokohama are small. On
May 15, these were reported by H. L. Gwalter to
amount to 18,000 bales.
2. Stocks in American warehouses fell from 39,436
bales on April 1 to 28,657 bales on May 1.
3. The present high prices of silk seem likely to
increase the cost of cocoons to Japanese filatures, and
this in turn would tend to raise quotations on newcrop silk.
Although the world’s production of silk last season was as large as
the pre-war output, It has failed to keep pace with the heavy
consumption, and the price is now about ISO per cent
higher than it was in 1912-1913
Sources—Silk Association of America, “Boston Evening Transcript”
4. Weavers will need silk to manufacture silk goods
for fall.
The elements in the present situation that are of a
bearish nature are the following:
1. Although the unsold stocks in Yokohama are low,
considerable supplies of the present crop are reported
to be available in Japanese filatures.
2. Since sales have been greatly diminished by the
high prices prevailing during the past month, there is
little likelihood of the present stocks being exhausted
before the new crop of silk is ready.
3. Consumers may refuse to buy hosiery and broad
silks priced on the basis of prevailing quotations in the
raw silk market.
The trend of current prices as compared with those
before the war is shown by the accompanying chart.
HOSIERY
Full-fashioned hosiery mills are for the most part
running at capacity. In some of them, all orders are
for shipment before the end of June, and no prices have
been named for delivery in the second-half of the year;
but in others, new quotations for July to December ship
ments have been made, and a considerable business has
been booked, although not as much as at this time last
year. On silk hosiery to retail at $2.00 per pair, prices
are either unchanged or increased, the increases rang
ing up to 4 per cent; on the more expensive lines, they
are up to 15 per cent higher.
Mills making seamless hosiery are operating on the
average at about 65 per cent of capacity, and with the
exception of some orders for wool hosiery or wool mix
tures for next autumn, nearly all orders are for ship
ment within sixty days, and prices are in most cases
unchanged. Some manufacturers, however, report an
advance in price, and a few have reduced quotations.
The largest demand in both the full-fashioned and seam
less trade is for silk hosiery for women, in red, green,
and nude, for early shipment.
Cotton yarns are much lower in price, and silk tram,
too, has eased off slightly; but prices on wool and wor
sted yarns hold firm. Labor continues to be scarce in
some localities, and a number of firms have increased
wages. Collections range from very good to slow.
Reports received from manufacturers in the Third
Federal Reserve District, tabulated on page 21, show that
during April, among firms selling to the wholesale trade,
production decreased 5.5 per cent, as compared with
March, and increased 6.4 per cent as compared with
April, 1922; and orders, largely because of the sales
made for July to December shipment, increased 32.0
per cent, as compared with March, but were 5.6 per
cent smaller than in April, 1922. In mills selling to
the retail trade, production in April was 9.0 per cent
less than in March and 15.2 per cent greater than in
April, 1922. Orders booked fell off 10.5 per cent as
20
compared with March, and increased 6.6 per cent as on April 30 were 16.5 per cent smaller than in March,
but 181.7 per cent larger than April, 1922. In winter
compared with April, 1922.
underwear the production increased 3.7 per cent as
compared with March, and decreased 17.1 per cent as
Conditions in the hosiery industry
compared with April, 1922. Unfilled orders on April
During the month of April
30 were 1.0 per cent less than in March and 171.4 per
cent greater than in April, 1922.
April, 1923, April, 1923,
In terms of dozens of pairs
compared with compared with
March, 1923 April, 1922
Conditions in the underwear industry
During the month of April
Firms selling to the wholesale
trade:
Number of reporting firms—33
Product manufactured during
month .......................................... — 5.5%
Finished product on hand at end
of month ..................................... — 1.8“
Orders booked during month___ +32.0 “
Cancellations received during
month .......................................... — 5.4 “
Shipments during m o nth............. — 1.2 “
Unfilled orders on hand at end
of m onth ................................................ + 5.4“
Firms selling to the retail
trade:
In terms of dozens
+ 6.4%
+21.6 “
■ - 5.6“
—72.5 “
+ 6.9 “
+45.0“
Number of reporting firms—12
Product manufactured during
month .......................................... — 9.0%
Finished product on hand at end
of month ............................................. — 4.4 “
Orders booked during month___ —10.5 “
Cancellations received during
month .................................................... —12.4 “
Shipments during month ............. —17.0“
Unfilled orders on hand at end
of m onth...................................... — 2.9 “
+15.2 “
—21.2 “
+ 6.6 “
+16.3 “
+ 9.1 “
+99.2 “
UNDERWEAR
The violent drop in the raw cotton market was re
flected in the prices of cotton yarns, which have declined
on an average of about 15 per cent during the past two
months. These changes have completely unsettled the
underwear market, and buying has come almost to a
standstill. The spring season is about over, and retail
sales have been smaller than was anticipated, because
of the unusually cool weather. Reports have been
received of requests by retailers to wholesalers to hold
back shipments of spring goods. Jobbers are showing
no interest in fall underwear; in fact, some cancella
tions and some requests to postpone delivery have been
received by manufacturers. Lines for next spring are
being prepared in some mills, but prices have not yet
been quoted, as manufacturers believe it is impossible
to make satisfactory prices until the market becomes
more stable. Collections are from fair to good.
Returns from manufacturers in the Third Federal
Reserve District, tabulated below, show that production
of summer underwear in April decreased .3 per cent
as compared with March, and 13.0 per cent as com
pared with April, 1922; and that unfilled orders on hand
April, 1923,_ April, 1923,
compared with compared with
March, 1923 April, 1922
Summer underwear
Number of reporting firms—12
Product manufactured during
month ..........................................
Finished product on hand at end
of month ....................................
Orders booked during month ----Cancellations received during
month ............... ..........................
^Shipments during m o nth .................
Unfilled orders on hand at end
of m onth ...............................................
