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MONTHLY BUSINESS REVIEW
o
f the FEDERA[ RESERVE BANK
o f
Dallas
~=========================================~======~~======
Volume 28, No.8
Dallas, Texas, October 1, 1943
This copy is r elessed for pubJication in afternoon pllpers-
0
b 1
cto er
~===~================================================
DISTRICT SUMMARY
Consumer buying at retail establishments continued in large
volume during August and the first half of September. Depart?lent store sales in August this year were 31 per cent higher than
' In the corresponding month last year. During the first half of
September, sales of a smaller number of weekly reporting stores
showed a gain of 37 per cent over those of a year earlier. Daily
average production of crude petroleum which had shown an upWard trend since last spring rose sharply in August, and further
substantial increases are indicated for September and October.
Drilling operations have become more active. Although well
c~mpletions are more numerous than a year ago, they are conSiderably less than in the corresponding period of 1941. The
value of construction contracts awarded in this district increased moderately from July to August but was only about
one-sixth of total awards in August last year. The drought
d~d high temperatures which prevailed in most sections of the
Istrict during August reduced yields of growing crops and
l,aUsed substantial deterioration in the condition of ranges and
d;estock. While rains early in September partially relieved the
l' ought over a considerable portion of the district, rainfall was
Ight in some areas where the drought was most severe. Cotton
~~s opened rapidly and farmers are experiencing considerable
Ifliculty in obtaining sufficient labor to harvest the crop.
BUSINESS
.
.Total sales at reporting department stores in the Eleventh
District continued in heavy volume during August and the first
~wo weeks in September. Sales, which were seasonally lower durIng June and July, increased 10 per cent during August and
":'ere 31 per cent larger than in August, 1942. During the first
eight months of the current year total sales averaged 41 per cent
~bove the corresponding part of 1942. The percentage increase
!n sales over last year continued to be larger in this district than
In any other Federal'Reserve district. Weekly reports from a
shaller number of firms indicate that sales in this district during
t e first week in September were 25 per cent larger than in the
same week of last year, and 49 per cent larger during the second
week of the month.
A. Cash sales constituted about one-half of total sales during
Ugust and, continuing the trend of other recent months, in~rease? at a, faster rate than credit sales. Credit sales during the
rst eight months of the year were only 25 per cent larger than
:hose last year, whereas total sales showed an average increase of
1 per cent. Most of the increase in credit sales during August
Consisted of regular monthly account sales, while the dollar
"lolume of instalment sales was about the same as in August,
942.
Since October, 1942 the ratio of collections on regular achOunts outstanding at the beginning of each month has ranged
etween 60 and 65 per cent. During August the ratio was 59 per
Cent. The ratio of collections on instalment accounts during the
lirst eight months of the year has averaged 25 per cent or more
each month. During August collections on instalment accounts
at.nOunted to 29 pi r cent of the total outstanding at the begine
ning of the month.
Department store sales in the Eleventh District have been in
unusually heavy volume since last February and as a result, in"entories at the end of each month during the first half of the
Year Were smaller than on corresponding dates in 1942. During
july and August, however, inventories at reporting department
Stores showed a tendency to increase and at the end of August
lIere 12 per cent above those at the end of August, 1942.
There were no commercial failures in the Eleventh Federal
Reserve District during August. This is the second consecutive
month in which no failures have been reported. During the fust
eight months of the year there were only 11 commercial failures
in the district and there has been only one since April. The
liabilities of defaulting firms, as reported by Dun and Bradstreet,
Incorporated, amounted to $2 63,000 during the first eight
months of this year, as compared with liabilities of $1,335,000
during the comparable period of 1942.
AGRICULTURE
The acreage in cultivation in the United States this year is
the largest in ten years. Weather conditions have been somewhat
less favorable in many areas than last year, however, and on,
September 1, it was estimated that total crop production in the
nation would be 7 per cent smaller than in 1942, although 4 per
cent greater than in any previous season. Total food production
this year is expected to be from 4 per cent to 5 per cent greater
than the record output in 1942 and approximately 30 per cent
above the 1935 -19 39 average, reflecting the substantial increase
in livestock production.
Temperatures were ahnormally high and rainfall was scattered and very light during August in all sections of the Eleventh District except Arizona, New Mexico and southeast Texas.
The extended dry period favored harvesting operations in Texas,
but caused deterioration of crops and ranges in the State, de- '
layed preparation of land for fall crops and retarded wheat seeding operations. There were widespread rains in Texas during
the first two weeks of September which partially relieved the
drought in central, southern and eastern counties, but northwest Texas and the Trans-Pecos counties, where the drought
was more severe, received little rain. The sweet potato crop, late
planted peanuts and pastures benefited from the early September rains. Summer crops were too far advanced, however, to be
helped materially.
Hot, dry weather in Texas reduced the indicated yield of cotton from 201 pounds per acre on August 1 to 176 pounds per
acre on September 1. It is estimated that 7,888,000 acres of
cotton will be harvested in the State this year, or 23 per cent
less than the average during the 1932-1941 period. A 1943
cotton crop of 2,900,000 bales is indicated in the State, as
compared with 3,038,000 bales produced last year and the 19321941 average of 3,419,000 bales. The cotton crop in New Mexico and Louisiana is expected to be somewhat larger this year
than in 1942 or the 1932-1941 average, but the indicated production in Oklahoma and Arizona is substantially smaller. Picking and ginning of cotton progressed rapidly in Texas in August
and was not delayed appreciably by the rains early in September.
Despite local shortages of labor on farms and at gins, compresses
and warehouses, generally good progress has been made with the
picking, ginning and movement of cotton. In Texas, 1,126,000
bales were ginned prior to September16 as compared with 599,000 bales ginned prior to the same date last year. The cotton
ginned in the State prior to September 16 this year was of somewhat higher grade but shorter staple, on the average, than the
cotton ginned prior to that date in 1942.
The late corn crop deteriorated in Texas during August, but
the per acre yield of corn is expected to exceed the 1942 yield
and is only fractionally smaller than the 10-year (1932-1941)
average. A Texas corn crop of 83,979,000 bushels was indicated
on September 1, as compared with 78,561,000 bushels produced
last year and the 1932-1941 average of 77,609,000 bushels. The
August drought severely damaged the late sorghum crop in the
This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org)
2
MONTHLY BUSINESS REVIEW
northwestern part of the State, but the indicated 1943 grain
sorghum crop of 59,475,000 bushels is only slightly smaller than
the 1942 production and about 28,000 ,000 bushels larger than
the 1932-1941 average. The indicated 1943 peanut crop in
Texas of 423,200,000 pounds is somewhat smaller than the crop
of 1942 in spite of a marked increase in the acreage in peanuts,
but approximately four times as great as the 1932-1941 average.
Indicated 1943 production of wheat and hay in the State is considerably smaller than in 1942, although somewhat larger than
the 1932-1941 average. The Irish potato and sweet potato crops
are expected to be considerably larger, however, than in 1942
and the 1943 Texas rice crop is expected to total 20,592,000
bushels, as compared with 15,498,000 hushels last year and the
10-year average of 11,324,000 bushels.
Ranges deteriorated during August in all sections of the Eleventh District except Arizona and southeast Texas, where range
feed and pasturage improved considerably as a result of heavy
rains. The drought became particularly serious during the month
in southwest, west and central and extreme south T exas, where
shortages of range feed and stock water necessitated hauling of
water and feeding of livestock. Rains during the first t wo weeks
of September benefited ranges in the central, southern and eastern counties of Texas, but little or no rain was received in a
large part of west Texas where ranges are dry and stock water
is scarce. The condition of cattle in this district is good except
in some sections of west and southwest Texas where considerable shrinkage has occurred. Marketing of Texas cattle was in
somewhat larger volume during August than during preceding
months but below the level of August, 1942. Sheep in the
Eleventh District are in fair to good condition. Culling of sheep
herds continued in Texas during August with heavy movement
of old ewes to market. Indicated 1943 wool production in Texas
of 77,748,000 pounds is somewhat larger than in 1942 or the
1932-1941 average. Indicated wool production in New Mexico,
Arizona and the United States as a whole is somewhat smaller
than last year.
