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MONTHLY BUSINESS REVIEW
o f the

FEDERAL RESERVE BAN K o f Dallas

~=====================================~~===========
D a11 as, T exas, A·l
Thi s copy is relensed for pubvoIume 26, No.2
pC! 1, 1941
Jication in afternoon paperB- Mar. 31

'r

~~=~~===========================================================================================

DISTRICT SUMMARY
The demand for merchandise at wholesale and retail trade
establishments in the Eleventh District remained at a high
level in February. On a seasonally adjusted basis, department
s~ore sales were at an all-time peak for that month, and the
distribution of commodities through wholesale channels exceeded that of a year ago by 14 per cent. In the industrial
field, the value of construction contracts awarded was at a
~uch higher rate than a month earlier or a year ago, due to
Increased awards for publicly-financed projects. Daily average
~troleum output was the largest since May, 1940, and crude
011 runs to refinery stills rose further to a new high level. The
outlook for agriculture and livestock in this district is generally satisfactory, but warm, sunshiny weather is needed over
a large portion of the district to stimulate the growth of
P1a~ltS and range vegetation and to permit farmers to proceed
rapidly with plowing and seeding operations.
BUSINESS
The expansion in purchasing power, resulting from increased
Payrolls and higher farm income, is being reflected in co~su,?er
Purchases at retail establishments in the Eleventh Dlstnct.
During the first two months of 1941, the sale of merchandise
at representative firms operating in seventeen lines of retail
t~ade other than department stores averaged about 16 per cent
higher than in that period of 1940. Department store sales at
repOrting firms have likewise shown a pronounced gain over
fhose of a year ago. In February, daily average sales increased
ess than the average seasonal amount but were 14 per cent
greater than in the corresponding month last year. This bank's
seasonally adjusted index of department store sales stood at
118 per cent of the 1923-1925 average in February as against
126 per cent in January, and 107 per cent in February, 1940.
~uring the first two months of the current year, the distribution of merchandise through reporting department stores was
~t ~he highest level of record for that period. Weekly reports
Mdlcate that department store trade during the first half of
. arch was about the same ·as in that period of 1940, which is
Significant in view of the fact that sales in March last year
Were augmented considerably by the early date of Easter.
b Stocks of merchandise at department stores were increased
about the average seasonal amount in February, and at the
c Ose of the month their dollar vah,le closely approximated that
of a year ago. On a seasonally adj\lsted basis, inventories have
shown little change since last October, their value fluctuating
around 71 per cent of the 1923-1925 average.

r

averaged 15 per cent higher than in that period a year earlier.
The value of merchandise stocks at wholesale establishments
showed an average increase of 3 per cent during February, and
at the month-end the total was 7 per cent higher than a year
earlier.
Employment and payrolls in Texas, as reported by the
Bureau of Business Research of the University of Texas, showed
moderate advances in February, reflecting chiefly increases at
wholesale and retail trade establishments and at plants manufacturing food, textile and forest products. As compared with
February, 1940, employment was 4 per cent higher and payrolls were up 8 per cent.
The number of business failures in the Eleventh District
among manufacturing, trade, construction and commercial
service establishments declined from 41 in January to 33 in
February. On the other hand, the average liability of defaulting
firms increased considerably, with the result that their aggregate indebtedness rose 50 per cent to $415,000, which was
more than double that in February, 1940.
AGRICULTURE
Weather conditions have had varying effects upon agricultural and livestock conditions in the Eleventh District during
recent weeks. Rains and snow during the latter part of February and early in March temporarily relieved a deficiency in
surface moisture in eastern New Mexico and in the Texas
Panhandle and afforded some relief from dust storms, which
had caused considerable damage to wheat in local areas. On the
other hand, moisture supplies in central and east Texas and
northern Louisiana continued excessive and wet fields caused
further delays in soil preparation and seeding of crops, particularly corn. Early in March field work in those areas ranged
from one to four weeks behind schedule. During the second
week of March high winds dried out the topsoil in many areas
of Texas, permitting a resumption of planting and plowing
operations. In the vegetable growing area of south Texas persistent rains, high winds and frosts during February caused
additional damage to truck crops and delayed further the
harvesting and shipment of vegetables. Planting of spring
vegetable crops throughout most of the commercial producing
areas of Texas is also later than usual. According to the Department of Agriculture, unfavorable weather during the past
winter reduced considerably the production of some truck
CASH

FARM

INCOME

El.£VENTH . rEOERAI. RaERVE DISTRICT

hiSal~s at reporting wholesale firms in eight lines of trade in
~ s district showed wide variations from January to February
~e chiefly to seasonal factors, but the aggregate dollar value
o . sales evidenced little change over the month. In comparison
;Ith the corresponding month of 1940, sales in only two lines,
1rUgs and tobacco, failed to participate in the average gain of
h4 per cent. A greater distribution of durable goods, including
j.rdware, surgical equipment, automotive and electrical suples, and machinery and equipment, was chiefly responsible
O{ the large gain over the same month last year, although
S\es at wholesale grocery firms were up 8 per cent. Cumulative
Sa es at all reporting firms during the first two months of 1941

