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MONTHLY FEBRUARY 1948 CONTENTS Food Prospects for 1948 . . v i e . . 4 . . 9 National Business Conditions . . District Statistical Tables . 10 & 11 . . Announcem ents.................... e 1 . The Nonferrous Castings Industry K . . , 12 w F I N A N C E • I N D U S T R Y • A G R I C U L T U R E •T R A D E FOURTH Vol. 30— No. 2 FEDERAL RESERVE DISTRICT Federal Reserve Bank of Cleveland Cleveland 1, Ohio Food Prospects for 1948 T HE sustained high level of agricultural produc tion during the past several years represents one of the most propitious developments in American eco nomic and social history. It is difficult to visualize the extent to which that series of good crop years mitigated the problems of price control, rationing, wage control, and foreign relief. Food might have been much scarcer, and a much more critical item, if Nature had been adverse instead of relatively favorable. In considerable measure bumper crops are attrib utable to favorable weather conditions. The extent to which unfavorable weather conditions have reduced agricultural output in the past is clearly illustrated on an accompanying chart. The drouths of almost nationwide proportions which occurred in 1933-36 reduced food production substantially, and to a de gree which would be infinitely more devastating if GROSS FARM PRODUCTION United States PERC EN T PERCENT . . . . a recurrence of unfavorable weather conditions, as in 1933-36, would reduce agricultural output from recent highforlevels. Digitized FRASER http://fraser.stlouisfed.org/ Source: United States Department of Agriculture. Federal Reserve Bank of St. Louis the situation were to repeat itself under conditions of the present record demand for foodstuffs. There is every indication that the need and demand for food will remain extraordinarily strong for some time to come. It is also recognized that expenditures for food represent a major item in total consumer expenditures. The postwar increase in the cost of food undoubtedly has been a major factor in the persistent pressure for higher wages, which in turn were reflected in higher costs and in higher prices for finished goods. In fact, the supply and demand situation in foodstuffs is one of the focal points in the general problem of inflation, and the question of whether food will continue to flow in record amounts from American farms throughout 1948 is a matter of wide public concern. Fortunately, the prodigious output of recent years is not solely ascribable to meteorological conditions. Several factors wholly subject to human control, have contributed to the unprecedented volume of production of food stuffs. More widespread use of improved varieties of seed and plant has resulted in higher yields. Soil and water conservation practices have produced addi tional units per acre. The constantly expanding mechanization of agriculture has permitted greater timeliness in planting and harvesting operations. For example, last season’s corn planting was accom plished in about one-half the former number of days with around-the-clock operations made possible by use of mechanical power. Finally, and perhaps most important, have been the substantial increases in lime and commercial ferti lizer applications. During the past decade fertilizer usage has practically doubled and lime applications have increased by four times. W ith slight modifica tions, all of these factors should be equally effective Human Factors Page 2 Monthly Business Review this year and should yield correspondingly satisfactory results. Supplies of commercial fertilizer and farm machinery are expected to be somewhat larger than last year. Lime and facilities for applying it to the soil also should be more readily available. In short, barring a repetition of a lack of precipi tation such as occurred in 1933-36 or some similar nationwide deviation in weather, it seems probable that aggregate farm output may be expected to approximate, if not exceed, the annual average of the past five years. Although 1948 food production in the aggregate may equal that of recent years, given reasonably fav orable weather, the supply of several individual groups of food may vary substantially from the average. The following tabulation shows 1947 results by major com modity groups as a percentage of the recent five-year experience. Variations Among Foods 1947 PRODUCTION AS A PERCENTAGE OF THE 1943-47 AVERAGE 1943-47 = 100% Food Grains................................................ 126% Sugar Crops................................................ 116 Fruit and Tree Nuts...................................106 Dairy Products............................................103 Truck Crops................................................102 Oil Bearing Crops.......................................102 Poultry and Eggs........................................ 99 Meat Animals............................................. 98 Potatoes and Other Vegetables................. 90 Feed Crops.................................................. 74 The outstanding fact in the foregoing table is the 26 percent margin in food grains over what would once have been considered extraordinary accomplish ment. Most of this increase is attributable to the huge wheat crop of last year. INCREASES IN USE OF LIME, FERTILIZER AND TRACTORS P ER C EN T PERCENT 600 ---------- 1600 500 ^ f e r t il iz e r . . . . the use of more lime, fertilizer, and tractors should moderate the destructive potential of adverse weather. * Source: Tractors and Lime—U. S. Department of Agriculture. Fertilizer —National Fertilizer Review. February 1, 1948 The trend in harvested acreage of wheat has been upward in recent years. This is likewise true of yield per acre. The area of winter wheat now in the ground is at a new high of 58.6 million acres despite unfavor able moisture supply in several of the major growing areas at seeding time. Many of those areas have since received precipitation to the extent that crop condi tions are reported to have improved after the issuance of the December 1 crop report. Indicated production at that time was 839 million bushels. This compares with a preliminary estimate a year ago of 947 million bushels, whereas the final outturn was 1,067 million bushels. Even though the winter wheat crop should prove no better than the present estimate, if spring wheat attains an average (1936-45) crop of 236 mil lion bushels, another billion bushel wheat harvest will be assured. Annual spring wheat production during the past five years has averaged nearly 300 million bushels. O f the minor food grains, rice is the only one in which the harvested acreage has shown a pronounced upward trend. Acreage of that crop has been steadily increasing and reached an all-time high in 1947. Yield per acre has remained about average. Although the harvested acreage of rye shows little prospect of increasing, the acreage of buckwheat was increased markedly this past year. Much of this in crease can be attributed to the use of buckwheat as a substitute crop made necessary by the delayed spring planting season. If aggregate volume of food grain production is to exceed the recent five-year average it will be necessary that the billion bushel wheat crop now in prospect be supplemented by an outturn of these minor food grains at least equal to that of the preceding season. At the other extreme in the 1947 array is the output of feed crops upon which the production of livestock and livestock products depends. A reduction of nearly 10 million acres of these crops occurred during 1947 principally as a result of unfavorable conditions at planting time. If farmers are inclined, however, to increase acreage by about that same amount during the current year in order to replenish feed supplies, the outturn of feed crops should approximate the average of the past five-year period. One of the factors that may prove troublesome in restoring feed crop production is the lack of sufficient supplies of early maturing hybrid seed-corn stocks. Larger than normal quantities of this sort were planted a year ago. As a result carry-over stocks are insufficient to offset the smaller harvest of such hy brids this past season. Hybrid seed-corn producers are of the opinion that there will be sufficient seed to plant the usual acreage. It may not be possible, however, for com producers to get the particular hybrid selection or grade to which they have become accustomed. Feed Crops February 1, 1948 Page 3 Monthly Business Review Seed oats, too, may present more of a problem than now seems apparent. Both yield and quality of the crop was poor in many areas. Producers in those areas are confronted with purchasing seed or sowing oats of inferior quality. Another potential hazard is the fact that farmers have come to depend so largely on mechanical power to perform field work which raises the problem of tractor-fuel supplies during the peak of the spring planting season. Uninterrupted field operations neces sitate not only adequate supplies but transportation and storage facilities which permit a constant supply of tractor fuel during the peak consumption months of spring and early summer. A few areas experienced