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This publication was digitized and made available by the Federal Reserve Bank of Dallas' Historical Library (FedHistory@dal.frb.org) Trade Balance- Farm Exports Could Be Pushed To Help Off~et Rise in Fuel Imports The nation has shown a deficit in its balance of payments most years since World War II. But until 1971, the nation's merchandise trade balance was positive. And this surplus in trade offset much of the deficit resulting from other factors. In the past two years, however, the payments deficit has been aggravated by a growing net trade deficit as imports have risen much faster than exports. And as the trade balance has deteriorated, increasing attention has been given t? two industries that are espeCIally important to the economy of the Southwest-petroleum and agriculture. Agriculture has remained a major source of strength in the trade balance, showing growing net surpluses in the face of the general decline. But with large net trade deficits being recorded in petroleum and petroleum products, fuels have been readily identified as a definite present and future problem. Since no quick or easy solution has been found to moderate the expected growth in fuel imports, focus on these two industries has intensified. Of the industrial com- ponents making up the nation's merchandise trade, agriculture seems to offer very real possibilities for the expansion in exports needed to help balance the rapid increase in fuel imports. Not only is world demand for farm products expected to rise rapidly, but the United States has a comparative, if not absolute, advantage among nations in the world in its ability to expand agricultural production to meet any rise in foreign demand. Of course, any exhaustive study of expected future trends in the nation's balance of payments must Deficit also develops in trade balance BILLION DOLLARS 16 --_____________________________________________________________________________ 12 U.S. MERCHANDISE TRADE BALANCE 84- o - ______ ~'" -4 _ U.S . BALANCE OF PAYMENTS -8 - -12 _ -16--T-________~----------~----------~--------_,----------_rL-~------r_'45 '50 '55 '60 '66 '10 '75 SOURCE: U.S. Department of Commerce ....... liu' Slhess Review I September 1973 1 Energy consumption outrunning production QUADRILLION BTU 'S 130 110 - 90 - 70- 50- 30-;----~r-----~----_r----~r_----,_----~------r '50 '55 '60 '65 '70 '75 'SO 'S5 SOURCES : U.S. Bureau of Mines Federal Reserve Bank of Dallas consider all of its components and their interaction. A narrower focus necessarily sacrifices some of this interaction in order to concentrate attention on a smaller number of components of more immediate interest. And in view of this nation's strength in agriculture, it seems logical to ask whether, by itself, an increase in farm exports could provide the funds to pay for the expected increase in fuel imports. Potential for fuel imports The nation has been relying on fuel imports since it began consuming more energy than it produced about 20 years ago. The energy gap widened significantly in the late 1950's but held fairly constant through most of the 1960's as U.S. energy production expanded to keep just about apace with consumption. In 1970, however, the gap widened sharply as domestic production dropped off for the first time since the 1957-58 recession. 2 And indications are that it will widen still further. There has been little success so far with efforts to curb fuel consumption in this country. And the outlook through 1985 is for energy demands to continue rising-and probably faster than in the 1960's. Efforts have also been made to encourage more exploration for domestic oil and gas. But it will still be years before these efforts are reflected in gains in production. Meanwhile, environmental and other constraints hamper growth in output of fuel, as well as the development of nuclear energy. Unless policies can be initiated to stimulate faster growth in domestic production, approximately 30 percent of the energy consumed in the United States in 1985 may have to be imported. That will be in contrast to only about 12 percent in 1970. Just how heavily fuel imports will w.eigh on the nation's trade balance depends, of course, on not only the volume of imports but also their prices. Prices, in turn, depend partly on the origin of the imports. In the past, most of the fuel coming into this country has been petroleum from other countries in the Western Hemisphere, mainly Canada and Venezuela. But for several years now, the proportion coming from the Eastern Hemisphere has been rising. Last year, nearly 30 percent came from the Eastern Hemisphere, principally from Arab countries. And with some 70 percent of the world's proved oil reserves in Africa and the Middle East, this trend toward more imports from Arab countries is apt to continue-with possibly higher prices. Tanker costs from the Middle East are, of course, much higher than costs for shipments from within the Western Hemisphere. Also, with the Middle Eastern countries controlling most of the world's reserves, a seller's market exports of Soviet oil are not apt imports could boost the cost of net puts them in a position to com. to be enough to ease upward presfuel imports to around $34 billion mand higher prices. With world by 1985-compared with $2.1 billion sures on world prices. demand running as high as it is, in 1970. If so, imports of fuel alone If Americans continue to inthese countries could raise crude crease their foreign purchases of in 1985 would be nearly as large as prices simply by holding back on receipts from all U.S. merchandise more expensive refined products, production. exports in 1968. (Implicit in this average import prices may be The payments problem of imoutcome is an assumed increase in boosted even further. And this ports from the Middle East is furthe cost of fuel imports of 3 percent could be accelerated if expansion ther complicated by the size of a year.) of domestic refining capacity is repopulations in these countries and With appropriate incentives for strained either by environmental the historic composition and habits concerns or by constraints of taxing domestic exploration for additional of their people. Unlike Canada and or pricing policies. fuels (principally oil and gas) and Venezuela, Arab countries have development of additional petroTo stimulate the production limited needs for American goods. leum refining capacity, growth in needed to hold back growth in imAs a result, the shift toward the the nation's dependence on imports ports, domestic