Document OJ1063DqKvg1vpzaEZwd6R6OK

' milHCTPHJnHjjiJWjU pmiU mmmtm LEAD INDUSTRIES ASSOCIATION 4J0 UDUNOTON AVtNUK NSW YORK t7, N. Y. nOTftiwfifitifra I June 13, 19k9 To Mashers of the Lead Industries Associations SIBJXCTt ADDRESS BEFORE THE UJUC MI3D10 ASSOdmOH CM "TtE SHIFTIKO SCEXE IM LEAD" Attached please find copy of an address to be delivered by your secretary at the Convention of the Idaho Mining Assco lation in Sun Valley, Idaho, on June llj, l$b?, on "The Shifting Scene in Lead" cr.~aiin 1.1,'ii j i. .i <p iin j i \ ' Me"1' - am ./ /  I |U j w j .1 I ^LWJ-iIP-1^P1!^ it* rtfcirtrfntf111. * Urmi vm^A n'^rfcn Z^878 for Release Juno IS, 1019 - AM Lead Xnduitrles is soelation t?0 Lexington Avanua New Tork 17, U. T. The Shifting Scene In Lead* Byi Robert Lindley Zlagfeld, Secretary Lead Industries Association Hew Tork, H. T. After two years of record-breaking lead prices, we have Just passed through three months of the aost precipitous price drop in history. Looking back, the forces which caused these movements are always easy to understand. The end of the war left the country with a terrific derutnd for load products since the public had been unable to buy many of tho things they needed and wanted. Huge consumption of lead in the years following the war finally caught up with this backlog all along the line and when dealers* and manufacturers' shelves were filled with lesd products ultimate consumption dropped back to nonael and buying of tho raw material, pig lead, virtually atopond, is these Inventories of lead products are worked off, lead manufacturers are bound to e Address before Idaho Lining Association, Sun Valley, Idt>o, June It, 191*. PfUJWEl ipWHPfWI^ "W iHPJWgyu' 'ft N 1781.01 UtfiySw*CTW eT VA 2* reenter the market, but probably with More iwwl buying than we hare had In the last three yeera. For the first tine In several nonth* manufacturers' stocks of plf lead showed a rather substantial drop on May 1, according to Lead Industries Association statistics. That is encouraging. Post-War Trend First, the abnornal demand coupled with the low production rate immediately following the war which resulted from postponed development work and a shortage of labor, caused the price to swing upward at m unprecedentedly rapid rate. When lead reached its high of 2lJd per lb., its price index, based on 1926 as 100, stood at 255.3. At the same tine tho Bureau of lebor Statistics price Index of all commodities only reached a high of 165 and even * farm products only reached 188. Obviously such a price for lead could not bold for long. It stimulated production and curtailed consumption. Now that the sky-rocket has come down and lead Is back to 121 per lb.. It price Index la 182.5, while the index for all commodities Is still at 156.5 and for farm products at 178.5. Just as the price on the upswing went to an extreme. It al-vo appears that on the downswing the same thing baa happened. Aa a matter of fact the price today 1* net cuch different froa shat it waa at the end of the war If premiums paid at that time arc taken Into consideration* 8toraeo Battori os Now, what st"*s do wo find In the wind today to ho.p us guoss at the fhturv course of your l'ad outlets? Thera are sosse optfo ttte factors. In the first four months of this year only r. little over 3,000,000 roplacomant motmnp fi.urpr i da |J?P'IHPP'.'HU J1IIUIHI.W ,r *KP "~--- 1 -Mu * - ------ * --- -----*---- ------- **- -- ---- "'-1- t Vm1 f L IA24880 W 1 t o i ; ' -3- storage batteries were sanufactured, That was leas than half of the production of tho corresponding period last year* Tct battery ntkers who hold their annual convention just a few weeks ago still expect to produce sono 17,000,000 or 18,000,000 batteries this year as against about 2li,000,000 last year and their optlnisa nay bo warranted frost the fact that there arc over ti0,000,000 cars on the road. The average life of a battery 1s less than two years, Thus, If tho battery Industry Is right It will have to produce In the last eix aontha of this year some 18,000,000 batterlos, which would closely approximate last year's rate. In pnssir^ It Is Interesting to note that the weight of lead per battery has been Increasing In tho last few yoars and has risen frow 22 or 23 lb, to about 27 lb* Tetraethyl lead Another optir.lstie note is supplied by the tetraethyl lead Industry which has grown froa nothing a little over 2D years ago to a lead consunptlon of about 80,000 tons last year. Two things are contributing to its further growth, wore cars and higher compression engines. Several of the oil ccopanies have stepped up their octane ratings In recent norths and the sutonobils nanofaeturera are just waiting for better gasoline further to Increase the power of their engines. That Mine nore tetraethyl lead. Also, there r sees 10,000,000 ooro cars on tho road today than at tho end of the war. That weans wore gasoline and wore lead. So tho Indications aro for continuing Increases In thu use of lead for tetraethyl lead, Tbward that end the tcir'ethyl load Industry Is Increasing Its productive capacity. Sane of the k u capacity will bo in operation as early as Au "ust or Scptrzbur of this y r r:. 