some difficulty last year and recent reports indicate that if fuel oil consumption remains extremely heavy during February, petroleum refinery schedules might be delayed to the extent that tractor fuel supplies would be unfavorably affected next summer. Indicated production of truck crops for fresh market the first three months of 1948 is reported to be about 8 percent above a year ago, and 26 percent above average. It is sig nificant that truck crops have led all others in increased rate of fertilizer application. From 1942 to 1946 the average rate of application per acre on truck crops increased by 54 percent. It seems probable that truck crop production in the 1948 season will approxi mate the high level of this past year. Because of mul tiple cropping and irrigation truck crops are less susceptible to the vagaries of weather. Truck Crops three of the past five years, the potato crop has exceeded 400 million bushels despite the fact that harvested acreage has steadily declined. Even though acreage harvested this past year was about one-fourth less than average, bushels harvested were several million in excess of an average crop. The steady decline in potato acreage in recent years has been offset by a compensating increase in yield per acre. Although better pest control with improved in secticides has tended to enlarge yields, a 49 percent increase in rate of fertilizer application per acre has also contributed substantially to higher yields. A record supply of certified seed potatoes is available and the more liberal application of commercial fertilizer may stimulate some increase in the potaio crop. Potatoes and Other Vegetables There is a good possibility that the fruit crop this year will exceed that of the past year and of the five year average. The bearing habit of some important fruit trees tends to cause total volume of fruit crops to be somewhat above average in alternate years. Furthermore, the yield forper acre of most fruit crops has been in an Digitized FRASER upward trend for a number of years. http://fraser.stlouisfed.org/ ^he amount of acreage devoted soybeans, peanuts, and flax seed, the principal oil-bearing crops, has held at relatively high levels throughout the postwar period. The urgent demand for fats and oils has maintained a per unit price for these crops which has caused them to be relatively more profitable than other competing crops, and it seems probable that the acreage planted this year will be of such proportions as to provide an output equal to, or in excess of, this past year. Oil-Bearing and Suaar C t o d s ' W ith respect to sugar crops, the yield-per-acre of sugar beets reached a new record high last year. It is significant that the rate of fertilizer application per acre on sugar beets has increased by two and one-half times in the past six years. Present trends in acreage and yields indicate that sugar crop production may approximate 1947 output. In contrast to the relatively favorable outlook for food crops, given reason ably satisfactory weather, the produc tion of livestock and livestock products is in a declining trend. Meat Production The number of cattle on farms on January 1, 1948, was probably lower than in any year since 1942. Sheep are not far from the all-time low of 37 million established in 1923, and the number of hogs on farms is close to the 1941 figure of 54 million head. The number of beef cattle on feed at the beginning of the year was 12 percent smaller than a year ago and the lowest since 1940. In the twelve North Central States where over three-fourths of the cattle feeding operations take place, the number of cattle on feed was nearly one-fifth smaller than a year earlier. (Please turn to page 8) HARVESTED ACREAGE OF MAJOR FEED AND FOOD GRAIN CROPS M ILLIO N S o r ACRES M IL L I O N S OF A C R ES Fruit Crops Federal Reserve Bank of St. Louis ........ the upper curve, which determines the long-run supply of meat, has been declining for several years, while the acreage of human food crops has been expanding. Source: United States Department of Agriculture. Page 4 Monthly Business Review February 1, 1948 The Nonferrous Castings Industry HE nonferrous castings industry has weathered two rough spots in the postwar period to date and may possibly encounter a third before the end of 1949. The first of these was the 1945 reconversion period with a severe drop in the level of production. The second occurred in 1947 when customers, fear ful of the “inventory problem”, cancelled orders on a large scale. Nonferrous foundries are currently operating below full capacity, but above prewar levels. The trend of recent months has been upward and 1948 may well be a bigger year than either 1946 or 1947. T SHIPMENTS OF NONFERROUS CASTINGS 1946 for the continuation of a fairly adequate supply, barring prolonged strikes. Apparently there will be no shortage of brass and bronze ingots this year. The industry is flexible enough with the help of imports, to meet any anticipated demand. The supply of zinc likewise is expected nearly to match demand, but prices, supported by the con tinuing Government stockpiling program, have already edged upward. Although a record peacetime production of alumi num last year failed toward the end of the period to match demand, foundries have reported no diffi culty in obtaining pig aluminum for casting. Potential magnesium productive capacity far exceeds current needs and no shortage in this metal is anticipated. W ith respect to lead, the combination of domestic mine production, scrap recovery, and imports is expected to satisfy foundry demand during 1948. O f the nation’s 2,500 nonferrous foundries, 522, or 21 percent, are in Fourth District states. Ohio is the leading state in the country with 250 establishments, and Pennsylvania is in fourth position. (See appended table.) Another gauge of the industry’s geographical con centration is the volume of business done, and in this respect also, foundries in the Fourth District outstrip any other region in the country. Shipments from plants in Fourth District states in 1946 amounted to one-third the national total of 1.9 billion pounds. Among all the states, Ohio production was largest; Illinois, second; and Pennsylvania, third. Concentration in Fourth District . . . . production of nonferrous castings is concentrated in the Fourth District. Source: Bureau of the Census. Nonferrous foundries have benefited from the fact that their ferrous cousins, the steel and iron foun dries, have been unable to meet their customers’ demands because of the well-publicized shortage of basic raw materials. This circumstance has led to a limited substitution of nonferrous castings. When this production prop ultimately is partially removed and stronger competition returns, the nonferrous foun ders will face their third, and possibly most impor tant, postwar test. One of the features of the war and postwar period was the rise in importance of die casting and perma nent molds, and the consequent advance in produc tivity. Die casting foundries in many instances are operating at a higher rate now than during the war. Mechanization and “conveyorizing” are becoming more prominent in a traditionally hand-operated foundry industry. Technological advances in alloy ing, heat treating, casting, etc., have been apparent. Nonferrous foundries had relatively little trouble obtaining metal for casting last year, and the outlook, with the exception of tin, in the current period is http://fraser.stlouisfed.org/ Raw Metal Supplies Federal Reserve Bank of St. Louis SHIPMENTS OF NONFERROUS CASTINGS Distribution by kind of metal 1947 . . . . although copper, brass, and bronze castings constitute the largest single category in terms of weight, aluminum castings rank first in unit volume. Source: Bureau of the Census. February 1, 1948 Monthly Business Review The principal reason for the dominance of the lake states in this industry is the fact that the largest con sumers of castings— transportation, industrial and farm machinery manufacturers— are also located here. Other influential factors are availability of labor, industrial power and fuel (especially natural gas), and transportation facilities. COPPER A N D COPPER-BASE ALLO Y C A S T IN G S The Fourth District states of Pennsylvania and Ohio rank first in the nation in shipments of copper and copper-base alloy castings, accounting for about one-third the total. Principal customers are producers of transportation equipment, and to a smaller extent, manufacturers of plumbing supplies, electrical and industrial machinery manufacturers, and others. W ar needs boosted annual shipments of copper, brass, and bronze castings to an all-time peak of 1.5 billion pounds in 1943. O f estimated total shipments in 1947 of 1.1 billion pounds, 90 percent were sand castings, 5 percent were permanent mold, with the remainder accounted for by die castings and other types. These copper-base castings amount currently to over half the shipments (by weight) of all nonferrous castings. Shipments of brass and bronze castings dropped from a monthly total of nearly 150 million pounds in March 1944 to the postwar low of 56 million in December 1945, a decline of 62 percent, caused