Winter underwear
— .3%
— 13.0%
— 27.1 “
— 44.5 “
- 38.5 “
+ 62.9 “
—
—83.9 “
3.9 “
— 85.0 “
+ 1 6 .9 “
- 1 6 .5 “
+ 1 8 1 .7 “
+ 3.7%
— 17.1%
+ 4.3 “
— 35.1 “
0.0 “
+ 4 4 .7 “
+ 1 1 .1 “
+ 43.8 “
— 1 .0 “
+ 1 7 1 .4 “
Number of reporting firms—5
Product manufactured during
month ....................................................
Finished product on hand at end
of month .............................................
Orders booked during month ----Cancellations received during
month ...................................... : .
Shipments during m o nth .................
Unfilled orders on hand at end
of m onth ...............................................
21
FLOOR COVERINGS
Manufacturers of the principal weaves of carpets and
rugs, as stated last month, were in nearly every case
able to book all the yardage they desired to contract
for and in many cases were forced to divide their out
put pro-rata among their customers. Manufacturers
of Wiltons have now named their new prices, and in
a majority of cases these show advances of from 5 to
10 per cent; but a number of makers of wool Wiltons
have not changed their quotations. It is reported, how
ever, that some of these latter manufacturers will pro
duce more worsted and fewer wool Wiltons than they
have during the past season. It is reported also that
new Wilton looms are being added to the-equipment
of local mills and that in the near future a considerable
gain in yardage may be expected.
The accompanying chart shows that though importa
tions of carpets and rugs fell off sharply in 1919, in
1920 they were larger both in quantity and value than
during the years preceding 1919, and since then they
large gain in the quantity of imports in those years
Source—Department of Commerce
have continued to increase steadily. The years shown
are years ending June 30.
Some manufacturers who market their product
through salesmen and therefore do not dispose of their
entire season’s output at the opening, report a slight
decrease in new business and that the higher prices are
meeting with considerable resistance. Instances of
overbuying are so few as to be almost negligible, and
payments continue to be made promptly. Labor, both
skilled and unskilled, is in short supply, but up to the
present, mills have been able to secure sufficient to
maintain production. Wages in most parts of the dis
trict have risen during the past sixty days.
The accompanying chart shows the imports of carpet
IMPORTS OF CARPET WOOLS
M
S
)S
^
__
1920
■ ■
-
1922
19 21
____ __________
................
o
o
.
m
■in
0 s i _Ji
Chinese Empire
-1
1 nil
1
British East Indies
United kingdom
-
Argentina
The heavy demand for carpets and rugs which kept the m ills busy
throughout 1922 is reflected in the large gain in the importa
tions of carpet wools during that year
Source—National Association of Wool Manufacturers
wools from the largest foreign markets during the past
three years. Shipments from the United Kingdom are
largely composed of East India wools that have either
been trans-shipped at some British port or have been
purchased in the London market. The^ years shown
are years ending June 30.
Linoleum manufacturers report that production diffi
culties caused by the scarcity of labor are their chief
care at present, for the number of orders on hand is
large and the demand continues good, although-not so
urgent as in March. Some cancellations are reported.
Linseed oil, which for some months past has been ad
vancing, has now eased somewhat in price, and offerings
are freer. Collections are good.
FURNITURE
The majority of furniture manufacturers report that
the demand for their products is only fair and is prac
tically the same as in April. Since March, when pro
duction reached the highest point of the year, the call
for furniture has been rather light, and only those mills
that have large contracts for the furnishing of hotels,
clubs, hospitals, and apartment houses state that the
demand is good. Retailers have been purchasing very
cautiously, as this is between seasons, and increases in
price made by several manufacturers are meeting with
determined resistance. However, most of the factories
find that the present demand is better than that of May,
1922. The call for phonograph and radio cabinets is
good, but makers of kitchen and household cabinets
report a noticeable falling off in orders. The demand
for parlor, living room, dining room, and bed room
suits and other home furniture is only fair. Orders
for desks, chairs, and other office furniture are smaller
than they were in March, although since April the
demand has been steady. Production throughout this
district, however, continues at a high rate, and the aver
age of factory operations is about 80 per cent. About
90 per cent of the orders on the manufacturers’ books
are for prompt shipment, and only those firms that
have large hotel contracts have any considerable amount
of business for future delivery.
On account of higher costs of labor and raw mate
rials, several manufacturers advanced their prices by
from 5 to 10 per cent at the beginning of the month, but
the advance has not been general. The sharp resistance
to higher prices by many retailers and the present char
acter of the demand have probably prevented the move
ment from becoming widespread. Although lumber
prices have remained steady and are the same as in
April, varnishes, veneers and paints have gone up dur
ing the month. Plate glass prices, too, still show a
tendency to rise. One large manufacturer states that
the cost of materials used in the making of furniture is
now 110 per cent higher than the 1913 cost.
Stocks of finished furniture at the factories are mode
22
rate, and at many plants are increasing. The supplies
of raw materials held by manufacturers are likewise
moderate, but are decreasing, as nearly all are buying
conservatively.
Almost all factories, both in the cities and the smaller
towns, report a scarcity of skilled and unskilled labor.
The building trades and automobile body builders are
attracting some of the cabinet workers into other indus
tries. In order to hold their men, practically all of the
manufacturers in this district advanced wages from
5 to 15 per cent early in the month.
The general freight situation shows improvement
and is satisfactory, except to New England points, to
most of which embargoes are still in force. Shipments
to New England may be made only on permits and
consequently are frequently subject to long delays. Col
lections, in general, are fair and the same as in April.
LEATHER
Conditions in the shoe factories have changed but
little during the past month, and the slackening which
was then becoming evident has continued. A
Shoes fair number of novelty shoes for women have
been produced, but as the majority of orders
for these call for shipment before Memorial Day, the
deliveries by factories during June will be smaller. This,
however, is usual in June. The success which shoes
in bright colors have met has exceeded all expectations,
and although recent orders for them are reported by
some to be decreasing, others anticipate they will con
tinue to be the vogue during the early part of the sum
mer at least, and that then other colors somewhat more
subdued—such as beige, camel, and grey—will be
popular.
