•f' THE UNIVERSITY LIBRARY THE PENNSYLVJ hVERSITY . SYLVAN1A MATERIALS SURVEY RUBBER Compiled for the NATIONAL SECURITY RESOURCES BOARD by the UNITED STATES DEPARTMENT OF COMMERCE NATIONAL PRODUCTION AUTHORITY December 1952 For sale by the Superintendent of Documents, U. S. Government Printing Office Washington 25, D. C. - Price $1.50 (Paper cover) Digitized by the Internet Archive in 2012 with funding from LYRASIS Members and Sloan Foundation http://archive.org/details/materialssurveyrOOunit Table of Contents Page I. Definition and Description of Rubber Types 1 A. Natural Rubber I B. Synthetic or Chemical Rubbers (GR-S, Butyl, NeoDrene. N-Type) 3 C. Reel aimed Rubber 4 Tables I, A( 1) Wild Rubbers and Sources 1 A(2) Plantation Rubber Types and Grades 2 C( 1) Types of Reclaimed Rubber 5 II. Competitive Materials 1 III. Production Processes and Possible Problems 1 A. Natural Rubber 1 B. Synthetic Rubber 1 C. Reclaimed Rubber 3 Tables III, C( 1) Types of Scrap Rubber 3 C(2) Flow Diagram of Digester Reclaiming Process 5 IV. Raw Material Sources 1 A. Natural Rubber 1 Text Table IV, A( 1) Estimated Potential Production Capacity 1 B. Synthetic Rubbers 2 C. Reel aimed Rubber 4 Tables IV, B(l) Operators of Government-Owned Butadiene and Styrene Facilities 2 B(2) Operators of Government-Owned Butyl Rubber Facilities 2 B(3) Operators of Government -Owned GR-S Copolymer Facilities 3 V. Raw Material Production 1 \. Natural Rubber 1 B. Synthetic Rubber 4 C. Reclaimed Rubber 6 Tables V, A(l) Estimated World Production of Natural Rubber, 1935-50 2 A(2) Net Exports of Natural Latex from Producing Countries, 1935-50. ., 3 B(l) Production of Synthetic Rubber in United States and Canada, 1939-50.... 4 B( 2) U, S. Synthetic Latices Production 5 B(3) Synthetic Rubber Production in Germany, 1937-49 5 C( 1) U. S. Production of Reclaimed Rubber, Unit Value of Natural Rubber Im- ports, and Market Price of #1 R.S.S. , 1935-50 6 C(2) Production of Reclaimed Rubber in Certain Foreign Countries, 1945-50... 7 VI. United States Imports, Exports, and Reexports 1 A. Natural Rubber 1 P. Synthetic Rubber , 5 C. Reclaimed Rubber 6 Tables VI, A(l) U. S. Gross Imports, Reexports and New Imports of Natural Rubber, 1925-50... 2 A(2) U. S. Imports of Natural Rubber from Chief Sources, 1935-50 3 A( 3) U. S. Imports of Natural Latex by Sources, 1936- 50 3 A(4) U. S. Imports of Total Natural Rubber and Natural Latex, by Ports of Entry, 1946-50 4 A( 5) U. S. Imports of Natural Rubber by Types, 1Q4A- 50 4 B( 1) U. S. Imports of Synthetic Rubber from Canada, 1943- 50 5 B(2) U. S. Exports of Synthetic Rubber, 1941-50 6 C( 1) U. S. Imports and Exports of Reclaimed Rubber 6 VII. Imports, Exports, and Reexports, Significant Foreign Countries 1 A. Natural Rubber 1 Text Table, Malayan Imports, 1949-50 1 B. Synthetic Rubber 5 Text Table, Estimated Foreign Consumption, 1940-50 5 C. Reclaimed Rubber 5 Tables VII, A(l) Estimated New Supply of Natural Rubber, Principal Countries, 1936-40 and 1Q46-50 3 A(2) Estimated Net Imports of Natural Latex, Principal Countries, 1946-50.. 3 A(3) Netherlands in Transit Shipments, Natural Rubber, 1947-50 4 A( 4) U. K. Reexports of Natural Rubber, 1946- 50 4 Page VIII. World Stocks of Rubber. 1 A. Natural Rubber 1 Text Table, Estimated Natural Rubber Afloat, Year-End, 1O46-50 2 B. Synthetic Rubber 4 C. Reel aimed Rubber 7 Tables VTTI, A(l) Estimated Year-End Stocks of Natural Rubber in Producing Countries, 1946-50 1 A(2) Estimated Stocks of Natural Rubber in Foreign Consuming Countries, 1040- 50 2 A(3) Estimated Stocks of Natural Rubber in the United States, 1921-50... 3 B(l) Estimated Stocks of Synthetic Rubber Outside the United States, 1<»40- 50 5 B(2) Stocks of Synthetic Rubber in the United States, l°41-50 5 B(3) U. S. Stocks of S-Type Rubber, Government and Industry 6 C( 1) Reported Stocks of Reclaimed Rubber 7 IX. Rubber Consumption 1 A. World Consumption of Natural and Synthetic Rubber 1 R. United States 2 (a) Consumption of Rubber by Types 2 ( b) Consumption of Rubber by Uses 4 (c) Transport and Non- transport Consumption 6 (d) Rubber Industry Requirements for Certain Non-Rubber Materials 14 C. Foreign Countries 15 Tables IX, A(l) World Consumption of Natural and Synthetic Rubber, 1020-50 1 B(l) U. S. Estimated Consumption of Natural, Synthetic and Reclaimed Rub- ber by Types, 1935-50 3 P/2) U. S. Consumption of Natural Rubber by Classes of Products, 1935-40.. 4 B(3) Estimated U. S. Consumption of New Rubber by Products, 1941 and 1949.. 5 B(4) U. S. Estimated Consumption, by Types of Rubber, Transport Compared with Non-transport, 1935-50 6 B(5) Estimated New Rubber Consumed in Tires and Other Products, 1944-46... 8 B(6) U. S. Consumption by Types, Transportation, Non-transport and Insu- lated Wires, 1947-50 9 B(7) Annual Requirements of Major Non-Rubber Materials Used in U. S. Rub- ber Manufacturing Industry 9 P(8) Type of Rubber as Percent of Total Proposed Rubber Consumption, Third Quarter 1951 '. 10 B(9) Type of Rubber in Each Product as Percent of Total Consumption of that Type, Third Quarter 1951 11 B(10) Comparison of Third Quarter 1951 Requirements of New PHC and Re- claim, and Percent Reclaim 13 C(l) Estimated Foreign Consumption of New Rubber, Principal Countries, 1946- 55. 15 C(2) United Kingdom Consumption of Natural versus Synthetic Rubber in Non- transport Goods, 1945- 46 16 C(3) Consumption of Reclaimed Rubber in Certain Countries, l°45-50 16 X. Rubber Prices 1 A. Natural Rubber 1 B. Synthetic Rubbers. 3 C. Reel aimed Rubber 4 Tables X, A(l)No. 1R.S.S. Spot Closing Prices, 1920-50 1 A(2) New York Spot Rubber Prices 1900-1920 2 A(3) Monthly Average— New York Spot Price— No. 1R.S.S. , 1947-51 3 A(4) Monthly Declared Value of United States Natural Rubber Imports 1947-51, (Dry Rubber, Latex and Guayule) 3 B(l) U. S. Government Selling Prices for Synthetic Rubber, 1942-51 4 XI. Organizational Facilities 1 A. United States Government 1 B. United States Industry 1 C. Foreign Countries 2 Table XI, C( 1) Factories of Chief Companies, by Countries 3 XII. Government Controls and Experiences 1 A. World War II 1 B. Post World War II 3 C International Rubber Control Efforts 4 XIII. Bibliography 1 Definition and Description of Rubber Types I Definition and Description of Rubber Types A. NATURAL RUBBER Natural rubber occurs in many different forms of plant life— trees, shrubs, vines, smaller plants, and tubers — growing in various parts of the world, but mainly in the equatorial and sub-tropical regions. Until 1900, the world's rubber came en- tirely from uncultivated plants, mainly from trees in tropical America and trees and vines in Africa. Castilloa trees indigenous to Central and northern South America were the leading source of rubber until about 1875, after that Hevea trees indige- nous to the Amazon Valley held the lead. Llandolphia vines and Funtumia Elastica trees in Africa became important sources starting about 1880. Guayule shrubs (Mexico and Southern Texas) have been exploited for rubber since 1905. A rising price trend for rubber from 1840 to 1910 led to the commercial exploitation of all worth-while wild rubber sources. The search for rubber promoted exploration of little-known and remote tropical regions during this period. It also stimulated efforts to produce rubber from trees planted for that purpose, from 1870 onwards. A list of the principal types and grades of wild rubber still traded are shown in table I, A(l). The general sources of each type are indicated. These rubbers are today of little importance internationally except that in a time of emergency they might again be more fully exploited as they were during World War II. The first rubber planters experimented with many different trees, but the Hevea tree gained supremacy at an early date in the plantation industry which started in Ceylon and Malaya, and spread to what is now Indonesia, as well as British Borneo, Indochina, India, Burma, and Thailand, and more recently Liberia, other West African countries, and the Philippine Islands. A destructive leaf disease, scarcity of labor, and instability of governments in tropical American countries, were the chief barriers there to Hevea plantation developments, which are as yet of negligible im- portance. Today, over 95 percent of the production capacity for natural rubber is in Southeast Asia and nearby islands. The principal grades of wild rubber which are still occasionally traded inter- nationally include: Table I, A( I ) — WILD RUBBERS Paras: (from South America, chiefly Amazon Basin) Upriver fine Upriver fine, washed and dried Upriver coarse Upriver coarse, washed and dried Islands fine Islands fine, washed and dried Acre, Bol ivian fine Acre, Bolivian fine, washed and dried Beni, Bol ivian fine Madei ra fine Caucho: (from Central America and northern South America) Upper bal 1 Upper ball, washed and dried Lower ball Africans: (from West Coast of Africa) Rio Munez Black Kassai Prime Niger flake The plantation rubber industry in the Far East quickly assumed a capitalistic form of enterprise, large companies owned by Europeans, Asiatics, and some Americans, 1-1 operating estates mostly under white management, employing chiefly Indian and Chinese labor in Malaya, Javanese in Indonesia, and local labor elsewhere. As the workers learned to plant trees, tap, and prepare rubber, a native rubber industry sprang up alongside the estate industry. Today the native industry accounts for roughly a quarter of the production in Ceylon, 45 percent in Malaya, three- fourths in Indonesia, and nearly all the Thai output. In British Borneo, Sarawak production is two-thirds native rubber, while North Borneo is mainly estate. In Indochina, where plantations became important only in the late 1920' s, native participation is as yet negligible. It is noteworthy that in 1950, native rubber from Indonesia and Malaya accounted for 28 percent and 17 percent respectively of the total world pro- duction of natural rubber. The growth of the native industry since 1920 was greatly stimulated in Indonesia, Thailand and British Borneo by the price effects of the British Rubber Restriction Scheme of 1922-28 and the International Rubber Regulation Scheme of 1934-43, while the development of plantations in Liberia and the Philip- pines, and experimental plantations in tropical America, stem from the same effects. The American rubber manufacturing and trading interests have been influential in the establishment of trade classifications and standards for natural rubber, of which the United States has always been the leading importing country. A list of the type descriptions of plantation Hevea rubber established by the Rubber Manufac- turers Association, Inc. , and endorsed by the Rubber Trade Association of New York, Inc., is attached. [1, A(2).] Since World War II, adherence to standards by Far Eastern shippers has been faulty. The large estates produce most of the high quality Ribbed Smoked Sheets, the Latex Crepes, and all the latices shipped in liquid form — mainly concentrates. The other types and grades cover rubber mainly of native origin, much of which requires treatment (cleaning and drying in Far East remilling plants) before shipment to con- suming markets. For high quality natural rubber and latex, the world is dependent on what appears to be a dwindling or at best a static estate output; for the lower grades the world is dependent on natives whose output lacks uniformity and cleanli- ness. Rubber is taken from the Hevea tree in the form of a liquid, known as latex. The dry rubber content of normal latex averages approximately 3 1/2 pounds to the Imperial gallon (1.20032 US gallons). The water content of normal latex is about 65 percent. To reduce transportation costs, much of the water is removed by centri- fuging and/or creaming before international shipment of the concentrates. Latex of 60 percent dry rubber content is considered the most desirable form by many consum- ing companies. While shipped to small consumers in drums of 25 or 50 Imperial gal- lons to some extent, the bulk movement is in tank steamers from producing to consum- ing countries, and in tank cars in the United States. In bulk shipments the loading and discharge facilities are similar to those used for handling petroleum. The following type descriptions of hevea rubber of plantation origin have been adopted by The Rubber Manufacturers Association and endorsed by The Rubber Trade Association of New York, Inc. Table I, A(2). — PLANTATION RUBBER TYPES AND GRADES Ribbed Smoked Sheets: No. IX— Superior Quality Ribbed Smoked Sheets, European Estates No. I— Standard Quality Ribbed Smoked Sheets No. 2 — Good Fair Average Quality Ribbed Smoked Sheets No. 3 — Fair Average Quality Ribbed Smoked Sheets No. 4 — Low Fair Average Quality Ribbed Smoked Sheets No. 5— Inferior Fair Average Quality Ribbed Smoked Sheets Thick Latex Crepes: No. IX— Superior Quality Thick Pale Latex Crepe No. I — Standard Quality Thick Pale Latex Crepe No. 2 — Fair Average Quality Thick Palish Latex Crepe Thin Latex Crepes: No. IX — Superior Quality Thin Pale Latex Crepe No. I — Standard Quality Thin Pale Latex Crepe No. 2 — Fair Average Quality Thin Palish Latex Crepe 1-2 Table I, A(2). -PLANTATION RUBBEB TYPES AND GRADES -Continued Brown Crepes — European Estates: Thick Brown Crepes: 1 No. IX — Clean Thick Light Brown Crepe, European Estates No. 2X — Clean Thick Brown Crepe No. 3X — Brown to Dark Brown Thick Specky Crepe, European Estates Remilled Crepes: Th ick Crepes: No. I — Superior Clean Light Brown Remilled Blanket Crepe 1 No. 2— Clean Light Brown Remilled Blanket Crepe No. 3 — Clean Brown Remilled Blanket Crepe No. u — Brown to Dark Brown Remilled Blanket Crepe Thin Crepes: No. I — Superior Clean Thin Light Brown Remilled Crepe No. 2 — Clean Thin Light Brown Remilled Crepe No. 3 — Clean Thin Brown Remilled Crepe No. u. — Thin Brown to Dark Brown Specky Remilled Crepe No. 5 — Rolled Brown Crepe and/or Flat Bark Crepe 1 These types are provided for by description only. No official types establ ished. Numerous special forms of plantation rubber have been developed by estates in recent years. Examples are sprayed rubber compressed in solid blocks, rubber powder such as "Mealorub" for roadways, sole crepes of specific thicknesses to meet de- mands of shoe manufacturers, and the French-initiated "technically classified" rub- ber which is now under test. Guayule rubber, produced since 1905 from the shrub indigenous to Mexico, has received considerable attention because it can be grown within the United States. Except in times of rubber shortage, it has never been in strong demand. As marketed in the past, this rubber contains about 25 percent resin; deresination would in- crease its cost while improving its quality. It has been demonstrated that it can be grown on plantations, but not that it could ever Le a commercially practicable enterprise on a large scale. For strategic reasons, the United States Government continues to provide funds for experimental work on guayule and other plants which could produce rubber within our continental limits. Now that we have synthetic rub- ber, the possibility that we might sometime have recourse to domestic production of natural rubber appears remote. B. SYNTHETIC OR CHEMICAL RUBBERS While efforts were made to produce a chemical substitute for rubber in the pre- ceding century, and under the spur of all-time high prices for the natural product in 1909-12, success was achieved only in recent years and stemmed from strategic rather than economic considerations. Germany, in World War I, produced a few thousand tons of so-called "methyl rub- ber" suitable for use in hard rubber products. Soviet Russia in the 1920 's began the production of synthetic rubbers partly to reduce its dependence on imported rub- ber for strategic reasons and partly to save foreign exchange. In the early 1930's, Germany under Hitler devoted efforts to the development of synthetic rubbers in or- der to become independent of imports in the war which was even then anticipated in German high councils. In the United States, Dupont in 1931 announced Neoprene, various rubber companies had small pilot plants producing N-Type rubber at the time of the Pearl Harbor attack, and Standard Oil was producing small amounts of butyl in the laboratory. The conquest of the Far Eastern rubber-producing countries by Japan forced the United States Government into its huge program of synthetic rubber pro- duction. Note that except in the United States, the development has been entirely 1-3 under Government auspices and direction. The Canadian industry is an outgrowth of that in the United States, and is also a Government undertaking. The synthetic rubbers produced in the United States include: GR-S. — A general purpose rubber suitable for bulk usage in a wide range of applications to replace natural rubber. Chiefly employed in the production of tires (except the larger truck, bus, and other heavy duty tires), in camelback, rubber heels and soles, rubber tiling and flooring, mechanical rubber goods, wire insula- tion, etc. It is produced by the copolymerization of styrene and butadiene, origi- nally in the proportion of roughly one to three, more recently with an average of 23 percent bound styrene. An increasing part of the production now contains but 20 percent bound styrene. GR means Government Rubber; S signifies Styrene type. A small quantity of S-Type rubber is privately produced. GR-S is produced both in the intermediate form of latex, and in dry form with numerous sub- types in active demand. Butyl. — Produced by copolymerization at extremely low temperatures of isobutylene and isoprene, both petroleum derivatives. It is markedly superior to natural rubber in air retention, and is chiefly used in inner tubes of all kinds, where it has largely supplanted high grade natural rubber. This material is not compatible with natural rubber, from which it must be separately handled in factory operations. Inner tubes made from butyl are specially marked to facilitate segregation by scrap rubber dealers and reclaimers. Produced entirely by the Government in dry form, with several active sub-types. Neoprene . — A special purpose rubber produced by polymerization of chloroprene, which is made from acetylene, and hydrochloric acid. The chief characteristics are high resistance to mineral oils, heat, oxidation, ozone, sunlight and burning. Used almost wholly in non-transportation applications, in the fields of electrical wire coverings, mechanical, industrial, and specialty rubber products. Produced both in latex and dry forms. Domestic production entirely by du Pont with a wide range of subtypes. N-Type Rubbers. — These special purpose rubbers are copolymers of butadiene and acrylonitrile. They compete with Neoprene in applications where resistance to oil and gasoline is essential, particularly gasoline containing aromatic compounds. Produced entirely by private firms, both in latex and solid forms. Other Types. — Thiokol is the trade name for a group of polysulfide rubber-like materials finding application where high resistance to oils and chemicals which attack natural rubber is desired, and where its unpleasant odor is not a factor. High-styrene butadiene copolymers find application in paints, and as resins. Sili- cone rubber, despite extreme high cost, possesses such high resistance to extremes of temperature, that it is finding increasing use in numerous small applications. In addition there are many plastics which are similar to rubber in physical proper- ties and which are in increasing amounts being blended with the synthetic rubbers to improve desired properties. These plastics have also replaced many uses in which rubber was formerly required. C. RECLAIMED RUBBER The possibility of further utilization of rubber material obtained from factory scrap and from worn-out rubber products, as a measure of economy, engaged the atten- tion of early manufacturers of rubber goods. Regrinding factory scrap and using it in new products has been and still is a common practice. Reclaimed rubber as such, made from worn-out and discarded rubber products, is essentially an American contribution to rubber supply. By 1890, there were indepen- dent companies in this country producing reclaim by the acid process for sale to rubber manufacturers. With the initiation of the alkali process for destroying the textile content of scrap rubber, under the Marks patents, the industry grew rapidly, and from 1900 reclaim has been an alternative material used regularly in certain rubber products to replace new rubber, and finding larger use in a wider range of products whenever new rubber prices were unusually high or supplies scanty. It was successfully employed in combatting high prices for natural rubber in the 1925-29 period of British rubber restriction, to extend the limited supplies of new rubber in the early years of World War II before the output of synthetics reached large volume, and again in the year ended June 1951, while supplies of new rubber £ai use 1-4 by the American industry were insufficient to meet demand and consumption was re- stricted by Government regulations. The reclaiming processes, using scrap rubber products for raw material, involve grinding the material into particles, destroying textiles by acid or alkali treat-. ment, reducing the material to fluid condition with addition of oils in digesters, screening out metallic particles, drying and calendering the resulting reclaim, and preparing it in thick sheets or blocks for shipment. Scrap rubber free of metallic parts without textiles, and not heavily loaded with inert compounds, is most valu- able, the value decreasing to the extent that these compounds are in the material. Reclaimed rubber contains much of the combined sulphur, carbon black, zinc oxide and other chemicals that were in the original products, about 50 percent of its weight, on the average, consisting of rubber .hydrocarbons. Products containing natural rub- ber and/or GR-S are reclaimable by the same process, and while butyl is usually seg- regated and separately reclaimed, small amounts of butyl will not materially affect the reclaim. Butyl reclaim can be compounded only with new butyl, however. Reclaim is regularly used in tires in the bead construction, and for competi- tive and economic reasons at times is used in the production of third and fourth line low-priced passenger tires, and low grade camelback. The advent of synthetic rubber has not, apparently, much affected the percentage use of reclaim in transpor- tation rubber goods as yet. In the field of hontransportation products, however, reclaim has definitely lost ground to the chemical rubbers and plastics. In rubber heels, flooring, mats and matting, insulated wire covering, and hoses of various kinds, where reclaim found a large use before World War II, its consumption has declined seriously in postwar years. In 1939, the ratio of reclaim to new rubber used in nontransport goods was 65.2 percent, in 1950 it was but 36.5 percent, and as already stated the consumption of reclaim in 1950 was temporarily rising because of high prices and re- striction of consumption of natural rubber. A large use of reclaim continues in the manufacture of hard rubber containers for batteries. The types of reclaim regularly quoted in current trade periodicals, are shown in table I, C(l) and the quotations (September 1951) indicate their relative values. Table I, C( I). —TYPES OF RECLAIM, SEPTEMBER 1951 Cents per pound Premium grade of specially selected whole tire reclaim (sp.gr. under 1.20).. First-line whole tire reclaim (sp.gr. under 1.20)..... Second- 1 ine whole tire reclaim..; Third-line whole tire reclaim Fourth-line whole tire reclaim Black carcass-type reclaim No. I grade light-colored carcass reclaim (sp.gr. 1.25 ana under) No. I selected peel reclaim ., Peel reclaim Butyl tube reclaim Special -pur pose natural rubber black tube reclaim. Natural rubber black tube reclaim... Red tube reel a im Gray tube reclaim 10.50 10.00 9.50 9.25 8.75 14.25 20.75 11.75 10.50 14.50 21.00 20.00 24.25 24.25 1-5 II Competitive Materials II Competitive Materials Rubber was competitive with leather in several of its earliest applications in the United States. The chief rubber product from 1830 to 1860 was waterproof rubber footwear, and today rubber heels and soles on footwear of various kinds have usurped a market once supplied by leather. Transmission belting, and fire hose (originally of leather) are other products where rubber has superseded leather. During the past thirty years, rubber has made increasing inroads in cushioning applications. At first, simple chair-seat cushions of chemically blown sponge rub- ber found a wide vogue. Later, efforts to produce a bulk product suitable for wide use in upholstery were crowned with success through the development of latex patents leading to foam rubber. In the field of pillows and mattresses, vehicle seat cush- ioning and furniture springs, and general furniture upholstery, rubber cushioning has invaded fields formerly supplied by felt, horsehair, steel springs, and other materials. At varying price levels, however, these materials are still competitive. To a certain