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MONTHLY REVIEW Of Agricultural, Industrial, Trade and Financial Conditions in the Eighth Federal Reserve District Released for Publication On and After the Morning of August 30,1935 JOHN S. W O O D , Chairman and Federal Reserve Agent FEDERAL WORKING CAPITAL LOANS Supplemental information regarding loans and commitments under Section 13b of the Federal Reserve Act, which authorizes the Reserve banks to aid in providing working capital for established industrial or commer cial businesses for periods of not exceeding five years: Application Procedure The following excerpts from recent article by W. K. Norris, Chairman, Industrial Advisory Com mittee of the Eighth Federal Reserve District, ex plains briefly the procedure of applying for accommo dations under Section 13b: “ Now as to how to go about it! First go to your own banker and see whether he will give you the accommodation you need. His reason for not lending to you might be unwillingness to tie up his funds for as long a time as you need them, or he may not have sufficient funds available. Then ask him if he would be willing to participate with the Federal Reserve Bank of the district in making a 13b loan. If he does not know all about it, ask him to inquire of the Fed eral Reserve Bank. The participation arrangements are very flexible. The Reserve bank will make a com mitment to take over any part or all of an approved loan from the participating bank on demand, and besides thus furnishing liquidity, it will assume an agreed percentage of any loss not exceeding 80%. It is really good business for the participating bank. “ But if the bank turns down your request, then make your application direct in person or by mail, to the Federal Reserve Bank of your district. Explain your needs fully and frankly. If you seem to be an eligible borrower, if what you want can be construed as working capital, if your past record is good, if there is a reasonable chance of your making money in the future with the help of this loan and of repaying the advance within a reasonable time, and within the limit of five years, then you will make out a regular appli cation form. “ After all necessary information is secured, the case will be referred first to the Industrial Advisory Committee of business men. Under Section 13b such a committee of active business men, otherwise uncon nected with the Federal Reserve Banks, must pass on all loan applications. Each borrower is thus deal ing in the first instance, with fellow business men who consider his problems from the business man’s stand point. After this committee, the Reserve bank’s Dis count Committee and officers pass final judgment. “ There is very little -red tape and everything is settled in the Reserve bank, with no reference to Washington. Procedure differs somewhat in the differ ent Reserve banks, but, generally speaking, the entire process need not take more than, say, four weeks. Every case, no matter how small or how unusual, is given thorough and sympathetic consideration. Due attention is given to the element of moral risk and to the effect of the loan in promoting employment.” Rates The rates of the Federal Reserve Bank of St. Louis on industrial loans and commitments, as well as the volume of such accommodations outstanding, are given on page 7 of this Review. C. M. STEW ART, Secretary and Ass*t Federal Reserve Agent RESERVE BANK OF ST. J. V IO N PA PIN , Statistician LOUIS HE same general trends in Eighth District commercial and industrial activity noted during the similar period immediately pre ceding continued during July and the first half of August. While recessions were noted in certain directions, they were accounted for mainly by the usual seasonal influences. Elsewhere the slowing down which ordinarily takes place in midsummer was little in evidence or entirely absent and distinct improvement was recorded. Production and distri bution of commodities, with the exception of a lim ited number of classifications, exceeded the vol umes of the like period a year ago. More seasonable weather materially assisted the movement of mer chandise through retail channels, and clearance of summer goods was much more thorough than was thought possible a month or six weeks earlier. In some instances wholesalers and jobbers reported a fair volume of reordering of goods in this category. While advance ordering in a majority of lines is still behind the volume a year ago, ordering for fall and winter distribution since the middle of July has been on a larger scale than earlier in the season. The July volume of all wholesaling and jobbing interests reporting to this bank was in excess of that of the preceding month this year and of July, 1934. Durable goods, including iron and steel, lumber and the general run of building materials, made an exceptionally good showing for this time of year. In the case of certain specialty manufacturers, nota bly farm implements, stoves and ranges, household appliances and certain classes of machinery, the rate of operations was well sustained and higher than during any like period since 1930. There was a sea sonal curtailment in operations of electrical supply makers, but their volume for the first seven months this year was the largest for any like interval during the past four years. Production of bituminous coal in fields of the district declined from June to July and was measurably smaller than in July, 1934. Distribution of automobiles in July exceeded the totals of a month and a year earlier by a consider able margin. Industrial consumption of electric cur T Page 1 rent in the principal cities increased 