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business
•
rev.em

december 1969

FEDERAL RESERVE
BANK Olr DAL lL AS
This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)

contents

demand highlights
petroleum activity in 1969

3

livestock leads district
agriculture in 1969 . . . . . . . . . . . . . . . . . . . . . . . . .

8

district highlights . . . . . . . . . . . . . . . . . . . . . . . . . . . 13

demand I.ighlights
pet,·oleum activity in 1969
The petroleum industry continued to expand
in 1969, if not as vigorously as in 1968. Data
for the first three quarters of the year (the latest
information available) show that demand for
petroleum products increased faster than expected, however, even though demand for some
products failed to reach the levels originally
estimated. Domestic crude production did not
fare as well as had been hoped at the start of
the year, largely because of greater imports of
foreign oil; but drilling activity increased after
5 years of decline, and gains were made in the
number of wells completed.
With the rising demand for fossil fuels, the
petroleum reserve-production ratio has been
falling for a decade. But the major highlights in
petroleum this year were exploration and development of new fields. Much of the outlook for
domestic production was keyed to the potential
of reserves in Alaska and resurgence of drilling
activity in the other states. Also important to
the industry was the reopening of questions
regarding the depletion allowance and import
quotas. Outside the United States, the most
important developments were in North Africa,
where Libyan fields met aU expectations.

Demand advances
Demand for petroleum products continued to
advance, reaching a level 4.6 percent higher
than the record level reached during the first
three quarters of last year. All major categories
shared in the advance, with demand for residual
fuel oil increasing 4 percent, gasoline 4 percent,
and distillate fuels 3 percent. But consumption
of jet fuel continued - as it has for several
years - to grow faster than consumption of
any other petroleum product.

In line with increases in air travel, demand
for jet fuel increased almost every monthespecially during the summer vacation season
- pushing sales more than 5 percent higher
than a year earlier, when demand rose 17 percent. The slowdown in growth of sales was related primarily to the rate of increase in air
travel, which slowed from an advance of 16
percent in 1968 to an estimated 10 percent in
1969. With projected expansion in jet fleets,
including the introduction of jumbo carriers,
the rate of increase in air travel is expected to
pick up again, and with it the rate of increase in
consumption of jet fuel.
Increased demand for residual fuel oil can
be attributed primarily to the greater use of
fuel oil in the generation of electrical power.
Antipollution laws passed in many northeastern
states last year prohibit use of high-sulfur fuels,
primarily coal. The result has been a rapid substitution of residual oil fo1' coal in power generation on the eastern seaboard. The shift was
readily apparent in the second quarter of 1969,
when sales of residual fuel oil soared nearly 10
percent higher than a year earlier.
Except for the winter months, demand for
distillate fuels was up. Although colder than
normal, January and February were not as cold
this year as last, with the result that sales of
distillates for heating fuel were down sHghtly
during those months. Even though demand for
distillates during the winter was not as high as
expected, sales through the summer were maintained by the demand for diesel oil.
Demand for petroleum products eased in the
spring, following seasonal patterns, and the
strongest demand shifted from fuel oils to gaso-

business review/ december 1969

3

line. Demand for gasoline advanced all year,
reaching its most rapid rise in September, when
sales climbed 7.6 percent higher than a year
earlier. Daily sales for the year averaged 5.6
million barrels through September, compared
with 5.3 million a year ago.

GAINS IN PETROLEUM PRODUCT DEMAND
UNITED STATES

I

ALL OILS

1968 OVER 1967

I

1969 OVER 1968

DISTILLATE
FUEL OIL

I
I

t=J
I

RESIDUAL
FUEL OIL

I

I

JET FUEL

I
o

I

I

I

I

5

10

15

20

PERCENT INCREASE. JANUARY -SE PTEMBER
SOURCES : American Petroleum Inst!lute.

U . S . Bureau of Min es.

The demand for petroleum products should
continue to mount in the fourth quarter, according to the Independent Petroleum Association of America, with sales increasing at a rate
of 4.5 percent for the year. Most of the increase
will probably come from gasoline sales, which
advanced 7.6 percent in September. With the
coming of the winter heating season, demand
for fuel oils will increase, as gasoline sales decline. The extent of the increase will depend on
the severity of winter temperatures.

4

Daily average crude oil production in the
Nation remained virtually the same as in the
first three quarters of last year, largely because
of first-quarter cutbacks in allowables in Texas.
Although modest production increases were
made in later quarters, the gains barely overcame the first-quarter decline of more than 3
percent. Through September, gains were made
in crude runs to stills every month except January, when refinery strikes stopped work at
plants on the Texas Gulf Coast.
Output in the four producing states of the
Eleventh Federal Reserve District reached its
highest daily average in June, when allowables
in Texas were raised to 63.5 percent of the
Maximum Efficient Rate of production and
output reached 3.8 million barrels a day. Although production in these southwestern states
- Texas, Louisiana, Oklahoma, and New Mexico - increased in the second and third quarters, the level of output in the District was
lower in the first three quarters than a year
earlier. Despite the January strikes at Texas
refineries, still runs were 5.6 percent higher
than in the first three quarters of last year.

I
GASOLINE

Output maintained

Imports of crude oil in the Nation during
the first half of the year ran 24 percent ahead
of those a year earlier. The increase appeared,
however, to be more a recovery from the unusually low levels of imports in early 1968 than
a net growth in demand for imports. The lower
level of crude imports in the first half of last
year stemmed from the high cost of shipping
resulting from the disruption of tanker service
when the Suez Canal was closed in 1967. l1nports this summer were less than 2 percent
higher than a year ago, and there are indica·
tions that total imports for 1969 will be only
modestJy higher than last year.
Imports of residual fuel oil, the largest single
petroleum import item, were 3.4 percent higher
than in the first 9 months of 1968. Growth

during the period was mixed but was buoyed
by a 12-percent increase in the second quarter.
Almost all residu al fuel oil imported in April
and May was to meet increased demand for
low-sulfur fuels on the eastern seaboard.
Imports of other refined products advanced
24 percent over the Janu ary-September level
set last year. The biggest gains were made in
imports of distillate fuel oils, which rose nearly
50 percent in the first half of the year. The
sharpest advances in distillate imports came in
the first quarter. Imports of jet fuel in the first
half increased 36 percent, and gasoline 23 percent. Imports of unfinished oils showed renewed
strength, making a 25-percent advance in the
first two quarters of 1969, but the gain primarily reflected recovery from a decline in inlports last year.
Through June, monthly inventories of aU oil
stocks were generally higher than a year earlier.
The buildup of crude oil stocks in the first quarter can be attributed to the refinery strikes in
January. Inventories of crude oil reached their
highest levels of the year in May and June. The
rapid buildup in those months was due, in part,
to increased allowables in Texas and to strong
consumer demand for refined products.

The rate of growth in demand for petroleum
products is expected to ease further next year
- the extent of the easing depending on
changes in the general level of economic activity. According to IPAA estimates, growth in
demand will probably drop to about 3.7 percent. Demand for jet f uel will accelerate to an
annual rate of more than 6 percent. Demand
for gasoline will increase another 4 percent next
year, but demand for fuel oils will probably
moderate slightly. The IPAA forecast shows
crude oil production increasing more than 3
percent to a daily average of 9.5 million barrels. The rates of buildup in petroleum inventories are expected to slow.
CRUDE OIL FLUCTUATIONS

STOCkS

THOUSANDS OF BARRELS DAILY

MILLIONS OF BARRELS

9.800

+15
CHANGE IN
CRUDE OIL ST09KS

9 .600 :0=-

9,400

?

9,200

Inventories of refined products did not build
up as fast as stocks of crude oil. Refined stocks
were 2.5 percent larger in the first quarter than
a year earlier, but second-quarter levels were
fractionally lower. Strong consumer demand
and restricted production resulted in the smallest
accumulation of gasoline stocks in any January
since World War II. Stocks rose at record rates
in February and March, however. Gasoline
stocks fell in the second quarter, when seasonal
demand for fuel oil tapers off and consumption
of gasoline begins to rise, but fuel oil inventories were accumulated at rates slower than
normal. Even with the low rates of accumulation of fuel oil stocks, however, most industry
spokesmen consider stocks on hand large
enough for the start of the new heating season.

UNI.TED STATES

PROOUCTION

ILdJ

\ . \.oJ

9.000

8.800

:l CRUDE OIL
PRODUCTION

•

r:

+10

11:::

+5

I

r

o

II

-5

....

j:l

r:

8.600
1968

-10

-15

1969

SOURCES : Am ene." Petroloum 1""llule .
U , S, Bureau 01 Min ""

Drilling activity picked up again this year
after a 5-year decline in the number of wells
drilled. There were 5 percent more wells drilled
in the [11'st balf of the year than during the same
period last year, a'nd 11 percent more wildcat

business review/december 1969

5

wells were completed. In line with the need for
deeper wells, total footage drilled rose 8 percent and wildcat footage rose 19 percent.
Increased drilling activity in the Eleventh
District states contributed significantly to the
greater number of wells drilled in the Nation as
a whole. Although the footage drilled increased
only 5 percent, 7 percent more wells were drilled
in these states during the first half of the year
tllan a year earlier. Wildcat activity increased
even more, with both the number and footage
of new wells advancing an eighth more than in
the first half of last year. Increased drilling in
other producing areas, such as in Kansas and
the Rocky Mountain states, accounted for other
significant increases in the number of wells
completed this year.
CRUDE OIL PRODUCTION
FOUR SOUTHWESTERN STATES
THOUSANDS OF BARRELS DAILY

6.800

The Oil and Gas Journal has forecast a 4percent increase in the number of wells drilled
in 1969. Total footage driUed is expected to be
5 percent higher than in 1968, with wildcat
drilling projected at 10 percent higher.

