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MONTHLY BUSINESS REVI EW of the fEDERAL RESERVE BANK of Dallas ~~============================================================================================= VOlume 29 Dallas, Texas, November 1, 1944 Number 9 ~~======================================================================================== DISTRICT SUMMARY Consumer buying at department stores increased by a smaller ~rnOunt than is usual between August and September and the ~n~rease of 14 per cent over September last year was slightly T~ow the average gain for the first eight months of the year. , e value of construction contracts awarded in this district ~ncreased further in September and was 65 per cent larger than In September last year, but total awards for the first nine :onths. of 1944 were 57 per cent lower than in the correspondg penod of 1944. Awards for residential building reached a ~ew low level in September. Crude oil production during Sepber reached a new peak for the fifth consecutive month, but ~ ~w,able production for October has been reduced moderately i~ nn~ ?'!tput i? line with available transportation and re~n p g faCIlIties. Rams during September and early October Imt ro;ed crops and ranges. Harvesting operations are being rear ed by acute labor shortages in many areas. il BUSINESS t ,The dollar volume of sales at department stores in this disrlCt ~mg September was 14 per cent hlg ler t han a year ago, 'I but du' Ie the mcrease of 17 per cent from the preceding month was s.:s than the usual seasonal amount. Sales at weekly reporting C ms for the three week period ended October 21 were 13 per n~nt above those for a similar period last year, During the first ;~: nlonths of this year sales at all reporting department stores a 16 per cent higher than those for the comparable period ear ago, Increases in sales during this same period ranged d ~112 per cent at San Antonio to 22 per cent at Dallas. The 51? hal' volume of stocks at the end of September decreased h'Igh tly f rom t hat a month earlier and was about 3 per cent Ig er than a year ago. f/ gr The dollar sales of women's and misses' suits have shown eater of consistent gains in the past several years than the sales ' ' su' any other Item reported. Ann ual sales of women ,s an d misses , do;~s :,ere practically the same in 1939 and 1940, but after 1940 ap ar s,ales of these items increased to a volume in 1943 equal to "'hpro~mately 3.7 times that of 1939. This is more significant w en ' , th d' It ,IS noted that total dollar sales at department stores 10 Pucrt hstnct in 1943 were approximately 1.9 times those in 1939. nin ermore, sales of women's and misses' suits during the first Ye e months of this year were 23 per cent above those of a ar ago. f r Sales at furniture stores in September increased 7 per cent thom the preceding month and were 11 per cent above sales ill abe same month last year Stocks at the end of the month were OUt th • bel he same as those a month earlier, but were 3 per cent tu Ow t ose a year ago. Although the supply of steel for furni. . . ' in re manu f acturmg h as improved, wood IS becoxrung mcreasI g Y scarce. ACcord' ' fa'l lng to Dun and Bradstreet Incorporated, one b US10esS ~re oCcurred in this district in Se~tember with total liabilities rep 2,032.,000. Although only two business failures have been faij°rted In this district this year as compared with 11 such ures . h I' IltleS of th d unng the first nine months of last year, tela b'l' , re e defaulting firms in 1943 were only 13 per cent of those Ported this year. 0/ AGRICULTURE The Department of Agriculture reported on October 1 that if the weather and labor shortages did not unduly interfere with the tremendous harvesting job, this year's crops may rank with those of 1942 as the greatest ever produced in the United States. Widespread rains during September and the first week of October relieved drouth conditions in most sections of the Eleventh District except in scattered areas in New Mexico and in Arizona, where ranges are dry and feed reported short. Growing crops responded to the more favorable moisture Conditions with the result that prospective production of some Texas crops was slightly higher on October 1 than a month ago. The forecast indicated increases in production for COtton sweet potatoes, rice and pecans, with no changes indicated ~ estimates for ' other crops, except a decrease in production of tame hay. Range feeds and pastures were greatly improved and the seeding of winter wheat and other small grains proceeded under generally favorable conditions, with many fields reported up to a stand and making good progress. On October 1, the 1944 Texas cotton crop was estin1ated by the Department of Agriculture at 2,500,000 bales, which was 50,000 bales above the September 1 estimate but about 300,000 bales below the 1943 harvest and nearly 800,000 bales below the 1933-1942 average harvest of 3,273,000 bales. The estimate for the Eleventh District was placed at 3,215,000 bales, as compared with actual production of 3,578,000 bales in 1943. The indicated cotton production in Arizona, New Mexico and Oklahoma is expected to be substantially larger thall in 1943, while the expected crop in Texas and Louisiana is considerably smaller. A United States cotton crop of 11,953,000 bales was forecast for 1944, as compared with 11,427,000 bales produced in 1943 and the 1933-1942 average of 12,455,000 bales. The indicated yield of cotton per acre in 1944 is smaller in Texas and Louisiana but substantially greater in Arizona, New Mexico and Oklahoma, with the 