2.4 per cent over June but was slightly below a year ago. Weather conditions during July and the first half of August were in the main auspicious for crops and agricultural activities of all descriptions. Yields of most of the important crops, according to the U. S. Department of Agriculture, will be above a year ago and compare favorably with the average of recent seasons. The harvest of winter wheat pro gressed rapidly. Early threshing returns, however, are disclosing considerable grain of inferior quality, and there are scattered reports of disappointing yields. Corn prospects in this district improved to the extent of about 25,000,000 bushels during July. Cotton made good growth and picking began in the lower tier of counties. Prices of farm products were well sustained and averaged well above levels prevailing at the corresponding period a year ago. Eighth District retail trade, as reflected in sales of department stores in the principal cities during July, showed an increase of 16.5 per cent as com pared with the same month in 1934, but the total was 19.9 per cent smaller than in June this year; cumulative total for the first seven months this year was 0.6 per cent greater than for the same period in 1934. Combined sales of all wholesaling and jobbing firms reporting to this bank in July were 21.5 per cent and 10 per cent greater, respectively, than a month and a year earlier; for the first seven months the total decreased 0.7 per cent under that of the like period in 1934. The value of contracts issued for new buildings in the five largest cities in July was 21.9 per cent and 129.5 per cent greater, respec tively, than a month and a year earlier; for the first seven months the total was 69.4 per cent larger than for the same time a year ago. Construction contracts let in the Eighth District during July were 1.5 per cent less than in the preceding month and 0.2 per cent larger than in July, 1934; the cumulative total for the first seven months was 15.2 per cent less than for the same period in 1934. Debits to individ ual accounts in July decreased 10 per cent from June, but the July total exceeded that of the same month in 1934 by 15.7 per cent; for the first seven months the cumulative total exceeded that of the same period a year ago by 10.7 per cent. Freight traffic of railroads operating in this dis trict, according to officials of the reporting lines, fell below that of the preceding thirty days and the volume was somewhat below that of the corre sponding periods a year and two years earlier. De creases as compared with last year were most marked in the live stock, grain and grain products classification. For the country as a whole loadings of Page 2 revenue freight for the first 32 weeks this year, or to August 10 totaled 18,585,620 cars, against 19,004,226 cars for the same time in 1934 and 17,092,915 cars in 1933. The St. Louis Terminal Railway As sociation, which handles interchanges for 28 con necting lines, interchanged 73,097 loads in July, against 77,999 loads in June and 72,704 loads in July, 1934. During the first nine days of August the inter change amounted to 22,020 loads, which compares with 19,918 loads during the like interval in July and 22,077 loads during the first nine days of August, 1934. Passenger traffic of the reporting roads decreased 5.5 per cent in July as contrasted with the same month a year ago. Estimated tonnage handled by the Federal Barge Line between St. Louis and New Orleans in July was 141,800 tons, against 132,582 tons in June and 108,902 tons in July, 1934. Reports relative to collections generally reflect the high degree of efficiency which has obtained in recent months. Relatively payments to wholesalers made a more favorable showing than was the case with the retail trade. This was accounted for partly by the absence of numerous customers on vacations, and in the rural areas to preoccupation of farmers with harvest. The winter wheat harvest is pro gressing rapidly, and the movement to market has been in large volume, resulting in considerable liquidation with both merchants and banks in sec tions where wheat is the main cash crop. Question naires addressed to representative interests in the several lines scattered through the district showed the following results: Excellent July, 1935................... 2.3% June, 1935................... 4.3 July, 1934................... 2.4 Good Fair Poor 50.7% 40.0 30.2 40.0% 51.9 55.4 7.0% 3.8 12.0 Commercial failures in the Eighth Federal Re serve District, according to Dun and Bradstreet, numbered 29, involving liabilities of $303,932, against 29 defaults in June with liabilities of $224,216 and 18 insolvencies for a total of $148,738 in July, 1934. MANUFACTURING AND WHOLESALING N E T S A L E S C O M P A R IS O N C O M M O D IT Y July, 1935 com pared to July ’ 34 June ’ 35 Boots and Shoes.......... + 24.1% + 42.2% D rugs and Chemicals.. + 3.1 — 3.1 — 15.5 + 19.7 — 12.7 E lectrical Supplies...... + 12.3 + 4 7 .2 — 4.6 + 4.7 + 11.5 + 11.0 + 12.2 + 10.0 + 2 1 .5 7 months ending July 31, 1935 com p, to 1934 + 3.0% — 4.1 — 15.1 + 15.8 + 2 6 .8 + 6.2 + 5.8 — 0.7 STOCKS ON H A N D July 31, 1935 com pared to July 31, 1934 + 10.3% + 76.4 — 9.5 + 10.7 — 5.7 — 0.6 + 12.7 + 5.7 Boots and Shoes — The increase in sales from June to July was seasonal and of about the average size. In both the month-to-month and the yearly comparisons increases were general through all lines of footwear, but most marked in women's and children’s shoes. Orders booked since August 1 indicate a volume slightly in excess of the corre sponding period last year. Prices advanced slightly between June 1 and July 1, and