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MONTHLY BU SINESS REVIE W
of
the
Volume 30
FEDE RA L RESERVE BANK of Da llas
Dallas, Texas, December 1, 1945
Number 10-12
SOIL CONSERVATION: A PROBLEM OF COMMUNITY WELFARE
As long as there were unoccupied agricultural areas in the western United States, there was a
tendency to disregard the conservation of the soil. Often, the system of farming that promised to yield
the largest immediate cash returns was accepted as most desirable. That the long-run productive
capacity of the soil might be destroyed or seriously impaired in the process was apparently considered
of no consequence for rich, virgin land was always available. This attitude contributed to the adoption
of a one-crop system of farming without adequate provision for rotations, cover crops, green manure
crops, terracing, strip cropping or other sound conservation practices that would have aided in conserving the soil. With the development of a more highly industrialized economy, the extension of farm
mechanization, and increasing soil deple tion, the problem of securing sufficient cash to pay taxes,
mortgages, living costs and to purchase equipment became more difficult to solve and in many cases
the pressure to maintain the single cash crop system was increased.
The deterioration of the soil is only one phase of the fundamental problem confronting agriculture. The recurrent surpluses of various important agricultural commodities and the frequent adverse
relationship which has existed between agricultural and non-agricultural prices and incomes are
problems which deserve intensive study. Further consideration, however, should be given to an expansion of soil conservation and improvement and to the coordination of such conservation measures with
such programs as may be undertaken to cope more adequately with these other aspects of the agricultural problem.
Communities that depended largely on agriculture for their existence have been sorely affected
by the deterioration of the soil because, to a great extent, the quality of the soil of an agricultural area
determines the area's productivity and its level of income. Many such communities have been prevented
from expanding and improving, and their social and economic structure has been progressively undermined. Merchants, bankers and small local manufacturers in such communities too often have been
forced to suspend operations or have been prevented from keeping pace with the growth of similar
businesses in other areas. Local governments have suffered declines in their revenues from taxes on
farm land and have been unable to exercise t hose functions which tend to broaden the economic and
social aspects of rural community life.
In the Southwest the prosperity or depression of agriculture is of the greatest importance to
the economic welfare of the area. Despite the comparatively recent industrial growth and development
of some of its urban centers, farming enterprises still strongly predominate in the economy of the
several states comprising this region. Farmers in the Southwest, in common with those in other
agricultural areas of the country, because of a lack of knowledge and understanding of conservation
principles or because of financial necessity, or possibly for various other reasons, have not protected their
land from the destructive forces of wind and water. As a consequence, extensive damage from erosion
and soil deterioration has occurred. Estimates based on figures furnished by the Soil Conservation
Service indicate that in the Eleventh Federal Reserve District erosion has stripped away three-fourths
of the top soil on approximately one-fourth of the land in farms. Much of the remainder of the land
has suffered varying degrees of deterioration. It is estimated that only 10 to 15 per cent of the area
is undamaged. The fertility of the soil has been seriously impaired by leaching and poor cultural
practices; many of the essential elements have been exhausted and the removal of organic matter has
reduced the water-holding capacity of the soil, thus contributing to the breakdown of its structure.
This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)
2
MONTHLY BUSINESS REVIEW
It has now become increasingly clear that steps must be taken to prevent further destruction
of the soil and to repair the damage that has already occurred. For many years public and private
agencies and individuals have attempted to acquaint the public with the needs and basic principles
involved in a sound soil conservation program. As a result of these efforts considerable progress has
been made from an educational standpoint and from the physical treatments applied, but the job
to be done is too big for individual efforts to accomplish completely. In 1929, the United States
Department of Agriculture actively entered the field of soil conservation with the establishment of
a number of erosion control experiment stations throughout the country to promote research
concerning the basic scientific facts necessary to establish a sound soil conservation program. Four
of these stations have been established in Texas; at Temple, Tyler, Dalhart and Bushland, and in
addition, the Texas Experiment Substation at Spur has conducted erosion control studies for a number
of years.
The extension services of the various states pioneered in making information accumulated by
their experiment stations available to farmers, and also aided them in applying this information to
the conservation problems of their individual farms. The Agricultural Adjustment Act, passed in
1933, emphasized the importance of conservation and soil building practices by offering cash payments
to encourage farmers to reduce the area planted in soil depleting crops by the substitution of soil
conserving and soil building crops. In the Southwest this reduction of soil depleting crops led to a
more diversified type of agriculture with such soil conserving and improving crops as winter grains,
vetch, Austrian winter peas and other legumes being substituted for cotton and wheat. Later legislation
provided for payments by the Agricultural Adjustment Administration for such practices as the
construction of terraces, drainage systems and ponds, and the improvement of pastures by seeding
with approved pasture mixtures and by the application of lime and fertilizers. Also in 1933, the Soil
Erosion Service was created in the Department of the Interior to demonstrate on a farm-wide, watershed basis the control of soil erosion by the application of well-known practical conservation measures.
The Civilian Conservation Corps also worked in cooperation with the Soil Conservation Service and
farmers in the establishment of complete soil conservation programs on individual farms. In 1935, the
Soil Erosion Service was transferred to the Department of Agriculture and a permanent agency, the
Soil Conservation Service, was created to continue and expand the work started by the Soil Erosion
Service.
As a result of, and in conjunction with, Federal activity in the field of soil conservation, all of the
states in this Federal Reserve district have passed enabling legislation providing for the establishment
of soil conservation districts and state boards of conservation to regulate or advise farmers in the
districts. This enabling legislation varies in minor detail from state to state but the general principles
as stated in the Texas Soil Conservation Law are typical. This law provided for the establishment of
soil conservation districts throughout the State. The objectives of the legislation are set forth as follows:
"To provide for the conservation of soil and soil resources of this State, and for the control and
prevention of soil erosion, and thereby to preserve natural resources, control floods, prevent impairment
of dams and reservoirs, and assist in maintainir).g the navigability of rivers and harbors, preserve
wildlife, protect the tax base, protect public lands and protect and promote the health, safety and
gener.al welfare of the people of this State." The law provided for the creation of a State Soil
Conservation Board to receive petitions from farm owners interested in organizing a soil conservation
district and to aid them in the organization of such districts.
The organization of soil conservation districts in Texas and in other states is initiated by farm
owner-operators in any such homogeneous area, as a township, county, or watershed. Under the
various state laws local farmers may _present a petition to their state conservation board for the
organization of a district. The board, then, may call a referendum in which all of the owner-operators
MONTHLY BUSINESS REVIEW
in the affected area may vote. If the plan to establish a district in the area is approved, supervisors
are chosen either by election or by appointment by the state board. These supervisors, who are farm
owner-operators, are charged with administering the affairs of the district; thus, the control is vested
in the f armers living in the area concerned. The supervisors working with land owners and other
interested individuals and agencies are charged with the development of a program of conservation
for the area. Since the soil conservation districts generally are not permitted to levy taxes or issue
bonds, they must depend largely upon other sources for the technical assistance and equipment
necessary to carry out their conservation programs.
Technical aid to the various districts is available from the Soil Conservation Service. Upon request
of the supervisors of a district, the Soil Conservation Service will assign a staff of technicians to the
area to assist farmers in planning, establishing and maintaining soil conservation farming systems. In
addition, the Soil Conservation Service can also make various kinds of conservation equipment available
to the district, such as terracing and ditching machinery, equipment for laying out contour lines,
and other specialized types of machinery.
In Texas, the first soil conservation districts were organized in 1940, and at present eighty-six
districts are in operation and receiving assistance from the Soil Conservation Service. An additional
forty-one districts have been organized and will soon be in a position to formulate conservation programs for their areas. Sixty-eight per cent of the total land area of Texas is included in these 127
districts, most of which are located in northern and eastern Texas. 'About twenty-five thousand farmers
and ranchers have signed agreements to plan and carry out complete soil conservation programs. The
Soil Conservation ServIce has assisted irrigation farmers in improving their water disposition systems
on over twenty-six thousand acres. Drainage work has been confined to assisting farmers in solving
their individual problems.