1 >vc next year, Estlaetos hnvo bocn undo by ths best informed people that uss o'* l jf Mlhyl lead nay nore than double In the next five years. . ' v ......... ' 7" ng"`-!u^'^ J< y* >'mww "^' - .'s-wf---- Y r-- " LIA 2 A 88 1 'Ip"*** I 111 ..frt. UfaliHfc-* -J" "T-* ifllifrfrpfc--m if-Khi *w*+, S 4 1 e -L- Lead Sheathed Csblo In Mother big u of lead there Is a further raj of sunshine* The cable Industry, while It Is not using load at quite the rate It did lest year, la likely to continue on a fairly even keel* There Is area some possibility of improvement. Curing the severe lead shortage and period of high prices a substantial amount of cable sheathed with sub stitutes for lead was manufactured* The lower lead price may Influence some swing back to lead as these substitutes are still generally considered to have certain drawbacks in comparison with lead for cable sheathing. Paint In the paint and construction fields, two other important outlets for lead, the outlook is sore clouded* In paint the consumption of lead has probably suffered more as - result of the high price and shortage than In any other lead consuming preduct cr Industry* Tho paint business is highly competitive end even at nomal prices load is the most expensive common ptpsent used by print manuf.-cturcre. So quality has been sacrificed by reducing the lend content of house prints ns much as possible* Lower lead prices may stop this trend or evm reverse It In view of the recognised improvement In quality that load provides, but it is too soon to tell >st what the net result will be* In the case of red lead paints for Iron and stool the picture Is more chewful. Substitute plpsonts became quite well entrenched during the war in cortrln quarter*, There are now definite indications of n lack of complcto satisfaction with the substitutes. At tha same tirno new rod load formulations have boon developed to meet the special requirements exacted of today's industrial paints, and red lead Is making a stmng bid to r^g-in substantial lost narkrta, I m proud that ruch of this Is j.r  pi ' < LIA2A882 1 i*Vrtft. .,- . -,iv.,--<Jw ga^fc,j.>,-,- ,> >* Ift nr i irin *li 5" sttributsbls to the rssssrch ind educational work of tbs Rod lead Technical Coaelttse of tho Lead Industries Association* Construction In building construction whore load is used B.alnly for uator distribution and pluitbing, the recant high prices grsre great impetus to efforts of producers of conpctltlvo Btarials to substitute their natcrlals for lead* They hare r-idc soac progress, but again through the efforts of tho Le*d Industries Association in large treasure, we hare isanagod to hold on to nest of our business* Hew nuch longer we could hare held out against these high prices is problcna.tieal but the lower lead prices should rdlere the pressure to sane extent* Bowercr, lmcdiatc trends in lead consumption X: in building cc instruction rill depend very Inrgly on the trend of construction itself, which is expected to bo senewhat 1 wer than l'st year's record, but 3 nevertheless at a relatively high rate* In chedcal construct!an, where lead is employed to f"bric'te corrosian resistant cqulpntnt, there is no d'-ubt that considerable constructin is being held in abeyance until costs -nd business generally show signs of st-biliting Ir-wcr price* 1 for lead should help to tone extent Competitively, Tho foregoing use* of lead m which 1 have consented in sene dct-ll *cc-nmt for about three-quarter* cf *11 lead consumption* Cn then, to a. largo extent, depends the lead narket, There arc, of course, nany things /brut the narket* for these products orer which wo have llttlo control and general business condition* hare a profound influeneo on then* Tot there is *lso nuch th*t c*n bo dano to stlrxilate the use of lead products* Seec of this we arc doing and hr boon it'lng for yc*rs. There is still ich norc that eon 'nd should be dene* s? WijHjHW|yi lr ttibiimt* mti&m i ij *jinii|i>jR>;> wy m 6^ ^fchr>auflf^-iiii 0 4 'T To atirulato the nnrkct for lead products la only part of tho battle for a prosperous industry, although It la n nighty Inportant part* Z have elaborated on the principal uaoa of lend beenuao that phnao la acre rorrte free y>u ns producers of tho raw nstorinl* Stockpiling Oovemnont stockpiling in tho post yonr has taken a plneo of prordncncc in the load picture th't nakca It comparable with sono of the n*J-<r uses of load* for instance In the current fiscal year which ends this nr nth, the Ooverment has stockpiled an rmur.t of lead roughly equal to the e msunptlcn of lead In tetraethyl* It has, therefore, bocne something of nvj-r liapr.rtanco to ru* Last week lead producers net with tho ttmltlons Board on the stockpile question* thlle to ry knrwlodgc nr Indication was given of the anount to be purchased In the new fiscal year starting Ally 1, I an Confident that pirehas cs will b' sitcable and will be well In excess of this year's purchases* Taxation Thcr: are ethr-r angles which rust bo pursued but they ere ftiill.ar ta y -u and need no repetition on ray part. There is Just coc I w-uld like to aaphasiac because its ncccnpllshncnt requires the education of the Ooverment and the public to the peculiar pr-hlva of the nlnlng Industry. It Is taxation* We rust all work together for a 'r- realistic attitude toward taxation, Tho lnvostncnt of risk capA-1 in r.lning rust be encouraged by n'klng It possible to realise r-turns corr* nsurat a with the risk. It nust also be recognised that the risk in nlnlng to day, r.s n- at surface deposits hive b*#n discovered and wrked cut, la greater andthai. axploratlen and develop* wen coats are higher, which calla for a awre qyapathetlc attitude toward taxation than has ever been accorded the Mining Industry* Mey'uir. I .nuiiu 11so* ..wmr ii