f

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2

MONTHLY BUSINESS REVIEW

crops, but supplies of winter vegetables were for the most part
adequate to meet market demands, and prices received for
products have been fairly satisfactory.
The Texas wheat crop made fairly good growth during February and the first half of March, although the crop in some
areas was damaged by high winds and dust storms. Rains and
snows in the heavy producing sections of the State early in
March were beneficial, but additional surface moisture is needed
as a considerable acreage of wheat, which is of short, thin
growth, is susceptible to further wind damage. The Texas oat
crop has shown relatively little growth due to the lack of sunshine, but thus far there has been comparatively little damage
from freezes and insects.
Livestock ranges in this district showed a noticeable improvement during February, and their condition on March 1, as
reported by the United States Department of Agriculture, was
the highest for that date in recent years. Although continued
rains and cool weather in the eastern half of the district have
delayed the growth of new grass and damaged old feed, prospects are generally favorable for early spring grazing. In the
western portion of the district range grass and weeds made
good growth during February. Grazing on small grain fields
has been limited thus far due to the slow growth of crops and
to wet fields. Livestock weights increased during February in
virtually all sections except in those areas where excessive rainfall caused further damage to range feed. Losses of animals
during the past winter were light because of the generally mild,
open weather. Current prospects are good for large spring calf
and lamb crops. The demand for cattle has been strong, but
trading on the whole has been light. Although the development
of early spring lambs in Texas has been slow due to unfavorable weather, animals are expected to mend rapidly with the
appearance of clear, sunshiny weather.
Production of wool in the Eleventh District rose to a new
all-time peak of 103,000,000 pounds during 1940, reflecting
chiefly an increase of about 5 per cent in the number of sheep
shorn in Texas. In that State, the 10,300,000 head of sheep
clipped accounted for a total wool output of 80,350,000
pounds. The increase in the production of wool during 1940
was accompanied by an exceptionally heavy demand for and
WHOLESALE AND RETAIL TRADE STATISTICS
~-----.Porcontngo ohange in:
,
Number ~
Net sal~tocks-----,
of
Feb., 1941 from
Jan. 1 to
Feb. 28, 1041 from
reJ:lOIIlIlrting Feb.,
Jnn.,
Feb. 28, IMI Fob 20., Jan. 31,
Retail trade:
fir
1940
1041
from 1040
1940
IOU
Department stores:
Total 11th Dist ., ..
45
+10
- 2
+12
- 1
+ 8
Dallas . . ..... ... ...
7
+6
+1
+8
+3
+8
Fort Worth ....... .
4.
+ 2
- 12
+18
- 2
+ 3
Houston .......... .
6
+16
- 6
+14
- 18
+10
San Antonio . . . .... .
5
+12
+ 3
+16
+ 6
+ 2
Shreveport ... .... .
3
+15
+ 1
+14
Other cities .. .. ... .
20
+13
+ t
+13
Independont stores:'
Arilona. . . . . . . . . . . 245
+0
-4
+10
New Mexico........ 179
+5
-3
+0
Oklahoma .. .. .. . .. 562
+11
- 3
+16
Texas.... . .. .. .... 1,025
+12
- 4
+16
Wholesale trndo:'
Machinery, eqpt. &:
supplies..... .. .. ..
4.
+10
+ 7
+31
Automotive supplies.
7
+12
-17
+ii
Drugs (incl. liquors) .
8
- 3
- 10
-5
Elootrionl supplies.. .
4.
+63
+ 9
Grooeries.. . .. .. .. ...
32
+8
- t
Hardwaro. . .. . . .. . .
14
+24
- 10
Surgical equipmont..
4.
+14
+11
Tobaoco &: produots.
5
No ehg.
+17
- 1
'Compilod by United States Bureau of Census. tChango 1088 than ono-half of ono per cent.
INDEXES OF DEPARTMENT STORE BALES AND STOCKS
(1928-1925 averago~I00)
February
Jnnuary
Decembor February
1941
1041
1040
1040
Sales (daily average):
Without S0880Dal adjustment . .... .. .
101
96
201
91
With Be880nal adjustment . . ... ... ... ,.
118
126
107
116
Stocks (end of month):
Without s0880nal adjustmont .... ... .
68
62
68
68'
72·
71
71
71
With ceasonal adjustment ... ..... '" ".
• Revised

I

an increase in the farm price of that product. As a result, cash
income of wool producers in this district from the sale of that
product rose $6,000,000 to a total of $29,100,000. In Texas,
cash income from wool marketings amounted to $23,300,00 0,
which was only fractionally below the all-time peak reo
corded in 1937. Production of shorn wool in the United States
was likewise at an all-time high during the past year, totaling
387,800,000 pounds. Marketing of this wool resulted in a cash
income of $110,000,000 to farmers and ranchmen.
Mohair production in this district rose sharply to a record of
20,000,000 pounds, which was 14 per cent greater than in
1939. Producers' cash income during 1940 from the sale of
mohair totaled $10,100,000 as against $8,500,000 in 1939. The
growth of mohair in this district represented 95 per cent of

