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l\10NTHL Y REVIEW Agricultural and Business Conditions TENTH FEDERAL RESERVE DISTRICT VoL. 25, No. 1 FEDERAL RESERVE BANK OF KANSAS CITY JANUARY 31, 1940 Business in the Tenth Federal Reserve District DECEMBER 1939 COMPARED WITH DECEMBER 1938 WYO. ! i ----------i.--.• % DECREASE % INCREASE 40 30 20 10 10 20 30 40 - I Denver• COLO. ·--------KANSA ■ I ' I' I •I ' ·--·-·--··-··-··-r-l--- I Financial YEAR 1939 COMPARED WITH YEAR 1938 % DECREASE % INCREASE 40 30 20 10 10 20 30 40 ___ Bank Debits_ I ■ I F. R. Bk. Clearings_ ■ !<ANS. BUSINESS INDICATORS -Mem. Bk. Loans_ __ .Mem. Bk. Invest._ ■ I I ·- Demand Deposits_ I _Life Ina. Salea_ Trade I A glance at the chart shows that December was somewhat poorer than a year ago. Bank deposits and loans, however, were higher as was true of other financial figures. Trade held nearly even and the movement of hogs to market and the slaughter of hogs and cattle were better than a year ago. Cash farm income continues favorable. But construction activity was much lower as were lumber sales. Life insurance sales slumped badly from the high level of late 1938. Production of flour, coal, zinc, and lead was under a year ago. Marketings of grain and cattle and sheep were less. Rain and snow in December and January have improved the moisture situation. However, only about half of the fall planted wheat in the District had germinated and wheat that comes up after the snow melts has little chance. But the moisture has helped sentiment and improved the outlook for next season. -,1 ·-• •I I t• •••• I - Dept. Store Salea_ -·- __ Lumber Sales_ I Marl,eting• _ __Wheat_ _ _ _ _ Corn _ _ _ _ _oats _ _ _ _ __cattle_ _ I ■ • _Retail Sales_ ■ •• •• I _ Wholesale Sales_. I • _ _ Calves _ _ __ __Hoga _ _ __ __Sheep _ _ -· I Pr0tluction I _ _Flour_ _ _Cattle Slaughter_ I __ Calf Slaughter_. ·- _Hog Slaughter_ _ I I I ...Sheep Slaughter_ ■ __crude Petroleum_ _ Bituminous Coal_ ■ Conatruction •• • _.Total Awarda __ _____Rea. Awarda __ I ■ ■ -· I Zinc Ore Shipments Lead Ore Shipments _ Value of Permits __ M i,cellaneous +58 ______ Rainfall ___ •I Ca11h Farm Income • ______ Employment___ _______ Pay Roll11 _____ •For previous month -- - . • ... - 2 REVIEW OF AGRICULTURAL AND BUSINESS CONDITIONS Member Bank Operations The rapid rise in loans at reporting member banks in the Tenth District in the last half of 1939 leveled off at the end of the year and loans declined somewhat in the first half of January, reflecting principally a decrease in commercial loans. Investments, which had increased substantially in the last quarter of 1939 after declining during the first three quarters, again declined early in January. Holdings of Treasury bills and notes dropped substantially and the decrease was offset only in part by sizable increases in holdings of Government bonds, guaranteed obligations, and other securities. Loans are 15 per cent larger than a year earlier but investments are 3 per cent smaller. Adjusted demand deposits at reporting member banks declined slightly from the middle of December to the middle of January but there was an increase in deposits of other banks at these reporting banks, in reserves carried at this bank, and in correspondent balances carried at other banks. Adjusted demand deposits are 7, interbank deposits and reserves 18, and correspondent balances 16 per cent greater than a year earlier although well under the record levels of last October. Principal items of condition of 51 member banks: Loans and investments-total........ Loans-total... ................................... Coml., indust., agric ........................ Open market paper......................... To security brokers and dealers.... Other to purchase or carry secur.. Real estate loans............................. Loans to banks................................. All other loans................................. Investments-total.. ......................... U.S. Treasury bills......................... U.S. Treasury notes....................... U.S. Govt. bonds ............................. Oblig. guar. by U.S. Govt............. Other securities............................... Reserve with F. R. Bank................... Balances with domestic banks ......... Demand deposits-adjusted ............ Time deposits ..................................... U.S. Govt. deposits........................... Interbank deposits ............................ *Comparable figures not available. Change from Jan.17 Dec.13 Jan.18 1940 1939 1939 ·( In thousands of dollars) 681,124 -12,706 +26,256 295,663 -3,552 +37,572 180,435 -4,035 +23,273 17,985 +357 +243 3,461 -591 -1,440 9,833 -171 -1,630 27,305 +860 +4,803 429 -99 -273 56,215 + 127 + 12,596 385,461 -9,154 -11,316 13,554 -13,404 * 67,499 -14,158 : 105,689 +9,007 60,812 +3,264 +10,146 137,907 +6,137 +820 193,054 +3,399 +28,987 320,.365 +13,876 +45,189 535,209 -4,288 +32,597 145,573 +2,445 +1,342 23,846 +59 +1,741 422,153 +5,016 +64,073 Reserve Bank Operations Note circulation of this bank reached a new high level slightly above 185 million dollars in the third week of December when circulation normally is at the highest point of the year because of the seasonal demand for currency for Christmas shopping. This amount compares with about 172¼ million at the same time in 1938, 170 million in 1937, and 163 million in 1936. Circulation is seasonally lower in January with the return flow of currency after the holiday period. Principal items of condition of the Federal Reserve Bank of Kansas City and branches: Change from Jan.17 Dec.13 Jan.18 1940 1939 1939 ( In thousands of dollars) 364,112 -11,734 +54,095 917 -131 -69 Zero Zero -16 168 -15 -77 525 -25 -125 115,928 +2,843 -16,170 519,368 -13,865 +37,709 180,675 -1,550 +12,466 268,693 +7,301 +33,813 Total reserves............................... Bills discounted............................ Bills purchased................·-·········· Industrial advances..................... Commit. to make indust. adv...... U.S. Govt. sec., direct & guar.... Total assets................................... F. R. notes in circulation............. Member bank reserve deposits.. Dollar volume of check collections in December was about 3 and for the entire year was nearly 6 per cent larger than in 1938. Dollar volume in 1939, however, fell 5 per cent short of that for 1937. Check collections through this bank and branches : ITEMS 1939 December.............. November.............. Year....................... 6,147 5,755 71,198 AMOUNT 1938 1939 1938 (In thousands) 6,476 $ 1,034,600 $ 1,008,396 5,895 1,014,840 921,143 70,824 11,427,086 10,822,414 Bank Debits Debits to individual accounts by banks in reporting centers of the District in 1939 were about 3 per cent larger than in 1938 but 10 per cent smaller than in 1937. Debits increased considerably more than is usual during December when volume of payments by check was about 4 per cent above a year earlier. Payments by check for the years 1939 and 1938: Albuquerque, N. Mex ......... .. Atchison, Kans .................... . Bartlesville, Okla ................ . Casper, Wyo .......................... Cheyenne, Wyo .................... . Colorado Springs, Colo ....... . Denver, Colo ......................... Emporia, Kans .................... . Enid, Okla ............................ . Fremont, Nebr ..................... . Grand Junction, Colo .......... . Guthrie, Okla ....................... . Hutchinson, Kans ................ . Independence, Kans ............ . Joplin, Mo ............................. . Kansas City, Kans .............. . Kansas City, Mo .................. . Lawrence, Kans ................... . Lincoln, Nebr ....................... . Muskogee, Okla ................... . Oklahoma City, Okla .......... . Okmulgee, Okla ................... . Omaha, Nebr ........................ . Pittsburg, Kans .................... Pueblo, Colo ......................... . Salina, Kans ......................... . St. Joseph, Mo ................ ..... . Topeka, Kans ....................... . Tulsa, Okla ........................... . Wichita, Kans ...................... . 1939 1938 Change ( In thousands of cfoIG.rs) (%) 190,427 171,742 +10.9 35,407 36,303 -2.5 352,884 330,224 +6.9 73,420 72,384 +1.4 99,603 100,959 -1.3 172,171 169,939 +1.3 1,890,399 1,820,432 +3.8 37,432 37,411 +0.1 131,751 132,549 -0.6 31,739 29,176 +8.8 45,142 41,718 +8.2 17,942 20,361 -11.9 135,125 137,287 -1.6 33,302 32,493 +2.5 119,176 108,664 +9.7 200,789 181,872 +10.4 3,685,068 3,536,094 +4.2 42,864 41,011 +4.5 342,525 323,129 +6.0 96,106 90,806 +5.8 1,231,871 1,199,636 +2.7 30,564 31,155 -1.9 1,728,551 1,659,758 +4.1 43,345 44,604 -2.8 188,662 201,855 -6.5 101,344 109,072 -7.1 326,517 300,609 +8.6 220,617 212,246 +3.9 1,563,332 1,641,412 -4.8 530,065 530,511 -0.1 District, 30 cities, year. ........ 13,698,140 U.S., 141 cities, year............ 389,536,084 District,30 cities, December. 1,329,678 U.S., 141 cities, December... 40,019,144 13,345,412 373,397,040 1,283,204 39,929,600 +2.6 +4.3 +3.6 +0.2 FEDERAL RESERVE BANK OF KANSAS CITY Trade RETAIL SALES Department store sales in the District last summer had shown improvement over the preceding year but lagged badly during the fall, because of exceptionally mild weather, and for the entire year 1939 were only 1 per cent above 1938. December sales were 2 per cent larger than in the same month of 1938 but in the first two weeks of January dollar volume has dropped about 6 per cent under a year earlier although retail prices are about 4 per cent higher. Retail inventories are about 3 per cent heavier than a year ago. Collections on open accounts averaged 47.0 per cent in December as compared with 48.4 per cent last year, while installment collections averaged 16.7 per cent, the same as a year earlier. Department store sales and stocks in leading cities: SALES Dec. '39 No. of comp.to Stores Dec. '38 (Per Denver............... 4 +0.9 Kansas City...... 5 +4.9 Oklahoma City. 3 -2.2 Omaha............... 3 +3.4 Tulsa .................. 4 +2.4 Wichita.............. 3 +2.2 Other cities....... 18 +1.9 District.............. 40 +2.2 STOCKS Year '39 Dec. 31, '39 comp. to comp. to Year '38 N ov.30,'39 Dec.31,'38 cent increase or decrease) +2.1 -17.6 -0.2 +3.0 -24.0 +o.8 +1.3 -23.2 +12.0 -0.5 -16.7 +1.8 Zero -25.7 +3.4 +o.3 +0.1 -18.3 +4.4 +1.3 -10.2 +2.5 Total retail sales in the District in December were 2 and for the entire year 1939 about 4 per cent larger than in 1938. New Mexico and Wyoming sales for the year increased about 4, Colorado 2, Nebraska 1, and Missouri 6 per cent, while sales in Kansas and Oklahoma showed virtually no change. Sales of independent retail stores reported by the Department of Commerce: Dec. 1939 per cent change from Dec. 1938 Colo. Kans. Mo. Nebr. N.Mex. ~ Wyo. Apparel........... +0.1 -1.9 +2.5 +7.9 +3.0 -5.0 -3.2 Automobile..... +9.4 -0.4 +4.8 +1.5 +11.3 -7.5 +1.3 Country genl.. -3.6 -2.1 +o.8 -5.6 -4.5 -8.5 +12.4 Department.... +0.4 +3.7 +4.6 +3.4 +5.0 -1.9 Drug................ +4.6 Zero +3.7 +2.9 +4.8 -0.3 +2.6 Furniture........ +2.7 -4.6 +7.8 +8.5 -6.8 -5.2 -8.9 Grocery........... -7.0 -9.7 -4.3 -5.5 -1.0 -8.4 -7.2 Hardware ........+15.7 +10.4 +7.7 +3.8 -4.2 Lbr. & mtls ..... -0.4 +o.9 +8.1 -4.1 +3.5 -14.8 +22.1 3 1939. Collections in December averaged 84.2 per cent as compared with 88.5 per cent last year. Wholesale sales and stocks reported by the Department of Commerce for this District: SALES No. of Firms -Auto. supplies .... 4 Clothing .............. 3 Drugs.................. 3 Electrical goods. 6 Farm products ... 10 Furniture............ 3 Groceries ............. 26 Hdwe.-totaL. ... (12) Gener~L............ 3 IndustriaL........ 4 Plbg. & htg ....... 5 Machinery........... 3 Tobacco & prod.. 7 All other lines .... 21 Total... ................. 98 STOCKS Dec. '39 Year '39 Dec. 31, '39 comp.to comp. to comp. to Dec. '38 Year '38 Nov.30,'39 Dec.31,'38 ~ r cent increase or decrease) +9.3 +0.3 -10.0 -5.3 -37.9 -10.2 -0.7 -6.9 +4.2 Zero +32.3 Zero +18.4 -0.7 -5.9 -18.6 +4.9 +10.9 -10.8 -2.3 -8.8 +13.2 -2.2 +5.5 +2.5 +o.8 + 7.5 -0.5 +3.5 +4.8 -10.1 -2.1 +8.7 +3.9 -8.5 +9.2 +120.0 -2.5 +o.4 +4.8 -2.4 +4.9 +2.3 -5.2 +0.3 -5.2 +6.6 Rainfall COLORADO Denver.......................... Leadville....................... Pueblo........................... Lamar........................... Garnett......................... Steamboat Springs..... Dec. 1939 Year 1939 Total Normal Total Normal ~ inche~ .26 .73 7.58 14.05 .61 1.08 12.83 18.63 .41 .50 8.86 11.67 1.12 .61 9.71 15.80 .19 .21 4.59 6.93 1.50 1.96 19.07 23.12 KANSAS Topeka.......................... Iola................................ Concordia..................... Salina............................ Wichita......................... Hays.............................. Goodland....................... Dodge City................... Elkhart......................... MISSOURI St. Joseph ..................... Kansas City................. Joplin ............................ .74 .86 .54 .60 .95 .70 1.10 .89 1.62 .98 1.30 .63 .77 1.00 .62 .56 .57 .54 22.33 26.26 19.89 18.13 28.91 15.85 16.81 12.64 9.51 33.55 38.08 26.55 27.27 30.11 23.69 18.70 20.51 17.51 .72 .68 1.43 1.29 1.33 2.16 26.67 34.72 39.00 35.56 37.11 43.99 .62 .94 .78 .40 .88 .64 .57 .77 .93 .80 .81 .75 .51 .54 .59 .57 19.20 19.73 16.74 16.56 14.63 11.93 13.18 18.58 27.77 27.78 28.24 27.02 19.64 18.36 16.30 18.86 1.44 .57 .56 .42 .74 .44 12.26 13.45 7.91 16.65 14.27 9.45 1.37 1.28 .93 .94 .89 1.13 1.21 1.98 2.67 1.50 1.66 1.34 1.18 .88 27.94 33.19 27.50 26.42 20.91 24.43 20.35 38.81 43.33 31.15 34.76 28.31 30.64 25.88 .26 .40 .07 .24 .55 .99 .68 .64 9.83 8.93 7.95 16.40 15.02 15.44 12.71 15.07 NEBRASKA Omaha.........................Lincoln Norfolk......................... Grand Island................ McCook......................... North Platte................ Bridgeport.................... Valentine ...................... NEW MEXICO Total... ............. +1.5 -0.6 +4.0 +1.5 +4.4 -1.5 +3.3 WHOLESALE SALES The value of wholesale sales in this District for the year 1939 was little changed from 1938. Sales had expanded sharply early in the fall but subsequently declined, December sales falling 5 per cent under a year earlier. Of the principal lines, sales of drugs and groceries for the year were slightly smaller, while sales of furniture and hardware were considerably better. Wholesale inventories, which had declined about 13 per cent during 1938, rose nearly 7 per cent during Clayton......................... Santa Fe....................... Farmington.................. OKLAHOMA Tulsa............................. McAlester..................... Oklahoma City............ Pauls Valley................. Hobart.......................... Enid ............................... Woodward .................... WYOMING Cheyenne...................... Casper........................... Lander.......................... Sheridan....................... 4 REVIEW OF AGRICULTURAL AND BUStNESS CONbITIONS Rainfall in 1939 throughout the greater part of the District was only 65 to 80 per cent of normal. Precipitation was much above normal early in the year but spring and summer moisture was short and the fall was unprecedentedly dry. The moisture situation has improved somewhat since the rains and heavy snows of late December and early January. December precipitation was about normal in Nebraska, Kansas, and New Mexico, but was little more than half the usual amount in Oklahoma, Wyoming, and Colorado. Prospects for the winter wheat crop, although improved by the recent moisture, are still quite poor. Because of fall drought, the condition of winter wheat on December 1 was the lowest of record and continued to deteriorate rapidly until late December, since which time there has been little change. Much of the acreage sown has not come up or has sprouted and died, while wheat that has made some growth is generally thin and spotted. Supplies of both topsoil and subsoil moisture are markedly deficient, the deficiency in subsoil moisture having limited greatly the root development of wheat plants. Grain Marketing Marketings of wheat in 1939 declined about 10, corn 22, and oats 14 per cent. These decreases reflected much smaller crops in 1939 than in 1938, continued low prices during the first eight months of the year with a consequent storing of larger quantities of wheat and corn under Government loans, and some holding of grain by producers in anticipation of higher prices due to the war. Receipts of wheat in 1939 were only 4 but of corn 40 and oats 17 per cent below the average of the past ten years. In December, marketings of all grains were about 40 per cent below average. Grain receipts at five District markets in 1939: Wheat Hutchinson.......................... Kansas City........................ Omaha............·---····· St.Joseph............................ Wichita............................... . 20,497,000 80,549,000 21,566,000 11,280,000 27,837,000 Year 1939............................ Year 1938............................ Dec. 1939............................. Nov.1939............................. Dec. 1938............................. 161,729,000 179,280,000 4,499,000 4,736,000 8,933,000 Corn (In bushels) 11,230,000 11,074,000 3,501,000 77,000 Oats 2,118,000 4,156,000 3,942,000 57,000 25,882,000 10,273,000 32,991,000 11,959,000 2,920,000 528,000 4,006,000 456,000 3,578,000 1,342,000 Farm reserves of grain in the District on January 1, 1940, including wheat and corn under Government seal, were considerably lower than a year earlier. Stocks of wheat were 3, corn 12, and oats 21 per cent under the average for that date from 1929 to 1938. · Cash wheat and corn prices, which late in the summer had been at the lowest point in about five years, advanced sharply in the first week of September at the outbreak of war. Wheat retained virtually all of its early September upturn and showed a further sharp advance in the first three weeks of December, rising to the highest level in two years and reflecting principally the very poor outlook for next season's winter wheat crop. Prices have since receded somewhat, influenced by rains and snows late in December and in January. Corn prices lost nearly all of their early September advance almost immediately but have since risen gradually to regain most of the decline. Wheat prices are substantially above and corn prices are now very close to the Government loan level. The lower ran_ge of cash prices at Kansas City: No. 1 hd., dk. wheat, bu .. No,. 2 mixed corn, bu ....... No. 2 white oats, bu ........ No. 2 rye, bu ..................... No. 2 barley, bu .............. . No. 2 white kafir, cwt.... . Jan.23 1940 $ .98¾. .59½ Dec.30 1939 $1.01½ .58¼ .42½ .40¾. .69 .55 .66 .55 1.10 1.06 Nov. 30 Dec. 31 1938 1939 $ .87¼ $ .70¾. .48½ .53¾. .29¾. .39 .55 .46½ .40 .52 .75 1.10 Livestock MARKETINGS Marketings of cattle in 1939, despite some forced liquidation because of fall drought, were little changed from 1938, while receipts of calves were somewhat larger and of sheep slightly smaller than in the preceding year. Hog receipts, reflecting the sharp upswing in hog production, increased 34 per cent. Marketings of calves were equal to the average of the past ten years but receipts of cattle were 12, hogs 32, and sheep 11 per cent below average. In December, marketings of hogs were only 2 but of cattle 21, calves 12, and sheep 20 per cent under average. Livestock receipts at six District markets in 1939: Denver...................... Kansas City............. Oklahoma City........ Omaha...................... St. Joseph....·-····-···· Wichita ..................... Cattle 509,425 1,387,000 418,391 1,183,802 313,480 289,081 Hogs Calves 341,799 112,412 325,075 1,829,971 516,806 185,187 128,153 1,629,276 58,404 822,377 73,876 389,370 Sheep 2,836,820 1,366,593 216,023 1,716,920 1,026,079 236,987 Year 1939................. Year 1938................. Dec. 1939.................. Nov. 1939................. Dec. 1938................. 4,101,179 4,085,708 269,436 404,805 276,673 883,107 842,356 66,882 117,416 64,650 7,398,422 7,721,121 349,739 537,801 400,166 5,529,599 4,114,749 714,083 626,974 490,100 PRICES Cattle prices in the first half of 1939 were much above those in 1938 and sheep prices were appreciably higher throughout most of the year while hog prices were substantially lower. Livestock prices generally tended downward during the first eight months of the year and then rose spectacularly at the outbreak of war in the first week of September. Although under pressure from heavier marketings after the price rise, beef steer and lamb prices held about half of the early September upturn and at the close of the year were about the same as a year earlier. These prices were FEDERAL RESERVE BANK OF KANSAS CITY strengthened in part by a broad demand for stocker and feeder animals from Corn Belt states and by higher prices for by-products such as hides and wool. Hog prices, however, lost all of their upturn, falling to a new five-year low of $5.25 a hundredweight in December and again in January. Top livestock prices at the Kansas City market: Jan. 23 Dec. Nov. Dec. Year Year 1940 1939 1939 1938 1939 1938 --(I.n dollars per hundredweight)- 11.25 11.00 11.25 13.50 14.00 13.50 9.75 10.00 10.00 9.50 10.50 9.50 9.00 9.00 9.35 8.75 10.75 10.75 11.50 10.00 10.00 10.00 11.00 10.00 5.40 6.80 6.65 7.55 8.75 10.05 7.50 7.75 7.90 7.70 8.85 8.00 9.35 9.10 9.75 9.15 11.35 10.15 Beef steers........... . Stocker cattle....... . Feeder cattle......... Calves................... . Hogs ...................... . Sheep...................... Lambs ................... . STOCKERS AND FEEDERS Countryward shipments of stocker and feeder livestock from public markets increased markedly in 1939, reflecting a generally profitable price level for producing and feeding livestock. Shipments of cattle