extent, rubber products invaded fields formerly supplied wholly by textiles. Examples of this include textile transmission and conveyor belting and such fine rubber goods as aprons, bibs, baby pants, raincoats, and shower curtains. During the last ten years, certain fields formerly supplied by rubber materials have felt increasing competition from non-rubber plastics. Even before that, pyroxylin coatings competed with rubber coatings on textile-base materials for vari- ous applications. Today many fine hard rubber specialties and novelties have been superseded by similar less expensive articles made from non-rubber plastics. Insu- lation on wiring for automobiles and electrical appliances, formerly rubber, is now often of plastics with better di-electric properties. Light raincoats, aprons, and bibs, and shower curtains are now more frequently made of plastics than of rubber. Plastic garden hose, recently introduced although relatively expensive, is finding increasing favor because of its lightness and durability. II — 1 Ill Production Processes and Possible Problems Ill Production Processes and Possible Problems A. NATURAL RUBBER The planting of rubber trees, tapping, and preparation of rubber suitable for international trade, can be accomplished with simple equipment. That is the reason that production by native smallholders in the Far East has expanded so rapidly during the last twenty- five years. A native with two acres of mature Hevea trees, tapping with family labor, needs only tapping knives, tapping cups (coconut gourds can be used), pails to collect the latex, a coagulating tank (which can be made of wood), an acid coagulant (usually purchased, but can be homemade), a hand mangle for sheeting and pressing out excess water, and some bamboo poles on which to hang the wet sheets for air- drying. Smoked sheet can be prepared with a small smokehouse and wood fuel. He often transports his output to market on a bicycle. In Indonesia, wet sheet is sometimes rolled thin with a round bottle on a flat board, dispensing with the mangle. Native rubber produced by crude methods and lacking cleanliness is cleaned and dried in remilling plants in the Far East before shipment to consuming markets. These plants require imported power equipment, sheeting machines, and baling presses. Lack of remilling facilities has retarded the movement of native rubber in interna- tional trade at various times. During August- September 1951, Indonesian regulations, intended to force increased local remilling, interfered with shipments of wet slabs to Malaya where most of the milling had been done since World War II. For estate operations, aside from the labor requirements, the processes involve equipment and machinery on a scale in proportion to the size of the estate. This may involve bulldozers for clearing land for replanting, motor tank vehicles for transport of latex from collection points to the estate factory, power equipment to operate the^factory, huge coagulating tanks and batteries of sheeting machines to prepare the rubber in dry form, or tanks for storage, and centrifuging or creaming equipment for concentration of latex, baling equipment, and trucks or pipe lines for transport of the dry rubber or latex to rail or shipping points. Imported acids, vehicles, and machinery are necessary to the estate operations, but except for power equipment and transport much improvisation is possible in an emergency. Overseas transport is of course a point of vulnerability in case of war with an enemy strong in air, naval, and submarine power. B. SYNTHETIC RUBBER The plants established by our Government for the manufacture of GR-S, Butyl, and Neoprene during World War II are individually huge. The plants which produce Butadiene and Styrene, the feedstocks for GR-S, are also large. Butyl is produced in but two plants, Neoprene almost wholly in one. Fires and explosions which have occurred, in the Monsanto styrene plant in Texas, and at the Neoprene factories, sufficiently indicate the vulnerability of the synthetic rubber industry to bombing attacks or sabotage in time of war. From this viewpoint, the five styrene plants could be considered the points of key vulnerability for the entire GR-S production capacity. Strategic dispersal of plants, in more numerous small units, should be considered in connection with construction of any new facilities for either of these synthetics and the chief feedstocks. GR-S is a copolymer of Butadiene and Styrene; initially in the ratio of roughly three to one. In 1949, the bound styrene content averaged about 23 percent. Since then, progress has been made in the production of GR-S with a lower bound styrene content and in the fourth quarter of 1951 approximately three- fourths of the output was of the 20 percent bound styrene type. Experiments with a lower bound styrene content are under way. Styrene is mostly produced in facilities originally constructed by the Govern- ment to provide this material for use in the manufacture of GR-S. After the war, the plants with one exception were purchased by private firms, the Government re- taining certain priority rights on styrene production. As the use of GR-S was III— 1 reduced from 1947 to 1949, and this market for styrene dwindled, the producers found a growing demand for styrene in plastics, resins and paints. With the expansion in production of GR-S in 1950-51, demand for styrene increased. As production capacity was approached, the Government supplies of styrene from the Government-owned plant plus quantities for which rights were retained in the disposal of other plants be- came less than the GR-S requirements. The deficit has been supplied voluntarily by the private producers. This unavoidably lessened the quantity of styrene available to the plastics industry and other private consumers, who have complained against the restriction of their supplies. Meanwhile, substantial expansion of the styrene production is under way. Styrene has been derived from benzene (benzol) produced cheifly as a by-product of the production of coke for the manufacture of steel. The supply at a high rate, therefore, has been dependent on a high rate of steel production and coking opera- tions. The benzene production from this source is in the order of 160 million gal- lons a year. In 1951, to secure needed supplies, we imported about 60 million gal- lons from England, | France and Germany. Recently, the production of synthetic ben- zene from petroleum, but at a much higher price, is accounting for an increasing output. The scheduled annual rate from petroleum is 25 million gallons at the start and 90 million gallons at the end of 1952, the expansion being designed to assure dependable sources of supply. There are limited competitive seasonal demands for benzene in the production of benzene-derived chemicals such as dichlorobenzene moth crystals and other insecticides, and in detergents. Also, the aniline-based com- pounding materials employed in anti-oxidants and other organic chemicals widely used both in the production of synthetic rubber and in the manufacture of rubber prod- ucts, are derived from benzene, and have used about five percent of its production. Rutadiene facilities were designed for the production of 489,200 tons capacity annually although demonstrated capacity is closer to 600,000 long tons. Of the ten plants in the Government program, all but two are designed for production from petroleum derivatives, butylene and butane. The remaining two, with design capacity of 140,000 short tons, use alcohol as their feedstock. The cost of butadiene produced from petroleum fractions is much less than its cost produced from alcohol because alcohol is usually higher priced than butylene or butane. Except in times of high demand the alcohol plants are maintained in standby condition and production is concentrated in the more economical plants. During World War II, the GR-S and butadiene demand for petroleum fractions was in competition with the aviation gasoline demand for high-octane gas, involving the same fractions. In case of another general war, the production of GR-S might again need to depend heavily on butadiene from alcohol plants. Production of GR-S at a polymerization temperature of 122° Fahrenheit was the practice from the start of the program until 1948, when the development of cold GR-S was under experimental development. In 1949, production of GR-S polymerized at ap- proximately 41° Fahrenheit amounted to 67,512 long tons; in 1950 it was 134,963 long tons. Currently, the Reconstruction Finance Corporation is authorized (1) to increase the capacity for production of GR-S by 100,000 tons to 860,000 long tons annually by removal of bottlenecks in existing plants, and (2) to convert facilities to cold rubber production to the extent of 7 5 percent of the total output. GR-S statistics are recorded in terms of so-called "rubber hydrocarbon (RHC) content." For several years, master-batch GR-S with inter-mixed carbon black has been a regular item of production. In 1951, the production of oil-extended GR-S has received increasing attention. It has been found that the addition of low-priced oil in processing GR-S will increase the bulk of the resulting product without re- ducing its utility for a wide range of usage. By this process, adding 20 parts of oil to every 80 parts of RHC, a 25 percent increase in the volume of production is attained, at a lower average price per gross pound. This form of GR-S is also pro- duced with intermixed carbon black. The gross weight of black GR-S and oil-extended GR-S needs to be distinguished from the RHC or net weight, as presently recorded in NPA statistics of production and consumption. In June 1951, the net weight of pro- duction of these types was 2, 265 long tons, and output is expected to increase. Considered from the long-term viewpoint, the fact that petroleum resources are not inexhaustible, while agriculture can be depended upon indefinitely to supply material for the production of alcohol, indicates that agriculture may become impor- tant in determining the sources of butadiene. Ill— 2 The outlook for continued increase in the world demand and the United States demand for new rubber, which is already beyond the world capacity for production of natural rubber, makes future growth of the production of chemical rubbers a virtual certainty, not only in the United States but in other important consuming countries. It can be assumed that the production will be based on the lowest-priced materials obtainable, and it is probable that in terms of gold values the cost of production per pound will gradually decline from the level of late 1951. To predict what may develop in the way of international competition in these materials would be ex- tremely difficult, but presently, exchange difficulties would hamper foreign coun- tries in making heavy purchases from the United States on a commercial basis. C. RECLAIMED RUBBER The collection and distribution of scrap rubber, particularly discarded tires and inner tubes, is the foundation of the rubber reclaiming industry. The following list of types of scrap rubber, regularly quoted in a leading trade journal, are in- dicative of the forms in which this material is purchased by reclaimers. Table III C( I).— TYPES OF SCRAP RUBBER Mixed tires Mixed bead less tires Light colored carcass Black carcass No. I peel ings No. 2 peel ings No. 3 peel ings Buffings Truck and bus s. a.g. (sorted and graded tire parts) Passenger s. a. g. I Mixed s. a. g. Light colored tubes Natural rubber red tubes Natural rubber black tubes Mixed natural rubber tubes Butyl rubber tubes GR-S rubber tubes Mixed synthetic tubes The collection and sorting of scrap rubber is mainly in the hands of waste material dealers. Several huge firms specialize in the business. Tire manufac- turers who operate captive reclaiming plants also collect large quantities of tires and tubes through their dealers and company-owned stores. The normal demand for scrap rubber is much less than the quantity that could be obtained if all worn-out rubber products were collected. Consequently, collections are usually limited to areas where motor vehicle registrations are heavily concen- trated; these are the most economical collection areas. A worth-while index of the annual availability of scrap rubber by state areas could be constructed from statis- tics of motor vehicle registrations, and stated in terms of concentration per square mile or per 1,000 population, as an aid to collections in the more remote areas in any dire emergency. In June 1942, the President proclaimed a scrap rubber collection drive to pro- vide material for the greatly increased supply of reclaim needed for use in the war period before synthetic rubber production got under way. For purposes of this cam- paign, which had the whole-hearted cooperation of oil and rubber companies and their distributing agents and facilities throughout the nation, the Rubber Reserve Company III— 3 became the sole buyer and distributor of scrap rubber, summarize their activities as follows: Their subsequent reports Short tons Long tons 1,109,857 927,683 182,174 990,943 828,288 162,655 Sales On hand 1/27/45 In 1942-43, reclaimed rubber played an important part in providing material for the manufacture of required rubber products. Between 1943 and 1946 the use of re- claim declined but nevertheless remained fairly high. Further declines were evident through 1949. Despite increases in use in 1950 and the first half of 1951, private collections have provided all needed supplies of scrap rubber; with supplies of GR-S less restricted since mid- 1951, the percentage use of reclaim declined sharply in the third quarter of the year. The production capacity of the United States rubber reclaiming industry, demon- strated by actual production during the first six months of 1951, slightly exceeds 400,000 long tons annually. The previous production peaks were 304,000 tons in 1943, and 313,000 tons in 1950. Under normal circumstances, it will probably be several years before demand will again exceed current capacity; in case of general war, and particularly if synthetic rubber production was curtailed by sabotage or other developments, demand for reclaim might necessitate further expansion of facil- ities. The reclaiming processes, whether simple regrinding of clean material free of fabric, or the preparation of the product by the full alkali process, does not in- volve any serious problems other than equipment and power. The firms engaged in this business are individually large, in most cases, and for a new firm to enter in- to the business on a worth-while scale would involve a large financial outlay. A chart, showing the flow of materials in the production of reclaim by the digester process, appears in III, C(2), p. 5. Ill— 4 Table III, C(2) FLOW DIAGRAM OF DIGESTER RECLAIMING PROCESS (^ PREPARATION ^) Sifter Incoming Tires Sorted Scrap Debeader Vacuum Fines c D . r , um Settling Tank^^ Filter / Washer^ Scrap Metal C DIGESTION*^ Ji* Digester Reclaim!* Oil. Water Caustic totch ScA]e Soda ( milling" ^) Fi 1 lers^Xf Softeners Finishing Refiner Wind-up Druni Reclaimed Rubber Prel iminary Blending Mill Refiner 247921 0—53 2 III — 5 IV Raw Material Sources IV Raw Material Sources A. NATURAL RUBBER Table IV, A(l) indicates the approximate capacity of different countries for production of natural rubber by the estates for shipment as concentrated latex or as dry rubber, and by the natives or smallholders. The "capacity" as estimated here is intended to represent what could be produced at stimulating but not fantas- tically high prices in 1952 or 1953, if there were sufficient labor available to tap all mature trees in each area, and if there were no internal political or ter- rorist activities retarding the production. It is therefore an estimate of poten- tial maximum production attainable under favorable conditions, not an estimate of probable output, since conditions pricewise, laborwise, and politically will cer- tainly be less than ideal. The estimate for latex assumes at least an equivalent demand for natural rubber in that form. Table IV, A( I). —NATURAL RUBBER, ESTIMATED POTENTIAL ANNUAL PRODUCTION CAPACITY, 1952-53 [in I ,000 long tons] Area Malaya Indonesia Ceylon Thai land Indochina Sarawak British North Borneo... India Burma Other Asia and Oceania. Tropical America Li ber ia Other Africa Total Estates Latex 65 15 2 0.2 0.2 0.3 0.3 17 105 Dry 820 Natives 310 315 285 650 70 33 2 110 70 5 5 55 15 10 10 6 8 5 5 1 (wild) 30 15 1 2<+ 5 1,225 Total 690 950 105 112 80 60 25.2 16.2 13 5.3 31.3 33 29 2,150 These statistics of primary potential sources would be of interest if a situ- ation arose in which some areas were not accessible. Much of the rubber produced in Indonesia, Sarawak, North Borneo, and Burma is moved to Malaya before shipment to consuming countries. The statistics of rubber exports from Malaya include both domestically-produced and imported rubber. The general tendency, however, is toward direct shipments from producing to consuming markets; Thai rubber, which formerly reached world markets through Malaya, is now mostly shipped direct. The import statistics of most countries report rubber arriv- als "by countries whence imported" rather than "by countries of origin, " the latter being impossible to ascertain accurately in the case of imported rubber that has been remilled and packed in Malaya. The relative competitive strength of the different countries is a difficult matter to estimate, under current conditions. Before World War II, it was clear that the average yield per acre was low in Ceylon, India and Burma, resulting in relatively high costs in those areas; that is still the situation. In general, na- tives are lower-cost producers than estates, but their product sells at a discount below first quality estate grades of rubber, and if there should be a surplus of natural rubber, the lower grades would be most affected pricewise. Probably the efficient, high-yield estates are as strong, competitively, as the small native IV— 1 producers, considering prospective relative demand and supply for the types of rub- ber which they produce. B. SYNTHETIC RUBBERS In the United States, the Government facilities for production of GR-S origi- nally had a design capacity of 705,000 long tons annually. One Louisville plant with a design capacity of 60,000 long tons was sold after the war. Another 30,000 ton plant was cannibalized. The remaining plants, with a design capacity of 615,000 long tons, were in early 1951 rated capable of actually producing 760,000 tons annu- ally of the types of GR-S then being produced. Expansion of this capacity to 860,000 tons annually has been authorized, and the Reconstruction Finance Corpora- tion is under instructions to increase capacity to this rate as rapidly as possible. Instructions also provide for the refrigeration of facilities sufficient to produce 75 percent of the total in the form of cold rubber. The peak production of GR-S in the form of latex was 30,450 tons in the twelve months ended June 1951. The produc- tion of Oil-extended rubber is presently averaging about 2,000 tons monthly (RHC). Possibilities of speeding up the GR-S reaction time are constantly being studied; if it should prove feasible to multiply the output in a given period, there might result large changes in factory equipment and design, since the drying and handling equipment would have to be increased before the process could be adopted. The United States facilities for the production of Butyl have a design capacity for 68,000 tons annually. These plants produced 74,105 tons in 1951 and actual capacity is approximately 90,000 tons. The Reconstruction Finance Corporation is drawing plans for construction of new facilities with annual capacity of 30,000 to 50,000 tons, but actual construction would require Congressional action and appro- priations. In the annual report of the Reconstruction Finance Corporation for fiscal 1951, issued in December, the Government-owned plants in the synthetic rubber program are listed with names of operators and capacity data. Table IV, B(l) lists the Butadiene and Styrene plants, IV, B(2) lists the Butyl plants, and IV, B(3) lists the GR-S copolymer plants as reported in this latest official tabulation. Table IV, B( I).— OPERATORS OF GOVERNMENT-OWNED BUTADIENE AND STYRENE FACILITIES, AS OF JUNE 30, 1951 Operator Plant location Type of plant Approx. prod, capacity, tons/yr.* Lake Charles, La. .. Baton Rouge, La. . .. Port Neches, Tex... Torrance, Calif.... Torrance, Calif.... Butadiene from Butylenes.. Butadiene from Butylenes.. Butadiene from Butylenes.. Butadiene from Butylenes.. Butadiene from Butylenes.. Butadiene from Alcohol.... Butadiene from Alcohol.... 62,000 22,000 45,000 168,000 78,000 Standard Oil Co. of Calif. 4 Shell 60,000 45.000 Carbide & Carbon Chemicals Div. 70,000 105,000 57,000 The Dow Chemical Company "'Butadiene and styrene, short tons/year. Table IV, B(2).— OPERATORS OF GOVERNMENT-OWNED BUTYL RUBBER FACILITIES, AS OF JUNE 30, 1951 Operator Plant location Type of plant Approx. prod, capacity, tons/yr.* 40,000 40,000 * Butyl Rubber, long tons/year. IV— 2 Table IV, B( 3).— OPERATORS OF GOVERNMENT-OWNED SYNTHETIC RUBBER COPOLYMER FACILITIES AND OTHER COMPANY PARTICIPANTS, AS OF JUNE 30, 1951 Operator Plant location Approx. prod. cap. l.t./yr. Other participating companies Percent of partici- pation Firestone Tire & Rubber Co. B. F. Goodrich Chemical Co. Goodyear Synthet- ic Rubber Corp. United States Rubber Co. General Tire & Rubber Co. Phi 11 ips Chemical Co. Midland Rubber Corp. '"Copolymer Corp. . : Kentucky Syn- thetic Rubber Corp. Total. Lake Charles, La. Akron, Ohio Port Neches, Tex. Institute, W. Va. Houston, Texas... Akron, Ohio Port Neches, Tex. Naugatuck, Conn. . Baytown, Texas... Borger, Texas... Torrance, Calif. Baton Rouge, La. Louisville, Ky. 86,000 25,000 78,000 113,000 87,000 23,000 76,000 25,000 37,000 54,000 76,000 43,000 37,000 760,000 None Carlisle Corp., Carlisle, Pa None Denman Rubber Co., Warren, Ohio None General Latex & Chemical Corp., Cambridge, Mass. Mohawk Rubber Co., Akron, Ohio None... Cooper Tire & Rubber Co., Findlay, Ohio McCreary Tire & Rubber Co., Indiana, Pa None Pacific Rubber Co., Oakland, Calif Armstrong Rubber Co., West Haven, Conn Armstrong Rubber Mfg. Co., Des Moines, Iowa Dayton Rubber Co. , Dayton, Oh i o Gates Rubber Co. , Denver, Colorado Lee Rubber & Tire, Conshohocken, Pa Mansfield Tire & Rubber, Mansfield, Ohio Sears, Roebuck 4 Co. , (incl. Armstrong T4R, Natchez, Miss, in which Sears, Roebuck & Co. owns 50/J of the voting stock). Sieberl ing Rubber Co. , Akron, Ohio American Hard Rubber Co., New York, N. Y Boston Woven Hose & Rubber Co., Boston, Mass.... Brown Rubber Co., Inc., Lafayette, Ind Hewitt-Robbins, Inc., New York, N. Y Goodall Rubber Prod. Co., Trenton, N. J Sponge Rubber Prod. Co., Shelton, Conn She Her Mfg. Corp., Portland, Ind Simplex Wire & Cable Co., Cambridge, Mass Thiokol Corp., Trenton,- N. J Raybestos-Manhattan Inc., Passaic, N. J 10 10 35 10 10 5 35 12.5 12.5 12.5 12.5 12.5 12.5 12.5 12.3 10 10 10 10 10 10 10 10 10 10 '"Copolymer Corp. and Kentucky Synthetic Rubber Corp. by the companies listed as equal stockholders. are each separate corporations which are wholly owned Neoprene facilities privately owned during the war had a production peak of 10,623 tons in 1946. The Government-constructed facilities at Louisville had a design capacity of 60,000 tons, but after the war, one 15,000 ton unit was cannibal- ized. This plant was sold to du Pont in January 1949, and that company since then has been the sole producer. In 1951 they rehabilitated the extra 15,000 ton unit and production capacity is now about 70,000 tons annually. The peak production of Neoprene in the form of latex was 13,595 tons in 1946. N-Type synthetic rubbers are all privately produced, by the four leading manu- facturing companies— Firestone, Goodrich, Goodyear, and IT. S. Rubber. Production in June-August 1951 attained its peak rate of 17 ,412 tons a year; the capacity may be 20,000 annually. Production in the form of latex averaged 237 tons monthly during the first nine months of 1951. IV— 3 In Canada, the peak production of synthetic rubbers was in 1950—41,893 long tons of S-Type rubbers, 12,921 tons Butyl, and 3,646 tons of other types — a total of 58,440 long tons. Germany had a peak production of 115,754 long tons of synthetic rubbers in 1943 After the war, the plants in the western zone were eventually dismantled. In 1951, steps have been taken to reestablish a minor production, and output, of Buna S at a rate of 500 tons a month starting November is planned at the Huls plant in Westpha- lia. Bayer-Werke at Leverkusen can start manufacturing Perbunan (N-Type) at a rate of 120 tons a month as soon as it can obtain the necessary butadiene, but because of dismantling will not be able to produce Buna S rubber for at least two years. A re- construction of the Huls plant that would permit production at a rate of 1,800 tons monthly two years hence is also possible. An output of 10,000 tons annually for all types is the maximum to be expected in Germany in 1952 and 