Document 5DMdJ941VRB5BN4dERdgg4yme

MiMWfrii- ifmn tmm, LIA15703 terlf -------- Hwirto kgr The Honorable JOBS N. mu Assistant Secretary for Nlnsral Besourca* U.8. Department of the Interior Washington, D.C. It is a privilege to4j to address this annual Joint Session of jrour two aajor mineral* organisations, tbs American Zinc Institute and tba Load Industrie* Association. I aa pleased to present the views of tbe United State* Department of tbs Interior before your group*. the Coreraaent baa at least two Major concerns with reference to Mineral raw aaterlals. Tbe first is tbe adequacy of supply. Tbe Satlon Must be assured of a continuing supply of metals, Minerals, and fuels to neet the needs of natlocml defense, and to support our expanding economy. Tbe second is that tbe Mineral resources of tbe country shall be wisely developed and utilised so a* to contribute their aaxlBVJH to the ecoooalc well-being of the people. Tb* effort of tbs Oovernaent to assure that tbe country will have Deeded supplies of raw eatsrial* 1* an laportant activation in auefa of tbe Satlon'a foreign ecoooalc policy. United States trade policies, treaties of conerce and friendship, tbe prograa of development of under-developed nations, and other laportant aspects of United States foreign economic policy stea In large part froa tbe lncreaaing aware ness of tbe Interdependence of nations with reference to roaourcoa. Tbe Oovernaent is not only concerned that tba supplies of Mineral raw smterlals shall be adequate to aeet tbe needa of tbe econcay, tbe Oovernaent has a aajor interest In encouraging the orderly development of our own Mineral resources, for this reason It assists In exploration, cooducta research to iaprove tbe useful ness of our resources, and In various ways stipulates tbe broadening of our resource base. Ooe key factor In tbe developaent of our Mineral resources -- and one that we overlook at cur peril is tbe necessity for educated and skilled Manpower la tbe Minerals area. In America today we find that tbe Mining Industry is facing a shortage of trained personnel. Our ainlng schools are being ellowed to wither while other technologies blossom In our colleges and universities. Zspedally in tbs eastern half of tbe Ration, tbe student enrollment in Mining and petroleua engineer ing la declining drastically. It baa gone so far, in fact, that at some unlrersltlea and colleges ainlng courses have been abandoned and departments eliminated or heavily pruned. Klnlng education Isn't alone in this downtrend; in only tvalv* years we have seen tbe number of engineering graduates -- in all fields of engi neering -- drop aore than one-third. Tbe so-called glamour fields of electronic* and apace technology are attracting more of tbe outstanding students while tbe Mineral disciplines -- concerned with tbe aoet basic of all tbe world's resource* -- find that they are wallflowers at the dance. Xou know, and I know, that there 1* glaaour, adventure, and challenge a-plenty to satisfy all tba brilliant youig graduates who go into tbe aineral industries. We all have a responsibility to encoursge students to enter our field, and to provldt thaa with tbe rewards -o Monetary and otherwise -- that will assure tbea of attractive careers. (Presented at tbe Joint Session of tbe Aaerlcan Zinc Institute and lead Industries Association, Chicago, Illinois, April 30, 1963) mqm p p LIA1570A -*-*. nuu Aa a libel*, hovavsr, the mineral resource* of America have never ban better prepared to contribute significantly to our national economic progress then they are today. Over the peat fee year* we have aade tremendous Improvements In our tool* and technique* of discovery. As a feault, our known reserve* of Hay Minerals are greater today than ever before. Technology all along the line Is moving forward -- in mining, In benefldatlon. In metallurgy, In secondary recovery. In utilisation. Productivity la advancing In almoat every aapect of mineral prodnetlon. We have a growing consciousness of the unused potentials of amterlala that are In abundance; our great unused coal reserves, our uranium wealth, the rich waters of the ocean, our newly discovered, berylilies ores, the aluelnum resource* In coamon clays, the msgnlflcent potential of oil shales and tar sands. Since World War H and the Korean Conflict, we have seen aa era of Intense minerals exploration. Wldespraad search for new deposits both at horns and abroad was stimulated by the growing demand coupled with the threat of aborteges during period* of war or threats of war. lew and more affective Instrument* for exploration, and Improved technique* in extraction, procsssii* and utilisation evolved under these pressures. In many instances, and you are quite familiar vlth them, man's resource fulness has led to Important shifts in utilisation of raw material*. The material* that come from the earth are becoming increasingly competitive between themselves; few markets remain the exclusive property of a single material, thus ingenuity and Oust plain salesmanship are more Important to specific resource Industrie* than ever before. Always around the corner Is a strong and aggressive eoaqietltor. The net result of extensive exploration, plus the Impact of competition between materials, la that productive capacity for several minerals end fuels exceeds requirements. In spit* of the growth rets of the economy, much usable productive capacity now 11s* Idle for lack of sufficient market* and Incentives. Vie President, In his economic Report, has stated that tbs overall Idle productive capacity In the Ration Is on the order of $30 to $k0 billion. In the minerals and metals are* the obviously largest Idle productive capacity Is In the coal. Iron and steel complex. Steel Ingot capacity Is 30 per cent greeter ttea production. Since 1937 there has been e decline of