New-York tribune., 1920-10-15
Boards Ships
AT SIS a Ton
Is British View
U. S. May Be Forced to Ac-
cept Considerably Less, 1t
Is Said; English Gloomy
on the Maritime Situation
Capital Costs Assailed
No Profit Possible on Basis
of $50, With English at
500 Average, Is Report

That the Shipping Board within a
year may be glad to get s75 ton for
the steel steamers for which it is now
asking from S160 to $3.50 a ton is the
prediction made by the British ship
ping publication Fairplay Indeed, the
PAPER adds, the board is likely to be
:orced tc accept considerably less than
SIS
Maritime conditions. it is pointed
out, are bad in Great Britain, but, it is
argued, they are much worse in the
United States, because of the much
higher capital cost here.
at is interesting" says Fairplay, "to
note the extent to which the conditions
ruling to-day repeat those which fol-
lowed on the boom of 1900 But while
in the 1900 slump the drop in values
reached only f2 or f3 ton, the fall
from last February's prices before it
reaches bedrock may easily work out
at six times that figure, which shows
Row urgently necessary it is for owners
Of high priced tonnage either to reduce
dividends 20 a minimum or dispense
with them altogether in order that tho
book value Of the assets may be writ
ten down to as near as possible their
market worth.
American Firms Problem
of, however, new company in this
country, owning, say 1900 ton
steamer purchased in February at $50 q
ton. may seem to be in sight of dis
sster, what can be said Of the new con-
Germs in the United States which have
ACQUIRED American tonnage at $3.50 to
5000 q ton, which is equal to about f43
IN f57 q ton? Some writer's seem to
be Of the opinion that these new ship
ping companies will not only be keen
competitors of ours, but that the in
dustry will be built up on perma-
nent basis.
"That the Americans will be keen
competitors goes without saying, but
that thew viii be able to make money
and therefore justify their existence a.
a business proposition when freights
lecome more normal, seems to be
ont Of the question. Assume, for ex
simple, that their vessels work .ut at SAB
q ton and that the British owners
beats cost him G21 ton. Recent
freichts have been such as often to
make it difficult, if not Impossible, to
fix a profitable voyage for the British
steamer. And if this be so, with the
prices ruling here, what must be the
position OF the American vessel cost
ing more to run and at least double
FOR insurance, depreciation ard in
terest? And as for tha American
Shipping Board trying to Justify the
market price by the cost of replace
ment, it is up against the impossible
and has only to study the experience
Of British shipping for the last forty
wears to convince itself that there is
no connection between the two.
Shipbuilders in Dilemma
with circumstances as they are to-
day, either shipbulding costs have to
be reduced TO meet the fall in the price
Of second hand tonnage, or the builder
has TO &C without orders, leaving his
ward to follow the ordinary course that
the latter policy must entail. SINH
larly when secondhand vessels rise in
value the builder naturally increases
his price for laying down tonnage anG
makes such profits as he can over and
above what the price Of wages or ma
terials may be.
".To attempt to saddle the new
Axed burden Of $3.50 per ton seems to
experts on this side to be just looking
for trouble, and it is by no means sur
prising that, in view of the market con-
dtions, bids should be few and far
between
Indeed, it is very possible that
within twelve months the Shipping
Board will be only too pleased to ac-
cept 81 per ton, and, unless they make
up 'he's minds quickly, it is quite on
the cards that they II ay e forced 20
accept consider bly, less than this fig
are, and it may even be that the boats
w,.sh they offered It $500, or e57 a
ton, and which beftre the war could
have been purchased at Sc ton, within
year viii be so much nearer the
latter than the former figure that there
VIII be no appreciable difference be-
tween hen, "