Los Angeles herald., 1909-02-20
STEEL TRUST IS
MADE TO YIELD
FORCED TO LOWER PRICES TO
CONSERVE INDUSTRIES
OPEN MARKET FOR PRODUCT AT
LAST SECURED
Leading Manufacturers Compel GIgan-
tic Corporation to Recognize
Rights Of Smaller COM
petitors
LRv Associated Press.1

NEW YORK, Feb. 19.-An open
market in the iron and steel trade
that manufacturers believe will lead to
stimulation of the industry was Gre
ated late today when former Judge
/ Gary, chairman of the directorate Of
the United States Steel corporation,
| made an official announcement that
] ''the leading manufacturers of iron and
! steel have determined to protect their
/ customers and for the present sell at
such modified prices as may be neces-
! sary with respect to the different
commodities in order to retain their
fair share of the business"
! The prices which may be determined
upon will be given by the manufac-
turers to their customers direct.
The action of the leading manufac-
| turers in affecting an open market
followed a series of conferences that
have been held here for the last three
days by Judge Gary and the heads Of
the various subsidiaries of the COR
poration, together with officials of
other steel manufacturing companies.
Gary's Statement
Judge Gary in the official statement
says the smaller steel manufacturing
| concerns for one cause or another,
particularly the tariff agitation, have
become more or less excited and de-
moralized and have been selling their
products below prices generally main
| tanned, and this led to unreasonable
price cutting by certain manufactur-
/ ers who, though opposed to change,
felt the necessity Of protecting their
! customers.
Following is the statement concern
ing the attitude of the leading manu-
facturers, which was made public by
| Judge Gary after the meeting today:
Following the panic of October,
| 1907, the iron and steel industry was
in jeopardy. Jobbers and consumers
throughout the country had purchased
| large stocks at prices prevailing when
conditions were favorable and these
| were undispOsed of. Pending con-
tracts for construction which involved
| large purchases of iron and steel were
| extensive. Contracts for new fur
naces, mills and equipment and for
raw and Semi-finished material had
been made/by large numbers.
| An immediate and radical reduction
in prices would have meant bankruptcy
to multitudeS. To prevent disaster and
ruin and at the request of scores who
| were interested, a large percentage of
the leading men connected with this
industry met to advise with each other
in regard to the best interests of all
concerned. and including the general
public Various meetings followed
from time to time, until the middle Of
June, 1908. Stability of prices distin-
guiShed from wide and sudden fiuctua-
tions, existed until about the beginning
of 1909, though no agreements were
made to maintain prices and notwith-
standing small percentage of manu-
facturers who stood aloof from the con-
ference.
For a year preceding January 1,
1909, there was gradual, though not en-
tirely regular Improvement in the iron
| and steel trade and an increase in the
sales made.
'As an illustration, the average daily
| bookings of new business of subsidiary
companies of the United States Steel
Corporation were 1922 tons for De-
cember, 1907; 1S,648 tons for June, 190S
and 29,6S5 tons for December, 1908. DUR
ing these months the total capacity of
these companies was about $4,000 tons
per day.
Forced to Admit Error
Until within the last forty-eight
hours it has been the belief of many
if not most of the leading manufactur-
ers of iron and steel, that no general
! reductions in prices were necessary or
desirable.
However, during the last two DAYS
many of the manufacturers have been
In conference for the purpose of giving
tO one another all the information and
facts obtainable concerning actual con-
ditlonS in detail. 1t appears that for
one reason or another including par
ticularly the tariff agitation, many of
the smaller concerns who have not
i been disposed to cooperate during the
last year, have become more or less
excited and demoralized and have been
selling their products at prices below
those which were generally maintained
This feeling has been somewhat eX-
tended and has influenced unreasonable
cutting IN prices by some of those who
were opposed to changes but felt COM
PEELED to meet conditions in order to
protect their customers.
AS a result of these conditions there
has been material decrease in new
business during the last months for
the reason, as stated by consumers,
that they proposed to wait until after
they were satisfied bottom prices had
been reached.
To Protect Customers
''In view of the circumstances stated,
and the further fact that the stocks on
! hand at the time the panic occurred
: have been disposed of, and the con-
tracts in force at that time have been
completed or taken care of, so that the
necessities for the maintenance of
prices which formerly existed have been
modified, the leading manufacturers of
iron and steel have determined to pro-
tect their customers, and for the pres
ent at least, sell at such modified prices
as many be necessary, with respect to
different communities, in order to- re-
tain their fair share of business.
'"The prices which may be determined
upon and the details concerning the
same will be given by the manufactur-
ers to their customers direct.
'The friendly relations which have
existed between the principal manu-
facturers will continue"