The sale of white shoes made of leather, although
fair, has thus far been somewhat retarded by the rush
for colors; and white canvas shoes for women have
sold very poorly. Many of the factories in New Eng
land that are usually burdened with orders for canvas
shoes up to July 4, are now making other lines because
of lack of orders.
A number of factories in this district report that
they have booked some business for July, August, and
September delivery, and that the orders on hand show
an increase over those of a month ago. But these
orders are, of course, in more staple lines for infants
and children. It is yet impossible to form any opinion
as to what will be the prevailing style for women for
next autumn, and therefore jobbers and retailers are
holding back, and the trade expects that the bulk of
such business will not be placed before July.
Production of shoes in this country, according to
figures issued by the Department of Commerce, was
larger in March than ever before. In that month, 34,355,833 pairs were made, bringing the production for
the first quarter of the year to 95,315,374 pairs. These
figures compare with 29,350,306 and 79,021,470 pairs
for the same periods of 1922.
Stocks of shoes in the hands of both jobbers and
retailers, perhaps as a result of this heavy production,
appear to be increasing, but they cannot be called bur
densome. The rapidity with which styles are changing,
however, tends to increase the stock of slow selling
lines.
A strike which has been declared by some of the
workers in the shoe factories in Brockton, Massachu
setts, will result in a considerable decrease in the pro
duction in that district.
Prices, for the most part are unchanged, but some
advices of small increases have been received. Collec
tions are in a number of instances reported as slower
than they were a month ago, but in the majority of
cases are said to be from fair to good. In the Third
Federal Reserve District, as shown in the following
table, production decreased 15.0 per cent as compared
with March, but increased 15.3 per cent as compared
with April, 1922. Orders on hand at the end of April
were 10.0 per cent larger than at the end of March, and
102.8 per cent larger than on April 30, 1922.
Conditions in the boot and shoe industry
Number of reporting firms—34
(In terms of pairs)
Product manufactured during month
Shipments during month ..............
Orders booked during month..........
Orders on hand at end of m onth. ..
Cancellations received during month
Stocks (unsold) on hand at end of
month ..............................................
Number of operatives on payroll...
April, 1923, April, 1923,
compared with compared with
March, 1923 April, 1922
—15.0%
—23.2 “
+27.6 “
+10.0 “
+69.4 “
+ 5.3 “
— 1.8“
+ 15.3%
+ .6 “
+ 50.8“
+102.8 “
+ 20.1 “
— 26.3 “
+ 5.6“
Except of extreme novelties, retailers appear to have
sufficient stocks, as wholesalers report that repeat orders
have been few. Unfortunately, the supply of the novel
ties called for are small in jobbers’ hands, and there
fore sales by them during May have decreased. From
the table on page 10 it will be seen that sales in April
decreased 31.5 per cent as compared with March, and
6.6 per cent as compared with April, 1922.
With the retail dealers, although some complain that
the unseasonably cool weather during May has retarded
business, sales have been increasing, and the demand
for bright colored shoes for women has so far exceeded
early expectations that stocks were found to be insuffi
cient and all available supplies in the factories or in
jobbers’ hands have been eagerly purchased.
As shown in the following table, sales in April de
creased 18.3 per cent as compared with March, and 17.5
per cent as compared with April, 1922. When con-
sidering these figures it must be remembered that in
1922 the bulk of the Easter purchases were made in
April and that in 1923 they were made in March. There
fore, to arrive at a fair comparison of the two years,
March and April should be thought of together.
SHOES AMD LEATHER
MILHOUS
PAIRS
40
32
Retail shoe trade
24
(In terms of dollars)
Net sales:
(a) April, 1923, as compared with March, 1923. —18.3%
(b) April, 1923, as compared with April, 1922. —17.5
(c) January 1 to April 30, 1923, as compared
with January 1 to April 30, 1922................ + 8.0
15
8
O
1922
2. Stocks (selling price):
(a) April, 1923, as compared with March, 1923. + 4 2 “
(b) April, 1923, as compared with April, 1922.. —11.3
3. Rate of turnover (times per year based on
cumulative period):
(a) January 1 to April 30, 1923...........................
(b) January 1 to April 30, 1922.........................
Number of stores reporting above items:
1................. 29
2 and 3..................26
The decrease in sales of leather which was noted
last month has continued, and although some reports
of a fair volume of sales have been reLeather ceived, the majority of the tanners are
experiencing a period of considerable dulness. Heavy leather sales are, if anything, more satis
factory than those of upper leathers. This is a time
of the year when shoe manufacturers are endeavoring
to secure their orders for next autumn, and as these
orders increase, the gain in business will be shown in
increasing leather sales.
Production of heavy leathers has changed but little,
and stocks are reported to be increasing. Belting butts
are not meeting with the active demand of the past few
months, and manufacturers of belts have an increased
stock of leather on hand. Shading of price by some
sellers of butts has failed to stimulate buying. The
finding trade continues dull, and even the sole leather
trade is feeling the development of the trade in novelty
shoes, and only certain lines are showing any activity.
Harness leather, especially in the middle west, is more
active, and some advances in price have been made.
Labor, both skilled and unskilled, is scarce in a number
of tanneries, and wages have in most cases been ad
vanced. The following chart shows that in the past
year the production of shoes, except for a period of
'
'
'
1923
An alm ost steady increase in shoe production has been accompanied
by a steady reduction in the stocks of sole leather
Source—Department of Commerce
seasonal decrease in the late spring and early summer
of 1922, has steadily increased, and that the stocks
of oak and union, backs, bends, and sides has
steadily decreased. Not all shoes, however, have leather
soles, nor are all the leather soles made from union and
oak, backs, bends, and sides; but both these exceptions
represent a comparatively small part of these industries.
In upper leathers the demand for bright colors in
kid and calf has continued to be the feature of the busi
ness. Recently, however, some tanners report a de
crease of orders in these lines and a tendency to change
to the more subdued shades of beige, champagne, camel,
and grey. Black kid, except in the low grades, and
black calf are not moving actively, and as the produc
tion continues unchanged, stocks continue to grow
larger. Brown calf in the lower grades and in the
lighter weights is in greater request, and brown kid,
especially in the medium grades, is also wanted. Prices
of kid are unchanged, but a slight advance in price has
been made by some tanners of calf skins.