1944 expected yield per acre in all five states exceeding the 10-year average. The per acre yield of approximately 285 pounds in the United States is the highest of record. General rains or intermittent showers retarded cotton harvest in most areas in Texas and caused some damage to grades in sections where cotton had opened rapidly. While the improved moisture supply had increased prospects in some northwestern counties, dry weather is needed in most other areas to enable farmers to save the matured crop. A oritical shortage of cotton pickers is reported in most of north, central, western and northwestern counties, and the movement of cotton is being generally slowed down due to acute labor shortages at gins and compresses. As reported by the Bureau of the Census, total ginnings in Texas through September 30 were 720,780 bales, as compared with 1,470,900 bales through the same date a year ago, reflecting the general lateness of the crop and the unfavorable harvesting conditions. Yields of all tame hay were somewhat lower than earlier expectations and the October estimate of 1,331,000 tons is 74,000 tons lower than the previous forecast. The outlook for sweet potatoes in Texas improved with the September rains and a prospective crop of 4,875,000 bushels is now indicated, as compared with 4,420,000 bushels forecast a month ago, but is This ublication was digitized and made available I?Y.. the Federal Reserve Bank if Dallas' Historical library (FedHisto @dal. rb,o 2 MONTHLY BUSINESS REVIEW still considerably below last year's harvest of 5,616,000 bushels. Rice prospects, which had declined due to earlier lack of moisture, are much better than previously reported, with production now indicated at 19,208,000 bushels, as compared wi~h the September 1 forec ast of 17,640,000 bushels. The prospective pecan crop was indicated on October 1 at 45,000,000 pounds, and, if realized, will exceed the 193 5 record crop by 1,000,000 pounds. Fall and winter commercial vegetable cultivation in the Rio Grande Valley and Coastal Bend districts was active under mostly favorable weather condlitions with fall carrots and tomatoes making good progress and prospects favorable for seeding additional fields and transplanting of other crops. The intended acreage of south Texas onions for harvest in 1945 is estimated to be 79,600 acres, or 13 per cent above the 70,600 acres harvested in 1944 and 75 per cent higher than the 10-year average. The 194,5 acreage, if realized, will be about the same as the record high established in 1936. Citrus groves responded rapidly to the September and early October rains and the initial forecast for the 1944-1945 season placed grapefruit production at 20,150,000 boxes and orange production at 3,750,000 boxes, as compared with a production of 17,710,000 boxes and 2,550,000 boxes, respectively, from the 1943-1944 crop. Rains in practically all parts of Texas have greatly improved range feeds and pasture grasses and range conditions on October 1 were reported at 86 per cent, an improvement of 9 points during the month. Prospects for fall and winter grazing are favorable in all major areas with some seeded and volunteer wheat acreage already up to a stand. Stock water supplies have been replenished in all except a few local areas where rains fell too slowly to cause sufficient run-off. Moreover, moisture supplies are adequate over most of the district to sustain the growth of grass and other feeds. Cattle continued to show gains, reflecting the revival of range and pasture grasses and the reported condition of 84 per cent on October 1 is the same as the 20-year average. Sheep and lambs also improved during September and the condition of 85 per cent is five points above that a month earlier and one point above the 20-year average. Local demand for cattle and sheep for restocking and other purposes has been light, but due to the excellent prospects for wheat pastures and the abundant crop of grain sorghums and other feeds in the Plains sections,. a material increase in feeding is expected. Generally fair progress with fall shearing of sheep is reported, although handicapped by labor difficulties. The movement of livestock to market has been irregular, due to weather conditions, but the total movement is still relatively large. During September, receipts of cattle, hogs and sheep at the Fort Worth and San Antonio markets declined, while those of calves rose to the highest level of the year. Marketings of sheep since April have been exceptionally heavy and while September receipts were sharply lower than in September last year the total receipts for the first nine months of 1944 were much larger than the heavy movement in that period last year. Likewise, the total receipts of cattle, calves and hogs for the first nine months of 1944 were larger than during the same period in 1943. Cash farm income from crops and livestock in Texas during July totaled approximately $77,790,000, which represents a decline of over 18 per cent from the preceding month but is 12 per cent higher than for July, 1943. Moreover, the aggregate cash farm income of $563,422,000 in Texas for the first seven months of 1944 was slightly over 6 per cent more than the $530,956,000 received during the same period in 1943. Prices received by Texas farmers during September, as reported by the Department of Agriculture, reflected significant increases in prices for most livestock, alfalfa hay and eggs and slight gains were indicated for cotton, oats, wheat, butter and chickens. On the other hand, continued moderate declines were shown for most Texas grain crops, wheat and oats excepted, and sweet potatoes declined sharply as new crop supplies became more plentiful. Prices received for such items as peanuts, Irish potatoes, cottonseed, hay and dairy products remained unchanged from the previous month. As a whole, crop CASH FARM INCOME- (ThouSlluds of dollnrs) - - July 1941 -~----Totnl receipts ~Receipts from~ July July January 1 to Jul y 3.1 Crops Livestook" 1044 1043 1944 1943 6,815 2,210 9,025 6,680 83,401 80,304 Arizona . . .... . ... .... . . . 