on the latest date were from 3 to 5 per cent higher than a year ago. Clothing — Belated purchasing of apparel for late fall and winter distribution picked up markedly in July, sales of the reporting firms showing an increase of 47.5 per cent over June. The July total, however, was 4 per cent smaller than a year ago. The spell of hot weather stimulated the movement of lightweight apparel, and some reordering was reported. Inventories increased 36 per cent between July 1 and August 1, and on the latest date were 8 per cent smaller than a year ago. Drugs and Chemicals — The movement of sea sonal merchandise of all descriptions was reported active throughout July and the first half of August. The small contraseasonal decrease from June to July in sales of the reporting firms was ascribed to smaller advance orders. Sales of fertilizers, insec ticides and kindred lines so far this season were reported the largest since 1930. Dry Goods — The decrease of 15.5 per cent in July sales of the reporting interests under the same month last year is accounted for entirely by smaller volume of advance business booked. Uncertainty relative to the cotton processing tax and the out come of the cotton crop tended to restrict purchas ing of fabrics based on that staple. Electrical Supplies — As has been the case dur ing each preceding month this year, July sales of the reporting firms showed a substantial increase over the corresponding month a year ago. The de crease from June to July shown in the above table was considerably smaller than average. Improve ment during the year has been spread over a wide field, but was most outstanding in household appli ances and building installations. Flour — Production at the twelve leading mills of the district in July totaled 172,581 barrels, against 169,519 barrels in June and 205,240 barrels in July, 1934. Business continued quiet during July and early August, buyers being disposed to await arrival of the new wheat crop before making extensive com mitments. Prices advanced slightly, following the upturn in cash wheat. Mill operations were at from 45 to 48 per cent of capacity. Furniture — While showing a slight decline in sales from June to July, business in this classifica tion, according to the reporting firms, continued active. Further expansion in household furniture and furnishings was noted. In point of volume of sales and prices, the July furniture markets at Chi cago and Grand Rapids were the best in a number of years. Groceries — Improvement in July sales over both the preceding month and a year ago was attributed in large part to favorable crop prospects and increased purchasing power in the rural areas. Advance ordering of canned goods was reported in somewhat larger volume than at this time a year ago. The trend of prices was upward, with the aver age measurably higher than a year ago. Hardware — Demand for goods for consump tion in the agricultural sections continued active and further expansion was noted in requirements of the building industry. The movement of cans, jars and other preserving equipment was reported in larger volume than during the preceding three or four years. Inventories declined further, and on August 1 were 2.2 per cent and 12.7 per cent smaller, respectively, than a month and a year earlier. Iron and Steel Products — Activities in the iron and steel industry in this district during July devel oped much less than the usual seasonal contraction, and during the first half of August the pace set dur ing the preceding month was well sustained, with moderate expansion in certain lines. The better ment was mainly in the form of heavier shipments and freer specifications on commodities previously acquired. As was the case earlier in the year, rela tively the heaviest rate of operations was at plants producing specialties, notably farm implements, stoves and ranges, machinery and household appli ances. Progress of the harvesting season has devel oped increasing need for new equipment, farmers in numerous instances finding it impossible to use their old machinery. Jobbing foundries report busi ness spotty, those making castings for specific in dustries having heavy orders, while plants depend ing on miscellaneous work are less busy than here tofore. Automotive requirements continued in sub stantial volume, and steel plants specializing in railroad work have received some business. The outlet through the building industry shows further moderate expansion, and is measurably bro*ader than at the corresponding period during the three preceding years. Reflecting this activity and heavier rural demands, the movement of sheets, galvanized roofing standard structural shapes, nails and other construction items is reported in considerable vol ume. July shipments of pig iron to melters in the district slightly exceeded the June total and repre Page 3 sented the largest aggregate for the month since 1930. The movement of tin plate was well sustained, with producers and distributors reporting a fair volume of reordering from the canning industries. Bookings by the warehouse and jobbing interests during the first half of August, contrary to the sea sonal precedent, exceeded those of the same period in July. Warehouse prices in the district were steady and unchanged. Scrap iron and steel prices advanced during late July and early in August, owing more to light offerings and sympathy with strength in the eastern markets than to increased consumer demand. For the country as a whole, production of pig iron in July, according to the magazine “ Steel” , was 1,520,016 tons, against 1,558,463 tons in June and 1,228,544 tons in July, 1934. Steel ingot production in the United States in July amounted to 2,270,224 tons, which compares with 2,230,893 tons in June and 1,489,453 tons in July a year ago. RETAIL TRADE The condition of retail trade is reflected in the following comparative statements showing activi ties in the leading cities of the district: Department Stores Stocks N et Sales Comparison on H and 7 m o. ended July, 1935 July 3 1 /3 5 July 3 1 /3 5 com pared to to same com p, to July 1934 J.une 1935 period *34 July 3 1 /3 4 El Dorado, A rk ..........