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BUSINESS AND FINANCIAL C ON D ITIO NS THIRD FEDERAL PHILADELPHIA IN THE RESERVE DISTRICT SEPTEMBER I, 1922 By RICHARD L. AUSTIN, Federal Reserve Agent and Chairman FEDERAL RESERVE BANK of PHILADELPHIA GENERAL SUMMARY CONTENTS For summary of Federal Reserve Board on business conditions throughout the United States, see pink slip inserted in this report PAGE Agriculture .............................................................................................. 30 Bankers’ acceptances............................................................................. ' Building materials ............................................................................... 12 Bricks ........................................................................................................ 13 Canned goods, w holesale.................................................................... 10 Cigars ........................................................................................................ 29 Coal, anthracite ..................................................................................... If Coal, bituminous ................................................................................... 13 Coke .......................................................................................................... 13 Commercial paper ................................................................................. 6 Cotton g o ods............................................................................................ 18 Cottor., r a w .............................................................................................. 16 Cotton y a rn s ............................................................................................ 18 Drugs, wholesale ................................................................................... 8 Dry goods, wholesale ........................................................................... 9 Electrical supplies ................................................................................. 14 Financial conditions ............................................................................. 5 23 Floor coverings .................................. Foreign exchange................................................................................... ^ Groceries, wholesale ............................................................................. 10 Hardware, w holesale............................................................................. 9 Hides and sk in s..................................................................................... 25 Hosiery .................................................................................................... 22 Iron and steel ....................................................................................... 10 Leather .................................................................................................... 24 Lumber .................................................................................................... 13 P a in t.......................................................................................................... 14 Paper ........................................................................................................ 25 Paper b o x es.............................................................................................. 26 Retail tr a d e .............................................................................................. 7 Rubber, mechanical go o d s.................................................................. 26 Rubber, raw ............................................................................................ 28 Rubber, tire 9 ................................................................. 26 Savings deposits ................................................................................... 6 Securities ................................................................................................ 6 Shoes ........................................................................................................ 23 Silk g o o d s................................................................................................ 20 Silk, raw .................................................................................................. 21 Silk, th ro w n ............................................................................................ 21 Steel .......................................................................................................... 10 Tobacco l e a f ............................................................................................ 30 Underwear .................................... 22 Wholesale tr a d e ..................................................................................... 8 Wool, r a w ................................................................................................ 20 Woolen goods and worsted g o o d s................................................... 19 Woolen yam s and worsted y a rn s ................................................... 19 M ID-SUM M ER influences, combined with the cumulative effects of the long drawn out coal and railway strikes, have succeeded in temporarily checking industrial improvement. Howev’er, business during August has been moderately active, and almost none of the gains heretofore made have been lost. Underlying conditions undoubtedly continue to be sound. That so little recession has occurred at a time when decreasing activity is nor mally expected and industry is confronted with the grave production difficulties and price uncertainties caused by the labor controversies, is conclusive evi dence of this fact. The coal strike has become a matter of serious con cern in recent weeks, so serious indeed that several of the smaller public utilities on a number of occasions have been on the verge of shutting down. The larger utilities, too, have been hard pressed for fuel, and several have resorted to the importation of British coal to assure their operations. Industrial firms have not been so adversely affected as this, but they also report much difficulty in replenishing their stocks, which in many cases are sufficient for only one or two weeks’ operations. At the present writing miners in the Ohio fields have returned to work, as a result of the agreement reached at the Cleveland Con ference on August 15. But even if the strikes in other bituminous fields are settled in the near future, industrial firms will not benefit immediately, as the rationing plan recently adopted by the government places such firms fourth and fifth on the priorities list. Moreover, the railway situation is such that there may be considerable delay in moving coal when mining operations are resumed. It is certain, how ever, that an early end of the bituminous strike will prevent the coal famine that threatens. Anthracite operators and miners opened negotiations in Phila delphia on August 17 with a view to ending their controversy, but the conference was abruptly termin- SYNOPSIS OF BUSINESS CONDITIONS THIRD FEDERAL RESERVE DISTRICT R aw material or merchandise situation F inished P rices B usiness D emand S tocks S upply P rice Easily obtainable, Firm Higher Bricks Very light Excellent except coal Peas light— Firm Canned goods Firm Fair others normal Normal Firm Cigars Normal Adequate Unchanged Good Practically Coal, anthracite Firm Excellent none Slightly lower Coal, bituminous Very low Excellent Firm Coke Excellent Low Scarce Lower Firm Cotton goods Poor Normal Firm Plentiful Cotton yarns Firm Poor Light Long staple scarce Higher Drugs, wholesale Unchanged Poor Light Some are scarce Unchanged Dry goods, wholesale Fair but decreased Firm Heavier Firm Plentiful Electrical supplies Firm Fair Easily obtainable Firm Light Floor coverings Excellent Firm Firm Sufficient Light Few changes; Light but Groceries, wholesale Fair but decreased sugar higher increasing Easily obtainable Unchanged Normal, except Hardware, wholesale Good Higher Normal iron and steel Firm scarcer Hosiery, Firm Normal Easily obtainable Unchanged Fair full-fashioned Easily obtainable Unchanged Hosiery, seamless Weaker Poor Normal Iron and steel Increasing Good Higher Low Scarce Fair Heavy but Leather belting Higher Plentiful and improving Higher decreasing Heavy but Higher Good Higher Moderate Leather, heavy decreasing Higher Good Normal Normal Higher Leather, upper Higher Good Light Lumber, building Normal Higher Normal and Good Firm Easily obtainable Firm Paint increasing and Light Firm to higher Normal Good Paper Firm decreasing Increasing Good Low Paper boxes Advancing Light Rubber, Unchanged Decreased Plentiful Low mechanical goods Fair Lower Normal Good Rubber tires Plentiful Low Firm Normal Shoes, manufacture Fair ‘Adequate Higher Normal Firm Fair Shoes, retail Easily obtainable Firm Heavy but Unchanged Silk Poor Light Lower decreasing Unchanged Normal Tobacco Good Easily obtainable Advancing Underwear, Unchanged Normal Fair Easily obtainable Firm heavy weight Underwear, Firm Normal Fair Easily obtainable Firm light weight Woolen goods Fair Higher Normal Firm Plentiful Worsted goods Fair Higher Normal Firm Plentiful Woolen yarns Fair Higher Light Firm Plentiful Worsted yarns Poor Higher Light Firm Plentiful* 2 Collections Good Fair Fair Fair Fair Fairly good Fairly good Fair Slow Fair Good Slower Fair Fair Fair Fair Good Good Good Fair Fair Fair Fair __ Fair and improved^ Fair and improved^ Fair __ Fair — Fair F a i r ___ Fair Fair Improved___ Improved___ Fair — Fair atecl on the 22d. During this time, mining continued to be at a standstill. In fact, with the exception of a few thousand tons of steam sizes dredged from the rivers, there has been no production since April i. Furthermore, stocks of anthracite are practically nil, and since five months’ production is already lost, the outlook for the coming winter is far from bright. This is especially true with respect to the northwest, for coal is shipped to that region through the lake ports and these are closed very early. Production difficulties have continued to feature the iron and steel situation. The scarcity of coal and coke, the delayed shipments, and the impossibility in many quarters of securing skilled labor, have all combined to retard operations. The daily average of steel ingot and pig iron production fell off during July, and recent reports of the number of blast furnaces in operation indicate that the figures will show a further decrease for the month of August. The unfilled orders of the United States Steel Corp oration increased during July, and the total at the end of the month, 5,776,161 tons, was the highest since April, 1921. During August, practically all manufacturing have reported an increase in demand, but much of this is undoubtedly the result of con sumers, having placed orders with several manu facturers, because of the inability of some producers to make deliveries. Quotations have risen as a result of increased costs, but there has been no sharp advance in prices, and they by no means reflect the full increase in the cost of coal and coke. The building industry is perhaps the most active °f all at this time. Construction of houses still pre dominates, but the number of office buildings being erected, especially in Philadelphia, is large. Building Material manufacturers report a slight falling off in demand, but this is seasonal, since orders for opera t e s under construction were placed some months ago. Lumber sales are smaller, but prices have advanced slightly, largely because the supply has been diminished by embargoes on shipments from southern Points. Paint manufacturers also report a decline ln orders, but prices are unchanged. The call for bricks, however, has continued exceptionally large, but production has decreased because of coal scarcity. Many plants in this district have been forced to cease operations, and the majority of those still producing sufficient coal for little more than two weeks. Fhe present demand for bricks is so good that manu facturers could dispose of their capacity production. Although textile manufacturers are also conr°nted with production difficulties, they have been less embarrassed than others, because of the small demand. Cotton goods manufacturers report no change in the volume of business as compared with last month. Business is seasonally dull, and the same is true in cotton yarns. In fact, the call for yarns has fallen off slightly since last month, but it is about equal to that of this time last year. Much of the hesitancy in buying is attributed to the fluctuating raw cotton market, the uncertain foreign situation, and the strikes. The woolen industry, too, reports no improvement in business. Woolen and worsted goods are selling slowly, and there has been little business in yarns. The raw wool market has been inactive. In spite of this, however, prices have softened but little, for the statistical position of the raw wool market is strong. Broad silk manu facturers also report no gain, many in fact stating that the demand has declined somewhat since July 15. During the first two weeks of July mill sales in creased, reflecting the good business done by jobbers during the spring and early summer months, and it was expected that the volume of orders received by manufacturers would continue to expand. The set back, therefore, has been especially discouraging to producers. The demand for thrown silks has de clined, but is reported to be better than that of August, 1921. Crepe yarns alone are moderately active. The raw silk market too is dull. This is caused not only by the poor demand for manu factured products, but by the promise of a larger crop in Japan. Hosiery manufacturers report no improvement in business, and operations in several plants have been stopped owing to the lack of orders. However, those mills that succeeded in booking a large volume of orders for the heather and silk mixtures for the coming fall are operating at very close to capacity. No further orders are being received at this time, as jobbers and retailers are desirous of noting the movement of these goods before re-ordering. In the underwear industry some business has been done in the heavy weights for fall, but most of this busi ness was placed some months ago. Sales of spring underwear are slow at this time, although consider able business was placed at the openings late in July. The carpet and rug industry is alone among the textiles in reporting a continuance of active demand. The call for the lower grades, which was small in July, has increased, and that for the better qualities has continued as good as during that month. Most grades are completely sold at this time, and plants are being operated at very near to capacity. There have been but few reports of the inability to secure skilled labor. However, two plants report strikes. The shoe industry has continued to receive a fair volume of orders, confined almost exclusively, how ever, to early fall delivery. Shoe plants in this district are operating at about 65 per cent of capacity, and except for the inability to secure skilled workers for the fitting rooms, no labor difficulty is reported. This is in sharp contrast with the situation in other shoe producing sections, where strikes have been in progress for many months. The leather markets have continued very active. Prices are advancing, and in fear of still higher quotations, shoe manufacturers are laying in supplies of leather. Belting leathers, too, are selling well. The hide and skin markets are very strong. There is a decided scarcity of kid skins, and hides likewise are in small supply. As a result, prices of both are higher. The paper industry has been most adversely af fected by the coal situation. The demand was very good for a number of months, but it has fallen off somewhat, owing to the uncertainty as to prices. Several manufacturers, indeed, have withdrawn their price lists and are only accepting orders subject to the quotation prevailing at the date of shipment. The coal item is a very large one in the manufacture of paper, and, with prices advancing steadily and with the supply so doubtful, this action has become necessary. Paper box manufacturers report that the demand has been about equal to that in July, but a few of the larger plants state that there has been im provement. As a whole, it may be said the demand for boxes is good, and, with the approach of the holiday season, is gaining. Manufacturers of the nationally advertised brands of cigars report a steady improvement in demand and an increase in production, but the smaller firms report only a slight betterment. Cigar prices are un changed. The only labor difficulty being experienced by cigar manufacturers is a scarcity of skilled wrap pers in many of the manufacturing sections. Agricultural conditions throughout the district have been good, although in several Pennsylvania counties the need of rain to mature potato and fruit crops is reported. For the first time in many months the wholesale commodity price index numbers of the various agencies compiling such data have not Commodity jn agreement. The Dun’s index prices number, published as of August 1, de clined from 173.743 to 173.558, and the Bradstreet number, from 12.1069 to 12.0688. The weekly in dex number of twelve basic commodities, compiled by the Federal Reserve Bank of New York, averaged 140.7 in June and 140.9 in July. For the week ending August 12 the figure was 137.7. The revised index numbers of the Bureau of Labor Statistics, however, advanced sharply during July, the figure for that month being 155, as compared with 150 in June. The following table gives the Bureau of Labor index numbers for the various commodity groups for the month of July and indicates their percentage of change since July, 1921, and May and June, 1922 : INDEX NUM BERS OF W HOLESALE PRICES, BY GROUPS OF COMMODITIES 1913=100 July, 1922 Farm products........................ Foods ........................................ Cloths and clothing............... Fuel and lighting................... Metals and metal products.. Building materials ............... Chemicals and drugs............ House-furnishing goods .. Miscellaneous ........................ All commodities ..................... 135 142 180 254 121 170 121 173 114 155 Percentage of change since May, June, July, 1921 1922 1922 + 1 3 .4 + 2.3 + 3.1 + 2.9 + 1.4 + 3 *7 + 2.9 + .6 4* + 3 6 .6 + 1 7 .6 + 1 2 .9 + 1.7 + .8 _ 2.4 + 6.3 + 1.8 + 6.3 _ 62 — .8 — .8 — 1.7 — 1.7 — 3.9 0.0 — 7.3 — 1.7 + 4.7 + 3.3 + 9.9 It will be seen that the largest advance was in the fuel and lighting group, the increase of 12.9 per cent being the result of the coal strike. The effect of the strike situation on this group is clearly evident in the accompanying chart. The rise in the number of this group has been 33 per cent since April IOther important groups to show increases are building materials and farm products. The re lationship between each of these groups and the all-commodity number is also depicted in the chart. 4 It is readily seen that since April of 1920 the purchasing power of farm products has been below that of either of the other groups. Considerable recovery in this respect has been made since June of last year. Building material and fuel and lighting prices have been and continue to be above the all-com modity level. In the table headed “ Financial Statistics” some of the more important figures bearing upon the mone tary situation are presented. Further light on the trends of member bank loans, investments and de posits may be gleaned from the chart which accom panies this article. FINANCIAL CONDITIONS Further liquidation of bank loans during the past month is indicated by the loan and discount figures of the reporting member banks, but it is evident to those who have been following these figures that this tendency has lost much of the momentum that it pos sessed during 1921 and the first few months of 1922. Weekly changes in these loans and discounts are now not so extended, nor are they uniformly in the direction of lower totals, but, on the contrary, take an upward swing at short intervals. If we confine ourselves to one item— “ all other loans and dis counts”— which is mainly inclusive of accommoda tions to business and commerce we find an increase in the past month, and for the six months ending August 9, a decrease of only 261 millions of dollars, as compared with 715 millions in the preceding half year. Better business conditions have enabled many business men to pay off their debts and set their houses in order financially, but they still hesitate to increase the total of their short-dated debt, either by mcreasing their borrowings from the banks or by ^suing commercial paper in larger quantities. The member banks continue to accumulate large amounts of securities, their holdings having in creased 168 millions of dollars during the last month. But almost all of this is accounted for by the receipt °I the new issue of certificates of indebtedness bearlng the date of August 1. In the last six months, fhe amount of securities owned has increased by 774 millions of dollars. The condition of the Federal reserve banks does n°t show any great change from that of a month a&°, apart from a gain in the reserve ratio from 77.8 to 80.2 per cent. Bills discounted decreased from 443 to 382 millions, and deposits from 1,942 to 1,847 ^dlions. An increase in Federal reserve note circuktion, from 2,132 to 2.142 millions, and in total re a v e s from 3,169 to 3,198 millions, is also reported. Bates for commercial paper and bankers’ acceptances still range from 4 to 4*4 per cent and from 3 *° 334 per cent, respectively, for bills of the shorter maturities. The supply of both classes of paper is n<^t large, and purchases by banks in the Third Dis trict are relatively small. FINANCIAL STATISTICS (000’s omitted) Federal Reserve System: Purchased bills ........................... U. S. securities............................ Total deposits ............................. F ederal reserve notes................ Total reserves............................. Reserve ratio ............................. Reporting member banks: Loans and discounts: Sec’d by U. S. securities----Sec’d by other securities.. .. All other .................................. Total loans .......................... Investments: U. S. securities........................ Other securities...................... Total investments ............. Total deposits ......................... Two months ago Latest week Month ago $382 150 489 1,847 2,142 3,198 802% $443 149 542 1,942 2,132 3,169 77.8% $414 124 629 1,929 2,123 3,136 77.4% 263 3,491 7,039 271 3,537 7,031 313 3,502 7,072 10,793 10,839 10,887 2,246 2,294 2,081 2291 1,961 2,274 4,540 14,748 4,372 14,783 4235 14,609 Money rates: Fed. Res. bank discount rates: Boston ....................................... 4 % 4 % 454% New York ................................. 4 “ 4 “ 454 “ Philadelphia ............................. 454 “ 4y2 “ 454 “ Chicago ..................................... 454 “ 454 “ 4V2 “ Commercial paper....................... 4-454 “ 4-4 “ 454-454 “ Bankers’ acceptances ................. 3-3 Ms “ 3-354 “ 354-354 “ 3 “ Call money renewals................ 3>4“ 4 “ Decreasing loans and increasing investm ents indicate lessened dem and for m oney from business interests. Source—Federal Reserve Board. 5 Security prices, with the exception of prices on Liberty bonds, moved upward again during the past month, although trading continued to Securities be in moderate volume. The average of 4 Liberty bonds reached a high point of $101.28 on July 24, but since then has re acted. Railroad stocks again manifested greater strength than any other group. A comparison of security prices on August 19 with those of a month ago, those on the first of the year, and those of a year ago is given herewith: Points increase or decrease compared with August 19 1922 Month Beginning Year ago ago of year Average o f : 20 railroad stocks ............. $91.51 +4.69 +18.03 +19.35 20 industrial stocks .......... 99.01 +2.32 +20.10 +33.92 10 first-grade rail bonds.. 91.21 + .01 + 6.21 +13.72 10 second-grade rail bonds 89.07 +2.01 + 7.95 +14.16 10 public utility bonds... 89.09 +1.19 + 8.42 +15.15 10 industrial bonds .......... 96.62 +1.36 + 5.08 +11.76 4 Liberty bonds ............... 100.71 — .01 + 3.83 +11.86 district show a decline of .02 per cent in savings de posits during the month of July. An , 0 .. excess ot withdrawals over deposits in deposits - , - . . , towns located in or near the coal regions was largely instrumental in producing this decrease. The following table gives a more detailed picture of the changes reported by banks in individual cities: in the coal communities have not been seriously en croached upon. The forms sent out provided for the reporting of these deposits as of April 1, the date of the beginning of the strike, and as of August 1, and also called for information as to the amount of interest credited during the intervening period. Reports were received from 122 banks. These were consolidated with the usual reports received each month, and the whole goup of 203 banks was di vided into three classes according to their location in or out of the coal regions. From the returns, after eliminating the interest which had been credited, it appears that savings deposits in 97 banks in the anthracite region declined 6.5 per cent from April 1 to August 1. After adding interest, the net decline was 5.2 per cent. In the bituminous regions, the figures for 53 banks were 4.5 per cent and 3.1 per cent, respectively, whereas in 53 banks in the non coal regions, the decline, after eliminating interest, was 0.4 per cent, and after adding interest, only 0.2 per cent. The actual figures are given below: (000’s omltted> „ . , Savings deposits: April l 1922 $190,416 $46,814 August l, 1922.... 180,453 45,349 °April 1 to^Aug6 1 Number of banks reporting* .......... * Actual figures. Number of reporting banks A ltoona.................... . Chester .................... Harrisburg ............. Johnstow n............... Lancaster ................ Philadelphia ........... Reading ................... Scranton .................. T renton ................... Wilkes-Barre .......... W illiam sport.......... W ilm ington............. York ......................... Others ...................... T o ta ls................. 5 5 4 6 3 9 3 6 6 5 4 5 5 14 80 Per cent increase or deer ;ase August 1, compared with 1922 1921 1920 July 1, August 1, August 1, - .7% + 9.2% + 18.5% + 2.3 “ — 6.5 “ — 9.1“ + 67.1 “ + 4.0 “ + 116.6 “ — .6 “ — 4.9 “ + .3 “ + 2.4 “ + 2 2 .0 “ + 35.1 “ — .2 “ + 1 .2 “ + 5.5 “ + 8.9 “ + 19.6 “ + .8 “ + 7.7 “ — 1.2 “ + 29.5 “ + 4.5 “ + 7.3 “ + 3.3 “ + 2.0 “ + 2 2 .8 “ — 1.2 “ + 5.4 “ + 17.5 “ + -5 “ + 12.4 “ + 16.8 “ — .1 “ + 44.6 “ + 1.3 “ + 8.8 “ + .0 2 “ + 15.0 “ — 1 .0 “ — .02% + 2.7% + 9.5% With a view to gathering information concerning the effects of the coal strike upon savings deposits, special reports were requested from other banks lo cated in the coal mining sections of the district. From the returns it would seem that savings deposits Banks in Anthracite Bituminous Non-coal sections sections sections 2,499 97 633 53 $348,562 348,028 927 53 Totals $585,792 573,830 4,059 203 In recent years August has been a dull month in the commercial paper business, and this year has proven no exception to the rule. Commercial There have been no changes in paper rates, which still range from 4 t0 4^2 per cent. The banks, for the most part, are apathetic when solicited to buy. Institutions in the truck farming districts usually have funds at this season for investment in paper, but this year they have either purchased other securities or have been able to loan the surplus money on hand to their cus tomers. New York and Chicago institutions have been buying more freely, and the dealers’ lists 01 offerings are about the same as they were a month Sales made by six reporting dealers in the Thu* Federal Reserve District during July total $7 >237 ’' 971, as compared with $7,372,000 in June. Philn delphia institutions purchased $4,622,606 and out of-town buyers took $2,615,365. More than 50 cent of the July sales were at 4 per cent, and on nearly all the rest the rate was 4% per cent. Sales at 4^2 per cent and more were probably less than 10 per cent of the total. The reports of five dealers in bankers’ acceptances operating in the Third Federal Reserve District give _ 9 evidence of the limited nature of the an ers. market, apart from purchases by the acceptance, Reserye Bank ■ Th(/ Re. . oreign of the past month in the foreign ex change market. The mark fell from .20 cents on July 19 to the lowest level in its history, .078 cents, on August 19. This loss of more than 60 per cent in thirty days, which was practically duplicated by Austrian kronen, is attributable in large part to the chaotic condition of the currencies and government finances in these countries. The unsettled situation as regards repara tions has been an important factor in depressing not only these currencies, but Belgian and French francs as well. These two rates have declined heavily dur ing the past month. Italian lire dropped only slightly, however, and the currencies of most of the former neutral countries have strengthened some what. The pound displayed remarkable strength follow ing the failure of the last conference on reparations, and during the past few days has been quoted at close to $4.50, or about five cents more than the lowest value of the month. This strength in the face of the unsatisfactory termination of the conference between Premiers Lloyd George and Poincare seems to indi cate that sterling is not greatly affected by political occurrences. Payments for recent shipments of British and Welsh coal to the United States are, of course, partly responsible for the increased value of the pound. serve Bank more than doubled its average weekly purchases during the latest period under review, but sales to local banking institutions were few, and none were made to banks in other parts of the district. There is still a pronounced tendency on the part of banks to seek the higher returns which can be ob tained from the Government and other securities that are available in the markets. An analysis of the reports received from the deal ers is given below. To facilitate comparison, their figures have been reduced to weekly averages. All figures are given in thousands of dollars. AVERAGE W EEKLY TRANSACTIONS IN THIRD FEDERAL RESERVE DISTRICT AS REPORTED BY FIVE DEALERS IN BANKERS’ ACCEPTANCES (000’s omitted) Period covered Purchases Sales To other banks To To F. R. Bank Local Out-of-town others Total FOREIGN EXCHANGE RATES—NOON CABLES $2,617 2,987 July 19, August 19, August 19, 2,652 1922 1921 1922 3,010 2,738 $4.4557 $3.6548 5,590 Paris ............................................. $4.4792 .0842 .0796 .0772 .0792 .0757 A ntw erp...................................... .0755 .0462 .0453 .0431 Milan ........................................... Rates remain about the same as last month, Berlin .......................................... .000785 .002026 .0119 .000014 .000030 .0012 dealers continue to offer acceptances up to 90 days A m sterdam ..................................... .3887 .3896 .3096 .2161 at 3 per cent, but sales have been consummated only Copenhagen ............................... .2161 .1632 .2604 .2649 .2132 at percentages varying from 3^ to 34 per cent above .1556 .1563 .1293 that figure. .1921 .1908 .1689 .8177 .8243 .6670 The amount of acceptances created within the Shanghai .................................... .7736 .7734 .6803 Feb. 13-Mar. 12 Mar. 13-Apr. 16 Apr. 17-May 14 M?iy 15-June 11 June 11-July 16 July 17-Aug. 13 $420 530 790 827 489 596 $1,842 2,548 2,208 2,949 2,599 5,440 $220 417 361 46 114 150 $555 22 48 15 24 0 0 0 $35 0 0 0 Third District by 12 reporting banks increased durlng the month ending August 10 to $3,966,000, as eompared with $2,895,000 for the month ending July I(^ with $4,612,000 for that ending June 10, and 'Vlth $3,274,000 for the preceding month. The dealers report that the importation of sugar figured Very largely in recent acceptances. Other transachons included the importing of coffee and silk, the Sporting of cotton and grains, and the storage of £rain and tobacco. The demoralization of German and Austrian cur a c ie s has been the most conspicuous development RETAIL TRADE In 1921 only 5.9 per cent of the annual sales at re tail in the Third Federal Reserve District were made during the month of August, and as this figure in cluded the very important furniture sales, it is clear that other lines of merchandise were moving in small quantity. This year the early reports indicate that furniture sales are fully as large as, and perhaps larger than, those of a year ago, but that the total business is likely to be less than it was at that time. 7 RETAIL TRADE C om parison N et S ales C om par ison of July,.1922, with July, 1921 Tuly 31, 1922, with July 31, 1921 July 31, 1922, with June 30, 1922 July 1 to July 31, 1922 — 3.7% — 3.3 “ + .3 “ + 6.6 “ — 3.6 “ + 1 .2 “ + 1.9“ —25.0 “ — 4.8 “ + 6.1 “ + 4.1 “ + 4.9“ —11.3 “ — 3.1 “ + .3 “ — 8.4 “ — 9.6 “ — 56“ — 1.6“ —20.4 “ + 1 7 .0 “ +16.3 “ — 2.6 “ — 3.0% — 5.6 “ + 8.5 “ + 4.7 “ — 6.7 “ + -5 “ + 3.0 “ + -5 “ —19.8 “ + 2.6 “ — 2.0“ — 3.1 “ — .2 “ —10.1 “ — 2.8 “ + 5.1 “ —14.4“ + 5.8 “ + 6.4 “ — 1.7“ — 4.3 “ — 6.8 “ + 3.7 “ — .2 “ — 7.6 “ — 1.5 “ — 3.5 “ — 6.1 “ — .9 “ + .5 “ — 3.4 “ —11.9 “ — 2.4 “ — 2.7 “ —21.1 “ — 13.3 “ + 9.2 “ 2.4 2.7 L3 Another month of the coal and railroad strikes has induced further caution on the part of the buying public, and although this is more noticeable in the stores in other cities of the district than in those in Philadelphia, it is certain that even in the largest department stores here, there are indications that the long continuance of these strikes is reflected in sales. Furniture and men’s wear are the commodities in which there has been the heaviest business in both cash and credit stores. In women’s wear the great est effort is still required to maintain sales on a parity with those of a year ago. The table above shows that retail sales in the Third Federal Reserve District during July decreased 3.7 per cent, as compared with those of July, 1921. In this table, the sales of Allentown, Bethlehem and Easton stores are given for the first time. WHOLESALE TRADE With the exception of the current demand for hardware from contractors and builders, and for sugar to be used for preserving, the four wholesale reporting lines find that business is dull. The lack of demand may be attributed to the normal mid summer-lull, to the influence of the railroad and coal strikes, and to the reluctance of consumers to buy other than necessities. The strikes have not only R a t e of T urnover <o COLO 11 All reporting firms (113)............... Firms in—Philadelphia...................... —Allentow n.......................... —Bethlehem ........................... —C hester............................... —Easton ................................ —H arrisburg......................... —Johnstow n......................... —Lancaster........................... —Reading............................... —T renton.............................. —W ilm ington....................... —All other cities................. All department stores......................... Department stores in Phila................ Department stores outside Phila___ All apparel stores................................. Men’s apparel stores— —in Phila................................ —outside Phila...................... Women’s apparel stores— —in Phila............................... —outside Phila...................... Credit h ou ses.......................................... S to ck s of Percentage o f orders outstanding July 31, 1922, to total purchases in 1921 8.7% 8.9 “ 2.1 2.4 2.5 2.2 1.8 2.5 1.5 22 2.4 2.6 22 2.7 2.0 1.3 3.9 3.1 1.6 13.8 “ 102 “ 5.9 “ 6.7 “ 9.8 “ 10.7 “ 7.6 “ 4.3 “ 18.6“ 3.7 “ 5.3 “ 4.5 “ curtailed the volume of sales made by retailers, but have created a feeling of uncertainty which has lessened future buying and caused the orders booked by wholesalers to decrease. In addition, the strikes have made collections in all four lines much slower, as will be seen from a comparison of the ratio of ac counts outstanding to sales, for July of this year, with the percentages for July, 1921, and June, 1922. During the past month the demand for drugs has not only remained listless but even diminished. In comparison with those of June, July Sa^eS decreased *5 Per cenb 331d it not been for decided increases re ported by a few firms, this percentage would have been much larger. As compared with the figures for July, 1921, sales in July this year showed an in crease, indicating that business, though still poor, has greatly improved during the past year. Except in the case of a few firms that have re ceived goods for fall, stocks are no heavier than they were last month, and may still be described as “ light.” Supplies now on hand are considerably smaller than they were a year ago. Not only are the stocks of wholesalers light, but the carryover of many drugs from last year in the hands of importers is short. For instance, saffron flowers are scarce, and the spot supplies of camphor, gum arabic, seneg3 drugs C and rhubarb roots are not heavy. In addition, in creasing costs of collection, both in this country and abroad, are adding to the cost of many drugs in the primary markets. As a result of these two factors, drug quotations on the New York market have be come decidedly firmer, but notwithstanding this, the prices quoted by wholesalers remain practically un changed. Since July 15, orders for heavy chemicals have somewhat decreased. On account of the uncertainty as to costs during the fall and winter, customers are not anxious to book future orders. Some manufac turers of chemicals report that they can accept no more orders for future delivery because of the im pending scarcity of fuel, for the production of bichro mates, caustic potash and caustic soda is almost wholly dependent upon large supplies of coal. Es tablishments in this district are running at about 80 per cent of capacity. Quotations for ammonia and caustic potash have been steady, but prices of salt cake and bleaching powder have advanced. In plants affected by the lack of coal, stocks are light, but in those which are not dependent upon coal or are mak ing a product that has been in small demand, stocks are heavy. In spite of the fact that during the fiscal year end ing June 30, 1922, exports of all chemicals de creased about 50 per cent, the exports of heavy chemicals gained both in weight and value. For ex ample, exports of acetate of lime and glycerine dou bled in quantity, and those of caustic soda, borax and silicate of soda gained heavily. However, the ex portation of both bleaching powder and soda ash de clined. Collections are only fair, and the majority of firms report little change since last month. However, in proportion to the volume of sales, the accounts out standing for July have increased considerably, the ratio for July being 137.5 cenC as compared with *30.4 per cent for June. The demand for dry goods is very unsatisfactory, and orders placed by retailers are small in size. Be- f dry goods cause of doubt as to the strength of 1 ie consumer demand, and the in jurious effect of the strikes, retailers are buying with caution. Nevertheless, jobbers and wholesalers are certain that the stocks of retailers are low, and for this reason they feel hopeful. To what extent the demand has diminished is shown by the fact that sales for July were 21.5 per cent less than those for the same month last year, and 26.7 per cent smaller than the sales for June of this year. Although in the placing of future orders retailers have been very conservative, some business has been booked for September delivery in tickings and wide sheetings. Considerable interest also has been mani fested in flannels and blankets, and among the wash fabrics, in crepes and colored ratine specialties. In spite of the fact that the resistance of the retail ers to price advances is abnormally great, prices are firmer. However, the present level is about 8 per cent lower than that of 1921. Stocks of wholesalers are much smaller than they were last year, but be cause goods are arriving in preparation for fall, they are heavier than last month. It is reported that stocks are well distributed among the various depart ments. The strikes have not only affected the volume of sales, but have delayed collections even more seri ously. In comparison with June, collections are slower, the ratio of accounts outstanding to sales be ing 244.3 cent for June, and 301.1 per cent for July, 1^22. There was a slight increase in sales throughout the wholesale hardware trade during the early days of August, but it was not of sufficient W o esa e volume to be more than noticeable. tX C L T d W C L T C Indeed, a few firms report a small decrease from July business, but this condition is the exception rather than the rule. Contractors and builders continue to buy freely of building materials, and sales are good also in the farming districts. In addition, certain dealers report that sales to manu facturers are improving. Mine operators are buying CONDITION OF W HOLESALE TRADE DURING JULY, 1922 Number of reporting firms D rugs goods groceries . hardware 15 16 49 30 in P ercentage of incr ease or decrease Accoun ts outstanding Ratio of accounts Net sales July, IS>22, compared outstanding to sales July, 1922 compared with July, 1922 Wl th June, 1922 July, 1921 July, 1921 June, 1922 -f-7.5% 4 1 1 0 % + 6.6% 137.5% — .5% 4 9 .8 “ — 9.8 “ — 21.5 “ 301 .1 “ — 26.7 “ 4 1 .4 “ 4 3.4 “ — 7.1 “ 112.4“ — 10.2 “ — 4 .4 “ 4 2.4 “ + 6.3 “ 181.8 “ — 13.7 “ 9 in negligible volume, however, and retailers in the mining districts are unable to purchase in large quan tities because the greater part of their capital is tied up in overdue accounts. Sales for the month of July, as reported by thirty firms in this district, were 13.7 per cent less in value than those for June. Accounts outstanding de creased by 4.3 per cent during the same period. As compared with those of last July, however, sales are larger in value by 6.3 per cent, and accounts out standing by 2.4 per cent. O f course, this increase is greater than appears on the face, because prices are considerably less than they were a year ago, and therefore the above figures represent a substantial gain in volume. The margin of profit, on the whole, is less than it was last year, a fact which is ac counted for in some instances by keen competition and price cutting. Prices are firm, and on articles manufactured from iron and steel show a tendency to rise. Some dealers report that quotations on cer tain articles are downward, but these cases are decid edly in the minority. Collections are generally fair, although in some instances, especially in the mining regions, they are quite unsatisfactory. Since June, the demand for groceries has de creased. The effect of the strikes upon the purchas ing power of many consumers in the Wholesale Third Federal Reserve District has groceries cauS€Cj sales by retailers to decline. This, together with the fact that many retailers are allowing their stocks to become light in order to cur tail purchases made by their customers on credit, ac counts for the smaller demand reported by whole salers. Sales for July, as reported by 49 firms, were 10.2 less than those in June, and 7.1 less than the sales for July of last year. The dulness of the de mand in July has now somewhat disappeared, but or ders for all goods, excepting canned and dried fruits, continue to be for prompt delivery. Those goods which are selling most readily are staples, such as canned vegetables, especially canned peas, potatoes, flour, cereals and fruit jars. Because of the canning season, sugar is selling in large quantities. Stocks held by wholesalers are light, but reports are equally divided as to whether they are increasing or decreasing. Inventories of those firms whose goods for fall are already arriving are larger, for many based their purchases on the good demand of May and June. Few changes have occurred in the level of prices. However, sugar has advanced in response to the seasonal demand. On the other hand, flour, butter and raisins are lower. In the district as a whole, collections have been only fair, and in the anthracite regions they have been poor. The ratio of accounts outstanding to sales was 112.4 per cent for July, as compared with 100.8 per cent for June and 102.6 per cent for July, 1921. Because of the extremely light pack of peas in both 1921 and 1922, the demand for canned peas is active and prices have advanced. Moreover, can n ed sjnce this season’s crop of tomatoes has been severely damaged by rains, and since the supplies are small, canned tomatoes are in fair request at quotations that are firm. The demand for canned corn, however, is poor, and because of this and of the moderate carry-over, offerings are being made at bargain prices. Stocks of canned goods are lighter than they were last year, and are now quite low. As compared with the prices of last year, present quotations on nearly all canned products, ex cept peas and tomatoes, are from 10 to 20 per cent lower. The crop of peas this season in this section was a failure, and is estimated to have been only 50 per cent, and in many sections only 20 per cent, of nor mal. However, the Wisconsin crop, which is of great importance, is reported to have been normal and much heavier than the yield of last year. The tomato crop was, on the whole, disappointing. Canners had expected a heavy yield in Maryland and Delaware that could be purchased at low prices. For that reason, many refrained from contracting for their supply and thus forced the farmer to assume the risk entailed in growing the tomatoes. Although in New Jersey both the acreage and the yield were fairly heavy, farmers in the more important Mary land district planted only about 66 per cent of the normal amount. Then extended rains damaged the early crop severely, and it is reported from many sections that the yield will not exceed 50 per cent of normal. The pack of corn for this season is about as usual. With the exception of strawberries, the supply of fruits has been plentiful. IRON AND STEEL Production difficulties continue to be the principal obstacle to further improvement in the iron and steel industry. The effect of the growing scarcity of fuel, which was quite noticeable during July, has be come much more pronounced during the past month. Blast furnaces have suffered especially, and many have been banked or blown out during the past fe'v weeks owing to the inability to obtain coke. Steel mills have also been embarrassed by lack of coal, and in some instances fuel oil has been substituted for coal for heating open-hearth furnaces. The severity of the coal shortage is not attributable alone to the miners’ strike, as transportation facilities have not been available for much of the non-union output. The strike of railway shopmen resulted in serious congestion of traffic on some of the southern lines, and this prevented delivery of coal to iron and steel plants from the non-union fields in Kentucky and West Virginia. Evidence of the contraction of operations dining July is seen in production statistics for that month. The output of steel ingots, as reported to the Ameri can Iron and Steel Institute by companies producing over 85 per cent of the country’s total, was 2,487,104 tons, which is 147,373 tons less than the total for June. The daily rate of pig iron production was more than 1,000 tons lower in July than in the pre vious month, although the total production, 2,400,045 tons, was somewhat higher than in June. This slackening of production was in both cases small, but it is quite significant in view of the fact that nearly all the companies still have a large volume of unfilled orders on their books. Indeed, the Steel Corporation reported a small increase in their total unfilled orders during July. The relative fluctuations in this index and in steel and iron production since 1918 are shown in the accompanying chart. It will IRON AND STEEL THOUSWfJ TONS 10000 5000 4000 3000 2000 V V^ vV V >r* 1000 500 400 300 200 100 Y Unfilled Orders of US Steel Gorporohoo mmmmm Production of PlCj IfOO mmm 1919 1920 1921 1922 1923 Source—*'Iron Age.** seen that the output of pig iron and steel ingots has shown an almost continuous increase for ap proximately the past year. 11 Although an early settlement of the bituminous strike and a resumption of mining are in prospect, it is quite possible that the beneficial effect upon the iron and steel industry will be delayed. The estab lishment of coal priorities has placed iron and steel plants far from the head of the list, and many of them will have exhausted their already scanty fuel supplies before replenishment is possible. Indeed, so many furnaces have been blown out during the first few weeks in August that pig iron output for the month will probably show a pronounced decline. Further more, transportation difficulties have increased dur ing the past few weeks, as more cars are out of commission owing to lack of repairs. Another problem which has affected many pro ducers of finished products, especially those in Phila delphia, has been the growing scarcity of both skilled and unskilled labor. In some instances labor shortage has been a more serious deterrent to increased opera tions than has fuel scarcity. Significant of the labor situation is the recent announcement of the United States Steel Corporation and several independents that wages will be advanced 20 per cent on Sep tember 1. But operations in factories of this dis trict producing many lines of iron and steel products have expanded in spite of the obstacles which have been encountered. A few small plants, it is true, are still producing only a fraction o f their maximum possible output, but several large producers report capacity production. The general average of opera tions, except for blast furnaces, is somewhere between 50 and 65 per cent of capacity. In spite of restricted output and inability to fill existing orders, price advances during the past thirty days have not been excessive. Nearly all grades of pig iron have risen considerably, it is true, but this is not surprising in view of the fact that furnace coke now sells at $14 per ton, as compared with $7.50 two months ago. Finished products, however, have experienced only moderate advances. Steel bars were selling at 2.00 cents per pound on August 22, as com pared with 1.70 cents a month previous, and prices of tank plates and beams rose the same amount. Bessemer and open-hearth billets, sheets, wire nails, plain and barbed wire, have all advanced slightly, but tin plate is unchanged as compared with the previous month, in spite of the increased demand for this product. Indeed, the Iron Age composite price of finished steel rose only from 2.169 cents to 2.412 cents during the month. The fact that prices of most products have not ad vanced more sharply during the past month points ning machinery, as satisfactory crops this year have resulted in a successful season for canners. This betterment in the canning industry is also reflected in increased sales of tin plate to manufacturers of cans. to the probability ot somewhat lessened buying. The building industry, for example, although still buying actively, has purchased less structural steel than dur ing the early summer. Oil producers also, who were responsible for much of the buying of pipe during May and June, are now making smaller purchases. Furthermore, a seasonal decline in automobile pro duction has occurred, and sheets are in somewhat less demand in consequence. On the other hand, railroad buying for maintenance, replacement, and repair work has been the heaviest in years, and pur chases of cars and locomotives have also been large. Moreover, manufacturers of machinery are becoming more active buyers of steel and iron, as they are now finding a readier market for their products. This betterment is especially noticeable in the case of can BUILDING MATERIALS July witnessed a falling off in the building activity in the Third Federal Reserve District. The de crease in the number of permits issued was not large, however, and seemed to be proportionate in all parts of the district. As shown in table i, there were issued in the fourteen principal cities during the month of July, 3,029 permits for operations estimated to cost $15,898,696, as against 3,624 permits at an estimated cost of $18,177,759, for the month of June. In Philadelphia, the number of permits issued in July T able I BUILDING PERM ITS ISSUED AN D TH EIR ESTIM ATED COST—1921-1922 Third Federal Reserve District During the Months of June and July 1922 Permits A llentow n......................... Altoona .......................... Atlantic C ity ................... Cam den............................. H arrisburg...................... Lancaster......................... Philadelphia ................... R eading............................. Scranton.......................... T renton............................. Wilkes-Barre ................. Williamsport ................. W ilm ington..................... York ................................. Totals ....................... 