by termination of war contracts and later by strikes among major suppliers. By October 1947, shipments had increased again to 92 million pounds, nearly 30 percent below the record 1943 monthly average of 127 million pounds. O f the 2,000 foundries devoted wholly or partly to production of copper, brass, and bronze castings, jobbing foundries outnumber the captive foundries two to one, but their production was about equal. Production of captive producers logically has the edge in die and permanent mold castings, while jobbing foundries ship slightly more sand castings. The size of these foundries varies con siderably, a fact which is characteristic of the whole industry. In 1946, 3 percent of the foundries accounted for 43 percent of the shipments of nonferrous castings. In this region the number of persons employed in copper-base alloy foundries ranges from a minimum of 10-12 in one foundry to as many as 1,000 in the largest operation. Importance of Jobbing Foundries There appears to be general agreement among managers of brass and bronze foundries that a recovery from for the 1947 midsummer slump is well underway, Digitized FRASER and that prospects for at least the first few months http://fraser.stlouisfed.org/ The Current Situation Federal Reserve Bank of St. Louis Page 5 of 1948 are for better volume than in the average month last year. Competition of the vigorous prewar type entered the scene shortly after the end of the war. As the backlog of unfilled orders decreased almost 20 per cent from September 1946 to August 1947, bids for new orders became progressively sharper. Some foundries were operating at below one-shift capacity and could afford to take new business almost at cost in order to increase efficiency and productivity and thereby eventually reduce average unit costs. In October, latest month for which industry figures are available, unfilled orders were equal to somewhat over six week’s production, although this factor varied widely among companies. Before the war many foundries in this area were devoted more or less exclusively to brass and bronze art and architectural castings of the short-run, infre quently reordered type. During the period of han dling war sub-contracts for industrial castings, these small plants were able in many cases to enlarge their facilities, with the result that their art work is now , largely a sideline. Foundries producing copper-alloy castings have benefited from the comparative shortness of iron and steel needed for ferrous castings, although not to the same extent as have foundries casting other nonferrous metals. Movements in the prices of castings are tied fairly closely to metal prices. This component often amounts to 50 percent or more of the selling price. Copper, tin, zinc, and lead are the principal metal components of brass and bronze (copper-base alloy) castings. Over the past eight years, December 1939 to December 1947, the price of casting copper has risen 77 percent, from 12 cents per pound to 21% Labor and Material Costs PRICE PER POUND OF NONFERROUS METALS Annual Averages, 1938-1947 oi------------ 1------------ 1_____I____ I 1 938 1939 19 4 0 1941 1942 i 1 943 i i 1 94 4 1945 1 946 t 1947 i 7948 i n 1 94 9 -----except for tin, the spread of prices of foundry metals has nanowed since 1938, and is confined within an area not far above prewar levels. *Price recently established by RFC. February 1, 1948 Monthly Business Review Page 6 cents. Tin costs have advanced even further, from 51 cents to 94 cents, or 84 percent. Zinc costs went to 11 cents from 6 cents, a rise of 83 percent, and lead almost tripled in price, moving from 5 / 2 cents to 15 cents. Labor costs, while somewhat slower moving, have increased as much as metal prices and have helped establish a high breakeven point in volume. While these various metals have changed radically in price, they are generally in fair supply, and foundry oper ations have rarely been curtailed for lack of raw materials. The supply of labor, both skilled and un skilled, has occasionally been short, and turnover of unskilled employees has been rapid and expensive at many plants. A LU M IN U M C A S T IN G S The 1,640 foundries producing aluminum castings comprise the second largest segment of the nonferrous castings industry. Aluminum castings become, or are components of, cooking utensils, appliances, industrial chemical equipment, bearings, and machinery equipment. Automotive and aircraft manufacturers especially are big users. Commercial castings produced in jobbing foundries account for about 75 percent of total ship ments and the other 25 percent of castings are made in captive foundries. Shipments reached an all-time monthly peak of 50 million pounds in March 1945. The record year, however, was 1944 when a total of 514 million pounds were shipped. Subsequent annual totals were 395 million pounds in 1945 and 389 million pounds ANNUAL SHIPMENTS OF ALUMINUM CASTINGS AND PERCENTAGE BY TYPES* U. S. A . - 1942-1947 M ILLIO N S OF P O U N D S 600( M IL L IO N S OF P O U N D S 1600 S00- 400- . . . . in aluminum foundries, permanent mold and die casting processes have gained importance at the expense of sand casting. * The “all other” classification never accounts for more than one percent. based on first 10 months. ♦♦Estimated— Source: Bureau of the Census. http://fraser.stlouisfed.org/ Federal Reserve Bank of St. Louis in 1946. The estimated total for 1947 is 440 million poynds, or about 90 percent of the record annual average reached during 1943-44. O n the other hand, the 1947 output of brass and bronze castings prob ably will not exceed 70 percent of the highest wartime rate. The displacement of iron and steel castings by aluminum cast ings, begun years ago, is becom ing more significant. Quantitative data on this move ment and its trend are unobtainable, but in the opinion of many local foundrymen, the switchover is likely to gain momentum in 1948. The inability of manufacturers to obtain sufficient amounts of gray iron and steel castings has been the main factor in this diversion. Advances in alloying, improvements in strength and usability, plus the original advantage of light weight have also contributed to a relatively greater use of aluminum. The prospects are that substitutions will become more or less permanent in such products as pistons, many kinds of wheels, piano plates, engine heads, architectural items such as span drels, and many dead weight items in automobiles and trucks. Displacement of Iron and Steel Permanent mold castings and die castings have increased in impor tance at the expense of sand cast ings. Measured as a percentage of shipments, permanent mold castings have in the six years 194247 increased from 18.5 percent to 40 percent, die castings from 17 percent to 24 percent, while sand castings declined from 64 percent to 36 percent. (See appended table.) Decline of Sand Castings Shipments of sand castings have been declining since March 1945 when the wartime peak was estab lished, and current operations are but one-third that record level. Permanent mold and die castings, on the other hand, reached an all-time high in the spring of 1947 and subsequent monthly production has at no time dipped more than 35 percent below that top. The backlog of unfilled orders for aluminum castings varies widely as to the type of casting and from foundry to foundry. The backlog of orders for die castings is the largest of the three types and is equivalent to about four months’ production, while die casting production, though increasing, is still the smallest of the three types. The backlog has been reduced for all three methods by about 40 percent over the past year. Unfilled Orders Z IN C C A S T IN G S In both the number of foundries engaged and in volume of shipments, zinc castings rank third in the nonferrous castings industry. February 1, 1948 Page 7 Monthly Business Review In 1946 there were 373 foundries making zinc castings, compared with 1640 aluminum foundries. Despite this difference in the number of producing units, tonnage output of zinc castings closely approxi mates that of aluminum, a circumstance accounted for partly by the fact that zinc is 2l/ z times heavier than aluminum, and partly because the faster diecasting method predominates in zinc foundries. In the average month last year, 36.3 million pounds of zinc castings and 36.8 million pounds of aluminum castings were shipped. One out of every five pounds of zinc castings shipped in 1946 came from foundries in Ohio, the leading state. These were in the form of hardware items, instrument cases, automotive parts, decorative objects, components of home appliances, and similar products. Practically all zinc castings are die castings and over 70 percent of the castings are produced for sale, with the remainder being used by the pro ducer or its parent company. Zinc-base alloys account for the largest percentage of total nonferrous die castings, are relatively easy to cast and have high ductility and impact strength. Predominance of Die Casting Local zinc foundry operators believe the use of zinc die castings will increase as the versatility and comparative cost of this metal and its method of casting become more