prices may have to could be slowed-particularly after M.iddle East as a source of fuel sup- rise even faster than import prices. plIes diminishes the possibility that But consumer resistance to inthe midseventies, when current efforts to increase production have dollars spent for oil imports will creases in prices is to be expected, had time to begin taking effect. flow directly back into the United as, possibly, are the environmental States in payment for American concerns that constrain the growth The National Petroleum Council, eXports to these countries. of both refining capacity needed for for example, has estimated that . The Soviet Union is another pos- the high-sulfur crudes coming from with stronger price incentives and removal of environmental reslble source of oil. That country is overseas and the mining and drillstraints on domestic industries proing operations needed to step up reported to have considerable oil ducing energy, the rise in the net domestic production. Potential and, having shown intercost of fuel imports could be held est in American products, offers On balance, the combination of Possibilities for bilateral trade. But higher prices and greater volume of to $7.5 billion in 1985. That would Recent net farm exports almos t equal net fuel imports BILLION DOLLARS 6 ____________ ~_______________________________ 4- -4 _ I -6 - IZI U .S . FARM TRADE BALANCE EI U.S. FUEL TRADE BALANCE U .S. MERCHANDISE TRADE BALANCE -8_______________________________ '66 '67 '68 '69 '70 ~~--~~- ' 71 '72 SOURCES: U.S. Department of Agriculture U.S. Department of Commerce ...... nu'Slness Review I September 1973 3 be at 1970 prices, however. If prices rose 3 percent a year, even this sharply reduced level of imports would cost $11 billion in 1985. The further development of nuclear, solar, or coal energy supplies could also reduce this nation's needs for foreign oil. But it will take time and incentives to develop the capacity needed to supply more energy from these sources-particularly where new technology has to be developed. Scientists hope that, eventually, most domestic energy needs can be drawn from a nuclear fusion process that will permit consumption without reliance on depletable resources. In the meantime, the United States will have to consider appropriate policies and actions, including those designed to increase merchandise exports, to pay for the increase in oil and gas imports. And farm sales represent one of the important components of foreign trade that could be expanded enough to make a material offset to the rise in fuel imports. supplies of fish meal short, world demand for soybeans soared. As farm shipments increased far more than expected, domestic supplies suddenly turned short. Furthermore, the stage of the cattle cycle combined with continued growth in feedlot operations to increase demands for feed. About 40 million additional acres of cropland have since been put into pro- More U.S. oil imports expected to come from Eastern Hemisphere ... MILLION BARRELS A YEAR 700----------------------------------------------- Potential for farm exports Export markets have always been important to American farmers, and farmers have been shipping more of their products abroad over the years. Foreign sales had been trending upward for more than 20 years when they suddenly surged over the past year, leaving domestic supplies unexpectedly short. Several factors were reflected in this unexpected bulge in exports. Aside from the longer-term growth in world demand for food and feed, there was, of course, the opening of trade with the Soviet Union that resulted in an enormous drain on U.S. grain bins. But there were also drouths in several of the world's major crop-producing areas, as well as a sharp drop in Peruvian exports of fish meal, a source of protein used in feed for livestock. With 4 duction in the United States. Because some of this additional acreage, which had been set aside under Government crop programs, was not released early enough for proper planting, production may not reach its full potential until next year. But by then-especially if weather in other important growing areas has returned to normalU.S. production may be ample to '45 '50 '55 '60 '65 '70 '75 ... and refined products to make up more of total BILLION BARRELS A YEAR 1.6 - - - - - - - - - - - - - - - - - - - - - - '45 '50 '55 SOURCE: U.s . Bureau ot M In88 '60 '65 '70 '75 meet the upward trend in foreign export demand and still satisfy domestic consumption requirements. Most of the nation's farm shipments have usually been to developed countries. The biggest markets for U.S. farm products have been in Canada, Japan, and West Europe. But exports to less developed countries are also growing. And with the opening of new trade relations with the Soviet Union and other Communist countries, shipments likely can be expected to rise still higher. To help meet the increase in world demand, the United States is better endowed with resources for agricultural production than any other country. With only 7 percent of the world's land mass, it has more than 12 percent of the Middle East has 70 percent of world's crude oil reserves BILLION BARRELS 150 ________________~------~------------------------SAUDI ARABIA 100- USSR IRAN 50 _ UNITED STATES IRAQ ABU DHABI SOURCE: World 011 - Business Review I September 1973 cultivated land and nearly 9 percent of the pastureland. More importantly, in roughly the Corn Belt, it has about half the world's farmland with long summers of adequate rainfall. And in the old Cotton Belt across the southern states, it has a third of the world's humid semitropic farmland. Combinations of temperate climates and fertile soil make these two regions suitable for the production of many crops, especially feed grains and soybeans-the crops in most demand. Together with other productive agricultural areas -such as the upper Prairie States, where short summers of adequate rainfall provide abundant grain harvests, and the dry southwestern and Rocky Mountain states, which provide the base for extensive cattle operations-these regions give the United States an absolute advantage in agriculture that parallels the Middle East's advantage in petroleum. To the advantages of climate and soil can be added the rapid gains in productivity characterizing American agriculture. These gains have long provided expanding domestic markets with plentiful supplies of farm products while still making large amounts of products available for export. Growth in productivity has been achieved mainly through technological advances