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REVIEW MONTHLY Agricultural and Business Condi/tons TENTH FEDERAL RESERVE DISTRICT VoL. 24, No. 11 NOVEMBER FEDERAL RESERVE BANK OF KANSAS CITY 30, 1939 Business in the Tenth Federal Reserve District OCTOBER 1939 10 MOS. 1_939 COMPARED WITH OCTOBER 1938 i % DECREASE i ---------L---.•: Dtnver• COLO. % INCREASE 40 30 20 10 I 30 40 • ·--------:' KANSAS • ' ·-·--··-··-··--·-r-!--- -- 10 20 KANS • ■ are lower. I ■ ■ _ Wholeeale Salea_. I __ Retail Salea_ I __ Dept. Store SalM_ • • Marketin6• _ _Wheat_ _ _ _ _ oate _ _ ___ cattle_ _ --• --· •• ■ Production ___ Flour_ _ • I _Cattle Slaughter __ I __ Calf Slaughter_ _Hoe Slaughter__ ■- _Sheep Slaughter_ I ...Crude Petroleum_ ■ __Bltumfnoue CoaL Zinc Ore Shfpmente Lead Ore Shipmen~ Con•truction _ Total Awards __ • ____Res. Awarda_ •• • ■ _ Value of Permlte._ M i,cellaneoria ,9 __ __Rainfall __ __ Ca1h Farm Income.• ____Employment__ ■ -= - ■ - - --B<>P-_ __Sheep _ _ • ■ __ __CalH•-- ■ ~- I _Lumber Salea_ I ·- I Trade ■ . - • • -Life ln1. Salea_ -■ ■ !ii ...Demand Depoefta_ • -■ I I _Jdem. Bk. Invest._ _ _ Corn _ _ ■ % INCREASE 10 20 30 40 -Mem. Bk. Loan,_ • -ss % DECREASE 40 30 20 10 F. R. Bk. Clearing,_ • Light rains near the middle of November brought some relief in parts of the District, but Nebraska, Wyoming, and the western half of Kansas remain dry. This moisture improved somewhat the condition of winter wheat but the outlook is still the most unfavorable in years. The amount of wheat and corn coming to market is scarcely half what it was last year, but cattle, calves, and hogs are being marketed and slaughtered in much larger numbers. Wholesale trade has declined following a sharp increase in September but still is nearly 4% above a year ago. Retail trade is little changed. Lumber sales, reflecting less active construction, are down nearly 10%. Life insurance sales are nearly 7 % above last year. Production of coal and lead and zinc is much higher. Bank deposits, loans, and check transactions are appreciably above a year ago but investments Financial COMPARED WITH 10 MOS. 1938 -Bank Debita_ ■ I BUSINESS INDICATORS -- --·····Pa:, Roll.I _ _ •For ornlo111 month -··- ■ I ■ 2 REVIEW OF AGRICULTURAL AND BUSINESS CONDITIONS Member Bank Operations Loans at reporting member banks in the Tenth District continued to rise between the middle of October and the middle of November and are now back to where they were at this time in 1937 when the volume of loans had been the largest since the early part of 1932. Nearly all types of loans increased during the four weeks. Investments increased sharply further from the low point of the year at the first of October, reflecting principally the purchase of Treasury bills, Government bonds, and obligations guaranteed by the Government. Holdings of Treasury notes declined slightly while holdings of other securities showed a small increase. Loans are now 15 per cent larger than a year ago but investments are down 3 per cent. Adjusted demand deposits at reporting member banks, their reserve balances at this bank, and their correspondent balances at other banks, which had been at record levels about the middle of October, declined somewhat during the following four weeks while deposits of other banks at these reporting banks rose to a new high. Adjusted demand deposits are 8 and deposits due to banks 17 per cent larger than a year ago while reserves are 19 and correspondent balances 18 per cent greater. 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 Nov.15 Oct. 18 Nov. 16 1939 1939 1938 (In thousands of dollars) 678,786 +23,240 +25,846 290,434 +7,144 +38,159 178,350 +4,668 +25,723 16,840 +178 -958 3,108 -68 -1,049 9,754 +222 -2,093 26,005 +440 +3,392 966 +431 +193 55,408 + 1,273 + 12,951 388,352 + 16,096 -12,313 15,007 +5,099 * 83,313 -835 * 100,574 +6,085 * 57,322 +5,112 +6,830 132,136 +635 +4,078 188,684 -10,173 +29,799 340,007 -16,598 +50,930 530,507 -8,480 +38,286 145,232 +675 +1,727 22,947 -103 +2,452 441,071 +3,307 +62,408 Reserve Bank Operations Note circulation of this bank continues to increase, reaching a new high level above 181 million dollars in the first week of November and averaging about 180½ million in the first half of the month as compared with 178¼ million in October and 176 million in September. Circulation is about 11½ million above last year. Volume of discounts has risen somewhat in recent weeks, reflecting in part seasonal borrowing by banks in connection with crop payments in sugar beet areas. Principal items of condition of the Federal Reserve Bank of Kansas City and branches: 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.. Change from Nov.15 Oct.18 Nov.16 1939 1939 1938 (In thousands of dollars) 360,121 -4,817 +35,275 1,537 +830 +486 Zero -16 -16 185 -16 -208 567 -9 -9 117,413 -3,123 +4,164 526,816 -1,632 +40,887 180,396 +2,177 +11,62.8 263,334 -12,779 +33,262 Dollar volume of check collections increased further as is usual during October. Dollar volume in October was 9 and in the first ten months of the year 6 per cent larger than last year. Check collections through this bank and branches: ITEMS 1939 October................ .. September............ . Ten months .......... . 6,083 5,698 59,296 AMOUNT 1939 CTn thousands) 6,170 $1,056,556 5,679 980,561 58,453 9,377,646 1938 1938 $ 965,412 908,852 8,892,875 Bank Debits Debits to individual accounts by banks in reporting centers of the District declined during October although an increase is usual in that month. However, debits had shown a large contraseasonal increase in the preceding month. Volume of payments by check for October was 4 and for the first ten months of the year 2 per cent larger than a year ago. Payments by check in thirty District cities: 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 ................... . District, 30 cities................ United States, 141 cities... Change from Oct. 1939 Sept. 1939 Oct.1938 (In thousands of dollars) 16,948 +1,539 +725 3,022 -186 +9 30,522 -277 +179 -341 7,778 +1,554 9,425 -68 +849 15,796 -1,216 +1,293 172,697 +336 ' +897 3,787 +576 +271 9,808 -1,479 -635 2,556 -147 +174 4,283 -21 +347 1,592 -222 +141 + ·335 10,623 -1,530 2,522 +102 +8 11,498 +1,906 +935 16,560 +1,842 +1,111 324,227 -25,131 +30,309 3,968 +509 +243 30,769 +1,788 +827 9,805 +952 +498 101,593 +4,012 +2,535 2,579 -186 -1 149,527 -10,542 +4,462 3,845 +123 +315 17,718 -2,542 -2,759 9,157 +1,135 +180 29,219 -237 +2,120 15,612 -712 -2,603 128,791 -108 +13,604 44,898 -24 +400 1,191,125 32,711,305 -16,893 +45,067 -952,860 ·-524,009 8 FEDERAL RESERVE BANK OF KANSAS CITY Wholesale sales and stocks reported by the Department of Commerce for this District: Trade RETAIL SALES Department store sales in the District declined contraseasonally during October and fell slightly under a year ago. Sales were above last year in the first half of the month but were curtailed by warm weather toward the close. The month had the same number of business days but one less Saturday this year than last. In the first three weeks of November, sales were only 2 per cent larger than last year. Retail prices, according to the Fairchild Index, are gradually rising and currently are 3 per cent higher than a year ago. Stocks of merchandise increased considerably more than is usual during October and are now slightly above·· a year ago. Collections on open accounts averaged 44.1 per cent in October as compared with 47.3 per cent last year, while installment collections averaged 17.2 and 15.8 per cent, respectively. Department store sales and stocks in leading cities: SALES STOCKS Oct. '39 10 Mos.'39 Oct. 31, '39 No. of comp.to comp. to comp. to Stores Oct. '38 10 Mos.'38 Sept.30,'39 Oct.31,'38 - - ~ r cent increase or decrease) Denver_.............. 4 -1.2 +2.5 +4.2 -3.9 Kansas City...... 5 +3.4 +2.6 +12.7 +1.1 Oklahoma City. 3 -4.3 +2.9 +11.7 +9.5 Omaha.............. ~ 3 -4.0 -0.6 +11.1 -0.1 Tulsa........._........ 4 -2.0 -0.5 +8.7 +8.6 Wichita....·-········ 3 +2.0 +o.3 Other cities ....... 18 +o.3 -0.1 +6.0 +0.8 District............ _. 40 -0.5 . +1.4 +8.5 +0.6 Total retail sales in the District in October and in the first ten months of the year were about 4 per cent larger than in the corresponding periods last year. Sales of independent retail stores reported by the Department of Commerce : Oct. 1939 per cent change from Oct. 1938 Colo. Kans. Mo. Nebr. N.Mex. ~ Wyo. Apparel... ........ -4.9 +0.6 +3.6 +2.7 -8.5 -1.3 -9.1 Automobile ..... +33.5 +13.4 +67.6 +12.1 -12.0 +11.2 +16.1 Country genl.. -9.0 -4.7 -0.9 -2.6 +0.3 -15.9 +9.5 Department.... +2.4 -0.6 +6.7 -5.4 -20.4 -5.7 Drug············-··· -1.1 -5.6 +0.9 +0.2 -0.2 -4.8 -3.1 Furniture........ +14.4 +2.2 +7.4 -0.9 -4.9 -4.8 - 6.2 Grocery........... -4.7 -9.4 -5.4 -4.9 -1.9 -7.0 -1.9 Hardware........ -1.8 +4.3 +9.7 +3.5 +6.1 Lbr. & mtls ... _.+12.3 +o.6 +1.8 +9.1 +8.4 +o.3 ---- Total................ +4.8 -0.4 +7.5 -0.9 -1.8 -2.4 +2.5 WHOLESALE SALES The value of wholesale sales in this District, which in September had been 15 per cent above a year ago, in October was less than 4 per cent above last year, reflecting principally a sharp decline in grocery sales from the high level of the preceding month. · Total sales so far in 1939 are little. changed from 1938. Wholesale inventories rose 6 per cent during October to a level 4 per cent above that at the close of October ·a year ago. Collections .in ·October averaged 71.3 per cent of receivables against 79.9 per cent last year. SAL~S STOCKS Oct. '39 10 Mos.'39 Oct. 31, '39 No. of comp.to comp. to comp. to Firms Oct. '38 10 Mos.'38 Sept.30,'39 Oct.31,'38 (Per cent increase or decrease) Auto. supplies.... 7 -12.8 -1.5 +3.9 -5.8 Drugs................... 11 +1.8 +o.3 +1.7 -0.1 Dry goods ........... 7 +12.2 +o.5 -5.3 -10.3 Electrical goods. 10 +27.2 +16.1 +5.0 +4.0 Farm products... 11 +26.4 .... +18.6 +2.0 Furniture ............ 5 + 13.9 + 11.5 + 10.3 + 16.8 Groceries ............ 38 -3.4 -1.6 +14.1 +11.6 Hdwe.-totaL. ... ( 15) +12.9 +5.7 +2.3 +1.3 General.. ........... 4 · -4.5 +2.0 +2.2 -1.5 Industrial......... 5 +45.5 +11.5 +2.5 +10.1 Plbg. & htg ....... 6 +27.6 +11.3 Jwlry.& opt.gds. 3 +45.5 +2.7 +3.6 Machinery........... 