total production in the United States.
The aggregate income of farmers during 1940 in the five
states included in this district, which amounted to $1,012.000,000, was slightly lower than in the preceding year, reflecting the smaller Gov~rnment benefit payments to farmers
for participation in the program of the Agricultural Adjustme!1t Administration. However, Government benefit payments, which amounted to $143,000,000 during 1940, were
higher than in any year prior to 1939. Income from the sale of
farm products, including crops, livestock and livestock products, was 2 per cent greater than in 1939. Moreover, the decline in total receipts, including Government payments, waS
occasioned by a substantial contraction in income in Louisiana,
where unfavorable weather conditions during 1940 cau~ed
severe damage to cash crops. In Texas, Oklahoma, New MeXICO
and Arizona the increase in income from the sale of farm products more than offset the decline in benefit payments recei~ed
from the Federal Government, with the result that total Income in those states averaged 2 per cent higher than in the
preceding year.
Among the principal divisions of farm income, receipts from
the sale of crops amounted to $460,000,000 during 1940,
which was 6 per cent higher than the revised estimate of
$434,000,000 received in 1939. Although cotton continues to
dominate the trend in cash income from the sale of crops,
farmers in this district have made some progress in the diversification of agricultural production in recent years. The acreage
diverted from cotton production has been utilized largely ad
pasturage for livestock and to increase production of fee
and vegetable crops. The growing importance of truck crops
as a revenue producing source is indicated by the fact that
1940 cash income from this source rose to an all-time peak °d
$44,000,000, which was $6,000,000 greater than in 1939 an
$2,000,000 above the previous maximum established in 1931,
Cash income from the sale of grain crops, including co rnl
wheat, oats, barley, rice and grain sorghums, totaled $98,000,000 as against $94,000,000 in 1939.

IIi

The livestock industry in this district continued as a maj?r
source of revenue during 1940, though a moderate decline )!I
cash income occurred as compared with the preceding year.
The contraction is accounted for by a reduction in the market!
ings of cattle and calves due apparently to the restocking. o
ranges following heavy sales in 1939. Reports indicate that Ink
come from the sale of sheep and wool was at an all-time peak
during the past year. Total income from the sale of lives toC
and livestock products during 1940 amounted to $410,000,000, which represents a decline of $5,000,000 from the preceding year.
FINANCE
Member bank reserves maintained at the 'Federal Reser;e
Bank of Dallas, which had increased considerably during t e

I
1)

8
MONTHLY BUSINESS REVIEW
first six weeks of 1941, and reached a record of $2 57,000,000 products and brick and tile, it appears that operating schedules
on February 14, showed little net change during the subsequent w,ere mainta!ned in January ~nd Fe?ruary at a level sharply
thirty days and daily average reserve balances during the first higher than m the correspondmg penod a year earlier. Produchalf of March were $33,200,000 greater than in that period of
CONDITION STATISTICS OF MEMBER BANKS IN LEADING CITIES
(In thoUBands of dollars)
1940. Required reserves increased further between February
Maroh 12, Maroh 13,
Feb. 12,
1941
1940
1041
IS and March 15, but the gain was apparently small and daily
loans and invcstments. . . . . . . . . . . . . . . . . . . . . . . 5591,360
$532,227
$580,238
average excess reserves continued near the peak of $95,300,000 Total
Total loan.. . . .. ... .. .. .. .. . . . .... ... .. ...... ... .
320,800
270,566
321,677
recorded during the first half of February. Balances of member
Commeroial, industrial and agrieulturallo.ns. . . . . .
220,946
179,521
222,975
Open market paper .......... . . ............... . ·
1,650
1,812
1,413
banks in this district carried with other domestic commercial
Loans to brokers and dealers in seuurities. . . . . . . . . .
3,854
3,642
4,676
Othor lonns for purohasing or carrying seourities....
11,895
13,303
12,186
banks also reached a new high level in February. The average
Real estate loans . .. .. ............... · .. ...... .. ·
28,471
22,234
22,500
during the first half of the month amounted to $527,000,000,
Loans to banks ..... .. . . .. . . ... .. .. .. . . . .. .. . .. .
640
235
686
All other loans ... ,. . . ... .. . . . .. .. . .. . . .. ... ... ..
57,844
40,819
57,232
which was $30,000,000 above that in the corresponding period United States Government direct obligations. ... .. ... 169,004
152,901
166,872
Obligations fully guaranteed by United States Govt..
40,385
51,036
38,855
of 1940.
Other securities. ...................... ............
61,671
57,724
61,884

Federal Reserve notes of this bank in actual circulation,
which had shown a counter-to-seasonal gain during the latter
part of January, fluctuated around $97,000,000 during most
of February and then turned upward again toward the end of
the month, reaching an all-time high of $100,900,000 on
March 4. Although a moderate decline has occurred since the
latter date, Federal Reserve note circulation on March 15 was
about the same as the 1940 peak established in December and
$18,600,000 greater than a year ago. An increasing volume of
currency shipments to army camps to meet contractors' payr?lls and salary payments to soldiers and a greater demand for
Circulating currency to accommodate the expanding volume
Of. business and industrial activity are the principal factors con~1'lbuting to the high level of Federal Reserve note circulation
In this district.
loans at weekly reporting member banks in this district on
March 12 totaled $320,300,000, which was only $1,377,000
lower than the 1941 peak reached four weeks earlier, and was
nearly $50,000,000 greater than a year ago. Moreover, total
loans were still higher than at any time during 1940. Although
the generally active use of bank credit that has persisted thus
far in 1941 may be accounted for in part by the greater deilland for funds by business and industrial concerns to carry
arger inventories of non-defense goods, it is probable that a
~ubs.tantial portion of the net expansion in loans represents bor?Wl11gs to finance the purchase of materials and the production of goods incident to the National Defense Program. InVestments at reporting banks showed a further expansion of
$3,.500,000 during the four-week period ended March 12, due
to l11creases in holdings of direct and guaranteed obligations of
the United States Government. Total loans and investments
at these banks on March 12 were $59,000,000 greater than a
y.e~r earlier. Deposits at reporting banks continued to expand,
riSing $19,200,000 during the four-week period.
Debits to individual accounts at banks in eighteen cities of
~ he Eleventh District, which reflect in some degree the trend
In employment and in business and industrial activity, were 13
~er cent higher in February this year than in the correspondtng month of 1940. During the first two months of 1941,
c~arges to depositors' accounts were the highest of record for
~ at period, exceeding the previous maximum established in
929 by about 5 per cent.

