D 651 .S5 P7 Copy 1 D 651 i .S5 fl7 Copy 1 UPPER SILESIA IN ITS ECONOMIC RELATION TO POLAND AND GERMANY PUBLISHED BY THE American-Polish Chamber of Commerce and Industry -, 40 West Fortieth Street, New York FOREWORD In the preparation of this statement concerning the economic relations of Upper Silesia with Poland and with Germany, a particular effort has been made to present the material in a statistical form. Figures are given covering the output of coal, iron and zinc in Upper Silesia and the consumption of Upper Silesian products in Poland and Germany. Similarly, figures are given concerning the consumption of im- ported foodstuffs, raw materials and manufactured goods in Upper Silesia. In compiling these figures every effort has been made to employ only reliable statistics, compiled either by various government officials or by the research departments of technical and industrial establishments. Among the sources used are the following: German Government Report of Merchandise Shipments on Railways. Report of Upper Silesian Coal Shipments. Report of the Mining Industry of Austria. Statistical Year Book of Congress Poland. Report of the Western Russian Mining Districts. Mining and Metallurgical Review. Quarterly Statistics of the German Empire. Report on the Upper Silesian Mining and Metallurgical Industry. Mining and Metallurgical Industry in Congress Poland. Handbook of Upper Silesian Industry. Year Book of the Breslau Mining District. Commercial Balance of Former German Poland (A. Rose). Throughout the body of this report notations are made indicating which of these sources were used for the particular statistics presented. This statement is based entirely upon economical considerations, political reasons for the union of Upper Silesia and Poland not being resorted to. Germany bases her whole case on the economic necessity of retaining control over Upper Silesia. —THE EDITORS. LIBRARY OF CONiJRESS MAR18T921 Upper Silesia in its Economic Relation to Poland and Germany It is frequently stated in certain economic circles that the economic rela- tions of Germany and Upper Silesia are so closely interwoven that separation would bring- about the economic ruin of Upper Silesia and would influence unfavorably Germany's ability to pay the Allied Powers the reparations which have been demanded under the terms of the Treaty of Versailles. Among- others, Mr. J. M. Keynes, in his book, "The Economic Consequences of the Peace," has taken this view. /According to popular opinion, based on misinformation, Upper Silesia is connected with Poland only in a very loose way and means to Poland only an additional source of wealth, and is not essential to the economic existence of Poland. This opinion is based on the lack of even such elementary information as the territorial extent of present-day Poland. For instance, Mr. Keynes states in his book (page 79) that Poland in the year 1913 consumed 10,500,000 tons of coal, of which 6,800.000 tons were supplied by coal fields located in the territory definitely assigned to Poland, whereas Upper Silesia supplied, accord- ing to the same authority, only 1,500,000 tons. We have found it impossible to ascertain from what sources the figure of 10,5000,000 tons was taken. It is less than half of the real consumption of Poland in that year. The figure of 6,800,000 tons, given by Mr. Keynes, represents the production of the Dombrbwa Basin, the Krakow Basin not being taken into consideration. The figure of 1,500.000 tons represents the imports during that year of Upper Silesian coal to the former Congress Poland only. The importation of coal from Upper Silesia to all the territories which have now been united into the Polish state was five times as great as the figure thus given. If we study more closely the Upper Silesian industry and its relation to Germany and to Poland, we find, on the contrary, that for Germany Upper Silesia would mean only a source of greater wealth, whereas for Poland it is a fundamental basis of economic existence. Germany without Upper Si- lesian coal will be not onl}^ able to cover her entire demands, but will have considerable coal for exportation, whereas Poland cannot exist without the Upper Silesian coal. The Upper Silesian iron industry does not play any great role in the total balance of Germany ; its significance for Germany has been decreasing from year to year. The natural markets for this industry were the Polish provinces, from the largest of which Upper Silesia was cut off by customs boundaries ^ which hampered the development of the Upper Silesian iron industry. On the other hand, territories .belonging to the present Polish state are 3 ._.. ^ for Upper Silesia sources of raw materials (such as iron ore and wood) and of food which Germany is not able to supply to Upper Silesia. The above statements may be proved by figures relating to the most important branches of Upper Silesian industry, and by showing the relations of this industry to Poland on one hand and' Germany on the other. First in importance is coal. Coal The territories included in Poland as at present constituted consumed 19,445,000 tons of coal in 1913. Though no inconsiderable amount of this coal was obtained from Polish mines, the greater portion was imported from outside the present boundaries of Poland. Of the total consumption, 10,- 488,000 tons were impoj^ted and 8,957,000 tons produced within the country. Of the coal produced in mines belonging now to Poland, Dombrowa coal was consumed almost exclusively in Congress Poland and the coal from the Cracow Basin in Galicia. The Ostrau-Karwin imported coke was used Consumption of Coal in Poland — I* I— PIT COAL Former Congress Poland Tons Tons. Pit coal 7,438,000 Coke 603,000 tons, equivalent to 861,000* 8,299,000 Galicia Pit coal 4,163,000 Coke 62,900 tons, equivalent to coal 90,000 Poznania Pit coal 2,518,000 Coke 55,900 tons equivalent to coal 80,000 Polish West Prussia and Danzig Pit coal 1,480,000 Coke 40,000 tons, equivalent to coal 57,000 Polish Teschen Pit coal 851,000 Coke 8,000 tons, equivalent to coal 11,000 4,253,000 2,598,000 1,537,000 862,000 Former Russian Poland East of Congress Poland Pit coal 1,620.000 Coke 6,000 tons, equivalent to coal 9,000 1,629,000 Total 19,178,000 Total— Pit coal 18.070,000 Coke 776,000 tons, equivalent to coal 1,108,000 19,178,000 * Throughout this statement coke has been converted into coal at the ratio of 10 tons of coal to 7 tons of coke; and brown coal brickets into brown coal by- multiplying by three, because the caloric value of one ton of brickets eorre- sponds on the average to three tons of brown coal. (These ratios were fixed by the International Coal Cominissions.) *Geniian Government Report of Merchandise Shipments on German Railways. Report of Upper Silesia Coal Shipments. Report of Mining Industry in Austria. Statistical Year Book of Congress Poland. Report of the Western Russian Mining District. Mining and Metallurgical Review. Consumption of Coal in Poland — II 11— BROWN COAL Congress Poland Tons Tons Brown Coal ^^5'?22 Brown coal brickets 400 tons, equivalent to brown coal. . 