1953, recent reports in- dicate. Estimates of Russian synthetic rubber production in 1948-49 were about 200,000 tons, and for 1950-51 about 250,000 tons. There are no accurate authoritative sta- tistics for either the Russian production or consumption of rubber. If growth in world rubber consumption continues, and if natural rubber produc- tion should be unable to meet demand with ample supplies at competitive prices as the years pass, it would be expected that additions to the production capacity for synthetic rubber might be considered in various countries, particularly since new supplies could thus be obtained within two or three years, compared with the seven to ten years needed to plant and grow a natural rubber plantation to maturity. Any sharply rising demand for rubber could not well be satisfied by starting new planta- tions. It appears probable that the costs of producing synthetic rubber will have a tendency to fall, as a result of new developments in materials and processes in this young industry. The cost of producing different types varies substantially; this will doubtless continue. Varying costs and supply-demand factors for GR-S subtypes, particularly in case of private ownership of producing facilities, would probably come to be reflected in different selling prices for the sub-types. The oil- extended rubber opens wide price possibilities. Since alcohol-based butadiene is relatively expensive, privately-owned plants would presumably be based on the less costly butadiene from petroleum. Under private ownership, taxes and profits would have to come from the sales dollar, and would tend to raise the selling prices to that extent. It appears probable that synthetic rubber will in future be generally used not only in applications where it is definitely superior, but also wherever it can be used interchangeably with natural rubber unless natural rubber sells at an equal or lower price. C. RECLAIMED RUBBER The production of reclaim is a concomitant of the rubber-manufacturing industry in nearly every consuming country of importance. Traditionally, use of reclaim has been discouraged in the United Kingdom and many of its possessions because of the dominant Empire interest in natural rubber production. In the United States and elsewhere, from 1900 to the time when synthetic rubber production assumed impor- tance, reclaim represented the first line of strategic defense against scarcity of and economic defense against high prices for natural rubber. In the countries which now produce synthetic rubbers, these materials have superseded reclaim strategi- cally, and they have made inroads on the economic position formerly occupied by re- claim. Although the percentage use of reclaim has shown a declining tendency in the United States since the advent of large-scale production of synthetic rubbers, the total new rubber consumption has increased so much that the tonnage use of reclaim has been well maintained, and since reclaimers have not suffered serious reduction in tonnage demand the economic trend has not occasioned much comment. The unusual demand for reclaim in the last half of 1950 and the first half of 1951 pushed pro- duction to a new high record, while new rubber was in scanty supply. With GR-S in more ample supply, the demand for reclaim subsided during the third quarter of 1951, and the reclaiming industry is retrenching. It appears doubtful whether they will IV— 4 again be called upon to produce reclaim at a rate of 400,000 tons a year, as they were in the first half of 1951, for many years to come, provided supplies of general purpose synthetic rubber continue easy to obtain. Labor costs, and transportation costs, involved in the collection, sorting and distribution of scrap rubber, have increased considerably since 1946. A large plant investment is required for production of reclaim, which is dependent for much of its market on its ability to supply an adequate substitute for new rubber at a low price. Reduced demand for reclaim will no doubt be followed by lower prices for scrap rubber in due course, but the possibilities of reducing selling prices of re- claim are limited except for special items, such as butyl tube reclaim. IV— 5 Raw Material Production V Raw Material Production A. NATURAL RUBBER The production of natural rubber by chief countries, with sub-totals by conti- nents, is shown in table V, A(l). The statistics cover rubber in dry forms and in the form of latex. Production is concentrated mostly in Southeast Asia and nearby islands, where the plantation rubber industry became the chief source of the world's supply in 1912. The rubber produced in tropical America is from trees growing wild, with negligible exceptions. Since the start of plantation production in Liberia by Firestone, production in Africa has shown a steady increase which may portend a significant shift of the industry in that direction in the future. The production of rubber in the Far East was influenced by international regu- lation of production from 1935 to 1941, by World War II through 1946, and by dis- turbed political and economic conditions since 1946- In the regulation period, the production in what is now Indonesia was more severely restricted than elsewhere be- cause the quota for the native producers there was much lower than productive ca- pacity. During the war, Ceylon and India continued in Allied control; Indochina was the only country under Japanese control which maintained production at a high rate through 1944; production in Africa and tropical America was stimulated by special programs. Since the war, Indochina has not in any year produced much more than half its potential output, because of guerilla warfare, and Malayan production since 1948 has been affected by guerilla activities which continue unabated. \ In Indonesia, political, labor, and tax conditions have prevented the large estates from attaining output equal to 60 percent of their capacity, and the production by Indonesian natives was far below capacity until 1950 and 1951 when their output was stimulated by the extremely high prices for rubber. Production in 1950 was near the capacity of areas other than Indonesia and Indochina, but because of the below- capacity output there and in the wild rubber regions, world production was only 86 percent of the potential world capacity as previously estimated. In this connection, much of the planted rubber in Ceylon and Malaya, and some elsewhere, consists of old low-yield trees which are really already obsolescent. The present potential capacity in the Far East probably will not be maintained many years in the absence of new planting or replanting, and although current price con- ditions would normally stimulate expansion, the disturbed social and economic con- ditions there are discouraging if not prohibitive factors, particularly for large estates. Three American firms — Firestone with plantations in Liberia; Goodyear in Sumatra, the Philippine Islands and Costa Rica; and U. S. Rubber Company in Malaya and Sumatra — account for around 5 percent of the total world production of natural rubber. While small shipments of rubber latex were made in very early years of rubber manufacturing, a volume trade first developed after World War I. The growing de- mand was supplied almost exclusively from Malaya and Indonesia until the middle 1930' s. Table V, A(2) shows the exports from the producing countries since 1935, in terms of long tons dry rubber content. Malaya is the chief source, and Liberia has been the next largest source since the war. Indonesian facilities began to be re- habilitated in 1950, and in 1951 they would have rivaled Liberia in volume of ship- ments but for the sharp decline in United States demand for natural latex which led to general curtailment of shipments to the American market. In 1950, about 5 per- cent of the natural rubber produced was shipped as latex. In this production field, the plantations operated by Firestone, Goodyear, and U. S. Rubber are important factors. V-l Table V, A (I ) .—ESTIMATED WORLD PRODUCTION OF NATURAL RUBBER, 1935-50 (1,000 LONG TONS) 1935 1936 1937 1938 1939 1910 1941 Malaya Indones ia , Ceylon Thai land Indochina Bri ti sh Borneo Ind ia Burma Other Asia & Oceania, Total Brazi 1 , Other America , Total , Liberia Belgian Congo . Nigeria Other British Africa, French Afr ica Other Africa Tota 1 Grand total... Malaya Indones ia Ceylon Tha i land Indoch ina Bri tish Borneo Ind ia Burma Other Asia & Oceania Total Brazil Other America Total Liberia Belgian Congo Nigeria Other British Africa French Africa Other Africa Total Grand total. . . 376.8 282.9 5"+ 28 28 29 12 9 I 363.7 309.6 49.7 34.6 40.8 30.5 13.6 13.2 1.6 501.1 450.7 72.5 35.6 48.0 40.0 14.4 10.2 1.8 359.5 317.2 50. 41 60, 28, 12.5 8.9 1.9 360.1 378.2 60.0 41 .8 68.0 37.1 14.0 6.6 2.1 547.2 543.2 90.0 43.9 64.0 54.6 16.7 9.8 3.9 600.0 650.0 99.5 45.5 74.9 57.0 16.3 8.8 2.3 823.9 12.4 1.6 857.3 15.5 2.8 1,174.3 15.1 6.1 879.8 13.5 5.7 967.9 14.1 6.1 1,373.3 18.6 7.4 1,554.3 16.9 8.9 14.0 .8 .8 2.1 .7 1.7 .1 18.3 1.6 .8 2.2 I.I 2.5 .2 21.2 2.3 1.0 2.6 I .2 4.0 .5 19.2 2-9 I.I 3.1 I .3 3.4 .1 20.2 5.4 I.I 2.8 1.5 3.6 .2 26.0 7.2 1.2 2.9 1.6 2.9 .3 25.8 8.4 1.3 2.1 1.3 3.5 .4 6.2 844.1 8.4 884.0 II .6 1,207.1 I 1.9 910.9 14.6 I ,002.7 16.1 1,415.4 17.0 1,597.1 1943 1944 1945 1946 1947 1948 1949 75.0 100.0 105.5 4.8 70.4 5.0 16.6 25.0 50.0 98.5 8.6 10.0 97.5 60.4 17.3 .9 1.9 12.0 16.1 .6 2.0 403.7 175.0 94.0 24.2 20.0 14.3 15.8 5.6 1.6 646.4 278.0 89.0 52.6 38.1 53.7 16.4 8.6 2.7 698.2 432.3 95.0 95.9 43.9 61 .8 15.4 9.1 3.1 671.5 431.8 89.5 94.2 43.0 60.7 15.6 8.5 2.2 378.2 23.1 18.8 253.1 29.4 20.5 146.8 24.1 23.0 754.2 23.7 16.0 I ,185.5 25.9 9.0 1,454.7 20.2 9.0 1,417.0 21.3 6.0 41 .9 14.4 7.8 7.4 5.1 8.0 2.2 49.9 18.1 II. I 9.4 4.3 10.4 1.6 47.1 19.9 7.8 9.9 4.9 9.4 1.8 39.7 20.7 4.5 11.5 2.9 5.6 1.7 34.9 22.8 4.0 7.4 .7 3.5 .1 29.2 24.7 4.9 8.0 .7 3.2 .1 27.3 26.6 6.8 6.8 .5 2.4 (*) 44.9 465.0 54.9 357.9 53.7 247.6 46.9 840.8 38.5 1,258.9 41.6 1,525.5 43.1 1,487.4 Less than 50 tons. Source: Rubber Division, NPA. V-2 Table V, A(2).— NET EXPORTS OF NATURAL RUBBER LATEX FROM PRODUCING COUNTRIES 1935-1950 [in long tons] Year Malaya Indones ia Ceylon Indochina British North Borneo Liberia Others Total 1935. 1936. 1937. 1938. 1939. 1940. 1941. 1942. 1943. 1944. 1945. 1946. 1947. 1948. 1949. 1950. 1 3 , 1 50 16,936 19,408 14,931 22,497 22,269 19,202 827 n.a. n.a. 142 5,341 26,595 39,956 45,731 73,218 7,543 10,684 13,651 6,181 17,615 17,559 20,000 n.a. 20 5 4 I 6 10 32 40 15 10 31 7 I 7 7 10 74 129 307 446 363 644 750 e 39 e 53 18 1,397 7,607 15 39 446 625 879 1,272 10 170 241 293 634 191 709 1,139 1,386 2,586 4,259 4,326 6,147 1,659 4,416 5,036 6,909 9,168 6,006 7,720 15,013 23 I 96 224 163 n.a. 20,898 28,494 34,516 22,946 43,074 44,748 44,320 7,014 1,674 4,416 5,216 12,341 36,528 47,070 56,183 97,744 e Est imated. n.a. Not available. Source: Rubber Statistical Bulletin, Secretariat of the International Rubber Study Group. While natural rubber is not produced in the United States at present, the sub- ject has not been ignored. Before 1900, abortive efforts were made to launch Hevea plantations in Florida or Louisiana. The -guayule shrub has since 1905 been the sub- ject of private and governmental study and experiment, and the Intercontinental Rub- ber Company produced rubber from domestically planted shrub in the 1920' s. During World War II, over $33 millions was expended in connection with a domestic guayule production program, which was abandoned after fighting ceased, Thomas Edison devoted considerable study to guayule, goldenrod, cryptostegia, and other plants capable of producing rubber within the United States in 1926--28. Appropriations for the Bureau of Plant Industry Department of Agriculture, since the early 1920' s at least, have provided funds earmarked for the study of and experimentation with domestic and im- ported plants which in time of emergency, might be used to produce natural rubber in this country, or elsewhere in the Western hemisphere. A great deal of progress in yield improvement from guayule has been made. The development of synthetic rubber and the strategic stockpiling of natural rubber have not ended these endeavors, but the chance that in any emergency this country would undertake a domestic natural rubber production program on a scale capable of caring even for our minimum needs now seems remote. During the 1922-28 period of British Restriction of Rubber Production, designed to assure profitable operations for the rubber plantation industry in British Colo- nies, the United States Government made a survey of natural rubber production possi- bilities throughout the world, with a view to stimulating production in areas free of control, and particularly in Latin America as a factor in our hemispheric de- fense. As a by-product and aftermath of the high prices of rubber in 1925-27, Fire- stone engaged in the production in Mexico and Liberia, Goodyear in the Philippines, Panama, and Costa Rica, and the Ford Motor Company in Brazil. The efforts in Mexico, Panama, and Brazil have been abandoned by these companies. The start of World War II led our Government to enter into cooperative agreements with various tropical American Governments with a view to developing Hevea plantations with high- yield trees resistant to the destructive South American leaf disease, in an effort to stimulate rubber production in this hemisphere. Considerable success has been attained in the technical development of suitable trees, but thus far the plantation development consists only of experimental plots. V— 3 B. SYNTHETIC RUBBER In the United States, before the Pearl Harbor attack, production of synthetic rubber was entirely in private hands. In 1941, du Pont was producing Neoprene, a few leading rubber manufacturing companies were producing N-Type rubbers, a small quantity of high-styrene butadiene-styrene rubber was being turned out, and the Standard Oil Company of New Jersey was able to make Butyl in its pilot plant at Baton Rouge. The conquest of Southeast Asia by Japan leaving the Allies only Ceylon and India as sources of natural rubber in the Far East, forced the United States Gov- ernment to launch its huge synthetic rubber program to provide rubber materials which, with stockpiled natural rubber, would permit continuing production of essen- tial rubber products for the duration of the war. The first requisite was a large tonnage of general purpose synthetic capable of replacing natural rubber in a wide range of uses, and particularly in tires and camelback; for this, the butadiene-styrene copolymer (roughly, three parts of buta- diene to one part of styrene) was chosen, and plant construction included 15 copol- ymer factories with a design capacity of 705,000 long tons of GR-S. Neoprene, although much higher in cost, also had a prospective wide application, and the pro- gram provided additional facilities with a capacity of 60,000 long tons. The de- sign capacity of Butyl facilities was 68,000 long tons; at the time, this rubber's suitability for inner tubes had not been generally recognized. The technical knowledge of all American firms and individuals, and all patents of record wejre pooled in planning the processes and the design and construction of the factories. That the entire program was so highly successful is rightly rated as one of the outstanding industrial achievements of World War II. As a concomitant of the program, Canada undertook a program for the annual production of 50,000 long tons of chemical rubbers annually, three fourths of the styrene type, and one fourth Butyl. Table V, B(l), shows the production of synthetic rubbers in the United States and Canada, by types, from 1940 through 1950. Near capacity output for Neoprene was achieved in 1944 somewhat in advance of GR-S; Butyl output was retarded by extremely difficult problems of plant construction and operation of the processing of this little-known material, and full output was not attained until 1946, after the war ended. The actual production of GR-S, in 1945, exceeded the design capacity of the facilities. Table V, B( I ).— PRODUCTION OF SYNTHETIC RUBBER IN UNITED STATES AND CANADA [Long tons] Year UNITED STATES S-Type GR-S Private Butyl Neo- prene N-Type Total CANADA S-Type Butyl Other Total Grand total 1939. i mo. 1941 . 1942. 1943. 1944. 1945. 1946. 1947. 1948. 1949. 1950. 2,276 181,470 668,831 717,693 612,687 405,496 390,240 288,882 350,801 227 I ,445 789 1,437 1,711 721 2,273 3,640 6,284 7,447 23 1,373 18,890 47,426 73,114 62,820 52,603 52,237 55,832 1,738 2,469 5,692 8, 956 33,603 56,660 45,672 45,766 31 ,495 34,848 35,215 50,067 12 91 2,464 9,734 14,487 16,812 7,871 5,738 6,618 7,012 11,072 12,037 1,750 2,560 8,383 22,434 231,722 762,630 820,373 740,026 508,702 488,343 393,690 476, 1 84 2,522 32,062 36,638 38,770 35,314 32,242 37,333 41 ,873 2,767 9,079 12,211 7,079 7,952 7,047 12,921 261 2,262 3,646 2,522 34,829 45,717 50,981 42,393 40,455 46,642 58,440 1,750 2,560 8,383 22,434 234,244 797,459 866,090 791 ,007 551,095 528,798 440,332 534,624 Source: Rubber Division, NPA, and Secretariat of the International Rubber Study Group. V— 4 After the war, as imports of natural rubber from Southeast Asia were resumed, the demand for chemical rubbers and particularly GR-S declined year after year through 1949, and the production in the United States was reduced accordingly. .In Canada, however, by exporting output in excess of Canadian demand to the United States and elsewhere at a slight discount below the United States GR-S and Butyl prices, the production was well sustained and overhead expenses spread over a vol- ume of business that, in the aggregate, was profitable. The program for increased production of chemical rubbers in 1950 and 1951 has been discussed in a previous section. Production of GR-S in the third quarter of 1951 was at the annual rate of nearly 760,000 long tons; whether there will be need for production at the authorized rate of "860,000 tons as soon as possible" is un- certain. The United States production of synthetic latices is shown, for GR-S and Neoprene, in Table V, B(2). Neoprene latex was finding some applications before the United States entered World War II, and this use increased as natural latex consump- tion was restricted. Demand for GR-S latex likewise grew rapidly in 1944, 1945, and attained a peak in 1946. Then as natural latex became obtainable in increasing quantities, demand for and production of the synthetic latices declined until 1950. In 1950, the high prices for natural latex and the improved qualities of cold GR-S latex combined to stimulate increased use of the latter in foam latex products. There is also a production of N-Type latex, but statistics have first been compiled in 1951, showing production of 2,131 long tons in nine months. High-styrene S-Type latices are also privately produced, finding application in so-called rubber paint. The German production of chemical rubbers is shown in Table V, B(3). A small output was permitted by the Allies in the British Zone after the defeat of Germany until June 1948, when it was discontinued, and plants were dismantled. Renewed pro- duction was authorized and started in November 1951 • Data on the production in Eastern Germany under Russian jurisdiction since 1945 has not beem reported. Table V, B(2).— U. S. SYNTHETIC LATICES PRODUCTION, 1941-50 [Long tons] Year GR-S Neoprene Total Year GR-S Neoprene Total 1941 59 210 1,512 4,683 7,077 59 210 1,706 1 1 ,263 22,253 I 946 24,810 22,474 21,018 19,761 28,515 1 3 , 603 6,089 5,022 3,651 5,725 38,413 28,563 26 040 1942 1 914.7 1 943 194 6,580 15,176 1948 1944 1949 23,412 34,240 I 945 1950 Source: NPA, Rubber Division, compiled from reports by producers. Table V, B(3). —SYNTHETIC RUBBER PRODUCTION IN GERMANY*, 1937-49 [Long tons] Year Buna S Buna N Others** Tota'l Year Buna S Buna N Others** Total I 937 2,076 3,931 20,251 36,550 64,848 92,678 394 630 1,108 1 ,868 2,589 2,779 627 834 638 1,408 1,924 2,678 3,097 5,395 21,997 39,826 69,361 98 , 1 35 1943 1946 1948 108,822 95,953 14,945 7,835 3,388 3,598 3,122 1 3,334 2,549 612 394 115,754 101 ,624 1938 1939 1940 15,557 8,229 3,388 1941 1942 *British Zone only from 1945. **From 1937 to 1944 "N" types shown separately, while from 1945 onward the term "others" includes "N" types. Production Buna S in 1937-38 in one small plant was not available and Buna was estimated. The production data for 1944 for both rubbers mentioned were for the same plant and were not available after October 26, I 944. The production of synthetic rubber was discontinued in the summer of 1948 (see HIC0G Report 29, 1/11/50). Source: SHAEF Restricted Report and Rubber Statistical Bulletin. V-5 The amount of synthetic rubber produced in Russia is unknown. Russia began producing synthetic rubber some time before 1930. In the 1931-35 period, the Russian imports of natural rubber averaged 35,000 long tons a year, and in 1936-40 approximately 30,000 long tons a year. It is a reasonable probability that the pro- duction of synthetic rubbers averaged less than 50,000 long tons a year in 1930-35, and less than 100,000 long tons a year in 1936-40. During the war, as Russia was invaded, some plants were probably destroyed, some moved inland beyond the occupied area. In 1948-50, Russian imports of natural rubber averaged 96,000 long tons annu- ally; probably a substantial tonnage was stockpiled, but the consumption must have at least doubled over prewar years. Considering possible ratios of use of natural rubber with synthetics, and bearing in mind that facilities for synthetic production existed in Eastern Germany at the time of Russian occupation and that Russian satel- lite areas probably obtain some synthetics from Russia, a Russian area production around 200,000 tons of synthetics in 1949 might be guessed, and a production of 250,000 tons in 1951 appears probable. C. RECLAIMED RUBBER The production of, and demand for, reclaimed rubber in the United States has a tendency to increase with rising prices for new rubber, and to decline with falling prices. In Table V, C(l), this tendency is clearly indicated, the production being shown alongside the average declared value per pound of all imports of natural rub- ber (guayule, latex, and other), and with the average daily spot market price for No. 1 Ribbed Smoked Sheet. The all-time peak production was attained in the first half of 1951, at an annual rate of 400,000 long tons. The abnormality of this rate is evident in com- parison with the past record. Only in a serious emergency is the rate likely to be required for a full year, during the next several years. Table V, C( I ). — U. S. PRODUCTION OF RECLAIMED RUBBER; UNITED VALUE OF NATURAL RUBBER IMPORTS; MARKET PRICE OF NO. I R.S.S. , 1935-50 Year Reclaim production long tons Natural rubber imports value per lb. cents #1 R.S.S. market price cents Year Reclaim production long tons Natural rubber imports value per lb. cents m r.s.s. market price cents 1935 1936 1937 1938 1939 1940...... 1941 1942 119,900 1 42 ,000 185,000 122,400 186,000 209,000 274,000 285,100 11.4 14.9 18.5 14.1 16.0 17.4 18.2 18.9 12.4 16.4 19.4 14.6 17.6 20.1 22.4 22.5 1943 1945 1948........ 304,000 260,600 243,300 295,600 291,400 266,900 224,000 313,000 27.1 31.2 31.4 27.2 20.0 18.8 16.2 25.5 22.5 22.5 22.5 22.5 20.8 22.0 17.6 41.2 Source: Rubber Division, NPA, and Predecessor Agencies. Statistics for reclaimed rubber production are recorded for only a few coun- tries. Some production is carried on in every important rubber manufacturing coun- try. Russia probably has a capacity for producing around 40,000 long tons of re- claim annually; France probably has a capacity for producing 30,000 tons annually. Production in the leading foreign countries for which statistics are available are shown in Table V, C(2). The responsiveness of reclaim production abroad to higher natural rubber prices in 1950 and 1951 was marked; in the first half of 1951 the production in the United Kingdom was at an annual rate of 35,000 long tons, and in Germany 30,000 long tons. V-6. Table V, C (2 J.