Prices recover
Wholesale prices of petroleum products fluctuated throughout the first three quarters of the
year but generally recovered from the depressed
levels of the past 2 years. Gasoline and distillate prices advanced through May and then
showed mixed trends for the next 3 months.
Summer ended with average gasoline prices at
the level of 2 years ago and distillate prices in
the Mid-Continent averaging half a cent a galIon higher than a year ago. Kerosene prices
also fluctuated, with advances early in the year
erased during the spring.
WelThead prices of crude oil have been edging
upward for the last 3 years. Crude prices dipped
in February but rebounded sharply by April,
rising 16 cents a barrel to the highest average
level since 1957. West Coast prices jumped 20
cents a barrel..

Outlook for reserves
6.600

The most important development of the year
for petroleum came in September with the oil
and gas lease sale of Alaska'S' North Slope. The
sale broke all records for both dollar volume of
bids and average price per acre of oil-lease land.
Accepted bids on 164 tracts totaled a record
$900 million- an average of $2,180 an acre.
The seven highest bids represented more than a
third of the total sales. The largest single-tract
bid was $75 million, or an average of more than
$28,000 an acre.

6.400

6.200

6.000
MAMJJASOND
SOURCES : Amori c an Petroleum In s titute.
U , S. Bureau of Mine s.

6

Production from the Alaskan field is expected
to rival the East Texas Field discovered nearly
40 years ago. Industry estimates of the potential yield range as high as 50 billion barrels,
but most calculations are based on expectations
that the North Slope will yield 30 billion bar-

rels. Potential of the Prudhoe Bay area alone
would represent a third of the deficit between
U.S. requirements for oil and the average rate
of reserve discovery - about half a billion
barrels a year.
With the modifications required to withstand
Arctic temperatures, which drop to 70 ° below
zero, drilling and pumping costs are high and
the logistics required to support field operations are by far the most expensive undertaken
by the industry. But most vital to development
of Alaskan reserves are the costs of delivering
crude oil to southern markets.

Legislative issues
If leasing of Arctic oil lands was the most
important development in petroleum tlus year,
the proposed reduction in the depletion alLowance was the most controversial, although the
debate over crude imports ran a close second.
Under present law, producers are allowed to
subtract from taxable income 27Y2 percent of
their gross revenue derived from oil production
to offset depletion of tlleir wells, provided tl1e
deduction does not exceed half their total net
income. A House bill would cut this allowance
to 20 percent - a cut representing an all11ual
loss to the petroleum industry of between $400
million and $650 million. The Senate has proposed a reduction to 23 percent.

Senate committee hearings were held on a
possible increase in the quota limiting crude
imports to 12.2 percent of domestic production .
The established quota is also being reviewed
within the Administration. The Departments of
Interior and Justice were due to have submitted
their recommendations to the President by midNovember. According to reports earlier this
year, analyses in these Departments tended to
favor letting more crude oil into the country.

Surge in African output
At midyear, production of crude oil outside
the Communist bloc was 8.5 percent higher
than a year earlier. The most marked gains were
made in North Africa, where output increased
22 percent, bringing total average production
in Africa to 5 million barrels a day. Although
Iran continues to hold the number three position in world crude production, Libya, which is
already second only to the United States in the
production of natural gas, is rapidly moving into
that position. According to World Petroleum,
Libyan crude production in May rose to 3.1
million barrels a day, exceeding the monthly
output of Iran for the first time.
Development of Libyan fields comes at an
opportune time. Situated on the Mediterranean,
they are in easy reach of European ports and
can compete favorably with Arabian fields that,
because of the closure of the Suez Canal, must
ship oil around the tip of South Africa.
With demand for natural gas outrull11ing
supply, Libya is coming into an even more enviable position. Cryogenic technology has advanced to a point where liquefied natural gas,
chilled to a fraction of its gaseous volume, can
be shipped in insulated huLLs. The introduction
of tankers equipped to hold cargoes at such low
temperatures is expected to eventually boost
Libyan exports of natural gas to more than 345
miLLion cubic feet a day.
Rapid advances in petroleum production are
being made throughout North Africa. Denied
her Sinai fields , Egypt has tmned ·to her western desert, which has reserves estimated to be a
tentll the size of the Libyan reserves. Algerian
output, nearing 1 million barrels a day, is due
to double or even triple in the next decade.
EDWARD L. MCCLELLAND

business review/december 1969

7

livestoclt leads dist,.ict
ag,.icultu,.e in 1969
Agricultural production in Eleventh Federal
Reserve District states this year will probably
fall a little short of the record levels reached
last year. With more cattle on feed in these
states, livestock production will continue to
rise, reaching a level about 6 percent higher
than in 1968. Crop production, while still relatively high, will be about 10 percent lower,
mainly because of adverse weather.
Despite a smaller crop output, farmers and
ranchers of the five states will probably realize
a gross income slightly higher than the $6.1
billion taken in last year. Higher prices for most
products, especially livestock, should more than
offset the decrease in crop production. If so,
net farm income will also be higher than the
nearly $2 billion realized in 1968.
A greater proportion of total cash receipts
will undoubtedly come from sales of livestock
and livestock products, but the distribution between livestock and crops will vary over the
District. The proportion from livestock will
probably range from more than two-thirds of
the receipts in New Mexico and Oklahoma to
about a third in Louisiana. Livestock will account for slightly more than half the receipts in
Texas and less than half in Arizona.

crop in Eleventh District states to 4.5 million
bales. Although 13 percent less than in 1968,
production is expected to be 14 percent higher
than in 1967. The lint yield per acre will average about 354 pounds in these southwestern
states, compared with the record of 469 pounds
set last year.
Unlike cotton, yields of winter wheat were
higher this year than last. However, a smaller
acreage allotment and increased grazing out by
cattle reduced the acreage harvested by about
CROP PRODUCTION
FIV E SO UTHWESTER N STATES
OATS
RICE
CORN
PEANUTS
COTTON
SORGHUM GRA IN
WIN TER WHEAT

Crop production down

BARLEY

Substantial gains were made in the production of most minor crops, but output of such
major crops as cotton, sorghum grain, rice, and
wheat was off from a year ago. Because the
cotton program eliminated all land diversion
requirements, 15 percent more acreage was
planted to cotton this year. But summer drought
and an early freeze cut prospects for the cotton

HAY

8

ALL CR OPS

-30

-2 0

-10

0

+10

+20

+30

PERCENT CHANGE. 1969 FROM 1968
1969 indi c ated Novomber 1.

L - . :0URCE : U. S. Department

0' Agri c ulturo .

22 percent. The result is a crop estimated at
200 million bushels, or 9 percent smaller than
last year.
As in the case of cotton, unfavorable weather
also cut sorghum grain yields and prospects for
the rice harvest. Although 2 percent more acreage was planted to sorghum grain than in 1968,
the crop, estimated at a total of 386 million
bushels, is 4 percent smaller than last year. Adverse weather and a 9-percent reduction in
planted acreage lowered prospects for the rice
harvest to 41 million hundredweight, or 24 percent less production than in 1968.
The peanut crop was also smaller than in
1968, partly because of a slight reduction in
acreage. The production of other minor crops
- corn, oats, barley, rye, flaxseed , and potatoes - was approximately 12 percent higher
than last year, but these crops still account for
less than 6 percent of total estinlated crop
production in the District states.
Texas and Arizona are expected to produce
16 percent more citrus fruit this year than last.
Together, they will produce an estimated 11
million boxes of oranges and 11 million boxes
of grapefruit. This expected output will represent about a one-fifth increase in grapefruit in
both states, a 4-percent increase in oranges in
Arizona, and a 22-percent increase in oranges
in Texas. Citrus prospects nationally are also
more favorable than last year.

Livestock production up
The increase in livestock production was due
to gains in cattle production - gains related to
several factors favoring cattlemen over other
livestock producers. Demand for beef 'has continued to increase with the rise in consumer
income. Where the average American ate 81
pounds of beef in 1959, he ate almost 110
pounds this year, even though the average price
of beef rose 17 percent over the decade. Average beef prices advanced 13 percent in the first
10 months of this year alone. Prices of other red

PRODUCTION OF LIVESTOCK
AND LIVESTOCK PRODUCTS
FIVE SOUTHWESTERN STATES
EGGS

MILK
WOOL
MOHAIR

BROILERS

TURKEYS

CATTLE ANO CALVES

LAMBS .
HOGS
ALL LIVESTOCK AN D PRODUCTS

-20

-10

o

+10

+20

PERCENT CHANGE. 1969 FROM 1968

1969 p a rtly es tim a t e d ,
SOURCES : U. S . Departm e nt of Agri c ultur e .
Fed eral Re $ erve Bank of Dall as .

meat - veal, lamb and mutton, and porkwere also considerably higher than in 1968, but
per capita consumption of all meats except beef
was lower. This trend is particularly significant
for the Southwest, which has an increasingly
large stake in beef production.
Abundant fall rains ended the summer
drought, bringing good grass development to
almost aU areas of the District for the rest of
the year. Good grazing and a plentiful hay crop
brought range cattle and calves to aboveaverage condition.
Favorable cattle prices encouraged changes
in the District'S cattle industry. The calf crop
was 3 percent larger than last year. (In Texas,
it was estimated at more than 5 million head the largest since estimates were first made in

business review/ december 1969

9

1924.) Also, a smaller proportion of the calf
crop was slaughtered, making more cattle available for feeding. Almost 2.2 miHion head of
cattle were on feed in District states on October 1. That represented a year-to-year increase of 39 percent, compared with a 10percent increase for the Nation. Texas alone
had 1,342,000 head on feed - 48 percent more
than in October 1968.

through 1967. Although the laying flock at the
start of the year was 9 percent smaUer than a
year before, the output of eggs this year will
probably be only 6 percent less than in 1968.
The number of turkeys is expected to be 3 percent smaller than last year, even though there
were slightly more breeding hens on farms in
District states at the start of the year than a
year earlier.

