Imports cannot be stepped up becasue of the absolute quota limitations estabEsted by Presidential proclamation in 1958. Secondary metal sources cannot make up this deficit, as raw material is limited a the amount of scrap generated. During the last quarter of 1964, because of the higher prevailing world price, scrap which ordinarily would flow into the estic market was being exported. Even so, there are many applications for Thich secondary lead is not acceptable. Our use in Charleston is one of these. It is obvious, we believe, from the foregoing that the only source of lead that an relieve the current pressing shortage is the stockpile. Your bill paves the Tay for immediate release from that stockpile. Most sincerely, FRED LEAKE, Jr., President. Upon thus being advised by officers of that corporation, and upon being visited by labor representatives seeking means to resolve the employment situation attendant upon still another closure of Evans ad plant, I introduced S. 1041, to provide for immediate release of lead from stockpiles. However, I was informed that, in the interim, the lack of lead supplies would result in other work stoppages in the sture. I wish to read the message which I received from the Charleston, W.Va., Chamber of Commerce, pleading that all possible efforts be made for early action on this legislation becasue of the severe economic pact of the anticipated work stoppages upon the employees of Erans Lead Corp. and their families. This telegram, sent on February 10, was sent by Mr. William A. Rice, president, Charleston Area Camber of Commerce: Senator ROBERT C. BYRD, TS. Senate Office Building, Washington, D.C. MY DEAR SENATOR BYRD: Thank you for taking prompt action on the request for assistance made by the Evans Lead Division of the National Lead Co. We hope the committees of the Congress can be made to realize the urgency of the situation facing the 60 employees of the firm just 48 hours from now. In this day and age, when the action of Congress is geared to provide aid and Lew services for tens of thousands we hope our 60 Evans workers and the 200plus members of their families will be accorded consideration. Everyone will gain from affirmative action: the employees, their families, and the economy of the greater Charleston area. Evans Lead has now resumed operations; however, on March 1, the president of that organization communicated with me once again, informing me that his plant would be forced to suspend operations, in all probability, during future months if emergency release of lead supplies could not be effected. His sincere plea for assistance in securing lead supplies in order to avoid more crippling work stoppages is eloquent. I wish to read, for emphasis, some paragraphs of the statement, following which, Mr. part of the record of these hearings. Quoting from the memorandum supplied to me by Mr. Leake, I read as follows: in Charleston for more than 40 years. As we stated above, our plant has operated continuously in the same location annnal payroll is in excess of $350,000. The average age of our hourly employees. We currently employ 60 people. Our 1.47%. These people would, generally speaking, be unemployable should our plant be closed. bound freight on our single raw material-lead-amounts to more than $1,500 Our annual gross sales range from $5 million to more than $7 million. Ina day. Freight on our finished goods amounts to more than $1,000 per day. We pay State and local taxes in excess of $50,000 per year. Our Federal income tax ranges from $250,000 to $400,000 per year. The above facts and figures should give some idea of the significance of our We feel that we are a valuable operation to the State and national economy. employer in a depressed area and a valuable economic asset not only to our State, but to the economy as a whole. Because of the nature of our process, our plant cannot be operated at a re duced input rate. Since April of last year, we have not been able to buy sufficient lead for continuous operation. For example, beginning December 21, we At the time of that shutdown, we had on hand 13 had a 3-week shutdown. tons of lead-roughly 4 hours' supply. During the shutdown, we attempted unsuccessfully to build up our raw material stocks. We again, ran out of lead on Friday, February 12, and were forced to close the plant until Monday, February 22. At the present time, we have only sufficient lead at our plant or in transit to our plant to last until March 16. The next shipments of lead we expect will not begin until March 4. Transit time on this lead ranges from 12 to 21 days. We may or may not be forced to close again before the end of March. Only time will tell. (The complete memorandum referred to follows:) MEMORANDUM EVANS LEAD CORP., We have been operating continuously in the same location in Charleston, We produce litharge and red lead, both of which W. Va., since the fall of 1922. are oxides of lead used extensively as raw materials in the manufacture of other products. Metallic lead is our sole raw material. Our products contain 90 percent or more of this metal. Our plant is unique. There is no other plant in the free world capable of producing as pure a product as we produce. This product, fumed litharge, is a primary component in all lead-bearing lens and optical glass, and in all radiationshielding glass produced in this country. For this latter purpose, we ship carloads as far as Seattle, Wash. The more familiar items in which our products are essential ingredients range from Christmas tree lights to neon sign tubing, from the yellow traffic marking paints found on all our highways to the familiar orange paint (red lead) seen universally on bridges, buildings, and all new steel constructions, from the magnets used on