The Savannah morning news., 1901-11-11
COMMISSIONS REPORT.
.ce of Prices of Iron and steel
products in the Past Decade.

Washington, NOV. ne lhuustrldl
omission issued to-day a special re-
.rt on an investigation conducted by
me commission regarding the cost
I'D selling prices of iron and steel
"noducts from 1880 to 1901. The state
rnent shows that in 1890 the cost of
1,oel rails ranged from s25.93 to $34.52
n 1891 from $24.15 to $25.6S; in 1892
from $22.65 to $24.S2; in 1898 from $19.25
"a s22.62; in 1894 from $17.79 to s21.29;
IN 1895 from $16.6S to $25.47; in 1896 from
u-72 to $685.; in 1897 from 1851 to
r762: in 1898 from 1857 to 1871; in
1899 from SSH in January to 1852,
in December: in 1900 from $36.12 in Feb
ruary to $21.S3 in October; in 1901 from
sg54 to $25.9S.
According to the showing made there
was margin in the selling price over
the cost price for every year from 1890
I'D to July of 1898. In 1890 the margin
ran from 70 cents to $3.50 per ton; in
1891 from $3.50 to S5.S5; in 1892 from
s4.6S to $7.S5; in 1893 from $4.75 to $S4s;
in 1894 from $2.71 to $6.21; in 1895 from
S.1O to $9.06; in 1896 from $7.31 to $102S;
in 1897 from. AZ cents to $7.3S. In 1898
the highest margin was $1.33 in jan
uary In July a loss of cents per
ton is noted the cost price being $l7.05
as against selling price of $500.
Again in June of 1899 when the cost
price was $27.62 there was a loss of 81
cents. In July of that year the loss
was S1.51 ON cost price of $29.76; $1.15
on a cost price of $32.15, and in Sep
TENDER; $1.4S on a, cost price of $685. A
loss of about 81 per ton is also
reported for the months of January,
February, March, April and May Of
1900 when the cost price ranged over
$50 per ton. Losses are claimed on
steel billets for most of the year 1900
and for the first four months of 1901.
A loss is recorded for every month in
1895 on billets. Losses are recorded for
the last three months of 1900 in pig
iron. The lowest cost of production for
pig iron was recorded in 1894, when it
was $S.65 per ton. In 1900 the cost of
pig iron was 1888.
Commenting in a very general way,
the commission says:
Beyond question, there have been
steady improvements in the months of
manufacture tending to reduce the cost
of labor and incidentals per unit of
product. On the other hand. the adj
vance of wages from 1899 to 1901. es-
peciallY as compared with the years
Immediately preceding, no regard to
which has been given in making up in
figures, may in part have offset the
reduction through such improvements.
In any case, the comparison as to costs
will not be greatly vitiated by mac
curacies in the items of labor and in
cdentals, since these represent COM
paratively small proportion of the cost
of Transforming the respective raw ma
terials into finished products"
The variation in prices is commented
upon as follows:
Probably the most conspicuous the
fact shown in the diagrams is the very
rapid and wide variations in the prices
of all three of the products compared,
and most of all in the prices of pig
iron. Even in earlier years. not cover
ed by the diagrams, the price statistics
show similar sharp fluctuations.
These often sudden and violent fiuc-
tuations show, among other indica-
tions, the great changes in demand for
iron and steel products from time to
time and the4maFked constituencies of
prices TO such changes in demand. No
very large stock of iron and
steel is usually held in advance,
and when a period OF prosperity causes
a great extension of the uses of the
products, the mills often find them
selves temporarily unable to keep pace
with the demand, while buyers under
certain conditions are willing to pay
almost any price. -~4
"A noteworthy feature of the dia-
gram regarding steel rails is the fact
that the selling prices for considerable
periods of time throughout the ten
years covered by the figures have been
held uniform. Thus, through most OF
1891 and 1892 the uniform price named
was $50 per ton; through 1894 1t was
$24 per ton, and through the latter
part of 1895 and 1895 it was $28 per
ton. This uniformity in prices is
doubtless due to the existence of pools
from time to time among the manu-
facturers, and the sudden changes fol-
lowing the periods of. uniform
ity are probably iexplicable,
not so much by great changes
in demand at the precise date of
the change in price, as by either the
breaking of pools or the determination
on the part of their managers that the
previously fixed prices were too high
or too low 1t is very commonly stated
in the trade journals that the nominal
prices quoted for steel rails are not al
ways maintained in practice, but that,
secretly or openly, sales are made be-
low the quoted rates.
ITO certain extent the changes in
the price of rails are followed by
changes in the price of pig iron, but
the more or less artificial price Of rails
indicated in the diagram prevents this
parallelism from being as close as 1t
is in the case of billets and pig iron.
We find that the cost of rails, which
depends largely on the price of the
chief constituent, pig IRON varies much
more greatly from month to month
than the selling price while on the 9TH
er nand, 1t occasionally happens that
very sudden change in the selling price
OF rails appears unaccompanied
by any cerrespondingly sudden
changes in cost. 1t naturally follows
that the margin between the cost and
selling price is a much more variable
quantity in the case of rails than in the
case of billets. The increase in the
margin during the year 1896 is note
worthy, while still more striking is the
TACT that from 1897 to the middle of 1900
almost no margin appears. During
1893 the price of rails did not increase
as rapidly as that of steel billets, and
IN some months Jagged even behind
that Of pig iron, so that the margin on
rails for several months in 1899 and
1900 was considerably less than zero
On the other hand, the price of rails
oid not fall as suddenly in 1900 as
Inc price of pig iron or the cost of rails
SO that for a short time the margin
rises to very high point, but almost
Immediately thereafter falls rapidly to
approximately Zero"