The Iron Age 1914-01-01: Vol 93 Iss 1

ANNUAL REVIEW SECTION | IRON ACE | Established 1855 New York, January 1, 1914. Vol. 93: No. 1 A Year of Sudden Reverse in Iron and Steel Features of the Trade of 1913—Reports from Leading Commercial Centers—The Sheet and Tin Plate Trades—Lake Superior Ore ‘Trade GENERAL REVIEW OF THE YEAR’S BUSINESS A year of blight—this is the epitaph to be writ- ten on the tombstone of 1913. Opening with the most buoyant activity ever known in the iron trade, the whole industry being crowded to its utmost, the year ended with numerous idle plants, operations of steel works being at barely 50 per cent. of the pro- ductive capacity and the number of active blast fur- naces the smallest since December, 1911. Probably never before has the trade seen such a complete change from insatiable demand to almost no inter- est among buyers, except in years of a financial panic. Lacking such a reason for the great decline in business, the change has been in the nature of a blight, which first attacked the pig-iron trade and then spread from one to another branch of the steel industry. The characteristics of the year were thus: 1. Excessive demand in the first three or four months. 2. Continuance of a high rate of produc- tion for at least six months after buying had been sharply checked. 3. Tremendous shrinkage in pro- ductive operations in November and December. UNFAVORABLE GENERAL DEVELOPMENTS Outside of the iron trade, the developments of the year were so preponderantly unfavorable that one can but marvel that the depression in the Ameri- can iron business did not set in much sooner. The Balkan war, which had upset European financial calculations and caused purse strings to tighten on this side of the Atlantic, was a heritage from 1912 when 1913 began a new page in history. The peo- ple of the United States had voted in 1912 to rein- state in national power a political party that was known to be determined as speedily as possible after March 4, 1913, to reverse the fiscal policy to which the business interests of the country had been accustomed for a half century. In March unprece- dented floods ravaged one of the richest sections of the Middle West, destroying many lives, wiping out of existence much valuable property and annihilat- ing for a considerable period all means of communi- cation, with a total loss in money value approxi- mating as a catastrophe great historical fires and earthquakes. Late frosts in the spring months did far more damage than usual to fruits and vegetables in many States. In August and September the great corn belt was afflicted with continuous pitiless heat and a protracted drought that destroyed almost all vegetation in that important section of the coun- try and caused a partial failure of the corn crop. And to add to all these unfavorable occurrences Con- gress was in session from early in the spring, slowly and tediously considering details of tariff revision, with disturbing rumors of drastic cuts in duties. From April to October the country was in a state of uncertainty over the tariff, business men gener- ally hesitating to make commitments which might prove highly unprofitable upon the promulgation of the exact rates and the fixing of the date for the new tariff to go into effect. HIGHLY PROSPEROUS CONDITIONS WHEN THE YEAR OPENED The railroads contributed largely to the prosper- ity of the iron trade in the early months of 1913. They had placed heavy orders for cars, locomotives, rails and other supplies late in 1912, and the re- sultant demand for steel came on top of a large con- sumption by implement manufacturers, automobile builders, structural shops, ship yards, bridge build- ers and other fabricators of iron and steel into fin- ished forms to meet the requirements of a busy and then prosperous nation. So great was the demand for all classes of steel products that the largest steel makers were gorged with contracts which apparently mortgaged their entire output well into the third quarter of the year. Premiums were readily obtained by those manufac- turers able to slip in an occasional order for early shipment. All finishing mills were operated at such a gait that the supply of semi-finished steel fell con- siderably short of the demand, and mill operations were from time to time checked on that account. Shipments of steel billets were made in large quan- 2 THE IRON AGE tities from works in eastern Pennsylvania to finish- ing mills in the vicinity of Pittsburgh. Even the largest mills of the United States Steel Corporation were unable to produce sufficient steel to satisfy their requirements and were obliged to buy billets and sheet bars from outside manufacturers. The pressure for semi-finished steel was so great that the construction of not less than 3,000,000 tons of new open-hearth steel capacity per annum was being hurried to completion, although but a year before the belief had been widespread that the coun- try’s steel-making capacity was more than 6,000,000 tons in excess of any probable requirement that could be foreseen. The demand for steel bars was extraordinarily heavy, running much in excess of the capacity of the mills, and iron rolling mills reaped a harvest. Consumers of bars, to a consid- erable extent, were obliged to turn to the use of iron bars to fill their urgent necessities. Iron rolling mills which had long been idle were rehabilitated and put in operation. A feature of this condition of business was the heavy demand on stocks carried in iron and steel warehouses, which had to be drawn upon, even at very high prices, by consumers who were in need of immediate supplies. The enormous demand for steel products was responsible for the great activity of blast furnaces. The production of pig iron, which had been steadily growing since July, 1911, when 57,841 tons per day of coke pig iron was being made, culminated in Feb- ruary, 1913, in which month an average of 92,369 tons was turned out. At this time the total output of pig iron was at the rate of 34,350,000 tons a year, much above the highest production ever reachéed in any previous twelvemonth. Prices of steel products, which in the latter part of the previous year had been considerably below the level of