Forty-four soil conservation districts had been issued certificates of organization prior to April 15
of this year in New Mexico and 64 certificates had been issued in Oklahoma. Sixteen districts in
Louisiana and 19 in Arizona had received certificates.
It is impossible to estimate accurately the extent of improvements which have resulted from the
conservation work already accomplished, but the increase in yields and volume of production during
the past fifteen years certainly h~s been, to a considerable extent, a consequence of the conservation
practices undertaken. In those areas of the Southwest where a complete conservation program has been
in effect for several years, farmers and ranchers estimate that crop and range production has been
increased about 25 per cent above production realized by the use of former farming practices. In
addition to the material benefits derived, the conservation work already undertaken has yielded
invaluable information regarding the needs for soil conservation a.p.d the best methods to employ to
achieve most effective results.
Such information can be used to great advantage in planning an expansion of soil conservation
and improvement work. During the war period, the work of the Soil Conservation Service has
necessarily been curtailed and many farmers have been forced to relax established conservation
practices to meet the increased demands for foods, feeds and fibers and because of the shortages of
labor and equipment. Now that the war is over and adequate personnel, equipment and supplies may
soon be available, increased emphasis should be placed upon the planning and extension of an expanded
conservation program.
A good start has been made in solving the problem of maintammg and improving the soils of
the Southwest but much work still remains to be done. Soil conservation programs must be considered
as long range projects requiring the cooperative participation of farmers, agricultural agencies and
8
MONTHLY BUSINESS REVIEW
rural business and financial institutions. Estimates for the State of Texas, made by the Soil Conservation
Service, indicate the magnitude of the task. Over 10,000,000 acres of grazing land need to be cleared
and grubbed; measures of control must be taken with respect to noxious plants on another 10,000,000
acres of grazing land. Of the 66,000,000 acres of land in the State suitable for cultivation, 16,000,000
acres should be terraced, 16,000,000 acres need green manure crops, while cover crops are needed on
9,000,000 acres and strip cropping on 13,000,000 acres. In addition, nearly 28,000,000 acres suitable
for crops are in need of the establishment of systematic rotation. The work remaining to be done in
the other states of the Southwest is relatively as great and programs must be designed and put into
effect for each area.
Programs designed to conserve existing soil resources and to replace elements removed from the
soil must carefully co-ordinate all of the various conservation practices. Soil erosion cannot be
prevented entirely without taking steps to conserve moisture, to improve the soil structure and to
implement scarce, essential elements. Thus, terracing cannot be entirely successful in preventing
erosion if the soil structure, due to the lack of organic materials, does not allow the penetration of
moisture. The amount of organic matter cannot be increased in the soil if some elements necessary
for the growth of plants are lacking. Therefore, it is necessary to plan a complete conservation program
and, further, each program must be adapted to all of the peculiar conditions of the particular area.
A humid area that is subject to erosion will require an entirely different program from that which
would be necessary in a relatively dry, level area. Therefore, in planning a conservation and improvement program consideration must be given to type of soil, topography, climate and type of farming
characteristic of the area. Information of this type for the various sections of this Federal Reserve
district has been assembled and is available from the United States Department of Agriculture.
From such material it is possible to outline, in a general manner, the type of program suitable to
each area. The accompanying map, although not entirely consistent with the following outline, does
indicate the principal conservation and improvement requirements which many believe necessary in
the major areas of this district.
(1) The alluvial area of eastern Louisiana-In tlus area the conservation practices to be
emphasized are those that would improve drainage and aid in protecting the land from
overflow. In addition, such other soil conserving factors as the maintenance of fertility
and prevention of leaching should be given adequate attention.
(2) Northwestern Louisiana, eastern Texas and southeastern Oklahoma-Here, where the red
and yellow clay soils predominate, the problem is mainly one of preventing sheet and gully
erosion. In this area it is necessary to concentrate on the construction of terraces and
waterways and to emphasize the use of strip cropping and cover and green manure crops.
Since the mild climate and relatively heavy rainfall of this area have caused heavy losses
from leaching, heavy applications of fertilizers will be n~cessary in some areas while in
others lime also must be applied.
(3) The prairie region of Texas alld Oklahoma-This region has been subject to damage from
erosion and leaching. In many sections the supply of organic matter has been seriously
depleted, resulting in poor moisture penetration. The soils of this section are inherently
fertile and, in general, are intensively farmed. A program of conservation, therefore, should
emphasize the control of erosion and leaching through contour plowing and the use of
cover crops. Turning under of green manure crops will also be beneficial in increasing the
organic matter content of the soil and in improving the soil's structure. This will allow
better penetration of moisture and will reduce the run-off.
IQ
PRINCIPAL REQUIREMENTS
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ELEVENTH
FEDERAL RESERVE
DISTRIC T
OF CONSERVATION PROGRAMS FOR MAJOR AREAS
MONTHLY BUSINESS REVIEW
(4) The Western Cross Timbers seclioll and the area immediately to the West-These sections
are subject to erosion and, as a consequence, extensive damage has already occurred.
It has been suggested by some who have studied the problem that additional land in this area
should be retired from cultivation and diverted to grazing lands; that pastures should be
improved and measures should be undertaken to conserve moisture.
(5) The Rolling Plains and High Plains of northwestern Texas-This area absorbs moisture
readily and holds it well. Most of the area is productive when adequate moisture is available
but crops are occasionally curtailed or fail becal.lse of drought. Conservation of moisture
is the most essential feature of a conservation program in this area, supplemented possibly by
improved pasture practices, stock water development, and cover crops and crop residue
management to aid in holding the soil in place where the land is in cultivation.
(6) The grazing lands of western Texas and southern New Mexico and Arizona-Here, the
main conservation problem is that of improving ranges and increasing their livestock
carrying capacity. Cultivation is not practiced extensively in the area except in a few
isolated irrigated areas or small valleys. While most of the area is subject to erosion and
leaching, the small amount of rainfall prevents this from becoming a serious problem.
Consequently, the improvement of ranges would probably be adequate to hold the land.
A statement of the physical requirements of a sound conservation program, however, does not
completely picture either the magnitude or the character of the task ahead. In many areas the habits,
customs and attitudes of the people are contributing to the destruction of tile soil rather than to its
conservation. Despite the great efforts, and the progress which has already been made, to acquaint the
public with the principles of conservation, much work remains to be done to educate farmers to realize
the need for conservation and to understand its basic elements before a soil building and conservation
program in the Southwest can move forward on a broad front. The opportunity exists in the educational phase of conservation programming for banks, business and civic organizations, together with
the Soil Conservation Service, the Extension Service, agricultural colleges and other interested agencies
and individuals, to participate actively in disseminating among farmers the facts of the economic and
social importance of soil conservation.
While farmers must accept the largest share of responsibility for carrying out successfully a
program of soil conservation, they cannot be expected to accept full responsibility or initiative in
creating such a program. In a great m any instances, farmers will not have the necessary technical
knowledge and, therefore, must enlist the aid of technicians employed by the various local, state
and Federal agencies who are qualified to give technical advice and guidance. Moreover, in the majority
of cases the financial and material facilities of farmers will not be adequate to complete the task
successfully. Therefore, banks and business organizations and institutions in the communities affected
have the opportunity to assist farmers in meeting the capital requirements of the program.
In each community all groups have a vital interest in the economic well-being of their community
and the communities with which they do business. In rural communities bankers and businessmen
are fully aware of tile primary importance of agricultural credit ·t o the soundness of their businesses
and the volume of their operations. Moreover, many urban organizations recognize that the success
of their operations is significantly conditioned by the economic strength of agricultural areas.