88 153 267 93 66 70 1,359 249 143 112 111 90 101 127 3,029 July 1921 June Est. Cost Permits Est. Cost Permits $321,575 242,709 857,524 446,720 778,445 142,550 10,531.810 187,825 1,140.301 522,625 336,697 105,966 129,448 154,501 $15,898,696 85 130 532 133 100 78 1,492 273 195 152 124 106 86 138 3,624 $228,900 356,426 348,058 378,428 402.116 259,930 13,190,220 368.300 1,065,572 508,638 581,324 58,683 215,998 215,166 $18,177,759 46 144 200 82 62 92 1,277 224 54 127 66 50 86 89 2.599 July Est. Cost June Permits $64,475 149,043 170,887 148,509 290,170 222,360 3,824,565 177,950 136,070 250,360 153.225 78,420 77,200 132,437 $5,875,671 68 184 237 114 45 33 1.406 278 64 134 77 36 84 113 2,873 Est. Cost $207,968 243,947 1,096,770 183.507 426.395 106,795 4.587.395 297,250 206.019 149,731 94.975 63.945 172.640 38,302 $7,875,639 T able II BUILDING PERM ITS ISSUED AN D THEIR ESTIM ATED COST—1921-1922 Divided Into New Buildings and Alterations 1922 New Buildings Est. Cost Permits A llentow n........................ A ltoon a............................. Cam den............................. H arrisburg...................... Lancaster......................... Philadelphia.................... Reading .......................... Scranton .......................... T renton............................. Williamsport .................. W ilm ington..................... York ..7 ............................. Totals ....................... 71 54 52 43 41 740 80 85 94 35 59 1.354 $285,525 220,239 410,295 766,020 114,900 9,929,500 86,925 957,781 509.135 98,910 138,730 $13,517,960 Alterations Est. Cost Permits $36,050 22,470 36,425 12,425 27,650 602,310 100,900 182,520 13,490 7,056 15,771 $1,057,067 17 99 41 23 29 619 169 58 18 55 68 1,196 12 New Buildings Permits Est. Cost 32 39 55 62 598 62 98 24 65 26 1,061 1921 $53,750 113,702 266,260 184.455 3,251.970 74,200 174.822 74,750 51,909 49,090 $4,294,908 Alteratio Est. Cost Permits 14 105 7 30 679 162 29 26 21 63 1,136 $10,725 35.341 23.9 i6 37.906 572.595 103.750 75.538 3.670 25.291 83.347 of this year was little more than 6 per cent greater than for the same month of 1921, but the estimated cost was 2^4 times that of last year. This condition is due to the fact that several of the permits were for large buildings, and this increase in the estimated cost of buildings in Philadelphia is largely responsible for the increase of approximately $10,000,000 in the value of permits issued this July in the district as a whole, over those issued in July of last year. Table 2 gives the number and value of building permits issued in July of 1921 and 1922, classified under the heads of new buildings and alterations. It is significant that in July, 1921, 48 per cent of the permits issued were for new buildings, as compared with 53 per cent in July of this year. Prices of building materials have either remained stationary or increased slightly during the past month. The coal and rail strikes have had their ef fect especially on brick and lumber quotations, which have stiffened somewhat. It was commonly reported early in the month that construction work would have to be curtailed, or discontinued in some cases, if the strike situation did not clear up to such an extent as to make shipments easier. Demand continues very strong in the brick in dustry, especially in the Philadelphia district. All . local yards report heavier business than brick ^ast mont^ and a ffreat improvement over a year ago. In other parts of the Third Federal Reserve District conditions vary. One Manufacturer, in a section where building is rapid, reports a 300 per cent increase in sales over last year. In one or two cases there has been a slight falling °ff as compared with a year ago, but this is largely due to local conditions. Some producers are re fusing orders for future delivery, and others are Slxty days oversold. Practically all yards are operatmg at full capacity, and in nearly all cases where production is curtailed, it is due to lack of coal. In °ne or two instances, manufacturing has been entirely suspended because of the high price of fuel or the difficulty in procuring it. A t best, only a few weeks’ supply is on hand. . Fhe coal situation has naturally had a tendency to increase prices. One manufacturer reports that his uel costs four times as much as it did in April and at his operating expenses are increased 40 per cent ecause of this item alone. As a general rule, opera° rs have split the increase in the cost of coal with the c°nsumer, so that prices have increased, on the averfrom one to two dollars per thousand. Stocks are low in nearly all cases and shipments generally equal production. Local producers report increased difficulty in ob taining labor, especially unskilled labor. Wages have been advanced in some cases as much as 8 per cent during the past month. Common labor is now re ceiving 30 cents an hour, and yard labor 40 cents. Collections, on the whole, are good, and are de cidedly better than they were a year ago. In a few instances, however, they remain only fair. Demand for building lumber usually falls off some what during July and August, and this year a few dealers have reported a slight decline in Lumber sales. Considering the season, however, the market on the whole has held up ex ceptionally well. In fact, some reports of increased business have been received. In practically every case, business is from 20 to 50 per cent better than at this time last year. Furniture manufacturers seem to have entered the market more freely, but the de mand from them is not yet normal. The better grades of hardwoods are moving well, and recently there has been more call for lower grades to be used for crating. Orders, for the most part, are for im mediate delivery. Mills are working at capacity in most instances, but distribution has been hampered somewhat by the shortage of freight cars and by the embargo on lum ber enforced by certain of the southern roads. Some mills have all their sidings loaded with cars ready for shipment, but have been unable to move them. For the first 31 weeks of 1922, the production of eight re gional soft-wood associations, as reported to the National Lumber Manufacturers Association, was 6,334,209,446 feet, as compared with 4,624,955,952 feet for the like period of 1921. These figures in dicate an increase of about 37 per cent in production over last year. Mills are operating at about 85 per cent of capacity, and there is no difficulty in filling requirements other than that caused by car shortage and embargo. Sup plies held by dealers in this district are about normal, "although recent shipping difficulties are said to have cut down stocks to a certain degree. Prices for hardwoods have remained firm. Soft woods have strengthened somewhat, quotations in some quarters being from 50 cents to $1.00 per thou sand feet higher than a month ago. Shipping diffi culties account for most of these increases. In all but isolated cases, labor appears to be sufficient for present needs. Practically no changes have been 13 made in wages, except in some of the southern mills of cases. There is no tendency to load up at this where small increases have gone into effect. time, and those dealers who are heavily stocked are Collections are still fair. Some dealers report that buying sparingly. Slight advances have occurred in the price of cop they expect collections to be somewhat slower at this time owing to the fact that contractors have not per wire and of electrical instruments manufactured yet received payment for houses under construction. from steel and brass. Conduit pipes have risen on The demand for paint has undergone a slight an average of $5 a ton. Specialties, on the contrary, seasonal slump during the past month, but as a whole have fallen off in price to some degree, and radio the market continues to hold up fairly well. equipment is lower. Many dealers bought radio sup Paint Only one firm reports a decrease as com plies heavily during the spring and now, in view of pared with the similar period of last year, the present small demand, are lowering their prices in and the volume of business done by other manufac order to move stocks. turers represents an increase of from io to 25 per In the majority of cases collections are reported to cent. A marked improvement in demand is looked be slower than they were two months ago, and in for within the next few weeks in preparation for the some cases not as good as for the same period last usual fall work. Manufacturing operations vary year. from 50 to 100 per cent of capacity, the average COAL being about 85 per cent; stocks are either light or The situation in the anthracite industry, which had moderate, and there seems to be no tendency to load looked promising for an early settlement, became up. Raw materials are easily obtainable. acute again with the breaking off Prices of ready mixed paints are firm and show Anthracite of the negotiations between the opera a tendency to rise. Indeed, one or two national tors and miners. The system of manufacturers are reported to have increased prices determining wages after March 31, 1923, was the 10 cents per gallon. Raw material prices have re subject upon which an agreement could not be mained steady, although slight advances are reported reached. The conference adjourned to meet at in certain cases. the call of the secretary upon request of either the Collection have fallen off somewhat during the miners or operators. This adjournment is, of course, past month and are only fair at present. This condi indefinite, but at the present writing the outlook for tion usually obtains during the vacation period. In an early settlement of the anthracite strike is not so most instances payments are not as prompt as they bright as it was earlier in the month. Until the were a year ago. anthracite miners return to work, there seems to be no Demand for electrical supplies has fallen off possibility that production will exceed the present slightly during the past few weeks, but not more than is usual in July and August. Electrical Sales in volume are reported to be bet supplies ter than in the corresponding period of last year. There is still a considerable amount of wiring being done on new buildings, and one firm reports fairly large school contracts. But industrial demand is very light. It is interesting to note that radio sales are almost negligible, a fact that is prob ably to be accounted for, in part at least, by poor static conditions during the summer months. Spe cialties, such as toasters, grills, and electric irons, are reported to be moving slowly. Some firms look for increased activity during the early fall, but others are concerned over the effect of the railroad and coal strikes upon the building industries. Dealers in the coal region have felt the coal strike through the de creased purchasing power of the local population. In nearly every instance sales are for immediate de livery. Stocks are light or normal in the majority 14 total of 25,000 or 30,000 tons per week. This small amount consists chiefly of steam sizes dredged from the rivers, and these do not always contain sufficient heat-producing power to be satisfactory. The accompanying chart depicts the production of anthracite coal by months since 1919 and shows the tremendous drop in output since April 1. Shipments are practically confined to pea coal and smaller sizes, and stocks of these are becoming so depleted that local dealers have restricted the amount to be de livered to individual customers. Even with this pre caution, the available supply will last only a few days, and though the strike were to be settled at an early date, local stocks could not be materially in creased within several weeks, owing to the fact that capacity production cannot be reached at once after the commencement of operations. Both miners and operators appear willing to come to some agreement, although miners in certain dis tricts are believed to have savings sufficient to last for some time to come. Some mine employees have been attracted to the building trades, and others have gone into agricultural work. The general business situa tion in the mining towns is anything but active, however, and business has been decreasing rapidly during the past few weeks and is approaching stag nation. The shortage of bituminous coal has been felt acutely in this district during the past month, and the demand from railroads, public Bituminous utilities, and industries has been es pecially strong. Certain plants, no tably in the brick, iron, and steel industries, have been forced to curtail operations or to discontinue them altogether, owing either to the difficulty in Procuring fuel or to the high prices which made pro duction unprofitable. One operator estimates that railroad stocks are sufficient to last about two weeks; Public utilities’ stocks, on an average of from 30 to 40 days; and industries’ stocks, approximately 20 *° 3° days. During the week of August 14-19, the mines that had been working throughout the strike period pro duced about 4,300,000 tons. Operations were re sumed during the week in several union mines in Ohio and other states, in accordance with the Cleveand agreement. But it is not believed that the pro duction of these mines will raise the total output a great deal above the 4,756,000 tons produced during the previous week. This relatively smaller output Was chiefly due to the fact that traffic conditions beCarne worse in several of the non-union and open shop fields. The week’s estimated production is ap proximately 650,000 tons below the level reached prior to the shopmen’s strike. During the past month a moderate amount of British coal has arrived in this country, but the greater part of this has gone to New York and seems to have had little effect on the market. The accompanying chart shows that output is about equal to that during the strike period of 1919. At that time, however, operations were not interrupted over such a long period. Effects of strike are shown clearly. Production for July, 1922, is partially estim ated. Source V. S. Geological Survey. — Contract prices are not being considered at this time. Spot coal continued to advance until the third week in August when the market softened. Quota tions on high volatile and gas coals on August 23 varied from $6 to $7.25 a ton at the mines, as com pared with $7.50 and $9 a week earlier. Demand for furnace and foundry coke continues strong, although consumers are having difficulty in obtaining supplies even at the advanced Coke prices. On August 22, Connellsville furnace coke was quoted at $12 ton, and foundry coke at $13, as compared with $14 for both varieties on July 25. Production of beehive coke is increasing slowly, and the output for the second week of August is estimated at 112,000 tons, an increase of 1,000 tons over the preceding week. Beehive production for the month of July, however, was somewhat less than for the month of June, as is shown in the ac companying table. The output of by-product coke decreased in July, owing to the growing scarcity of coal. The total production for the month was 2,486,000 net tons, 15 as compared with 2,580,000 tons in June. Despite the decrease during July, the output was within 3 per cent of the monthly average of 1920, during which year production reached its maximum. The accompanying table shows the growing importance of by-product coke over beehive. M ONTHLY O UTPUT OF BY-PRODUCT AND BEEHIVE COKE IN TH E UN ITED STATES (N et tons) By-product coke Beehive coke 1917 Monthly average .. 1918 “ “ 1919 “ “ 1920 “ “ .. 1921 “ “ April, 1922................. M ay/ 1922................. June, 1922................. July,' 1922................. 1.870.000 2.166.000 2.095.000 2.565.000 1.660.000 2,208,000 2.537.000 2.580.000 2.486.000 2.764.000 2.540.000 1.638.000 1.748.000 463,000 528.000 432.000 458.000 450.000 Total 4.634.000 4.706.000 3.733.000 4.313.000 2.123.000 2.736.000 2.969.000 3.038.000 2.936.000 The areas below the export and consum ption lines represent the total export and American takings respectively. Q uotations are for spot cotton. Sources "Dun’s Review," "Monthly Summary of Foreign Commerce and Department of Commerce — ” . That the same tendency has continued since August 1 is indicated by the following table, showing a com parison of the weekly takings, domestic and foreign, with the average weekly takings for the whole season as estimated by a large Philadelphia dealer, and with the consumption figures of the corresponding weeks of last year. COTTON On account of a lessened demand, both foreign and domestic, the cotton market, in spite of the rise that ^ followed the issuance of the Government cotton croP rePort on August 1, weakened early in the month. However, by the 22nd, the deterioration which the crop suffered by reason of the continued lack of rain in Texas, and the in creased weevil damage east of the Mississippi, caused the high level of 23 cents to be regained. The price of spot cotton had fallen from 22.50 cents on July 20 to 20.35 on August 8, and this decline was caused not only by the slack demand, but by many other factors, such as the unexpectedly small damage done by the boll weevil up to that time, the specula tion regarding the future effect of the further decline in the German and French exchange upon the con sumption of cotton, and the political and industrial unsettlement that became increasingly evident after the failure of the London Conference. The signifi cance of the political developments abroad is quickly reflected on the cotton exchanges, for the English cotton trade sells a considerable part of its product on the continent of Europe. The cotton trade had believed that the consumption for the past year would at least be equaled during the season which com menced on August 1, but the foreign situation is capable of causing the world’s takings to diminish greatly. Before the end of the last cotton year, as may be seen from the following chart, both exports and domestic consumption had begun to decrease. T his year W eek W eek ending ending July 28 A ug. 4 (bales) (bales) W eekly W eek W eek average ending ending for season A ug. 11 Aug. 18 1921-1922 (bales) (bales) (bales) American mill takings (inch Canada) . . . . 80,145 *62,494 100,668 71,160 121,000 Exports ........................ 