Evening star. [volume] (Washington, D.C.) 1854-1972, 1927-07-25
COSTS ARE LOWER
IN STEEL INDUSTRY
Official Figures Showing
Operations Under 1926 Held
Not Accurate Picture.
BY. j. c. ROYLE.

Special Dispatch to The Star.
NEW YORK. July 25.-The steel
mills are doing a slightly smaller bus
mess than year ago, according to the
formal figures which give activity In
terms of percentage of plant capacity
active. Actually. many wc;i informed
steel men maintain, the output Is
higher. Moreover. they say, costs are
lower and this will be reflected in earn
inGs before the year is over.
The optimistic outlook so expressed
Is supported by the present trend Of
prices. Prices of pig iron are rather
weak. but finished steel quotations are
showing strength and there is no sign
of approaching weakness.
The lowering of costs is due unqueS.
tionably to more improved methods,
new and better machinery and equip
ment and electrification of plants.
Moves along these lines have been uni
versal. The United States Steel Cor
poration has been active in improve
ment of both production and distribu-
ton methods. Production of blast fur
naces and other plants has been
stepped up until not nearly so many
units are necessary to produce Il re
quired tonnage as was the case five
years ago.
The Bethlehem Steel Co. now is
completing tremendous program of
expansion and improvement. When
this new work is fully functioning 1t
is expected to reduce costs and raise
profits appreciably. Youngstown Sheet
and Tube and many Of the plants OF
the Northern Ohio districts have bene.
fitted in equal proportion as have
those in Buffalo and Birmingham. Re-
public Steel, Carnegie Steel, Inland
Steel, Jones & Laughlin and Colorado
Fuel & Iron, are reported to be bene-
fitting.
Demand to Gain.
The production of new models in the
automobile field is deemed certain to
cause improvement in demand for
steel during August and September.
Some of this demand depends on the
way the new Ford car Is received, but
the manufacture of enough new Fords
to supply dealers with selling models
itself is sufficient to give the sheet
steel producers big boost.
Chrysler, WHY'S Overland. Hudson
and some other concerns are expected
to be in the market for appreciate
tonnages. Competition for this busi-
ness will be keen. The building indus
try is showing remarkable steadiness,
especially in public works construc.
ton.
In the Mahoning Valley 81 indie
pendent open-hearth furnaces and 80
sheet mills are operating this week.
compared with 80 open hearths and
100 sheet mills last week. Tin plate
production continues to be a bright
spot in the industry. with all the
Independent units under power. Strip
steel output Is practically at capacity.
Railroads are placing some orders
for equipment and rails, but this
business is coming in rather slowly.
Rolling mill operations are showing
some improvement. Despite the
declaration that there has been a
slight falling off in steel for the year
so far, pay rolls in most steel centers
are showing advances of to per
cent for the last six months as com.
pared with 1926.
The situation in the oil industry
does not lend itself to any increase in
the demand for oil country supplies
in general. but so long as the tre-
mendous volume of crude oil is pro
duced there will continue a demand
for steel storage materials and also
for a certain amount of pipe.
So far the coal strike has had no
appreciate effect on the steel indus
try, and is not likely to have for
some time, but no one can forecast
just what the fuel situation will be
in the fourth quarter. 1t Is possible
that it may be such as to cut profits
to a certain extent.