European prices, advanced in the early months of 1913 to a higher rate than in Europe. The largest steel companies endeavored to check the rising tide by continuing to quote reasonable prices for delivery several months ahead, but a time was finally reached when they could only take such con- tracts “to be delivered at the convenience of the mill,” and buyers in urgent need of material were compelled to turn to the smaller establishments and pay much higher rates. A noteworthy feature of the year was the almost continuous decline in the price of scrap. The sup- ply at all times appeared to be much in excess of absorptive capacity of steel works, rolling mills and foundries. The demand for coke expanded, of course, in proportion to the activity in the pig-iron trade, and prompt furnace coke sold at this time up to $4.25 per net ton at oven in the Connellsville region, while contract coke freely brought $3.25. THE FIRST APPEARANCE OF WEAKENING Weakness in pig iron began to manifest itself in January, as the steel companies having blast fur- naces appeared to be able to satisfy their own de- mands and were not drawing on merchant furnaces. The foundry trade was not equal to the absorption of the production of these furnaces. This weakness extended further in February when the huge pro- duction of pig iron proved to have outrun the coun- try’s needs. In March the sellers of pig iron be- came anxious for business and much larger transac- January 1, 1914 tions were recorded than earlier in the year as the result of a lowering in prices. The manufacturers of agricultural implements, who had found the steel-bar mills unable to supply their requirements in the latter part of 1912, began to inquire for bars in February, which was much in advance of their usual time for placing season con- tracts. From that time until late in the spring such contracts were placed at various intervals, but the bar manufacturers generally refused to take these contracts for an entire year, restricting them to six months. In the second quarter of the year premiums on finished products shrank notably, notwithstanding the fact that the demand for billets and sheet bars continued to exceed the supply. About this time weakness began to develop in sheets, the very great increase in productive capacity beginning to make itself manifest. The floods in the Middle West, which stopped operations in a number of sheet mills, checked the decline, but their influence was only temporary and the downward movement continued steadily for the remainder of the year. Much unfavorable comment was heard about the general condition of trade, but the finishing mills, especially the bar, plate and structural mills, were well booked and the rate of production kept up to full capacity. Great scarcity of labor had made itself manifest, due to the heavy demand for workmen for all kinds of outdoor employment, and manufacturing estab- lishments found themselves put to much trouble in endeavoring to keep their forces at maximum. Quite a number of strikes occurred, following de- mands for higher wages. In addition to strikes of common labor, some troubles broke out among the molders in several cities and the machinists at Buf- falo. These strikes caused considerable inconveni- ence at the time, but were usually settled at slight concessions to the men. THE THIRD QUARTER BRINGS A PIG-IRON MOVEMENT At the beginning of the second half of the year the outlook for large crops in this country was ex- ceedingly promising, the Western drought not hav- ing begun, and business sentiment improved, not- withstanding the fact that European trade condi- tions had become decidedly bad, while financial con- ditions had grown worse. Premiums for prompt shipment of finished products, however, disappeared, showing that new business was not being received by American mills in sufficient volume to promise the continuance of the high rate of production that had marked the previous months. At this time also tariff revision loomed up more largely as a disturb- ing factor. Pig-iron prices had receded to such a point that buyers were tempted, Southern No. 2 foundry going as low as $10, Birmingham, and a good buying movement took place in July. Notwithstanding the better demand, the restriction of pig-iron produc- tion, which had been proceeding for some months, was not checked but furnaces continued to be blown out. The Connellsville coke producers endeavored to peg the price of furnace coke at $2.50 per net ton, at oven, in the hope of checking a decline, which was becoming quite pronounced with the lessening demand from iron makers. While no weakening occurred in contract prices of steel bars, plates and January 1, 1914 apes, prices of wire products and sheets declined ‘ite sharply. The buying of pig iron became so heavy in July id August as to lift prices from $1 to $1.50 per ‘on above the lowest point touched. About this time, however, in sharp contrast with the pig-iron -ituation generally, forced selling of Lake Superior harcoal pig iron at prices below the level of coke ron occurred in the West, which it subsequently developed was due to the, reorganization of a large naker of that grade of iron. In August and September steel billets and sheet pars became much more plentiful and prices re- eded, as new open-hearth steel capacity began to make itself felt. Plates and shapes sympathized with the movement in semi-finished steel, and prices if these products were shaded. The steel-bar trade, however, continued in excellent shape, the bar mak- ers being able to get full prices. A contest of endurance which had been on be- tween the coke producers and the furnacemen was ended in September when some of the Connellsville producers began to sell coke on an independent basis at cut prices. THE STEEL TRADE DECLINES RAPIDLY In the latter part of the third quarter the steel market presented a different aspect from the pig- iron market. Steel prices steadily sagged while ANNUAL REVIEW SECTION pig iron maintained its strength under the influence of the buying movement which had begun in July and continued rather actively until September, coupled with the restricted output. In October, the month in which the new tariff act went into