The sun. [volume] (New York [N.Y.]) 1916-1920, 1919-05-09
STEEL MEN WIN IN
OPEN PRICE FIGHT
Continued from Fret Pogo.

Continued from First Pogo.
obtain preferential prices as compared
with the general public,
The steel interests were unwilling
make any change in the prices an
nounced In March. The conferences on
thls subject are at an end and the Rail-
road Administration, in accordance with
it's settled purpose, will proceed as rap
Idly as 1t needs steel materials of any
KIND to ask for competitive bids and
purchase accordingly. The Railroad
Administration will at once. in accord
ance with this policy, ask for bids for
100000 tons of steel rails"
BY way Of comment on the prices
proposed In March, as we'll as in support
OF the prices suggested by the Railroad
Administration. the following views
were expressed by Messrs. Spencer and
Powell:
THE reduction since the war in q
| single element of cost Is 80 great as to
make the prices proposed by tho steel
interests and the Industrial Board prac-
tically as profitable to the steel inter-
ests as were the higher prices that pre-
vailed during the war upon the basis of
which the steel interests made enormous
profits This Item of cost il the price
, of scrap materials which Is not a con-
trolled commodity. but the price of
which fuctuates according to supply and
demand, and which of course can be
ana is used very largely In the making
OF steel products.
The fall in the price of scrap ma
terial (from $50 a ton to about SIS a
ton) has been so great that the result
ing decrease in the cost of steel prod
ucts is practically as great as the total
proposed reduction in the prices Of steel
| products
Therefore. while the public has
| thought the steel interests ought to
| make and could well afford to make i'm
portant concessions to encourage the re-
| sumption Of business, the fact Is that on
account of the reduction in the price of
scrape material alone the prices pro-
posed for steel products represent no
concessions whatever from war time
profits.
Huge ProAts Per Ton.
THAT the steel interests have made
profits so large as to make substantial
| concessions practicable under existing
conditions without affecting tho wages is
ssr:kingly illustrated by a consideration
of the profits made by the steel interests
for the calendar year 1918.
for the year 1918 reports the net earn
ings from all rolled tonnage, before de-
Quoting income tax, excess profits tax.
&c, a profit Of about $50 per ton
The Midvale Steel Company for the
same period shows a profit OF approxi-
motely $35 per ton.
This statistical information for other
steel producing companies for the year
1918 Is not yet published, but their
| financial statements indicate results
| which were correspondingly favorable.
THE arguments which have been pre-
sented in the effort to support the prices
| proposed by the steel interes and the
Industrial Board have rested upon costs
incurred during the war period. Even
these costs show exceedingly handsome
profits to the low cost-producers.
But 1t is obvious that these costs,
without reduction in wages. will on ac-
count of the termination Of the war be
| subject to very important reductions, In
| addition to the great reduction in the
east Of scrap material already referred
to.
THE war costs appear in many in
| staLces to involve a heavy increase in
the royalty for ore or the assumed value
| of the ore In the ground. This increase
did not respresent an actual increase in
cos. so fan as the producers Of the ore
were concerned. but simply represented
| heavy additional profit. Yet this In
creased profit in ore appears to be in
cluded In the war costs upon which the
figures have been based. The cost Of
| coko has fallen substantially from SO 60
81 per ton, representing a saving of from
IS to IS per ton of iron.
THE steel interests and the Indus
| trial Board have proposed a price of
$3.50 for steel billets, and yet they have
proposed prices for finished steel prod
! ucts which are wholly out of line with
the price for steel billets. The differen-
| tials which the steel interests and the
Industrial Board propose for the fin
| ished products as compared with steel
billets are so great as to make the prices
for the finished products altogether UNI
attractive and altogether untusti6able,
especially in the light of the considera-
| tons already pointed out.
Compares Prices.
"If the average differentials for fin
ished products as compared with steel
billets during the sixteen years preced-
ing the year 1917 be increased by 80 per
cent (to insure against any adverse ef-
feet upon the wages paid to labor) tho
resulting differentials and prices for the
finished steel products would be as fol-
lows, as compared with the prices actu-
ally proposed (per ton Of 2.24o pounds) ::
Prices
fixed by
After Peek
Add 50eo New COM
to diff. price mittee.
Bars .....,............s1O 80 1850 s5lel
Res semer steei rails. 2s7 ll37 $500
Galvanized sheets No. Is H.<S 1ls.eS III. 6S
Beams .,.,.............. 1904 61.H k.8S
Wire rods ,,,,,... 9H 1881 $500
Tank plates. 1928 6l.B 90 .S
Black sheets No. 2s..... 4o.s7 1911 H.A
Tin plate S3.s< 12a.34 100. 30
Nails ................. 2369 s11s T2so
"Messrs. Spencer and Powell pointed
out that the cost Of open hearth rail
was no greater than the cost of Bessemer
cnst nd nrlca of hnt b