1,518 4,535 6,053 6,954 83,425 73,413 Louisiana . .. , .. .. . . ... . . . 3,484 2,567 6,051 5,976 35,022 40,257 New Mexioo . . . .. .. . •• . . . 23,488 51 ,846 41,627 221,344 184,579 Oklahoma . . .... ...... .. . 28,363 44,257 77,792 60,323 563,422 530,956 Toxns .... ... . .. ... . .. . . . 33,535 77,052 150,767 130,560 986,614 Total. . . .... . .. . 73,715 -Includes recoipts from the sale of livestock nnd livestook products. SOURCE: United States Depnrtment of Agriculture. 809,569 LIVESTOCK REOEIPTS- (Numbor) - - - F o r t Worthl ---~-- Sau Antonio Sept. Sopt. August Sept. Sept. August 1044 1943 1944 1044 1043 1044 107,960 116,853 22,622 18,813 28,181 Cattlo .... .. ............ . 104,567 42,915 52,907 80,561 27,438 20,575 Calvos ... . .. . .... . ..... . 56,687 67,512 71,657 68,127 11,986 11,831 14,932 177,204 249,355 209,764 51,053 45,887 57,676 ~bC~~:: :: ::::::::::::::: COMPARATIVE TOP LIVESTOCK PRICES (Dollars per hundred woight) - - - F o r t Worth---~-- Sau Antonio Sept. Sept. August Sept. Sept . August 1044 1043 1044 1944 1943 1044 $14 .00 $14 .05 $12.25 S12 .75 $14.00 Beof steers .. ... . . . .. . ... . $14.25 12 .50 11.50 teers .. . .. ... ... . 12 .00 Stocker B 14.25 14 .50 . i2:25 .i:i:oo .iiJ :5o Hoifers nnd yearlin gs . . . . . 14.00 11 .25 12 .00 10.50 11.00 11.00 Butcher cows .. . ..... ... . 12.25 Calves . .... . .... . ..... . . 13.25 13 .00 18.50 13.25 13.00 12 .65 14.55 14 .80 14.55 14.25 14.25 14.25 14.00 13.50 14.00 12.50 12 .00 E:':b~:::::::::::: : : : :: : COTTONSEED AND COTTONSEED PROIilUCTS Texns United StatesAugust I to Septembor 30 Au~ust 1 to September 30 Last Beaeon This BOMon Th is Benson Last senson Cottonseed reoeived at mills 219,034 (tous) .. . ... .... ... . ....... 400,505 1,070,876 1,555,391 03,700 Cottonseed crushed (tons) . .. . . 171,954 637,572 453,058 Cottonseed on hand Sept. 30: 156,980 (tons) ........ .. ........ .. . 273,3 JO 735,174 1,008,155 Produotiou of products: 26,R53 192,670 Crude oil (thousand Ibs.) . .. . 48,735 135,164 44,385 Cake and meal (tons) ....... 287,449 79.378 202,348 21,579 Hull. (tons) ... . .. ......... 40,598 109,156 151,681 Linters (running bales) .. .... 28,868 190,046 52,227 120,654 Stooks on hand Sept. 30: 7,951 Crude oil (thousand Ibs.) .... 14,1100 87,790 58,133 Cal,o and meal (tons) . . ..... 16,013 48,871 17,428 60,523 Hulls (tons) ..... , .. . . . .... 9,368 30,890 12,964 34.474 10,812 Lintors (running bales) ... . .. 55,550 75,937 178,463 SOURCE: United States Bureau of Consus. DOMESTIC CONSUMPTION AND STOCKS OF COTTON-(Bales) September 1944 Con.umption at: Texas mills . ... . ... . .. ... 15,415 703,086 United States mills . . ..... U.s. stoeks-cnd of month: In oonsuming estabm'ts .. . 1,713,063 Public slg. & compresses .. 9,776,490 September 1043 18,294 872,155 August 1044 17,078 841,490 Au ~ust 1 to Septembor 30 Th,. senson 38,393 1,034,576 La.qt sonson 37,085 1,726,532 1,931.489 10,433,070 CROP PRODUCTION-(Thousands of units) Crop Winter wheat............ Cotton.. ... ............. Corn".. .. .. ........ .. .. Oats . .... . ....... .. . ..... Barley ............ .. ".. Tame hay . .... .. . . ..... . Potutoos. Irish. . . . . . .. . .. Potatoes, sweet. . . . . . . . . . Rice... . ..... . ..... . . . .. "Ari, onn, New Mexico, tToxns and Louisin"a. - - - Texas - - -- Eleventh Distriot-Estimated Estimated Unit Oct. I, 1944 1943 Oot. 1, 1944 1943 Bushols 77,071 30,360 78,111 37,142 Brues 2,500 2,823 3,215 3,578 BUBnel. 64,640 88,416 76,559 102,088 Bushels 42,471 21,780 47,995 26,1 L1 Bushels 8,428 3,341 17,8819,370Toos 1,331 1,469 1,010 2,018 Bushels 5,016 6,450 6,006 7,504 Bushnls 4,875 5,616 14,540t 15,072t Bushels 19,208 20,190 40,G20t 44,104t Oklahoma and TeXllS. tLouisilWa, Oklahoma and 'rcxas, BOURCE: United Slates Dopartmoot of ~. MONTHLY BUSINESS REVIEW prices were slightly above levels for the same month last year, while prices received for livestock and livestock products were generally below those a year ago. On September 23, the War Food Administrator announced that, effective as soon as necessary arrangements can be made and until June 30, 1945, the War Food Administration will offer to purchase through the Commodity Credit Corporation from farmer producers at parity prices, all cotton of the 1944 crop for which a loan schedule has been announced and which lUay be placed in acceptable storage and tendered to it. FurtherlUore, the cotton sales policy which was announced on August 26, 1944, will be modified so as to permit the Commodity Credit Corporation to sell cotton at not less than parity. The Surplus Property Act of 1944, which was approved on October 3, gave the War Food Administration broad powers with respect to the disposal of surplus agricultural commodities and gave the Commodity Credit Corporation authority to disposal of surplus agricultural commodities for export only at competitive world prices. Later the Commodity Credit Corporation announced that Industry Advisory Committees had agreed On general principles to govern cotton and wheat subsidy programs designed to regain for the United States its share of the world market and to