New-York tribune., 1920-10-14
Shipping Board
Racks Rate War
On French Line
Benson Urges Finish Fight
Against Concern That
Refuses tC Abide by
Conference Schedule
Affects Eastern Seaboard
Price Slashing Authorized
10 Whatever Extent Is
Necessary to Compete

WASHINGTON, Oct. l3.-A rate war
% finish between II north Atlantic,
south Atlantic and Gulf ports and
hv the refusal of the French Line to
maintain the schedule of rates estab-
l;saed by the shipping conference, Ad-
,irsl Benson, chairman of the United
s,ates Shipping Board, said to-day
All foreign and American concerns
...t compete with the French Line
hsve been authorized to slash rates to
ss low a level as may be necessary to
meet the competition o. the French
line. Admiral Benson said, and they
have agreed to Nngage in q ra ce war TO
the end.
Admiral Benson on Monday approved
.he decision to meet the rate reduc-
ton OF the French Line bN slashing
rates on all other lines operating in
the same territory.
Chaotic conditions are expected to
follow the decision Of he Shipping
Board TO meet the French Line and
the Lloyd Beige in cutting rates.
That the outcome will be general
rate war in these trades, with the large
lines in the Atlantic conference meeting
Ill cuts. is the view of the representatives
Of some Of the largest shipping inter
ests. 1t is evident they add, that the
Sbipnine Board, which has been unable
10 secure profitable opera ti0n of its YES
sells at the prevailing levels for some
time past, will be the chief sufferer.
The present situation has been
brought about chiefly through the re-
.usal Of the French Line to hold rates
at the. same figure as the Shipping
Board. Admiral Benson's attempt to
secure an agreement having failed and
rate-cuttng having been under way for
some time past, the oard is now re-
ported to have decided to let the op-
orators of these ships have free hand
in fixing freights on the routes af-
fected.
Among tine large lines operating to
the ports indicated are the international
Mercantile Marine Company, the
Cnnard Line. the Prince Line of Fur
ness. Witty. & Co.. the United Ameri-
ran Lines. the Kerr Steamship Company
and the Barber Lines.
Lining Up for Rate War.
While there has been considerable re-
ductjon in the volume Of cargo for
French ports for some time, there has
baen a considerable trade with Ant
werp. Rotterdam and Hamburg. That
the large lines are in a much better
position to meet cuts than the Shipping
Roard is manifested by the Withdrawals
Of the boards ships recently from
many routes because rates could not be
obtained that would permit profitable
operation Independent lines, however,
have been able to operate successfully
At these same levels. Now, with cuts
in freghts. Shipping Bird losses VIII
be increased materially.
Conditions in the charter market
recently have shown that even private
IL owned American tonnage Is hav-
ing difficulties in meeting foreign
competition. One Of the large charter
inc interests. A. H. Bull g. Co, re-
ports that last week in the coal ex-
port trade only one American vessel
was chartered for French Atlantic
ports. as compared with seven ships
under foreign registry. For Mar
seiles. Bordeaux, Rotterdam and
Stockholm not a single charter of an
American ship is reported, as com
pared with seven foreign vessels. An
other firm states that out of thirty
two steamers chartered for various
ports only FIVE were under the Ameri-
can flag. The representation of ships
of the American merchant marine,
therefore. was only about is per cent
of the total chartered.
Greater capital cost of American
ships, as compa; with those of
other nations, is regarde by opera
tors generally as the chief handicap
under whc,. American tonnage is
laboring in competition. Operating
costs of vessels under American
registry, for q 10000 deadweight ton
steamer, are said to be only about
$4,000 year greater than those Of
British vessels.
Capital Cost the Problem
Higher production cost of Ameri
can vessels is much greater factor
IN making competition difficult, opera
tors say. Placing the average cost of
American vessels at the low figure
under present conditions Of $3.50
ton in COMPARISON with 500 a ton for
british ships the difFerential against
American tonnage is a heavy one.
With an advantage of $50 ton on
us capital cost. the British vessel can
operate profitably at lower rates. On
a lV'OO0 deadweight ton ship, for in
stance, taking insurance at 3 per cent
per annum, $4,000 more must be paid
on the American ship. Depreciation
at per cent means S25, 900 more to be
PAID on our vessels and interest on
Ae investment, figured also at 5 per
eent accounts for an additional $685.
WV yearly. Adding in the $4,000 ex
cess on labor, fuel, provisions and
o,her operating costs, the annual ham
d'cap against the American ship
amounts to $50 900