effect, complaints of slackening busi- ness were heard in every direction. While some rail buying in the West for 1914 was reported, business in all other finished lines fell off. Prices of sheets receded so much that makers were com- plaining that they had but a narrow margin of profit. Sharp competition developed in plates. Steel bars felt the effect of less trade, and conces- sions were made on contracts. Pig iron began to weaken again. The decline in business was heavy in November. Prices of pig iron fell steadily, and numerous fur- naces were blown out. Operations of steel works were greatly restricted, numerous plants running only on part time. While no sales of foreign iron and steel were reported, low quotations were being received in numerous quarters and these quotations undoubtedly had their influence on buyers, who held off in the expectation that domestic prices would eventually go still lower. At the beginning of December the rate of production of pig iron was down to 26,500,000 tons a year, and the production of steel ingots was estimated to be about 50 per cent. of the steel making capacity of the country. The Pittsburgh Iron Trade in 1913 BY ROBERT A. WALKER The year opened with prices high. Bessemer pig iron was selling at $17.25 and basic about $16.25, both at Valley furnace; steel billets for prompt shipment, $28 to $29; Bessemer sheet bars, Pittsburgh, $29 and higher; merchant steel bars for forward delivery, 1.40c., and for prompt delivery, 1.70c. and higher; plates, 1.50c. for forward deliv- ery, and as high as 1.75c. for prompt delivery; beams, 1.50c. for forward shipment and 1.75c. and higher for prompt delivery; No. 28 black sheets, 2.35¢.; No. 28 galvanized sheets, about 3.50c., and other articles of finished iron and steel proportion- ately high. The mills were filled with orders and not in position to make prompt shipments, so that consumers, when they could find a mill that could make deliveries wanted, were practically forced to pay whatever prices the mills quoted. These condi- tions continued until along in May and June, when a material slowing down in new business occurred. The mills were catching up on back deliveries, and gradually the large differential in prices for prompt and forward delivery were disappearing. By Sep- tember, prices for either quick or forward delivery were practically side by side. The output of all kinds of iron and steel in the first six months of 1913 was at a record breaking pace. Early in July the local situation was ma- terially affected by the failure of the First-Second National Bank and the appointment of a receiver for the American Water Works & Guarantee Com- pany. Runs of two or three days on several large banks in this city followed, and for a time it was feared there would be a repetition of the financial trouble of 1907, but happily this was averted. How- ever, consumers were commencing to lose confidence and were declining to make contracts ahead, and in some cases were holding up specifications on con- tracts placed earlier. The summer months were extremely dull, but there was general expectation of a good buying movement to start about September after the hot weather and the summer vacations were over, which was not fulfilled. There was a slight flurry in the pig-iron market in September. In the last half of 1913 new buying was almost at a standstill, the mills running largely on old contracts. In the first seven or eight months of the year there was a decided shortage in the supply of steel, and premiums were paid by sheet and tin plate mills and other users to get prompt deliveries. Billets sold as high as $29, and sheet bars as high as $30 for prompt shipment. Of course, consumers having regular contracts with the steel mills were getting their steel at lower prices. There was a gradual decline in the last three or four months of the year in prices on nearly all kinds of products, pig iron declining $2 to $3 a ton, steel billets and sheet bars $6 to $7, beams and channels $5, plates $5 to $6, steel bars $4 to $5 and sheets $6 to $8 a ton. These declines in prices did not bring about any increase in buying, but on the con- trary had the effect of causing consumers to hold off still more, and in the last three or four months of 1913 buying was only for current needs and in small lots. There was a marked contrast in the action of the mills in handling the situation in the last half of 1913, as compared with the depression in the early part of 1911. In that year the mills en- deavored to run full and sold their products at ex- tremely low prices and for long periods of delivery. In the depression of 1913 the mills adopted the re- * verse course, cutting down production and declining to take contracts for long delivery. In December the output of steel in the Pittsburgh district was not over 60 per cent. of productive capacity, while finishing mills were not running over 50 per cent., and in some lines were operating at a less rate. The year closed with conditions in the steel trade extremely dull, but with a hopeful feeling that the early part of 1914 would show material betterment. It was believed that the passage of the currency bill would help to clarify the situation, and should the railroads be allowed the 5 per cent. advance in their rates, for which they have sought permission, it would also improve matters. In the second half of last year, purchases by the railroads were only nominal, the demand for steel cars and track mate- rial having been light. There was a surplus of labor at the close of the year, in sharp contrast with the first part of 1913, when there was a decided scarcity, common labor commanding as high as $2.50 per day. PIG IRON The year opened with prices of pig iron ruling high and production at maximum rate. In Janu- ary, Bessemer was selling at $17.25, Valley furnace; basic, $16.25 to $16.50; No. 2 foundry, about $17.50, and gray forge, $16.25. The weakness in other sec- tions in February was stubbornly resisted in this district, but prices began to crumble in the spring and went down steadily until the close of the year. In July, Bessemer was selling at $15.75, a decline of $1.50 on January; basic, $14.25, a decline of $2; No. 2 foundry, $14, a