Evening star. [volume] (Washington, D.C.) 1854-1972, 1930-12-29
TRADE RECESSION
DECLARED GENERAL
Quantity and Value of Raw
Material Exports Seriously
Affected.
BY o. X. DAVIS,
Secretary National Foreign Trade Council

Secretary National Foreign Trade Council
Foreign trade dropped off generally
throughout the world during the past
year both in quantity and in value. The
recession affected the countries which
export raw products and basic materials
much more severely than the countries
which deal mainly in manufactured
products. The United States has en-
tered the latter class of countries since
the war, and its sales abroad consist
now of about rs per cent of manufac-
tured products. Our position, thereforeH
has been in the middle ground. Our
exports have not fallen off proportion
ately as much as those of Japan, Latin
America, Canada, Australia, South
Africa and other countries which supply
the world with raw materials. But we
have suffered a substantially greater
loss. proportionately, than most OF the
countries in Europe.
For the first time in seven years our
exports have fallen below the S4,OOO,-
600 900 mark The figures for the year
1880 were close to that amount. while
DUR imports were little over S3000,-
100000, our lowest total since 1922.
Volume Equals 1926 Level.
That is not the whole story, however.
In quantity we did approximately as
much foreign business during the last
wear as We did in 1926. Our foreign
trade had a real value last year 80 3
per cent greater, with adjustments 10
standard prices, than it had in 1913.
That still represents substantial gam
over our pre- war position.
The real drop in our exports was
about Is per cent, making allowance
for the drop in prices. The correspond
ing decrease in the quantity of foreign
trade done by England shows little
more favorable situation that with us,
Englands recession being about 10 per
cent. Germany shows still more IA
vorable return on the year with fall
ing off in the quantity of her exports
of 5 per cent or less, while France, Rus
STA and several other European coun-
tries exported the same quantity of
goods as they did in 1929, or little
more.
Canada suffered more than we did
in the loss of almost 20 per cent in
quantity of her export trade, while
Australia, Brazil, Argentina and others
of the Latin American countries drop
ped of by between 20 and 80 per cent.
Agricultural Export Prices.
The extent to which basic food prod
uctS contributed to the falling of in
international trade during the year may
be judged by the fact that the unit
expert prices of our wheat and cotton
crops the bulwarks of our agricultural
foreign trade, dropped by 40 per cent
last year. Our farmers are receiving
farm prices about equivalent to those
they received in 1918 for the general
average of Our crops, and only tobacco,
lard and meat products appear in the
list of those of the agricultural staples
which we're exported last year in larger
quantities from the United States.
The most constructive factor of the
year is, however, that the manufac-
turing industry, particularly in Europe
and the United States, though reflect
ing the general reductions of prices, did
not substantially reduce the volume OF
its products entering international
trade The single exception is the au-
tomotive industry, whose exports, al
most 90 per cent of which comes from
the United States, dropped of during
the year almost by half from its 1929
record. The average diminution OF
other manufactured exports from the
United States by onlv per cent, cou-
pied with the ability of Europe to
maintain her own manufactured ex-
ports at practically the previous years
volume, shows that the greater part
of the years losses in foreign trade
was absorbed by raw materials. This
relatively steady market for the prod
ucts of manufacturing removes much
of the danger from the present situa-
ton and presages an improvement Tor
the near future.
Foreign Trade Well Organized.
In the last Is or 20 years American
producers and traders have made n
very considerable advance in the art
and science of merchandising in other
markets. Whereas 20 years ago our
foreign trade practice was joke to
the rest of the world. it is now, even
in the midst of present restricted mar
kets, better organized and better con-
Quoted than those of any other nation
II is, in fact. the standard of excel
lence in international commerce.
In looking forward to 1881 American
foreign traders are analyZing their mar
keis carefully and are preparing for
the increased volume of business that
is sure to develop. The resources Of
our credit as shown in the development
of American foreign banking branches,
on the one hand, and of the systems
initiated by credit departments of our
large manufacturers. on the other,
have been developed to a very better
high point of efficiency. Our services
of transportation and communications
are better than ever before. Our eX-
port departments are better trained
and are more at home in foreign trade.
In short. We possess advantages over
our position in the corresponding slump
in 1921 that are the result of nine
years hard work
Our export trade is like high-priced
automobile that is in perfect condition
and is ready to go, but is merely block
ed up by traffic jam. Just as soon
as the road opens we shall be able 10
take our accustomed position at the
head of the procession and there are
already indications that we are work.
ing out of the jam. Whether we are
at the end of the present depression
or no., the slogan. Greater prosperity
through greater foreign trade" is still
as valid as ever in impressing us with
the fact that a substantial foreign trade
is an indispensable part of our national
business policy.