47,712 73,878 21,377 61,858 116,000 C orresponding w eeks of last year American mill takings (inch Canada) ... 75,895 **72,777 76,810 80,523 Exports ......................' 152,599 127,007 63,359 65,157 ---* 4 days. ** 5 days. One month ago, we reported that the attention of cotton men was centered mainly upon the supply* but since the issuing of the Government cotton re port on August 1, it has been focused more and more upon the demand. This report placed the con dition of the crop on July 25 at a lower figure than the trade had been expecting, with the consequence that prices advanced sharply. However, within a week, they had lost more than they had gained. The underlying cause of the weakening of the market was undoubtedly the lack of buying. But there was also a general feeling of doubt regarding the ac curacy of the report, since its condition figure o 70.8 was so far below that of the private reports, 16 fourteen of which averaged 73.3. Although this year’s figure, as shown by the chart below, was not much below the ten-year average of 73, many in the trade believed that the correspondents of the Depart ment of Agriculture had been influenced in their statements regarding actual conditions by their fears of possible weevil damage in the future. In Texas a long spell of dry weather has prevented any heavy damage from the weevil, but it has also caused the crop to deteriorate considerably. More over, while Texas was dry, states east of the Mis sissippi were so wet that the weevil was destructive. In short, what the size of this year’s crop may prove to be is more than usually uncertain. The statistical position of cotton has become con stantly stronger, for in spite of the light demand from abroad, domestic spinners have consumed more each week than the quantities coming “ in sight.” Conse quently, the visible supply will continue to decrease until the new yield arrives in sufficient quantities to equal the takings. That comparatively little of last season’s cotton remains in the South is indicated by the fact that the stocks on August 18 in 42 interior towns were only 332,745 bales, as compared with 1,028,969 bales last year. The world’s supply and takings of the new crop are given in the following table compiled from the report of the New York Cot ton Exchange: SUPPLY AN D TAKINGS OF AM ERICAN COTTON Season of Season of 1922-1923 1921-1922 The July condition report gave promise that the present crop would exceed that of last year and would closely approach the ten-year average. Visible supply, American, at end of previous season (July 31) ............................................... The destruction by the weevil, which was the Crop in sight, American, to August 18 of each season... threat that had sustained the market until a month ago, has not been as severe as was anticipated. T o ta l................................... Neither were the weevils as numerous, nor were Visible supply, American, on their ravages so disastrous, as had been feared after August 18 of each season... the 30 per cent loss of last season. According to the World’s takings of American opinions obtained by the Crop Reporting Board from cotton to August 18 of each season .......................................... county agents and cotton reporters, the estimates of Source— "Weather Crop» end Markets .” the former regarding the portion of the growing acreage now infested with boll weevil average 80.2 per cent, and of the latter 71.3 per cent. The Board has also classified its reports of the estimated damage caused by the weevil up to July 25 as follows: State V irg in ia ......................... N orth C arolin a . . . . S ou th C arolin a ____ G eorgia ......................... D o r id a . . . A lab am a ...................... "M ississippi ................... L o u is ia n a ...................... J e x a s .............................. O klahom a A rk an sas I cnnessp«» M isso u ri . N one 5.3% 21.0 “ 32.4“ 30.3 “ 15.7“ 21.0 “ 27.0“ 14.5 “ 14.0 “ 12.9 “ 72 “ N one N one 82% 30.7 “ 39.5 “ 48.0 “ 21.4“ 21.9 “ 31.0 “ 19.7“ 20.2 “ 16.9" 11.1 “ N one 1,963,744 4,112,651 2,943282 234,262 340,604 180,037 2208,006 4,453,255 3,123,919 1,677252 3,829,636 2,626,696 540,754 623,619 497223 It will be noticed that the visible supply at the end of the season ending July 31, 1922, was 1,963,744 bales, as compared with 4,112,651 bales a year be fore; and one cotton expert has estimated the total world’s carry-over of American cotton to be 4,904,000 bales, or 4,460,000 bales less than his estimate of 9,364,000 bales for last year. Thus, during the past year the quantity of cotton in existence has markedly decreased. If the coming yield proves to be no larger than the present esti mates, varying from 11 to 12 million bales, would indicate, a consumption during this year equivalent to the 12,800,000 bales consumed last season would cause the visible supply to decrease still further. But the amount of foreign and domestic consumption during the next eleven months will depend largely upon the factors mentioned above. R ep o rted by Commissioner of County Cotton Bureau’s agents reporters agents Agriculture 1.4% 40-60 “ 50.0 “ 25.0 “ 5-10“ 30-40 “ 30.0“ 8-10“ 10.0“ Season of 1920-1921 N one 1.4% 10.0 “ 28.0“ 25.0“ 23.0“ 28.0“ ........... N one 17 Although sales of yarn are much heavier than they were at this time last year, spinners and dealers are discouraged, for the demand not only re°yarns on mains fpoor but since jTuly i 5 has even dej j creased. The flatness of the demand has caused a curtail ment of production in many southern mills. Pur chasing is lessened by the seasonal slump, by the uncertainty as to what styles will be in vogue and what yarns will be required, and by the differences of opinion regarding the future price of raw cotton. The present dulness seems to be shared alike by both the knitting and weaving mills, and business is at a standstill. But yarn merchants are hopeful that by September the mid-summer lull will have disappeared. Orders continue to be small in size, and an inquiry for only 5,000 pounds seems attractive. Most of the orders that are filled from stock located in Phila delphia are shipped promptly, but when yarns are ordered from mills situated outside of this district, the contracts ordinarily specify that shipments be commenced within thirty days and finished within ten weeks. Moreover, lack of coal has caused the stoppage of several southern establishments, and in other cases managers whose opinions of the raw cot ton market were “ bullish” refrained from taking on sufficient business to keep their mills busy. Other managers, who did not believe that cotton quotations would advance greatly, have been able to obtain sufficient orders to keep their mills running two shifts daily, or 105 hours per week. New England spin ning mills are reported to be still inactive. In the face of the dull demand and the fluctuating cotton market, neither spinners nor dealers will run the risk of accumulating heavy supplies, and in spite of considerable amounts shipped here on consignment, stocks at present are light and are decreasing. In relation to the volume of business, the reserves are now much smaller than at this time last year. Because orders are slack and the margin between the selling price and the cost of spinning is small, it is natural that yarn quotations should follow the price of the raw commodity very closely. This tendency has been particularly noticeable in the case of heavy carded yarns, in which the cost of the raw material forms a large part of the production ex pense. In spite of the fluctations, spinners’ prices have been growing firmer; but since raw cotton began to decline, yams actually in stock have been selling at concessions. Collections have been fairly good. Trading in cotton goods is very slow, for the de clining price of raw cotton, the seasonal dulness, the depression that is affecting all textiles, 0 and the ever-present strikes, have caused the demand for cotton goods to diminish. The situation is very uneven, some lines being in much greater request than others. For example, heavy fabrics such as flannelettes, sheetings and denims are in moderate demand, but printed wash fabrics and fine goods of a semi-staple character are selling poorly. However, those fancy wash goods which are novelties, such as modified ratines, continue in lively demand, and manufacturers expect a con tinuance of the vogue for ratines, swisses and tissues. Until the Amoskeag mills have sufficiently recovered from the strike to announce their gingham prices for next spring, this fabric will probably show little ac tivity. As a result of the many uncertainties which surround the market, buyers are extremely cautious and orders are small in size, many of them being merely for sampling. There is a constant search for something new that will sell readily. Although some orders are being placed for the future, the majority are for delivery immediately. In fact, manufacturers decline to accept orders further ahead than 90 days, because they cannot predict the future price of the raw material. Mills in this district are running at 75 per cent of capacity on a one shift basis. Southern mills have somewhat reduced their production schedules, and in general are only running one shift a day. It is not usually satisfactory to make colored fabrics at night, and night work is always less profitable in cases where the operations are not purely mechanical, as in spinning, but require much human labor. In spite of the fact that the strike in the New England textile centers still exists, the mills are taking back their operatives slowly. An idea of the extent to which the strike has lessened the output of cloth may be gained from the estimates of the Daily News Record, which computed the production lost from the begin ning of the strike until August 5 as 295,967,634 yards. Although both jobbers and retailers have small supplies of cotton goods, the stocks held by manu facturers, though decreasing, are moderately heavy. The result is a sharp competition for business, which has resulted in some price irregularities. But in gen eral the tone of the market is much firmer. Prices of gray cloths have fluctuated but little, and quota tions for many fine fabrics, such as soisettes, are the same as last year. In the latter type of goods, the profits made last year were sufficiently large to absorb 18 the advances in yarn quotations, and this year buyers strongly resist attempts to raise prices. With the exception of skilled weavers, who are reported to be difficult to obtain in some sections, labor, both skilled and unskilled, is plentiful. The strikes have not only affected the mills through the scarcity and extra cost of coal, but have delayed shipments and curtailed the purchasing power of consumers. They have served to make the textile outlook even more discouraging. Collections may be described as being from fair to good. WOOL The demand for woolen and worsted goods, in general, cannot yet be called satisfactory, but, as some lines are much more active oolen and than others, they must be detvors e goo s scrj^ec| separately rather than col lectively. The demand for staple cloakings for women’s wear is good, but the sales of dress goods have been very conservative. Buyers are very hesi tant, because of the uncertainty regarding the tariff and the predicted style change to longer skirts. If the latter are generally adopted by women this fall, sales of the lighter weight dress goods will undoubt edly be stimulated; but at present buyers are un decided as to whether serges, tricotines, or poiret twills should be purchased. Although the demand for men’s worsteds is still slack, some improvement is noticeable in the sales of fabrics having a design or color which is new. The increasing use of “ tropical” worsteds for rnen’s summer wear and the ban which fashion has decreed against the use of serges for women’s apparel have resulted in making the demand for serges very poor. In comparison with the demand of a year ago, that for woolens has barely held its own; but the call for men’s wear has improved. It is not sur prising, then, that most of the future orders now being placed are for goods for men’s wear, or that dress goods are being ordered for immediate de livery only. The coal and railroad strikes have indirectly af fected the demand for all kinds of goods bv making retailers very cautious as regards commitments. It is of note, however, that one large company has al ready withdrawn most of its lines, not only of spring woolens but of fancy worsteds also. Although a few worsted mills that are exceptiona% fortunate are running nearly all their looms during the daytime, the average percentage of opera tions for the worsted mills in this district does not exceed 55. The woolen mills are less active than they were last spring, their present rate of production being about 75 per cent of capacity. In the country as a whole, the percentage of operations during July, as reported by the Bureau of Census, was 64.1 for wide looms, a gain of .5 per cent over that of the previous month, and 71.5 for narrow looms, an in crease of 4.9 per cent. During the last month, manufacturers in this dis trict have announced their opening prices for next spring’s lines. Many mills have followed the ex ample set by the American Woolen Company last month, and while making the prices of serges and worsteds exceedingly attractive in order to stimulate sales, have raised the prices of woolens over last year’s opening quotations. However, others have advanced the prices of worsteds as well as woolens. Thus, in spite of low opening quotations announced by those who hold considerable stocks of cheaply bought yarn, prices are tending upward. Stocks of novelty fabrics held by the mills are light; but supplies of staples, although decreasing, are moderately heavy. Collections are fairly good and are improving. The demand for worsted yarn was extremely poor during July and August, but spinners are now more hopeful because of the Woolen and larger number of inquiries from worsted yarns knitters. Owing to the seasonal dulness and the uncertainty about the tariff, the de mand has been so flat that there have been few orders, and those which have been placed have been for immediate delivery. Spinners have hesitated to place yarns in stock, and supplies in first hands are therefore light. In this district, woolen spindles con tinue to be much more active than worsted, of which only 60 or 65 per cent are turning. That the same condition is true of the country generally is shown by the figures of the Bureau of Census, which re ports that in July 83.7 per cent of the woolen, and 68 per cent of the worsted spindles were active. Yarn prices continue firm. Although they have steadily advanced during the year, they have not in creased as rapidly as the prices of raw wool. In the past twelve months, yarn prices have risen from 25 to 33 per cent, whereas wool quotations have ad vanced from 80 to 100 per cent. Collections are fairly good and have changed but little since last month. Because of the seasonal lull in the textile industries and the hesitancy of spinners in buying their raw 19 material, the demand for raw wool was almost nil between July 15 and August 10. Since the latter date, however, dealers have reported increased interest, and especially in medium wools. Most orders are for spot delivery. In spite of the lack of demand, the level of prices has been remarkably well maintained. Although a softening occurred of one or two cents per pound, the fall in price was insignificant because of the strong statistical position of wool. That the level of raw wool quotations is higher than the general level of wholesale prices is shown by the chart below. More than 50 per cent of the domestic clip has already been sold, but a considerable volume is still held by the growers in Montana and Texas. In these districts, the bids of dealers were rejected earlier in the summer. A fair quantity of wool is being taken out of bond for use in fine worsted cloth, and some owners of bonded wool have found it profitable to re-export it to Europe. Stocks in dealers’ warehouses are fairly low, but are being slightly increased. Moreover, many mills are under-stocked, and those now find themselves at a disadvantage with mills which possess ample quantities of low-priced wool. The foreign market is strong, and the demand for merinos is good. Although the demand for cross breds was greatly reduced by the inability of conti nental Europe to purchase its usual large amount, the British-Australian Wool Realization Association has withdrawn from sale the large over-supply of cross-bred wool and thus strengthened the market. Wool prices since the beginning of 1922 have again risen above the price index of all com m odities. Ohio fine delaine quotations have been converted from the grease basis to the scoured basis by assum ing a shrinkage of 60 per cen t. Sources—War Industries Board, “Bradstreet’s”, “Textile World” and Bureau of Labor Statistics. SILK The demand for silk goods has diminished, partly because of the mid-summer lull which has affected ^ all textiles, and partly because of the handigoods caP high prices and unfavorable edicts of fashion. Since July 15, sales have decidedly decreased. Although there are now very few orders either for spot or future delivery, those orders that are placed are for immediate shipment. The one exception to the general dulness is the demand for crepe fabrics, which continue to sell readily. At present, Canton crepe, crepe de Chine, crepe satin, and georgette are selling actively. Since the public demands originality, the novelty silks are finding a ready market, but taffetas and messalines can be sold only at a sacrifice of price. The demand for ribbons, both broad and narrow, is extremely low, but of the two widths the latter sell more easily because of their more varied uses. It has been reported that although ribbons sell but slowly at