New-York tribune. [volume] (New York [N.Y.]) 1866-1924, 1921-08-05
Coal Costs
Little Hope Of Anthracite Price Drop
languages

ping shortage Threatened
To the Editor Of The Tribune.
Sir: The writer, who is connected
with large, responsible coal company
in this city, notes with interest r. A.
Watson's question, in your issue of
august 2, to F. D. Underwood regard
ing the prevailing high prices Of an
thracite coal.
The public does not realize what
enormous costs are involved in anthra-
cite coal mining. The majority of pee
pie think that hole is dug in the
ground and that the coal is produced
at practically no expense. A mine pro
ducing 1000 tons of coal a day re-
quires 500 men. The mines are any
where from 500 to 600 feet deep. re-
curing tremendous pumps working
night and day, pumping thousands of
gallons of water and air. A large
amount Of timber is also required for
the props to prevent cave-ins, and va
rlous other necessaries, which add ma
terially to the cost of coal.
During the month of April, 1921, the
approximate cost of we'll managed
operating company for labor alone was
$3.50 a ton. The supply bill amounted
to $1.20 a ton, the royalties to the city
Of Philadelphia $3.50 ton and other
costs, such as taxes, both Federal and
state. general and compensation insur-
ance, interest on borrowed money, sala-
ries, etc, amounted to 60 cents ton,
making a total cost of IS for every
ton of coal produced.
Out of every ton produced 80 per
cent is small size coal and must be
sold at al average price of $3.50 ton,
which in turn should be figured to ad-
ditional cost on the egg, stovo, nut and
pea sizes. Then we have the exorbi-
tanc freight rates, which in some in
stances are higher than the price Of
the coal itself. The freight rate to,
say, Orange, N. j., is s2.66 a gross ton.
The cost of the coal and the freight
rate added amount to $106G a gross
ton f. o. b. the dealers coal pocket at
Orange, N. J.
The average cost of mining eight
years ago was about $3.50 ton at the
mines, compared with a ton cost of
So to-day. There is very little chance
for the price of anthracite coal to drop
before April /, 1922, at which time ex-
President Wilson's administration
agreement with the labor union ex-
pires.
From all indications and close OBJ
servation the writer believes that there
will be great shortage of coal this
winter If the public does not take the
advice Of the retailers and order its
supply now. According to statistics,
there is 100 per cent supply and 100
per cent demand for anthracite coal
large percentage of the mines to-day
are closing down, due to the lack of
orders. Some have been shut down for
several months, due to the HIGH cost
of mining, and others are only work
ing two and three days a week. This
condition is caused indirectly by the
people, who are holding off awaiting
lower prices and lower freight rates.
According to Mr.. Hoover's recent
statement, there is very little hope of
reduction In freight rates before the
first of the year. The public does not
realize that there is only about 80 per
cent Of the railroad equipment in con-
dition to handle the demand, and that
the people in the West and New Eng
land (who have also held off buving
Tor the same reason) will want their
coal before the lakes freeze over. and
that the snow and ice are a great him
drance to the railroads.
If the people do not soon wake up
and order their coal there is no ques-
ton but that there will be a very Sc
r1ous shortage which will result in
higher prices, due to the same old story
of supply and demand.
W. w. ALLAN.
Brooklyn Aug 3, 1921.