decline of $3.50, and gray forge, $13.25, a decline of $3. In December, Bes- semer was nominally $15, but had there been any demand it could have been bought at $14.50 or less. Sales of basic were made in December as low as $12.75; No. 2 foundry, $13.25, and gray forge, $13. There were some notable additions to pig-iron capacity in the Pittsburgh district in 1913. The Pittsburgh Steel Company completed the building of two large blast furnaces at Monessen, Pa., with a combined daily capacity of about 1000 tons. The Youngstown Sheet & Tube Company added a fourth furnace at Youngstown, Ohio, with a daily capacity of 500 tons. The Republic Iron & Steel Company, Youngstown, increased its pig-iron output by the rebuilding of several furnaces. The furnace of the Clinton Iron & Steel Company in Pittsburgh, which collapsed early in the year, was rebuilt and put in operation in December on foundry iron, with a capacity of about 350 tons a day. At the close of 1913 there had been a sharp restriction in pig-iron output, the Carnegie Steel Company having but 28 furnaces out of 58 in blast, and other large steel concerns having only part of theirs running. The outlook is that pig-iron output will be still further restricted early in 1914. The following table gives the average monthly prices for the year of Bessemer, basic, No. 2 foun- dry and gray forge iron, f.o.b. Valley furnace, to which 90c. per ton should be added for delivery in Pittsburgh: Average Pig-Iron Prices, f.o.b. Valley Furnace in 1913 No. 2 Bessemer Basic foundry Gray forge SET. 5 kk cc we . $17.25 $16.41 $17.50 $16.25 POTURLY .civtvess 2a 16.30 17.00 16.25 ee ae . 29.26 16.11 16.69 16.02 PEE a seni dine pslec, aoe 15.87 15.55 5.27 | 16.80 15.15 14.62 14.27 Pe is ciaascanies 16.24 14.50 14.06 13.81 eae ae Anes ; a re 14.37 13.87 13.65 WG: wb Gar sk Cae 15.62 14.06 14.00 13.35 September ........ 15.75 14.00 14.00 13.35 CRRGDOR is ioc civicen 15.70 13.90 13.84 13.36 November ........ 15.12 13.09 13.50 13.35 Deceiver 16 is eces 14.87 12.71 13.50 13.05 THE IRON AGE January 1, 1914 STEEL BILLETS During the year 1913 extensive additions were made to open-hearth steel capacity in this terri- tory, but there was no new Bessemer construction. Taking the plants of the Carnegie Steel Company at Bessemer, the Youngstown Sheet & Tube Company at Youngstown, the Pittsburgh Crucible Steel Com- pany at Midland, the nearly completed plant of the Brier Hill Steel Company at Youngstown and a few additions to old plants of one to three furnaces, it is estimated that the increase in open-hearth yearly capacity in the Central West in 1913 was at least 2,500,000 tons. The year opened with the steel market very active, all makers being much behind in shipments Consumers were forced to pay premiums to get rea- sonably prompt deliveries. In January Bessemer billets were selling at about $27.50; open-hearth billets, $28.50; forging billets, $35; Bessemer sheet bars, $28, and open-hearth sheet bars $29, for prompt shipment. The market continued active up to May, at which time the mills began to catch up on deliveries, as the supply of steel had increased. In the latter part of June the consumers that were being supplied on contracts were advised that the price of billets for the third quarter would be $26.50 and for sheet bars $27.50, Pittsburgh or Youngs- town mill. With the slowing down in operations among the finishing mills that started in the second half of the year the consumption of steel fell off materially and prices declined rapidly. In Decem- ber the price of both Bessemer and open-hearth billets was $20, and Bessemer and open-hearth sheet bars $21 at maker’s mill, showing a decline of $7 to $8 a ton from the high prices in the early part of the year. STEEL RAILS Operations at the three Edgar Thomson rail mills of the Carnegie Steel Company at Bessemer, Pa., were fairly active in 1913, especially in the first half of the year. Much of the foreign rail business secured by the United States Steel Products Com- pany is rolled at the Edgar Thomson works, and this helped largely to keep the mills going. The addition of an open-hearth plant to the Edgar Thomson works, thus enabling the company to make open-hearth rails there, also helped to keep the plant more fully employed, as previously it had been the custom of the company to roll all open-hearth rails at its Ohio works at Youngstown. The price of standard section rails was maintained through the year at $28 per gross ton, and prices of light rails were also well maintained, the demand being good throughout the year, especially from the coal min- ing interests. STRUCTURAL MATERIAL The demand for structural steel was heavy for the greater part of 1913. The year opened with beams selling at 1.50c. for forward delivery and 1.75c. for prompt shipment. There was a great scarcity, all the mills being much behind in deliv- eries, and consumers paid premiums of $5 to $6 a ton for reasonably prompt shipment. This condi- tion continued until April, when a slight slowing down was noticed, and the price for future delivery declined to 1.45c. In the early part of September the market was weak at 1.40c., and premiums for prompt delivery were disappearing, as the mills were catching up on deliveries. By October pre- miums had disappeared. The market declined steadily until December. Then sales were made at 1.25c., with some reported as low as 1.20c. The structural mills were pretty fully employed for the first nine months of the year, but in the last quar- J nuary 1, 1914 they were unable to operate at more than part pacity. The year closed with the steel fabricat- x interests having a fair amount of work on their ks, but that placed in November and December is extremely light and competition was keen. STEEL PLATES The demand for steel plates in the first nalf of 113 was enormously heavy, all the makers being aded with business for three or four months ahead nd much behind in deliveries. Premiums of $6 a ton or more were then paid for prompt shipment. he year opened with steel plates selling at 1.50c. for future delivery and 1.75c. and higher for prompt elivery. These prices were maintained until March, when a decline of about $1 a ton took place, the new demand having