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June 29, 1918 RECORD AND GUIDE Ti 7 823 Portland Cement Production Equals Demand No Surplus Stocks on Hand—Government Work Requires About 23 Per Cent, of Total Output IN order to get the latest authentic information about material prices, availability of supply and similar topics, the Record and Guide has just completed a thorough inves¬ tigation into the manufacture of one of the most essential structural materials—cement—to find out what the producing situation is, how the war has effected manufacturing supply and cost, and the length of time that existing economic con¬ ditions might prove a detriment to the progress of building construction. It has been reported in the newspapers that the Govern¬ ment has issued priority certificates for Portland cement. A dispatch to the Record and Guide from its Washington repre¬ sentative shows, however, that such is not the fact. The authorities have agreed to give cement manufacturers a degree of preferential treatment, in order to assure a reason¬ ably full supply. This was made conditional upon the manu¬ facturers curtailing their productions sufficiently to meet the demands of war requirements and other needs of national or exceptional importance. This plan, it is estimated in Washington, means a curtailing of the normal output by about thirty per cent. Investigation into the conditions surrounding the produc¬ tion of Portland cement in the Lehigh Valley indicates that although the war has created an abnormal situation in many respects, the cement industry is operating upon a sound basis, producing and shipping material to the maximum permitted by the Fuel Administration, making every effort to conserve the resources of the industry, serve its customers to the best of its ability, and patriotically "do its bit" for the Government in its hour of need. The producing capacity of the Lehigh Valley Portland cement manufacturing district is approximately 30,000.000 barrels annually, but during the past three or four years the average annual output has been in the neighborhood of 23,000,000 barrels a year. This amount is approximately 36 per cent, of the entire cement production of the country. Early this year the National Fuel Administration decided that for 1918 the cement industry should be furnished with coal sufficient to manufacture 75 per cent, of the average output of the past three years. Owing to the difficulty in obtaining fuel during the first three or four months of this year, which prevented the operation of the majority of the cement plants in the Valley during that time, it is doubtful, even if the mills operate to their full capacity for the balance of the year, whether they will be able to produce 75 per cent, of their output of previous years. There has been consider¬ able curtailment in production this season, but manufacturers are not willing to give out definite figures at this time. Notwithstanding the lack of construction of a private nature it is extremely doubtful if there has been a time in the history of the Portland cement industry when manufacturers have had a smaller stock of the finished product in reserve. Almost all of the storage bins in the Lehigh district are cleaned out nightly and the finished product loaded upon cars for ship¬ ment. Many of the makers are shipping their entire daily output as it is made, and as the demand is steady there is little likelihood of any great reserve being piled up at mill points. At present there is a negligible amount of Portland cement being exported to foreign ports, practically the entire mill output is going to supply the jobbers or into war construction and the other types of building requirements in the United States. The railroads of the nation formerly were prominent among the cement users, but these interests are now taking a small quantity as they are only making road repairs of the most essential character. Manufacturers are agreed that there is, and will be, a sufficient supply of cement for all building purposes and that there cannot be a famine in this important material line. Cement, tributary to the New York market, is readily avail¬ able and in volume sufficient to take care of any ordinary demand, unless the Government materially increases its present requirements. An official of one of the prominent producing companies in the Lehigh district stated that during the past month about 23 per cent, of the shipments from their mills were forwarded direct to Federal building projects. As all orders for materials to be used in Government work are pro rated among the manufacturers according to the capacity of their respective plants, this figure can be taken as indi¬ cating the amount of Portland cement the Government is now taking out of the market. It is believed that Federal requisitions of cement are likely to become much larger than at present and that the demands upon the industry will grow in volume as the war progresses and the Governmental program of construction is expanded to its maximum. Producers will not be surprised if the Government announces that it will require the entire output of the cement mills for a limited period, possibly for three or four months. The Portland Cement Association pledged 100 per cent, of their output, if necessary, at any time the Government should have need of it. Cement manufacturers are paying higher wages today for common labor employed in their plants than ever before, yet they are experiencing great difficulties in holding their forces together. Producers are paying at the rate of 32c. to 3Sc. per hour for a ten-hour day, with time and one-half for overtime, and double time for Sundays and holidays, which is about 100 per cent, above the scale in force prior to the war. Yet they lose men to other plants in the district who offer wages con¬ siderably higher than the scale paid in the cement mills. The Bethlehem Steel Company, located in the heart of the cement producing district, and other foundry and manufacturing cor¬ porations have immense war contracts, are steadily draining the cement industry of its man power by offering work at the rate of 44c. and 45c. per hour for common labor. These con¬ cerns have been offering as high as $8.50 per day for skilled mechanics, carpenters, masons, plumbers and other trades. Military enlistments and the selective draft have also added to the labor difficulties of the cement manufacturing industry. A large percentage of the men employed in these plants were of military or draft age, and the number of draftees added to the high percentage of voluntary enlistments from this district has resulted in intensifying the labor shortage. At present, and for some time past, there has been prac¬ tically no difficulty in obtaining all the coal required to operate cement plants in the Lehigh Valley. Fuel shipments are now coming through in excellent volume and reasonable time and without the assistance of Federal priority orders. Some of the manufacturers using a slag anthracite are even able to store up considerable tonnage against the time when freight, transportation and mining problems might again interfere with their obtaining the required supply. Users of high gas bituminous coal are unable to store supplies in any great quantity, owing to the inflammability of high gas coal, which is a constant menace to the plant. These producers depend upon a steady supply of fuel from the mines. The mounting cost of fuel has been one of the principal reasons for the steady advance in price of Portland cement. Before the war, slag anthracite was selling at the mine mouth for 75c. a ton and plus the freight and handling brought the delivered cost up to about $2.50 a ton. At present the same quality of coal is costing, delivered, in the neighborhood of $6.00 a ton and this price is likely to increase. As it requires about 160 pounds of coal to produce a barrel of Portland cement it can be readily seen how this increase has effected cement prices. Packing costs have also been prominent among the influ¬ ences that have advanced the cost of cement to the consumer. Prior to 1914 the cost of bags made from seven-ounce cotton duck, generally used in cement bags, was 8c. or 8^c. each per bag. Now bags made of the same quality of material cost about 30c. each. The rebate that manufacturers allow for returned bags is 10c. each. Paper bags of a quality strong enough to stand the strain required before the war cost about 2^c. each. At the present time producers pay $60 a thousand or 6c. each for bags bo poor in quality as to make the safe arrival of cement at its destination problematical. According to the present outlook producers of Portland cement predict that the price of their commodity will not recede from its present high level for a long time to come. Production, packing and shipping expenses are steadily mounting, as are wages, and the producers expect to pass these additional costs along to the jobbers and the ultimate consumers.