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M{)NGJrHL<](
REVIEW
FED ERA L
RES E R V E
Vol. 37, No. 4
BANK
DALLAS, TEXAS
o
F
DALLAS
April I, 1952
LIVESTOCK-THE KEY TO A BALANCED SOUTHWESTERN AGRICULTURE
H. MOORE, Agricultural Economist
Federal Reserve Bank of Dallas
CARL
"Balanced farming" has become a popular term among
agricultural leaders in all parts of the Nation. The term is
used to describe a system of farming that rebuilds soil fertility
and provides the maximum income from each farm. In its
broadest meaning, it implies a combination of crop and livestock enterprises that provides the farm operator with some
cash income in most months of the year, as well as a relatively
high and stable annual income.
absorb rainfall more rapidly and facilitating proper and
adequate cultivation. A history of every agricultural area
in the world shows that eventually crop rotations that include
legumes and grasses or heavy applications of organic matter,
such as manure, must be a part of the farm program if yields
are to be maintained. In the Southwest the need for such soilimproving crops is most urgent, in view of the depleted and
eroded condition of the soil in many areas.
The development of a balanced farming program either for
an iJldividual farm or for the agriculture of an area requires
consideration of the soil capabilities and limitations, possible
crop rotations, seasonal distribution of labor requirements,
the full utilization of available labor and equipment, special
skills of the farm operator, and needs of the farm family.
Proper balance of these and other factors will provide a
reasonably satisfactory farm income pattern.
Price relationships in recent years have made the all-out
production of cash crops most profitable for many southwestern farmers, despite declining yields. As a result, farmers
have not hesitated to capitalize on the situation by planting
too large a proportion of their cropland to such crops. It is
also true that cash crops, such as cotton, wheat, and rice, may
continue to return more per acre and per hour of labor than
the production of forage or feed crops, assuming that average
or above-average yields can be maintained. As indicated,
however, continued profitable yields of these cash crops can
be achieved only through the use of crop rotations that include some forage crops, such as legumes and grasses.
Southwestern agriculture has been criticized by many as
being " out of balance." A major part of the cropland is
planted each year in casb crops. For instance, in 1951, about
65 percent of cultivated cropland in Texas was planted in
cotton, wheat, peanuts, and rice. An additional 20 percent
was planted to sorghum grains, much of which was sold as a
cash crop. The acreage devoted to the production of forage
crops, such as legumes and grasses, not only is insufficient
to give proper balance between soil-depletin g and soil-building crops but does not provide adequate roughage for the
area's livestock potential.
Sllch a lack of balance in the " agricultural plant" results
cOllsiderable seasonal unemplo yment in agriculture. More·
over, experience has shown that such a system of farming
results in steadily declining yields of cash crops. Soil fertility
and a desirable soil sLructure cannot be maintained without
the growing of deep-rooLed fibrous crops, such as legumes
alld grasses. These crops loosen L soil, permitting it to
he
As forage or feed crops become an essential part of the
farm program, livestock become a necessity in order to utilize
the forage produced. It is true that such crops can be harvested in the form of hay or permitted Lo develop seed and
can be sold to supplement other cash income. However, nearly
every year-and certainly in the long rUll--{;llsh receipts
from the sale of seed and hay crops from grasses and legumes
will not be as high as the value obtainable from their use in
the production of livestock and livestock products.
j II
Actual farm records and experimental data have shown
that, in general, livestock will return from $1.50 to $2.50 for
every dollar's worth of feed fed-in fact, in some cases the
return has been even more favorable. In other words, using
livestock to utilize the hay and pasture crops will, in general,
This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)
MONTHLY BUSINESS REVIEW
50
increase cash receipts 50 to 150 percent over the amount that
would be received from the sale of these crops as cash crops.
This is illustrated by data obtained during 1947 and 1948 at
the Texas Technological farm at Lubbo ck, which show that
grazing irri gated alfalfa pasture mixtures (largely alfalfa and
perennial rye grass) with beef cattle returned an average of
$117 net per acre, compared with $75 net income from the
sale of hay from similar fields. To this additional income ob·
tained by marketing the crop through livestoGk should be
added the value of the manure left on the land by the cattle.
The increased income that can be obtained through live·
stock production is due, to a considerable extent, to the regular, year-round character of the work. Care of livestock
provides productive employment for the farmer throughout
the year, in contrast to the labor requirements on cash.crop
farms, which provide very little productive "'ork even for the
farmer himself during the winter months but necessitate the
hiring of additional labor during spring and fall seasons. In
many respects, the farm that provides profitable employment
only 6 months each year can be compared to the factory that
shuts down 6 months each year. Neither is likely to be
profitable.
The soundness of additional livestock production in the
Southwest also is emphasized by the fact that the area imports
substantial quantities of livestock products to meet the demand of local markets. The rapid industrialization and
growth of urban populations, particularly in Texas and
Louisiana, have provided a substantial market for all classes
of agricultural products. In recent years it has been necessary
to import whole milk and rather large quantities of grain-fed
beef and poultry to supply the markets of the Southwest. Increased production of these foods by southwestern farmers
not only would be profitable but would provide a better
halance to the agriculture and to the entire economy of the
area.
COTTON ' MAN-HOURS REQUIRED PER ACRE
."
The shift toward more livestock and the profitableness of
livestock production on many farms are retarded by the lack
of skills and "know how" in managing livestock, the lack of
experience with animals, insufficient fences or buildings, and,
in many cases, inadequate operating capital or credit. Overcoming these obstacles is a community problem, as well as an
individual problem of each farmer, especially in areas shifting from a one·crop agriculture to livestock or a combination
of cash crops and livestock. Businessmen have a stake in this
problem because the income of farmers living in their trade
areas influences their sales volume. Bankers should be conce rned because the credit needs of a rural community change
as the type of agricultural production changes, and the income
level of the people directly affects deposits. The income pattern of the community will change substantially as farmers
shift from cash crops to livestock or a combination of the two.
Merchants may find a change in the seasonal buying habits
of the area, as well as a change in the kinds of goods needed.
Customs of the community, such as the usual landlord-tenant
agreement, will need adjustment to fit the requirements of a
livestock or a combination livestock and crop program.
DAIRY COWS : MAN-HOURS REQUIRED PER COW
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Considerable progress has been made during the past
decade toward a better balance of agricultural production in
the Southwest through the addition of livestock on many
farms. As late as 1940, more than one· fourth of all farms and
ranches in Texas reported no income from the sale of livestock or poultry. Preliminary data for the 1950 Census of
Agriculture show virtually every farm and ranch receiving
some income from the sale of livestock or livestock products.
Moreover, the acreage of legumes has increased from virtually
none to well over 4,000,000 acres. Cattle have become an
important part of the program on many central and east
Texas farms that formerly produced only cotton or peanuts.
It seems evident that this trend will continue and that in the
decade ahead livestock will become a much more important
phase of southwestern agriculture.
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MONTHLY BUSINESS REVIEW
Among the problems inberited by a community sbifting to
more livestock production, the credit problem ranks near the
top in importance. Lack of credit may retard desirable
changes. But, of equal importance, credit extended unwisely
may cause financial losses to both borrower and lender and
may discourage the development of a balanced agriculture.
Whether credit is extended by banks, merchants, individuals,
or government agencies, certain basic problems must be
considered.
The credit requirements of a livestock farmer are quite
different from those of a cash.crop farmer. The latter usually
requires credit only for a season, and, in most years, borrowed capital can be repaid within a period of about 9 or 10
months. On the other hand, the production of livestock is of
such a nature that from 3 months to 3 years may be required
to repay a loan. Moreover, the establishment of a breeding
herd of dairy or beef cattle may require some credit for a
period of several years. Financing the building of a breeding
herd should be predicated upon a sound, periodic repayment
program that will assure the earliest liquidation of the loan
consistent with a sound livestock program.
I n some respects, livestock loans contain a smaller element
of risk than those for the production of cash crops, because
the livestock can scrve as realizable collateral at the time the
loan is made, whereas this is not equally true in the case of a
cash crop until it is harvested. Also, in the case of livestock
there is less risk from unfavorable weather; there is greater
stability of income from year to year; and, within limits,
there are alternative sales opportunities.
Livestock production is exacting in its demands upon farmers; its requirements in many respects are much different
from those commonly associated with crop production. The
fanner who plans to add livestock to his farm program must
be adaptable to the requirements of this agricultural pursuit.