1,200 156,000 Galicia Brown coal ^7,000 Poznania Brown coal • .^S'^SJ Brown coal brickets 161,200 tons, equiv. to brown coal. 48J,600 ^,^„^^ 514,000 Polish West Prussia and Danzig Brown coal brickets 61,200 tons, equiv. to brown coal.. l^f'SSS Xotal 891,000 Total— Brown coal 223,000 ==i Brown coal brickets 222,800 tons, equiv. to brown coal 668,000 Total 891,000 Grand Total— Pit coal 19,178,000 Brown coal 891,000 tons, equivalent -P'— _!!^~ 1„45,000 mostly in Congress Poland, whereas the coal from Ostrau-Karwin was con- sumed mostly in Galicia. Consumption of Upper Silesian Coal in Poland A study of the distribution of Upper Silesian coal and coke among the different Polish provinces in 1913 shows that every region in Poland was partly dependent upon coal from Upper Silesia, the three districts consum- ing the greatest quantities being Posnania, 2,464,125 tons; Galicia, 1,962,000 tons and Congress Poland, 1,524,943 tons. (See table, page 6.) It must be mentioned that the data regarding the importation from Upper Silesia to Congress Poland, Galicia, Posnania and Polish West Prussia have been co-ordinated with the figures of German experts. With regard to importation of Upper Silesian coal to Danzig, Polish Teschen and former Russian Poland, east of Congress Poland, the figures have been calculated on the only basis that is just, viz.: on the basis of the German railway sta- tistics showing how many tons of coal, coke and brickets were shipped from Upper Silesia to each separate station of destination (according to "Ueber- sicht uber den Oberschlesischen Steinkohlen Versand, getrennt nach Stein- kohle, Briketts und Koks nach den Eizelnen Stationen des In-und Auslandes," 1913). On the German side objections have been made against adoptmg this method for the Polish Teschen, on the ground that some of the coal sent to stations in Polish Teschen was reshipped from those stations to other destinations. The German experts are not able, however, to confirm this argument by any concrete evidence. Even if we admit that a part of the Upper Silesian coal shipped to Polish Teschen was really reshipped outside 5 , Consumption of Upper Silesian Coal in Poland The distribution of Upper Silesian coal and coke among the different Polish provinces in 1913 is given by the following table: Congress Poland Tons Tons Coal 1,203,55S Coke 224,972 tons, equivalent to coal 321,388 1,524,943 Galicia Coal 1,860,515 Coke 57,602 tons, equivalent to coal 82,288 1,962,803 Poznania Coal 2,416,121 Coke 33,603 tons, equivalent to coal 48,004 2,464,125 Polish Western Prussia Coal 748,134 Coke 12,924 tons, equivalent to coal 18,463 766,597 Danzig Coal 415,000 Coke 7,000 tons, equivalent to coal 10,000 425,000 Polish Teschen Coal 611,035 Coke 1,857 tons, equivalent to coal 2,653 613,688 Former Russian Poland East of Congress Poland Coal 95,385 Coke 700 tons, .equivalent to coal 1,000 96,385 Total 7,853,541 Total— Coal 7,369,745 Total— Coke (338,658 tons), equivalent to coal. 483,796 7,853,541 (Brickets on account of the very small quantity are not shown in separate column, but are included in the coal figures). present Polish boundaries, the quantity of this coal could only have been very small. If we compare the figures of Upper Silesian coal shipments to Poland with figures of the total consumption of coal and coke in Poland, we find that the consumption of Upper Silesian coal amounted in 1913 to 40.4 per cent, of the total consumption in Poland ; this proportion was for Congress Poland 18 per cent., for Galicia nearly 50 per cent, and for former German Poland nearly the whole pre-war consimiption, 90 per cent, being covered by coal and coke from Upper Silesia. Of the total production of Upper Silesia which amounted in 1913 to 43,- 6 170,000 tons, the shipments to what is now Poland were 18.2 per cent., and of the total railway shipments to points outside of Upper Silesia they were 29 per cent. It being evident from these figures that coal from Upper Silesia is a fundamental item in the Polish coal supply, it is next essential that we study the relative importance of Upper Silesian coal for Germany. Origin of Coal Consumed in Poland I— PIT COAL A— Black Coal Tons Tons Production of Dombrow Basin '. 6,834,000 Production of Krakow Basin 1,971,000 Production of Mine "Silesia" in Polish Teschen.... 184,000 Less exportation from Krakow District 23,000 Less exportation from mine "Silesia" 75,000 B— Coke- Importation from Ostrau-Karwin District 338,000 Importation from Upper Silesia 339,000 Importation from Germany 96.000 Importation from Donetz 3,000 Total home production 8,989,000 Importation from Upper Silesia 7,370,000 Importation from Germany 186,000 Importation from Ostrau-Karwin Basin 463,000 Importation from Donetz Basin 1,000,000 Importation from other coal basins 160,000 9,179,000 18,168,000 98,000 18,070,000 Equivalent to coal 776,000 1,108,000 Total 19,178,000 II— BROWN COAL A — Brown Coal Production in Congress Poland 155,000 Production in Galicia 37,400 Production in Poznania . 