Farm prices of meat animals declined moderately in Texas
between July 15 and August 15 this year. Farm prices of wheat,
oats, barley and feed crops increased slightly and the prices of
corn, rice, potatoes and chickens declined. The farm prices of
all of the major farm products except rice, potatoes and hogs
were substantially higher in the State on August 15 than on the
same date last year. Cash farm income from farm marketings
during the first six months of 1943 amounted to $462,000,000
in Texas and to $779,000,000 in the five states covered in whole
or in part by the Eleventh District. Income from livestock and
livestock products accounted for 65 per cent of the total in
Texas and for 61 per cent in the five states. Cash farm income
in Texas during the first six months of this year was almost
three times as large as in the comparahle period of 1940 and 40
per cent greater than during the same period last year.
FINANCE
The reserve balances of all member banks in the Eleventh
Federal Reserve District, which stood at $467,000,000 on August 1, rose to $494,000,000 on the 15th of the month, and then
followed a generally downward trend during the following two
w.eeks. Average reserve balances during August of $482,000,000
were not significantly different from the average for the first
seven months of the current year. During the early part of
September, however, reserve balances increased sharply, reaching
a new all-time peak of $541,000,000 on September 11. During
the first half of the month reserve balances averaged $511,000,000, a new high record, and were $137,000,000 above the comparable period of 1942.
During the last half of August, the demand deposits at member banks in the district, part icularly those at reserve city banks,
increased rapidly. The increase reflected principally the conversion of Treasury deposits in war loan accounts into customer
deposits. During that period required reserves of reserve city
CONDITION OF THE FEDERAL RESERVE BANK
(ThousandRof dollara)
Sept. 15,
Sept. 15.
1948
1042
T otal cash reserves .......................• . . . .... $651,853
$450,550
Discoun t. for member banks .. .. . ... .... .. . . ...... .
127
1,173
Industrial advances ... . .... . ........... . .•.. . .... .
IS
138
United States Government secu rities .............. . .
270,310
148,895
All other investments ...... ... .. .. ........ .. ....•.
None
73
Tota l caming assets .......... ........ .... ...... ..
270,455
150,279
Member bank reserve deposits ... .... ..... ... ..... .
507,563
aS4, I50
Federa l R eserve notes in aotua l circulation . .. ... ... .
365,277
188,060
August 16,
1943
1658,586
50
18
231,620
None
281,688
403,008
340,898
CONDITION STAT ISTICS OF 33 MEMBER BANKS I N I.F.ADING CITIES
(Thousands of dollars)
Sept. 8,
Sept. 0,
AUGust 11,
1948
1942
1048
T otal loans uud investments .. . ..... . ..... ... .. .. .. 51,220,731
$70 1,419 $1,230,738
Total loans. ..................... . ..............
281,746
300,836
274,325
Commercial, industria l und n~rielliturn i ionns......
203 117
219,204
199,058
Loaus to brokers and dealers In secu rities..........
2'150
2,207
1,647
Other loan8 for purchasing or carrying securities....
13:273
11,631
13,626
Real estate loans. .. . . ................ . ........ .
19,772
20,576
19,341
Loans to banks.. .. .. .. . .. . .... .. . .. .. .. .. .. .. .
104
276
132
All other loans. . . .. .. . .. . .. . .. .. .. .. . . .. .... . . .
43,330
46,942
10,521
Total investments...... . . .. . . .. . .. . . . .. . . .. .. . ..
938,985
490,583
956,4 13
U. S. Treasury bills...... .. ... .. . .. ... . .. .. .... .
93,508
74,179
lt 4,47G
U. S. Treasury certificates of indebtedness.. .. . . . . .
235,979
69,568
230,695
U. S. Treasury notes .. .. . .. . .. . .. . . . .. . . . . . . .. . .
140,780
44,797
151,285
U. S. Government bonds...................... ..
353,97 1
204,22 1
351,90~
Obligations guaranteed by United States Gov't.....
56,737
39,002
54,406
52,010
58,2 16
1i3,647
Other secu rities... . ....... . . ...... . ... ... ......
Reser ves with Federal R eserve Bank .. .. .... '" .. .
313,895
244,739
295,953
Balances with domestie banles. .• .. ... ..... . .. . .. . .
230,50 1
259,609
238,782
pemand deposits-adjusted *. . . . . .. . .. . .. . . .. ... .. 1,049,254
743, 137
1,011,639
r ime deposits ... ... ... .... .. . . . . .. . . . . .......... .
150,505
131,734
147, 159
United Btates G~vernment deposits... . . .. . .. . . . . .. .
74,133
21,340
130,080
Interbank deposits................... . ............
438,437
348,915
42.,128
Borrowings from Federal Re.erve Bank.. . ...
...
None
None
None
~In oludes all demand deposit~ other thon interbank and United States Governmenl, Ie"
cash Itelllll reported as on hund or In process of collection.
DEBITS TO I NDIVIDUAL ACCOUNTS
(Thou8a nds of dollars)
Pelg.ehonge
August
August
1943
1942
over year
Abilene. . . . . .. . .. .. . .. .. I 15,085 $ 13,841
-I- 9
Amarillo.. . ... .. .. ......
36,781
42,616
- 14
Austin..................
61,606
61,437
-I- t
Beaumont............ .. .
51,983
37,458
+39
43,190
30,013
+ 11
Corpus Christi. ... . .. . .. .
Corsicana...............
5,713
4,134
+38
Dallas. . . . . .. . . . . . . . . .. .
484,548
397,406
+ 9
E l Paso. . . . . . . . ..•. . . . . .
47,466
49,493
- 4
Fort Worth ... . . . . .• . . . . .
177,706
131,565
+35
40,470
34,004
+19
Ga lveston .. .. .. ..... ....
Houston...... . .. .. .. ....
452,343
372,215
+22
Lnredo.. . . . . . . . . . . . . . .. .
10,285
8,008
+28
Lubbook..... ... ........
10,925
16,241
+23
Monroe, La... . ... . ......
15,051
14,345
+ 5
Port Arthu r . . . .. .. .. ....
18,715
15,822
+ 18
6,949
5,498
+26
Roswell, N. M...... .....
San Angelo . . . . . . . . . . . . . .
12,635
13,717
- 8
San Antonio.............
126,075
111,560
+ 13
Shreveport, La . . . . . . . . . • .
64,467
62,657
+ 3
T exarknna* .. .. .. .. . .. ...
15,614
15,556
+ t
Tucson, Ariz... . . . .• . . .. .
24,068
21,183
+ 14
i1'~~~:::::::::::::::::::
Wichita Falls. ....... . ...
g:~~~
21,570
~~:b~~
10,554
~3~
+10
.Jul y
1943
15,240
43,00'1
SO,ll8
53,761
41,915
6,135
446,883
53,298
237.994
39010
456:831
10,951
20,553
14,488
18,959
7,315
15,484
128,401
64,554
15,058
31,239
Potg.ohaog e
over month
- I
~:m
23,866
- 14
+
-
23
3
3
7
a
- Il
-25
+ 4
- I
- 6
- 3
+ 4
- 1
_ 6
- 18
- 2
_ t
+ •
-~3
+~
-- 10
Total-24 eities . .. . .. . . .. 51,743,473 $1,525,120
+14
$1,866,957
- 7
*Inrludes th e figures of two ba nk. in Texarkana, Arkansas, located in tho Eighth Dinricl.
tchange less tban one-half of 1 pcr cent.
