there was concentration that might be unlawful in the aluminum industry, and particularly with reference to the Aluminum Co. of America.

Fifth, I wish to state if entities must be big in order to prospect and explore for foreign supplies, I would be the first to say let them be big. I am not necessarily opposed to big companies going into the foreign parts of the world to find those supplies of ore. It is essential to have good supplies of ore. We must get them, whether by big or little companies. If it is essential for the companies to be big, I say let them be big.

Mr. MICHENER. You do not mean you would be opposed to bigness at home if that same bigness could be of benefit to our country abroad?

The CHAIRMAN. I would want the bigness to be so controlled from within or without so that bigness would not have a chance to push everybody off the sidewalk and control the entire situation. I want to see that that bigness either from within or without would be compelled to allocate some of their supplies to the small entities.

They have done that heretofore, but we cannot leave that merely to chance. We must have some assurance, at least the Government must have some assurance, that the smaller entities will also have a chance for that.

Mr. MICHENER. We respectfully disagree, without being disagreeable.

The CHAIRMAN. Mr. Commissioner, if you care to go now, you may feel free to do so.

Mr. MEAD. Yes. The only thought that I had was this: United States Steel has for its future reserves a development in Venezuela. Bethelehem has Venezuela, Cuba, Chile, and Mexico, but this is the point I want to make, which I can perhaps best illustrate with an example:

Sharon Steel Co., which is one of the smaller steel companies, has no future source of supply of its own, and it is dependent now upon the Oliver Iron Mining Co., but the Oliver Iron Mining Co. is one of the ore companies owned by United States Steel. Hence, if Oliver, for any reason, stops supplying Sharon, where is Sharon going to get its iron ore?

Thank you very much, Mr. Chairman.

The CHAIRMAN. Thank you, Mr. Commissioner.

Mr. MEAD. I shall be happy to return, as you suggested.

The CHAIRMAN. Our next witness is Mr. Garland Peyton of the Department of Mines, Mining, and Geology, State Division of Conservation of the State of Georgia. Mr. Peyton, we will be very glad to hear from you. Will you give to the stenographer your qualifications and identification. Just state who you are.

STATEMENT OF GARLAND PEYTON, STATE GEOLOGIST AND DIRECTOR OF THE GEORGIA DEPARTMENT OF MINES, MINING, AND GEOLOGY, STATE DIVISION OF CONSERVATION

Mr. PEYTON. I am Garland Peyton, State geologist and director of the Georgia Department of Mines, Mining, and Geology, State Division of Conservation.

The CHAIRMAN. Proceed, Mr. Peyton.

Mr. PEYTON. Are any further statements necessary about my position and qualifications?

The CHAIRMAN. No.

Mr. PEYTON. Well, I have prepared sort of an outline in written form, which I should like to read. I believe it will be in the interest of conservation of time, and so forth, for me to proceed along that line. The CHAIRMAN. You may proceed.

Mr. PEYTON. There is evidence that in the Cartersville district, Bartow County, Ga., there exists what is probably the largest reserve of medium- to low-grade manganese ore in the Southeast. This manganese ore has been mined over a period of a great many years, and it was in Georgia near Cartersville that the first manganese steel was produced in this country.

In April 1942, a geologist from the staff of the United States Geological Survey made a special memorandum report to the director which included a discussion and description of the manganese ore deposits of the Cartersville, Ga., district. The report included an estimate of the total concentrate reserves of manganese ore believed to be available in the district at that time. This estimate was as follows: That the total concentrafe reserves containing 35 percent or more manganese would not exceed 200,000 tons; that the reserves containing 10 to 35 percent manganese was about 500,000 tons; and that the reserves containing 5 to 10 percent manganese was about 150,000 tons or more. This same report stated that in one area alone, the Aubrey area, there were 100,000 tons of ore which would analyze 35 percent manganese or better. He also listed the following additional areas which were said by him to contain an estimated minimum of 10,000 tons averaging 35 percent or more manganese metal: Bufford, Chumley Hill, Dobbins, Appalachian, Mayburn Springs, and the Pauper Farm. Those are all mine names and property names.