Patent leather in the low grades and top grades is
selling freely, but the second grade, which is the largest
in quantity, is not active. Prices of patent leathers are
firm and in some cases higher.
Wages in nearly all the kid and calf tanneries in this
district were advanced 10 per cent during the month.
Sheep leathers are in good demand. Glove, hat, cha
mois, and lining leathers continue to be wanted, and
further price advances for them are recorded.
In March, consumption about kept pace with the
increased production, as is shown by the following table
of the changes during that month in the production and
stocks of the leading leathers.
rr
Production
during month
Back, bends and sides .....................
Belting butts ......................................
Offal, sole and belting ..................... •
Cattle side, u p p er...............................
Calf and kip ......................................
Goat and kid ......................................
Cabretta .............................................. }
.
* Production figures not separated.
+17.2%
+14.2 “
+ 6.7 “
+ 3.5 “
+ 3.4 “
* +17.2 “ {
Stock at end
of month
—12%
+1.6 “
—1.0 “
—1.3 “
+1.9 “
+ -4“
—4.1 “
Collections are reported as from fair to good.
The market for domestic hides has been quiet and
sales have been small. The expected advance on April
and May hides, because of their superior
Hides and quality, has not been realized. The Arskins
gentine hide market has been weak, and
although prices have at times rallied, the
trend appears to be downward.
Calf skins, on the contrary, have been quite active,
and a considerable number have been sold. The prices
of 18 cents for Chicago city skins and of 19 cents for
packer skins are firmly maintained. Goat skins have
been dull, but prices for most varieties remain about
the same as they were a month ago. Some activity is
reported in lots of European chevrettes and other skins
especially suitable for the production of colored kid.
Lots of such skins, if in this country, have been readily
disposed of at prices fully equal to those of previous
sales. Sheep skins continue to be in small supply, and •
prices are still rising. The advances have now carried
the quotations of some kinds to more than 250 per
cent of the price at the opening of 1922.
RUBBER
In 1923, tires have been produced at the highest
monthly rate ever known in the early part of the year.
If the output were to continue at this rate, this
Tires year’s total production would be over 11 mil
lion tires greater than the peak production of
last year, which was about 41 million tires.
The demand in March was good because of the 10
per cent advance in quotations that became effective
on April 1. But since that time it has slackened con
siderably. The outlook for the coming months is con
sidered good by manufacturers who sell to dealers only,
because as in the past the summer demand should in
crease after July. However, those who sell original
equipment for automobiles expect a slackening of orders
after the spring season has passed.
The accomp'anying chart shows the number of tires
produced per car during each of the last five years.
Since consumption figures are not available, the ratio
of tires produced to cars registered is the best indication
we have of the number of tires consumed each year
25
The number of tires produced per car in the United States fell from
4.5 in 1919 to 2.6 in 1921, but increased again in 1922. This large
decrease in 1921 is attributable to less mileage per car, shown
by the drop in gasoline consumption, to a heavy carryover
from 1920, and to an improvement in the quality of
tires
Sources—"National Petroleum Magazine," National Automobile
Chamber of Commerce'
by the average car. However, this ratio, which is shown
by the heavy black line, takes into account neither the
tires that are held in stock by dealers and manufac
turers, nor variations in the distance which the average
car may run in different years. In order to correct the
latter defect, the average consumption of gasoline per
car is indicated by the shaded area. By comparing the
consumption of tires and gasoline per car, the variations
in the mileage given by tires in different years may be
seen.
The demand for mechanical rubber goods during the
first quarter of 1923 has exceeded that of the same
. period in 1922. Although, in general, it
Mechanical -s stjjj fajr £or
tjme 0£ year> orders
®
have greatly diminished since February.
But many manufacturers of hose are working their
plants at night in an effort to make deliveries on orders
taken some months ago. Both steam and garden hose
are in request, but the call for belting has been disap
pointing. In mechanical goods factories as a whole;
operations average 85 per cent of capacity. The scar
city of labor that is felt by many plants has, in a few
cases, curtailed production. Although skilled help is
somewhat scarce, common labor is still more so. Wages
have been advanced about 10 per cent for skilled work
ers, and from 10 to 15 per cent for unskilled.
Of the orders now on the books, about 85 per cent
are scheduled for delivery in the next two months.
Much of this business was taken months ago, when
prices and costs were lower than they are at present.
Owing to the advance in crude rubber and cotton fab
rics since the first of the year, prices are tending up
ward, but no changes have occurred during the past
month. Keen competition in many lines has prevented
a price increase equivalent to the higher costs. Stocks
are light and are decreasing. Supplies of raw mate
rials are moderate, but reports conflict as to whether
they are increasing or decreasing.
Collections are fairly good, but not as prompt as
many manufacturers would desire. Although the same
as they were a month ago, they are much better than
they were last year.
A sharp decline in the crude rubber market during
May carried the price of First Latex Crepe to a point
more than 27 per cent below the highest
rubber fluota^on ^or t^ie year>37% cents per pound,
which was reached on January 23. The
latter was the culmination of the spectacular advance
which began in October, 1922, largely as a result of the
Stevenson restriction plan. The chief causes of the
decline were a lessening of demand and an increase of
supply. For the most part, the latter was caused by
the smuggling of rubber from the areas under British
control. However, the average price for the three
months of February, March, and April, was sufficiently
high to permit the release, after May 1, of 65 per cent
of the “standard” production in Ceylon and Malaya,
instead of the 60 per cent which had been released
previously.
As shown by the table below, the American imports
of crude rubber have been higher this year than in 1922.
American imports of crude and waste rubber *
In tons
1923
1922
January .......................................
February .....................................
March ..........................................
31,197 tons
24,220 “
33,916 “
21,867 tons
28,973 “
28,702 “
* Compiled by the Rubber Association of America.