Agricultural leaders, bankers, and others interested in promoting "balance in agriculture" through increased livestock
production should recognize that in addition to the fundamentals of livestock production, considerations sllch as the
following are extremely important:
• Does the farmer who contemplates broadening his farm
program to include livestock have knowledge of or experience
with livestock? If not, extreme caution should be exercised
until he becomes familiar with the problems of handling livestock and exhibits a keen interest in their care.
• Can a feed production program be developed on the
farm tbat will support the contemplated livestock operation?
It is much wiser, first, to build a feed-producing program
to meet the needs of livestock than to start a livestock enterprise and hope to develop a feed-producing program to meet
its needs.
51
• Is there a working arrangement between the landlord
and tenant which will give the tenant reasonable assurance
that he will be able to remain on the farm long enough to
develop the planned program? A farm er who faces the possibility of moving to another farm every year or two canuot
hope to build a profitable livestock program.
• Is the farm family interested in livestock, or will they
be reluctant to forego week-end trips and other pleasures in
order to give timely attention to livestock? Such diversions
are not impossible when a livestock program is being carried
out, but there will be times when they can be done only to
the detriment of the entire program.
Fundamentals of Livestock Production
Adequate feed, improved breeding, and proper care are the
cornerstones of a profitable livestock program. Sufficient
quantities of the right kinds of feed are necessary to obtain
maximum production. Even scrub cattle do better when fed
properly_ Yet, tlle best feed will not give high production if
the animals do not have the inherent ability to produce-hence, the need for improved breeding. Moreover, the best
animals, provided with the best feeds, will not be profitable
without adequate care; this would seem obvious, and yet poor
management is a major weakness in many livestock programs.
Animals must be given proper care and attention if the benefits of good breeding and feeding are to be obtained.
Building a livestock program is somewhat like building a
house. It requires careful planning of each step and a vision
of the completed structure to insure success. Plans for a livestock program should include the kinds and amounts of feed
to be produced on the farm or purchased; the kinds and
numbers of livestock that will be kept and the level of productivity that will be set as a goal in the breeding program; and
the buildings and equipment, skills, and knowledge of markets
that will be required for managing the program.
Just as the architect designs a house to be used for many
years, a livestock program should be designed as a long-term
pro j eet, for the investment in animals and the rearranging of
the farm plan to include Jivestock cannot be shifted easily
from year to year without danger of financial loss. It is true,
of course, that adjustments can and should be made to fit
changing conditions, just as the architect and build'e r may
make minor changes in a house pJan as construction proceeds.
But in both cases, the over-all plan cannot be changed materially without destroying much of the usefulness of the
original design.
A livestock program must be developed with caution, especially by the inexperienced. In an effort to bolster farm income some farmers may be tempted to increase their livestock
program beyond their ability to care for the animals or to
provide adequate feed. The farmer with little experience in
52
MONTHLY BUSINESS REVIEW
livestock production or with little capital should begin on a
small scale. Much of the knowledge and many of the skills
that are required for the profitable operation of a livestock
program are best gained through experience. Many of today's
most successful dairymen, ranchers, swine producers, and
poultrymen have spent years building tbeir present livestock
programs.
and kinds of livestock to be produced. Purchase of some
grains and high·protein supplements is usually advisable, but
the major portion of the feed requirements-especially hay ,
silage, and pasture-should be produced on the farm. Frequently, it is also possible to grow th e grains and at least a
part of the high-protein fccds needed for the livestock
program.
An Adequate Feed Supply
Pastures provide the most economical feed for cattle, sheep,
and goats; reducc matcrially grain req uirements of hogs; and
arc a valuable supplement to the grain ration for pouItry.
Thu s, bu ilding more productive pastures should be the first
step in developin g an adequate, eco nomical, home-grown feed
supply. The production and storing of silage also arc of paramount importance in the Southwest, because silage is the
most economical feed for carrying cattle through periods of
drought or adverse weather when rasturage is not available.
The steps necessa ry in developing productive pastures vary
from farm to farm, but most farmers could increase the productive capacity of their pastures by giving proper attention
to soil and water conservation, the seeding of adapted grasses
and legumes, fertilization, and controlled grazing. A Rusk
County, Texas, farmer red uced feed costs $100 and increased
milk sales 3250 the first 3 weeks his dairy herd was turned
onto temporary Sudan grass pasture. A Gulf Coast dairyman
carried out a pasture improvement program and reduced the
daily feed cost from 73 cents to 23 cents per cow.
Assuring an adequate feed supply is the first step in building a profitable livestock program. Livestock are merely
processors of feeds, converting pasturage, hay, and other
feedstufTs into milk, meat, eggs, and wool. Efficient and profitable operation of this "manufacturing" process is no more
feasible without sufficient quantities of raw materials (feeds)
than is the operation of the steel mill without coal and iron
ore. Just as the manufacturer makes certain of a reliable
source of raw materials before building a factory, farmers
sho uld make arrangements for producing adequate supplies
of feed before buying livestock.
Feeding ample amounts of the right kinds of feed, rather
than attempting to "reduce" costs by "skimping" on feed, is
the way to profits in livestock production. This is illustrated
by results of tests at agricultural experiment stations which
show that 428 pounds of feed were required to produce 100
pounds of pork when pigs were fed only half the recommended ration and only 391 pounds were required when they
were fed the full amount. Furthermore, the pigs fed the
full ration reached market weight in 106 days, while the lot
fed a limited ration required 224 days. Thus, labor and miscellaneous costs were more than doubled, in addition to the
increased cost of 37 pounds of feed for each 100 pounds of
pork produced.
It is obvious that attempts to reduce costs by feeding cheap,
poor quality feed are false economy. Moreover, feeding unbalanced rations even of good quality feed is uneconomic. In
agricultural experiment studies, the addition of grain to the
ration of dairy cows that had been receiving only high quality
legumc hay increased milk production as much as 50 percent
to 75 percent. In hog feeding trials, supplementing a ration
of corn alone with tankage-a high protein feed- red'uced
the amount of corn required for 100 pounds of gain by nearly
50 percent. Many other illustrations could he ci ted to show
the dollar value of providing the proper amounts of the right
kind of feed for livestock and poultry.
Many farmers have found livestock unprofitable, largely
because they have bought most or all of the feed needed for
their animals. One of the most frequent criticisms directed
toward southwestern dair ymen is that they have attempted
to maintain their dairy herds from feed bags rather than -£rom
pasture, hay, and silage produced on the farm.
The amount and types of feed that can be produced on the
farm should be used as a guide in determining the number
Improved Breeding
Animals differ greatly in their ability to produce. In a
carload of feeder lambs from the same ranch, certain individual lambs will gain faster and produce a more desirable carcass than others. In a dairy herd there are always some cows
that produce more than others, even though they are fed
alike.
The objective of a good breeding program is to select
animals with the iul,erent ability for high production. These
animals then can be used as foundation stock for increasing
the herd . Farmers can improvc greatly the production from
thei r animals merel y by saving stock from the best adults
fnr replacements. Thi s process of improving the quality of the
animals and the lcvel of production frequently is facilitated
by the purchase of one or two outstanding females and particIIlarl y by the use of outstanding sires. That this program of
breeding will improve the productivity of the herd' is supported by the experiencc of leading livestock producers
throughout the country.
Experiments have shown that milk production can be in·
creased as much as 90 percen t in three generations solely by
the use of an outstanding bull. Use of progeny-tested rams at
the Texas A. & M. College Substation at Sonora has shown
that the average weight of fleece can be increased and the
conforma tion of the lambs greatly improved in one genera-
MONTHLY BUSINESS REVIEW
tion through selective breeding. Many other illustrations
could be cited to show the value of using only rugh.prod'ucing
females and outstanding sires as foundation stock for the
breeding program. The perfecti on of the technique of arti·
ficial insemination is placing the use of outstanding dairy
bulls within the reach of more and more dairymen, and it is
entirely possible that the technique may be used with other
classes of livestock in the future.
Many farmers are unduly concerned over the selection of
a particular breed of livestock or the relative merits of pure·
bred versus grade animals. The selection of the breed is
largely a matter of personal choice, since there are greater
differences between animals within a breed than there are
between two breeds. It usually is an advantage to have the
breed that is most common in the community. This facilitates
the exchange of bulls and sale of surplus breeding stock. It
is not important to have purebred animals, unless the farmer
intends to develop a highly specialized breeding herd with
the idea of selling most of his calves as breeding stock. How·
ever, it always is important to select healtby, vigorous animals
rrom prod'uctive stock.