were 8 and calves 72 per cent above and of sheep about equal to the ten-year average. December shipments of calves were 13 per cent above average, but those of cattle and sheep dropped 20 per cent under average. Stocker-feeder shipments from 4 markets in 1939: Denver...................... Kansas City............. Omaha...................... St. Joseph ................. Year 1939................. Year 1938................. Dec. 1939.................. Nov. 1939................. Dec. 1938.................. Cattle Calves 221,156 64,467 654,986 168,821 312,139 57,468 67,141 17,100 1,255,422 1,177,268 67,993 170,361 88,619 307,856 182,641 17,989 59,188 21,504 Hogs 1,012 28,562 9,228 12,898 Sheep 941,241 200,192 405,206 180,781 51,700 45,554 3,996 3,901 4,222 1,727,420 1,533,311 61,509 242,167 61,059 On January 1, 1940, the number of cattle and lambs on feed in Wyoming, Nebraska, and Missouri was above a year earlier but in Colorado, Kansas, and Oklahoma the number was lower, a sharp decrease in lamb feeding in Kansas and Oklahoma being accounted for largely by a lack of wheat pasture. New Mexico is feeding fewer cattle and more lambs. In contrast with heavy feeding operations in other sections of the country, cattle feeding in this District is generally much below the level in most years before 1934, owing to the succession of drought years and greatly reduced feed grain production since that time. Rain and snow late in December and in January necessitated heavy supplemental feeding of livestock but greatly improved the outlook for ranges and pastures, which had suffered severely from fall drought, and relieved somewhat the acute shortage of stock water that had developed. Cattle and sheep generally are in good condition and feed supplies are ample for the reduced numbers of livestock on hand if the winter should not be severe. 5 PIG CROP The 1939 fall pig crop in the District was 23 and the combined spring and fall crop was 33 per cent larger than a year earlier. Declining hog prices and rising corn prices in recent months, however, have checked this upward trend in production, and the prospective number of sows to farrow next spring shows a decrease of 5 per cent from the number farrowed last spring. Production in 1939 was the largest in six years but about a fourth less than in the years 1931 to 1933. Department of Agriculture pig crop estimates: PIGS SAVED Fall 1939 1938 Colo ........................ 222 Kans ....................... 1,062 Mo ........................... 2,285 Nebr ....................... 948 64 N.Mex ................... Okla ........................ 863 Wyo ........................ 16 152 798 1,926 820 48 676 15 SOWS FARROWED Spring Spring 1939 1938 *1940 1939 -(In thousands) 283 165 41 48 1,376 855 206 217 2,614 2,092 430 413 3,077 2,128 452 502 67 54 11 12 887 632 132 143 40 63 10 11 -- 7 States .................. 5,460 4,435 8,367 5,966 1,282 1,346 U.S ........................ 31,985 27,651 52,317 43,450 8,580 8,549 *Number indicated to farrow from breeding intentions reports. Farm Income Cash farm income in the District in the first eleven months of 1939 was 8 per cent larger than in 1938. About half of this increase was due to larger Government payments, which were 57 per cent greater than a year earlier, and half to larger income from livestock and its products, which increased about 7 per cent. Receipts from the sale of crops were little changed. The sharp advance in farm commodity prices after the first of September was an important factor in sustaining income as a severe slump during the summer had largely erased the gains made earlier in the year. November income was up 14 per cent. Department of Agriculture farm income estimates: Nov. 1939 Colorado..................... . Kansas ......................... Missouri ...................... Nebraska................... . New Mexico ............... . Oklahoma.................... Wyoming.................... Seven states............... United States............. Nov. 11 Mos. 11 Mos. 1938 1939 1938 (In thousands of dollars) 13,878 13,104 114,113 105,603 17,710 16,171 239,833 229,191 30,929 26,480 235,793 227,135 21,271 19,448 217,829 185,134 14,114 8,314 48,754 37,417 17,519 17,951 161,501 158,585 4,880 3,952 43,794 37,001 120,301 740,000 105,420 707,000 1,061,617 7,075,000 980,066 6,900,000 By states, farm income for 1939 in Wyoming and Nebraska is up 18, New Mexico 30, Colorado 8, Kansas 5, Missouri 4, and Oklahoma 2 per cent. The large increase in Nebraska reflects a greater volume of corn loans as well as higher income from livestock, while sharply lower income from wheat partly accounts for the relatively small increase in Kansas and Oklahoma. 6 REVIEW OF AGRICULTURAL AND BUSINESS CONDITIONS Meat Packing Pack_e rs' purchases of cattle and sheep in 1939 remained about 15 per cent below the average of the past ten years but purchases of calves dropped nearly 25 per cent below average, reflecting a heavy country demand that greatly reduced the proportion of market receipts going to immediate slaughter. Hog slaughter in 1939 rose substantially to a level about threefourths of normal. The December slaughter of cattle was 18, calves 24, and sheep 17 per cent below but of hogs 9 per cent above average. Packers' purchases at District markets in 1939: Denver...................... Kansas City............. Oklahoma City........ Omaha...................... St. Joseph ................. Wichita..................... Year 1939................. Year 1938 ................. Dec.1939 .................. Nov.1939 .................. Dec.1938 .................. Cattle Calves Hogs 183,138 37,270 281,537 579,370 124,491 1,738,473 196,354 115,944 351,908 723,589 69,664 1,414,121 224,669 40,787 742,026 126,190 47,853 350,992 2,033,310 2,078,191 154,989 166,426 137,824 436,009 495,761 32,122 44,579 33,711 4,879,057 3,637,156 642,222 577,541 433,439 She~ 382,598 1,021,381 122,823 1,069,572 787,327 174,267 3,557,968 3,635,602 236,219 255,975 259,03 0 Cold Storage Holdings United States cold storage stocks, except for a less than seasonal increase in holdings of beef and a larger than seasonal decrease in butter stocks, generally tended to increase during December. January 1 holdings of beef were 30, pork 7, shell eggs 22, and butter 13 per cent below the average for that date during the past five years, which include the drought period, while stocks of poultry were 21 and lard 69 per cent above the average. United States cold storage holdings: Beef, lbs................................. Pork, lbs ................................. Lamb and mutton, lbs.......... Poultry, lbs ............................ Miscellaneous meats, lbs..... Lard, lbs ................................. Eggs, shell, cases.................. Eggs, frozen (case equiv.). Butter, creamery, lbs........... Cheese, all varieties, lbs...... Jan. 1 Dec. 1 Jan. 1 Aver. 1940 1939 1939 '35-'39 (In thousands of units) 78,988 67,672 58,187 112,014 467,416 332,272 430,104 501,981 4,890 4,187 3,541 4,850 167,458 127,649 139,108 137,977 93,823 68,970 72,040 94,355 161,319 88,955 107,421 95,550 533 1,580 302 679 2,065 2,509 1,797 2,048 55,468 89,783 128,770 64,050 108,183 112,217 120,174 107,256 Flour Milling Southwestern flour production in 1939 was slightly larger than in the preceding year and somewhat above the average of the past ten years, reflecting chiefly the record volume of output in September. At the outbreak of the war, flour prices rose sharply with wheat, consumer buying was greatly stimulated by war hysteria, and September milling operations averaged nearly 90 per cent of capacity. Operations subsequently declined by December to 66 per cent and output, although above average, fell 6 per cent under a year earlier. Export sales increased markedly late in December prior to the abandonment of the Government subsidy early in January. Flour output reported by the Northwestern Miller: Dec. 1939 Kansas City........ 553 Salina.................. 218 Wichita ............... 141 Other cities......... 1,043 Dec. Year Nov. 1939 1938 1939 (In thousands of barrels ) 7,246 586 580 219 235 2,635 2,046 153 175 13,068 1,062 1,087 Year 1938 7,480 2,349 1,927 12,757 Southwest........... 1,955 2,014 2,083 24,995 24,513 United States*... 6,228 5,301 6,473 72,961 66,697 *Represents about 60 per cent of total output in United States. Petroleum Crude oil production in the District declined about 4 per cent during 1939, owing to smaller output in the first quarter of the year and to a shutdown of wells in the latter half of August to protect the price of crude. Following the shutdown, output rose rapidly to its former level and in December was 4 per cent above a year earlier and 5 per cent above the average of the past ten years. Oil production reported by the American Petroleum Institute and the Bureau of Mines: Dec. 1939 Colo .................. Kans ................ N.Mex ............ Okla................. Wyo ................. 123 5,465 3,383 13,292 2,013 5 States ........... 24,276 U. S ................ . 115,907 Year Nov. Dec. 1939 1939 1938 ( In thousands of barrels) 1,404 110 107 60,741 5,652 4,826 3,427 3,039 37,238 159,431 13,502 13,816 1,938 1,561 21,537 24,626 111,887 23,352 102,447 280,351 1,265,353 Year 1938 1,412 60,064 35,759 174,994 19,022 291,251 1,214,355 Stocks of crude petroleum dropped sharply at the time of the shutdown, showing a decline of about 15 per cent for the year. Prices of crude oil and gasoline generally were weak throughout the year but prices of other refined products are strong, due in part to the war. Field operations were more active in the last half of 1939. Coal Bituminous coal production in the District in 1939 was little changed from that in 1938 and about 10 per cent less than the average of the past ten years. December output was 14 per cent under a year earlier. Coal output estimated from reports of the National Bituminous Coal Commission: Dec. 1939 Colo .................. Kans.and Mo .. N.Mex ............ Okla ................. Wyo ................. 579 681 121 158 482 6 States ........... 2,021 U.S .................. 37,283 Year 1938 Year Dec. Nov. 1939 1938 1939 ~thousands of tons) 5,676 718 653 5,918 701 627 1,271 122 135 1,400 206 166 5,293 602 557 5,676 5,972 1,252 1,477 5,200 19,558 387,930 19,577 342,407 2,125 42,835 2,362 36,541 FEDERAL RESERVE BANK OF KANSAS CITY Zinc and Lead Production, shipments, and stocks of zinc in the Tri-State district increased slightly during 1939. Shipments of lead also increased, rising 13 per cent, but output dropped 8 per cent and stocks declined substantially. Stocks of both zinc and lead are very low. The December shipment of zinc was 18 and that of lead 6 per cent smaller than a year earlier. Ore shipments from the Tri-State district in 1939: ZINC ORE LEAD ORE Tons Value K~nsas.:························· 121,965 $ 4,106,482 M1ssour1......................... 28,657 992,034 Oklahoma...................... 