PAPER
Although the demand for all grades of paper is still
good, many manufacturers report a marked decline in
the orders received during the month. This has been
most noticeable in the call for wrapping papers and tag
stocks, but the majority of the mills making these
grades are still operating at capacity on orders. Some
decrease has also occurred in the demand for magazine
and book papers, and the mills, which two months ago
were from five to six weeks behind in deliveries, are
now only from ten days to three weeks behind. Orders
for writing, ledger, and fine papers, too, are smaller
than they were a month ago, but the mills are still well
supplied with orders and are operating at close to capac
ity. Envelope manufacturers report that the call for
their products is well sustained and shows little change
since last month. They are operating at about 80 per
cent. Crepe towels and toilet tissues are in less request
than they were a month ago, but the demand for other
grades of tissues has improved. Converters of paper
state that the call for tablets, writing pads, stationery,
etc., is very good, particularly from schools. The de
mand for manila papers, building papers, building
boards, and card boards continues to be good, and mills
making these are operating at, or near to, capacity.
Boxboards, particularly news and chip, are in better
request than they were last month, and board mills are
operating at from 85 to 100 per cent. About 95 per
cent of the orders booked by paper mills are for delivery
within 60 days, as few buyers care to make commit
ments for beyond that period and manufacturers desire
to avoid any pyramiding of orders. Wholesalers state
that, in general, the demand is good but that there has
been a falling off in the call for wrapping, fine, and
book papers. Some cancellations of orders have been
noted by a few jobbers for the first time in many
months, and an air of caution pervades the trade.
Wholesalers report that practically no business is being
booked for future delivery and that paper consumers
are buying very conservatively.
A few fine and book-paper mills have advanced prices
from an eighth to a quarter cent per pound during the
month, but all advances have been confined to these
grades. Prices of wrapping, manila, tissue, crepe, and
other papers are firm and unchanged. Early in the
month news and chip board quotations were increased
$2.50 per ton, or Al/ 2 per cent; but container board,
straw board, and jute liner remain at the April levels.
Imported chemical pulps, particularly sulphite pulps,
have gone up, and are from 3 to 7 per cent higher
than they were a month ago. Domestic mechanical
pulp is now quoted at from $37.50 to $40.00 per ton,
or from 2j4 to 7 per cent less than on April 23.
Stocks of finished paper at the mills are reported
as being from light to moderate and are decreasing.
Supplies of raw materials are moderate, except at chip
and newsboard mills, where they are light. Chip and
newsboard plants are buying waste papers very con
servatively, because of the uncertainty of prices. Most
of the large users of chemical pulps have contracted
for supplies of these for from three to five months ahead.
Wholesalers’ stocks on hand are moderate and about
normal.
Unskilled labor is in scant supply at many mills,
both in country and city districts; and at some plants,
skilled labor likewise. A general wage advance of from
10 to 15 per cent has taken place at most mills through
out the district.
The freight situation is better than it has been for
months, as all embargoes, except to some New England
points, have been lifted. Manufacturers report collec
tions as being good and as unchanged since last month;
but wholesalers find them to be slower than in April
and only fair.
PAPER BOXES
In general, the demand for paper boxes is good and
is about the same as it was in April. Some manufac
turers report an increase in orders and some a decrease,
but the majority state that there has been no change
since last month. The hardware, auto accessory, elec
trical and radio supply, and food products industries
are still buying heavily; but the shirt, underwear, shoe,
and candy trades are purchasing only moderately. Spe
cialists in hosiery boxes report that the demand con
tinues to be fair and well sustained, and although not
so heavy as they desire, it is much better than it was a
year ago. One large maker of hosiery boxes states that
his April output was 25 per cent greater than that of
last April. Mailing tubes, fancy perfume, specialty, and
folding boxes continue in steady request, as has been
the case during the past three months. Although opera
tions vary considerably, they continue at a high rate and
in this district average about 80 per cent of capacity.
Makers of corrugated boxes and fibre shipping con
tainers report that the demand is good and slightly
greater than it was last month. However, they state
that all orders are for immediate shipment and that
buyers show no disposition to make contracts for the
future. In this branch of the industry production is
at about 85 per cent of capacity. Approximately 90
per cent of the orders booked by box manufacturers
are for prompt shipment, but some candy-box makers
have received considerable Christmas business.
Many manufacturers have advanced prices during
the month, because of rising production costs, the in
crease varying from 5 to 8 per cent. On the first of
the month, chip and newsboard prices were advanced
$2.50 per ton and they are now back at the March levels.
Strawboard, jute liner, and container board prices have
held very firm and are unchanged.
Finished stocks at the factories are light and are
increasing slightly. Manufacturers’ stocks of paper
board, glue, and other raw materials are moderate, but
are decreasing, as all box makers are buying cautiously
and for immediate needs only.
The majority of manufacturers report that both
skilled and unskilled labor is scarce, and on May 1 many
advanced wages from 5 to 15 per cent. Girl operatives
are especially scarce. The turnover of labor continues
to be heavy, and manufacturers complain that many of
their employees are taking one or two days off per
week. One large box maker states that for the past
two months he has never had more than two-thirds of
his force at work on Monday.
Transportation by rail shows improvement despite
heavy car loadings, and scarcely any complaints of ship
ping delays are now audible. Collections show no
change since last month and are reported as being from
fair to good.
SUGAR
The purchasing of raw sugars for prompt shipment
during this month has been relatively light for this time
of the year, and refiners have shown little
Raw
inclination to buy. On the other hand, holdsugar ers raw SUgar have not been anxious to
sell, and the spot market has held relatively firm. Early
in the month, when the boycotting movement of vari
ous women’s associations was first announced, and just
before the Department of Justice attempted to secure
a temporary injunction against the New York Sugar
Exchange, the prices of raw sugar fell. On May 4, a
small sale of Cuban raw for May delivery was made at
5ys cents, c & f, but only one sale was at this low level.
Prices soon rose to 6, 6*/g and 6)4 cents, c & f, Atlantic
ports, and some large sales were made at these prices.