GROSS DEMAND AND TIME DEPOSITS OF MEMBER BANKS
(Average of daily fig ures-Thousands of dollars)
Reserve oity banks
Country ba~
Oombined total
Gross
demand
August, 1041. ........... . $1,567,402
AUguRt, 1942 ............. 1,085,128
April, 1048 . ... . ... . .. .. 2,718,086
May, 1943 ..... .... ... . 2,846,872
June, 1943 .. ........... 2,876,672
July,
1943 ...... .... ... 2,874,870
August, 1943 ............. 2,925,648
Gross
Gross
Time
demand
demand
Time
S238,939 $ 921,803 $133,758 $ 645,539
220,916
847,441
1,137,087 127,231
234,791 1,482,955 138,03 1 1,235,132
235,518 1,580,606 139,352 1,266,266
238,040 1,584,550 141,240
1,292,122
24 1,780 1,562,343 143,301
1,312,528
245,390 1,585,376 145,304 1,340,271
SAVI NGS DEPOSITS
August 31, 1043
Bonumont .. . . ...........
Dallllll .... .. .. ... ...... .
E I Paso .......... . ......
Fort Worth ... . ..........
Galveston ....... . .......
Houston ...... . .. . ... ....
Lubbock . . .. . ...........
Port Arthur . ... .. .......
San An tonio ... .. ....... .
Shreveport, Ln . . . .... . ...
W.co ...................
Wi chita Falls .... . .......
All nther ................
Total. ..........
Number of
recorting
anks
3
8
2
3
4
10
2
2
5
3
3
3
Amount of
59
depositors
10,976
94,828
21,060
34,093
19,074
78,330
930
5,127
28,030
26,506
7,500
6,348
50,447
depOSits
$ 4,780,905
32,551,848
9,8ll,308
15,683,229
12,379,905
37,511,515
468,255
3,297,848
21,568,798
13,073,847
4,803,754
3,014.101
29,060,642
August 31,
1942
+14,4
+26.3
+37.5
+24.7
+15.1
+15.9
+23 . 9
+ 2.8
+20 . •
+ 7.8
+16 . 5
+ 7.8
+ 9.2
107
383,853
Sl88,614,955
+17.5
savin~s
99,
96'i~~
06'800
06'478
98'68 6
100,
Peroentage change in
savings deposi~
Number of
savings
TiJllo
S105'6 ~
1
JulY 31,
1943
2. 1
3. 3
+
+
+ 3.2
+ 3. 3
+ 2.1
+ 2.3
+ ).4
+ lJ
+ 1. 7
2. 3
+ 1. 3
+
+ 2.1
6
---+ 1.
+ 2.3
MONTHLY BUSINESS REVIEW
banks rose $10,000,000 and there was an increase of $5,000,000
at COuntry banks. Although there was a small increase in reserve
balances, it was not sufficient to offset the increase in required
reserves with the result that average excess reserves of all member banks in the district declined from $117,750,000 in the
first half of August to $102, 500,000 during the latter half of
the month. Excess reserves of all member banks during the
latter part of August were $55,000,000 below the all-time peak
of excess reserves reached in May this year and were at the lowest
level in more than a year.
. Total loans of 33 weekly reporting member banks in the
Eleventh Federal Reserve District rose $7,400,000 to a total of
$281,700,000 during the four weeks ended September 8. Commercial, industrial and agricultural loans rose $4,000,000 and
"all other" loans increased $2 ,800,000. In addition, there were
small increases in loans to brokers and dealers in securities and
in real estate loans, offset ill part hy relatively small declines in
"Other loans" for security t rading and in loans to banks.
During recent months there was a significant change in the
hOldings of Treasury bills by weekly reporting member banks.
For more than a year the Federal Reserve System has followed
~ policy of encouraging member banks to keep their funds fully
Invested. In this way it was felt that banks would be able to
o.ffset in part the decline in earnings from loans and at the same
time would be able to contribute their fair share to the financing
of the war effort. It was recognized that if banks kept their
funds fully invested, occasions would arise when they would
need additional reserves. In an effort to assure banks that additional reserves would be available to them as required, the Federal Reserve System established a fixed buying rate of % of 1
per cent per annum on Treasury bills. Banks which sell Treasury
bills to the Federal Reserve banks at a fixed rate also have the
Option of repurchasing a similar amount of Treasury bills from
the Federal Reserve banks at the same rate at any time prior to
maturity. Under this arrangement Treasury bills have come to
be the equivalent of excess reserves. During the past year the
excess reserves of member banks in all parts of the country have
been reduced, largely because banks have purchased increasing
amounts of new Treasury securities. During recent months
bany banks in this district and in other parts of the nation have
egun to utilize their holdings of Treasury bills as a means of
adjusting their reserve positions.
Between the middle of May and September 8, holdings of
~reasury bills by the 33 weekly reporting member banks in this
district declined $34,000,000. Principally as a result of the reduction in holdings of Treasury bills, total investments of the
weekly reporting member banks in the district declined $17,400,000 during the four weeks ended September 8. Holdings of
other types of securities showed only small net changes during
~lat period. Holdings of Treasury certificates of indebtedness,
reasury bonds and guaranteed securities increased somewhat,
:"'?ile holdings of Treasury notes and nongovernmental securIties declined $4,500,000 and $1,600,000, respectively.
Gross deposits of weekly reporting member banks amounted
to $1,712,000,000 on September 8, a decline of $700,000 since
.l\ugust 11. During the four weeks ended September 8, United
States Government deposits declined $56,000,000. On the other
h~nd, adjusted demand deposits increased $38,000,000 to a new
high level of $1,049,000,000. Interbank deposits also rose $14,000,000 and there was a small increase in time deposits.
INDUSTRY
Military needs for petrol eum and its products are increasing
rapidly and placing unprecedented demands upon the productive
wPacity of the oil field s of the nation. The Pet roleum Industry
ar Council estimates th at the demand for petroleum in t he
lJnited States may totl l 4,915,000 barrels daily during the last
911 :1rter of this year and may rise to 5,219,000 barrels daily durI~g the b st quarter of 1944. Daily average production of crude
Oil has already increased from the 1942-1943 low of 3,501,000
3
barrels in April, 1942, to the record high of 4,216,000 barrels
in August this year. Further substantial increases in production
must come from the Eleventh District since most fields in other
areas are apparently already producing virtually at capacity.
Cr ude oil production in this district, which averaged 1,551,000 barrels daily during the first four months of this year,
increased markedly after the first section of the big-inch pipe
line was completed in May, attained an all-time peak of 1,904,000 barrels daily in August, and prob;vbly exceeded 2,000,000
barrels daily during September. Daily average production in the
district may achieve a new peak in October as a result of moderate increases in the production allowables of southwest and
coastal Texas fields. On the basis of estimates of the capacity of
T exas fields to produce made by the Texas Railroad Commission,
it would appear possible to increase production in this district
to 2,375,000 barrels daily without resorting to wasteful production practices. If that quantity were produced in this district
and production in other areas were maintained at the August
level, nearly 4,700,000 barrels of crude oil per day would be
produced in the United States. Most of the surplus producing
capacity of this district as well as of the entire country is
located in west Texas and New Mexico and its utilization will
depend upon expansion of transportation facilities. The War
Production Board has approved construction of two pipe lines
which, when completed, will transport approximately 105,000
barrels of crude oil daily from West Texas to refineries in Texas,
Oklahoma and the Middle West. These pipe lines are not expected to reach capacity operations, however, until early next
year. Furthermore, many fields outside this district may be unable to maintain production at August levels. On the basis of
available information it appears~ ther~fore, that essential petroleum needs may soon be greater than the nation's existing
capacity to produce. The Petroleum Industry War Council expects demand to exceed production by 13 3 ,000 barrels daily
during the last quarter of this year and by 512,000 barrels daily
during the last quarter of 1944.
Withdrawals from present stocks of crude petroleum could
not offset deficits of that magnitude for an extended period.