approximately 12 per cant la domestic steel production. This ledlne, contrasting with aa expected annual Increase of four or five per cent, has had a sever* effect on Iron mining, ore trsnsporstlon facilities, coal mining and coal transport, as well a* affecting the widely diffused ferrous scrap Industry. Th* situation It somevhst different In the alvmlnum Industry where-tb* record-breaking 19&2 production figure of 2.12 million tons was up 11 per cent over 19^1* let even here a half million tons of capacity went unused, and at least oos coapany dropped Its plans for s new reduction plant; a move that had unfortunate economic result* In th* pacific Rorthvest region. lour own lsad end sine Industries shoved Improved consumption In 19&. When th* final figures ere In you may find yourselves beck to th* 1955 sod 1956 level*. Yet I need not remind you that the Saties has both extensive Idle produc tive capacity in its adnes and smelters and large stocks of tb* two mttal*. Q mnmsmpa) smsm rr"'~~ i nn ir tfc ------ L" `...............'- - f it r - ir -h i run in i "il irifir - it - m iT"fir LI A15705 i* * ---------------------3------------ ---*------------------------------- J. W. OXU - ' i'<I i a The president's goal of full utilization of existing resources is essential If JUserlca1 s minerals Industry It to continue to contribute to the ecooos&c strength of the Nation, and to prorid* tha basic raw materials aecmseary for security. The full extent to which this ldla capacity dull* tha incentive for exploration aod mv investment in plant and equipment can only ha guessed; hut It obviously is groat and has far-reaching Implication* throughout tha economy. N* do know that in 1961 -- the latest year for which figures arc available -- tha alnlng industry (fuel aod nonfuel) expanded $260 million leas for new plant and equipment than In 1957* Principally this decline occurred In primary iron and Steel production, primary nooforroue astals, and atone, clay and glass products. The Kennedy Administration Is dedicated to a growing United States economy and aany of Its policies, fiscal, monetary, social, and trade, are spedflcally designed for this purpoes. There Is also la our country an underlying philosophy of expansion, of better things for more peopls. I believe we can cowt on these forces to carry us into a period of growth In the add sixties. Our gross national product (the most comprehensive msasure of economic activity) for 1962 was $555 billion. This was an all-tier record whether msaeurod In current dollars or constant dollars. It Is a high bass from which to project Into the add sixties. But there remains sufficient slack In the economy to permit, in fact to require, a further expansion. Government policies ere designed to take up this slack, for the year 19^5 2 believe the mineral Industry can look to a GXP possibly as high as $610 billion and should plan for markets of this magnitude. Cki the average this would be e 15 per cent Increase. 2 would expect some categories to exceed this target and others to fall abort. But as a whole, I don't believe this kind of placnlt^ is too embltloae. Government policies not only arm aimed at growth In the American economy, they seek also to stimulate growth of the economies of the entire free world. This I know sounds like a big order and It Is. But It Is the heart of the trade expan sion program, our major concern In the Organization for Economic Cooperation and Development, and our objective In the venous assistance programs. Our concern for growth In the economies of the free world notions -especially the less developed countrtee -- has led the Administration to emphasise the formulation of policies affecting cowodlty trade. The Government' would like to eee a greater stability In the volume and price of raw metarlals. Over the lorg run the Interests of producers, Investors, consumtrs, and governments are likely to be best served by an orderly development of the mineral resources of the world. Price were, cut throat competition characterized by the ready discount, and vlda open forced drav^ht production that builds up burdensoms stocks are not calculated to enable the world's mineral resources to make their maximum economic contribution to the strengthening of the economise of the countries which are primarily producers of raw materials. I think the Kennedy Administration goes much further then previous artminlstrallons In diplaying initiative end contributing Ideas In the search with other nations for practical solutions to the problems of commodity trade. wmmm i p s.nm--mwmsuw I mn II ii-WWipi I j . " " f'T " ' wmm. TUT*- ~r LIA15706 iaw,:^-,Jfi^',^'Vfih'ilt,*mfrTilr'-l,J.'-' iVf'iir -4. n . taua- To date most of ths efforts of the Oovernmsnt Id the ccmmoilty field have been directed toward tropical agricultural product* such aa coffaa and eoeoa, although we have ahovn an Interest In tin, have participated In tha Lead-fine Study Croup, in tha GBCD Sonferroua Metala Committee, In an international consultation oe tungsten, and aupportad a request of the Organisation of Amarlcan States to the 01 for an International consultation on copper. Ifclla tha words eonodlty agreement are frequently heard, tha r<--iiilltj policy of tha Oovarsmsnt la hy no aaana exclusively, or for that aattar prlaarlly, directed toward tha proaotlon of International coanodlty agreements, father It la a caaa-hy-casa approach. In an effort to find solutions which aaphaslsa stability and which cushion tha lapact of violent swings la the market. (he of the stahlllsatloa techniques being given much consideration la referred to as compensatory flnandig. This would provide funds for natloM bard hit by short term fluctuations In world coamodlty markets. So one expects this device alone to solve problems created by cyclical and other short-term declines la