Further advances in the price of Cubas have occurred,
and present offerings are being made at a range of
from 6)4 cents to 6)4 cents, c & f, for prompt ship
ment. Porto Rican sugars have sold at prices ranging
from 7.78 cents to 8.28 cents, delivered, the equivalent
of from 6 to 6)4 cents, c & f, for Cuban.
United Kingdom refiners bought 15,000 tons of raw
sugar in Cuba early in the month at 6.25 cents, f. o. b.,
but since then they have bought at prices ranging from
6.35 to 6.48 cents, f. o. b. However, their purchases
have been moderate. Canadian refiners bought a few
cargoes of Santo Domingan sugar at prices ranging
from 6 to 6)4 cents, c. i. f.
The grinding season in Porto Rico and Santo Do
mingo is reported as practically completed, and the
production of both islands is smaller than it was last
year. No official estimates of this year’s output, how
ever, are yet available, but the production at all of the
centrales which have closed was less than that of 1922.
In Cuba, too, the grinding season is drawing to a
close. A large number of centrales have already closed
because all of the available cane has been delivered to
the mills. Some, however, shut down before all of the
cane had been delivered, on account of the difficulty
of getting deliveries because of the heavy rains late last
month and early this month. Central Cunagua, which
closed on May 7, produced more sugar than ever before
in its history. Its output was 37,000 bags more than
was estimated last December, and 155,000 bags greater
than in 1922. Its 1923 production is reported as being
587,000 bags. Although all of the recognized authori
ties have reduced their estimates of the Cuban crop
from the first figure of about 4,000,000 tons to 3,700,000
or 3,500,000 tons, there is yet no certainty that the
lowest of these revised estimates may not be actually
exceeded.
27
Late in April, large quantities of refined sugar were
bought on deferred shipment contracts, but the buyers
have been very slow in making withdrawals. As a
result, stocks at the refineries have accumulated, and
all of the refiners have been pressing their customers
to take deliveries. This heavy accumulation of stocks
induced the refiners to make price concessions on
prompt shipment sales, and at various times during the
month they have sold at prices from 15 to 40 points
below their listed quotations.
In the closing days of April, quotations for fine
granulated at the refineries jumped to over ten cents
and varied from 10.05 to 10.25 cents per pound at the
different plants. But on May 3, under the heavy selling
pressure of sugars held by second hands, prices dropped,
and refiners soon revised their quotations to from 9.50
to 9.90 cents. Nearly all of the refiners now quote
9.90 cents for fine granulated, but two of the New York
producers quote 9.50 and 9.75 cents respectively.
Meltings for the first three weeks of the month at
the refineries at Baltimore, Boston, New York, and
Philadelphia were about 9 per cent smaller than for
the same period last year.
How great has become our dependence upon Cuba
as a source of supply for sugar, can be seen from the
following chart. In 1900 only about 290,000 tons of
raw sugar were imported from Cuba; in 1922 slightly
more than 4,000,000 tons came from that island.
SUGAR
Tons
5
4
3
2
1
O
1900 1905 1910 1915 1916 191T 1918 1919 1920 1921 1922
In 1922 our imports of raw sugar from Cuba alm ost equalled our entire
consumption of refined sugar in each of the three preceding
years. In 1922, Cuba supplied 67 per cent of the total
am ount of raw sugar used in this country, whereas
in 1900 it furnished only 12 per cent
Sources—Department of Commerce, “ Weekly Statistical Sugar Trade
Journal”
Meltings of sugar at Atlantic port refineries
Tons 2240 lbs.
April 27 to
May 18, 1923
April 28 to
May 19, 1922
The amount of raw sugar received at the ports of
Baltimore, Boston, New York, and Philadelphia during Total meltings ............................. 232,000 tons 254,000 tons
the first three weeks in May was considerably smaller
than the imports for the same period of last year. The
following data, compiled by the “American Sugar Bulle Export buying, particularly from second hands, has
tin,” reflect to a considerable degree the relative inactiv been heavier this month than in any month of the year.
ity prevailing in the spot market during the month.
But this is normally expected in May, and the foreign
purchases of refined sugar are not nearly as heavy as
they were last year. Italy and the United Kingdom
Receipts of raw sugar at Atlantic ports
have been the principal buyers in eastern markets.
Receipts (tons 2240 lbs.)
April 27 to
May 18, 1923
April 28 to
May 19, 1922
From Cuba ................................... 169,206 tons 226,039 tons
F rom P orto R i r o ............................... 40,245 “
30,081 “
F rom P hilippine Islands .............. 11,534 “
8,960 “
774 “
T otal receipts ................................. 221,759 “
265,080 “
Refiners report that the demand for refined sugars
has been considerably below normal for this time of
_ the year. The unseasonably cool weather,
Kenned ^ housewives’boycott, and the rather heavy
sugar 0hferings of refined sugar from second hands
undoubtedly curtailed the demand at the refineries.
However, the refiners are very doubtful whether the
comparatively light buying has been due to much of a
decrease in consumption, and are of opinion that the
unfavorable weather has merely deferred purchases.
28
TOBACCO
On the whole, the demand for cigars is fairly good
and shows little change from that of April. Usually
the month of May is the beginning of the
Cigars and active season in the cigar industry, but
cigaret es nearjy ap manufacturers report that buy
ing this month, although somewhat heavier than it was
a year ago, has not been up to expectations. Many
makers are inclined to believe that retailers are rather
heavily stocked up and for this reason have deferred
purchasing until their shelves become depleted. The
large manufacturers of the better grades of cigars,
which retail at from 81-3 to 15 cents each, find the
demand to be good and are operating at close to capac
ity. The call for Class B and Class A cigars, however,
is only fair, and both large and small manufacturers
report that it is little if any greater than it was a year
ago. The factories making these classes are running
at an average of 80 per cent of capacity. Practically
all of the orders booked are for prompt shipment, less
than 5 per cent being for delivery beyond 60 days.