5 -5.4 +28.5 +1.4 Paper & prod ...... 3 +22.9 Tobacco & prod.. 7 -4.1 -3.0 All other lines .... 18 +9.7 +4.5 +1.9 +3.4 TotaL ................ 140 +3.7 +o.7 +6.3 +4.0 Crops The unprecedented fall drought was partially relieved in some sections of the District by rains that fell in the second and third weeks of November. Persistent dryness not only had delayed planting but had prevented germination of wheat sown in dry soil and had resulted in very poor stands of wheat that had sprouted. At the first of October, topsoil moisture in Oklahoma, Kansas, and Nebraska was less than a sixth and subsoil moisture less than a third of normal. By the first of November, topsoil moisture conditions had improved somewhat but the amount of moisture in the subsoil had dropped to about a fifth of normal. Soil moisture tests in Kansas at that time showed the topsoil dry to an average depth of 4.4 inches as compared with 3.3 inches a year ago. The average depth of soil moisture at seeding time was only 22.5 inches as compared with 28.1 inches last year. November rains fell slowly and were very beneficial in Missouri, in southeastern Nebraska, and in the eastern parts of Kansas and Oklahoma, but elsewhere in the District the situation remains critical. Where moisture has been received wheat is showing green and the outlook is generally better. Because of the lateness of the season, however, and the fact that plants have made little growth and stands are unusually thin and spotted, wheat is in rather poor condition to survive a dry or cold winter. Private estimates place the acreage of winter wheat seeded this fall in Kansas from 10 to 17 per cent below the acreage planted a year· ago. In Nebraska there has been a reduction of about 20 per cent, while th~ acre~ge estimates for Oklahoma range from 5 per cent below to 5 per tent above last year. .The estimate for Colorado shows a decrease of 20 to 30 per cent, Wyo- REVIEW OF AGRICULTURAL AND BUSINESS CONDITIONS 4 ming about 5, and Missouri 10 while that for New Mexico is little changed from last year. October rainfall in Wyoming was 73, New Mexico 77, and in Missouri 66 per cent of normal but in Oklahoma it was only 53, Colorado 50, Nebraska 42, and in Kansas 30 per cent of normal. For the two months, September and October, Oklahoma had only 32, Nebraska 30, and Kansas 19 per cent of normal rainfa I. smaller than the rather heavy receipts in October a year ago, were 21 per cent above average. October grain receipts at five District markets: Hutchinson ........................ . Kansas City....................... . Omaha................................ . St. Joseph .......................... . Wichita.............................. . Rainfall Oct.1939............................. Sept. 1939........................... Oct. 1938............................. 10 Mos. 1939....................... 10 Mos. 1938....................... Oct.1939 Total Normal COLORADO Denver.......................... Leadville...................... Pueblo Lamar........................... Garnett......................... Steamboat Springs..... KANSAS Topeka.......................... Iola ................................ Concordia..................... Salil'la Wichita ......................... Hays -····-·--·--·· Goodland...................... Dodge City................... Elkhart......................... .89 .34 .02 Zero .01 1.31 10 Mos.1939 Total Normal ---aii inchesf"1.05 7.31 12.77 1.26 11.89 16.62 7.94 10.81 .66 8.34 14.66 1.03 .64 4.37 6.40 17.32 19.67 1.97 .83 .62 .60 .69 1.41 .18 Trace .28 Trace 2.42 3.16 1.97 2.00 2.59 1.55 1.37 1.30 1.66 20.17 23.21 18.87 16.53 27.15 16.04 16.71 11.33 7.86 31.05 34.56 24.93 25.07 27.72 22.06 17.42 19.21 16.13 •95 .95 2.00 2.89 2.92 3.46 23.22 31.69 34.62 32.69 33.95 39.06 1.09 .93 .25 .10 .02 .66 .64 1.88 2.17 1.88 1.73 2.12 1.20 1.07 1.09 1.10 18.23 18.27 15.96 16.16 13.75 11.29 12.61 17.81 25.77 26.91 26.31 25.23 18.36 17.36 15.28 17.73 .02 1.20 .34 1.26 1.18 .81 9.87 12.14 6.88 16.51 12.85 8.15 1.88 3.47 2.39 2.68 2.09 .44 .06 3.68 4.27 2.86 3.47 3.04 2.92 2.22 24.79 29.75 25.73 23.58 19.86 22.88 18.74 34.35 37.82 27.78 30.78 26.31 27.86 23.33 .37 1.70 .31 .47 .96 1.41 1.36 1.07 9.51 8.53 7.88 16.16 13.92 13.46 11.35 13.79 MISSOURI St. Joseph ................... _ Kansas City................. Jopli NEBRASKA Omaha.......................... Linco]n Norfolk ......................... Grand Island ................ McCook......................... North Platte................ Bridgeport................... Valentine...................... NEW MEXICO Clayton......................... Santa Fe....................... Farmington................. OKLAHOMA Tulsa............................. McAlester.................... Oklahoma City............ Pauls Valley................ Hobart.......................... Enid.. Woodward. ................... WYOMING Cheyenne..................... Casper.......................... Lander.......................... Sheridan....................... Grain Marketing Wheat marketings continued to decline during October, falling 55 per cent below receipts in the same month a year ago and 45 per cent short of the October average of the past ten years. Holding by producers because of the unfavorable outlook for next year's crop, the unprecedented amount of wheat stored under Government loans, and an increasing amount of wheat being ·used to •pay crop insurance premiums largely account for these small receipts·. ·corn marketings increased further and, although about 40 per cent Wheat Corn (In bushels) Oats 757,000 2,464,000 599,000 347,000 1,035,000 1,087,000 2,418,000 575,000 9,000 158,000 338,000 396,000 6,000 6,202,000 6,241,D_00 11,432,000 152,495,000 162,271,000 4,089,000 2,793,000 6,884,000 18,966,000 24,449,000 897,000 1,157,000 1,070,000 9,290,000 9,967,000 Cash wheat prices, which had receded slightly from the high point of the early September upturn, recovered most of this small decline in October and the first half of November, influenced by the poor condition of fall planted wheat as well as by meager receipts. Corn prices, which had lost virtually all of their early September gain, have also strengthened. The lower range 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..... Nov.24 Oct. 31 Sept.30 Oct. 31 1939 1939 1939 1938 $ .85½ $ .84¾ $ .83¼ $ .64¾ .52½ .50¼ .40½ .48¾ .38¾, .24 .37¼ .32½ .53 .56 .63 .41½ .49 .48 .49 .37 1.05 1.05 .95 .63 Livestock MARKETINGS Marketings of cattle, calves, and hogs increased further during October. Part of this increase was due to usual seasonal influences but a combination of relatively strong prices and some forced liquidation because of a shortage of stock water and a lack of grass and grain pasturage was also a factor in cattle marketings. Receipts of sheep declined somewhat, the movement of lambs from western range areas apparently having reached its seasonal peak in the preceding month. Cattle receipts were 3 and calves 19 per cent above the October ten-year average but hog receipts were 17 and sheep 18 per cent below average. October livestock receipts at six District markets: Denver...................... Kansas City............. Oklahoma City....... . Omaha..................... . St. Joseph ................. Wichita.................... . Cattle 100,177 220,173 51,825 135,619 38,502 41,734 Oct. 1939.................. Sept.1939................. Oct. 1938. ................. 10 Mos. 1939............ 10 Mos. 1938............ 588,030 488,599 519,775 3,426,939 3,400,832 Calves 22,157 62,898 24,368 30,475 7,005 13,665 Hogs 30,022 179,902 51,127 112,935 71,965 41,257 Sheep 623,169 147,746 18,007 140,876 93,669 27,670 160,568 487,208 414,136 103,151 369,020 139,936 709,810 4,188,542 684,192, 3,236,902 951,126 1,020,387 993,016 6,510,882 6,857,277 PRICES Beef .cattle prices .have -held--better than .half ·and lamb prices about a third of the spectacular advance FEDERAL RESERVE BANK OF KANSAS CITY that took place early in September but hog prices have lost all of their upturn, the top price falling back by the third week of November to $5.65 a hundredweight as compared with the five-year low of $5.55 at the middle of August. This season normally is one of price declines for hogs and lambs, but this year lamb prices are supported in part by wool prices. Cattle prices, except for the heavier weights of beef steers, are generally strong. Top livestock prices at the Kansas City market: Nov. 24 Oct. Sept. Oct. Oct. Oct. 1939 1939 1939 1938 1937 1936 (In dollars per hundredweight) 11.25 11.25 11.85 12.50 16.00 10.40 10.00 10.35 10.50 9.25 9.25 7.60 925 925 10~5 925 10~5 825 10.00 10.00 11.00 10.50 10.00 9.00 5.65 7.20 8.76 8.60 11.45 10.20 7.10 8.00 7.00 7.00 8.25 7.50 9.10 9.65 10.50 8.65 10.75 9.20 ----------- Beef steers........... . Stocker cattle....... Feeder cattle........ . Calves..................... Hogs ...................... . Sheep .................... . Lambs .................... STOCKERS AND FEEDERS Countryward shipments of stocker and feeder livestock increased substantially further in October with market supplies of cattle and calves at the season's high level and shipments of sheep increasing despite smaller marketings. Demand for stocker and feeder livestock has been heavy from eastern Corn Belt states where feed and water conditions are much more favorable than in this District. The movement of cattle was 13, calves 71, and hogs 22 per cent larger than a year ago but that of sheep was 10 per cent smaller. Shipments of cattle were 12 and calves 83 per cent above the October ten-year average while hogs were 37 and sheep 18 per cent below average. October stocker-feeder shipments: Cattle 53,156 132,349 60,970 11,326 Calves 12,860 39,604 16,148 3,890 Hogs 34 3,098 986 792 Sheep 339,313 26,442 49,325 31,460 Oct. 1939..................... 257,801 Sept. 1939................... 194,869 Oct. 1938..................... 227,645 10 Mos.1939 ............... 1,017,068 10 Mos. 1938............... 927,031 72,502 38,695 42,531 230,679 125,755 4,910 4,950 4,030 43,803 37,337 446,540 350,245 496,211 1,423,744 1,284,552 Denver......................... Kansas City................ Omaha......................... St. Joseph................... 5 setting a prospective decrease in western states. The number of lambs to be fed is indicated as little changed in Missouri and Wyoming but larger in New Mexico and Nebraska, and operations in the Scottsbluff area of Nebraska and Wyoming are now expected to be at least as large this year as last. The number fed in Colorado will probably be from 15 to 25 per cent smaller than last year and the smallest for any season since 1926-27. A decrease appears likely in Kansas also. Little wheat pasture is available in Nebraska, Kansas, and Oklahoma. RANGES AND PASTURES The mild weather this fall has been unusually favorable for cattle and sheep, and livestock is generally going into the winter in fair condition. Prolonged drought and the rather poor condition of ranges, however, particularly in southeastern Wyoming, eastern Colorado, and in the western parts of Kansas and Oklahoma, necessitated much supplemental feeding and resulted in a considerable movement of livestock from the range to market as stockmen culled their herds and flocks closely. Farm Income Reflecting in part the spectacular rise in farm commodity prices following the outbreak of war in Europe, September cash farm income in the District was 22 per cent above last year. Receipts from crops were 11 and from livestock 18 per cent larger, while Government benefit payments, which were nearly four times what they were a year ago, accounted for about a third of the September increase. Department of Agriculture farm income estimates: Colorado ..................... . Kansas ....................... . Missouri.. ................... . Nebraska ................... . New Mexico ............... . Oklahoma .................. . Wyoming ................... . Sept. Sept. 9 Mos. 9Mos. 1939 1938 1939 1938 (In thousands of dollars) 14,191 11,882 78,389 75,231 26,811 21,836 200,789 195,164 24,689 22,542 175,534 175,392 21,591 14,983 170,150 146,828 6,380 4,074 24,775 20,903 18,069 16,398 122,849 122,752 7,903 6,282 30,305 25,223 Developments to early November indicated that Seven states............... 119,634 97,997 802,791 761,493 cattle feeding operations during the winter and spring United States............. 847,000 745,000 5,441,000 6,357,000 Total District income for the year to date is up of 1939-40 would be larger than seemed probable a about 5 per cent, principally because of larger Govmonth earlier. The increase in Corn Belt states is now expected to be larger than previously indicated and the ernment payments as returns from livestock are only decrease in western states somewhat smaller. The 3 per cent above and from crops 3 per cent below last number of cattle shipped into eastern Corn Belt states year. By states, Wyoming shows an increase of 20, during the four months, July through October, was New Mexico 19, and Nebraska 16 per cent but income the largest of record despite prices which, according in Colorado is up only 4 and in Kansas 3 per cent and to the Department of Agriculture, have been exceeded in Oklahoma and Missouri it is unchanged from a year ago. Increased returns from meat animals, chickens, in only three or four years during the,last twenty. Early in November, lamb feeding operations.- also :eggs, and wool· are mainly· responsible f9r the large were expected to be larger during the 1939-40 feeding ·g ains'fo Wyoming~and ·New Mexico and a substantial season, an increase in Corn Belt states.more than off- volume of corn loans for the gain in Nebraska. 6 REVIEW OF AGRICULTURAL AND BUSINESS CONDITIONS Meat Packing Operations at meat-packing plants in the District expanded considerably during October although a heavy demand for stocker and feeder livestock continues to restrict somewhat the proportion of market receipts going to immediate slaughter. Packers' purchases of cattle, calves, and sheep were about 10 per cent heavier than in October a year ago and purchases of hogs remain much above last year. The slaughter of cattle was 9, calves 16, hogs 5, and sheep 17 per cent below the October ten-year average. October packers' purchases at six District markets: ·Denver...................... Kansas City............. Oklahoma City........ Omaha...................... St. Joseph ................ Wichita ..................... Oct. 1939.................. Sept.1939................. Oct. 1938.................. 10 Mos. 1939............ 10 Mos. 1938............ Cattle 18,050 65,167 24,065 63,053 24,318 14,229 Calves 3,263 14,080 15,448 14,202 3,184 6,772 208,882 56,949 192,698 41,040 193,211 51,635 1,711,895 359,308 1,760,234 422,383 Hogs 24,846 167,668 34,462 101,822 66,338 37,658 Sheep 36,947 97,819 10,537 82,010 61,742 10,949 432,794 300,004 356,588 313,161 323,475 274,869 3,659,294 3,065,774 2,860,385 3,136,918 Cold Storage Holdings After allowing for usual seasonal changes, United States cold storage stocks of most principal commodities continued to decline through October. Holdings of beef, however, showed about the usual seasonal increase and stocks of lard and cheese considerably less than the usual decrease. November 1 holdings of beef were 32, pork 16, miscellaneous meats 13, lard 2, shell eggs 18, and cheese 3 per cent below the average for that date during the past five years. 