fallen off to some extent. In the last week in August another decline of $1 a ton took place, and premiums for prompt deliveries began to disappear, as the mills were catching up on deliveries. From this time until the end of the year prices declined $4 a ton or more. In De- cember 14-in. and heavier plates sold at 1.20c., and some business was placed at 1.15c. In the last quar- ter most of the mills were operating to about 50 per cent. of capacity. IRON AND STEEL BARS The demand for iron and steel bars in the first half of 1913 was extraordinary. The year opened with steel bars selling at 1.40c. for future delivery and as high as 1.70c. to 1.90c. for prompt delivery. Iron bars at this time were 1.70c. and hard to ob- tain for prompt delivery. In May and June the new demand slowed down and at the end of the year was very dull. Prices on both iron and steel bars materially declined in the last half, and at the close of December steel bars were 1.20c., with sales reported at $1 a ton less. Iron bars were quoted at about 1.35c., Pittsburgh mill. Iron and steel bar mills had little business ahead at the close of the vear. SHEETS At the opening. of. 1913 specifications against contracts were much in excess of the output, with a continuously strong new demand, so that the mills were getting steadily further behind in deliveries. In the early part of January No. 28 Bessemer black sheets were firm at 2.25c., and No. 28 galvanized 3.40c., consumers paying premiums over these prices for prompt shipments. In the early part of March No. 28 Bessemer black sheets were 2.35c. and No. 28 galvanized 3.50c., with the mills from 8 to 12 weeks back in deliveries. In June the new demand began to slow down, and large consumers were not taking out sheets promptly on their contracts. In the early part of July prices weakened and in the last three months of the year materially declined. In the last week in December No. 28 Bessemer black sheets were selling as low as 1.85c. and No. 28 gal- vanized 2.85c. The mills, however, were refusing to book contracts for forward delivery at these prices, believing that early in 1914 the sheet market would mprove both in demand and in prices. TIN PLATES This trade was only fairly satisfactory in 1913. In January the price of 100-lb. coke plates was 53.60 and 100 Ib. ternes $3.45, but tin plate was ing sold at about 10c. under. In the latter part f March a heavy flood visited western Pennsyl- ania and eastern Ohio, and a great many tin mills vere put out of commission for upward of two veeks. This made a material reduction in output, vhich helped the market. In the summer specifica- ANNUAL REVIEW SECTION 5 tions against contracts were dull, and all the tin plate mills began to run short of work. In July the Amalgamated Association declared a strike at the Pope works of the Phillips Sheet & Tin Plate Company at Steubenville, Ohio, which had refused to sign the scale. An effort was made by the com- pany to run the mill on the open shop plan, but this was abandoned, and the plant was closed down and is still idle. In August there was a decline of about 10c. per box, 100 Ib. cokes being freely offered at $3.50 and 100 lb. ternes at $3.45 per base box, and the demand was dull. On November 4 the American Sheet & Tin Plate Company announced its price on tin plate for 1914 on the basis of $3.40 for 100 lb. cokes and $3.30 for 100 lb. ternes. These prices were obtained for a large tonnage of tin plate for delivery during the year 1914, but to some of the largest consumers the usual differentials of 5 to 10c. or more under these prices were allowed. At the close of the year the tin plate mills were operating to only about 50 per cent. of capacity. MERCHANT PIPE From the standpoint of sustained demand the year 1913 in the iron and steel pipe trade was prob- ably better than in any other line of finished prod- uct. In the first half of 1913 all the mills operated to their utmost capacity and were much behind in deliveries. In the second half there was a slight slowing down, but not as much as in other lines. The year 1913 was one of the best ever known in the pipe trade, and the outlook for the new year is re- garded as fairly good. IRON AND STEEL SCRAP In January and February prices were fairly good, heavy steel scrap selling at the beginning of the year at $15, and other grades proportionately high. In May and June, however, the demand be- gan to slow down, and for the last six months con- ditions were bad, with prices on some classes of scrap lower than ever known in the history of this trade. At the close of the year selected heavy steel scrap was seling at $11. The following table shows the average monthly prices of a number of classes of scrap, averaged from weekly quotations in The Iron Age: iverage Old Material Prices, Gross Ton, Pittsburgh, in 1913 Ma- chine Heavy No.1 Bundled Re- Cast shop steel foundry sheet rolling iron turn- scrap cast scrap rails borings ings January ; $14.95 $14.50 $12.75 $16.35 $10.13 $106.50 February : 14.12 14.50 11.39 16.25 10.06 9.37 March ...... 14.18 14.25 10.62 16.25 10.00 8.50 BOGE. nn ven cee: - 26e 14.25 10.35 16.05 10.15 8.00 i ~<cscaee . Sa 13.62 9.50 14.87 9.25 7.69 0 ae 12.62 12.87 8.69 14.50 8.37 6.62 Pen newest ve 12.40 12.7 8.50 14.50 8.25 6.5 August ..... 12.37 12.75 8.25 14.50 8.25 6.75 September ... 12.25 12.7 8.00 14.25 8.19 6.94 October ..... 11.85 12.35 7.15 13.45 8.10 6.95 November ... 11.44 12.00 6.56 13.42 7.25 6.50 December ... 11.08 12.00 6.50 13.45 7.25 6.50 COKE The coke trade in the first half of 1913 was very satisfactory, prices ruling high and the demand be- ing heavy, owing to the unprecedented activity of blast furnaces. In January standard makes of furnace coke for spot shipment were selling at $4 at oven and higher; on contracts, at about $3.25 per net ton at oven. These prices, however, were not. maintained long, as in April best grades were selling as low as $2.25 and there was little doing in contracts. In the third quarter the operators en- deavored to maintain a price of $2.50, but were un- Ae Nea. eee Sh > Filierue* > - a in ee es —, fe pe hee a te = es) I Pet Te be at col a E9 ate / ies. Ar - e yee. a ee en THE IRON successful. Some sales were made at this figure. prices being guaranteed against decline, but in the last three months of the year prices steadily de- clined. At the close of December best grades of furnace coke for spot shipment were selling at $1.75, and contracts for standard grade furnace coke for first half of 1914 were made as low as $1.80 and up to $1.90 per net ton at oven. The following table shows the average monthly prices per net ton at oven on prompt and contract furnace and foundry coke during 1913, averaged from weekly quotations in The Iron Age: AGE January 1, 191 Average Monthly Prices, Per Net Ton at Oven, of Connell ville Coke in 1913 Prompt Contract Prompt Contra: furnace furnace foundry foundr coke coke coke coke January ........ $3.88 $3.19 $4.40 $3.62 February 2.5 2.62 3.25 3.25 3.00 3.00 August September October November December + 4 DO BO bo DO bo bo be fo oworwurnrwnwnc eonwonorccgceo The Philadelphia Iron Trade in 1918 BY A. A. MILLER The year opened with business in the Philadel- phia territory at close to the highest mark. Pro- ducers had orders sufficient to keep them busy months ahead and prompt deliveries were hard to obtain. Activity continued during the early months of the year, but as summer approached hesitancy became pronounced and business steadily declined. Toward the end of the year heavy curtailments in pig-iron production became effective, and finishing mills were operating at about one-half of their pro- ductive capacity. Prices during 1913 were more uniformly based on supply and demand than usual. Many mills, hav- ing entered contracts for extended delivery, were unable to meet the current demand during the first half, while others, which followed the policy of sell- ing only for near future delivery, obtained sharp premiums for prompt shipments on nearly all classes of material. This condition prevailed until early summer, when the mills generally, having caught up with old contracts, entered new business at several dollars a ton below premium figures. Mid- summer marked the beginning of the downward movement of finished material prices and the decline was steady until the year end. In pig iron prices steadily declined almost throughout the entire year. One of the most pronounced exceptions to the decline in industrial activity was ship building. Practically every shipyard in this vicinity entered record business and operated at top capacity throughout the year. Vessels to enter the Panama Canal trade figured largely in the year’s business. Tariff reductions, together with the entire re- moval of the duty on pig iron, iron ore, ferroman- ganese and crude steel, which became effective in October, did not induce importations of foreign ma- terials. Business had declined sharply by that time, and prices abroad were mostly at a level which prohibited importations, even duty free. In in- stances where prices were lower than domestic quo- tations, and they were but few, quotations on for- eign materials were unusually met by domestic makers. IRON ORE Heavy purchases of ore for this year’s delivery were made late in 1912 and few large contracts were closed in 1913. A steadily declining pig-iron market restricted buying. The most important transaction involved 500,000 tons of Venezuelan ore, covering five years’ delivery. In September the initial cargo of Texas iron ore from Port Bolivar, Texas, was received at this port. Importations dur- ing 1913 aggregated approximately 1,325,000 tons, divided as follows: Cuba, 476,950 tons; Sweden, 375,000 tons; Newfoundland, 205,000 tons; Spain, 109,307 tons; New Brunswick, 72,260 tons; Vene zuela, 58,646 tons; scattered, 20,000 tons. Consid erable ore contracted for this year’s shipment wil! be carried over, as furnaces, owing to decreased activity, have been unable to stock all the ore for which they contracted. Importations of Swedish ore, largely on contracts, will total about 400,000 tons in 1914. As a rule, prices of ore during the second half were slightly lower than those at which contracts were made early in the year. In the fal! consumers benefited further by the removal of the duty. PIG IRON The market favored the consumer almost throughout the year. Early requirements were largely covered by forward purchases late in 1912 and buyers making later intermittent purchases forced prices downward almost continuously. Pro- ducers, being pretty well covered during the early months, did not force business, but were compelled to make gradual concessions from time to time to induce buying. Statistics compiled by the Eastern Pig Iron As- sociation show that, with the exception of a few temporary spurts, the tonnage of unfilled orders on hand steadily decreased and at the close of the year were lower than for any period during the past six or more years. Stocks on hand increased from the beginning of the year until August, since which time they have steadily decreased, producers cur- tailing the output to the approximate consumption, rather than accumulate heavy stocks in time of light demand. At no time during the year have stocks on hand been equal to two weeks’ capacity of the fur- naces in the district. Records compiled by the Virginia Pig Iron Asso- ciation show unfilled orders and stocks on furnace yards at their highest in January. There was 4 steady decline, both in orders and stocks, until about midsummer when orders became practicaly stationary and stocks slightly increased. Early in the fall orders increased, only to decline again dur- ing the closing months. Stocks on hand showed a steady decrease from August, but increased in De- cember. At the close of 1913 orders on Virginia furnace books represented but 30 per cent. of the volume at the beginning of the year, while stocks on hand represented 65 per cent. of the total on hand on January 1. In December stocks and unfilled orders were on a comparatively even basis. Eastern Pennsylvania No. 2 X foundry declined from $18.80 delivered here, at the beginning of the year, to $15.50 in July, when a temporary buying January 1, 1914 movement advanced the price 50c., but the gain was almost immediately lost. Virginia foundry moved irregularly, at times showing considerable variance from prices of Pennsylvania iron. The decline was steady from $16 at the