Manufacturers of Turkish cigarettes report that the
demand is fair and much the same as in previous months
of this year; but it is considerably better than it was a
year ago. Production of Turkish cigarettes is at about
60 per cent of capacity. The call for American cigar
ettes continues to be good, and production is well above
85 per cent of capacity. Severe price cutting in retail
stores is on the decline. Manufacturers of scrap and
chewing tobaccos report that the demand is only fair,
and some even characterize it as poor. Production in
the tobacco factories varies from 30 to 90 per cent of
capacity.
The following chart, based upon sales of internal
revenue stamps, shows that the output of large cigars
and small cigarettes in April, 1923, despite the dulness prevailing early in that month was greater than in
April, 1922.
PRODUCTION OF CIGARS AND CIGARETTES
Is
(Idrg'e)
C i q'a ns
■ ■
A p ril, 1922
A p ril, 1923
Cigarettes
t s m o ll)
5 ,0 0 0
400
(5 < or less) (5i t t o 6t) (6:H + o 154)
t
The total production of large cigars in April was 6 per cent greater than
in April, 1922, but 8 per cent smaller than in March of this year.
Cigarette output in April was 6 per cent less than in March,
but 36 per cent larger than in April, 1922
Source—Collector ol Internal Revenue
In the closing days of April one of the largest manu
facturers of cigars announced an increase of $1.00 per
thousand on their Class B brands, but the other cigar
makers in this district have not followed this example.
In general, prices of cigars are firm and unchanged.
Cigarette prices, too, are firm. Tobacco leaf prices are
exceedingly steady, and as each new crop comes into
the market, it ie quickly bought up at prices well above
those of a year ago.
At the majority of factories, the stocks of cigars are
moderate and are again increasing, but a few manufac
turers report that their finished stocks are light. Some
cigar makers are operating on order only and are thus
keeping finished stocks low. Supplies of tobacco leaf
at most factories are moderate and are increasing, as
many packings of both foreign and domestic leaf are
now being bought by manufacturers.
The supply of skilled operatives at most plants is
sufficient, but a scarcity of unskilled workers is noted.
In general, wage scales for skilled workers are un
changed, but several manufacturers have advanced their
rates of pay for unskilled labor from 10 to 20 per cent.
To some points in New England, manufacturers are
still resorting to express shipments, because of embar
goes on cigars via freight; but the general transporta
tion condition is improving. Collections are slower than
they were a month ago, and the majority of firms report
that they are only fair.
With the exception of Sumatra leaf and the poolcontrolled Wisconsin and Connecticut tobaccos, purchases of tobacco leaf have been light dur* leafC°
month. The Lancaster market has
’*u been very inactive, but packers report that
this is to be expected at this time of the year, as the
1921 crop has practically disappeared from the market,
and 1922 packings are not yet completed. A few
large factors made some purchases of 1922 Pennsyl
vania packed wrappers at from 28 to 30 cents per pound
in the middle of the month. The 1922 Pennsylvania
fillers in the bundle have been practically absorbed at
prices ranging from 5^2 to 8 cents per pound.
Dealers report that there is a scarcity of good Wis
consin and Connecticut binders because of the short
crop in those states last year, but they believe that there
will be enough to go around. Ohio, Wisconsin, and
Connecticut tobaccos are fully 25 per cent higher in
price than they were a year ago, and although pool
control of the Wisconsin and Connecticut crops may
have caused some of the increase, a general short crop
last year is chiefly responsible.
Manufacturers have made large purchases of Su
matra from- New York dealers and brokers during the
month at record prices. The fancy grades of Sumatra
wrapper are commanding prices ranging from $8.00
to $13.00 per pound. The quality of this year’s Sumatra
tobacco is reportedly dealers to be as good as that of
any crop ever imported.
American packers and dealers have been active buy
ers in Porto Rico, and growers on the island are quickly
disposing of their crop. Those districts which last year
were selling their tobacco at from 28 to 30 cents per
pound are this year receiving 35 and 36 cents, and
prices show no tendency to soften. The outlook for
Porto Rican tobacco growers is brighter than ever be
fore, and already forecasts of a bigger acreage of the
next crop are being made.
29
AGRICULTURE
Condition and estimated yield of some important crops
Condition on May 1
(per cent of normal)
C rop
C rop
»
H
W inter
wheat
Pennsylvania (avr.
11 counties).......
New Je rse y ..........
Delaware ..............
Estimated yield
(1922=100%)
Rye
84
84
89
88
90
90
ay
Alfalfa
Timothy
90
82
83
91
82
83
89
82
83
Asparagus
Straw-
90
90
80-90
Clover
108
120
Apples
Peaches
Pears
118
115
105
No data yet available
150
120
100
riums
100
100
in all three states will in all likelihood be lower than it
wras last year and than the ten-year average.
Practically all of the early crops are now planted,
and reports from agricultural bureaus indicate that in
nearly all parts of the district the acreage of truck and
other money crops will be from 5 to 10 per cent smaller
than last year’s. On account of the general scarcity of
farm labor, the majority of farmers are cutting down
their plantings and leaving some of their fields idle
or for use as pasturage. A few county agents, espe
cially those in important industrial and manufacturing
regions, state that farm labor is even more scarce than
it was during the war. Undoubtedly labor is the decid
ing factor in reduction of acreages, as the farmers
believe that good prices for farm products are in
prospect. Practically the only important crop for which
the acreage will be reduced solely because of low prices,
will be the potato crop. Last year most of the bumper
crop was sold at prices below the cost of production, and
for this reason many farmers will decrease their plant
ings. As the chart on page 31 shows, the prices paid to
producers for potatoes almost invariably determine the
acreage planted the next year. When prices are low at
harvest time, the acreage planted the next year is
smaller; but when prices are high, the acreage is in
creased.
