IMPORTS AND EXPORTS OF MINERAL PRODUCTS, 1900-17 (000 omitted) of.. 121 Cement.. 79 270 Coal. Coke. Copper, ore and matte. Emery and corundum. Graphite. Iron and Steel: Iron ore.. Pig iron. 291 702 1,640 1,493 1,016 749 1,341 1,267 4,112 83,119 6,281 322,284 6,069 291,921 520 359 Oils, mineral. Phosphate rock 75,611 79,793 99,090 137,237 152,174 133,693 166,417 230,953 1,118 Plaster.... 16 6 391 283 189 187 Platinum Salt.. Quicksilver.. 142 285 1,071 726 Silver. 56,712 48,848 55,286 71,614 54,965 50,942 59,792 78,280 Tin, scrap. 44 29 64 141 Manufactures of 5,411 Zinc, ore and dross 1,205 1,765 881 690 588 695 177 986 66,109 XVIII. MANUFACTURES W. M. STEUART was not entirely satisfactory (see XII, Economic Conditions; and XVI, Agriculture), and the prices of these and most other products advanced steadily during the year. As compared with prices prevailing in July, 1914, the month immediately preceding the outbreak of the European War, wheat and flour in the Minneapolis market had increased in June, 1917, more than 200 per cent.; wool (Ohio fine-fleece, scoured), 134.6 per cent.; worsted yarn (2-32S, cross-bred stock), 138.5 per cent.; bituminous coal (run of mine at Cincinnati), 172.7 per cent.; electrolytic copper, 142.5 per cent.; pig lead, 194.9 per cent.; pig tin, 102.6 per cent.; Bessemer pig iron, 267.1 per cent.; and steel billets, 419.7 per cent. Needless to say, the enormous foreign demand and the stupendous volume of exports continued to be the prime stimulating factor in the rise of prices of most commodities (see also XII, Economic Conditions; and XIX, External Commerce). General Conditions.-The year 1916 closed with a great uprush of prices of staple commodities and agricultural products. Most lines of manufactures had been enormously stimulated by the war, and manufacturers faced the problems of 1917 with a wealth of capital never before at their command, but with costs of operation at unprecedented high levels. Manufacturing costs, except for temporary and local reactions, continued to advance during the year. The increase in costs of production was necessarily accompanied by increase in the prices of finished products. This condition became more acute as the year advanced. It was accompanied by a large expansion of bank loans, but the tendency to inflation was overcome by the volume of business, the amount of securities repurchased from Europe, and the amount of foreign loans made (see also XII, Economic Conditions). The abnormal increase in some branches of manufacture, and the shifting of industry emphasized the dispropor- The prospective requirements of tion or lack of balance between the the Government were an important agricultural production and the in- factor in industrial activities and dustrial production. The rapid rela- necessitated readjustments in both tive increase in industrial and urban production and prices. The discuspopulation and the correspondingly sion of government control of prodrapid relative decrease in the agricul- ucts and prices caused considerable tural and rural population which has unsettlement in both speculative and been in progress for over a decade legitimate markets. The extensive were more pronounced during the and constantly increasing war reyear, due to the great demand for quirements more than offset the lull labor in munitions plants and gov-in regular business, but as the year ernment work incident to the war. Inventions and improvements in agricultural machinery, however, so added to the productive power of the relatively diminishing number of farmers that they were able to increase their output of foodstuffs per unit of labor and capital. Nevertheless, the production of the staple agricultural products as foreshadowed in October advanced most of the leading industries operated under increasing difficulty on account of the growing shortage of labor, especially during the early fall, when the government requirements for military supplies were being met. These requirements made necessary a shifting and readjusting process in many branches of industry. They tended to repress operations in some channels, while at the same time stimulating a wide range of war lines to great animation. It was impossible to determine in advance how far these readjustments would be necessary, which lines would be most repressed, and to which the prevailing conditions would give the greatest stimulation. The labor problem was the most perplexing feature of the industrial conditions of the year (see also XV, Labor). The constant plea for higher wages rested on the ground that the cost of living had increased enormously and apparently would continue to increase. Increases in wages were necessarily followed or accompanied by further increase in prices. The assembling of a large army not only drew to an alarming extent on the productive labor in many lines, but the demands on transportation facilities, both by land and water, incident to its upkeep disarranged the distribution of products to an extent never before experienced. While these abnormal conditions of production and distribution continued throughout the year, it was a period of unusual prosperity in all basic lines of manufacture. Industrial Failures.