and improvements in the organization of resources that encourage the substitution of capital for labor. Until this year, however, lack of effective markets prevented even faster gains in productivity that could have been achieved if returns to agriculture had been better. With gains in production already outstripping the rise in domestic consumption, until this year, inputs to agriculture have been increased only slightly since 1960. Now, with incomes rising world5 wide and markets strengthening, there are new opportunities for the application of unused agricultural capacity. And with the use of this capacity, even faster gains in productivity can be expected. Continued advances in technology-including more productive varieties and more efficient cultural practices-along with increased use of fertilizer and other capital inputs, will doubtlessly push yields much higher over the next few years. And production gains-of possibly as much as 50 percent by 1985-will be far more than needed to meet the projected growth in domestic consumption, leaving an ever-widening margin of capacity for meeting export demand. Such increases in output would reflect the addition of some 50 to 60 million acres of cropland that has been held out of production. Altogether, this land, which includes the 40 million acres recently released, totals about 15 percent of the nation's cropland. Almost all of this vast reserve will probably be needed to meet the rise in demand for farm products. With the gains to be expected in productivity and more land going into use, rapid strides can be made in production of both crops and livestock. And if projections are anywhere close to accurate, farm output should be ample to meet the rise in domestic demand and still provide large amounts of farm products for export through at least 1985. If livestock production increases over the next 12 years at about the same rate as in the past 12 years, output in 1985 will be more than a fourth higher than it is today. Poult ry and beef production will most likely lead the advance, rising much faster than the nation's population. Pork production will probably rise in line with population. U.S. farm export markets expand rapidly in 1973 BILLION DOLLARS 14------------------------------------~-------------12 - ~ - DEVELOPED 10 - COMMUNIST 86- 4- SOURCES: U.S. Department of Agriculture Federal Reserve Bank of Dallas 6 Because of continued strengthening in export markets, growth in crop production will probably be even faster than over the past 12 years. By 1985, production should be more than two-fifths higher than today. Leading the advance will be soybean production, which is apt to double, and the output of feed grains, which could increase almost half again. Production of wheat and cotton will probably increase a fifth, and rice a third. Even with the rest of the world also increasing its agricultural output, this country's share of total world trade in farm products should rise significantly between now and 1985. Demand for food is governed, in the main, by three factors-population, income, and production. World population is expected to reach close to 5 billion by 1985-a 35-percent increase over 1970. During that time, individual incomes are projected to rise about three-fourths. But on a per capita basis, agricultural production will have risen only about 9 percent. Reflecting these projected changes, world trade in agricultural products is expected to adVance some 60 percent. And since gains in per capita production in less developed countries will be needed to make up local deficiencies in output, surplus farm production will be concentrated in only a few countries-one of the most important of which will still be the United States. So while diminished domestic stocks make for uncertainty in the nation's export farm markets right now, the longer-term outlook is for rapidly expanded shipments ~broad. Overall, U.S. participation lU world markets by 1985 should at least match the projected 60percent increase in total world agricultural trade. If so, this country's farm exports could, in con- - stant dollars, be worth nearly 60 percent more than in recent years. Because production of wheat, cotton, and rice is so widespread, the outlook for these crops may not be as bright as for other farm products. Since the Soviet Union and East Europe will try to grow most of their own wheat, wheat exports from the United States may increase only moderately between now and 1985. Some increases in rice shipments can probably be expected. But cotton growers in the United States will still face the uncertainties of competition from both synthetic fibers and cotton grown in other countries. Among crop exports, the most favorable outlook is for soybeans, which is not only a highly versatile crop but also the most economical source of protein available. Growth in soybean shipments could easily keep up with gains in production, possibly doubling by 1985. And because increasing world affluence has created additional demand for fed cattle, the outlook is almost as good for feed grains. Compared with crop exports, livestock shipments will be small but still higher than in recent years. And for the longer run, there is a possibility that livestock feeding might expand still further in the United States, providing meat that could be exported instead of feed grains. Against these exports must be counted considerable farm imports that will hold down the net contribution of agricultural sales to the balance of payments. Farm imports, rising about $250 million a year, reached a level of more than $6 billion in 1972. This upward trend is almost certain to continue. Much of the increase in purchases of foreign farm goods is apt to be in either those that are highly labor-intensive, such as fruits and Farm production expected to rise sharply . .. far exceeding domestic consumption 1960=100 170 _______________________________________ 1960=100 170 p~ 150- " , ~~' ~~ 130 - DOMESTIC '60 '65 '70 '75 '80 '85 90 " ,- .J~ ~ ...... ~.S. FARM 100 - 90~------~----~------~----~------r_ ~~ "" U.S. FARM ........... OUTPUT ............... ... ............... 110 100 ... CONS~UPTION ~ ~~ ~~ INPUT I '60 '65 '70 '75 '80 '85 SOURCES: U .S. Department of Agriculture Federal Reserve Bank of Dallas -- nUsiness Review I September 1973 7 vegetables, or those with regulated prices, such as dairy products. And PERCENT if trade is to be liberalized-a move 200 --------------------------------------------------~ that would benefit U.S. exportsother American farm products will have to be subjected to foreign competition. The adverse effect on 150 the farm balance from such imports would be small, however, compared with the possible gains in exports. Although this country's farm ex100 ~ l!'