bring about the sale of surplus and competitive world prices. FINANCE The Secretary of the Treasury has announced that the Sixth War Loan Drive will begin November 20 and that the goal will be $14 billion of which $ 5 billion is expected to be obtained from individuals. The "basket" of securities to be offered during the drive is identical with that offered during the Fifth War Loan Drive. In accordance with the announcement made on August 29, the United States Treasury inaugurated on October 2, a simplified plan for redemption of savings bonds, Series A to E, inclusive, through incorporated banks and trust companies which qualify to render that service. In instituting the plan, the Treasury desired to make it easier for holders of savings bonds who are in need of funds to avoid inconvenience or delay in cashing the securities. Since many holders cash their bonds in anticipation of an actual financial need that may not occur, the new policy should have the effect of deterring redemptions somewhat. Moreover, the new procedure should encourage sales of Series E bonds to individuals who have excess cash on hand, since the investor is provided the facility for cashing the bonds immediately in the event of an emergency. The gross deposits of weekly reporting banks in leading cities of this district declined $35,000,000 between September 13 and October 11, after having increased by about $288,000,000 during the preceding four months. During the last four-week period there were withdrawals of $41,200,000 from Government accounts and of $16,400,000 from adjusted demand deposits, which were only partially offset by increases of $17,600,000 in interbank deposits and $4,800,000 in time deposits. The reduction in adjusted demand deposits reflected in part the payment of quarterly income taxes. The funds to meet the deposit withdrawals were obtained principally through a decline of $4,100,000 in loans and investments and through a reduction of $27,900,000 in balances with correspondents. During the four weeks ending October 11, the weekly reporting member banks expanded their total loans by $6,200,000. The largest increase occurred in commercial, industrial and agricultural loans, which showed the first indication of the expansion that usually takes place during the fall months. The 3 other major increase occurred in "all other" loans that include instalment loans to consumers. The increases in these loans were partially offset by the decline in loans secured by Government securities to others for security trading. In contrast with the rise in loans, the total investments of these banks declined to $1,211,000,000 on October 11, a point $25,100,000 below the peak reached in mid-August. Between September 13 and October 11, holdings of Treasury 'bonds were reduced by $7,800,000 and those of Treasury bills by $5,900,000. On t he other hand, these banks increased their holdings of certificates of indebtedness by $3,600,000. Reserve balances of member banks in this district reached a new peak on October 14 of $591,100,000, and the average for the first half of the month amounted to $582,000,000 which is $11,000,000 above the average for September and $101,000,000 above that for October, 1943. Since August the usual contraction of excess reserves which follows War Loan drives has been apparent even though reserve balances have remained at a high level. Owing to the shift of deposits from reserve-exempt War Loan accounts to private deposits requiring reserves, an increase of $44,000,000 occurred in required reserves from the low point reached the first of July. This increase is expected to continue until the sale of marketable securities begins for the Sixth War Loan Drive. Federal reserve notes of this bank in actual circulation reached a new peak on October 13 of $509,000,000. This amount is nearly six and one-half times our circulation in June, 1940, when the National Defense Program was inaugurated. Following the exceptionally rapid rate of expansion during 1942 and most of 1943, there has been a decline in the rate of increase. In fact, the net increase in circulation during the first nine and one-half months of this year amounted to $93,000,000 as compared to $122,000,000 during the comparable period of 1943. INDUSTRY The value of construction contracts awarded in the Eleventh District, which had evidenced a downward trend during 1943 and the first seven months of 1944, turned upward in August and showed a further slight increase during September. Total awards during September amounted to $17,265,000, as compared with $10,346,000 for September last year, but the aggregate of $123,884,000 for the first nine months of tllls year is about 57 per cent below that for the same period in 1943. The recent increases in awards have occurred in contracts for nonresidential, public works and public utility construction, while residential construction has continued to decline sharply, and in September were at the lowest level for any month in the 20 years for which data are available. Awards for additional war industrial facilities have been a factor in the larger volume of non-residential building but work in connection with the repair and modernization of commercial buildings is increasing in importance. From available information it appears that public utility construction, road building and street improvement programs are expanding and may increase further as materials and labor become more plentiful. Production of 554,000 barrels of Portland cement at Texas nUlls during August was slightly above the output for July, but during recent months, the