— PRODUCTION OF RECLAIMED RUBBER IN CERTAIN FOREIGN COUNTRIES [in long tons] Year United Kingdom Germany Austral ia Canada |gi|5 22,317 27,798 22,431 24,614 20,946 30,083 n.a. n.a. n.a. n.a. 24,147 24,500 5,819 6,410 5,973 5,305 5,899 8,248 3,307 igi+6 3,967 191+7 4,125 1 gi+8 4,323 1 914.9 3,475 1950 4,456 n.a. Not ava i lable. Source: Rubber Statistical Bulletin. V— 7 VI United States Imports, Exports, and Reexports VI United States Imports., Exports, and Reexports A. NATURAL RUBBER In the period between World War I and II, the capacity for natural rubber pro- duction was greater, broadly speaking, than the world demand for rubber. The actual production was restricted by the Stevenson Rubber Restriction Scheme effective in British possessions in the Far East from November 1, 1922, through October 31, 1928, and by the International Rubber Regulation Agreement effective thoughout the rubber-producing countries in the Far East from June 1, 1934 until their conquest by Japan in early 1942. Under the terms of the regulations, however, it was always possible to bid prices high enough to result in production in excess of demand, al- though sometimes unreasonably high prices occurred before the supply was forth- coming. By and large, therefore, this was a period of plentiful supply of natural rubber. In that period, there developed a philosophy that there always would be enough natural rubber to meet world needs; it was only necessary to pay high enough prices to bring out any amount normally required for United States imports. The United States imports were made in part (about 40 percent of the total) by manufacturers who imported direct from their plantations and purchasing offices in producing areas, and in part (about 60 percent of the total) by rubber importers and dealers who distributed to manufacturers the types and qualities desired by each. The dealers are organized in the Rubber Trade Association of New York. New York City is the principal port of entry for rubber, where all dealers maintain their head offices. The imports of rubber were entirely in the hands of private trade until 1939, when our Government through the Commodity Credit Corporation bartered 500,000 bales of cotton for 86,000 tons (advance estimate) of rubber, delivered during the next year, in a deal with the British Government. In late 1940, the Reconstruction Fi- nance Corporation was instructed to accumulate stocks of rubber for a strategic Government stockpile, and in 1941 the Commodity Credit stocks were merged with those of the Rubber Reserve Company of R.F.C. , which used American manufacturers as buying agents. Subsequently, for the duration of the war, the Government took jurisdiction over all imports of natural rubber, and the importing function was placed in the Rubber Development Corporation (originally in the R.F.C, later in Foreign Economic Administration) where it remained through March 31, 1947. Then private importation was again permitted, the Government continuing also to buy for the national strate- gic stockpile through the General Services Administration, mostly through private American importers and dealers. Since World War II, the world annual production of natural rubber has regularly been less than the world consumption of new rubber (natural and synthetic). Foreign nations, except Russia and Canada, do not produce synthetic rubber, and lack Ameri- can exchange with which to buy it from the United States, which in fact has seldom had supplies for export. Several countries are directly and deeply interested in the economic welfare of the natural rubber producing areas, through large invest- ments of their citizens. Consequently, foreign countries except Russia and Canada have used natural rubber almost exclusively in making rubber products. In addition several foreign governments have small strategic stockpiles of natural rubber. The circumstances compel foreign importers to fill their needs by competitive purchase of natural rubber. The effect is the same as if foreign countries had a priority of claim on the supplies of natural rubber. The United States imports of rubber since the war represent the residue of world production after foreign demand has been satisfied. The stockpiling purchases of natural rubber by the United States Government further reduce the quantities available to our domestic industry. The industry can obtain natural rubber only to the extent of the surplus of the world production over foreign purchases and United States Government stockpiling purchases, without put- ting undue strain on the market. Industry practice broadly has been to use natural rubber, from 1947 through early 1950, to the extent of this surplus and, in addition, VT— ] 247921 0—53 3 V X X 'to use as much synthetic rubber as was necessary to satisfy requirements. In 1950, however, the amount of synthetics produced did not suffice industry needs. The American industry was thus the residual buyer of natural rubber until the Government, again became the sole importer in December 1950, since when the General Services Administration has been in that position. Each time GSA has attemped to buy ag- gressively, the result has been chiefly to force a higher price for rubber, without reducing the purchases by foreign buyers who always can outbid them for the small amounts which each individually requires. Tables under section VI, A include: (1) a statement of our annual gross im- ports, reexports, and net imports of natural rubber from 1925 to 1950; (2) gross im- ports of natural rubber by chief sources from 1936 to 1950; (3) imports of natural latex by chief sources; (4) percentages of total imports by ports of entry for rep- resentative years since World War II; and (5) imports of natural rubber by types in 1948, 1949, and 1950 as reported by the Rubber Manufacturers Association and the Rubber Trade Association of New York. The United States, while still by far the leading market for natural rubber, now buys much less than half the world production even though our purchases include a huge tonnage for the strategic stockpile. Foreign countries in the aggregate use much more natural rubber than the United States, and their imports have been in- creasing annually. The influence of the United States on natural rubber producing regions might be expected to decline if our import percentage of the world produc- tion of natural rubber diminishes, as it probably will when our stockpiling ceases. We need to determine in advance what we will do if they appeal to us for aid. Table VI, A( I ). — U.S. GROSS IMPORTS, REEXPORTS AND NET IMPORTS OF NATURAL RUBBER, 1925-50 [Long tonsj Year Gross imports Reexports Net imports Year Gross imports Reexports Net imports 1925 400,423 417,643 431,246 439,731 565,087 487,628 501,788 414,668 418,902 463,018 467, 146 488,145 600,476 1 4, 827 17,671 27,775 32,159 36,485 30,205 25,609 20,937 20,576 23,856 11,391 12,582 7,948 385,596 399,972 403,471 407,572 528,602 457,423 476,179 393,731 398 , 326 439,162 455,755 475,563 592,528 1939 1942 1943 1946 1947 1948 1949 412,092 499,616 818,624 1,029,176 282,445 59,926 113,639 149,221 1 390 , 267 711,513 735,340 660,551 802,138 5,652 13,125 7,060 5,376 10,856 22,583 9,739 9,509 7,711 4,121 6,672 6,253 8,640 406,440 486,491 811,564 1,023,800 271,589 .37,343 103,900 139,712 382,556 707,392 728,668 654,298 793,498 1926 1927 1928 1929 1930 1931 1932 1933 1934 1935 1936 1 Includes 10,087 tons from Table 28— TP 181 to 1937, Japan. Bureau of Census 1938-50. VI-2 Table VI, A(2).— UNITED STATES IMPORTS OF NATURAL RUBBER (INCLUDING LATEX AND GUAYULE) FROM CHIEF SOURCES— 1 935-50 [l,000 long tons] Year Mai aya Indo- nesia Thai- land Cey- land Indo- china Other Asia & Ocean i a Liberia Other Africa Mex i co Brazil Other Tropical America All Other Total 1935. 1936. 1937. 1938. 1939. 1940. 1941. 1942. 1943. 1944. 1945. 1946. 1947. 1948. 1949. 1950. 345.7 339.8 384.8 244.6 273.2 421.1 552.1 93.1 (*) 7.7 202.8 571.0 452.7 311. 1 360.8 78.0 96.1 153.2 109.9 143.0 288.0 369.4 128.2 0.4 0.3 34.0 36.3 113.3 179.2 214.0 (*) (*) 1.0 0.9 7.5 11.8 30.5 98.2 106.1 26.2 27.0 29.9 24.9 34.8 55.0 61.0 34.1 19.7 58.8 62.3 17.9 40.5 54.6 41.8 63.4 7.6 13.2 16.3 20.2 26.0 28.8 21.9 67.2 9.7 5.3 1.9 20.8 1.3 1.3 4.2 2.8 4.0 6.3 2.4 0.2 1.5 5.1 12.7 2.2 1.4 1.0 1.3 0.8 1.6 2.3 2.9 5.3 6.9 7.3 9.9 13.6 15.3 20.3 22. 1 20.5 24.9 25.7 28.9 0.1 0.2 0.1 (*) 0.2 0.4 3.3 2.5 5.2 16.2 2.1 1.9 2.2 1.4 4.7 0.5 1.2 2.8 2.5 2.2 3.6 4.9 5.5 7.7 6.7 10.0 5.3 2.9 0.3 0.7 5.1 4.0 5.7 3.3 4.7 5.6 4.6 5.7 12.6 18.7 19.0 11.9 9.9 (*) 0.1 0.3 0.8 1.0 0.8 0.7 1.9 1.4 3.2 5.9 7.4 8.3 6.8 4.8 0.2 0.6 0.5 467.1 438.1 600.5 412.1 499.6 818.6 ,029.2 282.4 59.9 113.6 149.2 390.3 711.5 735.3 660.6 802.1 * Less than .05. Table VI, A(3).— U. S. IMPORTS OF NATURAL LATEX BY SOURCES, 1936-50 [Long tons] Year Mai aya Ceylon Indonesia L i be r i a Indo-china Other Total 1936 9,421 9,183 4,976 11,508 12,825 12,775 1,850 II 4 20 85 39 9,347 12,807 5,551 13,510 16,923 18,227 2,194 709 1,137 1,317 2,318 4,039 3,719 5,261 1,879 3,091 4,773 7,273 7,672 7,110 6,800 14,244 371 38 15 18 2 75 86 19,852 1937 23, 185 1938 1 1 944 1939 45 27 438 1940 33 789 1941 2 34,798 1942 1,255 10 646 1943 1 ,890 1945 3,091 4,773 8 421 1946 1,146 (*) 423 633 3,467 1 33 1 1947 9,765 25,102 22,154 33,553 72 109 156 66 17 542 1948 1 32 745 I949 29 743 1950 71 4 51 ,405 * Less than .05. Source: U. S. Department of Commerce, Bureau of the Census. VI— 3 Table VI, A(4).— U. S. IMPORTS OF TOTAL NATURAL RUBBER, AND NATURAL LATEX, BY PORTS OF ENTRY, 1946-50 [Percentages of totalj District 1946 1947 1948 1949 1950 Natural rubber, dry and latex New York 5.0 70.1 2.8 13.5 2.2 1 1.2 61.8 1.4 8.8 3.8 0.4 4.5 6.0 69.7 0.2 6.5 0.3 2.7 6.3 0.8 6.2 0.2 1. 1 7.7 67.1 0.4 5.4 2.5 1.6 6.2 0.7 8.2 63.9 0.3 5.6 2 Ph il adelphi a.. ......... . Mobile 2.9 0.2 6.3 1.0 0. 1 1.4 1.4 0.7 2.4 0.4 4.2 0.3 3.2 7.7 0.3 0.4 II. 1 0.3 0. 1 Other Total 100.0 100.0 100.0 100.0 100.0 Natural latex only 12.7 35.2 46.5 24.7 0.1 28.6 36.8 34.2 0.2 27.7 38.8 29.6 0.2 29.6 42.8 30.3 (*) 25.5 New York 37.4 10. 5 0.1 1.4 (*) 0.8 1.3 0. 1 4.2 Other 0.1 0.3 0.3 Total. 100.0 100.0 100.0 100.0 100.0 * Less than 0.05 percent. Source: U.S. Department of Commerce, Bureau of the Census. Table VI, A(5).— UNITED STATES IMPORTS OF NATURAL RUBBER BY TYPES, 1948-50 Type 1948 Lona tons Percent 1949 Long tops Percent 1950 Long tons Percent Natural Latex Nos. IX and I Ribbed Smoked Sheet... Nos. 2, 3, 4, 5 Ribbed Smoked Sheet No. I Thin & Thick Latex Crepe Other Latex Crepes Nos. IX, 2X, 3X, I, 2, 3, I 4 Thin Brown Crepes Nos. 2, 3, 4 Blanket (Amber) Crepe, & I, 2 Smoked Blanket Crepe Flat Bark & Miscellaneous 32,630 164,267 300,922 12,576 13,279 51,641 135,180 24,845 4.4 22.3 41.0 1.7 7.0 18.4 3.4 29,974 178.206 222,363 17,474 12,932 56,900 I 14, 178 28,524 4.5 27.0 33.7 2.6 2.0 8.6 17.3 4.3 51,405 157,815 255,761 19,831 18,926 95,307 163,922 39,171 Total, 735,340 100.0 660,551 100.0 802, 138 6.4 19.6 31.9 2.5 2.4 11.9 20.4 4.9 100.0 Source: Rubber Manufacturers Association, Inc. VI-4 B. SYNTHETIC RUBBER Russia does not export synthetic rubber to countries other than Russian satel- lite nations, and although U. S. Government efforts to import tiny samples of some Russian-produced synthetics before World War II were successful, no imports since the war are known. In 1939, a small tonnage of Buna N rubber from Germany was imported, but none subsequently. Imports from Canada of butadiene- styrene rubber, both dry and latex, have been substantial since 1944. A noteworthy tonnage of Canadian butyl has also been im- ported. In this trade, the Canadian Government uses a New York rubber dealer as distributor- agent. By selling their surplus output in the United States at a price slightly below the fixed prices charged by the United States Government for similar types, they have been able to maintain a high rate of output in Canada, spreading their overhead costs more thinly over a greater volume of business. Negligible amounts of these imported synthetics have been re-exported. Table VI, B(l).— U. S. IMPORTS OF SYNTHETIC RUBBER FROM CANADA, 1943-50 [Long tonsj S-Type Year Butyl Grand total Dry Latex Total 1943.. 1944.. 9,681 1,362 11,043 1945.. 5,455 4,952 10,407 1946.. 7,709 7,709 1947.. 1,089 4 1,093 1948.. 1 1 , 1 36 476 1 1,612 4,059 15,671 1949.. 13,779 1^654 15,433 1,809 17,242 1950.. 17,815 2,824 20,639 5,083 25,722 Source: U. S. Department of Commerce, Bureau of the Census. Exports of domestically-produced general purpose synthetic rubber from the United States were of great importance in 1944, 1945, and 1946, while supplies of natural rubber continued scanty, but since then exports have been confined chiefly to Neoprene and N-types for which about 10 percent of the sales have been to foreign markets. During 1950 and 1951 very small amounts of GR-S and Butyl have been ex- ported to foreign countries — the domestic demand for Butyl constantly exceeded the supply and except at the end of 1951, this was also the situation with respect to GR-S. The exports of GR-S during and immediately after World War II went chiefly to our principal European allies, the United Kingdom and France, which accounted for about 70 percent of these exports in 1943-46. Other countries which received quan- tities sufficient to give them considerable wartime experience in its use include Australia, South Africa, Argentina, Brazil, Cuba, Mexico, Belgium, Italy, Spain, Sweden, Russia, and Canada. The small Butyl exports went mostly to the United King- dom and some Latin American countries. The United Kingdom, Canada, and France have been the chief buyers of Neoprene and N-Type rubbers. VI- 5 Table VI, B(2).— U. S. EXPORTS OF SYNTHETIC RUBBER, 1941-50 [Long tons] Year GR-S Butyl Heoprene N-Type Total 1941.. 572 572 1942.. 222 1,037 160 1,459 1943.. 14,937 40 2,540 631 18,108 1944.. 98,380 530 4,799 557 104,266 1945.. 76,555 980 5,837 406 83,778 1946.. 69,076 496 2,642 797 73,011 1947.. 7,951 63 2,619 756 11,389 1948.. 1,094 17 2,870 883 4,864 1949.. 1,401 177 3,330 1,574 6,482 1950.. 901 32 4,827 1,893 7,653 Source: Rubber Division, NPA and Bureau of the Census. C. RECLAIMED RUBBER Imports of reclaimed rubber ordinarily are negligible. Usually such imports consist of small across- the- border shipments from Canada. In 1950 and the first half of 1951 there were also small imports of reclaim from the United Kingdom. None of these imports are re-exported. Exports of domestically-produced reclaim average around 1,000 long tons monthly, going mostly to Canadian manufacturers of rubber goods. During the war, unusually large exports were made only in 1942, largely to the United Kingdom before the expansion of reclaiming facilities there. Table VI, C(l).— U. S. IMPORTS AND EXPORTS OF RECLAIMED RUBBER [[Long tonsj Year Imports Exports 1941 893 67 25 40 18 10 25 1,059 13,852 1944 30,406 15,717 1 1,979 1945 13,013 1946 14,461 14,555 1 1 , 428 1949 10,367 1950 1 1,741 Source: Bureau of the Census. VI -6 VII Imports, Exports, and Reexports, Significant Foreign Countries VII Imports, Exports, and Reexports, Significant Foreign Countries A. NATURAL RUBBER Most of the rubber produced in the countries of the Far East is exported di- rectly to consuming countries in North America and Europe, with much smaller quan- tities to Asia, Latin America, Africa, and Australia. A considerable portion of the rubber produced in Indonesia, Sarawak and British North Borneo customarily reaches world markets through Singapore and other Malayan ports. The Malayan statistics, however, do not show destinations of re-exported rubber separately from the exports of domestically produced rubber. The volume and sources of the Malayan imports in 1949 and 1950 were as follows: MALAYAN IMPORTS OF NATURAL RUBBER, 19^9-50 Q.ong tons] Country Indonesia: Rh i o Bangka and Billiton... Borneo Java Sumatra and other..... Total 1949 8,517 1,954 11,961 3,820 I 11,720 116,972 1950 12,260 10,619 57,183 28,919 252,276 361,587 Country Sarawak.... .. North Borneo. Thai land..... Burma Other Asia... Total . . 1919 30,918 13,312 17,030 6,051 5,798 220,111 1950 17,332 15,876 10,269 7,850 5,712 118,656 The rubber produced in Latin America is nearly all consumed in that area. The rubber produced in Africa is practically all exported, from Liberia direct to the United States, from other countries to the United Kingdom, France, Belgium, Germany, and the United States. Traditionally, the movement of rubber from Southeast Asia to the American and European markets is westward, through the Suez Canal and the Mediterranean. This direction of shipments aided European shipping and banking interests and strength- ened the British and Dutch position in the world trade in rubber. This traffic was interrupted after Mussolini's conquest of Ethiopia, and much of the rubber shipped to Europe went around the Cape of Good Hope, while shipments to the United States went increasingly across the Pacific and through the Panama Canal to our Atlantic ports; entries into our Pacific ports also increased. Previous to this time, United States purchases from secondary rubber markets in Europe (London, Liverpool, Amster- dam, Rotterdam) had been fairly important, but while contracts are still often made through those markets, the rubber we import is now usually shipped direct from the Far East to the United States. The statistics with respect to imports and re-exports of rubber for certain European countries are often not very revealing with respect to the tonnage of rub- ber actually handled. Such statistics may, or may not, include transit trade, or trade through Free Ports. However, the quantity of rubber that actually passes in and out of such ports as London, Liverpool, Amsterdam, Hamburg, and .Brussels, en route to other European countries, while important in their trade, is not of par- ticular concern to the United States under normal circumstances. Only when we are interested in determining how much rubber is reaching a certain, destination which conceals its imports, as in the case of Germany before World War II, or in the case of Russia today, is this a matter of much concern to us. Another factor which adds to the difficulty of tracing the movement of rubber is the fairly common, and commercially convenient, practice of shipping rubber from the Far East under an open bill of lading on a ship bound for European and United VII — 1 States ports. The shipper may elect to land the rubber at any port where he finds a buyer while the ship is en route. While the rubber may be recorded in statistics of the country of export as destined for the United Kingdom, it may be unloaded actu- ally at ports either on the Continent of Europe or in the United States. In a period of rising market prices, an increasing percentage of the shipments from the Far East are likely to remain unsold until they are near ports of arrival. In recent years there has been an increasing volume of shipments northward from Southeast Asia to China (or to Russia via China), in addition to the regular move- ment to Japan, China, Hong Kong, and Korea. Certain Latin American countries once obtained Far Eastern rubber by purchase and re-export from the United States and the United Kingdom, but now import directly from the Far East. Australia and South Africa receive their supplies direct from the Far East. Table VII, A(l) shows the new supply or net imports (gross imports, less re- exports if reported) of countries which in recent years are taking 5,000 long tons or more natural rubber (dry and latex) in any, year. Statistics for the war years 1941-45 are faulty and have been omitted. In connection with this table, remember that the Far Eastern production- of rubber in 1936-40 was restricted, under terms of the International Rubber Regulation Agreement, far below the then capacity of pro- duction which was around 1,600,000 tons a year. The severity of restriction was less in 1937 and 1940 than in the other years. The net imports into the United States exceeded 800,000 long tons only in 1940 and 1941, when shipments to the Con- tinent of Europe were almost terminated by the war, and restrictions on production were being reduced. The 1936 clearance of stocks accumulated in the United Kingdom resulted in an excess of 1936 exports over imports for that country. In 1946, the shipment of rubber stocks found in Japan to the United States caused a similar re- sult. In Table VII, A(2) the estimated imports of natural latex into principal con- suming countries are separately shown for years 1946-50. One European country for which statistics of in-transit trade in rubber have been published is the Netherlands. Part of the rubber is actually handled in Dutch ports, but in many cases it remains on the ships of arrival and is reconsigned to other countries with mere document records of the in-transit transaction, it is be- lieved. Statistics showing the destinations of the important in-transit rubber trade through the Netherlands are shown for years 1947-50 in Table VII,- A(3). Much of this rubber was imported from Indonesia, which at that time was a colony of the Netherlands. This volume of in- transit trade declined in 1950, when Indonesia was granted her independence. The United Kingdom has a larger re-export trade in natural rubber than any other consuming country. Table VII, A(4) shows the British re-exports for 1946-50. During 1946, the British Government made large imports from Malaya until British stocks became unwieldy, when they sold some 80,000 tons to the United States Govern- ment, resulting in the heavy re-exports in 1947 to the United States. At various times the re-exports to Russia have been fairly important. VII- 2 Table VII, A( I ).— ESTIMATED NEW SUPPLY OF NATURAL RUBBER, PRINCIPAL COUNTRIES 1936-10 and 1916-50 [l,000 long tons] Country 1936 1937 1938 1939 1910 1916 1917 1918 1919 1950 Austria.. »,.»..,. Belgium..... Czechoslovakia... Denmark... . France. .... Germany.... Hungary.... Italy...... Netherlands....... Poland............ Spa i n» ........... . Sweden... Switzerland....... Un i ted K i ngdom. . . , UlblOlKsilRlSIKIt Other Europe...... Union of South Africa. Argentina. .... ... ... Brazi 1.............. Canada,, ............. Mexico.............. British Malaya...... China. Hong Kong India. ........... «.. Indonesia. .......... Japan. .............. Austral i a.. ...... ... All others. ......... Total Foreign..., United States....... Grand total... 3.1 9.6 8.8 3.2 57.0 71.8 2.8 16.5 2.9 1.8 6.7 1.6 1.8 (7.1) 31.0 9.8 1.1 5.6 2.3 27.9 2.7 0. 8. I. 5. I. 61. II. 1 5 7 3 7 1 9.0 371.1 175.6 3.8 15.0 13.1 2.6 59.1 98.2 3.1 21.0 1.3 6.1 2.1 6.7 2.1 91.0 30.5 11.9 6.2 9.5 2.8 36.1 1.2 0.6 5.3 1.2 7.2 2.0 62.2 19.3 13.1 7.8 11.3 9:9 2.9 58.1 90.2 3.1 28.2 5.1 7.8 2.1 8.3 2.6 132.0 26.8 11.8 5.5 7, 3. 25. 2. 0. 2.8 1.2 5.7 2.3 16.3 12.3 11.3 I.I 9.6 5.0 2.9 61.1 75.0 2.6 18.0 7.1 6.0 3.6 9.3 2.5 69.2 30.0 8.8 9.8 9.6 5.1 32.5 5.1 0.5 1.6 2.2 7.0 3.2 12.1 15.1 10.7 ( X ) 3.0 ( X ) 1.6 30.0 17 2 20 I 3.2 3.0 2.2 199.1 20.0 9.1 9.1 9.1 7.0 52.6 3.1 1.1 5.5 2.3 II. 3.7 10.7 19.0 10.6 0.5 1.7 0.8 2.0 56.6 2.0 0.3 10.3 1.7 1.1 2.1 5.9 1.9 231.8 9.5 1.3 12.1 1.9 11.8 11.7 5.0 1.0 12.1 1.7 15.3 0.5 (10.1) 17.0 6.1 1.5 13.8 11.8 3.2 61.0 12 2 28 9 2 10.2 15.2 1.3 1 10.0 35.0 11.1 13.0 28.1 17.0 31.6 7.7 3.2 22.2 9.3 16.1 1.0 11.7 23.6 13.2 517.5 592.5 538.6 106.1 163.5 186.5 188.1 811.6 131.2 396.3 515.7 681.3 817.5 1,110.0 915.0 950.0 1,300.0 827.5 ,230.0 3.8 12.7 23.1 5.2 81.0 18.9 3.0 28.1 13.7 3.6 6.5 11.3 5.3 187.0 100.0 18.0 16.3 1.7 20.0 12.7 11.1 6.2 21.0 0.5 18.1 3.1 29.9 28.7 23.9 781.3 728.7 ,510.0 8.2 11.7 27.5 5.1 90.3 83.1 8.5 29.2 10.9 12.0 7.1 21.6 1.3 155.3 105.0 21.2 17.2 7.2 21.0 10.0 10.0 6.9 27.5 1.5 18.3 9.1 11.1 22.7 28.3 855.7 651.3 1,510.0 7 12 22 5 95 90 6.5 36.8 12.7 5.5 6.3 13.9 1.9 222.2 82.5 22.1 21.1 17.5 21.0 16.3 II. I 9.0 70.0 0.2 15.6 8.7 58.8 35.9 33.5 998.9 793.6 1,792.5 1 Included in Germany. Note: For most countries figures represent net imports, but for producing countries such as Brazil, British Malaya, India, and Indonesia they approximate domestic consumption. Statistics for postwar Germany are for Western Germany only. Figures in parentheses are minus figures, indicating excess of re-exports over imports. Source: Rubber Statistical Bulletin, Secretariat of the International Rubber Study Group. Table VII, A(2).— ESTIMATED NET IMPORTS OF NATURAL LATEX, PRINCIPAL COUNTRIES 1916-50 Lin long tons] Country 1916 1917 1918 1919 1950 2,180 33 79 211 327 8,111 281 1,013 710 312 600 1,109 2,831 9,835 1,118 2,732 903 108 1,129 1,667 2,163 11,112 1,892 2,696 775 591 1,076 2,230 1,382 15,905 1,000 1,702 1,310 891 1,733 3,615 5,936 3,133 7,867 15,033 17,167 20,255 32,715 21,757 29,713 38,095 51,105 1 1,000 32,500 53,000 51,500 89,500 Source: Secretariat of the International Rubber Study Group. VII- 3 Table VII, A(3). -NETHERLANDS IN-TRANSIT SHIPMENTS— CHIEF DESTINATIONS— 1 9M7-50 Qln long tons] Country 1947 1948 1949 1950 Country 1947 1948 1949 1950 United States..... United Kingdom.... Austria. Belgium Bulgaria.! Czechoslovakia.... Denmark Finland... i France Germany Hungary.. Italy... Norway...... 1,661 3,450 729 1,746 33,394 7,334 727 3,536 8,196 356 2,481 3,329 265 343 5,187 15,838 1,681 1,515 966 89,974 2,946 2,027 3,917 246 8,521 131 187 4,545 20,634 4,476 1,613 765 38,842 11,126 2,872 6,304 78 1,770 380 642 7,084 25,150 2,145 1,671 424 Poland Portugal.... Spain. Sweden...... Switzerland. U.S.S.R 3,618 724 134 188 1,174 4,350 Yugoslavia.. Mexico Venezuel a. . . Palestine... Others 2,333 5 265 978 506 24 5,476 4,072 21,540 610 151 51 96 226 Total . 24,570 80,955 173,712 Source: Secretariat of the International Rubber Study Group. Table VII, A(4).