25,000 Total Home Production 217,400 Importation from Germany 5,600 223,000 B — Brown Coal Brickets Importation from Germanj- 222,800 tons, equivalent to brown coal 668,000 891,000 Grand Total pit coal 19,178,000 Brown coal 891,000 tons, equivalent to pit coal 267,000 19,445,000 Total Consumption in Germany'^' The total production of pit coal in Germany, including Upper Silesia, Alsace-Lorraine and the Saar Basin, amounted in 1913 to 190,109,440 tons. Importation of coal to Germany was as follows : Tons 1-Pit coal 10,540,069 2— Pit coal brickets 27,272 3— Coke 594,501, equivalent to coal 849,287 Total imports 11,416,628 Total imports and production 201,526,068 Exportation of coal from Germany was as follows : Tons 1— Pit coal 34,598,408 2— Pit coal brickets 2,302,602 3— Coke 6,432,986, equivalent to coal 9,189,980 Total exports 46,090,990 The total consumption in 1913 of pit coal and coke in Germany within her frontiers of 1913 \vas, therefore, 155,435,078 tons. In order to obtain the consumption of pit coal and coke in 1913 in Germany within her present boundaries we must, from the above figures of 155,435.078 tons, deduct the consumption in 1913 of those territories which, according to the Peace Treaty, have been cut off from Germany The consumption of pit coal in these territories amounted to : Tons Alsace-Lorraine 11,131,000 Saar Basin 5,800,000 Schleswig-Holstein — Eupen Malmedv 600.000 Posnania '. 2,598.000 Polish West Prussia and Danzig 1,537,000 Luxemburg . . .' 3,860.000 Total 25,226,000 To this must be added part of the pre-war consumption of coal by the Germany navy and merchant marine and by the munitions industry, which consumption is now reduced at least by 3,000,000 tons, and (if Upper Silesia is united with Poland) the consumption of pit coal in Upper Silesia, which amounted in 1913 to 14.012,000 tons, making a total of 42,538,000 tons. From the above it follow^s that the pre-w^ar consumption of pit coal and coke in Germany within her present boundaries and excluding Upper Silesia amounted to 155,435,078 tons, less 42,538,000 tons, or a total of 112,897,078 tons. The consumption of brown coal in Germany in 1913 is shown by the fol- lowing figures : Tons Tons German production 87,233,084 Importation to Germany : 1— Brown coal , 6,987,064 2 — Brown coal brickets, 120,965, equiv. to. . . . 362,895 7,349,959 94,583,043 Less Export from Germany : Tons 1 — Brown coal 60,345 2 — Brown coal brickets 861,135, equiv. to brown coal. . . . 2.583.405 2,643,750 The consumption of browai coal in 1913 in Germany within its former boundaries amounted therefore to 91,939,293 tons. For consumption of brown coal within territories cut off from Germany *QTiarterly Statistics of the German Empire. 8 1.300,000 is deducted. The consumption of brown coal in 1913 in Germany within her present boundaries is thus 90,639,293 tons, which is equal to 27,191,788 tons of pit coal. The total consumption of coal in 1913 in Germany within her present boundaries amounted therefore to: Tons Pit coal 1 12,897,078 Brown coal, equiv, to pit coal 27,191,788 Total ' 140,08^,866 According to the Versailles Treaty Germany has lost her coal basins in Alsace-Lorraine and in the Saar Basin, which produced in 1913 : Alsace-Lor- raine, 3,817,000 tons; Saar Basin, 12,223,000 tons, or a total of 16,040,000 tons. If Germany loses Upper Silesia, this figure will be increased by the produc- tion of Upper Silesia, 43,170,000 tons, or a total loss of 59,210,000 tons. If Ave deduct from the total production of pit coal in Germany, which as we have shown above amounted in 1913 to 190,109,440 tons, the production of coal basins which Germany has lost already and of Upper Silesia, 59,210,000 tons, there remains 130,899.440 tons as the pre-war production of pit coal in basins which will belong to Germany as at present constituted. Present Supplies of Coal Available for Germany According to the data at hand the present production of pit coal in Ger- many amounts to 78 per cent, of the pre-war production ; the present produc- tion of pit coal basins belonging to present-day Germany would therefore amount to 102,100,000 tons. With regard to brown coal, its production in Germany from the beginning of the war not only did not decrease, but on the contrary, it even increased considerablv and amounts now yearly to about 100,000,000 tons, which corresponds to 30,000,000 tons of pit coal. The total present production in Germany of pit coal and brown coal expressed in pit coal amounts thus to 132,100,000 tons. To this must be added the importation to Germanv of coal from Upper Silesia, amounting during the first six months of the year 1920 to about 1,000,000 tons monthly, or yearly, 12,000,000 tons. Germany, therefore, has altogether at her disposal : Tons Pit coal of her own production 102,100,000 Brown coal of her own production 100,000,000, equiv. to pit coal 30.000,000 Upper Silesian coal 12,000,000 Total 144,100,000 If from this amount we deduct deliveries of coal by Germany to the Allies in accordance Avith the Peace Treaty, and amounting at the present time according to the Spa conference to 2,000,000 tons monthly, or 24,000,000 yearly, there remains for the interior consumption of Germany 120,100,000 tons, or nearly 86 per cent, of Germany's pre-war consumption, which amounted as shown above to 140,086,866 tons. It must be added that consumption of coal in Polish territories, since the reconstruction of the Polish State, that is during the years 1919 and 1920, has not even during one month amounted to more than 50 or 55 per cent, of the pre-war consumption. Very few of the Western European countries working under the relatively best economic conditions can cover as high a proportion of their pre-war requirements as Germany does, 86 per cent. If Germany brings her production of pit coal to the pre-war level, that is to 130,899,000 tons, and adds thereto 100,000,000 tons of brown coal (equal to 30,000,0000 tons pit coal), and the importation from Upper Silesia, which at the present rate, is amounting annually to 12,000,000 tons, the total amount at the disposal of Germany will be 172,899,000 tons. This is an amount which will allow Germany, not only to fully cover her requirements at the pre- war rate (140,088.866 tons) and fulfill her obligations to the Allied Powers, but will even allow her to export a considerable amount of coal. 9 Let us make a further comparison between the consumption in 1913 of Upper Silesia of coal, and the total consumption of coal and coke in Germany within her present boundaries. In 1913 the consumption of Upper Silesian coal and coke in Germany (not counting- Upper Silesia itself), amounted to: Shipment by rail : Tons Coal .. 