From a purely practical point of view, support of soil conservation programs offers several clear
advantages to bankers operating in agricultural areas. In the first place, sound soil conservation measures
offer the greatest possibility of conserving and, in many cases, replacing the most important capital
resources of those engaged in agricultural activities. Although it is probably not possible to measure
MONTHLY BUSINESS REVIEW
the extent statistically with accuracy, the dissipation and improper use of the soil in the South and
Southwest has surely been a most important contributing factor in the decline of many agricultural
communities and in the generally lower levels of incomes which have characterized agricultural areas
so frequently in the past.
Secondly, by preventing the destruction of the soil and the depletion of the farmers' principal
capital asset, bankers tend to preserve and strengthen the quality of the basic asset underlying their
agricultural credit advances. Moreover, by maintaining the productivity of the soil at a high level,
thus contributing to agricultural prosperity, an orderly, sound liquidation of bank credit is more nearly
assured; losses through forced liquidation of underlying assets will tend to be minimized.
Thirdly, even though current liquid assets of farmers are very large, it is improbable that many
farmers would be able to finance a sound soil conservation program without some financial assistance.
Therefore, bankers are offered the opportunity of expanding their loans for agricultural purposes
at a time when such loans are comparatively small in amount and when bankers generally are actively
seeking new loan outlets.
In making loans for conservation purposes, however, banks should not deviate from sound loan
practices. Unless a bank making such loans has an officer on its staff capable of planning the technical
aspects of the conservation program and able to estimate the anticipated increased net return to the
farmers as a consequence of the conservation expenditures, it probably will desire to avail itself of the
technical advice and assistance of a qualified agricultural agency. In most cases it is unlikely that a
conservation program for an individual farm can be put into effect and completed within one or two
years. Instead, the program generally must involve planning of at least an intermediate term character.
It may be that the increase in productive yields and the net return to the farmer will not be reflected
in the first or perhaps even the second year the program is in operation. It is important, therefore,
that the general program be thoroughly sound and have the approval of those who are qualified to
serve as experts in this particular phase of agricultural development.
Since soil conservation loans generally will need to be of several years' m'aturity, a sound schedule
of amortization payments should be worked out. Such payments should be related to the borrower's
estimated n~t increase in returns as developed in the conservation program underlying the loan in
order to place the payments within the range of the borrower's ability to pay. In this connection,
it has been suggested by some who have studied the question that repayments during the first and
second years be nominal or not required, but that quarterly payments be initiated at approximately
the time at which the effects of the conservation expenditures begin to become apparent in the net
increased return to the farmer.
In view of the extended maturity which is one characteristic of term loans, the factor of management of the borrowing business or property always is especially important to the lending institution.
This fact will apply with equal force in the case of soil conservation loans. The banker must be assured
that the farmer undertaking the conservation program is capable of carrying it out to a successful
conclusion. Proper safeguards should also be taken to protect the bank against loss in the event of
foreclosure .or against a shrinkage of the farmer's assets through improper management practices.
In concluding, it must be emphasized that this article is not designed to outline any of the
specific details or techniques of a soil conservation loan program. Its purpose is to call attention to
the importance of the principles of soil conservation, the need for the development of a sound soil
conservalion program in the Southwestern area, to suggest the part that bankers might take in the
initiation and development of such :l program and to point out a possible outlet for an expansion
of agriculLural credit on a sound basis by bank loans in rural communities.
'I
8
MONTHLY BUSINESS REVIEW
DISTRIC'f SUMMARY
Department store sales in this district during October increased by more than the usual seasonal amount. The 20 per
cent increase over the conesponding period of 1944 was the
largest for any month since January. Sales of furniture stores
were also substantially larger than in either the preceding month
or the same month last year. Petroleum production and refinery
operations in this district have recovered sharply from the low
levels reached early in October and are at the highest level in
about two months. Construction contracts awarded in this district also increased in October and are materially higher than
the low level prevailing a year ago. Heavy general rains during
late September and the first half of October provided much
needed soil moisture in most of the district and stimulated the
growth of small grains and range vegetation. With better
grazing conditions, livestock have improved and animals are
going into the winter in generally good condition. Prospective
production of some major crops declined during October. The
open weather prevailing since mid-October has enabled farmers
to proceed rapidly with harvesting operations.
BUSINESS
Consumer buying at department stores in this district showed
a further acceleration during October when sales of reporting
firms exceeded those in the preceding month by 18 per cent and
were 20 per cent higher than those in October last year. This
is the largest year-to-year gain since January and compares
with an average increase of 13 per cent for the first ten months
of the year. Although a strong demand was evident for virtually
all classes of merchandise during October, buying was especially large in certain items of women's apparel and accessories,
men's wear and home furnishings. On the basis of data furnished
by weekly reporting stores, it appears that the high sales volume is being maintained during November.
brought about by the return of discharged servicemen to civilian
life. As in the case of department stores, the expansion in sales
is contributing to the difficulties of furniture stores in accumulating inventories. At the end of October, stocks were about
the same as a month earlier and slightly lower than a year ago.
AGRICULTURE
The open weather prevailing since mid-October has been generally favorable for harvesting and other field work but frosts
occurring late in October in the western and northern parts of
Texas halted the growth of late sorghums, cotton and summer
range grasses. Indicated production of cotton, corn, peanuts and
pecans on November 1 was below that a month earlier; the estimated rice production was slightly higher and all other field
crops remained unchanged. Some difficul ty is being experienced
in securing adequate labor for the completion of the cotton
and peanut harvest. The seeding of small grains is nearing completion and the crop is making good growth.
The United States Department of Agriculture forecast a cotton crop of 9,368,000 bales on November 1 for the United
States. This is 111,000 bales below the October 1 forecast and
is nearly three million bales below the 10-year (1934-1943)
average. The indicated yield declined from 260.7 pounds per
acre on October 1 to 249.7 pounds on November 1. Only 5,153,639 bales of cotton were ginned prior to November 1 this year,
WI10LESALE AND RETAIL TJU.DE STATISTICS
Retail trndc:
Department stortS :
Tolal 11 th Dist. ....
OnJlas . ...... ... ..
ForL Worth ........
Houston ...........
San Antonio .......
Shreveport, L1. .... •
Other cities ........
Retail furniture:
TI,e continuance of the high level of sales, the strong demand
for scarce items and the persistent lag in the output and delivery of of long-awaited merchandise appear to have aggravated
the inventory difficulties of department stores in this district. At
the end of October, the value of merchandise stock, although 6
per cent greater than a year ago, was 4 per cent lower than at
the end of September. Moreover, the supplies of merchandise on
hand are badly distributed among departments. In some of the
soft-goods departments, current stocks arc equivalent to less
than one month's sales, but in other departments stocks are very
high in relation to sales. As a result of the heavy sales of men's
clothing and furnishings, stimulated by the requirements of discharged servicemen, supplies have declined and are substantially
lower than a year ago. The scarcity of piece goods, together with
the poor assortments, is curtailing purchases of those items.
\'V'hile the flow of hard goods into trade channels is increasing,
the volume is still small and due to the heavy deferred demand,
merchants are experiencing difficulty in accumulating stocks.
Furniture store sales showed a further increase of 11 per cent
from September to October and were 23 per cent larger than in
October last year, reflecting in large part the increased demand
Total 11th Dist. ....
Dallas .... ........
Ell'aso .. " .......
Houston ..... , .....
Port Arthur .......
San Ant-onio .......
Shreveport. La. . ...
Wicbita Falla . . . ...
Independent stores:·
Oklahoma, ... . . ...
Texas ............ ,
Wholesale trade:·
Drug, (incl. li~uors)
~Icctri~al supp iCH.,
GrocerIes .. ' . . ..
lJardware .... ... : :
,
Percentage change in
Number ;
Net sales---v-Btocks 1---..
01
October 1945 from
Jan . 1 to
Oetober UI45 fram
n:!porting October
Sept.