can openers, latches, and pot holders in our kitchens to the sound "pickup" cartridges on our phonographs in our living rooms, from the glaze on the dinnerware from which we eat to the crystal glassware from which we drink. In other words, the products we manufacture have a wide and varied use. In every instance, their use is essential to the manufacture of the end product. Without them, a vast array of familiar products would no longer be on the shelves of our stores. As we stated above, our plant has operated continuously in the same location We currently employ 60 people. Our in Charleston for more than 40 years. annual payroll is in excess of $350,000. The average age of our hourly employees is 472. These people would, generally speaking, be unemployable should our plant be closed. Our annual gross sales range from $5 million to more than $7 million. Inbound freight on our single raw material-lead-amounts to more than $1,500 a day. Freight on our finished goods amounts to more than $1,000 per day. We pay State and local taxes in excess of $50,000 per year. Our federal income tax ranges from $250,000 to $400,000 per year. The above facts and figures should give some idea of the significance of our We feel that we are a valuable operation to the State and national economy. employer in a depressed area and a valuable economic asset not only to our State but to the economy as a whole. Because of the nature of our process, our plant cannot be operated at a Since April of last year, we have not been able to buy suffireduced input rate. cient lead for continuous operation. For example, beginning December 21 we At the time of that shutdown, we had on hand 13 tons had a 3-week shutdown. of lead-roughly 4 hours' supply. During the shutdown, we attempted unsuccessfully to build up our raw material stock. We again ran out of lead on Friday, February 12, and were forced to close the plant until Monday, February 22. At the present time, we have only sufficient lead at our plant or in transit to our plant to last until March 16. The next shipments of lead we expect will not begin until March 4. Transit time on this lead ranges from 12 to 21 days. We may or may not be forced to close again before the end of March. Only time will tell. Annual lead consumption in the United States is about 1,200,000 tons. There are three sources of lead. These sources are domestic mines production, imports of ore and refined lead, and secondary lead. Domestic mines increased production during 1964 and will attempt further increases in 1965. There is no hope, however, of enough increase in mine producon before 1966 to avoid a deficit between supply and requirements. Imports cannot be stepped up because of the absolute quota limitations estabEshed by Presidential proclamation in 1958. Secondary smelters cannot make up the deficit as their raw material is limited the amount of scrap available. Even so, there are many applications for which secondary lead is not acceptable. Our use in Charleston is one of these. Because of the higher prevailing world price for lead, exports increased during 1964 from 4,000 to 24,000 tons. At the same time and for the same reason, imrts decreased by 44,000 tons. The significant point is the net loss of available supplies in this country-64,000 tons during 1964-when considered in relaon to the other factors affecting the total supply. According to the American Bureau of Metal Statistics, refined pig lead stocks Lave steadily declined The year 1964 was the third year in a row where shipments exceeded production. Primary smelters can no longer ship more than they can produce. Stocks have reched an irreducible minimum. Only because of last summer's release of 0000 tons from stockpile were there any refined pig lead stocks on hand January 1.1965 From the foregoing, we feel the neecssity of an immediate release from the rplus in stockpile is obvious. We urge passage of S. 1041 to assure the orderly and continued operation of our plant and employment of our people. FRED LEAKE, Jr., President, Evans Lead Corp. In my position as a U.S. Senator representing the State of West Virginia, I cannot help but feel sharply the importance of coordinaon of Federal programs and actions to assure the achievement of sated governmental goals and the successful accomplishment of tasks dertaken. On the one hand, Federal funds and Federal energies are being expended to restore my State to reasonable economic levels, increase empployment, and to stimulate industrial growth. It Fald appear to be the course of wisdom and good economics to take andiate action to make available raw materials which would elimite unemployment, economic loss, and industrial retardation in insances such as this. I am not asking for preferential treatment for my State. I use example of this firm in West Virginia because of my personal owledge of the problem involved and my close personal concern bring about the earliest possible solution. I am aware that simicircumstances obtain elsewhere in regard to the lead industry, and am indeed hopeful that through your sympathetic efforts, early ief can be provided. I am advised that appropriate Federal departmental officials, repreting their viewpoint and that of the administration, are in favor of eaction proposed. I do not believe that the release of the proposed quantity of lead from stockpile could be considered as threatening disruption to producers, consumers, or allies of the United States insofar as orderly marketing is involved. A stipulation to afford suitable protection is included in the bill. I wish to present a general statement as to the anticipated manner in which responsible Federal authorities intend to proceed in carrying out the proposed release of the lead tonnage. MARCH 3, 