the prices usually quoted, they can be disposed of rapidly at heavy reductions. With the exception of concessions on yarn-dyed goods, prices remain firm but unchanged. Because they consider that the current demand is not strong enough to permit of the higher quotations that would be necessary on products made from silk bought at present prices, manufacturers are hesi tating to produce for stock, and mills have not in creased operations, which last month were 50 per cent of capacity. However, many establishments making crepes exclusively are working on full time, and in spite of a strike, the plants at Paterson, which previously were working at only 20 per cent of ca pacity, have increased operations. On account of the fluctuations in raw silk quota tions, manufacturers have refrained from purchasing at current prices except for their immediate needs. Consequently, they hold light stocks of raw silk, many having only enough for 30 days. As was the case a month ago, supplies of finished goods in first hands are still heavy, but they are now decreasing. Stocks of the yarn-dyed silks, which are not in de mand, are especially burdensome. Although collections are better than they were at this time last year, they have improved but little since last month. Unskilled labor is plentiful, but skilled labor, according to some reports, is not read ily obtainable. Like that for broad silks, the demand for thrown silk is small and is decreasing. In comparison wit*1 20 the same period of last year, orders are more numerous, but they are mostly for crepe yarns for immediate delivery. Hosiery mills show little activity. Throwsters are somewhat more active than the broad silk mills, and in this district their establish ments are running at an average of 65 per cent of capacity. Prices have followed closely the fluctua tions in the raw silk market. Owing to the uncer tainty of raw silk prices and to the large proportion of the throwing done on order, the throwsters’ sup plies, both of raw and thrown silk, are light. Collections are fair, but though they show im provement over those of last year, there has been no change since last month. Ever since the prices of raw silk made one of their spasmodic advances late in July, the market has ^ been weakening. This decline, which has silk amounted to about 35 cents a pound, has re sulted from the lack of demand and from the promise of a heavier crop during the coming season. The sluggishness of the demand has in turn been due to the fact that manufacturers consider that raw silk, at current quotations, is too high to be purchased in face of the stiff resistance to all attempts to advance the prices of finished products. Moreover, there has been lack of confidence in the permanency of the Present price level. That the quantity of silk bought by silk mills has been declining is confirmed by the figures of the Silk Association given in the table below, for only 24,996 bales were delivered to mills in July, as compared with 33,284 in May. silk It will be seen from the preceding table that in July imports decreased by more than 10,000 bales. However, the total imports of raw silk were even greater in the fiscal year ending June 30, 1922, than during the banner year ending in 1920. The com parative size of the imports for each year since 1918 and the growing preponderance of Japanese silk are shown by the table below: IMPORTS OF RAW SILK _________(In bales)_________ 1918* Japan ................... 221,011 Canton .............. 19,039 China ................... 21,110 Tussah ............... 4,986 European .......... 57 266,203 1919* 1920* 213,922 17,226 24,968 4,297 304 260,717 1921* 1922* 214,399 159,977 282,450 34,066 26,689 40,559 32,713 21,582 16,810 6,279 1,406 5,441 12,637 8,256 9,103 300,094 217,910 354,363 * Fiscal years ending June 30. That the imports of 1922 have increased enor mously in spite of the fact that 'American production was curtailed at least 50 per cent, may be attributed to the vogue for the heavy crepes; and to the exten sive use of silk in knit goods. The demand for artificial silk is spotty, and al though the 150 Denier size is extremely plentiful, the 300 Denier size is scarce and commands a pre mium. Artificial silk has been found so satisfactory for use in fancy mixtures with worsted yarn, and in the manufacture of hosiery and knit goods, that it bids fair to become a strong competitor of natural silk. The relative consumption of natural and artifi cial silk is portrayed by the accompanying chart. IMPORTS, STOCKS AN D DELIVERIES OF RAW SILK IN TH E U N ITED STATES (In bales) 1921 June .. July J j j l 1922 Imports Storage at Storage at Approximate deliveries to 1st of month during month end of month American mills II 20,541 15,521 26,172 34,670 15,521 17,866 31,192 32,325 22,077 19,268 20,826 26,895 21,438 34,842 35,598 25,575 19,263 20,826 26,895 27,474 24,247 33,284 29,529 24,996 The quantity of silk in storage somewhat increased Ur*ng July, but the whole amount stored in public Warehouses is approximately equivalent to only one Month’s consumption, and, as has been mentioned, ?.tocks of raw silk held by the mills in this district are ^bt, the average supply being also sufficient for 0n'y 30 days. 21 Source*— "S ilk Worm” and "M onthly Summary of Foreign Commerce.” Nearly all of our raw silk imports are consumed in this country, and the production of artificial silk plus the imports approximately equals the quantity con sumed. It will be seen that in 1913, our imports of artifi cial silk were in excess of our production, but that in 1921 the relationship had been reversed because the output of the mills in this country increased tre mendously. The production and imports since 1913 are shown by the following table published by the Silkworm: Domestic production (in pounds) 1921 1920 1919 1918 1917 1916 1915 1914 1913 ................... ................... ................... ................... ................... ................... ................... ................... ................... 15,000,000 8,000,000 8,000,000 5328,000 6,687,000 4,744,000 4,111,000 2,445,000 1,566,000 Imports of artificial silk (in pounds) A summary of the business done by reporting firms in the Third Federal Reserve District follows: OPERATIONS IN THE HOSIERY INDUSTRY (In terms of dozens of pairs) Number of reporting firms—36 Firms selling to the wholesale trade: Product manufactured during July Finished product on hand July 3 1 . . Orders booked during July............... Cancellations received during July. Shipments during July....................... Unfilled orders on hand July 3 1 ... July, 1922 July, 1922 compared with compared with June, 1922 July, 1921 —20.3% — 1.0“ —17.7 “ —61.3 “ —27.8 “ —11.8 “ — 1.5% +35.9 “ —34.0 “ — 3.4 “ —18.7 “ —15.4% — 5.4 “ —14.7 “ —19.1 “ +20.7 “ + 3% +74.6 “ — 3.4 “ '+ 7.7 “ —34.5 “ Number of reporting firms—13 Firms selling to the retail trade: 3,667,180 1,846,875 1,148,513 93,099 552,000 864,000 2,718,000 2,923,000 2,305,000 Product manufactured during Tulv Finished product on hand July 3 1 . . Orders booked during July.............. Cancellations received during July. Shipments during July....................... Unfilled orders on hand July 3 1 ... UNDERWEAR HOSIERY The reduction in new business received by hosiery manufacturers, which we noted last month, has now reached such a point as to cause the temporary clos ing of a number of mills and the partial curtailment of production in many others in this district. This dulness is probably partly seasonal, but has no doubt been accentuated by the railroad and coal strikes. Another element that has added to the hesitancy of buyers is the increase in the length of women’s skirts and the consequent problem as to the kind of hosiery that this change will favor. Moreover, many buyers had contracted for a fair percentage of their fall re quirements and are therefore able to wait until busi ness conditions become more settled before making further commitments. All kinds of hosiery appear to share in this decrease in business. Even the fullfashioned mills, which have for many months had orders for all they could produce, are now making very few new contracts. Prices for both finished goods and raw materials show only trifling changes, but the slackening in buy ing by the mills has served to check the advancing markets in silk, wool, and cotton yarns. The supply of labor, both skilled and unskilled, is more plenti ful than it has been for several months; which is an other result of the curtailment in production. How ever, no change is reported in the scale of wages. Collections have become slower and by a number of firms are said to be below normal. 22 During the past month the amount of business re ceived by underwear manufacturers for the spring of 1923 has been reported so differently by the various mills that it is impossible to estimate, even approxi mately, what relation it bears to the total usually con tracted for at this season. It can be safely said, however, that a number of manufacturers have sold their normal quota and that the total business taken has been of considerable magnitude. But the prices obtained have not been satisfactory to the sellers, be cause of the high prices of yams. Most of the con tracts were made promptly at the opening of the various lines. Since then, however, neither buyers nor sellers have been especially anxious to increase their commitments, the buyers hesitating because of the unsettled conditions engendered by the strikes, and the sellers because of the unsatisfactory prices obtainable. Heavy weights for fall have been bought sparingly, and it is now believed that most of the trade have purchased sufficient for their early season wants. Of course, there remains a balance yet to be placed and such orders will be received from time to time for some months to come. Y am prices have fluctuated within comparatively narrow limits, but at the present time are strong owing to the advance in raw cotton. Collections &re reported to be only fair. summary of the business done by firms in the Third Federal Reserve District follows- A reporting CONDITIONS IN THE UNDERW EAR INDUSTRY (In terms of dozens) Number of reporting firms— 14 Summer underwear: Product manufactured during July Finished product on hand July 31.. Orders booked during July.............. Cancellations received during July. Shipments during July....................... Unfilled orders on hand July 3 1 ... July, 1922, July, 1922, compared with compared with July, 1921 June, 1922 - 57.8% - 5.7“ + 89.5 “ — 53.0 “ +185.4 “ — 79.7% + 109.5 “ +422.5 “ — 55.2 “ +111.0 “ Number of reporting firms—10 Winter underwear: Product manufactured during July Finished product on hand July 31.. Orders booked during July.............. Cancellations received during July. Shipments during July....................... Unfilled orders on hand July 3 1 ... — 9.0% — .7 “ —39.3 “ +70.9 “ + -1“ FLOOR COVERINGS The demand for floor coverings of nearly all kinds has been unusually good for this period of the year. Manufacturers of carpets and rugs have for the most part sold their production for the balance of the season, and samples for the fall openings are being prepared. Prices have been advanced by two of the largest houses, by an amount equal to about five per cent, and this is thought to be an indication that prices generally for the next season will be higher than they were at the spring openings. Indeed, several lines are being offered, for November and subsequent delivery, at about five per cent over April figures. The strength of raw material prices is given as the reason for the advances made. The strike of weavers in two Wilton mills, reported by us last month, continues, but new men are gradually being taken on and production in these plants is increasing. The linoleum business is still extremely good, and sales are at least equal to production, which is main tained at full capacity. Advances in price of from three to five per cent have been by some manu facturers. Deliveries are reported as being late be cause of the large volume of orders already booked. The coal strike has not caused any reduction in the 0litput of floor coverings, as manufacturers have been able to secure sufficient fuel for their needs. The c°ntinuance of the coal and railroad strikes has caused a slackening of orders from certain localities, fiut the business as a whole has not been disturbed; freight deliveries in some sections of the country, nc>tably the south, have become slower. Retail sales are so large that, notwithstanding fairly consistent buying, stocks carried in retail establishments are n°t heavy. Demands for immediate express ship ment indicate that there are numerous cases of actual shortage of supply. Collections are good, and there are very few slow accounts reported. LEATHER Shoe manufacturers in this district have received a good proportion of the orders usually placed for early fall delivery, but a very limited busiShoes ness has been done for shipment extending beyond September. The placing of this later business has undoubtedly been retarded by the coal and railroad strikes, which caused late July and early August sales at retail to become even smaller than usual. The inevitable result has been that the retailer finds himself left with a somewhat larger stock than anticipated, especially of white shoes, and having al ready bought a fair line for early autumn wear, de clines to place further orders. Shoe prices are firm and a number of manufac turers have announced small advances. This change in price was made necessary by the increased cost of many lines of leather. The demand for patent leather shoes continues, but calf and kid in both black and brown are also popular. Satin, too, is being sold in fair quantities. A new and very popular shoe is one of colonial pattern with severely plain lines and a prominent tongue. The Department of Commerce reports that the output of shoes during the first half of 1922 totalled 159,414,058 pairs, distributed by months as follows: January ................................................................................. February .............................................................................. March .................................................................................... April ....................................................................................... May ........................................................................................ June ........................................................................................ 25,173,437 24,900,185 29,686,011 27,193,801 26,901,540 25,559,094 If this rate of production continues during the second half of the year, the total for 1922 will be nearly 320,000,000 pairs. This figure compares with 292,666,048 made in 1914 and 330,644,022 pairs in I 9 *I9CONDITIONS IN THE BOOT AN D SHOE INDUSTRY Number of reporting firms—41 (In terms of pairs) O rd e rs on hand....................................... S tn rk s nn hand....................................... Number of operatives on payroll... July, 1922 July, 1922 compared with compared with June, 1922 July, 1921 — 7.9% —26 2 “ —22 4 “ + 9.7 “ + 8.2 “ — .3 " +10.2% + 3.3 “ +20.6 “ —16.9 “ +182 “ — 2“ Manufacturers and jobbers report that collections are slower than they were a month ago. During July, production of shoes in the Third Federal Re serve District, as shown herewith, decreased 7.9 per cent as compared with that in June, 1922, and in creased 10.2 per cent as compared with July, 1921. Sales at retail during July were much below those of June. This, however, is largely a seasonal con dition. RETAIL SHOE TRADE (In terms of dollars) 1. N et S a l e s : (a) July, 1922, as compared with June, 1922... (b) July, 1922, as compared with July, 1921... (c) July 1 to July 31, 1922, as compared with July 1 to July 31, 1921................................. 2. S tocks (selling price) : (a) July, 1922, as compared with June, 1922... (b) July, 1922, as compared with July, 1921... 