+ 14.5% — 11.5% + 5.8% + 4.8% — 20.4 — 15.8 — 23.8 Evansville, In d .......... + 2.8 F ort Smith, A rk ........+ 2 0 .5 — 16.6 + 2.8 + 0.4 L ittle R ock, A rk ........ + 10.0 — 15.8 — 1.9 — 8.2 Louisville, K y ............ + 2 3 .5 — 17.9 + 3.8 + 1.8 Memphis, T en n .......... + 7.1 — 22.0 + 0.4 + 2.9 — 20.5 + 0.3 — 7.0 St. Louis, M o ............ + 18.6 Springfield, M o .......... + 2 7 .7 — 16.0 + 4.8 — 23.6 A ll Other Cities........+ 1 7 .0 — 22.3 + 5.7 — 0.7 8th F. R. D istrict....+ 1 6 .5 — 19.9 + 0.6 — 5.2 Stock T urnover Jan. 1, to July, 31, 1935 1934 1.54 1.50 1.26 1.09 1.28 1.23 1.35 1.32 2.15 2.09 1.65 1.74 2.16 2.02 1.37 1.07 1.71 1.60 1.95 1.87 Percentage of collections in July to accounts and notes receivable first day of July, 1935. P E R C E N T A G E O F C O L L E C T IO N S B Y C IT IE S El D orado, A rk ..................... 53.1% M em phis, T en n ..................... 40.5% F ort Smith, A rk ................... 33.1 Springfield, M o ..................... 22.7 L ittle R ock, A rk ...................37.3 St. Louis, M o .........................52.3 Louisville, K y ....................... 50.5 A ll O ther Cities.................... 32.9 8th F. R . D istrict......................... 47.4% Retail Stores Stocks on H and N et Sales Comparison 7 m o. ended July, 1935 July 3 1 /3 5 July 3 1/3 5 com pared to to same com p, to July 1934 J.une 1935 period *34 July 3 1 /3 4 M en’ s Furnishings ............ + 2 7 .5 % B oots and Shoes ....................... + 2 1 .9 Stock T urnover Jan. 1, to J uly, 31, 1935 1934 — 27.4% + 1.0% — 11.4% 1.46 1.36 — 37.9 + 5.5 — 16.2 2.54 2.77 AUTOMOBILES Combined passenger car, truck and taxicab pro duction in the United States in July, was 337,049, against 361,320 in June, and 266,575 in July, 1934. Contrary to the usual seasonal trend, sales of automobiles in the Eighth District, according to dealers reporting to this bank, were larger in July than during the preceding month. As has been the Page 4 case in every preceding month this year, the total was in excess of that of the corresponding period a year earlier. The increase in the month-to-month comparison was attributed partly to intensive sell ing effort by both dealers and manufacturers and to increased purchasing power in the rural areas. De mand for trucks was more active than in a number of months, July sales being 55.6 per cent and 68 per cent larger, respectively, than a month and a year earlier. The increases in both comparisons were about equally divided between vehicles for light and heavy hauling service. July sales of new passenger cars by the report ing dealers were 18 per cent larger than in June and more than one-third in excess of the July, 1934 total. Stocks of new passenger cars on August 1 were 4 per cent smaller than a month earlier and 8 per cent less than a year ago. Sales of used cars in July were larger by 8.5 per cent than in June and 30 per cent greater than in July, 1934. Stocks of salable second hand cars continued to increase, stocks on August 1 being 11 per cent larger than on July 1, and more than twice as large as a year ago. According to dealers reporting on that item, deferred payment sales in July constituted 46 per cent of their total sales, the same as in June, and comparing with 51 per cent in July, 1934. CONSUMPTION OF ELECTRICITY Public utilities companies in the five largest cities of the district report consumption of electric current by selected industrial customers in July as being 2.4 per cent larger than in June, and 1 per cent smaller than in July, 1934. Detailed figures follow : June, N o. of July, 1935 July, Custom 1935 com p, to 1935 ers * K .W .H . * K .W .H . June, 1935 1,883 2,544 — 26.0% Evansville .... 40 + 2 1 .2 L ittle R ock.. 35 1,894 2,296 Louisville .... 81** 8,097 7,679 + 5.4 1,554 — 2.4 1,517 18,950** + 3.5 19,615 St. L o u i s .... 193** T o ta ls ....... 380** 33,408 * In thousands (000 om itted). **R evised figures. 32,621** + 2.4 July, 1935 July, com p, to 1934 * K .W .H . July, 1934 2,354** — 20.0% + 8.0 2,125 + 8.1 7,492 — 25.3 2,032 19,744** — 0.7 33,747** — 1.0 BUILDING The dollar value of permits issued for new con struction in the five largest cities of the district in July was 21.9 per cent greater than in June, and 129.5 per cent more than in July, 1934. According to statistics compiled by the F. W . Dodge Corpora tion, construction contracts let in the Eighth Dis trict in July, amounted to $9,762,589 which com pares with $9,907,682 in June and $9,738,809 in July, 1934. Production of portland cement for the coun try as a whole in July, totaled 8,021,000 barrels, against 8,725,000 (revised figure) barrels in June, and 8,144,000 barrels in July, 1934. Building figures for July, follow : _________ N ew construction______ Perm its *C ost 1934 1935 1934 1935 18 Evansville .. 46 $ 71 $ 34 10 17 2 17 Little R ock 39 68 219 387 L ouisville .. 89 145 29 Mem phis ... 120 125 484 197 St. Louis.... 278 July Totals June “ M ay * I n thousands 529 281 1,104 307 906 541 362 904 519 (000 om itted ). 