13,468,699 Brickets 107,624 Coke 194,287 tons, equivalent to coal 277,553 Total 13,853,876 Shipments by water 2,265,801 Total 16,119,677 Less shipments to territories : Ceded to Poland 3,230,722 To Danzig 425,000 Total 3,655,722 Net total 12,463,955 This means that the consumption of Upper Silesian coal and coke in Ger- many within her present boundaries amounted altogether to only 12,463,955 tons. This makes only 8.9 per cent, of the total pre-war coal ccmsumption in Germany (140,088,866 tons), whereas, as we have seen above. Upper Sile- sian coal represented 40.4 per cent, of Poland's total pre-war consumption. From the above we can see plainly that the possession of Upper Silesian mines is not necessary to enable Germany to meet her coal requirements. Ger- many, despite the loss of the Saar Basin and Alsace Lorraine, will not only be able even without Upper Silesia to cover fully her interior requirements, but will also have considerable quantities of coal for exportation. The state- ment of Germany that, if she loses Upper Silesia, she will not be able to fulfill her coal obligations toward the Allied Powers, is quite unfounded. Un- doubtedly the Upper Silesian coal means for Germany a source of wealth. but it is not in any sense the basis of economic existence for Germany. Importance of Upper Silesian Coal for Poland The situation for Poland is quite different. The Dombrowa and Krakow coal basins can cover less than half of Poland's requirements, and Poland is bound to cover her deficiency with Upper Silesian coal. To this must be added the fact that neither the Dombrowa nor the Krakow Basins produce coking coal. Metallurgical coke, now that the Teschen question has been settled to Poland's disadvantage, can be supplied to Polish iron works only by Upper Silesia. If the Upper Silesian coal basin remains outside the Polish boundaries, Poland will be always dependent on her neighbors with regard to fuel. Thus the possession of the Upper Silesian mines is for Poland the first condition of economic independence. Finally, it must be taken into consideration that the economic life of the Polish territories during the last century, because they were divided by customs frontiers and attached to three different foreign economic organiza- tions, has developed under quite abnormal conditions. The governments of the states which participated in the partition of Poland, in their centralistic tendencies, always supported the industry and commerce of the provinces inhabited by their own predominant nationalities to the disadvantage of the sections of Poland belonging to them. Hence the customs duties and tariffs so detrimental to the Polish industry ; hence the entire indifference of the former Russian and Austrian governments with regard to transportation facilities .in former Congress Poland and Galicia (in 1912 there were for each 10 \ 1,000 square kibmeters in former Congress Poland only 25.5 kilometers of railways; m Ga hem only 52.3 kilometers, whereas in Belgium there were 160 kdometers and m Germany 113). Now that the Polish territories are united Polish industry, not being hindered by foreign governments, has many S bihties of quick development. To put her industry into operation shl need hovvever, coal, coal and once more coal, which can be supplied to her only by Upper Silesia. In other words, from whatever view one regards the coal question m Poland, one everywhere sees her dependency upon Upper Silesia. Iron Industry We will now take up the second most important branch of the Upper Silesian industry, namely the iron industry, and consider its position and possibilities _of_ development in case Upper Silesia is left with Germany and also m case it is united with Poland. -^ In the year 1913 there were in Upper Silesia thirtv-six blast furnaces of W mi r^ ^""/"' ""'"' ^" operation. These twenty-nine furnaces produced yy4,0Ul tons of pig iron, using as raw material the following: Sources of Raw Material for Iron Industry * Iron ore fi^m Upper Silesia 1 78 ols Iron ore from Posen yaln Iron ore frona abroad =;7r'n?i Iron ore from Germany '.'.'.'.'.'.'.'.'.'.'.'.'.'.'.'.." 260074 Manganese ore (imported into Germany from abroad) Burnt pyrites, etc. (almost exclusively of foreign orimn imported to Germany) " Scrap iron Slag and Scales A— Upper Silesian mj. ^'^n B-German (including Posen) .....■.:■.::■.■.:::::: pi' g ,s ^-^'^'^ :;:::: is^sis Tons 1,094,921 47,965 289,914 7,587 584,090 ,024,477 wlTf *''' "^"S™^-^*^ °« -^s =>" imported from abroad Uppes'^sra' -r\jyj,ooy Luiis, in lyiu to zoo,ozo tons and in 1QH tn 1 ^8 9nA +,^^o i l one-sixth of the production in 1890.** ' ^''"'' °' "^"'^ ^^^'^^ Thus the Upper Silesian iron industry has been forced to import most of the necessary ores from abroad, chiefly from Sweden and NorwaT BefX the ^or^ong toe to co.ne. A further great'dfficult^- will be the lack of ship- The following table shows clearly how Upper Silesia became more and more dependent on imported ores : Relative Importance of Imported Ores * Total Consump- Upper Sil esia Germany Foreign tion of Iron Ore Per Ce nt. of Per Cent. of Per Cent, of in Upper Silesia Total Tons Total Tons Total Tons Tons Consumpt ion Consumpt ion Consumption 1891.... 871,425 708,654 81.3 33,311 3.8 129,460 14.9 1895.... 902,109 604,272 67.0 34,584 3.8 263,253 29.2 1899.... 1,104,576 536,074 48.6 41,184 7>.l 527,318 47.7 1903.... 1,028,446 420,629 40.9 55,041 5.4 552,776 7)Z.l 1907.... 1,208,053 292.077 24.2 129,603 10.7 786,373 65.1 1911.... 1,120,213 251,682 22.5 155,253 13.8 713,278 63.7 The increase of the proportion of German ore used is particularly to be ascribed to Posnanian ore which is included in the German figure. The im- port of ore from Germany proper in 1915, as shown above, still further in- creased, but it must be noted that Germany had then in her possession very rich oi-e mines in Alsace-Lorraince which now belong to France, so that the supplying of Upper Silesia with German ore will be more difficult. At the same time in Polish territories, in the near vicinity of Upper Si- lesia, there are very large deposits of iron ore which will be able to serve the Upper Silesian metallurgical industry in case Upper Silesia is united with Poland. Deposits of iron ore exist in all territories of Poland, the richest being in former Congress Poland. More exact investigations which have been made in the western part of Congress Poland show that there are deposits of iron ores estimated by Professor Bogdanowicz at 300,000,000 tons (by other experts still higher). It is true that this ore contains not more than thirty to forty per cent, of iron, but it smelts easily and when mixed with ore with a higher percentage of iron is an excellent raw material. The ore industry in Congress Poland was developing before the war under spe- cially difficult conditions, as the export of Polish iron ore abroad was made impossible on account of prohibitions of export of iron ore from Russia by land. Notwithstanding this, the production of iron ore increased during the last pre-war years very considerably. The following table shows the increase of the iron ore production in former Congress Poland.