3. Rate of T urnover (times per year based on cumulative period) : (a) July 1 to July 31, 1922 ....................................... (b) July 1 to July 31, 1921....................................... Number of stores reporting above item s: la ----- ....2 6 2a___ ....1 6 l b .... ....2 6 2 b .... ....1 6 l c . ... ....2 6 3a___ ....1 6 3 b .... ....2 2 —31.4% — 8.1“ — 8.1“ — 6.8% —17.1“ 2.5 2.3 Sales of leather have been large, and the market has been a broad one, covering all lines and grades. Prices are higher, and this advance apLeather pears rather to have stimulated than re tarded business. This, however, should not be construed to imply that a further advance would be followed by a still greater increase in sales. In fact, many in the trade feel that a further rise in prices would be more likely to curtail business. Shoe manufacturers show more disposition to stock leather than they have during past months, and in many instances have not only covered their require ments for shoes sold, but have anticipated their further needs. In heavy leathers the whole line is moving better. Butts in particular are strongly held, and the price for No. 1 has been advanced to 70 cents per pound, following sales in fair volume which were made at 68 cents. Leather belting sales have shown a steady gain of about 10 per cent during each of the last four months. This increase, however, en couraging as it is, should not be misconstrued, since sales are now only about two-thirds of the pre-war volume. Stocks, although diminishing, remain large. In sole leather and offal, not only are prices higher but liquidation of distress stock has ceased, and the price cutting consequent to such forced sales has greatly lessened. The higher price now being secured is therefore greater than a comparison of the quoted figures would indicate. Stocks of all grades of heavy leathers are diminishing, but are fully adequate. In upper leathers, conditions are similar to those in heavy leathers. Sales are large, price advances are general, and price-cutting, which had been the rule, has almost ceased. Production has increased, but as consumption has gained more rapidly, stocks of nearly all kinds and qualities of upper leather are lower. Patent leather continues to lead in popularity, and prices have advanced probably more on that than on any other leather. Calf, both in black and brown in all weights, is selling freely, and brown ooze calf leather is being used extensively in fashionable shoes. But probably the greatest change in the entire leather trade is in kid leather. Tanners are producing more than heretofore, and it is only the shortage of desir able goat skins that has prevented still further ex pansion in output. Sales, however, are running ahead of production, and stocks, especially in low grades and in large skins, both of which were in heavy supply, are considerably smaller. Sheep leather is also in good demand, for linings, hat leathers, and chamois; and a slight improvement is noted in the glove leather trade. Exports of sheep leather are larger, and some new markets for hat leather and chamois are being opened. Foreign shipments of heavy and upper leathers continue to gain slowly. Scandinavia has been buy ing kid leather in better quantity than for some years, and general European business in leather, except to the Central States, is going steadily forward. Ac cording to figures of the Census Bureau, exports June, 1922, and June, 1921, were as follows: Patent leather, sq. ft......................................... Sole leather, lbs.................................................. Calf leather, sq. ft............................................. Kid leather, sq. ft............................................... June, 1922 4,327,228 1,845,058 2,326,442 4,293,064 June, 1921 1,903,836 765,231 531,872 2,199,03/ These figures demonstrate very clearly the progress made during the past year in recovering some of the lost foreign trade. The following figures compiled likewise by the Census Bureau of the Department of Commerce, show the decrease in stock of the principal leathers during June. They indicate that the whole leather business is working into a stronger position. Sole leather—decreased ................................................. 2.3 Belting butts—decreased ............................................... 4.4 Cattle side (upper)—decreased...................................4.5 Calf and kip—decreased................................................. 2.4 Goat and kid—decreased................................................. 1.4 Cabretta—decreased .........................................................5.1 Sheep and lamb—decreased........................................... 8.6 per per per per per per per cent cent cent cent cent cent cent The shortage in coal has had no effect on either the Prices throughout the industry remain practically production or sale of leather. Tanners report that the same as a month ago. Though there have been they either have a stock of coal, or by paying the no advances of any importance, the industry has been price demanded have been able to secure sufficient for greatly disturbed by the uncertainty of a continued their needs. They are far enough removed from the supply of raw materials, and especially by the uncer ultimate consumer to have failed as yet to feel the tainty as regards prices. Mills have withdrawn all lessened demand for shoes at retail. quotations for future deliveries, and purchasers will Collections are reported as being very good. be compelled to pay the price prevailing at the date Hides continued to advance during the early part of shipment. Wholesalers and jobbers, however, of August, and heavy native steers sold at 20 cents must abide by their catalogue prices or by certain per pound. This appeared to be the definite increases which they elect to make. They *stdns sellers’ goal, and after that the market are thus placed in the position of being compelled to became less active. Foreign hides ad gamble on the market with an unprotected mill price. The accompanying chart shows that book and vanced in sympathy with domestic, but following the advance, also became quieter. The position of hides, however, remain strong, owing to the small visible supply. There is no doubt that herds were greatly depleted the world over during the period of high prices, and in countries such as Mexico, where con ditions were unsettled, were reduced to a point from which it will take some years to recover to a normal number of cattle. Calf skins gained one cent per pound to 23 cents during the same period, and likewise have become less active. Goat and sheep skins shared in the advanc ing prices, but tanners are now hesitating to follow the market, feeling that to do so would not only be taking a considerable risk, but would necessitate a further advance in leather that might prove extremely detrimental to business. As an example of one of the extreme advances, Brazil goat skins, which were quoted at 65 cents per pound a little more than two uionths ago, were recently sold in considerable Source Dun’s Review.” quantities at 95 cents per pound and are now being writing paper and news roll have all shown tremend held for $1.03 per pound. ous declines since early 1921. Writing paper, in PAPER particular, is selling for exactly the same price as it The improvement in the demand for paper, which did in 1915. Writing paper did not start to advance uutil August 1 had continued for several months, has till almost six months after both book paper and news been temporarily checked, and in certain lines sales roll were on the increase, but when the depression show a slight decline. It is true that some of the came, it remained at its peak price for a period of targest manufacturers, especially of book and wrap six months after both book paper and news roll had ping paper, still note small increases over June and declined. Stocks held by the mills are normal, though a few July sales, but wholesalers selling to the printers re have heavier stocks than usual on hand. Some plants port a falling off. The coal strike is a very disturbing factor in the report slight labor difficulties, but there have been no Paper industry. Practically none of the larger paper increases as yet, and 30 cents an hour is the standard uulls have shut down on account of the coal shortage, wage for unskilled workmen. Manufacturers say that their collections are sat hut the majority have only a thirty days’ supply of isfactory, but the large majority of the wholesalers Tiel, and if prices continue to advance, they may be and jobbers report difficulty in keeping their accounts compelled to close. Most of the mills are operating in a satisfactory condition. at 100 per cent of capacity. — “ 25 PAPER BOXES Manufacturers of paper boxes report that the de mand for their goods is almost the same as it was during July. The increases in business, which had occurred almost monthly up to that time, have not continued during the month of August. Sales of silk and cotton hose are both dull, but manufacturers of men’s shirt boxes and of boxes for the hardware and confectionery trade note considerable improve ment. O f course, better business in the confec tionery box trade is to be expected at this season of the year, and though certain firms have started work on their fall and holiday orders earlier than usual, there is no indication of any great improvement in demand. Plant operations are relatively unchanged and are still from 65 to 80 per cent of capacity. Only the exceptional firms are operating on full time. The raw material situation is unsatisfactory. Prices are advancing rapidly, and all materials used in the industry are much higher in price than they were a month ago. Some manufacturers report that within the last week further advances have been made. The prevailing price of chip board at the present time is from $45 to $50 a ton, as compared with the standard quotation of $37.50 a little over a month ago. Straw paper, for use in corrugated boxes, has risen from $40 a ton in July to $70 a ton at the present time. Jute liner is now selling at close to $77.50 a ton, an advance of nearly $20 over July quotations. Paper mills withdrew all quotations nearly a month ago and have since then refused all orders except at such prices as prevail on the date of shipment. One large mill making chip board was compelled to close down on account of the coal shortage, but it has now reopened on a 100 per cent basis; several others are operating on coal which they secure from day to day. Up to the present time box manufacturers have advanced prices only enough to cover the increase cost of raw materials. Collections are poorer than they were a month ago and are reported to be generally unsatisfactory. RUBBER The demand for mechanical rubber goods, which was fair in June, has since diminished because of the . coal and railroad strikes. The strikes BgoodsCa ^ave no* on^ decreased general pur chasing power and added to produc tion costs, but have materially affected the orders from iron and steel plants. The number of inquir ies, however, is large, and this has made manufactur ers hopeful. But sales have not yet increased. The cement mills and oil refineries, however, are very active and are purchasing heavily of hose and belt ing. Contractors and railroads are also buying, but the latter show a tendency to order their supplies in relatively small quantities. Although there has been some future buying, the majority of orders are for delivery within thirty days. Because of the slackness of demand only a few factories have been running at capacity, and the per centages of operations average about 65. Although reports are conflicting, the present stocks of many plants in this locality are light, and as compared with those of the first of the year, most inventories of fin ished products are now smaller. In spite of a slight downward trend, prices of mechanical goods remain unchanged. Collections are fair, and in comparison with those of a year ago, show great improvement. Not only did the rubber industry feel the effects of the present depression more quickly than did most lines of business, but it felt them more L Ltires severely- It ^ of ah the greater signifi cance, therefore, that the manufacture of rubber products, and especially of tires, has been one of the first industries to recover its former activ ity. In fact, the demand for tires during this season has been so good that the volume of sales compares favorably with that of the banner months of 1920. Enhanced by the need for original equipment to out fit the enormous number of new automobiles, the de mand for tires has shown a steady growth month by month and has greatly exceeded that of last year. Nevertheless, there are indications that the usual sea sonal decline of the last three months of the year has already begun. This may be accounted for by the hesitancy of buyers resulting from the price-cutting “ war.” Hoping that prices may be further reduced, buyers who could wait have naturally postponed their purchases. On July 15 one company made reduc tions which averaged 28 per cent; and other large companies have lowered prices, either by slashing their consumers’ price lists or by offering an inner tube free with each casing or by increasing the dis count to dealers, all of which will lower the price to the consumer. The price fluctuations that have occurred since 1914 are indicated by the following tabulation, from the Street Journal, of the consumers’ prices of the Goodyear and Goodrich Companies for two standard sizes : Wall 26 1914 (January) Goodyear ......................... Goodrich ......................... 1915 (February) Goodyear ......................... Goodrich ......................... 1916 (January) Goodyear ........................... Goodrich ........................... 1917 (January) Goodyear ........................... Goodrich ........................... 1918 (January) Goodyear ........................... Goodrich ........................... 1919 (January) Goodyear ........................... Goodrich ........................... 1919 (May) Goodyear ........................., Goodrich ........................... 1920 (March) Goodyear ........................... Goodrich ........................... 1920 (November) Goodyear ........................... Goodrich ........................... 1921 (May) Goodyear ........................... Goodrich ........................... 1921 (November) Goodyear ........................... Goodrich ........................... Present (August 5, 1922) Goodyear ........................... Goodrich ......................... ' FABRIC 30 x ZVi 34 x 4y2 $18.40 17.00 14.20 12.50 15.60 13.40 17.95 14.70 21.35 15.10 23.50 20.65 20.00 18.70 23.50 23.20 20.00 20.00 17.50 16.00 14.75 13.75 10.65 10.65 30 x CORD the little companies, which did not have these com mitments and which, therefore, could buy their raw materials at low prices. Not until the large firms had used their dearly bought raw material were they in a position to enter the fight to fill the demand for cheap tires. They have reached that position now, and they have cut prices to such an extent that the competition is the fiercest in the history of the in dustry. Not only are the big companies reducing the prices of their high quality tires, but they are also making some sub-standard tires of slightly inferior grade, which are designed to fill the demand from customers who prefer to sacrifice quality for cheap ness. As has been mentioned, the existence of consider able stocks of tires and tubes may have had an in fluence upon prices. The following table shows the inventory on the last day of the respective months, and also the production and shipments of about 65 manufacturers, as reported to the Rubber Associa tion of America, Inc. In this district, manufacturers report that their stocks are low, but it is probable that the tremendous pro duction in the great tire-making centers has pre vented the heavy surplus which existed on June 1 in the country as a whole from being greatly reduced. In the Akron region alone it is reported that the daily output has been 100,000 tires. In the Third Federal Reserve District about 80 per cent of the plant capacity is being used. As shown by the chart on page 28, the manu facture of pneumatic tires expanded so greatly between 1914 and 1919 that in The changing the latter year 133 per cent more status of the power was used and 158 per cent rubber industry more people were employed than in 1914. Moreover, the value added by manufacture, which represents the dif ference between the total value of the finished goods and the cost of the raw materials used in their production, increased 373 per cent. That there has been a tendency toward the growth of large establish ments is shown by the fact that whereas the number of workers increased 158 per cent, the number of zy2 34 x A'/i $38.60 $3225 39.35 31.65 26.90 27.30 38.40 28.50 ... 30.05 40.00 32.75 31.20 48.40 37.85 34.15 53.25 41.65 46.60 45.25 26.45 42.75 26.00 53.25 31.15 53.15 31.15 47.95 31.15 47.95 31.15 40.30 24.50 38.05 24.50 36.25 18.00 35.65 18.00 30.80 14.65 15.95 $52.90 46.20 43.40 38.95 49.95 44.90 52.75 49.25 60.95 62.25 67.05 62.25 57.00 55.80 67.05 67.05 62.05 62.05 54.90 49.65 43.90 43.90 39.50 39.50 It will be seen that the present prices are not only 40 per cent lower than the peak quotations of March, 1920, but are the lowest ever quoted by these com panies. The recent reductions by the big manufacturers may be ascribed largely to their desire to reduce competition, although a heavy stock of tires may also have had an influence. Many small manufacturers were attracted to the industry by the high profits made during the boom period. When, in 1920, the prices of raw rubber and cotton fabric suddenly dropped, the large companies were caught not only with heavy stocks of high-priced raw materials but also with contracts signed before the prices declined. Consequently, the big manufacturers were im mediately placed at a disadvantage as compared with (000’s omitted) LUne, 1921 ?ePt., 1921 Jan., 1922 April, 1922. May, 1922, June, 1922 P n e u m a t ic C a sin g s Inventory 4,154 3,341 4,174 5,464 5,523 5,042 27 Production 2,313 1,929 2,055 2,401 2,722 2,839 Shipments 2,644 2,048 1,597 2,087 2,639 3,133 Inventory 3,835 3,828 5,247 7,230 7,190 6,187 I n n er T u bes Production 2,360 3,275 2,343 2,651 2,971 3,131 Shipments 3,253 2,646 1,890 2,329 2,939 3,974 in this country is indicated by the following figures showing the registration in each year. AUTOMOBILE REGISTRATION AN D PRODUCTION Year 1914 1915 1916 1917 1918 1919 1920 1921 The growth of the industry as a whole since 1914 and the pronounced increase in the size of individual plants are noteworthy. Source—Bureau of the Census plants increased only 45 per cent. The following table shows the relative changes during this fiveyear period in three branches of the rubber industry. Rubber tires and tubes Increase 1914 1919 301 437 452% Number of establishments... Persons engaged in the in 62,257 160,842 158.3 “ dustry ...................................... Primary horsepow er............... 151,927 354,188 133.1 “ Value added by manufacture. 97,499,111 461,401,736 373.2 “ Rubber boots and shoes Increase 1914 1919 _ 25 23 Number of establishments... Persons engaged in the in 20,359 37,929 dustry ...................................... 49,400 24,621 Primary horsepow er............... Value added by manufacture. 29,866,087 66,570,554 86.3% 100.6 “ 122.9 “ Rubber belting and hose Increase 1919 1914 — 15 18 Number of establishments... Persons engaged in the in 6,205 7,449 dustry ....................................... 26299 22,995 Primary horsepow er............... Value added by manufacture. 