opening down to $12.75 at furnace, at the close of the year. Cast-iron pipe makers in this district were intermittent buyers; at times round lots were taken, but considerable odd lot business was transacted. The movement in roll- ing mill forge iron was spasmodic. Purchases in the steel-making grades were irregular. With the ex- ception of a few movements, when round lots of both basic and low phosphorus were taken, buying was scattered. During a considerable portion of the year basic was inactive and nominally quoted. Following the removal of the duty on pig iron, considerable negotiation for Middlesbrough No. 3 ensued, but prices were higher than for equal do- mestic grades. A small lot of low phosphorus was the only sale in foreign steel-making grades. The accompanying table shows the average range of minimum quotations by months for the principal grades of pig iron delivered in buyers’ yards, eastern Pennsylvania and nearby points. Average Prices of Pig Iron, Delivered in Buyers’ Yards, Eastern Pennsylvania and Nearby Points, in 1913 Penna. Virginia Standard Standard No.2X No.2xX gray forge Basic low phos. i. ee 18.50 18.80 17.65 18.10 24.50 February ..... 18.25 18.55 17.31 18.00 24.50 MENGE ss accece 17.78 18.30 16.88 17.69 24.50 AMEE hs chide 17.50 17.92 16.55 16.75 23.62 MF bac n.ceeegs 16.80 17.10 15.85 16.50 23.50 FUE ov view ains 16.19 16.61 15.37 15.94 23.50 TURE we iitdowes 15.60 16.10 14.95 15.20 23.40 AGES: i. ubeur's 15.60 15.80 14.62 15.19 23.00 September .... 15.86 15.80 14.81 15.12 23.00 October ...... 15.95 15.80 15.00 15.30 23.00 November .... 15.55 15.80 14.75 15.00 22.31 December ..... 15.31 16.65 14.56 15.00 21.65 STEEL BILLETS Early in the year buying was heavy, mills were loaded with orders for three to six months ahead. and prices of basic open-hearth rolling billets were firmly held at $32 delivered here, Western consum- ers bought heavily from Eastern makers and con- siderable steel was sold for shipment to Canada. Large inquiries came from abroad but mills were too fully engaged to consider the business seriously. Prompt lots frequently commanded a premium, ranging up to $4 a ton. During the second quarter, when tariff readjustments were under consideration, buying eased and prices gradually sagged. In Octo- ber, following the removal of the duty, foreign roll- ing billets were offered at $23.35, seaboard, but the prices was met by domestic makers. In December rolling billets were quoted at $22.40 here. Forging billets followed the market on rolling billets at a spread of $4 to $5 a ton. During the first half of the year steel billet mill operations were at full capacity; early in the second half activities gradu- ally fell off, and during the closing months pro- ducers found it difficult to maintain a 30 per cent. basis without accumulating stocks. PLATES AND STRUCTURAL MATERIAL Gradual decline from extreme activity to com- parative dulness marked the movement in plates and shapes. Mill activities were at the fullest capacity early in the year and production records were fre- quently broken. Eastern mills followed a policy of conservative selling, dictated prices, and premiums for early shipment were general. The activity con- tinued until late in April, when the demand became easier and mills gradually caught up on unfilled orders. Early in the summer lighter demand brought price concessions, with declines steady dur- ANNUAL REVIEW SECTION 7 ing the remainder of the year. In the last quarter business fell off sharply and production dropped to approximately 50 per cent. Prices of plates in January showed a wide range- Western mills quoted 1.65c. here, with deliveries un- certain. Eastern mills booked orders freely for reasonable delivery at 1.75c. to 1.80c., universal plates commanding $1 advance over sheared plates. Quotations were firm until April, when 1.70c. to 1.75c. was quoted by Eastern makers. In May the differential between sheared and universal plates disappeared. In June Western plates were quoted at 1.60c. and Eastern plates at 1.65c., Eastern mills reluctantly meeting the lower prices. In September 1.60c. was shaded. In October 1.45c. was done on sharply competitive business and later in the year 1.35ce. delivered was reached. While makers of plain shapes were, to a large extent, booked farther ahead in the year than plate mills, the decline was felt earlier. Premiums for prompt shipment ruled up to April, quotations rang- ing from 1.65c. for forward to 1.75c. to 1.80c. for prompt shipment, while spot shipment frequently commanded 2c. In May 1.60c. to 1.65c. ruled for forward shapes and 1.70c. to 1.75c. for prompt. In midyear prices sagged to 1.60c., in September to 1.55c., and in October 1.50c. was reached. Sharp competition for business during the fall months brought gradual declines and at the close of the year prompt shipment was available at 1.35c. to 1.40c. delivered here, with very little forward busi- ness being booked. SHEETS AND BARS Sheet-mill operations were comparatively good almost through the entire year. At the opening of 1913 full capacity ruled and mills were further booked ahead on contracts than for years. This con- dition continued during the first quarter, Eastern mills readily obtaining premiums ranging from $1 to $3 a ton. In the second quarter forward buying was less in evidence, prices became easier, premi- ums gradually disappeared and in the second half buying became more and more quiet. No. 10 blue annealed sheets on January commanded 1.90c. here, with prompt shipments running up to 2.05c. These prices held until toward midyear when 1.90c. was quoted for both Western and Eastern sheets. In December prices were weak at 1.60c. to 1.65c. here. Bar mill operations were more or less irregular. Increased productive capacity resulted in less gen- eral pressure. Premiums for prompt deliveries were effective during the early months, but the supply rapidly adjusted itself to the demand. In the spring a lighter demand brought weakness, with no re- covery during the remainder of the year. A wide range of prices ruled at times, manufacturers of the better grades of iron bars refusing to make con- cessions as freely as common bar makers. Late 1n the year business was dull and