Oct. 31, 1945 October
Sept.
firms
19-t4
1945
from 1944
1944
1945
48
7
+18
+15
+17
+20
+20
+13
+18
+13
+16
+12
+6
+23
+6
+10
+6
+6
+1
+7
+29
- 4
-2
- 12
+2
- 4
22
+20
+24
+19
+10
35
+8
+16
- 7
- 4
57
5
3
7
3
3
3
3
+24
+34
+17
+25
+2
+26
+27
+31
+31
+24
+52
+23
+46
+39
+32
+44
+t
+16
-8
+1
+5
-6
-3
-I
316
910
+20
+22
+17
+ 16
+11
+11
10
3
23
9
+5
+21
+12
+ 16
+13
-5
+9
+i
+S
-IS
+ll
+is
+3
4
7
6
3
+55
+13
+9
Compiled by United Statea Bureau of Census (wholesale trade figures preliminary).
tstock:J at end of month.
flndicates change less than one-balf of ODe per cent.
INDEXES OF DEPARTMENT STORE SALES AND STOCKS
Daily
sales-(1935·1939-100)
Unadjusted·
Adjusted
August October October Sept.
October Sept.
August
1945
1945
1946
1944
1946
1945
1945
273,
292
237
District ..... 318·
289
278
272
227
264
Oal138 .. ... . 323
.63
294
273
267
221
283
Houston ... . . 300
269
273
226
2.\1
av'''g.
Oct~ber
1944
24&
240
267
Stocb-(1935-1939~100)
- - -- Unadjustro·--::-,..,..~-:--:---::-Adj"'ted----:-_
October Sept.
August October October Sept.
August October
1945
1945
1945
1944
1945
1945
1945
1944
District.. ... 212
231
212
199
IS8
206
187
176
·Unadjusted for scasooal "nriation.
-Revised.
MONTHLY BUSINESS REVIEW
as compared with 8,282,768 bales ginned prior to this date in
1944. A cotton crop of 1,880,000 bales was forecast for Texas
on November I, representing a decline of 120,000 bales below
production indicated on October I and compared with the 10year average of 3,112,000 bales. Indicated yield for Texas was
145 pounds per acre, as compared with a yield of 154 pounds a
month earlier and an average yield of 160 powlds. Ginnings in
Texas prior to November 1 amounted to only 1,144,000 bales,
as compared with 1,576,000 bales at the same time last year.
Cotton ginned so far this year is slightly lower in grade than
that ginned during the same period last year but the staple length
averaged more than 1/ 32-inch longer. The proportion of ginnings reduced in grade because of rough preparations continued
to fall below that of last season.
Prospects were reduced throughout Texas with the exception
of the southeastern coastal counties where the indicated crop on
November I was slightly higher than the forecast of a month
earlier. The rains of late September and early October, covering
most of the State, seriously reduced the rate of harvest and resulted in loss both in quality and quantity of production.
Weather conditions after mid-October were generally favorable
over most of the State but intermittent rains and heavy dews
in the northeastern and north central counties interferrcd with
harvesting and freezing temperatures in the latter part of October in the northwest caused some loss in prospective production
in the late planted acreage. In spite of relatively favorable
weather conditions during the latter part of October in Oklahoma and Louisiana, harvesting has tended to lag and some cotton still remains in the fields in the northern part of Louisiana
and over mOSt of Oklahoma.
season was somewhat smaller than usual and growers have shown
a tendency to delay shipments of fruit, especially oranges, to
gain the advantage of the better fruit sizing resulting from the
improved moisture situation. The quality of the fruit has been
good compared with the usual quality of early season production.
\Veather conditions prevailing during October over most of
the Texas commercial vegetable areas were conducive to crop
growth and seed germination, although part of the non-irrigated Coastal Bend district is suffering slightly from lack of
moisture. Open weather has enabled growers to clean some crops
that were becoming weedy. Insect damage has been less than
usual. The indicated production of 5,320,000 bushels of spinach
compares closely with the ten-year average harvest. Beet production, estimated at 1,370,000 bushels, is expected to be about
50 per cent ab(we average. The eggplant harvest is in progress
over most of the area with good yields reported . Since tomato
plants did not hold the set indicated on October I, yields are
expected to be below those of last year. The outlook for Texas
cabbage is generally favorable but heavy shipments are not
expected until the last half of December.
Due to the marked improvement during October, range conditions in this district are generally good, except in southern
CASII FARM INCOME
(Thousands of dollars)
__ August 1945 -.....~----Total receipts
_Receipts from-----.. August
Crops Lh'estock·
1945
1.257
2,654
3.911
4.239
5.772
10,011
3.441
3.845
7,286
15.146
26,230
41,376
40.136
40.958
81,00'
Arizona. . . . ..
~~~s~~!ico~ .
Oklahoma . .
TCX:BS
Total
The indicated corn production for Texas on November 1 of
66,048,000 bushels was about 2,000,000 bushels lower than that
a month earlier and compares with last year's crop of 69,622,000
bushels and the 10-year average of 77,427,000 bushels. Heavy
rains during October damaged the crop, reducing yields below
early season expectations. The indicated production 0'£ grain
sorghums remains the same as a month ago at 68,130,000 bushels, an average yield of 15.0 bushels per acre. Harvesting is about
complete except on the High Plains where combining has become widespread following late October frosts. The rice harvest was completed in some areas by November I and was generally well advanced in all areas; prospects inlproved during
October and the indicated production on November 1 was 17,600,000 bushels, an increase of 400,000 bushels from a month
ago. The estimated pecan crop of 32,500,000 pounds on Novem.ber 1 was 1,500,000 pounds below the estimate for the previous
month. The peanut crop was damaged by the heavy rains and
harvesting was retarded by shortage of labor. The current estimate of 358,200,000 pounds is about 10 per cent below that on
October I. The indicated production of all other field crops
remained unchanged from a month earlier.
A record production of 24,000,000 boxes of grapefruit and
4,800,000 boxes of oranges is forecast for Texas, representing
increases of 8 per cent and 9 per cent, respectively, over last
year's production. The size of the fruit at the beginning of the
9
64,219
79,459
..
August January I to August 31
1944
1945
1944
3,848
91,050
87.249
9.449
96,508
92.874
6.269
.7.290
41,291
58.842
271.060
280.186
91,033
681.994
605.065
143.678
170,041
1,188,007 1.156.655
-Includes receipts from the sale of lovestock and livestock products.
SOURCE: United States Department of Agriculture.
LIVESTOCK RECEIPT8-(Numb,,)
~--Fort Wortb, ---~---
Octcber
Cattle ..
CIIolves.
HOglJ .•
Sheep ............. .
October September Oetober
1946
101,387
91,783
12,500
125,033
1944
117,182
79,207
54,495
166,802
19'5
94,727
",,228
13.521
222,713
San Antonio - -October September
1945
32,375
54,389
5,084
43,711
1944
34,441
50,261
12,937
40,172
1945
30.352
51.994
5,107
100,907
COMPARATIVE TOP LIVESTOCK PRI CES
(Dollats per hWldrcd wcighL)
~--Fort \Vortb- - --
-
-
October
Beef sf,c(ora ... . . .
Stocker steers . .... ...... .
Heifcl'8 and yearlings ..• ..
Butcher cows.
Cnlves ............ .
E:'£"b.;.:: ::::: :
Cktober September Oetober
1945
$15.25
13.50
15 .25
13 .00
13.60
14.65
13.00
19.4
$15.00
12 .50
15 .00
11.50
13 .00
14 .55
13.50
19'5
$15.75
13.25
15 .75
12.50
13 .00
14.55
13.00
San Antooio - - October September
1945
$15.50
1944
$12.75
1945
113.25
14 .00
12 .75
11.00
12 .90
14 .25
13 .00
11.50
13 .00
14 .55
10 .25
11.50
13 .50
14 .65
11 .75
ii25
CROP PRODUCTION-{Thousantis of units)
- - - T exas
Crop
Cotton ........
Winter wheat . .