-Despite the very material increase in new enter prises and other factors calculated to enhance the possibilities of financial embarrassment, failures during the year were moderate, and there was no evidence that the economic readjustments occasioned by the nation's participation in the war caused an increase in financial failures. In fact, during the first half of the year there were but 7,488 failures in all lines, with liabilities amounting to $94,721,000, which was the best numerical exhibit since 1911, while the liabilities were the smallest for any similar period in nearly a decade. The following statement shows the magnitude of the failures in manufactures during the first three-quarters of 1916 and 1917: The failures returns for the nine months, better than those for monthly or quarterly periods, clearly disclose the comparatively very favorable mercantile and industrial situation of the year. Defaults for the first nine months reached only 10,737, against 13,250 for the same period in 1916 and 17,288 in 1915, and the liabilities involved were $141,950,038, against $154,586,707 and $241,464,060 in 1915 and 1916, respectively. Manufacturing debts at $59,691,242 were slightly in excess of the preceding year, but this was due to a single disaster for $5,000,000 in Connecticut in June, although some increase in liabilities was to be found also in the Middle-Atlantic and CentralEast sections. (See also XII, Economic Conditions.) Development of Manufactures.-The year has been one of the most remarkable in the history of domestic manufactures. The abnormal activity in all lines producing to meet the requirements of the military operations has been the predominating feature. The annual products of the manufactures of the country in 1849 were reported as being worth $1,019,000,000; the production for 1917, in all probability, was valued at more than $30,000,000,000. Seventy-eight per cent. of the more than six billion dollars worth of exports in the fiscal year 1917 consisted of wholly or partly manufactured goods. In the fiscal year 1914, the last normal year before the war, the proportion of such goods exported was only 59 per cent. In 1914 the exports of manufactures ready for consumption were valued at $724,908,000, or 31 per cent. of the total exports, while in 1917 their value reached $2,943,923,212, or 47 per cent. of the total (see also XIX, External Commerce). To what extent high prices have been a contributing element in the year's total may be conjectured from the fact that the export prices in June put wheat at $2.72, as against $1.27 a year earlier; corn at $1.66, as against $0.83; flour at $10.36, as against $5.52; and structural iron and steel at $84.48 per ton as against $56.50. During 1917, the third year of the war, the manufactures in most industries have been teeming with prosperity, their resources have been greater than ever manufacture of crude iron and steel before, and many have accumulated and its conversion into finished proda large surplus. used in their production but also of articles for personal wear and of a great variety of products for other uses, is, from the standpoint of numbers employed, the most important generic group of manufactures in the United States. It was among the first to show the influences of the war crisis, which necessarily had a more direct and pronounced effect on some branches of the industry than on others. ucts were the two basic industries to Basic Industries.-Abnormal condi- which special attention was directed tions in regard to the supply of raw by the disturbed conditions attending materials and labor, prices, costs, the war. The manufacture of textiles and distribution have characterized and their products, which covers the the year's operations in all branches manufacture not only of fabrics and of manufacture. Notwithstanding the partially manufactured material these conditions, the manufacturing capacity of the country was greatly increased during the year. New plants were erected and many plants added new buildings and new machinery. The necessity for rapid increase in production to meet the requirements of the Government and the serious industrial disarrangement following the declaration of war emphasized the necessity of a closer coordination of industrial and governmental activities. With this in view, arrangements were made during the late summer and fall for the appointment, in most of the basic industries, of committees to represent the several industries, and to serve as connecting links between them and the Government. It was generally agreed that under the existing conditions the problems concerning the supply of materials and labor, the shifting of labor from one community to another or from private to government employ, were problems not only of the individuals in an industry, but of the industry as a whole, and not only of the industry, but also of the Government. To prosecute the war it was necessary that the Government obtain materials and supplies in vast quantities, and to accomplish this it was essential that it have the advice and assistance of men having thorough acquaintance with each industry. The Government was confronted also with serious problems in connection with the regulation of prices. Conditions rapidly developed which made the fixing of prices a matter of competition between buyers, the highest bidder securing the goods. In order 1917. to bring about maximum production at reasonable prices, it was necessary to fix prices to a certain extent in all the basic industries. (See also XII, The Conduct of Business.) The manufacture of textile