good deal of work. In the summertime they may work only of evenings.

Senator MALONE. That would be what you would call decentralization of industry.

Mr. RALSTON. Absolutely. It is taken down into such small units you don't have to build a factory. It is peddled around by agents. They are called padrones in Switzerland. I don't know whether there is any opprobrium to the word "padrone," but in this country we would say local agents. The local agent is parceling out work to anybody who wants to do some homework to make a little extra.

That is what rural New England needs in the winters and doesn't have. It is the same thing with southern Appalachian Mountain people. They need that kind of work.

I don't know. We have not tried that kind of a system to see if we can work it out in competition. In New England we know that we have a lot of quite inventive people who may invent in their own homes something where they can do 10 times the work that the fellow does with the accepted little simple apparatus that everybody has.

Senator MALONE. In that area we also have some displaced watchmakers and people who might have an aptitude for work of that kind, do we not?

Mr. RALSTON. Yes. I think that description of Swiss labor needs to be in our literature here because we may get some ideas. That is talking about jewel bearings for instruments which are bigger as a rule. Instruments are usually bigger than watches.

General Electric Co. went through a shortage of instrument bearings in World War I. They found a Pennsylvania man who contracted to make their bearings and did a good job. After the war was over he had done pretty well. He went into a hearing-I think it was in the early stages of the War Production Board before it was named War Production Board. The dicker was made with him by General Electric Co.

They said, "Can you continue to make these, and will you estimate the cost?" He said he could continue and would be glad to for a certain figure.

The General Electric reply was this: "That looks too low. We are not certain you will stay in business. If we are dealing with you we want you to stay in business. Can't we raise this some?"

He was a good old Quaker. He said, "No, I am sure we can make an honest living and a profit with this bid that I made." So General Electric made a contract and hiked the amount to be sure to keep him in, and that man stayed in between wars all the time for them. They had their supply of instrument bearings.

Cost or no cost, American labor or Swiss labor didn't matter. General Electric had enough vision to be sure of its bearings for its instruments.

Senator MALONE. That is very interesting. There is no question in your mind, then, coupled with the testimony of the representatives of your Bureau this morning, that we can be, and should be, self-sufficient in the production of the jewel bearings in this country?

Mr. RALSTON. That is right. At the beginning of the war the delivered cost of the watch bearings was a matter of from 2 cents up to 5 cents apiece. For a 17-jewel watch, you had somewhere between 50 cents and a dollar's worth of bearings. That may not be cheap

39888-53-pt. 1--23

enough for the dollar watches, but the 2-cent bearings were cheap enough for the dollar watches.

Senator MALONE. The dollar watches really do not have many jewel bearings?

Mr. RALSTON. No, they don't.

Senator MALONE. They are cheap watches. I think we are out of dollar watches. We have overcome that through inflation.

Mr. RALSTON. Now, how important is it to have 5-cent bearings in the 17-jewel watch? We know that the cost of the watch is so great compared to the bearings in it that we can stand a multiplied cost. Senator MALONE. I am surprised they are that cheap.

Mr. RALSTON. You can still make your watches in wartime. If you have to have new watches, you can still make them, but they cost

more.

Senator MALONE. But very little more?

Mr. RALSTON. Very little more.

Senator MALONE. That is very interesting.
Go ahead with your list.

Mr. RALSTON. We had some talk about the Cuban laterities. Nickel is a peculiar thing in that the mines that are already developed can produce more nickel than you can sell in peacetime. As soon as war comes along the demand spirals and you never have enough production capacity. The Cuban laterities are the biggest source of nickel in the world.

The proven indicated and inferred reserves of nickel in the 2 or 3 provinces of eastern Cuba amount to 24 millions of tons of nickel. If you see the list of tons of nickel from the rest of the world any place else, there is nothing that approaches it.

Senator MALONE. What is our annual consumption of nickel in tons, approximately?

Mr. RALSTON. That should be in our nickel testimony in this record, but not put in by me.

Senator MALONE. I just wanted to have it appear at this point in the record. Apparently in peacetime, say in 1940, it was about 160,000 tons. At the peak in wartime in 1943, it was probably close to 235,000 tons.

Mr. RALSTON. And that was not enough.