Proper Core and Monagement
The cattleman wh o fi ghts the blizzard to feed hi s cattle,
th e shecpherder who camps with his flock durin g lambin g,
the dairyman who provides dry quarters for hi s dairy cows
for protection from sharp drops in temperatures, and the
poultryman who provides dry, comfortable quarters for his
birds are good businessmen, for they know that without this
extra effort on their part, the animals will not produce at
maximum capacity.
The importance of regularity in feeding and caring for
livestock is illustrated by the fact that failure to milk dairy
cows regularly will cause a decline in production of milk not
only for that day but for several additional days or weeks.
Leaving dairy cows exposed to cold, wet weather, especially
the sharp drops in temperature caused by "northers," may
cut the milk Row in half. Failure to feed the poultry flock
regularl y may cause the birds to molt and reduce egg produc·
53
tion for several weeks. Providing shade and a "hog wallow"
for fattening pigs increases the rate of gain and saves on feed
costs. Sheep that are permitted to become infested with parasites, such as ticks and worms, will not make efficient use of
feed.
Careful handling of livestock products increases their sales
value. For example, eggs gathered within an hour or two
after layin g and promptly cool ed to 60 degrees will remain
fresh several days longer than those left in a hot laying house
- where the temperature may exceed 100 degrees in the
summer-until the end of the day. Milk that has been can·
taminated with dirt or that has been improperly cooled frequently is rejected by the milk plant. Fleeces that are dirty
or full of burs are discounted heavily by the wool buyer.
Efficient management involves more than giving livestock
proper care. It also means studying markets and prices. It
means planning a breeding program to provide maximum
production when prices are likely to be highest and producing the kind and quality of product that will be in strongest
demand and will bring a premium price. For example, prices
of eggs are usually highest during September, October, November, and December. Therefore, the efficient poultryman
will buy chicks early enough in the spring and feed' them so
that they will be in production by September, thus getting the
advantage of the higher egg price. Prices of whole milk also
are highest during the fall and winter months, and good dairy
management requires the planning of the breeding program
so that milk production will be highest during this period.
Southwestern farmers have made rapid progress in the ap·
plication of scientific method's to their farming operations,
and the tremendous strides in mechanization and in insect
and disease control stand out as maj or accomplishments in
improving the agriculture of the area. The same farmers also
will find it profitabl e to apply scientific methods to their livestock programs. Farming is trul y becoming a science, as well
as an art, and profits in livestock production will be in proportion to the amount of scientific knowledge that is applied
to the livestock program.
54
MONTHLY BUSINESS REVIEW
REVIEW OF BUSINESS, INDUSTRIAL, AGRICULTURAL, AND FINANCIAL CONDITIONS
Nonfarm employment in the Distri ct
in March was II p from the previous
rronth and nea r the level of last November- the secon d highest month on reco rd
- bllt still helow the December peak. Unemployment, althou gh still relatively small , is ri si ng, largely as a result of the
red uced labor requirements on farm s and ran ches in the
drought-stri cken areas o f Texas.
Crude oil production in the District is at a record hi gh
level, while re finer y activity continues above a year a go. A
heavy demand for burning oils has drawn down stocks in the
Di strict and in the Nation; stocks of gasoline are ri sing seasonall y. Drilling activity is at a level above a year ago. Constru ction contract awards in the Di stri ct in February were
up 10 percent from Ja nuary but 45 percent below a year
earlier.
Rains in February and March greatly improved the im mediate outlook for crop production in the eastern half of
th e Di strict in 1952. hut most of the remainder of the District continues dr y. Progress of the di stri ct winter wheat crop
is spotty; the crop in northwest Texas still needs moisture_
Plantin g of cotton , corn , and sorghum grain is well advanced
in southern parts of T exas and is moving northward_ Comme rcial vegetables in March recovered from the February
freeze, and open weath er permitted additional plantin g of
spring crops, althou gh soils are dry and irri gation water,
short. Livestock are gaining rapidl y in eastern parts of the
Di strict, where recenl rain s have brought improved grazin g;
suppl emental feedin g co nti n ues in man y western parts of the
District. Farm commodity pri ces continue to move down ward, although cotton an d so me grains were stron ger in late
March.
Although department store sales in the Di stri ct rose moderately in late February and the first half of March, the ri se
was less than usual for this time of the year. Tn fact, sales
in most weeks of the first quarter were below sales in correspon din g weeks of 1951. Charge account collection s con·
tinue slow in relati on to receivables. Merchants have succeeded largely in correctin g the excessi,-e inventory position
which developed last year; orders outstandin g are off sharpl y
f rom a year ago. F urn iture store sales are maintaining a
bri sk pace_ while automobile sales are laggin g substanti all y
behind earl y ] 951.
Durin g the 4 weeks ended March] 9, the principal changes
in the con dition of the weekly reportin g member banks in
the Distri ct included a reduction in invesbnen ts and increases
in cash assets and deposit •. Loans decl ined fractionall y_
Sales or redemptions of Treasury hills more than accounted
for the decrease in investments, while the in crease in cash
assets was reflected in the expansion of balan ces with banks
and reserves with the Federal Reserve Bank. Deposits of individuals_ partnerships, and corporation s rose by somewhat
less than 2 percent duri ng IJ,e 4 weeks.
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Although de parlment store sales in the
Elevent h Federal Reserve Di strict rose
moderately i n late February and the first
"",,,,aJ.tSIN£S,S ••. ~
half of March_ the upturn was a little
less than usual for thi s tim e of yea r. Moreover. sales for the
month of February, after adjustment for normal seasonal
differences, failed to maintain the improved volume of the
prev ions 3 month s and dropped back to the lower level prevailing in the summer and fall of last year_ The dollar volume
of February sales was 6 percent lowe r than in January but 2
percent higher than in the correspondin g montll last year.
Th e decrease in sales from January was partially the result
of olle less tradin g day in February. whi le the in crease over
a year previou s ma y have been du e 10 the one additional
tradin g day in February thi s year.
~
Comparisons of sales wi th rear-earlier level s in the first
3 months of this year are of lil~ited value because of the different dates of Easter in the 2 years, the war-scare buying in
carll' 1951, and two sleet storms whi ch partially affected trade
at Ihe beginning and middle of February a year ago. Weekly
yea r-to-year compa ri sons show wide fluctuations, although
usuall y on the " decline" si de for this year. Nevertheless,
cumulati" e sales for the first 2 month s were only 2 percent
lo\\cr than in Ih e sa me pe riod of 1951. This not unfavorable
pidllre siems larf!el y from gain s posled by stores in a few
large r citi es ill which near-by military installations and defense plants have been parti cularl y important stimuli. More
th an half of the reporting stores in the District, however,
show decl ines of 5 percent or more for th e first 2 months of
1952 as co mpa red with the same period last year. The depre,s; ng effect on trade of the wi desp read drou ght conditions
in the Di stri ct has contributed 10 the vear-to-vear sales dedine, reported by many areas.
.
.
February sales in individual departments maintained about
Ihe ~a l1le pal lern \I hi eh had prevailed in other recent months.
RET All TRADE STATISTICS
(Percentage chong e)
NET SALES
STOCKSI
Feb. 1952 from
line of trod e
by area
DEPARTMENT STORES
Total Seventh District ••... ..• .. . .
COf"PUS Ctwisti •. . .....•••.•.•...
OollclI ..••.• .. ... .... • . •..•.. .
8P05O ••.. .. •••• . •••••••• , .•.
Feb.
Jan,
1951
1952
2
18
_ 1
-6
A
-3
_6
- 8
_14
_1
3
-3
Fort Worth ..••••.... .••. . ••...
Houston • •• • , • . •••• ••. • •.. . •.. •
San Anlonio . .. ..... .• .... • • .. .
I
2
3
10
Other cities .•.. .... . ... ... •.. . .
FURNITURE STORES
- 5
~ec:e~.o.r~I.~~':: :::::: :: :: :::: :
2A
11
3
30
Houston ••. .. .. . .. ... ... .•.• .. .
17
Port Arthur •• .•.........••..... -10
Son Antonio . .. . . . . ..... . ... . . .
31
Shreveport. La .... .. . . ..... . . . ..
2
Wichita Fa lls . ...•.. .. ..... . ...
35
Total Seventh Distri ct ••.• ••• . ••..
Austin •. ....... . •........ . •. . .
OOUOI ••••••••••••••.••... . •. .
HOUSEHOLD APPLIANCE STORES
Tota l Eleventh District •. . .........
Dolla s ....... . ... .. . .. ... . ... .
, Stocks at .nd of month.
I
- 28
- 28
A
_ A
-1
_9
7
11
2 mo. 1952
comp o with
2 mo. 1951
- 2
15
-6
-3
-6
3
2
6
9
- 11
Feb. 1952 from
Feb.
