San Antonio light. [volume] (San Antonio, Tex.) 1911-1993, 1923-01-01
STEEL INDUSTRY BUSY IN
1922 BUT PROFITS LOWER
AND CONSUMERS BENEFIT
Output of Producers Greater Than in Two Best Ton
mage Years of Before the War but Prosperity Is
Not Correspondngiy Large From Their
Point of View-Forecast for New
Year Difficult


the upward reaction that was naturally
que ON account of steel prices reach
ing a particularly low level. BY March
| pars, shapes and plates had reached
an open market quotation of 1.35 cents,
which was below the ten-year pre-war
average and below the average OF 1913,
while it was only about 80 per cent
above the level in December, 1914, the
lowest point in steel since 1898. Natu-
rally rebound was due, but the adj
vance was stimulated by the obvious
difficulty the steel mills had in Operat-
ing.
Men have talked and acted as if the
settlement of the coal strike in August
by the Cleveland agreement gave the
United Mine Workers an advance. Of
course it did not. 1t gave them a
continuance of a very high wage scale,
which the great majority of observers
had expected would be reduced. The
market price of union mined coal, how
ever, was very high after the resump-
ton of mining. Furthermore, there was
a wage advance in the Connellsville re-
gion late in August of between 40 and
80 per cent by restoration of the scale
of September l, 1920, from which there
lilu DtCh III AN-A
High Fuel Costs.
Thus the steel industry was left with
very high fuel costs, and steel prices
advanced further on this account. The
development was very unpleasant to
steel producers and steel consumers
alike. Throughout 1921 the cry had
been for liquidation of costs, and a
great deal was accomplished. Labor
in the steel industry became efficient
again, and a bright prospect was Gre
ated that steel could be made profit
ably at moderate prices, such as would
stimulate demand. This condition was
greatly altered. There was the higher
cost of purchased union mined coal,
the much higher wages in the Connells-
vile region, together with continued
strike expense, for the United Mine
Workers have endeavored to this date
to keep the Connellsville strike alive
and there was the general wage ad-
vance at furnaces and mills of Sep
TENDER ], influenced in part by the new
labor conditions.
How disturbing the conditions were
may be shown by citation Of the
United States Steel Corporations
earnings in September. Production
was still restricted as fuel supplies
we're not fully restored. Wages had
lust been advanced. Steel prices i'll
the open market were higher than
had been hoped for at the beginning
Of the year. but there were old or
ders. taken at low prices, but executed
with greatly increased costs. The cor
| poratiOn's earnings per ton in Septem-
Der were in the neighborhOod OF $3.50
/ What thst means, from the long range
| viewpoint may b seen when II is re-
called that in 1905. when the corpora.
! ton was FIVE years Cd Il ran az lVJ
Der cent Of capacity throughout the
| year and made q new record IN earn,
| ings. but II its earning per ton had
been $3.50 il would have earned only
about half as much and would have had
almost nothing for the common stock
Yet steel prices. in the open market
were 80 per cent higher last September
than in 1906.
Effects Of Coal Strike.
Thus the coal strike affected de
mand, production, prices and profits
There was time, when the cog STRIKE
was two or three months old, that somt
men quietly remarked that perhaps thu
coal strike was a blessing in disguise
Ii had stimulated demand and it facill
tated the recovery in steel prices. Wher
il forced the industry TO fill at higl
costs orders that had been taken a
low prices. and left the industry witt
much higher costs at the end OF IN
year than at the beginning, 1t make
the case quite different.
A weighted average OF prices o
! finished steel products stands at ID
cents a pound at the present time
| against 2.OG cents at the low poin
early in March. 3.2j cents at the I'm
!, dustrial Board" prices of March Il
. 1913: $50 cents under the government
wartime control, and 1.SO cents a
! the ten-year pre-war average.
The character of industrial activlt
in 1922 was plainly shown by the dis
! tribution of demand. 1t was goo
! year. n decidedly good year, from tn
moderate viewpoint men are now dis
t pOscd TO hold. in railroad demand a
to car and locomotive material an
rails and track supplies. while Their
was little railroad buying in the mat
> Ter of bridges and terminal work. TIL
, demand for steel for skeleton steel cor
L. struction, for hotel and office build
ings. was rather moderate in the frs
: eight or nine months Of the year an
\ tapered to very modest proportion
e later.
I Effects Of Building Boom.
= There was a truly remarkable d.
mand practically throughout the yea
! for the smaller sizes of steel pine an
= for wire nails, this being a reflectio
|, Of the great boom in garage and dwell
ing house construction. When the tin
of inclement weather arrived and sue
Il construction work would be expected
q be relatively light. the pressure upo
II the mills for delivery Of nails and PHI
J. was practically undated.
q The automobile industry's demar
= for steel was good. but the autOmobi
l. industry has never taken any larl
q proportion OF the steel output, new
= as much as 10 per cent. 1t shou
I. be noted that statistics of the numb
II of automobiles produced are apt to
l. misleading if allowance is not ma,
n for the continually decreasing avera'
{" weioht. due TO the greater prOportiC
Is Of Fords as well as of Cheyrolets al
u other light cars.
10 The oil industry took fairly lar
1t tOnnages Of tubular goods in the fir
70 half of the year. With the great d
m cline in oil prices at the middle of 4
Is wear the prediction was commonly ma
~ that practically all drilling except Oi
l. setting would be discontinued. but the
ie remained a moderate demand for {
country goods throughout the year.
n. The agricultural implement make
"a were decidedly moor buyers of steel
& 1922, although their purchases increasr
~ rather we'll in the last three or fOr