In the past, the usual practice has been to mine this relatively lowgrade material, pass it through a washing plant to eliminate the clay, and then to jig the resultant washed material in order to make as high-grade concentrate as possible for shipment. This procedure produced a product which analyzes from 30 to 45 percent manganese which was shipped in this form to the smelters. This ore being under 50 percent average manganese content could not compete on a favorable basis with imported higher-grade ore, with the result that the Cartersville ore was always subjected to penalties, which meant that the net price paid the producer was much less than that received by the sellers of imported ores. This condition apparently influenced the steel companies' ore buyers to the extent which precluded the purchase of Georgia manganese ore except in periods of emergency. In the hope that this condition might be remedied, the Georgia Department of Mines, Mining and Geology approached the Federal Bureau of Mines and the Minerals Research Division of the Tennessee Valley Authority, with the request that those agencies outline and conduct some experimental research designed to determine the feasibility of attempting to produce a consistently high-grade manganese concentrate from these Cartersville ores.

Both of these agencies did undertake such work, and both agencies came up with fairly promising results. The TVA worked out a scheme of magnetic roasting followed by magnetic separation which resulted in the production of a managnese concentrate analyzing over

45 percent manganese, 6 percent iron, and 12 percent insoluble; an iron concentrate analyzing 8 percent manganese, 55 percent iron, and S percent insoluble. The estimated cost of this magnetic roasting, as of December 1941, was $1.50 per ton.

The United States Bureau of Mines, following their tests on a number of samples of Cartersville manganese ore, obtained results that indicated that these ores are amenable to direct flotation, thus eliminating the gravity concentration step and possessing the further advantage of recovering the fine manganese slimes which in the past have been allowed to go to waste. Using either of these proposed processes or a combination of both of them would appear to insure the production of a salable concentrate of manganese and to produce a very high-grade concentrate of magnetic iron oxide. Such a process also would increase over-all recoverable and usuable reserves of manganese ore in Georgia from 200.000 tons, which is indicated to be available under present methods of mining and concentrating, to something over 800,000 tons because of the fact that all grades of manganese ore which are classified as such could then be treated in such manner as to render them acceptable for smelter use.

In this connection it is desired to invite the attention of the committee to another type of ore in this same district which in our estimation should receive consideration of those interested in the stockpiling of strategic materials for emergency use. This other material is the well-known brown iron ore found thus far mainly in the counties of Floyd, Bartow, Polk, and Cherokee in northwest Georgia. In this area there are some 60 square miles which are known to contain this type of brown iron ore. The importance of this ore is attested by the fact that for more than three-quarters of a century it has been mined extensively and used during both peacetime and wartime, both locally and by the smelters in the Birmingham district. The fact that the producers have been able to ship over such a long period, and in spite of specifications on the part of the ore buyers that the ore shipped should contain a minimum of 45 percent iron, would seem to indicate the importance of this ore.

Not only does this ore contain an average of from 10 to 15 percent more metallic iron than the Alabama red ores, but in addition contains low phosphorus and from one-half percent to 5 percent manganese. In the past a few of the mines have been worked to a depth of 100 feet or more. Most of them, however, have been worked only to a depth of 35 or 40 feet. Drilling by the United States Bureau of Mines has indicated that many of these shallow depths could have been worked to a depth of 100 feet and still be in good brown ore.

The late S. W. McCallie, who for so many years was the State geologist of Georgia, stated in a report which was prepared in 1919 that there were an estimated 100,000,000 tons of brown iron ore in the district under consideration. This is in fairly close agreement with an earlier estimate made by the late Edwin C. Eckel, a geologist formerly with the United States Geological Survey, who estimated 125.000.000 tons.

One of the greatest difficulties which has faced the producers of brown iron ore in the past has been the fact that the ore buyers representing the smelters in the Birmingham district have never been will ing to enter into a regular contract covering the purchase of this brown

iron ore over any extended definite period. The practice has always been to write a letter of authorization permitting the shipment of the ore with a specified minimum iron content until further notice. Often in the past this has resulted in the receipt of instructions, without previous warning, to suspend shipments, with the result that the producer was forced to shut down and remain idle for varying and undeterminable periods of time.

One possible solution to this dilemma, and we believe a solution in which the Government should be interested, is the establishment of one or more centrally located treatment plants designed to beneficiate these brown ores in such manner as to produce consistently high-grade concentrates which will analyze over 50 percent metallic iron and which would contain manganese up to possibly 5 percent. It is this manganese content which we feel should influence the Federal Government in classifying this ore as strategic material.