1951
-3
II
-2
-2
-8
_5
-6
12
10
1
Ja~
1952
9
13
7
12
8
7
12
16
13
6
- 16
-17
-23
_2
1
11
I
9
- 18
-19
-2
9
-12
27
-16
1
-19
-20
Indlcat.s ch<:inG. of I." than on.· ha lf of 1 p.rcent.
MONTHLY BUSINESS REVIEW
Basement slure sa les con tinued to run noticeably better than
Ihe main store, and women's apparel and accessories sales
made a more favorable showing than men's clothing or home·
furnishings.
Furniture store stocks showed a slight rise, after declining
for nine consecutive months. The l.percent increase, how·
ever, was smaller than normal for this time of year, and
stocks at the end of February were 16 percent lower than a
year ago .
WHOLESAtE TRADE STATISTICS
Eleventh Federal Reserve Diltrict
(Percentage change)
NET SALESp
STOCKSl p
February 1952 from
February 1952 from
February
1951
January
1952
2 mo.19S2
compo with
2 mo. 1951
-34
-13
-15
-9
-26
-25
-30
7
10
-1£
2
-3
-1
9
7
-22
-1
-8
7
39
5
2
-17
-20
-10
5
-3
9
Wines and liquors •.•.•..•.•
-5
12
-4
53
7
3
Wiring supplies, construction
malerials distributors .. ... .
20
26
Total new car sales in February in three major metropoli.
tan areas of the District- Dallas, Houston, and San Antonio
-as indi cated by new car registrations, fell almost 14 per·
cen t below January and were 28 percent less than in February
a year ago. This represents the smallest sales volume for any
month since February 1949.
line of trade
Automoti .... e supplies . , •••••..
Dry goods .• •. ....... . ... . .
Grocery (full.line wnolesolers
not sponsoring groups) ... ..
Hardware ••..•• .• .•• ..•.. .
Industrial supplies •• .•.•••••.
Mackinery equipment and sup·
piles IIllCepl electrkal .....
Tobacco products .... , .... ,.
Janua ry
1952
February
-.
1951
,
Stocks at end of month.
p-Preliminary.
, Indicates chengl!l af 11!I55 than one-half of I percent.
SOURCE: United States Bureau of the Census.
1
rharge accounL collections continued relatively slow. The
ralio of collections to charge account receivables outstanding
was 47 percent in February, the same as in January and two
percen tage points lower than February a year ago. The in·
~l alment collection ratio i" February, at 17 percent, was un·
,·hanged from January, although up three percentage points
f rom a year earlier.
Merchants are pursu in g conservative inventory policies,
after havin g correcLed largely the overinventoried position
which prevailed last spring and summer. The receipt of
sprin g merchandise caused a seasonal increase in department
,to re stocks in February, but end·of·month stocks were 3 per·
"('nt below a year earlier. Although orders outstanding rose
') percent during the month, they continued sharply below a
year ago, with the total outstanding at the end of the month
down 29 percent from a year previous.
INDEXES OF DEPARTMENT STORE SALES AND STOCKS
(1947-49-100)
UNADJUSTED
Rains during February and March in
the eastern half of the District greatly
improved 1952 crop prospects in these
favored areas, but most of the remainder
of the District continues dry, although light rains in southern
New Mexico and Arizona were helpful to ranges. West Texas
is particularly dry and has had a number of serious dust
storms in recent weeks. More rain is needed urgently in the
western half of the District to prevent soil.blowing, to stimu·
late growth of winter crops and grasses, and to provide mois·
ture needed for germination and growth of spring and
summer crops.
The winter wheat crop is making fair to good progress in
north Texas and is greening and making some growth in the
northern High Plains but is only holdin g its own in most
other sections of the District; the crop is deteriorating in
many Low Rolling Plains counties.
Cotton planting permits in the Lower Rio Grande Valley
were near the 1,000,000·acre mark by mid·March, but a large
acreage remained to be planted, because of the lack of soil
moisture and the shortage of irri gation water. The cotton
that has come up has made little growth. Some of the early
planted cotton was destroyed by a late.February freeze and
had to be replanted. Cotton planting is general in Coastal
Bend counties and is moving northward. Land preparation in
other parts of the District is well advanced or nearing com·
pletion.
ADJUSTED!
Feb.
JCJn .
Dec.
Feb .
Feb.
Area
1952
1952
1951
1951
1952
SALES-Doily o't'eroge
Elo't'enth District . ••• ........
Dollas ......•...••....•...
Houston ..... ... .......... .
93
•4
100
95
9•
104
203
19'
226
95
99
10 1
115
111
128
122
122
13.
122
11.
135
118
117
130
STOCKS-End of month
Eleventh Dbtrict . ... • . .•... .
121p 112
115
125
122p 12'
125
126
Jan.
Dec.
Feb.
1952 1951
1951
Adlusted for seasonal 't'oriotion.
p- Preliminory.
I
The improvement in district furniture store sales which
became apparent in the fall of last year was maintained
through February. Furniture store sales reached a record
high for thaL month, exceeding February a year ago by 11
percent. Sales were only slightly less than the very satisfac·
tory January level. A larger volume of credit sales continues
to be responsible for the year·to·year gains in the furniture
sto re trade, since cash sales are lagging behind year.earlier
levels.
Corn planting has been completed in many southern coun·
ties of Texas and was started as far north as the Red River
by mid·March. Planting of grain sorghums in the Coastal
Bend was practically completed in March, although more
moisture is needed in much of that area for germ ination.
Peanut planting was started in south Texas in early March,
despite a lack of adequate moisture. Flaxseed prospects have
improved in the winter growing area southeast of San An·
tonio since rain was received in early March.
Tomato and watermelon stand s in south Texas were thin·
ned by the late.February freeze, but conditions during March
were favorable for these crops to make fairly good recovery.
Plantings o f additional acreages of these and other crops, in·
cluding cantaloupes and cucumbers, were made during the
month. Early summer watermelon acreage in Texas is esti·
mated at 68,000 acres, or 7,000 more than a year ago. De·
MONTHLY BUSINESS REVIEW
56
velopment of the east Texas tomato crop is encouraging, with
setting of plants to fields well under way or com pleted in
most sections. The early spring onion crop in Texas, which is
now being harvested, is estimated at 4,025,000 sacks, or al·
most double last year's short crop.
Livestock are gaining rapidly on the generally plentiful
supplies of clover, oats, and winter grass in the eastern half
of the District, where recent rains greatly benefited grazing
lands. Wheat has supplied some green feed in the northwest,
but elsewhere in the District additional moisture is needed to
bring out native grass. Livestock marketings from the drier
areas continue heavy.
UVESTOCK RECBPTS
Production of milk and eggs in the District is running
above a year ago. Production of eggs in the five statesArizona, Louisiana, New Mexico, Oklahoma, and Texas-in
the first 2 months of ] 952 was 17 percent higher than in the
same months of 1951, with each state showing an increase.
Milk production, although ahead of the 1951 level, is below
the record rate of output recorded in 1950.
FARM COMMODITY PRICES
(Number)
fORT WORTH MARKET
613,000, due to the rise in prices to record high levels. The
average farm price of mohair in Texas in 1951 was $1.19 per
pound, compared with the previous record of 77 cents in
1950. Mohair production in New Mexico in 1951 declined
for the tellth consecutive )'ear; production in Arizona rose
slightly.
SAN ANTONIO MARKET
february
February
January
February
February
January
Oon
1952
1951
1952
1952
1951
1952
Catfle ••••••••••
25.195
12,229
88,776
28.747
12,193
59.250
25,960
28,730
14,375
105,708
19,385
13,053
6,311
20,998
18,447
6,906
17.4"8
18•.450
23,651
18,899
8,856
115,485
Top Prices Paid in locol Southwestern Markets
Calvel •••..•.. .•
Hogs., ........ .
Sheep .....•... .
1
3.4,615
,(0,214
lnelud., goo Is.
The 1952 early lamb crop in the principallamb.producing
states is estimated at 5 percent smaller than in 1951. The
reduction is due mainly to the later lambing and fewer breeding ewes in the early lambing states. In Arizona early lambs
are making fully normal growth, and marketing is expected
to begin about April 1. In Texas, however, droughty condi·
tions in eastern parts of the State last year forced sheepmen
to reduce their inventories, and the early spring lamb crop is
smaller, accordingly, than in 1951. Volume marketing of
lambs in Texas this spring is expected to come later than
usual.
