New-York tribune., 1921-02-06
Steel Industry
Watching Plal,
ToBoonl Trade
Makers and Users Much In
terested i'm Efforts of Some
Producers TO Increase Oul-
put of Partly Idle Plants
Move Based on Nerve
inability of Steel Corpora
ton TO Cut Wages Without
Prices One of Obstacles


,ba users-are watching with interest
-. efforts made this week by num-
her Of manufacturers to fight their
var out of the impasse by resuming in
mart plants which have been entirely
.ypsed down. or by increasing the
.etjve units in plants which have been
on part time.
Most Of these assumptions are rec
ornired throughout the industry to be
hssed on sheer nerve, as the new busi-
ness in has scarcely justified the ex-
tent to which some plants have re-
sumed. On the other hand, in num-
her Of instances orders have been &C
eumulated sufficiently to warrant start
ing up, but with no definite notion of
how long operation could continue.
So many assumptions occurred on
February I as TO make the occasion
noteworthy and 20 justify the state
ments OF optimism from the leadine
opeIa.ors. characterized as "cautiousn
by ele cf the leading independents.
The situation reminds one Pittsburgh
operator of free-for-alI horse race, in
wn.tA some of the entries, seeing the
big race ahead of them, make quick.
nervous starts and have to be called
hack bv the starters bell. The bust
ness is ahead, this manufacturer points
out and the race will soon be on and
every steel maker is anxious to -,
into it, but the lineup for the start is
not completed, There are lew things
to be adjusted.
One of Obstacles
The continued inability of the United
States Steel Corporation to manage a
reduction in wages without first cut
ting down selling prices is one Of the
obstacles. Steel consumers, estimating
that price cutting from this cause is
inevitable, are waiting. On the oppo-
site side the independent manufacture
ers, who cut prices in November but
have not yet cut wages, are beginning
to get inquiries from the consumer,
who wants to know how they can argue
against further price reductions if they
have been able TO operate ali these
weeks with prices down and wages up.
To this query the answer of the in
dependent manufacturer is that his
present operations are carried on either
at an actual loss or on d basis OF such
elaSsed as distinctly improbable. a
further complication faces the indie
pendents in the fact that the longer
they continue operating with low sell
ing prices and high wages the more
difficult il becomes to justify a wage
reduction to their employees.
The buyer Of steel commodities seems
warranted in his belief that the only
way out is further slight cut in selling
prices, followed by the necessary wage
adjustments Both sides are impatient
TO have this transaction concluded. The
action Of the Steel Corporation, when
1t comes, will be the determining
FACTOR. That action is coming from
this quarter before long is indicated
IN the uRquestioned falling off of bust
ness on the corporations books, as
expressed IN decreasing operations i'll
ITS mills. During the last week il il
estimated that operations in Steel Cor
poratlon mills have decreased fully 10
per cent, putting them to-day on about
an ~ per cent basis, as against 30 per
cent week ago.
See Final Readjustment
When the end of the string comes.
the steel manufacturers think, The final
readJustment of the industry will take
place, and take place swiftIy-so
swiftly, IN fact, that many consumers
VIII be caught with empty stock rooms
ana VIII have to take a place near the
tai end Of the long line Of buyers
IN front of the steel companies order
department windows Officials of
Dig independent interest in the Youngs-
town district see this possibility so
SIe1IIF S1eaF that they are advising the
Iade not to permit their stocks to he
come exhausted. or depleted to the
golht goii where inability to give PROMPT
ue'serIes later on may lead to loss
~ " Inconvenience. 1t is pointed out
saeI thefe IS heavy potential demand
which may become active at anv time
ana certainly when the public becomes
convinced that prices have reached
stable levels.
Important groups Of consumers. such
as the railroads, automobile and agri-
eaLlufai implement makers and con
s1ruc1ion interests have large unsa+-
lshed needs, steelmakers maintain.
uettlng them into the market is re-
59Eaeo largely as q matter of convine-
ang them that prices and other trade
SLondItlons are stable. There is also
neayy export demand. it is contended
WIZ wien foreign producers cannot satisfy
,'u - - Which Will swing more and more
49, 'hlS country as exchange conditions
arg restored to normal.
Stocks at Minimum
otocks Of producers are at min
mum, as they have shown no disposi-
"Vn 10 produce against future needs.
:. NeaoJustment Of wages is being held
-. aoeyance for the time being by rea-
S SSon oI the low operating rate and the
t@sSe @ that many operatives are either
%d @ie or are employed only part time
a"Aers ~ realize, however, that in order
" meet both foreign and domestic
eoempetItion they must get on a lower
ro Os1 oasis. To this end revised wage
a:eS nave been worked cut, but are
J1,ug temporarily withheld. Steel pro
a1gers IN England, Scotland, France
SO go Belgium have largely increased the
iiHciency of their plants and are ON
svu svetef competitive basis to-day than
An indication of the current i'm
tt.oYeo ta situation, which may be only
r,snpofary, of course, is the enlarge
Y' Yelt or operating schedules by
boungstown district interest which
saS tnlrty-four OF it's forty-four sheet
ch cHu tnplate mills, which are inter
e,lah nat hgeaole. active. Still another com
bb1ny states that it has refused enough
BUSINESS offered at cut prices to oner-
01oSe TO normal for two months.
Big Potential Demand
!, FfGHceeding on the theory that there
ts big overhanging demand for pipe
Vae interest is stockinp soma out,,1,+