INDUSTRY
BUilding activity in the Eleventh District and operations at
~roce~sing and manufacturing establishments in allied inUStl'les, including lumber, cement, structural iron and steel,
ar:d brick and tile, have been well sustained since the begin:?g of 1941. Production and shipments of cement at Texas
thills .during the first two months of the current yea~ were at
I e highest level of record for that period. On the basIs of emp 0Yment at establishments producing structural iron and steel

Reservcs with Federal Reserve Bank. . . . .. . .. .. .. ..
161,057
Balances with domestic banks. ..... . .. .. ... ..•. ....
307,409
Demand deposits-adjust.ed·. . . .. .... .. ..... . .. ...
556,706
Time dejloslts .... . .. ,. ..... .. . . . .... ... .. .... .. . .
137,900
United States Government deposits.. ......... ......
22,420
Interbank deposit. .. ..... .... ........... .. ··· · ····
29Y26
Borrowings from Federal Reserve Bauk... . .........
None
'Includes all demand deposita other than interb.nk and United
cash itema reported as on bend or in the prOClCM of eoUeotion.

140,532
159,837
301,021
201,896
483,687
542,989
136,593
136,957
31,117
22,787
272.484
289,715
None
None
States Government leBS
'

CONDITION OF 'fHE FEDERAL RESERVE BANK
(In thou.ands of dollars)
March 15, March 15,
1941
1940
$3l1!~06
$249,959
Total cosh reserves . ....... . .. . ....... ..... ...... .
None
131
Disoounts for member b.nks ......... . ............ .
None
60
Other bills disoounted .... . . .. ............• . ...... .
277
481
Iudustrial advanoes ... .. .............. .. . ........ .
86,834
94,362
United States Government securities ........ .... .•..
87,112
95,034
Total carning assets . .. .......................... .
255,056
219,002
Member bank reserve deposits .................... .
98,705
80,064
Federal reserve notes in aotu.1 circulation .......... .

Feb. 15,
1941
$311,696
None
None
278
86,834
87, 112
256,005
97,225

DEBITS TO INDIVIDUAL ACCOUNTS
(In thouaand. of doUars)
February
February Petg.ehauge January
1941
1040
over year
1941
Abilene. . . .. .. .. .. . .. .. . $ 12,224
S 8,068
+52
$ 11,552
Austin..................
34,088
31,392
+ 9
38,416
Beaumont.............. .
27,193
28,242
+17
27,136
Corsicaaa.. .. .. .. .. .. .. .
3.373
3.357
+ t
4,310
Dallas. . . .. . . . . .. .••. . ..
266,539
246,780
+ 8
304,498
EI Paso. . . . . . . . . . . • . . . . .
46,800
29,231
+60
49,584
Fort Worth..............
83,361
71,651
+16
100,418
Galveston. . . . .. .•. . . .....
24,449
30,075
- 19
26,790
Houston.................
260,147
227,069
+15
280,528
Port Arthur.............
10,188
9,175
+11
10,919
Roswell. ................
4,577
3,053
+16
4,855
S.n Antonio.............
78,347
66,023
+19
84,657
Shreveport . . . ...... . ... .
45,716
42,964
+ 6
53,227
Texarkana..... .. ..... .. .
8,406
6,813
+23
10,002
'fueson............... .. .
13,887
11,368
+ 18
14,360
Tyler . .... .. .. ......... .
ll,439
11,081
+ 3
14,438
Waoo...................
14,606
14,424
+ 1
15,896
Wichita Falls........... .
15,508
16,420
- 6
17,650

Petg.ehango
ovor month
+ 6
- 11
+ t
-22
- 12
- 6
-17
- 9
- 7
- 7
- 6
- 7
-14
-16
- 7
-21
- 8
- 12

Total... ........ $060,348
$853,086
+13
$1,069,181
-10
.Inoludes figures of two banks in Texarkan., Arknnaas, loo.ted in the Eighth District.
tChange less than one-half of one per cont.
GROSS DEMAND AND TIME DEPOSITS OF MEMBER BANKS
(Average of daily figures-in thoUBands of doUars)
Combined total
Reserve city banks
Country banks

February,
February,
October,
November,
Deoember,
January,
February,

Gross
demand
1939 . ..... , . . . $1,193,160
1940 ......... . 1,355,474
1940 .......... 1,408,515
1040 . ......... 1,460,895
1940 .... . .... · 1,474,217
1041 ....... . . , 1,495,852
1941 . . . . .. . ... 1,533,864

Beaumont ..... . . ....•. · .
Dallas ........ · ·· .. · .. · .
EI Paso ... .. .. · ·. · .... ..
Fort Worth ..............
G.lv ..ten .......... ·· · ..
Houston ........... · .....
Port Arthur . ......... ...
San Antonio .............
Shreveport .. ............
Waco .......... · .... · .. ·
Wiohita Falls ............
All othors . ..............
Total . • . _ •. _ ...

