The Birmingham age-herald., 1924-01-29

natl0n TOT the post on the ground Cn so he resigned.
 add 10 the cost of the ore, but at the same time they increase it's unit value and reduce the smelting costs.
 "The element of transportation of into; nearly all pig iron manufactured in this country. A few small furnace units have for many years enjoyed switching rates from ore deposits in their close proximity, but the most mo- table exception is in the Birmingham district, where ores of medium iron content are so situated with relation to fuel and limestone that they bear relatively low transportation costs.
 In the production of coke the same line of reasoning applies. If the coke is made in beehive ovens at the mines it bears it's freight costs after it has been manufactured, but in the case of fuel manufactured in proximity to the furnace in by-product ovens it is ob- vious that there must be transported slightly more material than is in the finished coke.
 Tn beehive coke manufacture some Sooio iVi NAdmpiC, NNhoSC HI thC Soh- nellsville district-can be charged into the ovens without any preparation, while in other districts it is necessary to wash the fuel before it is adaptable for coking. This increases the cost of the fuel, not only from the labor re- quired in washing, but from the loss of material which has already borne a portion of the mining expense. In the case of the by-product operation it is the practice to prepare the coal by crushing it uniformly, and here again labor enters as an important item in the steps of preparing material from the ground for its practical use.
 Another factor of great importance is the ash content of the coke, as it follows that increase of ash over cer- tain limits is immediately reflected into the cost of iron manufacture.
 "In the case of limestone, the least | important of the raw materials, labor represents the major. portion of the cost at the quarry, while frequently the item of transportation is the limiting factor for its value as a Aux.
 '"The direct labor charges very nat uraly fluctuate with the changes which occur with wage rates, but at a mod ern plant these charges are relatively so low with respect to other costs that | they do not. change as materially as do the other charges. It is self-evident that such items as interest on invest ment, taxes and other direct overhead charges are fixed, and such variances as might occur would be brought about by increases or decreases in tonnage produced.
 ''The groundwork of blast furnace costs may then be built up from the foregoing remarks, and it will now be proper to discuss how the principal cost factors have pointed to a permanent in crease in the last decade. For the pur- poses of investigation, actual costs in the several districts would naturally be the most Illuminating exhibit. How ever, in order to get at the true condi- tiOns it would then be necessary to have average costs for each entire iron manufacturing district, as it may well be understood that individual figures cannot consistently be considered as truly representative of the whole. Ger. tain local advantages that one plant may have over its neighbor are nat. urally reflected in the cost sheet, and as it is not proper to exhibit conf dential figures, our purposes may be best served by taking certain well rec OgniZed average data in each case.
 An examination of numerous cost sheets of the several iron producing districts disclOses the fact that over a period of years the combined cost of the ores and fuel necessary to make ton of pig iron bears on an average about so per cent of the total cost. Recog. nizing this fact, it is possible to take l fVxY<, ,hE hn ch and use them as a basis of proof that pig iron costs have shown an upward tendency over the past decade.
 The iron production situation in Ala. bama is discussed as follows:
 .'The Alabama district is practically wholly self contained, in that the indi vidual operating companies do not de pend on independent mining companie, | for any of their raw materials. They do not even have subsidiary mining companies, but produce their raw ma terials themselves, charging the actua costs direct to the blast furnaces. II will. therefore, be understood that tho | furnace costs in the Alabama district are directly dependent on such fluctu atiOns of labor as occur from time tC time, whereas in the majority of the other iron producing districts raw ma terials are purchaSed either for a definite period or as fixed tonnage | In the Birmingham district the month | ly cost of the raw materials at the blast furnace will be dependent on the actual producing figures. In several cases the companies maintain their own transportation system, while others control short line railroads which de liver portion Of their raw materials but increased freight rates have had their effect on costs in the same pro portion as in other districts.
 Another very important feature Oi 1 this district in addition to short ! transportation haul is the fact that the climate of the region permits a continu ous operation throughout the year foI the mining industry. 1t is, therefore not necessary for the furnaces in this district to have large amounts of cap ital tied up in raw materials. This naturally is in direct contrast with those companies which have to figure interest on stored raw materials as a part of their fixed charges. Then again it must be taken into consideration that the basic wage scale is usually on very much lower plane in the south than it is in other districts. Ne gro labor predominates. and while it is possibly quite true that the turnover
 is much greater in the southern field yet the cost per hour has been well maintained considerably lower than ir other communities.
 Tt is an interesting commentary