WHOLESALE AND RETAIL TRADE STATISTICS
===::N;;t;Pereontago ohnn ~o in:- - - - _
Number :
Net sales
StookR t-~
of
August, 1043 from
Jan. I to
August, 1043 from
reporting AuguRt,
July,
Aug. 31, 1048 Au ~ust,
July,
Rotail trade:
firms
1042
1043
from 1042
1042
1043
Department stores:
Total 11th Dist ... .
47
+31
+10
+41
+12
+ 7
Dnllna ........... .
7
+38
+15
+48
+17
+11
Fort Worth .. . .. . . .
4
+35
+10
+46
- 9
+ 6
Houston .... .... . ..
7
+31
+11
+35
- 14
+3
San Antonio . .... • .
5
+21
+ 4
+40
+30
+ 2
Shreveport .. .... . .
3
+20
+ 5
+16
Other oities . . ..... .
21
+29
+ 7
+43
+17
Ret. it furniture:
- 21
'fatal 11th Dist. . . .
61
- 1
+20
+5
- 30
Dallns .. " ........
8
+1 8
+5
+ 3
Fort Worth.. ......
3
- 1
+46
- t
- 5
- 42
Houston .......... .
8
+12
+38
-8
San Antonio . . . . . . .
4
- 2
- 18
+11
+6
Indo{JCudon t stores:'
Arizona . . . . . . .... .
+'9
~~I~I~~~~~: :::::: 88
8
+23
+35
+ 23
+31
Texas .. "" "" .. . 959
Wholesale trade :'
Mnrhioerv, eqp't &:
4
- 5
oUPl'lies . . ..... . .
+15
Dru~s (inr.!.liquors).
10
+18
+5
4
- 20
Eleotriral sup;llics ..
+42
:':'i:i
20
- 9
Grorories ......... .
+0
- 1
+20
13
Hardwnre ... . .. . . .
- 8
- 13
- 20
+3
- 5
Su rgical, hospit. 1 &:
medical eqp·t .. ..
+ 23
- 6
+ 3
+1
TobROilO &: products.
+ 24
+ 6
+ 14
· Compilp.d by United Stllte. Burellu of Cells.,s. tChang. less thon one-half of ono per oent.
t Storks ot cnd of mouth.
INDEXES OF DEPARTMENT STORE SALES AND STOCKS
(I023-1 925 overoge= I00)
August
August
J uly
SaleR (daily ovcrago) :
1943
1042
1943
188
127
163
Without sl"",on .d ju"tmp ut . . .. .•.. . .
With silasonal adjustment . " ... . ... .
244
165
233
Stoc.s (end of month):
W, t hout seasnnal ndjus tmcnt. . . . . .. .
117
107r
111
With Bensonal aujustment. .... . . . .. .
115
105r
121
r- Revised.
Juno
1043
183
206
91
97
MONTHLY BUSINESS REVIEW
4
Crude petroleum stocks on the East Coast and in other areas
outside this district have been partially replenished in recent
months but are still below normalleveIs. In this district, stocks
have declined slightly since attaining the 1942-1 943 high on
May 29 this year. The improved transportation situation in the
Atlantic and in the Mediterranean might make increased ocean
tanker shipment of petroleum from Mexico, South America and
the Near East feasible. Such shipments could ease the domestic
petroleum shortage by meeting a part of the military demand,
but it seems unsafe to rely upon that eventuality. Intensified
drilling in proven producing areas and increased exploratory
drilling may be required if the essential demands for petroleum
are to be met without resorting to production practices which
would reduce the ultimate recovery from reserves. Drilling activity has increased somewhat in this district and in other areas
since March this year, but 47 per cent fewer wells were completed in the United States from June through August than
during the comparable period in 1941. Wildcatting has been
intensified, but the additions to proven reserves resulting from
these operations have been insufficient to cover withdrawals
from reserves brought about by current production.
Cottonseed receipts at Texas cottonseed mills during August
this year, which totaled 161,000 tons, were 47 per cent greater
than in the same month last year. Production activities at the
mills increased seasonally during the month but were not appreciably above the levels of the same period in 1942. August
shipments of linters from Texas cottonseed mills were subCOTTONSEED AND COTTONSEED PRODUCTS
- - - - Texas
United Stntes--~
August 1 to August 31
August 1 to August 31
This senson
Last senson
This Re8son
L8st season
Cottonseed received at milt.
(ton.) ............. . . . .... .
160.585
109,488
391.421
168.588
Cottonseed crushed (tons) .... .
44,050
43.352
132.574
97,543
Cottonseed on hand Aug. 31
(tons) ... . . . . . . . . . .. . . . . . . .
161,103
101,405
348,664
152,973
Production of products:
Crude oil (thousand lbe.) ... .
12,732
12,894
40,010
29,883
20,573
19,412
Cake and meal (tons) ...... .
58,078
42,332
10,226
10,342
Hulls (tons) . . ............ .
31,638
24,31e
12,818
12,207
Linters (running bales) ... .. .
30,687
28,256
Stocks on hand August 31:
5,548
Crude oil (thous.nd lbe.) . . . .
5,014
17,610
13,875
Cake and meal (tons). . . . . . .
9,334
29,241
36.887
133,284
Hulls (tons). . . ... .. . .. . .. .
5,747
10,670
10,170
26,308
23,023
Linters (running bales) . . . . . .
38,008
111,807
51,892
SOURCE: United States Bureau of Census.
DOMESTIC CONSUMPTION AND STOCKS OF COTTON-(Bales)
August
August
July
1943
1942
1043
Consumption at:
19,691
20,207
21,3 19
Texas mills ..... . .............. . .. . ..... . . . ... .
United States mills . ..... .. . ............. .. .... .
842,260
924,915
839,705
U. S. Stoeks-end of month:
1,925,118
2,JJ7,343
In consuming establishments ......... ... ......... 1,928,808
7,539,501
PII blic stor.ge and compresses . ................ . . 8,206,906
7,704,181
Abilene . . ........
Amarillo . . ..... . .
Austin ... . ... . ...
Beaumoat ... . ....
C01l'.UlI Christi . ...
Dal s . ... . ......
El Paso ..........
Fort Worth .. . ....
Galveston ... . ....
Houston .. . . ......
Lubbock .... . ....
Port Arthur . .....
San Antonio ......
Shreveport, La ....
Waco . .. ... .. .. . .
Wichita Falls .....
BIDLDlNG PEUMITS
Percentage cbange
Percentage
valuntion from
Jan.1 toAlIg.31, 1943 "han~e
August, 1943
valuation
Valuatien from 1942
No. Valuation Aug.,1942 July,1943 No.
184 $ 167,81 7 -86
22 S 42,968
+267
+004
476,473 -20
11,700
- 69
856
43
- 80
209,003 -86
28,107
677
134
- 53
+ 48
2,143,969 - 8
24, 140
- 34
851
- 61
77
852
2,715,900 -70
114
83,766
- 94
- 65
2,450,076 -65
3,684
755,350
+ 21
640
+ 266
301
338,496 -R2
- 38
49
34,471
+147
- 15
2,487
4,618,115 -52
412
677.600
+ 40
64,797
- 78
575
605,249 - 70
105
+107
1,327
6,004,880 - 44
826,275
206
+ 127
+354
35,717
587
157,782 -92
103
+ 14
+137
210,227 -32
8,503
- 48
357
53
+ 17
256,593
5,152
1,868,417 -40
707
- 12
- 20
69,045
641
256,660 -86
100
+ 47
+156
41,978
- 66
409
600,152 - 36
- 58
59
36,315
161
136,608 - 71
- 24
20
+111
------
Total ... . . . 2,P34 $2,907,415
+ 41
-
22
18,691 S23,140,733
VALUE OF CONSTRUCTION CONTUACTS AWARDED
(Thousands of dollars)
August
August
July
- -Jan. 1 to
1943
1042
1948
1043
Eleventh Distrielr-total... '17,537
Sl06.042
$ 14,4 12r $ 276.985
Residential. . . . . . . . . . . .
