The Birmingham age-herald., 1910-12-02


 halt?
 There can be but one answer invest ment in other lines promised larger or safer return on capital, and attracted 1t. Is there a remedy for this state Of affairs that will permit the southern iron trade to share in the general growth and prosperity of the southern district? Yes. It Is to sell the production in It's natural market. Hitherto a great portion of pig iron produced in the south has been sold in northern markets and this fact has been used many times as eVl- dence of the wonderfully low cost of pro- duction of the southern product Does foundry iron sell at S1 Birmlng- ham and at the same time sell at Slo.S9 at Chicago because it has been produced s4. .S5 per ton cheaper in Birmingham than in Chicago? Not necessarily. Birmingham makes more iron than it can use. and the surplus must be mar ketod. Chicago needs more iron than it makes and can use the surplus Blr- mingham product at a price, but that the profit on iron used at Chicago, which IS made at Chicago, is greater thah ths profit on iron made at Birmingham anu freight paid to Chicago, is shown by the increase in pig iron production in Chl- cago as against the stationary production in the southern district. It is too much to expect of one iron-making district that it can pay $4.35 per ton, or aoout zs per cent of the total selling price as freight, to foundries situated close 10 the furnaces of another good iron-produclns district, and make as large prohts-lhe handicap is too great
 Natural Southern Market But what is a natural market for southern iron. It is the south itself, supplemented by the export trade. Put the surplus pig iron produced in the south into steel. The larger portion of the steel used in the south is shipped in from the northern district On the principal steel products Bir- mingham can reach with freight no l higher than Chicago or Pittsburg, a territory inhabited by 5o per cent or | the population of the United states The rates to tidewater are lower than from either Pittsburg or Chicago. l Trues the population of this terri l tory uses less steel per capita than l the average population of the United
 States, but an increase in this respect l is noted.
 l If is true. too, that during the tran l sition period the orders will be for | small lots and of a diversity of sizes I that will initiate against the highest l mill efficiency, but these conditions l will steadily improve as the small In l dustries grow larger. The production | of steel ingots in the south is steadily l increasing.
 Plants are now being constructed which will increase the production materially.
 The merchant furnaces will find an increased local market for their iron product, as the quality ot steel made in the south increases. for with it there will be an increase in the fabricated steel products which use cast iron parts as well as steel parts.
 If a portion of the iron and steel produced could be regularly exported, the trade would be upon more sub stantial basis than if dependent en- tirely upon the domestic market No trade is subject to wider variation in the demand for Its products than the one here discussed. When the ne- cessity for economy arises, iron and
 steel products are the first marked off the purchasing list
 l Expenses Keep On
 When there is no demand for steel though the mills stop, the expendi- , lures do not. Not only does expensive
 equipment earn nothing to pay taxes, interest and depreciation charges, but Q water must be kept pumped out of the [ mines and at least the nucleus of an
 organization maintained.
 The heaviest losses do not fall on capi- tai; payrols decrease, employees, mer- l chants, lawyers, doctors; in fact every member of the community is directly af-
 fected and then, to a degree, the mem beis of other communities doing business with the one where there are idle plants
 suffer. The value of having a certain
 percentage of export orders on the books is that business depressions are seldom
 worldwide.
 
 depressions occur, we could promptly fill the order books with export business, but
 that is not possible.
 The export trade must be carefully cu- tivated to be secured, and If we value it's
 regularity as a partial insurance against
 shutdowns, We must do our part in the performance of regular service.
 Central America and the countries on
 the east coast of South America would
 now be the natural export markets for
 southern iron and steel products, were
 transportation availa ble. When the Pan- anna canal is completed, the western coast
 of South America and points In the far
 east will naturally draw their supplies
 from us if transportation is provided
 through the path of least resistance. The
 southern states should be trading heavily
 now with all the eastern coast countries
 to the south of us but they are not.
 During the seven months ending with
 April, 19l0 74,000 tons of rails were eX- l ported through southern ports to South . America. This was possible only because D the order was large enough to permit
 chartering vessels to come to southern
 ports and take the rails to destination. : Exports in small lots cannot go be- y cause there are no regular steamship lines available. It hardly seems prob- ] able that such lines will be established
 unless energetic steps are taken and if - transportation facilities from southern
 ports are not provided the southern peo-
 pie are going to be disappointed in the
 beneficial effects of the Panama canal
 upon their district
 \ Shipping Equation The development of American shipping
 has been discussed for years, but no ef-
 fective method for it's encouragement has
 been secured. Ship subsidy seems to be = unpopular with the people. In lieu there ol there has recently been advocated A III congress discriminating duties down
 ward In favor of goods brought to this
 country in American ships That this
 method Will result to the immediate ad-
 vantage or in the proper development
 or our southern ports, is extremely
 douot1ul' for while it would undoubt-
 edly work to the advantage of such shins
 as bring in silks, satins, laces wines
 manufactured products, etc. these nrod g. ucts come largely from European conn , tries through importing firms in tho 's northern districts, whereas we are nartic- ularly interested in having lines nIv he