widely known. Outlook for Expanded Markets Production in 1947 was almost 15 percent ahead of the previous year. Unfilled orders amount to three months’ production, but this ratio varies con siderably from plant to plant. Productivity shows signs of increasing and has advanced above the 1940 level. Die casters of zinc and aluminum anticipate a growing share of the market for castings because the die casting process lends itself particularly well to mass production. W ith advances in techniques, cast ings are expected to become almost indistinguishable from pieces machined from bar stock. Competition has been increasing, however, particu larly during the summer slump of 1947. This has forced a closer watch over estimating procedures, scrap losses, metal prices, inventory problems and the other usual concomitants of the return of a buyers’ market. aluminum, apparently have begun to overcome aluminum’s disadvantages of slower handling, higher pressure requirements, and higher melting point. Two years ago, shipments of zinc die castings were almost six times those of aluminum (by w eight); by Janu ary 1947 the ratio was less than five to one, and during the past year the proportion dwindled to three and a half to one. M A G N E SIU M C A S T IN G S Magnesium castings, one-third lighter than alumi num, were used extensively in aircraft and munitions during the war, and in the peak year of 1944' ship ments amounted to over 200 million pounds. After V-J day, with the cancellation of war contracts, output virtually came to a standstill within three months. Thereafter, production gradually rose to a level of 600-800 thousand pounds per month, still only about 5 percent of the wartime peak. The foun dries or foundry departments that survived this vigorous shakeout have now recovered perhaps 30-50 percent of their wartime volume. The use of sand molds currently predominates in magnesium castings, accounting for 75-90 percent of ship ments, while permanent mold and die casting repre sent about 6-10 percent and 4-15 percent, respectively. During the war, however, the permanent mold method was widely employed and accounted for as much as 60 percent of production, representing largely the output of incendiary bombs. Production Methods Ohio, with ten magnesium foundries, ranks third in the nation, and in shipments, according to recent data, is second only to Michigan. These two states INDEXES OF SHIPMENTS OF COPPER CASTINGS* ALUMINUM CASTINGS, and MAGNESIUM CASTINGS 1942 - 1 9 4 7 Average month 1943 -1944 = 100% PERCENT PERC EN T 6 •• • % o i---------------------• • S'---------------------- .1_____ A L U M IN U M CASTINGS 0 - ------------ A . 5 ------------ -J — 0 J . a i : \ C OPPER “ C ASTINGS * — ------------ s As a die casting metal, aluminum is highly competitive with zinc and the production of aluminum die castings is increasing. The rising trend zinc prices in contrast to declines in alumi Digitized for of FRASER http://fraser.stlouisfed.org/ num prices, plus the lightness and greater strength of Competition from Aluminum Federal Reserve Bank of St. Louis M AGNESIUM C ASTING S 0 -------— — — . . . . current production of aluminum castings is closer to the level of wartime peak operations than is the output of brass and bronze castings. *Copper, brass, and bronze castings. Page 8 Monthly Business Review account for almost 40 percent of magnesium castings. Over 90 percent of total production is commercial castings, and the current backlog of orders amounts to about five months’ production. Despite the impressive drop in demand for magnesium cast ings at the war’s end, produc ers in this area are moderately hopeful about the future. They believe long strides could be made in basic research, but most magnesium foundries are too small to finance such a program. The metal’s funda mental advantage, of course, is its lightness. Another selling point is the fact that these castings can be machined easily to a mirror finish. Magnesium is obtainable in quantities far exceeding the present demand, -and the price of the metal is 20.5 cents per pound, which is lower than copper and tin and not much higher than aluminum, lead, and zinc. There is a fire hazard in handling molten mag nesium and in the machining of castings, but ade quate safeguards have been developed and incorpo rated in the regular production routine. Considerable “know-how” is required in casting magnesium. The metal loss in sand casting magCurrent Problems and Outlook FOOD PROSPECTS FOR 1948 (Continued from page 3) An even greater reduction occurred in the number of sheep and lambs being fed for market. Most of this decrease in feeding operations has been confined to the Com Belt States. Sharply reduced feed supplies, and distinctly un favorable livestock-feed-price ratios during the past seven months, are responsible for marked reductions in livestock on feed, and a smaller spring pig crop. The contraction in meat animals and breeding stock which is currently going on, means significantly lower meat animal production than occurred this past year. Meat supplies per capita are expected to be off about 8 percent. The reduction in all classes of meat ani mals has been such that even though feed crops this year should be noticeably better than the previous year, no material increase in meat is in prospect before late next year. Like beef cattle, the number of milk cows has also declined, but it is anticipated that output of dairy products will remain near that of the past year. Production per cow established a record rate in December and pros pects are that a near record will be maintained in 1948 excluding the advent of an extremely unfavor able pasture season. A sufficiently large increase in number of heifer calves has occurred to offset the downward trend in cow numbers. While the prospect attaining an output of dairy products approxi Digitized of for FRASER http://fraser.stlouisfed.org/ mating last year’s volume appears relatively favorDairy Products Federal Reserve Bank of St. Louis February 1, 1948 nesium is about 25 percent compared with but 10 percent for aluminum. Because of shrinkage, more gates and risers must be used than with other metals, with the result that 3/2 times more metal may some times be poured than is represented by the final casting itself. This metal also requires special sand practice to help restrict moisture content in the mold in order to prevent ignition of the molten metal. Some steps have been taken to produce more con sumer items from this light metal, with moderate success. Number of Nonferrous Foundries by K ind of Metal, in the Six Leading States, 1946 Copper and Aluminum Copper-base Castings Total * Alloy Castings O hio................... California......... New York........ Pennsylvania. . M ichigan......... 250 238 234 232 228 203 196 157 195 217 143 149 185 172 164 137 143 117 Zinc Castings Magnesium Casting 36 51 34 23 64 50 10 14 9 2 5 12 * Some foundries process more than one metal, and are included under more than on heading. Source: Bureau of the Census (Please turn to page 12) able at this time, butter production will show little or no increase so long as consumer demand for other dairy products remain at current levels. It is anticipated that egg production during the first half' year may not be greatly different from the preceding similar period. Rate of lay, now nearly 14 percent above average, is expected to remain high. The num ber of layers, however, is slightly below a year ago and the prospect that new replacements will not maintain flock numbers indicate a decline in egg pro duction after mid-year. The egg-feed price ratio which has been unfavorable most of the past year is expected to continue unfavorable during the cur rent hatching season. A year-to-year decline in the egg-feed price ratio usually results in fewer chickens raised for flock replacement. Thus it appears likely that both egg and chicken meat output will be lowef than in the preceding year. Turkey producers react similarly to adverse changes in the feed price ratio. For that reason there is limited prospect that turkeys grown for market will be in excess of a year earlier even though growers received slightly higher prices during the past marketing season. Total livestock production seems certain to fall below the relatively high volume of the year recently ended. Substantial increases in food grain require ments in recent years make it appear unlikely that output of livestock products will recover this loss until the heavy demand for food grain abates. Poultry and Eggs February 1, 1948 Page 9 Monthly Business Review SUMMARY OF NATIONAL BUSINESS CONDITIONS By the Board of Governors of the Federal Reserve System (Released for Publication January 28, 1 9 4 8 ) Industrial production was maintained at record postwar levels in December. Department store sales continued in large volume in December and the early part of January. The general price level advanced further while prices of speculative commodities de clined somewhat. Industrial production The Board’s seasonally adjusted index of indus trial production was 191 per cent of the 1935-39 average in December as compared, with 192 in in November and 190 in October. Activity