excess shipments over production reduced mill stocks to 837,000 barrels on August 31. Daily average crude oil production in this district during September reached a new high for the fifth consecutive month, with an average output of 2,332,900 barrels daily, exceeding that in August by about 2 per cent and that of September last year by 16 per cent. Production of crude oil outside this district increased only slightly, less than 1 per cent, over the previous MONTHLY BUSINESS REVIEW I month and was about 3 per cent above the production for September, 1943. The west Texas and southwest Texas fields continued to show the largest increase in production with daily averages of 17,800 barrels and 18,700 barrels, respectively, above the production in the preceding month. On September 22 the Petroleum Administration for War announced that a produ£tion rate of 5,010,800 barrels daily of all petroleum liquids had been certified to the various oil producing states for October, representing a net decrease of 40,50 0 barrels daily from the rate certified for September. The certification for Texas called for a net reduction during October of about 25,000 barrels daily, which is in line with actual requirements based on available transportation and refining facilities. According to a recent announcement by the Petroleum Administrator, the production of 100-octane aviation gasoline in the United States has reached a daily average of 525,000 barrels and the October output will exceed allied combat and traini ng requirements for the first time. Crude oil stocks in the Eleventh District decre~ed frac tionally in September, but the total of 118,218,000 barrels at the end of the month was about 2 per cent larger than a year earlier. On the other hand, a decline of approximately 13 per cent in crude oil stocks outside this district during the past year, reduced total United States stocks at the end of September this year to 222,390,000 barrels, or about 5 per cent below those a year ago. Drilling activity in the Eleventh District was maintained at about the same rate in September as in the previous month, with an average of approximately 19 well completions daily. The Petroleum Administrator has recommended that a minimum of 27,000 oil and gas wells be drilled in the United States during 1945, of which 5,000 should be exploratory wells, in order to ease the strain upon the productive capacities of the nation's oil fields. This recommendation calls for 3,000 more wells than were scheduled for 1944 and even more would have been requested except for the shortage of materials and manpower . • Despite price increases at mill level aggregating about 10 per cent above ceiling prices for all fine cotton goods and efforts by several Government agencies to increase cotton textile output, production continues to be far below total requirements. Cotton consumed at United States textile mills in September, which totaled 793,086 bales, showed a decline of 6 per cent frorn August consumption, and was 9 pet cent smaller than that consumed in September a year ago. The War Production Board reported that textile production for 1944 was estimated at 9,000,000,000 yards, as against requirements of 12,000,000,000 yards, with the greatest shortages being in the field of cotton duck. With virtually all mill production now being taken up in Government and high priority orders, acute shortages of all cotton textile items for the civilian consumer is likely to continue until the labor situation at the mills greatly improves. Stocks of cotton on hand in consuming establishments at the end of September totaled 1,714,000 bales, as compared with 1,931,000 bales in September last year, indicating a decrease of 11 per cent. Stocks held in public storage and compresses on September 30 were 9,776,000 bales, which was about 6 per cent below the amount gn hand at the end of August and 6 per cent under the 10,433,000 bales held on September 30, 1943. Cottonseed receipts at Texas cottonseed oil mills during September totaled 139,000 tons, representing an increase of 73 per cent above receipts in August, but were about 42 per cent below the receipts for the same month a year earlier, reflecting the slow progress in the picking and ginning of cotton. Although total crushings in September showed a seasonal increase over August, the total was 49 per cent less than in September a year earlier. During September the production of cottonseed oil, cake and meal, hulls and linters, while showing sharp increases over August, averaged about 48 per cent below the production in September, 1943. Stocks of crude oil, dke and meal, hulls and linters on hand at Texas mills increased during September, but at the end of the month stocks of all products, with the exception of cake and meal, were sharply lower than those on September 30, 1943. MONTHLY BUSINESS REVIEW NOVEMBER I, 1944 NATIONAL SUMMARY OF BUSINESS CONDITIONS (Compiled by the Board of Governors of the Federal Reserve System) INDUSTRIAL PRODUCTION ~~-- .--~~-" -~"r~i=.==~===~-~~ :~f -1--'(---I---+--l~-~.~120 rC - \I- r-r--I--+--+--+--- 'eO: ~=-:I--_=I_-+--+---+-+-1937 1936 19'39 1940 1941 1942 1943 ::: 120 ~: L944 Federal Reserve index. Monthly figures,latest sbown is for September. - INCOME PAYMENTS TO INDIVIDUALS ,___ - 'CIIoI Ot 160 DIII.~'~1 :C::'F-'- I 20 Ir' '.0 r-r- -- 100 eO ~ V -; -- f-- f-- 120 TOTo\l, /- I-- - f- '-- ./. .~.V- "NO'U"U f- f1- V j,.J I 00 -.- e-- '-- -I/ r l....