481 368 512 _______ Repairs, etc. *C ost Perm its 1934 1935 1934 1935 79 220 $ 61 $ 37 20 28 98 116 27 79 46 35 55 108 97 182 89 135 176 188 644 677 725 648 657 790 356 316 340 228 210 386 LIFE INSURANCE Sales of new, paid-for, ordinary life insurance in states including the Eighth District during July, the preceding month, and a year ago, together with the cumulative totals for the first seven months this year and the comparable period in 1934 are shown in the following table: ( I n thousands July, June, of dollars) 1935 1935 Arkansas.......... .$ 2,085 $ 2,420 $ 38,749 40,192 Illinois............... Indiana.............. 11,563 10,845 4,993 5,074 K en tu cky.......... M ississippi........ 2,178 2,296 M issouri............ 13,929 14,641 T ennessee......... 5,077 5,066 T ota ls............ U nited States.. 78,574 483,491 80,534 490,268 July, Jan.-July, In c., Cumul. 1934 1935 1934 change 2,277 $ 18,542 $ 19,638 — 5.6% 42,173 308,785 317,972 — 2.9 11,128 81,429 77,830 - f 4.6 4,890 39,263 36,593 + 7.3 1,998 15,783 17,053 — 7.4 16,244 109,823 126,132 — 12.9 5,604 39,396 42,246 — 6.7 84,314 613,021 637,464 — 3.8 498,097 3,738,987 3,738,455 + 0.01 AGRICULTURE Eighth District crop conditions during July and the early weeks of August underwent some marked changes as a result of existing weather conditions. Taken as a whole, however, earlier favorable pros pects were well maintained, and yields of the prin cipal productions will for the most part be meas urably above a year ago and compare favorably with the average during the past decade. High tem peratures and lack of rain in some localities resulted in damage to certain crops, but the clear weather was ideal for harvesting wheat and haying. Accord ing to the August 1 report of the Department of Agriculture, corn, which was so late as to arouse apprehension that early frost might overtake it, grew vigorously during July and is now expected to produce a yield about equal to the 5-year average. For the country as a whole this improvement during July increased the prospective corn crop by 228,000,000 bushels, or 11 per cent. Little of last year's grain remains on farms, but with a record output of grain sorghums, a large hay crop in prospect and with oats and barley together, about equal to the pre drouth average, the supply of feed is expected to be sufficient to permit of the limited numbers of livestock and poultry on farms to be fed as liberally as during the half dozen years prior to 1933 and still leave an average carryover for next summer. Esti mates for other crops show less important changes. Farm prices in the main continued above last year at the same time, though some items were lower for the reason that the drouth became very severe last July, with resultant scarcity and a strong upward trend in values of hay, feeds, etc. All live stock prices and quotations on poultry are higher than a year ago. As of July 1, the general level of farm wage rates averaged 99 per cent of pre-war, according to the index constructed by the Crop Reporting Board. This represented an advance of 5 points during the second quarter of the year to a new high July wage index for the 4-year period since 1931. Corn — Corn prospects in the Eighth District improved to the extent of 23,474,000 bushels during July, according to the estimate of the U. S. Depart ment of Agriculture based on conditions as of August 1. On the latest date the yield was estimated at 251,371,000 bushels, which compares with 167,923,000 bushels harvested in 1934, and the 12-year average (1923-1934) of 333,142,000 bushels. Timely rains and high temperatures during the past thirty days promoted growth and color. However, due to lateness of the planting season, favorable weather will be required to harvest in order to obtain best results. Cotton — Weather generally during July and the first half of August has been auspicious for pro gress of the cotton crop in states of this district, and the plant is growing and fruiting rapidly. Picking has begun in the southernmost counties; because of the exceedingly wet, late spring and unusual mois ture remaining in the soil, grass and weeds necessi tated more than the ordinary amount of farm work. However, with exception of isolated cases, fields have been well cleared. Sales of fertilizer tags in states of this district, for the January-July period this year, were 17 per cent greater than for the like interval in 1934 and 83 per cent in excess of the same seven months in 1933. Prices moved within a narrow range. In the St. Louis market the middling grade fluctuated from 11.00c to 11.60c per pound between July 16 and August 15, closing at 11.25c on the latest date, which compares with 11.55c on July 16 and 13.10c on August 15, 1934. Based on conditions as of August 1 the U. S. Department of Agriculture estimates the Eighth District crop at 2,262,000 bales, against 2,323,000 bales harvested in 1934, and a 12year average (1923-1934) of 2,738,000 bales. Total receipts at Arkansas and Missouri compresses for the year ended July 26 were 976,535 bales, against 1,167,566 bales for the same period a year ago; shipments were 745,888 bales against 1,109,876 bales a year earlier; stocks on hand as of July 26 totaled 512,218 bales against 302,537 bales on the same date in 1934. Page 5 Fruits and Vegetables — The apple crop in states entirely or partly within the Eighth District is substantially larger than a year ago and the 5-year (1928-1932) average. The indicated yield in these states as of August 1 is estimated by the U. S. Department of Agriculture at 18,946,000 bushels, of which 9,667,000 bushels represent commercial crop, against 9,519,000 bushels in 1934, with 4,080,000 bushels commercial crop and a 5-year average of 14,937,000 bushels of which 6,512,000 