In pounds, red meat slaughter through September was 8 percent hi..8her than in the first 9
months of 1968. This increase' was due primarily to gains in beef slaughter, which expanded 10 percent. The number of hogs slaughtered was up only 1 percent over a year earlier,
and the number of sheep and lambs was down
15 percent. The trend toward greater beef production will probably continue several months.

Recent trends in the efficiency of dairy production continued. Milk production has remained fairly constant for a decade, while the
number of dairy cows has continued to deiline ..
Milk prod uction dropped less than 1 percent
this year, while the number of cows dropped
almost 4 percent.

The inventory of sheep and lambs in District
states declined again for the fourth consecutive
year, dropping 5 percent between the start of
1968 and the start of 1969, while the number
of goats declined 18 percent. Wool production
is expected to be 6 percent smaUer than last
year. The number of sheep shorn dropped 4
percent, and the average weight of each fleece
was down 3 percent. Arizona, with an increase
of 9 percent, was the only state in the District
to register a gain in wool production. Declines
in other states ranged from 2 percent in Oklahoma to 15 percent in Louisiana. In line with
the decline in the number of goats, mohair production was down 18 percent.
Broiler production increased in the first 10
months at a rate indicating a 7-percent gain for
the year. Even so, prices continued to rise
(averaging 8 percent higher in Texas), showing
that, with the increase in personal income, people were eating not only more beef but also
more chicken. Despite tllis advance, however,
total output of poultry, eggs, and dairy products declined slightly for the second consecutive year, marking a clear interruption in the
steady expansion of production from 1963

10

Net income rises
The expected increase in gross farm income
in the five southwestern states will be due largely
to gains in cattle prices and production. Crop
receipts in the first 9 months were 1 percent
lower than a year before, but livestock receipts
were 14 percent higher, which was enough to
raise cash receipts from farm marketings 8
percent from the level of a year earlier.
Although these proportions are apt to change
some with the increase in marketings for fall,
livestock will continue accounting for most of
the gains in farm income in the Southwest.
Where livestock receipts accounted for 43 percent of total cash receipts in these states in
] 958, the proportion had increased to 54 percent in 1968. Meanwhile, the proportion accounted for by crop receipts dropped from 57
percent to 46 percent.
Beef prices were primarily responsible for
the higher cash receipts in the District. In
Texas, the prices farmers and ranchers received
for their products in the first 10 months of tillS
year averaged 6 percent higher than in the same
period last year. But the average prices received
for livestock and livestock products were
16 percent higher, while prices received for all

crops averaged 5 percent lower. Beef prices
averaged more than $26 per hundredweight, or
20 percent over the year-earlier level and sub'stantially more than in other recent years.
By contrast, sorghum grain was the only
major crop in the District to bring a higher
average price in the first 10 months of this
year than in the same period a year earlier, and
even this increase (5 percent in Texas) reflected
the strong demand for grain as cattle feed.
Compared with the first 10 months of last year,
average prices were off 4 percent on cotton,
5 percent on wheat, and 14 percent on rice.
Nationally, gross income to farmers this year
may be the largest in more than 15 years. Substantial gains in cash receipts have resulted from
both higher livestock prices and larger crop
and livestock marketings. The gains should be
more than enough to offset the continued sharp
increases in farm expenses. Net income for the
year has been projected at $16.0 billion, or 8
percent more than last year. This increase, comFARM PRICES
PERCE NT (1910-14 =1001

42 0

r--------------------------------,

34 0

RECE IVED FOR ALL TEXAS FARM PRODUCTS

26 0

18 0
1968
SOURCE : U ,S, Department of Aerlculturc .

1969

bined with the declining number of farms,
should carry net income per farm to a level
above the 1966 high of $5,044.
Farmers and ranchers in the southwestern
states have continued to expand the amount
of credit used in their operations. Despite
higher interest rates, non-real-estate farm loans
amounted to $1.9 billion on January 1, 1969,
or 9 percent more than a year earlier. Farm real
estate loans rose 7 percent to $3.5 billion at
the start of 1969.

Prospects mixed
Prospects for agriculture in 1970 are mixed.
Government loan prices and overall crop acreage allotments will probably be much the same
next year, and, with normal weather, income to
crop producers may be somewhat higher than
this year. Assuming continuation of the present
high level of demand for red meat, prospects
appear bright for livestock producers, particularly cattlemen.
Because of the expected shortfall in the 1969
cotton crop, the acreage allotment for upland
cotton in the five District states has been increased to 9,181,134 acres -- a 6-percent in'crease over 1969. The proposed 1970 cotton
program will be similar to tlle program this
year. The national average rate of price-support
loans will still be 20.25 cents a pound for Middling I-inch cotton at average locations. The
rate of price-support payments will be 16.80
cents a pound, compared with 14.73 cents
under the 1969 program. Carry-over of cotton
next summer is expected to be at the lowest
level since 1953 .
To help strengtllen the farm price for wheat
and allow for the Nation's shrinking share of
world wheat trade, the wheat acreage allotment
in these states has been reduced for the tlurd
consecutive year. The reduction -- to 4,613,332
acres -- represents a cut of about 12 percent.
The national average level of price-support
loans will remain at $1 .25 a bushel. Other pro-

business review/ december 1969

1'1

visions of the 1970 wheat program are similar
to the 1969 program. Participating farmers will
receive marketing certificates based on 48 percent of the projected production on their allotted acreage. Payments per bushel will reflect
difference between wheat parity on July 1,
1970, and the average loan rate. This year,
certificates were paid on 43 percent of projected
production at a record $1.52 a bushel. Certificates should be at least as high next year.

The cost-price squeeze will continue for both
crop and livestock producers, These producers
need to make decisions regarding machinery,
Jabor, and land resource combinations that tend
to minimize unit costs of production and, thereby, increase net profits. Unless appropriate
resource adjustments are made, farmers and
ranchers with inefficient operations are likely to
realize lower net incomes than in 1969.
CARL G. ANDERSON , JR.
ARTHUR L. WRIGHT

ELEVENTH FEDERAL RESERVE DISTRICT

OKLAHOMA

'I,

c::J

DAllAS HEAD OFFICE TERRITORY
HOUSTON BRANCH TERRITORY
SAN ANTONIO BRANCH TERRITORY
EL PASO BRANCH TERRITORY

12

district highlights
The seasonally adjusted Texas industrial production index rose in October, reaching a level,
at 179.1 percent of the 1957-59 base, 0.9 percent higher than the downward revised level for
September. From August through October, the
national production index declined from its
record level in July. By contrast, production in
Texas rose, after a decline in August, to high
levels in September and October. Sectors of the
Texas economy showing significant month-tomonth gains in October included crude petroleum, mineral extraction, and stone, clay, and
glass manufacture. Production of durable goods
remained about the same as in September, while
nondurables increased 1 percent. Mining rose
2 percent, while utilities remained at the September level.
On a year-to-year basis, the Texas industrial
production index was up 7.6 percent. The
largest gains ·were in utilities and durable goods.
Nondurable goods and mining showed less than
average growth. Machinery-producing industries posted the largest gain of all- more than
2'0 percent.
Nonagricultural wage and salary employment
in the five southwestern states rose again in
October, continuing an uptrend for the previous
9 months that pushed employment to a level
3.6 percent higher than in October] 968. The
increase, at 0.3 percent, was more than the
increment for July, August, or September. Both
manufacturing and nonmanufacturing employment increased slightly, but the small change in
nonmanufacturing employment concealed larger
shifts within that category. Employment in mining followed a weakening trend set several
months ago, declining 1 percent. Government
employment, on the other hand, posted a substantial monthly gain. Compared with October

