Evening star., 1936-05-13
.STEEL MEN STUDY
PRICE STRUCTURE
Boost Unlikely Before June |.
Jump in Costs Laid to
New Laws.
BY the Associated Press.


NEW YORK, May 13.-"Labor agi-
tation, the granting of vacations with
pay to wage-earners and pending tax
legislation have focused the atten-
ton Of steel producers on prices"
says the Iron Age
Advances on many finished prod
ucts are naturally being considered,
but no important producer has deter
mined any definite policy on the
subject. 1t is certain that no decision
can be reached before June l and II
higher prices are announced at that
time consumers would be given ample
opportunity 10 cover their Summer
needs at current levels.
The experience of the industry
has proved that midyear price ad-
vances are not desirable. Demand is
invariably declining at that time and
even though orders can be sharply
stimulated during June by such action.
business suffers accordingly in July
and August. This occurred in 1884.
when the third quarter was one OF
the poorest in the industry's history.
A similar setback was suffered the
year before after the inception of the
n. r. A
Legislation Blamed.
"It is unquestionably true produce
ton costs are being increased by dis
criminatory New Deal legislation, but
the steel industry realizes only too
well that the laws of supply and
demand cannot be faunted by prac-
tiCal business policy, even though po-
litical expediency may lead TO any
sort of untried theory.
I'm the meantime. the trend Of steel
demand remains extremely encour-
aging. Ingot production has declined
only half point to 67l2 per cent Of
capacity, with output in many i'm
portant districts remaining un-
changed Raw steel is being accu-
mulated at few plants, but fin
ishing mill schedules are well sus-
tailed and mill baCklogS are Suffl-
ciently large TO prevent any sharp
decline in output for at least an
other month.
The automobile industry Is con-
tributing heavily to the maintenance
Of business, as now seems likely
that May assemblies will compare
favorably with the heavy April out
put. Some tonnage already is being
placed for June delivery, but parts
makers are curtailing their takings as
the first step in reducing inventories
in anticipation of model changes.
Freight Cars Ordered.
"Freight-car construction promises
to be an important factor in bolster
ing steel output against the automo-
tive decline The years car awards
have amounted to 1890 units, COM
pared with scarcely 1900 in the corr
responding 1885 period. Bids are in
on an additional $500 cars and in
quiries for another $500 are before the
trade. Thus car orders in the first
five months will total 25 900. or more
than in any full year since 1880.
Construction activity is less spec
/ tacular market factor. The weeks
/ fabricated structural steel lettings
| total $4,000 tons. compared with
/ 14,400 tons last week, while new in
quiries declined from 16,10O tons to
300 tons.
THE scrap market is a depressing
factor Declines in heavy melting
steel quotations at Chicago and Phil
adelphia have forced the Iron Age
scrap composite down Al cents gross.
to S1342, or sl.33 ton under the
years high level and only 9 cents
above the 1886 low. The pig iron and
steel composites are unchanged.