bushels repre sent commercial crop. The peach crop in these states is estimated at 9,581,000 bushels, a decrease of 5.5 per cent from the July 1 forecast, and com paring with 6,576,000 bushels harvested in 1934 and a 5-year average of 7,056,000 bushels; pears, 1,918,000 bushels, against 2,067,000 bushels in 1934 and a 5-year average of 1,624,000 bushels; grapes, 35,469 tons against 35,101 tons in 1934, and a 5-year aver age of 32,065 tons; sweet potatoes, 18,493,000 bush els against 18,692,000 bushels in 1934 and a 5-year average of 16,456,000 bushels. In certain localities truck crops for canning and commercial manufac ture were damaged by the extremely high tempera tures, and the same was true of home gardens. This injury was not general, and with the heavily in creased acreages, supplies are expected to be ample for all purposes. In the district proper the yield of potatoes is estimated at 13,437,000 bushels, which compares with 9,681,000 bushels harvested in 1934, and the 12-year average (1923-1934) of 13,609,000 bushels. Live Stock — The general condition of live stock in the district underwent further improvement during the past thirty days. Milk production per cow on August 1, according to the U. S. Depart ment of Agriculture, was nearly 11 per cent heavier than on that date during the drouth year and heavier than in any August of the preceding four seasons, all years of poor pastures. Even though the number of milch cows was between 5 and 6 per cent lower than at that time last year, total milk production was fully 5 per cent greater than a year ago and as heavy as at any similar season in recent years. At the same time egg production per 100 hens was reported about 14 per cent heavier than a year ago and 3 per cent greater than the average; fewer hens are being disposed of than last year. The estimate of hay production in the Eighth District on August 1, was 6,005,000 tons which com pares with the small crop of 4,151,000 tons in 1934, and a 12-year average (1923-1934) of 6,609,000 tons. While the condition of pastures on August 1 was slightly below a month earlier, it continued above Page 6 the past five years and definitely above the 10-year average. Production of oats in the district is esti mated at 42,947,000 bushels, against 18,141,000 bush els harvested in 1934, and the 12-year average of 50,669,000 bushels. Receipts and shipments at St. Louis as reported by the National Stock Yards were as follows: Receipts July, June, July, 1935 1935 1934 Cattle and Calves..... 133,497 115,613 215,455 H ogs .............................126,609 134,915 238,076 Horses and M ules...... 3,866 4,034 4,432 Sheep ........................... 97,530 82,673 79,867 Shipments________ July, June, July, 1935 1935 1934 77,723 74,679 110,178 82,086 82,901 148,846 3,582 3,873 4,075 13,684 16,676 15,308 Tobacco — Eighth District tobacco crop for 1935 is estimated by the U. S. Department of Agri culture at 216,516,000 pounds, an increase of 3,221,000 pounds over the July 1 forecast and comparing with 206,861,000 pounds produced in 1934 and a 12-year average of 296,688,000 pounds. Generally through the district the crop is progressing favor ably and indications are for high quality, particu larly in the burley sections. Much of the early tobacco has been topped; the late crop is growing slowly. COMMODITY PRICES Range of prices in the St. Louis market be tween July 15, 1935 and August 15, 1935, with clos ing quotations on the latter date, and on August 15, 1934, follow: H igh Close A ug. 15, 1935 A ug. 15, 1934 L ow W heat ...perbu..$ .965^$ .80^4 .82 ... “ .9 754 *M ay ............ ..... ... “ .9 8 ^ •9054 N o. 2 red winter “ 1.00 .8454 N o. 2 hard “ .90 “ 1.0654 Corn ... “ .8054 .7554 ♦D ec...................... ... “ .6 6 ^ .5 6 ^ .5754 ... “ .6654 *N o. 2 m ixed ...... “ .8954 .82*4 *N o. 2 white ... ... “ .85 H .9254 Oats *N o. 2 white ... “ .38 .31 Flour Soft patent....... ..per bbl. 6.75 5.70 Spring “ ...... .. “ 8.30 7.25 M iddling Cotton. ..per lb. .1160 .1100 6.50 H ogs on h o o f........percw t.12.10 *N om inal quotations. $ •91@ .8 7H $ .89 54 .9154s .9154 .9954 . 787/s .s m •59H .8454 .8754 .32 6.10@ 6.40 8 .15@ 8.30 .1125 8.0 0 @ 12.10 .9854 1.0154 1.04 .99 1.0554 • 7 5 ^ @ .7554 .78 54@ -79 .8354 .78 .78 @ .80 .50 6.70 7.85 3.00 @ .51 @ 7 .0 0 @ 8.05 .1310 @ 6.15 Winter Wheat — Prospects for winter wheat declined slightly during July, the August 1 estimate of the U. S. Department of Agriculture being 45,870,000 bushels, which is 1,367,000 bushels less than the July 1 forecast, and compares with 47,197,000 bushels harvested in 1934 and a 12-year average of 49,938,000 bushels. The decline in production from that indicated on July 1 was due largely to harvesting difficulties and premature ripening, caused by the high temperatures. Threshing is backward, and early returns are disclosing much light weight, poor quality wheat. With the excep tion of three years, the yield per acre in Illinois is the lowest since 1909. FINANCIAL Quite generally through the Eighth District demand for credit continued at the low ebb which has characterized the past several months. Liquida tion by commercial and industrial interests has been in about equal volume with new borrowings, with the result that the only negligible change has taken place in loans granted by commercial banks. However, in the immediate past there has been a moderate expansion, seasonal in nature, in require ments of grain handling and flour milling interests, also, for financing live stock conditioning and wool growing operations. Borrowings of country banks from their city correspondents and the Federal Reserve bank were considerably