** Tons 1909 123,091 1910 167,065 191 1 257.374 1912 294,114 1913 310,623 The increase from 1909 to 1913 was 187,532 tons, or 152 per cent. If one compares this increase of production of iron ore in Congress Poland with the decrease of iron ore production in Upper Silesia, one sees at once that Poland is the logical source of supply for Upper Silesia. As mentioned before, the production of pig iron in Upper Silesia amounted in 1913 to 994,601 tons. This production had been increasing during the last pre-war years very slowly. It amounted to :*** Tons 1909 849.776 1910 901,366 1911 • 963,382 1912 • 1.048,356 1913 994,601 *Handt)ook of Upper Silesian Industry. **Mining' and Metallurgical Industry in Cong'ress Poland. ***Handbook of Upper Silesian Industry. Report of the Upper Silesian Mining and Metallurg'ical Industry. Vear Book of the Breslau Mining- District. 12 From 1909 to 1913 the production therefore increased by only 144,825 tons, or 17 per cent. ; from 1912 to 1913 the production even decreased by 53,755 tons, or 5.1 per cent. At the same time the total German production of pig iron increased from 12,917,653 tons in 1909 to 17,852,571 in 1912, and to 19,276,000 in 1913; that is from 1909 to 1913, or during a period in which the Upper Silesian pig iron production increased altogether only by 17 per cent., the total German production had increased by 6,358,000 tons, or by 50 per cent., and that from 1912 to 1913, Germany as a total shows an increase of 1,423,000 tons, or 7.97 per cent., whereas Upper Silesia shows a decrease of 5.1 per cent. On account of this the ratio of pig iron production in Upper Silesia to the total pig iron production in Germany, which has always been expressed by a very inconsiderable figure, has undergone during recent years a still further reduction. In 1871 the pig iron produced in Upper Silesia was 14.8 per cent, of the total pig iron production in Germany : In 1891, 10.3 per cent.; 1901, 8.1 per cent.; 1910, 6.1 per cent.; 1911, 6.21 per cent.; 1912, 5.92 per cent.; 1913, 5.16 per cent. If we consider now the data regarding the sale of pig iron and iron products, we shall find how small was the role of the Upper Silesian iron industry in supplying Germany's requirements, and how, on the other hand, the development of this industry depends upon its relations with other Polish territories. In the following table is shown the production of pig iron in Upper Silesia and the shipments to points outside of Upper Silesia. Iron Shipments from Upper Silesia * Shi pments to Rai way Sliip- Sh pments Po ish Terri- ments to Points Per Cent. Points Out- lories Belong- | Production of Out side of Upper of Produc ■ sic e of ing Formerly Pij J Iron Silesia tion. Ge rmany to Russia Tons Tons Tons Tons 1884 . . . 410,330 50,750 12.4 48,037 43,591 1886 . . . 372,875 72,391 19.4 63,663 62,534 1887 ... 395,611 37,114 9.4 28,859 28,215 1891 . . . 479,806 10,897 2.3 1,430 906 1901 . . . 641,726 29,365 4.6 10,060 537 1911 . . . 963,382 64,434 6.7 14,130 6,588 1912 ... 1,048,356 82,794 7.9 38,598 6,268 1913 . . . 994,601 51,118 5.1 17,105 4,903 From the above figures it can be seen that in 1886 about 20 per cent, of the total production of pig iron was exported to points outside Upper Silesia, in 1913 only 5.1 per cent. This decrease parallels the decrease of the export to Polish territories belonging formerly to Russia. In 1886 the export of Upper Silesian pig iron to those territories amounted to more than the total shipments to points outside Upper Silesia in 1913. Evidently the Polish terri- tories are the natural market for Upper Silesian pig iron. Through artificial means this market was closed to her in 1887. In this year, namely, Russia increased the duty on pig iron from six kopeks to thirty kopeks per 100 kilo- grams (from marks, 1.19, to marks, 5.95 per 100 kilograms). In the year 1891 there followed a further increase to 35 kopeks (marks, 6.94). From the mo- ment when the Polish market was thus closed the importance of the Upper Silesian pig iron became only local and consequently the production of Upper Silesian pig iron, in proportion to the production of the whole of Germany, continually declined. sCGerman Government Repoi-t of Merchandise Shipments on German Railways. 13 With regard to finished manufactures of Upper Silesian iron factories the situation is similar, as shown by the following table : Manufactured Products Exported by Upper Silesia* Total Railway Ship- ments of Iron Goods Shipments to Polish Including Shipments Territories Belong- to Points Within Shipments Outside ing Formerly to Upper Silesia of Germany Russia Tons Tons Per Cent. Tons 1884 ... 267,697 42.976 16.1 23,219 1895 485,563 135,913 28.0 105,251 1900 662,286 51,586 7.8 28,498 1911 1,271,206 80,393 6.3 6,678 1912 1,448,986 135,865 9.4 10.262 1913 1,396,30-3 117,241 8.4 22,587 Here also the expansion of the Upper Silesian industry was hindered through the closing of the Polish markets by Russian customs duties intro- duced in 1881, 1882, 1887 and 1891. The decrease of the customs duties in the year 1894, although by a small percentage only, made it possible for the Upper Silesian iron industry to increase, for a certain time, the export to Polish territories formerly under Russian rule. From 1884 to 1911 the export from Upper Silesia increased from 42,976 tons to 80,393 tons, or by 87 per cent., whereas the total export from Ger- many of goods of the same kind increased during this period by 410 per cent. For the interior German markets the Upper Silesian iron industry has only a very small significance. This industry has been able to control the market only in Upper Silesia. The iron requirements of that part of Silesia outside of Upper Silesia were supplied by Upper Silesia only to the ex- tent of about 50 per cent, the requirements of Posen to not much over ZSYs per cent., and the requirements of other markets even situated near to Upper Silesia, such as West Prussia, Pomerania, Saxony and Brandenburg, only in very small degree. The importance of the Upper Silesian iron industry in supplying even these nearest markets has been constantly decreasing. The consumption of Upper Silesian iron as compared with the total iron consumption was in per cent, as follows : Drop in Consumption of Upper Silesian Iron Products** Silesia West & East (Excl . Upper Silesia) Posnania Prussia Berlin Brandenburg Saxony 1884. 