5,065
12,114
3,299r
68,513
All otber . . .... . .. . ... .
12,472
03,928
11,113r
208,472
United States"-totnl. . . . .
413,701
721,028
183.661
2,148.724
Residential. . . . . . . . . . . .
67,493
100,651
71,836
610,455
1,829,260
AU oth. r . . . . . . . . . . . . . .
346,298
620,477
111,825
'S7 states east of tbe Rocky Mountains.
r Revised
SOURCE: F. W. Dodge Corporation.
- 57
Aug. 311042
S 528,913
92,510
436,403
5,388,549
1,213,513
4,176,036
stantially larger this year than in 1942, but shipments of cake
and meal and hulls were considerably smaller and shipments of
cottonseed oil were fractionally larger.
The potential shortage of labor is becoming an increasingly
important factor in many war centers in T exas. Employment
in war industries in t he State may not be as large at its peak as
was anticipated earlier this year, but the rate of increase in
employment is to be accelerated, particularly in the aircraft
industry, and peak employment may be reached considerably
sooner than was previously expected. Production schedules in
the industries in the State call for the employment of approximately 65 ,000 additional workers by January, 1944 of whom
40,000 will be required by the aircraft and shipbuilding industries. The overall supply of labor in T exas is apparently adequate
to meet this demand, but the employment of housewives on a
large scale and the movement of workers into at least twentytwo war cent ers in the State will be necessary. Housing shortages
in war centers and lack of child care facilities appear to be the
principal deterrents to meeting hiring schedules of the war
industries.
CRUDE ilILlIPRODUCTION-(Barrels)
AugURt, 1943
Increase or deere... in dailY
• vcrng. produetion from _
Totol
D,i1yavg.
prod uction
produotion
August, 1942
July, 1943
7,347,000
237.000
North Texas .. . .. . ..... .. . .. .
+ 9,248
+ 7,316
8,137,600
262,503
West Texas ...... . ......... . .
+ 38,488
+ 17,822
501,429
East Texas .... .. . .. . . . ..... . 15.544,300
+ 4,665
+ 46.676
7,444,000
240,120
South Texas .... . ....... .. .. .
+ 53,987
11,320
474,829
Texas Coostal. ...... . . . ... . . . 14,719,700
+179,331
+ 69,720
+
Total Texas ....•. .
North Louisiana . . .... . ...... .
New Mexico ...... . ....... . . .
53, 192,600
2,575,150
3,241 ,850
1,71 5,800
R3.069
104,576
+325,798
- 14,076
+ 20.568
Total Distriot . . . .. . 59,009.600
1,903,535
+332,201
SOURCE: Estimated from Amerioan Potroleum Institute weekly reports.
+106,793
1.923
+ 2,807
-
+107,671
LIVESTOCK UECElPTS-(Number)
~--Fort Worth---~-- SAn
August
1043
Cattle. ............ . . . .. . 07,105
Calves...... ... . . .. ..... 40,108
Hogs...... .. .. ..... ..... 77,545
Sheep ....... . •... .. . . . .. 406,530
August
1942
106,010
45,872
44,029
161,840
July
1943
65,432
26,646
84,012
280,538
August
1943
21,270
29,952
12,185
63,233
AntonioAugust
July
1042
1943
20,e18
14,763
3UOO
17,696
8,919
UOQ
16,370
37,809
COMPARATIVE TOP LIVESTOCK PRICES
(Dollars per hundredweight)
~Fort Worth---~--S.n
August
1943
$13.75
13 .00
13 .50
11.50
13.00
14.35
13.60
Beefsteers ........... ... .
Stocker stoers ....... ... . .
Heifers and yearlings . . .. .
Buteher cows ...... .. ... .
Calves ..... . . ........ . . .
r~:b,; :: :: :: : :::::::::: :
August
1042
$13.75
12 . 50
14 .00
10.00
12.75
14.85
14.00
July
1943
U5.50
13 .50
15 .25
12 .25
14.00
14.50
14.00
August
1943
512.90
13. 00
11.50
13 .60
H.25
AntonioAugust
July
1942
1943
$12 . 75
SIUO
13 .00
10.00
13 .00
H .40
CROP PRODUCTlON-(Thousands of units)
- - - T exas
Eleventh DistrictEstimated Production Estima ted Produotion
Crop
Unit
Sept. 1, 1043
1042
Sept. 1, 1043
1942
Cotton.. . . . . . . . . . . . . . . . .
Bales
2,000
3,038
3,688
3,745
Corn... . . . . . . . . . . . . . . . . . Dushels
83,979
78,561
96,909
93,887
Wi nter wheat . ..... . ..... Bushels
35,607
47,438
30,386
49,053
Oats ............. . ... , .. Bushels
15,004
11,210
19,871
15,181
Barley. . . . . . . . . . . . . . .• . . Bushels
3,682
4,818
10,500"
18,111;
Hiee. . . . . . . . . . . . . . . . • . . . Dushels
20,592
16,498
20,502t
16,498t
H'oomcom. . . . . . . . . . . . . . Pounds
4,400
6.600
26,060£
44,000.
59,475
59,676
72,735
75,557
Grain sorghull1ll.. . ... .... Bushels
Tame hay. . .. . ... .. .....
Tous
1,264
1,441
1,704
1,089
Peanuts. . . . . . . . . . . . . . . . . Bushels
123,200
430.080
618,300+
580,970'
6,150
5,301
7,540
6,068
Potatoes, Irish. . . . . . . . . . . Bushel.
Potatoes, sweet. . . . . . . . . . Bushels
6,300
3.826
15,042+
IM33:
Peaches . . . . . . . . . . . . . . . . . Bushels
000
1,610
1,392 a
2,582.
Pecans .. '" .... . ... . ... . Pounds
21,750
10,300
44,290+
22,200
'Ari zona, New Mexico, Oklahoma, and Texas. tTexas only. tNcw Mexico, Okinholll&'
and Texas. 0Arizona, Louisiana, New Mexico, Oklahoma, aDd Texo.. +Louisiana,Oklabelll&'
and Texas. Other data for Eleventh Distriet derived from estimatea by statce.
SOURCE: United States Department of Agriculture.
CASH FAUM I NCOME
(1' housands or doll.rs)
- - - .July, 1943
- Reoeipts from: ~ July
1943
Crops Livestoek'
ALoriu,I'O?laan.•...... · . · . ..... . . ... ....
s
. . ' '
New Mexico. . . . . . . . . • . . .
Oklaboma .......... , . " .
Tox.s..... .. .. . . ... . .. . .
4,41 8
2,285
3,084
17,804
27,150
2,262
4,660
2,802
23,733
42.173
M 80
e,054
5,976
41,627
60,823
Total receip t s - - July
Jao. 1 to July 31
1942
1043
104 2
5,325
4,175
·1,948
40,066
56,712
Total. . . . . . .. .. . 64,881
75,729
130,560
120,226
' Inoludcu receipts from the sale of livestock and lil'e3took proclucia.
SOUUCE: UDlted States Department of Agriculture.
57,820~
80,364
73,413
40.257
184.579
630,956
63,2
28,4 19
156,8~~
382,3
900,seQ
6aB.8;2
i
I
I
I
MONTHLY BUSINESS
POPULATION CHANGES, 1940-1943
The marked changes which have occurred in the location of
the civilian population since the beginning of the N ational Defense Program are emphasized by a comparison of population
d~t~ for April 1, 1940 with Bureau of Census estimates of the
cIvilian population as of IvIarch 1, 1943 based on registration
for War Ration Book Two. The civilian population of the United
States decreased by 3,100,000 persons, or 2.4 per cent, during
~he period. The civilian population of the five states included
In whole or in part in the Elevent h Federal Reserve District
declined 2 per cent during the period, reflecting small losses in
LOuisiana and Texas and marked declines in New Mexico and
~klahoma which more than offset the increase of 15.5 per cent
In Arizona.