in durable goods industries continued to advance in December and was at a new postwar peak rate. Iron and steel production advanced to the highest rate of the year, after allowance for mill closings on Christmas Day, and continued to increase in January. Assembly of passenger automobiles ad vanced further in December from the high November rate, and production for the year was about 3.6 m il lion units as compared with 2.2 million in 1946 and 3.8 in 1941. O utput of trucks in 1947 was the high est on record. Production of freight cars in December reached a total of 9,800 units, which virtually met the goal established for the industry last spring. Output of nondurable goods showed a slight de cline in December largely because holiday influences reduced production in a few lines such as cotton textiles and paperboard. O utput of manufactured foods also declined somewhat, after allowances for seasonal changes, owing mainly to a reduction from the high November rate of livestock slaughter. Petro leum refining activity increased in December and early January. Despite a substantial gain in output of fuel oil, supplies were short of exceptionally heavy demands. Minerals production in December was maintained at the level of the preceding month. Coal output was not as large as in November, while crude oil pro duction showed a further gain. Employment Nonagricultural employment showed the usual large seasonal increase from mid-November to midDecember, reflecting the pre-Christmas expansion in trade. The number of persons unemployed in early December remained at the low November level of 1.6 million, about half a million less than a year ago. Construction Value of construction contracts awarded, as re ported by the F. W . Dodge Corporation, declined more than seasonally in December, reflecting chiefly decreases of about one-fifth in awards for residential building and public works. As compared with December 1946, however, values of awards for most types of construction were substantially larger. Distribution Department store sales in December showed the Digitized FRASER usual forsharp increase and the Board’s seasonally adjusted index remained at the advanced November level. Total sales in the fourth-quarter holiday shop ping season were 9 per cent larger than in the same period in 1946. Sales in the first half of January showed somewhat more than the usual seasonal decline. Loadings of railroad freight in December and the early part of January continued at an exceptionally high rate for this season of the year, owing mainly to the sustained large volume of shipments of manufac tured goods. Loadings of grain and livestock were con siderably below the high levels prevailing a year ago. Commodity prices The general level of wholesale commodity prices continued to advance from the middle of December to the latter part of January, reflecting chiefly further increases in prices of petroleum and metal products. Prices of commodities traded in the organ ized markets generally declined somewhat from the advanced levels reached during the autumn. The consumers’ price index advanced further by about one per cent in December, reflecting chiefly increases in retail prices of foods and fuels. Bank credit Purchases by the Federal Reserve System in sup port of prices of Government bonds continued in December and the first three weeks of January. Pur chases were particularly large after December 24 when the Federal Open Market Committee reduced the prices at which bonds would be purchased for System account. Total holdings of Government securities at Reserve Banks declined 700 million d o llars, however, reflecting substantial market sales and redemption of bills and certificates. The post-Christmas return of currency from circu lation was offset in its effect on bank reserves by an excess of Treasury receipts from taxes and calls on war loan accounts over current expenditures. Total holdings of Government securities by mem ber banks in leading cities showed little further change during December and the first half of Jan uary. These banks sold bonds but increased their holdings of bills. Business loans continued to increase sharply during most of December and, following a small post-Christmas decline, showed further growth in the first half of January. Real estate and consumer loans also expanded further. Interest rates and bond yields Accompanying reduction in Federal Reserve sup port prices for bonds, yields on Treasury bonds, in creased by as much as one-fourth of a point on some issues. Yields on corporate bonds also rose somewhat. Short-term money rates advanced slightly in Decem ber and January. In January the Federal Reserve Banks increased their discount rates from 1 per cent to 1*4 per cent. Page 10 Monthly Business Review February 1, 1948 DEPARTMENT STORE TRADE STATISTICS Sales by Departments— December, 1947 As compared w ith a year ago (Compiled January 27, and released for publication January 29) Hosiery (Women’s and Children’s).................................................................. ...+46 Coats and Suits (Women’s and Misses’) ......................................................... ... + 3 3 Domestic Floor Coverings................................................................................ ...+33 Sportgoods (Including Cameras)...................................................................... ...+29 Neckwear and Scarfs......................................................................................... ...+27 Toys and Games................................................................................................ ...+23 Lamps and Shades............................................................................................. .. +23 Housewares............................................................................................................+21 Luggage............................................................................................................... ...+21 Notions............................................................................................................... ...+20 Men’s Clothing................................................................................................... ...+20 Blouses, Skirts and K nit Goods.......................................................................... +19 Corsets and Brassieres....................................................................................... .. +16 Furs...................................................................................................................... +15 Major Household Appliances............................................................................. +14 Infants’ Wear......................................................................................................... +14 Draperies and Curtains...................................................................................... +14 M A IN S T O R E T O T A L ................................................................................... .. +13 Women’s Underwear.......................................................................................... .. +13 Juniors’ and Girls’ W ear.................................................................................... ...+11 Dresses (Women's and Misses’) ........................................................................ .. +11 Furniture and Beds............................................................................................ ...+10 Shoes (Women’s and Children’s)...................................................................... .. + 9 Aprons and Housedresses..................................................................................... + 9 Boys’ Clothing and Furnishings.......................................................................... + 8 China and Glassware......................................................................................... Leather Goods (Sm all)...................................................................................... Books and Stationery........................................................................................ Restaurants......................................................................................................... Silverware and Jewelry...................................................................................... Men’s Furnishings (Hats and Caps)................................................................. + + + + + + 8 8 8 8 7 7 Men’s and Boys’ Shoes...................................................................................... ... + 6 Photographic Studio.......................................................................................... ... + 6 Art Needlework and A rt Goods....................................................................... ... + 6 Silks and Velvets (Woolen Dress Goods)........................................................ ...+ 5 Beauty Salon...........................................................................................................+ 3 Domestics and Blankets.......................................................................................