Unit
Bales
BUHbels
Estimated
Nov. 1, 1945
1,880
37,88 1
66.648
.3.540
5.015
1944
2.646
74,746
69.622
38,600
10.780
1.526
Eleventh DistrictEstimated
Nov. I, 1945
1944
2.366
38.617
Bushels
BO,147
Bushels
'8.705
Bushels
10,585·
Barley .. ... ...
Tame hay .....
1,511
2.080
To""
.'i,OI(\
Bushels
5,022
Potatoes. frish.
5,832
Bushels
.ri,025
Potatoes. sweet .
4.350
15. 672
17,600
HI,208
40,3M
Rico .... .. ........... . Bushels
-Arizona. New Mexico. Oklahoma and Texas.
tLouisiana. Oklahoma and
1Louisiana and Texas.
SOURCE: United States Depurtment of Agriculture.
Corn.
Oab.
1
3.360
7S.775
82.D16
44,159
18,478+
2.115
0,010
14,I6.\t
41,3681
Texas.
10
MONTHLY BUSINESS REVIEW
New Mexico, where conditions arc poor to fair. Despite the improvement, grazing conditions in south Texas and in some other
limited areas continued below average. Small grain pastures in
the Panhandle are furnishing considerable grazing and cattle
in substantial numbers are being moved to the grain fields. Range
conditions in Oklahoma arc well above average, with wheat pastures limited to local areas. Ranges in southern Arizona arc
slightly better than average. Total feed supplies for the nation
appear to be adequate with supplies per animal unit slightly
larger than last year, but the late winter wheat pastures and the
smaller production of cottonseed, bundle feeds and grain sorghums in the Southwest may reduce feeding operations in this
area.
Reflecting better grazing conditions, cattle and sheep generally have likewise shown noticeable gains and are going into
the winter season in good condition, the principal exception being in southern New Mexico where the condition of stock is
considerably below average. The large supplies of soft corn in
~the leading corn belt feeding states induced a stronger demand
for stocker and feeder cattle and lambs during October, and record movements into these areas-including both market and
direct movements-were registered for the month. Total receipts of cattle at the twelve major markets, including cattle for
slaughter and for movement to feed lots, were 1,566,000 head
in October, compared with 1,464,000 head for the same month
last year. Total calf receipts were 414,000, as compared with
398,000 in October, 1944, but receipts of sheep and lanlbs
totaled only 1,389,229, as compared with 1,704,441 for the
same period last year. Receipts of hogs continued to fall far
below last year. These total receipts at the twelve major markets
do not include stocker and feeder cattle and lambs moving directly from producers to feeders. At Fort Worth, cattle receipts
in October increased over September but continued below those
in October last year; receipts of calves were greater than for
September or for the same month last year, while receipts of
sheep fell far below last month and well below October, 1944.
The mid-month local market price report of the Department
of Agriculture showed an even to slightly upward trend in
prices received by Texas farmers during the month ended October 15. Prices of potatoes and rice rose significantly while those
of lambs, hogs and hay had moderate rises. Beef cattle prices
declined moderately and prices of sweet potatoes and cotton
declined very slightly. Prices of sheep, grain sorghums and cottonseed remained unchanged.
CONDITlON STAT ISTICS OF WEEKLY REPORTING MEM1lER BANKS
IN LEADING CITIES
(Thousands of dollars)
Nov. 14,
~:~St:t~'G~~~~~~~i d~POOi~:::::: : ~ : ~ ::: ~: :. ~~~:j~~
DEBITS TO L'lDIVlDUAL
ACCOU~TS
(Thousands or dollars)
Abilene ..... .
Amarillo .....
Austin .......
Beaumont . .. "
Corpus Christi
Corsicana ...
Dall.... ~ .. ~~
EI Paso . ... ".
I<'ort Worth
Galveston. ............
Houston ....
Laredo . ..
Lubbock~. ~. ~
Monroe, La .......
Port Arthur ......
H08weU, N. M..
San Angelo .....
San Antonio ......
Shre\"cport, La ...•
Teurknoa· ...
Tucsoo, Ati! ... " ..
~~::::::::::::'.
Wichita Falls .... . ...
October
1945
19.240
49.790
7<.394
57.679
57.066
7,771
549.922
72.074
203.803
44.587
553,412
11 ,696
31,037
22,727
18,{l47
9,914
19.483
1G9,360
79.'39
18,834
3',747
311.510
36,125
34,592
Total- 24 cities ....... .. $2,207,239
October
1944
18.716
43.856
73.003
5<.871
52.126
7.023
548.691
61,520
207,289
4:1,735
534,674
11 ,472
29,536
18,896
21,873
8.788
14,887
140,113
81,373
22.006
28,006
22,702
29,872
26.948
Pctg.chsDge September Pctg.chsllge
over )'car
1945
ovcr mODth
17,200
+3
+12
41,056
+14
+21
71,147
+1
+5
53.950
+4
+0
-4
59.488
+8
6.883
+ll
+13
491,147
+12
+1
58.510
+18
+24
-2
193,128
+6
41,792
+2
+7
559,987
-1
+4
11.199
+2
+4
27,532
+5
+13
18,549
+20
+23
-13
20,722
-9
8,285
+13
+20
18.959
+31
+3
155,427
+21
+9
-2
76,547
+4
-14
17.165
+10
31.124
+24
+12
+34
23.650
+29
27.736
+21
+30
+28
30.239
+14
---
12.103,536
12,061.422
+ 5
+ 7
-lncludes the figures of two bunks in TemrkanB, ArknnSl\S, located in the Eighth Di.!Itrict.
tJndicn.tes change less than one-half of ODe per
C(!1It.
GROSS DEMAND A~D TIME DEPOSITS OF ME~!BER BA.'lKS
(Average daily figures-Thousands or dollars)
Combined total
G,,,,,,
demand
October 1943 ......... $3,181.242
3,705.142
Ocl.obc. 1944 ...
1945 .. ....... 4.299.715
JUIIC
July
1945
. 4,481,169
A\Ig1I5I
1945 ~ ~.
.4,504,m
September 1945
. 4,518,798
October 194 5
...• ,562,119
FINANCE
Time
$248.606
324.328
409.205
398.157
417,936
438.792
438,196
Reservf' city banks
Country banks
G"",
G,...
dema.nd
Time
demand
Time
$1.70M87 1148,123 $1.476.655 1100.483
1.920.004 203,792 1.785, 138 120,536
2.189.248 263.505 2,110,467 145.700
2,306,773 249,764 2.174.396 148.393
2,293,633 21>5.659 2.210.571 162.277
2,276,21» 281.535 2.242.533 157.257
2,290,933 27B.991 2,271.186 159.205
SAVL'lGS DEPOSITS
The most impprtant factor affecting financial actLvltles in
this district during recent weeks has been the Victory Loan
Drive which began October 29 and will continue through De-
October 31, 1945
Beaumont ...
Dan.. ....
CONDITION OF THE FEDERAL RESERVE DANK
(Thousands of dolbrs)
Nov. 16,
Nov. Hi,
1045
ToW cash rcacrve.s ..... ... . . . ... . . . . . . . . . . ... ... .
Di~counta for member banks ..... .
Foreign IOKDS on gold ..... .
U. S. GOVCMllCcnt securities.
. ............ . . .
Total carllin~ assets .. . .......................... .
Member ba.nks reserve deposib3 ..•.................
Federal Rc5Cn'e Notes in actual circulation ..... .. .. .
Nov. 15,
1944
11,563,040
363. 171
255,694
2.098
37,362
21,140
160
47.017
1.200.169
78.878
360.145
216.247
480.514
20,434
43,95 1
3.18.549
226,230
1,198.053
208.936
119,001
557,133
None
October 10,
1945
$1,870.258
448.405
28fJ,751
4,452
68,887
25,840
305
50,110
1,421,853
69,328
307,208
278,742
020,045
8113
55.577
394,1l9
245,406
1,345,723
273,985
215,139
Interbank depooits..... . . . . . . . . . . . . . . . . .
646,434
591.560
Borrowings from Fedcral Reserve Bnuk. . .