Senator MALONE. In 1952 it was about 200,000 tons. At least that is the range.

Mr. RALSTON. Yes. We never have enough. We always do as much substituting and conservation and replacement of nickel as we can. Senator MALONE. I suppose that the reason for that is because most of the supply, except the secondary recovered supply of nickel, must be imported from Canada.

Mr. RALSTON. That is right. The Cuban deposits are leaner and in peacetime probably cannot compete with the richer deposits that are being worked elsewhere. Therefore, nickel out of Cuban laterite must be produced as a coproduct with something else. What else is there. It is mostly iron ore.

Senator MALONE. What is the percentage of iron ore in those mines? Mr. RALSTON. It is richer than the average feed of blast furnaces in the Birmingham area and a little leaner than any of the northern furnaces.

But you can't make common steel out of the nickel-bearing iron ore. The big tonnage of steel in this country has no nickel in it and the nickel in most of the common steels makes them too tough or too stiff for working.

Again, in a machine shop you will only get a fraction of the output in a machine shop if you have a lot of nickel in your iron or steel. Senator MALONE. I know here in 1952 it says that Canada produced 87.2 percent of our supply; Europe, 5.5 percent; Cuba, 6.7 percent; and the United States proper, six-tenths of 1 percent.

I heard some interesting testimony about an Oregon deposit where a contract has recently been let for nickel.

Mr. RALSTON. Yes.

Senator MALONE. In any case, the nickel supply is plentiful in Cuba. Mr. RALSTON. Yes. The biggest reserve, inferred reserves, in the world, the biggest known deposit is the Cuban laterite ore on a high plateau some thousands of feet up in elevation, and about one-tenth of the so-called nickel is cobalt.

Taking the same tonnage of the ore, which is over 3 billion tons, that lean amount of cobalt makes it the biggest cobalt deposit in sight in the world.

Senator MALONE. That is a very interesting development because cobalt is a strategic mineral.

Mr. RALSTON. As an iron ore it is one of the largest deposits.

Senator MALONE. The chart prepared by the Bureau of Mines shows that in 1952 the consumption of cobalt was approximately 10,000 tons. The consumption has steadily been increasing.

The production in this country has been nominal but we imported last year, together with our production, around 16,000 or 17,000 tons. The greatest imports come from the Belgian Congo.

I am very much interested in your testimony as to what selfsufficiency we might reach in the production of cobalt.

Mr. RALSTON. Taking my figure, I said 24 million tons of nickel, that is really nickel plus cobalt. Ten percent of that is cobalt. That is 2,400,000 tons of cobalt that might take several generations to mine and use.

Senator MALONE. That is a lot of cobalt.

Mr. RALSTON. It is a lot of cobalt.

Senator MALONE. Considering the fact that we have not consumed more than approximately 8,000 to 9,000 pounds in our greatest year of consumption.

Mr. RALSTON. There is also in this material, chromium. The chromium content is about 2 percent. The chromic-oxide content on which we usually rate it is 21/2 to 3 percent.

There is quite a little alumina in there that degrades the iron ore that would normally be 55 down to 45 or 40.

If we were to work the Cuban laterites for those 5 metals or 4 metals and alumina as a byproduct, not counting in the alumina, the gross value per ton of Cuban laterite was said to be about 24 and a fraction dollars. Most of that is the value of the nickel, cobalt, and chromium.

If we can dissect that ore and pull it to pieces and finally ship off iron ore without these alloying elements to be smelted in the United States, we have at our own back door everything needed for selfsufficiency in practically everything except possibly the chromium.

It depends on the scale we work with what we come up with on chromium. Up to date there have been no processes for doing that. There are four now being advanced through research on a pretty fair scale that is being test planted first. It is not really on a truepilot plant.

Senator MALONE. By the Bureau of Mines?

Mr. RALSTON. No, sir; that is private industry. The incentive seems to be there.

If you forget the iron value, if the iron would just pay its way from the mine to the furnace and you make all your profit on the other things, you have a proposition; but if you have to mine all that huge tonnage of what is mainly iron and some alumina oxide in it, and get nothing back for it, then you do not have a commercially profitable process on just the nickel, cobalt, and possible chromium values.