below levels ob taining at the corresponding period in past years. Financing of the cotton movement to the middle of August has been taken care of largely by local banks and other loaning agencies, little recourse upon banks in the large cities for this purpose hav ing been noted. Member Banks — In the four week period ended August 14, total loans and investments of reporting member banks in the chief cities remained practically unchanged, and on the latest date were about 6 per cent larger than a year ago. Total de posits during the interval declined moderately, and there was a decrease of 12 per cent in reserve bal ances, which item, nevertheless, on August 14 was approximately one-fourth greater than on the cor responding report date in 1934. A composite statement of the principal resource and liability items of the reporting member banks is given in the following comparative table: A ug. 14, ( I n thousands of dollars) 1935 Loans and discounts (incl. rediscounts) Secured by U . S. Govt, obligations and other stocks and bonds....$ 56,782 A ll other loans and discounts.... 139,488 July 17, 1935 A u g. 15, 1934 $ 55,713 140,446 $ 76,198 132,788 T otal loans and discounts................ , 196,270 196,159 208,986 Investm ents U . S. G ov’ t securities........... ..... 212,422 Other securities.............................., 132,899 214,848 130,815 193,961 107,133 T otal investments............................... , 345,321 345,663 301,094 Reserve balances with F. R. Bank: 95,610 Cash in vault........................................ 9,294 Deposits N et demand deposits..................... . 417,605 T im e deposits.................................. . 169,153 Governm ent deposits....................., 14,053 108,515 9,051 77,186 7,775 428,178 168,984 13,526 341,147 165,599 33,185 T otal 610,688 539,931 d ep osits..................................... . 600,811 Bills payable and rediscounts with Federal R eserve Bank............... N um ber of banks reporting............ 19 19 19 T h e total resources of these banks com prise approxim ately 60.0% of all m em ber banks in this district. Despite reductions in rates paid on savings ac counts, the total amount of such accounts in selected banks on August 7 was practically unchanged from a month earlier, and 12.8 per cent greater than on August 1, 1934. At downtown St. Louis banks as of the week ended August 15, interest rates were as follows: Customers’ prime commercial paper, 1 to SJ /2 per cent; collateral loans, 2 to Sy2 per cent; loans secured by warehouse receipts, 2 to 5 per cent and cattle loans, 5 to 6 per cent. Federal Reserve Operations — Total Reserve bank credit outstanding remained practically sta tionary between July 17 and August 17, but throughout that period the volume was substanti ally greater than a year ago. There was a sharp decrease in deposits of this bank, but at 157 million dollars as of August 17 the total represented an increase of 13.5 per cent over the same date in 1934. Changes in the principal assets and liabilities of this bank appear in the following table: A u g. 17, ( I n thousands of dollars) 1935 Industrial advances under Sec. 13b....... .$ 449 Other advances and rediscounts............. 64 Bills bought (Including participations). 80 . 108,200 July 17, 1935 $ 472 4 80 108,200 A ug. 17, 1934 $ 2 265 122 93,200 earning assets............................... . 108,793 108,756 93,589 Total Reserves ............................................ . 198,198 Total Deposits ............................................ , 157,143 F. R. Notes in circulation........................ . 143,309 208,766 169,286 141,084 185,648 138,455 134,487 Total Industrial commitments under Sec. 13b 1,929 1,903 Ratio of reserves to deposit and F. R. N ote L iabilities.................. . 66.0% 67.3% 68.0% Rates charged by the Federal Reserve Bank of St. Louis remain unchanged as follow s: 2 per cent on advances to member banks on eligible paper and/or collateral, whether rediscounts or member bank prom is sory notes, under Sections 13 and 13a. 4 per cent on advances to banks and other financing insti tutions on obligations of established industrial or com m ercial businesses, for working capital, under Section 13b. y2 per cent flat for com m itm ents n ot exceeding six months on obligations of established industrial or com m ercial businesses, for working capital, under Section 13b. 5 Yz per cent on direct advances to established industrial or commercial businesses, for w orking capital, under Section 13b. 4 per cent on direct advances to individuals, firms or co r porations (including nonm em ber ban ks), secured by direct obli gations of the U nited States, under Section 13. 5 /x2 per cent on direct advances to individuals, partnerships and corporations (excluding nonmember banks) on eligible paper, under Section 13. Debits to Individual Accounts — The following comparative table of debits to individual accounts reflects spending trends in this district: June, 1935 July, 1934 July, 1935 Natl. .$ 26,340 3,909 El Dorado, Ark Evansville, Ind , 23,122 8,231 F ort Smith, Ark....„ 3,315 Greenville, Miss.... 1,212 Helena, Ark. .. 27,659 , 143,766 ,. 85,734 4,243 6,043 Pine Bluff, A r 5,988 Quincy, 111....... 505,600 St. Louis, M o.. 1,665 Sedalia, M o ..... 11,931 Springfield, Me 5,734 *Texarkana, A $ 26,713 3,156 20,762 7,122 2,774 1,233 29,020 139,964 84,867 4,212 5,629 6,457 608,257 1,808 12,960 5,637 $ 21,034 3,720 19,198 7,235 2,612 1,439 20,149 125,841 87,428 3,408 4,404 5,603 427,283 1,618 11,610 4,683 . 