1968, manufacturing employment was up 3.8
percent and nonmanufacturing employment was
up 3.6 percent. Mining, construction, and government employment showed the smallest yearto-year gains.
Total personal income in the United States
increased about 4.1 percent in the first half of
this year. Though rapid in terms of historical
growth patterns, this increase was less than a
year earlier. In the first 6 months of 1968, personal income gained 5.4 percent. Personal income in Arizona, Louisiana, New Mexico, and
Texas advanced about apace Witll the increase
for the Nation, but the growth in Oklahoma was
considerably less than tlle national average.
The advances in Texas and Arizona were
slow in the first quarter but moved ahead much
faster in the second, largely because of marked
changes in income to falmers. Income (seasonally adjusted) of farm proprietors in these states
ran counter to the national uptrend in farm income in the first quarter, declining 28 percent
in Texas and 45 percent in Arizona. Then, in
the second quarter, income to farm proprietors
made a strong recovery; in Texas, such income
reached the highest level in 13 quarters, due
entirely to increased livestock marketings. The
strong second-quarter recovery of farm proprietors' income after a first-quarter decline was
enough to account for the sudden gain in Texas
and Arizona in the second quarter. Averaged
together, these quarterly movements show a
growth rate in personal income for the first half
that is close to the national average.
Daily average production of crude oil in the
four producing states of the Eleventh District
rose 1.4 percent in October. The increase-

business review/ december 1969

13

which reversed a 3-month decline in outputwas paced by higher output in Texas and Louisiana. These two states produced 85 percent of
the District's total output of crude in October.
Production in Oklahoma and New Mexico declined. Production in the four states was 4.9
percent higher than a year earlier. Texas showed
the largest year-to-year gain, with production
up 9.1 percent.
In Texas, the oil allowable for October was
set at 53.7 percent of the Maximum Efficient
Rate of production, up from a rate of 52.1 percent in September. The November allowable
was lowered to 52.7, but because of expected
higher demand for fuel oil during the winter
season, the allowable for December has been
raised a full 10 percentage points. December
allowables in Oklahoma and New Mexico will
be at November levels.
Cotton prospects in states of the Eleventh
District, already reduced by summer drought in
some areas, have been cut further by an early
freeze and rain in the High Plains of Texas.
Based on November 1 conditions, total cotton
production in these five states is estimated at
4,545,000 bales. Although nearly 14 percent
greater than the 1967 crop, the 1969 output is
13 percent short of the total last year. The
November estimate showed a decline of 6 percent in October alone. In Texas, the crop is
expected to total 2,950,000 bales - down 9
percent from the estimate on October 1. While
nearly 7 percent higher than the output in 1967,
this cotton crop will be about 16 percent less
than the crop in 1968.
Production of sorghum grain in District states
has been estimated at nearly 386 million bushels, or 4 percent less than last year. Rice production is estimated at 41 million hundredThe
weight, or 24 percent less than in
hay crop, while close to its 1967 level, is expected to be 11 percent smaller than the 10 million tons produced last year.

14

Recent rains have returned range and 'livestock conditions to near normal. In Texas, there
were 1,415,000 head of cattle and calves on
feed for the slaughter market on November 1.
This was 41 percent more than a year earlier
and 5 percent more than a month earlier. There
were 515,000 head of cattle and calves on feed
in Arizona, or 32 percent more than a year
before and 14 percent over the previous month.
Placements into Texas feed lots totaled 350,000
head in October - 24 percent over October
1968 and 28 percent over September this year.
Placements in Arizona were 141,000 head, representing a year-to-year gain of 18 percent and
a month-to-month gain of 72 percent.
Prices Texas farmers and ranchers received
for their products on October 15 averaged 1
percent lower than in September but 6 percent
higher than in October last year. The price
index for crops was 1 percent above the previous month but 5 percent lower than for the
same period last year, mainly because of declines in prices for rice and upland cotton. The
price index for livestock and livestock products
was 3 percent lower than in mid-September but
15 percent higher than a year earlier. Prices for
hogs and lambs increased from the previous
month, but prices for beef cattle and calves
showed a decline.
Cash receipts from farm marketings in the
five southwestern states averaged 8 percent
more in the first three quarters of this year than
in the same period in 1968. The increase reflected a 14-percent gain in livestock receipts
and a I-percent decrease in crop receipts.
Changes in the major balance sheet items at
weekly reporting banks in the Eleventh District
were mixed in the 5 weeks ended November 12.
Loans adjusted decreased $32 million, continuing a downward movement since early July. In
the corresponding 5 weeks last year, loans adjusted rose $60 million. In the recent period,
real estate loans increased $13 million, and

consumer loans increased $9 million. These
increases were more th an offset, however, by
declines of $41 million in loans to financial institutions other than bartles, $5 million in business loans, and $37 million in " other" loans.
Total investments increased $64 million, reversing a downward movement for the previous
8 weeks. A year earlier, total investments increased $146 million. The recent increase was
due primarily to a $35 million gain in holdings
of Treasury bills and a $24 million gain in holdings of obligations of states and their political
subdivisions. Holdings of U.S. Government securities with 1- to 5-year maturities declined
$10.0 million, while holdings of Governments
with maturities of 5 years or more increased
$13.5 million.
On the liability side of the balance sheet,
total demand deposits increased $125 million,
primarily because of a $44 million gain in deposits of individuals, partnerships, and corporations and an $83 million gain in deposits of
states and their political subdivisions. In the
corresponding period in 1968, total demand deposits increased $168 million.

new
tnetnbe.·
bunk

Total time and savings deposits declined $83
million, in contrast to an increase of $38 million
in the same period last year. A decline of $109
million in deposits of individuals, partnerships,
and corporations was only partially offset by an
increase of $21 million in deposits of states and
their political subdivisions. Negotiable certificates of deposit in denominations of $100,000
or more continued to
registering a $27
million drop in tbe 5 weeks ended November 12.
In the corresponding period a year ago, large
CD's rose $24 million.
Registrations of new passenger automobiles
in Dallas, Fort Worth, Houston, and San Antonio were 22 percent higber in October than in
September. They were 2 percent lower, however, than in October of last year. So far this
year, registrations are running 3 percent ahead
of the same period last year.
Department store sales in the Eleventh District for the 4 weeks ended November 15 were
6 percent higher than in the comparable period
last year. Cumulative sales through November
15 were 8 percent higher than a year ago.

The Northwest National Bank, Houston, Texas, a newly organized institution
located in the territory served by the Houston Branch of the Federal Reserve
Bank of Dallas, opened for business November 3, 1969, as member of the
Federal Reserve System. The new member bank has capital of $500,000, su.rplus
of $500,000, and undivided profits of $250,000. The
are: David .F.
Chapman, Chairman of the Board ; Sam
Bowman, President and
Executive Officer; R. B. Goldstein, Vice President; and W. L. Houser, Cashier.

business review/december 1969

15

' OUR S(

louisio
New N

Oklo he

Texa s.
Gulf

We,
East

Pan'
Rest
;NITED
SOUR(

Cre
••
;';;orn ••••
'W

g ats ....
••
:ye . . .. .
••••

fla xsee d
... .

eanu ts5 ,
irish pote

Arize
o In th
a In th
, In th
• In th
o In th
SOUR(

1

I ·N 1· 5 - S
2·N - R
2· 5 - R

3

-

4
- B
5·N - E

5·S - E
6
- T
7
- E
8· N - S
8·S - S
9 - C
O·N - S
O·S -l,
State . • • • • • • • • • • • . • . • • • • • • • • • • •

3,250

SOURCE, U.S. Department of Agriculture.

3,525

2,767

92

II

j

STATISTICAL SUPPLEMENT
(

to the

BUSINESS REVIEW

December 1969

FEDERAL RESERVE BANK
OF DALLAS

RESERVE POSITIO NS OF MEMBER BA NKS

CONDITION STATISTICS OF WEEKLY REPORTING
COMMERCIAL BANKS

Eleventh Federal Reserv e District

Eleventh Federal Reserve District

(Averages of daily figures. In tho usands of dollars)

(In thousands of dollars)
Nov. 26,
Item

1969

Oct. 29,
1969

1968'

ASSETS
Fe d eral fund s sold and securities purch ase d
under agr eeme nts to rese ll. .....••••.. . .. ...
Othe r loan s and di scounts, gro ss •.......•... ...•
Comm ercial and industrial loan s••• •••••.•. .••

Agricultural loans, excluding CCC
certiflcotes of interest ••..........•.•.. ...
loons to brokers and dealers for

389,972
5,977,082

U.S. Government securities .............. . .
Oth er securiti es ••..•••.• ••• ••• . .• •••• •••

Othe r securities ••..•...•....•.. . .......• '

I

6,118,419

----

----

2,960,231

2,95 1,802

---2,86 1,353

109,223

106,281

92,522

555
42,75 1

555
42,041

74,573
99,281

740
393,447

692
380,936

320
372,54 1

125,828
336,024
664,009
11,265
8,390
713,395

130,485
339,145
652,986
16,869
8,370
7 14,270

123,476
348,402
605,403
289,249
6, 126
628,849

0
61 1,224
2,480,174

0
628,841
2,498,322

0
616,324
2,617,046

35,878
0

946,782
54,097
0

1,127,828
48,122
0

134,359
623,996
136,191

116,723
620,971
154,99 1

179,9 15
636,276
263,5 15

30,299
1,396,799

33,0 13
1,391,881

34,142
1,238,908

purcha sing or carrying :

Other loan s for purchasing or carrying:
U.S. Government securities ••.... . . ... . ....

302,755
5,973,273

Loons to nonbank Anencial institutions:

Sales flnance, personal flnance, foctors,
and other business credit companies ••• .. ..
Other ..•................. ..• •••. ...• .•
Real estate loan s . • .....•.....•........••..
Loans to domestic commercial banks ..• . .•• . .. .
Loans to foreign banks •.•...•.......• . .•...
Consumer instalment loans •...... . . .......•..
Loans to foreign governments, official
institutions, central banks, international
institutions ••. .••..••...••....• , . .......•
Other loans .•. •. ....•.....•.....•.•.•....
Total inve stments . .....• . . . .......•..••....•.
Total U.S. Government securities •••.•..•...•. .
Tre a sury bills ....•..••..•.....••..•••..•
Trea sury certificates of indebtedness .• •... ..
Tre asury notes and U.S. Government
bonds maturing:
Within 1 year •.• .•. ..••.. . .••... ••...
1 year to 5 years •••.•..••..••••••. . ••
After 5 years • • .•.. • .•..... .• ••..•••..
Obligations of sta tes and political subdivisions:
Tax warrants and short- term notes and bills ..