!'!\' ports are increasing as economic t;:i;-i ~t: relations shift worldwide, growth \.~l~ ~g t~~; in trade is still hindered by con". ~:~ ' r-;\~ ~ @l ~:~=f, flicts between the domestic and ~~~f· 50 ~~.~~ foreign policies of all countries. In ~1:~~ ~i:'~~ agriculture, as in petroleum, these iN, policies are closely related-and Xir I~~\~~ ;t~~:; ~ ~ ~ ~ ~ generally at odds with conditions o '7 0 '85 , '70 '85 '7 0 '85 ' 7 0 '85 of free trade. PER CAPITA PER CAP ITA TOTA L POPULATION If there is no change in U.S. agGROSS WORLD AGR ICULT URAL AGRIC ULT URAL ricultural policies and the world PRODUCT PRODU CTION TRADE economy continues to expand at SOURCES: Internatio nal Monetary Fund and Wor ld Bank about the rate projected, U.S. farm U.N. Food and Agricultu re Organizati o n exports will probably be around Federa l Reserve Bank of Da ll as $18 billion by 1985. With agricultural imports projected at $11 billion, the net trade balance in farm products should reach $7 billion. Changes are being made, however. And along with other changes at work on the international scene, they could lead to a liberalization of agricultural trade that would Soybeans and feed grains to lead advance in U.S. farm expor t s allow net U.S. farm balances to go BILLION 1970 DOLLARS considerably higher. One of the most important inter2.5 ----------------------------------------------------national changes is, of course, the ~ '69-'72 rapid expansion of effective world 2.0food markets. With consumer incomes rising, expansion of markets L. .. ~ '85 1.5 for livestock products has been ...., especially rapid. But also important is the growing disenchantment with farm policies that restrict the flexibility of producers' responses to changes in supply and demand. Countries in the European Common Market RICE SOYBEANS FEED GRAINS WHEAT COTT ON have been particularly dissatisfied SOURCES: U.S. Department of Agriculture with their programs that allow Federal Reserve Bank of Dallas farm surpluses to build up while prices continue to go higher. World farm trade to expand 60 percent by 1985 :: - -- ~ ~ ~ \r;~:; ~t~~ 8 ~ - t : ~ -~ I I -- I-~ I - ~ ~ l ,i ! I - - !- ~ I ~ ~ I- - ! - There has also been disenchantment in the United States. For American farmers to participate more fully in world markets, changes will be needed to give the forces of supply and demand freer rein in seeking international price levels. These changes will become increasingly important as American farmers try to compete in the expanding markets for soybeans, grains, and livestock. Benefits of more free trade could be substantial. With more liberal trade policies, U.S. agricultural exports could reach $25 billion by 1985. Although imports would also rise-though maybe only to about $12 billion-the net trade balance in farm products would still be $13 billion. That would be nearly twice again the balance to be expected with no liberalization of policies. Some of this increase would come from more sales of livestock products. Most of it, however, Would be due to greater crop shipments-especially feed grains and soybeans, the two crops in which the United States has a marked adVantage. A negotiating strategy for the Dnited States aimed at achieving market orientation in farm trade Would require that restrictions on farm imports be slowly removed as other countries were induced to ease their restrictions against U.S. products. For trade to become t:u~y market-oriented, export subSIdIes and price supports would also have to be removed-at home and abroad. Although a Government farm program might be helpful for several years in moderating shortterm depressions of farm prices ~h~n supplies became excessive urmg the changeover to a freer tnarket system, price supports C~U~d not be used indefinitely. RIgId price supports hinder resource adjustments-both in agriBUs'Iness Review I September 1973 culture and without-preventing the market orientation needed for farmers to participate more fully in the growth of world markets. Prospects for a tradeoff Net farm exports came close to equaling net fuel imports in 1970. But trends to be expected from the continuation of current policies would leave this near-balance badly upset in just a few years. Without major policy changesan indecisiveness that would allow net fuel imports to reach $34 billion by 1985 and prevent net farm exports from exceeding $7 billionthe balance could be tipped to a deficit of about $27 billion in only 12 years. On the basis of other trends in the nation's balance of payments, that would be a deficit that would not likely be made up from other trade sources. Modifications in policies could change the outlook significantly. With appropriate policies to stimulate domestic fuel production and encourage the development of other energy sources, the National Petroleum Council estimates that fuel imports projected for 1985 could be cut by more than t wothirds, holding foreign purchases to about $11 billion. And with a liberal trade policy supported by appropriate domestic agricultural production policies, net farm exports could be nearly doubled, pushed possibly to $13 billion. Under these most favorable circumstances, the United States likely could balance its increased farm shipments against the lower level of fuel imports. Whether this combination of conditions can be achieved, however, depends on policy considerations that are beyond ordinary economic determination. Given the world's persistent need for more food and this country's absolute advantage in farm Most growth in U.S . farm imports in competitive products BILLION DOLLARS 8 ' 75 SOURCE: U .S. Department of Agriculture 9 ... while farm trade surplus could reach $7 to $13 billion U.S. fuel imports could cost $11 to $34 billion in 1985 ... leaving the difference possibly as high as $27 billion BILLION DOLLARS 40---------------------------20 - NET EXPORTS ,"~""'"I -_---~_._ -40---------------------------'70 '85 '85 NO POTENTIAL MAJOR POLICY CHANGE '70 '85 NET DIFFERENCE ~ '85 NO POTENTIAL MAJOR POLICY CHANGE '70 '85 '85 NO POTENTIAL MAJOR POLICY CHANGE SOURCES: National Petroleum Council U.S. Department of Agriculture Federal Reserve Bank of Dallas production, it seems apparent that more liberal trade policies are to be expected. But also given the seemingly unyielding growth in domestic demand for energy and the continued environmental constraints on domestic