The United States Department of Agriculture has an·
nounced that the ban on importation of Mexican cattle, in
effect since December 1946, will be lifted by September 1,
if there are no more serious outbreaks of hoof·and·mouth
disease south of the border. Before the embargo, the United
States received more than 300,000 head of Mexican cattle
annually. In this connection, an outbreak of this disease in
Canada in late February was followed by an immediate sus·
pension of shipments of Canadian cattle into the United
States.
Wool production in Texas last year fell to 48,712,000
pounds, which is 5 percent less than in 1950 and the smallest
since 1930, according to the Department of Agriculture. A
decline in the number of sheep shorn and lighter weights per
fleece account for the reduced wool tonnage. Ranchmen reo
ceived an average of $1.01 per pound for wool, which is by
far the highest annual average price of record. The value of
the 1951 clip was $49,199,000, compared with $32,947,000
in 1950.
Mohair production in Texas in 1951 totaled 12,280,000
pounds, or 3 percent less than in 1950. Fleece weights averaged 5.4 pounds, or the same as in the previous year. Cash
receipts from sale of mohair last year reached a record $14,-
Commodity and market
Cotton, Middling 15/16-inch, Dalla" .....•
WHE .... T. No.1 hard. Fort Worth •••••...••
OATS. No.2 white, Fort Worth ...........
CORN, No.2 yellow, fort Worth . ••.. .. ..
SORGHUMS, No.2 yellow milo. Fort Worth.
HOGS, Good & Cnoice, fori Worth ... ....
SLAUGHTER STEERS, Choice, Fort Worth.• ..
SLAUGHTER CALVES, Cnoice, Fort Worth .•.
STOCKER STEERS, Choke, Fort Worth ..••..
SLAUGHTER LAMBS, Good & Choke,
Fort Worth • . ..••..•.•... . .....•...•
COMMERCIAL FRYERS, Fort Worth ••.•••••
HENS, heavy, Fort Worth ••••...•••••.•.•
BROILERS, east T.xal ••••••••....•••••.•
BROILERS, south Texal ..................
Comparable Comparable
week
weele
Weekended
last year
Unit Mar. 21, 1952 lod mOtlfh
lb.
bu.
bu.
bu.
twf.
'WI.
$
.• U5
2.78
1.73
2.16~
3.19
17.50
(WI.
3.4.00
3.4.00
cwt.
33.00
cwt.
27.00
(Wi.
lb.
lb.
lb.
lb.
.29
.23
.27
.27
$
.4000
2.76
IJO
2.1214
3.1.'
, 8.50
33.50
34.00
3.4.00
26.50
.31
.23
.30
.30
$
... 77
2.6~
1.19~
1.95
2.55
22.00
37.00
36.00
39.00
36.00
The general level of farm commodity prices in the District
declined further in March, continuing the downward movement under way since last ovember. Late in the month,
prices of poultry, wool, dairy products, wheat, and many
classes of livestock were below a month earlier, while prices
of cotton and some grains were slightly higher. On Thursday,
March 20, Middling 15/ 16·inch colton on the Dallas Cotton
Exchange closed at 41.45 cents per pound, compared with
39,55 cents a month earlier. No.2 yellow corn closed on the
Fort Worth market on the same day at $2.1614 per bushelup 31h cents. Wheat prices rose until about midmonth and
then declined sharply; on Friday, March 21, No. 1 hard
wheat on the Fort Worth market fell to $2.70.%" top price,
which is the lowest closing price since November 1.
About 26 percent of the Nation's in·
sured commercial banks inl!urred excess
profits taxes in 1950, and about 21 per·
cent, in 1951. These preliminary esti·
mates are based on partial tabulation of data taken from tile
confidential tax questionnaires which were collected by the
Board of Governors of the Federal Reserve System. In the
second half of 1950 the insured commercial banks incurred
an estimated $15,000,000 of excess profits taxes; for the full
year of 1951 the amount was $24,000,000. These totals repre·
sent excess profits taxes on net current earnings less bond
losses, bad debts, and other similar charges. Capital accounts
of the banks in the excess profits tax bracket in 1951 are
estimated to be about $3,500,000,000, or 30 percent of the
total capital accounts or all insured commercial banks.
57
MONTHLY BUSINESS REVIEW
The tabulations now available show that 33 percent of the
banks which reported total capital accounts of $4,000,000 or
more as of June 30, 1951, incurred approximately $10,000,000 of excess profits taxes in 1951. This proportion would
have been about 42 percent if the tax liabilities had been computed on net current earnings alone, i.e., before the deduction
of bond losses, bad debts, and similar charge·offs. About 35
percent of the banks in the two intermediate· size groupswith capital accounts ranging from $250,000 to $3,999,999incurred over $J 2,000,000 of excess profits taxes in 1951, or
slightly more than 50 percent of the total. Approximately 12
percent of the smaller banks- each with total capital accounts of less than $250,000--incurred excess profits tax
liabilities of about $2,000,000, or 10 percent of the total.
Most of the larger banks used the invested capital method for
determining the excess profits tax credit, regardless of
whether it was necessary to pay the tax, while practically all
of the smaller banks used the minimum credit method.
Among those banks in the intermediate·size groups which
were subject to tax liability, about half used the income
method, with the remaining number using invested capital.
The majority of those lIot subject to tax used the invested
capi tal method.
Reports from over the District and from adjacent states
served by the southwestern regional Voluntary Credit Restraint committees indicate continued satisfactory cooperation among financial institutions and borrowers in furthering
the objectives of this voluntary program. The four committees operating in the Southwest, composed principally of
representatives of commercial banks, insurance companies,
investment banks, and savings and loan associations, coordinate their activities with the National Voluntary Credit Restraint Committee for the purpose of applying a uniform set
of principles nationally to applications for credits to finance
specific undertakings. In general, the principles promulgated
by these committees envisage voluntary restraint among both
borrowers and lenders and the indefinite postponement of
credits for nonessential or speculative purposes.
The results of the Voluntary Credit Restraint Program can·
not be assessed in a precise manner, first, because the figures
are not available and , second, because there is no way to
determine to what extent both lenders and borrowers have
been discouraged from making or seeking loans. Neverthe.
less, it is the opinion of those in the commercial hanking, in·
vestment hanking, in sllra nce, and savings and loan institu-
lion s that the program has been effective in discouraging
loans that might have been considered in the absence of the
program.
lletween February 20 and March 19, changes in the prin.
cipal categories of assets and liabilities of the weekly report·
ing member banks in th e Eleventh District included decreases
in loans and investments and increases in cash assets and
deposits. The reduction of loans and investments during the
4 weeks was more than offset by the net expansion in reserves,
eash, and balances, with the result that resources rose $35,
003,000, or somewhat less than 1 percent, to a total of
$4,331,219,000.
The volume of loans declined slightly, with the over·all de·
crease amounting to on ly $5,792,000. Real estate loans, con·
sumer·type loans, and loans for financing security transactions rose; but decreases in other categories, principally
loans to banks, were somewhat more than offsetting. The de·
mand for commercial and industrial loans was mixed during
most weeks of the period, with manufacturers of petroleum
and allied products, wholesale and retail trade establishments,
and a groll p of miscellaneous borrowers increasing their
outstanding bank indebtedness. On the other hand, approxi.
mately offsetting reductions were made by other firms, prin.
cipally cotton dealers, sales finance companies, and construe·
tion firms. On March 19, loans were only slightly less than
the record total of $1,570,000,000 reported February 6.
CONDITION STATISTICS OF WEEKLY REPORTING
MEMBER BANKS IN LEADING CITIES
Eleventh Federal Reserve District
{In thousands of dollars}
Item
March 21,
1951
February 20,
1952
1,542,286
1,55 8,559
$2,642,871
1,465,349
1,480,681
$2,904,371
1.548,067
1,564,351
1,084,9.48
7.915
1,022,.439
9,491
1,085,496
7.660
57,541
114,635
549
292.971
1,304,156
184,754
167,112
177,912
55,544
122,080
1.810
269.317
1,162.190
57,231
0
355,856
55,639
113,081
10,88.4
291,591
1,340,020
225,762
162,571
180,584
609,464
164,914
591,779
489,700
2,412,725
451,817
76,28"
789,298
0
585,092
164,0 11
554,729
346,537
2.229.319
414,954
93,095
628,997
1,000
605,995
165,108
564,512
411,031
2,337,890
452,425
77.076
794.894
3,200
Maren 19.