1965. NOTES ON LEAD FOR SENATOR ROBERT C. BYRD In 1963, in the United States new supplies of lead fell short of consumption by 65,000 tons. This deficit was made up by a drawdown of the very large stocks built up between 1957 and 1963. In 1964, new supplies were again inadequate. Producers' stocks of metal were drawn down by 22,000 tons, and 50,000 tons were released from the U.S. stockpile. Thus a deficit in 1964 of 72,000 tons (despite an increase of mine production in the United States of 28,000 tons over 1963). In 1965, mine output should rise another 15,000 to 20,000 tons. Consumption should gain at least this much. If imports equal 1963 level, the deficit in the United States should be about the same as 1964, namely 75,000 to 100,000 tons. Producers' stocks are described as "dangerously low." Total stocks at primary and secondary smelters represent less than a month's supply. These stocks should be built up. To meet the anticipated deficit in supplies and to provide some buildup of stocks, 125,000 to 150,000 tons of refined lead will be needed in 1965. The proposal, approved by producers and consumers, is to release 60,000 tons immediately upon enactment of authorizing legislation, and then review the situation 90 days later. JOSEPH C. MCCASKILL, Mr. Chairman, I compliment you on your knowledge of the situation to which I have addressed my remarks, and I commend you on the work which you have done over a long period of time in dealing with these matters. I thank you for your kind consideration in permitting me to testify in support of my bill, and I want to express the hope that the subcommittee will act favorably on the proposed legislation so as to quickly provide needed relief to the affected industries and the people who work in those industries. Senator SYMINGTON. Thank you, Senator. We appreciate your being with us. We also appreciate your statement, and will be glad to give it consideration as we discuss this bill. Senator BYRD of West Virginia. Thank you, Mr. Chairman. May I request that a letter I have received from Mr. C. H. Reiningel, president and general manager of the Powhatan Brass & Iron Works, Ranson, W. Va., dealing with the shortage of copper be inserted in the record? Senator SYMINGTON. Without objection the letter will be inserted at this point. (The letter follows:) Hon. ROBERT C. BYRD, Washington, D.C. POWHATAN BRASS & IRON WORKS, DEAR SENATOR BYRD: As you know, the raw material from which our products are made is brass ingot, which is made primarily from scrap. The copper market ordinarily doesn't influence the scrap market to a great degree, but in the past year a most unusual situation has been created by a variety of reasons, among which are frequent strikes in the copper mines of Chile and Africa, large purchases of copper from these countries by Red China and Russia, and heavy exports of scrap to Japan from this country. This has created not only a serious copper shortage, but a serious scrap shortage, with the accompanying price problems. Prices of ingot, rod, and tubing, all of which we use in quantity, are unpredictable and completely unrealistic in relation to the selling prices we can obtain for our material. It is impossible to secure prompt shipment of orders for rod and tubing, and even after long delays partial shipments, never actually completed, are the order of the day. To help alleviate this serious situation, I understand Senator Mansfield has proposed that 100,000 tons of copper be released from the strategic stockpile to ndustry. I also understand action on this proposal has been delayed. Relief on this matter is needed immediately, and I urge you to do all possible to see that favorable action is taken promptly. The authorization last year of distribution of zinc and lead from the stockpile was very helpful to the situation as it applied to those two markets, and similar action now is imperative to help the copper consumer. Your full support of Senator Mansfield's proposal now is strongly urged and will deeply appreciated. With kindest personal regards. Very truly yours, C. H. REININGEL, President and General Manager. Senator BYRD of West Virginia. I would also like to introduce Mr. Fred Lake, president of the Evans Corp., who is here with me today, to answer the questions asked by Senator Cannon. STATEMENT OF FRED LEAKE, PRESIDENT, EVANS LEAD CORP. Mr. LEAKE. We get our lead from Kellogg, Idaho, from SAS, Omaha, and St. Joe, Omaha, and so forth. Senator CANNON. Is it lead that is mined domestically here or does primarily come from abroad? Mr. LEAKE. Primarily it is domestic lead. Senator CANNON. And have you made every effort that you could to get lead from other sources domestically? Mr. LEAKE. And imported; yes. Senator CANNON. Thank you. Senator BYRD of West Virginia. Thank you. Senator SYMINGTON. I have statements for the record from Senator Mansfield, Senator Metcalf, Senator Moss, Senator Ribicoff, the American Mining Congress, the American Copper Tariff Board, the American anti-knock fluid industry, the Copper and Brass Fabricators Emergency Committee and statements and telegrams from various 1er firms and individuals who have asked to be included in the ord. Without objection, they will be included. The statements and telegrams follow:) LETTER WITH ENCLOSURES FROM SENATOR MIKE MANSFIELD, OF MONTANA STUART SYMINGTON, U.S. SENATE, man, Subcommittee on National Stockpile and Naval Petroleum Reserves, ES. Senate, Washington, D.C. AR MR. CHAIRMAN: In order to expedite the hearings which you have called 8.296, on Tuesday, March 3, I am enclosing for your consideration various unications relative to the copper situation which you may find of interest which, if you think it advisable, you may want to incorporate in the record. |