The number of civilians in metropolitan areas in the United
S~a~es increased 2.5 per cent in spite of the overall decline in
cIvIlian population. The total civilian population in non-met ropolitan areas decreased 7 per cent. This shift of population to
urban centers was more pronounced in the Eleventh District
than in the nation. The civilian population of the 12 metropolitan counties in this district increased by 310,000 persons, or 13
per cent, between April 1, 1940 and March 1, 1943. Caddo
Parish, in which Shreveport, Louisiana, is located, was the only
metropolitan county in the Eleventh District which experienced
a decline in civilian population. The civilian population of the
metropolitan counties of Texas increased by 328,000 persons,
o~ ~5 per cent, as compared with a decrease of 9 per cent in the
ClYtiian population of the 243 non-metropolitan counties of
the State.
The four larger cities in Texas accounted for 70 per cent of
t~e increase in the civilian population of the metropolitan countIes of the State. The San Antonio area experienced a growth.
of 96,000 persons, the largest numerical increase, but Corpus
Christi had the greatest proportional increase with a growth of
32 per cent.
ESTIMATES OF CIVILIAN POPULATION
(Thousand. of peroon. :
Str.to
Maroh I, 1043
t!11.O~" """""""
674
A'
Ne~.MnR : .. ..
.. .. .. .. .
Okl h Olleo.. ...... .. .
1'el~a~~~: :::::::: ::: :
2,350
2.1~~
6,337
May I, 1042
496
2,425
521
~:m
April 1, 1040
497
2,359
631
m~
EstiDlllted chan ~o
between April I, 1940
and March I, 1043
Numbor
+
77
0
41
Pcr cent
+15.5
- 0 .4
- 7.6
=2!~ =~:~
'I'otal d ..... """... .. ...
Un't fiv •••• _
11,854
12,052
12,098
- 244
- 9 0
~.
I eState..... .... ..
128,231
130,082
131,323
- 3,092
- 2.4
at bSOURCI!J: United btat.,., Bureau of Consu •. EstimateD for March I. 1043 Dod May I, 1042
e a.ed on registr.tion. for Ration Book Two and for Ration Book Ono, respeotively.
ESTIMATED CIVILIAN POPULATION IN METROPOLITAN COUNTIES
(Thousands of per800.)
Estimuted ohatge
between April I, 1040
and March I, 1943
City and County
Aprili,
March I, May I,
1942
1948
1940
Numher Per cont
Toxa.
51
54
68
-I- 0.2
+4
~~r~II(0Tr(l'o~ter County) ........ , ..
112
111
117
0. 9
lle
nVI. COllnty ............ ..
1
174
159
145
+19 .8
Co~mont-Port Arthur (Jefferson Co.)
+29
122
lI8
93
+29
+31.6
Dall,uS Chriati (Nucee. Oounty) . ... .
429
443
398
III pas (Dalla. County) . . .. ....... . .
+ 45
+ 11.3
135
136
126
~'Ott'W (EI Paso County) ...... . . . . .
+10 + 8. 0
226
256
235
+13.4
+30
Gal orthd Tarrnnt COUDty) ..... . .
87
80
98
+18
+23.2
llouV~toD ( alvcston County) .. .. .. .
563
529
587
+11 .0
San ~on (Harri. County) . . . ...... . .
+58
352
412
316
+30 .5
+96
Wac (~nio (Bexar County) ........ .
108
102
100
o cLennan COllnty) .. ....... .
+ 7.3
+ 7
+
+
Sb
Loui.iana
tev"patt (Caddo Pari.b).. .. .. .. ..
132
156
150
- 18
- 1l . 8
at bSOURCE: United Statea Bureau of Censu•. EetilDl\tcs for March I, 1943 aDd May I, 1942
t aoed OD registrntions for Ration Book Two and for Ration Book One, respectively.
THE COTTON INDUSTRY, 1939-1943
Since the beginning of the war in Europe, there have been
deVelopments which have influenced materially the operations
of domestic cotton mills and the experience of cotton producing
a eas in the United States. Domestic cotton mills have increased
t eir annual consumption of cotton by 4,300,000 bales since
~he 1938-1939 season thereby more than offsetting the decline
ltl foreign mill consumption of American cotton that has taken
R~VIEW
place as a result of the blockade of Europe, the cessation of commerce with Japan and the difficulty of transporting cotton to
other parts of the world. Domestic mills have also changed
markedly the quality and construction of fabrics produced in
order to confirm to military requirements and to speed production. Partly as a result of these developments, much larger
quantities of longer staple cotton of the better grades have been
required, whereas smaller quantities of lower grade and shorter
staple cotton have been consumed.
Foreign .mill .consumption of American cotton averaged 5,400,000 running bales per season during the 1934-1939 period
and was, on the average, somewhat less than 1,000,000 bales
smaller than domestic mill consumption. In the 1940-1941
season, foreign mill consumption of American cotton declined
to 2,291,000 bales and in the 1942-1943 season fell to 1,160,000 bgles. After 1939, rising individual incomes stimulated
civilian demand for cotton textiles in the United States and
Government purchases for military and lend-lease purposes expanded rapidly, with the result that domestic mill consumption
of American cotton increased to 9,576,000 bales in the 19401941 season and to 11,025,000 bales in the 1942-1943 season.
The change in the character of the market for American cotton was not confined to a diversion of deliveries from foreign
to domestic mills. Most cotton mills in the United States are
designed to process medium or longer staple cotton of medium
grade or better; foreign mills provided the largest market for
our shorter staple before the war. One of the effects of the war
was, therefore, to increase the demand for the former and curtail
the demand for the latter types of cotton. This development
benefited cotton producers in areas which are adapted to production of longer staple cotton but was unfavorable to sections,
including much of Texas, whose cotton crop is customarily
comprised largely of shorter staple cotton. It likewise provided
inducements to increase output of longer staple and to take
greater care in picking and ginning in order to improve the
grade of cotton.
Between August 1, 1942 and July 31, 1943, approximately
70 per cent more cotton was consumed in domestic mills than,
on the average, during the five seasons before the war, Shortly
after the beginning of the war in Europe, domestic cotton mills
changed from the single shift basis to a standard two-shift basis
and lengthened the work week from five to six or seven days.
It was at first comparatively easy to bring idle machinery into
operation and to lengthen the hours of operation of active machines, since supplies of raw cotton were ahundant and the
reservoir of labor was large, Although military orders were
superimposed upon the expanding civilian business of the mills
in 194 0 and 1941, output was increased rapidly enough to satisfy demands from both sources, Early in 1942, however, it
became necessary for the War Production Board to exercise
control over the distribution of some cotton fabrics to insure
that military and essential civilian needs would be met, Later
AMERICAN COTTON- MILL CONSUMPTION
~UNNING BALES)
MI
3
,nNO OF BALES
MI\.LIONS OF BALES
0
f OUllNCOVMlltU
UIIUI" UD IlAHI
25~-----------------------------------------------125
0
15
10
h
6
'."4'
0
e
MONTHLY BUSINESS REVIEW
in 1942 and early in 1943, mills were directed to convert looms
to production of new types of fabrics required by the military
services. Fabric qualities were changed by reducing thread
counts per inch in order to speed weaving, and 60 per cent or
more of the yardage output of the mills was brought under
conversion orders which control fabric qualities and their distribution. These actions facilitated capacity operation of the
industry. Nevertheless, during the season just .ended the mills
experienced some difficulty in maintaining operations at maximum levels due to labor shortages and inability to obtain additional machinery and replacements for worn-out equipment.