All other ...... . ... ............ ..... ... .
Other bonds, corporate stocks, and securities:
Certificates representing participations in
Federa l agency loon s ..••...• .. .••.....
All other (including corporate stocks) .•.. . ...
Cosh it e ms in process of collection . ... . •..••...•
Re se rve s with Federal Reserve Bank . . • • ..•• . ....
Curre ncy and coin ..•••.. ••. • .•.••....• •. ... •
Balances with banks in the United States •.• • • . ...
Balances wi th bonks in foreign countries •.••..•..
Othe r a ssets (including investments in subsi diari es
not consolidated) ..•..•...•.. . .. • .. ..•.....

---930,424

Item

Nov. 27,

5 weeks e nded
Nov. 5, 1969

4 weeks en d e d

Oct . I, 1969

5 weeks ended
Nov. 6, 1968

732,869
68 1,31 7
51,552
722,360
10,509
15,166
-4,657

73 1,786
678,249
53,537
737,885
-6,099
20,992
-27,09 1

74 1,271
69 1,162
50,109
738,882
2,389
1,543
846

773,084
595,200
177,884
750,086
22,998
13,287
9,7 11

779,853
594,908
184,945
25,268
12,840
12,428

724,392
550,405
173,987
703,438
20,954
8,493
12,461

1,505,953
1,276,5 17
229,436
1,472,446
33 ,507
28,453
5,054

1,5 11 ,639
1,273,157
238,482
1,492,470
19,169
33,832
- 14,663

1,465,663
1,24 1,567
224,096
1,442,320
23,343
10,036
13,307

RESERV E CITY 8'ANKS
Total reserv es he ld .•. . .... . ...
W ith Fed e ra l Rese rve Bonk .•. .
Curre ncy and coin • .......•. .
Require d rese rves .•.. . .•...•..
Excess reserves .•. . •..... ... . .
Borrowings •....••..........•.
Free res e rve s •.••..•..• .. ..••.

COUNTRY 8ANKS
Total reserves held .. . ... . .....
With Federal Re serve Bank •• .•
Currency and coin ..... . . . ...
Require d rese rve s ••.. .........
Excess reserves ..•.....••. . ...
Borrowings •.... . ... ... . ..••••
Free reserves .. . ...... .. ...•..

ALL MEM8ER 8ANKS
Tota l reserve s he ld . • .... . .....
With Federal Reserve Bonk .•..
Currency and coin . ...•.... ..
Required re serves .•.. . ....• . ..
Excess reserves ............•.•
Borrowings •.•......... •.... •.
Free reserves . . •....••.• . •....

---CONDITIO N OF THE FE DERAL RESERVE BANK OF DALLAS
(In tho usands of dollars )

53,559
69,Q93
1,140,255
719,035
79,494
507,765
6,686
448,03 1

TOTAL ASSETS . . . . . .. .. .. . • . . .. . • . • . . .. 11?48,494

60,629
66,017
1,05 1,324
716,277
87,334
459,291
7,700

148,2 13
67,955
1,096,782
802,091
80,006
512,954
5,489

447,533

359,438

Nov. 26,
1969

It e m
Total gold certiAca te reserves •••.. . •...•. .. .
Discounts for member bonks •..••... . .•.....
Other discounts and advanc es •••..........•
U.S. Government se curities ..•.... .. • . .•• . ..
Total earning assets ••.•..•.. •... . .•.......
Member bonk reserve d eposits .•.•.....•....
Federal Reserve notes in actua l circulation ••••.

Nov . 27,
1968

Oct. 29,
1969

292,972
22,790

310,680
14,7 15

306,886
24, 100

2,493,615
2,516,405
1,245,705
t ,699,971

2,432,825
2,447,540
1,236,367
l ,670n 15

2,282,495
\ 2,306,595
1,292,834
1,533 ,234

o

o

o

------11,543,809 11,592,225
COND IT ION STATI ST ICS OF ALL MEMB ER BANKS

LIABILITIES
Total deposits •......•...••...•..• .. •. . .•• ..
Total d ema nd deposits .. . ...•..............
Individual s, partn ers hips, and corpora tions . • .•
States and political subdivisions . •...• ..• . ..
U.S . Government •.•........•.... .. .... . .
Bonks in the Un ite d States ••••..•• .....••••
Foreign:
Governments, official institutions, cen tral
banks, internation al inst itutions • • ..•....
Commercial bonks . • . ..•• ... •. .•.. .....
Certifled and ofAcers' checks, etc .••• • ...• •.
Total tim e and savings d epos its ••.••...•••...
Ind ividuals, partnerships, and corporations:
Saving s deposit s ••.... . ...•••.••.•....
Other time deposits •. .. .•. .... .........
States and political subdivisions •....•......
U.S. Gove rnment (including postal savi ng s) ..•
Bonks in the United States . •.•....•..••....
Foreign:
Government s, ofAcia l instit ution s, central
banks, international Institutions •... . ... .
Commercial bonks ..• , ........••.......
Federal funds purcha se d and sec urities sold
under agreements to repurchase •••. .. . . .....
Other liabilities for borrowed money ......••. . • .
Other liabilities .. .. . .... .....•...........••.
Re servos on loan s ...• . ........ ..•• . . .. . . . .. .
on se curities .. •.....•.•. .......... ..
Total.capital accounts • . .•. .... .. ..• . .. . . ... ..

9,175,973

9,030,685

5,8 18,010
4,044,9 14
356,248
13 1,920
1,176,773

---5,798,870

3,949,947
258,669
163,770
1,176,327

4,053,793
35 1,167
64,334
1,227,486

3,570
25,4 10
79,175
3,357,963

3,250
27,363
91,254
3,360,105

3,121
25,051
73,9 18
3,898,373

943,182
1,754,943
628,638
5,067
19,273

943,395
1,772,225
613,697
5,286
18,642

1,046, 154
2,174,953
635,010
11,644
23 ,31 2

5,500
1,360

5,500
1,360

7,000
300

(I n millions of do ll ars )
Oct. 29,
1969

Sept. 24,
1969

Oct. 30,
1968

11 ,297
2,138
3,180
1,236
262
1, 178
9
1,2 13
732

1 t ,551
2, 11 6
3,144
1,283
265
1,231
1,294
761

10,445
2,483
2,960
1,256
253
1,216
7
1,169
492

21.245

21,654

20,28 1

Tim e d eposi ts •.........• . .. . . ... . .•.• . .

1,507
8,770
7,285

1,52 1
9,088
7,266

1,560
8,663
7,426

17,562
1,035
927
1,721

17,875
l , t 29
943
1,707

17,649
655
342
1,635

21.245

21,654

Item

ASSETS

Loon s and di scoun ts, gross l ••••••. . •••••••
U.S . Government obligations • . •.. ..... ....
Other securities •••.•....••..•..........
Re se rves with Federal Reserve Bonk •••• .•..
Cash in vault .......... •• . ... .. .•••.. .•
Balances with banks in th e United States •...
Ba lances with banks in foreign countries e ....
Cash items in p rocess of collection •.......•
Other assets e ••...... .....• ..... •. ..• . ' .

TOTAL ASSETse . ............ .. .. ....

838,975 }
155,770
417,435
116,525
11,478
972,941

597,275
248, 168
109,585

Demond depo sits of banks • ........ . .... .

----

----

939,954

Total depo sits .... .. ...•.... . ..... • ..
Borrowings •. . . . ............•. . .... • ...
Other liab ilities e .•...•....••. .•....•.. •
Tota l capito l accounts e ..... ........ .. ...

11,543,809

11,592,225

TOTAL LIABILITIES AND CAPITAL
ACCOUNTSe ........•••...........

n.a.

1 Because of format revision s as of Jul y 2, 1969, earlier data ore not full y comparab le.
n .a . - Not available.

9

LlA81L1TIES AN D CAPITAL ACCOUNTS
Other demand d eposits ••••........ .. ....

928,037
170,322
369,4 12
116,583
10,623
977,544

TOTAL LIABtLITIES, RESERVES, AND
CAPITAL ACCOUNTS. . . . . . . . . . . . . . . . .. 11 ,748,494

2

Eleventh Fed era l Reserve Dis trict

9,697,243

--- - - - -5,670,580

I Before Jul y 2, 1969, this item was published on a ne t basis.
e - Estimated.

BANK DEBITS, END-OF-MONTH DEPOSITS, AND DEPOSIT TURNOVER
(Dollar amounts in thousands, seasonally adiustod)
DEBITS TO DEMAND DEPOSIT ACCOUNTS'
DEMAND DEPOSITS'
Percent change

Standard metropolitan
stati stical oreo

(Annual · rate

Septemb er

basis)

1969

Wichita Falls . ............. . ... . ........ ... . .