Time
$225,328
234,306
233,323
283,412
287,808
289,594
241,491

Gross
demand
$674,977
785,130
814,555
842,576
841,903
856,284
876,181

Gross
demand
$518,183
570,344
598,960
627,319
632,314
639,618
657,683

Time
$124,975
129,055
128,295
128,213
131,622
138,190
134,266

Time
$100,353
105,251
105,028
105,199
105,686
106,395
107,285

SAVINGS DEPOSITS
Percentage ehan,e in
February 28, 1941
aavings deposita rom
r
Amount
of
~
Number
of
Number of
Jan.31,
Feb. 29,
s.vings
aavings
re~orting
1941
1940
deposits
depositors
anks
.7
4,251,192
+
7.6
10,283
S
3
26,671,914 + 1. 3
91,542
+ .01
8
.8
.4
8,343,080
19,544
+
2
13,128,532 + .2
35,143
+ .2
3
.3
.7
12,130,624
+
18,825
4
32,418,263 + 4.2
77,926
+ .4
10
3,265,804 + 2.8
5,992
+ .9
2
.7
18,064,659 + .9
28,281
6
+
2.2
12,309,593
+ .8
25,331
3
.6
4,510,332 - 2.9
8,129
3
.4
3,655,702 - 1.2
7,ll3
3
.3
+
1.5
30,828,145
62,542
69

-

+

-

+

115

385,601

$169,572,840

+ 1.6

+

~1

4

MONTHLY BUSINESS REVIEW

tion and shipments of lumber at pine mills in this district,
which had increased sharply in January following the usual
year-end decline, showed a moderate recession during February, but continued at a much higher level than a year ago.
The value of construction contracts awarded in this district,
which had shown a substantial decline in January from the
record total reported in December, 1940, advanced 14 per cent
in February and the total exceeded that of a year ago by about
43 per cent. On a daily average basis the value of contracts
awarded in February was one-third higher than in the preceding month and nearly 50 per cent greater than in February,
1940. The expansion in the rate of awards over both the preceding month and the corresponding month a year earlier extended to each of the principal classes of building, with the
most pronounced gain occurring in awards for public utilities
construction. During the initial two months of the current
year the aggregate value of construction contracts awarded in
this district was 39 per cent greater than in that period of
1940.
The marked expansion in building activity during the past
year, with the consequent increase in demand for labor and
building materials, has been accompanied by a rise in building
costs. Wage rates have increased and prices of building materials, particularly lumber, have shown noticeable advances.
According to data compiled by the Federal Home Loan Bank
Board, construction costs in 25 key cities of the United States
for a standard residence rose from 106 per cent of the 1936
average in July, 1940, to 112.5 per cent in December.
Daily average crude oil production in the United States,
which had followed a moderate downward trend during the
preceding four months, increased 3 per cent in Februal'y due
chiefly to a substantial gain in output in Texas. In the Eleventh
District, daily average production rose 6 per cent in February
to the highest level since last May. However, in comparison
with the corresponding month a year earlier, when the heavy
production of crude oil was causing substantial additions to
above-ground stocks, the February daily average output in this
district was 3 per cent smaller and production in the United
States was down 2 per cent. Crude oil inventories showed only
moderate increases in February this year.
Refinery operations in this district increased further to a
newall-time peak in February, and crude oil runs to stills in
the nation as a whole were only fractionally below the peak established in June, 1940. Production of gasoline in the United
States since the turn of the year has exceeded distribution by
a wide margin. Inventories have shown an average gain of
1,500,000 barrels weekly and on March 1 they were only 2 per
cent below the volume on hand a year earlier.
Following a substantial decline in January, preliminary reports indicate that the rate of drilling activity in the Eleventh
District showed a pronounced increase in February, reflecting
chiefly increased operations in north and east Texas. In contrast with the sharp gain in this district the rate of drilling activity in the United States was only moderately higher than a
month earlier. In comparison with February last year, the daily
average number of wells completed in both this district and the
nation was slightly smaller.
The rate of operations at cotton textile mills in the United
States increased by more than the average seasonal amount
from January to February, and the Board of Governors' adjusted index of cotton consumption, which had declined in
January, rose 4 points to 142 per cent of the 1935-1939 av-

erage, which compares with the peak level of 145 per cent attained in December, 1940. The volume of cotton consumed
during the month totaled 794,000 bales, which was the highest
of record for that month and 20 per cent greater than in February, 1940. During the first seven months of the current season, domestic consumption of cotton totaled 5,221,000 bales,
which was at a rate of about 9,000,000 bales annually. Such a
figure, if realized this season, would be the highest of record,
exceeding the previous maximum established in the 1936 -19 37
season by about 1,000,000 bales. Although purchases of cotton
textiles from processing establishments during much of February were on a smaller scale than in January, the heavy buying that developed in the last week of the month apparently
brought total mill sales well above the month's output. During
the first week of March, the commercial demand for textiles
continued heavy and the Government entered the market for
a substantial volume of goods for defense purposes. Prices of
cotton goods have continued to show some advances. Purchases
of raw cotton by consuming establishments during Februa:Yl
exceeded by a small margin the amount consumed, and mil
stocks at the end of the" month were 12 per cent higher than
a year earlier. Between the middle of February and the middle
of March the average price of cotton, middling, 15/16-inch
staple, at ten spot markets rose 68 points to the season's high
of 10.68 cents per pound. According to trade reports, the recent strength in the raw cotton market was apparently due to
the heavy demand from domestic consuming establishmentS,
the scarcity of "free" cotton in trade channels, and the uncertainty with respect to probable changes in the farm program. Repossession of cotton in the Government loan is pr~­
ceeding at a fairly substantial rate. The Commodity Cred~t
Corporation reported that on February 28 there were apprOXImately 11,026,000 bales of cotton in Government loan stocks,
consisting of 6,183,000 bales owned outright by the Corporation and 4,843,000 bales held as collateral for loans.
Exports of cotton from the United States remained in smaIl
volume during February, totaling only 60,600 bales, which
brought total shipments for the first seven months of the current season to 724,700 bales. The latter figure compares with
exports totaling 4,917,000 bales in the corresponding period of
the preceding season.
VALUE OF CONSTRUCTION CONTRACTS AWARDED
(In thousands of dollars)
February
February
January January 1 to February 28
1041
1040
1941
1040
1041
Eleventh Distrietr-total.. . S 23,731
$ 16,603
$ 20,768
$ 44,490
$ 31,°84
Residential. . . ....... . .
7,666
6,616
8,448
16,013
10,9
28,486
20,060
All other. . . . . . . . . . . .. .
16,166
0,088
12,320
United States·-total.... .
270,373
200,fi74
306,205
676,678
300,~~~
Residential. .. . ........
116,460
74,868
111,306
227,766
162'607
All other . . . ... . . .. ....
153,014
126,716
103,800
347,813
244,
·37 states east of the Rooky Mountains,
SOURCE: F. W. Dodge Corporation.