None
None
-lncludes a11 demand deposits other than interbank: nod Unit.cd Slates Government, less
cash items on hand or in process of coHection.
1945
Total loans and investment!. . . .
. ............ '1,078.380
Total loans ... , .. ,..........................
527,185
Commercial, industrial, and a~icuJtura1loans. .
323,791
Loans to brokers and dealers In SC('uritics... .. .
6,4-48
Otber loans for purchasing or carrying securities. .
102,829
Real estate loans........
27,023
Loans to banks..... .
.. . .
308
All other loans. . . . . . . . . . . . . . .
00,786
Total inye~--tmenta......... . ......... . .....
l,4lil,201
U. S. Treasury bills.. .. .. . .. .. .. .. .. . . .. ..
76,373
U. S. Treasury certificates of indebtedness..
(02,01 {I
U. S. Treasury notes ... ".......
293,351
U. S. Government bonds. .. .. .. .. .. .. .. .. .. .
620,352
Obligations guaranteed by United States Gov't .
863
Other securities. . . . . . . . . . . . . . . . . . . . . . . . . . . .
57,340
Reserves with Federal Reser-ve Bank....
405,934
Balances with domestic banb ................ ,',...
257,004
DemaDd deposits-adjusLed·............ . ... . ..... 1,389,725
1944
Oclobc. 15.
1945
S495M1
200
1.410
910.960
912.570
749.420
623.622
1562.623
353
Noue
63 1.959
632.312
627,764
531.462
1483.654
200
300
892.702
893,232
716,337
616,142
E1P.........
Fort Worth ...
Galveston.
Houl;ton
Lubbock .....
"Port Arthur . ..
SRII Antonio ...
Shreveport, La..
Waco .. _. _...
\vichilll Falls ..
.'\lIotll('r ...
Total ...........
Kurnber
reporting
ba.nks
3
8
2
3
4
9
2
2
5
3
3
3
57
104
Number or Amount or
savings
savings
depositors
depositB
12.368 $ 7.436,196
126.757
65.081.189
26.713
20.054.100
39.093
29.895.775
23,024
18.751.418
61,853.550
91.936
712,lHI
846
5,825
5,202,545
34.545
30.221.207
32.3&2
24,150,554
8,950
8.270.240
7.146
4,770.928
46,22 ••286
58.220
467,1IO~
$331,640,167
Percenta.5e change in
salingS eposits (rom
Oct.31,
1944
+24.7
+36.5
+37.9
+35.0
+21.2
+26 .4
+33.1
+25 .6
+32.6
+34~9
+36.0
+21.3
+30~1
+31.4
Sept. 30,
1945
+1.4
+ 2.3
+ 2.0
+ 2.0
+ 1.2
+ 1.7
+ 7.8
+ 2.0
+ 1.6
+1.Q
2.8
+
+
1.5
+ 2 .2
+ 2.0
11
MONTHLY BUSINESS REVIEW
cember 8, with savings bonds and Treasury savings notes processed by the Federal Reserve banks through December 31 to be
counted toward the drive. Although the $11,000,000,000 National goal for this drive is considerably lower than the $14,000,000,000 to $16,000,000,000 goals of other recent drives, the
hrge volume of subscriptions being received in this district is
exerting the customary influence upon financial developments.
Following the pattern characteristic of other drive periods,
the deposits of weekly reporting member banks in this district
increased sharply after the opening of the Victory Loan Drive,
with all classes of deposits participating in the increase. In consequence, totaJ deposits increased by $133,280,000 between
October 10 and November 14, reaching a new high level of
$2,5 66,000,000 on the latter date. This expansion in deposits
was utilized by reporting banks to increase their reserves with
the Federal Reserve Bank by $11,800,000, their balances with
correspondent banks by $12,200,000 and their loans and investments by $10 8, 100,000.
The $7 8,780,000 increase in total loans of reporting member
banks between October 10 and November 14 reflected both the
seasonal increase in loans to business and the extension of loans
associated with subscriptions to Government security issues being offered during the Victory Loan Drive. Loans to brokers
and dealers and to others fo·r security trading, the major portion
of which is secured by Government obligations; increased by
$35,9 00,000 during the five weeks, and the total of $109,300,000 on November 14 was about the same as the previous peak
reached at the close of the Seventh War Loan Drive. Although
commercial, industrial and agricultural loans usually increase
at this season, the large increase of $34,000,000 which occurred
chiefly in the first two weeks of November suggests that regular lines may have been utilized to obtain funds to enter subscriptions for drive securities. Moreover, flaIl other" loans increased by $7,700,000 during the five weeks, or by an amount
somewha t larger than usually occurs in such loans.
reserve balances, with the result that excess reserves declined
from $148,000,000 to $109,000,000 during the same period.
The circulation of this bank's Federal Reserve notes rose to a
new peak of $624,000,000 on November 14, but the net expansion of about $7,000,000 during the preceding thirty days
was the smallest for any similar period since April this year,
Although Federal Reserve note circulation usually shows a seasonal expansion during the fall months, the expansion during
the past three months has been much smaller than during any
corresponding period since 1941.
INDUSTRY
Information released by the War Manpower Commission
shows that 96,000 johless persons were registered with the
United States Employment Service in Texas early in November,
and that 40,000 job openings were on file with that agency.
These figures, of course, do not represent the total number of
unemployed persons or of jobs available since many persons seeking employment are not registered and management no longer
is obligated to file its lnbor requirements with the Employment
Service. The discharge of servicemen is becoming a more significant factor in the employment situa tion. It is estimated
that 60,000 Texans were released from the services in October,
which is twice the number discharged in September, and a
further acceleration is anticipated during the next few months.
Although an excess of applicants over registered job openings
is fairly general over the State, the excess is mo.t pronounced in
Dallas where there was an excess of 7,750 at the middle of November. Amarillo was the only major manpower area in the
State reporting no excess labor; however, the United States
Department of Labor, in its classification of labor market areas,
listed Austin, Beaumont, EI Paso, H ouston and San Antonio
as cities in balance.
Between October 10 and November 14, the investments of
reporting banks were increased by $29,400,000, largely offsetting t he reduction that occurred during the preceding four
weeks. About one-half of the increase occurred in holdings of
Treasury notes and most of the remainder occurred in holdings
of Treasury bills and certificates of indebtedness. Holdings of
Treasury bonds showed little change during the five weeks and
on November 14 were about $15,000,000 under the peak
reached early in September.
Although the production of crude petroleunl and refinery
operations reached a low level early in October due to the strike,
output increased sharply following the resumption of operations. Crude oil production during October amounted to 1,700,000 barrels daily which represented a decline of 322,000 barrels,
or 16 per cent, from the September output, but by early November the daily rate had increased to approximately 2,063,000
barrels daily, the highest since early in September. In view of
the anticipated demand for crude oil, the Texas Railroad Commission increased substantially allowables in Texas for November
and made a further upward adjustment for December.
The average reserve balances of member banks in this district
continued to expand during October and the first half of November, reaching a newall-time peak of $736,000,000 in the
latter period. Following the Seventh War Loan Dri';e, the transfer of funds from Government war loan accounts to the deposit accounts of individuals, partnerships and corporations increased the reserve requirements of member banks with the result
that average required reserves rose from$522,000,000 in the first
half of July to the newall-time peak of $604,000,000 in the
last half of October. During most of this period the increase in
required reserves was more pronounced than the expansion in
In this district, the curtailed operations in the early part of
the month had the effect of reducing October crude oil runs
to refinery stills to an average of 1,125,000 barrels daily. Thi~
figure, however, was only 5 per cent less than that during the
previous month, since Texas Gulf C<>ast refineries quickly
achieved normal production after resumption of operations.
