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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 I o 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 r: ILdJ \ . \.oJ 9.000 8.800 :l CRUDE OIL PRODUCTION • +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 35,878 0 946,782 54,097 0 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 .. 134,359 623,996 136,191 116,723 620,971 154,99 1 All other ...... . ... ............ ..... ... . 33,0 13 1,391,881 34,142 1,238,908 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) ..•..•...•.. . .. • .. ..•..... 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 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 •.••..•..• .. ..••. 179,9 15 636,276 263,5 15 30,299 1,396,799 Oct . I, 1969 RESERV E CITY 8'ANKS 1,127,828 48,122 0 Loons to nonbank Anencial institutions: Sales flnance, personal flnance, foctors, and other business credit companies ••• .. .. Other ..•................. ..• •••. ...• .• 4 weeks en d e d 0 616,324 2,617,046 purcha sing or carrying : Other loan s for purchasing or carrying: U.S. Government securities ••.... . . ... . .... 302,755 5,973,273 ---- 5 weeks e nded Nov. 5, 1969 Item Nov. 27, ---930,424 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 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 359,438 ---- ---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 (Annual · rate Septemb er basis) Standard metropolitan stati stical oreo 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 ----------------Septem b er October Octob e r October 31, 1969 -4 19 20 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 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 1969 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 -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 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 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 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 •• 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 -37 57 LOUISIANA Monroe-West Monroe .... . Shreveport .... TIME DEPOSITS GROSS DEMAND DEPOSITS VALUATION (Dollar amounts in thousand s) - - - - - ------$ 123,366 $ 1,309,674 Total-26 cities • • 12,957 113,975 - 11 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 (In thousands of boles - FIVE SOUTHWESTERN STATES' 1969, 1969, 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 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 .. .. . . ..... Barley . ... ..... Rye ............ Ric e ' .. .. ... .... Sorghum gra in •.. Flaxsee d ...... . Hoy· ........... Peanuts6 •.••• •• • Irish potatoes G••• 500 pound. gross weight) 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 . 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 October 1969 Area FOUR SOUTHWESTERN STATES .... .. .. ..... .... Louisiana •• • ••. ••• ..••• • New Mexico • •••. . . .. . ... Okla homa •• • ...... • •..• Texas ........ . .. . .. .. . . Gulf Coast ............ West Texas ....... . . . . East Texas (proper) ••.•• Panhandle • • •.•• •• ••. . Rest of State .......... UNITED STATES ............ September September 1969 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 1968 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 Percent cha nge Second quarter Area FOUR SOUTHWESTERN STATES .. . .............. l ouisiana . ..... . ... ..... Offshor........ . ...... Onshore ......•....... New Mexico •••.......... Oklahoma •••.•..•.••••• Texas ............•.... . Offshore • •. ...••...•.. O nshore .. ..... .... . .. UNITED STATES .......... .. First quarter 1969 October 1969 October 1968 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 CAUL H. HARRY E. E. A. ROllINSON, JR., Assistant V ice President THAXTON, JR., Assistant V ice President V ice President MOORE, JAM ES PARK ER, V ice PresideJlt M. PRITCHEIT, A. T. W. O. RUSSELL, Vice President IAMES F REDRIC W. R EED, Vice President, Cashier, and Assistant Secretary of the Board VORLOP, JR., 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. SIDNEY J. ALEXANDER, JR ., Vice Presidelll THOMAS R. SULLIVAN, General COllnsel Assistant Vice President, Assistant Counsel, and Assistant Secretary of th e Board Vice President RALPH T. GREEN, 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