production of energy, it seems unlikely that fuel imports can be held to anything like their minimum level. Efforts are being made, however, to encourage the search for more domestic oil and gas. And as the United States becomes more dependent on the Middle East for 10 oil, the incentive for expansion of domestic production will increase still further. On balance, then, it appears that while farm exports may not fully offset fuel imports, changes in farm and fuel policies are very apt to lead in that direction. The opportunity for closer balance is, at least, visible. New par bank The Kirby State Bank, San Antonio, Texas, an insured nonmember bank located in the territory served by the San Antonio Branch of the Federal Reserve Bank of Dallas, was added to the Par List on its opening date, August 13, 1973. The officers are: Lawrence W. Keller, Jr., President, and Alfred P. Berger, Jr., Vice President and Cashier. - nuSlness ' Review I September 1973 11 Federal Reserve Bank of Dallas September 1973 Statistical Supplement to the Business Review Total credit at weekly reporting banks in the Eleventh District increased slightly in the four weeks ended August 22. Heavy purchases of Government and other s~curities were financed mainly by sIzable inflows of deposits. Total loans fell sharply, primarily reflecting a substantial decline in business loan demand. Construction activity in the District Was brisk, however, and demand for real estate loans remained high, reflecting in part increased costs of labor and materials. ConSUmer loans at District banks were also strong, as borrowers apparently used bank credit to finance purchases of automobiles and other durable goods. With the decline in the overall ?emand for loans, banks used their Inflow of deposits to purchase securities. District banks added a ~ubstantial volume of Government Issues-mainly Treasury bills-to ~heir investment portfolios. Other In~reases in security holdings were prImarily in municipal issues. Total deposits expanded rapidly, ~s both demand and time and savW~s deposits increased markedly. Ith the sharp decline in loan detnand, however, banks were less aggressive in issuing large CD's and ?utstandings fell. District banks Increased their borrowing in the EUrodollar market. Bank-related C?mmercial paper remained relahvely unchanged. Department store sales in the ~.leventh District were 13 percent Igher in the four weeks ended August 25 than in the comparable rhriod last year. Cumulative sales rough that date were also 13 perCent greater than in the corresPonding period in 1972. Registrations of new passenger automobiles in Dallas, Fort Worth, Houston, and San Antonio declined 6 percent in July but were 8 percent higher than in July 1972. Cumulative registrations for the first seven months of 1973 were 17 percent greater than for the same period in 1972. Dallas had a yearto-year gain of 19 percent for the seven months, Fort Worth had 17 percent, Houston had 16 percent, and San Antonio had 10 percent. Seasonally adjusted total employment in the five southwestern states rose to a new high in July, following an upward revision in the number of people employed in June. Total employment was 3.4 percent higher than a year before. And with a slight increase in the labor force, the unemployment rate dropped from 4.0 percent to 3.8 percent in July. Nonagricultural employment was up 0.4 percent. Manufacturing production was essentially unchanged, as gains in the production of durable goods were offset by declines in nondurables. The advance in nonmanufacturing employment was paced by new hirings for construction and government jobs. All categories of industry were well above ther employment levels of a year earlier. The seasonally adjusted Texas industrial production index fell 0.8 percent in July but remained 6.0 percent higher than a year be.fore. All major components of the mdex except utilities contributed to the decline. A 2.1-percent reduction in nondurable goods production contributed significantly to an overall decline in manufacturing output. Petroleum refining, apparel, and printing and publishing showed the biggest cutbacks. Output of chemicals and allied products and paper products increased. Durable goods manufacturing edged down 0.1 percent. Transportation equipment and furniture and fixtures had the biggest decreases. However, electrical machinery, lumber and wood products, and primary metals showed increases. As a result of a small decline in crude oil production, mining activity was off 0.1 percent. Natural gas production was up slightly. Output of utilities rose, led by an increase in the distribution of gas. There was also a small increase in the distribution of electricity. A two-tier system of crude prices will be used under Phase IV. Designed to offer incentives for production over 1972 rates of output, the system will allow crude oil from new production to be sold at uncontrolled prices. And as a bonus, producers will be allowed to sell an amount of old crude at free market prices equal to the new crude developed since 1972. Crop prospects in states of the Eleventh District generally improved in August, as favorable growing conditions helped compensate for the late start this spring. Production of most crops was expected to surpass 1972 levels because of both increased acreages and projected near-record yields. As of August 1, winter wheat production was placed at over 280 million bushels, 88 percent higher than in 1972. The grain sorghum crop was estimated at more than (Continued on back page) CONDITION STATISTICS OF WEEKLY REPORTING COMMERCIAL BANKS Eleventh Federal Reserve District (Thousand dollars) ASSETS Aug.22, 1973 Jul y 25, 1973 Aug. 23, 1972 Federal fund s sold and securities purchased under agreements to rese ll .. . ... :-: .••.....•• Other loons and discounts, gross • ••.. .• .. •... ... 947,045 9,946,081 824,792 9,719,604 948,629 8,126,998 4,352,716 4,422,717 3,625,408 States and political subdivisions .... ... ..... U.S . Government . ... .. . . . . . . . . . . . . . . . . . . 280,006 265,105 188,709 821 44,925 822 43,322 1,165 93,235 Banks in the United States •. ........•...... Foreign: Governments, offlcial institutions, central banks, a nd international Institutions ••. . • . Commercial bonks ..... ..... .... ....... Certifled and offlc:ers' checks, etc . .. .. .. .. .. . 7,466 481,535 7,805 491,611 5,694 453,719 Commercial and industria l loons .. •.• •. ...•.. • Agricultural loans, excluding certiflcates of interest ••• ..••....•..•••. • .. loons to brok ers and dealers for purchasing or carrying : U.S. Government securities • • •. . .