246,009 8,444,682 Tons Value 17,569 $1,014,303 3,707 216,030 37,547 2,150,602 Year 1939 ....................... Year 1938....................... Dec. 1939....................... Nov.1939 ...................... ~ Dec. 1938......................., 58,823 $3,380,935 52,117 2,690,060 4,959 320,119 5,097 328,939 5,298 282,030 396,631 $13,543,198 384,426 10,700 062 31,585 1,295:016 35,040 1,541,745 38,333 1,035,491 Ore prices had risen sharply at the outbreak of war last .S eptember, but zinc has since lost half its advance. Zinc is selling at about $38 and lead $65 a ton as compared with $29 and $54, respectively, a year ago. Employment and Pay Rolls Employment in the District both in December and for the year 1939 was about 2 per cent above that in 1938, while pay rolls were about 5 per cent larger than in the preceding year. Preliminary figures of the Department of Labor: December 1939 Year 1939 Employment Pay Rolls Employment Pay Rolls ( Per cent change from a year ago) Colo .................. . -5.9 -4.9 -3.4 -11.0 Kans ................. . +4.4 +8.o -0.8 +6.4 Mo .................... . +5.1 +9.7 +4.7 +10.8 Nebr .................. -0.7 +o.8 +5.2 +3.1 N.Mex ............. . -3.3 -7.2 -7.3 -2.8 Okla ................. . +o.3 +3.1 -2.3 -2.3 Wyo .................. . -4.7 -3.2 -4.2 +1.1 7 States............. +2.1 +5.3 +1.7 The value of building permits issued in reporting District cities increased about 28 per cent during 1939, following a decline of 11 per cent in the preceding year. The value of December permits, however, was 21 per cent smaller than in the same month of 1938. Building permits for the years 1939 and 1938: PERUITS ESTIMATED COST 1039 1938 963 814 549 672 700 615 8,046 6,422 732 760 276 201 410 374 2,018 1,728 2,402 1,990 2,033 2,000 1,843 1,601 897 793 227 178 180 156 247 226 768 756 1,810 1,503 2,729 2,980 1939 1938 $ 2,689,000 $ 1,924,000 1,043,000 1,140,000 1,146,000 507,000 10,667,000 7,603,000 740,000 740,000 475,000 479,000 2,759,000 1,988,000 2,716,000 3,446,000 2,905,000 1,419,000 4,612,000 5,577,000 5,375,000 1,939,000 821,000 528,000 428,000 390,000 157,000 93,000 1,280,000 282,000 1,179,000 1,864,000 4,558,000 3,262,000 2,872,000 3,176,000 Year................................. 26,830 23,769 December........................ 1,587 1,392 November........................ 2,196 1,763 $46,422,000 $36,347,000 2,570,000 3,262,000 3,133,000 3,753,000 Albuquerque, N. Mex ... . Cheyenne, Wyo .............. . Colorado Springs, Colo. Denver, Colo ................... Hutchinson, Kans ......... . Joplin, Mo ...................... . Kansas City, Kans ........ . Kansas City, Mo ............ . Lincoln, Nebr .................. Oklahoma City, Okla .... Omaha, Nebr ................. . Pueblo, Colo .................... Salina, Kans .................. . Shawnee, Okla............... . St. Joseph, Mo ............... . Topeka, Kans ................. . Tulsa, Okla ..................... . Wichita, Kans ................. Lumber Board feet sales of lumber at reporting retail yards in the District were little changed in 1939 from the preceding year. Sales during the first five months of the year had been much above 1938 but subsequent declines erased this gain, December sales being 14 per cent smaller than a year earlier. Lumber stocks, which had decreased about 9 per cent in 1938, declined slightly further in 1939. Collections in December averaged 35.5 per cent as compared with 36.9 per cent a year ago. Lumber trade at 150 retail yards in the District: Dec.1939 per cent change from Nov. 1939 Dec. 1938 +4.4 BuildinJ?: Value of construction awards in the Kansas City area (Nebraska, Kansas, Oklahoma, and western half of Missouri) declined 8 per cent during 1939, owing to sharply lower awards for public works construction and nonresidential building toward the end of the year. Awards in December were only half and in the forepart of January two-thirds of a year earlier. Construction figures of F. W. Dodge Corporation: Sales of lumber, board feet ........................ Sales of all materials, dollars ................... . Stocks of lumber, board feet ..................... . Outstandings, dollars ................... ............... -29.8 -13.7 -25.5 +o.8 -10.3 -3.6 -2.2 +0.2 Life Insurance Life insurance sales in the District in 1939 were only 2 per cent smaller than in 1938 but December sales fell 38 per cent under a year earlier. The Life Insurance Sales Research Bureau report: Dec. 1939 Dec. Dec. Year Year 1938 1939 1938 ~ (In thousands of dollars) 2,653 3,652 39,467 33,721 2,294 4,850 35,551 44,492 2,524 13,780 27,581 45,863 4,487 1,396 25,331 15,007 Colo ............... . 5,788 Kans .............. . 6,804 Mo .................., 17,525 Nebr .............. . 5,687 N.Mex .......... . 1,548 Okla ............... . 8,421 Wyo ......... ........ 1,134 Kansas City area................ 11,958 23,678 127,930 139,083 37 Eastern states................ 354,098 389,439 3,550,543 3,196,928 7 States....... .. 46,907 U.S ................ 567,212 Residential building..........., Nonresidential building..... Public works construction. Utility construction............ 