1952
Totallodns (gron) and in....stments ..•.•.••••• $2,862,715
Total Joans-Net l •• • . . . • . • . • • • • • • • • • • • . •
TOlal loans-Groll •.. .. •. ... ..... ..... • .
Commercial. industrial, and agricultural
Joans •. •••. . •• ..•••...•• • ••.... ..•
LOQns to brokers ond deolers in securities ••
Other loons for purchasing or carrying
securi,ies •.. ••...•....• •••.••••.• ..
Real eitg'e loon •••••....•...... . •.•..
Loons to banks • • • •••....•.•.. . • . •••••
All a'her logns •• •••••••.••.•••. .. ••••
To'ol investments • • .•.•... • . •.•.•.••.•.•
U. S. Treasury bills • .•....• ••••• •• •••. •
U. S. TreasurycertiAcatesgfindebtedness • ..
U. S. Treasury notes •••••.•••.. ••• . .•..
U. S. Government bonds {inc. gld.
obligations) • ••. . ••••.•••••.• •••••••
Other securities •.• • . • . •.•••••• •••••..•
Reseryes with Federal Reserve Bonk •..•.•. •••
8alances with domestic banks •••••••••• • . • ••
Demand deposits-adjusted! ................
Time deposits except Government ••••••••. • ••
United Sta'es Goyemment deposits •••••• ••• ••
Interbank demand deposi's •.•.•••.••••• • •••
Borrowings from Federal Reserve 8gnk •••••••.
I After dedl.l(tions for reserves and unallocated charge-offs.
Z Includes all demand deposits otner than interbank and United Slgles Government, leu
cg sn items reported as on hgnd or In process of called ion.
Investments of the weekly reporting member banks de·
clined $35,864,000, or somewhat less than 3 percent, during
the 4 weeks, with sales or redemptions of Treasury bills more
than accounting for the change. Holdings of other Government securities rose fractionally, on balance, rellecting prin·
cipall y the incre ase in certificates, while investments in
municipals and other nOIl·Government securities showed vir·
tually no change. On March 19, Treasury bills accounted for
about 14 percent of the total investments of these banks, as
compared with approximately 5 percent on the comparable
day last year. Higher bill yields, increased price lIexibility in
the Government securities market, and Treasury financing
operations in the bill market largely account for the change.
Deposit trends during the 4 weeks included increases in
bolll demand and time deposits of individuals, partnerships,
and corporations. The expansion in the former accounted for
about 95 percent of the increase of $45,441,000 in total deposits. The increase in deposits of individuals and businesses,
mostly jn the week ended March 19, rellects in part rather
heavy net expenditures in the District by the Treasury, the
effects of which were not offset immediately by the collection
of income tax checks and the transfer of funds to government
accounts. Because of Treasury calls on the Tax and Loan
MONTHLY BUSINESS REVIEW
S8
accounts, for payment on March 18 and 19, and the normal
delay in clearing checks, government deposits rose only
$21,809,000 during the week ended March 19. Treasury de·
posits had heen permitted to decline during the preceding 3
weeks. It is probable that the collection of income tax checks
in the week ending March 26 will be reflected in a substantial
reduction of individual and business deposits anrl an increase
in government deposits. 0" March 19, Lotal deposits of the
weekly report.ing member banks amounted to $1(.,004. 911,000,
or about 1 percent higher than'" weeks earlier.
GROSS DEMAND AND TIME DEPOSITS Of MEMBER BANKS
Eleventh Federal Reserve District
{A'feroges of daily figure~. In thousands of dollars I
COMBINED TOTAL
ReSERVE CITY BANKS
Gross
Date
COUNTRY BANKS
Gross
demand
Time
demand
Gross
demand
TIme
Time
counted for about GI percent of both the uecrease in demand
deposi ts and the in crease in time deposits.
Th e volume of business transacted throu gh banks in the
Eleventh District, as reflected by debits to deposit accounts
reported by ban ks in 24 major cities, was 10 percent lower
in February than in January but 14 percent above the year·
ea rlier total. The decrease ill February reflects both the sea·
sonal reduction in business activity and the smaller number
of business da ys in the month. The decline in debits was gen·
eral over the District, with each of the reporting cities show·
ing a decrease within the range of less than 1 percent (Ama.
rillo. Te xas ) to 24. percent (Roswell , New Mexico). Tbe
turnover of deposits, whi ch reflects the annual rate of use of
deposit accounts, was 14.0 in Feb ruary, as compared with
15.5 in January and B.2 ill February, 1951.
CONDITION Of THE FEDERAL RESERVE BANK Of DAllAS
Februar't. 1950 . . 55,617.162 $661,292 52,660,793 $420,111 $2,956,369 $241,181
Februarf 1951 .. 6.108,995 648,772 2,951.883 395,551
3,157,112253,221
Odober 1951 ... . 6,361,591
November 1951 . . 6 ,5 92.874
3,017,115
3,101,804
3,170,047
3,162,301
3,030,813
681,258
686.144
706,327
714.332
721,578
December 1951 •.•
6,753,139
January 1952.... 6,779,.455
February 1952... 6,567,8.046
373,996
376,802
390,143
391,577
395,992
3,344,476
3,491,070
307,262
309,342
3.583,092
3,617,154
3,537,033
316,184
322,755
325,586
Gross demand deposits of all member banks in the District
averaged $6,567,846,000 during February, or about 3 percent less than in January. On the other hand , time deposits
rose $7,246,000, continuing the upward trend that had pre·
vailed in the precedin g 10 months. The changes in deposits
during February were more marked at some of the banks in
the larger cities of the District, since reserve city banks ac·
BANK DEBITS, END·Of·MONTH DEPOSITS
AND ANNUAL RATE OF TURNOVER Of DEPOSITS
(Amounts in thousands of dollars)
DEBITS '
ARIZONA
Tucson ............. .
LOUISIANA
Monroe ....... ......
Shreveport ....... . ..
NEW MEXICO
Roswell •........... .
TeXAS
Abilene ............ .
Amarillo ....... ... . .
Austin ........... .. .
Beaumont .......... .
Corpus Christi . .......
Corsicana .......... .
Dallas. .. ...........
8 Paso ........ .... .
Fort Worth ...... . . . .
Galveston ......... . .
Houston .......... .. .
Loredo .. ....... . , . .
Lubbock . ... . . . .....
Port Arthur . . ... .. ...
Son Angelo ..... .. . . .
Son Anlonio . ..... . ..
Tellarkana ~ ........ . .
Tyler . . ... . .. .......
Waco . ... .. . .......
Wichita Falls . ........
February
1952
Annual ral.of turnoyer
Feb.
1951
Jan.
1952
89,93.4
20
_5
$ 107,3.43
42,686
11 -19
34
-9
49,434
200,497
188,819
March IS,
1952
It em
Total gold :ertiAcate reserves .......• . .
Discoun!s for member bank, . ... .
Industrial advances .... ... . . ... .
Foreign loons on gold . . . ... . ........•.....
U. S. Government securities . .. , .......... . . .
Total earning a ssets ................ ...... .
Member bonk reserve deposits .. ...... . .... .
Federal Reserve notes in actual circulation .... .
714,742
3,000
20
o
1,064,166
1.067,186
1,080,563
676,112
March 15,
1951
February 15,
1952
530.655
653,176
8,500
1,072,685
1,072,685
9.43,695
615.111
1,060,941
1,069,457
1,023,353
673,080
o
o
o
16
o
NEW PAE BANKS
Th e First Siale Bank, Rugers, Texas, an ,:nsured
nonm.em.ber bank located in the territory served by
the Head Office oj the Federal Reserve Bank of Dallas,
was added to the par list on February 11, 1952. The
officers are: R. B. McElroy, President; Earl D. Reed,
Cashif'r: and Em.il Schiller, Assistant Cashier.
DEPOSITS!
Percentage
change from
City
(In thousands of dollars)
February 29, feb.
1952
1952
1951
Feb.
Jan.
1952
10.1
9.7
10.8
10.4
11.4
9.2
9.1
12.0
12.1
21,797
9
-24
28,373
9.1
9.1
11.8
48.369
4
16
10
16
29
9
3
6
22
9
22
15
8
23
-2
16
23
18
3
23
- 14
53,899
11 0,219
106,311
100,882
103,005
22,32.4
1,029,538
149,208
10.7
15.1
17.2
14.8
15.2
10.8
14.5
15.8
13.6
12.7
12.0
14 .8
19.8
15 .4
16.7
6.7
6.4
15.7
1.4.2
15.1
17.0
14.5
13.8
8.3
The Ric/dal1.d Slate Bank, Rayville, Louisiana, an
ins""ed nonmem.ber bank located in the territory served
by the Head Office of the Federal Reserve Bank of
Dali"s, was addpd to lhe par list 011 March 10, 1952.