-____ 60 .........:,~'~ ------.; ,-'l r"'j 60 1940 1044 1940 BO 40 20 1944 1042 Based on Department of Commerce estimates. Wages and salaries include military pay. Monthly figures raised to annual rates, latest shown arc for September. WHOLESALE PRICES Output at factories and mines in September and the early part of October was maintained close to the August level. Value of department store sales continued to show increases above last year. There were mixed movements in commodity prices with a sharp decline in the price of steel scrap. INDUSTRIAL PRODUCTION Industrial production in September was 231 per cent of the 1935-39 average, according to the Board's seasonally adjusted index, as compared with 232 in August and 230 in July. Activity in most industries manufacturing durable goods showed slight decreases in September and there were further large declines in production of aluminum and magnesium. Steel output averaged 93.4 per cent of capacity, somewhat below the August rate, but showed an increase during the first 3 weeks of October. Easing of military demand for steel led to some increase in allocations for civilian production during the fourth quarter. Aircraft production and output in the automobile industry were maintained during September at the level of the preceding month. Output of texcile and leather products continued to increase in September from the reduced July level. Shoe production advanced to the highest rate reached since the spring of 1942. Output of manufactured food products, as a group, was maintained at the level of the preceding month after allowance for seasonal change. Butter production continued about 15 per cent below last year. Hog slaughter declined further in September, while catde slaughter continued to increase more than is usual at this season and reached a record rate for the wartime period-about 50 per cent above the 1935-39 average. Beverage distilleries resumed production of alcohol for industrial purposes in September after turnin g out an exceptionally large amount of whiskey and other distilled spirits during August. Crude petroleum production contillued to rise in September, while output of coal and other minerals showed litde change. DISTRIBUTION Department store sales in September showed about the usual large seasonal increase and were 14 per cent larger than a year ago. In the first half of October sales rose sharply and were 16 per cent above the high level dut prevailed in the corresponding period last year, re£lecting in part the greater volume of Christmas shopping prior to the overseas mailing deadline. Carloadings of railway f reight during September and the first half of October were slightly lower than a year ago owing to decreases in shipments of raw materials, offset in part by increased load ings of war products and other fi nished goods. COMMODITY PRICES Prices of grains and some other farm products were higher in the third week of October than in the early part crf September and there were scattered increases during this period in wholesale prices crf industrial products. Prices of steel scrap and nonferrous metal scrap, however, declined; steel scrap was reduced from ceiling levels by 3.40 dollars per ton, or 18 per cent, to the lowest prices offered since August, 1939. AGRICULTuRE Crop production in 1944 will rank with 1942 when the largest production in history was harvested. Corn production is estimated at 3.2 billion bushels; this, together with other feed grains, wheat, and good pastures, will go far to prevent too rapid marketings of livestock. Commercial truck crops for the fresh market will not only exceed 1943 production but appear likely to exceed the 1942 rcoord by about 11 per cent; deciduous fruit production is about 20 per cent above 1943, and citrus fruit production may equal or possibly exceed that of last year in spite o, recent storm damage. f 1 939 1 940 1 ' 94 1 942 1943 1 944 Bureau of Labor Statistics' indexes. Weekly figures, latest shown arc for week ending October 21, 1944. GOVERNMENT SECURITY HOLDINGS OF BANKS IN LEADING OITiES ... .,nIU ••r UOII.O'DOUUI 20 15 10 25 I I T - j'~ r-' -"-- 20 c----~* , -1 ' ""' I _ _ _.l I ---' I :~ """",,':i t----- - ;-rt~ \ .:-~~~~'--(-==:~~~ ___ l r-- 11)39 1940 1941 1942 IILL. 1943 1 944 Excludes guaranteed securities. Data not available prior to February 8, 1939; certificates first reported On April 15, 1942. Wednesday figures, latest shown are for October 18, 1944. BANK CREDIT Expenditures by the Treasury of fund s received during the Fifth War Loan Drive continued in large volume during the !:ttter half of September and the first half of October, and United States Government deposits at banks declined. Time deposits at weekly reporting banks in 101 leading cities rose by about 300 million dollars in the five weeks ended October 18, and demand deposits of business and individuals, which decreased somewhat in the latter part of September partly as a result of tax paymentS, increased again in October. Currency in circulation increased by 660 million dollars in the five weeks ended October 18. This unusually large out£low of currency may have been associated with purchases of overseas Christmas gifts during the period. Reporting banks in 101 cities reduced their Government security holdings during the five weeks ended October 18 by about 900 million dollars. Treasury bill holdings declined by 370 milli on dollars and certificate holdings by 530 million. 