864,492 960,571 747,265 (I n thousands of dollars) July, 1935 com p, to June 1935 July 1934 — 1.4% + 23.9 + 11.4 + 15.6 + 19.5 — 1.7 — 4.7 + 2.7 + 1.0 + 0.7 + 7.4 — 7.3 — 16.9 — 7.9 — 7.9 + 1-7 + 2 5 .2 % + 5.1 + 2 0 .4 + 13.8 + 2 6 .9 — 15.8 + 37.3 + 14.2 — 1.9 + 2 4 .5 + 3 7 .2 + 6.9 + 18.3 + 2.9 + 2.8 + 2 2 .4 — 10.0 + 15.7 *Includes one bank in Texarkana, T exa s, n ot in Eighth District. N ote — A bove figures include total debits charged by banks to checking accounts, savings accounts, certificate of deposit accounts, and trust accounts, o f individuals, firms, corporations and U . S. Governm ent. Charges to accounts of banks, debits in settlement of clearing house balances, payments o f cashiers’ checks, charges to expense and m iscel laneous accounts, corrections and similar charges, are not included. (Completed August 22, 1935) Page 7 NATIONAL SUMMARY OF BUSINESS CONDITIONS BY FE D E RA L RESERVE BO ARD Factory employment and output were maintained in July at the June level though usually there is a considerable decline at this season. Activity at mines showed a substantial decrease, reflecting a sharp reduction in output of coal. PRODUCTION AND EM PLOYM ENT—The Federal Re serve Board’s seasonally adjusted index of manufactures showed an increase in July, while the index of mineral production showed a marked decline, with the consequence that the index of indus trial production remained unchanged at 86 per cent of the 1923-25 average. For the first seven months of the year industrial output volume than a year ago, with increases from last year reported for most sections of the country. Department of Agriculture estimates as of August 1 indicated cotton crop of 11,800,000 bales, about 2,200,000 bales larger than the unusually small crop last year. The indicated wheat crop, while larger than a year ago, is considerably smaller than the five-year average for 1928-32. Crops of corn and other feed stuffs are substantially larger than last season. DISTRIBUTION — Daily average volume of freight-car loadings declined in July, reflecting a marked decrease in ship- Index number of industrial production, adjusted for seasonal variation. (1923-1925 a v e r a g e s 100.) Latest figure July, preliminary 86. was six per cent larger than a year ago. Activity at steel mills, which had declined during June, advanced considerably during July and the first three weeks of August and there was also a substantial increase in the output of lumber. Automobile produc tion showed a decrease from the high level prevailing earlier in the year, reflecting in part seasonal developments. Output of textiles increased somewhat in July, owing chiefly to increased activity at silk mills. In the woolen industry the recent high rate of activity continued, while at cotton mills daily average output declined by about the usual seasonal amount. Meat packing remained at an unusually low level. At mines, output of bituminous coal decreased sharply in July, following an advance in the pre ceding month, and there was also a sharp reduction in output of anthracite. Factory employment, which usually declines at this season, showed little change from the middle of June to the middle of Latest figures July, preliminary, total 148.8; residential 45.9; all other 102.9. ments of coal. Department store sales showed a seasonal decline and the Board’s adjusted index remained unchanged at 80 per cent of the 1923-25 average. PRICES — The general level of wholesale commodity prices showed little change during July and advanced slightly in the first three weeks of August. For the seven-week period as a whole there were substantial increases in the prices of hogs, lard, silk, and scrap steel, while cotton declined. Wheat, after advancing considerably during the latter part of July, declined somewhat in the early part of August. BANK CREDIT — Excess reserves of member banks in creased by $340,000,000 in the five-week period ended August 21 as a consequence principally of a reduction in the balances held by the Treasury with Federal Reserve banks. There were also moderate imports of gold from abroad_______________________ 1932 1933 1934 1935 Index o f factory em ploym ent, adjusted for seasonal variation. (1923-1925 a v e ra g e r s 1 0 0 .) Latest figures July 80.4, June, revised, 79.9. W ednesday figures for reporting m em ber banks in 91 leading cities. Latest figures are for A ugu st 14. July. Employment increased somewhat in the machinery, lumber, furniture, and silk industries and there was a large seasonal in crease in the canning industry. Decreases of a seasonal character were reported for establishments producing cotton goods and women’s clothing, while in the automobile industry employment declined by more than the usual seasonal amount. At coal mines employment showed a marked decrease in July. The total value of construction contracts awarded, as reported by the F. W. Dodge Corporation, increased further in July and the first half of August, reflecting an increase in non-residential projects. Residential building continued in considerably larger Page 8 Total loans and investments of reporting member banks in leading cities showed a net decline of $290,000,000 during the four weeks ended August 14. Holdings of direct obligations of the United States Government decreased by $220,000,000 following a substantial increase in the middle of July. Loans declined by $180,000,000 in the latter part of July but subsequently advanced by $40,000,000, while holdings of Government guaranteed and other securities increased by $70,000,000 in the four-week period. Yields on Government securities rose slightly during this period, while other short-term open-market money rates remained at low levels.
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