We are informed that during the recent war period, and following the cessation of hostilities, one of the large steel companies in Alabama stated that that company had found that Georgia brown iron ores contained sufficient manganese to satisfy their requirements in the manufacture of manganese steel and without the addition of any regular manganese ore.

That statement is attributed to Mr. Sanford, who is the buyer for Republic Steel, and he made it to Mr. Frank D. Smith and one of the other producers in the Cartersville district.

If this is true, and if the high-grade iron ore containing this much manganese could be produced regularly day after day, and if the Government would enter into the picture to the extent of stockpiling any surplus production of this ore or even the regular production during periods of smelter shut-down or other refusal of the smelters to buy, then the Georgia iron-ore producers would be in position to do a continuous job of production and feel sure that the industry offered the proper degree of security and attraction as a permanent industry. I should like to point out further that these estimates of both manganese and brown iron ore are based on the depth to which mining has taken place largely. We have had no drilling over an extended area or over the total area considered iron ore and manganese-bearing, to definitely prove how much more than this we do have.

Mr. LEVI. Mr. Peyton, in speaking of the brown iron ores, you were speaking of the ores found in the counties of Floyd, Bartow, and Polk in Georgia?

Mr. PEYTON. That is right. Roughly, it is in the same district that I mentioned manganese exists in.

Mr. LEVI. And do you have any estimate beyond what you have just said as to how extensive these ores may be, how many square miles might be involved?

Mr. PEYTON. Sixty square miles for the brown iron ore, and about 3 miles by 10 miles for the manganese ores mentioned by the United States Geologic Service geologists whose figures I gave.

Mr. LEVI. And for the iron ores is there any estimate that you could give as to how deep they run?

Mr. PEYTON. We have drilled several holes, and some mines have gone down to a depth of 100 feet, and still were in brown iron ore.

Mr. LEVI. And when these ores have been beneficiated or washed, how high do they run?

Mr. Prymix. They can be brought to 60 percent. They can easily be brought up to over 5. perceLL

Mr. Livz And are you familiar with any commercial sales that Lime been male there that run below that!

Mr. PEYTON. I am familiar more or less with most all of the ores that have been produced and sold.

Mr. Lavi. If the percentage were 45 percent would that be high enough to make it a usable ore !

MY. PEYTON. Oh yes. They specify in most instances that they wil serept anything 40 percent of better. It means, however, that inss you go above 3. percent. you do not get the maximum price per unit, and you are subject to penalties for silica or whatever else may lower that.

Mr. LV. And the manganese is particularly important because it is essential in steel making.

Mr. PEYTON. Yes, sir: it is considered essential. •

Mr. Levi. And is it particularly important in the manufacture of ILAT Tutese steel!

Mr. PEYTON. Definitely so.

Mr. Levi. And is the percentage of manganese sufficently high in these ores so that no additional manganese would be required to be allel!

Mr. PEYTON. That is true of the brown ores that contain from oneLaif to 3 percent on the average, and of course it would apply in ary ore that would contain higher Langanese content.

Mr. LEVI. Now are there beyers for this ore today!

Mr. PEYTON. Yes and no. That depends on what we sometimes refer to as the whims of the ore buyers of the steel companies in the Alabama district.

Mr. LEVI. Could you state for us first who the ore buyers are?

Mr. PEYTON. Why, so far as I know, Mr. Sanford represents the Republic Steel Co., and Dr. Blair, Arthur Blair, the Tennessee Coal, Iron & Railway Co. I am not acquainted with the buyers of the other companies.

Mr. LEVI. Are you stating then that there are two principal buyers, the Republic Steel Corp. and the subsidiary of the United States Steel Corp.!

Mr. PEYTON. They are the ones who have taken most of the ores that have been sold in Georgia.

Mr. LEVI. And in your experience do these buyers enter into contracts for the purchase of this ore!

Mr. PEYTON. They refuse to do that. So far as I know they have never done that. They will issue a letter of authorization only stating that until further notice you can ship, provided the iron ore-that is what they are authorizing-contains 45 or higher percentage of iron

content.

Mr. WILLIS. Is that what they do elsewhere?

Mr. PEYTON. Why, so far as we are informed, most big producers get definite contracts for one or more years in advance so they will know how much they can ship and how long, and there is not always that provision that "You will stop when I tell you to cease.”

Mr. LEVI. And you describe it then as a letter of authorization saying you may ship, and then later on there may be another letter saying "Stop shipping."