63.7 44.7 20.8 19.7 15.6 16.6 1911. 55.2 35.7 17.8 14.5 12.8 12.2 It must be added that in the above table not the total consumption of iron Avas taken into consideration, but only that of the iron products which were manufactured in Upper Silesia and transported by railway. If one should take into consideration the total consumption of iron in the above mentioned territories, one would, in view of the fact that Upper Silesia does not produce various kinds of iron products at all, and that those territories to a large extent used iron brought from Western Germany by waterways, find the picture for Upper Silesia still less favorable. We see, therefore, that here also the figures speak for themselves. Ap- parently the economic conditions of Germany do not give to Upper Silesia's iron industry the same basis for development as to the industrial districts of Germany proper; on the contrary, the connection of Upper Silesia with ♦German Government Report of Merchan'Sise Shipments on German Railways. **Handbook of Upper Silesian Industry. 14 Germany has rather hindered the development of the Upper Silesian iron industry. We will try to explain some of the reasons for this condition. First of all, in geographical situation Upper Silesia belongs rather to Poland than to Germany. Located between Galicia and Congress Poland, the Upper Silesian manufactures had to move more than 100 kilometers, be- fore they reached the nearest German markets. Now that Posnania and West Prussia have become a part of the Polish State, the situation of Upper Silesia, in case it should be left with Germany, would be still more unfavor- able. Upper Silesia has no waterway connections with Germany except by the River Oder, which in its upper part is very unsuitable for navigation (on account of strong currents in spring and low water during the summer). The Upper Silesian products can therefore move by the chief waterway only to a very small extent. On the other hand, the chief industrial district of Germany proper in the Rhine provinces has at its disposition the splendid waterway of the Rhine, so that it can transport goods to the sea, and then, through Hamburg, Stettin and the river basins of the Elbe and Oder, to Eastern Germany comparatively cheaper than can Upper Silesia. For the same reasons Upper Silesia, if left with Germany, will be threatened by com- petition from German iron foundries situated on the Baltic, and even from the foreign iron industry. The cost of producing iron in Upper Silesia is considerably higher than in the west of Germany, because the Upper Silesian coke is softer and is not as suitable for metallurgical purposes as the Westphalian coke. The blast furnaces in Upper Silesia must therefore be constructed of smaller dimen- sions than in the west of Germany. In 1910 the average production per furnace in Upper Sielsia was 31,100 tons of pig iron, whereas the average for the whole of Germany was 48,800 tons and for the Dusseldorf district 71,360 tons. To produce 1.000 tons of pig iron there were employed on the average in 1910 in Upper Silesia 5.4 workmen, in Germany as a whole 3.1 workmen and in the Dusseldorf district 2.7 workmen.* Also with regard to the supply of ores the Western German metallurgical industry is in a better situation than the Upper Silesian industry, as it pos- sesses its own ore mines (in the Rhineland), and has the possibility of import- ing iron ore by the cheap waterway. Thanks to the good connections with seaports by waterways, the iron industry of Western Germany could develop its export, which became im- possible for Upper Silesia from the moment Russia introduced prohibitive customs duties. Because of the above reasons there has been practically no opportunity for the development of the Upper Silesian iron industry within the boun- daries of Germany. As we have seen above, even in the nearest markets in Eastern Prussia the Upper Silesian industry has been forced into second place by the German competition. To hold these markets the Upper Silesian iron industry had to make heavy financial sacrifices, especially as the sale of the so-called by-products (rolled iron, pipes, sheet iron, etc.), has not been combined in Germany in one syndicate. For this reason the earnings of the companies engaged in the iron industry in Upper Silesia were before the war insignificant and many of them worked at a loss. The fact that the condition of the iron industry in Upper Silesia was very serious was confirmed by competent authorities. The above mentioned hand- book of the Upper Silesian industrial district mentions specifically the "very difficult situation of the iron industry in Upper Silesia" (page 433), and it must be noted that this handbook was edited by the Upper Silesian Mining and Metallurgical Association (the organization having the closest contact with the iron industry). To what extent the Polish territories formerly under Russian rule are a natural market for the Upper Silesian iron industry is shown by the fact ^Handbook of "Upper Silesian Industry, 15 that after the Russian Government had created an artificial wall between Upper Si esia and those territories through the establishment of high cus- toms taxes the Upper Silesian industry broke through this wall After tryear 1880 a number of iron factories were created m Congress Po and either directly by Upper Silesian companies as their branches, or m close r-r.ntnrt with the Upper Silesian industry. Kle^p^nsLZ\he Upper Silesian iron industry to the east toward Polish territories proves that the leaders of the industry clearly see that the "^^The ^ZX^'i^tXe^ in the territories now fon.ing the Polish State only to a very inconsiderable extent. Blast furnaces are to be found onW in Congress Poland. Their number amounted in 1913 to thirteen, of whfch elevef were^o^^^^^^ They produced in that year 418 708 tons of ^igton The production of^pig iron in Congress Poland since 1909 is shown by the following table:* ^^^ long ...'