In Pennsylvania, about 65 per cent of the steers fat
tened during the winter have been marketed, and the
Continued cool weather in the first half of the month
further retarded the early crops and the setting of fruit
in many parts of the district. Reports from agricultural
agencies state that all crops are from ten to twenty
days behind their normal development at this time of
the year. Fortunately, except in a few of the moun
tainous counties, there have been no killing frosts, and
a much larger fruit crop than was harvested last year
is in prospect for 1923. The spring thus far has been
rather dry, and as a result the condition of hay and
grain crops and pasture lands is only from 80 to 90 per
cent of normal. The Department of Agriculture esti
mates the acreage of winter wheat to be harvested in
Pennsylvania, New Jersey, and Delaware as being 5
or 6 per cent less than that of last year. The estimated
production of winter wheat is considerably lower than
the output of 1922 and than the ten-year average. The
acreage planted to rye is slightly larger than it was last
year, but the indicated yield per acre is smaller than
that of 1922 and a smaller crop of this grain is in pros
pect. The above table, based upon reports from
county agents and state departments of agriculture,
shows the condition and estimated yields of the various
crops.
From the condition on May 1 the U. S. Department
of Agriculture estimates the yield of winter wheat and
rye in 1923 will be as shown in the table below.
It will be seen that the production of winter grains
Estimated yield of winter wheat and rye
W in t e r W h e a t
( y ie ld in b u s h e ls )
1922
10 y e a r
a v e ra g e
1923
1922
10 y e a r
average
25,234,000
1.540.000
1.766.000
24,311,278
1.555.000
1.838.000
3.550.000
1.141.000
71,000
3.740.000
1.159.000
70,000
4,233,400
1,213,000
32,000
1923
Pennsylvania .............................................................. 21,109,000
New Jersey .................................................................... 1,288,000
Delaware ....................................................................... 1,589,000
R ye
(y ie ld in b u s h e ls )
30
balance will be sold to butchers and packers before the
close of next month. The general condition of livestock
on May 1 throughout the district was only one per cent
below the average condition on May 1 in the past ten
years. Many farm animals, however, appeared thin and
scraggy, because of short pastures and the scarcity and
high price of feeds. The one-cent per quart increase in
the price of milk, which the dairymen serving the Phila
delphia district secured on May 1, will have a very
beneficial effect on the dairy industry of the district.
Dairymen now have additional stimulus to improve their
herds, feed their cows better, and produce more milk.
Several of the county agents report that up to the end
of April many farmers were selling their cows to
butchers, because high prices for feed were depriving
them of profits, but this movement has now come to a
halt.
The crop outlook in this district at the beginning of
the growing season has seldom been better. The scar
city of farm labor is the only disconcerting feature of
the present agricultural outlook.
The acreage planted to potatoes Is generally determined by the average
price received by producers for the crop of the preceding season.
If the average price is higher than in the previous year the
plantings made the next year are increased, or, if lower,
they are decreased. The years 1918 and 1922 have been
the only exceptions to this rule during the past
decade
Source—Department of Agriculture
This business report will be sent regularly without charge to any address upon request
31
HOW THE BANK RESERVES OF THE RESERVE SYSTEM AFFECT THE
AVERAGE BANK DEPOSITOR
The man who has money in a bank has always been
interested in the reserve the bank carries, because it is
these reserve funds that the bank depends upon to meet
the ordinary deposit withdrawals that occur day by day
in the banking business. The plan provided by the
Federal Reserve Act for the treatment of these reserves
should be even more interesting to the bank depositor,
because it not only provides for a custodian of these
reserves but also sets up machinery through which cer
tain classes of a bank’s investments can be turned into
currency when additional funds are needed to repay
depositors.
Just how this reserve plan works out can be consid
ered in the case of the average country bank. This
bank receives the deposits of the community and may
pay the depositors a certain rate of interest on their
money, depending on the terms under which it was de
posited. Then the bank will have to earn this interest
by loaning or investing a sufficient portion of these
funds. In making these investments, the banker will
bear in mind, among other things, the necessity of being
in a position to repay deposits as they are demanded by
his customers. For this reason the banker keeps cer
tain funds uninvested as a reserve, but this reserve is a
relatively small part of the total amount of deposits be
cause only a small number of depositors are likely to
make withdrawals at any one time.
One of the functions of public service assigned to
the Federal reserve banks by the Federal Reserve Act
is that they serve as custodian of the reserves of mem
ber banks; this is to make these reserves true reserves,
as in view of banking experience in the leading coun
tries of the world, it has been considered wise that the
reserves be held in the Federal reserve bank rather
than in the vaults of the banks to which they belong.
These member banks have resources comprising
about 70 per cent of the total banking resources of the
United States, exclusive of mutual savings and private
32
banks, although they are only about one-third of the
total number of banks in the United States. All national
banks must be members of the Federal Reserve System,
and state banks are allowed to become members upon
compliance with the requirements placed upon the
national banks.
The reserves carried by member banks in the Federal
Reserve banks are over 1J4 billion dollars. No interest
is paid on these deposits, and so the Federal reserve
banks can hold them uninvested, if they wish, as true
reserves and are not forced to invest them merely for
the purpose of making earnings. At the present time
the Federal reserve banks hold gold reserves amount
ing to considerably more than the total amount of mem
ber bank reserves on deposit. The Federal reserve
banks themselves are required to set aside in gold or
lawful money in the United States an amount equal to
35 per cent of the deposits from member banks.
After the reserve against these reserve deposits has
been provided for, the Federal reserve banks still have
a large amount of gold that is available as partial secur
ity for the issuance of Federal reserve notes. The
twelve Federal reserve banks are the only institutions
in the United States, which can issue currency to mem
ber banks in exchange for certain of their self-liquidat
ing loans and investments. Thus, a bank belonging to
the Federal Reserve System, which has exhausted its
cash on hand and depleted its reserve, can apply to its
Federal reserve bank for currency in exchange for
such of its paper as is eligible for rediscount at the
Federal reserve bank. This makes it possible for a
bank to turn its assets into currency to repay depositors,
without depending upon the condition of the investment
and money market as in the old days before we had
the Federal Reserve System. In this way, the plan
provided by the Federal Reserve Act for holding
bank reserves has worked to the benefit of the bank
depositor.
@FedFRASER