export receipts. It can be used In conjunction with more fundamental approaches which seek to expand and diversify a country's production and export. Tou are, of cown, aware that tha United States has been actively seeking acme fora of International arrangement that would bring a balance into world produc tion and consmotion of lead and xlnc. A meeting of representatives of some 15 nations took place In Geneva the last week In Much at which this problem was pursued further. (bit of the nations feel that some fora of agreement la desirable. Several supported the Idea of production controls. The United States Indicated that we would find production controls of questionable desirability, and exceeding ly difficult to edmlnlster, even If we were to achieve egreeaent on the production question. The United States representative suggested that we try a short-term program of export controls. This proposal didn't get much further than ws had expected although several countries supported the Idea. Sor did tha proposals for production controls get widespread support. This discussion of tba Increased efforts of governments to exercise more control over tba eomaodlty trade leads to a sobering', and to me disturbing, observation. Private enterprise sad tha basic concepts of competitive capitalism are being examined somewhat critically In the world today la tha field of resource development. Skepticism as to tha ability of private capital to bring about a visa use of resources Is appsarlng In many places. It's easy to say that It stems from the constant drumming of tha Soviets and their astellites, go small part of It, however, stems from tha convictions of many people that private enterprise not only cannot develop and utilise resources In an orderly amnnsr but that tha extractive Industries cannot contribute much to tha development of people. got only in tba lasa developed countries but In such Industriallsad nations as K-iglend and Prance, people have been unwilling to turn over to private enterprise the development of mineral resources. Even bare in the United States the people have been unwilling fully to permit the play of competitive market forces to determine bow resources shall be developed. m rnrnmmm mm W LIA 157 07 - "fr-ti55ipi n ~ 9 i : _______ --,-------------------------------------------------------------------- -------- -- ----------------------- j . a kxux ' Itost of the lead and tine entering th Barista of th fro* world la produced, acid and bought by private enterprise. There la of course a alcalflcant amount exported to the Wait by tha centrally planned economise and aoaa produced In western countries by atit* production and controllad by atate trading. Cot tha Croat bulk la th* product of privet* enterprise. Apparently aoaa of these producers equate tba principles azad practlaaa Cf private aatarprlaa with tba lav* of tba juz^la. It should not ba necessary for oovmtrles aucb aa our own to bars to throw up quota barrlsrs against import* In order to prevent a disruption of tba market. I A producer's philosophy of doc *at doc suit ba replaced by ooa of lit* and let live -- or ve say find one day that we have run thro<b our low cost, high grade, ore and cannot meet the competition of aaterlala that have bean --naged acre wisely. 1 (very experienced miner knows that continuous high grading aooa spalls disaster, if collectively the sine* of the world are put on a continuous high grade basis of operation -- that la, only tha high grade nloea operated while all others close down -- they will court the sane disaster that a single Bine doas when it resorts to high grading. I aa not here arguing for keeplig open a lot of submerglnnl nlnas. I aa only saying that there must be ways and means of bringing a greater degree of volume and price stability to the production and marketlrg of raw Materials without doing violence to our concepts of coapetitlve capitalism. M It aeeaa to ae that tha people of the world are saying three things about mineral resources- One, that no nation can duap Its surplus la another's lap and disrupt Its markets. Two, that no nation can alt on Its resources and deny access 4 to tbea by Industrial nations which need them. And, three, that sotsebow a nation's resources must contribute to the development of Its people. The growth of this latter idea Is significant. Too such of tbs history of the extractive Industries, until quite recently, has been that many times the capital of the underdeveloped but mineral-rich countries has been mined out -- and the people left undeveloped. Tbo recent mlnltg laws of severed countries represent an Insistence that a country's resources shall be used to develop tbs people of the country. Interdependence of nations In natural resources Is ripening Into Inter national responsibility for tbs welfare of peoples. I think most of you know me well enough to rest assured thet I am not proposing nor* government as a cure for the short-comings of private enterprise, but, the very nature of the world In which we live makes It difficult for govern ments to keep completely out of matters affecting bualneee and Industry, especially In relation to natural resources. 1 Ky plea today Is for a responsible private enterprise -- one that la responsive to the challenges of our tins*. Industry must be alert, aggressive, aad i t 1 I 'iwrnppq LIA15708 j -) < -------j--.-- k . mu -- l Intelligent -- otherwise Its aarkete 4re lost. But also Industry aust apply the mu m intelligence and foresight to the orderly and vise development of the world*a resources, to the iUUUu Uo ii of aarkete, aod to the development of the peoples of the world. Zf tha fraa world la to ratals Its freeflow, private competitive capitalism ust work for It. 3 M X | :* s i 1 1 H ### 1 ijniiiiKn^iiia^c^a o IPW.aya^PBPlfPBppwpijiiiaa.na t .1. n <um 11. iiij 1, p