September 1, 1919.] 



THE INDIA RUBBER WORLD 



687 



:100" 



rubber, however, underwent any sustained rise or fall from the 

 prewar level which was in any way comparable to that prevalent 

 among other com- 

 modities. (See Fig. 

 2.) And in no case 

 did rubber prices 

 reach the level of 

 early 1913. 



The two impor- 

 tant types of rubber 

 — plantation first la- 

 tex crepe and Para 

 u p r i V e r fine — de- 

 clined sharply in 

 price during 1913, 

 the former experi- 

 encing a decrease of 

 over 50 per cent 

 during the first 10 

 months of the year/ 

 This was due to the 

 large output of 

 plantation rubber,' 

 which in 1913 was 

 almost 20,000 tons 

 larger than in any 

 previous year.' 



The abnormal de- 

 cline in the price of 

 the plantation varie- 

 ty brought rubber 

 values down to the 

 lowest point ever experienced in the history of the industry. Its 

 effect upon the price level in the years following is made evident 

 in Figure 2. Here it will be noted that while the price of both 

 types of rubber declined in 1913 in a more or less uniform 

 manner, after that time the Para variety remained slightly be- 

 low and the plantation slightly above the 1913-14 market level. 

 This phenomenon is entirely the result of the abnormal decline 

 of plantation prices in 1913 and shows the effect of this price 

 fall on the pre-war level which is the base to which tlie war 

 prices have been reduced. 



The low level of crude rubber prices running throughout the 

 period of the war was broken by important increases but twice — 

 one rise reaching its peak at the end of 1915, and the other early 

 in 1917. Crude rubber prices, like all others, of course, felt the 

 effects of panicky conditions following the outbreak of the Eu- 

 ropean war in August, 1914. With the resumption of activities 

 in September, however, rubber prices returned to their normal 

 level. Both rises mentioned above were common to all types of 

 rubber and may be accounted for by more or less like reasons. 

 Plantation rubber, however, also experienced a temporary in- 

 crease in December, 1914. This was the result of the British 

 embargo on shipments to this country. In October, 1914, Great 

 Britain decreed that no shipments from her plantations in the 

 Far East should be made to any port other than London. A 



'The January, 1913, price of $1.10 may appear high when compared 

 with the present price of crude rubber. But when it is remembered that 

 rubber in May, 1911, only 19 months earlier, sold for as high as $2.85, the 

 story of rubber prices becomes even more interesting. 



'During the first six months of 1913 there passed through the London 

 auctions over 11,000 tons of plantation rubber, as compared with about 

 7,000 for the corresponding period in 1912. 



"The slight decreases in American consumption is another factor worthy 

 of consideration in this connection. The tariff discus.sion in 1913 and the 

 fear of removal of duties on rubber goods were the cause of much appre- 

 hension in the rubber industry and tended to make American manufac- 

 turers conservative in their purchases. Then there was the strike in the 

 rubbci factoucs of Akron, where about 50 per cent of the rubber imported 

 into the United States is consumed. It is estimated that during the period 

 of idleness accompanying the strike some 3,000 tons of rubber which would 

 under normal conditions have been consumed in Akron, remained on the 

 market. .-Vnd. finally, there should be remenibered the flood of the Ohio 



curtailment of manufacturing operations. 



supplemental decree in November prohibited all exports of crude 

 rubber from any English port whatever. The announcement of 

 this action, and the realization that its enforcement would cut 

 the normal supply of the United States by approximately one- 

 half, sent up some 30 per cent the price of what little rubber 

 there was on the American market. This rise was short-lived, 

 however, and the removal in January, 1917, of the embargo on 

 shipments to the United States under a system of guaranties, 

 brought plantation prices back to norma!. 



The first general rubber price rise was occasioned by the ab- 

 normal demand following the closing of the Suez and Panama 

 Canals and by submarine activity in the Mediterranean. It was 

 expected that the closing of these water routes would shut off 

 supplies from the Far East, and the trade both in London and 

 New York immediately proceeded to buy up whatever supplies 

 were available. The rise early in 1917 was also purely specula- 

 tive in character and may likewise be attributed to submarine 

 activities. 



An important factor which tended to keep rubber prices down 

 during 1918 was the character of the import regulations of the 

 War Trade Board. Rubber was one of the first commodities the 

 import of which was licensed. This was due to the fact that 

 there was great need for rubber by the Central Powers. On 

 December 7, 1917, the War Trade Board issued regulations which 

 provided for the licensing of imports, for the consigning of all 

 imported rubber to the Rubber Association of America, and for 

 the submission of guarantees by importers and manufacturers 

 that they would not sell any rubber, directly or indirectly, to 

 any country at war with the United States, or to any person, 

 unless satisfied that there was no intention of exporting without 

 an export license. 



No restriction was placed on the amount of rubber that could 

 be imported until May 8, 1918. The acuteness of the shipping 

 situation then necessitated the reduction of the amount imported 

 to the essential needs of the country. Accordingly, on May 8 

 the War Trade Board, after conferences with representatives 

 of the rubber industry and the United States Shipping Board, 

 restricted the quantity of rubber to be licensed for import during 

 the three-month period, May, June, and July, to 25,000 long tons, 

 which is at the rate of 100,000 long tons per year, or about two- 

 thirds of the 1917 importations. Subsequently the War Trade 

 Board virtually increased the amount to be licensed for import 

 to 28,000 long tons (green basis) per quarter by ruling that the 

 Brazilian imports should be allocated on a dry basis which al- 

 lowed approximately 12 per cent for water content. 

 Table IV— Virgin akd Recl.umed Rubber Required ior the Manufac- 



For deiivciy to the Army and Navy during the calendar year 1918. 



Pounds. 



' \'irgin. Reclaimed. 



For tires and tubes — • 



Motor vehicles 33.965,167 8,057.454 



Airplanes 315,236 26,198 



For other articles — 



Aircraft " production (^°) (^^) 



Chemical warfare- 

 Gas defense 2,308,000 102.000 



Other defense <") (") 



Construction Division 529,587 1,054,609 



Edgewood Arsenal (") (") 



Engineci 297.202 99.408 



Medical 906,385 47,709 



Ordinance- 

 Nitrate Division (") (") 



Other 57,919 96,531 



Ouartermaster 9.172.579 3.575,683 



Signal Corps 9,122,403 2,706,198 



United States Government explosives plants (.^) (") 



Total Army requirements 58,674,478 15,765,790 



Other requirements: 

 Navy 2,846,000 214,000 ' 



Total requirements 61,520,478 '=15,979,790 



1° See Signal Corps, and Tires and Tubes. 



" Negligible. 



'' Other Government requirements, that is, the Railroad Administration 

 and the Emergency Fleet Corporation, together with the requirements of 

 Allied nations for war purposes, are estimated to have brought the total 

 monthly war requirements up to 3, ICO per month. 