7 Nov. Dec. Year 1939 1938 1939 (In thousands of dollars) 4,754 7,811 59,602 6,447 12,041 77,224 17,277 28,638 207,452 5,533 9,570 65,389 1,071 1,856 13,223 7,769 13,728 96,703 930 1,474 12,887 43,781 537,951 75,118 897,886 532,480 6,425,633 Year 1938 61,275 82,463 204,234 65,136 13,668 104,783 13,229 544,788 6,358,006 8 REVIEW OF AGRICULTURAL AND BUSINESS CONDITIONS NATIONAL SUMMARY OF BUSINESS CONDITIONS By the Board of Governors of the Federal Reserve System INDUSTRIAL PRODUCTION Industrial activity, after a rapid rise in recent months, declined less than seasonally in December. In the first half of January activity did not show the usual seasonal increase. Distribution of commodities to consumers was maintained in large -yolume. PRODUCTION 70 i - - - ~ 1 - - - - - - 1 - - - - - t - - - - + - - - - + -- - - l 70 60 - - - ~ - ~ - - ~ - - . . . . . . . . . . L - - - - ' - - --......., 60 1934 1935 1936 19 37 1938 1939 Index of physical volume of production, adjusted for seasonal variation, 1923-1925 average =100. By months, January, 1934, through December, 1939. DEPARTMENT STORE SAL[S AND STOCKS PE!ICENT l"E RCEHT 11 0 110 100 PO ~ - 90 80 80 70 70 60 GO 50 50 40 40 1934 1935 1936 1937 1938 1939 Indexes of value of sales and stocks, adjusted for seasonal variation, 1923-1925 average =100. By months, January, 1934, through December, 1939. EMPLOYMENT WHOLESALE PRICES P£RCD<T PERC£r1T 110 Industrial output decreased in December, but by a smaller amount than is usual at this season, with the consequence that the Board's index, which allows for usual seasonal var iations, advanced further from 124 to 128 per cent of the 1923-1925 average. As in other recent months, the rise in the index continued to reflect mainly increased activity in industries producing durable goods. Automobile production rose sharply in December owing to the reopening of plants of one large producer which had been closed for almost two months. Plate glass production also increased. At steel mills activity was maintained near the high level that prevailed in October and November; fourth quarter production of steel ingots was greater than in any other three-month period on record. Output of zinc and deliveries of tin continued to increase in December, and lumber production declined less than seasonally. In the nondurable goods industries, where production had been at high levels throughout the autumn, changes in output in December were largely seasonal in character. At woolen textile mills, however, there was a considerable reduction in activity, and activity at silk mills declined to a low level, reflecting in part continued high prices of raw silk. Output of crude petroleum continued at a high rate in December, while coal production was reduced, following a large volume of output in the two preceding months. In the first half of January steel ingot production was at a somewhat lower level than in December, while automobile assemblies were maintained at about the same high rate as in the previous month. Value of construction contracts awarded, as reported by the F. W. Dodge Corporation, increased further in December, owing to the inclusion in the December figures of a large amount for a dam under construction by the Tennessee Valley Authority. Contracts for private building, both residential and nonresidential, declined seasonally. 110 100 100 90 90 80 80 70 70 60 60 According to reports from leading industrial states, factory employment decreased less than seasonally in December and pay rolls showed a further advance. DISTRIBUTION 50 50 1934 1935 1936 1937 1938 1939 Distribution of commodities to consumers increased further in December. Sales at variety stores showed about the usual sharp rise and sales at department stores and mail-order houses increased more than seasonally. Freight carloadings declined by more than the usual seasonal amount from November to December, reflecting chiefly a further reduction in coal shipments and a decrease in loadings of ore, which had been at a high level in the previous month. COMMODITY PRICES Prices of wheat, which had advanced sharply early in December and continued at the higher level during the rest of the month, declined considerably in the first half of January. Smaller decreases occurred in some other commodities, including hides, tin, and zinc. Prices of most other basic commodities, such as cotton, wool, lead, and steel scrap, showed little change. Index compiled by the United States Bureau of Labor Statistics, 1926=100. By weeks, 1934 through week ending January 13, 1940. MEMBER BANKS IN 101 LEADING CITIES lltl.UONS OF DOI.LARS 12 GOVERNMENT SECURITY MARKET Prices of United States Government securities continued to advance during December and were steady during the· first two weeks of January. 6 0 - ~ '3 4 - - ~ - - ~ - - ~1935 1936 1937 ---'---~ 0 1938 1939 Wednesday figures for reporting member banks in 101 leading cities, September 5, 1934, through January 10, 1940. Commercial loans, which include industrial and agricultural loans, represent prior to May 19, 1937, so-called "Other loans" as then reported. BANK CREDIT Total loans and investments of reporting member banks in 101 leading cities declined in the four weeks ending January 10, following an increase during the first half of December. These changes reflected largely a temporary rise and a subsequent decline in loans to security brokers and dealers in connection with the Government's flotation of a new issue of bonds. Total holdings of United States Government obligations at city banks showed little net change during the period. As a result chiefly of further increases in gold stock as well as the postholiday return of currency from circulation, excess r eserves of member banks increased sharply in the four weeks ending January 10.
@FedFRASER