10,593,885 15,900,139 20.0% 14.4 “ 50.1 “ It is evident that the enormous gains made by the rubber industry must be largely attributed to the manufacture of tires and tubes. Since less than two per cent of our tires and tubes are exported, the growth is due to the more extensive use of trucks and pleasure cars within the United States. To what an extent the number of automobiles has increased 28 Number of cars Passenger cars Motor trucks produced produced registered .................................. 1,711,339 .................................. 2,445,664 .................................. 3,512,996 .................................. 4,983,340 .................................. 6,146,617 .................................. 7,558,666 .................................. 9211295 .................................. 10,448,632 543,679 818,618 1,493,617 1,740,792 926,388 1,657,652 1,883,158 1,514,000 25275 74,000 90,000 128,157 227250 316,364 322,039 154,550 The large number of tires needed for original equip ment on the new cars has added materially to the demand. However, this advantage has been some what counteracted by the fact that the average period of service of each tire has been lengthened by the shift from fabrics to cords, by the better quality of the raw materials, and by improvements in the proc ess of manufacture. Whereas in 1913 each car con sumed on the average five tires during the year, the consumption is now computed to be only 3.5 tires per car each year. So important has this factor become that many manufacturers fear they have made tires of such high quality that not enough replacements will be needed to keep their large establishments oc cupied. Consequently, they have produced the sub standard tire, designed not only to eliminate the small manufacturer, but also to wear out more quickly and thus provide a larger volume of business and a faster turnover. The feature of the raw rubber market continues to be the lowness of quotations, a result of overproduction. Since 1920 the market has °rubber ^een 50 burdened with the yield from the plantations that the prices have fallen far below the cost of the rubber when landed in New York. The trend of prices and the violent fluctuation of imports are indicated in the following chart. Vigorous efforts have been made to restrict the pro duction of rubber, but voluntary curtailment has not been a success, and so far the English and Dutch growers have been unable to reach an agreement providing for the compulsory limitation of produc tion. An alternative plan has been proposed by the Churchill committee that would involve a graduated scale of export duties. Above the maximum list these duties would be prohibitive. Not only is the current yield far in excess of consumption, but the stocks that are already piled up in the world’s ports would alone be sufficient to supply the demand for a full year. I* The declining price of rubber since 1913, In spite of the increase In con sum ption, has been due to orer-production, caused by the m aturin gof m any plantations In the East Indies. The m ore rapid price decline since 1918 resulted from the expansion of im ports follow ing the release of shipping late in that year. Prices shown are for Para, up-river fine, w hich are m uch higher than quotations on plantation rubber. The latter is now quoted at about 15 cents per pound. Sources—"Monthly Summary of Foreign Commerce” and "Dun’s Review.” is significant that the advance in the rate of exchange with England, which necessarily raises the cost of the rubber delivered in New York, has not yet caused the quotations to advance. According to the Department of Commerce, the crude rubber imports for the month of June amounted to 52 million pounds, as compared with 37 million pounds for May, 1922, and 35 million pounds for June, 1921. Although the total quantity of crude rubber imported during the fiscal year ending June 30 was 583 million pounds, as compared with 377 million pounds for the same period a year ago, the value was almost 23 per cent less. TOBACCO Relatively few changes have occurred in the cigar mdustry since last month. Demand for all grades of cigars, however, is strengthening, and Cigars production is gradually being increased. The majority of the larger firms are now running at full capacity, and among the others, operahons average about 80 per cent. Manufacturers of Heavily selling brands of high grade cigars, who have keen oversold for the past month, report that because they are behind in the filling of orders, they are liable to a duplication of orders far in excess of the actual Fernand. This condition prevailed during 1919 and J920, when, realizing that they could not secure the amount they ordered, jobbers greatly exag gerated their needs in anticipation of having their orders scaled down. A return to such a condition would be extremely unfortunate and leave manufac turers without any means of accurately gauging the real demand. Much has been said of the return of the five-cent cigar, but as yet only two large Philadelphia manu facturers report large sales of such brands; and as quotations on most grades of wrapper tobacco are advancing, manufacturers do not anticipate an ex tension of this business. Up to the present time, the coal and railroad strikes have affected only those manufacturers whose business comes chiefly from the coal mining districts. In these regions stocks on hand at the beginning of the strike have not been sold, and no orders of any size have been forthcoming within the last three months. Stocks of finished goods are very light, as is cus tomary in the industry, especially during the sum mer months. An analysis of the sales of United States Govern ment revenue stamps shows that though five-cent cigars have gained in output, their relative increase, owing to a decline in the general production of cigars, has been much greater. Further analysis in dicates that the larger portion of this gain in class A cigars has been at the expense of class B and does not represent a conversion of cigarette smokers to cigar smokers. The line representing class C, largely composed of ten-cent cigars, has closely paralleled that representing total sales, and at no time has it been out of line with the general trend. In addition to five-cent cigars, class A includes all the stogies, cheroots, and package goods manufac tured in the United States. An important tobacco trade journal estimates the production of these latter commodities would be close to a billion annually. Subtracting this number from class A production, we find that in the year ending June 1, 1922, only 1,705,259.000 class A cigars were made, as against 3,195,508.000 class C cigars. When it is considered that this period covered the return of the five-cent cigar to the American market, the conclusion seems to be that the ten-cent cigar is after all the standard and most sought after size. The chart on page 30 represents the production of the different grades of cigars in comparison with the grand total manufac tured by the entire industry. A few scattered plants report demands for in creased wages, but these have been extremely sporadic, and in only two districts have actual in creases been granted. Collections are good with those manufacturers whose product is in demand, P R O D U C T IO N OF CIG A R S pfpcrm 150 pound, placed upon all imported wrappers by the Emergency Tariff Bill. Havana and Porto Rico are also advancing, though it will be another month be fore definite prices can be secured on the crop, which is now coming to market. AGRICULTURE Weather conditions throughout the district have, * / . /_••••*•_ • /• • • / on the whole, been favorable for crops during the 100 month of August. Some scattering sections, how \ ever, have experienced an excess of rainfall, but %% Lehigh, Blair and Montgomery Counties all report 50 Total districts where lack of rain is interfering with the • ••Ci053 "A" growth of corn, potatoes, and other vegetables. •—-.Closs -•CIOS3 'B' 'C* 0 The United States Department of Agriculture, in 1921 1922 1920 its report on crop conditions in Pennsylvania, says Production of cigars is indicated by sales of internal revenue stam ps. that only oats and tobacco have fallen below the The average for the m onth s of M arch, 1919, the date of reclassification, July 1 forecast. The corn crop in Pennsylvania is to December, 1919, inclusive=100. Source—Internal Revenue Department. reported by the same agency to be 92 per cent of normal, indicating a yield of 44.6 bushels to the acre. and who are in a position to compel prompt payment; The United States Department of Agriculture’s re but they are somewhat slower with many smaller port for New Jersey estimated the condition of the corn crop in that state to be, on August 1, 94 per manufacturers. The supply of all grades of tobacco appears to be cent of normal, and forecast a yield of 44.2 bushels adequate, and no manufacturer reports difficulty in per acre. Estimates for this crop are in both states securing the particular grade he desires far above the average production for the past ten tobacco ^ *s to Pay ^ie Pr^ce- Re_ years. The wheat crop is reported by the same ports from the tobacco growing districts agency to be somewhat larger than last year, though of Pennsylvania are still favorable and a good crop of slightly inferior quality. The Department reports is expected. The Connecticut shade-grown crop has that yields of both oats and barley will be larger this suffered some storm damage and in certain of the year than last, and considerably ahead of the ten-year low lying districts has been spoiled by heavy rains. average. The white potato crop in both districts is In spite of this loss, however, reports agree that a in excellent condition, and returns far in excess of large amount of good tobacco may be expected. those of last year are expected. Estimates of the New co-operative growers’ associations have just Pennsylvania tobacco crop made by the United States been formed in Connecticut and Wisconsin, and in Department of Agriculture are for a smaller output both districts the new organizations are apparently than that of last year. The peach and apple crops supported by the largest and most influential grow are those which have shown greatest improvement ers. Recent reports would seem to indicate that over early estimates, and at the present time it ap these associations will have from 75 to 85 per cent pears from estimates made by the Department that of the crop under their control. Organized along the Pennsylvania apple crop will be nearly five times the lines of the California Citrous Growers’ Associa as great as last year’s, and that the New Jersey crop tion, they are conceded by cigar men to have an ex will be more than three and a half times as great as cellent chance of success. Standardization of the the 1921 crop. The peach crop, which suffered from grade and pack will be of great benefit to farmers and the same killing frosts a year ago, shows a tremen dous improvement this year. The yield of vegeta cigar manufacturers alike. The price trend of filler tobaccos is downward, bles has been very good this year, and potatoes, cab binders are stationary, and wrappers, particularly bages, tomatoes and onions are all much more plen those imported, are higher than at the peak of war tiful than they were a year ago. prices. The excessively high prices of foreign wrap The majority of the counties of the district do not pers are largely accounted for by a scarcity of good report any unusual parasitic pests during the past Sumatra and by the increase in duty of 50 cents a month. Peach scab in Camden County has been 4h \ controlled with some difficulty, and apple orchards throughout the district, which are not thoroughly sprayed, are suffering from scab. Farmers are, on the whole, receiving considerably lower prices for their products than they were a year ago. Wheat, which in 1921 was selling at $1.25, is now selling for 80 or 90 cents a bushel. 'Apples, for which Delaware County farmers in 1921 received $2 per basket are bringing only 50 cents this year. Potatoes, which sold for $1.25 per bushel in 1921, are now selling for 75 cents per bushel. Milk and dairy products, however, as shown by the accompany ing chart, are practically the same as they were a year ago. The standardized price of the Inter-State Milk Producers Association has almost entirely eliminated seasonal fluctuations, and for the past year prices on the Philadelphia market have remained the same. Butter and eggs, however, are subject to vio lent seasonal price fluctuations, as they alternate be tween a large oversupply and under production. Farmers in some sections are replacing their beef cattle with dairy herds. This is largely accounted PRICES OF B U TTE R , EGGS AND MILK CfKTS 50 40 50 20 w VW 5 4 5 A * / V \ s \ z MILK ____j r W pjrqt V 10 M u t * / \ j r •n Urn - - 2 1 1913 1914 1915 1916 1917 1916 1919 1920 1921 1922 1923 Large declines norm ally occur in the prices of dairy products during the sum m er m onths, bu t better m arketing m ethods during the past two years have elim inated these seasonal fluctuations in the case of m ilk. Sources—Department of Agriculture and Inter-State Milk Producers Association. for by their desire to secure better cattle, by the rela tively high price of milk, and by the low prices which steers and home-grown beef cattle have brought. COMPILED AS OF AUGUST 23, 1922 This business report w ill be sent regularly without charge to any address upon request -.............- ....................... ...... 31 V EGGS perdoL / y L* / \ y j \ 7 W vy RESOURCE AND LIABILITY ITEMS of Member Banks In Philadelphia, Camden, Scranton and Wilmington (000’s omitted) CHARGES TO DEPOSITORS’ ACCOUNTS other than banks’ or bankers’, as reported by Clearing Houses Auguat 16, 1922 July 19, 1922 August 17, 1921 At the cloae of buaineea Aug. 16,1922 July 19, 1922 Aug. 17,1921 Altoona................... 33,249,000 33,116,000 32,872,000 4,060,000 Chester................... 4,344,000 4,796,000 8,657,000 6,700,000 Harrisburg............. 6,909,000 4,267,000 Johnstown.............. 4,807,000 4,964,000 Lancaster............... 4,632,000 5,306,000 4,173,000 Philadelphia........... 314,662,000 395,117,000 273,046,000 Reading.................. 7,922,000 7,824,000 7,150,000 Scranton................. 9,511,000 10,614,000 12,598,000 Trenton................... 11,175,000 12,099,000 9,975,000 7,991,000 Wilkes-Barre.......... 6,340,000 6,801,000 4,321,000 3,737,000 Williamsport.......... 4,029,000 Wilmington............ 8,296,000 8,062,000 6,653,000 York........................ 3,741,000 4,295.000 3,323,000 Loans and discounts: Secured by U. S. securities Secured by other stocks and bonds..................... All other........................... Investments: United States bonds.. .. U. S. Victory notes........ U. S. Treasury notes.... U. S. certificates of in debtedness.................... Other bonds, stocks and securities....................... Total loans, discounts and investments___ Demand deposits.............. Time deposits.................... Borrowings from Federal Reserve Bank................ Totals.................. 3389,617,000 3475,972,000 3346,545,000 56,814 4,572 27,791 7,350 187,971 55,340 9,419 20,148 8,835 184,998 47,197 5,675 8,245 23,350 154,126 3849,004 684,502 53,829 12,622 3836,560 686,153 51,232 12,106 3846,020 609,298 40,878 77,456 Philadelphia banks: Loans........................... 3672,385,000 Deposits...................... 670,114,000 Ratio loans to de posits ....................... 100.3% Federal Reserve Bank: Discounts and col lateral loans........... 337,066,929 Reserve ratio............... 74.0% 90-day discount rate.. 4H% Commercial paper___ 4-4H% July, 1922 Percentage Increaae or decreaee compared with Prerioua Year ago month + 1.4% + 2.6% -1 .7 % + 15.1% 97.3%• 112.6%* -2 .9 % -6 5 .7 % 77.3%* 65.7%* 4H%* 5H%* +4 H%* 6M%* Percentage increaae or decreaae cotr*pared with Previoua Year ago month Bank clearings: In Philadelphia......... 31,868,466,000 -4 .4 % + 12.2% Elsewhere in district. 114,385,500 -2 .6 % + 2.8% Total....................... 31,982,851,500 4.3% + 11.6% Building permits, Philadelphia............... 10,531,810 —20.2% + 175.4% Post Office receipts, Philadelphia............... 1,088,737 —15.0% + 2.2% Commercial failures in district (per Dun’s)......................... 29* 86 57* Latest commodity in dex numbers: Annalist (food prices only)........................ 197.233 + 1.8% + 11.8% Dun’s ........................... 173.558 - -1% + 6.0% Bradstreet’s ............... 12.0688 - -3% + 9.1% •Actual figures. Aug. 16, 1922 July 19,1922 Aug. 17, 1921 Capital paid in................... 39,181 39,003 38,656 17,945 17,945 17,564 Surplus................................ 3,867 2,081 847 Government deposits. . . . Members’ reserve account 108,117 108,555 103,337 Other deposits................... 1,256 1,351 1,320 Total deposits............ 3111,454 3113,773 3105,504 Federal Reserve notes.... 179,274 178,133 216,543 Federal Reserve Bank notes................................ 5,138 3,958 7,320 Deferred availability items 42,962 42,808 43,762 All other liabilities............ 1,486 1,281 3,949 Total liabilities.......... 3366,260 3368,081 3403,298 369,193 174,170 364,064 Auguat 21, 1922 Aug. 16, 1922 July 19,1922 Aug. 17, 1921 Gold reserves..................... 3205,060 3216,462 3204,829 10,999 8,404 Other cash.......................... 3,010 Total reserves.......... 3216,059 3224,866 3207,839 Discounts—secured by U. 27,602 S. securities.................... 30,021 85,949 8,284 Discounts—all other........ 8,128 29,371 21,013 Purchased bills................... 30,132 1,887 34,491 U. S. securities................... 33,673 27,377 Total earning assets.. 399,691 393,653 3144,584 49,016 47,720 Uncollected items............. 49,263 1,494 1,842 All other resources............ 1,612 Total resources.......... 3366,260 3368,081 3403,298 LIABILITIES 315,401 230,004 312,415 BUSINESS INDICATORS STATEMENT Federal Reserve Bank of Philadelphia (000’s omitted) RESOURCES 315,430 236,533 312,543 32
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