Crude oil runs in the Texas Gulf Coast area reached 93 per cent
of capacity during the week ended October 27, as compared
with approximately 27 per cent three weeks earlier. At the end
of October crude oil runs to refinery stills in this district were
averaging more than 1,450,000 barrels daily, which was only
12
MONTHLY BUSINESS REVIEW
about 120,000 barrels daily lmder the wartime peak reached
at mid-August. Crude oil runs in the United States averaged
4,234,000 barrels daily during October, or 200,000 barrels in
excess of production; consequently, the September and early
October increase in crude oil stocks has been largely eliminated.
Total crude oil stocks on November 10 had declined 7,550,000
barrels from 227,554,000 barrels on October 13, the highest
level since July, 1944. About two-thirds of the decline in stocks
between October 13 and November 10 occurred in tlus district.
more than during the preceding month and the highest for
October since 1942. Moreover, total construction awards in tlus
district for the first ten months of the year, amounting to
$226,000,000, were 68 per cent above the total during the same
period last year. In comparison with the preceding month, residential awards rose approximately 50 per cent, but the larger
public works and utilities awards in Texas accounted for the
major porrion of the gain.
Drilling activity in this district increased slightly during
October, with an average of 23 well completions daily, whereas
completions declined I I per cent in the areas outside this dis-.
trict. Approximately 19,700 wells were completed in the United
States during the first ten months of 1945, an increase of 10
per cent as compared with the same period in 1944, but
materially below the 26,400 completions during the first
ten months of 1941. In the Eleventh District over 6,700 wells
were completed during the first ten months of this year, or a 19
per cent increase over completions during the comparable period
of 1944, but 40 per cent fewer than during the same period
in 1941. While the percentage of completions thus far in 1945
represented by dry wells was smaller than during the comparable period of 1944, it was larger than during the first ten
months of 1941.
CRUDE OIL PRODUCTION-(BRrrels)
October tg45
Increase or decrease in daily
average production from
TRial
DailyaVI·
production
production
Oclober 1944
Sept. 1945
North Texas ...............• •
216.142
6.559.400
- 3:(337
- 14.270
West Texas ....•............. 10.883.6.\0
351.086
-140.674
- 87.016
East Texas .. ............... . 11.318.700
3M.119
-165.271
- 71.784
&uth Texas . ..... ...... .. .. .
7.584.260
2«.663
- 90.444
- 41.495
Texas Coastal. . .. ...... .. . .. . 11.023.060
355.682
-182.989
-102.693
During October cotton consumed by Texas nUlls totaled
15,666 bales, representing increases of 7.5 per cent from that
in September and of 4.9 per cent as compared with that in
October, 1944. While this is the firSt increase in the year-toyear comparison since June, 1943, consumption during the first
ten months of 1945, which amounted to 161,200 bales, was
only 3.7 per cent smaller than during the corresponding period
last year.
A late harvest, combined with the shortest Texas cotton crop
in over fifty yeal'S, resdted in a 30 per cent decrease in receipts
of cottonseed at Texas nulls during the first three months of the
current crushing season, as compared with the same period of
1944. The three months' receipts of 337,000 tons were the
lowest of record. Although Texas stocks at the beginning of
the current season were the highest in eight years, the small
receipts thus far this season, together with larger crushings than
a year ago, have resulted in holding stocks on October 31 at a
level one-third below last year, and the lowest for that date
since 1919. Moreover, it appears that Texas mills have received
about 50 per cent of the State's estimated cottonseed production. Shipments of cake and meal from Texas mills during the
current season have been larger than a year earlier while shipments of hulls have been smaller. On October 31, Texas mill
stocks of cake and meal were 30 per cent lower than a year
ago and the lowest of record for that date. The relatively low
level of cake and meal stocks and smaller production in prospect
during the remainder of this season are causing some concern
among Southwest feeders over the potential shortage of feeds
during the winter months.
The value of construction contracts awarded in this district
during October rose to $23,770,000, which was 39 per cent
Total Teus .••.•.•
Mexico ................ .
North Louisiana . .. .......... .
~ew
47.479.0.l0
3.0M.300
2.187.860
1.631.582
98.526
70.576
-flOl.715
- 5.944
- 2.826
TRtal Diatrict...... 52.721.200
1.700.684
-610.'85
SOURCE: Estimu.~d from Americnn Petrnleum Insititute weekly reports.
-317.258
4.104
.97
--321.859
VALUE OF CONSTRUCTION CONTRACTS AWARDED
(ThoUS3nds of doUan)
October
October
September January 1 to October 31
19415
1044
1045
1015
1944
Eloven th District-total... $ 23,770
S 10,498
S 17.116 1 225.204 1 134.364
Residelltial. .. . • . . . . . . .
4,438
1,517
2,979
32.410
21.527
.A.llotbcr .. . ... . ... . . ..
19,332
8,981
14,131
193,794112,837
United States*-total.....
316,571
144,845
278,262
2.598.631
1.640.685
Residential. . . . . . . . . . . .
59,886
23.805
42.680
388.959
301.253
All other. .• .•.• ... •. •.
256,685
121,040
235,1)82
2.209.572
1.339.432
~7 states east or the Rocky Mountuins.
SOURCE: F. W. Dodge Corporation.
Abilene ..........
Amarillo .. .......
Austin ...........
Beaumont •.....•.
~f: ~.b.r~.t~: : : :
EIP........
ForL Wodh ..
GulvcsLon •...
Howton .....
Lubbock ..
Port Arthur ...
San Anklnio ......
Shreveport, la....
Wueo ............
Wic1lit.a Fulls ..
BUILDum PERMITS
Percentage change
Percentage
Oclober 1945
nluation from
Jan. 1, to Oct. 31, 19'.15 cha~e
valuation
No.
Valuation Oct. 1944 SepU9.6 No.
Valuation from 1944
2. 1 '4.050
147 1 618.013 + 86
+816
- 86
141
482,752
1.043
+568
+ 19
2.330.553 +119
233
678.040
+728
2.785.689 +350
+65
1.'54
243
107.272
+ 138
+159
1.65S
1.500.196 :j:I00
100
1.802
'79.501
+ 67
+ 53
3.133.01l
76
956 2.138.'62
+ 42
7.342 10.823.7'1 + 68
+368
121
26Q, 140
+103
- 13
765
1,270,418
1
307 1.007.6O!I
+206
+ 54
3.295
6.152.300 +110
77
81.050
- 86
645
1.214.204 + 29
+ 8
-14
+53
3.647 21.0'6.195 +155
'84 t,823,Qgo
171
408.456
+361
1.389
2.196.046 +130
+ 82
119
85.544
+312
- 37
907
504.463 +125
1.073 1,3ii,514
+ 93
8.611
6.075.441 + 57
+ 15
248
+104
2.161
+289
'73.798
2.300.785 + 98
76
136.8110
+657
- 33
821
1.505.765 + 23
43
94.289
+490
+ 65
432
530.617 +129
-
-----
Total . ..... 4.575 $9,779,957
+165
-+ 12
36.118 164.093.617
+100
C01'T0:lSEED AND COTTONSEED PRODUCTS
~-,---TC183-----v--Ul1ited Stntcs~
Cotton!iCCd received at mills
(10..) ............ ... . ... . .
Colt.o~ Cl'ushed (tone) .... .
Cottout;eOO on band Oct. 31
August 1 to OcLober 31
ThiJ scuaOI1
Lo.Ht season
336.934
477.623
220.136
211.121
August 1 to Octoher 31
Thi6 season
f..nat season
1.532.539
2.400.395
918.003
977.561
(10",,) ................... .
200.997
298.148
832.884
1.5'1.091
Prod uction of products:
Crude oil (thousand 11>5.) ••••
Cake and meal (tons) ..•••..
56.67.
101.861
Hulls (tons) .. . ........... .
50.18'
69.342
61.362
99.'64
49.086
64.992
284.317
403.778
216.964
274.849
294.423
442.343
228.114
281.1100
10.602
17.200
25.231
26.085
12.848
25.117
18.807
29.727
49.903
56.375
68.023
55.978
69.945
Linters (running bales) .•....