— UNITED KINGDOM RE-EXPORTS OF NATURAL RUBBER 1946-50 [jn long tons] Destination 1946 1947 1948 1949 1950 United States.. Austria Belgium Bulgaria Czechoslovakia. Denmark Ei re Finland France Germany.. Greece Hungary Italy Netherlands. ... Norway... ...... Poland Portugal Rumania Spain Sweden. Switzerland.... Turkey... U.S.S.R 7,277 119 74,900 447 490 18,048 288 482 1,274 1,141 1,240 368 2,907 1,941 89 190 10,876 1,441 809 884 480 Yugos 1 av i a. Argentina Canada Chile Mex ico Uruguay Venezuela Morocco. Union of South Africa. China Israel Palestine Austral ia Others.; 2,742 3,033 1,917 130 205 1,880 1,500 2,469 260 950 340 1,734 44 1,896 30 176 6,238 969 795 10,938 145 90 551 151 14 117 805 337 91 6,022 500 197 18 235 15 9 5,810 267 2,496 287 364 3,722 13 332 338 62 127 320 289 771 747 41 I 46 404 591 13 105 26 84 55 15 16 168 4 26 161 881 18 71 45 81 5 132 Total, 47,614 108,143 36,780 12,672 705 617 401 3,917 197 2,578 213 580 2,918 51 275 626 144 301 149 107 18 237 289 574 45 482 828 464 274 65 50 39 32 258 3 800 185 p ■ • 41 31,135 Source: Secretariat of the International Rubber Study Group. VII-4 B. SYNTHETIC RUBBER Few countries publish records of imports or exports of synthetic rubber. How- ever, records of its estimated consumption are available for the principal foreign countries which have used it during and since World War II, except Russia. These consumption statistics as shown below reflect imports, except in the cases of Canada and Germany, where domestically-produced synthetics were used. The imports into Continental European countries in 1941-44 were from Germany; for subsequent years chiefly from U. S. and Canada. ESTIMATED FOREIGN CONSUMPTION OF SYNTHETIC RUBBER, 1940-50 [jn | ,000 long tonsj] Year Un i ted Kingdom France Germany Other Europe Canada Austral ia Other countries Total 1943.... 1944.... 1945.... 1 946 1 947 3.3 41.8 63.8 30. 1 2.8 2.6 2.4 2.8 6.1 10.2 5.4 17.4 28.7 12.6 7.4 8.3 7.4 40.0 50.5 69.0 88.5 80.0 22.5 11.9 7.9 4.4 2.2 3.4 15.3 20.8 16.2 14.0 16.0 34.4 12.8 3.6 3.5 5.3 3.7 24.7 35.9 29.6 29.2 20.6 18.1 22.6 0.1 4.8 4.4 0.2 0.2 0.2 0.2 0.3 5.0 12.6 11.9 1.2 0.6 0.5 0.4 40.0 65.8 95.9 122.2 171.0 173.0 151.0 66.7 39.4 35.2 42.1 Source: Statistical Bulletin, Secretariat of International Rubber Study Group. C. RECLAIMED RUBBER The international trade in reclaimed rubber is unimportant. Canada imports most of the reclaim exported from the United States. The United Kingdom exports regularly to some of the British possessions and small amounts to Europe. French and German manufacturers of reclaimed rubber make small shipments to other European countries. The following statement shows the Canadian annual imports and the British annual exports of reclaim for recent years. |_ln long tons] Year Canadian imports of reclaim British exports of reclaim 10,187 10,142 10,749 9,797 8,968 9,774 1 ,151 756 1 ,434 2,147 3,153 1950 5 164 Source: trade. Official Canadian and British statistics of fore gn VII-5 VIII World Stocks of Rubber VIII World Stocks of Rubber A. NATURAL RUBBER High grade plantation rubber in dry forms, properly packed and warehoused under good conditions of cool temperature, mild humidity, and freedom from sunlight will deteriorate very little in a period of several years. In 1925, rubber that had been stored in London warehouses since 1921 was in excellent condition, and some of the best smoked sheet rubber in the United States strategic stockpile in 1951 was ac- quired before the end of 1941. Long storage of natural latex is not recommended, although anti-coagulants and periodic agitation make it storable for extensive periods. Stocks of natural rubber should be thought of in three groups: (1) stocks in producing countries; (2) stocks afloat at sea; and (3) stocks in consuming coun- tries, with Government strategic stocks as a subdivision. Producers seldom maintain facilities for warehousing large stocks of natural rubber. Ordinarily the estate holdings represent mere working stocks — varying from two to four weeks production. In producing countries, stock accumulations usually occur mainly in holdings by traders and exporters at trading centers and ports, and chiefly in Malaya. Sometimes a lack of shipping space will result in temporary ac- cumulations at ports. Normally, the stocks of rubber in hands of producers and dealers in all producing countries have averaged less than' two months production; larger quantities reflected unusual conditions such as anticipation of reduced ex- port taxes, lack of shipping, etc. A general change merely from eight weeks to seven weeks holdings in a month, however, would mean about 40,000 tons less of rub- ber shipments for the month at the recent rate of production. Table VIII, A(l) shows statistics of world stocks in producing countries at the end of each year from 1946 to 1950 as estimated by the Secretariat of the International Rubber Study Group. It should be noted that reported statistics are available for only Malaya, Ceylon, and Indochina. Table VI It, A( I ). — ESTIMATED YEAR-END STOCKS OF NATURAL RUBBER IN PRODUCING COUNTRIES, 1946-50 [ In I ,000 long tons] Country 1946 1947 1948 1949 1950 Malaya: Estates Dealers Port Stocks Indonesi a: Estates Other (estimated). . Ceylon: Estates Dealers. Vietnam and Cambodia: Estates. Dealers Belem and Manaos All other (estimated). Total 18.7 21.9 107.6 93.0 22.8 25.5 35.0 40.0 4.7 7.6 6.1 9.7 4.5 5.5 18.7 6.0 7.0 6.6 12.4 14.2 24.6 89.3 24.8 13. x 24. II. 8. 5.9 7.3 9.2 15.9 22.0 82.1 19.2 13.0 x 34.5 10.2 9.1 5.7 9.3 10.8 21.6 15.4 86.8 34.3 15. I 39.9 7.7 6.4 4.7 4.6 4.2 25.9 237.5 230.0 235.0 237.5 245.0 1 These estimates are probably conservative (Holt). Source: Secretariat of International Rubber Study Group. VIII — 1 During World War II, Indochina was the only Far Eastern country cut off from world markets which continued to produce rubber on a large scale in anticipation of the post-war demand. At the end of 1944, there was some 165,000 tons of rubber in that country ready for marketing; most of this was exported before the end of 1946. The stocks of rubber afloat at sea are not reported and tabulated. The month- end tonnage is estimated by the Secretariat of the Rubber Study Group, since 1945, by calculations based upon the difference between world exports and world net im- ports. About two months shipments were thus estimated afloat at the end of 1946, 1947, and 1948, but in 1949 and 1950 the year-end figures declined to an average of 1.75 months, and in the first eight months of 1951 the average month-end tonnages was 1.69 months shipments. ESTIMATED NATURAL RUBBER AFLOAT, YEAR-END End of— 1,000 long tons Months' shipments |ot^7 210.0 240. C 235.0 227.5 275.0 245.0 2.0 2.0 2 1949 1.7 1950 1.8 l95l(August) 1.9 The tonnage of rubber afloat tends to rise and fall with the rate of rubber production and shipments, but is also affected by the changing destinations. Many shipments to the United States are afloat for two months or more, shipments to Europe may average only one month in transit, shipments to Japan, China, and Australia only three weeks. As foreign countries take an increasing percentage of world production, the tonnage afloat tends therefore to diminish. The stocks of natural rubber in foreign consuming countries are in several cases reported monthly, but for most small countries the statistics are not col- lected and the only data available are estimates by the Secretariat of the Inter- national Rubber Study Group. Their statistics are shown in Table VIII, A(2). Under the United Kingdom, warehouse stocks represent mainly holdings by rubber traders, and Government stocks since 1947 are estimates by the NPA Rubber Division. Under France, the Government stocks are likewise estimated by the writer, on the basis of net imports and consumption adjusted for variations in the reported industry stocks, the unaccounted-for balance being entered as Government stocks. Table VIII, A(2).— ESTIMATED STOCKS OF NATURAL RUBBER IN FOREIGN CONSUMING COUNTRIES, 1940-50 [in 1,000 long tons] United Kingdom France Ge many Aus- tral ie Brazil 2 Canada Imlia^ Others Year Manu- facturer* Ware- house Govern- ment In- dustry Govern- nent Total 1940.. 1941.. 1942.. 1943.. 1944.. 1945.. 1946.. 1947.. 1943.. 1949.. 1950.. 20. 3 33.0 17.6 14.8 10.3 7.8 17.0 27.0 31.2 23.8 25.9 35.4 5.1 9.2 19.2 15.4 12.3 40.6 59.6 42.7 45.4 37.1 44.7 164.0 91.0 4 69.9 *S2.8 4 55.9 5.6 0.7 0.1 0.8 27.6 30.5 28.1 13.7 10. 1 4 13.5 4 12.7 9.0 3.5 2.5 5.5 2.5 1.0 0.8 1.8 2.8 13.3 11.7 5.0 7.5 11.6 10.2 4.4 3.3 4.7 4.6 7.0 3.2 5.5 I 1 ) t 1 ) ( x ) (!) 2.5 4.4 4.1 1.0 20.0 32.5 22.3 8.2 5.4 3.7 5.9 5.3 5.8 5.2 3.4 5.7 7.3 9.0 15.0 11.7 9.1 10.3 9.0 7.7 8.4 6.3 45.0 70.0 100.0 140.0 95.0 45.0 25.0 62.5 47.5 57.5 80.0 lfo6.6 218.5 2C6.4 239.1 166.5 115.4 255.3 243.4 223.6 210.4 224.8 1 rot available. 2 Stocks in Southern Brazil consuming areas. 3 Excluding producers stocks, culated by NPA Rubber Division from imports, consumption, reexports, and reported stocks. Source: Based on Reports of Secretariat of International Rubber Study Group. VIII — 2 Cal- Stocks of natural rubber in the United States, until 1939, were entirely in the hands of (1) manufacturers, and (2) merchant importers and dealers. Since 1939, the United States Government has, in addition, held large stocks for strategic purposes. Table VIII, A(3) shows the year-end industry and trade stocks since 1921, and their total in terms of months' supply based on consumption of natural rubber (dry and latex) during each year. Table VIII, A(3).— ESTIMATED STOCKS OF NATURAL RUBBER IN THE UNITED STATES, 1921-50 [Long tons] End of— Manu- facturers Importers and dealers Total Months' supply 1 End of— Manu- facturers Importers and dealers Total Months' supply 1 1921. 1922. 1923. 1924. 1925. 1926. 1927. 1928. 1929. 1930. 1931 1932 1933 I93'4 1935 n. a. n. a. n.a. n. a. 41,553 61,887 80,095 50,524 68,327 137,500 2m, 147 309,000 251,000 243,1156 180,295 n.a. n.a. n.a. n.a. 9,662 10,623 19,187 14,930 50,282 63,500 107,853 70,000 114,000 111,544 122,705 99,758 94,653 76,758 57,717 51,215 72,510 99,282 65,454 118,609 201,000 322,000 379,000 365,000 355,000 303,000 6.73 3.77 2.88 2.11 1.58 2.38 3.19 1.80 3.05 6.41 10.88 13.51 10.62 9.21 7.40 1936. 1937. 1938. 1939. 1940. 1941. 1942. 1943. 1944. 1945. 1946. 1947. 1948. 1949. 1950. 156,673 167,300 134,700 90,500 142,904 n.a. n.a. n.a. n.a. n.a. n.a. 102,115 107,867 76,032 56,932 66,327 94,900 96,800 35,300 33,466 n.a. n.a. n.a. n.a. n.a. n.a. 26,923 33,674 30,587 32,283 223,000 262,200 231,500 125,800 176,370 145,366 74,530 34,500 17,668 19,701 69,073 129,038 141,541 106,619 89,215 4.65 5.79 6.36 2.55 3.26 2.25 2.37 1.30 1.47 2.24 2.99 2.75 2.71 2.23 1.48 •"■Months' supply calculated on the basis of natural rubber consumed in the same year. n.a. Not available. Note: Statistics include all forms of natural rubber, dry and latex. Source: NPA Rubber Division and predecessor agencies. The practice of industry and trade in respect to holding stocks of rubber has been greatly influenced by Government activities in the natural rubber business. In 1921, inventories everywhere were high (in terms of months' supply). The Stevenson (British) Restriction Scheme (1922-28) retarded production of natural rubber until stocks were dangerously reduced by the end of 1924. Soaring prices in 1925 led to higher production and some rebuilding of stocks through 1927. The release of the control in 1928 led to higher production, and stocks thereafter accumulated heavily as demand was retarded during the depression of 1929-33. The International Rubber Regulation Scheme in 1934—39 followed a similar pattern, forcing stock reductions through 1936, with some rebuilding in 1937-38, then renewed severe restriction which again forced stock reductions through 1939, when the U. S. Government entered the picture through the cotton-rubber barter deal. In the 1922-28 period, manufacturers learned first the danger of allowing stocks to become too short, and second the danger of holding high stocks when con- trol ended in 1928 leaving the American rubber pool with severe losses upon liquida- tion of their holdings. In the first part of the 1934-40 period they applied the first lesson, but since Government entry into the equation as a matter of strategic necessity from the standpoint of national defense the manufacturers have never car- ried long stocks. Importers and dealers likewise liquidated all their excess hold- ings in the course of the two restriction periods, and since 1939 have held mere trading stocks with which to service their customers. Inter-trading between dealers helps each to supply the grades and qualities required by their orders from the man- ufacturers. In September, 1939, the U. S. Government through the Commodity Credit Corpora- tion, bartered 500,000 bales of cotton for 90,500 tons (final figure) of rubber. VIII-3 Since then, continuously to date, our Government has been a large holder of rubber stocks, and industry has in effect considered the provision of sufficient stocks for an emergency to be purely a Government function, to be supported by the general tax- payer. The practice of reduced private holdings relieves the industry of a finan- cial burden, and in times when they are caught short and have to pay high prices, they as a rule are able to charge higher prices for their products. In 1940, the Reconstruction Finance Corporation was assigned the task of build- ing a strategic stockpile of natural rubber. Natural rubber production being under the control of foreign Governments, Government- to-Government deals were made with the British Government as a result of which our imports were greatly increased up to the time of the Pearl Harbor attack. The RFC and Commodity Credit stocks were merged. The .industry inventories were by agreement expected to be maintained at 150,000 tons until we entered the war; thereafter they were controlled by Government regulations until 1947. As the threat of American involvement in the war increased, full jurisdiction over all imports of natural rubber was placed in RFC, whidh bought mainly through manufacturers until the United States entered the war, then through the Rubber Development Corporation until April 1, 1947, when private importation was again permitted. Throughout World War II, RFC distributed natural rubber in accordance with in- structions from the War Production Board and the Office of the Rubber Director, which successively held the directive authority. By the end of 1944 the large stocks on hand in 1941 had been used with the exception of a near minimum working residual. In late 1946, the Rubber Development Corporation purchased some 80,000 tons of rubber from large stocks accumulated that year by the British Government, and their delivery in early 19*47 coincided with the freeing of U. S. imports to pri- vate interests. It is worthy of note that the buying price for No. 1 Ribbed Smoked Sheet estab- lished by the Rubber Development Corporation in purchasing from Far Eastern sources while they remained under Allied military occupation after the war, and in purchas- ing from the British Government in 1946, was about 22 1/2 cent per pound. The American negotiators were men of experience in rubber trading and were willing to pay a fair and reasonable but not exorbitant price. They did not believe that the American public should bear the costs for rubber estate rehabilitation. The fact that the price was agreed to by the British, even though reluctantly, is evidence that in terms of money values at that time, the 22 1/2 cent price yielded a substan- tial profit over the costs of production and handling to point of delivery. The average New York free market prices of 20.8 cents for 1947, 22.0 cents for 1948, and 17.6 cents for 1949 are similarly evidential. B. SYNTHETIC RUBBER The stocks of synthetic rubber outside the United States at present are negli- gible except in Canada; they were substantial but not particularly significant dur- ing and immediately after World War II. Table VIII, B(l) shows estimated stocks for Germany during the period when the German synthetic rubber industry was active, and reported stocks for other foreign countries as assembled by the Secretariat of the International Bubber Study Group. In 1950, because of the high price of natural rubber, the available supplies of synthetic were in demand, and foreign stocks at the year-end were reduced to a low point. United states stocks of synthetic rubber are shown in Table VIII, B(2), by types of rubber. The build-up in stocks as production mounted through 1945, and the decline in 1946 and subsequently as natural rubber became available and production of synthetics declined is clearly reflected. At the end of 1947, our stocks of synthetic rubber were reduced too much in anticipation of greater imports and usage of natural rubber than actually occurred, and again in 1950 the stocks were reduced to a dangerously low point by unexpectedly high demand. They have been restored in 1951 to a satisfactory working level at the current rate of consumption. Total stocks averaged 3.17 months' supply in the 1941-45 period, and 2.06 months' supply in the 1946-50 period; the latter would appear to be near a desirable working ratio under normal circumstances. VIlI-4 Table VIII, 3( I ). —ESTIMATED STOCKS OF SYNTHETIC RUBBER OUTSIDE THE UNITED STATES, 1940-50 [Long tons] End of— United Kingdom France Germany Austral ia Canada South Africa Total 1940 7,333 55,020 17, 156 3,421 2,026 1,956 1,117 784 388 1,727 1,184 276 2,613 5,817 6,489 3,197 2,709 1,860 10,000 20,000 22,500 20,000 20,000 3,105 3,948 832 515 1 , 583' 848 67 1,126 1,164 241 253 169 231 146 2,292 3,641 4,107 4,565 4,200 4,336 4,442 3,015 16 2,974 274 134 10 000 I oi). I 20 388 1942 1943 24,227 30,876 80,079 31 1 19 1944 1945 1947 18,266 13 934 1948 10 173 1950 10,082 6,653 Source: Rubber Statistical Bulletin, Rubber Study Group. Table VIII, B(2).— STOCKS OF SYNTHETIC RUBBER IN THE UNITED STATES, 1941-50 [Long tons] End of— S-Type Butyl Neoprene N-Type Total Months' supply 1941 1942 1943 1944 1945.. 1946 1947 1943 1949 1950 — June 1950 1951 — June October (preliminary' 30 116 170 81 40 96 77 47 36 60 90 130 ,050 ,975 ,130 ,571 ,483 ,606 ,282 ,731 ,987 ,942 ,258 .112 3 4 1,033 9,392 18,378 19,473 13,184 10,995 12,224 3,793 7,243 8,071 9, 109 700 1,736 6,415 11,739 9,703 10,470 5,237 5,072 4,654 5,232 5,733 6,476 7,878 869 1,772 3,145 5,166 4,802 3,755 3,339 2,762 3,433 3,334 2,840 3,349 4,116 1,702 4,612 41,568 142,927 203,454 I 15,186 62,366 115,1 I I 98,042 65,346 52,753 78,154 111,215 3.26 3.14 2.92 3.03 3.52 1.31 1.34 3.12 2.34 1.81 1.13 1.41 1.82 Table VIII, B(3) shows the stocks of general purpose rubber (S-Type) divided between the Government and the industry at quarterly intervals for the post-war period. Only once has the industry carried large stocks, in terms of months' sup- ply; that was at the end of 1946 and early 1947 in preparation for the end of Gov- ernment buying and distributing imported natural rubber. In fact, it could be ar- gued that they have taken large risks by their practice of carrying low stocks, and certainly an "insurance" policy of carrying high stocks in 1949 would have done something to retard the decline in production which then occurred, and would have, left them better fortified to meet the tremendous demand for rubber products in 1950-51, without bringing so much pressure on the market for natural rubber and pushing its price so high. On the other hand, the steady price of GR-S during the post-war years and the fact that manufacturers always, even in 1947, had been able to obtain all of this material they really needed, with the economy in saving of warehouse and handling costs, had encouraged the practice of getting along with min- imum stocks. 247921 0—53- VIII — 5 Table VIII, 3(3).— U. S. STOCKS OF S-TYPE RU33ER, GOVERNMENT AND INDUSTRY Government Plants Warehouses Total Industry total Grand total Months' supply 1946: Varch June September. December. . 1947: '^arch June September. 1/eceiTiber. . IS43: "arch June September. Pecember. . 1949: "arch June September. December. . I9SC: 'arch June September. December. . 1951: March June September. 8,469 10,560 10, 134 10,456 8,I2S 10,902 7,955 5,121 6,601 7,522 6, I2S 7,471 6,116 7,042 7,800 7,927 5,678 5,555 4,932 7,453 8,717 10,523 11,716 23,062 12,348 22,648 17,570 31, 136 21,848 14,420 3,124 6,457 24,967 40,341 50,205 56,386 50,454 54,255 42,580 29,942 13,778 7,326 3,144 5,230 16,779 25,075 31,531 23,408 32,782 28,026 39,264 32,750 22,375 3,245 13,053 32,489 46,469 57,676 62,502 57,496 62,055 50,507 35,620 19,333 12,253 10,597 13,947 27,302 36,791 57,098 39,204 42,366 53,457 56,249 42,441 31,756 32,361 37,374 33,912 37,849 38,606 35,223 31,849 27,928 27,224 30,760 28,654 30,647 26,345 30,744 32,956 44,147 88,629 62,612 75,148 81,483 S5,5I3 75,191 54,131 40,606 50,432 71,401 84,318 96,282 97,725 39,345 89,983 77,731 66,380 47,987 42,905 36,942 44,691 60,258 30,938 1.74 1.19 1.40 1.55 1.93 1.69 1.33 1.09 1.49 2.30 2.79 3.35 3.45 3,14 3.26 2.90 2.52 1.72 1.39 1.07 I.I I 1.36 1.66 Source: MPA, Rubber Division. The Government, for its part, has been interested in the maintenance of reason- able working stocks at all times. The storage facilities at the GR-S plants are limited, and RFC has given more consideration to its holdings from the viewpoint of a fixed tonnage limit than from the viewpoint of months' supply. Their operations are most efficiently conducted with low stocks, and the tonnage carried has averaged about 33,000 long tons from 1946 through 1951. There was policy resistance in Gov- ernment circles to the warehousing of large stocks of GR-S at public expense as an insurance of industry supplies. As production declined in 1948 and 1949 however, Government stocks were built to their highest point (62,502 long tons, March, 1949) since the war, and they were well above average at the start of 1950. Members of industry have from time to time urged that carriage of large stocks of GR-S by the Government is desirable from the standpoint of national security. Industry urgings have been considered in some quarters as less than fully frank in stating the reasons for their advocacy. There are sound technical reasons for avoiding large accumulations of GR-S, aside from warehousing and increased handling costs which it would entail. The principal technical objection is that the sub- types of GR-S produced are constantly being changed and improved. The newest types are quick in winning popularity, and are usually in greatest demand; the disposal of types becoming obsolescent is always difficult and sometimes a price discount is necessary. Consequently, the types that could most readily be stockpiled at any time would be chiefly those least in demand, and hence most difficult to dispose of later, which would make rotation complicated. For example, today there is demand for all the cold rubber that can be produced; only hot GR-S could be stockpiled VIII — 6 unless sales of the cold rubber were curtailed to permit its stockpiling; perhaps tomorrow's demand will be for oil-extended types. It would seem on the basis of experience to date, that our greatest need for high stocks of GR-S is when its production is low, and that large stocks when pro- duction is high are to be avoided. However, the dangers of accumulating obsolescent types are paramount. C. RECLAIMED RUBBER Throughout the world, the general custom is to carry only necessary working stocks of reclaimed rubber. This material is nearly all used in the countries where it is produced. Many small reclaiming plants with limited equipment are adjuncts of company establishments engaged in the manufacture of rubber products. Table VIII, C(l) provides statistics of stocks of reclaim in countries which report this information, for years since 1945. In this table, the United States stocks are reported in months' supply as well as tons. American manufacturers of reclaim adjust their production closely to the demand and avoid large stock accumu- lations, and this is apparently the situation in other countries. Protective inven- tories of scrap rubber are held by American reclaimers, and their productive capac- ity has always been great enough to enable them to meet promptly the rising demands of industry in past emergencies, although this has at times caused stocks to be tem- porarily reduced to a bare minimum working level. Table VIII, C( I ).— REPORTED STOCKS OF RECLAIMED RUBBER [Long tons] United States United Kingdom Germany Austral ia End of— Stocks Months' supply Canada 1945 1946 1947 28,155 33,666 35,943 32,630 28,263 35,708 1.40 1.47 1.50 1.50 1.52 1.41 3,576 5,330 4,334 4,245 2,272 2,519 n. a. n. a. n. a. n.a. 3,674 3,435 1,469 818 1,347 956 692 916 2,219 3,455 2,282 1948 1,829 1949 1,845 1950 1,755 n. a. Not avai 1 able. Source: Rubber Statistical Bulletin, International Rubber Study Group. VIII-7 IX Rubber Consumption IX Rubber Consumption Previous sections deal with materials which can best be discussed under the three headings — natural, synthetic, and reclaimed rubber. Consumption, however, in the case of nations and of important manufacturers, is a composite of all these classes of rubber, and can best be discussed under regional headings. A. WORLD CONSUMPTION OF NATURAL AND SYNTHETIC RUBBER The broad picture presented in table IX, A(l), shows the world consumption rising despite depressions and war during the past thirty years. A continuing rise in consumption is the logical expectation. However, there have been years of sharp recession, and because of the uncertainties of economics it is not safe to project a definite tonnage year by year into the future even if world peace is assumed. The increase in consumption, percentagewise, tends to diminish as the base becomes larger. It is a striking fact, however, that the average consumption in each decade has been higher than the peak consumption in any year during the preceding decade. Table IX, A( I). —WORLD CONSUMPTION OF NATURAL AND SYNTHETIC RUBBER, 1920-50 \\r\ 1 ,000 long tons] Year 1 Jnited State s Other countries World total Natural Synthetic Total Natural Synthetic* Total Natural Synthetic* Total 1920 206.0 177.8 301 .5 206.0 177.8 301.5 319.4 328.8 388.5 366.2 373.0 437.0 467.4 91.5 99.7 103.5 91.5 99.7 103.5 297.5 277.5 405 297.5 1921 277.5 1922 405.0 1923 319.4 328.8 388.5 366.2 373.0 437.0 467.4 125.6 136.2 164.0 176.3 222.0 248.0 337.6 125.6 136.2 164.0 176.3 222.0 248.0 337.6 445.0 465.0 552.5 542.5 595.0 685.0 805.0 445.0 1924 465.0 1925 552.5 1926 542.5 1927 595.0 1928 685.0 1929 805.0 1930 376.0 355.2 336.7 412.4 462.5 491.5 575.0 543.6 376.0 355.2 336.7 412.4 462.5 491.5 575.0 544. 