The officers are: fred Morgan, President; James R.
Craig, Cashier; F. B. Hatch, Jr., Assistant Cashier; and
B. L. Waite, Assislant Cashier.
141,156
166, 106
12 3,032
131,223
12,568
1,331,649
174,998
472.850
74.401
1.491.303
21.419
112,133
43,786
40,645
372,308
20.613
51.122
66,762
81,345
Totol- 2" cities ........ $5,321,024
- #
- 16
- 5
- 10
-20
- 15
- 9
-9
-9
-9
-4
-17
- 12
-4
-1
-3
-10
-8
-10
1 4 -10
383.622
18.4
15.6
16.7
100,945
8.8
8.3
9.7
1.136,573
22.927
100.7 83
44,661
15.8
11.3
13.0
11.8
13.4
10.3
12.5
10.4
17.0
11.6
14.9
13..4
51,180
384,268
24,481
9.2
11.5
9.6
9.2
10.7
10.1
8.2
11.4
9.0
9.2
10.2
87,468
10.4,370
9.7
8.3
11.6
10. 1
12.4
9.6
10.1
54,556,012
14.0
132
15.5
53,701
,
, Debits to deposit atcounts except inl erbank accounts.
1 Demond Clnd time deposit~, including ce rtifil!!d tlnd officen' cheCKS outstanding but ex.
cluding deposih to the credit of banKS.
a This flgure includes only one bonk in Tellarkana, Tl!!xas. Tola l d l!!bits for all ba;,ks in
Tellorkana. Texas.Arkansas, including two bonks localed in the Eighth District, amounted to
$36,153,000 fOf the month of February 1952.
I Indicates change of leu than one·holf of I percent.
1ndll st rial activity in the Eleventh Dis·
trict in creased moderately from Febru·
ary to March, approximately in line with
the usual seasonal pattern. Activity ex·
panded in a number of def ense·type industries, such as
ordnance. primary metal s, fabricated metals, machinery,
chem icals, and shiphuilding and repairs, as well as in apparel
and food process ing. Heavy construction for defense indus·
tries and for the Armed Forces increased, as did oil produc·
tion . sulphur mining, and various other nonmanufactu ring
activities. The cement, carbon black, natural gasoline, and
cottonseed products industries also were operating at rela·
tively hi gh levels. However, there was a slower tempo in pro·
duction of aircraft and so me other types of defense materials,
as well as in textile mill activity.
59
MONTHLY BUSINESS REVIEW
The industrial gains in the District are reflected in the rise
of nonfarm employment in March to approximately the level
of last November, which was second only to the December
record. Nonfarm employment in March was about 4 percent
hi gher than a year ago, with recent gains reported in most
of the leadin g cities of the District ; there were declines in
San Antonio and Amarillo, which resulted from completion
of a number of defense construction projects in those areas,
while in Texarkana a layoff of workers in lumbering more
than offset increases in defense lines.
A rise of unemployment early in 1952 was partly seasonal
and partIy the result of lower-than-usual farm employment
in many drou ght·stricken parts of Texas. The indefinite post·
ponement of the nationwide oil refinery strike removed for
the present a serious tI,reat to employment and economic
activity in this District, where some 50,000 persons are employed in oil refineries, with at least 120,000 more engaged in
other phases of the oil and gas industry.
After a decline of three consecutive months, crude oil production in the District rose in February to a record 3,194,000
barrels per day, or 5 percent more than in January and 11
percent above a year ago. The further increase of allowables
in March- by 56,000 barrels per day in Texas and 6,000
barrels per day in Loui siana-ushered in a still higher record
output. These gains in the District account for the larger
part of the increases that occurred in the Nation during hoth
February and March. On April 1, however, the upward movement will be reversed when Texas allowables are reduced by
11 5,000 barrels daily from tbe March 15 level, or 88,000
barrels daily from the March 1 rate. This will more than offset
a 3,ooO·barrel-per-day increase in Louisiana allowables.
February 1952
9
10
North..... . ........ .. 4,708,450
Panhandle ...... . .. . .. 2,411,950
Tatol Texas •...... .. 8,(.406,650
NeW Muieo. . . . . . . . .. . . . . . 4,522,050
North Louisiana ......... ... , 3,708,200
Total Eleventh District •. .. .. 92,636,900
OUTSIDE ELEVENTH DISTRICT. .. 91.610.150
UNITED STATES., .• •. . • • •..•• 1 U,247,050
CRUDE PETROlEUM AND NATURAL GAS LIQUIDS,
ESTIMATED PROVED RESERVES
(Amo,,"";n mil!;"". of barrel.1
New supplies
developed In 1951
Area
ReserYes
Reserves Extensions
Pradtlction Jan, I,
IJan, 1,
and
1952
1951
revisions Discoveries in 1951
Change In reserves
Amount
Percent
2,829
686
1,677
16,078
336
108
288
3,002
59
10
34
249
254
62
211
1,137
2.970
742
1.788
18.192
141
56
111
2.114
5
8
7
13
Totol EleYenth
District states 21.270
8.266
Other states ••
3,734
939
352
113
1.664
817
23.692
8,501
2,422
235
11
3
29,536
4,673
465
2,481
32,193
2,657
9
Lotlislano •• • . •
New Mexico • •
OklohomCl ••••
Texos • ..• .. •
Increos. or decrease in daily
CI'Ierage production from
ElEVENTH DISTRICT
Texas R. R. Com. DI,tricts
1 South Central....... . .
958,800
2 Middle Gulf.. .. . ... . . 4,923,350
3 Upper Guff ..... . .... . 14,460,450
.. Lower Gulf . ......... . 7,723,750
5 Eosl Central. . . . . . . . . .
1,813,1 SO
6 Northeast .......... . . 11,576,750
fad Texas... .. .. .. 7,863,300
Other fle lds....... . 3,713,450
7b North Central. . . . . . . . . 2,562,600
7c Westeentral ......... 4,114,750
8 W.st .......... . ... . . 29,152,650
Drilling activity, as indicated by well completions in the
first 2 months of 1952, is running appreciably ahead of last
year in both the Nation and the District, with the Spraberry
trend accounting for an appreciable proportion of these increases.
SOURCESI American Petroleum Institut••
Americ:an Gas Association.
(Sarrel"
Area
During the 6 weeks ended March 15, national stocks of the
three major types of burning oils were drawn down by
21,000,000 barrels, or about 18 percent, in line with the usual
seasonal excess of consumption over new supply. On the other
hand, gasoline stocks in the Nation increased by 10,000,000
barrels to reach a record of 146,000,000 barrels, the result of
the high level of refinery output and the seasonally low rate
of consumption of this product. Crude oil stocks changed
little in the District and declined only 2,000,000 barrels in
the Nation. Stocks of crude oil, gasoline, kerosene, and light
fuel oil are decidedly more ample than a year ago, but stocks
of residual fuel oil are somewhat lower.
United States.
CRUDE OIL PRODUCTION
Total
production
The postponement of the strike reduced this incentive toward
a high rate of activity_
Dailyo't'g.
produ<:tion
33,062
169,770
,(98,636
266,336
62,523
399,198
271,1.48
128,050
88,366
1.41,888
1,005.264
162,360
83.171
2,910.574
155,933
127,870
3,194,377
3.158,970
6,353,347
Feb. 1951
1,066
14,406
20,663
23,007
15,502
19, 169
-795
19,964
10,725
55,386
138,994
15,026
-6,765
307,179
21 ,276
-1,451
327,004
94.772
421.776
Jan. 1952
656
9,957
23,044
15,189
10,258
6,523
2,787
3,736
4.266
11.904
66,054
J.,744
-363
152.232
4.207
-73
156.366
2.001
158,367
SOURCE, Estimated from Americ:on Petroleum Institute weekly reports.
Refinery activity as indicated by crude oil runs to stills
averaged 1,962,000 barrels per day in the District during
February, or fractionall y less than in January but 7 percent
above a year earlier. These changes in the District contributed to similar changes at ti,e national level. Toward the
end of February and during the first week of March there was
some stepping-up of refining, in order to accumulate stocks
of products for use if the refinery strike were to take place.