Stocks on hand October 31:
Crude oil (thousand 100.) ..
Cake and meal (tons) .•....•
Hulls (tons) . . . ..
....
Linters (running b:Ues) ... .
97,042
46,967
101.732
DOMESTIC CONSUMPTION OF STOCKS OF COTTON-(Dal..)
October
October
Sept.
August I to October 31
1945
1944
1945
'l'hiueason lAst seasOD
ConaumptioD at:
Texaa mills .......... ... .
15,666
14,941
14.674
<47.736
'.18.334
United Stares mills ..... . .
769,806
793,976
701,000
2,200,617
2,425.130
U. S. stocks----end of month:
JII COllSUmill101: C:3tnbm'ts ...
1,912,212
1.971.866
Public utg. compresocs .. 9.230.756 11.984.390
«
MONTHLY BUSINESS REVIEW
DECEMBER 1, 1945
NATIONAL SUMMARY OF BUSINESS CONDITIONS
(Comlliled by the Board of Governors of the Federal Reserve System)
INDUSTRIAL PRODUCTION
~
~"'
It)!
I'WY'S<C ~" CWIIil SlA_~LL~ ~
'"
,<0
~,.
_
~ ,~-
260
I
.11
'\..,..
V
220
200
1
/
180
i\
\
100
~-
60
)
v
INDUSTRIAL PRODUCTION
Output at factories and mines continued to decline in October reflecting a further cuna ilment ir
munitions activity and reduced production as a result of industrial disputes in some industries. Thf
Board's seasonally adjusted index decreased 4 per cent in October and at 164 per cent of the 1935-39
average the index was at the same level as in the middle of 194 L In the first half of November output
in such basic industries as coal, coke, petroleum, iron and sted, and autI.Jmobil~ was above tht
October level.
180
I '0
II
120
220
200
/
/
140
P..40
I
.I -
40
I
/
'0
I 00
60
1917
1936
1939
1940
194!
1942
1943
1944
1945
Federal ReseNc index . Monthly figures, latest
shown is for October, 1945.
DEPARTMENT STORE SALES AND STOCKS
~"
,m
2<0
-
~.~
~"
G,IIIU-H"_
•
t1- ~'..~
I\
,- ,
180
,
1
~,'0
ijll."1
~-V--
''1'"
'00
:\ '
t ~ \J \fV_'v/ - I
'V
'
140
I
V
~
'0
I'0
I00
V) /
c:r~J~
100 ~ "..
60
-,. '-!-\~ I '0
.1,. I \
\Ino<:~s
Jl
120
,~
"0
220
200
Industrial output declined somewhat further in October but in the early part of Novembel
production in important basic industries increased. Value of retail sales continued to advance con·
siderably in October and early Noyember reflecting in part small increases in prices.
80
80
Federal Reserve indexes. Monchly figures, latest
shown are for October. 1945.
WHOLESALE PRICES
--,----,---r--:.::; 140
'T---'-=+-----l 120
Activity in the machinery and transportation equipment industries showed only sma ll decline1
in October in contrast to the sharp reductions in recent months when most of the war production il1
these lines had been terminated. Activity at automobile factories rose substantially in October and
there were also important increases in outpUt of civilian products in other reconverted factories.
Steel production was reduced in October as a result of a temporary curtailment in coal supplie!
but since the end of October steel mill operations have increased considerably. Wage- rate disputes in
the West Coast lumber region resulted in a reduction of 18 per cent in total lumber output in October,
Output of nondurable goods as a group was maintained in October. further reductions in output of explosives and aviation gasoline and other products used for war purposes were offset by
increases in output of many peacetime products.
Output of coal and crude petroleum decreased sharply in the early part of October as a result
of industrial disputes . Since the last week of October production of these minerals has increased considerably; in the early part of November bituminous coal production was at the highest rate since
the spring of 1944.
EMI'LOYMENT
Employment in munitions industries and in Federal war agencies declined further in October,
while in most estab lishments engaged in civilian activities employment incn."ased. Employment at
automobile factories gained about 10 per cent in October. and there were important increases in some
ocher manufacturing lines, in construction, and in the t rade and serv ice indus tries. Employment at
coal mines dropped temporarily as a result of work stoppages.
DISTRIBUTION
Distribution of commod it ies to consumers continued to incre-Jse in October and the first half of
November . Sales at retail stores selli ng both durabJe and nondurable goods were about 15 per cent
higher than a yea r agO. At department stores sales advanced 8 per cent from September to October,
according to the Board's seasonally adjusted index, and, On the basis of the rate of sales during the
first half of November a new peak is indicated this month.
Railroad shipments of revenue freight have increased since the early part of October, although
they usually declin e during this season, and in the middle of November they were almost as large as
in the same period a year ago. The increased number of carloadings has reflected a sharp rise in coal
sh ipments since the mincrs have gone back to work as well as a steady expansion in shipments of
merchandise for civilian use.
COMMODITY PRICES
Wholesale prices of farm products and foods continued to advance from the middle of October
to the middle of November and reached the previous peak levels prevailing in June. Prices of cotton,
grains, and various other products we re above the June levels, while prices of fresh fruits and vegetables
were below the earlier se:tsolla l peaks. Butter prices rose to the new maximum level after the 5ubsidy
was discontinued in October; the subsidy on flour was increased for the month of November.
"'L-_-L_
1939
~_~_ _-L_~-L·~
·
· '-==··: ~~·~
·
-~·=O-
_
1':140
1941
1942
1
943
1944
40
1945
Bureau of Labor Statistics' indexes. Weekly ligures, latest shown are for the week ending November
17. 1945.
Maximum prices for cotton goods, building materials, and various other industrial products were
raised somewhat further, while in certain other cases, like nylon hosiery, reductions in maximum prices
were announced. The prices announced for new passenger cars ~'ere close to 1942 levels, which were
substantially above 1939 prices.
BANK CREDIT
MEMBER BANK RESERVES ANO RELATEO ITEMS
8lLUON,e~DOLU
'"~ ~~~.s
"
"
WO~E"'INt;!./
el~c~~"'TIO!;!.
"
V
"V
~.....
"
-r~/f7
'0
/' ,;
Ji./ I-.rV'
-<l ~ 1
,v
. .---.. . . .1
- RESER~,J, ",if.\. .• "
.J
\iQ .. O
/
'0
"'
"
STOCK
..fl;;.-
/'
~
W~BE" .~~o(
1
~~U.I. "'N~ES
I
E 0"''';(
-~--·l"-~--·"j"~~--·
1939
1940
1941
1942
TREASURY DEPOSITS
1943
1944
1945
Wednesday figures, latest shown are for November
14, 1945.
Since the cnd of hostilities the rate of monetary expansion has slackened. reflecting reduced
Government expenditures. Government war loan accounts at member banks in leading cities were
reduced 5.1 billion dollars between August 15 and November 14, compared with a decline of 7.8
billion in the same period last year. Adjusted demand deposits at these banks inc reased 2.1 billion in
the three months, compa red with 4.5 billion last yea r. The growth in time deposits was only slightly
less than in the same period a year ago. Currency in circulation has abo grown at a much slower
rate; during the past three mont hs the increase was less than half that of the same period last year.
\Vith reduced expansion in member bank required reserves and in currency. Reserev Bank credit
has increased more slowly lhan in previous interdrive periods. A part of the increase has been in
advances to mem.ber banks. Member bank excess reserves hlve increased somewhat and at 1.2 billion
dollars are larger than usual at this stage of war Joan drives .
Commercial loans at reporting banks, both those ill New York City and outside, have increased
somewhat more than the usual seasonal amount. Since the beginning of September th ese loans have
grown 650 million dollars compared with 340 million during the same period of 1944. Loans for
purch:J.5ing and carrying United States Government secur ities, though contracting as usual in periods
between war loan drives". continued well above previous interdrive levels. By mid-November such loans
both to brokers and dealers and to other customers were already starting to expand in connection with
the current drive.
.
@FedFRASER