1 334.0 327.3 353.3 410.1 457.5 448.5 470.0 546.4 334.0 327.3 353.3 410. 1 457.5 448.5 470.0 548.9 710.0 682.5 690.0 822.5 920.0 940.0 1,045.0 1,090.0 710.0 1931 682.5 1932 690.0 1933 822.5 1934 920.0 1935 940.0 1936 1,045.0 0.5 2.5 3.0 1,093.0 437.0 1.0 438.0 518.0 5.0 523.0 955.0 6.0 961.0 592.0 2.0 594.0 513.0 13.0 526.0 1,105.0 15.0 1,120.0 648.5 2.9 651.4 461.5 39.6 501.0 1,110.0 42.5 1,152.5 775.0 6.3 781.3 465.0 66.2 531.2 1,240.0 72.5 1,312.5 376.8 17.7 394.5 388.2 94.8 483.0 765.0 112.5 877.5 317.6 170.9 488.5 297.4 121.6 419.0 615.0 292.5 907.5 144.1 566.7 710.8 243.4 170.8 414.2 387.5 737.5 1,125.0 1945 105.4 693.6 799.0 157.1 171.4 328.5 262.5 865.0 1,127.5 277.6 761.7 1,039.3 277.4 150.8 428.2 555.0 912.5 1,467.5 1947 . 562.7 559.7 1,122.4 547.3 65.3 612.6 1,110.0 625.0 1,735.0 627.3 442. 1 1,069.4 795.2 37.9 833.1 1,422.5 480.0 1,902.5 574.5 414.4 988.9 863.0 35.6 898.6 1,437.5 450.0 1,887.5 720.3 538.3 1,258.6 984.7 41.7 1,026.4 1,705.0 580.0 2,285.0 "Exclusive of Russian-produced synthetics. Source: Compiled by NPA Rubber Division. IX- 1 Throughout the history of rubber consumption until about 1905, the United States usually consumed between 40 and 45 percent of the natural rubber used annu- ally in the world. Mass production and widespread use of automobiles in this coun- try, and the effects of World War I, boosted our percentage to above 70 for a time following that war. Then the consumption in foreign countries began to grow more rapidly than in the United States, until just before World War II our country was using between 45 and 50 percent of the natural rubber consumed annually. In World War II and the years immediately after, our percentage of total natural and syn- thetic rubber increased again, but since 1947 other countries have been increasing their consumption rapidly. Our swing to the use of synthetic rubber makes us less dependent on foreign sources of natural rubber. Other countries except Russia and Canada are using nat- ural rubber almost exclusively. It results that natural rubber-producing countries, while still finding their largest individual market for natural rubber in the United States, are gradually becoming overwhelmingly dependent on the aggregate market elsewhere for their sales. When our stockpiling of natural rubber ceases, this will become more apparent. This situation seems likely to continue until and unless leading foreign rubber-consuming nations turn to increased use of synthetic rubber. Whether this will affect the political leanings of rubber-producing countries is worthy of consideration. In this connection, although Russia produces and uses large quantities of syn- thetic rubber [not included in the statistics in IX, A(D], Russia in the last few years has been importing natural rubber at the rate about three times the prewar rate, probably stockpiling a substantial quantity. It is unlikely that Russia will in any predictable future period rival the United States as a consumer of natural rubber. The United Kingdom and the Empire countries, however, bid fair to rival us in the not too distant future, particularly if we continue to consume large amounts of synthetic and they continue to use natural rubber almost exclusively. If a time of economic distress for natural rubber producers should come, the UK and Empire would presumably support the Malayan rubber-producing industry as much as possible. France uses more natural rubber than Indochina (Viet Nam and Cambodia) produces, and once in the past supported the industry in Indochina by a tax on con- sumption in France. Brazil and India consume the rubber produced locally; the for- mer subsidizes production, and India probably will do so if prices are low in future. Indonesia, Thailand, and Ceylon since its independence, are the independent Far Eastern producing countries which would in such a case have to seek a market where it could be found. At present, the United States is buying nearly all the Thai out- put. The average world consumption has risen from 548,000 long tons in 1921-30 to 942,000 in 1931-40, and to 1,463,000 tons in 1941-50. The depression of the early 1930' s retarded consumption in that decade. Since then, deficit spending throughout the world has been a factor boosting rubber consumption. The 1950 total stands out far above all previous records for world rubber consumption. B. UNITED STATES (a) Consumption of Rubber By Types The types of rubber consumed in the United States since 1935 are reported in table IX, B( 1) , p. 3. The types of rubber are purposely set forth in some detail, in order to emphasize their multiplicity. Except in the 1942-46 period of World War II, when consumption was by Government regulation forced to employ the available types of rubber, the choice of the industry as to materials has been heavily influ- enced by economic considerations. In a comparatively free industry, the tendency has been to use the lowest-priced material that would result in the production of goods of adequate quality. "Adequate quality" includes the demands of ultimate consumers for finished goods of varying qualities depending upon prices and consumer incomes, and is there- fore not a fixed standard for years of prosperity and years of business depression, or for low income as well as high income owners of motor vehicles. Furthermore, IX— 2 adequate quality during peacetime is different from what we can get by with ade- quately during wartime, when vehicle speed and load restrictions, for example, can be used to reduce the performance requirements of tires. In the early 1930 s the price of natural rubber was very low, and the percentage use of reclaim by 1935 had fallen to a low figure; its use increased with higher prices for natural rubber in 1936 and 1937, and again in 1939-41. In most of the 1947-49 period the price of natural rub- ber of average quality was competitive with GR-S and Butyl, and there was a tendency towards increased use of natural to replace these synthetics and Neoprene. Although Butyl tubes are definitely superior to natural rubber tubes, there are many car drivers who will buy the latter at a few cents discount in price. With very high prices for natural rubber in 1950 and early 1951, the industry used all the syn- thetics and reclaim available and would certainly have done the same in absence of Government control of consumption. The tons of the different rubbers used can be added to totals, but their indi- vidual characteristics and applicabilities for particular purposes are not capable of such addition. By and large, each manufacturer builds his reputation on excel- lence of quality of his products. This naturally leads each to choose in general the particular materials which will yield the best results for the purposes in- tended. Table IX, B(l).— U.S. ESTIMATED CONSUMPTION OF RUBBER BY TYPES, 1935-50 [in 1,000 long tons] Natural SYNTH E T 1 C Total new rubber Year Dry 1 Latex 1 Total GR-S Other S-Type 4 Butyl Neop rene 2 N-Type 2 Total Reclaimed rubber Dry Latex 3 Dry Latex 1935. . 478.0 13.5 491.5 0.2 0.2 491.7 117.5 1936.. 559.6 15.4 575.0 0.3 < 0.3 575.3 141.5 1937. . 524.4 19.2 543.6 0.5 0.5 544.1 162.0 1938.. 418.5 18.5 437.0 1.0 ....... 1.0 438.0 120.8 1939.. 567.1 24.9 592.0 1.9 1.9 593.9 170.0 1940.. 620.2 28.3 648.5 . ■ • ■ ■ • .... ■ ....... ..... 2.7 ..... 0.2 2.9 651.4 190.2 1941.. 741.9 33.1 775.0 0.1 4.5 1.7 6.3 781.3 251.2 1942.. 367.4 9.4 376.8 1.0 1.6 6.6 0.2 8.2 17.6 394.4 254.8 1943.. 308.1 9.6 317.7 131.0 .2 0.8 0.3 24.8 1.4 12.4 170.9 488.6 291.9 1944.. 138.0 6.1 144.1 488.1 6.0 1.4 10.8 41.8 4.4 14.1 566.6 710.7 251.1 1945.. 101.5 3.9 105.4 583.9 14.5 1.7 43.0 35.6 6.8 8.0 693.5 798.9 241.0 1946.. 271.9 5.7 277.6 607.9 23.5 0.7 79.2 31.4 13.0 6.0 761.7 1,039.3 275.4 1947.. 548.8 13.9 562.7 423.8 22.5 2.3 68.8 31.2 6.5 4.5 559.6 1,122.3 288.4 1948.. 598.8 28.5 627.3 312.7 21.5 II. 1 58.9 26.5 5.2 5.8 442.1 1,069.4 261.1 1949.. 538.4 36.1 574.5 277.9 21.5 21.7 52.7 28.0 3.8 3.8 414.4 988.9 222.7 1950.. 664. 1 56.1 720.2 357.4 31.0 27.8 66.3 38.3 5.5 11.9 538.2 1,258.4 303.7 ■Approximate through 1941. 2 Approximate through 1940. 3 Approximate, including domestic and imported S-Type latex. 4 Includes imported S-Type (from Canada), and privately produced S-Type (High-sty rene). Source: NPA Rubber Division and predecessor agencies, and Commerce Department records. It is customary to speak of GR-S as general purpose rubber, and as a single material, capable of replacing natural rubber in a wide range of applications. But GR-S is a blend (copolymer) of butadiene and styrene. Butadiene may itself be polymerized to make a soft rubber-like material of limited usefulness; styrene is polymerized to make hard plastic products; the blend can be anything between these extremes. Natural rubber similarly includes a wide range of types and qualities. IX— 3 It would be preferable to think of all rubbers as special purpose, today, in- stead of describing some as general purpose. The plantation rubber producers have brought out special products for particular applications from time to time. It is approaching a situation in which all rubbers are tailor-made for special uses, not merely in particular products, but also in particular parts of products, and in lines of different quality and different price levels. The consumption of latices amounted to 92,600 long tons in 1950, or 7.36 per- cent of total new rubber consumption, compared with 4.35 percent in 1940. Consump- tion of latices has shown very rapid growth since the war. (b) Consumption of Rubber By Uses Information on this subject is incomplete and spotty, but reasonably indicative of the relative importance of principal products in our total consumption of rubber and of the relative usage of synthetic rubbers and natural rubber in major products for stated periods. Statistics of the Rubber Manufacturers Association, Inc. , relative to the pre- war consumption of natural rubber in main classes of products, are shown in table IX, B(2), below for the 1935-40 period. The statistics are incomplete; those for consumption in tires and tubes are known to be more complete than those for tire sundries and repair materials, or than those listed under "other rubber products." Pneumatic casings for motor vehicles were of course the leading item, followed by mechanical rubber goods, inner tubes, boots and shoes, heels and soles, etc. Estimates of new rubber consumption by products, purporting to be complete, have been made for the twelve months ended March 31, 1941, and the calendar year 1949. These are shown in table IX, B(3), p. 5. The 1949 consumption in individual transportation products shown in this table were worked out with a high degree of accuracy; the other estimates are rough approximations. Note that the consumption is separately shown for different classes of tires, and for different classes of in- ner tubes. The 1949 figure for consumption in wires and cables is officially com- piled and not an estimate. Table IX, B(2).— U. S. CONSUMPTION OF NATURAL RUBBER BY CLASSES OF PRODUCTS, 1935-10 [Long tons] Product 1935 1936 1937 1938 1939 1910 TIRES AND TIRE SUNDRIES Pneumatic casings (all types except bicycle & aeroplane Pneumat i c tubes Farm tractor tires and tubes Bicycle tires including juvenile pneumatics Aeroplane tires and tubes Motorcycle tires and tubes < Solid and cushion tires for highway transport All other solid and cushion tires , Tire sundries and repair materials Total — tire and tire sundries OTHER RUBBER PRODUCTS Mechanical rubber goods Boots and shoes > Insulated wire and cable compounds i Druggist sundries, medical and surgical goods , Stationers' rubber goods Bath i ng apparel Rubber clothing Automob i 1 e fabr i cs < Other rubberised fabrics Hard rubber goods Heel s and sol es Rubber flooring Sponge rubber * Information not available. 272, 391 41,105 ( :!: ) 2,167 134 (*) 1,094 365 8,021 294,443 43,582 (*) 3,361 163 (*) 505 757 6,701 275,981 41,643 (*) 2,908 185 (*) 487 627 7,559 206,132 31,174 (*) 1,923 210 (=:=) 305 154 8,093 278,738 40,763 (*) 2,848 301 (*) 239 366 10,437 325,280 38,887 18,239 4,679 3,421 1,680 789 1,020 656 4,075 2,038 10,271 780 3,662 349,512 44,717 21,329 6,426 3,205 2,005 991 565 494 4,180 2,203 8,749 1,002 3,107 329,390 46,772 20,150 7,193 3,781 1,996 952 575 425 4,015 2,484 9,635 1,150 4,131 247,991 27,351 13,029 5,041 2,716 1,743 596 467 369 3,499 1,711 9,904 833 2,706 333,692 40,470 15,637 5,639 3,859 2,181 586 497 338 4,196 2,561 12,888 1,231 4,720 286,254 41,007 10,486 2,794 628 294 214 600 10,133 352,410 44,696 15,461 8,193 3,730 2,209 620 533 378 3,979 3,492 11,336 1,417 9,867 IX— 4 Table IX, B(2).— U. S. CONSUMPTION OF NATURAL RUBBER BY CLASSES OF PRODUCTS, 1935-10— Continued [Long tons] Product 1935 1936 1937 1938 1939 1940 OTHER RUBBER PRODUCTS— Continued 2,153 3,215 2,357 3,195 1,980 3,077 1,734 2,156 2,285 3,567 2,226 2,450 95,565 104,525 108,316 73,855 100,655 110,587 420,815 454,037 437,706 321,846 434,347 462,997 N. B. The above figures are not complete for the whole of the United States rubber industry. The grand to- tals given above are approximately 86 percent complete for the year 1935; 7S percent for 1936; 80.5 percent for 1937; 73.6 percent for 1938; 73.4 percent for 1939; 71.4 percent for 1940; and for 1941 the following: 1st quarter 73.2 percent; 2nd quarter 75.4 percent. Individual items would vary widely from these percentages. Source: Rubber Manufacturers Association, Inc. Table IX, B(3).— ESTIMATED U. S. CONSUMPTION OF NEW RUBBER, BY PRODUCTS, 1941 AND 1949 Product Year ended March 31, 1941 Long tons Percent Calendar year 1949 Long tons Percent res: Passenger car Truck and bus Tractor and implement. Other Total Repair materials, etc. Camel back Other Total Inner tubes: Passenger car Truck and bus Tractor and implement. Other Total Nontransport: Latex foam Boots and shoes Heels and soles Insulated wire and cable Mechanical goods: Bel ting Hose and tubing Molded and extruded Flooring and matting Thread and cement Other Coated fabrics and clothing.... Drug sundries Balloons, balls and toys Other rubber industry products. Products of other industries 7 .. Total nontransport ,. Grand total 249,000 139,000 21,000 409,000 18,000 18,000 55,000 55,000 15,000 18,000 22,000 22,000 67,000 10,000 7,000 41,000 202,000 684,000 36.4 20.4 3.1 316,511 160,912 44,058 1 8,055 59.9 2.7 529, 536 2 35, 103 3 15,838 2.7 8.0 50,941 48,044 21,352 7,531 14 2,129 8.0 2.2 2.6 3.2 3.2 9.8 1.5 1.0 5.9 79,056 28,000 17,200 32,000 30,613 16,500 17,750 13,900 10,500 20,200 5 19,750 8,750 10,000 14,200 50,007 40,000 29.4 329,370 100.0 988,903 32.0 16.3 4.5 0.8 53.6 3.6 1.6 5.2 4.9 2.1 0.8 0.2 8.0 2.8 1.7 3.2 3.1 1.7 1.8 1.4 I.I 2.0 2.0 0.9 1.0 1.4 5.0 4.1 33.2 100.0 1 Includes airplane tires 2,012 tons tons. 3 includes tire flaps 4,893 tons Includes passenger sizes 4 Includes airplane tubes ing 2,000 tons, rubber and friction tapes 3,000 tons, other products 14 rubber goods 5,000 tons, sporting goods 4,000 tons, miscellaneous sun products 20,000 tons. 7 Rubber consumed by manufacturers of paper plastic, toys and sports goods. Source: 1949— NPA Rubber Division; 1941— Rubber Manufacturers Association, Inc. 16,1 257 t,750 ldrie pa 17 tons, truck-bus tons. 5 Includes tons. 6 Include s 12,000 tons, and int, electrical, te 18,986 pack- s hard other xtile, IX- 5 (c) Transport and INon- Transport Consumption The consumption, divided between transport and non-transportation products, of total natural rubber, total synthetics, and reclaim can be estimated with reasonable accuracy for prewar years from Census data, and data was reported and compiled from 1944 onwards. With estimates for the missing years, table IX, B(4) has been con- structed providing a picture of the division of consumption between, and its trend in these two branches of the industry. Until 1943 synthetic rubber was used in tires only experimentally; nearly all the synthetics were used in non-transportation products. Table IX, B(4).— U. S. ESTIMATED CONSUMPTION OF RUBBER IN TRANSPORT AND NONTRANSPORT PRODUCTS, 1935-50 L' n 1,000 long tons] Year Total new rubber Natural rubber Percent Synthetic rubber Percent Reclaimed rubber Ratio to new rubber 1 937.. t. .......... 1939.... .......... I9M0.. ...... ...... 1941 1942 1943.............. 1944.............. 1945— first half., second hal f. Total 1946. ........... .. 1947... .......... . 1948.............. 1949.............. I ybU" » to \ * <■> ».' ■ a » * « » • 1 yoD« • ■ « » • nts i>m • ». Id0ii8««a«*"isfli*i> ... i y^y* iKitnetiiits 1 a Si 1940.......... as 1 yHZs snsa«9Bss»«0«a 1 • ■ 1944..... .. 1945— first half... I.. second half.. 9 . . Total..... .. 1948... .. 1949............... •• 1 950. .............. m ■ Transport products 378.5 424.0 442.7 457.5 525.0 269.9 348.8 491.1 309.6 280.6 590.2 771.7 830.6 744.6 659.5 818.2 113.2 120.1 151. 1 193.6 256.3 124.5 139.7 219.7 122.0 86.8 208.8 262.2 291.6 324.8 329.4 440.3 378.5 424.0 442.5 457.5 525.0 267.7 231.8 III. 4 52.5 34.5 87.0 222.8 442.7 443.0 382.6 477.5 113.0 119.6 149.2 191.0 250.0 109.1 85.9 32.7 9.1 9.4 18.5 54.8 119.8 184.3 191.9 242.8 100.0 100.0 100.0 100.0 100.0 99.2 66.5 22.7 17.0 12.3 14.7 28.9 53.3 59.5 58.0 58.4 2.2 117.0 379.7 257.1 246.1 503.2 548.9 387.9 301.6 276.9 340.7 0.8 33.5 77.3 83.0 87.7 85.3 71.1 46.7 40.5 42.0 41.6 Nontransport products 99.8 99.6 98.7 98.7 97.5 87.6 61.5 14.9 7.4 10.8 8.9 20.9 41.1 56.7 58.3 55.1 0.2 0.5 1.9 2.6 6.3 15.4 53.8 187.0 112.9 77.4 190.3 207.4 171.8 140.5 137.5 197.5 0.2 0.4 1.3 1.3 2.5 12.4 38.5 85.1 92.6 89.2 91.1 79.1 58.9 43.3 41.7 44.9 56.8 82.2 71.5 73.3 84.0 90.7 118.8 76.9 51.9 44.9 96.8 107.9 116.6 112.4 111.0 143.2 60.7 77.8 98.5 116.9 167.2 164.1 172.3 174.2 77.6 66.6 144.2 167.5 171.8 148.7 III. 6 160.6 15.0 19.4 16.2 16.0 16.0 33.6 34.1 15.7 16.8 16.0 16.4 14.0 14.0 15.1 16.8 17.5 53.6 64.8 65.2 60.4 65.2 131.8 123.3 79.3 64.6 76.8 69.1 63.9 58.9 45.8 33.9 36.5 Source: NPA Rubber Division. IX-6 As GB-S and Butyl became available in large quantities there was a progressive decline in the use of natural rubber in tires, tubes, and camelback from 99 percent in 1942, to 66 percent in 1943, and on down to only 12.3 percent in the second half of 1945 (the low point). Thereafter, as natural rubber supplies made it possible, its percentage use was increased rapidly in transport goods until it approached 60 percent, remaining near that level until 1951. In transport goods the ratio of re- claim to new rubber, since 1942 and 1943, has been comparable to its prewar ratio. The curbs on use of natural rubber were more drastic for non-transport products than for transport products during the war; synthetics replaced natural rubber ear- lier and more completely. After the war authorities allocated natural rubber both to transport and non-transport goods until September 1947, when manufacturers of the latter were granted free choice of materials (with the minor exception of natural latex for seat cushioning until May 1948). Since the start of 1948, despite this free choice a slightly lower percentage of natural has been used in nontransport than in transport products. Experience in the latter part of 1951, when the price of natural rubber was still sufficiently higher than that of synthetic to call for its use wherever feasi- ble, and supplies of most synthetics were ample, indicates that a full range of ade- quate civilian products, plus those military products needed to support the Korean effort, calls for at least 35 per cent natural rubber. While the record shows that it was possible to get along with only 12.3 percent natural rubber in transport goods and only 7.4 percent in nontransport goods during a half-year period in 1945 during a dire shortage of natural rubber, the consensu? is that these limits did not result in ample products of adequate quality. Essential civilian and military products of adequate quality in a future emergency would require at least 15 per- cent natural rubber. The ratio of reclaim to new rubber in nontransport goods before the war aver- aged over 60 percent. Peak percentage use of reclaim occurred in 1942. Thereafter a decline in the ratio occurred each year through 1949, and the ratio in 1949 and 1950 averaged only 35 percent. The market for reclaim in nontransport goods has been permanently reduced, it appears, by the development and use of synthetics. During the period 1944-46, when peak percentage use of synthetics occurred, records of consumption of rubber by types, divided by chief transportation products, were compiled by the Office of the Bubber Director and successor agencies. Table IX, B(5) shows summary statistics from these records. Pneumatic casings used relatively little new rubber other than GB-S and natural, the latter chiefly in truck and bus tires. Inner tubes used Butyl to the extent of available supplies, GB-S (at first) and natural rubber (later) for remaining tube requirements. Camelback was made from GB-S with only small quantities of natural rubber. The item "other transportation" in this table covers casings and tubes for air- plane, bicycle, and industrial pneumatics; military bogie rollers, tank blocks, treads, and tracks; solid tires; airbags for curing tires; and tire and tube repair materials other than camelback, the details concerning which would probably not be very significant in a new emergency in view of the advances in technology of syn- thetic rubber types and application. Statistics on the consumption of reclaim in individual products were not compiled except for 1944 as shown in the footnote. The Neoprene and N-Type rubbers were mostly used in non-transportation products, con- cerning individual items of which no detail was compiled. Table IX, B(6) shows, for 1947-50, the consumption of rubber in transport com- pared with nontransport products in somewhat greater detail by types of rubber than in previous tables. The natural rubber latex has been mostly used in non-transport goods, and the synthetic latices likewise find their applications in that field al- though separate statistics on their consumption are not compiled. By far the chief product of latex is foamed latex cushion material for seat cushions, upholstery, mat- tresses and pillows, but there is also a large use in dipped rubber sundries and toys, in adhesives and cements, in paper products, and in paints. Consumption of latices has increased rapidly during recent years, and the fact that latex products contain practically no reclaimed rubber is a very important factor in the decline in percent- age use of reclaim in nontransport products as a whole. Note that the use of Neo- prene and N-Type rubbers in transport goods, and use of Butyl in nontransport goods have been unimportant. IX- 7 Table IX, B(5).— ESTIMATED HEW RUBBER CONSUMED IN TIRES AND OTHER PRODUCTS, 1944-46 [long tons]] Item and year Natural GR-S and other Natural Butyl GR-S and other Casings Inner tubes Passenger car: 1944 1945...... 1946... Truck and bus: 1944 1945 1946 Tractor and implement: 1944 1945..... 1946 In camel back and for other transportatton: 1 944 1945 1 946 , 1,677 1,876 34,811 75,202 62,321 152,287 769 433 3,023 83,751 123,525 266,119 147,856 194,385 112,057 15,294 21,016 39,471 174 226 276 4,484 167 19,376 27 23 359 150 3,056 50,736 8,003 31,967 14,260 2,325 8,359 11,575 18,665 1,036 15,346 921 3,630 3,631 171 Camel back Other transportation 4,550 4,073 4,141 71,150 72,135 41,604 24,532 17,853 8,526 3,819 5,045 22,894 27,936 10,014 Item and year Natural GR-S Neoprene N-Types Butyl In other products: 1944 1945 1946.... 