416 



THE INDIA RUBBER WORLD 



[September i, 1904. 



GERMAN VIEWS OF THE RUBBER CRISIS. 



FROM THE " GUMMI-ZEITUNG," AUGUST 5. 



A DIRECTOR of one of the largest Berlin rubber goods 

 factories has expressed himself as follows in the Berliner 

 Tageblatt : 



The critical situation in which the German rubber factories are placed 

 at present may be ascribed to two causes — overproduction and the con- 

 stantly increasing disproportion of the prices of crude materials and the 

 manufactured goods. The overproduction may be explained by the fact 

 that within the last three years many new factories have come into exist- 

 ence which were determined to transact business at any price in order 

 to obtain a foothold, and has been made still greater by the fact that 

 some German electrical companies, who were formerly extensive buyers, 

 have for the past two years manufactured their own requirements in 

 rubber goods. The abnormal rise in the price of raw stuffs was inaugu- 

 rated about two years ago. Para rubber, quoted at the close of 1902 

 at 2r. I0<r\ per pound, had, in December, 1903, advanced to 3s. f)}id. , 

 and at present is quoted at 4s. 11./., which shows that within eighteen 

 months the price has nearly doubled. This rise in prices was not caused 

 by scant supplies (which have slowly increased), but solely by the manip- 

 ulations of English dealers in crude rubber. The English market is 

 dominated by perhaps less than ten firms, who tenaciously cling to the 

 high prices. Occasionally, by cornering the market, they create an ar- 

 tificial scarcity of supplies ; this is especially applicable to one of the 

 largest rubber firms of Liverpool. 



It has been impossible for the German rubber manufacturers to raise 

 the price of their manufactures to anything nearly proportionate. The 

 factories in general have continually sustained losses, having been com- 

 pelled to buy materials at advanced prices to fill contracts estimated at 

 a lower figure. Some of them sustained losses by the failure of firms, 

 with whom they closed contracts for the delivery of crude rubber to ful- 

 fil their obligations, owing to the severe rise in prices. The idea of 

 forming a kartell was advanced, but, owing to the fact that in Germany 

 there exist about 55 rubber goods factories, each of them making spe- 

 cialties, it has been abandoned. To show how difficult it is to bring the 

 several factories together, it may be mentioned that at a conference re- 

 cently called by the Verein Deutscher Kaittschukfabrikanten for the 

 purpose of advancing the prices of rubber goods, only twelve factories 

 were represented ; the other factories, though fully aware of the precari- 

 ous condition of the rubber industry, refused to attend. That it was 

 possible to form in Austria, a few months since, a kartell of rubber 

 goods manufacturers, is owing to the fact that in Austria only eight rub- 

 ber factories exist. Nevertheless the German manufacturers, in dealing 

 with the patrons of the kartell, undersell the latter. 



The condition of the German rubber goods factories, especially of 

 those who are financially weak, has become almost unbearable, and will 

 improve only if, by some means now unforseen, the ring of the English 

 rubber dealers could be broken, or, if through force of conditions the 

 several factories, without combining, would advance their prices. Be- 

 sides this, the Berlin factories are facing a strike, so that likely they will 

 have to figure with troublesome wage conditions. 



This summary gives our readers no new information, but 

 only the identical arguments which we, for years, have ad- 

 vanced as being essential to the development of the German 

 rubber industry. The only thing new is the assertion that the 

 crude rubber prices are fixed and held up solely by the Liver- 

 pool dealers, to which we cannot unconditionally agree. That 

 speculation acts a certain part — and in what raw product, now- 

 adays, does it not — is without doubt, but it does not act the 

 dominant part. Speculation certainly could not maintain 

 prices lastingly at such enormous heights, without other favor- 

 ing conditions. These conditions include the indisputable fact 

 that the receipts of Pard rubber have not increased within the 

 past few years, but remained almost without change, while the 

 demand, aided by the automobile industry, has increased 

 enormously. The best proof of this is that it is impossible 



anywhere to store up large quantities, and in no market, Liver- 

 pool included, are there larger supplies than in former years; 

 on the contrary, they are materially less. 



But this (the assembling of large stocks) would be a natural 

 consequence if the prices were forced up by juggling. Further- 

 more, the selling prices at Paid, and the prices at London, 

 Hamburg, New York, and Antwerp, which always correspond 

 with those of Liverpool, prove that it is the unfavorable condi- 

 tions existing in supply and demand of good rubber sorts, 

 which regulate the price. The rise in prices of inferior sorts, 

 which, comparatively, even exceed those of Para, is still further 

 proof for this assertion. We are crediting the Liverpool deal- 

 ers with great influence, but that they are enabled to rule all 

 the rubber markets of the world and solely and alone fix prices, 

 is beyond our belief. 



It may be possible that the speculators can force the prices 

 up a few pence beyond what actual conditions warrant, but lo 

 maintain artificially for years such an enormous advance, in 

 all rubber sorts and in all markets, is impossible ; natural con- 

 ditions, playing an important part in the crude rubber trade, 

 are too weighty for that. Great efforts have been made in 

 times past for this purpose— the New York trust is still in 

 memory — but they have stranded on the fact that the crude 

 rubber market cannot be ruled from one particular point. 

 Though it is desirable to break the " ring of English rubber 

 dealers," it is doubtful that the rubber goods manufacturers 

 would profit thereby for any length of time. The receipts 

 would not be increased thereby and the demand would not 

 stop. Much more could be gained if our industry should suc- 

 ceed in locating new sources of rubber supplies, and our manu- 

 facturers should assist all efforts made to cultivate rubber 

 plantations, which is the only means to prevent a scarcity of 

 supply and restore normal price conditions. 



Until then, only one remedy is left to our manufacturers for 

 the present difficult situation, and that is a corresponding rise 

 in selling prices. There is no other way, and it must eventually 

 be taken, no matter how difficult it may seem. A factory 

 which to-day does not advance prices sacrifices all its profits 

 and transgresses the principle on which all healthy business is 

 based, that the prices must be in unison with the cost of mate- 

 rial and manufacture. 



WAGES IN THE RUBBER SHOE INDUSTRY. 



THE July Bulletin of the national bureau of labor, at Wash- 

 ington, is devoted to " Wages and Cost of Living," a 

 mass of statistical data being presented, with the indication 

 that the increase in wages which clearly has taken place in 

 many industries since 1890 has, on the average, more than kept 

 pace with the increased cost of living which is proved with 

 only a little less definiteness. The Bulletin contains very little 

 data pertaining to the rubber industry. In fact, returns are pre- 

 sented from only two rubber factories (unnamed, of course), and 

 the substance of such returns are condensed in the table below. 

 It should be mentioned that wages given are for a week of 60 

 hours, and are computed by multiplying the average hourly 

 wage for each class of workers by 60: 



1893 1903. 



WORK. Number. Wages. Number. Wages. 



a Bootmakers Male 31 $1786 33 $21.48 



a Cementers Female 18 715 35 8.05 



b Cutters M 30 16.28 35 1S.16 



a Grinders M .28 915 33 8.15 



* Mixers M 16 q.57 15 9-85 



a Shoemakers F. 132 7-55 l8 5 8.00 



a — Data from one ettablishmenl. 

 b — Data from two establishments. 