• .•• .••. .• . Other securities . .•.•.....••..•... •• • ••••. Other 1000$ for purchasing or carrying : U.S. Government securities .• • .•..••.••.•••• Other securities ..•• .. . .•.. .. ...• • ••...... loan s to nonbank flnancia l institutions! Sal es flnonce, personal flnance, factors, and other business cred it companies ... ... . ece Other •....... . • . .. .. .•..•.••...•..•.•. Real estate loons ... .•.............•....... loon s to dom estic commercial bonks • •...••.... loons to foreign bonks . .• . . .•..•.........•.. Consum e r instalment loon s...... ............ . loan s to foreign governments, ofncia l institutions, central bonks, and international institutions . .........• . ........•.•...... • Oth er loans .•.•• ...... •. . • •.•. .. ... . ...... Total investm ent s . •.....•.........•.......... Total U.S. Government securities .... . . ..••.... Treasury bills . •........ . ....•.•••.....•. Treasur y certiflcates of indebtedness . •••...• Trea sury notes and U.S. Government bond s maturing: Within I year .•. ..•..... .•.•...... •. • . I year to 5 years ..•. . ..•..•. .• . •.. . .. . After 5 years .... ......••..•..•.....•• Obligations of states and political subdivisions: Tax warrants and shor t-term notes and bills •.• Total deposits ... .... .. ... . ... ............... 13,333,464 153,813 646,904 1,371,310 28,053 63,572 1,058,758 171,374 613,621 1,3 58,093 30,053 60,768 1,038,005 129,968 661,439 1,083,357 16,365 32,538 907,874 520 1,155,682 3,940,221 552 1,215,756 3,860,880 0 927,527 3,605,184 9~8,7 42 207,595 0 919,985 133,954 0 993,212 158,934 0 Total rim e and sovings deposits ...... ......... 136,008 490,847 207,423 125,03 1 2,594,441 105,766 2,565,626 84,172 2,293,071 8,520 253,487 1,463,689 651,768 124,089 391,679 17,070 8,406 261,097 1,302,072 691,517 120,368 386,474 13,088 15,135 219,594 1,394,412 901,559 106,962 372,515 12,629 798,447 801,272 TOTAL ASSETS ... . .. .......... . ......... 17,980,089 17,720,067 Jul y 25, 1973 Aug. 23, 1972 13, I B9,212 12,299,829 - --- 6,649,087 4,813,100 405,462 70,912 1,209,546 6,581,554 4,675,285 445,402 146,629 1,155,362r 6,642,554 4,730,117 386,807 81,800 1,312,871 3,362 52,846 93,859 6,684,377 3,673 54,053r 101,1 50 6,607,658 2,789 36,838 91,332 5,657,275 1,146,924 3,602,304 1,803,200 23,267 83,862 1,159,957 3,579,515 1,743,657 31,304 80,505 1,154,668 2,937,792 1,429,924 26,881 93,010 24,800 20 12,600 120 13,900 1,100 2,472,358 202,649 560,895 166,161 13,982 1,230,580 2,380,640 228,794 527,217 163,919 13,819 1,216,466 1,979,174 51,935 450,516 139,763 18,184 1,132,033 17,720,067 16,07 1,414: Ind ividuals, partnerships, and corporations: States and political subdivisions • ..•.... . ... U.S. Governm ent {including postal savings) • • . . Banks in the United States . ..•. ... .••..••.. Foreign: Governments, ofnciaf institutions, central banks, and international institutions ••. ... Commercial banks •. • . . • ...•...••...... Federal funds purchased and securities so ld under agreements to repurchase •• . ...... ..... Other liabilities for borrowed money . •• . •...•.•• Other liabilities .•••. ....•...•..•••..•....•... Reserves on loan s•... . .•..• ...•.•..•..•... . . • Reserves on securities •• ••.... . • ... .•.•.•....•. Total capital accounts •..• .•..•..•..•..••.•..• - - - - TOTAL LIABILITIES, RESERVES, AND CAPITAL ACCOUNTS ..... .. .. .... ...... 17,980,089 153,920 467,258 164,853 All other . .................•........•... Total demand deposits .. •. ..... ............. Individual s, partnerships, and cor porations • . . • SaYings deposits .... .. . . ...... . ........ Other time deposits . ... ..... .......... . 137,788 446,637 166,722 Other bond s, corporate stocks, and securities: Certiflcat es representing participations in federal agency loons •.•. • .........•• ..• All other (including corporate stocks) .... .... . Co sh items in proc ess of collection . • .. . .......•.. Reserves with Federal Reserve Bank .. •..•... . ... Currency and coin ... ... . ...........•.•.. •. •• Balances with bonks in the United States • •....•. • Balances with banks in foreign countries . • .. •..•. • Other assets (including investments in subsidiaries not consolidated) • ....•..••.....•.•. .• ...•• Aug. 22, 1973 LIABILITIES --- - r- Re vlsed DEMAND AND TIME DEPOSITS OF MEMBER BANKS Eleventh Federal Reserve District - (Ave rages 01 dally ligures. Million dollars) 602,546 - - - -- DEMAND DEPOSITS 16,071,434 TIME DEPOSITS U.S . Date Totol Adjusted' Government Total 1971, July .•••••• 1972, July .••••.. August •••.. 11,507 12,529 12,420 12,619 12,866 12,844 13,439 13,636 13,270 13,203 13,237 13,136 13,218 13,25 9 7,955 8,694 8,824 8,933 9,034 9,321 9,688 9,802 9,516 9,454 9,550 9,502 9,551 9,567 256 289 226 254 264 222 289 317 379 395 331 341 279 261 9,588 11,304 11,441 11,492 11,618 12,009 12,261 12,501 12,811 13,038 13,249 13,336 13,374 13,396 September. October ••• November •• December • • CONDITION STATISTICS OF ALL MEMBER BANKS 1973, January .•• Eleventh Federal Reserve District February ••• March •• •• • April . •.•.• May ..•••. (Million dollars) June • ••..• Item Jul y 25, 1973 27, 1973 June July 26, 1972 TOTAL ASSETS- ••• . .• • .• •• •••.. .•• • •• 18,691 2,266 5,906 1,369 342 1,221 15 1,558 1,481 18,976 2,283 5,932 1,239 345 1,289 18 1,605 1,519 15,719 2,287 5,225 1,507 309 1,242 13 1,655 1,118 RESERVE POSITIONS OF MEMBER BANKS Eleventh Federal Reserve District 32,849 33,206 29,075 Demand deposits of bonks • •..•.•••••••.• Other demand deposits • •..••.•..•• •• ..•• Time deposits .•.. •..•.•••...•••••..•.•• 1,586 11,248 13,413 1,613 11,519 13,394 1,739 10,657 11,383 Total deposits ••. .. . ••.•.•••..•...••.• Borrowings ••. ......•••..••••.••••••.•• Other liobilities e ••••. .•..•..••.•..••.•.• Total capitol accounts e • •.••.••••••.••..• 26,247 3,041 1,243 2,318 26,526 3,126 1,258 2,296 23,779 1,929 1,402 1,965 LIABIlITIES AND CAPITAL ACCOUNTS TOTAL LIABILITIES AND CAPITAL ACCOUNTSe •.•.....•..•.• •. .... • . e-Estlmated 2,434 2,714 2,717 2,744 2,770 2,786 2,812 2,815 2,817 2,848 2,855 2,859 2,884 2,868 - 1. Other than those 01 U.S. Government and domestic commercial banks, leSS cash ite ms In process of collection ASSETS loans and discounts, gross • •• . ••••.•• • ••.• U.S. Government obligations ... ••••.•••••• Other securities ••••• .•.•.••.•.•.•••.•••• Reserves with federal Reserve Bank ... ••..• Cosh in vault •••. ..•.•..•.•...•.....•..• Balances with bonks in the United States . •.. Balances with bonks in foreign countries e • •. . Cash items in process of collection •••• •• .