32,698 18,457 54,797 124,244 138,775 162,583 46,055 41,550 43,429 14,112 8,029 5,988 2,610 1,845 826 Note: The estimates of reclaimed rubber consumed in 1944 are as follows, in long tons: Casings- passenger car, 14,257; truck and bus, 18,445; tractor and implement, 10,966; inner tubes— 552; Camel back— 26,528; other transportation— 4,724; and all other— 174,208. Source: Compiled from records of Statistical Section of Rubber Division, CPA. Separate statistics have been compiled on the consumption of rubber in insula- ted wires and cables, and are included in this table; note that about a third of the total Neoprene consumption is in this field, where its superior properties more than offset its high cost compared with other rubbers in the period. Manufacturers in the United States were asked to estimate, in advance for the third quarter of 1951, their consumption of each type of rubber byproducts. The tabulation of these statistics yields the most comprehensive information that has ever been available on this subject. The tabulations cover 31 classes of transpor- tation products and 29 classes of non-transportation items. These statistics are advance estimates, not actual consumption, and represent the consumption in a single quarter of controlled consumption, not a period of free choice of materials; despite these conditions they reflect trade practice in the consumption of natural rubber (dry and latex separately) and each of the synthetic rubbers to a considerable ex- tent. Table IX, B(8) shows for each product class the consumption of each type of new rubber as a percent of the total proposed new rubber consumption for that class. Table IX, B(9) shows for each type of new rubber, the distribution of consumption in each product class as a percent of the total consumption of that type of rubber. Table IX, B(10) provides information on the proposed consumption of reclaimed rubber in comparison with the total consumption of new rubber, for each class of products. IX— 8 Table IX, B(6).— U. S. CONSUMPTION OF RUBBER BY TYPES IN TRANSPORT AND NONTRANSPORT, 1947-50 Qn long tons^ Natural rubber Synthetic rubber Total new rubber Year Dry Latex Total GR-S Other S-Type Butyl Neo- prene N-Type Total Reclaimed rubber Transportation 1947.. 1948.. 1949.. 1950.. 441 ,048 439,996 380,525 475,027 1,684 3,010 2,066 2,439 442,742 443,006 382,591 477,466 319,817 243,400 225,047 275,141 67,505 57,531 50,534 63,159 527 589 1,134 2,119 2 55 227 334 387,851 301 ,575 276,942 340,753 830,593 744,581 659,533 818,219 116,581 112,408 1 1 1 ,038 143,180 Nont ransportat i on 1947.. 1948.. 1949.. 1950.. 107,694 158,847 157,880 189,103 12,225 25,479 34,051 53,699 119,919 184,326 191,931 242,802 126,499 90,833 74,373 113,286 2,273 11,080 21,717 27,803 1,333 1,339 2,130 3,189 37,176 31,529 30,619 41 ,662 4,534 5,716 8,600 11,596 171,815 140,497 137,439 197,536 291 ,734 324,823 329,370 440,338 171,814 148,705 111,641 160,553 Insulated wire and cable 1 1947.. 1948.. 1949.. 5,726 8,361 6,519 7,944 17,138 14,223 11,459 14,627 ( 2 ) <5 8 10,001 10,910 12,126 14,296 182 310 508 572 27,321 25,443 24,093 29,495 33,047 33,804 30,612 37,439 3,553 2,530 1,445 2,179 1 Included above under nontransportation. Source: NPA Rubber Division. 2 Included with GR-S. 3 Included with N-Type. Table IX, B(7).— ANNUAL REQUIREMENT OF MAJOR NON-RUBBER MATERIALS USED IN U. S. RUBBER MANUFACTURING INDUSTRY 1 Item No. Item and unit of measure Requ i re- men ts Chief use 7 8 9 10 II 12 b t©C lot* S9ICIS5S Copper.......... Aluminum... . .«•■ Nylon tire cord. .......... ..short tons. thousand pounds. « • 9 Gcsaovees m e a i s w QO • • « 999II9)lt999IMISS QO* ■ • High tenacity rayon tire cord... ..do.. Cotton tire cord. ..... ,do. (a) (b) (c) (d) (e) (f) (g) (h) Sul f u r. short tons. Carbon blacks.. ..thousand pounds. PI as t i c i zer s. do. . . Accelerators.... do... Ant i -oxidants. do... Major basic chemicals: " Anil ine ..do... Bet a-naph thol .... ...... do. • • Carbon Bisulfide.... ......do... Diethyl am ine. ......do... D i me thy 1 am i ne. do. . . Di phenyl am ine. do... Phenol ....................do. .. Sulfur for accelerators... short tons. 126,000 15,171 37,646 18,367 2 504,294 3 120,366 81,275 I ,241 ,546 214,099 35,683 35,683 60,015 12,650 29,027 2,971 4,675 13,452 1,887 5 5,056 Bead wire in tires. Tube valves. Fuel cells and mechanical rubber goods. Airplane tires. Truck & bus, passenger & motorcycle, and tractor- implement tires. Where rayon cord is short, and for industrial pneumatic tires. Rubber vulcanization largely. To provide greater mileage in tire treads. Used as softeners in rubber masterbatch mixes. To decrease curing time during vulcanization. To cut down aging in cured stocks. Used to manufacture accelerators and anti- oxidants. Do. 00. Do. Do. Do. Do. Do. 1 Based on annual rubber consumption of 1 ,593,000 long tons (462,000 natural, 812,000 synthetics, 319,000 reclaim). 2 Based on full rayon cord use in the output of 20,408,514 truck tires, 71,000,000 passenger and motorcycle tires, and 4,890,000 tractor- implement tires; and includes 33,792,000 pounds of rayon cord for non-transportation uses. 3 Assumes a rayon cord shortage of 89,294,000 lbs. converted to cotton cord at 1.3 lbs. cotton for each pound rayon; and includes the output of 1,260,000 industrial pneumatic tires in cotton cord. The rayon shortage is based on an estimated annual availability of 415 million pounds. 4 The quantities shown for the eight major basic chemicals herein listed, plus many other chemicals less sus- ceptible to shortage or of subsidiary importance, normally would result in the end-product requirement figures specified for accelerators and anit-oxidants (items 10 and II). 5 Also included in item 7 (Sulfur) so as to show total sulfur requirement. IX- 9 Table IX, B(8).— TYPE OF RUBBER AS PERCENT OF TOTAL PROPOSED NEW RUBBER CONSUMPTION IN EACH PRODUCT, 3rd QUARTER 1951 (ESTIMATED) Item No. Product Product code No. Dry Natural Natural Latex GR-S GR-I (Butyl) Neo- prene All other TRANSPORTATION PRODUCTS (PERCENT) I 2 3 1 5 6 7 8 9 10 II 12 13 It 15 16 17 18 19 20 21 22 23 21 25 26 27 28 29 30 31 32 33 9 10 II 12 13 II Tires: Airplane (large) Ai rplane (small ) Bi cycl e Motorcycle Passenger thru (6.50) & (7.10) Passenger over (6.50) 4 (7.10).... Industrial pneumatic Tractor implements (large} Tractor implements (small) Truck (7.50) and under Truck (8.25) thru (9,00) Truck (10.00) thru (12.00) Truck over (12.00) Sol i ds— ai rpl ane Sol ids— bogies, idlers and support rol lers Solids — pressed and cured on Tubes: Airplane Bicycle Industrial Passenger and motorcycle Tractor implements Truck (8.25) and under Truck (9.00) thru 13.00) Truck (11.00) and over Val ves Cu r i n g bags Tire flaps Camel back Other retread materials Tire and tube repair materials Tank blocks, treads and band tracks Total proposed consumption (items 1-31) Master batches or compounds made for and/or sold to others Total proposed consumption 96.1 98.2 11.2 20.1 16.1 21.1 20.0 13.3 12.1 33.1 65.7 82.3 91.2 70.2 1.9 17.8 99.8 1.7 1.0 (*) 18.3 31.7 1.9 11.1 31.3 1.9 .8 85.8 79.5 83.3 75.7 79.9 86.7 87.8 66.7 31.1 17.5 8.6 95.1 13.2 2.9 *) 79.6 89.7 8.6 12.1 81.5 56.0 33.8 8 55.8 100 87 97 100 99 97 21 86 12 8.9 29.8 (*) 9.0 2.6 (*) II. .2 (*) .3 (*) .1 n n NON-TRANSPORTATION PRODUCTS (PERCENT) Belts and belting Hose Pack i ng and gaskets Ai re raft equ ipment Automotive equipment (include auto- motive mats) Household and appliance products Mats and matting (exclude automo- tive mats) Hard rubber products (including auto battery containers) Other miscellaneous mechanical goods Wire and cable Rubber footwear Heels and soles Inner shoe cushions and pads Cements for shoes and shoe welding.. Less than .05%. 9 10 II 12a 12b I2f I2n I2P 12 13 II 15a I5d I5g, h 52.2 19.1 16.5 10.8 27.7 36.7 12.1 19.0 35.3 7.9 68.9 11.9 3.0 17.1 .1 3.8 1.8 .2 .7 3.3 .9 1.1 17.9 35.2 (*) 11.9 .6 10.2 1.3 33.3 6.1 53.5 .9 15.1 10.2 8.7 .1 33.7 16.5 61.0 .9 5.9 1.1 51.8 1.1 1.1 2.7 70.1 (*) 11.7 2.5 78.5 (*) .2 .5 38.9 2.0 11.7 8.9 18.7 2.1 39.7 .6 27.3 (*) .5 82.5 1.1 .6 80.6 .1 11.7 .2 5.6 .3 26.2 2.6 IX- 10 Table IX, B(8)»— TYPE OF RUBBER AS PERCENT OF TOTAL PROPOSED NEW RUBBER CONSUMPTION IN EACH PRODUCT, 3rd QUARTER 1951 (ESTIMATED)— Continued Item No Product Product code No. Dry Natural Natural Latex GR-S GR-I (Butyl) Nec- prene All other Total "new RHC NON-TRANSPORTAT ION PR ODUCTS (PERC E N T )- -Conti nued 15 I5b,c,e,f, i,j,k,1 16 15.4 14.1 8.4 18.4 61.4 28.8 7.2 9.4 24.3 5.4 7.2 100.0 Ifi 100.0 17 Proofing, combining or coating of fabrics 17 18 19, 20 17.0 49.8 15.8 1.8 29.0 26.0 55.2 10.0 .7 6.1 .1 12.2 10. 1 57.5 7.7 1-0 (-) 100.0 18 100.0 19 Floatation and life saving equipment 100.0 20 Bullet sealing fuel cells 21 22a 48.5 52.0 1.3 12.3 33.1 (*) 8.1 2.2 5.4 37.0 .1 100.0 21 100.0 22 Toys and balloons 22b, k 26.2 48.8 20.1 4.8 .1 100.0 23 Sponge rubber products & rubberized 22c, m 35.0 6.1 52.9 (*) 6.0 ('-) 100.0 24 22 f 59.2 .5 26.5 .2 .3 13.3 100.0 25 22h 71.5 27.4 .... I.I 100.0 26 Rubber flooring and floor covering.. 22 L .1 2.3 94.7 .5 2.4 100.0 27 22 39.0 .8 48.7 .6 2.8 8.1 100.0 28 Latex foam 23 .8 72.0 27.2 (*) 100.0 29 All other rubber products 24 45.9 4.2 24.4 2.0 9.7 13.8 100.0 30 Total proposed consumption 25.7 11.0 47.8 1.0 II. 1 3.4 100.0 *Less than .05f«. Source: Summary of Forms NPAF-58 and NPAF-59. Table IX, B(9).— TYPE OF RUBBER PROPOSED TO BE CONSUMED IN EACH PRODUCT AS PERCENT OF TOTAL PROPOSED CONSUMPTION OF THAT TYPE, 3rd QUARTER 1951 (ESTIMATED) Item No. Product Product code No. Dry Natural Natural Latex GR-S GR-I (Butyl) Neo- prene All other Total "new RHC TRANSPORTATION F ROD U C T S ( P E R C E N T ) 1.0 .1 .1 .1 (*) (*) (*) .2 (•) (*) (*) 8.9 2.4 27.2 ..... 5.0 .1 .3 9.4 .2 4 1.0 (?) 3.8 .3 n 1.4 • . • . . 6.8 .3 8.2 ..... 15.3 .3 4.7 ..... ..... 21.9 .4 2.8 ..... 7 J .1 .4 • ■ ■ ■ • . ■ • • ■ 2 (*) .... (*) 2 .1 I.I (*) 2 5 .2 .8 (*) 3 2 (*) 3 ..... . ... 1.7 3 (*) .6 3 3 48.4 3 ..... . ... 9.5 3 (*) 14.3 3 1 ... 16.8 3 4 ... .5 17 18 19 20 21 22 23 24 Tires: Airplane (large) Ai rplane (smal 1 ) Bicycle Moto rcy cl e. , Passenger thru (6.50) & (7.10) Passenger over (6.50) 4 (7.10) Industrial pneumatic Tractor implements (large) Tractor implements (small) Truck (7.50) and under Truck (8.25) thru (9.00) Truck (10.00) thru (12.00) Truck over (12.00) Sol ids— ai rplane, Solids — bogies, idlers and support rol lers Solids — pressed and cured on Tubes: A i rpl ane Bi cycl e. Industri al Passenger and motorcycle Tractor i mp 1 emen ts Truck (8.25) and under Truck (9.00) thru (13.00) Truck (14.00) and over : '- Less than .05%. (*) (*) 17. 6. .1 .4 .7 .1 2.3 .8 6.5 7.4 8.4 2.5 (*) .6 .3 .1 .1 (*) 3.2 .6 .9 I.I .2 IX- 11 Table IX, B(9).— TYPE OF RUBBER PROPOSED TO BE CONSUMED IN EACH PRODUCT AS PERCENT OF TOTAL PROPOSED CONSUMPTION OF THAT TYPE, 3rd QUARTER 1951 (ESTIMATED)— Continued Item Product Dry Natural GR-I Neo- All Total No. Product code No. Natural Latex GR-S (Butyl) prene other "new RHC" TRANSPORTATION PRODUCTS (PERCENT )— Continued 25 4 (*) .6 (*) (*) .8 (*) .1 (*) I 26 4 2.3 .3 27 Ti re f 1 aps 5 6 6 7 .5 1.6 .8 .6 1.2 8.1 .1 .1 .3 (*) .2 (*) .8 28 Camel back 5.0 29 Other retread materials .3 30 Tire and tube repair materials .2 31 Tank blocks, treads and band Total proposed consumption 8 .6 1.5 (*) .2 1.0 71.0 H.I 70.9 95.2 I.I .3 67.3 32 Master batches or compounds made for and/or sold to others .1 9.8 .6 3.4 2.6 .9 Total proposed consumption 33 74.1 13.9 71.5 95.2 4.5 2.9 68.2 NON-TRANSPORTATION PRO DUCTS ( P E R C E NT) 1 9 2.1 (*) .9 (*) 4.2 .7 1.3 2 Hose 10 1.2 1.5 .4 17.5 10.7 1.9 3 II .7 1.3 1.4 .2 5.7 12.9 1.4 4 12a .2 (*) (*) (*) 1.6 2.6 .2 5 Automotive equipment (include auto- motive mats) 12b 2.3 (*) 3.1 .4 4.2 3.4 2.7 6 Household and appliance products.... I2f I.I 1.0 .2 1.2 2.4 1.0 7 Mats and matting (exclude automotive I2n .1 .3 (*) .8 .4 .2 8 Hard rubber products (including auto battery containers) I2P .6 .4 1.5 (*) .1 .4 1.0 9 Other miscellaneous mechanical goods 12 2.5 .1 1.6 .7 8.8 17.7 2.2 10 Wire and cable 13 .7 .5 2.4 1.0 28.8 1.6 2.7 II m 4.0 1.5 1.0 (*) .3 1.9 12 Heels and soles 15a I5d 1.3 (*) .8 .3 5.1 .4 (*) 3.7 .8 1.8 (*) 3.4 13 Inner shoe cushions and pads .2 14 Cements for shoes and shoe welding.. I5g,h .2 3.5 (*) (*) 2.1 .7 .3 15 Other shoe products I5b,c,e,f, i,j,k,l 16 .1 .5 .3 .6 I.I .2 16 .2 1.9 .2 .5 2.8 2.7 .4 17 Proofing, combining or coating of fabr ics 17 18 19,20 .5 1.1 (*) .4 6.3 .1 1.0 .2 (*) .9 3.2 2.4 .3 6.7 .8 (*) 1.0 18 Drug sundries .9 19 Floatation and life saving equipment (*) 20 21 .4 (*) (*) .2 8.6 .3 21 22a .2 (*) .1 .2 .2 (*) .1 22 Toys and balloons 22b, k .3 1.1 .1 .4 (*) .3 23 Sponge rubber products & rubberized 22c, m 1.9 2.7 1.8 (*, 2.8 (*) 1.8 24 Pressure sensitive tape 22 f 1.0 .1 .3 (*) (*) 6.2 .5 25 Thread and related products 22h 22L 1.0 (*) 3.0 .6 1.8 .1 .2 2.2 .4 26 Rubber flooring and floor covering.. 1.0 27 Other miscellaneous products 22 .6 .1 .5 .1 .4 3.6 .5 28 23 .1 57.1 1.6 (*) 3.2 29 24 1.2 .8 .4 .2 2.1 9.9 .8 30 25.9 86.1 28.5 4.8 95.5 97.1 31.8 *Less than .05%. Source: Summary of Forms NPAF-58 and NPAF-59. IX- 12 Table IX, B( 10). —COMPARISON OF 3RD QUARTER 1951 REQUIREMENTS OF NEW RHC AND RECLAIM AS REPORTED ON NPAF-58 FOR TRANSPORTATION PRODUCTS Product description Product Code No. Total new RHC (lbs.) Total reclaim (lbs.) Reclaim Percent to total new RHC Average unit weight (lbs,) Tires: Airplane (large) Airplane (small ) B i cy cl e Motorcycl e Passenger thru (6.50) & (7.10) Passenger over (6.50) 4 (7.10) Indust ri al pneumat i c Tractor implements (large) 9 »,,» aa Tractor implements (small) Truck (7.50) and under Truck (8.25) thru (9.00) Truck (10.00) thru (12.00) Truck over (12.00) Sol ids — Airplane Solids — bogies, idlers and support rollers Sol ids— pressed and cured on Tubes: Ai rpl ane B i cycl e Industrial Passenger and motorcycle Tractor impl ements Truck (8.25) and under Truck (9.00) thru (13.00) Truck (14.00) and over Val ves. Curing bags •• . • Ti re fl aps. Camel back (pounds) Other retread materials (pounds) Tire and tube repair matls. (pounds) Tank blocks, treads and band tracks (pounds) Master batches or compounds made for and/or sold to others (pounds) Total proposed consumption (items 1-32) Consumption (un-al located) Total proposed consumption Product description 2,133,794 173,596 1,116,486 92,389 108,708,669 43,087,985 866,940 11,733,611 4,312,430 45,460,788 48,526,709 55,161,264 14,966,096 5,329 4,148,239 2,459,498 390,084 870,484 163,006 19,389,372 2,544,283 6,348,443 7,274,812 877,833 477,854 1,891,190 4,625,551 33,859,449 2,323,588 1,781,949 4,168,044 7,281,646 11,124 2,991 1,730,814 25,924 46,800,978 12,793,234 249, 448 5,522,950 3,438,939 6,097,197 1,739,088 1,287,503 82,660 .52 1.72 155.02 28.06 43.05 29.69 28,77 47.07 79.74 13.41 3.58 2.33 .55 .26 .10 .66 2.14 3.97 3.49 .98 18.76 4.89 2.92 1.47 1.48 .98 692,436 28.15 1.36 298,308 26,084 2,240,018 289,672 701,129 921,227 23,590 34.27 16.00 11.55 11.39 11.04 12.66 2.69 .12 .10 .17 .32 .32 .74 .54 16,040 888,599 6,973,252 46,091 523,118 .85 19.21 20.59 1.98 29.36 *.28 *.7I ** 10.07 **.90 **I3.II 684,989 9.41 437,221,411 115,106,622 94,107,403 18,081,634 21.52 15.71 552,328,033 112,189,037 20.31 See Belts and belting Hose Packing and gaskets Ai rcraf t equ i pment Automotive eqpt. (incl. automotive mats) Household and appliance products Mats and matting (excl. automotive mats) Hard rubber products (incl. auto battery containers) Other miscellaneous mechanical goods... Wire and cable Rubber footwear Heel s and sol es Inner shoe cushions and pads Cements for shoes and shoe welding footnotes at end of table. Product Code No. 9 10 II 12a 12b I2f I2n I2P 12 13 14 15a I5d I5g, h Total new RHC (pounds) 10,348,941 15,247,918 10,822,548 1,417,950 20,336,376 7,426,981 1,568,073 7,728,883 16,829,321 21,783,595 15,020,675 27,129,207 1,960,031 2,390,164 Total reclaim (pounds) 4,264,882 16,120,711 2,636,153 37,337 25,067,500 2,909,289 3,886,497 13,121,392 11,208,392 1,418,279 1,773,258 11,822,219 350,300 2,000 Percent reclaim to total new RHC 41.21 105.72 24.36 2.63 123.26 39.17 247.85 169.77 66.60 6.51 11.81 43.58 17.87 .08 247921 0—53- IX- 13 Table IX, B( 10).— COMPARISON OF 3RD QUARTER 1951 REQUIREMENTS OF NEW RHC AND RECLAIM AS REPORTED ON NPAF-58 FOR TRANSPORTATION PRODUCTS— Cont i nued Item no. Product description Product Code No-, Total new RHC (pounds) Total reclaim (pounds) Percent reclaim to total new RHC 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 Other shoe products. 15b, Cements Proofing, combining or coating of fabrics Drug sundries Flotation and life saving eqpt Bullet sealing fuel cells Athletic goods Toys and balloons Sponge rubber prods 8 & rubberized fiber & hair cu sh i on Pressure sensitive tape Thread and related products Rubber flooring 4 floor covering Other miscellaneous products Latex foam All other rubber products c,e,f, ,j,k,l 16 17 18 19,20 21 22a 22b, k 22c, m 22 f 22h 22L 22 23 24 1,767,590 3,428,964 7,891,905 7,054,321 153,689 1,817,200 1,068,757 2,759,057 14,262,634 4,186,740 3,109,797 8,446,630 4,004,770 20,923,226 6,474,186 56,300 3,510,776 1,286,220 90,999 237,800 172,723 889,184 I ,964,704 305,856 901,220 210,590 3.19 102.39 16.30 1.29 13.09 16.16 32.23 13.78 7.31 10.67 5.26 3,574,852 55.22 Total proposed consumption (items 1-29). Consumption (un-al located) Total proposed consumption 247,360,129 9,820,780 107,819,433 4,442,050 43.59 45.23 257,180,909 12,261,483 43.65 * Excludes one company that reported on rubber but not units. * * Pe rcen t of to ta 1 we i gh t. (d) Rubber Industry Requirements for Chief Non-Rubber Materials The rubber manufacturing industry is a large user of non-rubber materials. The art of rubber manufacture is based primarily on rubber and compounding ingredients, and secondarily on textiles which are required for the production of a number of the more important products, such as cords for tire carcasses, duck for belting and hose, footwear cloth, and rubberized piece goods and clothing, with a large require- ment for metals for tire beads, tire valves, hose couplings and parts, footwear buckles and grommets, and insulated wire. An idea of the extent of use of representative materials is afforded by the data in table IX, B(7), compiled by the Priorities, Industrial Expansion and Compo- nents Branch of the Rubber Division, NPA, for materials under their jurisdication. This table represents estimated requirements of various materials in a year when new rubber consumption is 1,274,000 long tons (of which 462,000 is natural rubber, dry and latex, and the remaining 812,000 consists of synthetic rubbers) and reclaimed rubber consumption is 319,000 long tons. The estimates assume a production of 20,400,000 truck and bus tires, 71,000,000 passenger and motorcycle tires, and 4,900,000 tractor and implement tires. Approximations of requirements at varying rates of consumption would change with the types of rubber used and with the rela- tive production of the various products of the industry. In this particular calcu- lation, it is assumed that 66 percent of the rubber consumption is in transportation products and 34 percent in non-transportation items. The estimates for certain basic chemicals required for the production of ingredients used in rubber manufac- ture, included in items 12(a) through 12(h) is in large part an amplification of the quantities shown under items 10 and 11. The cotton estimate is for the approximate tire requirements during the current year; because of lack of reasonably accurate data no estimate has been made for the cotton requirements for non-transport goods. The table indicates the principal uses in the rubber industry for each material listed, but there is a considerable use of additional and other components and ma- terials not included in the tabulation. IX- 14 C. FOREIGN COUNTRIES In addition to the estimates in table IX, A(l) of total consumption of natural and synthetic rubber outside the United States, the relative importance of consump- tion in individual important countries is of interest. For most countries consump- tion is not reported, and we are dependent on estimates derived from their imports of natural rubber [table VII, A(l)]. Table IX, C(l) contains such consumption sta- tistics as are reported, and aggregate estimates for other areas, covering both natural and synthetic rubber. Table IX, C( I ). — ESTIMATED FOREIGN CONSUMPTION OF NEW (NATURAL AND SYNTHETIC) RUBBER, 1946-50 [in I ,000 long tonsj Country 1946 1947 1948 1949 1950 France 126.8 58.5 13.5 4.3 9.5 59.2 20.0 39.2 14.0 16.1 20.0 12.1 43.0 156.4 73.7 15.9 8.2 35.0 109.7 23.1 61.5 17.0 14.2 17.1 22.2 58.7 196.3 93.9 50.0 13.0 100.0 133.1 26.5 62. 1 19.7 15.7 26.6 21 .0 75.2 186.6 99.5 68.2 12.1 105.0 2 161 .7 27.9 56.4 19.7 19.0 34.2 27.5 80.8 222.4 107.3 Germany Russ ia 1 82.0 14.6 82.5 Other Europe 3 162.1 Austral i a 34.4 Canada 68.7 India ; 17.7 Brazi 1 22.5 Japan 62.6 China * 70.0 Other countries 79.6 Grand total 436.2 612.7 833.1 898.6 1,026.4 1 Imports of natural rubber only, estimated. 2 Including Italy 35.0, and Belgium II. 0. 3 Including Italy 40.0, and Belgium II. 0. Source: Statistical Bulletin, International Rubber Study Group; and Rubber Division, NPA. The United Kingdom is the leading foreign country for which statistics are re- ported, followed by France, Germany and Canada. Russia, Japan, China and Italy are other leading countries. The statistics for Russia and China shown in table IX, C(l) are their "estimated imports" of natural rubber; no domestically-produced rub- ber either synthetic or natural is included. China's imports increased sharply after the start of the Korean war in 1950. The Russian consumption of natural and synthetic rubber is unknown. An esti- mate of 300,000 tons a year (say 75,000 natural and 225,000 synthetic) would perhaps be a liberal guess of their current annual rate of new rubber consumption. Russia probably ranks first, ahead of the United Kingdom, among foreign rubber consuming countries. Note the large increase in Japan's consumption in 1950, partly due to Korean war orders supplied by manufacturers in Japan. Some information on the consumption of rubber by types and by products is re- ported for certain foreign countries (Canada, United Kingdom, France) but this in- formation in most cases would not be particularly significant for purposes of this study. In nearly all foreign countries except Russia and Canada, the consumption of synthetic rubber in the last few years has been very small. However, in the case of the United Kingdom, the consumption of natural and of synthetic rubber in certain nontransport products in 1945 and 1946, when fairly large amounts of synthetic rubber were being used there, may be of interest (since similar details were not compiled for the United States) as indicating the nontrans- port fields in which GR-S was then mainly used. Table IX, C(2) provides these de- tails. IX- 15 Table IX, C(2).— UNITED KINGDOM RUBBER CONSUMPTION IN NONTRANSPORT GOODS— 1945-46 [jn long tons] Goods Belting Cables Ebon i te Footwear (including repairs), Soles and heels Hose , Proofing Su rg i ca 1 s Th read Sponge , Bal 1 oons , Gas Masks Self-sealing tanks All other Total 1945 Natural 553 1,983 430 165 121 54 320 115 ( 2 ) 120 8 201 2,145 6,215 Synthetic 2,918 4,090 492 696 2,229 1,276 988 236 391 ( 2 ) 194 57 726 5,203 19,496 1946 Natural 4,730 6,941 954 4,393 925 1,103 526 1,294 489 ( 2 ) ( 2 ) ( 2 ) 10,984 Synthetic 32,339 1,219 3,052 390 2,789 716 467 43 23 14 ( 2 ) ( 2 ) ( 2 ) 3,954 12,667 1 Included in footwear. 2 Included in "all other." Source: Secretariat of the Rubber Study Group. The consumption of synthetic rubber in foreign countries, so far as data is available, is shown in table VII, B(l). The consumption of reclaimed rubber is reported for few foreign countries. In Germany and France, there is a much larger percentage use of reclaim than in the United Kingdom or in British Empire countries except Canada. The use of reclaim was always officially discouraged in the United Kingdom up to the start of World War II, the effort of course being to promote the use of natural rubber to the utmost, since it was so largely produced in British possessions. The available statistics on foreign consumption of reclaim are shown in table IX, C(3). Table IX, C(3).— CONSUMPTION OF RECLAIMED RUBBER IN CERTAIN COUNTRIES, 1945-50 Year United Kingdom Austral ia Canada Germany 1945 26,708 25,288 22,509 23,507 20,241 24,999 5,454 7,090 5,601 5,846 6,163 8,173 15,313 14,140 16,322 13,686 1 1,791 13,952 (') 1946 i 1 ) 1947 1948 1949 21,872 '1950.. 21,115 1 Not reported. Source: Secretariat, Rubber Study Group. IX- 16 Rubber Prices Rubber Prices A. NATURAL RUBBER In the everyday commercial lives of those associated with the rubber trade and the rubber manufacturing industry, the price of natural rubber has been a paramount consideration at all times. Historic events have assumed importance and are remem- bered in relation to their effects on rubber prices. Table X, A(l), which shows the annual high, low, and average prices of No. 1 Ribbed Smoked Sheets from 1920 through 1950, would serve as an outline of rubber history and personal biography to any in- dividual who has been connected with the rubber industry throughout the period. Variations from low to high in each year (except the 1942-46 period of govern- ment control of all sales at a fixed price) have been wide, averaging 128 percent in the 1920-29 decade, 102 percent in the 1930-39 decade, and 98 percent in the subse- quent years (omitting 1942-46). After the advent of our chemical rubber industry, the price variations in natural rubber were less extreme until 1950, averaging only 46 percent in 1947-49. The importance of the price of natural rubber in the lives of American citizens is waning. The table starts with the decline in price following the short boom after World War I, bringing prices to a low of 11 1/2 cents at the pit of the 1921 trade depres- sion, and setting the stage for the Stevenson (British) Restriction Scheme of Novem- ber 1922-October 1928. Under that scheme, prices were bid up at its introduction, then a lull occurred and prices declined although stocks were declining until mid 1924, then a shortage of rubber pushed prices in 1925 to the highest level ever quoted since plantation rubber became the chief source of supply. Increased use of reclaim, relaxation of the restriction on exports of rubber from Malaya and Ceylon, and increased produc- tion in the Netherlands Indies gradually corrected the shortage, but the pivot price under the scheme was in 1926 upped to 42 cents compared with 30 cents previously. The new pivot price supported by increased British restriction tended to hold the market level high, but further stimulated the output in non-British producing areas, causing serious decline in the British share of the world trade in rubber. The British endeavored to enlist the Dutch in the restriction scheme. That failing, they announced early in 1928 that the scheme would terminate at the end of October, and rubber quotations dropped promptly and sharply. Table X, A(l ). — NO. I RIBBED SMOKED SHEETS— SPOT CLOSING PRICES— I 920-50 [New York market — cents per pound] Year High Low Average Year High Low Average 1920. 