The Bridgeport evening farmer., 1911-02-04
REASONS FOR THE
FALL IN RUBBER.
Manufacturers Want To Turn Stock
Into Cash.

4 - 61A LIN ~ ~ a0ASASAVs
Manufacturers Want To Turn Stock
Into Cash.
Automobile Topics" Saturday had
an instructive article on the condi-
ton of the rubber market which is
well worth repeating. The article
follows
Rubber dealers in Paris, France,
January %, announced reduction of
from 10 to % per cent. in the cost OF
the commodity they handle and auto
mobile manufacturers followed with a
similar statement. How this Is go
ing to effect the American market has
not been made clear, but 1t is believ-
ed that because Of the increased pro-
duction of rubber and the great COM
petition among manufacturers in the
United States that a more sweeping
reduction will be made in the prevail
ing prices on this side of the Atlantic
detect signs of any particular life in
the rubber market and that it had
been quiet for some time.
Managers Of New York branches OF
automobile tire companies were reti-
cent on the price lowering question,
ment on that subject come from the
factories, but jobbers said they be-
lfeved the impending cut in prices
was due largely to the desire Of the
manufacturers to turn their stock into
cash at the earliest possible moment.
They also said they thought the usual
advance in tire prices would be made
in the summer when automobiling be-
came general.
Dealers in automobiles and automo-
bile tires said they believed the pro-
duction Of rubber has been large and
that American manufacturers have
not much rubber as usual in the last
few months. No enc who could avoid
1t bought rubber last summer when
the price was high and no one is over
stocking now, fearing that the demand
for automobiles will not be as great
as in 1870.
This, it is said, has naturally left a
great deal Of rubber on the hands OF
European dealers. In London it is
said there are more than $4,000 tons
of crude rubber stored, most of which
was bought when the price was higher
than at present. For this huge
amount; dealers say, a market is now
being sought.
Perhaps, however the strongest rea-
tires, 1t is declared, is the heavy pro-
duction of rubber in Ceylon and the
Malay Peninsula. Ceylon, it. was said.
is increasing it's production enor-
mously, one importer asserting that
the amount is. being doubled every
he believes. the island will produce
10000 tons a year If the demand jus
titles it and will far outstrip the
South American Industry.
The price of crude rubber this week
was $1.20 a pound. Last April it was
s. q pound. The present price in the
opinion of the importers is low. The
former price was greatly in excess of
real value, even though the supply
was limited, due to the boarding Of
the commodity. 1t is predicted that
crude rubber will not again go much
above existing figures and will more
probably continue to drop as the pro-
win feel strongly the trend Of the
market, as so per cent. Of the rubber
brought into the United States annual
ly goes into the manufacture OF tires.
Tire prices have f1uctuated greatly
in keeping with the varying prices Of
crude rubber, but they are now low
er than in long time. the same as
six months of 1910 prices stood about
normal. For one of the standard
makes of tire castings the charge for
a "a by 4 size was about SAG. On
July 1, due to the BOOM in England,
prices advanced about Is per cent,
December l, only seven weeks ago,
came a reduction to about $3.50 and
early in January to about $40.
It can be seen, therefore. that in
side of two months tires have been
reduced more than Is per cent. and
the fact that a further drop is ex-
pected soon shows that the cost Of au-
tomobil'ng is to be much less than In
the past. An advance when the
warm weather comes is likely, it is
said, but with the intense competition
among American manufacturers great
ly increased prices are not looked for
The head OF one of the principal rub
Der importing concerns in America
made this statement:
There is virtually no market in
America to-day. There is no buying
except for immediate requirements.
The American manufacturers got in
early at the low prices anticipating
bought large stocks, some Of which
they still have. Europe bought
largely at the high prices. Moreover
the months of large receipts are just
beginning in Brazil and the heavy re-
ceipts at Para will be more than en-
without touching on the large re-
serves. General businesses does not
appear to be active and the auton1o-
bile business in particular is not so
good as it was six months ago.
.In Europe the conditions are very
much the same. They haves large
reserve stocks in liverpool to which
market Brazil rushed it's rubber with
instructions to its agent to hold for
fifteen shillings. They are holding
these stocks yet and we see no pres
emit signs of revival
AS indicative of the fact that the
tire makers are now looking for bus
mess harder than they formerly did
it may be said that where as they
formerly declined to guarantee them
for at least $4,000 miles and in some
cases for 5000 miles. Large consum-
ers now receive tire rims and other
accessories free, whereas they former
ly had to pay for everything they got
That tire repair concerns now re-
cover tires for from $3.50 to $40 and
give q guarantee of from 1000 to $500
miles for their work has something
to do with the lessening of the de-
mand for tires.