Evening star., 1942-07-26
Steel Situation
Seen as Worst
War BottIeneck
Crisis SpotIiehted
By Higgins Cose
And Ineot Increase
BY FRANK MacMILLEN.


war production effort to date
now Is out in the open for every
one to look at.
1t Is steel, the basic material Of
all ornaments, and the events Of the
last week have brought into the
spotlight of general attention . sit
uation which industrial men have
seen growing for months.
Two things have made 1t clear,
even to professional observers
that a new phase Of the production
side OF the war has been reached: g
l. The Maritime Commission can.
celed a contract with q New Orleans
shipbuilder. Andrew jackson His-
gins, for 200 Liberty cargo ships-the.
largest single order OF the kind it
had ever placed-on the grounds
that steel could not be found to
complete the unfinished yard and
the ships.
2. The War Production Boards
iron and steel branch recommended
to Production Chief Donald Nelson
an increase of 10 per cent in the
annual steel ingot capacity of the
country to bring the total to about
100000 tons. (This country'x
steel-making capacity Is already
more than that of all the Axis and
conquered countries together.)
First Shortage Acknowisdgsd.
While scarcities OF individual com.
modities have from time to time de-
layed parts Of the war program, this
Is the first occasion on which a
shortage in an absolutely funda-
mental raw material produced In
this country has been acknowledged.
Steel, 1t IS pointed out, falls in q
class with fuel, domestic transporta-s
ton and electric power production
as the very basis of the war produc-
ton structure, and 1t Is the first Of
these in which shortage-or, Is
some steel men think, an apparent
shortage-has meant the stoppase
OF major piece of key war pro.
duction.
Observers here are not convinced
that the Higgins case In itself is
conclusive evidence on the question
OF = steel shortage, but they point
out that Mr.. Nelson and other Gov.
ernment authorities have been max,
ing 1t clear for months that the
actual supply Of basic materials was
reaching point where 1t promised
TO put . brake on production.
Industrial men not too close to,
the steel industry are inclined to re-
gard the steel situation IS . symp-l
tom of imperfect overall industrial
planning. They say plants to con-.
sumo steel have been built without
due regard to assuring the supply Of
steel to feed them.
Pin Hopes On .Purp."
Steel men, on the other hand
maintain that the, supply OF their
commodity is adequate for present.
and even larger. demand for war.
purposes II only 1t IS parceled out
properly among users. I.
The steel industry, Of course, has.
not had for months the responsible
tiles Of determining the use Of the
metal it produces. Steel Is allocated
to users by the War Production
Board and frequently the mills max
ing 1t have no idea for what user
1t is destined until given shipptng
instructions.
Steel men pin hopes for Z better
distribution Of the present supply Of
the metal on the Production Re-
quirements Plan which wa3 put
into effect at the beginning Of July,
and which, they say. gives the al
locating authorities, for the first
time, clear idea Of the eventual
end-use OF the steel which Is being
produced.
This plan, called "Purp" by the
steel crowd, II properly pursued
should prevent non-essential use
Of steel for civilian purposes, and
may even rectify what some steel
men regard as . needlessly lavish
expenditure Of the precious" metal
for certain military and semi-mili-
tary projects.
Trade quarters point out that a.
OOO. 600 tons of steel have been allo-
Gated for indirect military use," q
term which they are unable to de-
fine and which the Army and Navy
has not defined for them.
Plant Expansion 'sToo Successful"
They also make no secret Of the
fact they think too much Of current
production is being used for new
facilities which cannot be productive
for year or more, instead OF for
ships, planes and arms which can
be brought to bear Immediately on
the enemy.
Sample comment from the indus.
try during the week:
THE Governments munitions
plant expansion has been too sue.
cessful."
Whatever the outcome OF the
struggle to get more steel into the
war production, one result appears
inevitable-the squeeze will really be
put on civilian use of the metal
Such use last year Is estimated at
! about IA to 16 million tons; this year