The estimated proved reserves of crude oil plus natural gas
liquids in the states of this District rose to 23,692,000,000
barrels on January 1, 1952, a gain of 11 percent from a year
earlier, according to estimates just released .by the American
Petroleum Institute and American Gas Association. National
reserves rose to 32,193,000,000 barrels for a 9-percent gain,
as shown in an accompanying table. New supplies developed
in the states of this District during 1951 amounted to 4,086,000,000 barrels, or considerably more than the 1,664,000,000
barrels produced in the same year. In the Nation new supplies developed amounted to 5,138,000,000 barrels, compared with a production of 2,481,000,000 barrels. However,
most of these new supplies represent extensions and revisions
in existing fields. Reserves in the slates of this District
amounted to 74 percent of the national total , with Texas alone
accounting for 57 percent, and Louisiana, 9 percent.
The estimated proved reserves of natural gas in the states
of this District rose to 158,052,000,000,000 cubic feet on Ianuary 1, 1952, for a gain of 6 percent from a year earlier, as
shown in an accompanying table. The 66-percent gain in
New Mexico is especially impressive. Outside of this District
there was a small decline, so that reserves in the Nation rose
only 4 percent, or to 193,812,000,000,000 cubic feet. New
MONTHLY BUSINESS REVIEW
60
supplies developed in the states of this District during 1951
amounted to 14,600,000,000,000 cubic feet. but only 2,585,·
000,000,000 represent new discoveries-an amount less than
half of production during the year. In tbe Nation new sup·
plies developed totaled 16,053,000,000,000 cubic feet; dis·
coveries, 3,039,000,000,000 cubic feet. Reserves in the states
of this District accounted for 82 percent of the national total,
with Texas alone accounting for 55 percent and Louisiana,
15 percent.
NATURAL GAS, ESTIMATED PROVED RESERVES
IAmounts in billions of cubic f •• t)
New supplies
developed in 1951
Reserve, Extensions
Raserves
Production Jon.. I,
Jon. 1.
ood
1951
revisions Discoveries in 1951
19.5 2 1
Areo
28,533
481
132
118
Change in reserves
Amount
Percent
11 ,804
105,653
472
4,599
170
3,249
2
66
1
3
-1
6,991
1,148
4,786
11,634
Teltos ...... . 102,404
769
5,312
1,854
1,157
316
727
3,918
36,031
12,015
999
2,585
454
1,849
158,052
35,760
8,490
-271
United States. 185,593
13,014
3,039
7,967
193,812
8,219
louislonCl •••. .
New Me.ieo ..
Oklakomo ..••
29,005
11,590
BUILDING PERMITS
2 months 1952
Percentage
change in
valuation
from 2
months
Percentage
change in
va luation from
February 1952
Humber
Feb.
City
Number
LOUISIANA
Shreveport . . . •
TEXAS
Abilene . ...•. .
Amarillo .... . .
Austin •.•..•. .
Beaumont •••• .
Corpus Chris'i ••
Dallas . •••..• .
8 Paso •• ...• •
Fort Worth •.••
Galveston •... .
Houston ••... . •
lubbock • ••.. .
Port Arthur ••.•
Son Antonio . ••
Waco •... ...•
Wichita falls ..
Total .••..... .. .
300 $ 1,345,704
106
428
277
211
363
1,887
419
861
99
913
345
133
1,389
459
67
342,955
2,617,555
3,401,335
832,301
1,225,305
8,140,590
3,812,331
2,860,668
303,308
8,119,867
1,637,032
175,185
3,739,097
2,210,525
3,223,074
8,257 543,986,732
Vall.KJtion
Jon.
1951
Valuation
1952
1951
584
2,463,121
-36
199
797
520
490
704
3,"75
664
1,534
240
1,869
615
276
2,732
806
188
963,355
4,475,686
4,881 ,470
2,013,224
2,438,834
14,284,513
4,654,211
5,852,956
513,715
17,350,899
2,762,185
"32,897
6,855,493
3,488,350
9,469,234
-47
-4
-21
29
-69
-38
24
-56
33
-47
-18
-38
-21
13
1315,693
18
$82,900,143
-28
20
.,
-64 -45
26
28
130
34 -30
-57
1
18
32
353
99
-4
-69
153
_H _12
45
29
-35 -32
86
20
36
73
784 -48
..
-9
.
• Over 1,000 percent.
Total 8evenlh
OlJtrid stotes 149,S62
Other stoteli • •
I
6,118
6
Reflects net chong!!1t In underground storage of -3 in New Mexico, lO in Oklahoma, 1
n Texas, 125 In other states, and 133 in the United States.
SOURCE: American Gos Association.
The value 9£ construction contracts awarded in the Dis·
trict during February rose about 10 percent above the Janu·
ary total and amounted to $88,000,000. Residential awards,
which amounted to S33,000,000, were down about 7 percent
during February, while nonresidential awards rose to $55,·
000,000, up 22 percent. The nonresidential figure reflects a
number of large industrial, utility, military, and public build·
ing projects. As com pared witb the February 1951 record,
however, both residential and nonresidential awards were
down ~.s percent.
Cement production in Texas amounted to 1,585,000 bar·
rels in January, down 1 percent from the previous month but
J 2 percent more than in J alluary of last year, according to
Ihc latest reports available, Shipments from cement mills
amounted to 1,611,000 barrels, exceeding production and
representin g a gain of 18 percent from a year ago. The high
level of cement sh ipm ents reflects the rise of heavy construc·
tion activity in the Southwest, especially military and defense
plant projects. In the l\ation, output was 2 percent below a
year earlier, whi le shipmen ts were up ~, percent.
COTTONSEED AND COTTONSEED PRODUCTS
TEXAS
UNITED STATES
August 1 to January 31
AtJgust 1 to January 31
Item
(In thousands of dollar,)
January-Febrl.KJry
February
Area and type
ELEVENTH DISTRICT ••
Residential • ••• •••
Al l other .••...•..
UNITED STATES ' •.•.
Re$idential •••...•
All other ••..•..•.
February
January
1952p
1951
1952
1952p
1951
$ 88,206
32,978
55,22 8
885, 206
396,438
488,768
S 160,95 1
60,808
100,143
1.140,527
531,146
609,381
S 79,999
35,424
",575
902,091
337,721
564,370
S 168,205
68,402
99,803
1,787,297
734,159
1,053, 138
S 264,105
118.214
145,891
2,183,775
952,064
1,231,711
I 37 states east of the Rock y Mountains.
p-Preliminary.
SOURC& f. W. Dodge Corporation.
Late in February and early in March the outlook for con·
struction improved somewhat as tbe result of a series of reo
laxations of controls over materials used in public, commel··
cial, industrial, and residential building. Moreover, a number
of public and commercial projects which previously had been
held up by the National Production Autbority were recon·
sidered and certified . These steps were taken followin g the
easing of the steel and aluminum and, to a lesser extent, cop·
per suppl y situations as the result of increased production of
these materials and the la g in defense requirements below
earlier schedules.
Thi s season
lost season
This season
Last season
COTTONSEED (tons)
Received at mills .• ••. .. . .•.
Crushed •.•••...•.•... .
Stocks, end of pe rio d •••. . .. .
VALUE OF CONSTRUCTION CONTRACTS AWARDED
1,320,4"1
1,001,320
386,912
947,139
857,076
297,854
5,121,906
3,691,454
1,5"',646
3,251,733
2,698.423
837.810
COTTONSEED PRODUCTS
Productton
Crude oil (tl\ousond pounds)
Cake and meol(tons} .• . ..•
Hulls (tons} • ... .. • .•.....
Linte" (running bales) • • . • .
313,569
483,862
227,208
313,676
266,596
398,591
200,753
258,849
1,152,172
1,714,124
825,484
1,177,605
854,838
1,20 5,806
617,733
892,663
Stocks, end of period
Crude oil (thousand pounds)
Coke and "'eol(tons) • ••• ..
Hulls (tonsl .. . .... ··· · ···
Unte rs (running boles) . ... •
31,929
19.289
11,285
49.737
1 5,884
54,122
26,458
69,784
109,001
56,737
40,166
247.369
"5,739
199,13"
87516
232,603
SOURCEI United Sta les 8ureau of the Census.
I\lilitary prime co ntracts let in Ihe fivc southwestern states
in the last half of L951 amounted to $821,000,000, which
represents 6 percent of the national total, with Texas alone
accounting for 5 percell!. II subcon tracts were added, the
figure wou ld he substant iall y higher, since the Southwest has
many small manufacturing plants. These percentages are ap·
preciahly above figures for the first 12 mintbs after Korea.
The total of such contracts in the five states during the July
1950·December 1951 period is $1,830,000,000. This includes
5194,000,000 of petroleum products contracts, which is 30
percent of the petroleum products total for the Nation.
@FedFRASER