Throughout the 1941-1942 and 1942-1943 seasons, Government purchases absorbed perhaps 65 per cent of the output of
domestic cotton mills. The amount of cotton goods. available to
civilians was curtailed and was inadequate to satisfy all civilian
demands. The tight civilian supply situation eased somewhat
toward the end of the 1942-1943 season and in recent months
retailers have apparently been able to obtain more prompt deliveries of cotton fabrics. It seems likely, furthermore, that
greater quantities of cotton goods will be available to the civilian trade in 1944. It has been announced that contracting for
standard cotton fabrics for Army use will be slowed down after
October 1 this year and that Army requirements for such items
in 1944 will be 50 per cent smaller than in 1943. The potentiality that better quality fabrics may be available at the same or
lower prices may cause merchants to exercise greater caution in
placing orders for replenishment of depleted inventories of
cotton goods at retail and wholesale establishments. The backlog of civilian demand is quite large, however, and activity at
domestic mills will probably be sustained at a relatively high
level for some time.
The price of raw cotton and the wholesale price of cotton
goods were higher, on the average, during the first six months
of 1943 than during any comparable period in the preceding
ten years. During the 1938-1939 season, the average farm price
of cotton was 8.60 cents per pound as compared with the parity
price of cotton of 15.66 cents per pound. The average farm
price of cotton subsequently increased more rapidly than the
prices of the components of the cotton parity price and during
the first six months of this year closely approximated the parity
price. In April 1943 a program to stabilize raw cotton prices was
initiated which provides that Government owned cotton shall
be offered for sale by the Commodity Credit Corporation at
prices equivalent to the average 1O-spot market price on April 7,
1943. On that date, the average 1O-spot market price of 15/ 16inch middling was 21.38 cents per pound. During July 1943,
15/ 16-inch middling averaged 21.11 cents per pound on the
10-spot markets, as compared with 9.66 cents per pound during
July 1939. By the end of 1941, the wholesale price of cotton
goods had increased to 160 per cent of the 1939 average, but
price controls were instituted shortly thereafter, and since raw
cotton continued to rise in price, mill margins were narrowed.
In June this year the wholesale price of cotton goods was 167
per cent of the 1939 average, whereas the average price of cotton
on the 10-spot markets was 227 per cent of the 1939 average.
Mill margins on 17 constructions of unfinished cloth, which
measure the difference between the price of raw cotton and the
equivalent cloth prices, have been consistently greater during
the 1940-1943 period, however, than during the years preceding the war. Mill margins increased rapidly from the end of the
1938-1939 season to August 1942, when they averaged 22.17
cents per pound, gross weight. Thereafter they declined and in
May and June this year averaged 19.69 cents, as compared with
the 1938-1939 average of 10.44 cents.
The world supply of cotton, which available estimates indicate will exceed world consumption by about 23,000,000 bales
this season, is still nearly as great as in 1937-1938, when it
reached an all-time peak. Although foreign production of cotton has declined markedly since 1939, foreign consumption has
also declined, and the world carryover on August 1 this year
was 3,000,000 bales larger than on August 1, 1940. Virtual!Y
all of tlns increase is accounted for by the larger carryover III
foreign countries. There have been noteworthy changes in the
composition as well as in the size and location of cotton stocks.
Lower grades and shorter staple cotton comprised a substantially
larger part of the carryover of American cotton at the end of
the 1942-1943 season than at the end of the seasons preceding
the war. The stocks of American cotton customarily consumed
by foreign mills are thus larger than before the war, wher~s
the supply of grades and staple consumed by American mills IS
smaller.
At the end of the 1941-1942 season the carryover of American cotton in the United States was still large and equalled
almost a year's consumption by domestic mills at current levels
of activity. Since other agricultural products were in short supply, the Department of Agriculture sought to divert some lands
which were devoted to the production of cotton to production
of other crops, particularly soybeans and peanuts. The cottOn
acreage goal for 1943 of 22,500,000 acres, although 810,00 0
acres smaller than in 1942, was estimated to be adequate to produce enough cotton to meet anticipated demands if properl'y
distributed among grades and staple lengths. In March 1943 ~t
was announced that growers would be permitted to increase the~r
cotton acreage allotments by 10 per cent without penalty. thiS
action was taken to increase production of cottonseed productS
rather than to expand the production of lint cotton. Acreage
in cotton on July 1 this year amounted to only 21,995,000 acres.
the smallest in nearly 50 years and considerably below the allotted
acreage. Weather conditions have been conducive to relatiVel,Y
large yields of cotton, however, and a 1943 crop of approJ(Jmately 11,600,000 bales was forecast on September 1, as compared with 12,510,000 running bales produced in 1942 and the
1932-1941 average of 12,255,000 bales. This would indicate a
1943-1944 supply of American cotton of 23,000,000 bales,
which is about 600,000 bales smaller than in the preceding
season and only slightly smaller than on the average during the
1932-1941 period.
A review of the experience of the American cotton industrY
since the beginning of the war in Europe reveals significant
developments which may influence the industry in the future.
A substantial increase in consumption of American cotton bY
domestic mills has offset the decline in foreign mill consumptiOJl
of American cotton. Largely as a result of this shift in the
market, cotton growers in the United States have been induced
to expand production of longer staple cotton. Stocks of American cotton have not been materially reduced, hut their composition and location have been changed. Stocks of Americ aJl
cotton in foreign countries at the end of the past season were
approximately 75 per cent smaller than before the war and th:
carryover of American cotton in the United States on August
AMERICAN COTTON-SUPPLY
1.41 LIONS OF BALES
(flUNNING BALES)
at 'O~II'" COUNIIUU c.u~"OYUl
.;J\
IIILLIOH1..Qf~ :0
CZ2 I/lIlftO "Uti "'UI"O'll1t
r.::;- ""n ....n ....."'i;tTl-m-=?:-~___-=.;:=;:-f.'01:::.-f,':'';"""""~,,,:_ _ _ _- - I'
~
20~
I~
10
till \. 7: : .:.
\: ~.
r,:::
~~~~lj'A-1'hn~/Av/A~::
1 ~~~rur-.~r@~H~~ MH~~1-0:H0~r-__
J
.,
MONTHLY BUSINESS REVIEW
this year was composed to a far greater extent than formerly of
lower grade and shorter staple cotton, types of cotton which
are Customarily consumed in foreign markets but which are
nOt well adapted to satisfy domestic mill demand.
. The immediate outlook for the American cotton' industry
IS moderately encouraging. Although Government orders at
domestic mills are likely to decline, it is probable that domestic
~ill consumption will be maintained at a relatively high level
In the immediate future in response to civilian demands. Foreign
demands for American cotton and American cotton goods may
eXpand as the ocean transportation situation improves and it
seems probable that they will increase substantially immediately
~fter the war. An increase in foreign mill activity might result
In the export of a large part of the shorter staple and lower grade
American cotton accumulated since 1939. It would also eventually bring foreign mills into competition with domestic mills.
MILL CONSUMPTION OF CO'l'TON-1935-1942
(Thousands of runuinR bales)
~ American Cotton
All kind. of oottoo--Year beginning In United In Foreign
In United In Foreign
Totol
August 1
State.
Countries
Tot.1
State.
Countries
27,529
1935
6,221
6,282
12,503
6,351
21,178
30,688
1936
7,768
5,325
13,093
7,950
22,688
27,573
1937
5,616
5,179
10,705
5,748
21,825
28,507
1038
6.736
4,513
11,249
6,858
21,640
28,486
1939
7,655
5,221
12,876
7,784
20,702
26,542
9,576
2,291
11,867
9,722
16,820
1940
25,572
1941
10,974
1,236
12,210
11,170
14,402
24,900
1942"
1l,025
1,160
12,185
11,200
13,700
SOURCE: United Stotoo Bureau of Agrioultural Eoonomica.
"Preliminary and portly e.timated.