••• Other assets e • . ••..•.•.••.•....•••• • •.• Jul y •...•.• Savin gs__ (Ave rag es of daily figures. Thousand dollars) - Item Aug. I, 1973 .4 w eeks ended July 4, 1973 .4 weeks ended Aug. 2, ~ Total reserves held •••....•.••••.. With Federal Re serve Bonk •• ...• Currency and coin . ••..•...•... Required reserves • .•• .. • .•.... .•. Excess reserves •• •...••.••.••...• Borrowings • .•.••. . . ••••....... • Free reserves • ••..••••.••....•.• 1,818,526 1,513,643 304,883 1,804,716 13,810 131,982 -118,172 1,758,533 1,461,612 296,921 1,770,282 -11,749 93,590 - 105,339 1,896,013 1,620,152 275,861 1 877,45 1 , 18,562 2,952 15,610 4 weeks ended --------------------------------------------------------- BANK DEBITS, END-OF-MONTH DEPOSITS, AND DEPOSIT TURNOVER SMSA's in Eleventh Federal Reserve District (Doll a r amounts In thous ands, seasonally adjusted) DE81TS TO DEMAND DEPOSIT ACCOUNTS' DEMAND DEPOSITS' Percent change July 1973 Standard metropolitan statistical are a ARIZONA, Tucson ............. . .... . .. .. ............ LOUIS IANA Monroe . .......•... . •. •..... • . .. .•...... NEW MEXICO, Roswell ' •..•.... . •.. ..... ...•..•.. • •.. TEXAS, Abilene •.........................•. • .. .. .... Amarillo ...... . . ... ....... .. ....... ........ . Austin ... . ........... . . . ........•........... Boa umonl- Port Arthur-Orang e .. .. .. ......•.•.... Brownsville-Harlingen _Son Benito •.• .. .......• ... . Bryon. College Station ......... . .•....•. . ...... 2~;~~~n~~r.is.ti: ::::::::::::::::::::::::::::::: ~o~~:~.' : : : : : : : : : : : : : : : : : : : : : : : : .' : .' : .' : : : : : : : Fort Worth ... . ... . .. . ....... ... ...... ... . .. . Golveston· Texas Cit y •..... . ... . ..... .......... Houston .•. ............. . ............• , ..••.. Killeen-Temple . . .. .................•...•..... laredo •........... ... ....... . ............. . Lubbock . . . . . .. ... . . ......•..•.•...•.•....•• McAllen· Pharr-Edinburg .... ..•.•............... Midland . .. .. ............. . •... . .•.....•..• . Odessa •........•.............•...•... . ....• Son Angelo • .•. ....... . ... .• ... ... ..... .•.. •. Son Antonio ... . .....•. .• . .. ... . . . ... . ...• •.. Sherman· Den ison • . . ......... .. ..•• •... .• . ..• . Texark ana (Tcxas·Ark ansas) .. .............•.... Tyler ....................................... Waco ...•..........•..•.•...•.•••...•••.... Wichita Falls.••...•••.•.•.•.••..•••..••...... Total_30 centers .......••.•.....••...••..••..•••... 7 months, (Annual-rate June basis) 1973 $13,3 14,755 4,725,445 16,28 1,994 1,154,353 3,196,366 9,705,433 15,510,914 8,518,771 2,987,137 1,451,844 8,919,829 625,291 209,585,106 11,555,264 30,700,954 3,655,658 168,660,442 2,540,354 1,479,102 7,899,330 3,466,271 2,671,099 2,197,268 1,952,033 26,466,570 1,546,270 1,946,725 3,073,831 4,652,518 3,553,294 Shreveport . . .. .. .. .. ..•... . ...• ... ...•.• ----- Annual rate of turnover July 1973 from 6% 0 -3 -10 -I -12 9 5 -13 -4 7 -7 1 -2 -5 8 4 0 -1 -2 1 -1 -14 -20 -4 4 -7 1 5 -I $573,994,221 1% Jul y 1972 1973 from 1972 July 31, 1973 July 1973 1973 July 1972 41% 25 36 25 25 29 26 25 27 10 21 21 43 19 6 26 23 29 25 46 48 27 14 14 23 27 10 10 21 21 33% 22 20 15 20 27 13 16 23 14 14 25 24 18 10 17 20 27 24 36 32 15 18 22 19 14 12 16 17 15 $339,129 115,784 334,146 50,842 148,714 221,154 452,872 283,393 117,982 58,230 290,388 42,326 2,945,638 322,950 848,859 132,713 3,366,302 118,633 58,908 234,472 178,974 158,472 104,506 83,840 911,244 87,101 93,488 133,000 158,432 155,701 38.5 40.6 50.2 22.7 22.0 43.4 31.8 30.2 25.0 24.9 31.0 15.0 70.8 36.1 36 .3 28.2 50.4 21.1 25.2 34.6 19.7 16.8 21.4 22.2 29.3 17.7 21.2 23.1 29.7 23.1 36.8 40.0 52.9 25.8 22.6 48.1 27.7 28.3 27.6 25.9 29.0 16.0 68.2 36.5 37.9 26.0 48 .0 20.9 24 .6 36.0 19.4 16.7 25.4 26.5 30.3 16.9 23.3 23.5 28.1 23.7 30.0 34.7 39.8 21.2 20.7 39.6 26.6 25.2 24.0 24.5 27.6 14.4 53.8 31.4 36.5 23.7 43.8 18.7 23.7 28.6 17.1 14.0 18.2 22.0 25.9 16.2 20.3 23 .6 26.1 22.1 29% 21% 45.7 44 .8 38.3 $12,548,193 Jun e 1. Deposits of individuals, partnerships, and corporations and of states and political subdivisions 2. County basis CO NDITION OF THE FEDERAL RESERVE BANK OF DALLAS - BUILDING PERMITS (Thousand dollars) 1973 July 25, 1973 August 23, Item [ota l gold certincote reserves •....•..••.•... Cans to member bonks .................•.• F ther loons . . • . . . . . . . . . . . . ....•.•......• Ue~ o ral ag enc y obligations •.....••... .....• T' . Government sec uriti es .•......•.. . ... .. . tal earnjn g ass ets •.. . ...............•••• F ember bank r ese rve deposits ...... . ... .. .. ederal Reserve notes in actual circulation . ...• 196,193 72,375 0 71,676 3,303,148 3,447,199 1,274,045 2,357,258 256,671 112,2 40 0 71,114 3,297,5 89 3,480,943 1,369,458 2,346,443 330,313 7,010 0 53,355 3,187,354 3,2 47,719 1,569,344 2,169,330 August 22, M - VALUATION (Dollar amounts in thou,onds) 1972 Percen t change July 1973 Area ARIZONA Tucson •••....• Monroe· West Monroe •••.• Shreveport .•.• l OTAL OIL WELLS DRILLED ..... Are a FOSUR SOUTHWESTERN LTATES ..... . ...... . .. . • aulslona .. . . . ... . .. .. .. . Offshore .. . ........•.• N On shore ..•. . . .. • . . . . . ew Mexico .. ... . .•. . ... o T klohomo .... . ... . • ..... exas . . . . . . . . . . . . . . . . . . -- Offshore . . . ... . ....... lJ July 1973 7 mos. 1973 -----July June 1973 1972 7 months, 1973 from 1972 1973 1973 488 3,789 $9,340 $109,665 80 458 592 3,131 3,762 6,756 19,045 52,183 74 144 374 71 10 46 60 166 453 188 103 204 1,262 22 457 344 49 2,312 34 111 83 109 67 83 1,871 39 48 209 75 528 1,147 3,501 1,349 693 2,095 9,680 199 3,722 2,665 382 18,694 322 1,140 606 765 741 566 12,758 273 362 1,433 520 1, 196 2,159 27,222 1,825 1,764 4,691 27,864 126 11,027 7,895 314 41 ,514 1,538 1,8 27 728 670 174 1,072 23,270 407 662 3,154 1,437 18,355 33,957 151,757 19,601 17,016 35,304 198,750 1,849 103,22 1 72,888 6,379 432,536 13,546 45,853 9,926 9,851 4,161 6,410 145,026 3,793 3,034 23,419 12,762 -52 -76 75 -63 68 -33 -50 55 7 15 -2 55 - 13 - 19 -25 35 - 36 530 -55 10 -46 - 75 14 78 -24 74 -27 42 71 91 2 13 100 -10 -2 6 -6 -9 48 -17 10 40 37 - 14 -46 8 33 10 -2 1 -40 6 48 9,375 71,653 -45%-47% -11% LOUIS IANA TEXAS --- from NUM8ER ------7 mos. July Onshore •......•. . ... . NITED STATES .. .. ........ Second quart er First quart er 1973 1973 1,426 188 49 139 61 22 1 956 2 954 2,219 1,403 243 95 148 92 196 872 2 870 2,474 SO URCE : Am e rican Pe trol e um Institute Percent change Percent change 1.6% -22.6 -48 .4 -6.1 -33.7 12.8 9.6 9.7 - 10.3% 1973 from 1972 cumulative cumulative 2,829 431 144 287 153 417 1,828 4 1,824 4,693 -19.1% - 10.6 26.3 -22 .0 -42.7 -22 .8 - 17.3 - 17.4 -20.0% Abilen e •..