Evening star., 1922-09-20

west of the Mississippi. received today
in telegraphic reports from San Fran
cisco and Salt Lake City. These plans
indicate that the two companies will
dispute the markets of the western
United States and those Of the orient
tion and eastern independents.
Hitherto Independent.
These two mergers. which have been
formed under the names of the Pacinc
Steel Corporation and the Columbia
Steel Company, the first capitalized
for $40. 100000 and the second for 49,
100000, comprise hitherto entirely IN
dependent companies that have been
turning out steel for consumption In
programs OF each include the acqui-
sition and development of sources OF
raw material in Utah and they expect
by production Of raw material closer
to the mills and through reduced
freight hauls and rates and expansion
petition. effective in markets no"
| dominated by eastern manufacturers
Both companies announced TO-DAY
that they would begin at once the
construction of coking ovens and pig
iron furnaces in Utah. The Pacinc
| company is preparing to expend ~.
500, 900 Immediately in development OF
its raw material sources.
In the states Of Oregon, Washington
and California alone the annual sale
! of steel products exceeds $3OO,O00.-
900. OF this amount far-Western mills
have been selling only about $7O,OOO,-
900 worth.
Dominated by Freight Rates.
"The range Of steel manufacture on
the Pacific coast is entirely dorhi-
mated by freight rates." one of the
10
with the mergers declared today. AT
present all steel mills west of the
Rockies must pay freight on all raw
| materials and also Oh great portion
Of the scrap iron which they use
from points considerably east of the
ties Of raw materials made available
in Utah. the cut in transportation
costs will enable western producers
really to compete with big eastern
plants"
This steel man pointed out further
that population and industrial de-
Velopment has increased throughout
the far west to such a point in recent
years that even with largely expanded
western steel plants in operation
there still will be such an increased
demand for steel that eastern prod
ucts Will find a ready market.
See Markets In the Orient.
Ihe western steel men are taking
full cognizance in their plans of the
almost unlimited possibilities of mar
kets In the orient, and many far
sighted business, men on the coas,
predicted today that the prompt de-
Helopment of iron and coal deposits
in China by the leading eastern steel
makers might follow the activities OF
the western manufacturers. Quanti-
ties of Chinese raw material have
| been under control of big American
interests for many years.
Western steel fabricators declared
today that this new competition
might have an effect in eliminating
the pittsburgh plus" rate under
which they now have to buy their
semi-f1nished steel. Under this rate
which is now in controversy before
the federal trade commission, the
fabricator buys at the Pittsburgh
rate for steel plus the freight rate
from Pittsburgh to the point of pur,
chase, even though the steel may be
made in a mill in the same city
where 1t Is delivered.
Reports from widely scattered sec
tions today indicated that the tend
ency toward amalgamatlon is spread.
ing in scores Of other industries be-
sides steel. This portends at least
some effect on freight rates. on aver
age length of haul, eventually, and
on railroad revenues.