The Bozeman courier. (Bozeman, Mont.) 1919-1954, 1925-10-09
OF RUBBER
PRICES REACHED
Increase Since July, 1924, Over
1877 Per Cent-DecIine
Seems Likely

The spectacular advance in the
price of crude rubber during the last
few months has stimulated interest in
the operation of the Stevenson Re-
striction Act, which, since its adOp-
ton in 1922, has been one Of the chief
factors determining the position Of
the industry.
Between June, 1924, and July, 1925,
crude rubber prices increased nearly
~seven-fold. In the former month the
average New York price of ribbed
smoked sheets, a standard variety,
was below 10 cents a pound. Last
month a peak Of 1921 a pound was
reached. The greater part of this
advance has occurred in the last four
months.
The Stevenson Act provided for the
restriction of exports from British
territory to a certain proportion of a
STANDARD production based on the
actual performance of plantations in
the past, with an additional allow
ance for areas planted in the mean
time. If the price Of crude rubber
in any three months period averaged
above the economic minimum" Of Is
Sd (abOut S0h cents) a pound, the
expOrtable allowance for the following
quarter was to be increased.
If, on the other hand, the average
price was below this level, the allow
, ance was tc be reduced. Thus an at
! tempt was made to adjust supply to
: demand through the movements of
the price.
Stocks Too Low
The current issue Of the Guaranty
Survey, published by the Guaranty
Trust company of New York, says
that the lack of stability has admit
teddy been due in part to the conser-
vative buying methods Of American
manufacturers, whc are the chief
consumers of the raw material. And
it is probable, the Survey continues,
that the recent rise, no less than the
earlier decline, is traceable largely to
this cause. Apparently the stocks Of
crude rubber held by manufacturers
= were allowed to shrink to such an ex-
= tent that %large-scale buying became
# imperative.
1t is not likely, however, that any
great proportion of the imports Ct
9 recent months represents contracts at
anything approaching peak prices.
e If crude rubber prices maintain
ID their present level for a considerable
f. period, the prices, and hence the con-
Ie sumption, of tires and other products
may be affected in a marked degree.
I Such a situation, however, could not
continue long without automatically
s. bringing to an end the operation OF
J. the restriction plan.
The only contingency, therefore, in
which the price Of crude rubber can
remain at or near its present level
n for any sustained period is the in
crease in world demand to such a
point that a shortage exists v with
W the plantations producing and export
Up ing at full capacity.
p Under such conditions the price
le might remain high for several years
m until newly planted areas could be
~ brought into bearing. This, in the
long run, is the chief danger of the
plan. AS long as restrictions exist
- planting of new areas will be dis
c~1orseed. And the growth Of de
gnaS8 a. the point necessary to enc
lresk1sg&cD .aight easily be followed
by ae@5T&3 Of severe hardship
whats aae 9ees growing to the
@ productive stag.
a POssiRsa ResleIy.
" The advance III the price has again
} nwonh nuTmrI Aha lnnanIawr- sc Ahn
:, country, which consumes about three
al fOurths of the worlds output of rub
ay Der, upon foreign sources Of supply
ds Investigations have been made wit
Id a view to determining the possibilitl
Of rubber production in the Philip
pines, and eve in some sections o
re the United States. American manu-
facturers have in some cases acquires
ownership of plantations, and one o
Dr. the largest companies now produce
ID about % per cent of its raw material
be Another leading manufacturer ha
a leased about a million acres Of Ian
he from the Liberian Government, an
sn- expects to undertake the prOductio
ra- Of crude rubber on an enormOu
ult scale. In the meantime, experiment
ar are being made constantly to develo
EAR an economical process for producin
era synthetic rubber.
on. While these various projects do n'
an appear to offer any immediate tire,
cts 20 the present position of the Ea'
or Indian plantations, they may possibl
is be developed In time to provide
ms, valuable safeguard against futui
ess shorta9as.