1

BUILDING PERMITS
Pereentage
Percentage ehange
valuation From Jan. 1 te Feb. 28, 1041 chan"C
--. valuation
Valuation " Feb.,1940 Jan., 104 1 No.
Valuation From 1040
+43
$ 55,763
- 26
+113
88 $ 130,613
+37
197,525
122
371 ,485
+ 43
+14
_6
760, 188
404
1,1 61,346
+00
+ 3
+ 91
88,453
-7 1
231
395,763
- 31
_ 2
1,456,068
2,658,422
448
+21
+ 4
+1
071,657
- 7
1,324
- 14
2,020,248
+ 64
286,782
287
608,814
+28
+66
360,660
- 30
- 20
443
851,641
:':5~
96,706
- 13
207,825
- 37
287
_ 40
1,116,640
-44
3,1 20,715
- 20
834
+26
106,428
204
100,844
+ 22
+26
+68
370,362
- 12
-65
1,060
1,402,447
+0
298,365
023,206
-8
238
+ 7
+35
161,666
-8
316,651
135
+ 86
+6
81,120
139,245
+ 89
+40
66

February, 1041
Abilene ........
Amarillo .......
Au,tin ...... ...
Beaumont .... . .
Corrru8 Ohristi. .
D.I .. • ...... . .
EI Paso .... ....
Fort Worth ... ..
G.lve8ton . ... . .
Heuston . .. .....
Port Arthur . ...
San Antonio ....
Shreveport .....
W.co ..........
Wichita Falls . . .

No.
43
58
197
119
216
667
160
216
149
406
92
560
112
65
34

------

-

Total. . . . 3,074 $6,405,142
6
- 17
·Includes Highland Park and University Park.

6,171 $14,159,254

-_1

MONTHLY BUSINESS REVIEW
April 1, 1941

NATIONAL SUMMARY OF BUSINESS CONDITIONS
(Compiled by the Board of Governors of the Federal Reserve System)

....

0

..... -

INDUSTRIAL PRODUCTION

100

Tarj-IV J

60

tJ IV

\

./

40

-----::~

~

URA Bl.E
MANVFAfuRE8

20

I00
eo
eo

NONDURAOI..£

MA~~9.-1~

40

~~INERAL8

20

I
19315

o
1936

1937

1938

1939

1940

1941

~ederal Reserve index of physical volume of produc·

adjusred for season. I variation, 1935-39 average
;=tlon,
.100. Subnroups sbown are expressed in rerms of
Olnts in the tOtn! index by months, January, 1935
to

February, 1941.

WHOLESALE PRICES OF BASIC COMMODITIES

~§?HIm~
180

160

~---+----4---~160

120

100 rv""''-F'''''~-l----\l,-=w~~I-='+---IIOO
60· '--_-l..___-==:::::...-:~.L
193~

1 9 ~6

1937

1938

____L

__...L__....J 60

1939

1940

1941

~urffeau of Labor Statisti cs' indexes based on 12 foodu s and 16 industrial ma teri als, August, 1939
100. T bursday figures, Jaouary 3, 1935 to
Marcb 13, 1941.

"'<t.,

=

MONEY RATES IN NEW YORK CITY

•

Industrial 2ctivity and employment increased further in February 2nd the nrst half of Much .
Buying by producers and consumers continued in 12rge volume and wholesale commodity prices, particularly of imports, adv2nced.