••.. Amarillo ..... . Austin .•...• . • Be aumont .• , .. Brown sville •.. • Corpus Christi. . Dallas .....•.. Denison ...••. . EI Pa so ...... · Fort Worth .... Galves ton ..... Houston .•.. . .. larodo . . • . · · . Lubbock . .. •.. Midland ...•.. Od essa ...•... Por t Arthur .... Son Ang elo ..•. San Antonio ..• Sh erman . ..... Tex arkana . . .. Waco . .. .. · · . W ichita Foils ..• TOlal - 26 cities .• • -------$182,394 $ 1,550,487 11~ 7 -54 -39 - 4 - 8 -29 120 - 62 -57 - 75 -2 8 98 16 62 47 17 68 -10% - 3% 3% DAILY AVERAGE PRODUCTION OF CRUDE OIL LABOR FORCE, EMPLOYMENT, AND UNEMPLOYMENT (Thousand barrels) Five Southwestern States l Percent change from Areo FOUR SOUTHWESTERN STATES . ......... . ... .. . louisiona .•. ...•• .• .. . •.• N ew Me xico •...•• • .. . • . . Oklahomo •. •. . ..• ...•• . . Texa s .. . . . . .•. • .....•.• Gulf Coa st . • . . ... .. . • . W es t Texas . . ••.. . .. • . East Te xa s (prop er) . •• • • Panhandle .••• • . .... .• . Rest of state . .. ••...... UNITED STATES . .......... . July 1973 1973 July 1972r 6,760 .2 2,281.8 269:0 521.0 3,688.4 739.7 1,870.1 254.2 62.4 763.0 9,346.0 6,781.6 2,319.9 273 .8 523.1 3,664 .8 729.9 1,856.9 252.1 66 .3 759.6 9,366.6 7,150 .5 2,546.6 309.8 567.5 3,726.6 771.3 1,798.1 258.8 73 .0 825.4 9,727.0 June Jun e 1973 -0 .3% - 1.6 - 1.8 - .4 .6 1.2 .7 .8 -5 .9 .4 - .2% (Seasonally adjusted) July 1972 -5.5% - 10.4 - 13.2 -8 .2 -1.0 - 4.2 4.0 -1.8 - 14.5 -7.6 - 3.9% r- Re vised SOURCES : American Petroleum Institute U.S. Bureau of Min e s Federal Reserve Bank of Dallas Percent change July 1973 from Thousands of persons Item Civilian 10 bor force . .. . . . • .• Totol emplo yment .... .. ..... Total unemployment ... . • .... Unemploymen t rate •• .•. . . . • Total nonagricultura l wage and salary employment. ... Manufacturing . ..•... .• .• Durable .• • . ........... Nondurable • . . . . . . . • .. Nonmanufacturing . •• •. ... Mining ..•....... . .... . Construction • • . .. . .•.. . Tran sportation and p ublic utilities • ....... Trade • . .. . ... . . . .•.• • Finance . . .. •. . . . . .• . . • Service • • . ........•• •• Government . • . ... . • • .• July 1973p 1973 July 1972 r 8,901.3 8,562 .8 338.5 3.8% 8,881.3 8,525.0 356.2 4.0% 8,666.6 8,283.3 383 .3 4.4% 7,064 .8 1,231.6 689.2 542 .4 5,833.2 233 .0 486.5 7,034.9 1,231.0 687.5 543.5 5,903.9 232.4 48 1.4 6,773.2 1, 176.2 642.6 533 .6 5,597.0 230.5 45 1.4 477.7 1,691.7 384.5 1,153 .0 1,406.9 476.8 1,695 .9 383.0 1,151.5 1,393.0 464.0 1,62 1.5 360 .9 1,107.9 1,360.8 June July 1972 June 1973 0.2% 2.7% 3.4 .4 -5.0 -11.7 ' _.6 ' _.2 4.3 4.7 7.3 1.6 4.2 1.1 7.8 .4 .0 .2 -.2 .5 .3 1.1 .2 .3 .4 .1 1.0% 3.0 4.3 6.S 4.1 3.4% 1. Arizona , Louisiana, New Mexico, Oklahoma, and Texas 2. Actual change p-Preliminary r- Revlse d NOTE : Details may not add to totals because of rounding . SOURCES : State employment agencies Federal Reserve Bank of Dallas (seasonal adjustment) CROP PRODUCTION (Thousand bu s hels) FIVE SOUTHWESTERN STATES' TEXAS Crop 1973, 1973, estimated estimated Aug. I 4,532 Corn • . . • . • . • .. . 60,900 Winter wheat .... 99,600 Oats ... . .. . .... 26,650 Borley .•.. • .. • . . 3,510 Rye . ...... • ..•. 648 Rice". ...... . . . . 23,693 Sorghum groin ..• 414,800 Flaxseed ... ..... 80 Hay 4 ••• • • •• ••• • 4,464 Peanuts s . . . . . . .. 502,400 Irish poto'oes l , ... 2,991 Sweet patatoes 3 •• 760 Cotton' . . ...... . 1972 1971 Aug. 1 1972 1971 4,277 39.560 44,000 9,720 1,990 630 22,122 319,780 165 4,109 480,455 3,182 813 2,614 44,I60r 31,416 5,994 1,320 378 23,868r 303,004 70 4,114 366,795 3,299 788 6,177 73,493 291,721 35,099 21,196 2,046 47,367 481,448 80 10,887 766,340 6,317 3,910 6,140 52,795 150, 115 16,149 19,334 1,890 42,099 378,218 165 9,944 743,566 6,665 4,113 4,053 55,241 r 119,925r 12,OOIr 26,300r 1,158 43,704r 366,400r 70 10,303r 602,315 6,810 3,763 r-Revise d 1. Arizona, Louisiana, New Mexico, Oklahoma, and Texas 2. Thousand bales 3 . Thousand hundredweight 4. Thousand tons 5. Thousa nd pounds SOURCE : U.S. Department of Agriculture 480 million bushels-up a fourth from 1972 and nearly a third larger than in 1971. The cotton crop in Texas was projected at 4.5 million bales, only moderately higher than in 1972 but three-fourths larger than in 1971. The Texas soybean crop was expected to more than double its 1972 output, offsetting a slight decline in Louisiana. Cattle on feed in Texas on August 1 numbered 2.3 million head, up 9 percent from a year earlier. And, in Arizona there were 548 thousand head on feed, slightly more than the year before. Cattle INDUSTRIAL PRODUCTION' (Seasonally adjusted Indexes, 1967 Area a nd type of index = 100) July 1973p June 1973 May 1973 July 1972 138.5 142.5 157.0 132.1 123 .4 158.6 139.6 144 .2 157. 1 134.9 123.6 158.1 135.9r 140.6r 156.1 129.3r 118.7r 158.1r 130.6 131.8 142 .3 124.2 120.6 126 .3 126.6 123.9 130.4 110.6 149.0 125.4 125.2 122.5 129.3 109.3 148.8 124.8r 124.9r 121.7r 129.9r 108 .8r 149.5r TEXAS Totol industria l production .•...• Manufacturing .••.....••.. ••.• . Durable •.. . ••...• • ..•.•• • .•• Nondurable . . ......... . ...... Mining ...... . ........ . ...... . . Utilities ••... • •...•... • •.•..• . • UNITED STATES Total industria l production .•.... Manufacturing •••. • . • . .• . ... . • . Durable . . . .... . ............. Nondurable . . .... . . . ... . .. .. . Mining .••..••...•..•...•..•.. • U tilities .•.....•... • ....•...•. • - 158.S 115.1r 11 4.3r 108.8r 122 .Sr 108 .6r 143.3r p - Preliminary r - Revised SOURCES: Board of Governors of the Federal Reserve System Federal Reserve Bank of Dallas placed on feed continued to lag, but even with the decrease in placements, active feedlots in Texas reported an above-average rate of occupancy. The rise in cattle on feed despite a decline in placements reflected the uncertainties of recent economic controls and the resulting cost-price squeeze in the livestock industry. The index of prices received' by Texas farmers and ranchers increased markedly in the month ended August 15 to a level substantially higher than a year earlier. Crops and livestock contrib- uted about equally to both the month-to-month and year-to-year gains. Higher farm prices boosted cash receipts from farm marketings in the five District states to $4.2 billion for the first six months of this year-26 percent higher than for the same period in 1972. Crop receipts increased by 50 percent to nearly $1.3 billion, while livestock receipts moved up 18 percent to just over $2.9 billion. I I I I I I 1