. 215!830 ]l% 250,827 ;^ V 346,900 j^}3 :::::::::;. 418,708 Thus from 1909 to 1913 the production increased by 202,878 tons, or 94 per cent, (the corresponding figure for Upper Silesia is 17 per cent.; for all ^'Tkr^genumbeTof blast furnaces and iron mills in Congress Poland were destroyed or considerably damaged during the war; but even if we should assume that it will be possible to reconstruct these mils ^n ^..^^.^^/^^^^ (which under the present conditions is not possible), and even if then pro duction should grow further in the same proportion as before the war even then the production of iron works in territories forming the present Polish State would be quite insufficient to cover the interior requirements. Of all the Polish territories now united only Congress Poland has really a large iron industrv. and this industry now has to supply the_ requirements of GaHcia and of former German Poland, which obtained their supplies before the war, either in Bohemia and Austria, or in Upper Silesia and Western Germany. Congress Poland also has to meet the demands for iron of all the fornier Russkn Poland, as apart from Congress Poland the Polish terri- tories belonging formerlv to Russia have no iron industry. The iron requirements of Poland will probably grow much more rapidly than before the war. On account of the unfavorable economic situa- tion in which the Polish territories were held under foreign governments, the consumption of iron per head of population before the war was very ^"""it' amounted vearly, in Congress Poland to 19.4 kilograms, in Posnania to 96 kilograms,' in Western Prussia to 62 kilograms ; whereas the corre- sponding figures were for the United States, 303 kilograms; Germany, 137 kilograms; England, 112 kilograms; France, 92 kilograms, and Belgium, 121 kilograms. Iron Prices in Upper Silesia and Congress Poland (In German marks for one ton, one rouble being calculated as marks, 2.16) Congress Poland Upper Silesia D- • 92 72-79 P^^ '■'°".-:-. 176 120-130 Commercial iron /^ ^^^ Sheet iron *Mining' and Metallurgical Industry in Cong'ress Poland. 16 The above figures show clearly how little the Polish market is saturated with iron, and what a field it offers for the Upper Silesian iron industry. Enormous quantities of iron will be needed solely to bring the railways up to the Western European standard. An interesting light on the more favorable market which Polish territories could have offered to Upper Silesia before the war is obtained by a compari- son of iron prices in 1913 in Upper Silesia and in Congress Poland. (Page 16.) From the above mentioned it follows that the Upper Silesian iron indus- try, similarly to the coal industry, is only connected with the economic life of Germany proper by very loose ties ; the fact that Upper Silesia belonged to Germany, not only did not encourage the development, but, on the contrary, kept the development' down, on account of the competition of Western Germany — and that the natural markets for this branch of the Upper Sile- sian indvistry are Polish territories which will be open for Upper Silesia when it is united with Poland. Zinc Industry The third most important industry in Upper Silesia is the zinc industry. It was principally an exporting industry, always in close touch with the Polish markets. Upper Silesia produced zinc as follows : Zinc Production in Upper Silesia * Year Tons of Zinc 1881 67,000 1900 102,000 1907 138,000 1911 156,000 1912 168,496 Upper Silesia rolling mills worked approximately 30 to 40 per cent, of this into sheets, etc. The export by railways froni Upper Silesia to points outside of Germany is shown by the following table : Exports of Zinc from Upper Silesia** Railway shipments from Upper Silesia to points To Polish Territories Percentages of Total outside of Germany — Belonging Formerly Shipments to Points Vear Zinc and zinc goods to Russia Outside of Germany Tons Tons 1887 15,270 167 1.1 1899 19,255 3,544 18.5 1907 30,328 5,902 19.5 1911 38,029 11,475 30.2 1912 36,839 8,024 22. 1913 39,937 14,462 36.2 Besides, certain quantities of zinc and zinc goods have been shipped from Upper Silesia to Galicia, namely, in 1911, 2,681 tons; in 1912, 4,156 tons; in 1913, 4,388 tons; to Posnania and Western Prussia, about 1,000 tons yearly. This percentage with regard to all the Polish territories is therefore still larger. In the year 1913 the now united Polish territories received from Upper Si- lesia 50 per cent, of the total Upper Silesian railway export of zinc and zinc goods. In comparison to the world's production, the production of zinc in Upper Silesia has decreased during the recent years. This decrease is shown by ♦German Government Report of Merchandise Shipm^ents on German Railways. **Handbook of Upper Silesian Industry. 17 the percentages of the world's production ; from 25.4 per cent, in the year 1881 to 21.4 per cent in 1900, 18.7 per cent, in 1907 and 17.4 per cent in 1911. The principal reason for this smaller development of the Upper Silesian. zinc industry were: (1) the difficult sale conditions for sulphuric acid (one of the by-products of zinc), as the German markets were over saturated with sulphuric acid, and (2) high custom duties maintained by Russia for the Polish territories formerly under Russian rule. Upper Silesia when united with Poland will find there is a good market for sulphuric acid, which can be taken advantage of as the present production in Poland is much belo^v the requirements. No other branches of the Upper Silesian industries will be discussed in detail. It will only be mentioned that for nearly all' the articles of these industries (by-products of the coking process of coal ; artificial fertilizers — explosives for the mining industries, etc.), Poland offers an excellent market,, as there are no such industries well developed in Poland. In the same way as most of the industrial products of Upper Silesia have a natural market offered by Poland, and therefore such industry directs its- expansion toward Poland, so also with regard to the supply of raw material and foodstufifs. Upper Silesia depends on Poland. Raw Material and Food Imported from Poland to Upper Silesia Iron ores have