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 ...... Nov.1 Oct.1 Nov.1 Aver. 1939 1939 1938 '34-'38 (In thousands of units) 49,246 36,917 41,218 72,788 272,678 300,226 251,645 323,681 3,498 2,965 2,606 3,191 79,282 63,164 77,692 77,088 57,578 59,392 50,268 66,011 68,136 78,794 67,667 69,623 3,528 5,430 3,244 4,293 2,980 3,471 2,694 2,782 128,147 154,594 195,263 126,108 114,746 116,561 132,326 118,732 Flour Milling Operations at southwestern flour mills dropped from an average of 89 per cent of capacity in September to 78 in October and 69 in the first half of November. Currently, production and sales are greatly limited by the heavy buying and the urgency of shipping directions early in September. A good part of the September business covered buyers' needs up to January 1, and sales have again declined to the rather low level that prevailed prior to the outbreak of war. Export trade is slow. October flour output was about 5 per cent above the average of the past ten years and 4 per cent above output in the same month a year ago, while production for the year to date is 3 per cent larger than last year. Flour prices are slightly higher with wheat. Flour output reported by the Northwestern Miller: Oct.1939 Kansas City.................... . Salina............................... . Wichita............................. Other cities ..................... . 672,000 236,000 193,000 1,234,000 Change from Sept.1939 Oct. 1938 ( In barrels) -105,000 +14,080 +16,000 +5,000 -14,000 +19,000 -213,000 +36,000 Southwest........................ 2,335,000 -327,000 +85,000 United States*................ 6,382,000 -948,000 -67,000 *Represents about 64 per cent of output in United States. Petroleum Daily average crude oil production in the District increased further during October and is now back to within 5 per cent of the level of output prior to the shutdown of wells last August. October production was little changed from that of a year ago and was slightly above average, while output for the first ten months of the year is 6 per cent less than last year. Oil production reported by the American Petroleum Institute and the Bureau of Mines: Oct. 1939 Sept. 1939 Oct. 1938 Gross D. Av. Gross D. Av. Gross D. Av. ----( In thousands of barrels) 4.0 3.7 127 4.2 125 115 5,056 168.5 4,835 156.0 5,211 168.1 99.8 3,034 101.1 3,093 3,501 112.9 13,053 421.1 12,586 419.5 14,066 453.7 63.8 1,921 64.1 1,649 53.2 1,978 -- Colo.................. Kans................ N. Mex............. Okla................. Wyo................. 5 States........... u. s.................. 23,858 769.6 22,724 757.4 23,768 766.7 111,444 3,595.0 108,168 3,605.6 101,830 3,284.8 Following a sharp decline when wells were closed last August, stocks of crude petroleum produced in this District eased further in October. Stocks are about 20 per cent under a year ago. War demand has strengthened the price of lubricants and petroleum wax but gasoline prices generally are weak. Coal Bituminous coal production in the District showed a further seasonal increase during October. Output for October was 17 and for the first ten months of the year about 5 per cent larger than last year. Coal output estimated from reports of the National Bituminous Coal Commission: Colorado.......................... . Kansas and Missouri ..... . New Mexico ..................... Oklahoma......................... Wyoming......................... . 707,000 642,000 117,000 226,000 .594,000 Change from Sep~1939 Oc~1938 (In tons) +185,000 +166,000 +10_9,000 +1~2,000 +19,000 .-13,000 +44,000 +-48,000 . . +4.4,000 : . ±~~.ooo Six states......................... 2,286,000 45,255,000 +404,000 .. +339,000 +7,105,000 +10,266,000 Oc~1939 United States.................. 7 FEDERAL RESERVE BANK OF KANSAS CITY Zinc and Lead Zinc and lead shipments from the Tri-State district increased sharply during October, the zinc shipment rising 24 and that of lead 16 per cent above the movement in October last year. October shipments from the Tri-State district: ZINC ORE Tons Value 1,556 $ 100,446 390 25,148 2,966 191,448 Oct. 1939........................ 39,934 $ 1,757,155 Sept. 1939...................... 32,725 1,274,188 Oct. 1938........................ 32,198 952,469 10 Mos.1939 .................. 330,006 10,706,437 10 Mos. 1938.................. 308,674 8,527,773 4,912 $ 317,042 3,667 229,366 4,229 239,130 48,767 2,731,877 42,324 2,153,894 Ore stocks have declined sharply in recent weeks, stocks of zinc now amounting to considerably less than a week's output at the current rate of production. Several mines have reopened and production, which is at the highest level in nearly two years, is increasing rapidly. Zinc and lead prices are steady. Employment and Pay Rolls Industrial employment and pay rolls in the District rose considerably further from the middle of September to the middle of October. Employment is now about 5 and pay rolls 8 per cent higher than a year ago. Preliminary figures of the Department of Labor: October 1939 per cent change from September 1939 Employment Pay Rolls Colorado...................................................... + 10.9 + 11.7 Kansas ....................................................... .' +1.4 +1.8 Missouri...................................................... +2.4 +5.0 Nebraska..... ............................................... +6.1 +4.8 New Mexico................................................ -0.1 +9.9 Oklahoma.................................................... +0.7 +0.6 Wyoming.................................................... +6.8 +14.2 Seven states............................................... +3.6 Value of construction awards in the Kansas City area (Nebraska, Kansas, Oklahoma, and western half of Missouri) in October was 5 per cent less than a year ago as compared with an increase of 4 per cent for the year to date. The October decrease reflected principally sharply smaller awards for nonresidential building. Awards for the first half of November remained 6 per cent below a year ago. Construction figures of F. W. Dodge Corporation: Residential building.......... . Nonresidential building.... . Public works construction. Utility construction ........... . Oct. Oct. ~ 1939 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 ............... .. 87 46 42 68 988 92 22 39 196 262 197 211 98 19 13 10 80 155 363 ESTIMATED COST 1938 $ 71 56 756 88 19 38 142 203 182 169 78 11 13 22 69 211 330 October............................ 2,942 2,504 September....................... 2,634 2,481 Ten months ..................... 23,047 20,625 10 Mos. 10 Mos. 1939 1938 ( In thousands of dollars) 3,332 3,092 33,699 27,032 3,032 5,389 31,402 34,867 1,444 1,593 21,907 27,115 2,558 836 18,777 12,265 Kansas City area................ 10,366 10,910 105,785 101,279 37 Eastern states ................ 261,796 357,698 2,896,598 2,505,810 1939 159,000 $ 99,000 72,000 869~00 52,000 32,000 28,000 252,000 647,000 367,000 381,000 83,000 36,000 11,000 3,000 93,000 402,000 25~000 1938 166,000 115,000 54,000 697~00 53,000 101,000 103,000 266,000 164,000 368,000 158,000 76,000 19,000 7,000 16,000 147,000 441,000 428~00 $ 3,842,000 $ 3,379,000 4,115,000 40,719,000 3,650,000 29,383,000 Lumber Board feet sales of lumber at reporting retail yards in the District in October, for the fifth consecutive month, were under a year ago. The October decrease was nearly 10 per cent, but total sales so far in 1939 are little different from 1938 because of large increases in early months this year. Lumber stocks showed little change during October and are about 5 per cent under a year ago. Collections in October averaged 34.6 per cent as compared with 34.0 per cent in the same month of 1938. Lumber trade at 152 retail yards in the District: +5.1 Building ~ PERMITS LEAD ORE Tons Value 11,312 $ 497,743 2,920 128,480 25,702 1,130,932 Kansas........................... Missouri......................... Oklahoma...................... The value of October building permits issued in reporting District cities was about 14 per cent above that for the corresponding month a year ago. Value of permits for the first ten months of the year shows an increase of 39 per cent over last year. October building permits in District cities: Sales of lumber, board feet........................ Sales of all materials, dollars.................... Stocks of lumber, board feet...................... Outstandings, dollars.................................. Oct.1939 per cent change from Sep~1939 Oc~1938 +12.1 -9.5 + 11.1 +2.9 -0.1 -4.6 +2.5 -1.9 Life Insurance October life insurance sales in the District were about 7 and sales for the first ten months of the year 4 per cent larger than in the same periods last year. The Life Insurance Sales Research Bureau report: Colorado ..................................... . Kansas ........................................ Missouri. .................................... . Nebraska................................... . New Mexico ............................... . Oklahoma.................................. . Wyoming................................... . Seven states............................... United States............................. Change from Oct.1939 Sept. 1939 Oct.1938 (In thousands of dollars) 4,980 + 365 + 732 6,610 +1,023 +684 16,474 +2,007 +1,583 5,093 +277 +448 1,139 +340 -112 7,618 + 857 - 685 1,128 +241 +59 43,042 543,991 +5,110 +101,394 +2,709 +55,035 8 REVIEW OF AGRICULTURAL AND BUSINESS CONDITIONS NATIONAL SUMMARY OF BUSINESS CONDITIONS By the Board of Governors of the Federal Reserve System M,~IJFACTURING PRODUCTION l'0IIITS IN TOT.11. 1'100( l40 POIHTI IN TOTAL UICEX - 140 60 1 - - -- - l - - - Rapid expansion of industrial output continued in October, and employment and pay rolls increased considerably. Distribution of commodities to consumers, which had increased in September, was maintained at the higher level in October. In the first half of November industrial activity increased further but, with production in many industries approaching capacity, the advance was less rapid than in earlier months. Commodity prices generally showed little change during October and the first half of November, following the sharp rise in September. 