Senator MALONE. It is not profitable due to the competition at the time from other sources in the world?

Mr. RALSTON. Yes.

Senator MALONE. It is very interesting to me that you say we have right on our doorsteps all the supplies of nickel and cobalt we could ever need.

Mr. RALSTON. Yes. They won't cost too much over market price. It might be twice or three times if we load all the costs on those because the Nicaro operation, by the Freeport Sulphur Co. which set up the Nicaro Nickel Co.-it has had several changes of name during its history-and then relinquished it at the end of the war, produced nickel.

They let all the cobalt stay with the nickel and it was sold for the value of nickel and if it had been separated from the nickel it would have been worth more.

Senator MALONE. That is if the cobalt had been separated?

Mr. RALSTON. Yes. But cobalt performed the functions of nickel in most of the alloys in which the nickel went.

Senator MALONE. So this ore would be classed as a complex ore? Mr. RALSTON. It is a metallurgical problem because of its complexity.

Senator MALONE. I mentioned once before in the hearing something that happened in the last 25 or 30 years. We had what was known as a complex ore in Piute, Nev., that contained several metals of sufficient quality or grade but there was no known method of smelting or separating the minerals.

Our mutual friend, Ed Snyder, one of the most persistent men in the mining industry, who has the mining fever that I often describe as a disease, worked on that problem for many years when many people thought he was wasting his time.

Then, when feasible process was developed the area became one of the largest zinc-lead producers in the United States.

Mr. RALSTON. That is right. That mine in Piute was known when I worked in our Salt Lake station for 4 years in 1918.

Senator MALONE. It was a known mine then?

Mr. RALSTON. Yes.

Senator MALONE. But it could not be operated profitably?

Mr. RALSTON. It was a problem. We regard the manganese as a problem.

Senator MALONE. If they work the mine, but not in competition with some foreign sources, with a differential provided for the wage standard of living between here and abroad, they are in the mining business for years!

Mr. RALSTON. Yes. The point I want to make about the Cuban laterities is that there is a huge source. The problem is still unanswered.

Fortunately we have four well-financed, well-managed enterprises individually looking at different processes which I can tell you are quite sophisticated metallurgy compared to anything that has been done on that or previously. All have certain problems, but all aim at recovery of at least 4 out of the 5; if they butcher anything it will be the alumina.

Senator MALONE. You say that the cobalt was included in the nickel. Was the cobalt ever separated?

Mr. RALSTON. No. It did its work which it can do in most alloys; the substitute for nickel. It is just a very expensive substitute.

It was built during the war in a hurry, had a lot of mistakes in the plant; it never reached its rated possible extraction. They jumped from a 1-ton-a-day pilot plant to 3,000 tons a day and, of course, made mistakes in the jump.

They never got the 90 percent extraction of nickel and cobalt that happened in the pilot plant. But it was done under war pressure and it got out some nickel. They got up to 70 percent extraction.

Senator MALONE. The cobalt and the nickel can be separated with known processes now. Under war conditions it could be done? Mr. RALSTON. That is right.

Senator MALONE. And make the cobalt available in such quantities to make us independent in the production of cobalt?

Mr. RALSTON. I don't think anybody can point his finger at what is undoubtedly the best way of separating cobalt from nickel. There are commercial methods in use, each with some disadvantages.

That is one thing that would bear some research, purely technical research, on what is the most effective way of separating those. We have two dozen possible ways and are trying most of them, paper ideas or patents.

Senator MALONE. But through these known methods and the selection of the most feasible method, you could now go ahead and do it in time of emergency at a higher cost?

Mr. RALSTON. That is right. But why should we design something hastily put together, accepting the wrong equipment because the desired equipment cannot be delivered for another 18 months? All that kind of thing happens in war construction when you don't even have your process well worked out and pilot planted.

Senator MALONE. How long do you suppose, in your estimation, would it take if these investigations proceed in an orderly manner to decide on the best method and be ready to install the machinery to make this separation?

Mr. RALSTON. That is the type of problem that I regard as parallel or maybe an aggravated case of what the famous Mr. Kettering said about all new ideas going into the automobile industry. He said from the time they had an idea and decided to try it, until it went into an automobile in some form, took on an average of 7 years.