1921. 1922. 1923. I 924. 1925. 1926. 1927. 1928. 1929. 1930. 1931. 1932. 1933. 1934. 1935. 56 1/2 21 3/4 28 3/8 37 1/8 40 1/8 121 88 1/2 41 3/4 11 1/4 26 7/8 16 1/2 8 5/8 4 3/4 9 7/8 15 7/8 13 3/4 16 II 1/2 13 5/8 24 3/4 17 5/8 34 3/8 36 3/4 33 17 15 1/2 7 1/2 4 1/4 2 1/2 2 7/8 8 3/4 10 1/2 36.30 16.36 17.50 29.45 26.20 72.46 48.50 37.72 22.48 20.55 11.98 6.17 3.49 5.96 12.92 12.37 193 6. 1937. 1938. 1939. 1940. 1941. 1942. 1943. 1944. 1945. 1946. 1947. 1948. 1949. 1950. 23 26 7/8 17 3/16 24 24 24 7/8 22 1/2 22 1/2 22 1/2 22 1/2 22 1/2 25 25 19 3/4 86 13 1/2 14 10 1/4 14 15/16 18 1/4 19 1/8 22 1/2 22 1/2 22 1/2 22 1/2 22 1/2 14 18 15 7/8 18 16.41 19.39 14.64 17.57 20.10 22.40 22.50 22.50 22.50 22.50 22.50 2Q.00 21.99 17.57 41.10 Source: Rubber Age. X-l During the world trade depression of 1929-33 the price declined steadily as ac- cumulating stocks clogged the markets, but conditions had passed their worst when, in 1933, the spadework was well underway on the International (British, Dutch, French, and all Far Eastern rubber-producing countries) Rubber Regulation Scheme in- troduced in June 1934. The price pattern for the next three years was much the same as in 1922-25 — a spurt, then a decline, then a peak in early 1937. The 1938 reces- sion in American business caused prices to decline and brought more severe curtail- ment of natural rubber production, which was reducing supplies and pushing prices upward at the start of World War II in 1939. Arrangements for U. S. Government stockpiling, and price agreements made with the British and the Rubber Regulation authorities in consequence, were controlling market factors during 1940 41. This was followed by the 1942-46 period of fixed prices. After the resumption of free trade in rubber April 1, 1947, the American industry did not have to pay high prices for natural rubber until the new rubber supply got out of balance with demand in 1950, partly because of under- estimates of demand by industry, partly (let it be admitted) because of Government overall mis- management of rubber affairs, and partly because of the war in Korea which was not foreseeable. In 1951, the price has receded to around 50 cents a pound. This price is still fantastically high in relation to 1947-49 prices, even making all proper allowance for inflation. A major readjustment must be made when our stockpiling terminates unless the flow of natural rubber supplies is greatly reduced by some cause. The GSA buying price, under current conditions, establishes the world price level for natural rubber. Any other buyer can secure desired tonnages by outbidding GSA a fraction of a cent per pound; any seller can depend on GSA to buy whatever he cannot sell elsewhere. This will remain true only so long as the United States con- tinues to buy all natural rubber offered; it must end when the stockpile goal has been achieved, if not sooner. Table X^ A(2) covers prices of crude rubber from 1900 to 1920. In the first years of this century, Para rubber (wild) from Brazil was the standard, and until 1910 records available show only the annual high and low prices for wild Para and for plantation smoked sheets from Ceylon. Thereafter, the average annual prices for plantation ribbed smoked sheets are a matter of record. Prices of rubber showed a strong rising trend from 1900 to 1910 when the all-time high quotations were recorded, thereafter to 1919 the price declined as increased supplies of plantation rubber more fully supplied world needs, despite the retarding effect of the first world war. In 1920, the start of the post-war trade depression brought a serious fall in the price of rubber, as it did in commodity prices generally, paving the way to the British (Stevenson) Restriction Scheme described elsewhere. Table X, A(2).— NEW YORK SPOT RUBBER PRICES 1900-1920 LCents per pound] Year Upriver Fine Para Plantation Ribbed Smoked Sheets Year Upriver Fine Para Plantation Ribbed Smoked Sheets Low High Low High Average Low High Low High Average 1900.... 1901.... 1 902 ... . I9C3.... 1904.... 1905.... 1906.... 1907.... 1908.... 1909.... 89 83 70 84 94 118 122 82 66 120 110 94 91 109 131 135 129 124 130 215 ( > 86 93 75 128 ( > ( x ) ( l ) 150 138 130 208 ( > ( > ( ) ( 2 ) ( 2 ) 1910.... 1911.... 1912.... 1913.... 1914.... 1915.... 191 6 1 917 1 91 8 — . 1919.... 1 920. . . . 136 92 102 71 63 55 62 54 56 47 18 292 168 123 110 1 15 87 99 80 70 61 50 141 114 108 59 56 58 1/2 55 52 40 38 1/2 16 288 184 140 113 93 79 102 90 70 57 56 1/2 206.60 141.30 121.60 82.04 65.33 65.85 72.50 72.23 60.15 48.70 36.30 1 Not regularly quoted. 2 Average not available. Source: "Marketing of Crude Rubber," Department of Commerce, 1927. X-2 Table X, A(3) shows monthly New York market prices for No. 1 Ribbed Smoked Sheets for recent years. Separate 1951 quotations show that selling prices of the General Services Administration have varied considerably from equivalent world prices which is of course quite abnormal. GSA has on hand a considerable tonnage of rubber below stockpile quality which has been bought on the high market prevailing since the start of the Korean war. Table X, A(4) gives the monthly declared value per pound of United States total imports of natural rubber. These values indicate the international exchange in- volved in our imports. The price of No. 1 Sheet used in the two preceding tables is the quotation generally used to show market variations; there is no record of com- posite average market price for all types of natural rubber; the composite price would be appreciably lower than No. 1 Sheet, since off-grades sell at varying dis- counts, and account for the bulk of the rubber. Table X, A (3).— MONTHLY AVERAGE— NEW YORK SPOT PRICE— NO. [Cents per pound] RIBBED SMOKED SHEET, 1947-51 Month 1947 1948 1949 1950 1951 195 1 1 I95I 2 Month 1947 1948 1949 1950 1 951 I95I 1 1951 2 January. . February March... April... May June. .. . July.... 24.7 25.8 25.8 24.4 21.0 16.3 15.5 21.8 20.4 20.3 23.0 23.4 22.8 24.2 19.2 18.5 19.1 18.5 17.9 16.3 16.5 18.4 19.4 19.9 23.7 28.4 30.8 40.2 71.2 73.6 71.8 67.3 54.3 50.7 48.6 66.9 66.0 66.0 66.0 66.0 66.0 52.0 August.... September October. .. November. . December. . 15.2 16.5 20.4 23.6 21.5 20.8 23.6 22.9 22.1 20.5 18.9 22.0 IG.6 17.6 16.3 16.7 17.6 17.6 51.6 56.1 62.6 73.1 7I.2 4I.2 .... 49.6 53.5 52.3 49.1 52.0 52.0 52.0 52.0 52.0 59.0 1 Singapore price, nearby rubber, c. i.f. New York. 2 G.S.A. sel 1 ing price. Source: Compiled from Commodity Exchange Daily Reports. Table X, A(4).— MONTHLY DECLARED VALUE OF UNITED STATES NATURAL RUBBER IMPORTS 1947-51, (DRY RUBBER, LATEX AND GUAYULE) LCents per pound] Month 1947 1948 1949 1950 1951 Month 1947 1948 1949 1950 1951 February.... March April 24.4 23.8 24.7 23.2 23.0 20.6 18.3 17.4 18.4 18.4 17.9 17.9 18.4 19.0 18.3 17.6 17.1 17.1 16.7 16.7 16.1 15.2 15.8 16.7 17.1 17.6 19.4 21.7 48.8 51.3 52.6 53.7 54.6 54.7 53.2 Year 16.8 14.4 14.5 15.8 16.1 20.0 18.6 19.7 20.3 20.1 19.3 18.8 15.5 14.8 15.0 14.9 14.9 16.2 25.0 30.0 33.8 41.6 46.0 25.5 48.1 43.4 42.7 Source: Calculated from official U. S. import statistics, Bureau of the Census. The import values, which cover all the types and grades, indicate that in ordi- nary years the difference would not be serious but in 1950 and 1951 the off-grades have been selling at far greater discount than normally. The trend of import values, representing a composite of contracts made mostly several months earlier, lags be- hind the trend of spot market prices. B. SYNTHETIC RUBBER The price of our synthetic rubber is not like that of natural rubber subject to the higgling of the market, but is determined by the Government. It is the well established policy of our Government that selling prices of Gov- ernment-produced synthetics shall cover their costs. This has included plant equip- ment amortization figured on a twelve-year life, which is understood to be compara- ble with the practice in chemical industries. X-3 The practice has also been to sell GR-S at a uniform price. The higher costs of production from alcohol-based butadiene are averaged with the lower costs from petroleum- based butadiene. Some copolymer plants produce more efficiently than others, but they are all averaged together. A large expense was entailed to convert copolymer plants to the production of cold rubber, but its selling price has been identical with that for the high temperature GR-S at any stated date. Incidentally, the Government applies a uniform charge for transportation costs, regardless of the destination, length of haul, etc. Table X, B(l) gives the history of selling prices charged for Government- produced GR-S, Butyl, and Neoprene up to the time the Neoprene plant was sold to du Pont. The dates of all price changes are listed. Table X, B(l).— U. S. GOVERNMENT SELLING PRICES FOR SYNTHETIC RUBBER, 1942-51 [Cents per pound! Chemical rubber Chemical rubber ■' Date Natural rubber Date Natural GR-S Butyl Neoprene GR-S Butyl Neoprene rubber 22 1/2 Jan. 13, 1947... 3 I8 1/2 3 I8 1/2 3 27 1/2 3 25 3/4 Oct. I, 1942.... 50 33 65 22 1/2 June 21, 1947... 18 1/2 (8 1/2 27 1/2 "23 April I, I943 1 .. 2 I8 1/2 2 I5 1/2 45 2 22 1/2 Aug. 1, 1947.... 18 1/2 18 1/2 5 32 23 July 10, 1943... 2 I8 1/2 2 I5 1/2 2 27 1/2 2 22 1/2 Dec. 7, I950 6 ... 24 1/2 20 3/4 Sept. 1, 1945... 18 1/2 15 1/2 27 1/2 22 1/2 Sept. 1, 1951... 26 20 3/4 March 1, 1946... 18 1/2 18 1/2 27 1/2 22 1/2 X A uniform freight charge of l/2tf per pound on carload lots, I $ per pound less carload, was made applicable. Before April I, 1943, sales were f.o.b. point of shipment. 2 In add it ion 17 l/2tf for rubber used in supplying military orders was paid by the Army 4 Navy, until Sept. 1, 1945. 3 On January 31, 1947, the freight charge was increased to 0.75£ carload and I. if less carload. ' The date for manufacturers who had already purchased their quotas. Effective July 1 6 for al 1 manufacturers. 5 This Neoprene price effective until December 31, 1949. 6 Uniform freight charge upped to \f carload and 1 .6tf less carload. Source: General Services Administration. It will be noted that there have been two price increases for GR-S since the start of the Korean war. Costs were increased by the expenses of rehabilitation of idle plants, the increased use of alcohol in the production of butadiene, the higher costs of production in the less-efficient stand-by plants, the conversion of GR-S plants to the production of cold rubber, the necessity of contracting for supplies of styrene in addition to the quantities for which rights were reserved when the styrene plants were disposed of to private industry, and by higher labor costs. If and when our production of GR-S again is supplied from petroleum-based buta- diene, and the much higher cost alcohol butadiene is eliminated, a reduction in the price of GR-S is to be expected. Butyl was priced lower than GR-S until March 1, 1946. From that date to Decem- ber 7, 1950, Butyl and GR-S prices were uniform; the 1946 increase in the selling price of Butyl, however, was made to offset certain non-Butyl costs, and was opposed at the time by members of the rubber industry. The cost of Butyl was not subject to the alcohol-butadiene factor, nor affected by the GR-S plant conversion to cold rub- ber, and the pattern of a uniform GR-S and Butyl price has apparently been abandoned. For the sake of completeness with respect to RFC rubber prices, their selling prices for No. 1 Sheet natural rubber are included in the table to August 1, 1947^ C. RECLAIMED RUBBER Reclaimed rubber prices have been increased since before the war chiefly be- cause of higher costs of scrap rubber due to rising costs of labor and transporta- tion. First grade whole tire reclaim at the start of the war was sellingat 6 cents a pound. The price crept up gradually to 8 cents for 1947, rose to 9 cents in June 1950, and to 10 1/2 cents in September 1950, where it remained during the first half of 1951. X-4 XI Organizational Facilities XI Organizational Facilities A. UNITED STATES GOVERNMENT Since the end of fighting in World War II, the United States Government has continued to concern itself in the rubber business of our country and of the world. Major policy has been influenced by the Baruch Committee 1942 Report and Recom- mendations on Rubber, by the 1946 Recommendations of the (Batt) Interagency Rubber Policy Committee, by the Strategic and Critical Materials Stockpiling Act (P. L. 520, 79th Congress), by the declaration of policy by Congress in the Rubber Act of 1948, and by the Steelman Report on Synthetic Rubber to the President and Congress in Jan- uary 1950. There have been several additional reports on special subjects by Inter- agency Task Groups. The objectives are, in brief, to maintain and support a nucleus domestic synthetic rubber producing industry, with the balance of the plants either operating to supply voluntary consumption requirements or, lacking these, kept in readiness for use in an emergency, to stockpile natural rubber necessary for use in any emergency when imports are cut off, but at the same time so to conduct our rub- ber affairs as to maintain and build goodwill among foreign nations interested in natural rubber production and minimize any harmful effects on natural rubber pro- ducers. Since the termination of the wartime Office of the Rubber Director, the executive authority and jurisdiction over rubber matters has rested with the White House. The production of Government synthetic rubber has continuously been under the jurisdiction of the Reconstruction Finance Corporation. The determination of the natural rubber stockpiling objective and of quantities to be purchased during spe- cific periods is a function of the Munitions Board. The control of domestic rubber consumption has in recent years been exercised by the Department of Commerce, cur- rently through the National Production Authority. The procurement of natural rubber for the stockpile, and during 1951 the jurisdiction over all imports of natural rub- ber, has been placed in the hands of the General Services Administration, in the Emergency Procurement Service. Any and all negotiations and conferences with repre- sentatives of foreign Governments on rubber matters are carried on under the aegis of the Department of State. The Department of Agriculture carries on experimental work in the domestic production of natural rubber, and furnishes technical assist- ance under the Cooperative Agreements with Latin American Governments interested in developing Hevea plantations. B. UNITED STATES INDUSTRY In relations with domestic industry, several of these agencies have the assist- ance of industry committees. The Munitions Board has both a Government Rubber Com- mittee and an Industry Rubber Committee, NPA^a Rubber Industry Advisory Committee, State, a Rubber Advisory Panel, etc. The industry committees of various agencies have several duplications in membership, but also numerous variations depending upon the particular field in which the group must be prepared to offer advice; a single industry committee to serve all agencies has not been deemed practical. The central organization of the manufacturers of rubber products is the Rubber Manufacturers Association, Incorporated. This association has headquarters at 444 Madison Avenue, New York 22, N. Y. , and a Washington branch office. The association is organized in divisions by classes of products, and its advice is usually sought on all rubber and rubber product problems. The rubber importers and dealers are organized in the Rubber Trade Association of New York, with headquarters at 15 William Street, New York 5, N. Y. , and a Wash- ington office. They render valuable assistance on matters relating to international trade in natural rubber and international relations in this field. Rubber reclaimers have their separate Rubber Reclaimers Association, Inc., with headquarters at 250 West 57th Street, New York 19, N. Y. The above are the principal organizations of the industry; the naming of less important groups would seldom be helpful. In matters relating to the prices and XI— 1 collection of scrap rubbe.r tires, etc., the National Association of Waste Material Dealers, Inc. , 271 Madison Avenue, New York 16, N. Y. , would be involved. In mat- ters relating to distribution of tires and automotive rubber goods, the National Association of Independent Tire Dealers, Inc., 631 Pennsylvania Avenue, N. W. , Wash- ington 4, D. C. , usually has suggestions to offer. C. FOREIGN COUNTRIES Outside the United States, in matters relating to rubber, the State Department operates through diplomatic channels with individual Governments, or through an ac- credited Delegate at annual Meetings of the International Rubber Study Group. The most important rubber industry organization abroad is the Rubber Growers Association, 19 Fenchurch Street, London, E. C. 3, England, whose members include most of the leading producers of estate rubber in Far Eastern countries. In prewar years, they were highly influential in British rubber policy, but since the war their influence has been less pronounced although still a matter of consideration. The Rubber Trade Association of London, in its activities and influence in England, roughly parallels the position of our Rubber Trade Association of New York. The production of synthetic rubber by the Canadian Government is carried on by Polymer Corporation, Ltd. , Sarnia, Ontario. They distribute in the United States through H. Muehlstein and Co., Inc., 60 East 42nd Street, New York 17, N. Y. , who happens also to be the leading dealer in scrap rubber in the United States. There are a few huge rubber manufacturing companies that need special mention. In our own country we have the Big Five — Firestone, General, Goodrich, Goodyear, and U. S. Rubber — whose activities as operators of copolymer GR-S plants and as manu- facturers of rubber products in numerous domestic factories involves them in every Government decision of moment. It is not always remembered that these American companies account not only for nearly two-thirds of the United States consumption of rubber, but also possibly half of the consumption of rubber outside the United States (except Russia) in their branch factories or affiliated companies. The British Dunlop Company, the French Michelin, and the Italian Pirelli are the most important foreign rubber manufac- turing companies. The extent of company concentration in the production of tires throughout the world is little realized. Outside the United States and iron curtain countries, most of the production is in the hands of a very few companies. In table XI, C( 1) ,p. 3 is shown the distribution of factories for ten companies, by countries. In the headings, American companies are listed alphabetically, followed by foreign com- panies. Countries are listed alphabetically under a geographical arrangement. While most of the factories specialize in tires, other rubber goods are also produced, while the U. S. Rubber Company factory in Cuba specializes in rubber-soled shoes. The location of all American plants of all rubber manufacturing companies is stated in the Rubber Red Book, mentioned in the Bibliography section. XI- 2 Tabl e XI, C( 1).— FACTORIES OF CHIEF COMPANIES, BY COUNTRIES Country Dayton Fire- stone Gener- al Good- rich Good- year Seiber- 1 ing Un i ted States Dunlop Mich- el in Pir- elli A (A) A A (A) A A A A A A A A A A A (A) AH A A A3 A3 A A3 A A A A A2 (A) A3 A3 A2 A2 A3 A A A (A) A A A A A A A A A A3 A A (A) A B A (A) Al A A3 A A AH A A A (A) A A A A A A A4 A (A) A A A A Al A Chile Peru Eire A Italy (A) A A A Tire factory. (A) Parent company. Al U.S. and Pirelli jointly. A2 Financial interest. A3 Technical agreement. A4- Planned. B Footwear. In some countries, Dunlop and Goodyear make tires for each other. XI-3 XII Government Controls and Experiences XII Government Controls and Experiences A. WORLD WAR II Because of the outstanding strategic importance of natural rubber to our coun- try before our development of synthetic rubber, representatives of the rubber indus- try were called into conference by our Government in many instances in the years between World Wars I and II. The controls over natural rubber production by foreign powers had necessitated cooperation between the U. S. rubber industry and our Gov- ernment in dealing with the problems that arose from time to time. As a result, an excellent liaison existed between the industry, and the Departments of State, Com- merce, and Justice, and after 1939 with the Munitions Board and the Reconstruction Finance Corporation in their rubber stockpiling activities. Usually negotiations with the industry involved officials of the Rubber Manufacturers Association, who enlisted the aid of representative industry personnel qualified to advise on the particular subject of discussion. With the conquest of France by Germany in June 1940, consideration was given both to increasing the production of natural rubber in the countries of the Western Hemisphere (conference called by the Secretary of Agriculture) and to the establish- ment of a domestic synthetic rubber production (conferences held by the Reconstruc- tion Finance Corporation which was already stockpiling natural rubber and was soon to assume jurisdiction over all imports of the commodity). About the same time, RMA officials were chosen to advise the President's National Defense Advisory Commission on rubber matters. Stimulation of domestic production of reclaimed rubber; Govern- ment licensing of exports of natural rubber, reclaimed rubber and scrap rubber; and domestic production of Guayule rubber were among other subjects considered, along with methods of conservation in the consumption of rubber. With the establishment of the Office of Production Management, a nucleus Rubber Branch of OPM was constituted, headed first by RMA personnel, and later by one Branch Chief after another as OPM was succeeded by the War Production Board. OPM efforts in early 1941 were in the direction of a voluntary control of rubber con- sumption, which was ineffective. The rubber industry was shown to be clearly inca- pable of self-regulation of rubber consumption under the semi -emergency conditions during the first half of 1941. On June 21, the Government took full control of the trade in crude rubber effective June 23, and announced federal regulation of rubber consumption starting July 1. The control over crude rubber consumption was the first imposed by the OPM Division of Priorities over a commodity in which a shortage did not exist at the time. Meanwhile, the restrictions on production of natural rubber in the Far East had been reduced by RFC-State Department arrangements with the British Government and the International Rubber Regulation Committee. American imports and stockpiling of rubber were accelerated, particularly in 1941, at the end of which the record amount of 534,000 tons of natural rubber was on hand in this country. The June 1941 control order made consumption of both natural and synthetic rubber subject to allocation, with a descending percentage of base period (year ended March 31) consumption allowable each month from July through December, and re- quired deliveries under Defense Orders in advance of other deliveries of rubber products. Sometime during the six months, there was drafted a detailed rubber con- trol order that would become effective if we entered the war. Synthetic rubber plant planning, while constantly under study, lagged until the Japanese attack on Pearl Harbor, and the situation then facing our country rubber- wise called for so much larger an undertaking than had previously been contemplated that several months were required to get the program agreed upon, and the construc- tion under way. The complexities and details of Government rubber activities, and the overlap- ping authorities, conflicts over materials, and lack of coordination among different agencies, was a matter of great difficulty in 1941 and 1942. A rubber Coordinator XII — 1 was appointed in early 1942 but without plenary directive power and was therefor in- effective. In August 1