60 ~ - - + -- -~ PRODUCTION ~ ~ t - -- - - + - o ~ _ _.____ _.____ _.____ _.____ _,____ __, o 1934 1935 1936 1937 1938 1S39 Index of physical volume of production, adjusted for seasonal variation, 1923-1925 average =100. Durable and n ondurabl e series expressed in t erms of points in the total index. By mouths , ,J anuary, 1934, throu gh October, 1939. WHOLESALE PRICES PERCENT PERCENT -- 110 100 100 90 80 70 110 ~ ,-. - - -I ~ 90 ~ 80 -..F 70 60 60 50 50 1934 1935 1936 1937 1938 1939 Index compiled by the United States Bureau of Labor Statistics, 1926=100. By w eeks, 1934 through w eek ending November 11, 1939. Volume of industrial production showed a further sharp rise in October and the Board's seasonally adjusted index advanced from 111 to 120 per cent of the 1923-1925 average. Marked increases in activity were reported in the steel and steel-consuming industries and at mines. In the steel industry ingot production in October was at a rate of 90 per cent of capacity and actual volume of output was the greatest for any month on record. Some further increase in the rate of output was reported in the first half of November. Pig iron production also advanced sharply and lake shipments of iron ore, which had increased considerably in September, continued in exceptionally large volume. Activity in the machinery and shipbuilding industries and in most other steel-consuming lines rose in October but by a considerably smaller amount than output of steel. In the automobile industry, however, output showed less than the marked rise usual at this season. This was due to the fact that plants of one large producer were closed during most of the month by an industrial dispute. Mineral production in October was at record levels owing chiefly to a high rate of crude petroleum output. · In the nondurable goods industries activity was generally maintained at the high levels reached in August and September. Flour production declined sharply, however, following an exceptionally large volume of output in September. Value of construction contracts, as reported by the F. W. Dodge Corporation, decreased considerably in October, reflecting principally a reduction in awards for public construction. Private residential contracts continued in substantial volume while awards for commercial and industrial building declined somewhat following increases in the previous month. EMPLOYMENT MON~Y RATES IN NEW YORK CrfY 3 Reports from leading industrial states indicate that factory employment and pay rolls increased sharply between the middle of September and the middle of October. Increases were particularly large at steel mills and in related industries. There was also a considerable increase in employment on the railroads in October. DISTRIBUTION 2 0 0 1934 1935 1936 1937 1938 1939 For weeks ending January 6, 1934, through November 11, 1939. MEMBER BANKS IN 101 LEADING CITIES 111.UlNS OF DOU.AIIS BILLIONS OF 00l.LAA5 12 12 10 8 Retail distribution of general merchandise in October showed about the usual seasonal rise from the advanced September level. In the early part of November department store sales increased considerably. Freight carloadings rose further from September to October, reflecting a large increase in shipments of miscellaneous freight, which includes most manufactured products, and smaller increases in loadings of coal, forest products, and ore. COMMODITY PRICES Price changes that have occurred sine~ the general sharp rise in September have reflected largely particular developments in individual commodities. From the middle of October to the middle of November prices of a number of foodstuffs continued to decline and there were also decreases in some industrial materials, such as print cloths, wool, tin, and steel scrap. Wheat, cotton, and burlap advanced somewhat while prices of most other commodities, including finished industrial products, showed little change. GOVERNMENT SECURITY PRICES 6 4 4 2 Following a sharp recovery from the low of September 21, prices of United States Government bonds showed irregular changes during the period from October 24 through the first half of November. On November 15 yields on long-term Treasury bonds were at 2.47 per cent as compared with 2.79 per cent on September 21. BANK CREDIT 0 •34 1935 1936 1937 1938 1939 Wednesday figures for reporting member banks in 101 leading cities, S eptember 5, 1934, through November 8, 1939. Commercial loans, which include industrial and agricultural loans, represent prior to May 19, 1937, so-called "Other loans" as then reported, Total loans and investments at reporting member banks in 101 leading cities increased substantially during the six weeks ending November 8, reflecting largely purchases of Treasury bills by New York City banks. Commercial loans continued to show moderate increases. Deposits at these banks rose to new high levels.
@FedFRASER