been mentioned above. With regard to the supply of wood. Upper Silesia depends entirely on Polish territories. Germany is quite unable to deliver to Upper Silesia sufficient wood. Forests in the Breslau and Lignitz districts are absorbed by the requirements of the cellu- lose industry, and other German forests are too far from Upper Silesia to be considered. The following tables give details with regard to the origin of wood im- ported to Upper Silesia in the years 1911 to 1913, including the importation by railways to Upper Silesia of edged timber, finished wood, fuel wood and mining timbers: Lumber Imports to Upper Silesia * Year Total Out of This Quantity There Was Supplied by: Former Rus- sian Poland Outside of Former Congress Congress German Total from Poland Poland Galicia Poland Poland Tons Tons Tons Tons Tons Tons 1911 504,694 107,206 39,213 215,107 6,986 368,512 1912 566,201 151,433 32,350 209,070 16,464 409,317 1913 640,656 149,311 36,599 259,497 32,457 477,644 NOTE— In th s and in the following ta ble regarding agricultural products and cattle the imp ortation from the whole former German provinces of Posnania and West ern Prussia is included. Some very small quantities should be deducted | for parts of those P' -ovinces which were left to Germany It must be mentioned that the importation of wood to Upper Silesia from points outside Germany has been hindered by rather high import taxes so that most probably the importation of wood from Polish territories would be still greater, if there were no artificial hindrances. Regarding foodstufiis (agricultural products and cattle). Upper Silesia, to a large extent, has been depending on territories now forming the Polish State. The temporary decrease of agricultural production in Poland has beert H:Gerinan Government Report of nxercliandise Shipments on German Railways. Commercial Balance of the Former German Poland (A. Rose). 18 primarily caused by the stopping of the importation of artificial fertilizers. If Upper Silesia is united with Poland, the requirements of Poland for arti- ficial fertilizers will be covered by Upper Silesia, which has the largest factory of super-phosphates on the continent. Then the Polish agricultural production will regain its former level. The importation by railway to Upper Silesia from points outside her boundaries of agricultural products, cattle and horses, was as follows: Imports of Livestock and Food Products * Year Total Out of This Quanti ty There Was Suppliec 1 by Russian Po- land Outside Former Congress Congress German Total from Poland Poland Galicia Poland Poland WHEAT Tons Tons Tons Tons Tons Tons 1911 7,035 832 1,352 1,034 992 4,210 1912 9,468 ISO 615 2,314 1,243 4,322 RYE 1911 34,422 786 2,646 6,486 14,518 24,436 1912 35,022 2,269 807 6,463 11,925 21,464 OATS 1911 5,766 3,980 99 362 241 4,682 1912 4,689 217 14 827 1,980 3,038 BARLEY 1911 26,039 5,284 4,319 9,923 2,11 19,848 1912 25,742 7,455 3,880 11,031 467 22,833 POTATOES 1911 81.235 29,930 31,348 2,318 6,695 70,291 1912 91,368 35,464 32,963 IZl 9,594 l^:]li FLOUR AND GRITS 1911 46,572 12 — 41 19,832 19,915 1912 44,994 40 20 2>1 15,347 15,489 MILLETS AND LEGUMINOUS SEEDS (PULSES) 1911 16,046 6.784 762 6,948 121 14,615 1912 12,554 6,416 1,102 3,591 161 11,270 HORSES (HEADS) 1911 4,190 510 — 408 538 1,453 1912 4,677 518 973 145 1,043 2,679 SWINE AND SHEEP 1911 168,317 88,043 — — 57,845 145,888 1912 142,053 73,555 17,790 — 27,730 120,075 POULTRY (HEADS) 1911 743,527 21,900 41,150 642,544 11,316 716,910 1912 314,760 1,983 122,685 167,840 4,912 297,400 Conclusion It follows clearly that Upper Silesia and other Polish territories form an inseparable economic unit. These territories were before the war separated by customs lines. They belonged to different economic organisms. Notwith- standing this, they have, as herein shown, ofifered one to the other necessities of such a nature that there has been large interchange of goods in spite of political hindrances. Poland, without the Upper Silesian coal and iron, will never be able to become independent in her economic life. Upper Silesia depends upon Po- land for a supply of raw materials and food articles. Germany is absolutely unable to give Upper Silesia what Poland can give her, viz. : markets for the Upper Silesian industrial products and raw materials for her industries. Upper Silesia and Poland will flourish only when they are united into one economic unit. ♦ German Government Report of Merchandise Shipments on German Railways. Commercial Balance of the Former German Poland (A. Rose). 19 LIBRARY OF CONGRESS 020 930 486 7 »K«pr\o oWielun 'Oeh f'"-^^. *-*Brcslau Br leg' Y Kluczbork ) / Kadomsko )Cze5tochoNMa Przedborz \ Germany f ^^^^c^ RSkrlV' c^a- o^ w.Strzelce/ A^^ J ^ Poland The Upper Silesian Plebiscite District Upper Silesia, where a plebiscite will be held in the near future, is one of the richest coal and mineral regions in Europe. It embraces an area of approximately 5,000 square miles and has a population of about 2,200,000. According to reliable statistics, approximately 62 per cent, of the population is Polish. The greatest wealth of the region is derived from the coal deposits. Important deposits of iron, zinc and lead have also been developed. The iron and steel industry, relying wholly on coal produced within the region, and on both imported and locally produced ores, has grown to large proportions. Though primarily a mining and factory district. Upper Silesia is not without agricultural resources, and produces a considerable portion of the food needed for home consumption. Ethnographically, Upper Si- lesia has for centuries been strongly Polish, but in the matter of politi- cal associations its history has been varied, belonging at various periods to Poland, to Austria, and to Prussia. Both Germany and Poland claim Upper Silesia. Germany bases her claim entirely on economic grounds, largely because of the German own- ership of mines and property. Poland bases her claim on economic and racial grounds. To Germany the region means only a source of greater wealth, whereas to Poland it is essential to economic independence. Germany, for instance, received only 8.9 per cent, of her pre-war coal from Upper Silesia, while over 40 per cent, of Poland's coal supply came from the now disputed district. \ LIBRftRV OF CONGRESS ilii 020 930 486 7 ^ Metal Edge, Inc. 2007 i^AX