6,188,820
2,648,664
8,799,408
939,720
1,986,840
5,642,544
8,599,524
6,31 1,664
1,709,760
5,Q35,896
434,400
121,362,180
6,972,192
20,675,4 12
2,561,256
97,965,192
890,328
4,542,780
1,6 16,184
2,108,304
1,761,5 16
1,234,416
15,868,212
1,029,864
1,465,848
2,287,152
2,947,080
2,470,356

TOlal-28 centers •.................... . ... .. ..... ...

$336,055,5 12

AR IZONA, Tucso n . ................ .. ................
LOUIS IANA, Monro e •..........•...•.... .. . .•.......
Shreveport ... .. . . ...•... .......•.•......

NEW MEXICO, Ro swell ' .•...• .. ........ . ..••......••
TE:XAS, Abil ene •..•. ... ........ .. . .................•
Amarillo ........... .. .............. .... • . •.•

Austin . ................. ... . . ... . .. . ....... .
Beaumont-Port Arthur- Orange ...•...... • ..... . .
Brown svill e-Harl ingen-San Benito . . ...• . ...... ...

Corpus Christi..... .. ........ . ................
...... . ..... . .... .. . ..... . ....... .
Dallo s.... ...........•....... . •.• .. . . .......
EI Paso •... ....... ... ... ..•................ .
Fort Worth .. ....... .. . . .....•.• ........ ..• . .
Golveston-Texa s City ............... . . .. ......
Houston •... . ....... ... .. . ........ .... .... •.
Loredo ............ . . . ....... . .. . .•...•.•...

Lubbock ... ...........•.... .... . . .. .......• .
McAllen· Pha rr-Edinburg •.•.......•.•.....••.. . .
Midland ••......•........•.. ... ..•......•.•.
Odessa ........................ .. .......•...
Son Angelo ...................... . ....•.....
Son Antonio . . . ......... . . .. ...........•.....
Sherman-Denison .. ...... ... .. ................
Texarkana (Texas-Arkansas) ........ ... .........

Tyler .... ....... ............................
Waco . •... _ ...... ................. . ........

1
!!

$

Annual rote
of turnover

October 1969 from

October
1969

October
196B

10 months,
1969 from
196B

-5
-4
-2
-8
-4
-1
-2
2
-2
7
-5
0
-8
-3
-2
0
- 11
1
7
0
2
-7
-6
-12
1
-6
6

27
24
35
27
8
4
3
5
-3
11
13
26
16
9
15
20
14
14
-7
14
20
19
4
11
-5
13
13
3

19
17
28
23
10
6
39
7
6
8
5
28
16
12
7
17
14
16
7
12
18
12
10
10
9
18
14
6

-4

19

20

----------------Septem b er
October
Octob e r

October 31,
1969

1969

1969

1968

229,588
72,392
206,4 11
28,384
2,049,638
224.885
604,509
103,957
2,405,718
38,614
161,749
91,446
132,379
67,768
68,224
589,516
63,009
67,723
89,571
113,566
113,437

27.9
30.4
37.4
25. 1
19.8
35.9
31.4
27.3
24.0
24.5
14.6
57.7
30.4
33.3
24.3
40.3
22.9
27.7
17.6
15.7
24 .1
17.9
26.8
16.2
21.7
24.5
25.2
21.1

27.7
30.6
37.4
25.6
21.7
36.7
31.9
27.0
24.7
25.1
13.1
57.6
29.6
35.9
25.0
40.2
23. 1
31.5
17.8
14.5
22.7
17.7
28 .8
17.6
24.5
23.8
26.4
19.5

25. 1
25.2
27.3
21.9
17.9
36 .6
30.7
25.9
24. 1
23.0
13.8
47.4
28.4
32.3
20.5
35.1
21.0
24.2
20.0
14.2
22.3
16.0
25.3
16.0
22.6
21.4
22.8
20.6

$8,630,44 1

38.4

38 .9

33.4

223,194
83,370
228,089
36,567
100,450
155,803

Deposits of individuals, partnerships, and corporation s and of states and po litico l subd iv isions.
County basi s.

GROSS DEMAND AND TIME DEPOSITS OF MEMBER BANKS
Eleventh Fe deral Reserve Di strict
(Averages of daily figures. In million s of dollars)

BUILDING PERMITS

Percent change

Oct. 1969
NUMBER

from
10 month s,

Area

Oct.
1969

10 mos.
1969

Oct.
1969

10 mo s.
1969

Se pt.
1969

Oct.
1968

1969 from
1968

Dote

Total

Reserve
city bonks

Country
bonks

1967, October ...
1968, October ...
1969, May .. .. ..

9,511
10,201
10,23 1
10,209
10,316
10,250
10,497
10,306

4,448
4,75 1
4,777
4,758
4,783
4,746
4,867
4,726

5,Q63
5,450
5,454
5,45 1
5,533
5,504
5,630
5,580

Jun e ..... .

Jul y .......
ARIZONA
Tucson ........

58 1

6,285

3,146

51,825

67

51

88

69
410

629
4,23 1

1,500
2,977

11,074
34,Q62

190
-49

9
49

-37
57

36
1,515
360
245
77
316
1,753
23
495
524
85
4,629
46
87
40
58
93
43
1,1 09
61
25
200
77

390
12,908
4,085
1.808
649
3,261
19,16 4
274
4,372
4,926
854
31,415
342
1,056
44 1
623
843
551
10,6 46
763
334
2,405
720

2,949
2,780
20,407
898
302
3,019
13,472
83
6,505
4,130
959
43,000
1,569
2,002
206
424
251
352
6,236
358
267
786
4,788

11,234
551
525
72
34,857 -58
135 ,786
89 - 166
9,470
48 -48
7,333
90 - 11
21,842
7 1 -69
279.561 -33 -44
2,587 -46 -72
74,001
68 -36
64,331
-3 -57
17,588 -66 -91
372,472
7
6
3,937 2,806
414
24,65 1
6 -49
5,296 -78 -67
7,263
38 -35
7,927
85 -66
5,365 -37 -27
70,68 1 -35 -26
17,536 -52 -50
4
6,084 -79
-7
16,38 1 -34
252 1,054
16,530

52
99
32
-33
65
-50
13
-29
25
- 16
-9
9
61
- 16
-50
18
54
-32
-32
282
-52
12
72

LOUISIANA
Monroe-West
Monroe .... .
Shreveport ....

TEXAS
Abilene •......
Amarillo .•....
Austin .•......
Beaumont. ....
Brown svill e ....

Corpus Christl ..
Dallas ........
Deni son ..•.. . ,

EI Paso • •••••.
Fort Worth ••••
Galves ton .. •. .
Houston . . ....
Laredo .... ...

Lubbock •• .• ••
Midland .•••••
Od essa .......

Port Arthur •..•
San Angelo •.•
San Antonio ...
Sherman ......
Texarkana ....
Waco .. •. ....

Wichita Falls ••

- - - - - ------$ 123,366 $ 1,309,674

Total-26 cities • • 12,957 113,975

- 11

TIME DEPOSITS

GROSS DEMAND DEPOSITS

VALUATION (Dollar amounts in thousand s)

August . ...
September.
October ...

Total

city banks

Country
banks

6,457
7,394
7,676
7,634
7,474
7,353
7,272
7,223

2,753
3,116
2,962
2,925
2,806
2,741
2,685
2,646

3,704
4,278
4,714
4,709
4,668
4,612
4,587
4,577

Rese rv e

VALUE OF CONSTRUCTION CONTRACTS
(In Illillions of dollars)
January-October
Area and typ e

FIVE SOUTHWESTERN
STATES' ..... . .... .. . ...
Residential bullding ..... . .
Nonre sid ential building ....
'<4onbuilding con struct ion ...

UNITED STATES ............
Residential building .......
Nonres id ential building ....
Nonbuilding con str uction ...

Octob e r
1969

Sept emb er

August

1969

1969

1969

1968

613
256
234
123
6,240
2,290
2,502
1,449

460
209
132
11 9
5,140
1,952
2,0 13
1,175

598
267
193
138
6,523
2,394
2,460
1,669

5,822
2,4 13
1,911
1,498
58,067
2 1,920
22,067
14,080

5,539
2,276
1,658
1,606
52,50 1
2 1,114
18,738
12,649

I Arizona, Loui siana , N ew Mexico, Oklahoma, and Texas.
NOTE. - Details may not add to totals becau se of roundin g.

SOURCE, F. W. Dodge, McGraw· Hill, In c.

3

COTTO N PRO DUCTIO N

CRO P PROD UCTION

(In lhousands of bushels)
TEXAS

Texas Cro p Reporting Districts

FIVE SOUTHWESTERN STATES'

1969,

1969,

Nov. 1

1968

1967

Nov. 1

1968

1967

Cotton 2• • •••••• •
Corn •.......•. .
Winter wheat ••.•

2,950
30,528
69,768
24,768
2,772
648
21,411
322,320
1,296
3,755
417,600
4,532
750
33,000

3,525
26,052
84,150
19,822
3,348
528
27,462
340,780
742
4,587
426,300
4,382
960
69,000

2,767
18,658
53,216
6,615
1,350
350
25,400
343,485
150
3,774
333,450
4,329
810
34,000

4,545
40,029
199,938
32,248
30,648
1,688
41,269
385,765
1,296
9,313
639,260
8,353
5,090
88,000

5,244
36,871
218,974
25,450
26,856
1,208
53,943
402,171
742
10,418
671,476
7,654
5,206
97,000

4,000
27,595
150,903
11,533
18,007
909
47,435
409,267
150
9,565
558,470
7,892
5,008
111 ,400

Oats .. .. . . .....