fabric and the conversion of the fabric into articles for personal wear and the Cotton. Measured by the capital invested, number of persons employed and quantity and value of product, cotton is by far the most important of the textile manufactures. Since the outbreak of the European War its importance has increased as industrial changes have made it necessary to use 30 per cent. more cotton in the United States. The supply of cotton in the United States for the year ending July 31, 1917, amounted to 16,606,048 running bales, including 1,759,522 bales of linters, as compared with 16,972,895 bales in 1916 and 18,913,660 bales in 1915. Forty-six per cent. of the total supply for 1917 was consumed in the United States, while but 43 per cent. of the supply for 1916 was consumed in this country. Since 1914, when the price was the lowest recorded since 1898, the price of cotton has been rising rapidly, and the highest point was reached during 1917. following statement shows the quotations for midland upland in cents per pound on or about Oct. 12: The New York New Orleans Liverpool 27.65 261 39.44 1916. 17.55 161 20.54 1915. 12.50 12 14.38 1914. Nom. 6 10.60 1913. 10.82 805,883. The increase in the number of active spindles kept pace with the increase in the consumption of cotton. The stock of cotton on hand on sives, mattresses and medicinal cotAug. 1 (3,173,832 bales) was the low-ton and for miscellaneous purposes. est recorded since 1914. Consump- The spindle is the accepted unit of tion proceeded at an unprecedented measurement for the consumption of rate, and was stimulated by the re- cotton in the manufacture of fabrics. quirements for military purposes. In 1917 the equipment of the mills of These requirements, so far as they the United States comprised 34,221,related to the manufacture of ex- 252 spindles, as compared with 33,plosives and medicinal cotton, were 333,176 in 1916, an increase of 888,076. met in a measure by the increased A certain percentage of the spindles production of linters, the short fibre are idle during each year; during 1917 obtained by the cottonseed-oil mills there were 33,888,835 spindles in opfrom reginning cotton seed before ex-eration, while in 1916 there were 32,tracting the oil. Linters now enter into many lines of manufacture in which otherwise it would be necessary to use cotton. It is used in uphol- While the year as a whole was one stering and in the manufacture of of unusual prosperity for the cotton mattresses, comforts, batting, cush- industry, the development was charions, wadding and pads; for mixing acterized by great irregularity. Durwith shoddy and for making low- ing the year there was a greater degrade yarns, wrapping twine, cheap mand than ever before for coarse yarn rope and lamp and candle wicks; for goods, and cotton was used to a making absorbent cotton; and in the greater extent as an adulterant in manufacture of guncotton, nitre pow-combination with wool in the manuder and writing paper. In the United facture of clothing material, and also States, prior to the European War, to a rapidly increasing extent in nuthe greatest quantity was consumed merous products required for the auin the manufacture of felts and bat-tomobile industry. The steady payting. The demand for explosives since 1914 has resulted in greatly increasing the quantity of linters used in the manufacture of guncotton and smokeless powder. Experiments have proved that the short-fibre cottons are better suited for this purpose than the longer; hence, linters are being very generally used. This extended demand for linters has very materially increased the price of this product, the market price being several times as high as it was before the war. The ginning of cotton is the first stage of its manufacture. For the crop of 1916 there were 21,624 establishments in which this process was carried on. Although there has been a decided increase in the quantity of cotton ginned during recent years, the number of ginneries has been decreasing. There is a general tendency to construct larger and better equipped establishments. ment of regular and extra dividends by many mills indicated the continued prosperity of the mills following the period of uncertainty after the beginning of the war. Most manufacturers were of opinion that cotton would rule high for a long time, and in a number of instances mills with gov ernment contracts, made early in the. season, large purchases of material, sufficient to meet requirements to the end of the year. It was reported early in September that the Federal Government and others engaged in war work had purchased since Jan. 1, for immediate and future delivery, between $200,000,000 and $250,000,000 worth of cottons of various kinds. This, and the fact that the exports for the fiscal year 1917 amounted to $136,253,858, ensured continued prosperity for a number of months. Woolens and Worsteds. Next to cotton, woolen and worsted fabrics are the most important of the textile Of the 7,658,207 bales of cotton, in-products, and a maximum production cluding linters, consumed in the Unit-of these also was essential for war ed States in 1917, between 85 and 90| purposes. Early in the war an emper cent. was used in the manufac- bargo was placed on the export of ture of fabrics, the remainder being wool from Australia, and the imports used in the manufacture of explo- into the United States during the fis |