I20

/

60

I6 0

I40

140
120

-

no ...
4

PRODUCTION
In February volume of industrial output, on a daily average basis, rose more than seasonally, 2nd
the Board's adjusted index advanced from 139 to 141 per cent of the 1935-39 average.
Increases in February, as in other recent months, were lugest in the durable goods industries where
2 la rge proportion of defense program orders have been placed. Activity continued to rise sharply at
machinery plants, aircraft factories, shipyards, and in the railroad eq uipment industries. Steel pr<>duction fluctuated around 96 per cent of capacity in January and February and rose to 99 per cent in
the first half of March. New orders for steel continued large and, despite the high rate of output, unfilled orders increased further. Many orders have been placed for delivery in the second half of this
year, reflecting the prospect of heavy consumption and some uncertainty on the part of steel users regarding future availability of supplies. Output of pig iron, coke, and nonferrous metals W2S likewise
2t near capacity rates in February 2nd unfilled orders for these products, too, were at exceptionally high
levels. Demand for lumber continued large owing to a high rate of construction activity and output
was sustained in large volume for this time of year. Automobile production increased in February and
the first half of March to 2bout the peak rate 2tt2ined last November. Retail sales of new 2nd used
cars 2dvanced to unusually high level •.
In industries manufacturing nondurable goods, activity continued at the record levels reached in
the latter part of 1940. There were further increases in the cotton textile, rubber, and chemical industries and activity at woolen mills also increased, following a temporary reduction in January. In
most other lines activity was m2intained at the high levels of other recent months .
Coal production rose less than seasonally in February but increased considerably in the nrst half
of March when, according to trade reports, there was some inventory accumulation in anticipation of
2 possible shutdown on April 1 at the expiration of the present contract between the mine oper2tors
and the miners' union. Copper and zinc production increased in February and recently domestic supplies of copper have begun to be supplemented -by imports from South America. Output of crude petroleum continued at about the rate that had prevailed during the three preceding months.
Value of con.truction contract aW2rds in February declined somewhat more than se2sonally, reflecting decreases in both public and private work, according to reports of the F. W. Dodge Corpontion. Awards for public construction, although sharply reduced from the high levels reached in the
btter half of 1940, were somewhat above those of a year ago, and awards for private construction
were nearly half ag2in 2S large 2S in February of 12St yeu.
DISTRIBUTION
Distribution of commodities to consumers increased more than seasonally from January to Febru2ry. Sales at v2riety stores and by mail-order houses were the largest on record, making allowance for
usual seasonal changes, and department store sales were also 2t a high level.

~~~~~__~~~~~~~~~--J O

1930

li38

1'137

1938

1939

1940

~eeklY averages of' daily yields of 3-

'84 1

5-year tax12empt Treasury notes, Treasury bonds callable after
to

lr years, and average discount on new issues of

eaSUry bills offered within week. For weeks ending
January 5, 1935 to March 15, 1941.

~.,DCII.Uu

MEMBER BANKS IN 101 LEADING CrrtES

Freight-car 102dings increased by about the usual seasonal 2mount. Shipments of miscellaneous
freight, consisting mOiStly of manufactured products, showed an incre2Sc while 102dings of fore&t
products rose less th2n seasonally 2nd grain shipments declined.
WHOLESALE COMMODITY PRICES
Prices of 2 number of basic imports rose sharply from the early part of February to the middle of
March. Cotton yarns and gr2Y goods and nonferrous metal scup showed further increases in this period 2nd there were also advances in prices of some other domestic commodities, including lead,
wheat, cotton, and oils and fats.

12 r - + - - l----+--l----I--"'04---l12

BANK CREDIT
Commerci21 1020s continued to increase 2t member banks in 101 leading cities in February and the
first half of M2rch and these banks also purchased 2ddition21 Treasury notes 2nd bills issued in connection with the defense program. As a result: of the increase in loans and investments, bank deposits
showed a further ffi2rked advance.
UNITED S1"A TES GOVERNMENT' SECURITY PRICES

r

I

LOANS TO DROKERS
1 AND O!A1.ERS

O~~__-L__Jt~~==~~~~o

~

11315

ISse

IlI1IT

1038

183S

1940

1941

194dnesday figures, Januaty 2, 1935 to March 121
agrl- Conunercialloans, whIch include industrial ana
eu Itural loans, represent prior to May 19, 1937
so-called "Ower loans" as then reported.

Prices of Government securities increased after Fcbru2CY 15, following a sh2rp decline in the preceding ten weeks. The 1960-65 bonds on March 15 were about 3l1i points above their price on Februuy 15 and 2bout 1 \4 points below the 211-time pe2k of December 10. The yield on this issue, which
incrc2Sed from 2.03 per cent 2t the pe2k in prices on December 10 to 2.30 per cent on February 1S,
had declined to 2.14 per cent on March 11.

MONTHLY BUSINESS REVIEW

CASH FARM INCOME
(In thousands 01 dollars)
~---Texas - - - " . - E l e v e n t h DistriotO ______
1940
1939
1938
1940
1939
1938
