The Scranton tribune. [volume] (Scranton, Pa.) 1891-1910, 1896-12-03
ANTHRACITE TRADES
PRESENT CONDITION
Operators at the Mercy Of Unreliable
Sales Agents.
OUTLOOK IS NOT REASSURlNG
Coal Operators Association Charges
That the Industry is Grossly Mis-.
managed..R Railroads on Unstable
Foundations Carrying Undemanded
Coal in Order to Bolster Up Their
Seeming Prosperity..RcactiOn Will

SOulcs
The coal trade is at present in
discouraging state SO far as the opera
tors are concerned. If the opinions Of
the producers GO for anything prices in
the immediate future will hardly ap-
proach even the low average of Octo-
Der. 1t Is claimed that early last
month the sales agents blundered and
overestimated the November and De-
cember demand with the result that
many of the coal carrying roads glut-
ted the market.
The Anthracite Coal Operators as
sociation in its report of Dec. l claims
there has been gross mismanagement.
In the early part of November. says
the report, the sales agents, with that
acumen for which they are noted, fore
saw great expansion in the market
for coal. and concluded that 1t would
absorb $4,000 tons. The mines began
working on that basis and in a few
days the railroads had so much coal on
hand that there was no place to put it,
Sales We're slow and prices on the de-
cline, while stocks We're increasing
Then some Of the roads with a keener
sense of equity and honor than the
others, ordered their collieries on
shorter time so as to reduce the out
put and maintain fair price. Others,
however, have been forcing their pro-
duct on the market, and there Is little
reason to hope that November and De-
cember prices will reach even the low
average received in October.
If the consumption had been estimat-
ed at 3,500,000 tons it would even then
have exceeded the actual demand. To
have estimated it at one million tons
in excess of this, in the face of heavy
increase in both tidewater and line
stocks during October. shows the utter
incapacity of the sales agents, while
the present condition of the trade bears
most damaging witness to the puerilty
of their efforts to upset the immutable
law of supply and demand.
SALES AGENT THE AUTOCRAT.
No other great industry in these
United States Is SO grossly misman-
aged. The sales agents wish for large
tonnage, and 1t is manifestly more to
their profit, and to the profit of all the
commission houses depending upon
them, to handle many tons, even at a
low price, than smaller number of
tons at higher price. Their commits
sion is the same In either case. The
operator, on the other hand, and all
holders of securities in coal-carrying
railroads, are more vitality interested
in receiving a higher price for their
Oulput, WltlOul 81 ACSaiu " thN
number of tons. Each acre of coal
land contains fixed amount of coal,
and it's value depends entirely upon
the price which the sales agent chooses
to sell it for. If he sells for a high
price and eXhausts it slowly, then the
land has greater value as an invest
ment; but when, in order to secure
large tonnage and the consequent COM
missions he sacrifices the coal for low
~ T. Is.,rr I'll Ia
of the security holder in such property,
by depreciating its value and destroy
ing the foundation of the securities.
While the sales agents themselves in
many cases may not secure direct
profit in commissions from larger
tonnage, it would be interesting, and
undoubtedly very instructive to the
stockholders of some of the larger
| roads, If the relationship between the
commission houses which handle the
coal, and the railroads was looked into.
If this power was used to further the
general welfare Of the regions as 1t
should be, great good might be ac-
complished, but instead, it Is like the
selfish, petty warfare of the feudal
lord, each trying to support his own
insecure throne at the expense Of the
! people and his neighbors.
Some of the railroads stand on an
unstable foundation, and 1t is to be
expected that where they are in such
absolute control they shall try to ex-
| tort sufficient revenue to make good
heavy deficits in other accounts. The
assertion that some of the cOal-carry-
| ing railroads stand on an unstable foun-
dation is pertinent since the methods
now being employed to bolster them
| into a state of seeming prosperity will.
before long, react disastrously on all
| of the interests involved. The proof
| of this may easily be found by ascer-
tanning the amount Of unmined coal
owned or controlled by each of the
roads. In the figures collected with
great care by William Griffiths, 1t Is
shown that only three of the eleven
coal-carrying railroads have sufficient
| coal lands remaining to insure them
tonnage for over one hundred years.
| The other eight roads will exhaust
their resources in periods varying from
| nine to sixty-three years.
WHERE'S THE SINKING FUND?
Without implying doubt as to the ac-
| curacy of these figures, there are GER
| tain conditions which materially re-
duce the time during which most of the
| railroads will be able to mine and
| transport coal at profit. The opening
| of new mines will involve a heavy de-
Law of money, and with increasing
| depth the coal will cost more. Every
| item of expense will become greater,
and to meet the rapidly increasing out
nut Of the cheaper bituminous coal.
anthracite will likely have to he sold
| for less money, or If not that. then as
| a figh-priced fuel for a limited num-
| Der of purposes To meet this future
| how many of the railroads have been
| t,,in ctnlSinu fund n inn
| burse their capital account when this
| source of great revenue is exhausted? ?
There Is, in the present conduct of
| the coal trade, such an entire absence
| of business foresight and, 1t may also
| be said, of commercial integrity, that
| II is almost a matter Of surprise that
| the past months of 1896 have shown
| an Improvement over the reckless
| course followed in 1895. For such 4
change the sales-agents are congrat-
| ulating themselves. By means OF an
/ erudite arithmetical calculation they
| prove to their own satisfaction that
they have not sent to market more than
their due proportion Of coal, and add
ing up their figures proves, further,
| that there Is no excess over the amount
which it was estimated the market
would require.
The application of the time honored
rule of first principles in arithmetic
shows, however. that as a matter of
fact they have largely exceeded the
needs of the market; that stocks have
increased at tidewater. and are unusu-
ally heavy along the lines. and that
they have, through this continued ex-
cessive production, been forced to keep
up that transparent game of "bunco-
ing" the public with fixed circular
| price, while the actual sales are made
from forty to fifty-five cents and more
below it.
1t has been stated in all earnestness
that the sales-agents could not main
tain circular prices prices because of
legal obstacles. The incOrrectness of
such reasoning seasily shown by ref
| erence to any of the rreat ind,i 81 rioc