1nese snles were largely made to meet the currency drain and increased reserve requirements. During the same period the Reserve Banks purchased 680 million dollars in Government securities. Excess reserves continued to fluctuate during this period at a level of close to a billion dollars. Commericalloans at weekly reporting banks increased steadily during September and early October . Loans to brokers and dealers in securities increased somewhat, re£lecting in part large £lotations of new corporate issues during the peripd. Loans to others for purchasing and carrying Government securities, although declining steadily" were in mid-October still about 280 million dollars above their pre-drive level in June. CONDITION OF THE FEDERAL RESERVE BANK (Thousands of dollars) Ootober 15, October 15, 1044 1043 Total cash reserves ....... ... . . ... ... . .. . . . .. . . .. . $542,8.13 $506,062 150 52 Discoun ts for member oonks . .. . . ......... .. . . . . . . . None Other bills discounted . . . . .. . . . ....... ... .. . . . ... . 16 62 1,970 315,142 United States Government scourities ......... •. . .. . . 622,120 315,210 Total earning assets ....... . . ... .. . . .. . . ... . .. . .. . 501,043 491,804 Member bank reserve deposits . . . ... . ... .. ... .. . .. . 373,282 Federal Reserve Notes in aotual circulation ...... .. . . 508,688 I I. Sept 15, 1944 $600,076 175 None 534,567 534,742 587,776 402,862 CONDITION STATISTICS OF 33 MEMBER BANKS IN LEADING CITIES (Thousands of dollars) October IJ, October 13, Sept. 13, 1944 1943 1044 Total loans and investments . .................. .... $1 ,552,088 $1,315,088 SI,556,168 Totallonns.. . ......... . .. . ..... ... . .. ........ . 341,033 320,031 334,884 235,044 217,592 227,896 Commercial, industrial. and n~ riculturallean. .. .. Loans to brokers nnd delliers In sccurit.ies.... .... 2,1 76 6,175 2,245 Other loans for purchasing or carrying securities. . 38,814 24,774 41,535 Real estnte loans . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20,872 10,793 20,713 Leans to banks.... . . . . . . .. .. . . .. . . . . . . . . . . . .. 190 127 214 All other leaas... . ....... . .. .. ............. .. 43,037 61,470 42,281 986,057 1,221,284 Total investments. . . ...... . .... .... . . . .. . .. . . . . 1,211,055 U. S. Treasury bills..... . . . . .... . .. . ... .. . ..... 115,574 112,087 121,483 U. S. Treasury certificates of indebtedness . . . ... . 352,510 240,768 348,923 U. S. Treasury notes... . ........... . . . . .. . .... 217,703 144.077 218,419 U. S. Government bonds. .... .. . . ...... . . . . . .. 450.644 379,173 467,423 Obligntions guamnteed by United States Gov't. . 20,629 56,714 20,629 Other securities . . . .. . . . . .. .. . . . . .. .. . . . . . . . . . 44,005 52,338 44,407 Reserves with Federal Rcserve Bank. . ............ . . 330,040 279,688 329,628 Balances with domestio banks............. . .. .. .... 232,007 247,843 260,760 Demand deposits-adjusted" ... .... ........ . .. ... . 1,154,972 940,626 1,171,356 Ti me d<pOS1ts .......... . ... .. .. .. ....... . .. .. ... . 201,365 150,241 10B,574 United.lltates Government deposits... . .. .. . .... ... . 186.381 255,668 227,597 Interbank deposits .... . . .. .. , . .. . .. ... .. . . ........ 508,250 444,600 490,704 Borrowings from Federal Reserve Bank. . .. . ... .. .. None Nono None "Includes all demand deposits other than interbank and United States Government, less oash items reported as on ham! or in process nf collection. DEBITS TO INDIVIDUAL ACCOUNTS (Thousands of dollars) September Soptomber Pclg.chnngo 1043 over year 1944 20,022 - 10 $ l e,Q82 Abilene . .. ........... .. . 42,318 44,123 - 4 Amarillo ....... . . . . . . .. . 78,ij54 11 2.871 - 30 Austin . . . . .. .. . , ... . . . , . 68, 165 - 3 56,65 ~ Beaumont . . . . ... . ...... . 50,569 50.247 + I Corpus Christi. . ... .. •... 7,61 2 - 16 O,~ 72 Corsicana . . ... ..... •.... 540,630 550,366 - t Dallas ...... .. .... ... .. . 50,029 54,704 - 0 EI Paso .... . . .. .....•... 24B,740 218,767 +13 Fort Worth ... ... . .. . ... . 52,879 - 17 43,980 GalveRto. .... . ...... .. . . 522,B46 510,684 + 1 Houston . . . .. . .. •.. ... .. . 10,920 11 ,200 - 3 Laredo ... . .... . .. . .•. . .. 26,007 - I 26,154 Lubbock .... . . . .... . •.. . 10,221 21,027 - 0 Monroo, La .. . . .... ... . . . 24,664 - 10 22,103 Port Arthur ............ . 7,406 8,107 - 8 Ro.well, N. M. .....•.... - 0 15,380 16,888 San Angelo .. . ... . ...... . 136,139 145,874 - 7 San Antonio . . . .. .. . . . .. . 82,141 84,857 - 3 Shreveport, La......• • .. . 20, 145 10,416 + 4 Texarkann- .. . . .. .... .. . . 20,422 - 13 25,6S0 Tucson. Ariz. . . . .... .. .. . 21,293 + 3 21,060 33,670 - 19 y~~~::: ::: : : : : ::::: : : : : 27,367 28,471 - 12 25,059 Wichita Falls ... . . ... . . . . August 1044 17,608 45,170 74,603 51.588 40,756 5,616 503,415 46,547 205,233 42,916 540,403 11,148 28,600 Pctg.ehango over month +3 22,450 7,548 13,843 137.156 76,956 19,202 26,592 22,743 26,183 25,144 -2 1~,815 +5 +10 +1: +9 +10 +20 +2 -3 -2 +10 +14 - 1 +11 - 1 +7 +5 - 3 -3 +5 -t GROSS DEMA ND AND TIME DEPOSITS OF MEMBER BANKS (Average of daily figures-Thousands of dollars) Combined total Reservo city banke Country bank. Gross Gross Time Time domand demand Time $227,472 $1,166,232 $127,368 $ 888,951 $100, \04 247,011 1,620,800 147,579 1,41 2,000 100,332 20 1,230 1,694,017 180,464 1,581,450 110,775 296.955 1,740,241 184,628 1,612,171 112,327 30a,719 1,900,222 187,085 1,701,240 115,734 307,170 1,025,780 192,204 1,730,104 114,975 315,611 1,015,677 198,204 1,750,468 117,407 SAVI NGS DEPOSITS September 30, 1944 Number of rec~~~~g 8 Beaumont ......... . .. . .. Dallas . . ... . ..... . ... ... EI Paso . . ... . . ...•.....• Fort Worth .... .. . •. ... .• Galveston .. .. . .. ..... ... Houston .. ... . .. . ........ Lubbook . .. ........ . . . .. Port Arthur .... . ...... .. San Antonio . . .. .. .. . .... Shreveport, La ..