Cotton .... ............. . $139,828 $128,137 Sl31,017 S 213,463 $ 199,943 $204,822
Cottonseed ... . ......... .
21,894
16,347
21,604
32,358
26,831
32,787
41,692
36,616
38,836
97,735
All grainst .............. .
94,273
94,530
Corn ....... .. ... ... .• .
4,026
4,158
4,654
7,640
8,560
8,133
16,309
18,411
51,436
52,508
53,643
17,775
Wheat ....... ........ .
23,772
21,353
53,189
46,649
42,840
All vogelablest .......... .
30,375
Irish potatoes ........ . .
1,584
1,569
1,286
3,591
3,945
3,654
Truok crops ..... ... . . .
26,378
20,519
17,985
44,329
37,693
33,606
13,436
11,561
24,244
22,869
20,417
13,765
Fruits and nuts ... . ..... .
23 1,546
237,468
459,926
434,372 438,101
Total income Irom all orops 262,653
233,160
217,075
409,040
414,540 388,730
Livestook§ .............. . 230,050
110,755
68,814
142,667
170,189 113,245
Government income pmts .
86,489
TotaICarm income ... . $579,192 $575,461 $523,357 $1,012,233 $1,019,101 $940,076
'Eleventh District figures represent combined totals for the five states wholly or partially
included in the Eleventh District. tlneludes corn, wheat, oats, barley, rioe and grain sorghums.
Uneludes Irish and sweet potatoes and truck crops. §Ineludes receipts from the salc 01 livestock and livestook produots.

LIVESTOCK RECEIPT8-(Numbor)
,.----Fort W o r t h - v - - - San Antonio--...
Fobruary February January February February January
1941
1940
1941
1941
1940
1941
30,530
39,521
12,918
11,679
15,726
CattI................... . 26,309
18,445
24,952
15,662
11,993
26 1721
Calves .. .............. .. 16,415
37,937
67,438
13,877
10,081
15,993
Hogs ............. ... ... . 48,359
29,604
26,223
5,831
6,317
6,908
Sheep ................. .. 18,740

COMPARATIVE TOP LIVESTOCK PRICES
(Dollars pcr hundredweight)
,.----Fort W o r t h - v - - - San Antonio--...
Fehruary February January February February January
1941
1940
1941
1941
1940
1941
$ 9.25
$11.50
$11.75
$ 7.50
$12.00
Be.1 .teers ............. .. $11.50
11.25
9.00
11.50
Stooker sleers .. ... ..... . .
.iiJ:iJiJ
10 .00
11.50
12.00
9.00
11.50
Beifer. and yearlings .... .
7.50
6.50
7.25
6.85
6.00
Butcher cows ....•. .... • .
7.00
9.75
10.50
8.50
10.00
8.25
Calves .............•....
10.50
8.25
5.50
8.10
5.50
8.45
7.85
Bog.................... .
9.50
7.50
8.50
Lambs ................. .
10.50
8.75
9.75
RECEIPTS, EXPORTS, AND STOCKS OF COTTON AT THE PORTS OF
HOUSTON AND GALVESTON-(Bales)
February
1941
100,143
Receipts ............... . .
74,749
Exports ................ .
Stooks, end of monlh .... . 1,961,039

February
1940
330,887
396,519
1,495,844

January
1941
96,141
85,679
1,967,962

August 1 to February 28
This seMon Last season
1,580,651
3,308,441
2,815,191
686,770

STATISTICS ON COTTONSEED AND COTTONSEED PRODUCTS
~---Texas--v---United Stales---August 1 to February 28
August 1 to February 28
This season
Last season
This season
Last scason
Cottonseed received at mills
1,039,582
888,778
4,139,744
3,885,59 1
(tons) ... . . ...... ... ...... .
3,485,370
916,548
865,924
3,335,075
Cottonseed orushed (tons) .. . . .
Cottonseed on h.nd Feb. 28
520,847
72,922
(tons) ..... ... ............ .
843,511
138,781
Production of products:
250,461,341 1,064,803,291 1,095,635,500
Crude oil (pounds) ........ . 278,404,249
1,569,864
426,360
412,504
1,480,764
Cake .nd meal (tons) ...... .
879,842
233,967
223,701
839,100
Hull. (tons) ...... . .. . ... ..
885,354
200,282
895,119
225,325
Linters (running bales) ..... .
Stooks on hand February 28:
79,652,434
89,221,337
25,102,170
Crude oil (pounds) . . .. . ... . 30,098,388
200,275
74,405
252,947
Cake Bnd meal (ton.) .. .. . . .
61,369
104,787
211,243
43,884
96,890
Hulls (tons) .............. .
324,665
Linters (running bales) ..... .
75,458
271,837
96,829
SOURCE: Bureau of Census.
CONSUMPTION, STOCKS, AND EXPORTS OF (;OTTON-(Bales)
August 1 to February 28
January
February
February
Thi. season Last senson
1941
1940
1941
Consumption .t:
82,453
20,373
129,923
19,368
11,451
Texas mills . ...........
4,703,707
5,220,917
793,626
661,771
843,274
Uni ted States mills .....
U.S. stooks-ond of month:
1,874,611
In consuming cstab·mts. 1,905,413
1,700,394
Publie stg. &: compresses . 14,038,917 12,176,733 14,668,189
Ex~orts from U. S. to:
1,525,928
nited Kingdom ... . ...
12,920
192,631
18,218
339.988
617,904
France .......... ......
130,230
None
None
None
385,132
None
Italy ...... ......... ...
None
74,404
None
18,992
Germany ..............
None
None
None
None
017,832
Other Europe . . ... . . ...
8,435
102,307
5,305
164.042
675, 180
49,456
9,986
01,990
0.754
775,543
171,243
29,256
155,118
18,907

i~Forho; ·e~~;;I~iCs·.·.::::
Total exports . .... ...

60,597

746,080

52,184

724,729

-

4,916,511

CRUDE OIL PRODUCTION-(Barrela)
February, 1941
Increase or decrease in dailY

average produotion from~

Total
produotion
4,830,000
North Tex .................. .
West Texas ............. . ... .
7,446,800
East Tcxas ...... .. ... .. .... . 12,539,350
5,688,050
South Texas ....... . ........ .
7,113,700
Texas Co.slal. ......... .... ..

Dailyavg.
production
172,500
205,957
447,834
203,144
254,061

Fob., 1940
- 2,524
1,110
-46,978
- 16,725
+22,506

37,617,900
2,861,950
1,949,550

1,343,496
102,213
60,627

-42,611
- 8,654
+ 1,008

Total Texa •... . .. .
New Mexico .. .. . ...... ..... . .
North Louisian.............. .

+

Total District... .. . 42,420,400
1,515,336
-50,257
SOURCE: Estimated from American Potroleum Institute weekly reperts.

J.n., 1941
+ 1,434
+27,304
+17,861
+17,497
+18,256

-

+82,352
+ 1,378
+
669

+84,399