activities were greatly restricted. Ordinary iron bars opened the year at 1.67 ec. for forward and 1.77%4c. for prompt shipment. In March prices still held at 1.67%4c., but covered prompt as well as forward shipment, with some mills holding at 1.724%ec. In May 1.47'c. ruled; in July, 1.8744c.; by November 1.2714c. was reached, and in December the market was weak at 1.22‘42c. Prices of steel bars in January ranged from 1.55c. to 1.60c. here, for forward and 1.85c. for prompt shipment. Prompt bars gradually declined and by midyear both prompt and forward bars were available at 1.55¢c. Prices held at this basis pretty firmly until October, when they became weak and during the last quarter declined rapidly to 1.35c. here. ie sac i als em <a es ae we > a ee | = etl acnanoatpwnmcnccienine. te allt natin iascail ie | sat eet rade pe OLD MATERIAL Consumers controlled the situation in 1913 to a large extent. Buying was in spurts, purchasers usually holding out for lower prices on each succes- sive movement. At times quotations were purely nominal, owing to lack of interest. Frequently, prices considered low enough to be prohibitive were offered by consumers, which, however, ultimately resulted in business. No. 1 heavy melting steel was quoted at $14.50 delivered early in the year, de- clining slightly in February and making a partial recovery in March and April, but not reaching the higher prices of early in the year. From April to September there was a downward movement from $13.50 to $11.50, followed by a 25c. advance, but during the remainder of the year prices steadily declined, reaching in December, $10, the lowest price for this class of material in many years. Low phosphorus steel scrap declined steadily, the full Average Prices of Old Material, Delivered in Buyers’ Jan. Feb. Mar. Apl. May June No. 1 heavy steel... $14.40 $12.87 $13.25 $13.44 $12.10 $11.75 Low phos. steel..... 18.55 17.94 17.75 17.50 17.00 16.75 TOG: GRE Sis wine aac 18.00 18.00 18.00 18.12 18.00 17.62 No. 1 railr’d wrought 16.10 15.12 15.25 15.37 15.00 14.75 Car WOES .ce ess 16.20 15.37 15.00 14.87 13.75 13.12 Wrought-iron pipe... 13.25 12.50 12.62 12.82 12.20 11.62 Wrought turnings... 11.20 10.37 10.12 10.31 9.20 8.00 Cast borings ....... 10.85 10.37 10.06 10.25 9.17 8.25 Machinery cast ..... 14.50 14.87 14.00 13.94 13.60 13.25 Stove plate ......... 11.00 10.50 10.50 10.44 10.00 9.87 Railroad malleable.. 13.50 13.50 13.00 13.00 17.60 12.00 THE IRON AGE January 1, 1914 drop being $5 a ton. No. 1 railroad wrought fell off approximately $3.50 a ton during the year. Toward the close of the year practically all kinds of old material were a drug on the market. The de- cline in general business made consumers wary and frequently they could not be induced to buy at any price. During the closing weeks of the year some inquiry, particularly for rolling mill grades for early 1914 delivery, had a tendency to strengthen the market, and the trade felt that the bottom, which had been looked for week after week, had at last arrived. The range of quotations, showing the monthly average minimum price for the leading grades, de- livered in buyers’ yards in this territory, taking a freight rate varying from 35c. to $1.35 per gross ton from Philadelphia is given in the accompanying table, the average prices for 1911-1912 and 1913 being given in the closing columns. Yards, Eastern Pennsylvania, in 1913, Per Gross Ton Aver- Aver- Aver- age, age, age, July Aug. Sept. Oct. Nov. Dec. 1913 1912 1911 $11.35 $11.43 $11.62 $11.15 $10.19 $10.00 $11.97 $13.59 $12.82 14.90 15.37 15.62 16.00 14.37 14.00 16.3 16.85 16.92 17.50 17.50 17.50 17.50 17.00 16.00 17.56 16.58 16.98 13.90 14.00 14.68 14.00 13.00 12.75 14.49 15.57 15.54 12.30 12.37 12.75 12.46 12.00 12.00 13.51 13.73 12.80 11.20 11.00 11.06 10.90 9.12 8.50 11.39 12.75 12.41 7.85 8.00 8.00 7.85 7.00 7.08 8.74 10.27 8.68 7.85 7.94 8.18 7.90 7.50 71.47 8.79 9.64 8.18 13.00 12.87 12.81 13.50 12.62 12.17 13.38 13.84 13.25 9.00 9.00 9.50 9.70 9.37 9.50 9.86 12.28 11.65 11.50 11.00 11.00 11.00 10.50 9.66 11.85 10.36 10.05 The Chicago Iron Trade in 1913 Bx GQ. J. In the two years between January 1, 1912, and January 1, 1914, the iron and steel trade has run the full gamut of experience, ascending and de- scending, from empty order books to oversold ca- pacity and back again to empty order books, from minimum. profits to maximum, the proverbial cycle of feast and famine. The year 1913.may. be de- scribed as a period of deceleration in which the mo- mentum acquired under the impelling forces of 1912 was gradually dissipated. In the first two months of the year the urgency and pressure of buying showed few signs of abating but as early as March the changing outlook began to be apparent. Under date of March 26 the fol- lowing comment appeared in the current issue of The Iron Age: “Without the background of mill order books filled for several months to come, cur- rent developments in iron and steel would appear only moderately encouraging. The effects of the gradually reduced buying pressure are becoming more apparent, as with most of the mills the pen- dulum has begun to swing back toward easier de- livery conditions.” Four weeks later this state- ment appeared: “To those disposed to view the market so as to find in the immediate happenings a forecast of untoward events to come, the past week offers more excuse than has appeared in many months. * * * There are those who see in the tightness of money and in the more conservative attitude of purchasing departments, a growing feel- ing of uncertainty and caution.” UNPRECEDENTED ANTICIPATION OF REQUIREMENTS. But it was not until the first half of the year had passed that the real trend of the market be- came obvious. This was due to the unprecedented anticipation of requirements by the railroads, in ABELL particular, and other users of steel. At one time early in the year one of the steel companies of the Chicago district having on its books contracts covering an aggregate of 1,700,000 tons to be shipped during the year had already received ship- ping orders applying against those contracts in ex- cess. of 1,000,000 tons. It is, therefore, apparent by what strength the market was sustained through the first three-qua