•.. . •••• Waco .. .. . .. .. . .. . . . •... Wiehitn Falla . .• .. .• ..•.. All other ... ..... ........ 8 2 3 4 10 2 2 5 3 3 3 58 Total •..•••••• 106 Number of 8llvings depositors 11 ,571 102,B93 24,353 35,627 20,037 85,371 822 5,419 33,786 29,032 8,276 6.844 53,094 PerrentnJ:e change in eavings eposits from Amount of savin ~s dcp,,'!t. I 5,827,443 45,003 ,602 14,00\,427 21,423,668 15,234,140 47,573,738 530,064 4,022,457 28,707,603 17,304,393 5,901,751 3,800,073 35,36.1,020 --- - --410,325 245,930.389 Bept.30, 1943 +20.0 +41.4 +43 .0 +86.0 +22.7 +28 .0 +10 .0 +25 .0 +32.1 + 33.9 +28.0 +10.9 +23 .5 +io +'t INDEXES OF DEPARTMENT STORE SALES AND STOCKS September August Septemoer July 1044 1044 1944 1943 Sales \1035. 1030 - 10~" Wit lOut 80aoonal a justment . . . .. . . . 265 220 232 194r 241 With .e.. on,,1 adjustment .. . . . ... •.. 250 266r 211 Stocks (1923-1025 - 100) 122 Without seasonal adjustment .. .. . ... 123 115 119 With seasonal adjustment .. . . . .... •. III 121 126 108 "Sal"" index revised. r-Revised. -6 Total- 24 cities .......... $2,105,489 $2,160,478 - 8 12,010,275 + 5 "Includes the fi gures of two banke in Texarkana, Arkansas, located in the Eighth District. t Change less than one-half of one per cent. Gross demand September 1042 . . .. ...... $2,055,183 September 1943 .......... 3.041,896 May 1944 ...... . . .. 3,275,467 June 1944 . .. . . ... .. 3,30 1,412 July 1044 .......... 3,60 1,462 August 1944.. ...• . . . . 3,655,803 September 1944 . . . . ...... 3,066,1 45 WHOLESALE AND RETAIL TRADE STA'l'ISTICS . Percontage change in: Number Net salcs Stocks ~-of Sept. 1044 from Jan. 1 to Sept. 1044 from Sept. August Sec t. 30, 1044 reporting Sept. August Retail trade: firms 1943 1044 rom 1043 1943 1944 Department stores: Total 11th Dist . . .. 49 - I +14 + 17 + 16 +3 7 Dallas . ....... ... . -I +26 + 22 +18 + 8 Fort Worth ........ 4 - 2 +17 +17 + 14 +1 4 Houston . .. ... . . . .. 7 - I +7 +14 +13 + 7 San Antonio . ...... 5 - 5 +15 - 1 +9 +12 Shreveport ........ 3 +10 +18 + 18 +' j Other cities ........ 23 -8 +15 +13 +14 Retail furniture: Total 11th Dist . . . . 63 - 3 +11 +7 + t Dallas .... .... . . . . - 20 6 + 28 +9 +6 7 Houston .. " ....... +22 +3 - 12 4 - 2 Port Arthur .. .... . 4 San Antonio .... .. . +10 ' +11 +3 +3 3 Wiohita Falls .... . . +16 +20 Indopendent stores:" Oklahoma ........ . 397 +16 +9 +12 Tex..... ... ...... . 990 +11 +12 +11 Wholesale trade: " Automntive supplies 5 + 9 - 6 +24 - 1 Drugs...... . ...... 5 + 4 - 7 Groceries .. . . . . . . . . 25 - t + 9 + 5 + 4 Hard ware...... . .. 14 +22 - I + 7 +22 - 4 SurR cquipment. ical 4 +16 - 6 + 26 + 4 + 7 "Com piled by United Stntes Bureau of CCDSUS (wholesale trade figures preliminary). tStoeke at end of month. • tCbaDge 1 than one-half of on. per cent. 083 AUgU t 31, R 1944 + 2.8 + 3.4 :): 3.5 3.1 l 2 .3 2.8 6.3 + 2.8 + 3.2 + 2.8 + 1.0 + 2.2 + 2.1 --- + 2.8 +31,1 CRUDE OIL PRODUCTION-(Barrele) September 1944 IDcrense ordeerease in daily avcra~e productioD from Total Daily avg. production production Sept. 1043 August 1044 North Texas . . . . .... .. ... . .. . 7,395,500 246,517 038 + 2,277 West Texas . ....... . .. . . .. . . . 15,083,300 502,776 +173,860 +17,826 East Texns ......... .. .... •.. 15,619,700 520,057 + 10,467 + 1,307 South Texas . .. . . .... .. . . . . . . 10,212,800 340,410 + 78,663 +18,760 542,527 Coastal Texas . .. .... .... " .. . 16,275,800 + 58,611 + 7,327 Tohll Texas . .. ..... . New Mexico .. ... . . . ..... ... . North Loui. iann ... .... .. .. .. . 64,586,600 3,182,900 2,218,000 2,152,887 106,007 73,OR3 ---+323,887 - 1,676 7,069 Totnl District. .. . . . .. 69,088,400 2,332,947 +314,242 SOURCE: Estimated from American Petroleum Institute weekly reports, +44,287 901 + 239 +43,625 VALUE OF CONSTRUCTION CONTRACTS AWARDED (Thousands of dollars) September September August January I to September 30 1044 1043 1944 1944 1943 Eleventh District- total . . S 17,265 S 10,346 S 16,456 $ 123,884 S 287,608 Residential. ..... . .. .. . 404 3,364 515 20,028 71,603 All other ... . . . ... . . .. . 1a,861 6,082 15,941 103,856 215,045 United States"- total. .. . . 175,739 175,115 169,341 1,405,840 3,220,120 Residential. .. . .. ..... . 24,470 54.080 28,273 277.448 780,661 All other . .. .. .. . . . .. . . 151,269 121,035 146,OB8 1,218,392 2,448,450 "37 .tnt es east of the Rocky Mountain. SOURCE: F. W. Dodge Corporation. BUILDING PERMITS Septemher 1044 Abilcne ...... . . .. Amarillo .. . . . .. .. Austill ........... Beaumont .... . . . . £~.ir.,~~ ?h~~s.t~ : : : : EI PIL~O . . . .. ... . . Fort Worth ..... . . Gal veston . ...... . Houston. "" . .. .. I,ubbock .. ....... Port Arthur . .. . . . San Antonio . . .... Shreveport, La . .. Waco ...... .. ... . Wichitn Falls . . ... No. Valuation 12 $ 12,325 71 96,504 98 97.308 127 43.281 114 137,109 520 251,009 43 69,518 230 293,616 71 56,702 219 676,730 117,132 110 10,762 60 740 363,162 176 277,783 56 43,333 28 20,007 - - - - -- Percentage Pereentage ohango valuation from Jun. I toSept.30, 1044 cban~e valuatloa Scpt.1948 Au ~. 1044 No. Valnation from 1943 213 $ 327,590 + 01 +244 - 79 1,003,043 + 03 - 19 666 +115 523,071 + 91 + 51 007 +130 - 71 1,187 668,740 - 69 + 73 1,131 1,405,782 - 48 - 32 7 5,607 5,004,610 +113 - 30 - 22 710 1,151,095 +214 - 61 +150 2,005 2,500,928 - 52 - 61 t 868,365 + 13 - 20 +413 080 2 2,216 7,060,574 + 4 + t 865,59a +368 1,167 +329 + 46 546 247,294 + 5 - 27 :): 2~ 3,166,187 + 47 7,655 - 25 1,371 1,044,489 + 260 +732 +174 1,204,018 + 80 683 + 16 + 77 210,057 + 41 270 - 66 + 10 TotaL . .. . . 2,608 $2,576,190 tCbonge less than one-half of aDO por - - c~nt. I - 0 27,018 $28,434,336 + 10
