steel industry. The principal additions to the Nation's steel-making capacity authorized in these projects were as follows: Coal Iron ore and concentrates_ Sintered concentrates Coke____ Pig iron__. Open hearth ingots---. Rolling mill products- Annual capacity (tons) 6, 646, 000 9, 766, 120 7,067, 400 7,828, 500 10, 003, 500 5, 200, 613 1,271, 240 5, 915, 217 In addition to those listed, facilities also were provided for the production of ferromanganese, tubing, malleable and gray iron castings, steel castings and forgings, etc. Approximately a billion dollars was expended by DPC in the erection of steel facilities. All of the DPC projects were under the sponsorship of some Government agency directly concerned with the prosecution of the war. For details on the facilities included, your attention is invited to reports of the war agencies, especially "Steel Expansion for War," prepared by W. A. Hauck, of the War Production Board's Steel Division. The postwar disposition of DPC's steel facilities has been noted in reports of the Surplus Property Board, the Surplus Property Administration, and War Assets Administration (now General Services Administration). From about the time of the war's close until June 9, 1950, the Reconstruction Finance Corporation authorized 17 loans for $75,040,000 to steel companies. In most instances, these loans were made for the purpose of assisting in the conversion of wartime facilities to civilian-type production. More than 80 percent of the loan funds authorized to steel concerns since January 1, 1945, have been designated for capital expenditures. While this Corporation has no restrictions placed on the size of concerns to which it may lend funds, you will note that only two loans were authorized to companies which might be considered as being among the major steel producers. Both of these loans were made under wartime directives to subsidiaries of Armco Steel Corp. (Sheffield Steel Corp. of Texas and Rustless Mining Corp.). As far as funds for future expansion of the industry are concerned, it would seem that the leading producers should have little difficulty in obtaining any outside capital they may require from private lenders or from the sale of securities. This may not hold true, however, for smaller companies, and if any future requests for loan funds are made to RFC by steel concerns, it is most likely that they will come from the smaller members of the industry whose prestige is insufficient to assure a public market for their securities, or whose immediate earning prospects may make it necessary for them to borrow funds for longer periods of time than private lenders are willing to commit. In a general sense, all loans made by RFC to business enterprises result in the strengthening or preserving of the borrowers' financial and competitive positions. I trust that this letter, together with the tables submitted, will supply you with the information you desired and will prove helpful to your committee. With kind regards. Sincerely, HARLEY HISE, Chairman. TABLE III.-Detail of loan authorizations to companies in the iron and steel industry, July 1, 1940, to Dec. 31, 1944 Name and address of company Products Amount Eastern Stainless Steel Corp., Stainless-steel sheets. $1,500,000 September 1944.. ingots, hot-rolled 26,050,000 700,000 48,700,000 8, 619, 000 Kaiser Co., Inc., Oakland, Calif. Coke, coal chemicals, pig iron, products, cold-rolled strip, and pipe. 21, 736, 000 4, 000, 000 1, 000, 000 1,000,000 Kilby Steel Co., Inc., Anniston, Open-hearth and electric- 100,000 furnace ingots, rolling-mill 200,000 Lebanon Steel and Iron Corp., Electric steel ingots and hot- Pacific States Steel Corp., Niles, Forging ingots, merchant To assist in the financing of a new steel plant. See note B. For working capital. Direct loan; repaid in full in July 1943 from proceeds of a privately-sold bond issue. Direct loan; no disbursements were 26-inch continuous cold-strip mill.. 18,000 18,000 Additional facilities include a coal chemical plant and Koppers benzol plant (annual capacity for 547,000 tons), six two-hold soaking pits, six preheating pits, five continuou Also included in the facilities were iron-ore properties at Kelso, Calif., (annual capacity Later, due to uncertainty about the supply of scrap, the company proposed to add coke These facilities were subsequently purchased from the Government. Source: Industrial Analysis Branch, Budget and Reports Division, Office of the TABLE IV.-Detail of loan authorizations to companies in the iron and steel industry through June 30, 1940 Direct loan; authorization reduced to (The first loan was an immediate par- The first loan was an NRA loan made Direct loan; no disbursements were Kilby Steel Co., Inc., Anniston, Ingots, hot-rolled bars, and Ala. 160, 000 June 1938. McLouth Steel Corp., Detroit, Mich. forgings. Hot- and cold-rolled strip.. 250,000 July 1938. Rotary Electric Steel Co., De- Ingots, hot rolled products, 750,000 troit, Mich. and cold finished bars. To provide working capital and to assist in financing the purchase of plant facilities. To refund debt, to purchase new To assist in reorganization plan.. Direct loan; $176,250 of this authoriza- Direct loan; borrower was in receiver- Direct loan; authorization reduced to Direct loan; $22,500 disbursed; balance |