Rye ............
Ric e ' .. .. ... ....
Sorghum gra in •..

Flaxsee d ...... .

Hoy· ...........
Peanuts6 •.••• •• •
Irish potatoes G•••

Arizona, louisiana, New Mexico, Oklahomo, -and Texas .
In thou sand s of balos ,
a In thousand s of bogs containing 100 pounds each.
" In thousands of tons .

500 pound. gross weight)

1969,
indicated
Nov. 1

1968

1967

1968

10·N - South Texas Plains. •••••...••
10·S - lowe r Rio Grande Valley ......

255
1,150
200
240
15
260
15
40
155
50
50
105
95
15
305

21 1
1,384
312
372
20
409
19
41
189
72
57
93
79
25
242

258
937
218
234
12
264
19
39
158
23
54
98
117
20
3 16

121
83
64
65
75
64
79
98
82
69
88
11 3
120
60
126

State .. .. ..... ... ..... . ........

2,950

3,525

2,767

84

estimated

estimated

Crop

Barley . ... .....

(In thousands of boles -

Area

I -N
I·S
2·N
2·S
3
4

-

Northern
Southern
Red B.d
Re d 8ed

Hig h Plains ••• ... •...
High Plains •.•.. . •••.
Plains •••...•....•..
Plains •.....•....•..

- Wes tern Cross Timb ers ...... ..
- Black and Grand Prairies •..•..

5·N - Ea st Texa s Timbered Plains ....
5·S - East Texo s Timbered Plains ....

6
7

- Trans-Pecos... . . ... ... ......
- Edwards Plateau • •.. .. . ... . ..
8-N - Southern Tex as Prairie s ... ....
8-S - Southern Tex a s Prairies .. . . .. .
9 - Coa stal Prairie s.... ...... . •..

1969
as porcent o f

1

G

SOURCE : U.S. Department of Agricultur •.

In thousands of pounds.

o In thousands of hu ndredweight.

SOURCE : U.S. Deportment of Agriculture.

DAILY A VERAGE PRODUCTION O F CRUD E OIL
TOTAL OIL WELLS DRILLED

(In thousands of barre l.)
Percent change from

Area

FOUR SOUTHWESTERN
STATES .... .. .. ..... ....
Louisiana •• • ••. ••• ..••• •
New Mexico • •••. . . .. . ...

Okla homa •• • ...... • •..•
Texas ........ . .. . .. .. . .

Gulf Coast ............
West Texas ....... . . . .

East Texas (proper) ••.••
Panhandle • • •.•• •• ••. .
Rest of State ..........
UNITED STATES ............

October
1969

September

September

October

1969

October
1968

1969

1968

6,5 14.3
2,306.7
348.0
611.7
3,247.9
672.4
1,520.9
175.9
83.6
795.1
9,354.2

6,423. 1
2,288.9
353.2
617.5
3,1 63.5
660.6
1,473.3
171.4
80.5
777.7
9,258.5

6,11 3.7
2,172.3
356.1
609.5
2,975.8
608.2
1,356.2
136.9
86.9
787.6
8,917.6

1.4
.8
- 1.5
-.9
2.7
1.8
3.2
2.6
3.9
2.2
1.0

6.6
6.2
- 2.3
.4
9.1
.6
12.1
28 .5
-3 .8
1.0
4.9

Area

FOUR SOUTHWESTERN
STATES .. . ..............
l ouisiana . ..... . ... .....

Offshor........ . ......
Onshore ......•.......
New Mexico •••..........

Oklahoma •••.•..•.•••••
Texas ............•.... .

Offshore • •. ...••...•..
O nshore .. ..... .... . ..

UNITED STATES .......... ..

Percent
cha nge

Second
quarter

First
quarter

1969

1969

Percent
cha nge

1,795
226
27
199
252
339
978
1
977
3,357

1,736
280
93
187
49
435
972
4
968
3,281

3.4
- 19.3
-71.0
6.4
414.3
-22.1
.6
-75.0
.9
2.3

1969

from 1968

cumula tive

cumulative

3,53 1
506
120 "
386
301
774
1,950
5
1,945
6,638

6.5
-23 .2
-46.4
- 11.3
B.7
21.9
11.7
- 16.7
11.8
4.1

SOURCE : Ame rican Petro leum Institute.
SOURCES :

American Petroleum I nstit ute .

U .S. Bureau of Mines .

Federal Rese rve Bonk of Da llas.

N O NAG RI CULTU RAL EM PLOYMENT
INDUSTRIA L PRODUCTION

Five Sou thwestern Sta tes'

(Seasonally adj usted Indexes, 1957·59

= 100)

Percent cha nge

Oct. 1969 from

Number of person s

Type of employment
Total nonagricultural
wage and sa lary workers . •
Manufacturing ..........•

Nonmanu facturing •......•

Mining .. . ••......... .
Construction • ••••.•••.•

October
1969p

September
1969

October
1968r

Sept.
1969

Oct.
1968

6,243,800
1,169,400
5,074,400
232,100
409,300

6,223,200
1, 164,400
5,058,800
234,300
409,400

6,027,100
1,127,000
4,900,100
228,900
403,700

0.3
.4
.3
- .9
.0

3.6
3.8
3.6
1.4
1.4

46 1,900
1,424,400
309,000
964,900
1,272,800

466,600
1,419,900
308,900
966,700
1,253,000

443,400
1,365,800
292,500
918,100
1,247,700

- 1.0
.3
.0
-.2
1.6

4.2
4.3
5.6
5.1
2.0

Transportation and

public utilities ...... . .

Trade ••••..•. •.•••. ..
Finance . .. ............

Service ... .. ... . .. .. ..
Government •.•........

Ariz.ona , louisiana , Now Mexico, O klahoma, a nd Texas.
p Preliminary ,
r - Rev ised .

1

SOURCE: State employment ogencies .

4

October
Area and type of index

1969p

September

August

O ctober

1969

1969

196B

177.5
202.3
226.6

166.5r
189.9r
203.7r
180.6r
123.4r
213.9r
166.0r
167.8r
169.3
165.9r
120.7
208.9r

TeXAS
Total industrial production ......
Manufacturing .... • .. •• .. . .... .

Durable .•••. ....... • . .••...•
Nondurobl . .. ..... . . .........
Mining ••.........••.......•. .
U ti litie s. ........... . ...•.. .. . .

179. 1
203.5
226.8
187.9
131.1
247.9

128.5
247.9

175.6r
199.0r
222.6r
183.3r
127.3r
254.1r

173.3
174 .2
177.5
170.2
130.2
224.5

173.9
175.1
178.5
170.7
130.7
222 .4

174.3
175.4r
178.5r
171.6r
131.2r
222.6r

186,0

UNITED STATES
Total industrial production ......
Manufacturing .................

Durable ••••...•••.••..• • .• • •

Nondurab/o . ... ... . . . .. ......
Mining . ••..... . ..••..• . ... .. .

Utilities .•••...••......• •••• ..•
p -

r-

Preliminary.
Rev ised .

SOURCES: Boord of Gov.rnars of the Federal Res.rve System.
Federal Reserve Bonk of Dallas.

annua
s a emen

Ideral reserve bank 01 dallas

FEDERAL RESERVE BANK
OF DALLAS

To the Member Banks in the
Eleventh Federal Reserve District:
The Statement of Condition and the earnings and expenses of the
Federal Reserve Bank of Dallas for the year 1969, with comparative
figures for 1968, are shown herein. Lists of the directors and officers of
the Bank and its branches as of January 1, 1970, are also included .
A review of economic and financial developments in the nation
and the District during 1969 is being presented in the January 1970
Annual Report Issue of the Business R eview of this Bank.
Additional copies of these publications may be obtained upon request
to the Research Department, Federal Reserve Bank of Dallas, 400 South
Akard Street (mailing address: Station K, Dallas, Texas 75222).

Sincerely yours,

P. E.

COLDWELL

President

statement 01 condition
Dec. 31, 1969

Dec. 31, 1968

$ 323,829,293
28,808,750
8,355,710
17,350,000

$ 344,103,657
43,242,700
11,513,277
5,300,000

957,783,000

798,246,000

1,350,352,000
150,402,000
2,458,537,000
2,475,887,000
713,580,280
8,241,229
130,812,358
$3,689,514,620

1,221,704,000
232,989,000
2,252,939,000
2,258,239,000
577,047,041
8,664,214

ASSETS
Gold certificate account . . . . . . . . .
. .. . . ........... . .. ....
Federal Reserve notes of other Banks . . . . . . . . . . . . . . . . . . . . . . .
Other cash
Discounts and advances . . . .. . .
U.S. Government securities:
Bills .. . . . . . .... . ...... . ........... . .. ........... . . .
Certificates . . ...
Notes ........... . . .. . . .. .. . . .. . . .. ... . . . . .. . .. . .. . .
Bonds . . ............ . ..... .
Total U.S. Government securities .
Total loans and securities ....... ... . ... . . ...... .. ... .
Cash items in process of collection .
Bank premises ...
Other assets ..
.. ....... .. .. .. ........ ...
TOTAL ASSETS .
. . .......... . .. . ...... . ..