+ 3 Handkerchiefs..................................................................................................... + 1 Laces and Trimmings........................................................................................ —0— M illinery............................................................................................................. — 1 Gloves.................................................................................................................. — 3 Toilet Articles and Drug Sundries.................................................................... — 4 Cotton Wash Goods........................................................................................... — 5 During December, which was a record month for dollar sales in Fourth District department stores, 37 out of 42 individual departments reported gains over a year ago. Basement store sales were up 19% over December 1946, while main store sales showed a 13% margin. Women’s and children’s hosiery w ith an increase of 46%, led all other departments in year-to-year gain in December sales. Women’s and misses’ coats and suits were up 33% in sales, and neckwear and scarfs advanced 27%, setting a new all-time high for th a t department. Sales of furs, up 15% over December 1946, were at a five-year high for the month. The women’s underwear department, after two months of sales below 1946 levels, reported a 13% increase over a year ago. Other departments in the women’s apparel and accessories group showed per centage changes ranging from a 19% increase to a 3% decrease. The year-to-year declines in December sales of the millinery and gloves departments completed a year of total sales at levels lower than those of 1946. Among the house furnishings departments, major household appliances, with a gain of 14% over December 1946, lost relative position. Greater advances were registered by domestic floor coverings, up 33%, lamps and shades, up 23%, and housewares, up 21%. Sustained strength of sales in domestic floor coverings is Indexes of Department Store Sales and Stocks Daily Average for 1935-1939=100 Adjusted for Seasonal Variation* Dec. Nov. Dec. 1947 1947 1946 W ithout Seasonal Adjustment Dec. Nov. Dec1947 1947 1946 S A L E S’ Akron (6)....................... Canton (5)...................... Cincinnati (8)................. Cleveland (10)............... 316 340 297 282 327 367 331 306 290 310 268 255 499 592 502 446 385 447 417 349 458 539 453 403 Columbus (5)................. Erie (3).......................... Pittsburgh (8)............... Springfield (3)............... 316 321 274 290 371 325 272 326 303 273 247 257 556 565 439 517 445 390 324 369 533 480 395 457 Toledo (6)...................... s Wheeling (6)................... Youngstown (3)............. District (96)................... 287 241 322 309 304 269 343 296 255 219 284 277 488 456 522 479 362 318 412 371 434 414 460 430 272 268 258 225 283 214 STOCKS* D istrict.......................... Digitized for* FRASER Seasonal factors for district revised as of July of 11 cities revised as of October 1944. 1946; seasonal factors for each shown by the fact th a t 1947 sales exceeded those of 1946 during every month of the year, and by a margin of more than 20% during nine of those months. Each of the four departments in the men’s and boys’ wear group recorded sales increases over last year. Men’s clothing, with a 20% margin, had the largest gain. Men’s furnishings, up 7%, showed the first year-to-year gain of the past seven months. Sport goods and cameras, w ith a 29% increase over December 1946, rounded out a year in which sales bettered those of 1946 during all twelve months. Toys and games sales participated in the final Christmas rush. Although sales by this de partment lagged throughout most of 1947, as compared w ith the preceding year, the December sales spurt carried toy sales to a new all-time high, 23% above a year ago. Toilet articles and drug sundries, however, slipped 4% from December 1946 to a three-year low for the month. Although December sales of th a t department were more than twice as high as November sales, the 1947 total was under that of 1946. A ll comparisons herein refer to dollar volume of sales. Changes in the price level have not been taken into account. N Inventories by Departments — December 31, 1947 As compared w ith a year ago (Compiled January 30, and released for publication January 31) Major Household Appliances...............................................................................+177 Men’s Clothing.....................................................................................................+ 6 0 Domestic Floor Coverings............................................................................... ...+ 46 Men’s and Boys’ Shoes........................................................................................+ 36 Shoes (Women's and Children’s ) ....................................................................... + 22 Sport Goods (Including Cameras).......... ....................................................... ...+ 17 Dresses (Women's and Misses’) ....................................................................... .. + 15 Corsets and Brassieres.........................................................................................+ 9 Infants’ W ear..................................................................................................... ...+ 9 M illinery............................................................................................................ ...+ 8 China and Glassware...........................................................................................+ Women’s Underwear............................................................................................ + Silverware and Jewelry.................................................................................... ... + Neckwear and Scarfs........................................................................................... + Silks and Velvets (Woolen Dress Goods)....................................................... ...+ Domestics and Blankets.................................................................................. M A IN S T O R E T O T A L ................................................................................. Cotton Wash Goods......................................................................................... Notions.............................................................................................................. Luggage.............................................................................................................. 7 6 6 5 5 + 3 + 2 —0— — 1 — 4 Furniture and Beds........................................................................................... ..— 4 Juniors’ and Girls’ W ear..................................................................................... — 4 Toilet Articles and Drug Sundries.................................................................. ..— 7 Coats and Suits (Women’s and Misses’) ......................................................... .. — 8 A rt Needlework and Art Goods........................................................................ — 10 Leather Goods (S m all).................................................................................... ..— Furs.................. ................................................................................................. ..— Books and Stationery....................................................................................... ..— Housewares....................................................................................................... ..— Aprons and Housedresses................................................................................. ..— 10 11 11 12 12 Blouses, Skirts and K nit Goods...................................................................... ...— Hosiery (Women’s and Children’s)................................................................. ...— Men’s Furnishings (Hats and Caps)................................................................ ...— Draperies and Curtains.................................................................................... ...— Laces and Trimmings..........................................................................................— 13 15 14 18 18 Lamps and Shades............................................................................................ Boys' Clothing and Furnishings...................................................................... Handkerchiefs................................................................................................... Gloves............................................................................................................... Toys and Games............................................................................................... — — — — — 19 20 23 23 36 The decline in department store inventories in the Fourth District during the heavy sales of December was approximately in line w ith seasonal expectations. A t month and year end, stock levels in the main store were about 2% over those of December 31, 1946, while basement store stocks were up about 1%. Stocks of major household appliances increased during December to the highest point on record, 177% above a year ago. Inventories of domestic floor coverings also reached a new all-time high, 46% above a year ago. B y contrast, year-to-year decline ranging from 12% to 19%, occurred in the stocks of housewares, draperies and curtains and lamps and shades. Inventories of men’s clothing, up 60% from a year ago, were higher on December 31 than at most monthly closing dates during 1947 and a t an all-time high for this tim e of year. Stocks of men’s and boys’ shoes, up 36%, reached a new record high for the month. A t the other extreme, inventories of boys’ clothing and furnishings, down 20% from a year ago, were a t lowest levels in nearly two years. Stocks of men’s furnishings, off 15% from last year, were at a level hardly more than half of November closing inventories. Few departments in the women's apparel and accessories group showed large inventory gains over last year. Stocks of women’s and children’s shoes, up 22%, reached a new all-time high for the month and were only slightly under the November level. Also reaching new high levels for the month were stocks of women’s and misses’ dresses, corsets and brassieres, and infants’ wear. Increases over last year ranged from 9% to 15% in these departments. Seven departments in the women’s apparel and accessories group registered declines from last year amounting to 10% or more. Stocks of furs, for example, were down 11%, and were a t a three-year low for the month. Stocks of handker chiefs, off 23%, were lowest since February 1945. Stocks of gloves, were down 23% from a year ago. Stocks of sport goods a t the end of December were a t a new high for the month, 17% over a year ago. Stocks of toys and games, on the other hand, were 36% under last year, and a t the lowest level for any month end since January 1945. B oth departments enjoyed heavy sales during December. Inventories of books and stationery, down 11% from December 1946, were at a three year low for the month. A ll comparisons herein refer to dollar volume and not to physical inventories. February 1, 1948 Page 11 Monthly Business Review FINANCIAL AND OTHER BUSINESS STATISTICS Time Deposits— 12 Fourth District Cities Bank Debits*— December, 1947 (Compiled January 12, and released for publication January 13) (In Thousands of Dollars) (Compiled January 13, and released for publication January 14) December 1947 % Change from year ago A L L 29 C E N T E R S ................ J7,814,534H +17.7% 10 L A R G E S T C E N T E R S : Akron..............................Ohio 245,196 — 3.8 Canton............................ Ohio 118.297H +14.1 Cincinnati.......................Ohio 1.016.643H +18.9 Cleveland....................... Ohio 2.056.510H +19.9 Columbus....................... Ohio 590.861H +29.3 Dayton........................... Ohio Toledo............................ Ohio Youngstown....................Ohio E rie ............................. Penna. Pittsburgh...................Penna. 252.356H 413,837 156,847 93.662H 2.158.860H T O T A L ............................... $7,103,069H 19 O T H E R C E N T E R S : Covington-Newport........ K y. $ 41.2UH Lexington......................... K y. 130.695H H am ilton........................Ohio 42.463H L im a ...............................Ohio 43.322 Lorain............................. Ohio 19.768H % Change from year ago $20,865,280H +14.1% +22.5 + 2.9 +29.2 +10.3 +18.4 738.521H 325.081H 2.689.194H 5.366.167H 1.533.987H + 0.3 +13.5 +12.5 +12.8 +16.2 703.593H 1.180.591H 459.765H 261.871H 5.727.152H +17.9 + 6.4 +28.3 +13.6 +18.4 +17.9% $18,985,922H +14.2% +11.0% +23.8 +35.9 + 9.9 +25.5 +10.6% +14.6 +30.8 +12.6 +24.2 Mansfield........................Ohio Middletown.................... Ohio Portsmouth....................Ohio Springfield......................Ohio Steubenville................... Ohio 41.721H 36.275H 21,545 47.084H 24.801H +18.0 +18.7 +10.5 +12.4 +16.1 Warren............................ Ohio Zanesville.......................Ohio Butler.......................... Penna. Franklin...................... Penna. 'Greensburg..................Penna. 37,337 27.570H ' 31.599H 7,492 22.659H +14.1 +21.8 +10.8 + 7.1 +17.5 Meadville.................... Penna. O il C ity .......................Penna. Sharon......................... Penna. Wheeling......................W . Va. 11,529 20.552 27.850H 75.992H T O T A L ............................... $ 711.465H 3 Months ended Dec. 1947 —10.6 — 4.3 +23.3 +16.9 $ 116.932H 242.574 116.108H 128.787H 56.574H 118.644H 101.283H 64.548H 134.969H 68.867H +19.6 +13.3 +13.1 +10.4 +14.4 111.618H 75.465H 91.089H 21,639 63.236H +12.1 +17.3 +13.1 + 8.4 +17.7 36,221 59,933 80.302H 190.569H + 9.9 — 0.7 +19.8 +10.9 +15.2% $ 1.879.358H +12.7% H denotes new all-time high for one month or quarter-year. * Debits to all deposit accounts except interbank balances. Bank debits were at an all-time high in the Fourth District during December. The total for 29 cities stood at $7,815,000,000, almost 18 percent higher than the $6,640,000,000 of a year ago and about 15 percent above the previous all-time high of $6,800,000,000 which was set last October. The year-to-year gain of almost 18 percent was the greatest experienced since last May. T E N LA R G E ST C IT IE S New all-time highs were set in seven of the ten largest cities during December. In Pittsburgh and Cleveland debits exceeded the $2 billion mark for the first time and in Cincinnati the total moved above $1 billion. From a year-to-year standpoint, the outstanding advances were reported by Columbus and Youngstown where the gains exceeded 29 percent. Other cities where the year-to-year gain was above the overall average of 18 percent for the largest cities were Dayton, Cleveland, Cincinnati and Pittsburgh. N IN E T E E N SM A LLER C E N T ER S Thirteen of the smaller centers experienced record-high debit totals during December. Covington-Newport, Hamilton and Mansfield reached the $40 million level for the first time and in Wheeling the $75 million mark was surpassed. The largest year-to-year gain occurred in Hamilton where an increase of almost 36 percent was experienced. Four other cities, including Lorain, Lexington, Sharon and Zanesville, exceeded the 20 percent mark. Homestead, Pa. is no longer listed among the smaller centers because of a merger w ith a reporting bank in Pittsburgh. The accompanying table shows the volume of debits to all deposit accounts (except interbank balances) in 30 cities of the Fourth District. Most of the debits represent transfers of funds by check although debits to (withdrawals from) savings deposits and U. S. Treasury deposits at reporting banks are also included. December Department Store Sales by Cities* (Compiled January 26, and released for publication January 28) Sales During December % Change from ( Dec. 1941 = 100) C IT Y _____________ Nov. *47 Dec. ’46 1941 1943 1945 1946 1947 143 169 Erie................................ +45 +18 100 111 199 Wheeling........................ +44 +10 152 100 108 180 198 Springfield..................... +40 +13 132 151 100 165 187 139 Pittsburgh..................... +35 +11 100 181 108 201 Toledo........................... +35 +12 149 100 113 181 203 Canton........................... +32 +10 100 133 115 185 204 Akron............................. +30 + 9 100 189 130 161 207 Fourth District.............. +29 +12 100 112 145 205 184 Cleveland...................... +28 +11 100 106 132 174 193 Youngstown................... +27 +14 100 116 156 188 214 Columbus...................... +25 + 4 100 129 178 223 232 Cincinnati...................... +10 100 116 157 196 214 +20 * Based on daily average sales. C ity and Number of Banks Time Deposits Dec. 31. 1947 Average Weekly Change During: 5 Weeks 4 Weeks 5 Weeks Ended Ended Ended Oct . 29, 1947 N ov. 26,1947 Dec. 31,1947 Cleveland (4)............... $ 879,322,000H Pittsburgh (12)............ ......361,697,000 Cincinnati (8)............... ......181,540,000 Akron (3)...................... ......103,933,000H Toledo (3)...........................92,467,000H 73.217.000H Columbus (3)............... Youngstown (3)............ 62.910.000H Dayton (3)................... ......49,361,000 Canton (5)...........................42,955,000 Erie (4)......................... ......38,544,000 Wheeling (6)................. 28,329,000 10.662.000H Lexington (5)................ +$ 98,000 + 31,000 + 193,000 + 43,000 + 62,000 + 52,000 — 23,000 + 22,000 + 98,000 + 22.000 + 6,000 —0— +1431,000+$3,007,000 — 28,000 — 318,000 — 623,000 + 80,000 — 85,000 + 269,000 — 5,000 + 176,000 + 23,000 + 88,000 + 117,000 + 221,000 — 79,000 — 27,000 — 85,000 — 5,000 — 14,000 — 207,000 — 87,000 — 107,000 + 6,000 + 16,000 TOTAL—12 Cities....... $1,924,937,000H +$604,000 -$429,000 +$3,193,000 H denotes all-time high. During December, time deposists a t 59 Fourth District banks advanced to a new all-time high of $1,925,000,000, about 5 percent higher than the total of a year ago. The average weekly gain of $3,193,000 for December offers a sharp contrast to the decline of $429,000 weekly which occurred in the preceding month and compares favorably w ith the increases recorded in corresponding weeks a year ago. The December gains in time deposits in part reflect a seasonal expansion which ordinarily is experienced around the turn of the year. An additional factor of im portance is the year-end addition of accrued interest to some savings accounts. The outstanding gain for December occurred at the Cleveland banks, where time deposits increased by over $3,000,000 weekly in the eighth successive month of expansion. Exceptionally large gains also were experienced in Akron, Toledo and Youngstown. Other cities where increases occurred were Cincinnati, Columbus, and Lexington. Time deposits declined during December in five of the twelve reporting cities. Retail Trade Percentage Changes From Preceding Year SALES SALES ST O C K S Dec. Year Dec. ___________________________________________________ 1947 1947 1947 D E P A R T M E N T ST O R E S (96) Akron................................................................. ........+13 Canton............................................................... ........+14 Cincinnati.......................................................... ....... +14 Cleveland.......................................................... ........+15 Columbus.......................................................... ........+ 8 Erie.................................................................... ........+23 Pittsburgh......................................................... ....... +16 Springfield......................................................... ........+18 Toledo........................................................................+17 Wheeling............................................................ ....... +15 Youngstown...............................................................+18 Other Cities....................................................... ....... +35 D istrict......................................................................+16 W E A R IN G A P P A R E L (14) Cincinnati.......................................................... ........+16 Cleveland.......................................................... ........+ 2 Pittsburgh......................................................... ....... + S Other Cities....................................................... ....... +18 D istrict.............................................................. ....... +10 F U R N IT U R E (44) Canton............................................................... ........+ 4 Cincinnati.......................................................... ........+27 Cleveland...................................................................+13 Columbus...................................................................+35 D ayton...................................................................... + 7 Pittsburgh......................................................... ........a Allegheny County............................................. ........+29 Toledo........................................................................+12 Other Cities...............................................................+27 District.............................................................. ........+20 +7 +10 +8 +8 +5 +13 +10 +8 +9 +2 +11 +27 +10 +3 a — 3 +4 — 3 +10 + 1 a +7 +4 a +16 + 2 -0— 6 — 4 +4 — 1 +16 — 1 — 9 +6 +1 +4 + 7 +8 +13 +8 a +25 +11 +20 +12 +23 +14 +32 a a a a a +33 +25 a—N ot available. Figures in parentheses indicate number of firms reporting sales. A new all-time record in aggregate dollar volume of department store sales was established in this District last month. The increase over November exceeded the normal seasonal expansion. December sales of stores in each of eleven major cities were the highest on record for the month. Daily average sales during the month were 29% larger than in November, and 12% greater than in December of 1946. The year-to-year percentage change in total sales, however, was about 16% ahead because of one more business day in December of 1947 than in the 1946 month. INDIVIDUAL CITIES The November-December rise in daily average sales was most marked in Erie and Wheeling where the improvement was 45% and 44% respectively. The district average figure of 29% was surpassed also by Akron, Canton, Pittsburgh and Toledo where the month-to-month expansion ranged from 30% to 35%. Erie showed the widest margin over the preceding year as average daily sales mounted 18% over the similar 1946 period. In Springfield and Youngstown, the gains were 13% and 14% respectively. In seven of the eleven centers, December sales were more than double the December 1941 volume. Columbus topped the list in th is respect w ith December sales 232% of December 1941, while in Cincinnati and Youngstown the figure stood at 214%. Page 12 February 1, 1948 Monthly Business Review NONFERROUS C A S T IN G S INDUSTRY (Continued from page 8) Shipments of Nonferrous Castings by K ind of Metal, in the Six Leading States, 1946 (in millions of pounds) Total Copper and Aluminum Copper-base Castings Alloy Castings O hio.................. .......336 Illinois......................230 Pennsylvania. . 219 M ichigan ......... .......188 New York........ .......155 California................109 161 112 171 77 87 61 94 39 17 30 30 31 Zinc Castings Magnesium Castings 79 76 30 74 37 * 1.2 * * 2 .0 * * *Not shown separately to avoid disclosing operations of individual companies. Source: Bureau of the Census Three Types of Aluminum Castings As a Percentage of Total Annual Shipments 1942 - 1947 Total (100%) (millions of pounds) 194 2 .........324 194 3 .........460 .........514 194 4 194 5 .........395 194 6 .........389 1947 (est.)........ .........440 Sand 64% 66 62^ 54 41 36 Permanent Mold 18^% 19^ 203^ 27^ 40 40 Mr. Howard W . Jordan, President of the Pennsyl vania Rubber Company, Jeannette, Pennsylvania, was redesignated Chairman of the Pittsburgh Branch Board of Directors for the year 1948. Mr. Josiah M . Koch, Vice President of the Quaker State O il Refining Corporation, O il City, Pennsylvania, and Mr. T. C. Swartz, Executive Vice President of the Woodlawn Trust Company, Aliquippa, Pennsylvania, were reappointed Directors of the Pittsburgh Branch for three-year terms ending December 31, 1950. Mr. J. H. McCoy, President of The City National Bank & Trust Company of Columbus, Columbus, Ohio, was reappointed a member of the Federal Advisory Council representing the Fourth Federal Reserve District for the year 1948. ★ ★ ★ Die 17% 14^ 16 18 19 24 Source: Bureau of the Census AN N O U N CEM EN TS During the month of January, the Federal Re serve Bank of Cleveland recommended, and the Board of Governors of the Federal Reserve System approved, the following changes in this bank’s dis count rates and buying rate on bankers’ acceptances. Discounts for and advances to member banks: a) Advances secured by Government obligations and discounts of and advances secured by eligible paper: Rate raised from one percent to one and onefourth percent per annum, effective January 12, 1948. O n January 2, Mr. George C. Brainard, President and General Manager of the Addressograph-Multigraph Corporation, Cleveland, Ohio, was redesig nated Chairman of the Board of Directors of this bank for the year 1948. b) Other secured advances to member banks: Rate raised from one and one-half percent to one and three-fourths percent per annum, effective January 12, 1948. O n the same date, Mr. Reynold E. Klages, Presi dent of the Columbus Auto Parts Company, Colum bus, Ohio, was redesignated Deputy Chairman for the year 1948. Minim um buying rate on bankers’ acceptances: Rate was raised from one percent to one and one-fourth percent per annum, effective Jan uary 26, 1948. Mr. A. Z. Baker, Chairman of the Board of The Cleveland Union Stock Yards Company, and Presi dent of the American Stock Yards Association, Cleve land, Ohio, was reappointed a Class C. Director of this bank for a three-year term ending December 31, 1950. Dr. Francis H. Bird, Dean of the College of Busi ness Administration, University of Cincinnati, Cin cinnati, Ohio, was redesignated Chairman of the Cincinnati Branch Board of Directors for the year 1948. Mr. Walter H. J. Behm, President of The Winters National Bank and Trust Company of Dayton, Day ton, Ohio, and Mr. Paul G. Blazer, Chairman of the Board of the Ashland O il & Refining Company, Ash land, Kentucky, were reappointed Directors of the Branch for three-year terms ending De Cincinnati http://fraser.stlouisfed.org/ cember 31, 1950. Federal Reserve Bank of St. Louis ★ ★ ★ The Board of Governors of the Federal Reserve System has recently published a pamphlet entitled “Federal Reserve Policy”. The pamphlet contains the following papers: “Three Decades of Federal Re serve Policy”, by Karl R. Bopp; “Impact of the War on the Member Banks, 1939-1946”, by Robert V. Rosa; “Selective Instruments of National Credit Policy”, by Carl E. Parry; and “Problems of Postwar Monetary Policy”, by Woodlief Thomas and Ralph A. Young. Individual pamphlets may be purchased for 25 cents each' or for 15 cents each for group purchases of ten or more in single shipment. Orders should be sent to the Division of Administrative Services, Board of Governors of the Federal Reserve System, Wash ington 25, D. C.
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