Domestic mills, however, have gained experience during the war
in operating intensively. When the war ends, they should also
be in a position to replace equipment depreciated during the war
with improved machinery and thereby, to reduce unit costs of
production and to improve their competitive position on the
international market.
WORLD SUPPLY OF ALL IUNDS OF OO'l'TON-1935·1043
(Thousauds of running bale.)
Carryover, August 1
In Foreign
World
Yeariibeginning ; . In United
August 1
Total
Produotion
Countries
States
7,864
15,072
26,141
7,208
1935
8,240
13,649
30,729
1936
6.409
0,196
13,695
36,745
4,499
19S7
22,702
11 ,169
27,509
1938
11.533
27.326
21,638
8,605
1039
13.033
20,272
9,708
28,594
1940
10,564
P,R75
22.041
104 1
12,166
26.057
11,736
22,376
26,260
10,640
1042"
12,646
23,586
10,940
1943"
SOURCE: United Statoo Buroau of Agricultural Eoonomi09.
'Preliminary and partly estimated.
World
supply
41,213
44,378
50,440
50,211
48,964
48,866
48,098
48,636
WORLD SUPPLY OF AMERICAN COTTON-1935·1948
(Thousand of running bal09)
_ - - - Carryover, Au~ust 1
0-n ForeIgn
In United
Ycar beginning
. t.Statoo
.
. . Countries
'rot.1
Produotion
August 1
10,405
1,904
9,041
7.137
1035
1,662
6,998
12,375
5,336
1936
18,412
1,848
6,235
4,387
1937
2,34 1
11,665
11,446
13.787
1988
14,137
11,418
1,181
12,056
1039
12,542
12,805
10,169
2.078
1940
12,797
10,628
771
12.026
1941
12,510
11,115
610
10,505
1042"
11,340
11,600
500
10,840
1943"
SOURCE : United St.ntes Bureau of Agrioulturesl Economi09.
"Preliminary and partly estimated.
World
supply
19,536
19,373
24,647
25,452
25,555
24,847
23,425
23,625
22,040
:,1
MONTHLY BUSINESS REVIEW
OCTOBER I, 1943
NATIONAL SUMMARY OF BUSINESS CONDITIONS
( Complied b7 the Board of Governon of the Federal Reaen. S7.teen)
I/~
tJ l V
I
tff
' ....altN(IIY"
80
1941
1943
60
20 '
o
H=rJ
1
939
eo
.0
- " '1. . ,j'.'--
L
) IV
t939
I
NOtIOUIIAII!.L
J
~
140
100
f
"
".... V
160
Industrial activity and war expenditures were maintained in August at a high level. CommoditY
prices showed little change. Retail trade continued in large volume.
_ II .. ,
~N r--
I
180
'.,001.
1.
"=-
200
120
~
INDUSTRIAl. PRODUCTION
_ ra. _ .. .... ,.
___
"
[J
1
941
20
o
1943
Federal Reserve indexes. Groups are expressed in
terms of points in the total index. Monthly figures,
latest shown arc for August, 1943.
DEPARTMENT STORE SALES AND . STOCKS
18 0
~--4----t---7----r---t---~A---lI~
INDUSTRIAL PRODUCTION
Output of manufactures and minerals showed little change in August and the Board's seasonally
adjusted total i~dex of industrial production remained at the July level. Production of durable ~.nu~
factures increased. Output of iron and steel continued to advance and reached the peak levels achIeve
earlier this year. There were further slight increases in activity at war plants in the transportation
equipment industries. Output of other durable products .howed little change.
Production of nondurable goods declined in August, reflecting further decreases in output 01
textile, leather, and food products. Cotton consumption in August was about I S per cent lower than
the same period a year ago and was at the lowest level since the beginning of 1941. Leather outpU~ ha'
also declined in recent months and is currently close to prewar levels. Activity at meatpacking plant!
showed the usual seasonal decline in August but preliminary figures indicate that output was about
one-fifth larger than a year ago. Output of most other manufactured foods declined somewhat furth~ri
Production of petroleum, coke, and rubber products continued to advance in August while chemica
production showed little change. Production of crude petroleum continued to rise and in August ~a'
in the largest volume on record. L:>.ke ~hipments of iron ore likewise reached a record level. ProductIOn
of coal and metals was maintained in large volume.
'40
DISTRIBUTION
120
100
80
I--:-=-:t- "'---t---jl----j--:; -,-'---/----i 80
"
~-~--r_-_r---r_--_r--~r_--~.o
1937
Federal Reserve indexes. Monthly figures, latest shown
arc for August, 1943.
MEMBER BANKS IN LEADING CITIES
Department store sales continued large in August and the first half of September. Increases dur~n~
this period were less than seasonal, however, following maintenance of sales at a comparativdy hlg
level during July. For the year to date value of sales at department stores has been about 13 per cent
greater than in the corresponding period last year, reflecting in part price increases. Inventories. Jt
department stores have increased in recent months and are now somewhat higher than at the beginnIng
of this year, indicating that receipts of new merchandise have been in excess of the value of goods sold.
Total carloadings were maintained in large volume during August and the first half of SePtembe~
Shipments of grain showed a less than se;uonal decline from the peak re:tched in July and were one-fift
larger than August a year ago.
COMMODITY PRICES
The general level of wholesale commodity prices continued to show little change in August all d
d
the early part of September. Prices of lumber and newsprint were increased, while prices of fruits an
vegetables showed further seasonal declines.
•
..,..,0:....._-1-_ _-1 1.
In retail food markets prices of apples and fresh vegetables decreased further from mid-JulY to
mid-August. The Bureau of Labor Statistics cost of living index declined one-half of one per cent al
decreases in foods were partly offset by small increases in retail pricta of other goods and services.
AGRICULTURE
ob:=-~==~~~~~~~L-~
1"9
I~O
1M
1-
Demand deposits (adjusted) . exclude V. S: G<?vernment and interbank deJ;>Oslts and collection Items.
Goverlltnent securities Include direct and guaranteed issues. Wednesday figures, latest shown are for
September 15, 1943.
MEMBER BANK RESERVES AND RELATED ITEMS
General crop prospects declined slightly in August according to official. reports. The foreca,t fat
corn production Was raised by 3 per cent to almost 3 billion bushels while prospects for other feed crops
declined. Production of cotton indicated on September 1 was 11:7 million bales as compared with J
crop of 12.8 million last season. Milk production in August was estimated to be 2 per cent smaller thall
output a year ago, W h'le mar k '
I
etmgs 0 f most other livestock products continued in larger voIume than
last year.
. ...L_ • ., .... L~
••
20 1 - - -- -1-- - - j
·/
--t-~--il---t--~
.0
_-j-,.'O<"'__--j l '
'6
1938
1939
Wednesday figures, latest shown arc for September IS,
1943.
BANK CREDIT
In mid-September excess reserves of member banks rose sharply to about 2 billion dollars fro~
the average level of about 1.1 billion which had prevailed in the latter part of August and carly sn
September. This increase was due in part to the fact that the Treasury was making disbursementS out
of temporary borrowing from Reserve Banks on special certificates in anticipation of taX c,olIect~'011'
cd
and receipts from the Third War Loan Drive. It also reflected in part a <ubstantial decrease in requlr
reserves at the middle of the month when funds from , individual and .corporate deposits were era11'r
ferred to Government loan accounts which arc not subject to reserve requirements. During the fou
weeks ended September 1 S the R eserve System holdings of Government securities increased by about
e
1 billion dollars in addition to the special certificates taken directly from the Treasury. Most of :h
.
' th f
f Treasury bslls sold to the Reserve Banks with sellers retaining the optlon
.
mcrease was tn corm 0
.
trepurc o vcr t h' f our-week peflod currency in circulation increased by about S60 ml'lhon
'
o h ase.
IS
dollars to a total of 18 .8 billion outstanding.
@FedFRASER