137,692,922
$3,380,502,811

LIABILITIES
Federal Reserve notes in actual circulation . . .... .. .. . ... . .... $1,746,649,895
Deposits:

$1,575,001,366

Member bank - reserve accounts . . . . . . . . . . . . . . . . . . . . . . .. 1,222,308,848
U.S. Treasurer - general account .......... ....... . . .. . . .
81,124,900
Foreign .. ...... .
7,410,000
Other ..... .. . . .... . .......... . ........ .. .. . .. . . . . . .
13,485,313
Total deposits ........... .. . .
1,324,329,061
Deferred availability cash items ..
519,426,806
Other liabilities ......... . .
24,409,458
TOTAL LIABILITIES
3,614,815,220

1,229,4!48,111
572,920
12,540,000
10.624,865
1,253,185,896
464,327,688
16,456,361
3,308,971 ,311

CAPITAL ACCOUNTS
Capital paid in . .

37,349,700
Surplus ..... .. ....
. . . . . . . . . . . . . . . . . . . . . . . . . . . .. .
37,349,700
TOTAL CAPITAL ACCOUNTS . . . . . . . . . . . . . .
74,699,400
TOTAL LIABILITIES AND CAPITAL ACCOUNTS .. . . . . .. . ... $3,689,514,620

35,765,750
35,765,750
71,531,500
$3,380,502,811

earningS and expenses
1968

1969
CURRENT EARNINGS

Discounts and advances ..... . ........ . . . ........ . . .. . . ... $ 3,116,739
U.S. Government securities ...... .
134,495,990
F6reign currencies ...... . ...... . .
6,941,538
All other . . .... . . . ..... .
70,455
TOTAL CURRENT EARNINGS . .

144,624,722

$

1,215,553
112,264,985
4,364,788
34,700
117,880,026

CURRENT EXPENSES

Current operating expenses ................ . .

852,600

11,661,711
815,298

1, 193,511

969,695

20,685
15,389,433

13,462,664

960,534

905,737

14,428,899

12,556,927

130,195,823

105,323,099

342,921

461,514
495,107

13,322,637

Assessment for expenses of Board of Governors , , . , . . .. . .
Federal Reserve currency:
Original cost, including shipping charges . ..
, , . . .. . ,
Cost of redemption, including shipping charges .
Total . ...... , . . .. . . .... . , . . . ... .. . ,.
Less reimbursement for certain fiscal agency
and other expenses , ...... . .. . ..... .. .
NET EXPENSES . , . ... .. . .. .. . . . .. .

15,960

PROFIT AND LOSS

Current net earnings ... . .............. .
Additions to current net earnings:
Profit on sales of U.S. Government securities (net) , . .... . . .
All other ... .. . .............. ,.
Total additions

33,593

'... .......

-

- ----'--

Loss on sales of U.S. Government securities (net) . . . . . . . . . . .

255,237

342,921

Deductions from current net earnings:
All other . ..... . . . .. . .
Total deductions

4,304

13.040

259,541
83,380

13,040
482,067

130,279,203

105,805,166

2,205,326
126,489,927
1,583,950
35,765,750
Surplus, December 31 ... , .... ' . . . ........ , . , . . ...... . .. , $ 37,349,700

2,118,480
102,384,586
1,302,100

l . ... '

, . • • . . . • .

-----

Net additions ................ , ' .. .... . .
Net earnings before dividends and payments
to U.S. Treasury . . ........... ... .... .
Dividends paid . . ... . ... , .......... . . .. ... . ........... . .
Payments to U.S. Treasury (interest on F.R. notes) .... . . ... .. .
Transferred to surplus ... , .... . ...... .
Surplus, January 1 .. .

34,463,650

$ 35,765,750

directors
FEDERAL RESERVE BANK OF DAllAS
(Chairman and Federal R eserve Agent), Senior Vice President, Texas Instruments

CARL J. THOMSEN

Incorporated, Dallas, Texas

(Deputy Chairman), Pres ident, Humble Oil

& Refining Company, H ouston, Texas
President, University of Houston, Houston, Texas
President, The Peoples N ational Bank of Belton, Belton, Texas
Chairman of the Board, The First National Bank of Fort Worth, Fort Worth, Texas
President, Fox-Stanley Photo Products, Inc., San Antonio, Texas
President, The Peoples National Bank of Tyler, Tyler, Texas
President, EI Paso Natural G as Company, EI P aso, Texas
President and Chief Executive Officer, Texas Utilities Company, Dallas, Texas

CRAs. F. JON ES

G.

HOFFMAN
J. V. KELLY
MURRAY KYGER
CARL D. N EWTON
A. W. RITER, JR.
HUGH F. STEEN
C. A. TATUM, JR .

PHILIP

El PASO BRANCH
President and General Manager, Banner Mining Company, Tucson, Arizona
Vice President and Director, Farah Manufacturing Company, Tnc., EI P aso, Texas
President, The First National Bank of Midland, Midland, Texas
H. Y. Benedict Professor of Political Science, The University of Texas at El Paso,
E I Paso, Texas
President, The Security State Bank of Pecos, Texas
Presi dent, The Clovis National Bank, Clovis, New Mexico
President, EI Paso National Bank, EI Paso, Texas

ALLAN B. BOWMAN
GORDON W. FOSTER
C. J. KELLY
JOSEPli M. RAY
ARCHIE B. SCOrf
JOE B. SISLER
SAM D . YOUNG , JR .

HOUSTON BRANCH
President and Director, Eastex Incorporated, Silsbee, Texas
President, First Bank & Trust, Bryan, Texas
Chairman of the Board a nd Chief Executive Officer, Bank of the Southwest National
Association, HOllston, HOllston, Texas
Presi dent and General Manager, Peden Tron & Steel Company, Houston, Texas
President, The First Nationa l Bank of Port Arthur, Port Arthur, Texas
Chairman of the Board, Texas National Bank of Commerce of Houston, Houston, Texas
Presi dent and General Manager, Texas Farm Products Company, N acogdoches, Texas

R. M. BUCKLEY
H EN RY B. CLAY
A. G. McNEESE, JR.
GEO. T. MORSE, JR.
W. G. THORNELL
JOHN E. WHITMORE
M. STEELE WRIGHT, JR.

SAN ANTONIO BRANCH
Veterinarian and R ancher, Brackettville, Texas
Presi dent, Corpus Christi Bank and Trust, Corpus Christi, Texas
President, The Frost N ational Bank of San Antonio, San Antonio, Texas
President, Union National Bank of Laredo, Laredo, Texas
General Manager and Partner, Knowlton's Creamery, San Antonio, Texas
Professor of Business Statistics and Consultin g Statistician to the Bureau of Business Research,
The University of Texas, Austin, Texas
President, First National Bank at Brownsville, Brownsville, Texas

W. A. BELCH ER
JAMES T. D ENTON, JR.
TOM C. FROST, JR.
RAy M. K ECK, JR.
LLOYD M. KNOWLTON
FRANCIS B. MAY

W. O. ROBERSON

FEDERAL ADVISORY COUNCil MEMBER
JOHN

E . GRAY

I

Chairman of the Board and Chief Executive Officer, First Security National Bank oC
Beaumont, Beaumont, Texas

Onicers
FEDERAL RESERVE BANK OF DALLAS
E.

P.
T. W.
L. CAUTHEN, Senior Vice President
and Controller

COLDWELL,

PLANT,

President

First Vice President

JA MES

L.

J.

COOK,

ARTHUR

COWAN,

Vice President

RALPH T. GREEN,

Vice President

CAUL

H.

HARRY

E.

E. A.

ROllINSON, JR.,

Assistant V ice President

THAXTON, JR.,

Assistant V ice President

JAM ES
PARK ER,

V ice PresideJlt

M. PRITCHEIT,

Vice President

IAMES

A.

T.

W.

F REDRIC

W.

R EED,

Vice President, Cashier,
and Assistant Secretary of the Board

VORLOP, JR.,

RUSSELL,

SPRENG,

JESSE

Vice President

Data Processing Office r
Assistant Cashier

INGRAM,

Assistant Cashier

D.

SANDERS,

Assistant Cashier

C. L.

Vice President

Chief Examiner

D.

RICHARD

TONY J. SALVAGGIO,

E. W.

E.

O.

SIDNEY J. ALEXANDER, JR .,

Vice Presidelll

THOMAS R. SULLIVAN,

General COllnsel

Assistant Vice President,
Assistant Counsel, and
Assistant Secretary of th e Board

V ice President

MOORE,

General A uditor

G EORG E C. COCHRAN, III,

H. BOYKIN, V ice President
and Secretary of the Board
W.

LANG,

GEORGE F. RUDY,

Senior Vice President

ROB E RT
LEON

H.

ROB ERT A. BROWN,

VrcK,

Assistant Cashier

Assistant General Auditor

EL PASO BRANCH
FREDRIC
FORREST

E.

COLEMAN,

W.

R EED,

V ice President in Charge

Cashier

T HOMAS H. ROB ERTSON,

Assistant Cashier

HOUSTON BRANCH
J.
RASCO R. STORY,
J.

Z.

ROWE,

L.

COOK,

Senior Vice President in Charge

Cashier

JOHN

Assistant Vice President

R.

N.

AINSWORTH,

Assistant Cashier

J. SCHOENHOFF,

Assistant Cashier

SAN ANTONIO BRANCH
CARL

H.

MOORE,

F REDERICK
THOMAS C. COLE,

Assistant Cashier

Vice President in Charge
J.

SCHMID,

Cashier
ROB ERT

W. SCHULTZ, Assistant Cashier